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CLARK CONSULTING, INC. v. FINANCIAL SOLUTIONS PARTNERS LLC

November 17, 2005.

CLARK CONSULTING, INC., a Delaware Corporation, Plaintiff and Counter-Defendant,
v.
FINANCIAL SOLUTIONS PARTNERS, LLC, a Connecticut Limited Liability Company, and JERRY REEN, JR., an individual, Defendants and Counter-Plaintiffs.



The opinion of the court was delivered by: SHIRA SCHEINDLIN, District Judge

OPINION AND ORDER

I. INTRODUCTION

  Clark Consulting, Inc. ("Clark") is suing Financial Solutions Partners LLC ("FSP") and Jerry Reen, Jr. (collectively "FSP defendants") for compensatory and punitive damages resulting from their alleged false representations and unfair competition and for an injunction barring defendants from engaging in such conduct in the future.*fn1 The FSP defendants have now asserted the following counterclaims against Clark: (1) violation of section 43(a) of the Lanham Act ("Counterclaim I"); (2) violation of section 349 of the New York General Business Law ("GBL") ("Counterclaim II"); (3) unfair competition by disparagement ("Counterclaim III"); and (4) slander ("Counterclaim IV").*fn2 Clark moves to dismiss all Counterclaims pursuant to Rule 12(b)(6) for failure to state a claim upon which relief can be granted. For the following reasons, Clark's motion is denied.

  II. BACKGROUND

  The following facts, drawn from the Counterclaim, are assumed true for purposes of this motion. FSP was founded in 2003 by Jerry Reen, James Corbin, and George Fehlhaber in order to market and sell separate account Bank Owned Life Insurance ("BOLI") products to banks through private placement.*fn3 With BOLI products, "banks purchase life insurance policies on the lives of [their] executives."*fn4 BOLI products are generally marketed in two forms, known as "general account" and "separate account" BOLI.*fn5 General account BOLI products are BOLI products that are backed by the general credit of the underlying insurer.*fn6 Separate account BOLI products are "[BOLI] products in which the issuing insurance company holds segregated portfolios of securities managed by an independent asset manager."*fn7 Clark markets and sells both types of BOLI products.*fn8

  Clark was founded more than thirty-five years ago and dominates the BOLI industry with about seventy percent or more of the BOLI market share in the United States.*fn9 FSP only recently entered the industry.*fn10 The separate account BOLI products sold by FSP purportedly provide higher returns and offer fully disclosed costs that are often lower than typical general account BOLI products, including Clark's.*fn11 The FSP defendants allege that Clark misled Clark's customers by failing to disclose various facts relevant to buyers, including its method for determining returns as well as its arrangements and relationships with insurance carriers.*fn12 Clark also allegedly disparaged the separate account BOLI products FSP offers, disparaged FSP's and Reen's business practices, and represented to FSP's customers that FSP's marketing materials are deceptive and misleading.*fn13

  III. LEGAL STANDARD

  A. Rule 12(b)(6)

  A motion to dismiss pursuant to Rule 12(b)(6) should be granted only if "`it appears beyond doubt that the plaintiff can prove no set of facts in support of [its] claim which would entitle [it] to relief.'"*fn14 At the motion to dismiss stage, the issue "`is not whether a plaintiff is likely to prevail ultimately, but whether the claimant is entitled to offer evidence to support the claims. Indeed it may appear on the face of the pleading that a recovery is very remote and unlikely but that is not the test.'"*fn15

  The task of the court in ruling on a Rule 12(b)(6) motion is "`merely to assess the legal feasibility of the complaint, not to assay the weight of the evidence which might be offered in support thereof.'"*fn16 When deciding a motion to dismiss, courts must accept all factual allegations in the complaint as true, and draw all reasonable inferences in plaintiff's favor.*fn17 Although the plaintiff's allegations are taken as true, the claim may still fail as a matter of law if it appears beyond doubt that the plaintiff can prove no set of facts in support of its claim which would entitle it to relief, or if the claim is not legally feasible.*fn18 Accordingly, a claim can only be dismissed if "`no relief could be granted under any set of facts that could be proved consistent with the allegations.'"*fn19

  B. Rule 8(a)

  Rule 8(a) of the Federal Rules of Civil Procedure requires that the plaintiff must provide "a short and plain statement of the claim showing that the pleader is entitled to relief." Rule 8(a) does not require "a plaintiff to plead the legal theory, facts, or elements underlying his claim."*fn20 "To comply with Rule 8, plaintiffs need not provide anything more than sufficient notice to permit defendant to file an answer."*fn21 The only requirement is that a complaint allege the "bare minimum facts necessary to put the defendant on notice of the claim so that [it] can file an answer."*fn22 Fair notice is "`that which will enable the adverse party to answer and prepare for trial, allow the application of res judicata, and identify the nature of the case so that it may be assigned the proper form of trial.'"*fn23 Thus a complaint "[may] not be dismissed on the ground that it is conclusory or fails to allege facts."*fn24 This notice pleading standard "relies on liberal discovery rules and summary judgment motions to define disputed facts and issues and to dispose of unmeritorious claims."*fn25

  C. Noerr-Pennington Doctrine

  "The Noerr-Pennington doctrine was first established in the context of concerted petitions for anti-competitive legislation."*fn26 The Supreme Court has extended the doctrine to apply to concerted actions before courts and administrative agencies.*fn27 The Noerr-Pennington doctrine protects litigation or lobbying by private individuals seeking to influence governmental anticompetitive action under the First Amendment.*fn28 Such activities are immunized from antitrust liability.*fn29 ...


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