Inc v. Rocket Lawyer Incorporated

Filing 168


Download PDF
i PATRICIA L. GLASER -State Bar No. 55668 pglaser~a, 2 FRED I3. HEATHER -State Bar No. 110650 ( 3 AARONZ'. ALLAN -State Bar No. 144406 aallan~a, 4 GLASER WEIL FINK HOWARD AVCHEN & SHAPIRO LLP 5 10250 Constellation Boulevard, 19th Floor Los Angeles, California 90067 6 Telephone: (310)553-3000 Facsimile: (310)556-2920 Attorneys for Plaintiff s, Inc. 9 io O 1 '~. ~~ m,t ~~ vi ,_~ ~ CENTRAL DISTRICT OF CALIFORNIA >> ~~ Y ~ o UNITED STATES DISTRICT COURT WESTERN DIVISION tz LEGALZOOM.COM,INC., a Delaware corporation, 13 Plaintiff, v. -i %~ L L ~; ~ ~~ 3 '~' o 1.71S Hon. Gary A. Feess Courtroom: 740 ~4 LJ'~ v`,~ CASE NO.: CV 12-9942-GAF(AGE) 15 ROCKET LAWYER INCORPORATED, ~6 a Delaware corporation, 17 is 19 Zo Defendant. DECLARATION OF AARON P. ALLAN IN SUPPORT OF LEGALZOOM.COM,INC.'S OPPOSITION TO ROCKET LAWYER'S EX PARTE APPLICATION TO FILE MOTION TO SUPPLEMENT FACTUAL RECORD TBD Date: TBD Time: Courtroom: 740 zi 22 Complaint Filed: November 20, 2012 23 24 25 26 27 28 DECLARATION OF AARON P. ALLAN 961021 DECLARATION OF AARON P. ALLAN z I, AARON P. ALLAN,declare and state as follows: 3 1. 4 I am an attorney at law duly admitted to practice before all courts ofthe State of California and am a Partner of the law firm of Glaser Weil Fink Howard s Avchen &Shapiro LLP, attorneys of record herein for Plaintiff,Inc. 6 ("LegalZoom"). I submit this declaration in support of the "MEMORANDUM OF POINTS AND AUTHORITIES OF LEGALZOOM.COM,INC.IN OPPOSITION s TO ROCKET LAWYER'S EX PARTE APPLICATION TO FILE MOTION TO 9 SUPPLEMENT FACTUAL RECORD" I have personal knowledge of the facts set io forth herein, and if called upon to testify thereto, I could and would competently do so t~ a o ~ ~~. ~s cct N ~ i :a~ ~~ —~ 1z 13 under oath. 2. Attached hereto as Exhibit A is a true and correct copy of an email from Rocket Lawyer's counsel, Brian Cook, dated October 20, 2014, together with the t4 cover page of an agreed upon set of undisputed jury instructions, along with ~~~,~ 15 Instruction No. 22, which provides the "ELEMENTS OF FALSE ADVERTISING 'v v ~ ~ Q l6 (Lanham Act —Federal Law)" which has been agreed to by the parties, and which will be submitted to the Court on October 28, 2014, with the other pretrial filings. ~z is 19 3. Attached hereto as Exhibit B is a true and correct copy of the cover page and appropriate excerpts(pp. 19-20)from the Expert Report submitted by Dr. Larry Zo Chiagouris for this matter, dated April 15, 2014. While this report was designated as z~ "highly confidential" by LegalZoom,the two pages included do not contain 22 information that LegalZoom has determined must be filed under seal. As to the 23 remainder of Dr. Chiagouris' report, no waiver of the confidentiality designation is 24 intended by LegalZoom. 25 4. Attached hereto as Exhibit C is a true and correct copy of excerpts from 26 the Deposition ofPaul Hollerbach, who Rocket Lawyer designated to testify 27 regarding the damages it seeks in this litigation. 2s 5. Should the Court entertain this motion, LegalZoom proffers that Dr. DECLARATION OF AARON P. ALLAN 961021 Goedde will provide a declaration which confirms that his analysis, which resulted in 2 his supplemental report served on October 6, 2014, examined advertisements which 3 included the terms "free trial" and "free legal help," in his determination of 4 LegalZoom's lost profits. Dr. Goedde will confirm that each of these terms is present 5 in either(1) Rocket Lawyer's "free" business formation advertisements that do not 6 mention state filing fees, or in(2)Rocket Lawyer's advertisements using LegalZoom trademarks or similar terms as Internet search terms. As such, Dr. Goedde will g confirm that these terms are included in his calculation of LegalZoom's lost profits 9 due to the actions of Rocket Lawyer as described in paragraphs 15-34 of Dr. 10 tt ~, o .D L O a Goedde's supplemental report. I declare under penalty of perjury under the laws of the State of California and i 2 the United States that the foregoing is true and correct. Executed on October 22, ;~~ ~~ :~ ~3 2014, at Los Angeles, California. ~ c u- ~ —': u v~Q ~D 14 L~ i ~( cis AARON P. ALLAN 15 16 ~~ O ~~Z 17 18 19 20 21 22 23 24 25 26 27 28 3 DECLARATION OF AARON P. ALLAN 961021 EXHIBIT A Aaron Allan From: Sent: To: Cc: Subject: Attachments: Cook, Brian W [] Monday, October 20, 2014 2:23 PM Aaron Allan Hainline, Forrest A; Jones, Michael T; Vu, Hong-An; Fred Heather RE: LZ/RLI -Undisputed and Disputed Jury Instructions 141020 Disputed Jury Instructions.DOCX; 141020 Undisputed Jury Instructions.DOCX Aaron, Pursuant to your email below, attached are revised versions of the Disputed and Undisputed Jury Instructions. Disputed Instruction Number 1: No change Disputed Instruction Number 2: Per the agreement below, this has been deleted and moved into the Undisputed Instructions as Number 26. Disputed Instruction Number 3: Previously deleted. Disputed Instruction Number 4: The second and third paragraphs have been deleted, as you agreed. We have supplemented our position with the argument made in our last email. Otherwise, no change. Disputed Instruction Number 5: Since we are agreed on the addition of the phrase "and the defendant has the burden if of proving otherwise," we have added that. We have also added our position that the instruction would be acceptable dispute. the word "must" were replaced with "may," which we understand you Disputed Instruction Number 6: No change. Disputed Instruction Number 7: Per the agreement below, this has been deleted and the revised version has been inserted as Undisputed Instruction Number 34. Disputed Instruction Number 8: No change. Disputed Instruction Number 9: Per the agreement below, this has been deleted and the revised version has been inserted as Undisputed Instruction Number 35. Disputed Instruction Number 10: No change. If we can reach agreement on disputed instruction number S, above, then Rocket Lawyer will withdraw this instruction. Disputed Instruction Number 11: No change. Disputed Instruction Number 12: No change. Thank you, Brian Cook Brian W. Cook Goodwin Procter ~~P 53 State Street Boston, MA 02109 T: 617-570-1 p81 1 2 3 4 5 Forrest A. Hainline III(SBN 64166) ainline~, on -An~V'u(SBN 266268) hvu a GO DWIN PROCTER LLr Three Embarcadero Center 24th Floor San Francisco, California 94111 Tel.: 415.733.6000 Fax.: 415.677.9041 ~ 6 7 8 9 Michael T. Jones(SBN 290660) ( m ones ~OOD~TN PROCTER Lr.r 135 Commonwealth Drive Menlo Park, California 94025-1 105 Tel.: 650.752.3100 Fax.: 650.853.1038 10 ~►? 13 Brian W. Cook (Pro Hac Vice) bcook( GOO~`GVIN PROCTER LLr 53 State Street Boston, MA 02109-2802 Tel.: 617.570.1000 Fax.: 617.523.1231 14 Attorneys ~or De endant ER INCORPORATED 15 ~ ROCKE7'LA 16 UNITED STATES DISTRICT COURT 17 18 19 20 CENTRAL DISTRICT OF CALIFORNIA WESTERN DIVISION LEGALZOOM.COM,INC., a Delaware Case No. 2:12-cv-09942-GAF-AGR corporation, UNDISPUTED JURY INSTRUCTIONS Plaintiff, 21 23 Judge Gary A. Feess 740 255 East Temple Street Los Angeles, CA 90012 Action Filed: November 20, 2012 Judge: Courtroom: v, 22 ROCKET LAWYER INCORPORATED,a Delaware corporation, 24 Defendant. 25 26 27 28 Formatted: Da ID 89G887.tA6TJV~Ei783r,3&~7,~J 1 INSTRUCTION NO.22 2 ELEMENTS OF FALSE ADVERTISING (Lanham Act —Federal Law) 3 Both parties have asserted claims against one another for false advertising 4 under the Lanham Act. To prove this claim, the party asserting the claim has the 5 burden of proving each of the following elements by a preponderance of the 6 evidence: 7 (1) 8 9 10 the other party made a false or misleading statement of fact about its own product or another's product in commercial advertising; (2) the statement actually deceived or has the tendency to deceive a substantial segment of its audience; (3) i~~ decision; 13 (4) the deception is material, in that it is likely to influence the purchasing the other party caused its false or misleading statement to enter l4 interstate commerce; and 15 l6 the party asserting the claim has been or is likely to be injured as a result of the false or misleading statement, either by direct diversion of sales from 17 itself to the other party or by a lessening ofthe goodwill associated with its 18 products. 19 (5) I will now explain each of these elements in detail. 20 22 Authority: Southland Sod Farms v. Stover Seed Co., 108 F.3d 1134, 1139(9th Cir. 1997); Newcal Indus., Inc. v. Ikon Office Solution, 513 F.3d 1038, 1054 (9th 23 c;r. Zoos; is u.s.c. § ~ i2s~a)(~)(B). 21 24 25 26 27 28 Formatted: Da ID 9GOEs7.,tAf7~I.V.E~/~78~3~i1&7~T~~3 34 EXHIBIT B 1 PATRICIA L. GLASER -State Bar No. 55668 pglaser 2 FRED .FATHER -State Bar No. 110650 flleather 3 MARY T. NGUYEN -State Bar No. 269099 4 GLASER WEIL FINK JACOBS HOWARD AVCHEN & SHAPIRO LLP 5 10250 Constellation. Boulevard, 19th Floor Los Angeles, California 90067 6 Telephone: (310) 553-3000 Facsimile: (310) 556-2920 Attorneys for Plaintiff s,Inc. 9 UNITED STATES DISTRICT COURT io CENTRAL DISTRICT OF CALIFORNIA ti WESTERN DIVISION 12 o o a U fC ~' ~ t ~ i1- € s °''<'[ ~~~ ~ L ~' `° o LEGALZOOM.COM,INC., a Delaware corporation, 13 Plaintiff, CASE NO.: CV 12-9942-GAF(AGRac) Hon. Gary A. Feess Courtroom: 740 14 is 16 i~ ig 19 20 21 22 23 24 25 26 27 28 REPORT OF DR.LARRY CHIAGOURIS,APRIL 15, 2014 v. ROCKET LAWYER INCORPORATED, a Delaware corporation, Defendants. Complaint Filed: November 20, 2012 • The word "free" is considered to be a power word by a wide variety of marketing practitioners and scholars. • Use ofthe word free in a search ad will likely have a positive impact on a business's search results and that impact will come at the expense of its competitors. • Use of affiliate marketing is a commonly accepted practice in the conduct of Internet marketing programs. I have reviewed documents provided to me that reflect complaints submitted by consumers to the Better Business Bureau.40 The vast majority of these complaints pertain to the communications by Rocket Lawyer in the use ofthe word free. These complaints are important given the material that I have already covered in this opinion. As already discussed, free is a very powerful word. Free is a word that can motivate people to take a positive action to adopt a product or service. Consumers will be disappointed if they seek to adopt a product that they believe is 100% free only to find out after they begin the adoption process that the product is not 100% free. This disappointment can produce negative business results for all the businesses that compete in a category. Consumer disappointment can lead to a loss of good will by other competitors in a category. The loss of good will would be highest for the market leader if consumers perceive that the business practices of one competitor are likely to be similar to the business practices of other competitors. Ina 2012 survey with 696 consumers, LegalZoom scored the highest awareness levels among the companies examined in the study41 The LegalZoom awareness levels were substantially higher than the next company's levels(73%for LegalZoom versus 46%for LegalZoom would clearly be considered a market leader if not the market leader in its category of legal services based on this survey data. BBB0000000-BBB0000255. uStamp 2012 Consumer Survey 40 41 HIGHLY CONFIDENTIAL 19 LegalZoom, as the market leader, clearly is likely to have experienced the greatest loss of good will due to any consumer disappointment created by Rocket Lawyer. HIGHLY CONFIDENTIAL 20 • Respectfully submitted, ., ; t Larry Chiagouris, Ph.D. President, BrandMarketing Services, Ltd. I reserve the right to supplement my opinions stated herein with any additional documents produced, additional pleadings, data, testing or depositions. In addition,I reserve the right to amend my opinion stated herein based on any additional material or information that is provided to me. HIGHLY CONFIDENTIAL 21 EXHIBIT C CONFIDENTIAL DEPOSITION OF PAUL HOLLERBACH 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 IN THE UNITED STATES DISTRICT COURT FOR THE CENTRAL DISTRICT OF CALIFORNIA WESTERN DIVISION LEGALZOOM.COM, INC., A DELAWARE CORPORATION, ) ) ) PLAINTIFF, ) ) VS. ) ) ROCKET LAWYER INCORPORATED, A ) DELAWARE CORPORATION, ) ) DEFENDANT. ) ______________________________) CASE NO. CV-12-9942-GAF (AGRX) C O N F I D E N T I A L (THE FOLLOWING TRANSCRIPT HAS BEEN DESIGNATED CONFIDENTIAL, FOR ATTORNEYS' EYES ONLY) INDIVIDUAL AND 30(B)(6) DEPOSITION DEPOSITION OF PAUL HOLLERBACH, TAKEN ON BEHALF OF THE PLAINTIFF, AT THREE EMBARCADERO, 24TH FLOOR, SAN FRANCISCO, CALIFORNIA, COMMENCING AT 9:59 A.M., WEDNESDAY, OCTOBER 1, 2014, BEFORE LANA L. LOPER, RMR, CRR, CCP, CME, CLR, CSR NUMBER 9667. 2 CONFIDENTIAL DEPOSITION OF PAUL HOLLERBACH 1 2 3 4 5 6 7 8 9 10 11 12 13 14 Q. OKAY. HAVE YOU DONE ANY SPECIFIC 15 FINANCIAL CALCULATIONS AS TO WHAT EFFECT ON ROCKET 16 LAWYER'S REVENUES HAVE BEEN CAUSED BY WHAT YOU 17 BELIEVE ARE THE ACTIONS STATED IN ROCKET LAWYER'S 18 COUNTER-CLAIM AGAINST LEGALZOOM? 19 A. WE HAVEN'T DONE SPECIFIC 20 CALCULATIONS AS IT RELATES TO THE LEGAL SPRING. 21 IT WOULD BE SOMEWHAT SPECULATIVE. 22 BUT I CAN -- BUT WE DO KNOW, IT'S A 23 MATTER OF FACT, THAT THE CLICK-THROUGH RATES AND 24 THE TRAFFIC DRIVEN ON CERTAIN AD PLACEMENTS ON THE 25 WEBSITE ARE HIGHER, ARE GREATER, THE HIGHER YOU 135 CONFIDENTIAL DEPOSITION OF PAUL HOLLERBACH 1 ARE IN THE SEARCH RESULTS PAGE. SO BY THEM TAKING THE FIRST, SECOND 2 3 OR THIRD PLACE, THEY'RE DIVERTING A HIGHER LEVEL 4 OF TRAFFIC AWAY FROM ROCKET LAWYER. AND ALSO, AS I SAID, IT'S A 5 6 WELL-KNOWN FACT THAT IF YOU'RE BIDDING FOR THE TOP 7 TERM, AND -- IT'S GOING TO COST YOU A LOT MORE 8 THAN IT IS FOR OTHERS. SO THEY DID CAUSE US HARM IN MAKING 9 10 US BID HIGHER, BID MORE, TO GET A PREMIUM 11 PLACEMENT ON GOOGLE. Q. 12 BUT YOU HAVEN'T PUT PEN TO PAPER TO 13 TRY AND MAKE ANY KIND OF MATHEMATICAL CALCULATION 14 AS TO THE VALUE OF THAT HARM THAT YOU BELIEVE 15 OCCURRED? 16 A. NO, I HAVE NOT. 17 Q. OKAY. 18 AND TO YOUR KNOWLEDGE, NO ONE ELSE AT ROCKET LAWYER HAS? 19 A. NO. 20 Q. I'M CORRECT ABOUT THAT; RIGHT? 21 A. TO MY KNOWLEDGE. 22 23 24 25 136

Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.

Why Is My Information Online?