Logan Farms v. Hbh, Inc. De

• Decision Date: 29 August 2003
• Docket Number: No. C-1-01-437.,C-1-01-437.
• Citation: 282 F.Supp.2d 776
• Parties: LOGAN FARMS, et al., Plaintiffs, v. HBH, INC. DE, et al., Defendants.
• Court: U.S. District Court — Southern District of Ohio

282 F.Supp.2d 776

LOGAN FARMS, et al., Plaintiffs, v. HBH, INC. DE, et al., Defendants.

No. C-1-01-437.

United States District Court, S.D. Ohio, Western Division.

August 29, 2003.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

C. Vernon Lawson, Guy E. Matthews, Rodney K. Castille, The Matthews Firm, Houston, TX, Joseph J. Braun, Thomas L. Stachler, Strauss & Troy, William Robert Jacobs, Cincinnati, OH, for Plaintiffs.

Marcia Voorhis Andrew, W. Stuart Dornette, Taft, Stettinius & Hollister, Cincinnati, OH, Grace M. Mora, Jeffrey R. Gans, Mark Fox Evens, Thelen, Reid & Priest LLP, Washington, DC, for Defendants.

ORDER

BECKWITH, District Judge.

"The travails of this case would fill a blue book in a final law exam."

Logan v. The Original HoneyBaked Ham Co. of Georgia, Inc., 60 Fed.Appx. 816 (Fed.Cir.2003).

The Federal Circuit knew whereof it spoke. This case comes before the Court on a veritable plethora of pending motions and with a procedural history as complex as any case in recent memory. There are currently pending fifty-two separate motions: eight motions to dismiss for lack of personal jurisdiction (Doc. Nos. 10-1, 11-1, 13-1, 15-1, 16-1, 30-1, 31-1, and 32-1), nineteen motions for summary judgment (Doc. Nos. 10-2, 11-2, 12-2, 13-2, 14-2, 15-2, 16-2, 17-2, 22-2, 23-2, 24-2, 25-2, 26-2, 27-2, 28-2, 29-2, 30-2, 31-2, and 32-2), eleven motions to dismiss for failure to state a claim (Doc. Nos. 12-1, 14-1, 17-1, 22-1, 23-1, 24-1, 25-1, 26-1, 27-1, 28-1, and 29-1), eleven motions to transfer this case to various other judicial districts (Doc. Nos. 10-3, 11-3, 12-3, 13-3, 14-3, 15-3, 16-3, 17-3, 30-3, 31-3, and 32-3), one motion to stay ruling on these motions until discovery is completed (Doc. No. 68), one motion to file supplemental authority (Doc. No. 90), and one motion to file new authority (Doc. No. 94). The Federal Circuit managed to resolve the issues before it without having to elaborate on this case's background. This Court, however, is not so fortunate in as much as a somewhat detailed explanation of this controversy's history is required in order to resolve the litany of pleadings before it. While the Court is not equipped with blue books, we do have on hand an ample supply of ordinary stationary with which to describe the course of this litigation.

I. Background

The Plaintiffs in this case are James P. Logan ("Logan") and Logan Farms, Inc ("Logan Farms"). Logan is a citizen of the state of Texas. Complaint ¶ 2. Logan Farms is a Texas corporation with its principal place of business located in Harris County, Texas. Id. ¶ 1.¹ The Defendants in this case are Honeybaked Hams, Inc. ("HBH"), a Delaware corporation with its principal place of business located in Mason, Ohio, and the following licensees of HBH: HBH ML Anderson, Co. ("ML Anderson"), a Texas corporation with its principal place of business in Texas, Honey Baked Ham Co. of Philadelphia, Inc. ("Philadelphia"), a Pennsylvania corporation, HoneyBaked Ham Company PA ("Pennsylvania"), also a Pennsylvania corporation, Honey Baked Ham, Inc. IN ("Indiana"), an Indiana corporation, The Original Honey Baked Ham Company ("Texas"), a Texas corporation, The HoneyBaked Ham Company WI ("Wisconsin"), a Wisconsin corporation, HBH Anderson Co. ("HBH Anderson"), an Indiana corporation, Honey Baked Hams AZ ("Arizona"), an Arizona corporation, Honey Baked Hams OH ("Ohio"), an Ohio corporation, Honey Baked Hams KY ("Kentucky"), a Kentucky corporation, Honey Baked Hams MO ("Missouri"), a Missouri corporation, Honey Baked Hams VA ("Virginia"), a Virginia corporation, Honey Baked Hams MN ("Minnesota"), a Minnesota corporation, Honey Baked Hams KS ("Kansas"), a Kansas corporation, Honey Baked Hams DE ("Delaware"), a Delaware corporation, Graycase Investments, Inc. ("Graycase"), an Oregon corporation, Honeybaked Ham Company WA ("Washington"), a Washington corporation, and The Original Honey Baked Ham Company of Illinois, Inc. ("Illinois"), an Illinois corporation.

The roots of the present case stretch back to 1997 and have their evolution in patents that Logan holds for a method of spirally slicing boneless meat products, such as, unsurprisingly given the parties involved, ham. See Complaint, Exs. A, B & C. In July 1997, Logan filed suit for patent infringement against The Original Honey Baked Ham Company of Georgia, Inc. ("Georgia") and HoneyBaked Foods, Inc. ("Foods"), alleging that these defendants were using his patented slicing process. Logan filed this lawsuit in the U.S. District Court for the Western District of Louisiana. Logan, however, dismissed his patent infringement suit against Georgia and Foods after entering into a license agreement with not only these two companies, but also with all of Defendants in this case.²

Logan perhaps understandably believed that his new license agreement would begin to generate a substantial stream of royalty payments for him. Logan claims, however, that the HoneyBaked Ham representatives had their own devious plans in mind. Logan claims that while negotiations for the license agreement were ongoing, the HoneyBaked Ham licensees were, unbeknownst to him, making plans to discontinue selling all meat products sliced according to Logan's patents so that they would not have to pay him any royalties. Indeed, Defendants appear to admit that this claim is true, but do not see any problem because they say that the license agreement does not require them to sell any products using the patented spiral slicing method. In other words, Defendants appear to admit that while they would have to pay Logan royalties for all meat products sliced by Logan's patented process, they contend that nothing in the license agreement compels them to actually use Logan's process. Thus, according to Logan, he was duped into dropping his patent infringement claims for an essentially worthless license agreement.

When Logan figured out what was going on, he resumed litigation of his patent infringement claims against Georgia and Foods, and added state law claims for breach of contract, fraudulent inducement (also known as vice of consent in Louisiana), and a claim for false advertising under the Lanham Act, 15 U.S.C. § 1125(a). Logan's breach of contract claim was based on Georgia and Foods' alleged failure to sell any spiral sliced meat products. The fraudulent inducement claim alleged that Georgia and Foods failed to disclose to Logan that they had no intention of selling any spiral sliced meats at the time the license agreement was consummated. The Lanham Act count claimed that Georgia and Foods falsely advertised that their meat products were spiral sliced when in fact they were center sliced.

The district court in Louisiana bifurcated Logan's patent claims from the other claims and tried the non-patent claims to a jury first. The jury answered special verdict forms which found that: 1) there was no valid license agreement between Logan and Georgia and Foods; 2) anticipation of a stream of royalties was Logan's principal purpose for entering into the license agreement; 3) Georgia and Foods knew that Logan's principal purpose for entering the license agreement was the anticipated royalty stream; 4) Georgia and Foods fraudulently induced Logan into consenting to the license agreement; 5) Logan stated a claim for false advertising under the Lanham Act; 6) Logan failed to establish any losses as a result of Georgia and Foods' breach of the license agreement; and 7) Georgia and Foods willfully violated the Lanham Act. See Doc. No. 65, Exs. F & G. The jury awarded Logan damages from Foods in the amount of $809,540 on the fraudulent inducement claim and $80,000 on the Lanham Act claim. The jury award Logan damages from Georgia in the amount of $7,934,218 on the fraudulent inducement claim and $400,000 on the Lanham Act claim. Id. After the jury returned its verdicts, Logan moved to dismiss his patent infringement claims if defendants dismissed their declaratory judgment counterclaims.³

The district court then entered judgment against Georgia and Foods in the stated amounts plus postjudgment interest. The district court's judgment also rescinded the license agreement as between Georgia and Foods and awarded Logan attorney's fees on the fraud claim. The judgment denied Logan's claims for prejudgment interest and attorney's fees under the Lanham Act. See id. Ex. I.

Georgia and Foods, however, filed post-judgment motions for remittitur or, in the alternative, for amendment of judgment. According to the district court, Defendants argued that there was no evidence upon which to find that Logan was fraudulently induced to consent to the license agreement, that damages for vice of consent are not appropriate, that the jury's verdict on the Lanham Act claim was against the weight of the evidence, and that damages under the Lanham Act were inappropriate because Logan failed to prove any injury. The district court largely agreed with defendants' arguments. The district court rejected defendants' argument that the jury's verdict on Logan's fraudulent inducement claim was against the weight of the evidence, but found that Plaintiff had sought rescission, not damages, in his vice of consent claim. The district court also found that Logan was not entitled to damages on his Lanham Act claim because there was no evidence that consumers bought meat products because of the slicing or even cared how it was sliced. See id. Ex. J. Thus, the district court vacated and set aside all monetary awards for Logan.

Both sides appealed from this judgment, but the Fifth Circuit Court of Appeals affirmed the district court's judgment in all respects. See Logan v. Burgers Ozark Country Cured Hams, Inc., 263 F.3d 447 (5th Cir.2001). Logan also appealed to the Federal Circuit Court of Appeals the district court's decision to amend its dismissal of the patent infringement claims to a dismissal with prejudice. The Federal Circuit, however,...