Infringement Claims Against Corporate Officers Require Active Participation

Posted on July 1, 2011 by R. David Donoghue

Free Green Can, LLC v. Green Recycling Enters., LLC, No. 10 C 5764, Slip Op. (N.D. Ill. Jan. 28, 2011 (Coleman, J.).

Judge Coleman granted the individual defendants' and Aslan Financial Group's Fed. R. Civ. P. 12(b) motion to dismiss plaintiff Free Green Can's trademark infringement and related state law claims. As an initial matter, the Court lacked subject matter jurisdiction as to all state law claims because while Free Green Can pled diversity of citizenship, it did not plead that the amount in controversy exceeded $75,000. Because Aslan Financial Group was only accused of state law claims, it was dismissed.

The federal trademark claims against the individual defendants were dismissed pursuant to Fed. R. Civ. P. 12(b)(6) because the individual defendants were accused of infringement based upon corporate acts of defendant Green Recycling Enterprises, of which each was an officer. But in order to state a claim for infringement, or any tort, by corporate officers or employees Free Green Can was required to allege each individual defendant had actively participated in the tortious acts. Because there were no such allegations, the infringement claims were dismissed.
 

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Jurisdiction: Amount in Controversy Must be Tied to Alleged Wrongs

Posted on April 14, 2008 by R. David Donoghue

Integrated Genomics, Inc. Kyrsides, No. 06 C 6706, 2008 WL 63065 (N.D. Ill. Mar. 4, 2008) (Lefkow, J.).

Judge Lefkow dismissed defendant Ivanova for lack of subject matter jurisdiction, held that the Court had subject matter jurisdiction over defendant Kyrsides, and denied defendants' Fed. R. Civ. P. 12(b)(6) motion to dismiss plaintiff's claims based upon preemption. Plaintiff alleged that defendants' breached their non-compete agreements and otherwise named plaintiff when defendants resigned from plaintiff, where they worked with genome software, and joined plaintiff's competitor in similar roles. Defendants each argued that plaintiff had not sufficiently pled diversity jurisdiction because plaintiff had not shown that $75,000 or more was in controversy. In response, plaintiff alleged that they lost customers to defendants' new employer after defendants resigned. But that was insufficient because plaintiff did not allege that defendants were responsible for, or the cause of, those lost customers. The Court, therefore, dismissed defendant Ivanova. But for Kyrisides, plaintiff also relied upon an email sent from Kyrsides to plaintiff's employees explaining Krysides's view that his resignation cost plaintiff a very large number of contracts. Kyrsides statements were sufficient proof that the amount in controversy exceeded $75,000.

The Court held that a motion to dismiss was not the appropriate vehicle for deciding the scope of the relevant non-compete agreements. The scope of a non-compete was fact-intensive and best determined after additional discovery.

Finally, the Court held that plaintiff's claims were not preempted by the Illinois Trade Secret Act ("ITSA"). While the claims could encompass trade secret information, they were based upon the broader category of confidential information. Because the claims were potentially broader than trade secrets, they were not preempted.

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