SpeedFit LLC et al v. Lifecore Fitness, Inc. et al
Filing
34
OPINION & ORDER re: 30 MOTION to Dismiss the Complaint. filed by Lifecore Fitness, Inc. For the foregoing reasons, the Court GRANTS Defendant's motion to dismiss the AC. Plaintiff is granted leave to file a Second Amended Com plaint (SAC). If Plaintiff chooses to do so, he will have until February 16, 2023, to file the SAC. Defendant is then directed to answer or otherwise respond by March 20, 2023. If Plaintiff fails to file a SAC, any claims dismissed without prejudi ce by this opinion and order will be deemed dismissed with prejudice. The Clerk of Court is respectfully directed to terminate the motion at ECF No. 30. ( Amended Pleadings due by 2/16/2023.) (Signed by Judge Nelson Stephen Roman on 1/17/2023) (ate)
Case 7:22-cv-03140-NSR Document 34 Filed 01/17/23 Page 1 of 9
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
1/17/2023
SPEEDFIT LLC and AUREL A. ASTILEAN,
Plaintiffs,
22-CV-3140 (NSR)
OPINION & ORDER
-against-
LIFECORE FITNESS, INC., and
ASSAULT FITNESS,
Defendants.
NELSON S. ROMÁN, United States District Judge:
Plaintiffs SpeedFit LLC and Aurel A. Astilean (collectively, “Plaintiffs”) commenced the
instant action against Defendants LifeCore Fitness and Assault Fitness (collectively,
“Defendants”), alleging (1) unjust enrichment; and (2) violation of New York General Business
(GBL) Law § 349.
Presently before the Court is Defendants’ motion to dismiss Plaintiffs’ Amended
Complaint pursuant to Fed. R. Civ. P. 12(b)(6). (ECF No. 30.) For the foregoing reasons,
Defendants’ motion is GRANTED.
BACKGROUND
This action springs from an intellectual property dispute over treadmills. The allegations
in the Amended Complaint (“AC”) are deemed true for the purpose of resolving this motion.
Plaintiff SpeedFit LLC (“SpeedFit”) is a Delaware limited liability company that is
licensed to conduct business in New York and has an agent for service located in Westchester
County, New York. (AC ¶ 1.) Plaintiff Aurel A. Astilean (“Astilean”) is the majority owner of
SpeedFit and its Chief Executive Officer. (AC ¶ 2.) SpeedFit engineered, designed, and built a
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treadmill known as “Speedboard 2” at significant expenses. Speedboard 2 is an innovative
treadmill due to two unique features: first, it is leg-powered and requires no energy source; second,
it has a curved running space that adjusts automatically according to its user’s weight and desired
speed. (AC ¶¶ 5-6.)
Before Speedboard 2, Astilean had developed a wooden prototype, Speedboard 1, which
was a leg-powered treadmill with a flat surface, in 2005. Astilean commissioned a metal prototype
of Speedboard 1. By December 2006, Speedboard 1 began to gain market interest and was featured
in Style Magazine, which endorsed the non-motorized, flat treadmill concept. (AC ¶¶ 31-32.)
However, Speedboard 1 required a battery-operated motor and had to be adjusted each user of
differing weights. (AC ¶ 33.) Astilean spent a few more years improving Speedboard 1’s design.
By late 2008, he built a wooden prototype of Speedboard 2, which allowed users of varying
weights to step on it and start running without any adjustment. (AC ¶¶ 36-37.) At the time, no
other treadmill on the market had this feature. (AC ¶ 37.)
On November 7, 2008, SpeedFit filed patent application number P-4096-38A for
Speedboard 2, which was approved. (AC ¶ 42.) A patent was issued to Astilean on or about
November 13, 2012. (Id.) In or about March 2009, the employees of Woodway, Inc. (“Woodway”),
the company which built SpeedFit’s metal production model of Speedboard 2, filed patent
application number 13235065 for Speedboard 2 (“Woodway Patent”). (AC ¶ 43.) SpeedFit sued
Woodway. As part of the settlement between SpeedFit and Woodway, the Woodway Patent was
assigned to SpeedFit for all purposes. (AC ¶ 44.) Speedboard 2 is now a staple for training by
professional sports teams in all sports and Division I College Sports Programs. Speedboard 2 is
also used by the U.S. military, including in remote overseas and desert locations without access to
readily available electricity. (AC ¶ 20.)
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Defendant LifeCore Fitness (“LifeCore”) is a California corporation. Defendant Assault
Fitness (“Assault”) is a California corporation and a wholly owned subsidiary of LifeCore. (AC
¶¶ 1-4.) Defendants are in the business of selling exercise fitness equipment, including a bestselling
“AssaultRunner Pro” treadmill and other non-motorized treadmills (collectively, “Assault
Treadmill”). (AC ¶ 21.) Defendants maintain websites at (1) lifecorefitness.com; (2)
assaultfitness.com; and (3) diamondbackfitness.com, through which Defendants advertise and sell
their products, including the Assault Treadmill. (AC ¶ 22.) Defendants market and sell the Assault
Treadmill nationwide, including in Westchester County, New York State. (AC ¶ 25.) Defendants
have contracted to sell treadmills to various New York athletic teams, including the New York
Yankees, Mets, and Jets, as well as to the U.S. Military Academy in West Point, New York. (AC
¶ 26.)
Plaintiffs allege that the Assault Treadmill wrongfully copies Speedboard 2 in violation of
Plaintiffs’ patents. Plaintiff asserts that, at the time of Speedboard 2’s invention, there was nothing
on the market even remotely resembling Speedboard 2. Prior to Plaintiffs’ sale of Speedboard 2,
Defendants did not manufacture, market, or sell a leg-powered treadmill, let alone one with a
curved running surface. (AC ¶ 27.) Plaintiffs further allege that the Assault Treadmill is inferior to
Speedboard 2, because—contrary to Defendants’ advertisement— the Assault Treadmill does not
reduce injury to users. Specifically, the Assault Treadmill has no catenary curve, which is
Speedboard 2’s critical injury-preventive feature. Thus, the incidence of injury on the Assault
Treadmill is far greater than on Speedboard 2. (AC ¶ 66.) As such, Plaintiffs aver that Defendants’
misrepresentation of the Assault Treadmill’s safety poses a danger to the consuming public. (AC
¶ 24.)
Defendants’ websites state that “LifeCore respects the intellectual property of others” and
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invites communications in connection therewith. (AC ¶ 23.) By letter dated October 16, 2018,
Plaintiffs notified Defendants that the Assault Treadmill infringed upon at least two of SpeedFit’s
patents. (AC ¶ 46.) By letter dated September 14, 2018, Defendants requested a claims chart to
analyze Plaintiff’s allegations of wrongdoing. (Id.) On October 16, 2018, SpeedFit provided the
requested claims chart and demanded that Defendants “cease and desist from any further
manufacture or sale of the [Assault Treadmill].” (Id.) Plaintiffs’ counsel communicated via email
with Defendants’ CEO, Matthew Simmons, between June 6 and 17, 2019. Simmons initially
indicated a willingness to meet to discuss Plaintiffs’ allegation, but later canceled the meeting.
(AC ¶ 47.) The parties never met. (Id.) Neither have Defendants ceased or desisted from selling
the Assault Treadmill, which comprises a substantial part of Defendants’ revenue from the past
ten years. (AC ¶¶ 48-49.) Plaintiffs accordingly aver that SpeedFit is entitled to Defendants’ gross
profits from the sale of each Assault Treadmill for the six years preceding the commencement of
this action and all future sales of the Assault Treadmill, in an amount presently believed to be more
than $20,000,000. (AC ¶¶ 50, 58.) Plaintiffs further seek monetary judgment against Defendants
for violation of GBL § 349 and permanent injunction enjoining Defendants from manufacturing
and selling the Assault Treadmill. (AC ¶¶ 60-74.)
LEGAL STANDARD
I.
Fed. R. Civ. P. 12(b)(6)
In deciding a motion to dismiss under Rule 12(b)(6), the Court must accept all factual
allegations in the complaint as true and draw all reasonable inferences in plaintiff’s favor. Freidus
v. Barclays Bank PLC, 734 F.3d 132, 137 (2d Cir. 2013). To survive a motion to dismiss, a
complaint must contain “sufficient factual matter, accepted as true, to state a claim to relief that is
plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v.
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Twombly, 550 U.S. 544, 570 (2007)). Mere “labels and conclusions” or “formulaic recitation[s] of
the elements of a cause of action will not do.” Twombly, 550 U.S. at 555 Rather, the complaint’s
“[f]actual allegations must be enough to raise a right to relief above the speculative level.” Id. at
555. In applying these principles, the Court may consider facts alleged in the complaint and
documents attached to it or incorporated by reference. Chambers v. Time Warner, Inc., 282 F.3d
147, 152–53 (2d Cir. 2002) (internal quotation marks and citation omitted).
II.
Preemption
Under the Supremacy Clause, state law that conflicts with federal law is preempted and
without effect. See U.S. Const. art. VI, cl. 2; Ultra-Precision Mfg., Ltd. v. Ford Motor Co., 411
F.3d 1369, 1377 (Fed. Cir. 2005). There are three types of preemption: “where Congress has
expressly preempted state law [(“explicit preemption”)], where Congress has legislated so
comprehensively that federal law occupies an entire field of regulation and leaves no room for
state law [(“field preemption”)], or where federal law conflicts with state law [(“conflict
preemption”)].” Wachovia Bank, N.A. v. Burke, 414 F.3d 305, 313–14 (2d Cir. 2005) (internal
citations omitted). Conflict preemption can arise where “state law stands as an obstacle to the
accomplishment and execution of the full purposes and objectives of Congress.” Fid. Fed. Sav. &
Loan Ass’n v. de la Cuesta, 458 U.S. 141, 153 (1982) (internal quotations and citations omitted).
DISCUSSION
I.
Preemption
Defendants argue that Plaintiffs’ unjust enrichment and GBL § 349 claims are preempted
by federal patent law. Plaintiffs assert that its unjust enrichment claim is not “conflict-preempted”
because New York state law on unjust enrichment does not “stand as an obstacle to” federal patent
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law. (Pl. Opp. at 12-13, ECF No. 33.) The question for the Court is whether Plaintiffs’ claims are
preempted as pled.
This case concerns only conflict preemption.1 In determining “whether these state law torts
are in conflict with federal patent law and accordingly preempted,” the Federal Circuit2 assesses a
defendant’s allegedly tortious conduct. Hunter Douglas, Inc. v. Harmonic Design, Inc., 153 F.3d
1318, 1335 (Fed. Cir. 1998), overruled on other grounds by Midwest Indus., Inc. v. Karavan
Trailers, Inc., 175 F.3d 1356 (Fed. Cir. 1999). “If a plaintiff bases its tort action on conduct that is
protected or governed by federal patent law, then the plaintiff may not invoke the state law remedy,
which must be preempted for conflict with federal patent law. Conversely, if the conduct is not so
protected or governed, then the remedy is not preempted.” Id. at 1335.
Here, Plaintiffs’ unjust enrichment claim3 is predicated solely upon Defendants’ alleged
replication of Speedboard 2 in violation of Plaintiffs’ patents, a tortious conduct—also known as
“patent infringement”—that is squarely within federal patent law’s purview. See 35 U.S.C.A. §
271(a) (“[W]hoever without authority makes, uses, offers to sell, or sells any patented invention,
within the United States or imports into the United States any patented invention during the term
of the patent therefor, infringes the patent.”) In addition, 35 U.S.C. Section 284, titled “Damages,”
aptly addresses the remedies Plaintiffs sought for their unjust enrichment. See 35 U.S.C.A. § 284
(West) (“Upon finding for the claimant the court shall award the claimant damages adequate to
Federal patent law does not provide explicit preemption, and “Congress does not intend to occupy exclusively the
field of unjust enrichment law.” Ultra-Precision Mfg., Ltd., 411 F.3d at 1377 (citing 35 U.S.C. §§ 1–376 (2000) and
Univ. of Colorado Found., Inc. v. Am. Cyanamid Co., 196 F.3d 1366, 1371 (Fed. Cir. 1999)).
2
Federal Circuit law governs whether federal patent law preempts a state law claim. Ultra-Precision Mfg., Ltd. v.
Ford Motor Co., 411 F.3d 1369, 1376 (Fed. Cir. 2005) (internal citation omitted).
3
To prevail on a claim of unjust enrichment, plaintiff must show that (1) defendant was enriched (2) at plaintiff’s
expense, and (3) that “it is against equity and good conscience to permit . . .defendant to retain what is sought to be
recovered.” Lake Minnewaska Mountain Houses Inc. v. Rekis, 259 A.D.2d 797, 798 (1999) (internal citations
omitted).
1
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compensate for the infringement, but in no event less than a reasonable royalty for the use made
of the invention by the infringer . . .”).
Further, Plaintiffs pled no additional elements that may absolve this claim of its
impermissibility “to offer patent-like protection to subject matter addressed by federal law.”
Bytemark, Inc. v. Xerox Corp., 342 F. Supp. 3d 496, 507 (S.D.N.Y. 2018) (“The patent laws will
not preempt [state law] claims . . . if they include additional elements not found in the federal
patent law cause of action and if they are not an impermissible attempt to offer patent-like
protection to subject matter addressed by federal law.”) Accordingly, Plaintiffs’ unjust enrichment
claim is clearly preempted and dismissed without prejudice.
Plaintiffs’ GBL § 349 claim comprises of two parts: first, a copying claim based upon the
same alleged conducts as the unjust enrichment claim (“GBL § 349 copying claim”); and second,
a deceptive act claim based upon Defendants’ alleged misrepresentation of the Assault Treadmill’s
safety level (“GBL § 349 deceptive acts claim”). The GBL § 349 copying claim is preempted and
accordingly dismissed without prejudice for the same reasons discussed above.
As to Plaintiff’s GBL § 349 deceptive acts claim, drawing all inferences in favor of
Plaintiffs, the Court interprets Plaintiff’s second cause of action to include deceptive acts by
Defendants, which are not found in the federal patent law. According, Plaintiffs’ GBL § 349
deceptive acts claim is not preempted. See Bytemark, Inc. at 407.
II.
Statutes of Limitations
Defendants next argue that Plaintiffs’ GBL § 349 claim is time-barred.
GBL § 349 claims are subject to a three-year statute of limitations. See Marshall v.
Hyundai Motor Am., 51 F. Supp. 3d 451, 459 (S.D.N.Y. 2014) (internal citations omitted); see also
Schandler v. N.Y. Life Ins. Co., No. 09–CV–10463, 2011 WL 1642574, at *4 (S.D.N.Y. Apr. 26,
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2011) (“Private rights of action under section 349 are governed by a three-year statute of
limitations . . .”). The accrual of a GBL § 349 claim begins to run at the time of the plaintiff’s
injury, or “when all of the factual circumstances necessary to establish a right of action have
occurred, so that plaintiff would be entitled to relief.” Bristol Vill., Inc. v. Louisiana-Pac. Corp.,
170 F. Supp. 3d 488, 497 (W.D.N.Y. 2016) (citing Gristede’s Foods, Inc., v. Unkechauge Nation,
532 F. Supp. 2d 439, 453 (E.D.N.Y.2007)).
Plaintiffs do not contest that three years have passed since Defendants’ alleged
misrepresentation of the Assault Treadmill’s safety. Instead, Plaintiffs assert Defendants’ conducts
fall
under
the
continuing
wrong
doctrine,
which
tolls
the
limitations
period.
The continuous wrong doctrine is “an exception to the general rule that the statute of limitations
‘runs from the time of the breach though no damage occurs until later.’” Henry v. Bank of Am.,
147 A.D.3d 599, 601 (2017) (citing Ely–Cruikshank Co. v. Bank of Montreal, 81 N.Y.2d 399, 402
(1993)). However, this doctrine “may only be predicated on continuing unlawful acts and not on
the continuing effects of earlier unlawful conduct. The distinction is between a single wrong that
has continuing effects and a series of independent, distinct wrongs.” Id. at 601 (internal citations
omitted) (emphasis added). The continuing wrong doctrine is inapplicable “where there is one
tortious act complained of since the cause of action accrues in those cases at the time that the
wrongful act first injured plaintiff and it does not change as a result of continuing consequential
damages.” Id.
As pled in AC, Defendants’ wrong for Plaintiffs’ GBL § 349 deceptive acts claim is to
have “advertised [the Assault Treadmill] as safe to use but was not.” (AC ¶ 65.) Perplexingly,
Plaintiffs identify no advertisement by Defendants. 4 Even the most favorable inference for
4
The Court need not reach the Plaintiffs’ pleading sufficiency for this motion, but Plaintiffs’ allegation here clearly
contains insufficient “factual matter.” Cf. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).
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Plaintiffs cannot justify a conclusion that Defendants committed “a series of independent,
distinct wrongs” that render applicable the continuing wrong doctrine. Henry, 147 A.D.3d at 601.
Accordingly, Plaintiffs’ remaining GBL § 349 deceptive acts claim is time-barred and
dismissed without prejudice.
CONCLUSION
For the foregoing reasons, the Court GRANTS Defendant’s motion to dismiss the AC.
Plaintiff is granted leave to file a Second Amended Complaint (SAC). If Plaintiff chooses to do
so, he will have until February 16, 2023, to file the SAC. Defendant is then directed to answer or
otherwise respond by March 20, 2023. If Plaintiff fails to file a SAC, any claims dismissed without
prejudice by this opinion and order will be deemed dismissed with prejudice.
The Clerk of Court is respectfully directed to terminate the motion at ECF No. 30.
Dated: January 17, 2023
White Plains, New York
SO ORDERED:
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