REESE et al v. POOK & POOK, LLC et al

Filing 50

MEMORANDUM AND/OR OPINION. SIGNED BY HONORABLE LAWRENCE F. STENGEL ON 1/27/16. 1/28/16 ENTERED AND COPIES E-MAILED.(kw, )

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
CARTER P. and SARAH REESE
(HUSBAND AND WIFE),
Plaintiffs
vs.
POOK & POOK, LLC., RON POOK,
DEBRA POOK, JAMES POOK, JAY
LOWE, CONNIE & JAY LOWE
ANTIQUES, MIKE CAFFARELLA,
JAMIE SHEARER, MAINE
ANTIQUE DIGEST, S. CLAYTON
PENNINGTON,
KATE PENNINGTON, and LITA
SOLIS-COHEN
Defendants

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CIVIL ACTION

NO. 14-5715

MEMORANDUM
STENGEL, J.
I.

January 27, 2016

INTRODUCTION
Presently pending are multiple Motions by the named Defendants in this Lanham

Act and antitrust action to dismiss the Amended Complaint (“AC”) of Plaintiffs Carter P.
(“Reese”) and Sarah Reese (collectively the “Reeses”).1 For the reasons that follow, I
grant the pending Motions, save for several common law claims against Defendants Jay
Lowe2 and Mike Caffarella.

1

Because there are multiple Motions, Responses, and Replies, I will refer and cite to
them by their ECF docket number.
2

Plaintiffs name as defendants Jay Lowe and Connie and Jay Lowe Antiques. I refer to
them collectively as “Lowe.”

II.

STANDARD OF REVIEW
A motion to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure

for failure to state a claim upon which relief can be granted examines the sufficiency of
the complaint. Conley v. Gibson, 355 U.S. 41, 45-46 (1957). Following the Supreme
Court decisions in Bell At. Corp. v. Twombly, 550 U.S. 544, 555 (2007) and Ashcroft v.
Iqbal, 556 U.S. 662, 679 (2009), pleadings standards in federal actions have shifted from
simple notice pleading to a more heightened form of pleading, requiring a plaintiff to
plead more than the possibility of relief to survive a motion to dismiss under Fed. R. Civ.
P. 12(b)(6). Fowler v. UPMC Shadyside, 578 F.3d 203, 210-211 (3d Cir. 2009); see also
Phillips v. County of Allegheny, 515 F.3d 224, 230 (3d Cir. 2008). Therefore, when
presented with a motion to dismiss for failure to state a claim, district courts conduct a
two-part analysis. First, the factual and legal elements of a claim are separated. The
court must accept all of the complaint’s well-pleaded facts as true but may disregard legal
conclusions. Iqbal, 556 U.S. at 679. Second, a district court must determine whether the
facts alleged in the complaint are sufficient to show that the plaintiff has a “plausible
claim for relief.” Id. In other words, a complaint must do more than allege the plaintiff’s
entitlement to relief. A complaint has to “show” such an entitlement with its facts. Id.;
see also Phillips, 515 F.3d at 234-235. “Where 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 pleader is entitled to relief.’” Iqbal, 556 U.S. at 679.
Under Federal Rule of Civil Procedure 8(a)(2), a pleading must contain a “short
and plain statement of the claim showing that the pleader is entitled to relief.” As the
2

Court held in Twombly, the pleading standard Rule 8 announces does not require
“detailed factual allegations,” but it demands more than an unadorned, the-defendantunlawfully-harmed-me accusation. Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S.
at 555). A pleading that offers “labels and conclusions” or “a formulaic recitation of the
elements of a cause of action will not do.” Twombly, 550 U.S. at 555. Nor does a
complaint suffice if it tenders “naked assertion[s]” devoid of “further factual
enhancement.” Id. at 557.
A motion to dismiss pursuant to Rule 12 (b)(1) for “lack of jurisdiction over the
subject matter” is governed by a different standard. Because the motion goes to our
jurisdiction, i.e., the very power to hear the case, there is substantial authority that the
court is free to weigh the evidence and satisfy itself as to the existence of its power to
hear the case. Mortensen v. First Fed. Sav. and Loan Ass’n, 549 F.2d 884, 891 (3d
Cir.1977). There is no presumptive truthfulness attached to plaintiff’s allegations, the
existence of disputed material facts will not preclude the trial court from evaluating for
itself the merits of jurisdictional claims, the plaintiff has the burden of proof that
jurisdiction does in fact exist. Id.
III.

FACTUAL ALLEGATIONS
The Reeses are collectors of antique toys. (AC ¶ 4.) On October 2, 2012, they

filed a Chapter 11 bankruptcy petition in the United States Bankruptcy Court for the
Eastern District of Pennsylvania. (Id. ¶¶ 44-45.) As part of the bankruptcy proceeding,
the Reeses were required to sell a portion of their toy collection. (Id. ¶ 46.) Defendant
Pook & Pook, LLC (“P&P”) was approved by the Bankruptcy Court as the auctioneer to
3

sell the collection. (Id. ¶ 47.) P&P and the Bankruptcy Estate of Carter Reese and Sarah
Reese entered into an agreement for the sale of the toys. (ECF 26 Ex. B.3) The
agreement was approved by the Bankruptcy Court. (Id. Ex. C.) Defendants Ron Pook,
Debra Pook, and James Pook (collective “the individual Pook Defendants”) are principals
of P&P. (AC ¶¶ 20-22.) None of the individual Pook Defendants were parties to the
agreement. There is no allegation in the AC that the Reeses obtained permission from the
Bankruptcy Court to file the pending claims against P&P.
The Reeses allege that Carter Reese and Ron Pook agreed that the toy collection
would be sold in several different sales, owing to the great volume being offered (AC ¶
49), and Carter would be involved in the sale preparations to identify objects and review
pre-sale estimates. (AC ¶ 51.) They allege that this did not happen and, despite their
disapproval, P&P retained Defendants “Caffarella and, thus, Lowe,” as experts to assist
the auction sale. (AC ¶ 53-54.) Although the auction resulted in proceeds of
approximately $560,000, the Reeses assert that the toys should have “fetched a far greater
amount.” (Id. ¶ 80.) They contend that the poor result was caused by the improper
presentation of the toys at the auction. They assert that the staging of the sale was
deliberately flawed to diminish the value of the toys: toys were presented in piles with no
effort to match parts into complete toys, parts of various two- and three-part toys were

3

Although it is not attached as an exhibit to the AC, the Reeses reference the agreement
in the AC and do not dispute that Ex. B is the actual agreement. Accordingly, I consider it as
part of the pleadings in deciding the pending Motions to dismiss. See W. Penn Allegheny Health
Sys. v. UPMC, 627 F.3d 85, 97 n. 6 (3d Cir. 2010) (stating that, as a general rule, the court may
not consider on a motion to dismiss matters extraneous to the pleadings, but an exception exists
for documents “integral to or explicitly relied upon in the complaint”).
4

not matched, allowing, for example, the front end of one horse-drawn toy to go in one
box lot with the back end placed in a different lot. (Id. ¶¶ 56-60.) As a result, on-line
and phone bidders had no opportunity to identify boxes of mismatched objects and could
not know the contents of any lot or where various parts could be found. (Id. ¶¶ 61-62.)
They allege that this benefited Lowe, who knew where the mismatched parts were
located in the different lots, and that he bid accordingly for the items he wanted, won
them at depressed prices, reassembled them, and placed them for resale at significant
markup at his own business. (Id. ¶¶ 63-75.) The Reeses allege that Lowe had previously
disparaged their collection at the James Julia Auctions in Maine, where he worked on
commission basis gathering collections for auction, then bought dozens of lots to resell.
(Id. ¶¶ 83-85.) Plaintiffs also assert that the P&P catalogue of the Reese sale prominently
promoted fake antiques called “newtiques,” created by Lowe using original parts from
antique toys and placing them on new toys, further disparaging the quality of toys in the
Reese collection. (Id. ¶¶ 87-109.) They also allege that, after the auction, P&P sent an
employee, Jamie Shearer, to the Reninger Antique Mall to criticize the collection as
“junk.” (Id. ¶¶ 115-117.)
Lita Solis-Cohen is the senior editor of the Maine Antique Digest (“MAD”). (Id. ¶
15.4) She authored an article, “Pook’s First Toy Auction,” for the December 2013 MAD
issue (“the Article”). (Id. ¶ 129.) The first sentence read in part that P&P “will sell any

4

Also named as defendants are MAD, S. Clayton Pennington, editor of MAD, and Kate
Pennington, managing editor of MAD (collectively with Solis-Cohen, the “MAD Defendants”).
(Id. ¶¶ 13-14.) The AC contains no substantive allegations concerning the Penningtons.
5

collection that comes along.” (Id. ¶ 130.) She went on to write, relying on information
allegedly from Lowe, that:
Everyone in the toy world seemed to know the major
cosignor [sic, in AC] was Carter Reese, a longtime
collector who bought toys that he loved before collectors
got hung up on condition. It didn’t matter to him if the
toy had replaced figures, was repainted, or if much of the
paint was missing. If the toy had charm and was cheap,
he bought it.
(Id. ¶ 131.) She stated that ‘“[t]he consensus was that many of the toys that Pook offered
brought all they were worth. . .’ because, in the words of Jay Lowe, ‘condition is king.’”
(Id. ¶ 132.) Plaintiffs allege that these statements were published with actual malice
and/or with reckless disregard for the truth as a “puff piece” for Lowe and his newtiques.
(Id. ¶¶ 133-135.)
The AC contains eleven counts: (1) civil conspiracy against P&P, the individual
Pook Defendants, Caffarella and Lowe; (2) violation of the Lanham Act, 15 U.S.C. §
1125 for false commercial advertising in the placement of Lowe’s newtique on the cover
of the sale catalogue and the negative commentary in MAD about the quality of the
collection;5 (3) common law unfair competition, coextensive with the Lanham Act claim;

5

Plaintiffs do not specifically state which Defendants they intend to hold liable under
Count II and Count III. I assume they intend to include P&P, the individual Pook Defendants,
and the MAD defendants. I note that while these Counts do not mention him, Lowe has raised
an argument why the claims should be dismissed. There is no allegation that Lowe was
responsible for the placement of his newtique on the cover of the sale catalogue; indeed the
Reeses entitle that portion of the AC “Pook’s Promotion of Lowe’s “Newtiques” . . . . (AC at
page 15.) While there is no allegation that he published the allegedly negative comment in MAD
about the quality of the Reeses’ collection, he is quoted in the Article. Accordingly, I will
address this aspect of the claim when I discuss Lowe’s Motion.
6

(4) violation of section one and two of the Sherman Act;6 (5) commercial
disparagement/trade defamation against MAD and Lowe for which they seek inter alia
the publication of a corrective article; (6) a claim pursuant to Restatement (Second) of
Torts § 652E for false light against MAD and Lowe; (7) common law “injurious
falsehood” against MAD and Lowe; (8) breach of fiduciary duty against P&P, the
individual Pook Defendants and Caffarella; (9) negligence;7 (10) breach of contract,
breach of the duty of good faith and fair dealing, and “dishonesty in fact” against P&P
and the individual Pook Defendants; and (11) common law unjust enrichment against
P&P, the individual Pook Defendants, Caffarella and Lowe.
IV.

P&P AND INDIVIDUAL POOK DEFENDANTS’ MOTION TO DISMISS
In their Motion (ECF 26), P&P and the individual Pook Defendants argue that, as

the claims contained in the AC all arise from their involvement in the auction sale of the
Reeses’ assets, and that their involvement arose from the Bankruptcy Court’s order
approving P&P’s appointment to conduct the sale, Plaintiff’s failure to allege that they
secured the permission of the Bankruptcy Court before filing the claims strips us of
subject matter jurisdiction. I agree.
6

Count IV also does not specify which defendants Plaintiffs intend to name. They
mention only that the count is based on “Pook & Pook sale preparation by Lowe/Caffarella.”
(Id. ¶ 198.) I note, however, that the MAD Defendants have included an argument why the
Sherman Act count should be dismissed as to them. (See MAD Defs.’ Mem. at 11-12.) In their
Response, the Reeses have not addressed that argument, and only discuss the Sherman Act claim
with regard to P&P, the individual Pook Defendants, Lowe, and Caffarella. (See Resp. at 6063.) Accordingly, I assume that Plaintiffs intended to assert Sherman Act liability only against
P&P, the individual Pook Defendants, Lowe, and Caffarella.
7

Count X also does not state which defendants are sought to be held liable. It merely
recited “Defendants have breached duties owed the Reeses.” (AC ¶ 228.) I assume that Count X
includes all defendants.
7

In In re VistaCare Grp., LLC, 678 F.3d 218 (3d Cir. 2012), the United States
Court for the Third Circuit “join[ed] our sister circuits in holding that, under the doctrine
established in Barton v. Barbour, [104 U.S. 126 (1881),] leave of the bankruptcy court is
required before instituting” an action against a bankruptcy trustee. Id. at 224 (citing
Lawrence v. Goldberg, 573 F.3d 1265, 1269 (11th Cir. 2009) (holding that the Barton
doctrine is applicable to bankruptcy trustees); In re Crown Vantage, Inc., 421 F.3d 963,
970 (9th Cir. 2005) (same); Muratore v. Darr, 375 F.3d 140, 143 (1st Cir. 2004) (same);
In re Linton, 136 F.3d 544, 545-46 (7th Cir. 1998) (same); In re Lehal Realty Assocs.,
101 F.3d 272, 276 (2d Cir. 1996) (same); In re DeLorean Motor Co., 991 F.2d 1236,
1240 (6th Cir. 1993) (same); Anderson v. United States, 520 F.2d 1027, 1029 (5th Cir.
1975) (same). The Barton doctrine has been applied to Chapter 11 proceedings as well as
Chapter 7 proceedings. See, e.g., In re Crown Vantage, Inc., 421 F.3d at 970 (adopting
Barton doctrine in Chapter 11 debtor-in-possession case). It applies to bar suits against
bankruptcy fiduciaries even after the bankruptcy proceedings have closed. See Muratore
v. Darr, 375 F.3d 140, 147 (1st Cir. 2004) (stating that “the doctrine serves additional
purposes even after the bankruptcy case has been closed and the assets are no longer in
the trustee’s hands) citing In re Linton, 136 F.3d at 544-45 (applying Barton to closed
bankruptcy case). Finally, the doctrine shields not only the bankruptcy trustee, but also
“other bankruptcy-court-appointed officer[s], for acts done in the actor’s official
capacity.” Carter v. Rodgers, 220 F.3d 1249, 1252 (11th Cir. 2000) (applying doctrine to
bar suit against bankruptcy trustee and antiques dealer appointed by the bankruptcy
trustee to conduct sale of estate property).
8

The Reeses respond that the Barton doctrine does not apply because they “are
operating under a confirmed plan and all of the assets have been returned to Carter to do
with as he likes. Barton [is] simply inapplicable as there is zero impact on the confirmed
plan and none of the Reeses’ claims involve, in anyway [sic], any property under the
Bankruptcy Court’s jurisdiction.” (ECF 26 at 18.) They also argue that Barton cannot
apply because the Bankruptcy Court lacks jurisdiction to hear the claims against P&P and
the Pook Defendants. While conceding that “it is true that the subject sale occurred
during and as a result of the bankruptcy . . . all of the Reeses’ claims exist postconfirmation outside of the Bankruptcy Code.” (Id. at 18-19.)
The Reeses’ arguments that the doctrine does not apply because their claims are
outside the bankruptcy code, because their bankruptcy has ended, and because the
bankruptcy court would have no jurisdiction to hear the claims are meritless. In Carter,
the United States Court of Appeals for the Eleventh Circuit rejected these very assertions.
In Carter, the court-appointed bankruptcy trustee and his wife attended the auction of the
estate property and the wife successfully bid on one lot. Carter filed suit against the
trustee and the antiques dealer that conducted the auction for breach of fiduciary duty and
negligence. In affirming the district court’s dismissal for lack of subject matter
jurisdiction under the Barton doctrine, the Court held that there was no merit to
Carter’s assertion that his tort claims — breach of
fiduciary duty and reasonable care — are “unrelated to”
and “outside the scope” of the bankruptcy proceeding
because they do not arise directly from substantive
provisions of the Bankruptcy Code. Carter posits the
theory that because his claims are unrelated to the
bankruptcy proceeding, the bankruptcy court lacks
9

jurisdiction over his lawsuit and, therefore, he was not
required to obtain leave of the bankruptcy court
before bringing his suit in district court. We disagree.
The bankruptcy court has jurisdiction over Carter’s claims
because his breach of fiduciary duty and reasonable care
claims are “related to” and “within the scope” of the
bankruptcy proceeding. . . . A proceeding is within the
bankruptcy jurisdiction, defined by 28 U.S.C. § 1334(b), if
it “arises under” the Bankruptcy Code or “arises in” or is
“related to” a case under the Code.8 “‘Arising under’
proceedings are matters invoking a substantive right
created by the Bankruptcy Code. The ‘arising in a case
under’ category is generally thought to involve
administrative-type matters, or as the ... court put it,
‘matters that could arise only in bankruptcy.’” In re
Toledo, 170 F.3d 1340, 1345 (11th Cir. 1999) (citations
omitted).9 We have stated, “The usual articulation of the
test for determining whether a civil proceeding is related
to bankruptcy is whether the outcome of the proceeding
could conceivably have an effect on the estate being
administered in bankruptcy.” Miller v. Kemira, Inc. (In re
Lemco Gypsum, Inc.), 910 F.2d 784, 788 (11th Cir.
1990). While Carter’s action against Defendants arose
after the date of the bankruptcy petition, his suit turns
solely on allegations of wrongdoing in the sale of
property belonging to the bankruptcy estate. Any
recovery would reduce the administrative expenses of the
sale of the estate property and would perforce increase the
amount of estate property available to satisfy creditors’
claims. . . . Thus, the outcome of this case will impact
Carter’s bankruptcy estate. Further, Carter sued the
8

The Third Circuit has also recognized that bankruptcy jurisdiction under 28 U.S.C. §
157(a) extends to cases “arising under,” “arising in,” and “related to” bankruptcy jurisdiction. In
re W.R. Grace & Co., 591 F.3d 164, 171 (3d Cir. 2009). “Arising under” and “arising in” claims
are “core” bankruptcy claims; claims “related to” a bankruptcy case are not. Stoe v. Flaherty,
436 F.3d 209, 219 (3d Cir. 2006).
9

The Third Circuit has similarly held that claims that “arise in” bankruptcy include those
“that by their nature, not their particular factual circumstances, could only arise in the context of
a bankruptcy case.” Stoe, 436 F.3d at 218 (citing Halper v. Halper, 164 F.3d 830, 836 (3d Cir.
1999) (stating that a proceeding is “core” “if it is a proceeding that, by its nature, could arise only
in the context of a bankruptcy case”) (quotation omitted) (emphasis added); 1 Collier on
Bankruptcy § 3.01[4][c][iv] at 3–31).
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trustee and other court approved officers of his bankruptcy
estate for alleged breaches of their bankruptcy-related
duties. The Bankruptcy Code establishes the office of
trustee and defines the trustees’ duties. Moreover, an
action against a bankruptcy trustee for breach of
bankruptcy-related fiduciary duty can only arise in a
bankruptcy case. Thus, Carter’s “fiduciary claims
against [the fiduciaries] are within the bankruptcy
jurisdiction defined by 28 U.S.C. § 1334(b) both as
‘arising under’ the Code and ‘arising in’ a bankruptcy
case.”
Carter, 220 F.3d at 1253-54 (internal citations omitted, emphasis added). The Reeses,
notably, have failed to address the holding of Carter.
I find, applying the holding of Carter, that the claims against P&P and the
individual Pook Defendants fall within the “arising in a case under” category of
bankruptcy jurisdiction. The claims against these Defendants assert civil conspiracy,
violation of the Lanham Act, unfair competition, violation of the Sherman Act, breach of
fiduciary duty, negligence, breach of contract, dishonesty in fact, and unjust enrichment.
All of them arise from these Defendants’ involvement in the auction of the Reeses’ toy
collection, as ordered by the Bankruptcy Court. Like in Carter, the claims arise out of the
disposition of property of an estate, as opposed to non-estate property of the bankruptcy
petitioners. If the auction was tainted, it was the bankruptcy estate that suffered since the
auction proceeds that were allegedly diminished by the Defendants’ actions were the
property of the estate to be used to pay creditors. I also find that the claims, which
concern how the estate was administered, qualify as both “arising under” the Code and
“arising in” a bankruptcy case under 28 U.S.C. § 1334(b).

11

Because they are core claims, the Barton doctrine applies to them and leave of the
bankruptcy court was required before instituting them. Because there is no assertion that
the Reeses complied with that requirement, the claims against P&P and the individual
Pook Defendants are subject to dismissal in their entirety.
V.

MAD DEFENDANTS’ MOTION TO DISMISS
In their Motion (ECF 25), the MAD Defendants argue all claims contained in the

AC should be dismissed. I will discuss each claim in order.
a.

Count II — Lanham Act

Count II is premised upon Section 43(a)(1)(B) of the Lanham Act, 15 U.S.C. §
1125(a)(1)(B), which provides in pertinent part:
(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). Liability arises if a commercial message, statement, or
advertisement is “either (1) literally false or (2) literally true or ambiguous, but has the
tendency to deceive consumers.” Novartis Consumer Health, Inc. v. Johnson & JohnsonMerck Consumer Pharm. Co., 290 F.3d 578, 586 (3d Cir. 2002) citing Castrol Inc. v.
Pennzoil Co., 987 F.2d 939, 943 (3d Cir. 1993) (“a plaintiff must prove either literal

12

falsity or consumer confusion, but not both”) (emphasis deleted). The elements of a
Lanham Act claim for false advertising, or false or misleading representation of a
product, are: “(1) that the defendant has made false or misleading statements as to his
own product [or another’s]; (2) that there is actual deception or at least a tendency to
deceive a substantial portion of the intended audience; (3) that the deception is material in
that it is likely to influence purchasing decisions; (4) that the advertised goods traveled in
interstate commerce; and (5) that there is a likelihood of injury to the plaintiff in terms of
declining sales, loss of good will, etc.” Warner-Lambert Co. v. Breathasure, Inc., 204
F.3d 87, 91-92 (3d Cir. 2000) (alteration in original) (quoting Johnson & Johnson-Merck
Consumer Pharm. Co. v. Rhone–Poulenc Rorer Pharm., Inc., 19 F.3d 125, 129 (3d Cir.
1994)); Pernod Ricard USA, LLC v. Bacardi U.S.A., Inc., 653 F.3d 241, 248 (3d Cir.
2011)).
Commercial “advertising or promotion” for purposes of Lanham Act § 43(a)(1)(B)
“consists of (1) commercial speech; (2) by a defendant in commercial competition with
the plaintiff; (3) designed to influence customers to buy the defendant’s products; (4) that
is sufficiently disseminated to the relevant purchasing public to constitute advertising or
promotion within the industry.” Synygy, Inc. v. Scott-Levin, Inc., 51 F. Supp. 2d 570,
576-77 (E.D. Pa. 1999) aff’d sub nom. Synygy, Inc. v. Scott-Levin, 229 F.3d 1139 (3d
Cir. 2000); Premier Comp Solutions., LLC v. Penn Nat. Ins. Co., Civ. A. No. 07-1764,
2012 WL 1038818, at *7 (W.D. Pa. Mar. 28, 2012) (same); 5 McCarthy on Trademarks
and Unfair Competition § 27:71 (4th ed.) (same). The word “commercial” “excludes use
of § 43(a) to challenge the falsity of “consumer or editorial content, parodies, satires, or
13

other constitutionally protected material.” 5 McCarthy on Trademarks and Unfair
Competition § 27:71 (4th ed.). Thus, “any message that does not qualify as commercial
speech cannot be the subject of a § 43(a) false advertising or product disparagement
challenge.” Id.
The MAD Defendants first argue that Count II fails to allege a plausible violation
of Section 43(a) because the Article does not meet any of the first three elements of the
test for commercial advertising or promotion. Specifically, they argue first that the
Reeses have failed to allege that the Article — a piece of journalism — constitutes
“commercial advertising or promotion” since it does not describe a specific product or
service, but rather an event, the Pook auction, that had already occurred. They note that
the Reeses have failed to allege any motivation on their part for publishing the Article
other than to provide information and opinion of interest to readers about that event.
Second, they argue that the Reeses have failed to allege that they are in commercial
competition with Plaintiffs in the antique toy trade. Rather, the AC alleges that the MAD
Defendants produce a trade journal. (AC ¶¶ 119-120.) Third, they argue that there is no
allegation that the Article influenced customers to buy any products sold by the MAD
Defendants, since they are not sellers of antique toys.
The Reeses respond by asserting that direct competition between themselves and
the MAD Defendants is not relevant because the Lanham Act is “‘very broadly worded
and applies to ‘any person’ who uses virtually any means to deceive the public regarding
. . . commercial activities. . . .” (ECF 31 at 27 (quoting Electronic Lab. Supply. Co., Inc.
v. Cullen, 977 F.2d 798, 807 (3d Cir. 1992)).) They contend that the Third Circuit has
14

held that, “by denoting the broad scope of Section 43(a) — ‘any person,’ the 3rd Circuit
conclusively held that a non-competitor has the right to sue for harm caused by the false
representation of services in commerce.” (Id. (citing Serbin v. Ziebart Intern. Corp., Inc.,
11 F.3d 1163, 1175-77 (3d Cir. 1993)).) I find that these citations are inapposite. In
Cullen, the issue was whether one could be liable for another person’s violation of
Lanham Act § 34’s prohibition on the use of counterfeit marks on an aiding and abetting
theory (answered in the negative). Id. at 798. In Serbin, the issue was whether
“consumers of goods or services in interstate commerce who allege that, to their
detriment, they purchased such goods or services in reliance on the advertising claims of
the vendor, have a federal cause of action under subsection 1 of Section 43(a). . . .” Id. at
1164 (emphasis added); 1177 (holding that “consumers fall outside the range of
‘reasonable interests’ contemplated as protected by the false advertising prong of Section
43(a)”). Neither decision stands for the proposition that a claim under Lanham Act §
43(a)’s prohibition against false commercial advertising or promotion may be maintained
in the absence of competition between the parties.
The sole allegation in Count II, insofar as it relates to the MAD Defendants, is that
the Article was “widely disseminated to the antique world.” (AC ¶ 172.10) It must be
remembered, of course, that the Article was published after the sale occurred, and was a
10

The balance of Count II concerns only P&P, the individual Pook Defendants, Lowe,
and Caffarella. The only other time the MAD Defendants are mention is the assertion that the
placement of the newtiques on the cover of the sale catalogue “carried through antique malls and
the nation’s leading antique journal — the Maine Antique’s Digest, both falsely represented,
disparaged the Reeses’ collection while inflating the value of Lowe’s fake newtiques.” (AC ¶
170.)
15

report of the sale itself. It is implausible, therefore, that any alleged falsity in the Article
— even if it could be considered “commercial advertising or promotion”— could have
damaged Plaintiffs by impacting the value of the collection sold at the auction.11 As they
allege no commercial competition with Plaintiffs in the antique toy trade, and no direct
injury arising from the publication of the Article against which the Lanham Act was
designed to protect, Count II is subject to dismissal as to the MAD Defendants.
b.

Count III — State Law Unfair Competition

“Under Pennsylvania law, the elements necessary to prove unfair competition
through false advertising parallel those elements needed to show a Lanham Act violation,
absent the requirement for goods to travel in interstate commerce.” Leonetti’s Frozen
Foods, Inc. v. Am. Kitchen Delights, Inc., Civ. A. No. 11-6736, 2012 WL 1138590, at
*11 (E.D. Pa. Apr. 4, 2012) (quoting KDH Elec. Sys., Inc. v. Curtis Tech. Ltd., 826 F.
Supp. 2d 782, 807 (E.D. Pa. 2011)); see also Louis Vuitton Malletier & Oakley, Inc. v.
Veit, 211 F. Supp. 2d 567, 582 (E.D. Pa. 2002) (same). Because the Lanham Act
allegations in Count II fail to allege a plausible claim under federal law for a false
advertising injury against the MAD Defendants, I find that the common law claim also
fails. I note, additionally, that Count III does not even mention the MAD Defendants or
the Article.

11

I discuss at length — and reject — whether the Article can constitute “commercial
advertising or promotion” below in the consideration of Defendant Lowe’s Motion.
16

c.

Counts V and VII — Commercial Disparagement and Injurious Falsehood

Counts V and VII allege the same injury under two legal theories containing the
same elements, commercial disparagement and injurious falsehood arising from the
publication of the Article.12 It is undisputed by the parties that the elements of these two
12

The Article is referenced and quoted in the AC but not attached thereto. I consider it as
part of the pleadings in deciding the pending Motions to dismiss. W. Penn Allegheny Health
Sys., 627 F.3d at 97 n. 6. It stated in pertinent part:
As with many regional auction houses, Pook & Pook in Downington,
Pennsylvania, will sell any collection that comes along. . . . When a local
collector wanted to downsize his huge toy collection, Pook & Pook agreed to try
its first toy sale.
...
Everyone in the toy world seemed to know the major consignor was Carter
Reese, longtime collector who bought toys that he loved before collectors got
hung up on condition. It didn’t matter to him if the toy had replaced figures, was
repainted, or if much of the paint was missing. If the toy had charm and was
cheap, he bought it.
“The sale was a good test of the middle market,” said dealer Jay Lowe of
Lancaster, Pennsylvania, who came to the sale and did some buying. The market
has changed; condition makes a big difference. It used to be if a toy was an 8.5 or
a 9, it could bring top dollar. Now it has to be 9.5 to 9.9 perfect, and if it isn’t, it
is not easy to sell, and the price differences are enormous.”
Lowe explained that’s because in the 1970’s and 1980’s toys were rare,
and fewer than 5% of the collectors wanted toys that were perfect. Now some
toys that were rare are not rare anymore, and 60% of the toy collectors want toys
to be 98% perfect.
“It’s the same thing with coins,” Lowe went on. “One coin might sell for
$1500, and one a little better goes for $3000, and one still better, $10,000. And it
is the same with furniture. A chest with a rich old surface will bring one price,
and one of the same forms that has been refinished [will bring] sixty to seventy
percent less. The pendulum has swung. Huge prices are paid for condition.”
Lowe remembered a time when he could buy a toy for $800 that was
missing a figure and needing a little repair and give it to a fellow to fix it and sell
it for $1500 and have made a nice profit. Not anymore. “Now I buy a toy for
17

torts are: (1) a false statement; (2) that the publisher either intends to cause pecuniary
loss or reasonably should recognize that publication will result in pecuniary loss; (3)
pecuniary loss does in fact result; and (4) the publisher either knows the published
statement is false or acts in reckless disregard of its truth or falsity.13 See Pro Golf Mfg.,
Inc. v. Tribune Review Newspaper Co., 809 A.2d 243, 246 (Pa. 2002) (elements of
commercial disparagement); McNulty v. Citadel Broad. Co., 58 Fed. App’x 556, 566 (3d

$800, and it costs me $400 to fix it, and I hope to sell it for $1500. Condition is
king,” he said.
...
The consensus was that may of the toys that Pook offered brought all they
were worth, and there were a lot of bargains for dealers who knew what they were
buying.
...
Condition drives all markets because collectors with deep pockets see
perfect toys as investments. There was very little for them at this middle-market
sale.
...
Some thought Pook should have employed a toy expert who would have
included condition reports in the lot descriptions as many specialty toy
auctioneers do, but others said the fact that this toy sale was not at a specialized
toy auctioneer brought out the trade, who thought they would have a chance to
make a discovery or two.
(ECF 25-2.)
13

Count VII, alleging injurious falsehood, also references Section 623A of the
Restatement (Second) of Torts. This section also has an actual malice element since it too
requires that the defendant “knows that the statement is false or acts in reckless disregard of its
truth or falsity.” (Id.) Finally, Count VII also references Restatement Section 626,
“Disparagement of Quality,” which specifically incorporates the “rules of liability . . . stated in §
623A.” Restatement (Second) of Torts § 626. Accordingly, I find that every iteration of the
injurious falsehood tort pled in Count VII contains an actual malice element.
18

Cir. 2003) (elements of common law injurious falsehood). The MAD Defendants argue
that the Reeses have failed to allege a plausible claim under either iteration of the tort
because they have not pled actual malice or any actual pecuniary loss arising from the
publication of the Article. I agree.
While acknowledging in the AC that the elements of both torts require them to
plead and prove actual malice, i.e., knowledge on the part of the publisher that the Article
was false or that the MAD Defendants acted in reckless disregard of its truth or falsity14
(see AC ¶¶ 134, 204, 214), the Reeses spend many pages of their Response asserting that
they are not “public figures,” and thus have no requirement to plead actual malice. (See
Resp. at 37-42.15) This argument is entirely inapposite; the two torts clearly require that a
plaintiff plausibly plead the actual malice element, irrespective of whether they are public
figures.
The only attempt the Reeses make to satisfy the pleading requirement is in
paragraph 134 of the AC where they state: “The article and its [sic] was published with
actual malice and/or a reckless disregard for the truth.” (AC ¶ 134.) The also assert that
its publication “violated . . . industry obligations and responsibilities,” and it “evidences
little to no editorial integrity — opting instead to be a puff piece for Lowe and his
newtiques.” (AC ¶¶ 133, 135.) I find that these allegations do not satisfy the
Twombly/Iqbal standard. First, merely alleging actual malice is insufficient; courts are
14

See New York Times Co. v. Sullivan, 376 U.S. 254, 279-80 (1964) (defining the actual
malice standard).
15

They also spend many pages asserting that they have suffered defamation, a claim they
have not pled in the AC. (See Resp. at 49-53.)
19

not bound to accept as true legal conclusions couched as factual allegations. Twombly,
550 U.S. at 555, 564. Second, the allegations concerning journalistic standards and
editorial integrity are likewise insufficient to put the MAD Defendants on notice of the
basis for the claim of actual malice and that the claim is plausible, absent any specific
examples of falsities in the Article that violated those standards. Third, the reference to
the Article being a “puff piece” for Lowe’s newtiques is implausible to demonstrate
actual malice as a matter of law since the Article never mentions newtiques.
Turning to the content of the Article, I conclude as a matter of law that the Reeses
cannot plausibly claim disparagement and actual malice. If anything, the Article was
critical only of P&P — noting its lack of experience in conducting toy auctions, its
failure to engage a toy expert to write condition reports, and that its inclusion of too many
lots in the auction may have resulted in “quite a few rarities sold under the money.” The
only references to the Reeses were that Carter bought toys “that he loved” rather than for
their condition (i.e., investment potential) and that “if the toy had charm and was cheap
he bought it.” The only reference to the quality of their collection is the quote from Lowe
describing the sale as a “good test of the middle market” (as opposed, one would assume,
to the high end of the collectible toy market). Nothing in the AC suggests that the MAD
Defendants were in possession of knowledge that would place a reasonable publisher on
notice that these statements were false or that they acted with reckless disregard for
whether they were true or false. Accordingly, Counts V and VII are dismissed as to the
MAD Defendants.

20

d.

Counts VI — False Light

A claim for false light is governed by the Restatement (Second) of Torts § 652E,
which provides:
One who gives publicity to a matter concerning another
that places the other before the public in a false light is
subject to liability to the other for invasion of his privacy if
(a) the false light in which the other was placed would be
highly offensive to a reasonable person, and
(b) the actor had knowledge of or acted in reckless
disregard as to the falsity of the publicized matter and the
false light in which the other would be placed.
Restatement (Second) of Torts § 652E (1977); Krajewski v. Gusoff, 53 A.3d 793, 805806 (Pa. Super. Ct. 2012), appeal granted, 74 A.3d 119 (Pa. 2013), appeal dismissed, 84
A.3d 1057 (Pa. 2014). For the information about a person to be “highly offensive,” it
must constitute a “major misrepresentation of his character, history, activities or beliefs
that serious offense may reasonably be expected to be taken by a reasonable man in his
position . . . .” Id. cmt. c.
Because the false light tort also has as an element the actual malice standard
required by commercial disparagement and injurious falsehood, I find that this claim too
has not been plausibly pled. Alternatively, I find the claim is also implausible as a matter
of law since the content of the Article would not be taken by reasonable persons in the
Reeses’ position to be highly offensive. As illustrations of material that would be highly
offensive, the comment to the Restatement offers: the police improperly including one’s
photograph in a “rogues gallery” of criminals when one was mistakenly arrested and

21

never convicted of a crime; and the use of a picture of a child who has been injured
through no fault of his own to illustrate an article captioned “They Ask to Be Killed.”
Referring to the Reeses’ toy collection as “middle market” does not rise to the same level
of offensiveness, and does not cast a similar level of adverse reflection on their character
or reputation. Thus, this claim against the MAD Defendants is also dismissed as
implausible.
e.

Counts IX — Negligence

Finally, the MAD Defendants argue that the negligence claim is subject to
dismissal. In Count IX, the Reeses allege only that “[a]s demonstrated above, in the best
light, Defendants have breached duties owed the Reeses and, as a result, the Reeses have
been injured, suffering actual damages.” (AC ¶ 228.) Defendants contend that since the
commercial disparagement and false light claims require a degree of fault greater than
negligence under Pennsylvania law, the Reeses “must allege a degree of fault . . . that is
greater than negligence.” (ECF 25 at 23.) In their Response, the Reeses fail to address
the negligence claim argument in any manner.
I find that this claim is subject to dismissal. Plaintiffs do not identify any specific
duty the MAD Defendants breached, other than the duty not to engage in commercial
disparagement or paint them in a false light. Under Pennsylvania law, “[t]o establish a
common law cause of action in negligence, ‘the plaintiff must demonstrate that the
defendant owed a duty of care to the plaintiff, the defendant breached that duty, the
breach resulted in injury to the plaintiff and the plaintiff suffered an actual loss or
damage.’” Brisbine v. Outside In School of Experiential Educ., Inc., 799 A.2d 89, 93
22

(Pa. Super. Ct. 2002) (quoting Brezenski v. World Truck Transfer, Inc., 755 A.2d 36, 40
(Pa. Super. Ct. 2000)). “All negligence claims are premised on the alleged violation of a
duty.” Peek v. Philadelphia Coca-Cola Bottling Co., Civ. A. No. 97-3372, 1997 WL
399379, at *5 (E.D. Pa. July 10, 1997) (citing Wenrick v. Schloemann–Siemag
Aktiengesellschaft, 564 A.2d 1244, 1248 (Pa. 1989). A duty is
that responsibility which exists by operation of law
requiring a person to adhere to a standard of conduct
protecting others against unreasonable or unnecessary
risks. In the absence of legal duty, no liability will attach,
even if a defendant’s conduct was negligent. In this sense,
the concept of legal duty is both a source of legal
responsibility, and a limitation upon liability to others:
recognition of a legal duty by the courts will impose
certain obligations, while refusal to recognize a legal duty
by the courts will insulate a party against liability. The
duty owed by a defendant may be express or implied, may
be general or arise from specific circumstances. In
determining the existence of a duty, the courts will look to
a variety of sources, including the common law, statutes,
or a contract between the parties. Ultimately, however, it
is the court’s decision whether to recognize a duty that is
fundamental to the existence of a negligence claim.
3 West’s Pa. Prac., Torts: Law and Advocacy § 1.2 (footnotes omitted).
Whatever duty the MAD Defendants owed to the Reeses to refrain from
publishing information that would constitute commercial disparagement or paint them in
a false light is necessarily coterminous with the duty owed to refrain from committing the
underlying torts. My findings that they have failed to allege plausible claims for those
torts foreclose their ability to proceed on a negligence theory since these are the sources
for any purported duty. More importantly, since this is a situation where liability for
negligence is premised upon the exercise of the MAD Defendants’ First Amendment
23

right to publish their magazine, the same rationale that led the United States Supreme
Court in Sullivan to impose the actual malice standard, rather than the common law
negligence standard, applies here since all of the underlying torts incorporate the
heightened standard in recognition that free speech rights are involved.
Accordingly, I grant the MAD Defendants’ Motion to Dismiss in its entirety.
VI.

LOWE’S AND CAFFARELLA’S MOTIONS TO DISMISS
In his Motion (ECF 27), Lowe argues that all claims contained in the AC in which

he is named as a defendant are subject to dismissal. In his Motion (ECF 30), Caffarella
joins many of Lowe’s arguments. I will discuss the two motion jointly; I will discuss
each claim in order.
a.

Count I — Conspiracy

The parties do not dispute that a claim of civil conspiracy in Pennsylvania contains
the following elements: (1) a combination of two or more persons acting with a common
purpose to do an unlawful act or to do a lawful act by unlawful means; (2) an overt act
done in pursuance of the common purpose; and (3) actual legal damage. Goldstein v.
Phillip Morris, Inc., 854 A.2d 585, 590 (Pa. Super. Ct. 2004). An ‘“actionable civil
conspiracy must be based on an existing independent wrong or tort that would constitute
a valid cause of action if committed by one actor.”’ Levin v. Upper Makefield Twp., 90
F. App’x 653, 667 (3d Cir. 2004) (quoting In re Orthopedic Bone Screw Prods. Liab.
Litig., 193 F.3d 781, 789 (3d Cir. 1999)). Ultimately, “only a finding that the underlying
tort has occurred will support a claim for civil conspiracy.” Alpart v. Gen. Land Partners,
Inc., 574 F. Supp. 2d 491, 506 (E.D. Pa. 2008) (quotation omitted); see also Duffy v.
24

Lawyers Title Ins. Co., 972 F. Supp. 2d 683, 698 (E.D. Pa. 2013) (“Absent a civil cause
of action for a particular act, there can be no cause of action for civil conspiracy to
commit that act.”). To allege a plausible claim of civil conspiracy, a plaintiff must make
“factual allegations of combination, agreement, or understanding among all or between
any of the defendants [or coconspirators] to plot, plan, or conspire to carry out the alleged
chain of events.” Spencer v. Steinman, 968 F. Supp. 1011, 1020 (E.D. Pa. 1997) (citation
and internal quotation marks omitted). It is not enough that the “end result of the parties’
independent conduct caused plaintiff harm or even that the alleged perpetrators of the
harm acted in conscious parallelism.” Id.
Lowe argues that the Reeses’ attempt to state a claim for civil conspiracy fails
because: (1) they do not identify the Defendants’ alleged common purpose or the
particular unlawful act that the Defendants were pursuing; rather Count I consists merely
of recitations of Pennsylvania case law along with the conclusory statement that
Defendants engaged in a conspiracy; and (2) Lowe, as well as Caffarella, were acting as
P&P’s consultants, were conducting the business of P&P, and “formed an indispensable
part of the company. Consequently, they cannot have conspired with the company. . . .”
(ECF 27 at 13.) Caffarella makes similar arguments. I find that the AC contains enough
factual matter, accepted as true, to create a plausible claim of civil conspiracy against
these two Defendants. I also find that the intracorporate conspiracy doctrine does not bar
the claim based on the allegations presented.

25

The substantive portion of Count I states, in its entirety, that “Pook16 as principal,
Caffarella as Pook’s agent, and Lowe combined or agreed with intent to do an unlawful
act, or to do an otherwise lawful act by unlawful means in the manner described above.”
(AC ¶ 163.) In other parts of the AC, the Reeses assert that Lowe and Caffarella
improperly set up the display at the auction to permit their own below-value purchases of
toys. They allegedly mixed unmatched parts of multi-part toys in different lots, reducing
the likelihood that other bidders, particularly phone and internet bidders, would perceive
the true value of the lots. They are alleged to have bid on lots using that inside
information, in order to later rematch the parts and create toys of greater value that they
could then sell at their own retail stand. (AC ¶¶ 56-75.) These allegations are sufficient,
if proven, to show concerted action between them, their common purpose, and an intent
to injure. See Thompson Coal Co. v. Pike Coal Co., 412 A.2d 466, 472 (Pa. 1979) (citing
Miller v. Post Publ’g Co., 110 A. 265 (Pa. 1920) (“Proof of malice i.e., an intent to injure,
is essential in proof of a conspiracy.”)
At this stage of the proceedings, I must also reject Lowe’s argument that he could
not as a matter of law have conspired with P&P or Caffarella.17 While Lowe is correct
that, for purposes of a civil conspiracy claim, a corporation cannot conspire with itself
through the activities of its own employees, officers, and directors, see Jagielski v. Pkg.
16

Count I of the AC does not state clearly to whom “Pook” refers. AC ¶ 16 states that
Ron and Debra Pook would be referred to collectively as the “Pooks.” AC ¶ 17 states that Pook
& Pook, Inc. would be referred to as “Pook & Pook.” The individual Pook family members are
referred to individually by their first names. (See AC ¶¶ 20-22.) I assume that the use of “Pook”
in Count I refers to P&P and not the individual Pook Defendants.
17

Caffarella has not joined this argument.
26

Mach. Co., 489 F. Supp. 232, 233 (E.D. Pa. 1980) (stating that under Pennsylvania law,
officers and employees of a corporation “cannot conspire with the corporation of which
they form an indispensable part”), the Reeses have not averred that Lowe or Caffarella
were P&P employees. They allege Lowe was involved “in multiple facets of the antique
industry,” an “expert, dealer, and purchaser,” the owner of his own antique business,
Caffarella’s partner in a consulting business, and had worked with Caffarella as an
independent contractor for another auction house. (AC ¶¶ 27, 31, 33, 85.) James Pook
allegedly told Carter Reese that P&P “was going to use a pair of ‘toy experts’ to assist
him” in the Reese auction, and that Carter confirmed that “Caffarella and, thus, Lowe,”
were to be those experts. (AC ¶¶ 53-54.) There is no allegation that Lowe or Caffarella
were P&P employees, and none of these alleged roles bring them within the
intracorporate conspiracy doctrine.
At best, Lowe can be deemed an agent of P&P acting in his individual capacity.
Judge Pratter recently had occasion to review the scope of the intracorporate conspiracy
doctrine in Cannon v. City & Cty. of Philadelphia, Civ A. No. 14-5388, 2014 WL
7399037 (E.D. Pa. Dec. 30, 2014). She stated:
Federal courts in the Third Circuit have explained that
agents acting in their individual capacities rather than their
official capacities can be liable for civil conspiracy. See,
e.g., Heffernan v. Hunter, 189 F.3d 405, 412-13 (3d Cir.
1999) (“[C]ourts that have followed the [intracorporate
conspiracy] doctrine allow an exception when the
employees have acted for their sole personal benefit and
thus outside the course and scope of their employment.
That exception is based on the proposition that since the
employer would not be subject to liability under
respondeat superior, it would not be a conspirator.”);
27

General Refractories Co. v. Fireman’s Fund Ins. Co., 337
F.3d 397, 313 (3d Cir. 2003); Robison v. Canterbury
Village, Inc., 848 F.2d 424, 431 (3d Cir. 1988) (noting that
a conspiracy may exist between a corporation and an
officer “if the officer is acting in a personal, as opposed to
official, capacity”); Lee v. SEPTA, 418 F. Supp. 2d 675,
681 (E.D. Pa. 2005) (“An employer and its officers and
employees acting in the scope of their duties constitute one
legal person for purposes of conspiracy law and therefore
cannot conspire together.” (emphasis added)). However,
“at least one panel of the Pennsylvania Superior Court, in a
nonprecedential decision, has opined that no such
‘exception’ to the intracorporate conspiracy doctrine ‘is
recognized by Pennsylvania state courts.”’ Accurso [v.
Infra-Red Servs., Inc.], 23 F. Supp. 3d [494] at 515 [E.D.
Pa. 2014] (quoting Lilly v. Boots & Saddle Riding Club,
No. 57 C.D.2009, 2009 WL 9101459, at *6 (Pa. Commw.
Ct. July 17, 2009)). Consequently, it is not clear whether
such an exception to the intracorporate conspiracy doctrine
exists in Pennsylvania law.
...
Pennsylvania courts have often applied the intracorporate
conspiracy doctrine without elaborating on its reasoning or
its relationship to the scope of employment, but they
ordinarily apply the doctrine when defendants allegedly
conspired with other agents or the principal corporation on
behalf of the principal corporation. See, e.g., Lackner [v.
Glosser,] 892 A.2d [21] at 26 [(Pa. Super. Ct. 2006)]
(alleging a conspiracy to engage in improper accounting
practices to deprive plaintiff of promised bonuses);
Rutherfoord v. Presbyterian-University [Hosp.], 417 Pa.
Super. 316, 612 A.2d 500, 502 (Pa. Super. Ct.1992)
(alleging a conspiracy to terminate plaintiff’s employment
with defendant company); Weiner v. Markel Int’l Ins. Co.,
No. 2005-1045, 2006 WL 1142484 (Pa. Ct. Comm. Pl.
Apr. 25, 2006) (alleging a conspiracy to refuse to pay
benefits); Rick’s Original Philly Steaks, Inc. v. Reading
Terminal Market Corp., No. 2008-3822, 2008 WL
1780822 (Pa. Ct. Comm. Pl. Feb. 20, 2008) (alleging
conspiracy between landlord and agent to refuse to renew
lease).
28

Cannon, 2014 WL 7399037, at *8-9. Judge Pratter went on to find persuasive the
“reasoning of the federal courts in Pennsylvania that have adopted a limited scope-ofemployment exception to the intracorporate conspiracy doctrine,” stating that “[i]t cannot
be the case that co-agents can never be liable for civil conspiracy — even if the alleged
conspiracy was outside the scope of their employment — merely because they happen to
be co-workers. There must be some connection between the alleged conspirators’ status
as co-agents and the alleged tort for the doctrine to preclude a finding of liability.” Id. at
*10.
Applying this rationale, I find that the Reeses’ civil conspiracy claim against Lowe
is not defeated by the alleged fact that Lowe assisted James Pook in setting up the
auction. There is no assertion in the AC that Lowe was employed by P&P, was engaged
by P&P as a consultant, or was conducting the business of P&P. What the Reeses have
pled is that Lowe owned his own independent antique business. Significantly, Lowe is
alleged to have undertaken his attempt to subvert the value of the auction lots to benefit
himself, not to benefit P&P (which arguably lost commission revenue on the auction as a
result of the depressed prices). There is, according, no basis to apply the intracorporate
conspiracy doctrine at this point in the proceedings to dismiss the civil conspiracy claim
against Lowe.

29

b.

Count II — Lanham Act

Lowe argues that Count II18 fails as a matter of law to state a claim under Section
43(a)(1)(B) of the Lanham Act, 15 U.S.C. § 1125(a)(1)(B) insofar as it concerns the
Article in which he was quoted. He argues that the Article merely recounted the events
of the auction after it occurred, and cannot, accordingly, constitute “commercial
advertising or promotion.” He also argues that he is not in commercial competition with
the Reeses. Caffarella argues that the claim fails because there are no allegations
whatsoever that he engaged in any kind of commercial speech. I find that Lowe is
correct when he asserts that the Article does not qualify as “commercial advertising or
promotion.” Caffarella is also correct that there is a complete failure to allege he engaged
in commercial speech.
As noted above, Lowe is quoted in the Article as stating, that,
“The sale was a good test of the middle market,” said
dealer Jay Lowe of Lancaster, Pennsylvania, who came to
the sale and did some buying. The market has changed;
condition makes a big difference. It used to be if a toy
was an 8.5 or a 9, it could bring top dollar. Now it has to
be 9.5 to 9.9 perfect, and if it isn’t, it is not easy to sell,
and the price differences are enormous.”
(ECF 25-2.) He opined that, while in the past few collectors desired perfect toys, as with
collectors of other antiques, the majority of the toy collectors now desire perfect
examples and “[c]ondition is king.” (Id.) Taken in the light most favorable to the
18

As I previously noted, although Count II does not mention him, Lowe has raised an
argument why the claim should be dismissed. There is no allegation that Lowe was responsible
for the placement of his newtique on the cover of the sale catalogue. Accordingly, I limit the
discussion of liability to the allegedly negative comment in the Article about the quality of the
Reeses’ collection sold at the auction, based upon Lowe’s quotes in the Article.
30

Reeses, Lowe was quoted in an Article reporting on events that had already occurred,
wherein he opined that the quality of their toys were middle market and failed to bring
top dollar because of their less-than-perfect condition. He did not opine on the quality of
the Reeses’ remaining toy collection, or on the quality of his own inventory of toys, he
did not write or publish the Article, there is no allegation he was responsible for its
editorial content, and the Article contained no advertisement or promotion of Lowe’s toy
business. Given this, I find that the Reeses have failed to state a plausible violation of
Section 43(a). There is simply no basis to conclude that Plaintiffs have plausibly alleged
the Article constituted commercial speech, let alone Lowe’s or Caffarella’s commercial
speech, or that it was designed to influence customers to buy Defendants’ products.
c.

Counts III, V and VII — Unfair Competition, Commercial Disparagement
and Injurious Falsehood

Lowe and Caffarella argue that, to the extent that these claims reference the P&P
auction that occurred on September 6-7, 2013, they are time barred because each such
claim is subject to a one year statute of limitations,19 and the Reeses did not file this
action until October 7, 2014. As the Reeses make no argument in their Response to show
that this part of the claims are timely, I find they are subject to dismissal.
To the extent that the claims reference the Article, Lowe contends that his
comments quoted therein did not address the Reeses personally, nor any specific item
19

See 42 P.S.A. § 5523 (providing one year statute of limitation on claims of commercial
disparagement, false light and injurious falsehood); Pro Golf Mfg., 809 A.2d at 245 (holding that
“one-year limitations period found in Section 5523(1) governs an action for commercial
disparagement”); Little v. City & Cty. of Philadelphia, Civ. A. No. 07-5361, 2008 WL 2704579,
at *4 (E.D. Pa. July 3, 2008) (holding that false light claim is subject to a one-year statute of
limitations of Section 5523).
31

consigned by the Reeses in the P&P auction, but merely constituted a general description
of antique toy market at that time and how items are valued by market participants. As
such, he contends, his comments were not defamatory as a matter of law so as to support
claims for unfair competition, commercial disparagement or injurious falsehood.
Caffarella argues that the claims fails because he is not alleged to have engaged in any
disparaging speech. I agree.
For reasons similar to those discussed above with regard to the MAD Defendants,
I find that all of these claims are implausible because they do not rise to the level of
actual malice. First, Lowe did not write the Article; thus, he can only be responsible for
his own statements — which I assume are accurately quoted — and not the Article’s
editorial content and opinions. Most significantly, this would exclude the identification
of the Reeses as the consignor of the toys, a statement not attributed by the author to
Lowe. Thus, there is a clear break in the causation between Lowe and any alleged
impugning of the Reeses’ collection in the Article. Second, the Reeses have failed to
assert that, in making his statements, Lowe uttered something he knew was false or was
stated in reckless disregard of its truth or falsity. As noted, the allegation that the Article
was a “puff piece” for Lowe’s newtiques, even if it could be attributed to Lowe, is
implausible to demonstrate actual malice as a matter of law since the Article never
mentions newtiques. Third, the allegedly defamatory statement central to the claim, that
Carter bought toys “that he loved” rather than for their condition, is not attributed to
Lowe. Fourth, I find that the implication that the Reeses’ collection was not high quality,
which allegedly arises from Lowe describing the sale as a “good test of the middle
32

market,” is not “highly offensive” as a matter of law so as to support a false light claim,
since it is not a “major misrepresentation of [] character, history, activities or beliefs that
serious offense may reasonably be expected to be taken by a reasonable man.”
Restatement (Second) of Torts § 652E cmt. c. As suggested above with regard to the
MAD Defendants, referring to the Reeses’ toy collection as “middle market” does not
rise to the same level of offensiveness as the examples listed in the Restatement, and does
not cast a similar level of adverse reflection on their character or reputation. Finally,
there is no allegation that Caffarella engaged in any allegedly disparaging speech.
Accordingly, Counts III, V and VII are dismissed as to Lowe and Caffarella.
d.

Count IV — Antitrust Claims

In Count IV, the Reeses allege Lowe and Caffarella, along with P&P and the Pook
Defendants, violated the Sherman Act and the Clayton Act, as well as Section 2(c) of the
Robinson-Patman Act. (AC ¶¶ 188-200.) Other than recitations of the various antitrust
statutes, the only allegation contained in Count IV is that the “poor Pook & Pook sale
preparation by Lowe/Caffarella was intentional, aimed at ensuring they and others could
piecemeal make a killing off of the Reeses by purchasing seemingly disparate lots that,
when combined, contained complete toys and ‘rare finds’ worth thousands of dollars
more than the entire lot was purchased for.” (AC ¶ 198.) Lowe, joined by Caffarella,
argues that the Count is subject to dismissal because the Reeses have completely failed to
allege antitrust injury. I agree.
Section 1 of the Sherman Act states that “[e]very contract, combination in the
form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the
33

several States, or with foreign nations, is hereby declared to be illegal.” 15 U.S.C. § 1.
Section 4 of the Clayton Act, in turn, grants the right to maintain a private cause of action
to “[a]ny person who shall be injured in his business or property by reason of anything
forbidden in the antitrust laws.” 15 U.S.C. § 15(a). As these sections imply, standing
and antitrust injury are essential elements to maintaining an action for damages
thereunder. See, e.g., Cargill, Inc. v. Monfort of Colorado, Inc., 479 U.S. 104, 110
(1986). Under Section 1, a plaintiff must plausibly allege the following three elements:
(1) an agreement; (2) imposing an unreasonable restraint of trade within a relevant
product market; and (3) resulting in antitrust injury.” In re Ins. Brokerage Antitrust
Litig., 618 F.3d 300, 315 (3d Cir. 2010). Antitrust injury consists of (1) harm of the type
the antitrust laws were designed to prevent; and (2) an injury which flows from that
which makes defendants acts unlawful. Brunswick Corp. v. Pueblo Bowl-O-Mat, Inc.,
429 U.S. 477, 489 (1977); Gulfstream III Assoc., Inc. v. Gulfstream Aerospace Corp.,
995 F.2d 425, 429 (3rd Cir. 1993). To be an antitrust injury, the injury must “reflect the
anticompetitive effect either of the violation or of the anticompetitive acts made possible
by the violation” and represent “the type of loss that claimed violations. . . would be
likely to cause.” Brunswick Corp, 429 U.S. at 489; Race Tires of Am. Inc. v. Hoosier
Racing Tire Corp., 614 F.3d 57, 76 (3d Cir. 2010); City of Pittsburgh v. West Penn
Power Co., 147 F.3d 256, 266 (3d Cir. 1998). “While a plaintiff may have individually
suffered an injury as a result of defendants’ actions, the antitrust laws were designed to
protect market-wide anticompetitive activities.” Eichorn v. AT&T Corp., 248 F.3d 131,

34

140 (3d Cir. 2001), amended (June 12, 2001) (citing Atl. Richfield Co. v. USA Petroleum
Co., 495 U.S. 328, 338 (1990)).
The Reeses make no attempt to tie the alleged wrongdoing of Lowe, Caffarella
and P&P to any market-wide anticompetitive impact. Notably, they don’t even attempt
to define the relevant product market and the relevant geographic market. Count IV
merely restates the Defendants’ alleged improper conduct of the auction under the guise
of an antitrust claim without any allegation of the specific antitrust law elements that
create such a claim. As such, I conclude the claim is implausible and subject to
dismissal.20

20

Although Plaintiffs quote Section 2(c) of the Robinson-Patman Act in the AC, neither
side has addressed Count IV in terms of this statute. It provides:
(c) It shall be unlawful for any person engaged in commerce, in the course of such
commerce, to pay or grant, or to receive or accept anything of value as a
commission, brokerage, or other compensation, or any allowance or discount in
lieu thereof, except for services rendered in connection with the sale or purchase
of goods, wares, or merchandise, either to the other party to such transaction or to
an agent, representative, or other intermediary therein where such intermediary is
acting in fact for or on behalf, or is subject to the direct or indirect control, of any
party to such transaction other than the person by whom such compensation is so
granted or paid.
15 U.S.C. § 13(c). This provision “was designed to eliminate the competitive advantage large
buyers and sellers attained over their smaller competitors by virtue of their economic clout and
bargaining power.” Stephen Jay Photography, Ltd. v. Olan Mills, Inc., 903 F.2d 988, 991 n. 5
(4th Cir. 1990). Section 2(c) “encompasses cases of commercial bribery tending to undermine
the fiduciary relationship between a buyer and its agent, representative, or other intermediary in a
transaction involving the sale or purchase of goods.” Harris v. Duty Free Shoppers Ltd. P’ship,
940 F.2d 1272, 1274 (9th Cir. 1991) (citation omitted). For a finding of commercial bribery,
plaintiff “must show that the illegal payments in question crossed the line from buyer to seller or
vice-versa.” Envtl. Tectonics v. W.S. Kirkpatrick, Inc., 847 F.2d 1052, 1066 (3d Cir. 1988),
aff’d, 493 U.S. 400 (1990); see also Ellwood City v. Pennsylvania. Power Co., 570 F. Supp. 553,
562 (W.D. PA. 1983) (noting “intrastate sales are subject to the Robinson–Patman Act as long as
the sales remain in the flow of interstate commerce”). The AC also cites and quotes 15 U.S.C. §
13a, prohibiting price discrimination.
35

e.

Counts VIII — Breach of Fiduciary Duty

Lowe argues that Count VIII’s claim for breach of fiduciary duty — in which the
Reeses claim that “the Pook Defendants — including Caffarella” had a fiduciary
relationship to them, is subject to dismissal under the “gist of the action doctrine” and
because it fails to state claims upon which relief may be granted.
I note, preliminarily, that Count VIII by its own terms does not name Lowe as one
who would be liable. There is no allegation that he was in a fiduciary relationship with
the Reeses. Further, in their omnibus Response, the Reeses do not raise any argument
that Lowe is liable under Count VIII. (See ECF 31 at 66-70.) Accordingly, I the claim is
dismissed to the extent that it might be construed as a claim against Lowe.
Caffarella argues the claim is implausible because any fiduciary relationship
existed only between the Reeses and P&P, the entity with whom they contracted to
conduct the sale. He argues there have been no facts alleged to suggest that he owed any
such duty, that he had any form of contractual relationship with them, or that they had
placed any trust or confidence in him, such that a fiduciary relationship could be deemed
to exist. Indeed, he notes, Plaintiffs have alleged they told P&P they did not want
Caffarella involved in the sale. (See AC ¶¶ 54-55.)
To allege a breach of fiduciary duty, Plaintiffs must assert that a fiduciary or
confidential relationship existed between themselves and Defendants. Baker v. Family
Credit Counseling Corp., 440 F. Supp. 2d 392, 414 (E.D. Pa. 2006) (citing Harold v.

Because there is no allegation of commercial bribery or price discrimination, I find these
aspects of Count IV are also subject to dismissal.
36

McGann, 406 F. Supp. 2d 562, 571 (E.D. Pa. 2005). “Although no precise formula has
been devised to ascertain the existence of a confidential relationship, it has been said that
such a relationship exists whenever one occupies toward another such a position of
advisor or counselor as reasonably to inspire confidence that he will act in good faith for
the other’s interest.” Id. (quoting Silver v. Silver, 219 A.2d 659, 662 (Pa. 1966); see also
Basile v. H & R Block, Inc., 777 A.2d 95, 101-02 (Pa. Super. Ct. 2001). To allege a
breach of that duty, Plaintiffs must allege (1) that the Defendants negligently or
intentionally failed to act in good faith and solely for the benefit of Plaintiffs in all
matters for which they were employed; (2) that Plaintiffs suffered injury; and (3) the
Defendants’ failure to act solely for the Plaintiffs’ benefit was a real factor bringing about
Plaintiffs’ injuries. Id. at 414-415 (citing McDermott v. Party City Corp., 11 F. Supp. 2d
612, 626 n.18 (E.D. Pa. 1998). I find that the Reeses have failed to allege the plausible
existence of a fiduciary relationship.
In their Response, the Reeses discuss at length the terms of their agreement with
P&P and how they placed their trust in P&P, in an attempt to establish that the company
exercised absolute control over the auction. (ECF 31 at 66-70.) Notably absent from that
discussion, however, is any mention of how that agreement, to which Caffarella was not a
party, created a fiduciary duty between themselves and Caffarella. They cannot plausibly
assert that they placed trust in Caffarella when they allege and argue that P&P had
absolute control over the auction and that it violated that trust by utilizing Caffarella’s
services against their wishes. Accordingly, Count VIII is dismissed against both
Defendants.
37

e.

Count IX — Negligence

Count IX’s negligence claim, as noted earlier, appears to assert that all defendants
are liable. Lowe argues that it is barred by the gist of the action doctrine because the
negligence allegedly arises out of duties imposed by the contract the Reeses signed with
P&P. I find this argument is meritless and the negligence claim survives.
The gist of the action doctrine applies to tort claims: “(1) arising solely from a
contract between the parties; (2) where the duties allegedly breached were created and
grounded in the contract itself; (3) where the liability stems from a contract; or (4) where
the tort claim essentially duplicates a breach of contract claim or the success of which is
wholly dependent on the terms of the contract.” Hults v. Allstate Septic Sys., L.L.P., Civ.
A. No. 06-0541, 2007 WL 2253509, at *10 (M.D. Pa. Aug. 3, 2007) (citing Hart v.
Arnold, 884 A.2d 316, 340 (Pa. Super. Ct. 2005)). The principle underlying the doctrine
is that a tort action derives from “the breach of duties imposed as a matter of social
policy,” whereas a breach of contract action stems from “the breach of duties imposed by
mutual consensus.” Redevelopment Auth. of Cambria Cnty. v. Int’l Ins. Co., 685 A.2d
581, 590 (Pa. Super. Ct. 1996).
The obvious flaw in Lowe’s gist of the action argument is that there is no
allegation that there is “a contract between the parties.” Indeed, Lowe himself argues that
the Reeses’ breach of contract claim must be dismissed because he is not a party to any
contract with them. (See ECF 27 at 32.) Lowe was not a signatory to the Reese/P&P
contract. There is no assertion that his liability to the Reeses stems from a contract or
that the breach of duty underlying the negligence claim against him duplicates duties
38

owed by a contract. None of the cases he cites involves an application of the doctrine
where the parties were not bound by a contract. See Hart, 884 A.2d at 316 (contract for
sale of land); Bash v. Bell Tel. Co., 601 A.2d 825, 830 (Pa. Super. Ct. 1992) (contract for
yellow pages ad); eToll, Inc. v. Elias/Savion Adver., Inc., 811 A.2d 10 (Pa. Super. Ct.
2002) (contract to market and advertise product); The Brickman Grp., Ltd. v. CGU Ins.
Co., 865 A.2d 918 (Pa. Super. Ct. 2004) (insurance contract).
The duty allegedly breached arises not from P&P’s agreement to conduct the
auction, but from Lowe’s alleged conduct in improperly manipulating the content of the
auction lots, dividing multi-part toys into separate lots to discourage interest by others
bidders and thereby obtain the merchandize more cheaply for himself. I find that the
Reeses have alleged a plausible negligence claim based on these allegations.
Caffarella argues that the claim is implausible because any work he performed for
the auction was done in his capacity as a contractor engaged to perform work on behalf of
P&P. Thus, he contends, he did not owe an independent duty of care to the Reeses. He
cites no authority for his implied proposition that an employee/contractor/agent can never
as a matter of law be negligent where the injured party has also sued his principal. Nor
could he.
Plaintiffs in a negligence action are allowed to recover from both a principal and
his agent under Pennsylvania law. See, e.g., Milton S. Hershey Med. Ctr. of Pa. State
Univ. v. Commonwealth Med. Prof’l Liab. Catastrophe Loss Fund, 821 A.2d 1205, 1212
(Pa. 2003) (providing that a plaintiff may seek relief in tort from both an agent and his
principal under a theory of vicarious liability) (citing Mamalis v. Atlas Van Lines, Inc.,
39

560 A.2d 1380, 1383 (Pa. 1989)). Under Pennsylvania law, employees are liable for their
own torts, even if they were acting within the scope of their employment when they
engaged in the tortious conduct in question. See Pilot Air Freight Corp. v. Sandair, Inc.,
118 F. Supp. 2d 557, 564 (E.D. Pa. 2000); Cosmas v. Bloomingdales Bros., Inc., 660
A.2d 83, 88-89 (Pa. Super. Ct. 1995) (observing “[a]n agent who does an act otherwise a
tort is not relieved from liability by the fact that he acted at the command of the principal
or on account of the principal” (citation omitted)). Pennsylvania law recognizes the
participation theory, under which a corporate officer, employee, or other agent “who
takes part in the commission of a tort by the corporation is personally liable therefor.”
Wicks v. Milzoco Builders, Inc., 470 A.2d 86, 90 (Pa. 1983) (citation omitted); see also
Sannuti v. Starwood Hotels & Resorts Worldwide, Inc., Civ. A. No. 14-587, 2014 WL
1515650, at *2 (E.D. Pa. Apr. 16, 2014). To be liable under this theory, the corporate
agent must have “participate[d] in the wrongful acts,” a requirement the Pennsylvania
courts have interpreted to permit liability for an agent’s misfeasance, but not for “mere
nonfeasance.” Wicks, 470 A.2d at 90. Misfeasance consists of “the doing of something
which ought not to be done, something which a reasonable man would not do, or doing it
in such a manner as a man of reasonable and ordinary prudence would not do it.”
Sannuti, 2014 WL 1515650, at *2 (quoting Brindley v. Woodland Vill. Rest., Inc., 652
A.2d 865, 868-70 (Pa. Super. Ct. 1995)).
That is exactly what the Reeses have alleged. They plausibly contend that
Caffarella’s misfeasance in manipulating the auction lots constituted negligence. I find

40

that the fact that he is alleged to have been a consultant for P&P is irrelevant to whether
he owed the Reeses a duty of care not to act improperly.
f.

Count X — Breach of Contract

As stated above, neither Lowe nor Caffarella are parties to any contract with the
Reeses. They seek to dismiss Count X for that reason. I agree. Neither Defendant is
specifically named in Count X, they are not listed as parties to the only contract at issue,
and the Reeses do no argue that there is any contract in existence between these
Defendants and themselves.
g.

Count XI — Unjust Enrichment

The Reeses allege that “. . . Caffarella, and Lowe jointly benefited, and continue to
benefit, from exploitation Plaintiffs [sic]. . . . Plaintiffs have conferred upon Defendants
economic opportunity and actual economic benefit, in the nature of profits resulting from
unlawful auction practices and other conduct described above, to the economic detriment
of Plaintiffs.” (AC ¶¶ 239-240.) They assert it would be inequitable to permit
Defendants to retain that profit, and seek an order of disgorgement. (Id. ¶¶ 241-242.)
Lowe and Caffarella argue that the doctrine of unjust enrichment has no application to
this dispute because the Reeses did not undertake any act or intentionally confer any
benefit upon them. (ECF 27 at 33-34; ECF 30 at unnumbered page 7.) I find that the
Reeses have stated a plausible unjust enrichment claim against Lowe and Caffarella.
As Judge O’Neill wrote:
a claim of unjust enrichment must allege the following
elements: (1) plaintiff conferred a benefit on the
defendant; (2) the defendant appreciated the benefit; and
41

(3) acceptance and retention by the defendant of the
benefits, under the circumstances, would make it
inequitable for the defendant to retain the benefit without
paying for the value of the benefit. Com. ex. rel. Pappert
v. TAP Pharm. Prods., Inc., 885 A.2d 1127, 1137 (Pa.
Commw. 2005). See also, Torchia v. Torchia, 346 Pa.
Super. 229, 499 A.2d 581, 582 (1985) noting that “to
sustain a claim of unjust enrichment, a claimant must
show that the party against whom recovery is sought
either wrongfully secured or passively received a benefit
that it would be unconscionable for her to retain.”
(internal quotation omitted). “The polestar of the unjust
enrichment inquiry is whether the defendant has been
unjustly enriched; the intent of the parties is irrelevant.”
Limbach v. City of Phila., 905 A.2d 567, 577 (Pa.
Commw. 2006). “In order to recover, there must be both
(1) an enrichment, and (2) an injustice resulting if
recovery for the enrichment is denied.” Samuels v.
Hendricks, 300 Pa. Super. 11, 445 A.2d 1273, 1275
(1982) (emphasis in original), quoting Meehan v.
Cheltenham Twp., 410 Pa. 446, 189 A.2d 593, 595
(1963).
Global Ground Support, LLC v. Glazer Enter., Inc., 581 F. Supp. 2d 669, 675-76 (E.D.
Pa. 2008). The Reeses have alleged both an enrichment and an injustice. Lowe and
Caffarella allegedly enriched themselves — i.e., received a benefit — by manipulating
the auction lots to discourage bidding and pay artificially low prices on toys they later
resold for a profit. The AC plausibly alleges that they appreciated the benefit and that
their retention of the benefit, under the circumstances, would be inequitable.
Accordingly, Count XI survives as to Lowe and Caffarella.
VII.

CONCLUSION
In conclusion, the claims against P&P and the individual Pook Defendants are

subject to dismissal in their entirety. The MAD Defendants’ Motion is also granted in its

42

entirety. Lowe’s Motion to dismiss is granted as to Counts II (Lanham Act), III (unfair
competition), IV (antitrust claims), V (commercial disparagement), VI (false light), VII
(injurious falsehood), VIII (breach of fiduciary duty), and X (breach of contract);
Caffarella’s Motion is granted as to these same counts, save Count VIII’s claim of breach
of fiduciary duty. Thus, only Lowe and Caffarella remain as defendants. The claims that
remain against Lowe are Count I (conspiracy), IX (negligence), and XI (unjust
enrichment). 21 The claims that remain against Caffarella are Count I (conspiracy), VIII
(breach of fiduciary duty), IX (negligence), and XI (unjust enrichment).
An appropriate Order follows.

21

Lowe also argues that many provisions of the AC should be struck under Federal Rule
of Civil Procedure 12(f) because they constitute immaterial, impertinent and scandalous material.
(ECF 27 at 34.) Rule 12(f) provides: “[t]he court may strike from a pleading an insufficient
defense or any redundant, immaterial, impertinent, or scandalous matter.” Fed. R. Civ. P. 12(f).
“Motions to strike function ‘to clean up the pleadings, streamline litigation, and avoid
unnecessary forays into immaterial matters.’” Mitchell v. Cmty. Educ. Ctrs., Inc., Civ. A. No.
14-5026, 2015 WL 4770652, at *11 (E.D. Pa. Aug. 11, 2015) (quoting McInerney v. Moyer
Lumber & Hardware, Inc., 244 F. Supp. 2d 393, 402 (E.D. Pa. 2002)). “‘The standard for
striking a complaint or a portion of it is strict, and only allegations that are so unrelated to the
plaintiffs’ claims as to be unworthy of any consideration should be stricken.’” Ford-Greene v.
NHS, Inc., Civ. A. No. 14-5846, 2015 WL 2395409, at *21 (E.D. Pa. May 20, 2015) (quoting
Steak Umm Co., LLC v. Steak ‘Em Up, Inc., Civ. A. No. 09-2857, 2009 WL 3540786, at *2
(E.D. Pa. Oct. 29, 2009)). Consequently, “[m]otions to strike are generally disfavored by courts
and will be denied unless the allegations ‘have no possible relation to the controversy and may
cause prejudice to one of the parties, or if the allegations confuse the issues in the case.’”
Mitchell, 2015 WL 4770652, at *11 (quoting Natale v. Winthrop Res. Corp., Civ. A. No. 074686, 2008 WL 2758238, at *14 (E.D. Pa. July 9, 2008)).
Many of the provisions Lowe seeks to strike use bright purple prose to describe the
Defendants’ actions. Most of it, however, I find is related to the allegations of the claims that I
find can survive. However, the Motion is due to be granted as to the following material: (1)
Heading “V. Pooling” and ¶¶ 81-82 (describing an alleged 1987 conviction suffered by Ron
Pook ; and (2) Heading “VII. The ‘Second Rape’ of the Reeses.” None of this material is
related to the surviving claims and may cause prejudice or confusion.
43