MIGLIORE & ASSOCIATES, LLC AND LISA MIGLIORE BLACK, Plaintiffs,
KENTUCKIANA REPORTERS, LLC, Defendant.
MEMORANDUM OPINION AND ORDER
JOHN G. HEYBURN, II, District Judge.
Plaintiffs Migliore & Associates, LLC ("Migliore & Associates") and Lisa Migliore Black (together "Plaintiffs") bring this action against competitor Kentuckiana Reporters, LLC ("Kentuckiana") alleging violations of the Lanham Act (15 U.S.C. § 1125(a)), the Anticybersquatting Consumer Protection Act ("ACPA, " 15 U.S.C. § 1125(d)), and Kentucky common law banning unfair competition practices.
Defendant has moved to dismiss each of Plaintiffs' three claims under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. Defendant also moves to dismiss Lisa Migliore Black in her personal capacity as an improper plaintiff. Plaintiffs object to the motion to dismiss and cross-motion to amend the complaint, in part to correct for some of the inadequacies highlighted in Defendant's arguments. The Court addresses each request in turn after a brief overview of the underlying facts.
Lisa Migliore began working as a court reporter in the greater Louisville area in 1997. In 2001, Migliore established the Kentucky LLC "Migliore & Associates, " conducting business as its sole member. In 2009, Migliore married. Because of the name recognition and goodwill her maiden name had accrued in the community, she chose to retain "Migliore" as part of her married name and did not alter the name of the business.
In August 2011, Kentuckiana Reporters, a Louisville-based competitor, registered the domain name "lisamigliore.com" with GoDaddy.com, LLC. At some point after registration, Defendant directly linked "lisamigliore.com" to its own website, rerouting any web traffic to itself. Following a letter from Plaintiffs' counsel dated June 19, 2012, Kentuckiana discontinued the re-direction to its own website, but refused to transfer the domain name to Plaintiffs.
In August 2012, Plaintiffs proceeded under the Uniform Dispute Resolution Policy and filed a complaint with an arbitral panel of the World Intellectual Property Organization Arbitration and Media Center ("WIPO"). Defendant participated in this action, maintaining that it had registered the disputed domain name for possible use as a "gripe site" for criticism of Plaintiffs or as a "fact check site" regarding Plaintiffs' public statements (WIPO decision, p.3). The WIPO Arbitrator assigned to the case ultimately concluded that Defendant acted in bad faith in its registration and use of the domain name and ordered the transfer of the domain name to the Plaintiffs. After Defendant refused to reimburse Plaintiffs for costs associated with the WIPO dispute, Plaintiffs filed the instant action in federal court.
Kentuckiana moves to dismiss each of Plaintiffs' three claims under Federal Rule of Civil Procedure 12(b)(6). "To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.' A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)) (internal citation omitted). When reviewing Kentuckiana's motion, the Court will construe the complaint liberally and in the light most favorable to Plaintiffs, accepting as true all well-pleaded factual allegations and drawing all reasonable inferences from those allegations in favor of the non-moving party. Bishop v. Lucent Techs., Inc., 520 F.3d 516, 519 (6th Cir. 2009); Logsdon v. Hains, 492 F.3d 334, 340 (6th Cir. 2007).
First, Defendant urges the Court to dismiss Count I (cyberpiracy under the ACPA, 15 U.S.C. §1125(d)) and Count II (false designation of origin and false advertising under §43(a), codified at 15 U.S.C. 1125(a)) because "actual damages are required to sustain a cause of action under the Lanham Act" and "plaintiffs failed to sufficiently plead that they were damaged by Kentuckiana's alleged conduct." (MTD, Dock. No. 12-1, p.3-4). Though Kentuckiana levies the same attack against both Counts I and II, and though the same facts form the basis for each claim, the elements that comprise the claims are distinct, hence the Court will address Kentuckiana's attack on each claim separately.
To establish a claim of cyberpiracy under the Anticybersquatting Consumer Protection Act, 15 U.S.C. § 1125(d)(1)(A) a plaintiff must show that a defendant registered, trafficked in, or used in bad faith a domain name that incorporates a famous or distinctive mark, including a personal name, if that mark was famous or distinctive at the time of registration. The facts alleged in the complaint, taken as true, satisfy each of the statutory requirements to render the claim to relief "plausible on its face." Iqbal, 556 U.S. at 678 (internal references omitted). Defendant complains that "plaintiffs failed to sufficiently plead that they were damaged by Kentuckiana's alleged conduct and, therefore, fail to state a cause of action under Count I... of their complaint." (MTD, Dock. No. 12-1, p.4). This argument fails for the multiple reasons.
First, proof of damages is not part of the prima facie case for cyberpiracy. Section 1125(d) of 15 U.S.C. lays out the elements of the offense of cyberpiracy, while two separate sections of the Lanham Act, 15 U.S.C. § 1117(a) and § 1117(d), detail the array of remedies available to successful cyberpiracy claimants. Section 1117(a) allows a successful plaintiff to recover-subject to principles of equity-"(1) defendant's profits, (2) any damages sustained by the plaintiff, and (3) the costs of the action." In "exceptional cases, " attorney's fees are available as well.
As an alternative to recovery under § 1117(a), § 1117(d) provides for the election of statutory damages in cyberpiracy actions: "In a case involving a violation of [the ACPA], the plaintiff may elect at any time before final judgment is rendered by the trial court to recover, instead of actual damages and profits, an award of statutory damages in the amount of not less than $1, 000 and not more than $100, 000 per domain name, as the court considers just." 15 U.S.C. § 1117(d) (emphasis added). Thus, to the extent Kentuckiana faults the complaint for being "silent as to how ...