Nigerians in Diaspora Organization Americas v. Ogbonnia et al

Filing 25

MEMORANDUM OPINION granting in part, denying in part 18 First MOTION to Dismiss Defendants (Signed by Magistrate Judge Nancy K Johnson) Parties notified.(sjones, 4)

United States District Court
Southern District of Texas

ENTERED
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION
NIGERIANS IN DIASPORA
ORGANIZATION AMERICAS,

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Plaintiff,
v.
SKC OGBONNIA, HENRY CHIWUIKEM
IHEDIWA, AUDU ALI,
Defendants.

October 10, 2017
David J. Bradley, Clerk

CIVIL ACTION NO. H-16-3633

MEMORANDUM OPINION
Pending before the court1 is Defendants’ Motion to Dismiss
(Doc. 18).

The court has considered the motion, Plaintiff’s

response, all other relevant filings, and the applicable law.

For

the reasons set forth below, the court GRANTS IN PART AND DENIES IN
PART Defendants’ motion.
I.
Nigerians

in

Case Background

Diaspora

Organization

Americas

(“NIDOA”

or

“Plaintiff”), a national nonprofit organization, filed this lawsuit
against former members of Plaintiff’s Houston chapter, alleging
trademark infringement and false advertisement under federal law
and defamation of character under Texas law.2
Prior to October 2015, Defendants were leaders of the Houston

1

The parties consented to proceed before the undersigned magistrate
judge for all proceedings, including trial and final judgment, pursuant to 28
U.S.C. § 636(c) and Federal Rule of Civil Procedure 73. See Doc. 21, Ord. Dated
Mar. 24, 2017.
2

See Doc. 1, Pl.’s Compl.

chapter of NIDOA and were authorized to use Plaintiff’s registered
marks in the execution of the organization’s mission.3

In its

complaint, Plaintiff explained the dispute:
Soon after Defendants began using the protected brand and
mark, their approach to organizing the Houston Chapter
left members with . . . more questions than answers as to
their intent in building a[n] NIDOA chapter in Houston.
. . . Between November 2015 and May 2016, Defendants
operated the NIDOA Houston chapter as their private
organization, at odds with the members of the chapter,
taking actions that could be in contradiction with the
mission of the organization and refused to properly
account to the membership regarding expenses and
disbursement carried out by the Defendants.4
Efforts to “broker peace” were not successful and, in May
2016, “Plaintiff dissolved the Houston executives and relieved
Defendants of their office[s].”5

Plaintiff directed Defendants to

turn over property belonging to the Houston chapter, but Defendants
refused.6

Instead,

Defendants

sent

out

publications

and

directives, held meetings, and converted NIDOA property.7
In June 2016, Defendant Henry Chiwuikem Ihediwa (“Ihediwa”)
distributed a press release that “impugn[ed] the character and
activities

of

NIDOA

leadership

3

See id. p. 5.

4

Id.

5

Id.

6

See id. pp. 5-6.

7

Id. p. 6.

2

and

falsely

stated

that

the

leadership ha[d] been dissolved.”8

In response, NIDOA’s legal

adviser demanded that Defendants withdraw the publication, but,
rather than complying with the demand, Defendant SKC Ogbonnia
(“Ogbonnia”) published the release to more outlets.9

Defendants

continued the unauthorized use of Plaintiff’s registered marks and
communicated with the Consulate General of Nigeria.10
On June 7, 2016, the Houston chapter sued NIDOA’s national
president/chairman,

Gabriel

George

(“George”),

and

general

secretary, Apollos Nwauwa (“Nwauwa”), in the 127th District Court
of Harris County, Texas.11

On June 17, 2016, Plaintiff sued

Defendants in the United States District Court for the District of
Columbia.12

On August 1, 2016, the District of Columbia suit was

dismissed for lack of personal jurisdiction and improper venue.13
On December 12, 2016, Plaintiff refiled in this district the
same federal lawsuit that had been dismissed in the District of
Columbia.14

As in that lawsuit, Plaintiff raised federal claims of

8

Id.

9

See id.

10

Id.

11
Doc. 18, Defs.’ Mot. to Dismiss p. 2. Defendants also state that
“Ebenezer Anene and Bridget Akazie[] were named as agents and officers of the
Houston officials to the National Chapter of NIDOA.” Id.
12

See id.

13

See NIDOA v. Ogbonnia, et al., Civ. Action No. 16-cv-1174 (TSC)
(D.D.C. Aug. 1, 2016), Doc. 15, Mem. Op.
14

See Doc. 1, Pl.’s Compl.

3

trademark infringement and false advertisement on its own behalf
and claims of defamation of character on behalf of George and
Nwauwa, who were members of Plaintiff’s board of directors, as well
as second member of NIDOA’s board of directors and one member of
its board of trustees.15

No members were named as plaintiffs.16

Plaintiff requested injunctive relief and monetary damages on its
own behalf and for each allegedly defamed NIDOA member.17
On March 22, 2017, Defendants filed the pending motion to
dismiss and sought sanctions in the amount of $5,750 for attorney’s
fees and costs associated with defending the federal actions,
arguing that they were filed in retaliation for Defendants’ filing
of the state action and/or as harassment.18
II.

Dismissal Standard

Pursuant to the federal rules, dismissal of an action is
appropriate whenever the court lacks subject matter jurisdiction.
Fed.

R.

Civ.

P.

12(b)(1);

12(h)(3).

A

district

court’s

jurisdiction is limited to actual cases or controversies. Lujan v.
Defenders of Wildlife, 504 U.S. 555, 559 (1992). “[S]tanding is an
essential

and

unchanging

requirement . . . .”

part

of

the

case-or-controversy

Id. at 560; see also McCall v. Dretke, 390

15

See id. p. 9.

16

See Doc. 1, Pl.’s Compl.

17

See id. pp. 7-8, 10-11.

18

See Doc. 18, Defs.’ Mot. to Dismiss.

4

F.3d 358, 361 (5th Cir. 2004)(explaining that standing is an
essential component of federal subject matter jurisdiction).
Federal Rule of Civil Procedure (“Rule”) 8(a) requires only
short and plain statements of the grounds for jurisdiction and the
claims asserted and a demand for the relief sought.

Rule 8(d)(1)

requires that the allegations be “simple, concise, and direct.”
Rule 12(b)(6) allows dismissal of an action whenever the
complaint, on its face, fails to state a claim upon which relief
can be granted.

When considering a motion to dismiss, the court

should construe the allegations in the complaint favorably to the
pleader and accept as true all well-pleaded facts.

Harold H.

Huggins Realty, Inc. v. FNC, Inc., 634 F.3d 787, 803 n.44 (5th Cir.
2011)(quoting True v. Robles, 571 F.3d 412, 417 (5th Cir. 2009)).
A complaint need not contain “detailed factual allegations” but
must include sufficient facts to indicate the plausibility of the
claims asserted, raising the “right to relief above the speculative
level.”

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007); see

also Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
When alleging fraud or mistake, a plaintiff must state the
circumstances with particularity.

Fed. R. Civ. P. 9(b).

III. Analysis
Defendants raise several arguments in support of their motion
to

dismiss,

12(b)(6).

referencing

Rules

8(a),

8(d)(1),

9(b),

12(b)(1),

Defendants’ motion does not include any discussion of

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Rule 9(b), and Plaintiff’s complaint does not assert any claim
based on fraud or mistake.

Defendants’ Rule 9(b) argument has no

relevance or merit.
Defendants’ argument based on Rule 12(b)(1) is that Plaintiff
does not have standing to assert claims on behalf of its individual
members.

Citing Warth v. Seldin, 422 U.S. 490, 511 (1975),

Plaintiff contends that it does have standing to assert the claims
of its board members even where it has suffered no injury itself
from the challenged activity.
The Fifth Circuit addressed and applied the teachings of Warth
in Association of American Physicians & Surgeons, Inc. v. Texas
Medical Board, 627 F.3d 547, 550-53 (5th Cir. 2010).

The court

explained when an association has standing to sue on behalf of its
members: “when: (a) its members would otherwise have standing to
sue in their own right; (b) the interests it seeks to protect are
germane to the organization’s purpose; and (c) neither the claim
asserted nor the relief requested requires the participation of
individual members in the lawsuit.”

Id. at 550. (citing Hunt v.

Wash. St. Apple Advert. Comm’n, 432 U.S. 333, 343 (1977)).

The

first two of the three requirements are constitutional, and the
third is prudential.

Id. (citing United Food & Comm’l Workers

Union Local 751 v. Brown Grp., Inc., 517 U.S. 544, 555 (1996)).
The third requirement is not met where the association seeks
“damages running solely to its members.”

6

Id. at 551.

The

Fifth

that

the

association in that case met the constitutional requirements.

See

id. at 550.
that

the

Circuit

found,

without

discussion,

Turning to the third requirement, the court stated

court’s

focus

was

on

“matters

of

administrative

convenience and efficiency” and that the assessment of whether the
prong was met should be based on “the relief requested and the
claims asserted.”

Id. at 551.

Because the relief sought in that

case was equitable and the association was positioned to present
evidence from a small sample of affected members, the court
determined that judicial efficiency could be achieved through
associational standing.

See id. at 552-53.

Here also, Plaintiff meets the first two requirements as
Plaintiff’s members would have standing in their own rights and the
interests Plaintiff seeks to protect, to wit, the reputation of the
NIDOA, is germane to its purpose.

However, in contrast to the

facts of the Fifth Circuit case, the relief sought on behalf of the
four NIDOA members is monetary for “unimaginable pain and damage.”19
Plaintiff acknowledged in its complaint that the estimate of the
damage for each member could not be ascertained without “adequate
discovery and assessment.”20

Similarly, the claims of defamation

would have to be proven through evidence from each member regarding
what was said about that individual and by what method it was

19

Doc. 1, Pl.’s Compl. pp. 9-10.

20

Id.

7

published.

Moreover, the members’ defamation claims are only

peripherally related to NIDOA’s claims of trademark infringement
and false advertising.

As the participation of all four of the

members would be necessary, NIDOA is not in the best position to
prosecute its members’ cases.
This is a situation of individual monetary damages sought for
individualized harm from alleged defamation. The defamation claims
brought on behalf of NIDOA members should be barred for want of
Plaintiff’s standing to sue.
Defendants also raise two arguments based on Rules 8(a),
8(d)(1), and 12(b)(6).

The first is that, under Texas rules of

procedure, a defendant must “file a compulsory counterclaim when
the facts giving rise to [the] defendant’s claim stem from the same
transaction.”21 Defendants contend that Plaintiff’s failure to file
a mandatory counterclaim in the pending state lawsuit “is the
equivalent of failure to properly plead” and the failure “to state
a claim upon which relief can be granted.”22

Therefore, according

to Defendants, filing this action in federal court rather than as
a compulsory counterclaim in state court provides grounds for
dismissal of this action.

Defendants further contend that this

lawsuit was filed in retaliation against Defendants’ filing the
state lawsuit.

21

Doc. 18, Defs.’ Mot. to Dismiss p. 3.

22

Id. pp. 3-4.

8

Defendants fail to support this argument with any persuasive,
much less binding, case law.

In fact, enforcement of state

pleading rules is a job for the state court.

Texas’ rules of

procedure do not apply to cases in this court, particularly cases
over which the court is exercising federal-question jurisdiction.
Rule 13, which Defendants cite as in accord with the Texas rule on
compulsory counterclaims, does apply to this case but does not aid
Defendants’ cause.

As applied to the case pending here, Rule 13

addresses any claims that Defendants have against Plaintiff, not to
Plaintiff’s original claims.

Defendants’ state action is excepted

from Rule 13 as the claims therein are the subject of another
pending action.

See Fed. R. Civ. P. 13(a)(2).

Defendants’ compulsory-counterclaim argument fails as a basis
for dismissal.
Defendants’ second argument under the pleading rules is that
Plaintiff failed to “demonstrate” how it was harmed and that
Plaintiff’s alleged damages are speculative.23

This is a frivolous

argument.
Plaintiff’s complaint meets with all pleading standards.

It

includes sufficient facts to put Defendants on notice of the claims
alleged and the factual basis for those claims.

With particular

reference to damages, Plaintiff was required only to provide a
demand for the relief sought; it was not required to demonstrate

23

Id. p. 4.

9

how it was harmed.

Plaintiff alleged that Defendants benefitted

from the use of its trademarks, that Plaintiff’s reputation and
goodwill suffered from Defendants’ actions, that Plaintiff’s annual
meeting possibly lost sponsors and attendees, and that Defendants
converted NIDOA property.

Plaintiff sought an injunction against

infringement, $100,000 per mark that was infringed, and treble
damages for willful infringement.
Plaintiff’s complaint contains no pleading deficiency that
warrants dismissal.
IV.

Conclusion

Based on the foregoing, the court GRANTS Defendants’ Motion to
Dismiss as to the defamation claims against NIDOA’s members and
DENIES it in all other respects. Defendants’ request for sanctions
is denied.
SIGNED in Houston, Texas, this 10th day of October, 2017.

______________________________
U.S. MAGISTRATE JUDGE

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