Gallup, Inc. v. Talentpoint, Inc., CIVIL ACTION NO. 00-5523 (E.D. Pa. 11/13/2001)
| Decision Date | 13 November 2001 |
| Docket Number | CIVIL ACTION NO. 00-5523. |
| Parties | GALLUP, INC. d/b/a THE GALLUP ORGANIZATION Plaintiff, v. TALENTPOINT, INC. Defendant. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
Plaintiff the Gallup Organization ("Gallup") alleges that defendant Talentpoint, Inc., now operating under the name of Kenexa Corporation ("Kenexa"),1 misappropriated valuable intellectual property belonging to Gallup. Plaintiff brings forth six federal and state claims.2 Presently before this Court are the motion of plaintiff Gallup for partial summary judgment on its copyright claim (count V) (Document No. 17), the cross motion of defendant Kenexa for partial summary judgment on the copyright claim (Document No. 20), both of which have been filed pursuant to Federal Rule of Civil Procedure 56, and the motion of Kenexa for partial summary judgment on counts I, II and III, pursuant to Rule 56, and for judgment on the pleadings on counts IV and VI, pursuant to Rule 12(c), or in the alternative for summary judgment pursuant to Rule 56 (Document No. 19). Each motion, and the papers in support of and opposition, have been filed under seal in accordance with the confidentiality agreement entered into by the parties.
Upon consideration of the motions, responses and replies thereto, I will deny the motion of plaintiff for summary judgement on the copyright claim, will deny the motion of defendant for summary judgement on the copyright claim, will deny in part and grant in part the motion of defendant for summary judgment on counts I, II and III, and will deny the motion of defendant for judgment on the pleadings, or in the alternative for summary judgment, on counts IV and VI.
I. Background
At the heart of this case is Gallup's employee engagement survey instrument, known as the "Gallup Q12" or "Q12". This survey seeks the employee's reaction to twelve specific issues relating to an employee's perception of his or her workplace, plus an overall employee satisfaction question. The Q12 is designed to measure employee engagement in the workplace. On October 19, 1999, Gallup received a copyright certificate for the survey. According to the certificate, the survey was created in 1992. The Q12 is also the subject of First, Break All the Rules: What the World's Greatest Managers Do Differently, ("First, Break All the Rules" or "Rules"), a book written in 1999 by two Gallup employees, Curt Coffman and Marcus Buckingham. Gallup alleges that Kenexa has copied the Q12 and is using ten of the twelve survey items, as well as the overall satisfaction question, in virtually identical form in its employee engagement survey business.
The survey exists of the following:
On a five point scale, where "5"is extremely satisfied, and "1" is extremely dissatisfied, how satisfied are you with ___ as a place to work?
On a scale of 1 to 5, where 5 is strongly agree, and 1 is strongly disagree, please indicate your level of agreement with each of the following items.
1. I know what is expected of me at work.
2. I have the materials and equipment I need to do my work right.
3. At work, I have the opportunity to do what I do best everyday.
4. In the last seven days, I have received recognition or praise for doing good work.
5. My supervisor, or someone at work, seems to care about me as a person.
6. There is someone at work who encourages my development.
7. At work, my opinions seem to count.
8. The mission/purpose of my company makes me feel my job is important.
9. My associates (fellow employees) are committed to doing quality work.
10. I have a best friend at work.
11. In the last six months, someone at work has talked to me about my progress.
12. This last year, I have had opportunities at work to learn and grow.
(Pl.'s Mem. in Further Support, Ex. O, Aff. of Donald O. Clifton at 3.)
The two parties are competitors in the field of employees surveys. Gallup is a management consulting firm. In addition to conducting "The Gallup Poll," it provides consultation to improve company performance by leveraging employee and customer assets. Gallup was established in 1935. In 1988, Gallup was acquired by Selection Research Inc. ("SRI"), but the Gallup name was retained. Kenexa provides integrated human capital management and technology solutions. In 1997, Kenexa acquired Human Resource Innovations ("HRI"), which was founded in 1994 by Bill Erickson ("Erickson"), who worked for Gallup for 15 years, and Troy Kanter ("Kanter"), who was employed by Gallup for four years.
Gallup explains the following with respect to the Gallup Q12. In developing the survey, Gallup researchers conducted thousands of focus groups across many varied industries over a period of approximately twenty-five years. (Aff. of James K. Harter ¶ 7, Pl.'s Ex. E.) Based on these focus groups and accumulated knowledge, Gallup developed extensive surveys and studied the results thereof in order to find common factors within the data. (Id. ¶ 9.) After identifying preferred items in this process, Gallup conducted confirmatory analyses. (Id. ¶ 11.) One such analyses is known as the "meta-analysis." (Id.) Gallup's 1997 meta-analysis encompasses 1,135 business units and 41,490 individual employee responses. (Id. ¶ 15.) The 1998 meta-analysis encompasses over 2,500 business units and more than 100,000 individual employee responses. (Id. ¶ 16.) Gallup further contends since Kenexa's 1997 acquisition of HRI, Kenexa has begun to conduct employee engagement surveys and has "raided" Gallup in order to hire former Gallup employees who have detailed knowledge of the Gallup Q12.
Kenexa counters with the following. Since starting HRI, Erickson has written hundreds of items used in surveys. (Dep. of Erickson at 152, Def.'s Ex. B.) Survey questions were developed through experimentation, client suggestions, a determination of what has been helpful and works, what has created a behavioral change in an organization, as well as linkage research. (Id.) Over time, a group of questions, or "core" survey items has emerged. (Id, at 150-53.) The overall employee survey methodology, and the selection of the individual items were fully developed in mid-1996. (Dec. of Erickson ¶ 2.) These core items have varied from 25-33 and at present consist of 28 items. (Dep. of Erickson at 150-53.)
B. Analysis
1. Legal Standards
In deciding a motion for summary judgment under Rule 56 of the Federal Rules of Civil Procedure, the "test is whether there is a genuine issue of material fact and, if not, whether the moving party is entitled to judgment as a matter of law." Medical Protective Co. v. Watkins, 198 F.3d 100, 103 (3d Cir. 1999). Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). Furthermore, "summary judgment will not lie if the dispute about a material fact is `genuine,' that is, if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. at 250.
The facts should be reviewed in the light most favorable to the non-moving party. See Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (quoting United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 8 L.Ed. 176 (1962)). The nonmoving party "must do more than simply show that there is some metaphysical doubt as to the material facts," Matsushita, 475 U.S. at 586, and must produce more than a "mere scintilla" of evidence to demonstrate a genuine issue of material fact and avoid summary judgment. See Big Apple BMW, Inc. v. BMW of North America, Inc., 974 F.2d 1358, 1363 (3d Cir. 1992).
Under Rule 56(f), where the nonmoving party believes that more time is needed for discovery, such party is directed to file an affidavit setting forth why the time is needed. See Pastore v. Bell Tel. Co. of Pa., 24 F.3d 508, 510-11 (3d Cir. 1994). The Court of Appeals has observed that failure to file the affidavit "is usually fatal." See id. at 511. Indeed, the Court appears on occasion to have determined that failure to file the affidavit equates to a failure to preserve an objection. See Falcone v. Columbia Pictures Indus., Inc., 805 F.2d 115, 117 n. 2 (3d Cir. 1986). Such an omission, while demonstrating poor lawyering, has also been held not ruinous if the motion "identif[ies] with specificity what particular information is sought; how, if uncovered, it would preclude summary judgment; and why it has not previously been obtained." St. Surin v. Virgin Islands Daily News, Inc., 21 F.3d 1309, 1314 (3d Cir. 1994).
When opposing parties file cross-motions for summary judgment, the court must consider each motion separately, and "each side must still establish a lack of genuine issues of material fact and that it is entitled to judgment as a matter of law." U.S. ex rel. Showell v. Philadelphia AFL-CIO Hosp. Ass'n, Civ. No. 98-1916, 2000 WL 424274, at *1 (E.D.Pa. Apr. 18, 2000), aff'd, — F.3d — (3d Cir. Aug. 10, 2001) (quoting Nolen v. Paul Revere Life Ins. Co., 32 F. Supp.2d 211, 213 (E.D.Pa. 1998)).
Under Rule 12(c), "After the pleadings are closed but within such time as not to delay trial, any party may move for judgment on the pleadings." While a 12(b)(6) motion to dismiss, is filed before any responsive pleading, under Rule 12(h)(2), "[a] defense of failure to state a claim upon which relief may be granted . . . may be made . . . by a motion for judgment on the pleadings." In this situation, the court is directed to apply the same standards employed under 12(b)(6). See Turbe v. Gov't of the Virgin Islands, 938 F.2d 427, 428 (3d Cir. 1991) (collecting cases); Katzenmoyer v. City of Reading, 158 F. Supp.2d 491, 496 (E.D.Pa. 2001); 5A Charles Alan Wright &...
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