Balt. Sports & Soc. Club, Inc. v. Sport & Soc., LLC, Civil No. 16–cv–02953–JFM

• Decision Date: 06 January 2017
• Docket Number: Civil No. 16–cv–02953–JFM
• Citation: 228 F.Supp.3d 544
• Court: U.S. District Court — District of Maryland
• Parties: BALTIMORE SPORTS & SOCIAL CLUB, INC. v. SPORT & SOCIAL, LLC & Giovanni Marcantoni

228 F.Supp.3d 544

BALTIMORE SPORTS & SOCIAL CLUB, INC.

v.SPORT & SOCIAL, LLC & Giovanni Marcantoni

Civil No. 16–cv–02953–JFM

United States District Court, D. Maryland.

Signed January 6, 2017

Catherine R. Lawrence, Lawrence Law, Ellicott City, MD, James B. Astrachan, Astrachan Gunst Thomas, PC, Baltimore, MD, for Baltimore Sports & Social Club, Inc.

William Paul Atkins, Pillsbury Winthrop Shaw Pittman LLP, McLean, VA, Clare Cavaliero Pincoski, Pillsbury Winthrop Shaw Pittman LLP, Washington, DC, James Sunderland Aist, Megan Jeannette McGinnis, Anderson Coe and King LLP, Baltimore, MD, for Sport & Social, LLC & Giovanni Marcantoni.

MEMORANDUM

J. Frederick Motz, United States District Judge

Defendant Sport & Social, LLC ("Sport & Social") brings a counterclaim against plaintiff Baltimore Sports & Social Club, Inc. ("BSSC"), seeking a declaratory judgment of non-infringement, and further alleging tortious interference with prospective advantage, defamation, unfair or deceptive trade practices, false advertising, and unfair competition. (ECF No. 14). Now pending is BSSC's motion to dismiss Sport & Social's counterclaim. (ECF No. 23). The motion is fully briefed, and no oral argument is necessary. SeeLocal Rule 105.6. For the reasons set forth below, the motion is granted.

BACKGROUND

At the motion to dismiss stage, this court accepts as true the facts alleged in the complaint. See Aziz v. Alcolac, Inc. , 658 F.3d 388, 390 (4th Cir. 2011). Plaintiff Baltimore Sports & Social Club, Inc. ("BSSC") is a "corporation organized and existing under the laws of the State of Maryland with its principal place of business located at 2900 Normandy Drive, Ellicott City, Maryland, 21043." (ECF No. 31, ¶ 1). Defendant Sport & Social, LLC ("Sport & Social") is a "limited liability company organized and existing under the laws of the State of Delaware, with a principal place of business in Baltimore, Maryland, at 101 W. Dickman St., Suite 300, Baltimore, Maryland, 21230." Id. at ¶ 2. Richard Michael Cray ("Cray") is the owner of plaintiff BSSC (ECF No. 14, ¶ 9), and co-defendant Giovanni Marcantoni ("Marcantoni") operates defendant Sport & Social, (ECF No. 31, at ¶ 3).

Both companies' primary business is the "solicitation and subscription of individuals as members who play sports on teams" the companies organize. (ECF No. 31, ¶ 9; ECF No. 25, p. 1). On August 23, 2016, BSSC filed its original complaint in this court alleging various claims of trademark infringement and unfair competition against Sport & Social and Marcantoni. (ECF No. 1). On September 14, 2016, Sport & Social filed a response and a counterclaim seeking a declaratory judgment of non-infringement (Count I), and further alleging: tortious interference with prospective advantage (Count II); defamation (Count III); unfair or deceptive trade practices (Count IV); false advertising (Count V); and unfair competition (Count VI). (ECF No. 14, ¶ 8).

Specifically, Sport & Social alleges in or about February 2016, Cray and BSSC "began contacting known and prospective customers of Sport & Social with the intention of causing those customers to cease dealing with Sport & Social and to commence dealing with BSSC." Id. at ¶ 10. Further, Sport & Social alleges Cray and BSSC began telling "current and prospective customers of [Sport & Social that it] is an ‘imitation’ social league." Id. at ¶ 11. This pattern continued at the Sport and Social Industry Association ("SSIA") conference, held on February 17, 2016, which both BSSC and Sport & Social attended. Id. at ¶¶ 12–15. Sport & Social alleges that at the SSIA conference, Cray wore a t-shirt at with the phrases: "BSSC, It's the Real Thing," and "DON'T BE FOOLED BY IMITATIONSocials. " Id. at ¶ 16. Sport & Social contends the phrase "IMITATIONSocials " is in the "same font and style" as Sport & Social's logo which contains the phrase "BALTIMORESocial. " Id. at ¶¶ 17–19. Sport & Social also alleges BSSC employees attended an event at Camden Yards on April 4, 2016, for opening day of the Baltimore Orioles' 2016 season. Id. at ¶ 23. At this opening day event, BSSC displayed a banner containing the phrase "DON'T BE FOOLED BY IMITATIONSocials. " Id. Again, Sport & Social contends the phrase "IMITATIONSocials " was the in the "same font and style" as its logo. Sport & Social further contends a picture of this banner was prominently displayed on BSSC's "Facebook" page. Id. at ¶ 25.

Additionally, Sport & Social alleges BSSC interfered with its "business operations, customers, and leagues." Id. at ¶ 26. For example, Sport & Social suggests "[o]n separate occasions throughout the summer of 2016," BSSC "occupied" fields at Patterson Park where Sport & Social had planned sporting events for its customers. Id. at ¶¶ 27–32. Sport & Social claims when its employees approached BSSC employees during these disruptions, the BSSC employees were "hostile and rude" and "refused to leave the fields, causing disruption and delay to Sport & Social's planned events." Id. at ¶ 30. According to Sport & Social, this disruption and delay, which Sport & Social alleges is only one example of such actions, "negatively impacted [it] and its customers." Id. at 31.

On October 3, 2016, BSSC filed a motion to dismiss the following counts for failure to state a claim upon which relief can be granted: tortious interference with prospective advantage (Count II); defamation (Count III); unfair or deceptive trade practices (Count IV); false advertising (Count V); and unfair competition (Count VI). (ECF No. 23).

STANDARD

BSSC has filed a motion to dismiss Counts II–VI in Sport & Social's counterclaim under Rule 12(b)(6). To adequately state a claim under Rule 12(b)(6), a complaint, relying on only well-pled factual allegations, must state at least a "plausible claim for relief." Ashcroft v. Iqbal , 556 U.S. 662, 679, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). The "mere recital of elements of a cause of action, supported only by conclusory statements, is not sufficient to survive a motion made pursuant to Rule 12(b)(6)." Walters v. McMahen , 684 F.3d 435, 439 (4th Cir. 2012). In order to determine whether Sport & Social's counterclaim has crossed "the line from conceivable to plausible," the court must employ a "context-specific inquiry," drawing on the court's "experience and common sense." Iqbal , 556 U.S. at 680, 129 S.Ct. 1937. When performing this inquiry, the court accepts "all well-pled facts as true and construes these facts in the light most favorable to the plaintiff in weighing the legal sufficiency of the complaint." Nemet Chevrolet, Ltd. v. Consumeraffairs.com, Inc. , 591 F.3d 250, 255 (4th Cir. 2009). The court need not, however, accept unsupported legal allegations, Revene v. Charles Cnty. Comm'rs, 882 F.2d 870, 873 (4th Cir. 1989), nor must it agree with legal conclusions couched as factual allegations, Iqbal, 556 U.S. at 678, 129 S.Ct. 1937, or conclusory factual allegations devoid of any reference to actual events, United Black Firefighters v. Hirst, 604 F.2d 844, 847 (4th Cir. 1979) ; see also Francis v. Giacomelli, 588 F.3d 186, 193 (4th Cir. 2009).

ANALYSIS

BSSC moves to dismiss Counts II–VI in Sport & Social's counterclaim for failure to state a claim upon which relief can be granted. I assess BSSC's arguments in this order: defamation (Count III); tortious interference with prospective advantage (Count II); unfair or deceptive trade practices (Count IV); false advertising (Count V); and unfair competition (Count VI).

I. Count III: Defamation

Sport & Social alleges BSSC made false and defamatory statements when it used t-shirts, banners, and statements, suggesting Sport & Social is an "imitation" social league. (ECF No. 14, ¶¶ 48–54). Under Maryland law, "a defamatory statement is one which tends to expose a person to public scorn, hatred, contempt or ridicule, thereby discouraging others in the community from having a good opinion of, or from associating or dealing with, that person." Gomer v. Home Depot U.S.A., Inc. , No. CV GLR-16-356, 2016 WL 5791226, at *6 (D. Md. Oct. 4, 2016) (citing Batson v. Shiflett , 325 Md. 684, 602 A.2d 1191, 1210 (1992) (citation omitted)). To sustain a defamation claim, Sport & Social must demonstrate four elements: "(1) the defendant made a defamatory communication to a third person; (2) that the statement was false; (3) that the defendant was at fault in communicating the statement; and (4) that the plaintiff suffered harm." Id. (citing Ziemkiewicz v. R+L Carriers, Inc. , 996 F.Supp.2d 378, 393 (D. Md. 2014) (quoting Samuels v. Tschechtelin , 135 Md.App. 483, 763 A.2d 209, 241–42 (2000) )).

Even if Sport & Social can demonstrate these four elements, however, the "application of the state law of defamation" is limited, as the Supreme Court and Fourth Circuit have expounded, by the First Amendment to the Constitution of the United States. CACI Premier Tech., Inc. v. Rhodes , 536 F.3d 280, 293 (4th Cir. 2008) (citing Milkovich v. Lorain Journal Co., 497 U.S. 1, 14, 110 S.Ct. 2695, 111 L.Ed.2d 1 (1990) ). Specifically, "statements that cannot reasonably be interpreted as stating actual facts" are protected. Id. (citing Milkovich , 497 U.S. at 20, 110 S.Ct. 2695 ). To be considered as a "statement[ ] that cannot reasonably be interpreted as stating actual facts," the statement must either involve: (1) "matters of public concern, or (2) "rhetorical statements employing ‘loose, figurative, or hyperbolic language.’ " Snyder v. Phelps , 580 F.3d 206, 220 (4th Cir. 2009), aff'd, 562 U.S. 443, 131 S.Ct. 1207, 179 L.Ed.2d 172 (2011) (citing Milkovich , 497 U.S. at 20–21, 110 S.Ct. 2695 ). The reason these "rhetorical statements" are accorded protection is because "[t]he general tenor of rhetorical speech, as well as the use of ‘loose, figurative, or hyperbolic language’ sufficiently negates any impression that the speaker is asserting actual facts." Id. (citing Milkovich , 497 U.S. at 21, 110 S.Ct. 2695 ); see also Letter Carriers v. Austin, 418 U.S. 264,...