Devil's Advocate, LLC v. Zurich American Insurance Co

Filing

UNPUBLISHED PER CURIAM OPINION filed. Originating case number: 1:13-cv-01246-TSE-TRJ Copies to all parties and the district court/agency. [999973075].. [15-1048]

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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

No. 15-1048

DEVIL’S ADVOCATE, LLC; JOHN W. TOOTHMAN,
Plaintiffs - Appellants,
v.
ZURICH AMERICAN INSURANCE COMPANY,
Defendant - Appellee.

Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria.
T. S. Ellis, III, Senior
District Judge. (1:13-cv-01246-TSE-TRJ)

Argued:

September 21, 2016

Decided:

November 22, 2016

Before WILKINSON and FLOYD, Circuit Judges, and Irene M. KEELEY,
United States District Judge for the Northern District of West
Virginia, sitting by designation.

Affirmed by unpublished per curiam opinion.

ARGUED: John William Toothman, Great Falls, Virginia, for
Appellants.
Kelly Marie Lippincott, CARR MALONEY P.C.,
Washington, D.C., for Appellee.
ON BRIEF: Sarah W. Conkright,
CARR MALONEY P.C., Washington, D.C., for Appellee.

Unpublished opinions are not binding precedent in this circuit.

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PER CURIAM:
Devil’s Advocate, LLC, and John W. Toothman (“Appellants”)
sued Zurich American Insurance Company (“Zurich”) for breach of
contract,

unjust

enrichment,

conversion,

unauthorized

use

of

name, trademark infringement, and copyright infringement. After
the district court dismissed all of their claims, Appellants
timely appealed. 1 Finding no error, we affirm the judgment of the
district court.
I.
Appellant John W. Toothman is a lawyer and the founder of
Devil’s

Advocate,

a

consulting

firm

that

provides

expert

testimony regarding the reasonableness of legal fees. In 2008,
Appellee Zurich became embroiled in a coverage dispute in state
court in Harris County, Texas (the “Texas litigation”). 2

On

October 12, 2010, Blair Dancy, a lawyer representing Zurich in
the Texas litigation, contacted Toothman about serving as an
expert witness regarding the reasonableness of the attorneys’

1

The district court’s orders, the hearing transcripts, and
the docket do not indicate whether it dismissed the claims with
prejudice. For our purposes, we assume that the district court
dismissed those claims with prejudice and affirm as such.
2

See Sterling Chemicals, Inc. v. Zurich American Insurance
Co., et al., Cause No. 2008-09808 (234th Jud. Dist. Ct., Harris
Cty., Tex.)
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fees billed by defense counsel in the case. Toothman responded
by email, indicating his availability and attaching a copy of a
blank form billing agreement (“Billing Agreement”), his resume,
and

additional

information

about

Devil’s

Advocate’s

services.

The Billing Agreement included no fee terms, leaving several
blank spaces where the parties could later insert such terms
should they reach an agreement. Neither Dancy nor anyone else
representing Zurich signed the Billing Agreement.
Less than a month later, on November 2, 2010, Dancy asked
Appellants to provide a proposal for services to include review
of billing records and other pertinent information relevant to
the disputed defense fees, as well as providing potential trial
testimony.
(“Proposal”),

Toothman
which

responded
stated:

with

“Assuming

an
we

email

review

at

proposal
least

$4

million in bills (fees and expenses) and the bill formats are
consistent with the sample bill you provided, we are quoting a
fee for your project of 2.1% of the gross amount of the fees we
would review and report upon.” J.A. 314.

Further, it made plain

that “[t]his proposal is preliminary, prior to our engagement
and full review of available information.” J.A. 315. Toothman
did not include a completed Billing Agreement with his email.
Toothman contacted Dancy two days later to determine if he
had received the Proposal. After confirming that he had, Dancy
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informed Toothman that “[t]he client’s mulling it over.” J.A.
322. Toothman followed up four days later, on November 8, 2010,
with an email inquiring whether there had been “[a]ny word yet
from Zurich” regarding the Proposal. J.A. 294-95; J.A. 322.
No later than November 19, 2010, Dancy informed Toothman by
telephone that Zurich would not accept the Proposal because the
parties still
services.

needed

Dancy

also

to

negotiate

notified

the

price

Toothman

of

that,

the

proposed

because

the

deadline for designating experts had passed, Zurich needed leave
of court to designate him as an expert witness. Dancy explicitly
stated

that

such

designation

was

a

condition

precedent

to

Zurich’s acceptance of Toothman’s Proposal. Ultimately, although
Toothman continued to negotiate his fee with Dancy, the parties
never reached an agreement.
In an email update dated November 16, 2010, Dancy advised
Toothman that the court in Texas had postponed the trial and
pre-trial
impeded

conference

Zurich’s

in

ability

the
to

litigation,
amend

its

a

development

expert

that

designation

to

include Toothman. Toothman responded to this news on November
19, 2010: “Just checking in. I’m assuming this may be shut down
for some time, but the more time we can spend on the review, the
better.” J.A. 408-09. Also on the 19th, Dancy served opposing
counsel in the Texas litigation with Zurich’s proposed amended
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expert

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designation

naming

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Toothman.

Thereafter,

in

an

email

dated December 2, 2010, Toothman acknowledged that Zurich had
not yet hired him. J.A. 296; J.A. 410 (“I’ll be careful, if I
ever get hired.”).
The next day, Dancy filed an amended motion for a Rule 166 3
pretrial conference in the Texas litigation, seeking leave to
amend

Zurich’s

expert

designation

and

attaching

the

amended

designation naming Toothman.
Toothman was aware that Zurich needed court approval of his
late designation before it could accept Appellants’ Proposal. In
a December 8, 2010, email to Dancy, Toothman confirmed that,
although Zurich had provided his name to the court, he knew he
had

not

yet

been

retained

to

perform

any

work

under

the

Proposal.
On

December

13,

2010,

Toothman

again

emailed

Dancy,

advising him that “[i]n case this thing goes forward,” the total
amount of legal fees he had received for review was just under
$3.5

million,

a

difference

of

$500,000

from

the

$4

million

originally estimated in the Proposal. J.A. 297; J.A. 422. The
next

day,

he

acknowledged

to

Dancy

3

that

Zurich

had

neither

Rule 166 of the Texas Rules of Civil Procedure provides
that the Court may conduct pre-trial conferences to, among other
reasons, take up pending motions.
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accepted the Proposal nor retained him: “[I]s there any way to
make sure Zurich’s ready to go right after the hearing, e.g., by
approving our agreement and cutting the initial check?” J.A.
297; J.A. 428.
Finally,

on

December

29,

2010,

Toothman

sent

Dancy

the

following email: “Attached is the paperwork to get this project
going once you decide what to do. . . . We would start as soon
as we received the signed agreement and initial payment.” J.A.
297; J.A. 430. Attached was a Billing Agreement listing a flat
fee of $69,233.82, based on 2.0% of the gross amount of fees and
expenses subject to review, estimated by Toothman to be at least
$3.4 million. This was the first Billing Agreement submitted by
Toothman that included a specific fee estimate. Also attached
was

an

invoice

one-half

of

totaling

the

$34,616.91,

estimate.

Dancy

purportedly

never

signed

representing
this

Billing

Agreement and denies ever agreeing to its terms.
On

January

13,

2011,

Toothman

emailed

Dancy,

claiming

“[payment of the full fee was triggered when Zurich designated
me

as

its

attached

an

expert

on

account

December
statement,

$69,233.82.

Dancy

called

discuss

email

and

the

3,

with

Toothman

invoices,

2010.”

on

but

two

J.A.

433.

invoices

January
Toothman

17,

He

also

totaling
2011,

terminated

to
the

call. Zurich then concluded that it could not work with Toothman
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and withdrew its request for leave to designate him as an expert
witness in the Texas litigation. It confirmed this to Toothman
in a letter dated January 17, 2011. J.A. 438-40.
Toothman and Devil’s Advocate responded by suing Zurich in
the Circuit Court for Fairfax County, Virginia in February 2011.
Several days prior to trial, however, they voluntarily dismissed
their claims pursuant to Virginia’s nonsuit statute. Later, on
October 7, 2013, they sued Zurich in the Eastern District of
Virginia,

alleging

enrichment,

claims

conversion,

of

breach

unauthorized

of

use

contract,

of

name,

unjust

trademark

infringement, and copyright infringement.
The
dismiss

district
the

court

complaint

granted

pursuant

in
to

part

Fed.

Zurich’s

R.

Civ.

motion

P.

to

12(b)(6),

dismissing Appellants’ claims for unjust enrichment, conversion
(except as to Toothman’s name and reputation), unauthorized use
of

name,

trademark

infringement,

and

copyright

infringement

(except as to Toothman’s resume). It later denied Appellants’
motions

for

reconsideration

and

to

amend

their

complaint.

Finally, after the conclusion of discovery, it granted Zurich’s
motion for summary judgment on all remaining claims.
II.
Appellants
several

of

challenge

their

claims

the
for

district
failure
7

to

court’s
state

dismissal
a

claim,

of
its

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dismissal on summary judgment of their remaining claims, and its
denial of leave to amend their complaint. We review de novo the
district court’s dismissal for failure to state a claim, for
which we accept the pleaded facts as true. King v. Rubenstein,
825 F.3d 206, 214 (4th Cir. 2016). To survive dismissal, the
complaint

“must

contain

‘enough

facts

to

state

a

claim

for

relief that is plausible on its face.’” Id. at 214 (quoting Bell
Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)).
We also review de novo the district court’s decision to
grant summary judgment, applying the same legal standards that
guided the district court. Hoschar v. Appalachian Power Co., 739
F.3d 163, 169 (4th Cir. 2014). Thus, “we view the facts and draw
all reasonable inferences in the light most favorable to the
non-moving party.” Hoschar, 739 F.3d at 169 (quoting Glynn v.
EDO Corp., 710 F.3d 209, 213 (4th Cir. 2013)).
Finally,
reviewing

the

we

apply

district

an

abuse

court’s

of

discretion

decision

to

standard

deny

when

Appellants’

motion for leave to amend their complaint. We turn now to each
of Appellants’ claims and address them in order.
A.
We begin with the district court’s dismissal of Appellants’
claim

for

unjust

enrichment

pursuant

to

Fed.

R.

Civ.

P.

12(b)(6). In order to state a claim of unjust enrichment under
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Virginia law, a plaintiff must sufficiently allege that “(1) he
conferred a benefit on [the defendant]; (2) [the defendant] knew
of the benefit and should have reasonably expected to repay [the
plaintiff]; and (3) [the defendant] accepted or retained the
benefit without paying for its value.” Schmidt v. Household Fin.
Corp., II, 661 S.E.2d 834, 838 (Va. 2008). A plaintiff “must
plead

facts

showing

that

it

actually

conferred

a

benefit.”

Odyssey Imaging, LLC v. Cardiology Assoc. of Johnston, LLC, 752
F.Supp.2d 721, 725 (W.D. Va. 2010) (emphasis added).
Appellants’ complaint contained only conclusory allegations
regarding actual benefits conferred on Zurich. Indeed, the only
benefits
free

of

alleged

were

charge

items

during

and

the

services

proposal

Appellants

process.

provided

Appellants,

moreover, were fully apprised that Zurich intended to use some
of

that

material

in

an

effort

to

amend

its

expert

witness

designation, and that approval of the amended designation was a
condition precedent to Zurich’s acceptance of their Proposal.
Appellants’
could

promote

assertion
a

better

that

the

settlement

mere
for

use

of

Zurich

their
is

names
wholly

speculative and one that, in any case, Zurich could not have
realized, having withdrawn its motion to designate Toothman as
an expert before settling the Texas litigation. We therefore
conclude that the allegations in Appellants’ complaint fail to
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state a plausible claim for unjust enrichment. Twombly, 550 U.S.
at 570; Rubenstein, 825 F.3d at 214.
B.
The district court dismissed Appellants’ state law claims
against

Zurich

for

unauthorized

use

of

Devil’s

Advocate’s

corporate name and Toothman’s personal name. Virginia Code §
8.01-40(A), in pertinent part, provides:
Any person whose name, portrait, or picture is used
without having first obtained the written consent of
such person, or if dead, of the surviving consort and
if none, of the next of kin, or if a minor, the
written consent of his or her parent or guardian, for
advertising purposes or for the purposes of trade,
such persons may maintain a suit in equity against the
person, firm, or corporation so using such person’s
name, portrait, or picture to prevent and restrain the
use thereof; and may also sue and recover damages for
any injuries sustained by reason of such use. . . .
A corporate entity is not a “person” for purposes of the
Virginia statute. The language of § 8.01-40(A) plainly includes
only natural persons, as demonstrated by its discussion of the
ramifications of the death of the aggrieved person. See also
Silver Ring Splint Co. v. Digisplint, Inc., 567 F.Supp.2d 847,
855 (W.D. Va. 2008) (“Although the term ‘person’ in a statute
may often refer to both natural persons and corporations, the
text of § 8.01–40 makes clear that this statute applies only to
natural

persons.”).

Accordingly,

10

Appellants’

claim

against

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Zurich for unauthorized use of Devil’s Advocate’s corporate name
cannot proceed.
Toothman’s claim for the unauthorized use of his personal
name similarly fails. “[A] name is used for advertising purposes
when it appears in a publication which, taken in its entirety,
was distributed for use in, or as part of, an advertisement or
solicitation for patronage of a particular product or service.”
Town & Country Properties, Inc. v. Riggins, 457 S.E.2d 356 (Va.
1995); see also WJLA-TV v. Levin, 564 S.E.2d 383, 395 (Va. 2002)
(quoting Riggins and similarly holding that use of a name for
non-advertising purposes does not implicate § 8.01-40(A)).
Zurich’s use of Toothman’s name, in either a court filing
or email to opposing counsel, does not constitute advertising.
Nor did Zurich use Toothman’s name in the course of its own
business to buy, sell, or barter its goods or services. Va. Code
§ 8.01-40(A).

Indeed, we are unable to discern what additional

legal services Zurich could have intended to solicit by the mere
use of Toothman’s name and conclude Zurich did not violate §
8.01-40(A).
C.
In dismissing Appellants’ trademark infringement claim as
time-barred,

the

district

court

applied

Virginia’s

two-year

limitation period applicable to fraud claims. The Lanham Act,
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which governs Appellants’ trademark claims, does not specify a
statute of limitations, but rather applies the analogous state
law limitations period. See PBM Products, LLC v. Mead Johnson &
Co., 639 F.3d 111, 121 (4th Cir. 2011)(finding false advertising
claim under the Lanham Act analogous to Virginia fraud law and
subject to two-year limitation). 4
Devil’s Advocate, however, insists that under Virginia law
trademarks and brand names are property subject to a five year
statute

of

limitations.

In

Lavery

v.

Automation

Mgmt.

Consultants, Inc., 360 S.E.2d 336 (Va. 1987), a case dealing
specifically with the prohibition in Virginia Code § 8.01-40(A)
regarding the unauthorized use of a person’s name, 5 the Supreme
Court

of

plaintiff’s

Virginia
name

to

held

that,

bolster

its

where

a

proposal

defendant
for

a

uses

contract,

a
a

property right exists in the plaintiff’s name or likeness that

4

See also Teaching Co. Ltd. P’ship v. Unapix Entm’t, Inc.,
87 F. Supp. 2d 567, 585 (E.D. Va. 2000) (stating that the
applicable limitations period for federal and common law
trademark infringement and unfair competition claims is two
years); Unlimited Screw Prods., Inc. v. Malm, 781 F. Supp. 1121,
1125 (E.D. Va. 1991) (“Virginia’s statute of limitations for
fraud most closely resembles federal policy reflected in the
Lanham Act.”).
5

Here, Appellants pressed a separate claim for violation of
§ 8.01-40(A), which, as we have already noted, the district
court properly dismissed.
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to

the

five

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year

property

claim

statute

of

limitations. Lavery simply has no bearing on federal trademark
analysis under the Lanham Act.
district

court’s

infringement

conclusion

claim

is

Accordingly, we agree with the

that

Devil’s

time-barred

Advocate’s

under

trademark

Virginia’s

two-year

statute of limitations for fraud.
D.
The

district

court

dismissed

Appellants’

claim

against

Zurich for copyright infringement, finding the Proposal lacked
substantial similarity to the designation filed by Zurich in the
Texas litigation. A plaintiff seeking to recover on a copyright
infringement claim must prove not only that he “owned a valid
copyright and that the defendant copied the original elements of
that

copyright,”

‘substantially

but

similar’

also
to

that
the

the

“defendant’s

protectable

elements

work
of

is
the

plaintiff’s work.” Building Graphics, Inc. v. Lennar Corp., 708
F.3d 573, 577-78 (4th Cir. 2013) (quotations omitted).
Determining “substantial similarity” involves an analysis
of

extrinsic

and

intrinsic

similarity.

Humphreys

&

Partners

Architects, L.P. v. Lessard Design, Inc., 790 F.3d 532, 537-38
(4th

Cir.

similarity

2015)

(citations

objectively,

omitted).

looking

at

We

evaluate

“external

extrinsic

criteria”

to

determine whether the alleged copy is substantially similar to
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the “protected elements of the copyrighted work.” Id. at 538
(quoting Universal Furniture Int’l, Inc. v. Collezione Europa
USA, Inc., 618 F.3d 417, 435 (4th Cir. 2010)). In contrast, we
consider

intrinsic

similarity

from

the

“perspective

of

the

[works’] intended observer,” looking at the “total concept and
feel of the works” to determine whether they are substantially
similar. Id. (quoting Universal Furniture, 618 F.3d at 436).
The

district

court

concluded

that

Appellants’

copyright

infringement claim failed for lack of substantial similarity.
Although Appellants contend that only a jury may determine the
extrinsic similarity prong, we observed in Copeland v. Bieber
that
. . . a district court may grant a motion to dismiss
or summary judgment under the extrinsic prong alone.
See Universal Furniture, 618 F.3d at 436 (“A court may
grant summary judgment for defendant as a matter of
law if the similarity between the two works concerns
only noncopyrightable elements of the plaintiff’s
work.” (quoting Herzog v. Castle Rock Entm’t, 193 F.3d
1241, 1257 (11th Cir.1999))); see also Lyons, 243 F.3d
at 803 (court decides as a “matter of law” whether
extrinsic similarity exists).
789 F.3d 484, 490 (4th Cir. 2015). Therefore, a district court
may

properly

dismiss

a

copyright

claim

in

the

absence

of

substantial similarity.
Our review of the extrinsic nature of the two documents
reinforces the conclusion that they lack substantial similarity.
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Proposal

familiarity

discusses

with

the

Pg: 15 of 24

Appellants’

parties

conflicts,

involved,

his

Toothman’s

academic

and

professional experience, an overview of the billing structure,
and

some

observations

designation,
matter

on

by

on

the

contrast,

which

Zurich’s

Texas

generally
two

litigation.
summarizes

experts

The

expert
subject

testify

would

the

without

specifying the material about which either intended to opine.
Appellants accuse Zurich of plagiarizing the Proposal, but a
review of the two documents convinces us not only that there is
no substantial similarity, but little if any similarity.
With

regard

to

the

intrinsic

similarity

prong,

we

find

scant similarity in the “concept and feel” between the Proposal
and

the

designation

Zurich

submitted

to

the

Texas

court.

Humphreys, 790 F.3d at 538. The former is an offer for services,
covering
discussing
would

a

variety
the

testify.

of

subject
It

is

topics,
matter

on

implausible

the

latter

which
that

a

Zurich’s
any

court

filing

two

experts

intended

audience

could view these two documents as intrinsically similar.
E.
Devil’s Advocate’s breach of contract claim fails for want
of any evidence that the parties had the necessary meeting of
the minds to form an enforceable contract. While it concedes the
parties never physically executed a contract, Devil’s Advocate
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nevertheless argues that Zurich implicitly agreed to the terms
of the Proposal.
In Charbonnages de France v. Smith, 597 F.2d 406, 414-15
(4th

Cir.

lengthy,

1979),

drawn

out

we

concluded

that

negotiations,

when

which

parties

include

engage
“jumble

a

in
of

letters, telegrams, acts, and spoken words,” it is for a jury to
decide whether they actually formed a contract. Id. at 415; see
also Restatement (Second) of Contracts, § 20, Comment c. (1981). 6
No “jumble” of contract negotiations occurred in this case, but
rather an unequivocal rejection by Zurich of the Appellants’
Proposal

as

acknowledged

“unacceptable.”
that

Consequently,

our

Zurich

J.A.

“wanted

holding

in

353-54.
to

pay

Toothman,
less.”

Charbonnages

moreover,

J.A.

raises

no

373-74.
bar

to

summary judgment.
Devil’s
argument

Advocate’s

that

the

use

contract
of

its

claim
name,

rests
in

solely

either

the

on

its

expert

designation or email to opposing counsel, manifested Zurich’s

6

See also Cabot Oil & Gas Corp. v. Daugherty Petroleum,
Inc., 479 Fed. Appx. 524, 530 (4th Cir. 2012) (unpublished)
(describing the contours of the holding in Charbonnages and
finding that a similar period of negotiations, with a similar
amount of email correspondence, did not constitute a “jumble”
that would preclude summary judgment).

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assent to the contract. Dancy, however, testified that during a
telephone

call

in

early

November

he

notified

Toothman

that

Zurich could not retain him until allowed by the Texas Court to
amend its expert designation. Toothman was fully aware of this
condition precedent.
Toothman
happened,

but

baldly

asserts

that

the

evidence

in

this
the

telephone
record

is

call

never

otherwise.

Particularly damning is Toothman’s email of November 8, 2010,
explicitly acknowledging his understanding that although Zurich
had disclosed his name it had not yet retained him: “Naming me
as a witness before we were retained is likely to cause some
issues with Gardere and Voys.” 7 J.A. 425. Toothman, a lawyer,
plainly understood Zurich’s obligation to disclose his name to
the Texas court in order to obtain leave to amend its expert
designation.
Finally,

Appellants’

argument

that

Zurich’s

designation

triggered acceptance of the contract is unavailing.

The record

is devoid of any evidence, disputed or otherwise, that Zurich
ever assented to a contract in this case.

7

Gardere and Voys were two attorneys involved in
underlying Texas litigation that led to the billing dispute.
17

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F.
The district court granted summary judgment to Zurich on
Toothman’s claim for conversion of his name and reputation. 8 To
recover on a claim of conversion under Virginia law, a plaintiff
must establish (1) that he owned or had a possessory right to
the property at the time of the alleged conversion, and (2) that
the defendant wrongfully exercised dominion or control over that
property,

thereby

depriving

plaintiff

of

its

possession. 9

Economopoulous v. Kolaitis, 528 S.E.2d 714, 719 (Va. 2000). A
plaintiff cannot satisfy the second prong where he has consented
to the use of the subject property. See Williams v. Reynolds,
2006 WL 3198968, at *3 (W.D. Va. 2006) (“‘[W]rongful exercise of
dominion or control’ cannot be established where the plaintiff

8

Initially, the district court granted Zurich’s motion to
dismiss the conversion claim as to Devil’s Advocate’s trademarks
or copyrights, but denied it as to Toothman’s name and
reputation. J.A. 180-81. Subsequently, it granted summary
judgment to Zurich on the conversion claim as to Toothman’s name
and reputation. Appellants have failed to address the parts of
the conversion claim dismissed by the district court, and thus
have waived any appeal on those claims. See Locklear v. Bergman
& Beving AB, 457 F.3d 363, 365, n. 2 (4th Cir. 2006).
9

Although Toothman repeatedly argues that his name is a
property right, no one, including the district court, has ever
disputed this. For the purpose of our analysis here, we accept
that courts may consider a name and reputation as property but
need not address whether the mere use of a name by another
somehow deprives the owner of its possession.
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grants permission to the defendant to possess that property.”).
Indeed, Virginia has long recognized that implied consent is a
bar to conversion claims. See, e.g., Kewanee Private Utilities
Co. v. Norfolk Southern Ry. Co., 88 S.E. 95, 99 (Va. 1916) 10; see
also Restatement (Second) of Torts § 252.
whether

Toothman

consented

to

Zurich’s

The question here is
use

of

his

name

and

reputation.
During his deposition, Toothman acknowledged that he knew
Zurich

needed

the

court’s

permission

to

designate

him

as

an

expert in the Texas litigation. J.A. 380. Furthermore, in an
email to Dancy on November 8, 2010, he acknowledged that he had
been “named” before being retained. J.A. 245. Nonetheless, he
insists there

is

a

difference

between

simply

being

named

by

Zurich and being designated by it as an expert in the Texas
litigation.
This argument is unpersuasive. The manner in which Zurich
disclosed Toothman’s name, whether in an email, a court filing,
discovery designation, or a telephone call is immaterial. The

10

Other jurisdictions also have recognized implied consent
as a bar to a conversion claim. See e.g., Bank of N.Y. v.
Fremont Gen. Corp., 523 F.3d 902, 914 (9th Cir. 2008); Chemical
Sales Co., Inc. v. Diamond Chem. Co., Inc., 766 F.2d 364, 369
(8th Cir. 1985); Lawyers Title Ins. Corp. v. Dearborn Title
Corp., 904 F. Supp. 818, 821 n.2 (N.D. Ill. 1995).
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fact remains Toothman knew that, in order to obtain permission
to designate him as an expert, Zurich needed to disclose his
name to the court and opposing counsel, and he permitted such
disclosure.
Moreover, despite having knowledge by at least December 8,
2010, that Zurich had disclosed his name, Toothman failed to
object until January 13, 2011. 11 He disputes that he did not
promptly object, claiming that his email to Dancy on December 8
“expresses a lack of consent and outright concern.” Appellants’
Reply

Brief

at

21

n.

11.

We

are

unpersuaded.

Toothman’s

statement, “[n]aming me as a witness before we were retained is
likely to cause some issues with Gardere and Voys,” J.A. 425,
evinces

his

concern

about

the

effect

disclosure

of

his

name

might have on his personal interactions with two of the lawyers
involved in the case, both of whom he expected to see at an
upcoming conference.

It is not evidence of lack of consent to

the use of his name.

11

Dancy’s uncontroverted testimony is that Toothman
actually knew from the very beginning of the negotiations that
Zurich had to disclose his name to the court as a condition
precedent to Zurich’s acceptance of the contract.
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G.
Zurich is also entitled to summary judgment on Toothman’s
claim that it infringed the copyright to his resume. The “fair
use” doctrine allows persons to use copyrighted material in a
reasonable manner without permission. Such use is determined on
a case-by-case basis, using the following four factors set out
in 17 U.S.C. § 107:
(1)

(2)
(3)

(4)

the purpose and character of the use, including
whether such use is of a commercial nature or is
for nonprofit educational purposes;
the nature of the copyrighted work;
the amount and substantiality of the portion used
in relation to the copyrighted work as a whole;
and
the effect of the use upon the potential market
for or value of the copyrighted work.

In Bond v. Blum, 317 F.3d 385 (4th Cir. 2003), where a copy
of a manuscript had been used as evidence in a trial, we noted
that

the

“primary

“induc[ing]
author’s

release
or

public
to

artist’s]

purpose”

the

public

creative

of
of

the

Copyright

the

products

genius.”

Id.

Act
of
at

was
[the
393.

Additionally, we pointed out that “copyright protection does not
extend to ideas or facts even if such facts were discovered as
the product of long and hard work.” Id. at 394.

After weighing

the factors of 18 U.S.C. § 107, we concluded that the defendant
had not used the manuscript for monetary gain, and that its use
had no negative impact on its marketability. Consequently, we
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use

of

the

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copyrighted

manuscript

in

a

court

proceeding fell within the ambit of fair use. 12 Id. at 395-97.
The factors in Bond weigh heavily in favor of a finding of
fair use here. Toothman’s resume employed no mode of expression,
but merely collected and restated known facts. Zurich’s use was
not for profit or in a traditionally commercial sense.

Although

reproduced in its entirety, Toothman’s resume “was not used to
undermine any right conferred by the Copyright Act.” Id. at 396.
Finally,

Zurich’s

use

of

the

resume

did

not

affect

its

marketability. Unlike a manuscript, or other copyrightable works
consumers

might

actually

purchase,

there

is

no

market

for

Toothman’s resume as such, nor have Appellants credibly argued
otherwise.

12

Several of our sister circuits also have concluded that
use of copyrighted material in court proceedings is fair use.
See e.g., Hollander v. Steinberg, 419 Fed. Appx. 44, 47-48 (2nd
Cir. 2011) (affirming summary judgment on fair use where
attorney sued opposing counsel for filing his essays in a
judicial proceeding); Jartech, Inc. v. Clancy, 666 F.2d 403, 407
(9th Cir. 1982) (affirming fair use where adult films were
copied for use in judicial proceedings, were not made for
subsequent use or enjoyment, and were not for commercial use);
Shell v. DeVries, 2007 WL 324592 (D. Colo. Jan. 31, 2007)
(finding fair use where a portion of a copyrighted website was
used as an exhibit to a motion for attorney’s fees), aff’d 2007
WL 4269047 (10th Cir. 2007).

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H.
Finally, we conclude that the district court did not abuse
its discretion in denying as futile Appellants’ motion to amend
the complaint. Under Fed. R. Civ. P. 15(a), the directive to
grant leave to amend freely is not simply a suggestion, but
rather a “mandate to be heeded.” Foman v. Davis, 371 U.S. 178,
182 (1962). Leave to amend should be denied “only when” there is
the

presence

of

bad

faith,

futility,

or

prejudice

to

the

opposing party. See Edwards v. City of Goldsboro, 178 F.3d 231,
242 (4th Cir. 1999) (quoting Johnson v. Oroweat Foods Co., 85
F.2d 503, 509 (4th Cir. 1986)).
Although a district court possesses discretion to grant or
deny the opportunity to amend, “an outright refusal to grant the
leave without any justifying reason appearing for the denial is
not

an

exercise

discretion

and

of

discretion;

inconsistent

it

with

is

the

merely
spirit

abuse
of

the

of

that

Federal

Rules.” Foman, 371 U.S. at 182; see also Matrix Capital Mgmt.
Fund LP v. BearingPoint Inc., 576 F.3d 172, 194 (4th Cir. 2009).
Nevertheless, a detailed, explicit explanation of the reasons
for denying leave to amend is not necessary when the reasons are
evident. See Matrix Capital, 576 F.3d at 194.
When it denied Appellants’ motion to amend their complaint
to

compensate

district

court

for

deficiencies

noted

that

in

“leave
23

the
to

counts

amend

dismissed,

would

be

the

futile,

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because [Appellants’] proposed amendments to the Complaint add
no new facts that would allow [their] claims to survive a motion
to

dismiss.”

J.A.

714.

Appellants’

attempt

to

add

four

conclusory statements, most of which had previously been alleged
or inferred, and to increase the amount owed under the alleged
contract

from

$69,233.82

to

$84,000.00,

added

no

facts

that

would have altered the district court’s earlier dismissal under
Rule 12(b)(6). We have previously held that “[t]here is no error
in disallowing an amendment when the claim sought to be pleaded
by amendment plainly would be subject to a motion to dismiss
under

Fed.R.Civ.P.

12(b)(6).”

Frank

M.

McDermott,

Ltd.

v.

Moretz, 898 F.2d 418, 420-21 (4th Cir. 1990). Accordingly, the
district court did not abuse its discretion.
III.
For the reasons discussed, the judgment of the district
court is
AFFIRMED.

24