Browne v. Zaslow

103 F. Supp. 3d 666, 2015 U.S. Dist. LEXIS 58522, 2015 WL 2069370
CourtDistrict Court, E.D. Pennsylvania
DecidedMay 5, 2015
DocketCivil Action No. 14-4711
StatusPublished
Cited by8 cases

This text of 103 F. Supp. 3d 666 (Browne v. Zaslow) is published on Counsel Stack Legal Research, covering District Court, E.D. Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Browne v. Zaslow, 103 F. Supp. 3d 666, 2015 U.S. Dist. LEXIS 58522, 2015 WL 2069370 (E.D. Pa. 2015).

Opinion

MEMORANDUM

SURRICK, District Judge.

Presently before the Court is Defendant Valori L. Zaslow’s Motion to Dismiss Plaintiffs’ Complaint (ECF No. 4), and Defendant Shopify, Inc.’s Motion to Dismiss Plaintiffs’ Complaint (ECF No. 34). For the following reasons, Zaslow’s and Shopify’s Motions will be granted in part.

I. BACKGROUND

This action involves a business dispute between individuals in an internet-based retail venture. Plaintiffs’ Complaint asserts claims for infringement under the Copyright Act, 17 U.S.C. § 101 et seq., as well as a number of state law claims. Defendants move to dismiss the action on substantive legal and jurisdictional grounds.

A. Factual Background

Defendant Valori Zaslow (“Zaslow”) owned and operated ReEvent, LLC, a retail business engaged in the sale of goods and services related to events and parties. (Compl. ¶¶ 20, 23, ECF No. 1.) Plaintiffs Allegra Saens Coleman (“Coleman”) and her mother Dolores Rita Browne (“D.Browne”) discussed with Zaslow the possibility of forming an internet-based business, whose website would be a “marketplace for the sale, rental, consignment and marketing of event related goods and services.” (Id. ¶ 21.) On August 12, 2013, they entered into an Operating Agreement to form ReEvent Enterprises, LLC (“REE”). (Operating Agreement, Compl. Ex., ECF No. 1 at 119-23.)1 D. Browne, Coleman, and Zaslow were the sole members of REE. (Id., ECF No. 1 at 120.) Since certain parts of her ReEvent, LLC [668]*668business were to merge with REE, Zaslow was given a 60% ownership stake in REE. (Compl. ¶¶23, 25.) D. Browne and Coleman were each given a 20% ownership stake in REE, respectively. (Id. ¶ 23.) The Operating Agreement provided that any “real and personal property purchased by [REE] with [REE] funds shall be owned by [REE] for the exclusive use of [REE].” (Operating Agreement, ECF No. 1 at 122.)

Under the agreement “[t]he purposes and nature of [REE], to be conducted and promoted, is to establish .and maintain a website” for the retail business. (Id., ECF No. 1 at 122.) While the parties divided responsibilities for the start-up of REE, D. Browne and Coleman had the primary responsibility of developing this website. (Compl. ¶ 26.) To do this, D. Browne and Coleman retained the services of their son and brother, Plaintiff Jonathan O’Neill Browne (“J. Browne”), a computer programmer with 30 years of experience. (Id.) He was to “write the code and software for the site based on the substantive content created and provided by [D. Browne] and [Coleman].” (Id.) J. Browne represents that, at the time he began work on the website, he “understood” that REE “would own and maintain the website.” (J. Browne Deck ¶ 5, Compl. Ex., ECF No. 1 at 82.) D. Browne agrees with this representation (D. Browne Deck ¶3, Compl. Ex., ECF No. 1 at 100), and Coleman does not dispute this representation. (Coleman Deck, Compl. Ex., ECF No. 1 at 125.)

The start-up of REE, and development of its website, also required certain costs. The Operating Agreement lists two specific start-up costs: a computer, as payment to J. Browne for his services, and the monthly costs of hosting the website with Defendant Shopify, Inc., a third-party website host. (Operating Agreement, ECF No. 1 at 122.) J. Browne understood and agreed that the computer was to be the sole compensation for his services. (Compl. ¶ 27; see also June 11, 2014 Ltr., Compl. Ex., ECF No. 1-1 at 27.) To cover these start-up costs, D. Browne, Coleman, and Zaslow collectively borrowed a little over $4,000. (Coleman Deck ¶ 13, ECF No. 1-1 at 1; see also June 11, 2014 Ltr., ECF No. 1-1 at 27.) Consistent with the agreed-upon fee-arrangement, J. Browne was provided with a new computer by the REE parties. The REE parties also jointly contributed funds to open and maintain the Shopify account. (Compl. ¶ 34.)

The REE Operating Agreement required the website to be completed within three months of J. Browne receiving the computer. (Operating Agreement, ECF No. 1 at 122.) Beginning his work for the website, J. Browne opened an account with Shopify to serve as the third-party internet host. (Compl. ¶ 28.) D. Browne held the administrative access and control to the Shopify account. (Id. ¶ 4; J. Browne Deck 111, ECF No. 1 at 83-84.) D. Browne and Coleman “designed the website and created the substantive content for the website.” (Compl. ¶ 31.) At then-direction, J. Browne translated D. Browne’s and Coleman’s “artistic, design and substantive content” into code. (Id.) J. Browne stored this code on the Shopify servers. (Id.) The major work for the design and creation of the website was performed by D. Browne and Coleman, with Zaslow offering assistance to a far lesser extent. (Id. ¶ 32.) This work-load arrangement was in accordance with the parties’ Operating Agreement. (Id. ¶ 33.) It is unclear from the pleadings when the REE website was finalized, if ever.

As things progressed, the Parties’ REE relationship soured for reasons that are not entirely clear. Allegations arose that duties imposed by the Operating Agreement were not being fulfilled. (Id. ¶ 35.) Efforts to rescind the Operating Agree[669]*669ment and restructure the ownership arrangement of REE were made. (Id. at ¶¶ 36-37, 41; see also June 11, 2014 Ltr., ECF No. 1-1 at 26 (“At this juncture ... Coleman and [D.] Browne will not work in an LLC with Ms. Zaslow in which Ms. Zaslow has a 60% interest. Period. End of story. End of discussion.”).) Following efforts to restructure their business arrangement, Zaslow attempted to have Sho-pify terminate the REE account. (Compl. ¶ 38.) Shopify contacted D. Browne regarding this request. (Id. ¶ 39.) In response, D. Browne caused Shopify to deny Zaslow access to the REE account. (Id. ¶40.) In the weeks that followed, D. Browne and Coleman, on the one hand, and Zaslow, on the other, contacted Shopify asserting ownership rights to the REE account. (Id. ¶¶ 43-44.) So as not to intervene in the Parties’ dispute, Shopify informed the Parties that it would deny access to the REE account to all concerned until the Parties resolved their differences. (Id. ¶ 45.) This was done in accordance with the agreed-upon terms of Shopify’s user agreement. (Id. ¶¶ 55-56.)

B. Procedural Background

Following unsuccessful attempts at resolving their disputes, this litigation ensued. Plaintiffs filed a Complaint in this Court on August 12, 2014 making numerous claims against Zaslow and Shopify. Plaintiffs assert federal claims under the Copyright Act (Compl. Counts I and II), and they also assert the following state-law causes of action: breach of contract (Count III), rescission of the Operating Agreement (Count IV), breach of the covenant of good faith and fair dealing (Counts V and VI), “quantum meruit and equitable distribution” (Count VII), breach of fiduciary duty (Counts VIII and IX), negligence (Counts X and XI), gross negligence (Counts XII and XIII), “intentional interference with existing contractual relations” (Count XIV), “intentional interference with a prospective contractual relations [sic]” (Count XV), and “declaration that all or some of the damage disclaimer provisions in the Shopify terms of service are not enforceable” (Count XVI).

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Cite This Page — Counsel Stack

Bluebook (online)
103 F. Supp. 3d 666, 2015 U.S. Dist. LEXIS 58522, 2015 WL 2069370, Counsel Stack Legal Research, https://law.counselstack.com/opinion/browne-v-zaslow-paed-2015.