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Olivarius v. Mermel

United States District Court, S.D. New York

April 1, 2018



          JED S. RAKOFF, U.S.D.J.

         This case is the unfortunate devolution of a dispute between the McAllister Olivarius law firm and its former client Mark Myers Mermel regarding legal fees. In its single-count Complaint, plaintiff McAllister Olivarius alleges that defendant Mermel registered the domain name in order to divert potential clients and others seeking information about the firm and, having done so, to induce plaintiff to reduce the amount it was seeking from him in unpaid legal fees by threatening to publish allegedly damaging documents about plaintiff on the website. Defendant thereby, in plaintiff's view, violated the Anticybersquatting Consumer Protection Act. Before the Court is defendant's motion to dismiss for lack of jurisdiction under Federal Rule of Civil Procedure 12(b)(1) and for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). ECF No. 8.


         The pertinent allegations of the Complaint are as follows: Plaintiff is a general partnership that operates as a law firm both in the United Kingdom and the United States. Complaint ("Compl.") at p.1 ¶ 1, ECF No. 1. Dr. Ann Olivarius, together with Dr. Jef McAllister, founded McAllister Olivarius in 1996 as a general practice law firm. See Id. at p.2 ¶ 1. The firm specializes in cases involving gender discrimination and sexual harassment in employment and educational settings. Id.

         Since its founding, plaintiff has regularly, continuously, and systematically used the name "McAllister Olivarius" in connection with the marketing and promotion of its legal services throughout the United States and abroad. See Id. at p.4 ¶ 6. Among other things, McAllister Olivarius promotes itself through articles about its cases published in media outlets and online via its website and social media presence. Id. The firm's cases also have generated articles in multiple publications, including the New York Times, the Los Angeles Times, Huffington Post, and the Chronicle of Higher Education. Id. Plaintiff's website,, has attracted more than 78, 000 visitors worldwide since January 1, 2014. Over 800, 000 people have viewed information distributed by Olivarius via Twitter in October and November 2017. Id. Defendant Mark Myers Mermel is a real estate developer and a former candidate for Lieutenant Governor of New York. Id. at p.2 ¶ 2. Mermel has earned postsecondary degrees from the University of Vermont, Columbia University, and the Divinity School at Yale University. Id. at p.2 ¶ 2. Mermel retained plaintiff as counsel on or about May 15, 2012 in connection with a dispute with Yale. Id. at p.5 ¶ 8. The terms of plaintiff's representation in connection with this dispute were memorialized in a written engagement letter, which was signed by Mermel on May 15, 2012 (the "Engagement Letter"). Id. at p.5 ¶ 9; see also Id. at Ex. A. The Engagement Letter contains a provision that "[a]ny dispute or legal issue arising from these terms of business or the engagement letter will be determined by the laws of the State of Connecticut, without reference to the principles of conflicts of law, and considered exclusively by Connecticut and U.S. courts." Id. at Ex. A, Terms of Business ¶ 10.

         Between May 2012 and August 2014, plaintiff sent eight invoices to Mermel, each setting forth the fees owed for its legal representation of Mermel and detailing the time spent and work performed. Id. at p.6 ¶ 12. Defendant refused, and continues to refuse, to pay plaintiff as required by the terms of the Engagement Letter. Id. at p.6 ¶ 11. Accordingly, on June 20, 2016, plaintiff filed a civil action against defendant for breach of contract and quantum meruit in the Superior Court for New Haven County, Connecticut. Id. at p.6 ¶ 13.

         At some point, Mermel registered the domain name Id. at p.6 ¶¶ 14-15. The website bore the title "McAllister Olivarius TRUTH" in large letters on every page. Id. at Ex. B. It had a home page, as well as pages named "Practice Areas, " "Attorneys", and "Contact, " Id. The home page displayed a picture of balance scale and the text "HI, MR JEF!" Id. The "Practice Areas" page was blank. Id. The "Attorneys" page listed two lawyers with no connection to McAllister Olivarius. See Id.; see also Id. at p.6 ¶ 16. This page also displayed the following text: "When you experience an injury, everything can change - we know that at Wilson & Doyle. With more than a century of combined experience litigating on our clients' behalf, you can focus on recovering, instead of finding yourself overwhelmed and worried about your court case." Id. at Ex. B. The Contact page included a form for visitors to send a message. Id. at p.6 ¶ 16.

         On July 1, 2016, in response to one of plaintiff's written demands for payment, Mermel threatened to populate the website with select documents that, Mermel claimed, "would cast Plaintiff and its principals in a negative light with 'other potential clients' and “cripple if not close' its business." Id. at p.7 ¶ 17. Mermel then offered to forego this plan if "both parties would simply 'walk away' from the unpaid balance, or, alternatively, plaintiff [substantially] reduced its balance." Id. at p.7 ¶ 18.

         On June 27, 2017, McAllister Olivarius sought leave to amend its original complaint in New Haven County Superior Court to add an anticybersquatting claim. Id. at p.7 ¶ 19. Mermel subsequently removed the website from the internet. Id. at p.7 ¶ 20. On July 24, 2017, plaintiff sought leave to file a second amended complaint, adding an intentional spoliation of evidence claim. Id. at p.7 ¶ 21. Mermel opposed. Id. at p.7 ¶ 22. The New Haven County Superior Court denied plaintiff's request on September 25, 2017, ruling that plaintiff's new claims were insufficiently related to its debt collection claims to warrant joinder in that action. Id. at p.7 ¶ 22. Plaintiff brought the instant action on December 20, 2017. See ECF No. 1.


         Defendant, pro se, now moves to dismiss plaintiff's complaint for lack of subject matter jurisdiction and failure to state a claim. See ECF No. 8. When, as here, a party proceeds pro se, a court must liberally construe the party's briefs, "reading such submissionsto raise the strongest arguments they suggest.'" Bertin v. United States, 478 F.3d 489, 491 (2d Cir. 2007) (quoting Burgos v. Hopkins, 14 F.3d 787, 790 (2d Cir. 1994)). "The policy of liberally construing pro se submissions is driven by the understanding that [i]mplicit in the right to self-representation is an obligation on the part of the court to make reasonable allowances to protect pro se litigants from inadvertent forfeiture of important rights because of their lack of legal training.'" Abbas v. Dixon, 480 F.3d 636, 639 (2d Cir. 2007). Although one suspects that these principles were formulated for the benefit of persons less educated than Mr. Mermel, they nevertheless fully apply here.

         I. Subject Matter Jurisdiction

         A motion to dismiss for lack of subject matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1) can be granted "when the court lacks the statutory or constitutional power to adjudicate the case." Nowak v. Ironworkers Local 6 Pension Fund, 81 F.3d 1182, 1187 (2d Cir. 1996). In reviewing a 12(b)(1) motion, the Court must ""accept as true all factual allegations in the complaint and draw all reasonable inferences in the Plaintiff's favor." See Merritt v. Shuttle, Inc., 245 F.3d 182, 186 (2d Cir. 2001). Defendant's arguments for dismissing under Rule 12(b)(1), even generously construed, are entirely without merit. Mermel first argues that this action is procedurally improper because McAllister Olivarius is the plaintiff and only defendants are entitled to removal under 28 U.S.C. §§ 1441. See 28 U.S.C. § 1441(a) ("[A]ny civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or defendants, to the district court of the United States for the district and division embracing the place where such action is pending."). However, this case does not involve removal. Granted, plaintiff sought to bring this claim in state court, but its request for leave to amend its complaint to include this cybersquatting claim was denied by the Connecticut state court. See Compl. at p.7 ¶ 22. Plaintiff thereafter initiated the instant action in this Court.

         Next, Mermel seems to argue that this case does not present a federal question because the "original complaint" - that is, the Connecticut complaint - alleged only breach of contract and quantum meruit. See Memorandum of Law in Support of Defendant Mark Myers Mermel Motion to Dismiss the Complaint ("Def. Mem.") at 17, ECF No. 9. This argument, like the previous one, misconstrues the relationship between this action and the Connecticut action. Although there may be a factual nexus between the two lawsuits, they are procedurally distinct. The cause of action that plaintiff has pled before this Court is based solely on a federal statute, the AntiCybersquatting Consumer Protection Act, 15 U.S.C. § 1125(d). The case therefore presents a federal question. See 28 U.S.C. § 1331 ("The district courts shall have original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States.").

         Mermel's final argument relating to jurisdiction depends on a choice of law provision in the Engagement Letter stipulating that "[a]ny dispute or legal issue arising from these terms of business or the engagement letter will be determined by the laws of the State of Connecticut, without reference to the principles of conflicts of laws of the State of Connecticut." Compl. at Ex. A. As an initial matter, plaintiff's anticybersquatting claim does not "aris[e]" from the terms of the parties' attorney-client relationship or the Engagement Letter. Therefore, the Engagement Letter's choice of law provision does not cover this dispute. Moreover, even if the clause were applicable here, it would govern only which state's law this Court must apply and therefore would not bar this Court's exercise of jurisdiction. See Executive Telecard, Ltd. v. Engelman, 1996 WL 191967, at *3 (S.D.N.Y. Apr. 19, 1996).

         II. Failure to State a Claim

         Mermel's motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) presents a closer question. To survive a motion to dismiss for failure to state a claim under Rule 12(b)(6), "a complaint must contain sufficient factual matter, accepted as true, toxstate a claim to relief that is plausible on its face.'" Ashcroft v. Igbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Mere conclusory statements in a complaint and "formulaic recitation[s] of the elements of a cause of action" are not sufficient. Twombly, 550 U.S. at 555.

         In considering a Rule 12(b)(6) motion, while the court generally looks to "the allegations on the face of the complaint, " "the court may permissibly consider . . . [d]ocuments that are attached to the complaint or incorporated in it by reference, " which "are deemed part of the pleading." Roth v. Jennings, 489 F.3d 499, 509 (2d Cir. 2007) .

         The Anticybersquatting Consumer Protection Act ("ACPA"), enacted in 1999, is intended "to protect consumers and American businesses, to promote the growth of online commerce, and to provide clarity in the law for trademark owners by prohibiting the bad-faith and abusive registration of distinctive marks as Internet domain names with the intent to profit from the goodwill associated with such marks - a practice commonly referred to as 'cybersquatting.'" S. Rep. No. 106-140, at 4; see also Sporty's Farm L.L.C. v. Sportsman's Market, Inc., 202 F.3d 489, 493 (2d Cir. 2000) ("Cybersquatting involves the registration of domain names of well-known trademarks by non-trademark holders who then try to sell the names back to the trademark owners."). The ACPA provides:

A person shall be liable in a civil action by the owner of a mark, including a personal name which is protected as a mark under this section, if, without regard to the goods or services of the parties, that person-
(i) has a bad faith intent to profit from that mark, including a personal name which is protected as a mark under this section; and (ii) registers, traffics in, or uses a domain name that-
(I) in the case of a mark that is distinctive at the time of registration of the domain name, is identical or ...

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