Professional Documents
Culture Documents
Plaintiff W.A.T.C.H. TV Company (“Watch”) asserted five claims against Defendant Grit
Technologies LLC (“Grit,” and together with Greg Jarman, Roger Criblez, Tom Kolb and B. Todd
Mosby, “Defendants”). Three of these – (1) false designation of origin and unfair competition
under Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a) (Count I); (2) civil conspiracy (Count
VII); and (3) unfair competition in violation of common law (Count VIII) – fail to state a claim.
LEGAL STANDARD
Grit moves to dismiss three of the claims asserted against it pursuant to Rule 12(b)(6) for
failure to state a claim upon which relief may be granted. To survive a Rule 12(b)(6) motion to
dismiss, a claim must contain sufficient factual matter “to state a claim to relief that is plausible
on its face” (Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)), which occurs when enough
facts are pled that the court can “draw the reasonable inference that the defendant is liable for the
misconduct alleged” (Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). Put differently, “[t]he fact that
the allegations undergirding a claim could be true is no longer enough to save a complaint from
1
Case 1:21-cv-00550-RLY-MJD Document 28 Filed 04/28/21 Page 2 of 8 PageID #: 204
being dismissed; the complaint must establish a nonnegligible probability that the claim is valid
….” In re Text Messaging Antitrust Litig., 630 F.3d 622, 629 (7th Cir. 2010).
While the Court must “tak[e] all well-pleaded allegations of the complaint as true and
view[] them in the light most favorable to the plaintiff” (Santiago v. Walls, 599 F.3d 749, 756 (7th
Cir. 2010)), it is “not obliged to accept as true legal conclusions or unsupported conclusions of
fact” (Hickey v. O’Bannon, 287 F.3d 656, 658 (7th Cir. 2002)). And a plaintiff “pleads himself
out of court when it would be necessary to contradict the complaint in order to prevail on the
merits.” Tamayo v. Blagojevich, 526 F.3d 1074, 1086 (7th Cir. 2008).
ARGUMENT
Section 43(a) the Lanham Act, 15 U.S.C. § 1125(a)(1) provides, in relevant part:
The Seventh Circuit has held that stating a claim under this prong requires a plaintiff to show (1)
the defendant made a material false statement of fact in a commercial advertisement; (2) the
statement actually deceived or has a tendency to deceive a substantial segment of its audience; and
(3) the plaintiff has been or is likely to be injured as a result. Board of Forensic Document
Examiners, Inc. v. Am. Bar Assoc., 922 F.3d 827, 833 (7th Cir. 2019). Count I relies upon the
Complaint’s preceding allegations of fact to claim that Defendants – as a group and without
distinguishing who supposedly did what – violated Section 43(a) primarily through “Defendants’
2
Case 1:21-cv-00550-RLY-MJD Document 28 Filed 04/28/21 Page 3 of 8 PageID #: 205
use of ‘Watch Communications’ or any confusingly similar name in connection with broadband
But the Complaint does not allege that any Defendant utilized the “Watch
Communications” mark or any similar mark. Indeed, Watch alleges that an unnamed partner
“reached out to Jarman believing that Jarman was still employed by Watch,” and “came to realize
that Jarman was no longer a representative of Watch” when “he was then asked to sign a document
with a GRiT logo.” (Id. ¶ 57 (emphasis added).) This does not allege that Jarman (or anyone else)
used Watch’s mark, but instead describes a Watch partner who sought out Jarman based on the
partner’s own preexisting belief of affiliation and realized his mistake when Jarman appropriately
utilized GRIT’s mark and not Watch’s. (Id.) Likewise, Watch alleges that “Jarman was holding
himself out as a GRiT principal to Hometown Cable” and “acting as a GRiT principal, had planned
additional meetings with Hometown in the future.” (Id. ¶ 47 (emphasis added).) Thus, Count I
fails to state a claim against any Defendant based on a supposed use of Watch’s mark, and should
Watch next claims that all five Defendants – Grit and its four employees – engaged in a
civil conspiracy against Watch “to [1] start a competing business and [2] misappropriate Watch
proprietary materials for use in providing services to Watch customers and to directly compete
against Watch to provide those services.” (Cmpl. ¶ 118.) This claim fails as to Grit for myriad
reasons.
First, it is well established that “there is no independent cause of action for civil conspiracy
in Indiana. Rather, conspiracy may be a vehicle for recovery of damages from additional
defendants if the plaintiff can establish that the defendants acted in concert with another party in
3
Case 1:21-cv-00550-RLY-MJD Document 28 Filed 04/28/21 Page 4 of 8 PageID #: 206
the commission of an independent tort.” Snyder v. Smith, 7 F. Supp. 3d 842, 876 (S.D. Ind. 2014)
(citation omitted, emphasis added); see also Newland Resources, LLC v. Branham Corp., 918
N.E.2d 763, 776 (Ind. Ct. App. 2009) (holding “civil conspiracy is not an independent cause of
action”; affirming dismissal of conspiracy claim). Where the alleged conspiracy merely reiterates
acts encompassed by other claims, the “conspiracy claim would clearly be duplicative,” and should
be dismissed. Snyder, 7 F. Supp. 3d at 877 (dismissing conspiracy claim that “adequately alleges
concerted action only against two defendants [] whose joint misconduct is already encompassed
by [another] claim”); see also Powell v. City of Berwyn, 68 F.Supp.3d 929, 950 (N.D. Ill. 2014
(where a conspiracy claim “does not allege any additional defendants or facts” beyond the claims
for the underlying misconduct, it is duplicative); Mission Measurement Corp. v. Blackbaud, Inc.,
287 F.Supp.3d 691, 725-26 (N.D. Ill. 2017) (similar, gathering cases).
This is precisely the case here. Watch’s alleged conspiracy does not pertain to “additional”
defendants, but merely reiterates the same conduct underlying its other counts against the exact
same parties. Thus, even assuming arguendo that Watch has sufficiently asserted some concerted
action, Count VII is entirely duplicative, and should be dismissed on that basis alone as to all five
Second, as set forth herein, Watch has failed to state a claim for any underlying tort or
breach of contract. This too requires dismissal of the conspiracy claim because there can be no
liability for conspiracy without such underlying misconduct. See Snyder, 7 F. Supp. 3d at 877-78;
Meridian Fin. Advisors, Ltd. v. Pence, 763 F. Supp. 2d 1046, 1066 (S.D. Ind. 2011) (“civil
4
Case 1:21-cv-00550-RLY-MJD Document 28 Filed 04/28/21 Page 5 of 8 PageID #: 207
Third, Watch claims that Grit conspired “to start a competing business.” (Cmpl. ¶ 118.)
This is plainly nonsensical; Grit is the supposedly competing business and could not have
participated in any conspiracy to “start” itself. Any such claim should be dismissed with prejudice.
Fourth, Grit cannot conspire with its own agents and employees as a matter of black-letter
law. As the Seventh Circuit noted approvingly, “Many cases hold that a corporation cannot be
liable for a conspiracy with one of its own employees. The reasoning is that a corporation can only
act and speak through an agent, and the effect of charging a conspiracy between the two is to
charge a conspiracy by a single party.” Pearson v. Youngstown Sheet & Tube Co., 332 F.2d 439,
442 (7th Cir. 1964) (citation omitted, emphasis added).1 The Southern District of Indiana granted
a motion to dismiss on similar grounds in Elder Care Providers of Ind., Inc. v. Home Instead, Inc.,
2015 WL 13632962, *4 (S.D. Ind. Dec. 10, 2015), holding that the intracorporate conspiracy
doctrine establishes that a “corporation cannot conspire with an agent when that agent is acting
within the scope of his authority” and thus the plaintiff failed to state a claim that the defendant
company conspired with its own officers. See also Tilbury v. City of Fort Wayne, 471 N.E.2d
1183, 1186 (Ind. Ct. App 1984) (affirming judgment on the pleadings because individual
defendants were all City employees and the City could not “scheme, contract or combine with
itself”).
Here, Watch has pled itself out of court by alleging that (a) all four individual Defendants
are Grit officers and/or employees (Cmpl. ¶¶ 7, 15, 35, 41, 47) and (b) they conspired with Grit to
“directly compete against Watch[.]” (Id. ¶ 118.) This fails to state a claim as a matter of law
1
A litany of cases apply the intracorporate conspiracy doctrine to limited liability companies and note that the same
reasoning applies. See Ebonite Int’l, Inc. v. Hickland, 2018 WL 2107779, *3-4 (W.D. Ky. May 7, 2018)
(intracorporate conspiracy doctrine applied to claim alleging an LLC conspired with its member; dismissing for failure
to state a claim); Green v. Skyline Highland Holdings LLC, 2017 WL 10607256, *3 (E.D. Ar. Dec. 13, 2017) (same);
Bryant v. QuiBids LLC, 2012 WL 394154, *5 (N.D. Ill. Feb. 3, 2012) (same).
5
Case 1:21-cv-00550-RLY-MJD Document 28 Filed 04/28/21 Page 6 of 8 PageID #: 208
because a principal cannot conspire with its agents and employees, and Count VII should be
dismissed with prejudice for this reason as well. Pearson, 332 F.2d at 442; Elder Care, 2015 WL
13632962, *4.
unfairly with Watch under Indiana common law through “use in interstate commerce of Watch’s
trade secrets and proprietary information, as well as its [sic] false representations of an affiliation
with Watch as alleged herein[.]” This, too, fails for several reasons.
First, Count VIII is entirely duplicative and merely reiterates the same allegations
undergirding prior counts. Where a common law unfair competition claim “contains no new
allegations” and “fails to allege any wrongdoing not encompassed … elsewhere in the[]
complaint,” a court should “dismiss it as duplicative.” Heckler & Koch, Inc. v. German Sport
Guns GmbH, 2013 WL 12291720, *12 (S.D. Ind. Sept. 27, 2013) (dismissing unfair competition
claim as duplicative); see also Arbor Pharm., LLC v. ANI Pharm., Inc., 2018 WL 3677923, *5 (D.
Minn. Aug. 2, 2018) (“where an unfair competition claim is duplicative of another claim, the unfair
competition claim should be dismissed”; dismissing same); Zimmerman Grp., Inc. v. Fairmont
Foods of Minn., Inc., 882 F. Supp 892, 895 (D. Minn. 1994) (similar); Fraklin Elec. Pub., Inc. v.
Unisonic Prods. Corp., 763 F. Supp. 1, 5 (S.D.N.Y. 1991) (similar). Indeed, just weeks ago, the
Southern District of Indiana dismissed an unfair competition claim because it was entirely
duplicative in The Hartford Steam Boiler Inspection and Ins. Co. v. Campbell, 2021 WL 1225951,
Second, the IUTSA provides that it “displaces all conflicting law of this state pertaining to
the misappropriation of trade secrets, except contract law and criminal law.” Ind. Code § 24-2-3-
6
Case 1:21-cv-00550-RLY-MJD Document 28 Filed 04/28/21 Page 7 of 8 PageID #: 209
1(c). The Indiana Court of Appeals explicitly held that the IUTSA therefore preempts common
law causes of action based on misappropriating information, whether or not that information is
actually secret. HDNet LLC v. N. Am. Boxing Council, 972 N.E. 2d 920, 925-26 (Ind. Ct. App.
2012). The Southern District of Indiana dismissed an unfair competition claim on this basis in
Konecranes, Inc. v. Davis, 2013 WL 1566326, *4 (S.D. Ind. Apr. 12, 2013), holding:
(Internal citations omitted, quoting HDNet, 972 N.E. 2d at 925); see also Hartford Steam, 2021
preempted); Aegean, LLC v. Meridian Senior Living, LLC, 2019 WL 4142880, *5-6 (S.D. Ind.
Aug. 30, 2019) (similar). Watch’s unfair competition claim should therefore be dismissed with
prejudice because it is preempted by the IUTSA under Indiana law to the extent it is premised on
Third, there is plainly no contractual basis for an unfair competition claim as to Grit, which
is a legal stranger to Watch. Thus, there can be no unfair competition claim based on a breach of
CONCLUSION
For all of the foregoing reasons, Grit respectfully asks this Court to dismiss Counts I, VII
and VIII against it in full and with prejudice, and to grant such further relief as may be appropriate.
7
Case 1:21-cv-00550-RLY-MJD Document 28 Filed 04/28/21 Page 8 of 8 PageID #: 210
and
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that a copy of the foregoing Memorandum in Support of Motion to
Dismiss was filed electronically this 28th day of April, 2021. Notice of this filing will be sent to
all parties registered to receive such notice by operation of the Court’s electronic filing system.