United States District Court, D. New Jersey
MEMORANDUM AND ORDER
G. SHERIDAN, U.S.D.J.
matter comes before the Court on Defendants Zuru LTD and
Zuru, Inc.'s (collectively, “Zuru”) Motion to
Dismiss Plaintiff Ontel Products Corp.'s Complaint for
failure to state a claim pursuant to Fed.R.Civ.P. 12(b)(6)
(ECF No. 8). Plaintiff alleges Defendants have engaged in
unfair competition, in violation of the Lanham Act, 15 U.S.C.
§ 1125(a), and presents common law claims of unfair
competition, tortious interference with a prospective
business advantage, and unjust enrichment. In support of
Defendants' contention that Plaintiff has failed to state
a claim, Defendants rely exclusively on one defense. That is,
Defendants argue they are immune from liability by virtue of
the Noerr-Pennington immunity doctrine. Because Defendants'
motion is predicated solely on the Noerr-Pennington immunity,
the discussion herein is limited to Defendants'
Noerr-Pennington immunity argument.
22, 2017, Plaintiff initiated this suit by filing a Complaint
in this Court against Defendants. (ECF No. 1). Plaintiff is a
New Jersey-based company that markets and develops retail
products commonly found in large retail stores, such as Toys
‘R' Us, Walmart, Home Depot, and Bed Bath and
Beyond. (Comp. at ¶ 10). Specifically, Plaintiff markets
and distributes a toy product called “Build Bonanza,
” which is “an adhesive backed building block
tape” used to connect LEGO® style
blocks. (Id. at ¶ 15).
Zuru LTD is a Chinese company with its principal place of
business in Guangzhou, China. (Id. at ¶ 3).
Zuru, Inc. is a Chinese-based corporation with its principal
place of business in Forked River, New Jersey. (Id.
at ¶ 4). According to the Complaint, Defendants intend
to sell and manufacture a product strikingly similar to Build
Bonanza, called “Nimuno Loops, ” which is also an
“adhesive backed building block tape.”
(Id. at ¶ 17). Plaintiff alleges that Zuru has
made false allegations about Ontel to Ontel's retail
partners, in order to “Disrupt Ontel's business
operations and client relationships.” (Id. at
¶ 20). On May 17, 2017, Plaintiff claims Zuru met with
Walmart representatives and indicated that Zuru had served
Plaintiff with a cease and desist letter, which purportedly
threatened legal action against Plaintiff for alleged patent
infringement, and that Walmart should not carry
Plaintiff's product. (Id. at ¶ 22). Zuru
allegedly made similar statements that same day to one of
Plaintiff's international distributors. (Id. at
¶ 25). The following day, Plaintiff claims that Zuru
pressured Toys ‘R' Us into “back[ing]
away” from its commitment to place Plaintiff's
products in its Back to School catalog. (Id. at
¶¶ 21- 22).
claims it has never received a cease and desist letter.
(Id. at ¶ 23). Moreover, based on a search of
the U.S. Patent and Trademark Office records, Zuru has no
registered patents or any other patents “under which
they had rights related to . . . Ontel's Product.”
(Id. at ¶ 24). As such, Plaintiff alleges that
Zuru's statements to its retail partners have been
“made for the purpose of jeopardizing Ontel's
business relationships and supplying the products
themselves.” (Id. at ¶ 26).
brings four causes of action based on federal and state law.
Its first two causes of action allege unfair competition
under both federal, 15 U.S.C. § 1125(a), and a New
Jersey statute. It also alleges state tort claims under
theories of tortious interference with prospective economic
advantage and unjust enrichment. Defendants contend that all
of the Counts of Plaintiff's Complaint are barred by the
motion to dismiss for failure to state a claim pursuant to
Fed.R.Civ.P. 12(b)(6), the Court is required to accept as
true all allegations in the Complaint and all reasonable
inferences that can be drawn therefrom, and to view them in
the light most favorable to the non-moving party. See
Oshiver v. Levin, Fishbein, Sedran & Berman, 38 F.3d
1380, 1384 (3d Cir. 1994). “To survive a motion to
dismiss, a complaint must contain sufficient factual matter,
accepted as true, to ‘state a claim to relief that is
plausible on its face.'” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl.
Corp. v. Twombly, 550 U.S. 544 (2007)). While a court
will accept well-pleaded allegations as true for the purposes
of the motion, it will not accept bald assertions,
unsupported conclusions, unwarranted inferences, or sweeping
legal conclusions cast in the form of factual allegations.
Iqbal, 556 U.S. at 678-79; see also Morse v.
Lower Merion Sch. Dist., 132 F.3d 902, 906 (3d Cir.
1997). A complaint should be dismissed only if the
well-pleaded alleged facts, taken as true, fail to state a
claim. See In re Warfarin Sodium Antitrust Litig.,
214 F.3d 395, 397-98 (3d Cir. 2000).
contend that all the claims alleged should be dismissed since
they are barred by the Noerr-Pennington doctrine. That is,
Defendants' “supposed misrepresentations in letters
and communications concern[ed] enforcement of [their]
intellectual property rights, ” entitle them to
Noerr-Pennington doctrine arises from anti-trust law, where
it allows competitors to exercise their right to petition
legislatures on a common basis. See Allied Tube &
Conduit Corp. v. Indian Head, 486 U.S. 492, 499-501
(1988). “The Noerr-Pennington doctrine . . .
protects citizens from being penalized for exercising their
first amendment right to petition the
government.” Carpet Grp. Int'l v. Oriental Rug
Imps. Ass'n, 256 F.Supp.2d 249, 261 (D.N.J. 2003).
“Rooted in the First Amendment and fears about
the threat of liability chilling political speech, ”
the doctrine immunizes private parties, “who attempted
to influence government action - even where the petitioning
had anticompetitive effects, ” from federal antitrust
laws. A.D. Bedell Wholesale Co. v. Philip Morris
Inc., 263 F.3d 239, 250 (3d Cir. 2001). Although the
doctrine originated in the antitrust context, it has been
extended on a limited basis “to offer protection to
citizens' petitioning activities in contexts outside the
anti-trust area as well.” We, Inc. v. City of
Philadelphia, 174 F.3d 322, 326-27 (3d Cir. 1999);
see also BE & K Const. Co. v. N.L.R.B., 536 U.S.
516 (2002) (applying the doctrine to the National Labor
Relations Act); Brownsville Golden Age Nursing Home, Inc.
v. Wells, 839 F.2d 155, 160 (3d Cir. 1988) (doctrine
applied to tort liability for actions based on petitions to
the government to shut down a nursing home that was in
violation of various regulations).
in order to receive Noerr-Pennington immunity, Defendants
must have petitioned the government for redress. See A.D.
Bedell, 263 F.3d at 250. For example, A.D.
Bedell noted that, “[u]nder the Noerr-Pennington
doctrine, ‘[a] party who petitions the government for
redress generally is immune from antitrust
liability.'” Id. (citation omitted);
see also Cardtoons, L.C. v. Major League Baseball Players
Ass'n, 208 F.3d 885, 893 (10th Cir. 2000) (holding
that “because there was no petition of the government
in the present case, the issue of immunity collapses into the
issue of state law liability.”). Moreover,
Noerr-Pennington immunity has been extended to some limited
non-traditional petitioning, such as “efforts to
influence governmental action incidental to litigation such
as prelitigation threat letters.” A.D. Bedell,
263 F.3d at 252.
A.D. Bedell, Defendants contend their efforts to
protect their “extensive intellectual property
rights” entitles them to Noerr-Pennington immunity. In
A.D. Bedell, the Third Circuit was tasked with
determining whether defendant tobacco companies were shielded
from potential antitrust liability, since they collectively
entered settlement agreements with sovereign states. 263 F.3d
at 254. Seeing no reason to differentiate between settlement
agreements, and other acts associated with litigation between
the government and private actors, the court ...