Bischoff v. Waldorf

• Decision Date: 25 September 2009
• Docket Number: Civil No. 09-10549.
• Citation: 660 F.Supp.2d 815
• Parties: Michael BISCHOFF and Passport Pizza, Plaintiffs, v. Ken WALDORF, Christopher Swanson, Pizza Palazzo, Tracy Doe, Walson, Inc., John Does 1-10, and Jane Does 1-10, Defendants.
• Court: U.S. District Court — Eastern District of Michigan

660 F.Supp.2d 815

Michael BISCHOFF and Passport Pizza, Plaintiffs, v. Ken WALDORF, Christopher Swanson, Pizza Palazzo, Tracy Doe, Walson, Inc., John Does 1-10, and Jane Does 1-10, Defendants.

Civil No. 09-10549.

United States District Court, E.D. Michigan, Southern Division.

September 25, 2009.

Michael Bischoff, Sterling Heights, MI, pro se.

Passport Pizza, pro se.

David M. Belanger, Law Offices of David M. Belanger P.C., Richard J. Carolan, Carolan & Carolan, St. Clair Shores, MI, for Defendants.

OPINION AND ORDER GRANTING DEFENDANTS' MOTION TO DISMISS

JOHN FEIKENS, District Judge.

This case involves a very simple resolution of overly complicated pleadings. Although a one-sentence order could dismiss this case for lack of standing, I have included more detail to emphasize the importance of the rule at issue: a corporation's claims, even when purportedly "assigned" to an individual, must be litigated by a licensed attorney. This policy protects the courts and other litigants from incomprehensible and burdensome cases like the present one.

THE COMPLAINT

On February 13, 2009, Michael Bischoff commenced this action pro se by filing a complaint on behalf of himself "&/or Passport Pizza."¹ In the Complaint, Mr. Bischoff purports to be the owner and creator of Passport Pizza. Passport Pizza has been registered as an assumed name of both Passport Group LTD and Passport Enterprises, Inc.² Mr. Bischoff is not listed on the incorporation papers for either entity. In fact, it is unclear from the record whether Mr. Bischoff has any relationship with either company, or their d/b/a, Passport Pizza. Adding to the web of complexity, a third entity, Passport U.S.A., Inc., appears to be the owner of a trade or service mark central to Mr. Bischoff's allegations. Mr. Bischoff is the registered agent of Passport U.S.A., Inc. This entity, however, first filed articles of incorporation on March 17, 2008—seven months after the franchise agreement he now attempts to enforce. There is no indication of any legal relationship between Passport Pizza and Passport U.S.A., Inc.

The Complaint seeks several extraordinary remedies, including $10,000,000 in damages and an order compelling the U.S. Attorney to investigate the alleged criminal actions. It names thirteen individual defendants (Ken Waldorf, Christopher Swanson, Tracy (Doe), and 10 John or Jane Does) and two corporate defendants (Pizza Palazzo and Walson, Inc.). The Complaint alleges that some (unidentified) defendant signed a contract to become a franchisee of Passport Pizza for a one-year period beginning in August, 2007. All defendants deny this allegation. The alleged franchise agreement is not attached to any pleading or otherwise entered into the record.

I will attempt to extract from the ill-drafted Complaint the allegations comprising Mr. Bischoff's claims, all of which allegedly occurred after the franchise agreement expired:

(a) Defendants failed to return a Passport Pizza Operations Manual, which Mr. Bischoff claims cost him over $1,000,000 to develop;

(b) Defendants continued to use the Passport Pizza menu, or at least used "identical" (allegedly trademarked) product names and pricing structure, thus permitting customers to order at the new business using the franchise's menu;

(c) Defendants continued to use the same phone number, which Mr. Bischoff alleges he owns;

(d) Defendants now own/operate a business known as Pizza Palazzo; Mr. Bischoff alleges that he registered and owns the internet domain name "pizzapalazzo.com."³ Thus, he claims the Defendants are "violating" his domain name and engaging in "copyright violations."

(e) Defendants told "investigators" who placed calls to order pizza that they used to be Passport Pizza, but dropped the franchise because of "shady stuff."

The Complaint alleges four "causes of action," each comprised of an awkward sub-grouping of around a dozen civil claims. The claims include: violations of the "Lantham [sic] Trademark Act", Uniform Trade Secrets Act, Economic Espionage Act, "state & [sic] common law" copyright and trademark violations "same as if rewritten herein", conversion, fraud and fraud in the inducement, breach of contract, libel and slander, and "violation" of plaintiff's registered internet domain name under "trademark, copyright & state law." Even if Mr. Bischoff or a properly-named corporation had standing, a cursory review demonstrates that many of the claims fail on their face:⁴

• The Complaint identifies no trade secrets with the particularity required to plead a cause of action under the Uniform Trade Secrets Act.

• Although the Economic Espionage Act criminalizes the theft or misappropriation of a trade secret, it does not create a private cause of action.

• Mr. Bischoff does not allege or present evidence of any registered copyrights. Therefore, he cannot sue for copyright infringement under the 1976 Copyright Act.

• Nor is it likely that Mr. Bischoff can state a claim for "state" or "common law" copyright, as such claims have been largely preempted by Section 301 of the 1976 Copyright Act. Moreover, the Complaint has not identified a single copyrighted work or alleged an infringing act (i.e. unauthorized reproduction, distribution, performance, or public display of a protected work or creation of a derivative work).

• The fraud and fraud in the inducement claims must be pled with particularity. There are insufficient facts alleged to support either claim.

• Mr. Bischoff apparently did not register the internet domain name he now tries to sue upon until after the defendants began using it. There is no indication that Mr. Bischoff has any claim to the name Pizza Palazzo, other than his rather obvious attempt to retaliate against the defendants for refusing to renew the alleged franchise agreement and harm their ongoing business operations.

• The only fact in support of the "libel and slander" claim is that someone answering the phone at Pizza Palazzo indicated that the business had dropped the Passport Pizza franchise because of some "shady stuff." As there has been no allegation of a written defamatory publication, the libel claim fails. The slander claim also fails because there are insufficient facts alleged to support a claim of defamation per se, and there are no allegations of the existence of special harm caused by the publication (defamation per quod).

The Complaint also purports to bring criminal claims for: violations of "criminal Trademark statutes" and "Federal Criminal Laws [for] `Infringement of Copyright or Trademark' as set forth in [17] U.S.C. § 506(a); 18 U.S.C. §§ 2318-2320, 2511 for `commercial gain'." Ignoring for a moment that an individual may not bring criminal charges, these allegations further demonstrate Mr. Bischoff's poor understanding of the law and inability to clearly articulate a cause of action. Again, the slightest scrutiny disposes of all of Mr. Bischoff's criminal allegations:

• Because he has claimed no registered copyright, 17 U.S.C. § 506(a) and 18 U.S.C. § 2319 (criminal copyright infringement) do not apply.

• Mr. Bischoff has not (and seemingly cannot) allege facts to support a cause of action under 18 U.S.C. § 2318 (trafficking in counterfeit labels or packaging); 18 U.S.C. § 2319A (unauthorized fixation of and trafficking in sound recordings and music videos of live musical performances); 18 U.S.C. § 2319B (unauthorized recording of motion pictures in a motion picture exhibition facility); 18 U.S.C. § 2320 (trafficking in counterfeit goods or services); or 18 U.S.C. § 2511 (interception and disclosure of wire, oral, or electronic communications prohibited).

Of the remaining civil claims, perhaps some entity has a claim for breach of contract (although the contract has not been provided, defendants deny having entered into such a contract, and the "breach" itself has never been described). In addition, it appears that a trademark claim may have merit, though it would likely be based on common-law trademark.

It is precisely this type of inarticulate, awkward, and meritless litigation that courts seek to avoid through the rule requiring that corporations be represented by counsel. Neither courts, nor defendants, should waste time and resources on such proceedings.

PROCEDURAL HISTORY

On March 10, 2009, defendants moved to dismiss the Complaint on the grounds that the plaintiffs lacked standing, and that Passport Pizza is not represented by an attorney.⁵ On April 6, 2009, Mr. Bischoff filed a brief in opposition to the motion, essentially reiterating the allegations in his Complaint.⁶ At the April 15, 2009, motion hearing before Magistrate Judge Morgan, Mr. Bischoff first alleged that Passport Pizza had assigned its interests in this case to him. Thereafter, he filed an "Assignment Instanter" indicating that "Passport USA Inc (DBA Passport Pizza)", as the owner of the trademarks, copyrights and all claims involved in this case, assigned those claims to Michael Bischoff for "valuable consideration."⁷

On July 22, 2009, Magistrate Judge Morgan issued a Report and Recommendation recommending that Mr. Bischoff be granted leave until September 1, 2009, to permit an attorney to enter an appearance and file an amended complaint on behalf of a properly named party. She further recommended that if no attorney appearance or amended complaint is filed by that date, the case should be dismissed.⁸

On August 4, 2009, Mr. Bischoff, still acting pro se, filed objections to the Report and Recommendation. While it is not entirely clear, it appears he objected only to the conclusion that he has no standing. He reasoned that since "all allegations of the [plaintiff] must be accepted as true," and he claimed to have standing, the court must find that he has the requisite standing. The "allegations" he expects the court to rely upon include: (1) that there has been "a legitimate assignment" before the filing of the lawsuit, granting him "clear title to the trademarks,...