United States District Court, E.D. Virginia, Norfolk Division
OPINION AND ORDER
MARK S. DAVIS, District Judge.
This matter is currently before the Court on two Motions to Dismiss filed separately by Pro-Concepts, LLC ("Pro-Concepts" or "Plaintiff") and Timothy Mark Resh ("Resh" or "Defendant"). In the first motion, Plaintiff moves for an order dismissing Defendant's counterclaims on the grounds that Defendant failed to state a claim under Fed.R.Civ.P. 12(b)(6) "and/or to strike his counterclaims under Fed.R.Civ.P. 12(f)." ECF No. 21. The second motion before the Court is Defendant's motion to dismiss Plaintiff's claims with prejudice, which, as discussed below, the Court interprets as a motion for judgment on the pleadings asserting Plaintiff's failure to state a claim for relief under Rule 12(b)(6). ECF No. 24.
Plaintiff has filed a response in opposition to Defendant's motion; however, Defendant has not filed a reply to Plaintiff's response. With regard to Plaintiff's motion, Defendant has failed to file an opposition to Plaintiff's motion to dismiss. The time for doing so has long since passed with regard to both motions. While the Court is cognizant that "[p]arties appearing pro se should be given some leeway in meeting procedural rules due to their lack of legal knowledge, " Todtman, Nachamie, Spizz & Johns, P.C. v. Ashraf , 241 F.R.D. 451, 454 (S.D.N.Y. 2007), aff'd, 316 F.Appx. 51 (2d Cir. 2009) (unpublished), Defendant has failed to file a response or a motion for an extension of time and has had almost a year to do so. The Court therefore deems the motions ripe for decision.
After examination of the briefs and the record, the Court has determined that a hearing on the instant motions is unnecessary, as the facts and legal arguments are adequately presented, and the decisional process would not be aided significantly by oral argument. See Fed.R.Civ.P. 78(b); E.D. Va. Loc. Civ. R. 7(J). Thus, the Court DENIES Plaintiff's Request for a Hearing on these motions. ECF No. 26.
For the reasons that follow, the Court GRANTS, in part, and DENIES, in part, Plaintiff's Motion to Dismiss Defendant's Counterclaims; and DENIES Defendants' Motion to Dismiss Plaintiff's Claims.
I. FACTUAL AND PROCEDURAL BACKGROUND
Pro-Concepts filed the instant action on October 19, 2012 asserting seven counts against Resh. Pro-Concepts' Complaint alleges causes of action for Trademark Infringement under the Lanham Act, 15 U.S.C. § 1501 et seq., as amended (Count I), False Designation of Origin under 15 U.S.C. § 1125(A) (Count II), Cybersquatting under 15 U.S.C. § 1125(d) (Count III), Unfair Competition under Virginia law (Count IV), Trademark Dilution under Virginia law (Count V), Breach of Contract under Virginia law (Count VI), and Conversion under Virginia law (Count VII). See, Compl., ECF No. 1. That same day, Pro-Concepts separately moved for a preliminary injunction, based on Counts I, III, VI, and VII of the Complaint, requiring Resh to: (1) cease selling or otherwise promoting a website or services that use any designs or marks confusingly similar to or dilutive of Risk Radar; (2) immediately transfer ownership and control of the Risk Radar Enterprise ("RRE") website to Pro-Concepts; (3) return any and all copies of software programs belonging to Pro-Concepts; and (4) cease any and all use of Risk Radar software or any other materials belonging to Pro-Concepts. See, Mot. for Prelim. Inj., ECF No. 3.
Resh twice moved for an extension of time to file an Answer, but, as neither motion sought an extension of time to file a response to Pro-Concepts' motion for preliminary injunction, Resh failed to respond timely to that motion. However, Resh did file a separate motion to deny the injunction on January 15, 2013. As Resh is proceeding pro-se, the Court is required to construe his filings liberally and the Court thus treated his motion to deny injunction as a response in opposition. The Court held a hearing on Pro-Concepts' motion for preliminary injunction on Wednesday, January 16, 2013 at 1:30 p.m. and each side presented testimony and offered argument in support of their respective positions. At the conclusion of the hearing, Defendant agreed to take down the "RRE" website, thus making it unavailable to the public during the pendency of the case. The Court then took Pro-Concepts' motion under advisement and directed the parties to a settlement conference before a Magistrate Judge.
On January 23, 2013, Resh filed his Answer to the Complaint in which he asserted twenty-two (22) affirmative defenses, including failure to state a claim upon which relief can be granted, and seven counterclaims. ECF No. 16. On January 28, 2013, the parties attended a settlement conference before Magistrate Judge Prince. The case did not settle, but as Pro-Concepts represented to the Court in their motion to stay filed on January 30, 2013, the parties agreed to continue the settlement discussions over the ten (10) days following the settlement conference. ECF No. 17. This Court granted the Agreed Order on Pro-Concepts' motion to stay on January 30, 2013 and stayed the case for ten (10) days. ECF No. 18. However, in a February 8, 2013 motion, Pro-Concepts sought a ruling on its motion for preliminary injunction, n[b]ecause the harms described by [Pro-Concepts] in its Motion... continue and the issues described therein remain unresolved." Mot. for Ruling on Prelim. Inj. ¶ 10, ECF. No. 19. On February 20, 2013, Resh filed a motion for ruling on his motion to deny injunction. ECF No. 23. On October 22, 2013, the Court issued a lengthy and detailed opinion denying Pro-Concepts' request for a preliminary injunction. ECF No. 30.
On February 19, 2013, Pro-Concepts filed a motion to dismiss Resh's counterclaims for failure to state a claim under Federal Rule of Civil Procedure 12(b) and to strike such claims pursuant to Rule 12(f). ECF No. 21. Resh has not filed a response in opposition to this motion.
However, on February 27, 2013, Resh filed a motion to dismiss Pro-Concepts' claims with prejudice based on representations Pro-Concepts' counsel made at the settlement conference. ECF No. 24. Pro-Concepts responded to Resh's motion to dismiss on March 7, 2013, however, Resh has not filed a reply to this response. ECF No. 25. On March 21, 2013, Pro-Concepts requested a hearing on both pending motions to dismiss. ECF No. 26. Subsequently, the Court issued a second order on April 1, 2013 directing the parties to appear at a settlement conference before a Magistrate Judge, which was held on April 12, 2013. ECF No. 28. The Court then held a telephonic status conference with the parties upon their request on May 7, 2013. As noted above, the Court issued a lengthy Opinion and Order on October 22, 2013, denying Plaintiff's request for a preliminary injunction. Because that October 22, 2013 Opinion and Order contained a detailed statement of the facts of this case, the Court will not go into these facts in detail here.
Having received such written filings, oral testimony, and oral argument, and having given the parties sufficient time to try to resolve their dispute in settlement conferences, this matter is now ripe for decision.
II. STANDARD OF REVIEW
A. Rule 12(b)(6) Motion to Dismiss
A complaint should be dismissed under Federal Rule of Civil Procedure 12(b)(6) where it appears that the facts alleged fail to state a "plausible" claim for relief. Ashcroft v. Iqbal 556 U.S. 662 , 678 (2009) (quoting Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570 (2007)). "Factual allegations must be enough to raise a right to relief above the speculative level... on the assumption that all the allegations in the complaint are true (even if doubtful in fact)." Twombly , 550 U.S. at 555. "And, of course, a well-pleaded complaint may proceed even if it strikes a savvy judge that actual proof of those facts is improbable, and that a recovery is very remote and unlikely.'" Id. at 556. The Fourth Circuit recently explained the standard as follows: "To survive a Rule 12(b)(6) motion to dismiss, a complaint must establish facial plausibility' by pleading 'factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.'" Clatterbuck v. City of Charlottesville , 708 F.3d 549, 554 (4th Cir. 2013) (quoting Iqbal , 556 U.S. at 678).
In assessing the merits of a Rule 12(b)(6) motion to dismiss, a district court "must accept as true all of the factual allegations contained in the complaint' and draw all reasonable inferences in favor of the plaintiff.'" Kensington Volunteer Fire Dept., Inc. v. Montgomery County, Md. , 684 F.3d 462, 467 (4th Cir. 2012) (quoting E.I, du Pont de Nemours & Co. v. Kolon Indus. , 637 F.3d 435, 440 (4th Cir. 2011)). Furthermore, a district court "may consider documents attached to the complaint or the motion to dismiss so long as they are integral to the complaint and authentic.'" Kensington Volunteer Fire Dep't, 684 F.3d at 467 (quoting Philips v. Pitt Cnty. Memorial Hosp. , 572 F.3d 176, 180 (4th Cir. 2009)). However, while a district court must construe well-pled facts in the light most favorable to the plaintiff, "legal conclusions, elements of a cause of action, and bare assertions devoid of further factual enhancement fail to constitute well-pled facts for Rule 12(b)(6) purposes." Nemet Chevrolet, Ltd. v. Consumeraf fairs. com, Inc. , 591 F.3d 250, 255 (4th Cir. 2009). If a plaintiff fails to allege facts sufficient to plausibly infer that such plaintiff is entitled to relief, then dismissal must be granted.
With these pleading standards in mind, the Court must also consider the prior admonitions of the Supreme court, recognizing that the pleadings of a pro se litigant are held to a less stringent standard. "As the Court unanimously held in Haines v. Kerner, a pro se complaint, however inartfully pleaded, ' must be held to less stringent standards than formal pleadings drafted by lawyers' and can only be dismissed for failure to state a claim if it appears "beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief."'" Estelle v. Gamble , 429 U.S. 97, 106 (1976) (quoting Haines v. Kerner , 404 U.S. 519, 520-521 (1972)) (internal citations omitted); Erickson v. Pardus , 551 U.S. 89, 94 (2007); Dolgaleva v. Virginia Beach City Public Schools , 364 Fed.Appx. 820 (4th Cir. 2010) (relying on Atherton v. Dist. Of Columbia Office of Mayor , 567 F.3d 672, 681-82 (D.C. Cir. 2009) for the proposition that pro se complaints "must be held to less stringent standards then formal pleadings" but that "even a pro se complaint must plead factual matter' that permits the court to infer more than the mere possibility of misconduct.'").
B. Rule 12(f) Motion to Strike
Federal Rule of Civil Procedure 12(f) provides that "[t]he court may strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter." (emphasis added). However, as recognized in Whittlestone, Inc. v. Handi-Craft Co. , 618 F.3d 970, 974-76 (9th Cir. 2010), Rule 12(f) is not a proper vehicle for procuring the dismissal of all or part of a pleading on the ground that it fails to state a claim for relief. Such relief is better sought by use of Rule 12(b)(6).
Furthermore, "Rule 12(f) motions are generally viewed with disfavor because striking a portion of a pleading is a drastic remedy and because it is often sought by the movant simply as a dilatory tactic.'" Waste Mgmt. Holdings, Inc. v. Gilmore , 252 F.3d 316, 347 (4th Cir. 2001) (quoting 5A A. Charles Alan Wright & Arthur R. Miller, Federal Practice & Procedure § 1380, 647 (2d ed. 1990)). "It is a generally accepted view that a motion to strike for redundancy ought not to be granted in the absence of a clear showing of prejudice to the movant.'" Builders Mut. Ins. Co. v. Dragas Mgmt. Corp. , 709 F.Supp.2d 432, 437 (E.D. Va. 2010) (quoting 5C Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1382 (3d. ed. 2004)). "Nevertheless, a defense that might confuse the issues in the case and would not, under the facts alleged, constitute a valid defense to the action can and should be deleted.'" Id.
C. 12(c) Motion for Judgment on the Pleadings
Federal Rule of Civil Procedure 12(c) provides that "[a]fter the pleadings are closed-but early enough not to delay trial-a party may move for judgment on the pleadings." Federal Rule of Civil Procedure 12(h)(2) "provides that the defense of failure to state a claim upon which relief can be granted, as set forth in Rule 12(b)(6), may be raised by motion for judgment on the pleadings [pursuant to Rule 12(c)], or at the trial on the merits.'" Shooting Point, L.L.C. v. Cumming , 238 F.Supp.2d 729, 735 (E.D. Va. 2002) aff'd, 368 F.3d 379 (4th Cir. 2004) (citing Edwards v. City of Goldsboro , 178 F.3d 231, 243 (4th Cir. 1999)). As such, the standard of review for a motion for judgment on the pleadings under Rule 12(c) is identical to that of a motion to dismiss for failure to state a claim under Rule 12(b)(6), making the decision as to which applies irrelevant as a practical matter. Id .; see also Burbach Broad. Co. of Del, v. Elkins Radio Corp. , 278 F.3d 401, 405-06 (4th Cir. 2002).
Accordingly, the Court will assume that the facts alleged in the Complaint are true and will draw all reasonable inferences in Plaintiff's favor as the nonmoving party. Burbach , 278 F.3d at 405-06. However, while the Court "takefs] the facts in the light most favorable to the [P]laintiff, ... [the Court] need not accept the legal conclusions drawn from the facts, " and "need not accept as true unwarranted inferences, unreasonable conclusions or arguments." Giarratano v. Johnson , 521 F.3d 298, 302 (4th Cir. 2008) (quoting Eastern Shore Mkts., Inc. v. J.D. Assocs. Ltd. P'ship , 213 F.3d 175, 180 (4th Cir. 2000)). Additionally, the Complaint must allege "enough facts to state a claim to relief that is plausible on its face." Id . (citing Bell Atlantic Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 1974, 167 L.Ed.2d 929 (2007)).
Mendenhall v. Hanesbrands, Inc. , 856 F.Supp.2d 717, 723 (M.D. N.C. 2012). "However, unlike on a Rule 12(b)(6) motion, on a Rule 12(c) motion the Court may consider the Answer as well, " and the "factual allegations in the Answer are taken as true to the extent they have not been denied or do not conflict with the Complaint." Id. at 724 (internal quotations and citations omitted); see Fed.R.Civ.P. 8(b)(6) ("If a responsive pleading is not required, an allegation is considered denied or avoided."). Additionally, judgment on the pleadings is only appropriate when, taking all of the non-moving party's factual allegations as true, no genuine issues of material fact remain and the case can be determined as a matter of law. Smith v. McDonald , 562 F.Supp. 829, 842 (M.D. N.C. 1983), aff'd, 737 F.2d 427 (4th Cir. 1984), aff'd, 472 U.S. 479, (1985).
A. Plaintiff's Motion to Dismiss Defendant's Counterclaims
Plaintiff requests dismissal of Defendant's counterclaims under Fed. R. Civ. Pro. 12(b)(6) and/or Fed. R. Civ. Pro. 12(f), depending on the counterclaim in question. Therefore, the Court will address Plaintiff's motion to dismiss with regard to each counterclaim individually.
1. Counterclaim 1-Declaratory Judgment of Non-Infringement
Pro-Concepts requests that Resh's counterclaim for declaratory judgment be stricken or dismissed on two bases. Pro-Concepts' first argument is that the counterclaim is a "mirror image claim" duplicative of both Pro-Concepts claim for trademark infringement and Resh's affirmative defense of non infringement and should be stricken under Rule 12(f). Pro-Concepts' second argument is grounded in their assertion that the court has discretion to decline to entertain a counterclaim for declaratory judgment such as Resh's. While Resh's counterclaim for declaratory judgment of non infringement is duplicative of Resh's affirmative defense of non-infringement as well as Pro-Concepts claim for trademark infringement, it "is a generally accepted view that a motion to strike for redundancy ought not to be granted in the absence of a clear showing of prejudice to the movant.'" Builders Mut. Ins. Co. , 709 F.Supp.2d at 437 (quoting 5C Charles Alan Wright & Arthur R. ...