Orange Lake Country Club, Inc. et al v. Castle Law Group, P.C. et al

Filing 177

ORDER granting in part and denying in part 99 Motion to Dismiss for Failure to State a Claim; granting in part and denying in part 103 motion to dismiss; granting in part and denying in part 106 Motion to Dismiss for Failure to State a Claim. Signed by Judge Gregory A. Presnell on 3/29/2018. (ED)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
ORLANDO DIVISION
ORANGE LAKE COUNTRY CLUB, INC.
and WILSON RESORT FINANCE,
L.L.C.,
Plaintiffs,
v.

Case No: 6:17-cv-1044-Orl-31DCI

CASTLE LAW GROUP, P.C., JUDSON
PHILLIPS ESQ, CASTLE MARKETING
GROUP, LLC, CASTLE VENTURE
GROUP, LLC, RESORT RELIEF, LLC,
WILLIAM MICHAEL KEEVER, KEVIN
HANSON and SEAN AUSTIN,
Defendants.

ORDER
This matter comes before the Court without a hearing on the motions to dismiss filed by
the following Defendants: Sean Austin (Doc. 99); Castle Law Group, P.C. (“Castle Law”) and
Judson Phillips (“Phillips”) (Doc. 103); and Resort Relief, LLC ( “Resort Relief”) and Kevin
Hanson (“Hanson”) (Doc. 106). In resolving the motions, the Court has considered the omnibus
response in opposition (Doc. 112) filed by the Plaintiffs, Orange Lake Country Club, Inc.
(“Orange Lake”) and Wilson Resort Finance, LLC (“Wilson Finance”).
I.

Background

The instant case involves a dispute between entities involved in selling timeshares and a
group that promises to help timeshare owners get out of their contracts. According to the
allegations of the Third Amended Complaint (Doc. 91) (henceforth, “TAC”), which are accepted
in pertinent part as true for the purpose of resolving the instant motions, Orange Lake develops

and sells timeshare properties throughout the United States, including Florida. (TAC at 5).
Individuals who buy timeshares from Orange Lake (henceforth, “Orange Lake Owners”)
sometimes obtain financing through Wilson Finance. (TAC at 6). The Plaintiffs allege that
Defendant Castle Venture Group, LLC (“Castle Venture”) funds Defendant Castle Marketing
Group, LLC (“Castle Marketing”), which (along with Resort Relief) solicits timeshare owners,
directing them to retain Castle Law. (TAC at 4). According to the records of these various
entities, Austin is the sole member of Castle Marketing (TAC at 6-7); Defendant William Keever
(“Keever”) and Austin are the members of Castle Venture (TAC at 7); Hanson is the sole member
of Resort Relief (TAC at 8); and Phillips, a lawyer, is associated with Castle Law (TAC at 7).
When they buy their timeshares, Orange Lake Owners enter into contacts in which they
agree to certain ongoing obligations. Among other things, they agree to pay assessments,
maintenance fees, and a portion of the common expenses for the entire development. (TAC at 56). According to the Plaintiffs, the Defendants are engaged in a scheme to swindle Orange Lake
Owners by falsely promising to get them out of these contracts. (TAC at 17). The Plaintiffs
contend that the Defendants use misleading advertising to solicit Orange Lake Owners, claiming a
high likelihood of success, when in reality they are rarely successful. (TAC at 18). Further, the
Plaintiffs contend, after Orange Lake Owners retain Castle Law, Castle Law advises them to
breach their contracts with Orange Lake as a way of increasing the chance that Orange Lake will
agree to let them out of their contracts. (TAC at 23-24).
The Plaintiffs filed the instant suit on June 8, 2017. (Doc. 1). In response to a motion to
dismiss for lack of jurisdiction (Doc. 24), the Plaintiffs filed an amended complaint (Doc. 29) on
August 7, 2017. After a second motion to dismiss on jurisdictional grounds 1 (Doc. 35), the

1

Both motions sought dismissal on the grounds that the Plaintiffs had failed to properly

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Plaintiffs filed a second amended complaint (Doc. 60) on September 21, 2017. On December 15,
2017, the Court granted in part motions to dismiss filed by Castle Law and Phillips (Doc. 61) and
by Austin (Doc. 62). The Court denied the motions insofar as they sought dismissal of the
Plaintiffs’ tortious interference with contract and civil conspiracy claims, but granted the motions
as to claims for tortious interference with advantageous business relationships, violations of the
Florida Deceptive and Unfair Trade Practices Act, Fla. Stat. §§ 501.201-501.23 (“FDUTPA”),
violations of Florida’s Vacation Plan and Timesharing Act, Fla. Stat. §§ 721.02-721.98
(“FVPTA”), and a standalone claim for injunctive relief. (Doc. 84 at 4-7).
On December 27, 2017, the Plaintiffs filed their Third Amended Complaint (Doc. 91). In
addition to the claims for tortious interference with contract (Count I) and civil conspiracy (Count
II), which survived from the previous pleading, the Plaintiffs again assert claims for violations of
the FVPTA (Count III) and FDUTPA (Count IV). In addition, they assert claims under the
Lanham Act, 15 U.S.C. 1125(a) (Counts V-VI) and for misleading advertising in violation of Fla.
Stat. § 817.41 (Counts VII-VIII).
II.

Legal Standard

Federal Rule of Civil Procedure 8(a)(2) requires “a short and plain statement of the claim
showing that the pleader is entitled to relief” so as to give the defendant fair notice of what the
claim is and the grounds upon which it rests, Conley v. Gibson, 355 U.S. 41, 47, 78 S.Ct. 99, 103,
2 L.Ed.2d 80 (1957), overruled on other grounds, Bell Atlantic Corp. v. Twombly, 550 U.S. 544,
127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). A Rule 12(b)(6) motion to dismiss for failure to state a
claim merely tests the sufficiency of the complaint; it does not decide the merits of the case.

plead the citizenship of one or more parties, a requirement for a Court to determine whether it
possesses diversity jurisdiction over a dispute.

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Milburn v. United States, 734 F.2d 762, 765 (11th Cir.1984). In ruling on a motion to dismiss,
the Court must accept the factual allegations as true and construe the complaint in the light most
favorable to the plaintiff. SEC v. ESM Group, Inc., 835 F.2d 270, 272 (11th Cir.1988). The
Court must also limit its consideration to the pleadings and any exhibits attached thereto. Fed. R.
Civ. P. 10(c); see also GSW, Inc. v. Long County, Ga., 999 F.2d 1508, 1510 (11th Cir. 1993).
The plaintiff must provide enough factual allegations to raise a right to relief above the
speculative level, Twombly, 550 U.S. at 555, 127 S.Ct. at 1966, and to indicate the presence of the
required elements, Watts v. Fla. Int’l Univ., 495 F.3d 1289, 1302 (11th Cir. 2007). Conclusory
allegations, unwarranted factual deductions or legal conclusions masquerading as facts will not
prevent dismissal. Davila v. Delta Air Lines, Inc., 326 F.3d 1183, 1185 (11th Cir. 2003).
In Ashcroft v. Iqbal, 556 U.S. 662, 129 S. Ct. 1937, 173 L.Ed.2d 868 (2009), the Supreme
Court explained that a complaint need not contain detailed factual allegations, “but it demands
more than an unadorned, the-defendant-unlawfully-harmed-me accusation. A pleading that offers
labels and conclusions or a formulaic recitation of the elements of a cause of action will not do.
Nor does a complaint suffice if it tenders naked assertions devoid of further factual enhancement.”
Id. at 1949 (internal citations and quotations omitted). “[W]here the well-pleaded facts do not
permit the court to infer more than the mere possibility of misconduct, the complaint has alleged –
but it has not ‘show[n]’ – ‘that the plaintiff is entitled to relief.’” Id. at 1950 (quoting Fed. R.
Civ. P. 8(a)(2)).
III.

Analysis

Before addressing the merits of the claims asserted against them, Castle Law and Phillips
argue that the Third Amended Complaint falls short of the requirements of Fed.R.Civ.P. 8(a),
which requires that such a pleading provide “a short and plain statement of the claim showing that

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the pleader is entitled to relief.” They point out that the Third Amended Complaint is 68 pages
long – twice as long as the Second Amended Complaint – with 238 numbered paragraphs. The
first 100 paragraphs are incorporated into each of the document’s eight counts, despite the fact that
many of them appear to have no relevance to at least some (if not all) of the claims asserted. For
example, roughly four pages are devoted to the formation of Castle Law Group by Keever, Austin,
and Philips, even though that information appears to have no relevance to the question of whether
any of the Defendants tortiously interfered with the Plaintiffs’ contracts or violated the FVPTA.
But while the latest pleading is unnecessarily lengthy and filled with redundancies, the Court finds
it does not quite warrant dismissal as a shotgun pleading or for violation of Rule 8(a).
Castle Law and Phillips also argue that dismissal is required because some of the
Plaintiffs’ allegations in regard to allegedly false advertising are contradicted by some of the
exhibits attached to the Third Amended Complaint. (Doc. 103 at 5-7). Without going through
all of the examples, the Court notes that among other things the Plaintiffs allege, as false or
misleading, communications from Castle Law in which it “guaranteed timeshare owners it would
relieve them of their timeshare obligations within one year to eighteen months”. (Doc. 103 at 6).
In its motion, Castle Law does not dispute having made this statement or the other examples
attributed to it. Instead, it cites to the standard engagement contract between itself and its clients
– attached to the Third Amended Complaint as Exhibit S – which states that
Client understands and agrees that there is no guaranteed result of
the Firm’s services or that Client will recover money or other
property as a result of the Firm’s engagement. Client understands
and agrees that there is no way to determine the time frame in which
the Client’s case will be resolved and that there is no guarantee
regarding the time required to resolve your Claims.
(Doc. 91-19 at 3). However, a truthful disclosure is not necessarily sufficient to overcome the net
impression caused by a misleading communication. See, e.g., FTC v. World Patent Marketing,

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2017 WL 3508639, * 13 (S.D.Fla. Aug. 16, 2017). Even if every Castle Law customer signed an
engagement letter with the quoted language – something that cannot be determined at this stage of
the proceedings – it would not necessarily require dismissal.
A.

Count I – Tortious Interference and Count II – Civil Conspiracy

Austin contends that the surviving tortious interference claim should be dismissed because
the Plaintiffs fail to identify any specific contracts with which the Defendants have allegedly
interfered and fail to allege facts supporting the allegation that he, personally committed such
interference. (Doc. 99 at 2-6). However, this claim survived the previous round of motions to
dismiss, including one filed by Austin himself. No party has pointed to any material change in
the allegations of Count I or the law of tortious interference that would warrant reexamination of
this claim. The same holds true for the civil conspiracy claim asserted in Count II, which also
survived the previous round of motions to dismiss. The current motions will therefore be denied
as to these two counts.
B.

Count III – Violation of Fla. Stat. § 721.121

The Plaintiffs allege that Defendants Resort Relief, Hanson, Castle Marketing and Austin
violated a recordkeeping obligation under Florida’s Vacation Plan and Timesharing Act
(“FVPTA”), Fla. Stat. §§ 721.02-721.98. The Plaintiffs allege that these four Defendants were
“lead dealers,” which is defined by the FVPTA in pertinent part as
any person who sells or otherwise provides a resale service provider
or any other person with personal contact information for five or
more owners of timeshare interests. In the event a lead dealer is not
a natural person, the term shall also include the natural person
providing personal contact information to a resale service provider
or other person on behalf of the lead dealer entity.
Fla. Stat. § 721.05(42). The Act defines “personal contact information” as

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any information that can be used to contact the owner of a specific
timeshare interest, including, but not limited to, the owner’s name,
address, telephone number, and e-mail address.
Fla. Stat. § 721.05(43). The Act requires that lead dealers maintain certain records for five years
after obtaining personal contact information. 2 Fla. Stat. § 721.121(1).
The FVPTA also provides that any party who establishes that a lead dealer wrongfully
obtained or used personal contact information is entitled to recover from the lead dealer “an
amount equal to $1,000 for each owner about whom such personal contact information was
wrongfully obtained or used,” plus attorney’s fees and costs. Fla. Stat. § 721.121(3). In this
case, the Plaintiffs contend that Resort Relief and Hanson provided personal contact information
of Orange Lake Owners to Castle Marketing and Austin, who then provided this personal contact
information to Castle Law. (TAC at 35). They allege that this information was “wrongfully

2

As set forth in Fla. Stat. § 721.121(1), those records are:

(a) The name, home address, work address, home telephone number, work telephone
number, and cellular telephone number of the lead dealer from which the personal contact
information was obtained.
(b) A copy of a current government-issued photographic identification for the lead dealer
from which the personal contact information was obtained, such as a driver license, passport, or
military identification card.
(c) The date, time, and place of the transaction at which the personal contact information
was obtained, along with the amount of consideration paid and a signed receipt from the lead
dealer or copy of a canceled check.
(d) A copy of all pieces of personal contact information obtained in the exact form and
media in which they were received.
(e) If personal contact information was directly researched and assembled by the resale
service provider or lead dealer and not obtained from another lead dealer, a complete written
description of the sources from which personal contact information was obtained, the
methodologies used for researching and assembling it, the items set forth in paragraphs (a) and (b)
for the individuals who performed the work, and the date such work was done.

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obtained” because it was a result of the Defendants’ allegedly deceptive advertising. (TAC at 3536).
The Plaintiffs are not alleging that any personal contact information was misappropriated
from them. Without explicitly saying so, the Plaintiffs are alleging that the info was provided by
the Orange Lake Owners themselves, who had been misled into thinking Castle Law could get
them out of the timeshare contracts. Compare Vacation Club Services, Inc. v. Rodriguez, 2010
WL 1645129 (M.D. Fla. Apr. 22, 2010) (suit involving FVPTA “wrongful obtaining” claim where
plaintiff’s former employee allegedly stole database of plaintiff’s timeshare members, which was
then used by another defendant to solicit timeshare members). 3 Because the information at issue
in the instant case was neither that of the Plaintiffs nor obtained from their possession, Resort
Relief and Austin argue that the Plaintiffs lack standing to proceed under the FVPTA.
A statutory cause of action is presumed to extend only to plaintiffs whose interests fall
within the zone of interests protected by the law invoked. Lexmark Intern., Inc. v. Static Control
Components, Inc., --- U.S. ---, 134 S.Ct. 1377, 1388, 188 L.Ed.2d 392 (2014) (citing Allen v.
Wright, 468 U.S. 737, 751, 104 S.Ct. 3315, 3324, 82 L.Ed.2d 556 (1984). Obviously, the
portions of the FVPTA under which the Plaintiffs now seek to proceed – i.e., the portions
regulating the acquisition, retention, and use of timeshare owners’ personal information – were
intended by the Legislature to protect the privacy interests of those owners. However, the
Plaintiffs argue that by allowing for recovery by any “party” who establishes that personal
information has been wrongfully obtained or used, the Florida Legislature demonstrated an intent
to expand standing for such claims beyond just timeshare owners. (Doc. 112 at 14-15). They

3

No party raised the issue of standing in Vacation Club Services. See id.

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also contend that they have an interest in protecting their timeshare owners “from being solicited
by fraudulent timeshare relief outfits.” (Doc. 112 at 16).
The Court notes that both of the Plaintiffs’ arguments are relevant only to the claim of
wrongfully obtained information under Fla. Stat. § 721.121(3), not to the alleged violations of the
recordkeeping obligation found in Fla. Stat. § 721.121(1). Therefore, the Court finds that the
Plaintiffs lack standing to pursue claims against the Defendants for any alleged failure to follow
the requirements of Fla. Stat. § 721.121(1). As for the $1,000-per-owner claims under Fla. Stat. §
721.121(3), the Plaintiffs’ arguments are not persuasive. The Legislature’s use of the word
“party” rather than, for example, “owner” in that subsection does suggest that recovery was not
intended to be limited to the individuals whose information was misappropriated or misused. But
the Plaintiffs offer nothing to suggest that the Legislature intended to protect the interests of
timeshare developers when it passed Fla. Stat. §721.121(3). Accordingly, the Court finds that the
Plaintiffs also lack standing to pursue claims under that provision of the FVPTA. Count III will
be dismissed with prejudice.
C.

Count IV – FDUTPA

FDUTPA provides in pertinent part that “[u]nfair methods of competition, unconscionable
acts or practices, and unfair or deceptive acts or practices in the conduct of any trade or commerce
are hereby declared unlawful.” Fla. Stat. § 501.204(1). A claim for damages under FDUTPA
has three elements: (1) a deceptive act or unfair practice, (2) causation, and (3) actual damages.
Caribbean Cruise Line, Inc. v. Better Business Bureau of Palm Beach County, Inc., 169 So. 3d
164, 167 (Fla. 4th DCA 2015). In the Second Amended Complaint, the Plaintiffs alleged that the
Defendants violated FDUTPA by (1) soliciting the Orange Lake Owners through ads that deceived
them into thinking that they could unilaterally cancel their timeshare interests; (2) misrepresenting to
the Orange Lake Owners that Castle Law could legally represent them in Florida courts; and (3) falsely

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informing clients who were Orange Lake Owners that their timeshare matters had been resolved.
(Doc. 60 at 28-29). The Court found that the Plaintiffs had failed to state a claim because these
alleged violations would have harmed the Orange Lake Owners, not the Plaintiffs.
In the Third Amended Complaint, the Plaintiffs repeat the second and third allegations
described above – i.e., the misrepresentations as to Castle Law’s ability to represent timeshare owners
in Florida courts and as to whether those owners’ claims had been resolved. As was the case
previously, these acts would cause harm to the owners, not to the Plaintiffs, and do not assist the
Plaintiffs in asserting an FDUTPA claim.
However, the Plaintiffs add new allegations. After repeating their previous allegation about
deceiving timeshare owners as to their ability to unilaterally cancel their contracts, the Plaintiffs allege
that the Defendants’ “advertising and marketing materials … falsely induce [timeshare owners] to stop
making payments to Plaintiffs even though such payments are required by legally enforceable
contracts to which the timeshare owners have no legal excuse or justification not to pay.” (TAC at
39-40). Plaintiffs go on to allege that

Defendants’ false and fraudulent advertising and marketing,
including online, falsely portray timeshare developers and
associations, generally, and Plaintiffs specifically, as systematically
engaging in fraudulent and deceptive conduct to market and sell
timeshare interests. Having targeted Plaintiffs and intentionally and
purposefully tarnished Plaintiffs’ business reputations and images
with their false advertising, Defendants then falsely portray
themselves as saviors, claiming, among the numerous
misrepresentations set forth above, to (1) have obtained relief for
thousands of timeshare owners valued at millions of dollars, (2)
have a success rate of 93%, and (3) guarantee a successful result
within 1 year to 18 months.
(TAC at 40).
The Defendants make several arguments in favor of dismissal of this count. They argue
that dismissal is required because the Plaintiffs are neither (1) consumers nor (2) the Defendants’
competitors. But as the Court noted in its previous order, FDUTPA claims are not limited to

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consumers; and the Defendants have not provided any basis for finding that competitors are the
only parties aside from consumers that can bring FDUTPA claims.
Austin argues that the acts and practices he is alleged to have engaged in were not done “in
the conduct of any trade or commerce” and therefore are not covered by FDUTPA. (Doc. 99 at 89). For purposes of FDUTPA, the term “trade or commerce” is defined as “the advertising,
soliciting, providing, offering, or disturbing, whether by sale, rental, or otherwise, of any good or
service, or any property, whether tangible or intangible, or any other article, commodity, or thing
of value, wherever situated.” Fla. Stat. § 501.203(8). The Plaintiffs never allege that Austin
himself created any of the deceptive ads or directly convinced any Orange Lake Owner to stop
making payments. However, according to the allegations of the Third Amended Complaint,
Austin is one of the “masterminds” of the multifaceted deceptive advertising scheme described in
Count IV. (TAC at 9). For present purposes, that is sufficient to state a claim against him.
Castle Law and Phillips argue that the Lanham Act claims asserted in Count IV and V
must be dismissed, which would require dismissal of the FDUTPA claim. In support, they cite
Global Tech LED, LLC v. Hilumz Int’l Corp., Case No: 2:15-cv-553-FtM-29CM, 2016 WL
3059390 (M.D. Fla. May 31, 2016). It is true that, in that case, Judge Steele found that dismissal
of the Defendant’ Lanham Act counterclaim mandated dismissal of their FDUTPA and Florida
unfair competition counterclaims as well, on the grounds that the legal test for all three claims
were the same. Id. at *3. And it is also true that in this case, the Court finds, infra, that the
Plaintiffs’ Lanham Act claims are due to be dismissed. However, though the legal tests for
FDUTPA and Lanham Act claims might be the same, the allegations in the Third Amended
Complaint are different. In their Lanham Act claims, the Plaintiffs only argue that the
Defendants’ allegedly misleading advertising harmed their reputations; in the FDUTPA claim, in

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addition to the alleged reputational harm, the Plaintiffs contend that the Defendants’ “advertising
and marketing materials … falsely induce [timeshare owners] to stop making payments to Plaintiffs.”
(TAC at 39-40). As discussed below, the Court found that the Lanham Act counts failed to state a
claim because the ads cited by the Plaintiffs could not have caused the reputational harm they allegedly
suffered. But the Defendants did not challenge the allegations in the FDUTPA count that their
advertising and marketing materials could have resulted in a different injury – improper stopping of
payments by Orange Lake Owners. Thus, Count IV does not suffer the same causation problem as
Counts V and VI, and the motion will be denied as to this count.

D.

Count V – False Advertising under the Lanham Act

In Count V, the Plaintiffs allege that Castle Law and Resort Relief violated the Lanham
Act, 15 U.S.C. § 1125(a). The pertinent provision of the Lanham Act provides that
(1) Any person who, on or in connection with any goods or services,
or any container for goods, uses in commerce any word, term, name,
symbol, or device, or any combination thereof, or any false
designation of origin, false or misleading description of fact, or false
or misleading representation of fact, which -…
(B) in commercial advertising or promotion, misrepresents the
nature, characteristics, qualities, or geographic origin of his or her or
another person’s goods, services, or commercial activities,
shall be liable in a civil action by any person who believes that he or
she is or is likely to be damaged by such act.
15 U.S.C. § 1125(a)(1)(B). To state a claim for false advertising in violation of the Lanham Act,
a plaintiff must show that
(1) the … statements were false or misleading; (2) the statements
deceived, or had the capacity to deceive, consumers; (3) the
deception had a material effect on the consumers’ purchasing
decision; (4) the misrepresented service affects interstate commerce;
and (5) [the plaintiff] has been, or likely will be, injured as a result
of the false or misleading statement.

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Duty Free Americas, Inc. v. Estee Lauder Companies, Inc., 7978 F.3d 1248, 1277 (11th Cir. 2015)
(citing Sovereign Military Hospitaller Order v. Fla. Priory of Knights Hospitallers, 702 F.3d
1279, 1294 (11th Cir. 2012)).
In this count, the Plaintiffs allege that Castle Law and Resort Relief made the following
representations of fact – which they describe as “false or misleading” – in their advertising:
a. Castle Law guarantees on its website that it will relieve timeshare
owners of their timeshare obligations within one (1) year to eighteen
(18) months from the date they sign up with Castle Law.
b. Castle Law’s website boasts it has saved its “6000+” customers
“millions of dollars” defending against timeshare developers and
expressly mentions Silverleaf. 4
c. Castle Law’s website also claims that, regardless of whether there
is any legitimate legal basis for the cancellation, “[n]o matter your
reason for wanting to get rid of your timeshare, Castle Law Group
can help.”
d. Resort Relief guarantees it will relieve timeshare owners of their
timeshare obligations if Resort Relief is retained, promising “a 100
percent money back guarantee certificate for an added sense of
security.”
e. Resort Relief claims on its website it has been the “model for
many copycat companies, but they all are missing one thing. Actual
cancellations,” boasting a 93 percent success rate. In the cases “that
we have not been successful, clients get 100 percent of their money
returned to them[.]” Resort Relief’s website expressly mentions
Silverleaf as one of the developers against whom it has achieved
success.
(TAC at 46-47). The Plaintiffs go on to assert that, by way of these five statements, Castle Law
and Resort Relief
substantially injured Plaintiffs’ business reputation by leading
consumers and others in the trade to believe its false statements of

4

Silverleaf Resorts, Inc. is a timeshare company acquired by Orange Lake in 2015.
(TAC at 5).

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fact about its services and by falsely stating, inter alia, that Plaintiffs
are engaged in unlawful or illegal conduct.
(TAC at 47).
As with the FVPTA claims asserted in Count II, these Defendants assert that the Plaintiffs
lack statutory standing to proceed under the Lanham Act. To come within the protected zone of
interests and thereby possess statutory standing, a plaintiff in a suit for false advertising under
Section 1125(a) “must allege an injury to a commercial interest in reputation or sales.” Lexmark,
134 S.Ct. at 1390. In addition, the Lanham Act’s cause of action is limited to plaintiffs whose
injuries are proximately caused by violations of the statute. Id.
For purposes of the Lanham Act, “commercial advertising or promotion” includes (1)
commercial speech (2) by a defendant who is in commercial competition with the plaintiff (3) for
the purpose of influencing consumers to buy defendant’s goods or services, and (4) that is
disseminated sufficiently to the purchasing public to constitute “advertising” or “promotion”
within that industry. Edward Lewis Tobinick, MD v. Novella, 848 F.3d 935, 950 (11th Cir. 2017).
Castle Law contends that the Lanham Act claims should be dismissed because the Defendants are
not in competition with the Plaintiffs. (Doc. 103 at 12-13). However, claims under the Lanham
Act are not limited to competitors. Lexmark, 134 S.Ct. at 1392 (“To be sure, a plaintiff who does
not compete with the defendant will often have a harder time establishing proximate causation.
But a rule categorically prohibiting all suits by noncompetitors would read too much into the Act’s
reference to ‘unfair competition’ in [15 U.S.C.] § 1127.”).
Austin argues that the Plaintiffs have failed to set forth their Lanham Act claims with
enough specificity to satisfy Fed.R.Civ.P. 9(b). (Doc. 99 at 11). In support of his argument that
such specificity is required, he cites to Nutrition Distrib., LLC v. New Health Ventures, LLC, 2017
WL 2547307 (S.D.Cal. June 13, 2017) (holding that heightened pleading standard applies to

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Lanham Act claims that are grounded in fraud). Austin does not cite any cases from within this
Circuit holding that the heightened pleading standard of Rule 9(b) applies to such claims, while
several district courts within the Circuit have declined to apply that standard. See Incarcerated
Entertainment, LLC v. Warner Bros. Pictures, 261 F.Supp.3d 1220, 1226-27 (M.D. Fla. 2017)
(collecting cases). Consistent with the authority cited in Incarcerated Entertainment, the Court
declines to impose a heightened pleading requirement.
Castle Law argues that the Plaintiffs have failed to state a claim because the harm they
claim to have suffered – injury to their reputation caused by the Defendants “leading consumers
and others in the trade to believe [their] false statements of fact about [their] services and by
falsely stating, inter alia, that Plaintiffs are engaged in unlawful or illegal conduct” (TAC at 47) –
could not have happened as a result of the allegedly false statements cited by the Plaintiffs. In
this, Castle Law is correct. Misleading potential clients about Castle Law’s success rate in getting
timeshare owners out of their contracts does not harm the reputation of timeshare developers or
lenders. And none of the cited advertising states that the Plaintiffs are engaged in unlawful or
illegal conduct. Count V will therefore be dismissed without prejudice.
E.

Count VI – Contributory False Advertising under the Lanham Act

In Count VI, the Plaintiffs seek to hold Castle Venture and Castle Marketing, as well as the
individual Defendants alleged to control those entities – i.e., Keever and Austin – liable under the
Lanham Act for contributing to the (allegedly) false advertising that was put at issue in Count V.
(TAC at 49-55). The allegations as to misleading statements and resulting harm are the same in
Count VI as they were in Count V. As such, the harm alleged could not have resulted from the
statements at issue, and Count VI will also be dismissed without prejudice.

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F.

Count VII – Misleading Advertising, Fla. Stat. § 817.41 and
Count VIII – Contributory Misleading Advertising, Fla. Stat. § 817.41

In their last two counts, the Plaintiffs allege that the same statements at issue in Counts V
and VI also violated Section 817.41, Florida Statutes, which makes it unlawful for any person to
make or disseminate (or cause to be made or disseminated) any misleading advertisement before
the general public of the state (or any portion thereof). A consumer party may state a claim under
Fla. Stat. §817.41 by pleading
that the party relied on some identifiable alleged misleading
advertising plus, where appropriate, all of the other elements of the
common law tort of fraud in the inducement, as follows: (a) the
representor made a misrepresentation of a material fact; (b) the
representor knew or should have known of the falsity of the
statement; (c) the representor intended that the representation would
induce another to rely and act on it; and (d) the plaintiff suffered
injury in justifiable reliance on the representation.
Third Party Verification, Inc. v. Signaturelink, Inc., 492 F.Supp.2d 1314, 1322 (M.D. Fla. 2007)
(Conway, J.). Obviously, the Plaintiffs in this case are not consumers and cannot allege that they
relied on any of the Defendants’ advertising. Some courts – including the Signaturelink court –
have held that
when the party alleging misleading advertising is a competitor of the
defendant in selling the goods and services to which the misleading
advertisement relates, an allegation of competition is permitted to
“stand-in” for the element of direct reliance that a consumer is
obligated to plead.
Id. The Plaintiffs attempt to bring themselves within the ambit of Fla. Stat. § 817.41 by alleging
that they are competitors of Castle Law and Resort Relief, in that those two Defendants
advertise to Plaintiffs’ existing client base in order to persuade them
to do business with Castle Law and Resort Relief instead of with
Plaintiffs, and to divert monies due and owing to Plaintiffs instead to
Castle Law and Resort Relief.”
(TAC at 45).

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This argument fails. The Plaintiffs are in the business of getting people into timeshares,
while the Defendants are in the business of getting them out. Though their target audiences
necessarily overlap, the Plaintiffs and Defendants are selling entirely different services. They are
adversaries, not competitors.
As the Plaintiffs are neither consumers nor competitors with respect to the Defendants,
Counts VII and VIII will be dismissed with prejudice.
IV.

Conclusion

In consideration of the foregoing, it is hereby
ORDERED that the motions to dismiss (Doc. 103, 106, 109) are GRANTED IN PART
AND DENIED IN PART as set forth above. Count III is dismissed with prejudice; Counts V
and VI are dismissed without prejudice; and Counts VII and VIII are dismissed with prejudice. In
all other respects, the motions are denied.
DONE and ORDERED in Chambers, Orlando, Florida on March 29, 2018.

Copies furnished to:
Counsel of Record
Unrepresented Party

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