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Skedko, Inc. v. Arc Products, LLC

United States District Court, D. Oregon, Portland Division

June 2, 2014

SKEDKO, INC., an Oregon corporation, Plaintiff,
v.
ARC PRODUCTS, LLC, a Missouri limited liability company, d/b/a MEDSLED, Defendant.

OPINION AND ORDER

ANCER L. HAGGERTY, District Judge.

SKEDCO, Inc. ("plaintiff" or "SKEDCO") filed this action against ARC Products, LLC ("defendant" or "Medsled") for false advertising in violation of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), and unfair competition in violation of common law. On March 5, 2014, defendant filed an Amended Answer [33], which included counterclaims for false advertising under Section 43(a) of the Lanham Act and for attorney fees. Plaintiff moves to dismiss defendant's counterclaims pursuant to Federal Rule of Civil Procedure (FRCP) 12(b)(6) and FRCP 9(b). For the following reasons, plaintiff's Motion to Dismiss [34] is denied.

BACKGROUND

Plaintiff is an Oregon corporation that manufactures and sells emergency medical rescue equipment, and its leading product is the Sked® Rescue System (''Sked"), an evacuation sled system designed to quickly evacuate wounded people from confined spaces, from high angles, in technical rescues, and in traditional land-based rescues.

Defendant is a Missouri company that also manufactures and sells emergency transportation and evacuation devices. Of particular relevance to this case, defendant manufactures and sells the Vertical Lift Rescue Sled ("VLR Sled"), which is an evacuation device that provides quick transpmi of a nonambulatory individual in a difficult rescue situation or a confined space.

On April 24, 2013, plaintiff filed this lawsuit, alleging that defendant has used false and misleading advertising in brochures, in films, in presentations, and on the Internet that compare the VLR Sled and the Sked. Based on these misrepresentations, plaintiff asserts that defendant engaged in false advertising in violation of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a) and unfair competition in violation of Oregon common law.

On November 11, 2013, defendant filed its Answer (24], which included counterclaims. Defendant alleges that plaintiff violated Section 43(a) of the Lanham Act by promoting its product through the use of false and misleading statements. On February 13, 2014, this court issued an Opinion and Order (30] dismissing defendant's counterclaims without prejudice. In that Opinion and Order the court found that because defendant's counterclaims "sound[ed] in fraud", they must satisfy the particularity requirements of FRCP 9(b) and they failed to do so.

On March 5, 2014, defendant filed an Amended Answer (33]. On March 19, 2014, plaintiff filed a second Motion to Dismiss [34), arguing that defendant's amended counterclaims still fail to satisfy Rule 9(b) and fail as a matter of law.

STANDARDS

To survive a motion to dismiss under FRCP 12(b)(6), a complaint must allege sufficient facts to state a claim for relief that is plausible on its face. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). When considering a motion to dismiss, the court must determine whether the plaintiff has made factual allegations that are "enough to raise a right to relief above the speculative level." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 545 (2007). Dismissal under Rule 12(b)(6) is proper only where there is no cognizable legal theory, or an absence of sufficient facts alleged to support a cognizable legal theory. Shroyer v. New Cingular Wireless Servs., Inc., 622 F.3d 1035, 1041 (9th Cir. 2010).

As this court ruled in its Opinion and Order [30), dated February 13, 2014, the counterclaims at issue in this Motion to Dismiss must satisfy the heightened pleading requirements of FRCP 9(b). Rule 9(b) requires that "[i]n alleging fraud or mistake, a party must state with particularity the circumstances constituting fraud or mistake." To comply with Rule 9(b), the complaint must state with particularity the circumstances constituting the fraud, including an account of the "time, place, and specific content of the false representations as well as the identities of the parties to the misrepresentation." Edwards v. Marin Park, Inc., 356 F.3d 1058, 1066 (9th Cir.2004). "[A]llegations of fraud must be specific enough to give defendants notice of the particular misconduct which is alleged to constitute the fraud charged so that they can defend against the charge and not just deny that they have done anything wrong.'" Bly-Magee v. California, 236 F.3d 1014, 1019 (9th Cir. 2001).

The reviewing court must treat all facts alleged in the couterclaim as true and resolve all doubts in favor of the nonmoving party. Barnes v. Yahoo!, Inc., 570 F.3d 1096, 1098 n.1 (9th Cir. 2009) (citation omitted). The court need not accept any legal conclusions set forth in a counterclaim pleading. Ashcroft, 556 U.S. at 678.

ANALYSIS

Plaintiff's motion attacks three specific counterclaims. The court will analyze ...


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