LegalZoom.com Inc v. Rocket Lawyer Incorporated

Filing 18

ANSWER to Amended Complaint 14 LegalZoom.com Inc.'s Answer to Rocket Lawyer Incoporated's Amended Counterclaims filed by plaintiff LegalZoom.com Inc. (Attachments: # 1 Certificate of Service)(Heather, Fred)

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PATRICIA L. GLASER - State Bar No. 55668
[e-mail]
FRED D. HEATHER - State Bar No. 110650
[e-mail]
MARY ANN T. NGUYEN – State Bar No. 269099
[e-mail]
GLASER WEIL FINK JACOBS
HOWARD AVCHEN & SHAPIRO LLP
10250 Constellation Boulevard, 19th Floor
Los Angeles, California 90067
Telephone: [phone]
Facsimile: [phone]
Attorneys for Plaintiff
LegalZoom.com, Inc.

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UNITED STATES DISTRICT COURT

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CENTRAL DISTRICT OF CALIFORNIA

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WESTERN DIVISION

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LEGALZOOM.COM, INC., a Delaware
corporation

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Plaintiff,

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v.

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ROCKET LAWYER INCORPORATED,
a Delaware corporation

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Defendant.

CASE NO.: CV 12-9942-GAF (AGRx)
Hon. Gary A. Feess
LEGALZOOM.COM, INC.’S
ANSWER TO ROCKET LAWYER
INCORPORATED’S AMENDED
COUNTERCLAIMS
Courtroom: 740
Judge:
Judge Gary A. Feess
255 East Temple Street
Los Angeles, CA 90012
Original Complaint Filed: November
20, 2012

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LEGALZOOM.COM, INC.’S ANSWER TO ROCKET LAWYER INCORPORATED’’S AMENDED
COUNTERCLAIMS
787780

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Plaintiff LegalZoom.com, Inc. (“LegalZoom” or “Plaintiff”), by and through its

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undersigned counsel, hereby respond to, and answer as follows to Defendant Rocket

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Lawyer Incorporated’s (“RocketLawyer” or “Defendant”) Counterclaims:
ANSWER

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1.

Denied. LegalZoom has brought this lawsuit to expose the willful and

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systematic acts of false advertising and unfair competition by RocketLawyer, which

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misleads consumers and inflicts competitive harm upon LegalZoom and others.

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2.

Denied. LegalZoom specifically denies that it “created” or “sanctioned

the creation” of the website Legalspring.com. LegalZoom further denies that
Legalspring.com’s registrant and manager, Travis Giggy, is LegalZoom’s agent.

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3.

Admitted.

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4.

Admitted.

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5.

Denied except to admit that the court has personal jurisdiction over it.

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6.

Admitted.

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7.

Admitted.

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8.

Denied. LegalZoom provides personalized, affordable, online legal

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solutions for families and small businesses.
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Denied except to admit that LegalZoom was founded in 2000 by

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attorneys with experience at some of the top law firms in the country, and has helped

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over two million Americans become protected with binding legal documents.

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10.

After reasonable investigation, LegalZoom is without knowledge or

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information sufficient to form a belief as to the truth of the allegations of this

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paragraph and they are therefore denied.

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11.

After reasonable investigation, LegalZoom is without knowledge or

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information sufficient to form a belief as to the truth of the allegations of this

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paragraph and they are therefore denied.

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12.

After reasonable investigation, LegalZoom is without knowledge or

information sufficient to form a belief as to the truth of the allegations of this
LEGALZOOM.COM, INC.’S ANSWER TO ROCKET LAWYER INCORPORATED’’S AMENDED
COUNTERCLAIMS

787780

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paragraph and they are therefore denied.
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After reasonable investigation, LegalZoom is without knowledge or

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information sufficient to form a belief as to the truth of the allegations of this

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paragraph and they are therefore denied.

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14.

Admitted.

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15.

Denied. LegalZoom does not currently purchase search terms from

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Google and other search engines such as Bing.com and Yahoo.com that relate to

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RocketLawyer.

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16.

After reasonable investigation, LegalZoom is without knowledge or

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information sufficient to form a belief as to the truth of the allegations of this

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paragraph and they are therefore denied. However, to the extent that this paragraph

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purports to interpret the contents of the SpyFu.com website and the Wall Street

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Journal article, such documents, being in writing, speak for themselves.

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17.

Admitted.

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18.

The allegations of this paragraph are conclusions of law to which no

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response is required. To the extent any allegations in paragraph 18 are factual,

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LegalZoom denies all such allegations to the extent that such allegations pertain to it.

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19.

LegalZoom admits only that certain of LegalZoom’s advertisements for

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its incorporation services say “Launch your new corporation. Free to Get Started,”

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but specifically denies that the language is in any way similar to RocketLawyer’s

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advertisements.

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20.

After reasonable investigation, LegalZoom is without knowledge or

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information sufficient to form a belief as to the truth of the allegations of this

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paragraph and they are therefore denied.

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21.

After reasonable investigation, LegalZoom is without knowledge or

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information sufficient to form a belief as to the truth of the allegations of this

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paragraph and they are therefore denied.

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22.

The allegations of this paragraph are conclusions of law to which no

LEGALZOOM.COM, INC.’S ANSWER TO ROCKET LAWYER INCORPORATED’’S AMENDED
COUNTERCLAIMS
787780

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response is required. To the extent any allegations in paragraph 22 are factual,

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LegalZoom denies all such allegations to the extent that such allegations pertain to it

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except to admit that RocketLawyer has registered the two domain names –

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www.legalzoomer.com and www.legalzoomgadget.com.

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23.

Denied. When accessing Legalzoomer.com on Internet Explorer,

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Mozilla and Chrome, a user is directed to the GoDaddy.com website, which provides

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the greeting, “Welcome to legalzoomer.com.”

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24.

After reasonable investigation, LegalZoom is without knowledge or

information sufficient to form a belief as to the truth of the allegations of this

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paragraph and they are therefore denied. However, if RocketLawyer is in fact willing

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to transfer these domains to LegalZoom, LegalZoom will accept RocketLawyer’s

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transfer of these domains to LegalZoom.

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Admitted.

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26.

After reasonable investigation, LegalZoom is without knowledge or

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information sufficient to form a belief as to the truth of the allegations of this

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paragraph and they are therefore denied.

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27.

Denied except to admit that LegalZoom operates

www.legalcenterpro.com.
28.

Denied except to the extent that this paragraph purports to characterize

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the Reuter article and LegalZoom’s May 10, 2012 S-1 filing. Such documents, being

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in writing, speak for themselves.

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29.

Denied.

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30.

Denied.

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31.

Denied except to admit that LegalZoom states on its website that it is the

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leading, nationally recognized legal brand for small business and consumers in the

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United States.

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32.

The allegations of this paragraph are conclusions of law to which no

response is required. To the extent any allegations in paragraph 32 are factual,
LEGALZOOM.COM, INC.’S ANSWER TO ROCKET LAWYER INCORPORATED’’S AMENDED
COUNTERCLAIMS

787780

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LegalZoom denies all such allegations to the extent that such allegations pertain to it.
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Denied except to admit that Legalspring.com does not reference, among

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other legal services websites, Rocket Lawyer. Legalspring.com does, however,

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reference (and provide reviews) for some of LegalZoom’s top competitors.

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34.

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speaks for itself.

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35.

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Admitted only that the Legalspring.com website is a document that

Denied except to admit that Legalspring.com is registered to Travis

Giggy.
36.

Denied except to admit that Legalspring.com, is a participant in

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LegalZoom’s Affiliate Program and, as a participant, is entitled to receive a

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commission for directing customers of Legalspring.com to the LegalZoom website

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using a unique URL.

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37.

The allegations of this paragraph are conclusions of law to which no

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response is required. To the extent any allegations in paragraph 32 are factual,

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LegalZoom denies all such allegations to the extent that such allegations pertain to it.

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38.

Denied.

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39.

Denied.

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40.

Admitted only that the Legalspring.com website is a document that

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speaks for itself.

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41.

Denied except to admit that LegalZoom operated

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www.legalcenterpro.com and www.lightwavelaw.com. Legaldocumentfinder.com

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and Estateguidance.com are independent affiliate sites.

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42.

Denied.
COUNT I

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43.

Realleges paragraphs 1 through 42.

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44.

Denied except to admit that an actual and justiciable case and

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controversy exists between the parties as to whether RocketLawyer has engaged in

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federal false advertising or unfair competition in violation of the Lanham Act based
LEGALZOOM.COM, INC.’S ANSWER TO ROCKET LAWYER INCORPORATED’’S AMENDED
COUNTERCLAIMS

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on its advertisements of its purportedly “free” services and the terms of its “free”

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services.

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45.

Denied.
COUNT II

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46.

Realleges paragraphs 1 through 45.

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47.

Denied except to admit that an actual and justiciable case and

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controversy exists between the parties as to whether RocketLawyer has engaged in

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false advertising in violation of California Business and Professions Code section

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17500 based on its advertisements of its purportedly “free” services and the terms of

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its “free” services.
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Denied.
COUNT III

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49.

Realleges paragraphs 1 through 48.

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50.

Denied except to admit that an actual and justiciable case and

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controversy exists between the parties as to whether RocketLawyer has engaged in

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unfair competition in violation of California Business and Professions Code section

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17200 based on its advertisements of its purportedly “free” services and the terms of

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its “free” services through key word bidding.

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51.

Denied.
COUNT IV

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52.

Realleges paragraphs 1 through 51.

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53.

LegalZoom is without knowledge or information sufficient to form a

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belief as to the truth of any of the allegations set forth in this paragraph and they are

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therefore denied.

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54.

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Denied except to admit that LegalSpring.com states that LegalZoom is

the best legal services website.

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55.

Denied.

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56.

Denied.

LEGALZOOM.COM, INC.’S ANSWER TO ROCKET LAWYER INCORPORATED’’S AMENDED
COUNTERCLAIMS
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57.

Denied.

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58.

Denied.

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59.

Denied.
COUNT V

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60.

Realleges paragraphs 1 through 59.

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61.

Denied.

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62.

LegalZoom is without knowledge or information sufficient to form a

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belief as to the truth of any of the allegations set forth in this paragraph and they are

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therefore denied.

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63.

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Denied except to admit that LegalSpring.com states that LegalZoom is

the best legal services website.

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64.

Denied.

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65.

Denied.

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66.

Denied.

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67.

Denied.

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68.

Denied.

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69.

Denied.
COUNT VI

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70.

Realleges paragraphs 1 through 69.

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71.

Denied.

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72.

Denied.

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73.

Denied.

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74.

Denied.

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75.

Denied.

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76.

Denied.

RESPONSE TO ROCKETLAWYER’S PRAYER FOR RELIEF

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1.

The remaining paragraphs contain prayers for relief to which no response

is required. To the extent a response is required, LegalZoom denies that
LEGALZOOM.COM, INC.’S ANSWER TO ROCKET LAWYER INCORPORATED’’S AMENDED
COUNTERCLAIMS

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RocketLawyer is entitled to any relief.

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AFFIRMATIVE DEFENSES

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LegalZoom provides its affirmative defenses as known at this time below

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without assuming the burden of proof when such burden would otherwise be on

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RocketLawyer.

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FIRST AFFIRMATIVE DEFENSE

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(Failure to State a Claim)

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1.

RocketLawyer fails to state a claim upon which relief may be granted.

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SECOND AFFIRMATIVE DEFENSE

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(Unclean Hands)

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2.

RocketLawyer’s claims and remedies are barred, in whole or in part, for

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want of equity or by the doctrine of unclean hands. Specifically, RocketLawyer

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engages in false and misleading advertising and unfair competition practices. See

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First Amended Complaint at ¶¶ 12-16. RocketLawyer’s unclean hands warrant

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dismissal and denial of all remedies.

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THIRD AFFIRMATIVE DEFENSE

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(Injunctive Relief Unavailable)

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3.

RocketLawyer is not entitled to an injunction because, among other

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things, assuming it was entitled, RocketLawyer has an adequate remedy at law, and

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no basis exists for the grant of equitable relief.

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FOURTH AFFIRMATIVE DEFENSE

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(Laches)

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4.

On information and belief, RocketLawyer delayed filing suit for an

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unreasonable and inexcusable length of time from when it knew or reasonably should

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have known of LegalZoom’s alleged misconducts. RocketLawyer raises the alleged

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misconduct only to attempt to deflect the negative publicity resulting from

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LegalZoom’s filing of its complaint against RocketLawyer. This delay has prejudiced

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and injured LegalZoom.
LEGALZOOM.COM, INC.’S ANSWER TO ROCKET LAWYER INCORPORATED’’S AMENDED
COUNTERCLAIMS

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FIFTH AFFIRMATIVE DEFENSE

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(Statute of Limitations)

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RocketLawyer’s claims are barred, in whole or in part, by the applicable

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statute of limitations to the extent that RocketLawyer’s claims are based on conduct

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outside the statute of limitations.

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SIXTH AFFIRMATIVE DEFENSE

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(Punitive and Exemplary Damages Unavailable)

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The requirements and circumstances warranting punitive and exemplary

damages are not satisfied. Even more, punitive damages is not an available remedy

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for the alleged violation of California Business and Professions Code Sections 17200

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and 17500.

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SEVENTH AFFIRMATIVE DEFENSE

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(No Agency)

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If RocketLawyer sustained any injury or incurred any loss or damages as

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alleged in RocketLawyer’s Counterclaims, such injuries were caused in whole or in

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part by acts or omissions of persons over whom LegalZoom neither exercised nor had

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any right of control for whom LegalZoom is and was not responsible, and whose

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conduct LegalZoom had no duty or reason to anticipate or control. Specifically,

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Legalspring.com’s registrant and manager, Travis Giggy, is not LegalZoom’s agent.

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EIGHTH AFFIRMATIVE DEFENSE

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(Lack of Standing)

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8.

its Amended Counterclaims.
RESERVATION OF ADDITIONAL DEFENSES

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RocketLawyer lacks standing to bring all or some of its claims alleged in

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Discovery in this action has not yet commenced and LegalZoom

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continues to investigate the allegations set forth in RocketLawyer’s Counterclaims.

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LegalZoom specifically gives notice that it intends to rely upon such other defenses as

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LEGALZOOM.COM, INC.’S ANSWER TO ROCKET LAWYER INCORPORATED’’S AMENDED
COUNTERCLAIMS
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may become available by law, or pursuant to statute, or discovery proceedings in this

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case, and hereby reserves the right to assert such additional defenses.
PRAYER FOR RELIEF

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WHEREFORE, LegalZoom respectfully requests:
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That RocketLawyer’s Counterclaims be dismissed in its entirety, with

prejudice;
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That RocketLawyer take nothing by way of its Counterclaims and that

judgment be rendered in favor of LegalZoom; and
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That LegalZoom be awarded its reasonable costs and attorneys’ fees and

such other and further relief as may be just and proper.

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DATED: February 11, 2013

GLASER WEIL FINK JACOBS
HOWARD AVCHEN & SHAPIRO LLP

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By: /s/ Fred D. Heather
PATRICIA L. GLASER
FRED D. HEATHER
MARY ANN T. NGUYEN
Attorneys for Plaintiff
LegalZoom.com, Inc.

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JURY TRIAL DEMAND
In accordance with Rule 38 of the Federal Rules of Civil Procedure and L.R.

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38-1, LegalZoom respectfully demands a trial by jury on all issues and claims so

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triable.

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LEGALZOOM.COM, INC.’S ANSWER TO ROCKET LAWYER INCORPORATED’’S AMENDED
COUNTERCLAIMS
787780