ADT LLC v. Vivint Smart Home, Inc.

CourtDistrict Court, S.D. Florida
DecidedSeptember 30, 2021
Docket1:20-cv-23391
StatusUnknown

This text of ADT LLC v. Vivint Smart Home, Inc. (ADT LLC v. Vivint Smart Home, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
ADT LLC v. Vivint Smart Home, Inc., (S.D. Fla. 2021).

Opinion

UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF FLORIDA

Case No. 20-23391-Civ-COOKE/GOODMAN

ADT LLC, et al.,

Plaintiffs,

vs.

VIVANT SMART HOME, INC., et al.,

Defendants. ____________________________________/ ORDER DENYING MOTION TO DISMISS THIS MATTER is before the Court on the Motion to Dismiss filed by Defendants Vivint Smart Home, Inc. f/k/a Mosaic Acquisition Corp. and Legacy Vivint Smart Home, Inc. f/k/a Vivint Smart Home, Inc. (ECF No. 24) (the “Motion”), filed October 27, 2020. Plaintiffs ADT, LLC and The ADT Security Corporation (“Plaintiffs”) filed their response in opposition to the Motion on November 10, 2020. ECF No. 28. Defendants Vivint Smart Home, Inc. f/k/a Mosaic Acquisition Corp. and Legacy Vivint Smart Home, Inc. f/k/a Vivint Smart Home, Inc. (“Defendants”) filed their reply in support of the Motion on November 17, 2020. ECF No. 29. Having reviewed the Motion, the briefing related thereto, the record, and the relevant legal authorities, the Court finds, for the reasons discussed below, that the Motion should be denied. Background Plaintiffs filed their initial complaint in this action on August 14, 2020. ECF No. 1. Then, on October 13, 2020, Plaintiffs filed a First Amended Complaint which is the operative pleading in this case. ECF No. 22. In sum, the crux of Plaintiffs’ allegations are as follows: This case is about Vivint’s false and misleading sales practices on the doorsteps and in the homes of hundreds—if not thousands—of ADT customers across the country. Through well-rehearsed sales tactics, Vivint’s sales representatives have misled scores of ADT customers into believing, among other things: (1) that the Vivint agent is there to simply “update” or “upgrade” the ADT customer’s equipment, when in reality he or she is switching out the ADT system for Vivint; (2) that ADT has been bought out or is going out of business and that Vivint is taking over ADT accounts; and (3) that Vivint is a subcontractor, installer or is otherwise affiliated with or acting on behalf of ADT. These affiliation misrepresentations allow Vivint to freeride on the goodwill of ADT, damage ADT’s name, and lead ADT’s customers to do business with Vivint under false pretenses, typically resulting in the ADT customer becoming bound into a multi-year contract with Vivint valued in the thousands of dollars that is impossible for the customer to extricate him or herself from once the customer has finally become aware of Vivint’s deception. These practices violate Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), and the related common law of unfair competition. ADT seeks damages to remedy its loss of numerous customers (some known, some unknown) and the disruption of thousands of others since December 20, 2017; ADT’s injuries to its goodwill and reputation; ADT’s lost royalties from Vivint’s unauthorized use of the ADT brand; Vivint’s profits from its ill-gotten gains, ADT’s attorneys’ fees; and punitive damages to punish and deter Vivint from continuing to engage in its intentional conduct.

ECF No 22, First Am. Compl. at ¶ 1. Plaintiffs’ First Amended Complaint asserts the following causes of action: 1) Unfair competition in violation of the Lanham Act, 15 U.S.C. § 1125(a)(1)(A); 2) Common law unfair competition; 3) Trade slander/commercial disparagement; and 4) Tortious interference with advantageous business relationships. Legal Standard Federal Rule of Civil Procedure 8(a) requires that a complaint “contain. . . a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). While this standard “does not require ‘detailed factual allegations,’ . . . it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). The standard requires the complaint to “give the defendant fair notice of what the plaintiff’s claim is and the grounds upon which it rests.” Swierkiewicz v. Sorema N.A., 543 U.S. 506, 512 (2002) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). To provide the “grounds” for “entitle[ment] to relief,” the complaint must contain “more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (citing Papasan v. Allain, 478 U.S. 265, 286 (1986)). “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.’” Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. When considering a motion to dismiss, the court must accept the allegations in the complaint as true and construe them in the light most favorable to the plaintiff. Duty Free Ams., Inc. v. Estee Lauder Cos., 797 F. 3d 1248, 1262 (11th Cir. 2015) (citing Murphy v. F.D.I.C., 208 F.3d 959, 962 (11th Cir. 2000)). However, this tenet is inapplicable to legal conclusions. Iqbal, 556 U.S. at 678. Analysis Defendants request that the Court dismiss, for failure to state a claim, Plaintiff’s claims for trade slander/commercial disparagement (Count III) and tortious interference with advantageous business relationships (Count IV). I. Plaintiffs Stated A Claim for Trade Slander/Commercial Disparagement Defendants argue that Plaintiffs’ claim for trade slander/commercial disparagement must be dismissed for failure to plead special damages with particularity. ECF No. 24 at 4-5. The Court disagrees. This Court has recognized that “[i]n a disparagement action the plaintiff must allege and prove the following elements: (1) [a] falsehood (2) has been published, or communicated to a third person (3) when the defendant-publisher knows or reasonably should know that it will likely result in inducing others not to deal with the plaintiff and (4) in fact, the falsehood does play a material and substantial part in inducing others not to deal with the plaintiff[,] and (5) special damages are proximately caused as a result of the published falsehood.” ADT LLC v. Vivint, Inc., No. 17-CV-80432, 2017 WL 5640725, at *6 (S.D. Fla. Aug. 3, 2017) (quoting Bothmann v. Harrington, 458 So. 2d 1163, 1168 (Fla. 3d DCA 1984)). This Court has also recognized that “[i]f an item of special damage is claimed, it must be specifically stated. . . . However, Rule 9(g) [of the Federal Rules of Civil Procedure] requires no more than a specific statement that allows a defendant to prepare a responsive pleading and begin its defense.” ThermoLife Int'l LLC v. Vital Pharms. Inc., No. 19-CV-61380, 2020 WL 409594, at *2 (S.D. Fla. Jan. 24, 2020) (citing Brennan v.

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Related

Conley v. Gibson
355 U.S. 41 (Supreme Court, 1957)
Papasan v. Allain
478 U.S. 265 (Supreme Court, 1986)
Bell Atlantic Corp. v. Twombly
550 U.S. 544 (Supreme Court, 2007)
Ashcroft v. Iqbal
556 U.S. 662 (Supreme Court, 2009)
Tamiami Trail Tours, Inc. v. Cotton
463 So. 2d 1126 (Supreme Court of Florida, 1985)
Landry v. Hornstein
462 So. 2d 844 (District Court of Appeal of Florida, 1985)
Safeco Title Ins. Co. v. Reynolds
452 So. 2d 45 (District Court of Appeal of Florida, 1984)
Arcade Steam Laundry v. Bass
159 So. 2d 915 (District Court of Appeal of Florida, 1964)
Ethan Allen, Inc. v. Georgetown Manor
647 So. 2d 812 (Supreme Court of Florida, 1994)
Brennan v. City of Minneola, Fla.
723 F. Supp. 1442 (M.D. Florida, 1989)
Linafelt v. Bev, Inc.
662 So. 2d 986 (District Court of Appeal of Florida, 1995)
Procacci v. Zacco
402 So. 2d 425 (District Court of Appeal of Florida, 1981)
Salit v. Ruden, McClosky, Smith, Schuster
742 So. 2d 381 (District Court of Appeal of Florida, 1999)
Bothmann v. Harrington
458 So. 2d 1163 (District Court of Appeal of Florida, 1984)
Leavitt v. Cole
291 F. Supp. 2d 1338 (M.D. Florida, 2003)
Sentry Data Sys., Inc. v. CVS Health
361 F. Supp. 3d 1279 (S.D. Florida, 2018)

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ADT LLC v. Vivint Smart Home, Inc., Counsel Stack Legal Research, https://law.counselstack.com/opinion/adt-llc-v-vivint-smart-home-inc-flsd-2021.