UNITED STATES DISTRICT COURT
MEMORANDUM IN SUPPORT OF DEFENDANT KREMER'S
Table of Authorities
C. Bosley's Libel Counts Should Be Dismissed Under California Law as a Strategic Lawsuit Against Public Participation.
A large California company, which specializes in luring men and women into painful and expensive cosmetic surgery to avoid the appearance of baldness, has sued a California consumer to suppress criticism of its sales and medical practices which the consumer has posted on a passive and non-commercial Internet web site. The site republishes several damning findings from a California law-enforcement investigation, which were later accepted by the company in a settlement, embodied in a consent order in Maryland, and confirmed by an NBC News investigation. Nevertheless, the company has sued in this Court, claiming personal jurisdiction here and attempting to avoid application of a California anti-SLAPP statute. The company invokes federal jurisdiction based on trademark claims that seek to ban the use of the name "Bosley" on Kremer's web site, even though it has lost in arbitration on its central claim. The arbitrator labeled that claim "cyber-bullying," an effort to hide behind trademark claims as a basis "to squelch Respondent's criticism of Complainants."
However, as this memorandum explains, settled law regarding suits over web sites requires the denial of jurisdiction and venue in Illinois, and the non-commercial nature of the web site requires dismissal of the federal trademark claims. The state libel claims should also be rejected because, with the dismissal of the federal trademark claims, there remains no basis for pendent jurisdiction over the state law claims. Moreover, the filing of the suit in Illinois does not avoid the application of California law to the libel claims, including California's anti-SLAPP statute, which applies to state law claims filed in federal court. Accordingly, the complaint should be dismissed, and defendant should be awarded his attorney fees.
The plaintiffs in this case are a large national company that performs surgery of the hair and scalp, and its Illinois affiliate. Bosley Medical Institute, Inc. ("Bosley") is a Delaware corporation whose principal place of business is located in Beverly Hills, California. Complaint ¶ 11. According to its complaint, Bosley is national medical and marketing organization that attracts patients throughout the nation and the world as a result of an extensive marketing campaign through television, print media, and internet advertising. Complaint ¶¶ 11-13, 20, 34. In a complaint in arbitration that it previously brought against defendant Kremer, Bosley elaborated that it spends some $12,000,000 each year on advertising, producing annual revenues of $40,000,000 from patients. Kremer Affidavit, Exhibit E. Pages gleaned from the Bosley web site and elsewhere reveal that Bosley's founder, Larry Lee Bosley ("Dr. Bosley"), appears regularly on cable television to promote his company, Kremer Affidavit, Exhibit C; that Larry Bosley frequently publishes articles about hair transplantation in an effort to call attention to his supposed expertise and to his company's services, id.; and that Bosley has placed numerous internet advertisements offering "free" information as a come-on to obtain more patients, id. Exhibit B, and buys paid listings on various Internet search engines. Id. ¶ 22. As a result of this extensive marketing campaign, see generally id. ¶¶ 5-6. Bosley has built a network of 38 sales and medical offices in 21 different states as well as Washington, D.C. and Vancouver, B.C. Id., Exhibit A.
Despite its marketing efforts or, perhaps, because of them Bosley has also attracted a fair amount of unfavorable attention. On several occasions, its practices have been condemned by state medical boards and other law enforcement agencies, and Larry Bosley's medical practice has been placed on probation. In the mid-1990's, Bosley was the subject of an extensive investigation by the California Medical Board and the Los Angeles District Attorney who, after interviewing many of Bosley's patients and former employees, produced a stinging indictment of Bosley's marketing and medical practices. The condemned conduct included doctoring photographs to show favorable results, concealing the unpleasant aspects of hair transplantation from prospective patients (such as the painful nature of the treatments and the tendency to require more expensive treatments after the first treatments are completed), recommending initial levels of treatments based on each patient's perceived ability to pay (and then adding on further services when, predictably, the initial treatments proved unsatisfactory), paying commissions based on employees' success in luring patients using these abusive devices, using non-medical personnel to perform medical procedures, and numerous other abuses. See Kremer Affidavit, Exhibit F. In response to this damning report, Bosley was compelled to pay a six-figure fine and the DA's legal expenses. Id. ¶ 8. More recently, many of the California findings were adopted verbatim by the Maryland Board of Medical Discipline, and accepted in turn by Bosley in a consent decree signed last year, which suspended Bosley's practice and placed it on probation for five years. Id., Exhibit H. In fact, a review of web sites maintain by the Federation of State Medical Boards reveals that Bosley has been disciplined by nearly half of the fifty states. Kremer Affidavit ¶ 9 and Exhibit G. Bosley also lost a class action lawsuit brought by several disgruntled patients. Id. ¶ 29.
Several major media outlets have reported unfavorably on Bosley's activities. The NBC program Dateline broadcast the results of its own investigation in 1997, id., Exhibit J, and U.S. News and World published an article on baldness treatments that featured Bosley's misconduct as a major reason for concern. Id., Exhibit K. These reports included undercover investigations that found Bosley recommending unnecessary treatments. Several other articles unfavorable to Bosley have appeared elsewhere. E.g., id., Exhibit L. Bosley's activities have been the subject of extensive unfavorable discussion by former patients on internet discussion groups. Id. ¶ 13. Bosley has never challenged the factual accuracy of these reports. Id. ¶¶ 9, 11, 13.
Defendant Michael Steven Kremer is a California resident and dissatisfied former patient of Bosley's. Kremer filed a suit in 1994 to recover damages from Bosley, but his complaint was dismissed due to his inability to find a physician willing to testify against Bosley. In 1999, Kremer learned of the disciplinary action taken against Bosley as a result of the state Attorney General's consumer protection lawsuit, People of California v. Bosley Medical Group, Bosley Medical Institute, and Larry Lee Bosley, M.D. He discovered that Bosley had been sanctioned for using several of the same unlawful business practices that Kremer had alleged in his suit against Bosley. Kremer decided to create an Internet site to call the public's attention to Bosley's style of medical practice, recognizing that consumers could then weigh his warnings against Bosley's self-promotional information, and hence make an informed choice. Kremer Affidavit ¶ 14.
Kremer has never lived in Illinois; he has never worked in Illinois; he has not even set foot in Illinois for many years; he owns no property in Illinois; and his employment and business activities have nothing to do with Illinois. Id. ¶¶ 2-3. His only connection to Illinois the basis on which this suit has been filed here is that his web site can be viewed by Illinois residents, as they can by residents of other states and other countries, and by other persons who might then choose not to use the services of Bosley's Illinois office, one of the thirty-eight offices that it maintains throughout the United States. Complaint ¶¶ 33-34.
To create this site, Kremer first registered a "domain name," the Internet address at which he was going to publish his criticisms of Bosley. The first domain name that he chose, on January 7, 2000, was "bosleymedical.com," which aptly summarized the target of his criticisms. Kremer then notified Bosley of his plans for an Internet site, giving Bosley the opportunity to raise any objections that it might have. After Bosley's unsuccessful arbitration proceedings against this domain name (discussed infra 6-9), Kremer registered a second name, "bosleymedicalviolations.com," on March 29 2001.
The web sites that Kremer created using these domain names are quite simple and straight-forward. The site posted at "bosleymedical.com" consists of a home page that summarizes the DA's report about Bosley, along with five pages that republish, verbatim, factual findings from the California proceeding. The second site, "bosleymedicalviolations.com," contains verbatim quotes and summaries of the conclusions of several major institutions that have investigated Bosley, including the DA, and Maryland Board, and Dateline. Id., Exhibit Q. This site concludes with a series of links to other sites from which viewers can obtain other information about hair transplantation issues and about Bosley in particular. Id., Exhibit P.
Each of the sites is non-commercial. Kremer does not earn any revenue from any aspect of the sites, and they no banner advertising. Id. There are no goods or services sold on the sites. Neither Kremer nor, so far as he is aware, any member of his family has any investments or other interests in any competitor of Bosley's. Kremer pays the costs of the sites from his own pocket and receives no financial support for them from any other person. Id. ¶ 23.
The sites are direct in their criticisms of Bosley. On each site, the criticisms begin at the very top of the home page. No person viewing either site could suffer any uncertainty about whether Bosley as opposed to one of his critics is the sponsor of the page. Moreover, the title and "meta tags" on both sites make clear their critical attitudes toward Bosley, so that any person who finds Bosley's site through a search engine that supports meta tags, as many major search engines do, will learn as soon as they see the listing of search results that this page contains consumer criticism, and is not an official source of information created by Bosley. Id. ¶¶ 25-26.
Finally, each of the sites is completely "passive." There is no means by which members of the public can interact with the site, such as submitting requests for products, paying money to the site owner, or providing further information through the internet. Kremer Affidavit, ¶ 24. The sites provide email addresses for Kremer, but they have been deliberately placed near the very bottom of each page, so that only persons who have reviewed the entirety of the site and learned how hostile the site is to Bosley will reach the point where they could contact Kremer. Id. It is therefore impossible that any reasonable member of the public could be confused about whether they are writing to Bosley or to one of its critics.
On November 28, 2000, Bosley Medical Institute, Inc., and Bosley Medical Group (a different Bosley subsidiary incorporated in California) invoked the Uniform Dispute Resolution Policy ("UDRP") by filing a complaint with the Arbitration and Mediation Center of the World Intellectual Property Organization ("WIPO"). The UDRP is a procedure designed by the Internet Corporation for Assigned Names and Numbers ("ICANN"), the world Internet governance agency, to which all domain name registrars are required to subscribe, and which those registrars are obligated to impose on all persons who register domain names, to give trademark owners an opportunity to obtain quick resolution of claims that domain names violate their trademark rights. http://www.icann.org/udrp/udrp.htm. WIPO, in turn, is "an international organization dedicated to helping to ensure that the rights of creators and owners of intellectual property are protected worldwide," http://www.wipo.org/about_wipo/en/ gib.htm#P23_2347. Thus, by choosing WIPO as its arbitration forum, Bosley was ensuring that its complaints would receive a sympathetic hearing. Kremer Affidavit ¶ 17, citing Mueller, Rough Justice: An Analysis of ICANN's Uniform Dispute Resolution Policy, http://dcc.syr.edu/roughjustice.pdf; see also Geist, Fair.com?: An Examination of the Allegations of Systemic Unfairness in the ICANN UDRP (August 2001), http://aix1.uottawa.ca/~geist/geistudrp.pdf (study shows that, by allowing complainants to select arbitration provider, UDRP biases outcomes in favor of complainants).
Bosley's complaint alleged that Kremer had violated its common law rights in the trademark "Bosley Medical." It was compelled to invoke common law rights because, at that time, it had not yet registered that mark indeed, its request for the mark was only published for opposition on October 31, 2000, and registration was not granted until January 31, 2001. However, it argued that the original domain name, "bosleymedical.com", was identical or confusingly similar to its mark; that Kremer had no legitimate interest in using that domain name; and that, by using its mark in his domain name, Kremer necessarily acted in bad faith. Accordingly, Bosley demanded that Kremer be compelled to surrender the domain name to it.
In his February 28, 2001 decision, the arbitrator ruled against Bosley and in favor of Kremer. Kremer Affidavit, Exhibit N; http://arbiter.wipo.int/domains/decisions/html/2000/ d2000_1647.html. He began by assuming for the purpose of the case that Bosley had sufficient trademark rights in the name "Bosley Medical," and further found that Kremer's domain name "bosleymedical.com" was either identical or confusingly similar to that mark, as well as to the domain name for Bosley's own official site, "bosley.com." However, the arbitrator firmly rejected Bosley's remaining claims. First, he found that Kremer "has legitimate rights or interests in the Domain Name namely, to make information about Bosley more widely available." Id. at 3. In this regard, the arbitrator cited several previous arbitration decisions under the UDRP that had held that the registration of a domain name for the purpose of consumer criticism constitutes protected fair use, and thus is a legitimate use of the trademark. Id. at 4. Second, he ruled that Bosley had failed to establish bad faith. Bosley had not shown that any of the indicia of bad faith applied, and Kremer's intention to use the domain name to post litigation documents about Bosley and otherwise to further his goal of non-commercial consumer criticism directly rebutted the claim of bad faith. Again, the arbitrator cited several previous arbitration decisions that had upheld that the uses of domain names, even ones that were confusingly similar to an existing trademark, for purposes of consumer criticism, against claims of bad faith. Finally, the arbitrator concluded as follows:
Undeterred by this adverse ruling in a favorable forum, Bosley has now filed a complaint in this Court. Although both Bosley and Kremer, and Bosley's fellow UDRP complainant the Bosley Medical Group, are all based in California, Bosley has attempted to justify a suit in this forum by joining its Illinois affiliate, Bosley Medical Group S.C. ("BMGSC"), as a plaintiff, although BMGSC does not own the trademark and, indeed, is never discussed on Kremer's web sites. According to the complaint, the fact that Illinois residents may see the web sites is sufficient basis to compel plaintiff to come to Illinois to defend the case. Jurisdiction in this state is also asserted over the domain names themselves under the in rem provisions of the new federal cybersquatting statute on the ground that Tucows, a domain name registrar, does business here. However, the complaint does not contain an essential allegation under these in rem provisions namely, that plaintiff is unable to obtain in personam jurisdiction over defendant Kremer in order to proceed against him personally or to find him by sending him notice of an intent to proceed. 15 U.S.C. § 1125(d)(2)(A)(ii).
The complaint raises the same trademark claim that was litigated and lost in the UDRP arbitration proceeding, although the complaint never acknowledges that such an arbitrartion proceeding was ever held, not to speak of setting forth any factual basis for reaching a different result than the arbitrator did. Thus, the complaint alleges that the domain name "bosley.com" violates various provisions of the federal trademark laws, including the cybersquatting, infringement, dilution, and false designation of origin provisions. 15 U.S.C. §§ 1114, 1125(a), 1125(c), 1125(d). In an effort to present a claim that was not previously litigated, the complaint also adds that "bosleymedicalviolations.com" violates Bosley's trademark rights. However, the complaint again omits key allegations it never alleges that the domain names or other uses of plaintiff's marks are "used in commerce" or "commercial", as these provisions require. Moreover, although the infringement claim incorporates by reference the cybersquatting claim that Kremer's names are "confusingly similar" to Bosley's mark, it never alleges that Kremer's names or web site are likely to cause confusion with respect to the ownership or source of the web sites. Indeed, as discussed below, it is perfectly obvious from examining the sites that they are completely non-commercial and that any reasonable person would recognize from the first glance that the sites are sponsored by a critic of Bosley's, not by Bosley itself.
The complaint also alleges that Kremer's web sites libel the plaintiffs. However, the only basis for jurisdiction over this state law claim is that it is pendent to the federal claims. Moreover, the complaint does not quote a single one of the allegedly defamatory statements.
Kremer now moves to dismiss on numerous grounds. First, the Court lacks personal jurisdiction over Kremer, a California resident, under settled law that only commercially interactive web sites afford a basis for jurisdiction in any foreign state in which they may have been accessed; for similar reasons, venue is improper. Second, the Court lacks jurisdiction in rem, because plaintiffs' ability to locate Kremer and to sue him in California bars the exercise of in rem jurisdiction. Third, the failure to allege use in commerce and the obviously non-commercial character of the web sites themselves, which may be considered on a motion to dismiss because plaintiff has incorporated them into its complaint by alleging their domain names, stand as a fatal bar to proceeding under the trademark laws; likewise, the failure to allege likelihood of confusion, coupled with the obvious absence of confusion caused by the web sites , requires the dismissal of the infringement claim without leave to amend.
The state law claims should also be dismissed for lack of jurisdiction and for failure to state a claim. First, in the absence of any valid federal trademark claims, there is no basis for considering libel claims raised by a California plaintiff against a California defendant.(1)
Second, the failure to allege the libelous statements in haec verba is a fatal flaw on the face of the complaint. Third, nothing on the web sites makes any statements about BMGSC, whose only role in the case is to support the claim for personal jurisdiction in this forum. Fourth, because this controversy is between two California residents, in which Illinois has little interest, Illinois choice of law rules require the application of California law to the adjudication of the libel claim. Consequently, the California anti-SLAPP statute, which has been held applicable to diversity cases in federal court, allows a defendant to move to strike a complaint challenging a defendant's exercise of his right of free speech, unless the plaintiff can show a reasonable probability of succeeding on the merits. Under those standards, the complaint should be stricken, and plaintiffs should be required to pay defendant's attorney fees.
To be subject to in personam jurisdiction, Kremer must have "certain minimum contacts with [Illinois] such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.'" International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945) (citations omitted); Third Nat'l Bank v. Wedge Group, 882 F.2d 1087, 1089 (6th Cir. 1989). The minimum contacts test requires "in each case that there be some act by which the defendant purposely avails itself of the privilege of conducting activities within the forum state, thus invoking the benefits and protection of its laws." Hanson v. Denckla, 357 U.S. 235, 253 (1958). A defendant's connection with the state must be such that "it should reasonably anticipate being haled into court" in the state in the event of a dispute. Worldwide Volkswagen Corp. v. Woodson, 444 U.S. 286, 295-96 (1980).
The minimum contacts analysis generally requires assessment of whether the court is exercising "general" or "specific" jurisdiction. Bosley can not sustain its burden of proving either general or specific jurisdiction because the only conduct at issue -- Kremer's creation in California of a web site where he can express his unfavorable opinions as to Bosley and inform others about the hazards of using its services -- occurred outside Illinois and entailed no contact by Kremer with that state. Kremer Affidavit ¶ 4.(2)
The exercise of general jurisdiction requires that a defendant's contacts with the forum be "continuous and systematic." Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 416 (1984); see also Third Nat'l Bank, 882 F.2d at 1089. Even "continuous activity of some sorts within a state is not enough to support [general jurisdiction]." International Shoe, 326 U.S. at 318. "This is a fairly high standard in practice." Wilson v. Humphreys (Cayman) Ltd., 916 F.2d 1239, 1245 (7th Cir. 1990). Rather, for Illinois to assert general jurisdiction over a non-resident defendant, his contacts with Illinois must be of such a "continuous and systematic" nature that personal jurisdiction over the defendant is proper even if the action is unrelated to the defendant's contacts with the state. Id. Where a defendant is not licensed to do business in the forum state, does not maintain offices or employees there, and owns no property in the forum, the facts do not support the argument that there is general jurisdiction.
Michael Kremer does not live in Illinois; he owns no property in Illinois, does not do business in Illinois, and his only trips to Illinois were for brief periods long before the cause of action in this case arose. Kremer Affidavit ¶¶ 2-4. Kremer is a self-employed resident of California who does not compete with Bosley, and in any event his web site is unrelated to his employment. Id. ¶¶ 3, 23. The web site is something he maintains in his spare time, and he gains no monetary benefit from its operation. Kremer Affidavit ¶ 23. Nor does the complaint allege any facts supporting the exercise of general jurisdiction Clearly, Kremer does not have "systematic and continuous" contacts with the State of Illinois so as to support the exercise of general jurisdiction.
Specific jurisdiction is proper when the defendant's contacts with the forum are related to the controversy underlying the litigation. See Helicopteros, 466 U.S. at 414 n.8; RAR, Inc. v. Turner Diesel, 107 F.3d 1272, 1277 (7th Cir. 1997). To maintain specific personal jurisdiction, Bosley must show that: (1) Kremer has purposely availed himself of the privilege of conducting business or causing consequences in Illinois; (2) the cause of action arises from his activities in Illinois; and (3) his conduct has a substantial enough connection with Illinois to make the exercise of jurisdiction reasonable. The defendant's contacts with the forum state must have been sufficiently purposeful that the defendant should have had fair warning that he would be subject to suit there. Klump v. Duffus, 71 F.3d 1368, 1371-1372 (7th Cir. 1995).
The only basis mentioned in Bosley's complaint for a finding of personal jurisdiction is that specific jurisdiction is available because Illinois residents can visit Kremer's web site, and because Bosley may lose business in Illinois. ¶¶ 7-8. However, courts faced with such claims consistently rule that contact limited to viewing a non-resident defendant's non-commercial web site (or a commercial but merely passive web site) in the forum, is simply insufficient to warrant the assertion of personal jurisdiction.(3)
The sliding scale between passive and interactive web sites has been specifically followed by several decisions in the Northern District of Illinois, and this Court has described the rule as "settled law." E.g., Shapiro v. Santa Fe Gaming Corp., 1998 WL 102677; see also Transcraft Corp. v. Doonan Trailer Corp., 1997 WL 733905(fact that web site encourages communications by email or provides a toll-free number is not sufficient interactivity to warrant personal jurisdiction over claim that goods advertised on web site violated plaintiff's trademark); Scherr v. Abrahams, 1998 WL 299678 (fact that web site allowed viewers to add email addresses to list for email distribution of publications that allegedly libeled plaintiff and violated his trademarks was not sufficient interactivity for exercise of personal jurisdiction, where publications were sent free of charge). Only where the web site was not only interactive, but also enabled the sale of goods in Illinois, have the sites been deemed sufficient to warrant the exercise of personal jurisdiction. E.g., International Star Registry v. Bowman-Haight Ventures, 1999 WL 300285; Vitullo v. Velocity Powerboats, 1998 WL 246152; accord, First Financial Resources v. First Financial Resources Corp., No. 00-CV-3365 (N.D. Ill., 11/08/2000) (key question determining existence of personal jurisdiction in this District is the level of commercial activity that may be conducted through the site).
An excellent example of this line of cases is the opinion in Berthold Types Ltd. v. European Mikrograf Co., 102 F. Supp.2d 928 (N.D. Ill. 2000). In that case, two companies that market typefaces were in litigation over whether the defendant's font software violated the plaintiff's trademarks. "The exercise of jurisdiction is ultimately determined by examining the level of interactivity and the commercial nature of the exchange of information." Id. at 933. Although the web site enabled potential customers to interact with the defendant, and enabled existing customers to access information about their commercial relationship with the defendant, jurisdiction was lacking because sales could not actually be conducted over the site.
Michael Kremer's web site is not only passive, but entirely non-commercial. Kremer Affidavit ¶¶ 23-24. Kremer's message is not in any way targeted at reaching Illinois residents. See IMO Indus., Inc. v. Kiekert AG, 155 F.3d 254, 265 (3d Cir. 1998) (affirming dismissal based on lack of personal jurisdiction because tortious conduct was not expressly aimed at the forum). Kremer is not selling anything, and his web site contains no advertisements for the sale of products and services. Kremer Affidavit ¶ 23. Accordingly, there is no basis for personal jurisdiction over Kremer in Illinois.
In Bensusan Rest. Corp. v. King, 937 F. Supp. 295 (S.D.N.Y. 1996), aff'd, 126 F.2d 25 (2d Cir. 1997), a St. Louis jazz club published a web site using its name, the Blue Note, which was the same as the world-famous club in New York City. The New York club sued for trademark violations, but the district court refused to exercise jurisdiction, because, as here, defendant had no presence of any kind in the forum "other than the Web site that can be accessed worldwide." 937 F. Supp. at 301. The court found that to permit jurisdiction in New York would have violated due process because the defendant did not actively seek to encourage residents of the forum to access the site and conducted no business in the forum. As the court stated, "[c]reating a [web] site, like placing a product into the stream of commerce, may be felt nationwide or even worldwide but, without more, it is not an act purposefully directed toward the forum state." Id., citing Asahi Metal Indus. Co. v. Superior Court, 480 U.S. 102, 112 (1992). The basis for asserting personal jurisdiction over Kremer is even weaker because his web site conducts no business of any kind whatsoever. Kremer Affidavit ¶ 15.
In essence, Bosley's implicit assertion is that jurisdiction over Kremer is proper in Illinois because some of the entities allegedly harmed by Kremer's California web site are located in Illinois in effect, that the tort was committed in Illinois. Even if this argument were sound, it would not be a basis for permitting both plaintiffs to sue here, because Bosley Medical Institute is based in Beverley Hills, California. Yet the Illinois plaintiff, Bosley Medical Group S.C., does not own the trademark at issue and is never mentioned on the web site. Moreover, the Seventh Circuit has previously rejected the proposition that a defamatory statement made in the defendant's home state constitutes a tort committed in the plaintiff's home state, even if the defendant knew that the plaintiff was located there. Nelson v. Bulso, 149 F.3d 701 (7th Cir. 1998). Neither does the mere inclusion of a trademark in a non-commercial Internet site subject a defendant to personal jurisdiction in the home state of the trademark holder. We have found no case authorizing personal jurisdiction solely on that basis, and squarely to the contrary are cases such as Mid City Bowling Lanes & Sports Palace v. Ivercrest, 35 F. Supp. 2d 507, 511-512 (E.D. La. 1999), aff'd mem., 208 F.3d 1006 (5th Cir. 2000) (even in a commercial context, inclusion of a trademark is insufficient to support personal jurisdiction).
If any tort was committed, it was in California, where the web site was created, or arguably in the state (not Illinois) where the HTML code was loaded onto the server. Kremer Affidavit ¶ 4. See Compuserve v. Patterson, 89 F.3d 1257, 1268 (6th Cir. 1996) (jurisdiction could be exercised in Ohio over a defendant who had loaded his software onto the plaintiff's server in Ohio, but Court pointedly declined to extend its holding to any Internet user who happened to use the software on a computer in a different state). In sum, Illinois's interest in protecting Bosley from one California man's exercise of his First Amendment rights is slim, and does not trigger exercise of personal jurisdiction based upon the Illinois long-arm statute.
Indeed, a finding of jurisdiction here would have chilling implications for citizens' right to speak freely about corporations and state officials that they believe have wronged them. This case is not, after all, about a manufacturer or entrepreneur who placed a product in the stream of commerce in the hopes of making profits, an expectancy which can be balanced against the danger of being sued in some location where the product came to rest and caused injury. Every person who posts an opinion on the Internet knows that persons sitting at computers not just in their own country, but in foreign lands half way around the globe, may gain access to their views by the simple act of "clicking on their link" or finding them through a search engine. If citizens knew that they could be forced to defend themselves against litigation in every such forum, they would surely be chilled in the exercise of their First Amendment rights.(4)
This danger is amply shown by the case before the Court. Michael Kremer is an individual living and working in California who feels compelled to speak as a result of his dealings with Bosley. He sought redress through his local courts for wrongs he believed to have been committed by Bosley's Washington facility, but his lawsuit was not successful. Exhibit E at 8-9, ¶¶ 12(xii) and (xiii). Subsequently, Kremer developed a web site where he could express his opinion that Bosley's services are not to be trusted. Id. ¶ 14. Kremer is not a competitor of Bosley or any of its affiliates, nor does he derive any financial benefit from his non-commercial web site. Id. ¶ 23. Kremer merely created a forum where he can express his opinions about the plaintiffs' business practices and where others can send him their thoughts, whether they be pro-Bosley or anti-Bosley. . And yet he has been haled into court more than half way across the country, where he knows nobody and where he has never even visited. Kremer has done nothing to purposefully avail himself of the privilege of conducting activities within Illinois. Her creation of a non-commercial web site from his home in Carlsbad, California, certainly has not given him reason to "reasonably anticipate being haled into court" in Illinois. Consequently, Bosley's action should be dismissed for lack of personal jurisdiction.
Although undersigned counsel do not represent Tucows, which will presumably enter its own appearance in this case, we address the Court's jurisdiction over Count III against Tucows lest plaintiff seek to defend its exercise of jurisdiction over Kremer on the ground that its suit is pendent to the in rem action against Tucows. The Court has no jurisdiction of that claim both because Count III lacks a required allegation for in rem jurisdiction and because that element cannot possibly be satisfied.
Under 15 U.S.C. § 1125(d)(2)(A)(ii), a plaintiff cannot invoke in rem jurisdiction over a domain name by serving process on the domain name registrar that holds it unless the Court finds that plaintiff is able neither to obtain in personam jurisdiction over defendant Kremer in order to proceed against him personally, or nor to find him by sending him notice of an intent to proceed. The burden of alleging and proving these facts rests on the plaintiff. Lucent Technologies v. Lucentsucks.com, 95 F. Supp.2d 528, 531-534 (E.D. Va. 2000); Healthmount A.E. Corp. v. Technodome.com, 106 F. Supp.2d 860, 862-863 (E.D. Va. 2000); Banco Inverlat v. www.inverlat.com, 112 F. Supp.2d 521, 522 n.1 (E.D. Va. 2000); Hartog & Co. v. Swix.com, 136 F. Supp.2d 531, 536 (E.D. Va. 2001). In this sense, in rem and in personam jurisdiction are mutually exclusive the plaintiff cannot invoke both. Alitalia-Linee Aeree v. Casinoalitalia. com, 128 F. Supp.2d 340, 344-347 (E.D. Va. 2001).(5)
The first reason why Kremer's web sites is that each of the trademark provisions under which the plaintiffs has sued requires a nexus to "commerce" that is not satisfied here, and that is not alleged in the complaint. This nexus appears in two forms.
The Lanham Act creates a cause of action for trademark infringement, Section 32 of the Lanham Act, 29 U.S.C. §§ 1114(1)(a) and (b), and for false representation of origin, Section 43(a) of the Lanham Act, 29 U.S.C. § 1125(a)(1), only when the defendant "uses[d] in commerce" the trademark of the plaintiff. As the Supreme Court reminded us only last Term, statutory terms that include the word "commerce" do not necessarily reach to the full breadth of the commerce power, but must be construed as commanded by each particular statute. Circuit City Stores v. Adams, 121 S. Ct. 1302, 1308-1310 (2001) (unlike term "involving commerce," term "engaged in commerce" does not reach to full extent of commerce clause, but covers only workers in transportation industries). "Use in commerce" is expressly defined by Section 45 of the Lanham Act, 15 U.S.C. § 1127, as meaning "bona fide use of a mark in the ordinary course of trade . . .." Without "use in commerce," there is no violation of sections 32 and 43(a). Endoscopy-America v. Fiber Tech Medical, 243 F.3d 538 (4th Cir. 2001), table case web-published at http://pacer.ca4.uscourts.gov/opinion.pdf/001032.U.pdf. Kremer engages in none of these activities. "The act's purpose, as defined in Section 45, is exclusively to protect the interests of a purely commercial class against unscrupulous commercial conduct." Colligan v. Activities Club of New York, Ltd., 442 F.2d 686, 692 (2d Cir. 1971). See also S. Rep. 100-515, 100th Cong., 2d Sess. 44 (1988), reprinted in 1988 U.S. Code Cong. Ad. News 5577, 5607 ("Amendment of the definition of 'use in commerce' [in section 45 of the Lanham Act) is one of the most far-reaching changes the legislation contains. . . . The committee intends that the revised definition of 'use in commerce' be interpreted to mean commercial use which is typical in a particular industry.") (emphasis added); accord, Chance v. Pac-Tel Teletrac, 242 F.3d 1151, 1157 (9th Cir. 2001).
The remaining causes of action apply only to "commercial" speech. Thus, the dilution subsection of Section 43(c) of the Lanham Act, 29 U.S.C. § 1125(c), contains the following proviso, section 43(c)(4) "The following shall not be actionable under this section: . . . (B) Noncommercial use of the mark (C) All forms of news reporting and news commentary." When the cause of action for dilution was federalized in 1989, this exclusion was included; the House Judiciary Committee explained the purpose was to ensure that non-commercial speech would not be affected:
The purpose of the statute's noncommercial use exception was to protect "'parody, satire, editorial and other forms of expression that are not part of a commercial transaction.'" Dr. Seuss Enterprises v. Penguin Books USA, 924 F. Supp. 1559, 1574 (S.D. Cal. 1996), aff'd, 109 F.3d 1394 (9th Cir. 1997), quoting Congressional Record statement of Senator Hatch. Moreover, because the new cybersquatting law was enacted as Lanham Act subsection 43(d), 15 U.S.C. § 1125(d), it is plainly covered by the exclusion of noncommercial and consumer commentary, which applies to everything in "this section." Indeed, Congress included a savings clause that explicitly disclaimed any intent that the cybersquatting law override either the First Amendment or section 43(c)(4) of the Lanham Act. Public Law 106-113, Section 3008, 113 STAT. 1501A-551. The sponsors of the cybersquatting law specifically disclaimed any intention to provide a cause of action against persons who registered domain names for the purpose of delivering comment or criticisms of trademark owners by identifying the owners with their marks. See House Report 106-412, 106th Cong. 1st Sess. (1999), at 10.
The complaint never squarely alleges that Kremer's site is "used in commerce" or is "commercial"; at best, it makes scattered allegations that dance around the question of whether it is "non-commercial." It is not that plaintiffs do not know how to allege commercial use they allege that they "have made commercial use of said marks." ¶ 49.
But when it comes to making allegations about the defendant and his web sites, there is no allegation at all relating to commerce in the paragraphs relating to all counts, ¶¶ 1-29. Turning to Count I, which seeks damages under the cybersquatting subsection of the Lanham Act, Section 43(d), Bosley asserts that Kremer has a bad faith intent to "profit" from plaintiffs' mark "in that his aforesaid web sites . . . allow him to derive benefit and pleasure," ¶ 32(A); even assuming that "profit" can include "pleasure," such pleasure surely does not equate to commercial use. Then in paragraph 32(B), Bosley includes two negative allegations, but only in the alternative: "not used . . . in connection with bona fide noncommercial or fair use," ¶ 32(B)(5), and "either for commercial gain or with the intent to tarnish or disparage the mark." ¶ 32(B)(6). There is never, however, an express allegation that Kremer used the marks commercially. Count II, which demands an injunction for cybersquatting, contains no further allegations relating to commerce. Nor does Count III, which alleges an in rem claim under the cybersquatting subsection against Kremer's domain names. Similarly, Count V's allegations of trademark dilution under section 43(c) contain no reference at all to defendant's being engaged in anything other than non-commercial activity. Accordingly, these four Counts should be dismissed for failure to include this essential allegation.
Count IV, which alleges trademark infringement under section 32, includes no reference to an alleged "use in commerce." Count VI, alleging unfair competition under section 43(a), suffers from the same flaw. These two counts should therefore be dismissed for failure to state a claim.
Moreover, because the web sites are alleged in the complaint, the Court may look beyond the written allegations in the complaint and consider the contents of the documents on which the complaint is based. Venture Assoc. v. Zenith Data Sys., 987 F.2d 429, 481 (7th Cir. 1993) ("Documents that a defendant attaches to a motion to dismiss are considered part of the pleadings if they are referred to in the plaintiff's complaint and are central to her claim."). Accord, PBGC v. White Consol. Indus., 998 F.2d 1192, 1196 (3d Cir. 1993); Cortes Indus. v. Sum Holding, 949 F.2d 42, 47-48 (2d Cir. 1991). Such notice may include records publicly available on the World Wide Web. Cairns v. Franklin Mint Co., 107 F. Supp.2d 1212, 1216 (C.D.Cal. 2000); Modesto Irrigation Dist. v. Pacific Gas & Elec. Co., 61 F. Supp. 2d 1058, 1066 (N.D. Cal. 1999).
The web sites are attached to Kremer's affidavit as Exhibits P and Q. It is readily apparent that they are entirely non-commercial. They contain are no advertisements, no sales, no nexus to commerce whatsoever. They are plainly and simply expressions of Kremer's opinions about Bosley, and republication of the findings of law enforcement agencies and well-established and respected media outlets concerning Bosley. They are not actionable under the Lanham Act..
In a few cases, courts have suggested that certain web sites and domain names were rendered "commercial" by dint of their potential for adverse impact on the commercial activities of the plaintiffs in those case. E.g., Trade Media Holdings v. Huang & Assoc., 123 F. Supp.2d. 233, 242 (D.N.J. 2000); Christian Science Bd. v. Robinson, 123 F. Supp.2d 965, 971 (W.D.N.C. 2000), aff'd, -- F.3d -- (4th Cir. 2001) (citing several cases); Bihari v. Gross, 119 F. Supp.2d 309, 317 (S.D.N.Y. 2000). The plaintiffs' allegation that defendant's use of their trademarks is having an adverse effect on their business, ¶¶ 32(A), 42, is presumably intended to bring this case under the shelter of this construction of the Lanham Act.
However, in every one of these cases, the opinion goes on either to uphold the defendant's use of the mark, or to find that the defendant was using the mark to raise money or sell its own goods or services or the goods of some other person; admittedly, even a non-profit group uses a trademark "in commerce" when it seeks to raise funds or sell goods or services. Consequently, the cited language is plainly dictum. Nor are these dicta persuasive. None of the cases discuss the statutory term "use in commerce" and explain how their dictum is consistent with the statutory definition of that term and with Congress' evident intent to confine the meaning of that term. Moreover, if any use of a trademark becomes "commercial" simply because it has an adverse impact on the plaintiff's commercial activities, then all consumer commentary and all news reporting would automatically be commercial, and Congress' 1996 amendment of section 43, and the 1999 proviso to the cybersquatting statute that explicitly preserves the protections of that 1996 amendment for the registrants and users of domain names, not to speak of its strict definition of the term "use in commerce," would be rendered nugatory. Accordingly, the Court should not follow these dicta, but should rather dismiss the complaint without leave to amend.
The trademark claims should also be dismissed under section 12(b)(6) because that no reasonable person could possibly be confused about whether Bosley is the sponsor of Kremer's web sites. Likelihood of confusion with respect to the course, sponsorship or affiliation of the goods or services that is being labeled is a key element of both an infringement cause of action under section 32 of the Lanham Act and a false description of origin claim under section 43 of the Lanham Act.
Count IV, which purports to state a cause of action for trademark infringement, does not contain any allegation that anything about Kremer's web site is likely to cause confusion with respect to source. The only aspect of Count IV that has any relationship to confusion is its incorporation by reference of earlier paragraphs of the complaint, which allege that Kremer's domain names are "identical or confusingly similar" to the plaintiff's marks. That allegation is not at all the same as alleging likelihood of confusion with respect to source, and Count IV should be dismissed for this reason.
Count VI should also be dismissed. Although it alleges likelihood of confusion, the web sites themselves can be considered on this motion to dismiss, as discussed supra at pages 23-24, and it is perfectly apparent that no reasonable person could be confused about whether those sites are sponsored by Bosley. And a Lanham Act claim does not lie based on a domain name that is used to publish a web site that contains nothing but consumer criticism of the trademark owner, even if the domain name itself is identical or confusingly similar to the mark. Thus, in Northland Ins. Cos. v. Blaylock, 115 F. Supp.2d 1108, 1124 (D.Minn. 2000), a consumer, whose insurance company paid him less than he thought he deserved, registered "northlandinsurance.com" as the domain name for a web site describing his grievances against the company. The district court refused to find likelihood of confusion, because, even if someone visited the web site accidentally, on the assumption that it was the insurance company's own, any initial confusion would be immediately dispelled by the obviously critical nature of the site, and such temporary confusion does not amount to likelihood of confusion.
Finally, insofar as the complaint is directed at the domain name "bosleymedicalviolations.com", all Lanham Act allegations should be dismissed despite the fact that the complaint alleges both "confusing similarity" and, with respect to section 43(a), likelihood of confusion, because this name is not confusing as a matter of law. We understand from plaintiff's counsel that his argument for confusion will be that, if a member of the public wants to find Bosley's web site and, instead of resorting to a search engine to find Bosley, just guesses about Bosley's internet address and types the letters "bosleymedical.com" into the location window of his web browser, he will reach Kremer's site rather than plaintiff's site. However, it is simply incredible that any person who is hoping to find Bosley would type "bosleymedicalviolations" into his web browser. Several decisions state that when trademarks are coupled with words of criticism in domain names, there is no cause of action under the Lanham Act or the cybersquatting law. Lucent Technologies v. Lucentsucks.com, 95 F. Supp.2d 528, 535-536 (E.D. Va 2000); Bally Total Fitness Holding Corp. v. Faber, 29 F. Supp. 2d 1161, 1165 n.2 (C.D. Cal. 1998). The only cases involving critical sites where courts have found any chance of confusion were cases where the critical site used the trademark itself as the domain name. E.g., People for the Ethical Treatment of Animals v. Doughney, 113 F. Supp.2d 915 (E.D. Va. 2000) (group calling itself People Eating Tasty Animals cybersquatted on "peta.org"). And even in such cases, however, the plaintiff has not always prevailed on its "likelihood of confusion" claim. See Northland Ins. Cos. v. Blaylock, 115 F. Supp.2d 1108, 1117-1122 (D. Minn. 2000) (defendant used "northlandinsurance.com" to publicize grievances against Northland Insurance Company). Thus, the domain name "bosleymedicalviolations," there is no likelihood of confusion as a matter of law, and there is no confusing similarity as a matter of law, and the infringement, false designation of origin, and cybersquatting counts based on this name should be dismissed for failure to state a claim.
Because the Lanham Act does not have a special venue provision, the general venue statute is applicable to actions brought pursuant to the Act. Woodke v. Dahm, 70 F.3d 983, 985 (8th Cir. 1995). Because jurisdiction is based on a federal claim, to justify venue in the Northern District of Illinois, plaintiffs must show either that Kremer resides in the Northern District of Illinois or that "a substantial part of the events or omissions giving rise to the claim occurred" in the Northern District of Illinois. 28 U.S.C. § 1391(b). Kremer resides in Carlsbad, California. Complaint ¶ 17. Thus, the only basis for venue in this action would have to be that a substantial part of the actions giving rise to Bosley's claim occurred in the Northern District of Illinois. Even a cursory inspection of the facts of this case, however, clearly shows that the only acts giving rise to Bosley's claims occurred outside Illinois.
The purpose of the general federal venue requirement is to protect the defendant against plaintiffs who may select an unfair or inconvenient place of trial. See Leroy v. Great Western United Corp., 443 U.S. 173, 183-184 (1979). Kremer has never lived in Illinois, and he has not set foot in Illinois since long before his first contact with Bosley. Kremer Affidavit ¶ 2. Although her web site can be visited from a computer in Illinois, as it can from computers in the other 49 states and the rest of the world, the web site was created in California. Id. ¶ 4. Nor is the server from which the site is uploaded to the world wide web located in Illinois, and Kremer places his web site on that server from his home computer California. Any insertion of plaintiffs' marks in the domain name occurred there. Id. ¶ 4. Cf. Nine Point Mesa v. Nine Point Mesa, 769 F. Supp. 259, 261 (M.D. Tenn. 1991) (determining that proper venue inquiry is where infringing activity occurred).
It certainly cannot be said that a "substantial part" of the acts creating a basis for Bosley's claim occurred in the Northern District. See, e.g., Eastman v. Initial Inv., 827 F. Supp. 336, 338 (E.D. Pa. 1993) (undertaking to "weigh" the contacts to determine whether venue should be had in one forum or another); accord, Holiday Rambler Corp. v. Arlington Park Dodge, 204 U.S.P.Q. 750, 751 (N.D. Ill. 1979); Hindu Incense v. Meadows, 439 F. Supp. 844 (N.D. Ill. 1977). It has been specifically held that the mere fact that a minor fraction of an allegedly infringing publication was distributed in a foreign jurisdiction is insufficient to support venue for a trademark action. Transamerica Corp. v. Transfer Planning, 419 F. Supp. 1261, 1263 (S.D.N.Y.. 1976), cited with approval, Chicago Reader v. Metro College Pub., 495 F.Supp. 441, 443 (N.D..Ill. 1980). Thus, if the Court is unwilling to dismiss this matter for lack of personal jurisdiction, it should dismiss for lack of venue.
Plaintiff's action to enforce its trademark implicates the First Amendment even though plaintiff is not a government actor. Relief sought by private parties is still government action by a court, which is therefore subject to scrutiny under the First Amendment.(6)
In trademark cases, unlike copyright cases where fair use is co-extensive with the First Amendment, e.g., Harper & Row v. Nation Enterprises, 471 U.S. 539, 560 (1985), First Amendment considerations routinely receive separate discussion, although they also inform statutory interpretation. Where, as here, the defendant is engaged in non-commercial speech, the mere application of trademark law may violate the First Amendment. L.L. Bean v. Drake Publishers, 811 F.2d 26, 32-33 (1st Cir. 1987). Even if a trademark has been used in a commercial context, courts are required to construe the trademark laws narrowly to avoid impingement on First Amendment rights, e.g., Cliffs Notes v. Bantam Doubleday, 886 F.2d 490, 494 (2d Cir. 1989); First Amendment interests are weighed as a factor in deciding whether a trademark violation should be found, e.g., Anheuser-Busch v. Balducci Publications, 28 F.3d 769, 776 (8th Cir. 1994); and injunctions must be narrowly crafted to comply with the rule against prior restraints of speech. Id. at 778; Better Business Bureau v. Medical Directors, 681 F.2d 397, 404-405 (5th Cir. 1982).
Plaintiffs cannot dispute that Kremer's web site is protected by the First Amendment. Numerous cases hold that consumer commentary is core speech protected by the First Amendment. See, e.g.., Bose Corp. v. Consumers Union, 466 U.S. 485 (1984) (New York Times standard applied in libel action brought by a manufacturer claiming that consumer group had maligned its product). Many other cases have similarly treated criticisms of a company's products or business practices as speech protected by the First Amendment, although commercial speech principles applied to criticism by competitors.(7)
Kremer's use of the domain names "bosleymedical" and "bosleymedical violations" for his web sites is just the sort of consumer commentary that courts fastidiously protect. Kremer's criticisms would be pointless if he had to omit the name of the company he is criticizing. Furthermore, it is not just the web site generally, but Kremer's use of plaintiff's trademark in his domain name, that constitutes protected speech. After all, courts have repeatedly held that the use of trademarks constitutes speech within the protection of the First Amendment.(8)
Use of a trademark in the domain name is analogous to the use of a trademark in the title of a creative work, to which the courts give First Amendment protection because it is part of the author's expression, calling attention to the fact that the work in question contains content that may interest them.(9)
By the same token, Kremer's use of Bosley's name in his domain name serves to communicate to web users that his site that contains information about that company.(10)
Thus, judges have recognized that the selection of domain names to communicate the content of a web site implicates First Amendment rights.(11)
In many cases, courts have struggled to decide whether a particular use of trademarks constituted commercial or non-commercial speech. This question is significant not only because Congress limited the application of section 43 of the Lanham Act to cases of commercial speech, see sections 43(a)(1)(B) and 43(c)(4)(B), 15 U.S.C. §§ 1125(a)(1)(B), 1125(c)(4)(B), but also because commercial speech receives less protection under the First Amendment. Dun & Bradstreet v. Greenmoss Bldrs., 472 U.S. 749, 762-763 (1985). Indeed, recognition that the First Amendment would bar claims for false statements in non-commercial speech underlay Congress' establishment of the "commercial" requirement in section 43. Semco v. Amcast, 52 F.3d 108, 111-112 (6th Cir. 1995) (quoting extensively from the legislative history).
Thus, when one company has, in the course of an advertising campaign, made statements about another company's products, the courts in cases like Semco have hammered out a multi-factor test to determine when the statements are non-commercial, and thus entitled to full First Amendment protection, or commercial, and thus entitled only to have their First Amendment interests weighed as part of a fair use or fair commentary defense. Similarly, when a seller of T-shirts or some other commercial product spoofs a trademark or uses a trademark to denounce a political position, the courts have had to decide whether the alleged infringer or diluter is predominantly engaged in commentary, thus obtaining greater protection under the First Amendment, or mainly making use of a trademark to sell its own product.(12)
However, when an action is brought against a plainly non-commercial use of a trademark for either political or consumer commentary, the courts have not hesitated to afford full First Amendment protection against the trademark holder's claim, either by holding that First Amendment principles bar application of the federal statute, or by holding that the state law in question is unconstitutional on its face or as applied to the particular case.(13)
A review of Kremer's web site plainly shows his site's non-commercial character. The web site is dedicated to the communication of opinions and information about Bosley. The web site contains no advertisements (which is how many web sites produce revenues for their operators), and is not directed to selling or promoting any goods or services. In addition, as Kremer's affidavit shows, he derives no financial benefit from the web site, and he has no financial connection either to Bosley or to any competitor of that company. Kremer Affidavit ¶ 23. In short, because it is non-commercial, the speech on the web site is entitled to full constitutional protection.
In this regard, one final point about plaintiffs' trademark claim deserves mention Bosley already brought, and lost, its key domain name claim in arbitration, in a forum that it selected. Despite the fact that Bosley deliberately selected the arbitration forum that has a track record of ruling in favor of trademark holders, the arbitrator flatly rejected its claim and concluded that Bosley was "cyberbullying" hiding behind its trademark rights as a basis for squelching criticism. Although Bosley is entitled to de novo consideration of its legal claims in this Court, its failure even to mention this fact, and to explain why the Court should reach a different conclusion, surely casts doubt on the bona fides of its legal claim.
As the arbitrator ruled, several other arbitrators under the UDRP have similarly ruled that the use of another's trademark in a domain name, to identify the subject of commentary or consumer criticism, is a completely fair use of the word or phrase that does not run afoul of trademark owners' rights. Mayo Foundation for Education and Research v. Briese, http://www. arbforum.com/domains/decisions/96765.htm (2001); UEFA v. Hallam, http://arbiter.wipo.int/ domains/decisions/html/2001/d2001-0717.html (2001); see also Springsteen v. Burgar, Case No. D2000-1532 (WIPO Arbitration Panel, 1/25/01), http://arbiter.wipo.int/domains/decisions/html/ 2000/d2000-1532.html ("Users fully expect domain names incorporating the names of well known figures in any walk of life to exist independently of any connection with the figure themselves, but having been placed there by admirers or critics as the case may be.") RMO Inc v. Burbidge, http://www.arbforum.com/domains/decisions/96949.htm (2001): "The use of domain names for non-commercial purposes is a recognized method of proving rights and legitimate interests on the part of such user even when the use may cause some disadvantage or harm to other parties. See Kendall v. Mayer, D2000-0868 (WIPO Oct. 26, 2000), TMP Worldwide, Inc. v. Potter, D2000-0536 (WIPO Aug. 5, 2000); See also Lockheed Martin Corp. v. Etheridge, D2000-0906 (WIPO Sept. 24, 2000)."
These rulings are consistent with the language and the legislative history of the cybersquatting law, which recognize that it is proper to register a domain name that incorporates another person's trademark so long as the registrant has a legitimate basis for selecting that name. Cello Holdings v. Lawrence-Dahl Companies, 89 F. Supp.2d 464 (S.D.N.Y. 2000); Northland Ins. Cos. v. Blaylock, 115 F. Supp.2d 1108 (D. Minn. 2000). Indeed, 15 U.S.C. § 1125(d)(1)(B)(ii) provides that "Bad faith intent . . . shall not be found in any case in which the court determines that the person believed and had reasonable grounds to believe that the use of the domain name was a fair use or otherwise lawful." As the House, Senate and Conference Committees stated, in almost identical language in their respective reports on the bill,
Surely, where the name has been registered by a dissatisfied customer and has been used to establish a web site that is engaged in non-commercial consumer criticism a fact that is easily discernible from the web site itself this Court should endorse the arbitrator's "cyberbullying" label and promptly dismiss the case.
Plaintiff Bosley Medical Institute is a Delaware corporation whose principal place of business is located in Beverly Hills, California; under 28 U.S.C. § 1332(c)(1), BMI is a citizen of the state of California. Defendant Kremer is also a citizen of California. Because complete diversity does not exist (and, in any event, as discussed infra at 36-37, nothing in Kremer's web site addresses the activities of the Illinois defendant, Bosley Medical Group, S.C.), the only way for the Court to obtain jurisdiction of this case would be under the doctrine of pendent jurisdiction. However, the federal claims are all subject to dismissal as discussed earlier in this brief, for lack of personal jurisdiction, for improper venue, and for failure to state a claim on which relief can be granted. Accordingly, the state law claims should also be dismissed for lack of jurisdiction.
The second reason for dismissing the libel counts is that the complaint is facially inadequate, in two respects.
The libel counts should be dismissed in their entirety because the plaintiff has not pleaded the defamatory words. The courts in this district have repeatedly held, in concert with federal courts across the country, that claims for defamation must be pleaded in haec verba. E.g., Smith v. Chicago Park Dist., 1999 WL 33883 (N.D. Ill. 1999), at *4, aff'd mem., 221 F.3d 1339 (7th Cir. 2000); Seaphus v. Lilly, 691 F. Supp. 127, 134 (N.D. Ill. 1988); Derson Group v. Right Mgmt Consultants, 683 F. Supp. 1224, 1229 (N.D. Ill. 1988)); accord, Bobal v. RPI, 916 F.2d 759, 763 (2d Cir. 1990); Asay v. Hallmark Cards, 594 F.2d 692, 699 (8th Cir. 1979).(14)
As Judge Shadur has explained, only by such pleading does the plaintiff give the defendant a fair opportunity to file a proper answer to the complaint, or to discern whether the words alleged to be actionable may be subject to dismissal for such reasons as that they are because they are protected opinion. Vantassell-Matin v. Nelson, 741 F. Supp. 698, 707 (N.D.Ill.1990) (plaintiffs alleging defamation must recite the precise language alleged to be defamatory). See also this Court's discussion in Jones v. Sabis Educational Systems,1999 WL 1206955 (N.D.Ill.1999), at *4. Here, the complaint pleads the general subjects that are alleged to be defamatory "fraud, misrepresentation and unethical procedures", ¶ 48(A); "altering patients records, allowing laypersons to perform surgical procedures, and using false and misleading statements," id.; and "misrepresenting the number [and] cost [and] result of the treatments,"¶ 48(B) but leaves the defendant to guess exactly which parts of his multi-page web sites are the particular ones alleged to be defamatory. The libel claims should therefore be dismissed.
In addition, although the law is clear that a corporation may sue for libel, just as an individual can, the rule that libel is personal to the one defamed applies as much to corporations as to individuals. Thus, a corporation or group can not sue for libel unless the defamatory words are "of and concerning" that corporation. Darling v. Piniella, 1991 WL 193524 at *2 (S.D.N.Y.) Church of Scientology of California v. Flynn, 578 F. Supp. 266, 268 (D. Mass. 1984); National Nutritional Foods Ass'n v. Whelan, 492 F. Supp. 374, 380 (S.D.N.Y. 1980); Security Sales Agency v. AS Abell Co., 205 Fed. 941 (D. Md. 1913).(15) And although there are circumstances in which a corporation may sue for libelous statements made about the actions of its employees, on the ground that the criticisms amount to an attack on it, the courts are quite strict in barring the reverse situation, where a subordinate or member seeks to sue based on a libel directed to the corporation or group to which he belongs. Stock v. Heiner, 696 F. Supp. 1253, 1259 (D. Minn. 1988); Saenz v. Playboy Enterprises, 653 F. Supp. 552, 560 (N.D. Ill. 1987), aff'd, 841 F.2d 1309 (7th Cir. 1988) (in affirming, court requires plaintiff to prove by clear and convincing evidence that defendant knew of implication that the particular plaintiff was identified by the statement); Provisional Gov't of New Afrika v. ABC, 609 F. Supp. 104, 108 (D.D.C. 1985); see McBride v. Crowell-Collier Pub. Co., 196 F.2d 187 (5th Cir. 1952).
The position of Bosley Medical Group, S.C., the Illinois subsidiary, in this case is analogous to that of the employees or group members who have tried to sue over criticisms of their group. Its argument is presumably that Kremer's criticism of Bosley damages it, as well. But the web pages on which the complaint is based, see page 23, supra, contain nothing that relates to BMGSC, either by name or by describing BMI's conduct in its Chicago office. Accordingly, BMGSC's part of the complaint must be dismissed, and the case may go forward, if at all, only with respect to BMI.
Finally, the libel claims of the main plaintiff, Bosley Medical Institute, should be dismissed because they represent strategic litigation against public participation, and hence are subject to being stricken under California law. Under choice of law principles, California law applies to this lawsuit, and California's anti-SLAPP statute is a substantive rule that is to be applied when state law claims are adjudicated in federal court. This lawsuit is covered by the SLAPP statute because it is directed at Kremer's exercise of his right of free speech, and under the standards of the SLAPP statute, the complaint must be stricken and defendant is entitled to an award of attorney fees unless the plaintiffs can show, through the introduction of sufficient evidence, that they have a reasonable probability of success on the merits. Because plaintiffs have not and cannot make that showing, the complaint should be dismissed.
Because this case is pending in a federal court in Illinois, Illinois choice of law principles govern the question of which state's law applies. In that regard, Illinois follows a strict rule that the law of the plaintiff's domicile governs. Cook v. Winfrey, 141 F.3d 322, 329 (7th Cir. 1998). Because Bosley is headquartered in California, and California is where the defendant lives as well, California's is the law that should govern. Indeed, it would be a disastrous invitation to forum shopping if, in an effort to avoid the protection for free speech that California extends to citizens under its SLAPP statute, a California company could invoke the existence of an out-of-state subsidiary to evade the SLAPP statute.
Moreover, it is well established that the SLAPP statute is a substantive protection of California law, and not a merely procedural rule that does not follow a diversity case into federal court. United States ex rel. Newsham v. Lockheed Missiles, 190 F.3d 963, 970-973 (9th Cir. 1999). The statute has been applied in several federal court cases. Global Telemedia Int'l. v. Doe, 132 F. Supp.2d 1261 (C.D.Cal.2001); eCash Technologies v. Guagliardo, 127 F. Supp.2d 1069, 1083-1084 (C.D.Cal. 2000); cf. Blumenthal v. Drudge, 2001 WL 587860 (D.D.C) (denying SLAPP motion as untimely).
California law protects against use of the courts to discourage free speech. Lawsuits that have this intended effect are known as SLAPP suits.
In 1992, the California legislature recognized that there was a "disturbing increase in lawsuits brought primarily to chill the valid exercise of the constitutional rights of freedom of speech and petition," and found a strong public interest encouraging "continued participation in matters of public significance." California Code of Civil Procedure § 425.16(a). As one court explained:
To ensure that "this participation . . . not be chilled through abuse of the judicial process," the legislature established a presumption against the maintenance of litigation arising from any act "in furtherance of the [defendant]'s right of petition or free speech under the United States or California Constitution in connection with a public issue." CCP § 425.16(b). Once a court determines that such an issue is involved, the cause of action "shall be subject to a special motion to strike, unless the court determines that the plaintiff has established that there is a probability that the plaintiff will prevail on the claim." Id. Courts have given special consideration to SLAPP cases and have noted that "the early termination of [such a] lawsuit is highly desirable . . . . The public has an interest in receiving information on issues of public importance even if the trustworthiness of the information is not absolutely certain." Baker v. Los Angeles Herald Examiner, 42 Cal.3d 254, 269 (1986).
Under section 425.16(e), the SLAPP statute protects:
The statute expressly provides that it "shall be construed broadly." CCP § 425.16(a). The SLAPP statute extends to all exercises of free speech rights pertaining to public issues. The California Supreme Court has specifically ruled that a statement can be protected by subdivisions (e)(3) and (e)(4) even if the issue is not pending before a public body. Briggs v. Eden Council for Hope & Opportunity, 19 Cal.4th 1106, 1117-1118, 1123 (1999).
The performance and commercial activities of substantial companies constitute "matters of public interest" for First Amendment purposes. Paradise Hills Associates v. Procel, 235 Cal.App.3d 1528, 1544-1545 (1991). As such, the public enjoys broad, but not unlimited, latitude to discuss and present opinions regarding these topics. Morningstar, Inc. v. Superior Court, 23 Cal.App.4th 676, 695 (1994); Macias v. Hartwell, 55 Cal.App.4th 669, 672-73, (1997) (SLAPP statute applies to leaflet in intra-union election); Sipple v. Foundation for National Progress, 71 Cal.App.4th 226, 238 (1999); see also Wilcox v. Superior Court, supra, 27 Cal.App.4th at p. 822, fn.6 (in defamation suit over advocacy of economic boycott by competing organization, § 425.16 deemed applicable to "commercial speech"); Church of Scientology v. Wollersheim, 42 Cal.App.4th 628, 650 (1996) (statute's phrase "matters of public interest" "include[s] activities that involve private persons and entities, especially when a large, powerful organization may impact the lives of many individuals").
Each of these three prongs of the SLAPP statute applies to this case, and even one prong is sufficient to protect the defendant. Bosley has been the subject of litigation in California and of numerous proceedings by state medical boards, many of them leading to very serious discipline; even today, its practices are being investigated by North Carolina's Medical Board among others. Kremer Affidavit ¶ 11. Much of Kremer's web site is devoted to Bosley's disciplinary situation, including the matters that are now under investigation. Moreover, because Bosley is a huge medical marketing and treatment organization, one that touts itself as the leading authority in the world; it has offices across the nation, and claims to have treated hundreds of thousands of men and women for hair loss. And the question of whether hair loss treatments consist largely of charlatanism, and whether outfits like Bosley prey on the insecurities of aging men and women to lure them into painful and expensive medical procedures, has been the subject of numerous press reports by a variety of respected media organizations, not to speak of numerous news groups and chat rooms on the Internet frequented by prospective or disappointed customers alike. In short, the suit against Kremer is aimed at his speech on issues of public concern, and hence falls within the scope of the SLAPP statute.(16)
Once the Court agrees that Kremer is being sued over the exercise of his right of free speech, Bosley's complaint against him must be dismissed because Bosley cannot demonstrate a probability of success on the merits. First, under California law, the threshold question in a case of alleged defamation is whether the publication "impl[ies] an assertion of objective fact." Unelko Corp. v. Rooney, 912 F.2d 1049, 1053 (9th Cir. 1990), quoting Milkovich v. Lorain Journal Co., 497 U.S. 1 (1990):
In this case, much of the web sites over which Bosley is suing contains figurative and hyperbolic language the earmarks of nonactionable speech. See Morningstar, Inc. v. Superior Court, supra, 23 Cal.App.4th at 676, 696-697; Unelko Corp v. Rooney, supra, 912 F.2d at 1053. Words like "fraud" and "unethical" and "misrepresentation" are simply not susceptible of factual definition in such a way as to be proved true or false. For example, a lay person considering the fact that Bosley's medical license stands in a suspended or probationary status in some twenty different states, or that it has been the subject of repeated disciplinary proceedings in its home state of California, would be justified in forming the opinion that Bosley is "unethical." Moreover, Bosley admitted the propriety of his being disciplined for "immoral or unprofessional conduct" and for making "wilful misrepresentation in treatment." Kremer Affidavit, Exhibit H (Maryland Order), at 13. And Bosley's president was quoted in one of the news articles attached to Kremer's affidavit as dismissing the criticisms leveled against it on NBC Dateline on the ground that the charges of abuse were simply matters of "opinion." Id., Exhibit K, at 7.
To the extent that some of the statements relate to matters of fact, however, they are amply supported by the numerous law enforcement investigations, media reports, web site materials, and newsgroup and discussion group materials that Kremer cites and attached to his affidavit. Many of those charges were expressly accepted by Bosley as a factual matter in settling disciplinary charges, and thus must be deemed true. For example, the California decision, as cited in the Maryland Board's decision as ¶¶ 22, 53, 55 and 59, Exhibit H found Bosley guilty of misrepresentation and using false and misleading statements; ¶¶ 49 and 59 found Bosley guilty of altering and destroying patient records. These are all findings in which Bosley has acquiesced. Exhibit H, pages 15-16. Similarly, the Maryland consent order uses the phrase "extreme departure from the code of ethics" in paragraphs 29, 54, 56, 62, and 64. Moreover, in an interview that a former Bosley patient posted to the web at http://www.thebaldman. com/bosley.htm, question 4, two different Bosley employees admitted that their company had used altered photographs, although one blamed errant subordinates, and another blamed a bad advertising company for the error. Moreover, both the California investigation, and various media reports such as Dateline and US News and World Report, cited examples in which non-medical personnel had performed surgical procedures. Similarly, among the grounds for the Maryland Board's order, at page 13, was that Bosley "practices medicine with an unauthorized person or aids an unauthorized person in the practice of medicine."(17)
Moreover, because Bosley is a public figure, it must prove actual malice by the standard of clear and convincing evidence in order to succeed in this matter. Masson v. New Yorker Magazine, 501 U.S. 496, 510 (1991). This evidentiary standard, in turn, creates a prism through which a motion for summary adjudication must be viewed. Anderson v. Liberty Lobby, 477 U.S. 242, 266 (1986). And, in any event, because Kremer had never heard until the filing of this complaint that Bosley was challenging the factual accuracy of such allegations, he was entitled to rely on those investigative and media reports as a basis for preparing the statements on his web site. Thus, Bosley has no probability of success on the merits, and this case must be dismissed.
Finally, under California law, a libel plaintiff does not have a cause of action unless it can prove damages, and so, in order to prevail on an anti-SLAPP motion, Bosley is required to produce evidence that it has, in fact, been damaged by the publication in question. Global Telemedia Int'l v. Doe, 132 F. Supp.2d 1261, 1266, 1270 (C.D. Cal. 2001). Although Kremer's criticisms are certainly direct, the Court should not presume damages in light of the fact that Bosley has such a vast annual vast advertising budget, compared to the limited nature of Kremer's web site. Moreover, Bosley must show that Kremer's publication caused actual damage even though it comes after the very extensive previous publication of the very same allegations by well known media companies and law enforcement agencies. Indeed, although Bosley's complaint claims on page 22 that it has suffered six million dollars in compensatory damages, on pages 12 and 13 of the very same complaint Bosley alleges that it is impossible to quantify damages or to know how many potential patients and employees were lost because they saw Kremer's web site. For this reason as well, Bosley cannot show a reasonable probability of success, the complaint should be stricken.
In addition, when a defendant prevails on a California SLAPP motion, an award of attorney fees in favor of the defendant is mandatory under California law. Cal. Code of Civil Procedure § 425.16(c); Ketchum v. Moses, 24 Cal.4th 1122, 104 Cal. Rptr.2d 377 (2001). Accordingly, fees should be awarded in this case.
The motions to dismiss and to strike should be granted, and defendant should be awarded his attorney fees.
Paul Alan Levy
Attorneys for Defendant Kremer
August 21, 2001
1. 1 In this regard, Bosley Medical Group, S.C., not being the "registrant" of the trademark Bosley Medical, lacks standing to sue for infringement. Finance Inv. Co. (Bermuda) v. Geberit AG, 165 F.3d 526, 531 (7th Cir. 1998). Similarly, because it is not the "owner" of the trademark, it lacks standing to sue for dilution or cybersquatting.
2. On a motion to dismiss for lack of personal jurisdiction, the Court is not limited to considering the face of the complaint; defendant's evidence may also be considered. Turnock v. Cope, 816 F.2d 332, 333 (7th Cir. 1987). Plaintiff has the burden of proof on this motion. Steel Warehouse of Wisconsin v. Leach, 154 F.3d 712, 714 (7th Cir. 1998).
3. 3 See, e.g., Cybersell v. Cybersell, 130 F.3d 414, 419 (9th Cir. 1997) (Florida corporation's use of Arizona corporation's mark on web site did not support exercise of personal jurisdiction); Bensusan Rest. Corp. v. King, 937 F. Supp. 295 (S.D.N.Y. 1996), aff'd, 126 F.3d 25, 29 (2d Cir. 1997) (establishment of web site accessible to New York residents was insufficient to confer specific jurisdiction arising from use of trademark in web site); Oasis Corp. v. Judd, 132 F. Supp.2d 612, 623 (S.D. Ohio 2001) (fact that plaintiff was based in Ohio did not support personal jurisdiction of trademark and libel claims against operator of non-commercial gripe site from Ohio, even though site was sufficiently interactive to permit viewers to generate automatic letters in support of defendant to the media and to the plaintiff); Search Force v. Dataforce Int'l, 112 F. Supp.2d 771, 778 (S.D. Ind. 2000) ("recent district court cases . . . reinforce the notion that a defendant must avail itself of the forum state in a manner that is somewhat more purposeful than an allegedly infringing domain name or use of an allegedly infringing mark on an interactive web site"); Coastal Video Comms. Corp. v. Staywell Corp., No. 2:99:cv198, 1999 U.S. Dist. LEXIS 11827, at *26 (E.D. Va. Aug. 2, 1999) ( interactive web site alone did not confer personal jurisdiction); Nicosia v. De Rooy, No. C98-3029, 1999 U.S. Dist. LEXIS 17451, at *8-9 (N.D. Cal. July 7, 1999) (mere creation of a web site accessible by forum residents does not amount to purposeful availment); Patriot Sys., v. C-Cubed Corp., 21 F. Supp. 2d 1318, 1324 (D. Utah 1998) (no jurisdiction over company based merely on passive web site that provided information to those interested in it); Edberg v. Neogen Corp., 17 F. Supp. 2d 104, 113-115 (D. Conn. 1998) (no jurisdiction for web site which provided no way to order items advertised thereon); Santana Prods. v. Bobrick Washroom Equip., 14 F. Supp. 2d 710, 714 (M.D. Pa. 1998) (jurisdiction insufficient based on web site through which no business was transacted); Blackburn v. Walker Oriental Rug Galleries, 999 F. Supp. 636, 639 (E.D. Pa. 1998) (contacts insufficient to support jurisdiction when web site in question provided the ability to receive e-mail messages from viewers but was otherwise passive); Mallinckrodt Med. v. Sonus Pharms., 989 F. Supp. 265, 272-273 (D.D.C. 1998) (no jurisdiction based merely on posting of allegedly defamatory statements on America On Line). Cf. Carver v. H.R. Plus, 992 F. Supp. 1293, 1295 (D. Utah 1998) (no personal jurisdiction based simply on computer access to forum state).
4. 4 In recent cases, for example, France and Germany have sought to bar leading internet companies from allowing sites accessible in their countries from mentioning Nazi's or carrying Nazi paraphernalia, which are beyond the bounds of free speech protection in those countries. Other countries, such as China and Cuba, have undertaken efforts to purge the internet of any dissenting opinions. If jurisdiction is allowed anywhere that a web site is accessible, the chilling effects on free Internet speech will become even more serious.
5. 5The Eastern District of Virginia is the leading authority on in rem jurisdiction because Network Solutions, which is located in the Virginia suburbs of Washington, D.C., is the main registrar for domain names ending in .com and .org. In that regard, we note the very recent decision in Fleetboston v. Fleetbostonfinancial.com, 138 F. Supp.2d 121 (D. Mass. 2001), which suggests that the mere fact that Tucows does business in this district is not a sufficient basis for exercising in rem jurisdiction over it. Accord, Mattel v. Barbie-Club.com, 2001 WL 436207 (S.D.N.Y.).
6. 6Shelley v. Kraemer, 334 U.S. 1, 14-15 (1948); Organization for a Better Austin v. Keefe, 402 U.S. 415, 418 (1971); see also Procter & Gamble Co. v. Bankers Trust Co., 78 F.3d 219, 224-225 (6th Cir. 1996).
7. 7 E.g., Semco v. Amcast, 52 F.3d 108, 111-114 (6th Cir. 1995); Porous Media Corp. v. Pall Corp., 173 F.3d 1109, 1119-1121 (8th Cir. 1999); U.S. Healthcare v. Blue Cross of Greater Philadelphia, 898 F.2d 914, 927-939 (3d Cir. 1990); Mattel v. MCA Records, 28 F. Supp. 2d 1120, 1144-1145 (C.D. Cal. 1998).
8. 8E.g., Bad Frog Brewery v. New York State Liquor Authority, 134 F.3d 87, 94-97 (2d Cir. 1998); ACLU of Georgia v. Miller, 977 F. Supp. 1228, 1233 (N.D. Ga. 1997).
9. 9E.g., Twin Peaks Production v. Publications Int'l, 996 F.2d 1366, 1379 (2d Cir. 1993); Rogers v. Grimaldi, 875 F.2d 994, 999 (2d Cir. 1989).
10. 10Bally Total Fitness Holding Corp. v. Faber, 29 F. Supp. 2d 1161, 1165 (C.D. Cal. 1998) (upholding use of Bally trademark in both web site and site's internet address); see also Playboy Enterprises v. Netscape Communications, 55 F. Supp. 2d 1070, 1083 (C.D. Cal. 1999) (citing "First Amendment interests at stake" where defendants used plaintiffs' trademarks in machine-readable code to decide which advertisements to show users of search engine who included word "playboy" in a search for sites), aff'd 202 F.3d 278 (9th Cir. 1999); Playboy Enterprises v. Welles, 7 F. Supp. 2d 1098, 1103 (S.D. Cal. 1998) (upholding right of former "Playmate" to use Playboy trademarks in meta tags for her self-promotional commercial web site, with no mention of First Amendment).
11. E.g., Name.Space v. Network Solutions, 202 F.3d 573, 585-587 (2d Cir. 2000). Even if the only purpose of a domain name were to show the sponsor, and not the topic, of a web page, the proposition that the use of particular words is not speech if their only purpose is to denote the source of the speech is fallacious. There are numerous cases in which courts have held, for example, that signs or billboards indicating the presence of a particular vendor are speech protected by the First Amendment. E.g., Metromedia v. San Diego, 453 U.S. 490 (1981); Wheeler v. Commissioner of Highways, 822 F.2d 586 (6th Cir. 1987). See also Asian American Business Group v. City of Pomona, 716 F.Supp. 1328 (C.D. Cal. 1989) (striking down ordinance regulating signs identifying businesses in foreign language). Similarly, there are many cases where the desire of a professional or other business person to use a particular name for its operation has been treated as a First Amendment issue, although in some such cases the First Amendment rights have been overcome by other government interests. E.g., Friedman v. Rogers, 440 U.S. 1 (1979). In any event, domain names may characterize the subject as well as the sponsor of the web site. Kremer Affidavit ¶ 14.
12. 12E.g., Cardtoons v. Major League Baseball Players Ass'n, 95 F.3d 959, 968-970 (10th Cir. 1996); Rogers v. Grimaldi, 875 F.2d 994, 997-999 (2d Cir. 1989); Mutual of Omaha Ins. Co. v. Novak, 836 F.2d 397, 402-403 (8th Cir. 1987).
13. 13L.L. Bean v. Drake Publishers, 811 F.2d 26, 33 (1st Cir. 1987); ACLU of Georgia v. Miller, 977 F. Supp. 1228, 1233 (N.D. Ga. 1997); Bally Total Fitness Holding Corp. v. Faber, 29 F. Supp. 1161, 1167 (C.D. Cal. 1998); Lighthawk v. Robertson, 812 F. Supp. 1095, 1097-1101 (W.D. Wash. 1993); Stop the Olympic Prison v. United States Olympic Comm., 489 F. Supp. 1112, 1124-1125 (S.D.N.Y. 1980); see also Lucasfilm v. High Frontier, 622 F. Supp. 931 (D.D.C. 1985) (ruling on nonconstitutional grounds).
14. 14Because this pleading requirement is a matter of federal procedural law, it is not affected by the question raised in Part III(B)(1) of this memorandum concerning which state's law applies. Asay v. Hallmark Cards, 594 F.2d 692, 699 (8th Cir. 1979).
15. 15 The "of and concerning" requirement is the same in both Illinois and California. Vanatassell-Matin v. Nelson, 741 F. Supp. 698, 708 (N.D. Ill. 1990).
16. The timing of the complaint in this case also implicates the first prong of section 425.16(e), which forbids lawsuits that are filed over a person's participation in government proceedings, inasmuch as the suit was filed shortly after the North Carolina Medical Board acknowledged Bosley's complaint about its office in that state, and advised him that it would begin an investigation.
17. A search of Kremer's web site for the word "fraud," alleged by the complaint to be one of the libelous statements, found only the phrase "misleading and fraudulent advertising" which appears in point 10 of bosleymedicalviolations.com, citing a page of Bosley's own site which warns against the advertising of other companies.