WRENCH LLC v. TACO BELL CORP.No. 1:98-CV-45.
36 F.Supp.2d 787 (1998)
WRENCH LLC, a Michigan Limited Liability Company; Joseph Shields; and Thomas Rinks, Plaintiffs,
TACO BELL CORP., a foreign corporation, Defendant.
TACO BELL CORP., a foreign corporation, Defendant.
United States District Court, W.D. Michigan, Southern Division.
November 16, 1998.
Douglas A. Dozeman, Valerie Ann Pierre Simmons, Warner, Norcross & Judd, LLP, Grand Rapids, MI, for Wrench LLC, Joseph Shields, Thomas Rinks. Richard J. O'Brien, Sidley & Austin, Chicago, IL, Randall G. Litton, Price, Heneveld, Cooper, Dewitt, et al, Grand Rapids, MI, Arthur S. Friedman, Friedman, Wang & Bleiberg, PC, New York City, for Taco Bell Corporation.
Eric D. Green, Resolutions, LLC, Boston, MA, for VFM.
QUIST, District Judge.
In this action, Plaintiffs, Wrench LLC ("Wrench"), Joseph Shields ("Shields"), and Thomas Rinks ("Rinks"), allege that Defendant, Taco Bell Corp. ("Taco Bell"), misappropriated their creative images, ideas, concepts, and designs for its own use without compensating them for use of their property. The alleged property in dispute is Plaintiffs' idea of featuring a live Chihuahua with a feisty attitude to promote Taco Bell food in a series of commercials. Plaintiffs allege that their ideas were inspired by their Chihuahua caricature known as "Psycho Chihuahua." On June 18, 1998, this Court issued an Opinion and Order granting in part and denying in part Taco Bell's motion to dismiss all counts of Plaintiffs' original complaint except Count I. See Wrench LLC v. Taco Bell, No. 98-CV-45, 1998 WL 480871 (W.D.Mich. June 18, 1998). The Court dismissed Counts II (unjust enrichment) and IV (conversion) on the grounds that they were preempted by § 301 of the federal Copyright Act and Count VI (trademark dilution under California law) on the grounds that it failed to state a claim. See id. at *9. The Court denied Taco Bell's motion with respect to Counts III, VII, and VIII. See id. Finally, the Court granted Plaintiffs leave to amend their complaint to allege the elements of a claim for conversion of an idea under Michigan law as set forth in Sarver v. Detroit Edison Co.,
Plaintiffs filed their First Amended Complaint on July 16, 1998. Taco Bell has moved to dismiss Counts II through V of the amended complaint alleging misappropriation, conversion, and unfair competition under Michigan and California law on the grounds that those claims are preempted by the Copyright Act or fail to state a claim upon which relief can be granted. Taco Bell has also moved in the alternative to strike Plaintiffs' allegations of a quasi-contractual relationship from the conversion and misappropriation claims. The facts alleged by Plaintiffs in support of their claims were set forth in the Court's June 18, 1998, Opinion and will not be repeated here as Taco Bell's motion presents only questions of law.
In its motion to dismiss, Taco Bell raises the same arguments it raised in its previous motion to dismiss. The Court agreed with Taco Bell on some of its arguments and rejected others. In the instant motion Taco Bell takes issue with the Court's prior rulings. Therefore, the motion is properly characterized as a motion for reconsideration to the extent that it reasserts legal arguments already raised and decided. See Keweenaw Bay Indian Community v. Michigan, 152 F.R.D. 562, 563 (W.D.Mich.1992), aff'd,
Rule 12(f) of the Federal Rules of Civil Procedure provides that upon motion of a party, the Court may "order stricken from any pleading any insufficient defense or any redundant, immaterial, impertinent, or scandalous matter." Fed.R.Civ.P. 12(f). Courts disfavor motions to strike because they "propose a drastic remedy." Resolution Trust Corp. v. Vanderweele,
I. Motion for Reconsideration
The thrust of Taco Bell's motion is that the Court erred in holding that the addition of a "legal relationship," such as an implied-in-fact or implied-in-law contract, to Plaintiffs' misappropriation, unfair competition, and conversion claims provides the "extra element" needed to save those claims from preemption under § 301(a). The Court set forth the preemption test in its previous Opinion.
Wrench, 1998 WL 480871, at *4.
Taco Bell acknowledges that the Court applied the correct test for preemption and that the Court's conclusion that Plaintiffs' claims fall within the subject matter of copyright was correct. However, Taco Bell contends that the Court erred as a matter of law in holding that the existence of a legal relationship could save Plaintiffs' claims from preemption. Taco bell argues that "[t]he addition of a `legal relationship' to the equation does not change the fact that both an idea misappropriation claim and a copyright infringement claim center on the allegation of unauthorized use of intellectual property." (Def.'s Br. at 8.)
Taco Bell's argument fails to recognize that a substantial number of courts have held that conversion, misappropriation, and other state law tort claims are not preempted where they require proof of a legal relationship, such as a contractual or fiduciary relationship. See, e.g., Computer Assocs. Int'l, Inc. v. Altai, Inc.,
In concluding that Plaintiffs' idea misappropriation claim was not preempted, the Court cited Kienzle v. Capital Cities/American Broadcasting Co.,
II. Motion to Strike
Taco Bell contends that if the Court permits Plaintiffs' misappropriation and conversion claims to stand, it must strike the allegations in paragraphs 50 and 56 of the First Amended Complaint which allege a legal relationship in the form of a quasi-contract. Plaintiffs amended their conversion and misappropriation claims to allege the existence of a quasi-contract after the Court granted them leave to amend their conversion claim to plead a legal relationship "created by express or implied-in-fact contract, quasi-contract, or fiduciary obligation." Wrench, 1998 WL 480871, at *9. Taco Bell contends that allowing Plaintiffs to plead a quasi-contract as a legal relationship is inconsistent with the Court's dismissal of Plaintiffs' unjust enrichment claim because there is no difference between unjust enrichment and a quasi-contract.
The Court agrees with Taco Bell that permitting Plaintiffs to establish a legal relationship based upon a quasi-contract produces an anomalous result where Plaintiffs' unjust enrichment claim has been dismissed. In finding Plaintiffs' unjust enrichment claim preempted, the Court stated that the claim was essentially the same as a copyright claim because "Plaintiffs' primary contention [was] that Taco Bell used the ideas from their materials in advertising its products." Id. at *5. The legal remedy of a quasi-contract, or an implied-in-law contract, is not different in nature or scope from a claim of unjust enrichment. A quasi-contract is an equitable
The Court acknowledges, as it did in its prior opinion, that several cases applying New York law have held that a legal relationship sufficient to avoid preemption may be based upon a quasi contract. See Hogan v. DC Comics, 1997 WL 570871, at *5; Adsani v. Miller, No. 94 Civ. 9131, 1996 WL 194326, at *16-17 (S.D.N.Y. Apr.22, 1996). However, both of those cases relied on a prior case, Vantage Point, Inc. v. Parker Bros., Inc.,
The Court also cited 4 Nimmer on Copyright § 16.01 at 16-4 (1992) and Kienzle v. Capital Cities/American Broadcasting Co.,
For the foregoing reasons, the Court will deny Taco Bell's motion to dismiss/for reconsideration and grant Taco Bell's motion to strike.
An Order consistent with this Opinion will be entered.
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