SFX React-Operating LLC v. Eagle Theater Entertainment, LLC et al

Filing 33

ORDER granting Counter Defendant SFX React-Operating LLC's 18 Motion to Dismiss Defendants' 16 Counterclaims. Signed by District Judge Denise Page Hood. (JOwe)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
SFX REACT-OPERATING LLC,
Plaintiff,

CASE NO. 16-13311
HON. DENISE PAGE HOOD

v.
EAGLE THEATER ENTERTAINMENT,
LLC,
BLAIR MCGOWAN,
AMIR DAIZA,
MATTHEW FARRIS
Defendants.
/
ORDER GRANTING COUNTER DEFENDANT SFX REACT-OPERATING
LLC’S MOTION TO DISMISS DEFENDANTS’ COUNTERCLAIMS [#18]
I.

BACKGROUND
A. 16-13288 (Related Case), Procedural Background
On September 12, 2016, Plaintiff React Presents, Inc. (“React”) filed a

Complaint against Defendants Eagle Theater Entertainment, LLC (“Eagle”), Blair
McGowan (“McGowan”), Amir Daiza (“Daiza”), and Matthew Farris (“Farris”)
alleging breach of contract (Count I), fraud (Count II), breach of fiduciary duty
(Count III), violation of the Racketeer Influenced and Corrupt Organizations Act
(“RICO”) (Count IV), and unjust enrichment (Count V). (Doc # 1) Defendants
filed a Motion for a More Definite Statement on November 21, 2016 (Doc # 5),
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which was denied by Magistrate Judge David R. Grand (Doc # 10). Defendants
filed a responsive pleading on February 7, 2017 alleging the following
Counterclaims against React: violation of Section 1 of the Sherman Antitrust Act
(Count I), violation of the Michigan Antitrust Reform Act (Count II), and unjust
enrichment (Count III). (Doc # 11) React filed a Motion to Dismiss Defendants’
Counterclaims on February 28, 2017. (Doc # 13) Defendants filed a Response on
April 7, 2017. (Doc # 19) React filed a Reply on April 21, 2017. (Doc # 20) The
Court held a hearing on the motion on May 3, 2017.
B. 16-13311, Procedural Background
On September 13, 2016, Plaintiff SFX-React Operating LLC (“SFX”) filed a
Complaint against Defendants Eagle Theater Entertainment, LLC (“Eagle”), Blair
McGowan (“McGowan”), Amir Daiza (“Daiza”), and Matthew Farris (“Farris”)
alleging breach of contract (Count I), fraud (Count II), breach of fiduciary duty
(Count III), violation of the Racketeer Influenced and Corrupt Organizations Act
(“RICO”) (Count IV), and unjust enrichment (Count V). (Doc # 1) Defendants
filed a Motion for a More Definite Statement on November 21, 2016 (Doc # 6),
which was denied by Magistrate Judge David R. Grand (Doc # 12). Defendants
filed an amended responsive pleading on February 7, 2017 alleging the following
counterclaims against SFX: violation of Section 1 of the Sherman Antitrust Act
(Count I), violation of the Michigan Antitrust Reform Act (Count II), and unjust
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enrichment (Count III). (Doc # 16) This matter is presently before the Court on
SFX’s Motion to Dismiss Defendants’ Counterclaims, filed on February 28, 2017.
(Doc # 18) Defendants filed a Response on April 7, 2017. (Doc # 22) SFX filed a
Reply on April 21, 2017. (Doc # 23) The Court held a hearing on the motion on
May 3, 2017.
C. Factual Background
React was a club, concert, and festival promotion company. In 2014, SFX
acquired at least some of React’s assets, and Defendants allege that SFX is the
successor of React. SFX is also in the business of promoting clubs, concerts, and
festivals.

Defendants own and operate several concert venues including

Elektricity, a nightclub in Pontiac, Michigan. Elektricity serves as a concert venue
allegedly exclusively for electronic musicians, DJs, and other artists who perform
electronic dance music (“EDM”). Defendant McGowan owns Defendant Eagle
and is its managing member.

Defendant Daiza is responsible for overseeing

Eagle’s operations and overseeing the bookkeeping. Defendant Farris is Eagle’s
bookkeeper.
React began putting on large EDM concerts and festivals in the Chicago area
on or about 2008. The Spring Awakening Music Festival has been held in Chicago
in June of every year since that time. React organized and operated other festivals
featuring EDM artists throughout the Midwest including the Summer Set Music
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Festival (held in Somerset, Wisconsin towards the end of summer each year), the
North Coast Music Festival (held in Chicago in September of each year), and
Freaky Deaky Halloween (held in Chicago in October of each year).
Defendants allege that each of the festivals featured approximately 100
EDM artists. Defendants further allege that when React hired artists to perform at
any of its festivals or concerts, each artist was required to sign an agreement
containing a radius clause. Each radius clause stipulated that the artist would not
play any other shows within a certain radius of the location of React’s event for a
certain period of time. Defendants allege that the radius clauses prohibited artists
from playing anywhere up to within a 500 mile radius of React’s event for periods
of 60, 90, or 120 days prior to and following the date of the event. According to
Defendants, the radius clauses made it nearly impossible for many nationally
recognized EDM artists to play anywhere else in the Midwest, including at
Elektricity and elsewhere in Metro Detroit, because they had played at one or more
of React’s events which occurred throughout the calendar year. Defendants note
several major cities in or near the Midwest which are within a 500 mile radius of
Chicago (Detroit, Buffalo, Kansas City, Huntsville, Cleveland, Toronto, Pittsburg,
St. Louis, Minneapolis, and Thunder Bay). Defendants allege that the purported
purpose of the radius clauses was to protect attendance at React’s events from

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being diminished by fans attending another performance of a featured artist
elsewhere around the same date.
Defendants allege that, in 2012, React became aware that several nationally
recognized EDM artists that had performed at one or more of its events were
receiving offers to play at venues in Metro Detroit. At that time, React contacted
the managers of Eagle and proposed waiving its radius clauses so that the artists
could perform at Eagle in exchange for 50 percent of all profits of any concert
featuring EDM artists within its control, including profits generated from tickets,
merchandise, and concessions. According to Defendants, React threatened that if
Eagle did not agree to the proposal, React would approach other music promoters
in Metro Detroit and attempt to further restrict the EDM market.
At first, React and Eagle orally agreed to split the profits 50-50. React was
responsible for negotiating and contracting with artists, advertising, marketing, and
promoting the concerts. Eagle was responsible for operating the venue and selling
tickets at the box office.

In November 2013, the parties memorialized their

agreement and practices in a Co-Promotion Agreement. Defendants allege that
Eagle was forced to enter into this unfair business arrangement with React
whenever it attempted to book a nationally recognized EDM artist in Metro
Detroit. React and Eagle co-promoted approximately 100 EDM concerts from
2012 until React’s assets were acquired by SFX in April 2014. After each concert,
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Eagle would provide React with a “settlement” document purporting to indicate the
profits generated. The settlements were allegedly prepared by Defendant Farris,
overseen and approved by Defendant Daiza, and approved by Defendant
McGowan. React would review the settlements, and Eagle would then mail a
check to React for their share of the profits.
According to Defendants, in 2014, SFX acquired the Spring Awakening
Music Festival, Summer Set Music Festival, North Coast Music Festival, and
Freaky Deaky Halloween—and SFX continues to operate them each year. SFX
has also organized and operates additional festivals featuring EDM artists in the
Midwest, including Mamby on the Beach (held in Chicago in July of each year)
and Reaction New Year’s Eve (held in Chicago on New Year’s Eve each year).
Defendants allege that each of the festivals feature approximately 100 EDM artists.
Defendants further allege that when SFX hires artists to perform at any of its
festivals or concerts, it requires each artist to sign an agreement containing a radius
clause of the same kind as React’s radius clauses described above. According to
Defendants, the radius clauses make it nearly impossible for many nationally
recognized EDM artists to play anywhere else in the Midwest, including at
Elektricity and elsewhere in Metro Detroit (unless SFX agrees to waive the radius
clauses) because the artists have played at one or more of SFX’s events which
occur throughout the calendar year.
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In April 2014, SFX and Eagle began co-promoting concerts under the same
terms as the prior agreement between React and Eagle. According to Plaintiffs, the
transition was seamless because SFX was operated by the principals of React. In
May 2014, SFX and Eagle entered into a Co-Promotion Agreement, the material
terms of which were identical to the agreement between React and Eagle.
Defendants allege that Eagle is forced to enter into this unfair business
arrangement with SFX whenever it attempts to book a nationally recognized EDM
artist in Metro Detroit.

SFX and Eagle have co-promoted at least 83 EDM

concerts from April 2014 through 2016. After each concert, Eagle provides SFX
with a settlement document purporting to indicate the profits generated. The
settlements have been allegedly prepared by Defendant Farris, overseen and
approved by Defendant Daiza, and approved by Defendant McGowan.

SFX

reviews the settlements, and Eagle then mails a check to SFX for their share of the
profits.
In January 2016, a disgruntled Eagle employee provided React and SFX
with what Plaintiffs allege to be true and accurate accounting records disclosing
that Eagle kept two sets of books showing receipts from the concerts. According
to React and SFX, Eagle’s settlements systematically and fraudulently
underreported the true profits from the concerts. According to SFX, Eagle has also

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withheld payments for at least 16 concerts that SFX and Defendants have copromoted since March 2016.
In February 2016, SFX filed a Petition for Bankruptcy pursuant to chapter
11 of the Bankruptcy Code. In April 2016, Eagle was served with a Notice of Bar
Dates for Filing Proofs of Claim, which was May 17, 2016. A bankruptcy Plan of
Reorganization was confirmed on November 15, 2016. 1
In September 2016, React and SFX brought actions against Defendants
alleging that they suffered hundreds of thousands of dollars in damages because, as
a result of Defendants systematic and fraudulent underreporting, React and SFX
almost always received less from the concerts than the 50 percent of the profits to
which they were entitled under the co-promotion agreements.
In February 2017, Defendants counterclaimed that React and SFX used the
control they gained over EDM artists via the radius clauses as monopolistic
leverage to enter the Metro Detroit EDM market. Defendants further counterclaim

1

SFX, and not the bankruptcy trustee, filed the Complaint in this action. In the bankruptcy
setting, a debtor has an affirmative duty to disclose all of his assets to the bankruptcy court.
Stephenson v. Malloy, 700 F.3d 265, 267 n.2 (6th Cir. 2012) (citing 11 U.S.C. § 521(a)(1)). A
cause of action is an asset that must be scheduled under § 521(a)(1). See Eubanks v. CBSK Fin.
Grp., Inc., 385 F.3d 894, 897 (6th Cir. 2004).
At the hearing on May 3, 2017, the Court asked Counsel for SFX to brief the issue of whether
the bankruptcy trustee is the real party in interest. On May 10, 2017, SFX filed a Supplemental
Brief and attached the Bankruptcy Plan and the Litigation Trust Agreement. (Doc # 24)
Defendants did not file a response. These documents indicate that the Litigation Trustee is aware
of this lawsuit, and that this lawsuit was specifically excluded from the definition of “Litigation
Trust Claim.” Accordingly, the Court is satisfied that SFX is the real party in interest.
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that React was unjustly enriched when it received hundreds of thousands of dollars
from alcohol sales at the concerts.
II.

ANALYSIS
A. Standard of Review
Rule 12(b)(6) of the Federal Rules of Civil Procedure provides for a motion

to dismiss for failure to state a claim upon which relief can be granted. Fed. R.
Civ. P. 12(b)(6). This type of motion tests the legal sufficiency of the plaintiff’s
complaint. Davey v. Tomlinson, 627 F. Supp. 1458, 1463 (E.D. Mich. 1986).
When reviewing a motion to dismiss under Rule 12(b)(6), a court must “construe
the complaint in the light most favorable to the plaintiff, accept its allegations as
true, and draw all reasonable inferences in favor of the plaintiff.” Directv Inc. v.
Treesh, 487 F.3d 471, 476 (6th Cir. 2007). A court, however, need not accept as
true legal conclusions or unwarranted factual inferences.” Id. (quoting Gregory v.
Shelby Cnty., 220 F.3d 443, 446 (6th Cir. 2000)).

“[L]egal conclusions

masquerading as factual allegations will not suffice.” Edison v. State of Tenn.
Dep’t of Children’s Servs., 510 F.3d 631, 634 (6th Cir. 2007). As the Supreme
Court has explained, “a plaintiff’s obligation to provide the ‘grounds’ of his
‘entitle[ment] to relief’ requires more than labels and conclusions, and a formulaic
recitation of the elements of a cause of action will not do. Factual allegations must
be enough to raise a right to relief above the speculative level… .” Bell Atlantic
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Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citations omitted); see LULAC v.
Bresdesen, 500 F.3d 523, 527 (6th Cir. 2007). To survive dismissal, the plaintiff
must offer sufficient factual allegations to make the asserted claim plausible on its
face. Ashcroft v. Iqbal, 556 U.S. 662, 663 (2009). “A claim has facial plausibility
when the pleaded factual content allows the court to draw the reasonable inference
that the defendant is liable for the misconduct alleged.” Id. “The plausibility
standard is not akin to a probability requirement, but it asks for more than a sheer
possibility that a defendant has acted unlawfully. Where a complaint pleads facts
that are merely consistent with a defendant’s liability, it stops short of the line
between possibility and plausibility of entitlement to relief.” Id. at 678 (internal
citations and quotations omitted). The court primarily considers the allegations in
the complaint, although matters of public record, orders, items appearing in the
record of the case, and exhibits attached to the complaint may also be taken into
account. Amini v. Oberlin Coll., 259 F.3d 493, 502 (6th Cir. 2001).
B. Violation of Section 1 of the Sherman Antitrust Act (Count I)
1. Antitrust Counterclaim Against React
a. Statute of Limitations
React first argues that Defendants’ antitrust counterclaim is time-barred
because it accrued in 2012 when React and Defendants entered into their oral copromotion agreement—over four years before Defendants brought their
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Counterclaim. React further argues that Defendants have not alleged a continuing
violation.
Defendants respond that their claim is a continuing claim and not timebarred because the 2012 co-promotion agreement is not the overt act that offended
the Sherman Act and injured the EDM market, but rather the repeated performance
contracts with EDM artists that contained radius clauses.
“Any action to enforce any cause of action under [the Sherman Antitrust
Act] shall be forever barred unless commenced within four years after the cause of
action accrued.” 15 U.S.C. § 15b. Accrual generally occurs and the limitation
period commences “when a defendant commits an act that injures a plaintiff’s
business.” Zenith Radio Corp. v. Hazeltine Research, Inc., 401 U.S. 321, 338
(1971). “[W]hen a continuing antitrust violation is alleged, a cause of action
accrues each time a plaintiff is injured by an act of the defendants.” Peck v.
General Motors Corp., 894 F.2d 844, 849 (6th Cir. 1990) (internal quotations
omitted). However, “even when a plaintiff alleges a continuing violation, an overt
act by the defendant is required to restart the statute of limitations and the statute
runs from the last overt act.” Id. (internal quotations omitted).
An overt act that restarts the statute of limitations is characterized by
two elements: (1) it must be a new and independent act that is not
merely a reaffirmation of a previous act; and (2) it must inflict new
and accumulating injury on the plaintiff. Acts that simply reflect or
implement a prior refusal to deal, or acts that are merely unabated
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inertial consequences of a single act, do not restart the statute of
limitations.
DXS, Inc. v. Siemens Med. Sys., Inc., 100 F.3d 462, 467-68 (6th Cir. 1996).
In this case, viewing the facts in the light most favorable to Defendants and
drawing all reasonable inferences in their favor, each performance agreement
between React and the EDM artists that played at React’s events contained a radius
clause. React entered into contracts with hundreds of EDM artists, and these
contracts expired in less than a year. Each year, React entered into virtually
identical contracts with hundreds of EDM artists, as it operated several annual
festivals that took place each year, until React was acquired by SFX in 2014.
Based on React’s Complaint, as admitted in paragraph 20 of Defendants’ Answer,
React and Defendants co-promoted concerts in 2014. It can be inferred from the
2014 co-promotions that the artists playing at those concerts were subject to radius
clauses that React had to agree to waive via the co-promotion agreement.
Defendants allege that the radius clauses made it nearly impossible for many
nationally recognized EDM artists to play anywhere else in the Midwest, including
at Elektricity and elsewhere in Metro Detroit (unless React agreed to waive the
radius clauses) because the artists had played at one or more of React’s events
which occur throughout the calendar year.
The Court finds that the alleged violations of the Sherman Act are the
individual performance contracts containing radius clauses between React and the
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EDM artists. It was not the co-promotion agreement that limited Defendants’
ability to book EDM artists to play at their venues, and the co-promotion
agreement contained no radius clause.

The Court further finds that each

performance contract between React and the EDM artists was an overt act by React
that restarted the statute of limitations because each performance contract was a
new and independent act that allegedly inflicted new and accumulating injury on
Defendants’ business as well as on the EDM market in Metro Detroit.
Accordingly, Defendants’ cause of action accrued each time they were allegedly
injured by React’s performance contracts with EDM artists containing radius
clauses. The alleged violation was continuing as late as 2014, so Defendants’
Counterclaim filed in February 2017 is within the four-year statute of limitations
and not time-barred.
React next argues that Defendants’ antitrust counterclaim should be
dismissed because Defendants have not alleged a per se violation of the Sherman
Act and have failed to plead sufficient allegations to satisfy the rule of reason test.
The Court examines each of these arguments in turn.
b. Per Se Violation of the Sherman Antitrust Act
React argues that Defendants have not alleged a per se violation of the
Sherman Act because:

(1) the alleged radius clauses in React’s performance

contracts are vertical restraints; (2) prior cases have not established the
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anticompetitive effects of a sufficiently similar business practice; (3) other courts
have held that radius clauses are not per se violations; and (4) the alleged radius
clauses do not completely lack redeeming competitive rationales.
Defendants respond that React’s actions were unreasonable per se because:
(1) they operated to foreclose competitors form a substantial market; and (2) they
resulted in control of the supply side of the EDM market in Metro Detroit.
Section 1 of the Sherman Antitrust Act provides that, “[e]very contract,
combination in the form of trust or otherwise, or conspiracy, in restraint of trade or
commerce among the several States, or with foreign nations, is declared to be
illegal.” 15 U.S.C. § 1. The Supreme Court has held that Congress intended to
prohibit only “unreasonable” restraints of trade.

Id. at 342-43.

In order to

establish a violation of Section 1 of the Sherman Antitrust Act, three elements
must be met:

(1) an agreement, (2) affecting interstate commerce, that (3)

unreasonably restrains trade. White & White, Inc. v. Am. Hosp. Supply Corp., 723
F.2d 495, 504 (6th Cir. 1983). Generally, restraints of trade are analyzed under the
“rule of reason.” State Oil Co. v. Khan, 522 U.S. 3, 10 (1997).
There are some restraints, however, that are deemed unlawful per se because
they “have such predictable and pernicious anticompetitive effects, and such
limited potential for procompetitive benefit.” Id. “Per se treatment is appropriate
once experience with a particular kind of restraint enables the Court to predict with
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confidence that the rule of reason will condemn it.”

Id. (internal quotations

omitted). The per se rule is applied when the restraint “facially appears to be one
that would always or almost always tend to restrict competition and decrease
output.” In re Cardizem CD Antitrust Litig., 332 F.3d 896, 906 (6th Cir. 2003)
(internal quotations omitted).

The per se approach applies a conclusive

presumption of illegality to certain types of agreements and no consideration is
given to the intent behind the restraint, to any claimed pro-competitive
justifications, or to the restraint’s actual effect on competition. Id.
In this case, the alleged radius clauses at issue are vertical restraints because
they are agreements between React (the promoter) and the EDM artists—actors at
different levels of the market structure. See Care Heating & Cooling, Inc. v. Am.
Standard, Inc., 427 F.3d 1008, 1013 (6th Cir. 2005).
Unlike many horizontal agreements [among competitors at the same
level of market structure], such as group boycotts, price cartels, and
monopolies, that are entirely devoid of redeeming competitive value
and therefore present “clear cut cases,” vertical restrictions possess the
“redeeming virtue” of promoting interbrand competition . . . . Thus,
where a plaintiff alleges a vertical restraint of trade, the rule of reason
applies.
Id. Defendants do not allege any horizontal agreement. Defendants do not allege
that React’s conduct involves horizontal price fixing, group boycotts, bid-rigging,
or vertical minimum price distribution restraints.

15

React correctly notes that Defendants have failed to identify any case in
which radius clauses between a promoter and artists like the ones at issue here
were held to violate antitrust law. “Except where courts have already carved out
certain categories of offenses as proscribed per se, there is an automatic
presumption in favor of the rule of reason standard.” Expert Masonry, Inc. v.
Boone Cnty., Ky., 440 F.3d 336, 343 (6th Cir. 2006) (internal quotations omitted).
Applying the per se standard “should be done reluctantly and infrequently,
informed by other courts’ review of the same type of restraint, and only when the
rule of reason would likely justify the same result.” In re Southeastern Milk
Antitrust Litig., 739 F.3d 262, 271 (6th Cir. 2014).
The Court finds that Defendants have not alleged facts that would place this
case into one of the limited categories that have been collectively deemed per se
anticompetitive. The economics of the radius clauses at issue do not on their face
require a presumption of anti-competitiveness. See It’s My Party, Inc. v. Live
Nation, Inc., 88 F. Supp. 3d 475, 502 (noting that, “while not per se illegal,”
exclusive dealing arrangements, such as contracts between a national promoter and
artists requiring the artists to work only with the national promoter via exclusivity
clauses or broad radius clauses, may be an improper means of acquiring or
maintaining a monopoly power) (emphasis added).

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c. Quick Look Analysis
Defendants argue that the Court should find that React’s conduct was
unlawful under the “quick-look” analysis, which would not require an analysis of
the surrounding market.
The Supreme Court has explained the quick-look analysis as follows.
In Nat’l Collegiate Athletic Ass’n v. Bd. of Regents of Univ. of Okla.,
468 U.S. 85 (1984), we held that a “naked restraint on price and
output requires some competitive justification even in the absence of a
detailed market analysis.” Id. at 110. Elsewhere, we held that “no
elaborate industry analysis is required to demonstrate the
anticompetitive character of” horizontal agreements among
competitors to refuse to discuss prices, Nat’l Soc. of Prof’l Engineers
v. United States, 435 U.S. 679, 692 (1978), or to withhold a particular
desired service, FTC v. Indiana Fed’n of Dentists, 476 U.S. 447, 459
(1986) (quoting Nat’l Soc. of Prof’l Engineers, supra, at 692). In each
of these cases, which have formed the basis for what has come to be
called abbreviated or “quick-look” analysis under the rule of reason,
an observer with even a rudimentary understanding of economics
could conclude that the arrangements in question would have an
anticompetitive effect on customers and markets. In Nat’l Collegiate
Athletic Ass’n, the league’s television plan expressly limited output
(the number of games that could be televised) and fixed a minimum
price. 468 U.S. at 99-100. In Nat’l Soc. of Prof’l Engineers, the
restraint was “an absolute ban on competitive bidding.” 435 U.S. at
692. In Indiana Fed’n of Dentists, the restraint was “a horizontal
agreement among the participating dentists to withhold from their
customers a particular service that they desire.” 476 U.S. at 459. As
in such cases, quick-look analysis carries the day when the great
likelihood of anticompetitive effects can easily be ascertained. See
Law v. Nat’l Collegiate Athletic Ass’n, 134 F.3d 1010, 1020 (10th Cir.
1998) (explaining that quick-look analysis applies “where a practice
has obvious anticompetitive effects”); Chicago Prof’l Sports Ltd.
Partnership v. Nat’l Basketball Ass’n, 961 F.2d 667, 674-76 (7th Cir.
1992) (finding quick-look analysis adequate after assessing and
rejecting logic of proffered procompetitive justifications) . . . .
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California Dental Ass’n v. F.T.C., 526 U.S. 756, 769–70 (1999) (some citations
omitted).
In this case, the Court finds that the likelihood of anticompetitive effects of
the radius clauses at issue is comparably not as obvious or as easily ascertained as
with the restraints cited above.

Likewise, the procompetitive justification

proffered by React – to protect attendance at React’s events from being diminished
by fans attending another performance of a featured artist elsewhere near the same
date and location – is not as easily rejected. The Court next turns to the rule of
reason analysis.
d. Rule of Reason
“Unlike the per se rule, the rule of reason utilizes a burden-shifting
framework that allows the court to analyze the history of the restraint and the
restraint’s effect on competition.” In re Southeastern Milk Antitrust Litig., 739
F.3d at 271-72. The plaintiff must first establish a prima facie case by showing:
(1) that the defendant contracted, combined or conspired; (2) that the scheme
produced anticompetitive effects; (3) that the scheme affected relevant product and
geographic markets; (4) that the scheme’s goal and related conduct was illegal; and
(5) that the restraint was the proximate cause of plaintiff’s antitrust injury. Id. at
272. If the plaintiff establishes a prima facie case, the burden then shifts to the
defendant to produce evidence that the restraint at issue has “procompetitive
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effects” that are sufficient to justify the otherwise anticompetitive injuries. Id. If
the defendant meets this burden, the plaintiff must then show that any legitimate
objectives can be achieved in a substantially less restrictive manner.

Id. An

agreement violates the rule of reason if it “may suppress or even destroy
competition,” rather than promote competition. Am. Needle, Inc. v. Nat’l Football
League, 500 U.S. 183, 203 n.10 (2010), quoting Bd. of Trade of Chicago v. United
States, 246 U.S. 231, 238 (1918).
React argues that the antitrust counterclaim should be dismissed because
Defendants have failed to establish the first, second, third, and fifth elements of
their prima facie case. The Court examines the elements at issue in turn.
i. Contracted, Combined, or Conspired
React first argues that Defendants have failed to establish the first element of
their prima facie case. According to React, Defendants cannot rely on the copromotion agreement between React and Eagle because they were a party to that
agreement.

React also argues that Defendants’ allegations regarding the

performance contracts between React and EDM artists containing the radius
clauses are completely devoid of detail.
As discussed above, the alleged violations of the Sherman Antitrust Act are
the individual performance contracts containing radius clauses between React and
the EDM artists, not Eagle’s co-promotion agreement with React. Construing the
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Counterclaim in the light most favorable to Defendants, Defendants have alleged
that React required hundreds of EDM artists to sign radius clauses in order to play
at React’s events throughout the year. These radius clauses restricted the artists’
ability to play any other shows within up to a 500-mile radius of the location of
React’s event for up to 120 days before and after the event. The Court finds that
Defendants have sufficiently alleged that React contracted with the EDM artists,
satisfying the first element of their prima facie case at this stage.
ii. Adverse Competitive Effect
React next argues that Defendants cannot establish the second element of
their prima facie case because they have only alleged individual injury, and have
failed to allege any adverse anticompetitive effect on the market as a whole. React
notes that the Counterclaim lacks details regarding the alleged radius clauses.
“[B]ecause the Sherman Act was intended to protect competition and the
market as a whole, not individual competitors, the foundation of an antitrust claim
is the alleged adverse effect on the market.” Care Heating, 427 F.3d at 1014
(internal citations omitted).
Defendants’ Counterclaim alleges that React hired hundreds of EDM artists
to play at its various events throughout the year and required them to agree to
radius clauses in their performance contracts restricting their ability to perform
within up to 500 miles of React’s events for up to 120 days before and after the
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events. According to the Counterclaim, most of React’s music events took place in
Chicago, and the Metro Detroit area is well within a 500 mile radius of Chicago.
Defendants further allege that many of the nationally recognized EDM artists that
Defendants book to play at Elektricity and elsewhere in Metro Detroit were subject
to a radius clause in their performance contract(s) with React for one or more of
React’s events. Defendants allege that Eagle was forced to enter into the copromotion agreement with React and give React half of any and all profits
generated from EDM concerts in order to be able to book nationally recognized
EMD artists that were subject to the radius clauses which React would not
otherwise waive.
According to the Counterclaim, the performance contracts between React
and EDM artists unreasonably restricted price and cost of competition among
EDM concert venues by limiting or preventing EDM concert venues in
competition with React from obtaining talent and competitive prices/costs for
EDM concerts in Metro Detroit.

The performance contracts unreasonably

restricted the ability of EDM concert venues in Metro Detroit to offer concerts to
EDM fans whatsoever unless subjected to React’s co-promotion agreements
demanding half of all the profits. The performance contracts further unreasonably
limited entry and expansion of competitors or potential competitors of React in the
EDM concert market in Metro Detroit. The Counterclaim also alleges that the
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performance contracts raised the costs to produce EDM concerts for competitors of
React and, in turn, the prices of EDM concert tickets for EDM fans in Metro
Detroit.
Based on the allegations in the Counterclaim, the Court finds that it is
plausible that the radius clauses in the performance contracts have anticompetitive
effects on the EDM market in Metro Detroit, and that Defendants have satisfied the
second element of their prima facie case at this stage.
iii. Product Market
React argues that Defendants have failed to sufficiently identify the relevant
product market because the Counterclaim contains no allegations regarding React’s
competitors. React further argues that Defendants have failed to allege facts to
support its conclusion that the market is limited to EDM music.
Defendants respond that the relevant product market is EDM performances
by nationally recognized EDM artists that can fill larger venues. Defendants argue
that the product market should be defined in terms of EDM music and not in terms
of music as a whole because these products are not interchangeable.
Relevant product or geographic markets are sufficiently alleged as long as
the allegations in the complaint bear a “rational relation to the methodology courts
prescribe to define a market.” Todd v. Exxon Corp., 275 F.3d 191, 199-200 (2d
Cir. 2001). Courts hesitate to grant motions to dismiss for failure to plead a
22

relevant product market because market definition is a fact-intensive inquiry into
the commercial realities faced by the consumers. Id. at 199-200; Eastman Kodak
Co. v. Image Tech. Servs., Inc., 504 U.S. 451, 467 (1992). A product market
consists of products that have “reasonable interchangeability.” Spirit Airlines, Inc.
v. Northwest Airlines, Inc., 431 F.3d 917, 933 (6th Cir. 2005).
The definition of relevant market, therefore, turns on a determination
of available substitutes. . . . Reasonable interchangeability . . .
includes analysis of cross-elasticity of demand. Demand for a product
is said to be “elastic” if an increase in the price causes less of the
product to be purchased. There is said to be “cross-elasticity” of
demand” between two products if rising prices for product A cause
consumers to switch to product B. . . .
A different product market may be founded upon a distinction
between products in degree as opposed to a distinction between
products in kind. Within the universe of a product market, therefore,
there may exist a submarket—a portion of the product market that, for
purposes of the specific antitrust case, is considered a separate market.
The boundaries of an antitrust submarket are determined by
examining practical indicia, such as (1) industry and public
recognition of the submarket as a separate economic entity and (2) the
product’s unique and distinct uses, qualities, price, price sensitivity,
production facilities, consumers, and vendors.
Nobody In Particular Presents, Inc. v. Clear Channel Commc’ns, Inc., 311 F.
Supp. 2d 1048, 1075, 1081 (D. Colo. 2004).
According to the Counterclaim, Elektricity is a concert venue exclusively for
EDM artists, and featuring concerts and performances by nationally recognized
EDM artists is essential to Defendants’ business. The Counterclaim alleges that
each of React’s annual festivals featured as many as 100 EDM artists, and React
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prohibited a substantial number of nationally-recognized EDM artists from
performing in Metro Detroit unless React obtained half of any and all profits.
React allegedly limited or prevented EDM concert venues in competition with
React from obtaining talent and competitive prices/costs for EDM concerts in
Metro Detroit, and unreasonably restricted the ability of EDM concert venues in
Metro Detroit to offer concerts to EDM fans whatsoever unless subjected to
React’s co-promotion agreements demanding half of all the profits.

The

Counterclaim alleges that React unreasonably limited entry and expansion of
competitors or potential competitors of React in the EDM concert market in Metro
Detroit.
Viewing the facts in the light most favorable to Defendants and drawing all
reasonable inferences in their favor, EDM performances by nationally recognized
EDM artists are recognized by the industry and concert goers as a unique
submarket with distinct qualities. Some venues, such as Elektricity, play EDM
music exclusively and attract a crowd that specifically seeks out EDM music.
Additionally, nationally recognized EDM artists work only with certain EDM
promoters, such as React and Defendants, and perform only at certain venues and
events, such as the music festivals produced and operated by React. As the court
observed in Nobody In Particular Presents, just as “rock concerts have a
distinctive customer base, common sense supports [the] assertion that consumers
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do not view non-rock concerts as substitutes for rock concerts.” 311 F. Supp. 2d at
1084. The same could be said of EDM concerts versus non-EDM concerts.
Based on the allegations in the Counterclaim, the Court finds that
Defendants have plausibly alleged a product market, EDM performances by
nationally recognized EDM artists, and Defendants are not required to allege a
market-by-market analysis at the pleading stage.
iv. Geographic Market
React argues that Defendants have failed to sufficiently identify the relevant
geographic market. React notes that the Counterclaim contains no allegations
regarding the geographic area from which React, Defendants, or other allegedly
affected venues draw customers.
Geographic markets need not be alleged or proven with “scientific
precision,” nor defined “by metes and bounds as a surveyor would lay off a plot of
ground.” United States v. Conn. Nat’l Bank, 418 U.S. 656, 669 (1974); United
States v. Pabst Brewing Co., 384 U.S. 546, 549 (1966); White & White, 723 F.2d at
503. The complaint need only present sufficient information to plausibly suggest
the contours of the relevant geographic market. Jacob v. Tempur-Pedic Int’l, Inc.,
626 F.3d 1327, 1336 (11th Cir. 2010).

Because convenience of location is

essential to effective competition in most service industries, geographic markets
are analyzed by using a “localized approach,” and a metropolitan area may be
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considered an appropriate geographic market. See Conn. Nat’l Bank, 418 U.S. at
668-70; United States v. Marine Bancorporation, Inc., 418 U.S. 602, 619 (1974).
According to the Counterclaim, Elektricity is a nightclub in Pontiac,
Michigan. Defendants are in the business of booking EDM artists to play at
Elektricity and elsewhere in Metro Detroit, including at Masonic Temple Theatre
(located in Detroit, Michigan), Populux (located in Detroit, Michigan), Majestic
Theatre (located in Detroit, Michigan), Russell Industrial Center (located in
Detroit, Michigan), and Lot 9 (located in Pontiac, Michigan). React and Eagle copromoted approximately 200 EDM concerts in the aforementioned venues, all
located in the Metro Detroit area, pursuant to their co-promotion agreement
waiving the radius clauses in the performance contracts in exchange for half of any
all profits. Given that the nightclub and concert industry is a service industry in
which convenience of location is an important driver, one can reasonably infer that
most patrons / concert goers at the aforementioned venues came from the Metro
Detroit area.
Based on the allegations in the Counterclaim, the Court finds that
Defendants have at this stage plausibly and sufficiently alleged a localized
geographic market, Metro Detroit.

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v. Market Power
React argues that the antitrust counterclaim should be dismissed because
Defendants have failed to allege that React had sufficient market power.
To sufficiently plead market power, the complaint must “provide sufficient
factual predicate to support its allegations that the defendants enjoy market power
in the relevant market.” Found. for Interior Design v. Savannah Coll., 244 F.3d
521, 530-31 (6th Cir. 2001).

“Market power is normally inferred from the

possession of a substantial percentage of the sales in a market carefully defined in
terms of both product and geography.” Mfrs. Supply Co. v. Minnesota Mining &
Mfg. Co., 688 F. Supp. 303, 307 (W.D. Mich. 1988) (internal quotations omitted).
Market power may also be inferred from the possession of substantial control of
the supply side of a unique product market. See Nat’l Collegiate Athletic Ass’n v.
Bd. of Regents of Univ. of Okla., 468 U.S. 85, 112 (1984).
According to the Counterclaim, React produced four music festivals per year
featuring as many as 100 EDM artists at each festival. Defendants allege that
virtually every nationally recognized EDM artist performed at one or more of
React’s events each year. The Counterclaim further alleges that React required the
EDM artists it hired to agree to radius clauses in their performance contracts
restricting their ability to perform within up to 500 miles of React’s events for up
to 120 days before and after the events. According to the Counterclaim, most of
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React’s music events took place in Chicago, and the Metro Detroit area is well
within a 500 mile radius of Chicago. Defendants allege that many nationally
recognized EDM artists that Defendants book to play at Elektricity and elsewhere
in Metro Detroit were subject to radius clauses in their performance contract(s)
with React for one or more of React’s events. Defendants allege that they were
forced to enter into the co-promotion agreement with React and to give React half
of any and all profits generated from EDM concerts in order to be able to book
nationally recognized EMD artists that were subject to the radius clauses which
React would not otherwise waive.

One can reasonably infer that other local

promoters attempting to book nationally recognized EDM artists at venues in
Metro Detroit were faced the same predicament as Defendants.
Viewing the facts in the light most favorable to Defendants, React had
substantial control of the supply side of EDM performances by nationally
recognized EDM artists in Metro Detroit. React had control over where and when
many nationally recognized EDM artists could perform pursuant to the radius
clauses (which often encompassed the Metro Detroit area due to its proximity to
Chicago). React also had control over whether or not to waive the radius clauses
for local promoters such as Defendants, and under which circumstances to do so if
at all. The Court finds that the Counterclaim alleges facts from which one can

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infer that React had market power over EDM performances by nationally
recognized EDM artists in Metro Detroit.
Having found that Defendants have plausibly alleged a product market, a
geographic market, and market power in the relevant market, the Court concludes
that Defendants have satisfied the third element of their prima facie case at this
stage.
vi. Proximate Cause of Antitrust Injury
React’s last argument for dismissal of the antitrust counterclaim is that
Defendants have failed to allege that the radius clauses were the proximate cause
of Defendants’ alleged antitrust injury. React argues that Defendants have failed to
allege an antitrust injury because they have failed to allege that any entity, person,
or consumer other than Eagle suffered adverse effects as a result of the radius
clauses.
This argument fails for the same reasons already discussed above. Again,
“because the Sherman Act was intended to protect competition and the market as a
whole, not individual competitors, the foundation of an antitrust claim is the
alleged adverse effect on the market.” Care Heating, 427 F.3d at 1014 (internal
citations omitted).
According to the Counterclaim, the performance contracts between React
and EDM artists containing the radius clauses unreasonably restricted price and
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cost of competition among EDM concert venues by limiting or preventing EDM
concert venues in competition with React from obtaining talent and competitive
prices/costs for EDM concerts in Metro Detroit.

The performance contracts

unreasonably restricted the ability of EDM concert venues in Metro Detroit to offer
concerts to EDM fans whatsoever unless subjected to React’s co-promotion
agreements demanding half of all the profits. The performance contracts further
unreasonably limited entry and expansion of competitors or potential competitors
of React in the EDM concert market in Metro Detroit. The Counterclaim also
alleges that the performance contracts raised the costs to produce EDM concerts
for competitors of React and, in turn, the prices of EDM concert tickets for EDM
fans in Metro Detroit.
The Court finds that Defendants have sufficiently and plausibly alleged that
React’s conduct had an adverse effect on competition, output, and prices in the
EDM performance market in Metro Detroit. Defendants have satisfied the fifth
element of their prima facie case at this stage.
Having found that Defendants have sufficiently established the first, second,
third, and fifth elements of their prima facie case, each of React’s arguments fail,
and the Court denies React’s motion to dismiss the antitrust counterclaim.

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2. Antitrust Counterclaim Against SFX
a. Successor Liability
Defendants assert in their counterclaim that SFX acquired React, and that
SFX is React’s successor. SFX argues that Defendant’s antitrust counterclaims
should be dismissed because Defendants failed to allege any factual support for
their assertion that SFX is React’s successor. Defendants did not respond to this
argument in their Response.
Michigan follows the traditional rule of nonliability for corporate successors
who acquire a predecessor through the purchase of assets.

Foster v. Cone-

Blanchard Mach. Co., 460 Mich. 696, 702 (1999).
However, Michigan recognizes five narrow exceptions to the
traditional rule of nonliability: (1) where there is an express or
implied assumption of liability; (2) where the transaction amounts to a
consolidation or merger; (3) where the transaction was fraudulent; (4)
where some elements of a purchase in good faith were lacking, or
where the transfer was without consideration and the creditors of the
transferor were not provided for; or (5) where the transferee
corporation was a mere continuation or reincarnation of the old
corporation.
Stramaglia v. United States, 377 F. App’x 472, 475 (6th Cir. 2010).
A review of the Counterclaim shows that Defendants have failed to allege
any factual support for their assertion that SFX is React’s successor. To the extent
that Defendants seek to hold SFX liable for conduct on the part of React prior to
April 2014 based on successor liability, such counterclaim is dismissed.
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b. SFX’s Bankruptcy Reorganization
SFX next argues that Defendants’ antitrust counterclaim is barred by SFX’s
bankruptcy reorganization.
Defendants state in their Response that, due to SFX’s bankruptcy discharge,
Defendants concede that they are not pursuing any antitrust counterclaims prior to
November 15, 2016. (Doc # 22, Pg ID 196)
As the Sixth Circuit has explained,
By operation of the Bankruptcy Code, confirmation of a
reorganization plan “discharges the debtor from any debt that arose
before the date of ... confirmation.” 11 U.S.C. § 1141(d). Section
101(12) of the Bankruptcy Code defines a “debt” as “liability on a
claim.” Pursuant to 11 U.S.C. § 101(5), a “claim” includes a “right to
payment, whether or not such right is reduced to judgment, liquidated,
unliquidated, fixed, contingent, matured, [or] unmatured.”
In re Travel Agent Comm’n Antitrust Litig., 583 F.3d 896, 901 (6th Cir. 2009).
In February 2016, SFX filed a Petition for Bankruptcy pursuant to chapter
11 of the Bankruptcy Code. (Doc # 18-2) In April 2016, Eagle was served with a
Notice of Bar Dates for Filing Proofs of Claim, which was May 17, 2016. (Doc #
18-3; Doc # 18-4)

A bankruptcy Plan of Reorganization was confirmed on

November 15, 2016. (Doc # 18-5) Accordingly, the Court dismisses any antitrust
counterclaim against SFX prior to November 15, 2016.
However, “a successfully reorganized debtor under Chapter 11 of the
Bankruptcy Code is liable for any independent conduct that arises after the
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confirmation of its bankruptcy plan. In short, the debtor gets a fresh start, but that
does not provide a continuing license to violate the law.” In re Travel Agent
Comm’n Antitrust Litig., 583 F.3d at 902. Defendants argue that the conduct
complained of on the part of SFX continues into the present, including after the
bankruptcy confirmation date.
Although the Counterclaim may allege a continuing violation, there are no
specific allegations regarding any co-promotions between SFX and Defendants, or
any attempted co-promotions or bookings of EDM artists on the part of Defendants
or any competitor of SFX in Metro Detroit, after the bankruptcy confirmation date.
The Counterclaim contains no allegations regarding the effective date of the
bankruptcy plan, the types of claims that may or may not go forward under the
bankruptcy plan, or who may bring or may be enjoined from bringing claims
against SFX under the bankruptcy plan. Under these circumstances, the Court
finds that Defendants have failed to satisfy their obligation to provide the grounds
of their entitlement to relief as required. The Court grants SFX’s motion to dismiss
the antitrust counterclaim against SFX.
C. Violation of the Michigan Antitrust Reform Act (Count II)
The Michigan Antitrust Reform Act (“MARA”) provides that “[i]t is the
intent of the legislature that in construing all sections of this act, the courts shall
give due deference to interpretations given by the federal courts to comparable
33

antitrust statutes, including, without limitation, the doctrine of per se violations and
the rule of reason.” M.C.L. § 445.784(2). In analyzing MARA claims, both state
and federal courts rely on federal case law interpreting the Sherman Antitrust Act.
See, e.g., Partner & Partner, Inc. v. ExxonMobil Oil Corp., No. 05-CV-74499,
2008 WL 896052, at *6 (E.D. Mich. Mar. 31, 2008), aff’d, 326 F. App’x 892 (6th
Cir. 2009); Blair v. Checker Cab Co., 219 Mich. App. 667, 675 (1996).
React, SFX, and Defendants all rely on the same arguments analyzed above
to support their positions as to the MARA counterclaims. Accordingly, for the
same reasons set forth above, the Court denies React’s motion to dismiss the
MARA counterclaim and grants SFX’s motion to dismiss the MARA
counterclaim.
D. Unjust Enrichment (Count III)
1. Unjust Enrichment Counterclaim Against React
React argues that the unjust enrichment counterclaim should be dismissed
because an express contract already addresses the pertinent subject matter,
proceeds from alcohol sales. React further argues that Defendants have failed to
allege that there was anything unjust about React’s receipt of payments under the
co-promotion agreement.

Lastly, React argues that even if the co-promotion

agreement is illegal, the law leaves the parties where it finds them, and Defendants
cannot recover.
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Defendants respond that there is no express contract regarding the sharing of
alcohol proceeds. Defendants argue that React’s receipt of payments for alcohol
proceeds was unjust because they were not entitled to such payments under
Michigan law, and because the payments were the result of coercion and duress.
Defendants further argue that React’s alleged violation of the Sherman Antitrust
Act is a policy reason sufficient to justify an exception to the general rule against
enforcement of an illegal contract.
To establish a claim for unjust enrichment in Michigan, a plaintiff must
show: (1) receipt of a benefit by the defendant from the plaintiff, and (2) an
inequity resulting to the plaintiff because of the defendant’s retention of the
benefit. Belle Isle Grill Corp. v. Detroit, 256 Mich. App. 463, 478 (2003). “If
both elements are established, Michigan courts will then imply a contract to
prevent unjust enrichment. However, a contract will not be implied where an
express contract governing the same subject matter exists.” Joseph v. JPMorgan
Chase Bank, Nat’l Ass’n, No. 12-12777, 2013 WL 228010 (E.D. Mich. Jan. 22,
2013). “Where a contract governs the relationship of the parties, a cause of action
for unjust enrichment will not be recognized.” E3A v. Bank of America, N.A., No.
13-10277, 2013 WL 1499560, at *4 (E.D. Mich. Apr. 11, 2013).
The relationship between React and Eagle was governed by an express
contract, the co-promotion agreement. (Doc # 1-1) Under the agreement’s express
35

terms, the parties were to split net profits or net losses from all “adjusted gross
receipts” less all “approved show costs.” “Adjusted gross receipts” was defined to
include “concessions commissions.” “Concessions,” however, was not defined in
the agreement. The agreement also included the following provision: “Each Party
hereby represents, warrants and agrees that . . . it shall perform its activities under
this Agreement in accordance with all applicable Federal, state and local laws and
regulations.”
The sharing of alcohol proceeds was part of the subject matter governed by
the express agreement between React and Eagle.

The agreement expressly

provided which proceeds the parties were to split and the manner if splitting. The
agreement also expressly excluded Defendants’ sharing of alcohol proceeds with
React because React’s name did not appear on the license to use or benefit from
the liquor license as required by Michigan law, 2 and both parties expressly agreed
to perform under the agreement in accordance with Michigan law. The Court
declines to imply another contract between React and Defendants under an unjust
enrichment theory, as that would circumvent the express intent of the parties to
split concessions commissions in accordance with Michigan law.

2

See Mich. Admin. R. 436.1041; M.C.L. § 436.1909.
36

The Court further notes that Defendants have compromised any right to
equitable relief by admittedly participating in illegally sharing alcohol proceeds.
As Michigan courts have explained,
A claim for unjust enrichment is an equitable remedy. A party with
unclean hands may not assert claims for equitable relief such as a
claim for unjust enrichment. In Rose v. Nat’l Auction Grp., 466 Mich.
453, 463 (2002), our Supreme Court explained the clean hands
doctrine as follows:
The clean hands doctrine has been applied to deny equitable relief to
parties to a fraudulent contract:
If a contract has been entered into through fraud, or to accomplish any
fraudulent purpose, a court of equity will not, at the suit of one of the
fraudulent parties ... while the agreement is still executory, either
compel its execution or decree its cancellation, nor after it has been
executed, set it aside, and thus restore the plaintiff to the property or
other interests which he had fraudulently transferred. In other words,
any willful act in regard to the matter in litigation, which would be
condemned and pronounced wrongful by honest and fair-minded men,
will be sufficient to make the hands of the applicant unclean. Further,
a person cannot avoid the clean hands doctrine by relying on advice or
inducement to engage in a course of conduct where it is plainly
evident that the conduct is illegal or unethical. Just as courts will not
enforce a contract designed to harm a third party, courts will deny
equitable relief when the misconduct is directed at unrelated third
parties, if the claims made by plaintiff are inextricably tied to the
plaintiff’s wrongdoing.
Ammori v. Nafso, No. 312498, 2014 WL 308845, at *3 (Mich. Ct. App. Jan. 28,
2014) (internal quotations and citations omitted).
The Court concludes that Defendants have failed to state a claim for unjust
enrichment. The Court dismisses Count III of the Counterclaim.
37

2. Unjust Enrichment Counterclaim Against SFX
SFX argues that that Defendants’ unjust enrichment counterclaim is barred
by SFX’s bankruptcy reorganization.
Defendants state in their Response that, due to SFX’s bankruptcy discharge,
Defendants are not contesting SFX’s motion to dismiss the unjust enrichment
counterclaim against SFX. (Doc # 22, Pg ID 196)
The Court grants SFX’s uncontested motion to dismiss the unjust
enrichment counterclaim against SFX.
III.

CONCLUSION
For the reasons set forth above,
IT IS HEREBY ORDERED that Counter Defendant SFX-React Operating

LLC’s Motion to Dismiss Defendants’ Counterclaims (Doc # 18) is GRANTED.

Dated: August 23, 2017

s/Denise Page Hood
Chief, U.S. District Court

I hereby certify that a copy of the foregoing document was served upon counsel of
record on August 23, 2017, by electronic and/or ordinary mail.
s/Julie Owens
Acting in the absence of LaShawn Saulsberry
Case Manager

38