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Applied Underwriters, Inc. v. Lichtenegger

United States District Court, E.D. California

July 5, 2017

APPLIED UNDERWRITERS INC., a Nebraska corporation, Plaintiff,
v.
LARRY LICHTENEGGER, J. DALE DEBBER, both individuals, and PROVIDENCE PUBLICATIONS, LLC, a California limited liability company, Defendants.

          ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' REQUEST FOR JUDICIAL NOTICE AND GRANTING DEFENDANTS' MOTION TO DISMISS

          Troy L. Nunley United, States District Judge.

         The matter is before the Court on Defendant Providence Publications, LLC (“Providence Publications”), Larry J. Lichtenegger (“Lichtenegger”), and J. Dale Debber's (“Debber”), (collectively, “Defendants”) Motion to Dismiss and Request for Judicial Notice. (ECF Nos. 13 & 14.) Providence Publications and Debber originally moved to dismiss and Lichtenegger later joined that motion. (ECF Nos. 13 & 28.) Plaintiff Applied Underwriters, Inc. (“Plaintiff”) opposes the motion and the request. (ECF Nos. 19 & 20.) For the reasons detailed below, the Court GRANTS in part and DENIES in part Defendants' request for judicial notice (ECF No. 14) and GRANTS Defendants' motion to dismiss (ECF No. 13).

         I. Factual and Procedural Background

         Plaintiff sells workers' compensation insurance programs to businesses. (ECF No. 1 ¶¶ 15 & 16.) Plaintiff alleges that it has been using the trademarks, Applied Underwriters and EquityComp (collectively, the “Trademarks”), since 2001 and 2002, respectively, to sell financial services relating to workers' compensation programs to brokers and their business clients. (ECF No. 1 ¶¶ 14-16.) Plaintiff also alleges that the United States Patent and Trademark Office issued federal trademark registrations to Plaintiff for the Trademarks. (ECF No. 1 ¶ 17 & Ex. A.) Plaintiff contends that it has spent millions of dollars advertising the Trademarks in connection with its services - including nearly $4 million in 2015. (ECF No. 1 ¶¶ 18 & 19.) Plaintiff asserts the Trademarks possess significant goodwill and are famous. (ECF No. 1 ¶ 20.)

         Defendants produce a seminar, available on DVD and webcast, that is critical of one of Plaintiff's insurance programs, “EquityComp.” (ECF No. 1 ¶ 23 & Ex. B.) Defendants' seminar is titled, “Applied Underwriters' EquityComp Program, Like it, Leave it, or Let it be? Learn the best strategies for selling, competing with, or helping a prospect out of EquityComp mid-term.” (ECF No. 1, Ex. B.) Plaintiff alleges that Defendants' use of Plaintiff's company name, Applied Underwriters, and of the program name, EquityComp, in Defendants' seminar's title and related advertising infringes and dilutes the value of the Trademarks. (ECF No. 1 ¶¶ 24-27.)

         Plaintiff alleges that Defendants operate a website for Providence Publications as well as another website, Workers' Comp Executive. (ECF No. 1 ¶ 24.) Plaintiff alleges that Defendants advertise their seminar in promotional email sent to potential attendees, including those who use Plaintiff's services. (ECF No. 1 ¶¶ 24 & 25.) Plaintiff alleges that the email includes a list of topics the seminar will address, including: how to sell the program and to compete against it; what agreements employers and their lawyers must review and sign before offering the program; whether the program is legal in California; and the concept of “unconscionability.” (ECF No. 1, Ex. B.) Plaintiff alleges that the email refers to news articles about the “controversial” program, Debber's role as a journalist who “broke the recent spate of stories about Applied Underwriters' EquityComp Program, ” and Lichtenegger's role as an attorney representing employers against Plaintiff. (ECF No. 1, Ex. B.)

         Plaintiff asserts five claims: trademark infringement; trademark dilution; violation of the Lanham Act; and federal and state law unfair competition. (ECF No. 1 ¶ 1 & 43.) Defendants move to dismiss all five claims and for the Court to take judicial notice of a DVD of the seminar, four web pages, and articles related to Applied Underwriters. (ECF Nos. 13 at 2-3; 14 at 2-3.)

         II. Request for Judicial Notice

         In conjunction with Defendants' motion to dismiss, Defendants request that the Court take judicial notice of the following: a DVD of Defendants' seminar referenced in Plaintiff's complaint; a screen shot of the home page of the Providence Publications website; screen shots of three web pages from Defendants' Workers' Comp Executive website - the home page, the About Us page, and a list of available webcasts; and copies of six articles published on the Workers' Comp Executive website. (ECF No. 14 at 2-3.)

         “As a general rule, a district court may not consider any material beyond the pleadings in ruling on a Rule 12(b)(6) motion.” Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001) (internal quotation omitted). When a court considers material outside the pleading in deciding a motion to dismiss for failure to state a claim, the motion becomes a motion for summary judgment. Id., Fed.R.Civ.P. 12(b)(6). Two exceptions exist: one for material attached to the complaint or referred to in the complaint if the complaint necessarily relies on that material and its authenticity and relevance are not disputed, Coto Settlement v. Eisenberg, 593 F.3d 1031, 1038 (9th Cir. 2010), and one for matters subject to judicial notice pursuant to Federal Rule of Evidence 201. Lee, 250 F.3d at 688-89 (citing Fed.R.Evid. 201).

         Plaintiff does not oppose Defendants' request for judicial notice of the DVD. In its complaint, Plaintiff relies on the existence of the DVD, the DVD's title, and the related advertising. (ECF No. 1 ¶¶ 23-24.) Accordingly, the Court GRANTS Defendants' request and takes judicial notice of the DVD (ECF No. 14, Ex. 1). Coto Settlement, 593 F.3d at 1038.

         Regarding the screen shot of the Providence Publications home page, Plaintiff has not opposed this request. Plaintiff does refer to the Providence Publications website in its complaint as a location where viewers can access the webcast, but does not mention the home page. (ECF No. 1 ¶¶ 24, 47.) Even so, “the mere mention of the existence of a document is insufficient to incorporate the contents of a document.” Coto Settlement, 593 F.3d at 1038. The mention of the website is brief and Plaintiff does not necessarily rely on either the existence of the home page or the contents of that home page. The Court DENIES Defendants' request to take judicial notice of the screen shot of the Providence Publications home page (ECF No 14, Ex. 2).

         Regarding screen shots of the Workers' Comp Executive home page, About Us page, and webcasts list, Plaintiff referred to the website in its complaint as a location where viewers can access the webcast. (ECF No. 1 ¶¶ 13, 24 & 47.) Plaintiff did not discuss these pages and does not necessarily rely on the existence or content of these pages. Coto Settlement, 593 F.3d at 1038.

         Further, Plaintiff asserts the material is not accurate because the content of those pages has been altered since Plaintiff filed its complaint. (ECF No. 20 at 4-5.) Plaintiff points to alternate screen shots it claims show the content of the pages as they were when Plaintiff filed its complaint and describes changes made to the pages. (ECF No. 20 at 4-5.) The Court finds that the three Workers' Comp Executive web pages cannot be “accurately and readily determined from sources whose accuracy cannot reasonably be questioned.” See Fed.R.Evid. 201; Fraley v. Facebook, Inc., 830 F.Supp.2d 785, 795 (N.D. Cal. 2011) (declining to take judicial notice of web pages accessed after the events giving rise to the suit because the pages may not have been in existence or contained the same content during the relevant time period).

         To the extent Defendants provided the screen shots to show the current content rather than the content of the pages at the time Plaintiff filed its complaint, Defendants have not explained the relevance. Accordingly, the Court DENIES Defendants' request to take judicial notice of the screen shots of the three Workers' Comp Executive web pages (ECF No. 14, Exs. 3 & 10).

         Finally, Defendants request that the Court take judicial notice of six articles published on Defendants' Workers' Comp Executive website “illustrating news reporting about Plaintiff Applied Underwriters' EquityComp insurance programs, ” and showing that Defendants are not competitors of Plaintiff. (ECF Nos. 14 ¶¶ 4-9; 21 at 22.) Defendants do not site legal authority which supports this request. Defendants do cite several cases in which courts considered material that expanded on or provided context for material on which the plaintiff relied in its complaint. (ECF No. 14 at 3.)

         The court in Burnett v. Twentieth Century Fox, 491 F.Supp.2d 962 (CD. Cal. 2007) reviewed a larger portion of a television show, a few second clip of which formed the basis of the complaint. Id. at 973. Similarly, the court in Knieval v. ESPN,393 F.3d 1068 (9th Cir. 2005), reviewed the web pages a viewer must access and click through to view the single image and caption that were the basis of that defamation suit. Id. at 1076-77. In another case, the court took notice of three documents the plaintiff explicitly referred to in its complaint, but declined to take notice of a ...


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