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Connectus LLC v. Ampush Media, Inc.

United States District Court, M.D. Florida, Tampa Division

March 28, 2017

CONNECTUS LLC, Plaintiff,
v.
AMPUSH MEDIA, INC., et al., Defendants.

          ORDER

          VIRGINIA M. HERNANDEZ COVINGTON UNITED STATES DISTRICT JUDGE

         This matter comes before the Court in consideration of Defendants Ampush Media, Inc. and DGS Edu, LLC's Joint Motion to Partially Strike/Dismiss Plaintiff's Third Amended Complaint (Doc. # 206), filed on February 9, 2017, and Defendants' Joint Motion to Strike Jury Demand (Doc. # 214), filed on February 23, 2017. Plaintiff Connectus LLC filed responses in opposition on February 23, 2017, and March 9, 2017, respectively. (Doc. ## 213, 219). For the reasons below, both Motions are denied.

         I. Background

         A detailed recounting of this action's history is not needed to dispose of the instant Motions. Suffice it to say, Connectus's Second Amended Complaint brought claims for conversion, misappropriation of trade secrets under Florida law, unfair competition, unjust enrichment, breach of contract, and injunctive relief. (Doc. # 106). The claim for misappropriation of trade secrets under Florida law sought, among other things, injunctive relief. (Id. at 9). And, as with the earlier versions, Connectus's Second Amended Complaint included a demand for a jury trial. (Id. at 13).

         Thereafter, DGS Edu and Ampush filed Rule 12(c) motions. (Doc. ## 114, 115). After being fully briefed, the Court made the following relevant rulings: (1) California law governed in accordance with the parties' agreement; (2) Connectus's common-law claims for conversion, unfair competition, and unjust enrichment were dismissed as preempted; (3) Connectus's stand-alone claim for injunctive relief was improper under California law; and (4) Connectus could file a third amended complaint that pled the trade-secrets claim under California law and could amend its breach-of-contract claim to include a claim for injunctive relief. (Doc. # 188 at 31-32).

         Connectus timely filed its Third Amended Complaint. (Doc. # 200). The Third Amended Complaint asserts only two claims; namely, a claim under California's Uniform Trade Secrets Act, Cal. Civ. Code § 3426.1(d), (CUTSA) and a claim for breach of contract. (Id.). As with the Second Amended Complaint, Connectus's trade-secrets claim seeks injunctive relief. (Id. at 8). The Third Amended Complaint also contains a demand for a jury trial. (Id. at 10).

         Attached to the Third Amended Complaint is the parties' agreement. (Doc. # 200-1). Paragraph 6 of that agreement reads:

         GOVERNING LAW & ATTORNEYS' FEES

The interpretation and construction of this Agreement and all matters relating hereto shall be governed by the laws of the State of California. The parties hereby submit to the jurisdiction of, and waive any venue objections against, the United States District Court for the Northern District of California, San Francisco County Branch and the Superior and Municipal Courts of the State of California. Each of the parties agrees that it shall not seek a jury trial in any proceeding based upon or arising out of or otherwise related to this Agreement or any of the other documents and instruments contemplated hereby and each of the parties hereto waives any and all right to such jury trial. AMPUSH and VENDOR[, i.e., Connectus, ] acknowledge that the foregoing waiver is knowing and voluntary. The prevailing party shall be awarded its reasonable attorneys' fees and costs in any lawsuit arising out of or related to this Agreement.

(Id. at ¶ 6) (emphasis added).

         DGS Edu and Ampush now seek to strike or dismiss portions of the Third Amended Complaint. In particular, Defendants seek to (1) strike paragraphs 39-42 and 46-49 of the Third Amended Complaint for putatively violating the Court's previous Order; (2) as an alternative to the first request, dismiss paragraphs 39-42 and 46-49 of the Third Amended Complaint; (3) dismiss the CUTSA claim; and (4) strike Connectus's jury demand. Connectus responded in opposition.

         II. Standard

         A. Rule 12(f)

         “The court may strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.” Fed.R.Civ.P. 12(f). A court may act sua sponte or “on motion made by a party either before responding to the pleading or, if a response is not allowed, within 21 days after being served with the pleading.” Id. “Motions to strike are considered ‘drastic' and are disfavored by the courts.” Gyenis v. Scottsdale Ins. Co., No. 8:12-cv-805-T-33AEP, 2013 WL 3013618, at *1 (M.D. Fla. June 14, 2013) (quoting Thompson v. Kindred Nursing Ctrs. E., LLC, 211 F.Supp.2d 1345, 1348 (M.D. Fla. 2002)).

         B. Rule 12(b)(6)

         On a motion to dismiss, this Court accepts as true all the allegations in the complaint and construes them in the light most favorable to the plaintiff. Jackson v. Bellsouth Telecomms., 372 F.3d 1250, 1262 (11th Cir. 2004). Further, this Court favors the plaintiff with all reasonable inferences from the allegations in the complaint. Stephens v. Dep't of Health & Human Servs., 901 F.2d 1571, 1573 (11th Cir. 1990) (stating “[o]n a motion to dismiss, the facts stated in [the] complaint and all reasonable inferences therefrom are taken as true”). However:

[w]hile a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do. Factual allegations must be enough to raise a right to relief above the speculative level.

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal citations omitted). Courts are not “bound to accept as true a legal conclusion couched as a factual allegation.” Papasan v. Allain, 478 U.S. 265, 286 (1986).

         C. Jury Trial: Right and Waiver, in General

         “The Seventh Amendment provides ‘[i]n Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved.'” Chauffeurs, Teamsters & Helpers, Local No. 391 v. Terry, 494 U.S. 558, 564 (1990) (quoting U.S. Const. amend. VII). A party may waive its right to a jury trial if the waiver is knowing and voluntary. Bakrac, Inc. v. Villager Franchise Sys., Inc., 164 Fed.Appx. 820, 823 (11th Cir. 2006). However, because of the historical importance of this right, “any seeming curtailment . . . should be scrutinized with the utmost care.” Chauffers, 494 U.S. at 565 (internal citations omitted). Furthermore, “because the right to a jury trial is fundamental, courts must indulge every reasonable presumption against waiver.” Burns v. Lawther, 53 F.3d 1237, 40 (11th Cir. 1995) (per curiam) (internal quotations omitted).

         III. Analysis

         A. Compliance with the Court's Order

         Defendants argue that paragraphs 39-42 and 46-49 of the Third Amended Complaint should be stricken for failure to comply with the Court's January 20, 2017, Order. Connectus contends its Third Amended Complaint fully complies with the Court's Order.

         In pertinent part, the Second Amended Complaint brought a claim for misappropriation of trade secrets under Florida law that sought injunctive relief. (Doc. # 106 at 8-9). The Second Amended Complaint also brought a stand-alone claim for injunctive relief. (Id. at 11-13). Defendants moved for judgment on the pleadings; in particular, DGS Edu sought to have the trade-secrets claim dismissed for being improperly brought under Florida law (Doc. # 114 at 21) and Ampush sought to have the stand-alone claim for injunctive relief dismissed (Doc. # 115 at 12-13). The Court agreed the trade-secrets claim was improperly brought under Florida law, but it also granted Connectus leave to replead the claim under California law. (Doc. # 188 at 30). Further, while the Court agreed the claim for injunctive relief could not stand alone, the Court granted Connectus leave to include such a claim to relief in its breach-of-contract claim. (Id.).

         A review of the Third Amended Complaint shows that Connectus merely transferred its allegations from the standalone claim for injunctive relief as pled in the Second Amended Complaint into the claims for misappropriation of trade secrets and breach of contract as pled in the Third Amended Complaint. Compare (Doc. # 106 at ¶¶ 66-69), with (Doc. # 200 at ¶¶ 39-42, 46-49). The trade-secrets claim as pled in the Second Amended Complaint explicitly sought injunctive relief and Defendants were on notice from the beginning of this action that Connectus would be seeking injunctive relief, as well as the grounds for that relief. (Doc. # 188 at 26-27). In light of the various iterations of the complaint and the Court's January 20, 2017, Order, the Court finds that the Third Amended Complaint complies with the Court's directive. Accordingly, the Court declines to strike paragraphs 39-42 and 46-49 of the Third Amended Complaint.

         B. Round 1: Standing and ...


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