Xcentric Ventures LLC v. Mediolex Limited et al

Filing 1

COMPLAINT. Filing fee received: $350.00, receipt number PHX 0970-6300413, filed by Xcentric Ventures LLC (submitted by Maria Speth). (Attachments: # 1 Exhibit, # 2 Civil Cover Sheet)(REK)

1 2 3 4 5 6 7 8 9 Maria Crimi Speth (012574) JABURG & WILK, P.C. 3200 N. Central Avenue, Suite 2000 Phoenix, Arizona 85012 mcs@jaburgwilk.com (602) 248-1000 David S. Gingras, #021097 Gingras Law Office, PLLC 3941 E. Chandler Blvd., #106-243 Phoenix, AZ 85048 Tel.: (480) 668-3623 Fax: (480) 248-3196 David@GingrasLaw.com Attorneys for Plaintiff 10 11 UNITED STATES DISTRICT COURT 12 DISTRICT OF ARIZONA Jaburg & Wilk, P.C. Attorneys At Law 3200 N. Central Avenue, Suite 2000 Phoenix, Arizona 85012 (602) 248-1000 13 XCENTRIC VENTURES, L.L.C., Case No. 14 Plaintiff, 15 v. 16 17 18 COMPLAINT MEDIOLEX LTD., a foreign corporation d/b/a/ COMPLAINTSBOARD.COM; COMPLAINTSBOARD.COM, an unregistered business entity; MARK SCHULTZ, an individual, 19 Defendants. 20 21 22 23 24 25 26 For its Complaint, Plaintiff Xcentric Ventures, L.L.C. alleges as follows: 1. This is a civil action seeking monetary damages and injunctive relief for various acts of copyright infringement under the copyright laws of the United States (17 U.S.C. § 101 et seq.) and for various acts of trademark infringement in violation of the Lanham Act, 15 U.S.C. § 1051, et seq., and related state law claims. 2. This Court has jurisdiction under 15 U.S.C. § 1121 (trademark); 17 U.S.C. § 101 et seq. (copyright); 28 U.S.C. § 1331 (federal question); and 28 U.S.C. § 1338(a) 27 28 10297-44/MCS/DAG/951598_v1 1 (copyright). This Court has supplemental jurisdiction over state and common law claims 2 pursuant to 28 U.S.C. § 1367(a). 3 3. Venue in this District is proper under 28 U.S.C. §§ 1391(b) and (c), and/or 4 28 U.S.C. § 1400(a). 5 occurred in this District, and certain corporate defendants are subject to personal 6 jurisdiction in this District. 7 4. A substantial part of the acts of infringement complained of Personal jurisdiction in this District is proper because each defendant, 8 engaged in acts of copyright infringement within the District of Arizona, and/or 9 intentionally directed tortious conduct at Plaintiff knowing such conduct would cause 10 11 12 Jaburg & Wilk, P.C. Attorneys At Law 3200 N. Central Avenue, Suite 2000 Phoenix, Arizona 85012 (602) 248-1000 13 14 15 16 17 18 19 20 harm within this District. 5. Plaintiff XCENTRIC VENTURES, L.L.C. (“Plaintiff”) is an Arizona limited liability company with its principal place of business in Tempe, Arizona and is a citizen of the State of Arizona. 6. Plaintiff is the operator of the website located at www.RipoffReport.com (the “Ripoff Report”). The Ripoff Report is widely used by consumers, and works closely with government agencies, attorneys general, federal, state, and local law enforcement, and the news media to help report, identify and prevent consumer fraud and similar conduct. 7. Defendant MEDIOLEX LTD d/b/a COMPLAINTSBOARD.COM (“Mediolex”) is a corporation of unknown origin which has registered the domain name www.complaintsboard.com, and which caused the events herein described to occur with 21 knowledge that they would cause harm within the State of Arizona. Upon information 22 and belief, Mediolex also has engaged in continuous, systematic and substantial contacts 23 with the State of Arizona sufficient to confer general and specific personal jurisdiction 24 over it in this District. 25 8. Defendant COMPLAINTSBOARD.COM is an entity of unknown origin 26 which the website WWW.COMPLAINTSBOARD.COM claims to be operated by, and 27 which caused the events herein described to occur with knowledge that they would cause 28 harm within the State of Arizona. Upon information and belief, complaintsboard.com 2 10297-44/MCS/DAG/951598_v1 1 also has engaged in continuous, systematic and substantial contacts with the State of 2 Arizona sufficient to confer general and specific personal jurisdiction over it in this 3 District. 4 9. Upon information and belief, Defendant MARK SCHULTZ is a resident of 5 the country of Latvia, and claims to be a “part owner” of the website 6 COMPLAINTSBOARD.COM, and caused the events herein described to occur with 7 knowledge that they would cause harm within the State of Arizona. Upon information 8 and belief, Mr. Schultz also has engaged in continuous, systematic and substantial 9 contacts with the State of Arizona sufficient to confer general and specific personal 10 jurisdiction over it in this District. 11 GENERAL ALLEGATIONS 12 Jaburg & Wilk, P.C. Attorneys At Law 3200 N. Central Avenue, Suite 2000 Phoenix, Arizona 85012 (602) 248-1000 13 14 15 16 17 18 19 20 21 10. The Ripoff Report is, among other things, a website upon which consumers may post complaints. Any member of the public with access to a computer and an Internet connection may use the Ripoff Report website to create and publish complaints about companies or individuals who they believe have wronged them in some manner. 11. The Ripoff Report was launched in 1998 and was the only website that provided consumers with a forum to post complaints about companies 12. When a user posts a complaint on Ripoff Report, the user electronically signs an agreement that grants to Xcentric an irrevocable, perpetual exclusive license to use, copy, perform, display and distribute the content posted. 13. Complaints published on the Ripoff Report are automatically indexed by 22 numerous search engines such as Google and such complaints often rank very high in 23 Google’s search results. 24 25 26 14. Plaintiff is the owner of various copyrights relating to content appearing on the Ripoff Report website. 15. Plaintiff is the owner of the federal copyright issued by the United States 27 Copyright Office Certificate of Registration No. TXu1-574-438 entitled “Rip-off Report 28 Content” dated March 25, 2008. 3 10297-44/MCS/DAG/951598_v1 1 16. Plaintiff is the owner of a federal copyright issued by the United States 2 Copyright Office Certificate of Registration No. TXu1-371-920 entitled “Group Database 3 Registration for Automated Database Entitled ‘Rip-off Report Database.’ Unpublished 4 updates from March 5, 2008 – May 5, 2008” dated May 20, 2008. 5 6 7 17. Plaintiff is the owner of the registered trademark RIPOFF REPORT, United States Patent & Trademark Office Registration Number 2958949. 18. Plaintiff is the owner of the pending trademark registration for 8 CORPORATE ADVOCACY PROGRAM, United States Patent & Trademark Office 9 Serial Number 85460244. 10 11 12 Jaburg & Wilk, P.C. Attorneys At Law 3200 N. Central Avenue, Suite 2000 Phoenix, Arizona 85012 (602) 248-1000 13 14 15 16 17 18 19 20 19. Plaintiff is the owner of the registered trademark DON’T LET THEM GET AWAY WITH IT, United States Patent & Trademark Office Registration Number 2824390. 20. Plaintiff is the owner of the common law trademark DON’T LET THEM GET AWAY WITH IT, LET THE TRUTH BE KNOWN. 21. On or about December 13, 2006, June 23, 2007, August 18, 2007, September 1, 2007, September 5, 2007, October 1, 2007, October 5, 2007, October 9, 2007, October 26, 2007 and November 1, 2007, Plaintiff filed fictitious report on its own website about a fictitious business called Leanne’s Mobile Groom and Board in Fort Smith, Arkansas (the “Leanne’s Posting”). The Leanne’s Posting was made for the purpose of tracking activities of competitors and other businesses with an unlawful intent. There never is and never was a real business called Leanne’s Mobile Groom and Board. 21 22 23 DEFENDANTS’ ACTIVITIES 22. On or about June 22, 2006 Defendants or their predecessor purchased the 24 domain name complaintsboard.com and shortly thereafter launched a website located at 25 complaintsboard.com. 26 27 23. The complaintsboard.com website was launched by copying large amounts of content from the Ripoff Report website. 28 4 10297-44/MCS/DAG/951598_v1 1 24. The website www.complaintsboard.com (the “ComplaintsBoard site”) 2 generally purports to be a forum for consumers to post and review complaints about 3 businesses and bad business practices, among other things. 4 5 6 25. The ComplaintsBoard site copied the concept, style, and the content of the Ripoff Report site. 26. On or around December 17, 2008, Plaintiff initiated a lawsuit in this Court 7 similar to the present one against COMPLAINTSBOARD.COM for copyright 8 infringement. The case was captioned Xcentric Ventures, LLC v. Elizabeth Arden, Case 9 No. 2:08-cv-02299-HRH (the “2008 Case”). 10 11 12 Jaburg & Wilk, P.C. Attorneys At Law 3200 N. Central Avenue, Suite 2000 Phoenix, Arizona 85012 (602) 248-1000 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 27. In the 2008 Case, the defendants were found to have systematically stolen copyright-protected content from the Ripoff Report website and published it on the Complaintsboard.com website for the benefit of Defendants. On October 22, 2009, the Court entered Judgment against defendants in the 2008 Case, awarding both monetary damages arising from defendant’s infringement of Plaintiff’s copyright, as well as a permanent injunction. See Judgment, attached hereto as Exhibit “A”. 28. Plaintiff has taken numerous affirmative steps to ensure that the Complaintsboard.com website comply with the Permanent Injunction and cease any further copying from the Ripoff Report website. 29. Since the judgment was entered in the 2008 Case, Defendants have continued engaging in conduct that violates Plaintiff’s rights. 30. Defendants permit user-generated content to be posted on the Complaintsboard.com website. 31. In many cases, the user-generated content is content that has been exclusively licensed to Xcentric Ventures, LLC. 32. When consumers post content on Ripoff Report, they enter into an exclusive license with Xcentric prohibiting them from posting the same content on other websites. 33. Defendants encourage and permit consumers to post content that has been exclusively licensed to Xcentric. 28 5 10297-44/MCS/DAG/951598_v1 1 2 3 34. Despite knowledge and demand, Defendants continue to permit the posting of content that is exclusively licensed to Xcentric. 35. In addition, Defendants have used Xcentric’s trademarks on the 4 Complaintsboard.com website which has caused and is likely to cause consumer 5 confusion. 6 36. 7 8 9 10 11 12 Jaburg & Wilk, P.C. Attorneys At Law 3200 N. Central Avenue, Suite 2000 Phoenix, Arizona 85012 (602) 248-1000 13 14 15 16 17 18 19 20 Defendants display the trademark RIPOFF REPORT on the Complaintsboard.com website. 37. Defendants display the trademark “DON’T LET THEM GET AWAY WITH IT” on the Complaintsboard.com website. 38. Defendants display the trademark CORPORATE ADVOCACY PROGRAM on the Complaintsboard.com website. 39. The ComplaintsBoard site’s use of Xcentric’s trademarks is likely to cause confusion as to source or sponsorship. 40. Defendants’ unlawful use of Plaintiff’s trademarks has caused substantial actual confusion among consumers who have been misled into believing that Plaintiff is the owner and/or operator of the ComplaintsBoard site when, in fact, this is not true. 41. As a result of the ongoing and pervasive copying of Xcentric’s copyright protected materials and as a result of the ongoing use of Xcentric’s trademark on to the ComplaintsBoard site by Defendants, the web traffic to the Ripoff Report website has been greatly reduced. 42. Sometime prior to January 19, 2011, Defendants posted the following 21 statement on Complaintsboard.com: “Leanne's Mobile Groom And Board Are you also a 22 victim of the Leanne's Mobile Groom And Board? Submit a complaint to help other 23 consumers to be educated and don't let them get away with it!” 24 43. Defendants also posted the following statement on Complaintsboard.com: 25 “In case you have experienced any problems with Leanne’s Mobile Groom and Board 26 please report immediately by filling [sic] a Complaint Form.” 27 28 6 10297-44/MCS/DAG/951598_v1 1 44. Defendants posted the solicitations of complaints about Leanne’s Mobile 2 Groom and Board for the sole reason of diverting traffic from the Ripoff Report website 3 to the Complaintsboard.com website. 4 5 COUNT ONE 6 (Infringement of Copyright – 17 U.S.C. §§ 106.501(a)) 7 8 9 10 11 12 Jaburg & Wilk, P.C. Attorneys At Law 3200 N. Central Avenue, Suite 2000 Phoenix, Arizona 85012 (602) 248-1000 13 14 15 16 17 18 19 20 21 45. Plaintiff incorporates herein by this reference each and every allegation set forth in this Complaint as though fully set forth below. 46. Defendants have violated Plaintiff’s exclusive rights under 17 U.S.C. § 106(3) (distribution) by distributing Plaintiff’s works without permission 47. Defendants have violated Plaintiff’s rights under 17 U.S.C. § 106(5) (display) by publicly displaying Plaintiff’s works without permission. 48. Plaintiff is informed and believes that the foregoing acts of infringement have been willful, intentional, and in disregard of and with indifference to the rights of Plaintiff. 49. Defendants’ infringing activities were not authorized by Plaintiff and were performed without Plaintiff’s knowledge, consent, or permission. 50. Defendants’ infringing activities were and are done for Defendants’ financial gain. 51. Defendants’ infringing activities have caused Plaintiff to incur actual damages of not less than $150,000. 52. As the result of Defendants’ infringement of Plaintiff’s exclusive rights, 22 Plaintiff is entitled to recover from Defendants its actual damages pursuant to 17 U.S.C. § 23 504(b) or statutory damages pursuant to 17 U.S.C. § 504(c), whichever is greater. 24 25 26 53. As the result of Defendants’ infringement of Plaintiff’s exclusive rights, Plaintiff further is entitled to attorneys’ fees and costs pursuant to 17 U.S.C. § 505. 54. Furthermore, the conduct of each Defendant is causing and, unless enjoined 27 and restrained by this Court, will continue to cause Plaintiff great and irreparable injury 28 that cannot fully be compensated or measured in money. 7 10297-44/MCS/DAG/951598_v1 1 55. Plaintiff has no adequate remedy at law. 2 56. Pursuant to 17 U.S.C. §§ 502(a) and 503, Plaintiff is entitled to preliminary 3 and permanent injunctive relief prohibiting each Defendant from further infringing 4 Plaintiff’s copyrighted works. 5 6 COUNT TWO 7 (Contributory Infringement of Copyright) 8 9 10 57. Plaintiff incorporates herein by this reference each and every allegation set forth in this Complaint as though fully set forth below. 58. As set forth more fully herein, Defendants, with knowledge of the infringing activity, induced, caused or materially contributed to copyright violations by third parties 12 who posted content exclusively licensed to Plaintiff on the Complaintsboards.com 13 Jaburg & Wilk, P.C. Attorneys At Law 3200 N. Central Avenue, Suite 2000 Phoenix, Arizona 85012 (602) 248-1000 11 website. 14 15 59. As a direct and proximate cause of Defendants’ conduct, Plaintiff suffered harm and damages. 16 COUNT THREE 17 (Trademark Infringement 15 U.S.C. §§ 1125) 18 19 20 21 22 23 24 25 26 27 60. Plaintiff incorporates herein by this reference each and every allegation set forth in this Complaint as though fully set forth below. 61. Plaintiffs did not give Defendants consent to use its common law trademarks. 62. Defendants’ use of Plaintiff’s common law trademarks is likely to cause confusion or to deceive and has caused confusion as to the source or origin of the services. 63. Defendants’ use of Plaintiff’s common law trademarks implies sponsorship or affiliation between Plaintiff and Defendants. 64. Defendants’ use of Plaintiff’s common law trademarks is a misappropriation of the goodwill that Plaintiff has accumulated in its trademarks. 28 8 10297-44/MCS/DAG/951598_v1 1 2 3 4 5 6 7 65. Defendants have infringed upon Plaintiff’s common law trademarks through all of the acts previously alleged in this Complaint. 66. Plaintiff has suffered damages as a result of Defendants’ infringing activities in an amount to be proved at trial. 67. Plaintiff is entitled to injunctive relief to prohibit Defendant from committing any further or additional infringement. 68. Plaintiff is entitled to recover statutory damages and also general, special, 8 consequential, and incidental damages, including but not limited to lost profits and cost of 9 corrective advertising, and injunctive relief. 10 11 69. Defendants’ acts were committed in bad faith entitling Plaintiff to a recovery of treble damages and attorneys’ fees. 12 COUNT FOUR Jaburg & Wilk, P.C. Attorneys At Law 3200 N. Central Avenue, Suite 2000 Phoenix, Arizona 85012 (602) 248-1000 13 (Trademark Infringement 15 U.S.C. §§ 1114) 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 70. Plaintiff incorporates herein by this reference each and every allegation set forth in this Complaint as though fully set forth below. 71. Plaintiffs did not give Defendants consent to use its registered trademarks. 72. Defendants’ use of Plaintiff’s registered trademarks is likely to cause confusion or to deceive and has caused confusion as to the source or origin of the services. 73. Defendants’ use of Plaintiff’s registered trademarks implies sponsorship or affiliation between Plaintiff and Defendants. 74. Defendants’ use of Plaintiff’s registered trademarks is a misappropriation of the goodwill that Plaintiff has accumulated in its trademarks. 75. Defendants have infringed upon Plaintiff’s registered trademarks through all of the acts previously alleged in this Complaint. 76. Plaintiff has suffered damages as a result of Defendants’ infringing activities in an amount to be proved at trial. 77. Plaintiff is entitled to injunctive relief to prohibit Defendant from committing any further or additional infringement. 9 10297-44/MCS/DAG/951598_v1 78. 1 Plaintiff is entitled to recover statutory damages and also general, special, 2 consequential, and incidental damages, including but not limited to lost profits and cost of 3 corrective advertising, and injunctive relief. 79. 4 5 Defendants’ acts were committed in bad faith entitling Plaintiff to a recovery of treble damages and attorneys’ fees. 6 7 COUNT FIVE 8 (Unfair Competition) 80. 9 10 forth in all paragraphs as though fully set forth below. 81. 11 12 Jaburg & Wilk, P.C. Attorneys At Law 3200 N. Central Avenue, Suite 2000 Phoenix, Arizona 85012 (602) 248-1000 13 14 15 16 17 18 19 20 21 Plaintiff incorporates herein by this reference each and every allegation set The acts of Defendant amount to an unauthorized interference with the normal operation of Plaintiff’s business in order to divert a material portion of the profit, with special advantage to Defendant in the competition because of the fact that Defendant has avoided the time and expense of building its own content and generating its own traffic. 82. As a direct and proximate result of Defendants’ unfair competition, Plaintiff has suffered damages. 83. 41. Defendants’ unfair competition has caused, and continues to cause, Plaintiff to sustain irreparable damages, loss and injury, for which Plaintiff has no adequate remedy at law. 84. 42. Plaintiff is entitled to preliminary and permanent injunctive relief enjoining Defendants from further unfair competition with Plaintiff. 22 23 24 25 WHEREFORE, Plaintiff requests that judgment be entered in its favor and against each Defendant as follows: 1. For Plaintiff’s actual damages and Defendants’ profits, or statutory 26 damages, as Plaintiff may elect, for infringement of each copyrighted work pursuant to 17 27 U.S.C. § 504; 28 10 10297-44/MCS/DAG/951598_v1 1 2 3 4 5 2. §1117; 3. 4. For Plaintiff’s costs in this action pursuant to 17 U.S.C. § 504 and/or 15 U.S.C. § 1117(a); 5. For Plaintiff’s reasonable attorneys’ fees incurred pursuant to 17 U.S.C. § 504 and 15 U.S.C. §1117; and 8 9 For injunctive relief pursuant to 17 U.S.C. §§ 502(a) and 503 and 15 U.S.C. §1116; 6 7 For Plaintiff’s damages for trademark infringement pursuant to 15 U.S.C. 6. For such other and further relief as the Court may deem just and proper. 10 11 DATED this 20th day of January, 2012. 12 JABURG & WILK, P.C. Jaburg & Wilk, P.C. Attorneys At Law 3200 N. Central Avenue, Suite 2000 Phoenix, Arizona 85012 (602) 248-1000 13 14 s/Maria Crimi Speth Maria Crimi Speth Attorneys for Plaintiff 15 16 17 18 19 20 21 22 23 24 25 26 27 28 11 10297-44/MCS/DAG/951598_v1