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Order Granting Motion to Dismiss

Order Granting Motion to Dismiss

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Court holds that information is not sufficient consideration for contract formation. Court also holds that a contract is invalid if a party is induced into the contract (even without fraud).
Court holds that information is not sufficient consideration for contract formation. Court also holds that a contract is invalid if a party is induced into the contract (even without fraud).

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Categories:Business/Law
Published by: Document Repository on Dec 02, 2012
Copyright:Attribution Non-commercial

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12/04/2012

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IN THE UNITED STATES DISTRICT COURTFOR THE SOUTHERN DISTRICT OF OHIOWESTERN DIVISION AT DAYTON
 
TRATON NEWS, LLC, : Case No. 3:11-cv-435Plaintiff, Magistrate Judge Michael J. Newman(Consent Case)-vs- :TRATON CORP.,
et al.
,Defendants. :______________________________________________________________________________
ENTRY AND ORDER: (1) GRANTING DEFENDANTS’ MOTIONS TO DISMISS(DOCS. 25, 26); (2) DENYING AS MOOT ALL OTHER PENDING MOTIONS (DOCS. 23,27, 28, 36, 38); (3) DIMISSING WITHOUT PREJUDICE PLAINTIFF’S INITIAL ANDAMENDED COMPLAINTS; AND (4) TERMINATING THIS CASE______________________________________________________________________________
 This consent case involves claims under the Lanham Act, 15 U.S.C. § 1051,
et seq.
, andbreach of contract claims. It is now before the Court on motions to dismiss filed by DefendantsTraton Corp. and Traton Homes, LLC (collectively the “Traton Defendants”) (doc. 25) and byDefendants Flammer Relations, Inc. and mRELEVANCE, LLC (collectively the “VendorDefendants”) (doc. 26). Plaintiff has filed responsive memoranda (docs. 32, 33); and Defendantshave filed a reply memorandum (doc. 35). The Court heard oral arguments on these motions onMay 21, 2012.
See
doc. 39.
I. Background
To understand this case, it is necessary for the Court to briefly review the parties’backgrounds and the events leading up to this lawsuit. Traton Corp. was founded in 1971 by twobrothers, William Poston and Millburn Poston. Declaration of William C. Poston (doc. 25-1) ¶ 2.The “Traton” name derives from the names of their children -- Millburn’s daughter (Tracy) and
Case: 3:11-cv-00435-MJN Doc #: 48 Filed: 08/28/12 Page: 1 of 16 PAGEID #: 1298
 
2William’s son (Clifton).
 Id.
¶ 4. Traton Corp. and its affiliated company, Traton Homes, LLC,are engaged in “various activities primarily devoted to residential community developmental andresidential home construction in and around Atlanta, Georgia.”
 Id.
¶ 3.The Traton Defendants have operated a website at www.tratonhomes.com since before2005. Declaration of Chris Poston (doc. 25-2) 3. Through their website, the TratonDefendants “have publicly promoted their community development and homebuilding enterprise,and . . . specifically have kept realtors, potential customers, and residents of their communitiesapprised of relevant news and events concerning the operations of the Traton companies.”
 Id.
 Plaintiff Traton News, LLC is an Ohio limited liability company (“Traton News (Ohio)”),which “is engaged in [the] business of publishing news stories and weblogs on the Internet.”Plaintiff’s Amended Complaint (doc. 17) ¶ 2. Sam Han is the incorporator and sole member of Traton News, LLC (Ohio).
See
doc. 43-5. It is also relevant to note that Sam Han is an attorneywho represented Christopher Moses (an individual who had purchased a house from TratonHomes in May 2004) in a 2005 trespass lawsuit against Traton Corp. and its employee in Georgiastate court.
1
 
See Moses v. Traton Corp.
, 650 S.E.2d 353 (Ga. Ct. App. 2007).
A.
 
Plaintiff’s Website (www.traton.com)
In Spring 2006, the Traton Defendants became aware of a website, www.traton.com,operated anonymously but using the name “Traton News.” Doc. 25-2 ¶ 13. This website
1
In that lawsuit, Moses claimed that Traton Corp. was liable to him for damage done when “constructionvehicles drove over a portion of the grass near the curb in front of Moses’s house, creating ruts and otherdamage to the turf and soil.”
 Moses
, 650 S.E.2d at 354. It was undisputed that the damaged land wasentirely within a public right of way owned by the county, however.
 Id.
Accordingly, the Georgia trialcourt granted the defendants’ motion for summary judgment, finding Moses did not have standing to bringsuch an action because he did not have a protectable legal interest in the public right of way.
 Id.
at 354-57.The Georgia Court of Appeals affirmed the trial court’s ruling.
 Id.
Case: 3:11-cv-00435-MJN Doc #: 48 Filed: 08/28/12 Page: 2 of 16 PAGEID #: 1299
 
3contains negative “news articles” and information about the Traton Defendants.
2
The followingheadlines demonstrate the type of negative articles published there: “Home Buyers Dissatisfiedwith Traton Homes’ Failure to Resolve Title Issues”; “Ridiculous Warranty Issue Plagues TratonHomes Customer”; “Traton Homes Disrupts Yet Another Home Owner’s Life”; “TratonSuspected of Felony”; “Procedures at Traton Homes [M]ay Deprive Real Estate Agents of Commission”; “Traton Homes Turns Up a Big Zero at the 2008 OBIE Awards”; “Traton HomesRatings Sub-Standard for Three Consecutive Years”; “Traton Sucks and Taubman Sucks”; and“Traton Homes Covenants Worthless to Protect Homeowners.”
3
Doc. 2-5. This is only a sampleof the many negative articles.
See id.
B. The Evolution of Traton News, LLC
In March 2006, Christopher Moses (the plaintiff in the Georgia lawsuit against TratonCorp.) created a Georgia limited liability company named “Traton News, LLC” (“Traton News(Georgia)”). Doc. 43-3 at PageID 1145. On April 20, 2006, Traton News (Georgia) submittedan application to the United States Patent and Trademark Office (“USPTO”) for registration of thetrademark “TRATON” with respect to “news reporting services.”
See
doc. 43-2 at PageID1139-44. Traton News (Georgia) claimed it owned the TRATON mark, and first used it inconnection with news reporting services on March 15, 2006.
 Id.
Traton News (Georgia) was
2
There does not appear to be a dispute that Plaintiff’s website does, in fact, publish negative informationabout the Traton Defendants. However, there is disagreement concerning the purpose of the website. TheTraton Defendants claim the website “served (and still serves today) the singular purpose of publishingfalse and defamatory information about [Traton Corp. and related parties.]” Doc. 25 at PageID 616. Onthe other hand, Plaintiff denies that the website’s purpose is to publish negative articles about the TratonDefendants.
See
doc. 32 at PageID 808. Plaintiff states, “The articles posted on the website includevarious news topics including chess, intellectual property, Traton Homes, other homebuilders in Atlanta, ameteor shower, Star Trek, and others.”
 Id.
Further, since 2008, Plaintiff claims, “the majority of articleshave not been about Traton Homes.”
 Id.
 
3
Plaintiff attached a screenshot of the website’s homepage to its original Complaint displaying theseheadlines. Doc. 2-5.
Case: 3:11-cv-00435-MJN Doc #: 48 Filed: 08/28/12 Page: 3 of 16 PAGEID #: 1300

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