Phillips v. Cox

632 N.E.2d 668, 261 Ill. App. 3d 78, 198 Ill. Dec. 338, 1994 Ill. App. LEXIS 536
CourtAppellate Court of Illinois
DecidedApril 13, 1994
Docket5-93-0128
StatusPublished
Cited by10 cases

This text of 632 N.E.2d 668 (Phillips v. Cox) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Phillips v. Cox, 632 N.E.2d 668, 261 Ill. App. 3d 78, 198 Ill. Dec. 338, 1994 Ill. App. LEXIS 536 (Ill. Ct. App. 1994).

Opinion

JUSTICE WELCH

delivered the opinion of the court:

On July 26, 1983, David R. Cox (defendant) sold to Jackie H. Phillips and Debra S. Phillips (plaintiffs) his sign-making business, which included both real and personal property and the nonexclusive right to use the name "David Cox Signs.” The contract entered into between the parties did not contain any noncompetition clause. Sometime in April of 1989, defendant opened a new sign-making business next door to the plaintiffs. Defendant named his business: "David R. Cox d/b/a Sign Design and Construction.” Defendant also listed his new business in the local telephone book.

On February 21, 1992, plaintiffs filed their initial complaint in the circuit court of Jefferson County seeking, inter alia, injunctive relief. On March 12, 1992, the defendant filed his answer. On March 25, 1992, defendant filed a motion seeking summary judgment or, in the alternative, dismissal. On June 9, 1992, the trial court dismissed plaintiffs’ complaint for failing to state a cause of action. On June 29, 1992, plaintiffs filed an amended complaint seeking, inter alia, injunctive relief based upon the Uniform Deceptive Trade Practices Act (Act) (Ill. Rev. Stat. 1991, ch. 121½, pars. 312(1), (2), (12), 313 (now 815 ILCS 510/2(1), (2), (12), 3 (West 1992)).) In relevant part, section 2 of the Act provides:

"A person engages in a deceptive trade practice when, in the course of his business, vocation or occupation, he:
(1) passes off goods or services as those of another;
(2) causes likelihood of confusion or of misunderstanding as to the source, sponsorship, approval or certification of goods or services; [or]
(12) engages in any other conduct which similarly creates a likelihood of confusion or of misunderstanding.
In order to prevail in an action under this Act, a plaintiff need not prove competition between the parties or actual confusion or misunderstanding.” Ill. Rev. Stat. 1991, ch. 121½, pars. 312(1), (2), (12) (now 815 ILCS 510/2(1), (2), (12) (West 1992)).

In pertinent part, plaintiffs’ amended complaint alleged:

"1. Plaintiffs are the joint owners of a certain business known as 'David Cox Signs’ ***.
2. Defendant *** is the owner of a business known as 'David R. Cox, d/b/a Sign Design and Construction’, located *** immediately next door to Plaintiffs ***.
7. Defendant, in addition to naming his business 'David R. Cox, d/b/a Sign Design and Construction’, took out a business telephone listing identifying his business as 'David R. Cox’. Further, Defendant prepared and published advertisements to the general public soliciting sign business using the name 'David R. Cox’ in connection with said business advertisements. Defendant is in violation of the Uniform Deceptive Trade Practices Act, Ill. Rev. Stats., ch[J 121½, [par.] 312, subpart (1), (2), and (12), in that: Defendant physically located his business in close proximity to Plaintiffs’ business, used a name substantially similar to the name of Plaintiffs’ business in connection with his business and conducted a business offering services and goods similar to that of Plaintiff’s [sic] business.
10. *** Defendant has diverted Plaintiffs’ customers, thereby depriving Plaintiffs of sales and revenue which they would otherwise have had. Plaintiffs’ revenue has declined by the sum of $15,233.00 for the calendar year 1990, and by the sum of $16,733.00 for the calendar year 1991.
11. Unless prevented, the Defendant will continue to appropriate the business goodwill of Plaintiffs and divert Plaintiffs’ customers by continuing to engage in acts constituting deceptive trade practices. Accordingly, Plaintiffs will suffer irreparable injury for which they have no adequate remedy at law.”

On July 8, 1992, defendant filed a motion to dismiss for failure to state a cause of action. On November 20,1992, the trial court entered an order dismissing plaintiffs’ amended complaint. On December 4, 1992, plaintiffs filed a motion to reconsider. On December 11, 1992, defendant filed a motion for sanctions and a response to plaintiffs’ motion to reconsider. On February 2, 1993, the trial court denied both motions. Plaintiffs now appeal raising the following issue: whether plaintiffs’ amended complaint seeking injunctive relief states a cause of action under the Act. We hold that it does and hereby reverse the trial court.

The question before this court is whether plaintiff has stated a cause of action sufficient to survive a motion to dismiss for failure to state a cause of action. (Ill. Rev. Stat. 1991, ch. 110, par. 2 — 615 (now 735 ILCS 5/2 — 615 (West 1992)).) On appeal, this court reviews only the legal sufficiency of the complaint by determining whether the essential elements of the cause of action were alleged. (Bank of Northern Illinois v. Nugent (1991), 223 Ill. App. 3d 1, 9, 584 N.E.2d 948, 953.) A trial court’s decision to grant a motion to dismiss for failure to state a cause of action "should be affirmed on appeal only where no set of facts can be proved under pleadings which set forth a cause of action entitling the plaintiff to relief.” Nugent, 223 Ill. App. 3d at 9, 584 N.E.2d at 953.

At the outset, we want to make it clear that we are basing this decision on the broad language of subsection 12 of section 2 of the Act. We start from the premise advanced in Unique Concepts, Inc. v. Manuel (N.D. Ill. 1987), 669 F. Supp. 185, 191, aff’d (Fed. Cir. 1991), 937 F.2d 622 (unpublished order), that "[a]ny conduct in a business which creates a likelihood of consumer confusion or misunderstanding is potentially actionable [under subsection 12].”

The purpose of the Act is to prohibit unfair competition (Chabraja v. Avis Rent A Car System, Inc. (1989), 192 Ill. App. 3d 1074, 1079, 549 N.E.2d 872, 876), and "[i]t is primarily directed towards acts which unreasonably interfere with another’s conduct of his business.” (Popp v. Cash Station, Inc. (1992), 244 Ill. App. 3d 87, 98, 613 N.E.2d 1150, 1156.) By enacting the Act, the "legislature *** added another act to the growing list of statutes designed to prohibit acts commonly described as unfair competition.” (Ill. Ann. Stat., ch. 121½, par. 311 et seq., Prefatory Illinois Notes, at 238 (Smith-Hurd Supp. 1992).) Specifically:

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Bluebook (online)
632 N.E.2d 668, 261 Ill. App. 3d 78, 198 Ill. Dec. 338, 1994 Ill. App. LEXIS 536, Counsel Stack Legal Research, https://law.counselstack.com/opinion/phillips-v-cox-illappct-1994.