{"cached_at":"2026-11-07T11:44:46.997854+00:00","cl_docket_id":"4769275","docket":{"resource_uri":"https://www.courtlistener.com/api/rest/v4/dockets/4769275/","id":4769275,"court":"https://www.courtlistener.com/api/rest/v4/courts/miwd/","court_id":"miwd","original_court_info":null,"idb_data":{"resource_uri":"https://www.courtlistener.com/api/rest/v4/fjc-integrated-database/21874162/","date_created":"2018-11-21T04:35:31.119689-08:00","date_modified":"2022-01-27T16:02:55.970398-08:00","dataset_source":9,"office":"1","docket_number":"0700460","origin":1,"date_filed":"2007-05-09","jurisdiction":3,"nature_of_suit":190,"title":"","section":"1331","subsection":"","diversity_of_residence":null,"class_action":null,"monetary_demand":75,"county_of_residence":26145,"arbitration_at_filing":"","arbitration_at_termination":"","multidistrict_litigation_docket_number":"","plaintiff":"POLAR MOLECULAR CORPORATION","defendant":"AMWAY CORPORATION","date_transfer":null,"transfer_office":"","transfer_docket_number":"","transfer_origin":"","date_terminated":"2008-12-04","termination_class_action_status":null,"procedural_progress":4,"disposition":6,"nature_of_judgement":0,"amount_received":0,"judgment":2,"pro_se":0,"year_of_tape":2009,"nature_of_offense":"","version":null,"circuit":"https://www.courtlistener.com/api/rest/v4/courts/ca6/","district":"https://www.courtlistener.com/api/rest/v4/courts/miwd/"},"clusters":[],"audio_files":[],"assigned_to":"https://www.courtlistener.com/api/rest/v4/people/241/","referred_to":null,"bankruptcy_information":null,"absolute_url":"/docket/4769275/polar-molecular-corporation-v-amway-corporation/","date_created":"2017-04-19T01:44:52.355933-07:00","date_modified":"2024-11-12T15:09:51.932881-08:00","source":9,"appeal_from_str":"","assigned_to_str":"Robert Holmes Bell","referred_to_str":"","panel_str":"","date_last_index":"2020-12-27T12:34:34.586900-08:00","date_cert_granted":null,"date_cert_denied":null,"date_argued":null,"date_reargued":null,"date_reargument_denied":null,"date_filed":"2007-05-09","date_terminated":"2008-12-04","date_last_filing":"2011-02-24","case_name_short":"","case_name":"Polar Molecular Corporation v. Amway Corporation","case_name_full":"","slug":"polar-molecular-corporation-v-amway-corporation","docket_number":"1:07-cv-00460","docket_number_core":"0700460","docket_number_raw":"1:07-cv-00460","docket_number_source":0,"federal_dn_office_code":"","federal_dn_case_type":"","federal_dn_judge_initials_assigned":"","federal_dn_judge_initials_referred":"","federal_defendant_number":null,"pacer_case_id":"52829","cause":"28:1331 Fed. Question: Breach of Contract","nature_of_suit":"Contract: Other","jury_demand":"","jurisdiction_type":"Federal question","appellate_fee_status":"","appellate_case_type_information":"","mdl_status":"","filepath_ia":"","filepath_ia_json":"https://archive.org/download/gov.uscourts.miwd.52829/gov.uscourts.miwd.52829.docket.json","ia_upload_failure_count":null,"ia_needs_upload":true,"ia_date_first_change":"2018-09-30T00:00:00-07:00","date_blocked":null,"blocked":false,"appeal_from":null,"parent_docket":null,"tags":[],"panel":[]},"parties":[],"entries":[{"resource_uri":"https://www.courtlistener.com/api/rest/v4/docket-entries/16543075/","id":16543075,"docket":"https://www.courtlistener.com/api/rest/v4/dockets/4769275/","recap_documents":[{"resource_uri":"https://www.courtlistener.com/api/rest/v4/recap-documents/17387980/","id":17387980,"tags":[],"absolute_url":"/docket/4769275/128/polar-molecular-corporation-v-amway-corporation/","date_created":"2017-04-19T08:59:42.328472-07:00","date_modified":"2024-11-12T15:09:51.982717-08:00","sha1":"c4a705713cf907cf14c3074c26812bf5ecd2c82b","page_count":13,"file_size":97691,"filepath_local":"recap/gov.uscourts.miwd.52829/gov.uscourts.miwd.52829.128.0.pdf","filepath_ia":"https://archive.org/download/gov.uscourts.miwd.52829/gov.uscourts.miwd.52829.128.0.pdf","ia_upload_failure_count":null,"thumbnail":null,"thumbnail_status":0,"plain_text":" Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1549 Page 1 of 13\n\n\n\n UNITED STATES DISTRICT COURT\n FOR THE WESTERN DISTRICT OF MICHIGAN\n SOUTHERN DIVISION\n\n\n\n\nPOLAR MOLECULAR CORPORATION,\n\n Plaintiff,\n File No. 1:07-CV-460\nv.\n HON. ROBERT HOLMES BELL\nAMWAY CORPORATION, et al.,\n\n Defendants.\n /\n\n OPINION\n\n This Court previously dismissed or granted summary judgment for the Amway\n\nDefendants1 and the DNS Defendants2 on portions of Plaintiff Polar Molecular Corporation\u2019s\n\ncomplaint alleging trademark infringement, breach of contract, misappropriation of trade\n\nsecrets, and conversion. (Dkt. Nos. 52, 53, 83, 84.) This matter is now before the Court on\n\nthe Driving Force Defendants\u2019 3 motion for summary judgment on the basis of collateral\n\nestoppel on all issues previously decided against Plaintiff on the dispositive motions filed by\n\nthe other Defendants (Dkt. No. 91), and on motions for summary judgment filed by all of the\n\n 1\n The \u201cAmway Defendants\u201d are Defendants Amway Corporation, Quixtar Inc., Alticor\nInc., and Access Business Group L.L.C. In this opinion the Court has not distinguished\nbetween the various Amway Defendants, instead referring to one or all of them as \u201cAmway.\u201d\n 2\n The \u201cDNS Defendants\u201d are Defendants J.B.R. Sullivan Company, D.N.S. Marketing\nCompany, Bill Newton, Jeff Selzer, and Robert Disberger.\n 3\n The \u201cDriving Force Defendants\u201d are Defendants Driving Force Technologies, LLC,\nTrans Tech One, LLC and Isabelle\u2019s Lighting, Inc.\n\f Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1550 Page 2 of 13\n\n\n\nDefendants on the remaining portions of Count I, alleging violations of the Lanham Act, and\n\nCount V, alleging conspiracy. (Dkt. Nos. 86, 93.) For the reasons stated herein, the motions\n\nfor summary judgment will be granted.\n\n I.\n\n The background facts are not in dispute. Plaintiff Polar Molecular Corporation, which\n\nis owned by Mark Nelson, developed a fuel additive known as \u201cDurAlt.\u201d Plaintiff licensed\n\nthe Amway Defendants to manufacture and sell DurAlt under the name \u201cFreedom Fuel.\u201d\n\nDefendants Robert Disberger, Bill Newton and Jeff Selzer are top distributors for the Amway\n\nDefendants. In 2005 Plaintiff declined to authorize the DNS Defendants to manufacture\n\nFreedom Fuel. The Amway Defendants subsequently stopped manufacturing and selling\n\nFreedom Fuel. The DNS Defendants formed the Driving Force Defendants in order to\n\ndevelop and manufacture a competitive fuel additive called ProFuel. ProFuel was offered\n\nfor sale on an Amway-approved website for a brief period of time.\n\n The only counts of the complaint that have not yet been adjudicated are Counts I and\n\nV. Count I alleges a violation of the Lanham Act and Count V alleges civil conspiracy. In\n\na previous opinion the Court declined to rule on \u201cthe sufficiency of Plaintiff\u2019s Lanham Act\n\nclaim to the extent that it is based upon false statements that have caused confusion as to\n\nDefendants\u2019 association with Plaintiff or as to Plaintiff\u2019s sponsorship or approval of\n\nDefendants\u2019 goods or commercial activities.\u201d (Dkt. No. 52, 11/14/07 Op. at 9.) The Court\n\nalso declined to dismiss Plaintiff\u2019s conspiracy claim to the extent that it was based upon\n\n\n\n 2\n\f Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1551 Page 3 of 13\n\n\n\npalming-off or unfair competition. (Id. at 15-16.) In the joint status report filed on May 8,\n\n2008, Plaintiff represented that the remaining portions of its Lanham Act and conspiracy\n\nclaims in Counts I and V \u201cinvolve an allegation that Defendants have falsely told and have\n\nconspired amongst each other to falsely tell potential customers and actual customers that\n\nthere is a licensing agreement with Plaintiff for the manufacture and sale of ProFuel.\u201d (Dkt.\n\nNo. 88, Jt. Status Report 2.)\n\n II.\n\n Under Rule 56(c) of the Federal Rules of Civil Procedure, summary judgment is\n\nproper if there is no genuine issue as to any material fact and the moving party is entitled to\n\njudgment as a matter of law. In evaluating a motion for summary judgment the Court must\n\nlook beyond the pleadings and assess the proof to determine whether there is a genuine need\n\nfor trial. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). If\n\nDefendants carry their burden of showing there is an absence of evidence to support a claim\n\nthen Plaintiff must demonstrate by affidavits, depositions, answers to interrogatories, and/or\n\nadmissions on file, that there is a genuine issue of material fact for trial. Celotex Corp. v.\n\nCatrett, 477 U.S. 317, 324-25 (1986).\n\n In considering a motion for summary judgment, the court must construe the evidence\n\nand draw all reasonable inferences in favor of the nonmoving party. Minges Creek, L.L.C.\n\nv. Royal Ins. Co. of Am., 442 F.3d 953, 955-56 (6th Cir. 2006) (citing Matsushita, 475 U.S.\n\nat 587). Nevertheless, the mere existence of a scintilla of evidence in support of Plaintiff's\n\n\n\n 3\n\f Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1552 Page 4 of 13\n\n\n\nposition is not sufficient to create a genuine issue of material fact. Anderson v. Liberty\n\nLobby, Inc., 477 U.S. 242, 252 (1986). The proper inquiry is whether the evidence is such\n\nthat a reasonable jury could return a verdict for Plaintiff. Id.; see generally Street v. J.C.\n\nBradford & Co., 886 F.2d 1472, 1476-80 (6th Cir. 1989).\n\n III.\n\n The Driving Force Defendants seek summary judgment on the basis of collateral\n\nestoppel on all issues previously decided against Plaintiff on the dispositive motions filed by\n\nthe other Defendants. (Dkt. No. 91.) Specifically, the Driving Force Defendants seek\n\njudgment on the following claims: Count I alleging violation of Section 43(a) of the Lanham\n\nAct based upon the use of the \u201cFreedom\u201d trademark; Count III alleging misappropriation of\n\ntrade secrets; Count IV alleging conversion; and Count V alleging conspiracy based on trade\n\nsecret misappropriation.\n\n The Sixth Circuit has established a four-part test for determining when collateral\n\nestoppel bars relitigation of an issue:\n\n (1) the precise issue raised in the present case must have been raised and\n actually litigated in the prior proceeding; (2) determination of the issue must\n have been necessary to the outcome of the prior proceeding; (3) the prior\n proceeding must have resulted in a final judgment on the merits; and (4) the\n party against whom estoppel is sought must have had a full and fair\n opportunity to litigate the issue in the prior proceeding.\n\nKosinski v. Comm\u2019r, 541 F.3d 671, 675 (6th Cir. 2008) (quoting United States v. Cinemark\n\nUSA, Inc., 348 F.3d 569, 583 (6th Cir. 2003)).\n\n\n\n\n 4\n\f Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1553 Page 5 of 13\n\n\n\n Although Plaintiff disagrees with the Court\u2019s prior rulings, Plaintiff acknowledges that\n\nthe Court has ruled on each of the issues listed above and that collateral estoppel appears to\n\nbar further litigation of these issues. (Dkt. No. 103, Pl.\u2019s Resp. to Mot. for Summ. J.).\n\n Upon review the court is satisfied that collateral estoppel bars relitigation of these\n\nissues. Accordingly, the Driving Force Defendants\u2019 motion for summary judgment on the\n\nissues previously decided against Plaintiff will be granted.\n\n IV.\n\n All of the Defendants have moved for summary judgment on the remaining portions\n\nof Plaintiff\u2019s Lanham Act and conspiracy claims in Counts I and V on the basis that there is\n\ninsufficient evidence to sustain the claims against them. As noted above, these remaining\n\nclaims are based on Plaintiff\u2019s allegation that Defendants have falsely told and have\n\nconspired amongst each other to falsely tell potential customers and actual customers that\n\nthere is a licensing agreement with Plaintiff for the manufacture and sale of ProFuel.\n\n In order to bring a false advertising claim under the Lanham Act a plaintiff must be\n\nable to establish the following five elements:\n\n 1) the defendant has made false or misleading statements of fact concerning\n his own product or another\u2019s; 2) the statement actually deceives or tends to\n deceive a substantial portion of the intended audience; 3) the statement is\n material in that it will likely influence a deceived consumers\u2019 purchasing\n decisions; 4) the advertisements were introduced into interstate commerce; 5)\n there is some causal link between the challenged statements and harm to the\n plaintiff.\n\n\n\n\n 5\n\f Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1554 Page 6 of 13\n\n\nBalance Dynamics Corp. v. Schmitt Indus., Inc., 204 F.3d 683, 689 (6th Cir. 2000) (quoting\n\nAm. Council of Certified Podiatric Physicians and Surgeons v. Am. Bd. of Podiatric Surgery,\n\nInc., 185 F.3d 606, 613 (6th Cir.1999)).\n\n In their motions for summary judgment Defendants focus on the first element of the\n\nLanham Act claim. The Amway Defendants contend that there is no evidence that they had\n\nany involvement in any statements that were allegedly false or misleading or that allegedly\n\ncaused confusion as to Defendants\u2019 association with Plaintiff or as to Plaintiff\u2019s sponsorship\n\nor approval of Defendants\u2019 goods or commercial activities. The DNS and Driving Force\n\nDefendants contend that there is no evidence that they made any false assertions that ProFuel\n\nwas a licensed product of Polar Molecular or Mark Nelson.\n\n In response to Defendants\u2019 motions for summary judgment, Plaintiff relies on its\n\ncomplaint, the affidavit of Mark Nelson, the deposition of George Peintner, and the affidavit\n\nof Jennie Holtz. (Dkt. No. 102, Pl.\u2019s Resp.)\n\n Plaintiff\u2019s reliance on the allegations in its complaint is inappropriate. A summary\n\njudgment motion \u201crequires the nonmoving party to go beyond the pleadings.\u201d Celotex, 477\n\nU.S. at 324. \u201cWhen a motion for summary judgment is properly made and supported, an\n\nopposing party may not rely merely on allegations or denials in its own pleading; rather, its\n\nresponse must \u2013 by affidavits or as otherwise provided in this rule \u2013 set out specific facts\n\nshowing a genuine issue for trial.\u201d Fed. R. Civ. P. 56(e)(2). Accordingly, for purposes of\n\nthese summary judgment motions, the Court will not consider the allegations in Plaintiff\u2019s\n\ncomplaint.\n\n\n 6\n\f Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1555 Page 7 of 13\n\n\n\n Plaintiff also relies on the affidavit of its CEO, Mark Nelson. Nelson\u2019s affidavit\n\nincludes statements regarding information he was allegedly told by Amway distributors.\n\n(Dkt. No. 102, Pl.\u2019s Resp., Ex. 1, Nelson Aff. \u00b6 27.) Nelson states that he has \u201cbeen\n\ninformed by Quixtar distributors that Bill Newton, Jeff Selzer and Robert Disberger et. al.\n\nhad told them along with potential and actual customers, throughout the country, that they\n\nhad purchased the rights to Polar\u2019s technology from Alticor for the manufacture and sale of\n\n\u2018Freedom 2\u2019 (a/k/a ProFuel X-2) with the permission from myself and Polar.\u201d (Id.)\n\n Rule 56(e) requires that opposing affidavits be made on \u201cpersonal knowledge\u201d and\n\nto set forth facts that would be admissible in evidence, and to \u201cshow affirmatively that the\n\naffiant is competent to testify to the matters stated therein.\u201d F ED. R. C IV. P. 56(e). Nelson\u2019s\n\nstatements regarding what he was told by Amway distributors are hearsay. They are not\n\nbased on personal knowledge and they would not be admissible in evidence. \u201cA party\n\nopposing a motion for summary judgment cannot use hearsay or other inadmissible evidence\n\nto create a genuine issue of material fact.\u201d Sperle v. Michigan Dept. of Corrections 297 F.3d\n\n483, 495 (6th Cir. 2002) (citing Weberg v. Franks, 229 F.3d 514, 526 n.13 (6th Cir. 2000)\n\n(disregarding many of the plaintiff's allegations because they were based upon hearsay rather\n\nthan personal knowledge). Accordingly, the Court will not consider the statements in\n\nNelson\u2019s affidavit that are not based upon personal knowledge.\n\n The only other relevant evidence Plaintiff presents in opposition to Defendants\u2019\n\nmotions for summary judgment are the deposition of George Peintner, a diamond level\n\n\n\n 7\n\f Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1556 Page 8 of 13\n\n\n\nindependent business distributor with Amway, and the affidavit of Jennie Holtz, a downline\n\nindependent business owner (\u201cIBO\u201d). Peintner testified that after speaking with Defendant\n\nDisberger, he sent an email down-line to IBOs which contained the following information\n\nwith respect to ProFuel:\n\n Hello Gang. Great news. Those IBOs that enjoyed Freedom Fuel additive can\n find the product on the Quixtar website again. The name of the new product\n is ProFuel. ProFuel is twice as concentrated and a third to half the cost of\n Freedom. . . . ProFuel has an info web page that gives you all the info on how\n to order and questions about the product. . . . Go to www.profuelproducts.com\n . . . and enter freedom2 for both the user name and pass code. There you will\n find how to order the product on shop.com. Any questions about the product\n can be answered by emailing ProFuel at the following address:\n info@profuelproducts.com.\n\n(Pl.\u2019s Resp., Ex. 7, Peintner Dep. 23-25; Pl.\u2019s Resp., Ex. 8, Holtz Aff. \u00b6\u00b6 4-5.)\n\n Jennie Holtz received a copy of this email from her upline IBO. (Holtz Aff. \u00b6 4.)\n\nAfter going to the ProFuel website it appeared to Holtz that \u201cthe information pertaining to\n\nProFuel was identical to the information describing and promoting Freedom Fuel when it was\n\nincluded in the Quixtar product line.\u201d (Id. at \u00b6 6.)\n\n Peintner testified that he obtained the information for this email from Defendant\n\nDisberger, who asked for Peintner\u2019s help in promoting the product. (Peintner Dep. 25.)\n\nPeintner assumed that Disberger had obtained clearance to market the product on Amway\u2019s\n\nshop.com website, but later found out that the DNS Defendants had marketed ProFuel\n\nthrough Isabelle Lighting on Amway\u2019s shop.com website without Amway\u2019s knowledge. (Id.\n\nat 25-27.) Peintner testified that ProFuel was marketed on shop.com for only a short period\n\n\n\n 8\n\f Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1557 Page 9 of 13\n\n\nof time, and that as soon as it was brought to Amway\u2019s attention, Amway took corrective\n\nmeasures and ProFuel was removed from the website. (Id. at 19, 27.)\n\n Peintner did not believe that ProFuel was the same product as Freedom Fuel. (Id. at\n\n22.) According to Peintner, ProFuel was not marketed as Freedom Fuel, but as a replacement\n\nfor Freedom Fuel. (Id. at 29.) Peintner testified that the DNS Defendants led him to believe\n\nthat \u201cthey had acquired the patent on the product and so it was going to be very similar if not\n\nthe same.\u201d (Id. at 31.) Peintner\u2019s understanding was that \u201cthe ProFuel product was\n\nessentially the Freedom Fuel product with one difference and that was concentration. They\n\nfelt like they had a different product because the concentration levels were different.\u201d (Id..\n\nat 35-36.)\n\n Plaintiff contends that the evidence of record is sufficient to create an issue of fact as\n\nto whether Defendants took deceptive action to cause confusion as to the affiliation,\n\nconnection or association of ProFuel with Plaintiff and caused confusion as to the origin,\n\nsponsorship, or approval of ProFuel. The Court disagrees.\n\n Plaintiff has produced no evidence linking the Amway Defendants to any statements\n\nor activities connected with ProFuel. Although ProFuel was sold for a short period of time\n\non Amway\u2019s shop.com website, the evidence is unrefuted that the Amway Defendants did\n\nnot authorize the marketing of ProFuel on its website, and that they had ProFuel removed\n\nfrom the website as soon as they became aware of it. The evidence is also unrefuted that the\n\nAmway Defendants had nothing to do with the ProFuel testimonial on the ProFuel website.\n\n(Dkt. No. 87, Amway Defs.\u2019 Br., Ex. 3, Disberger Dep. 114.)\n\n\n 9\n\f Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1558 Page 10 of 13\n\n\n\n Plaintiff attempts to attribute the statements and actions of Amway distributors and\n\nIBOs to Amway under an express or implied agency theory. Contrary to Plaintiff\u2019s\n\nargument, there is no law or evidence to support Plaintiff\u2019s argument that Peintner,\n\nDisberger, Newton and Selzer are agents of the Amway Defendants and that their actions and\n\nstatements can be attributed to the Amway Defendants. Those cases that have considered the\n\nAmway Defendants\u2019 operations have unanimously held that Amway IBOs are not agents of\n\nAmway, and that Amway is not vicariously liable for their actions. See, e.g., Procter &\n\nGamble Co. v. Haugen, 317 F.3d 1121, 1127-28 (10th Cir. 2003) (holding that Amway had\n\nnot vested its distributors with actual, express, or implied authority, and noting that the\n\ndistributors act virtually autonomously in determining in what manner to sell Amway\n\nproducts); Lomax v. Henry, 119 A.D.2d 638, 639, 501 N.Y.S.2d 84, 85 (N.Y.A.D. 2\n\nDept.,1986) (finding no legal basis for finding that Amway distributors were functioning as\n\nagents rather than independent contractors of Amway). The Amway IBO Registration\n\nAgreement and the Amway Rules of Conduct specify that IBOs are independent contractors\n\nand that they are not employees, agents, or legal representatives of Amway. (Dkt. No. 104,\n\nAmway Defs.\u2019 Reply Br., Ex. 11, 12.)\n\n The only evidence Plaintiff has offered in support of its agency theory is Holtz\u2019s\n\nstatement that as a Quixtar IBO she \u201creceived updates, new and pertinent information and\n\nguidelines from Quixtar\u2019s corporate headquarters including information regarding upcoming\n\nQuixtar products through communications from our up-line, individuals authorized by\n\n\n\n 10\n\f Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1559 Page 11 of 13\n\n\n\nQuixtar to supervise IBOs within their organization including myself.\u201d (Holtz Aff. \u00b6 3.)\n\nThis evidence is wholly insufficient to create an issue of fact as to whether Peintner,\n\nDisberger, Newton, or Selzer was an agent of the Amway Defendants. Because Plaintiff has\n\npresented no evidence linking the Amway Defendants to any statements or activities\n\nconnected with ProFuel, the Amway Defendants are entitled to summary judgment on the\n\nremaining portions of Counts I and V.\n\n Plaintiff does not fare any better with its claims against the DNS and Driving Force\n\nDefendants. Although Plaintiff claims that these Defendants told others that they purchased\n\nthe rights to manufacture and sell ProFuel from the Amway Defendants with Plaintiff\u2019s\n\npermission, the only direct evidence Plaintiff has offered in support of this claim is the\n\naffidavit of Nelson. (Nelson Aff. \u00b6 27.) As noted above, Nelson\u2019s statement to this effect\n\nis not based on personal knowledge and is not competent evidence.\n\n The only other evidence Plaintiff has presented against the DNS and Driving Force\n\nDefendants is the Peintner email and the Peintner deposition testimony. The Peintner email\n\ndoes not mention Polar or Mark Nelson at all. Peintner understood that ProFuel was similar\n\nto Freedom Fuel, and that it was being marketed as a replacement for Freedom Fuel. His\n\nemail regarding a new product called ProFuel reflects this understanding. The email directs\n\ninquiries about the product to www.profuelproducts.com. The Court understands that the\n\nemail\u2019s references to \u201cfreedom2\u201d as the user name and pass code and to the ability to order\n\nthe product from shop.com could conceivably create some confusion as to ProFuel\u2019s\n\n\n\n 11\n\f Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1560 Page 12 of 13\n\n\n\nconnection with Amway. However, even if the email is evidence that the DNS and Driving\n\nForce Defendants improperly implied a connection between ProFuel and Amway, there is\n\nnothing in Peintner\u2019s email to suggest that those associated with ProFuel made any false or\n\nmisleading statements about any relationship between ProFuel and Plaintiff, or its president,\n\nMark Nelson.\n\n Plaintiff has presented only one other piece of evidence in support of its claim that\n\nDefendants made false statements regarding the relationship between ProFuel and Plaintiff.\n\nThis evidence is Peintner\u2019s testimony that the DNS Defendants said they had \u201cacquired the\n\npatent on the product and so it was going to be very similar if not the same.\u201d (Peintner Dep.\n\nat 31.). This testimony is ambiguous at best. It does not indicate what any of the DNS\n\nDefendants said, or what patent was allegedly acquired. Defendants Disberger, Newton and\n\nSelzer have all denied telling anyone that Plaintiff licensed, sponsored, or approved their to\n\nmanufacture or sale of ProFuel. (Dkt. No. 87, Amway Defs.\u2019 Br., Ex. 3-5, Disberger Dep.\n\n112-15, Newton Dep. 35-36, Selzer Dep. 57-59.) Peintner\u2019s testimony regarding the patent\n\nclaim can be understood to be consistent with the unrebutted evidence that the DNS and\n\nDriving Force Defendants developed ProFuel by reverse engineering Plaintiff\u2019s DurAlt\n\nformula based on a sample of DurAlt and the expired DurAlt patent. (Dkt. No. 83, 3/31/08\n\nOp. 11.) If Defendants were referring to the expired DurAlt patent, there is no misstatement.\n\nIf Defendants were referring to a patent for ProFuel, there is no misstatement. It is only if\n\nDefendants were referring to an unexpired DurAlt patent that this might be evidence of a\n\n\n\n 12\n\f Case 1:07-cv-00460-RHB ECF No. 128 filed 12/04/08 PageID.1561 Page 13 of 13\n\n\n\nmisstatement. However, given the ambiguous and isolated nature of this alleged comment,\n\nthe Court finds that this evidence is not sufficient to create an issue of fact for trial on\n\nPlaintiff\u2019s Lanham Act false advertising and conspiracy claims. Plaintiff has not presented\n\nsufficient probative evidence to permit a finding in Plaintiff\u2019s favor on more than mere\n\nspeculation, conjecture, or fantasy. See Lewis v. Philip Morris Inc., 355 F.3d 515, 533 (6th\n\nCir. 2004) (\u201cIn order to survive a motion for summary judgment, the non-moving party must\n\nbe able to show sufficient probative evidence [that] would permit a finding in [its] favor on\n\nmore than mere speculation, conjecture, or fantasy.\u201d (internal quotations omitted)).\n\n For the reasons stated above, Defendants\u2019 motions for summary judgment will be\n\ngranted. An order consistent with this opinion will be entered.\n\n\n\n\nDated: December 4, 2008 /s/ Robert Holmes Bell\n ROBERT HOLMES BELL\n UNITED STATES DISTRICT JUDGE\n\n\n\n\n 13\n\f","ocr_status":2,"date_upload":null,"document_number":"128","attachment_number":null,"pacer_doc_id":"09901852742","is_available":true,"is_free_on_pacer":true,"is_sealed":null,"document_type":1,"description":"","acms_document_guid":""}],"date_created":"2017-04-19T08:59:42.322208-07:00","date_modified":"2024-11-12T15:09:51.965966-08:00","date_filed":"2008-12-04","time_filed":null,"entry_number":128,"recap_sequence_number":"2008-12-04.001","pacer_sequence_number":525,"description":"OPINION ; signed by Judge Robert Holmes Bell (Judge Robert Holmes Bell, kcb)","tags":[]},{"resource_uri":"https://www.courtlistener.com/api/rest/v4/docket-entries/16469510/","id":16469510,"docket":"https://www.courtlistener.com/api/rest/v4/dockets/4769275/","recap_documents":[{"resource_uri":"https://www.courtlistener.com/api/rest/v4/recap-documents/17314286/","id":17314286,"tags":[],"absolute_url":"/docket/4769275/83/polar-molecular-corporation-v-amway-corporation/","date_created":"2017-04-19T04:28:50.658157-07:00","date_modified":"2024-11-12T13:43:21.419218-08:00","sha1":"f13fcc179b78dba85f96847f3430fa03f85ce56a","page_count":12,"file_size":91010,"filepath_local":"recap/gov.uscourts.miwd.52829/gov.uscourts.miwd.52829.83.0.pdf","filepath_ia":"https://archive.org/download/gov.uscourts.miwd.52829/gov.uscourts.miwd.52829.83.0.pdf","ia_upload_failure_count":null,"thumbnail":null,"thumbnail_status":0,"plain_text":" Case 1:07-cv-00460-RHB ECF No. 83 filed 03/31/08 PageID.821 Page 1 of 12\n\n\n\n UNITED STATES DISTRICT COURT\n FOR THE WESTERN DISTRICT OF MICHIGAN\n SOUTHERN DIVISION\n\n\n\n\nPOLAR MOLECULAR CORPORATION,\n\n Plaintiff,\n File No. 1:07-CV-460\nv.\n HON. ROBERT HOLMES BELL\nAMWAY CORPORATION, et al.,\n\n Defendants,\n\nand\n\nD.N.S. MARKETING COMPANY,\n\n Counter-Plaintiff,\n\nv.\n\nPOLAR MOLECULAR CORPORATION,\n\n Counter-Defendant.\n /\n\n OPINION\n\n In a six-count complaint filed in this action Plaintiff Polar Molecular Corporation has\n\nalleged violations of the Lanham Act, breach of contract, misappropriation of trade secrets,\n\nconversion, civil conspiracy, and a request for injunctive relief. The Amway Defendants1\n\n\n 1\n The Amway Defendants are Defendants Amway Corporation, Quixtar Inc.,\nAlticor Inc., and Access Business Group L.L.C.\n\n 1\n\f Case 1:07-cv-00460-RHB ECF No. 83 filed 03/31/08 PageID.822 Page 2 of 12\n\n\nand the DNS Defendants 2 filed dispositive motions. (Dkt. Nos. 37, 38.) By order dated\n\nNovember 14, 2007, this Court dismissed Count IV alleging conversion, dismissed portions\n\nof Counts I, II, III, and V, and permitted limited discovery and supplemental briefing\n\nconfined to the confidentiality and trade secret claims in Counts II and III. (Dkt. No. 53,\n\n11/14/2007 Order.) Plaintiff has now filed a supplemental response in opposition to\n\nDefendants\u2019 motion for summary judgment, (Dkt. No. 65), and the Amway Defendants have\n\nfiled a supplemental reply brief (Dkt. No. 73). The DNS Defendants have filed a\n\nconcurrence in the Amway Defendants\u2019 motion to dismiss and their supplemental reply.\n\n(Dkt. Nos. 40, 74.)\n\n I.\n\n Under Rule 56(c) of the Federal Rules of Civil Procedure, summary judgment is\n\nproper if there is no genuine issue as to any material fact and the moving party is entitled to\n\njudgment as a matter of law. In evaluating a motion for summary judgment the Court must\n\nlook beyond the pleadings and assess the proof to determine whether there is a genuine need\n\nfor trial. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). If\n\nDefendants carry their burden of showing there is an absence of evidence to support a claim\n\nthen Plaintiff must demonstrate by affidavits, depositions, answers to interrogatories, and\n\nadmissions on file, that there is a genuine issue of material fact for trial. Celotex Corp. v.\n\nCatrett, 477 U.S. 317, 324-25 (1986).\n\n\n\n\n 2\n The DNS Defendants are Defendants J.B.R. Sullivan Company, D.N.S.\nMarketing Company, Bill Newton, Jeff Selzer, and Robert Disberger.\n\n 2\n\f Case 1:07-cv-00460-RHB ECF No. 83 filed 03/31/08 PageID.823 Page 3 of 12\n\n\n\n In considering a motion for summary judgment, the court must construe the evidence\n\nand draw all reasonable inferences in favor of the nonmoving party. Minges Creek, L.L.C.\n\nv. Royal Ins. Co. of Am., 442 F.3d 953, 955-56 (6th Cir. 2006) (citing Matsushita, 475 U.S.\n\nat 587). Nevertheless, the mere existence of a scintilla of evidence in support of Plaintiff\u2019s\n\nposition is not sufficient to create a genuine issue of material fact. Anderson v. Liberty\n\nLobby, Inc., 477 U.S. 242, 252 (1986). The proper inquiry is whether the evidence is such\n\nthat a reasonable jury could return a verdict for Plaintiff. Id.; see generally, Street v. J.C.\n\nBradford & Co., 886 F.2d 1472, 1476-80 (6th Cir. 1989).\n\n II.\n\n Plaintiff alleges in Count II that the Amway Defendants breached the 1995 Licensing\n\nAgreement in 2006 by disclosing confidential information. Plaintiff alleges in Count III that\n\nthe Amway Defendants and the DNS Defendants misappropriated trade secrets. Both counts\n\nrelate to Plaintiff\u2019s claim that the Amway Defendants disclosed the confidential formulas\n\nfor Plaintiff\u2019s DurAlt products to the DNS Defendants, and that the DNS Defendants used\n\nthese confidential formulas in developing their ProFuel product.\n\n Defendants contend that they are entitled to summary judgment on Counts II and III\n\nbecause the uncontroverted facts show that the Amway Defendants did not provide any\n\nconfidential formula to any unauthorized third party. In support of this motion Defendants\n\npreviously provided declarations from Amway employees Michael Sullivan, Robert D.\n\nFaber, and Linda Emperor, from Defendants Newton, Disberger, and Selzer, and from\n\n\n\n 3\n\f Case 1:07-cv-00460-RHB ECF No. 83 filed 03/31/08 PageID.824 Page 4 of 12\n\n\n\nStephen Lehnardt, a managing member of Defendants Trans Tech One L.L.C. and Driving\n\nForce Technologies L.L.C. (Dkt. No. 38, Amway Defs.\u2019 Mot. to Dismiss, Ex. 2-8.) These\n\nseven affidavits uniformly state that there was no unauthorized disclosure of any of\n\nPlaintiff\u2019s confidential fuel additive formulas and that ProFuel was independently developed\n\nthrough reverse engineering based on an analysis of Amway\u2019s Freedom Fuel product and\n\nthe fuel additive technology disclosed in Plaintiff\u2019s expired U.S. Patent No. 4,753,661.\n\n In its original response to Defendants\u2019 motion for summary judgment Plaintiff\n\npresented evidence that it supplied the Amway Defendants with the formulas for more\n\nadvanced versions of DurAlt pursuant to the confidentiality provisions of the 1995 Licensing\n\nAgreement, (Pl.\u2019s Resp., Nelson Aff. \u00b6 12); that the chemical scan of ProFuel is nearly\n\nidentical to DurAlt Gasoline Fuel Conditioner, the formula for which was supplied to the\n\nAmway Defendants, (Compl. Ex. 15; Nelson Aff. \u00b6 24); that ProFuel has been advertised\n\nfor sale through Amway websites, (Pl. Ex. 6, 11); that the ProFuel testimonials are nearly\n\nidentical to those used in the marketing of Freedom Fuel (Nelson Aff. \u00b6 29); that the Amway\n\nDefendants generally require a lengthy product claims verification procedure, (Nelson Aff.\n\n\u00b6 22); and that the rapid introduction of ProFuel for sale through Amway-approved websites\n\nsuggests that Defendants relied on Plaintiff\u2019s confidential test data (Nelson Aff. \u00b6\u00b6 21-22).\n\n This Court determined that the evidence presented by Plaintiff was not sufficient to\n\ncontrovert the evidence produced by the Amway Defendants and was not sufficient to\n\nestablish the existence of a genuine issue of material fact for trial. (Dkt. No. 52, 11/14/07\n\n\n\n 4\n\f Case 1:07-cv-00460-RHB ECF No. 83 filed 03/31/08 PageID.825 Page 5 of 12\n\n\nOp. 25.) Now, having had an opportunity to conduct discovery on the issues of the\n\ndisclosure of confidential information and the misappropriation of trade secrets, Plaintiff has\n\nprovided additional evidence in opposition to Defendants\u2019 motion for summary judgment.\n\n Plaintiff essentially relies on two pieces of evidence in support of its contention that\n\nthe Amway Defendants disclosed Plaintiff\u2019s confidential DurAlt fuel additive formula to the\n\nDNS Defendants. The new evidence consists of Mike Herblet\u2019s November 8, 2005, email\n\nforwarding \u201cconfidential\u201d information to Defendant Disberger (Pl.\u2019s Supp. Resp., Ex. 4),\n\nand Stephen Lenhardt\u2019s April 16, 2006, handwritten note that \u201cQuixtar accidentally sent the\n\nrecipe to Bill [Newton]\u201d (Pl.\u2019s Supp. Resp., Ex. 2). Plaintiff also contends that the fact that\n\nthe individuals who developed ProFuel are not scientists, the fact that they did not form\n\nTrans Tech One, register ProFuel, or begin marketing ProFuel until after April 18, 2006, and\n\nthe fact that ProFuel is a copy of an advanced DurAlt formula that had been provided to the\n\nAmway Defendants, all support the conclusion that the Amway Defendants disclosed the\n\nconfidential formula, and that this disclosure served as the catalyst for the development of\n\nProFuel.\n\n In reply to Plaintiff\u2019s supplemental response, Defendants have come forward with\n\nevidence that the \u201cconfidential information\u201d referenced in the November 2005 email was not\n\nin fact confidential, and the April 2006 handwritten note simply referred back to the\n\nmislabeled email. According to Defendants, Plaintiff has still failed to present any evidence\n\nto support its claim in Count II for breach of contract based on disclosure of confidential\n\ninformation or its claim in Count III for misappropriation of trade secrets.\n\n\n 5\n\f Case 1:07-cv-00460-RHB ECF No. 83 filed 03/31/08 PageID.826 Page 6 of 12\n\n\n\n Upon review of the evidence the Court agrees with Defendants that Plaintiff has not\n\ncome forward with sufficient evidence of disclosure of confidential information or\n\nmisappropriation of trade secrets to withstand Defendants\u2019 motion for summary judgment.\n\nAlthough Plaintiff has identified some superficial ambiguities in the evidence, a review of\n\nthe evidence as a whole confirms that these ambiguities are readily explained and are not\n\nsufficient to create a genuine issue of fact for trial.\n\n Plaintiff\u2019s evidence regarding the November 8, 2005, email is as follows. On\n\nNovember 1, 2005, Debi Pilkington, an assistant to Polar\u2019s President Mike Nelson, emailed\n\nMichael Herblet, a member of Defendant Quixtar\u2019s Sales and Marketing department, \u201cCAS\n\nregistry forms for DurAlt and DuraFlo.\u201d (Pl.\u2019s Suppl. Resp., Ex. 4.) The attached CAS\n\nregistry forms disclosed a list of chemicals contained in DurAlt Fuel Conditioner and\n\nDuraFlo Winter Fuel Conditioner. Id. The email requested that Herblet \u201cconsider this\n\ninformation to be proprietary and confidential and not for distribution outside\n\nQuixtar/Alticor or any other Alticor subsidiary.\u201d Id. In addition, both of the CAS registry\n\nforms were marked \u201cPROPRIETARY AND CONFIDENTIAL INFORMATION OF\n\nPOLAR MOLECULAR CORPORATION not for redistribution outside Quixtar, Alticor,\n\nand its subsidiaries.\u201d Id. Despite this confidential designation, Mr. Herblet emailed the\n\ninformation to Mr. Disberger, an individual who was not part of Quixtar or Alticor. Id.\n\n Although Plaintiff identified the CAS registry forms as \u201cconfidential,\u201d that\n\ndesignation is not in itself sufficient to make them confidential. By its terms, the\n\n\n\n 6\n\f Case 1:07-cv-00460-RHB ECF No. 83 filed 03/31/08 PageID.827 Page 7 of 12\n\n\n\nconfidentiality obligations in Section 5 of the 1995 Licensing Agreement do not apply to\n\ninformation which \u201c(a) as shown by written records was known to recipient prior to\n\ndisclosure hereunder [or] (b) is now, or hereafter becomes, without fault of recipient, known\n\nto the general public.\u201d (Dkt. 48, Pl.\u2019s Resp. in Opp\u2019n to Mot. to Dismiss, Ex. 2 at 6-7.)\n\nSimilarly, Plaintiff\u2019s identification of the CAS registry forms as confidential and proprietary\n\nis not sufficient to make them trade secrets. Under Michigan law, to qualify as a trade\n\nsecret, information must derive independent economic value from \u201cnot being generally\n\nknown to, and not being readily ascertainable by\u201d other persons who can obtain economic\n\nvalue from its disclosure or use and it must be the subject of \u201cefforts that are reasonable\n\nunder the circumstances to maintain its secrecy.\u201d M.C.L. \u00a7 445.1902(d). \u201c\u2018To be a trade\n\nsecret, the information must, of necessity, be a Secret.\u2019\u201d Wysong Corp. v. M.I. Indus., 412\n\nF. Supp. 2d 612, 626 (E.D. Mich. 2005) (quoting Kubik, Inc. v. Hull, 56 Mich. App. 335,\n\n347, 224 N.W.2d 80 (1974)). \u201cTrade secrets do not \u2018encompass information which is\n\nreadily ascertainable, i.e., capable of being acquired by competitors or the general public\n\nwithout undue difficulty or hardship.\u2019\u201d Id. (quoting Kubik, Inc., 56 Mich. App. at 348).\n\n Defendants have presented unrebutted evidence that CAS registry forms are forms\n\nrequired by the Canadian government to regulate hazardous substances. CAS registry forms\n\nare similar to Material Safety Data Sheets (\u201cMSDS\u201d) that the United States government\n\nrequires be made available to persons potentially exposed during the manufacture, handling,\n\nand use of hazardous substances. (Dkt. No. 73, Def.\u2019s Suppl. Resp., Ex. 2, Davison Decl.\n\n\n\n 7\n\f Case 1:07-cv-00460-RHB ECF No. 83 filed 03/31/08 PageID.828 Page 8 of 12\n\n\n\n\u00b6 3.) Because fuel additives contain hazardous substances, the federal government requires\n\nthat MSDS forms be made available to persons potentially exposed during the manufacture,\n\nhandling, and use of fuel additives. Id. The information contained in an MSDS form is\n\nnecessarily public because its primary function is to notify members of the public of the\n\nhazards associated with making, transporting, selling and ultimately using hazardous\n\nsubstances. (Davison Decl. \u00b6 6.)\n\n The evidence is undisputed that prior to November 2005, Plaintiff provided MSDS\n\nforms for their DurAlt products to the Amway Defendants and others without a\n\nconfidentiality designation. (Defs.\u2019 Suppl. Reply, Herblet Decl. 4; Defs.\u2019 Suppl. Reply,\n\nDisberger Decl. \u00b6\u00b6 8-9.) For example, in June and July 2005, after Plaintiff had entered into\n\na Master Distribution Agreement with Defendant JBR Sullivan, Plaintiff sent Robert\n\nDisberger of JBR Sullivan MSDS forms for DurAlt Fuel Conditioner and for DuraFlo II\n\nWinter Fuel Conditioner. (Disberger Decl. \u00b6\u00b6 7-9, and Ex. B, C.) In October 2005 Plaintiff\n\nemailed Mr. Herblet MSDS forms for several of its fuel additives, including DuraFlo II\n\nWinter Fuel Conditioner. (Herblet Decl. \u00b6 4.) Neither the MSDS forms nor the transmittal\n\nemail were marked confidential. (Id.)\n\n The CAS registry forms that were attached to the November 2005 email contained\n\nthe same information that was contained in the \u201cHazardous Ingredients\u201d section of the\n\nMSDS forms for those products that had previously been sent to Herblet without any\n\nconfidentiality designation. Accordingly, Herblet assumed that Plaintiff\u2019s labeling of the\n\n\n\n 8\n\f Case 1:07-cv-00460-RHB ECF No. 83 filed 03/31/08 PageID.829 Page 9 of 12\n\n\n\nCAS registry forms as confidential was a mistake. (Id. at \u00b68.) Upon receiving the CAS\n\nregistry forms Herblet forwarded them to Amway\u2019s Canadian regulatory department for\n\nprocessing. (Id. at \u00b69.) On November 8, 2005, in response to Disberger\u2019s inquiry regarding\n\nAmway\u2019s efforts to complete the product approval process in Canada, Herblet forwarded\n\nthe CAS registry forms to Disberger. (Id. at \u00b6 10.)\n\n Because the contents of the CAS registry forms that were attached to the November\n\n2005 email are identical to the contents of MSDS forms that had previously been sent to\n\nHerblet and Disberger without any confidentiality designation, and because the regulatory\n\ninformation is by its nature a matter of public information, Plaintiff\u2019s contention that the\n\nAmway Defendants emailed confidential information or trade secrets to Defendant\n\nDisberger on November 8, 2005, is not supported by the evidence.\n\n That brings the Court to Plaintiff\u2019s second piece of evidence, Lenhardt\u2019s handwritten\n\nnote from his April 16, 2006, telephone conference with Newton. Lehnardt noted that\n\n\u201cQuixtar accidentally sent the recipe to Bill [Newton].\u201d (Pl.\u2019s Suppl. Resp., Ex. 2.)\n\nLehnardt does not know what recipe Newton was talking about. (Pl.\u2019s Suppl. Resp., Ex. 1,\n\nLehnardt Dep. 85.)\n\n Newton does not recall making such a statement to Lehnardt and states that he would\n\nnot have told Lehnardt that Amway sent him the recipe for a fuel additive because that never\n\nhappened. (Defs.\u2019 Suppl. Reply, Ex. 13, Newton Decl. \u00b6 11.) According to Newton,\n\nQuixtar never sent any recipes to Newton, so he would not have discussed that with\n\n\n\n 9\n\f Case 1:07-cv-00460-RHB ECF No. 83 filed 03/31/08 PageID.830 Page 10 of 12\n\n\n\nLehnardt. (Pl.\u2019s Suppl. Resp., Ex. 12, Newton Dep. 28.) Newton suggests that he might\n\nhave told Lehnardt what he had heard from Disberger, i.e., that Disberger had received\n\nconfidential information about a PMC fuel additive from Amway, but Disberger did not\n\nsend Newton the information and he did not give Newton any further details about what he\n\nhad received. (Newton Decl. \u00b6\u00b6 10-11; Newton Dep. 32.)\n\n Newton\u2019s suggestion regarding what he may have discussed with Lehnardt is\n\nconsistent with Disberger\u2019s testimony. Disberger testified that when received the CAS\n\nregistry forms with the \u201cconfidential\u201d designation they looked like formulas to him.\n\n(Disberger Decl. \u00b6 11; Pl.\u2019s Suppl. Resp., Ex. 3, Disberger Dep. 108.) In late 2005 or 2006\n\nDisberger recalls mentioning to Newton that Amway may have accidentally sent him\n\nconfidential information regarding Plaintiff\u2019s fuel additive products. (Disberger Decl. \u00b6 13;\n\nNewton Decl. \u00b6 10.) However, Disberger did not give Newton any details about the\n\ninformation he had received, nor did he send Newton any written materials concerning the\n\ninformation he had received. (Disberger Dep. 106-07; Disberger Decl. \u00b6 12.)\n\n It is undisputed that the \u201cconfidential information\u201d Disberger referred to in his\n\nconversation with Newton was the CAS registry forms. When the evidence is considered\n\nas a whole and when Lehnardt\u2019s handwritten note is reviewed in context, it is evident that\n\nit is nothing more than another reference to the disclosure of the non-confidential CAS\n\nregistry forms in the November 8, 2005 Herblet email.\n\n Neither does the timing of the development of ProFuel support an inference that\n\n\n\n 10\n\f Case 1:07-cv-00460-RHB ECF No. 83 filed 03/31/08 PageID.831 Page 11 of 12\n\n\n\nPlaintiff\u2019s formula was disclosed to the developers of ProFuel. The evidence is\n\nuncontroverted that when Amway announced its intention to discontinue production of\n\nFreedom Fuel, two separate groups of individuals began parallel but independent efforts to\n\nfind another fuel additive supplier. (Disberger Decl. \u00b6\u00b6 12, 14; Lehnardt Dep. 15-18.)\n\nBecause Disberger and Selzer had enjoyed success selling Amway\u2019s Freedom Fuel, they\n\ncontacted at least five companies in their efforts to find an alternative fuel additive supplier.\n\n(Disberger Decl. \u00b6 14.) At the same time, Stephen Lehnardt and his partner, Stuart Frizzell,\n\nwere working with David Frizzell, a chemical engineer, to reverse engineer the DurAlt\n\nformula by analyzing a sample of DurAlt with a gas chromatograph and comparing their\n\nfindings to the expired DurAlt patent. (Lehnardt Dep. 16-21, 37-42, 104-16.) Lehnardt and\n\nFrizzell\u2019s formula was substantially complete by mid-April when Lehnardt learned that JBR\n\nSullivan was also working on developing a fuel additive replacement and they decided to\n\nenter into a joint venture with Disberger, Newton, and Selzer. (Id. at 36-38.)\n\n On first blush Plaintiff\u2019s evidence may appear to support a suspicion that the Amway\n\nDefendants disclosed Plaintiff\u2019s confidential formula for an advanced DurAlt product to the\n\nDNS Defendants. Once developed, however, that evidence loses its suspicious nature.\n\nPlaintiff\u2019s evidence, viewed in the light most favorable to Plaintiff, is not sufficient to create\n\na material issue of fact for trial. Plaintiff simply does not have evidence from which a\n\nreasonable jury could conclude that the Amway Defendants breached the confidentiality\n\nprovisions of the 1995 Licensing Agreement, or that the Amway Defendants and the DNS\n\n\n\n 11\n\f Case 1:07-cv-00460-RHB ECF No. 83 filed 03/31/08 PageID.832 Page 12 of 12\n\n\n\nDefendants misappropriated Plaintiff\u2019s trade secrets. Accordingly, Defendants are entitled\n\nto judgment on Counts II and III of Plaintiff\u2019s complaint alleging breach of contract and\n\nmisappropriation of trade secrets.\n\n An order consistent with this opinion will be entered.\n\n\n\n\nDate: March 31, 2008 /s/ Robert Holmes Bell\n ROBERT HOLMES BELL\n CHIEF UNITED STATES DISTRICT JUDGE\n\n\n\n\n 12\n\f","ocr_status":2,"date_upload":null,"document_number":"83","attachment_number":null,"pacer_doc_id":"09901627988","is_available":true,"is_free_on_pacer":true,"is_sealed":null,"document_type":1,"description":"","acms_document_guid":""}],"date_created":"2017-04-19T04:28:50.650792-07:00","date_modified":"2024-11-12T13:43:21.396830-08:00","date_filed":"2008-03-31","time_filed":null,"entry_number":83,"recap_sequence_number":"2008-03-31.001","pacer_sequence_number":348,"description":"OPINION ; signed by Chief Judge Robert Holmes Bell (Chief Judge Robert Holmes Bell, kcb)","tags":[]},{"resource_uri":"https://www.courtlistener.com/api/rest/v4/docket-entries/16425597/","id":16425597,"docket":"https://www.courtlistener.com/api/rest/v4/dockets/4769275/","recap_documents":[{"resource_uri":"https://www.courtlistener.com/api/rest/v4/recap-documents/17270328/","id":17270328,"tags":[],"absolute_url":"/docket/4769275/52/polar-molecular-corporation-v-amway-corporation/","date_created":"2017-04-19T01:44:52.432595-07:00","date_modified":"2024-11-12T12:51:42.008116-08:00","sha1":"93f8c3af5803d3023e0cbc2e384e8ec8f30a999e","page_count":27,"file_size":170133,"filepath_local":"recap/gov.uscourts.miwd.52829/gov.uscourts.miwd.52829.52.0.pdf","filepath_ia":"https://archive.org/download/gov.uscourts.miwd.52829/gov.uscourts.miwd.52829.52.0.pdf","ia_upload_failure_count":null,"thumbnail":null,"thumbnail_status":0,"plain_text":" Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.490 Page 1 of 27\n\n\n\n UNITED STATES DISTRICT COURT\n FOR THE WESTERN DISTRICT OF MICHIGAN\n SOUTHERN DIVISION\n\n\n\n\nPOLAR MOLECULAR CORPORATION,\n\n Plaintiff,\n File No. 1:07-CV-460\nv.\n HON. ROBERT HOLMES BELL\nAMWAY CORPORATION, et al.,\n\n Defendants,\n\nand\n\nD.N.S. MARKETING COMPANY,\n\n Counter-Plaintiff,\n\nv.\n\nPOLAR MOLECULAR CORPORATION,\n\n Counter-Defendant.\n /\n\n OPINION\n\n Plaintiff Polar Molecular Corporation (\"Polar\") filed this action against twelve\n\ndefendants 1 alleging violations of the Lanham Act, breach of contract, misappropriation of\n\ntrade secrets, conversion, civil conspiracy, and a request for injunctive relief. Defendants\n\n\n 1\n The Defendants are Amway Corporation, Quixtar Inc., Alticor Inc., Access Business\nGroup, Driving Force Technologies LLC, J.B.R. Sullivan Company, D.N.S. Marketing\nCompany, Trans Tech One LLC, Bill Newton, Jeff Selzer, Robert Disberger, and Isabelle's\nLighting.\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.491 Page 2 of 27\n\n\n\nJ.B.R. Sullivan Company, D.N.S. Marketing Company, Bill Newton, Jeff Selzer and Robert\n\nDisberger (collectively the \"DNS Defendants\") have filed an amended motion for judgment\n\non the pleadings pursuant to Federal Rule of Civil Procedure 12(b)(6) and/or 12(c). (Dkt.\n\nNo. 37.) Defendants Amway Corporation, Quixtar Inc., Alticor Inc., and Access Business\n\nGroup L.L.C. (collectively the \"Amway Defendants\") have filed a motion to dismiss\n\npursuant to Federal Rules of Civil Procedure 12(b)(6) and 56 for failure to state a claim\n\nupon which relief can be granted, and for factual deficiency. (Dkt. No. 38.) The DNS\n\nDefendants have filed a concurrence in the Amway Defendants' motion to dismiss. (Dkt.\n\nNo. 40.) For the reasons that follow Defendants' motions to dismiss will be granted in part\n\nand denied in part.\n\n I.\n\n The Court will first address Defendants' motions for dismissal under Rule 12(b)(6)\n\nand Rule 12(c) of the Federal Rules of Civil Procedure. These motions challenge the\n\nsufficiency of Plaintiff's pleadings. The standard of review for a Rule 12(c) motion for\n\njudgment on the pleadings is nearly identical to that employed for a Rule 12(b)(6) motion\n\nto dismiss for failure to state a claim upon which relief can be granted. Kottmyer v. Maas,\n\n436 F.3d 684, 689 (6th Cir. 2006). In reviewing a motion under either rule the court must\n\n\"construe the complaint in the light most favorable to the plaintiff, accept all of the\n\ncomplaint's factual allegations as true, and determine whether the plaintiff undoubtedly can\n\nprove no set of facts in support of the claims that would entitle relief.\" Vickers v. Fairfield\n\n\n\n 2\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.492 Page 3 of 27\n\n\n\nMed. Ctr., 453 F.3d 757, 761 (6th Cir. 2006) (quoting Grindstaff v. Green, 133 F.3d 416,\n\n421 (6th Cir.1998)). However, the court need not accept as true legal conclusions or\n\nunwarranted factual inferences. Kottmyer, 436 F.3d at 688-89.\n\n The allegations in Plaintiff's complaint that are relevant to the motions to dismiss can\n\nbe summarized as follows. Plaintiff, an operating company in the petroleum additives\n\nbusiness, is the owner of numerous patents and trademarks including certain patents\n\ncovering its fuel additive product \"DurAlt.\" (Compl. \u00b6\u00b6 16, 19, 20.) In 1988, 1992, and\n\n1995, Plaintiff entered into a series of agreements with the Amway Defendants, granting the\n\nAmway Defendants the exclusive right to make, use, and sell DurAlt. (Compl. \u00b6\u00b6 18, 24,\n\n31.) The Amway Defendants have been selling Plaintiff's DurAlt product under the label\n\n\"Freedom Fuel\" since 1988 under a licensing agreements with Plaintiff. (Compl. \u00b6\u00b6 19, 60.)\n\nPursuant to the confidentiality provisions of the licensing agreements, Plaintiff has provided\n\nthe Amway Defendants with confidential formulas for DurAlt. (Compl. \u00b6\u00b6 43, 72.)\n\n Defendants Disberger, Newton, and Selzer are top distributors for the Amway\n\nDefendants. (Compl. \u00b6 36.) In 2005 the DNS Defendants entered into agreements with\n\nPlaintiff regarding royalties and fleet sales. (Compl. \u00b6 39.) However, Plaintiff declined to\n\napprove an agreement between the Amway Defendants and J.B.R. Sullivan, one of the DNS\n\nDefendants, that would have permitted J.B.R. Sullivan to manufacture DurAlt.\n\n(Compl. \u00b6 41.) After Plaintiff rejected the agreement between the Amway Defendants and\n\nJ.B.R. Sullivan, the Amway Defendants discontinued the manufacture and sale of DurAlt.\n\n\n\n 3\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.493 Page 4 of 27\n\n\n\n(Compl. \u00b6 42.) The Amway Defendants then provided the confidential formulas for\n\nPlaintiff's DurAlt products to the DNS Defendants in breach of the 1995 License\n\nAgreement. (Compl. \u00b6\u00b6 43, 44, 75.) The DNS Defendants have used the confidential\n\nDurAlt formulas to manufacture a fuel additive under the label \"ProFuel x 2,\" (hereinafter\n\n\"ProFuel\") which is a \"knock off\" of DurAlt. (Compl. \u00b6\u00b6 45-47.) In their marketing of\n\nProFuel, Defendants have told potential customers that the name of the product is \"Freedom\n\n2\" and that they have a licensing agreement with Plaintiff for the manufacture and sale of\n\nthis product. (Compl. \u00b6 49.)\n\nA. Lanham Act\n\n Count I of Plaintiff's complaint alleges that Defendants' use of the name \"Freedom\n\n2\" and their false and misleading statements of fact have caused Plaintiff harm in violation\n\nof section 43(a) of the Lanham Act, 15 U.S.C. \u00a7 1125(a).2 (Compl. \u00b6 52.) Specifically,\n\n 2\n Section 43(a) of the Lanham Act provides in pertinent part:\n\n (1) Any person who, on or in connection with any goods or services, . . . uses\n in commerce any word, term, name, symbol, or device, or any combination\n thereof, or any false designation of origin, false or misleading description of\n fact, or false or misleading representation of fact, which \u2013\n\n (A) is likely to cause confusion, or to cause mistake, or to deceive as to the\n affiliation, connection, or association of such person with another person, or\n as to the origin, sponsorship, or approval of his or her goods, services, or\n commercial activities by another person, . . .\n\n ...\n\n shall be liable in a civil action by any person who believes that he or she is or\n is likely to be damaged by such act.\n\n 4\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.494 Page 5 of 27\n\n\n\nPlaintiff alleges that \"Defendants have told potential and actual customers, throughout the\n\ncountry, that the name of the product is 'Freedom 2' and that there is a licensing agreement\n\nwith Mark Nelson and Plaintiff for the manufacture and sale of this product.\" (Compl. \u00b6\n\n49.)\n\n Defendants move to dismiss Count I of Plaintiff's complaint for failure to state a\n\nclaim under the Lanham Act. Defendants contend that Plaintiff has failed to state a claim\n\nfor trademark infringement because Plaintiff has no interest in the name \"Freedom.\" In\n\nsupport of this argument Defendants rely on MJ & Partners Restaurant Ltd. v. Zadikoff, 10\n\nF. Supp. 2d 922 (N.D. Ill. 1998), where the court held that the holder of a mark is the\n\n\"source\" of the goods, and there can be no likelihood of confusion for purposes of \u00a7 1125(a)\n\nas a matter of law where the product is sponsored by the mark's owner. Id. at 928.\n\nAccording to MJ & Partners, \"'confusion exists only where the public believes that a\n\nproduct is sponsored by the mark's owner when in fact it is not.'\" Id. at 928 (quoting Ballet\n\nMakers, Inc. v. United States Shoe Corp., 633 F. Supp. 1328, 1334 (S.D. N.Y. 1986)).\n\nDefendants contend that because Amway is the owner of the \"Freedom\" mark, under\n\nPlaintiff's own allegations Amway is the \"source\" of the fuel additives sold under both the\n\n\"Freedom Fuel\" and the \"Freedom 2\" marks, so there can be no confusion as a matter of law.\n\n\n\n\n15 U.S.C. \u00a7 1125(a)(1).\n\n\n 5\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.495 Page 6 of 27\n\n\n\n In response to Defendants' motions to dismiss the Lanham Act claim Plaintiff does\n\nnot contest Defendants' representation that the \"Freedom\" mark is owned by the Amway\n\nDefendants; Plaintiff does not allege that it has an interest in the \"Freedom\" mark; and\n\nPlaintiff does not contend that it has stated a claim of trademark infringement based upon\n\nDefendants' use of the \"Freedom\" mark.\n\n The Court finds that Plaintiff has failed to state a claim for trademark infringement\n\nbased upon Defendants' use of the \"Freedom\" mark. A section 43(a) unfair competition\n\nclaim cannot be brought against a defendant who has priority rights to the mark at issue as\n\nagainst the plaintiff. Empresa Cubana del Tabaco v. Culbro Corp., 399 F.3d 462, 478 (2nd\n\nCir. 2005) (holding that Cubatabaco's \u00a7 43(a) claim against General Cigar's use of the\n\nCOHIBA mark could not succeed as a matter of law because General Cigar owned the mark\n\nin the United States and General Cigar's legal right to the COHIBA mark in the United\n\nStates had therefore been established as against Cubatabaco). A plaintiff cannot show a\n\nlikelihood of confusion if it does not have an ownership or other legal interest in the mark:\n\n\n\n\n While Lanham Act \u00a7 43(a)(1)(A) does not explicitly require that the plaintiff\n be the owner of a protectable mark, there is no other way that the requisite\n likelihood of confusion, deception or mistake can occur. That is, unless\n plaintiff is the owner of a valid trademark or service mark, the accused\n designation will not cause a likelihood of confusion.\n\n\n\n\n 6\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.496 Page 7 of 27\n\n\n\n5 J. Thomas McCarthy, McCarthy on Trademarks and Unfair Competition \u00a7 27:13 (4th ed.\n\n2007). Although ownership of a mark is not required for standing to sue under \u00a7 433(a),3\n\n\"where the subject matter of the \u00a7 43(a) claim is a trademark, the plaintiff 'must have some\n\ndiscernable interest in the mark' to have standing to sue.\" McCarthy, supra, \u00a7 27:21 (quoting\n\nShonac Corp. v. AMKO Int'l, Inc., 763 F. Supp. 919 (S.D. Ohio 1991) (decided under the\n\npre-1989 version of Lanham Act \u00a7 43(a)). Because Plaintiff has not alleged that it owns the\n\n\"Freedom\" mark or that it has any other legal interest in the \"Freedom\" mark, the Court\n\nconcludes that Plaintiff cannot state a \u00a7 43(a) Lanham Act claim against Defendants based\n\nupon their use of the \"Freedom\" mark.\n\n Although it appears that Plaintiff has in effect conceded that it has failed to state a\n\nclaim for trademark infringement based upon Defendants' use of the \"Freedom\" mark,\n\nPlaintiff does not concede that it has failed to state a claim under \u00a7 43(a) of the Lanham Act.\n\nInstead, Plaintiff asserts that its complaint has adequately set forth the elements of a claim\n\nfor liability under the Lanham Act because Defendants' false assertion that they purchased\n\nthe rights to Plaintiff's technology with Plaintiff's permission, has caused confusion as to the\n\naffiliation, connection, or association of ProFuel with Plaintiff and as to the origin,\n\nsponsorship, or approval of Defendants' ProFuel. (Dkt. No. 48, Pl. Resp. Br. 12.)\n\n\n\n\n 3\n Standing to sue under \u00a7 43(a) has also been granted to exclusive or non-exclusive\nUnited States distributors of foreign-made branded products and to exclusive licensees of\na mark. McCarthy, supra, \u00a7 27.21 (citing cases).\n\n 7\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.497 Page 8 of 27\n\n\n\n Section 1125(a) of the Lanham Act is not limited to trademark issues. See Gnesys,\n\nInc. v. Greene, 437 F.3d 482, 488-89 (6th Cir. 2005) (\"By the statute's clear language, it is\n\nnot limited to trademark issues.\").\n\n While much of the Lanham Act addresses the registration, use, and\n infringement of trademarks and related marks, . . . 15 U.S.C. \u00a7 1125(a) is one\n of the few provisions that goes beyond trademark protection. As originally\n enacted, [\u00a7 1125(a)] created a federal remedy against a person who used in\n commerce either \"a false designation of origin, or any false description or\n representation\" in connection with \"any goods or services.\"\nDastar Corp. v. Twentieth Century Fox Film Corp., 539 U.S. 23, 28-29 (2003).\n\n The DNS Defendants have not responded to Plaintiff's attempt to salvage its Lanham\n\nAct claim. In their reply brief the DNS Defendants merely restate their argument that\n\nbecause Plaintiff has not alleged that it owns or has a protectible interest in the \"Freedom\"\n\nmark, the Court should dismiss Count I. (Dkt. No. 49, DNS Def. Reply Br. 4.)\n\n The Amway Defendants have recognized that Plaintiff has raised an alternative basis\n\nfor their Lanham Act claim. They nevertheless contend that Plaintiff's attempt to salvage\n\nits Lanham Act claim is futile because it is based on hearsay and because it does not apply\n\nto the Amway Defendants.\n\n On a motion to dismiss under Rule 12(b)(6) or 12(c), the Court must confine its\n\nreview to the allegations in the complaint and accept all of the complaint's factual allegations\n\nas true. Vickers, 453 F.3d at 761. Whether the allegations in the complaint are based on\n\nhearsay is not relevant to a motion under Rule 12(b)(6) or 12(c). Plaintiff has alleged in its\n\ncomplaint that \"Defendants\" have told potential and actual customers that there is a licensing\n\n\n\n 8\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.498 Page 9 of 27\n\n\n\nagreement with Plaintiff for the manufacture and sale of ProFuel. (Compl. \u00b6 56.) The term\n\n\"Defendants\" is broad enough to include the Amway Defendants. Accordingly, the\n\narguments raised by the Amway Defendants do not provide the Court with a basis for\n\ndismissing Plaintiff's Lanham Act claim.\n\n None of the Defendants has directly challenged the legal sufficiency of Plaintiff's\n\nassertion that it has adequately stated a Lanham Act claim based upon Defendants' allegedly\n\nfalse assertion that they purchased the rights to Plaintiff's technology with Plaintiff's\n\npermission, which has caused confusion as to the affiliation, connection, or association of\n\nProFuel with Plaintiff and as to the origin, sponsorship, or approval of Defendants' ProFuel.\n\nAccordingly, the Court will dismiss the Lanham Act claim to the extent it is based upon\n\ntrademark infringement, but the Court declines to rule on the sufficiency of Plaintiff's\n\nLanham Act claim to the extent that it is based upon false statements that have caused\n\nconfusion as to Defendants' association with Plaintiff or as to Plaintiff's sponsorship or\n\napproval of Defendants' goods or commercial activities.\n\nB. Misappropriation of Trade Secret\n\n In Count III of its complaint Plaintiff alleges that Defendants have used improper\n\nmeans to misappropriate Plaintiff's valuable trade secrets in violation of the Michigan\n\ncommon law and the Michigan Uniform Trade Secrets Act (\"MUTSA\"), M.C.L.\n\n\u00a7\u00a7 445.1901-.1910. (Compl. \u00b6 83.)\n\n\n\n\n 9\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.499 Page 10 of 27\n\n\n\n The DNS Defendants have moved to dismiss Count III. They contend that Plaintiff\n\nhas failed to state a claim for trade secret misappropriation because Plaintiff published the\n\nDurAlt formula in a patent. (DNS Def. Br. 5.)\n\n Plaintiff contends that it has adequately stated a claim for misappropriation of trade\n\nsecrets because during the course of its licensing agreement with Amway it provided\n\nAmway with additional improved DurAlt formulas that were not disclosed in the '661 patent,\n\nincluding the specific formula at issue in the present litigation, i.e., the formula utilized for\n\nProFuel. (Pl. Resp. Br. 12.)\n\n \"Under Michigan law, '[t]o be a trade secret, the information must, of necessity, be\n\na Secret.'\" Wysong Corp. v. M.I. Indus., 412 F. Supp. 2d 612, 626 (E.D. Mich. 2005)\n\n(quoting Kubik, Inc. v. Hull, 56 Mich. App. 335, 347, 224 N.W.2d 80 (1974)). \"Trade\n\nsecrets do not 'encompass information which is readily ascertainable, i.e., capable of being\n\nacquired by competitors or the general public without undue difficulty or hardship.'\" Id.\n\n(quoting Kubik, Inc., 56 Mich. App. at 348). \"The property right in a trade secret ceases\n\nto exist after the secret has become public property through general disclosure. If a trade\n\nsecret is patented there is no further right to secrecy.\" Scharmer v. Carrollton Mfg. Co.,\n\n525 F.2d 95, 99 (6th Cir. 1975).\n\n Although information disclosed in a patent cannot be a trade secret, and although\n\npatents are required to contain a written description of the invention in sufficient detail to\n\nenable a person skilled in the art to make and use the invention, 35 U.S.C. \u00a7 112, the\n\n\n\n 10\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.500 Page 11 of 27\n\n\n\nexistence of a patent covering the general subject matter does not necessarily mean that the\n\npatent disclosed the specific formula (the trade secret) used to produce a specific commercial\n\nproduct. See Bd. of Regents, Univ. of Tex. Sys., ex rel. Univ. of Tex. at Austin v. Nippon Tel.\n\nand Tel. Corp., 414 F.3d 1358, 1365 (Fed. Cir. 2005) (rejecting argument that trade secret\n\nclaims were extinguished by the filing of a patent application); Carbo Ceramics, Inc. v.\n\nKeefe, 166 F. App'x 714, 720 (5th Cir. 2006) (\"Given the existence of conflicting evidence\n\nfrom which a reasonable person might draw differing conclusions, it is clear that the jury\n\ncould have concluded \u2013 and apparently did conclude \u2013 that the patents did not reveal Carbo's\n\ntrade secrets.\").\n\n Plaintiff has alleged in its complaint that \"through various contracts with Plaintiff, the\n\nAmway Companies gained confidential information, specifically the formulae for DurAlt.\"\n\n(Compl. \u00b6 72.) Plaintiff has further alleged that the information was not known to others\n\nand that it gave Plaintiff a competitive advantage over other businesses that did not have\n\naccess to this information. (Compl. \u00b6\u00b6 73-74.)\n\n The Court is satisfied that the allegations in Plaintiff's complaint, construed in the\n\nlight most favorable to Plaintiff, see Vickers, 453 F.3d at 761, are sufficient to state a claim\n\nfor misappropriation of trade secret. The DNS Defendants' motion to dismiss Plaintiff's\n\ntrade secret misappropriation claim under the MUTSA, as alleged in Count III, will\n\naccordingly be denied.\n\nC. Common Law Misappropriation, Conversion, and Civil Conspiracy\n\n\n\n 11\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.501 Page 12 of 27\n\n\n\n Defendants contend that Plaintiff's common law misappropriation, conversion, and\n\ncivil conspiracy claims found in Counts III, IV and V are legally preempted or displaced by\n\nsection 8 of the MUTSA.4\n\n The MUTSA displaces claims that are \"based solely upon the misappropriation of a\n\ntrade secret.\" Bliss Clearing Niagara, Inc. v. Midwest Brake Bond Co., 270 F. Supp. 2d\n\n943, 946 (W.D. Mich. 2003) (Quist, J.). If a claim is based solely upon the misappropriation\n\nof a trade secret, the claim must be dismissed. Id. However, claims based upon wrongful\n\nconduct independent of the misappropriation of trade secrets are not displaced by the\n\nMUTSA. Id. at 950. In Bliss Clearing the court held that the plaintiff's conversion claim\n\nwas preempted because the allegations centered exclusively on the defendant's allegedly\n\nunauthorized use of the plaintiff's trade secrets. Id. at 950. The court held that the plaintiff's\n\n 4\n Section 8 of the MUTSA provides:\n\n (1) Except as provided in subsection (2), this act displaces conflicting tort,\n restitutionary, and other law of this state providing civil remedies for\n misappropriation of a trade secret.\n\n (2) This act does not affect any of the following:\n\n (a) Contractual remedies, whether or not based upon misappropriation of a\n trade secret.\n\n (b) Other civil remedies that are not based upon misappropriation of a trade\n secret.\n\n (c) Criminal remedies, whether or not based upon misappropriation of a trade\n secret.\n\nM.C.L. \u00a7 445.1908.\n\n 12\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.502 Page 13 of 27\n\n\n\ncommon law misappropriation claim was also preempted because the plaintiff had not\n\nattempted to distinguish its common law claim from its MUTSA statutory claim. Id. at 951.\n\nFinally, the court held that to the extent the plaintiff's tortious interference and unfair\n\ncompetition claims were based upon the theft or misuse of trade secrets they would be\n\npreempted, but because the plaintiff had also alleged wrongful conduct independent of the\n\ndefendant's alleged trade secret misappropriation, the court denied the motion to dismiss\n\nthese counts. Id. at 949-50. See also Wysong Corp. v. M.I, Indus., 412 F. Supp. 2d 612,\n\n623-25 (E.D. Mich. 2005) (holding that the MUTSA displaced the portions of the unjust\n\nenrichment and conspiracy claims that allege enrichment from misappropriation, but not\n\nthose portions based on wrongful acts independent of misappropriation, such as the alleged\n\nsale of deceptively similar products, or the alleged breaches of duty for creating a product\n\nline).\n\n Plaintiff has not attempted to distinguish its common law misappropriation claim\n\nfrom its statutory claim. Therefore, to the extent that Count III relies on a common law\n\nclaim of misappropriation of trade secrets, the claim is displaced by the MUTSA. See Bliss\n\nClearing, 270 F. Supp. 2d at 951 (dismissing common law misappropriation claim).\n\n Plaintiff does, however, dispute Defendants' contention that its conversion and\n\nconspiracy claims are displaced by the MUTSA. Plaintiff contends that it has set forth a\n\nviable conversion claim because it has alleged wrongful conduct independent of the alleged\n\ntrade secret misappropriation, i.e. breach of contract. Plaintiff has alleged that the Amway\n\n\n\n 13\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.503 Page 14 of 27\n\n\n\nDefendants \"took Plaintiff's formula for DurAlt, in violation of the 1995 License Agreement,\n\nand converted it to their own use by providing this formula to JBR Sullivan and DNS\n\nMarketing, through Newton, Selzer and Disberger.\" (Compl. \u00b6 85.) Plaintiff specifically\n\ndirects the Court's attention to paragraph 5 of the Licence Agreement.\n\n Contrary to Plaintiff's assertions, Plaintiff's conversion claim is based solely upon the\n\nmisappropriation of a trade secret. Paragraph 5 of the License Agreement specifically\n\nprovides that the obligations of confidence and non-use \"shall not apply to information\n\nwhich . . . was known to recipient prior to disclosure hereunder\" or was \"known to the\n\ngeneral public.\" (Compl. Ex. 8, 1995 Lic. Agrm't \u00b6 5.) Because the confidentiality and non-\n\nuse provision that was allegedly breached only applies to trade secrets, Plaintiff's conversion\n\nclaim is based solely upon the theft or misuse of a trade secret. Accordingly, Plaintiff's\n\nconversion claim is displaced by the MUTSA.\n\n With respect to its conspiracy claim, Plaintiff contends that Defendants have failed\n\nto cite any Michigan appellate case which has ruled that a civil conspiracy claim is\n\npreempted under Michigan law, and that, in any event, Plaintiff's allegation that Defendants\n\nhave deceptively marketed a knock off product is sufficient to state a claim that is not\n\ndisplaced by the MUSTA.\n\n In CMI International, Inc. v. Intermet International Corp., 251 Mich. App. 125, 649\n\nN.W.2d 808 (2002), the plaintiff filed an action alleging breach of contract, violation of the\n\nMUTSA, tortious interference with contractual relations, unjust enrichment and constructive\n\n\n\n 14\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.504 Page 15 of 27\n\n\n\ntrust, inevitable breach of trust and fiduciary duty, and conspiracy. Id. at 128. After\n\naffirming the summary disposition of the plaintiff's breach of contract and tortious\n\ninterference claims, the court held that \"CMI's remaining claims [which included the\n\nconspiracy claim] necessarily are based on Michigan's UTSA, because that statute displaced\n\nconflicting tort remedies for misappropriation of a trade secret.\" Id. at 132 (discussed in\n\nWysong , 412 F. Supp. 2d at 623). In Wysong, the court, relying in part on CMI\n\nInternational, held that the plaintiff's conspiracy claim was displaced by the MUTSA to the\n\nextent that it was based on the wrongful theft of secret information, but that the claim\n\nsurvived to the extent that it was based on the alleged sale of deceptively similar products\n\nand allegations of breaches of duty for creating a product line. 412 F. Supp. 2d at 624-25.\n\n Plaintiff alleges in its complaint that \"the Defendants worked together in a concerted\n\naction to unlawfully obtain the patented formulas for DurAlt to be used in the manufacture\n\nand sale of a knock-off product.\" (Compl. \u00b6 94.) Plaintiff has also alleged that\n\n\"Defendants, through this conspiracy, misappropriated Plaintiff's trade secrets and converted\n\nPlaintiff's property in an effort to produce and sell a knock-off product.\" (Compl. \u00b6 99.) To\n\nthe extent Plaintiff's conspiracy claim is based upon the alleged theft of a trade secret, the\n\nclaim is displaced by the MUTSA. Under a liberal reading of Plaintiff's complaint, however,\n\nthe Court believes it is possible to understand Plaintiff's conspiracy claim as being based,\n\nat least in part, on palming-off or unfair competition. For example, Plaintiff refers to\n\nProFuel as a \"knock-off\" of DurAlt (Compl. \u00b6 46), and alleges that Defendants falsely stated\n\n\n\n 15\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.505 Page 16 of 27\n\n\n\nthat they have a licensing agreement from Plaintiff, that Defendants have used the name\n\n\"Freedom 2,\" and that Defendants' marketing employs testimonials nearly identical to those\n\nused to sell the licensed Freedom Fuel product. (Compl. \u00b6 49 & n.6.)\n\n For the reasons stated above, the Court will grant Defendants' motion to dismiss\n\nPlaintiff's common law trade secret misappropriation claim and Plaintiff's conversion claim,\n\nbut will deny Defendant's motion to dismiss Plaintiff's conspiracy claim except to the extent\n\nthat the conspiracy claim is based upon trade secret misappropriation.\n\nD. Injunctive Relief\n\n Defendants contend that Count IV, Request for Permanent Injunction, should be\n\ndismissed because it fails to state a claim on which relief can be granted. In support of their\n\nmotion Defendants assert that an injunction is a remedy rather than a separate cause of\n\naction. See Klay v. United Healthgroup, Inc., 376 F.3d 1092, 1098 (11th Cir. 2004) (\"[A]\n\ntraditional injunction is a remedy potentially available only after a plaintiff can make a\n\nshowing that some independent legal right is being infringed . . . .\").\n\n Plaintiff has clarified in its response that its purpose in including Count VI was\n\nmerely to identify a request for injunctive relief and was never intended to state separate\n\ncause of action. With that understanding, the Court denies Defendants' motion to dismiss\n\nCount VI. E. Personal Jurisdiction over Newton, Disberger, and Selzer\n\n Defendants Newton, Disberger, and Selzer move to dismiss the complaint against\n\nthem because the complaint fails to assert any facts supporting the Court's exercise of\n\n\n\n 16\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.506 Page 17 of 27\n\n\n\npersonal jurisdiction over them. These Defendants have not directly challenged the\n\nexistence of personal jurisdiction over them. Through this motion they merely challenge\n\nPlaintiff's alleged failure to plead facts to support the exercise of personal jurisdiction over\n\nthem.\n\n The individual DNS Defendants cite no authority in support of such a pleading\n\nrequirement, and the authority the Court has located is to the contrary. General rules of\n\npleading are governed by Federal Rule of Civil Procedure 8(a), which requires a complaint\n\nto contain a short and plain statement of grounds on which the court's jurisdiction depends,\n\nthe claim, and the relief requested. Fed. R. Civ. P. 8(a). For purposes of Rule 8,\n\n\"jurisdiction\" refers to subject matter jurisdiction. 2 James Wm. Moore et al., Moore's\n\nFederal Practice \u00a7 8.03[1] (3d ed. 2007). There is no requirement that the complaint allege\n\na basis for asserting personal jurisdiction over the defendant. See 4 Charles Alan Wright et\n\nal., Federal Practice and Procedure \u00a7 1067.6 (3d ed. 2007) (collecting cases and noting that\n\n\"strictly speaking, under Federal Rule 8(a) plaintiffs are not required to plead the basis for\n\npersonal jurisdiction over defendants\"). Accord In re Enron Corp., 316 B.R. 434, 439\n\n(Bankr. S.D.N.Y. 2004) (rejecting motion to dismiss for failure to allege facts supporting\n\npersonal jurisdiction because Rule 8(a)(1) does not apply to personal jurisdiction);\n\nD'Addario v. Geller, 264 F. Supp. 2d 367, 390 n.29 (E.D. Va. 2003) (basing finding of\n\npersonal jurisdiction on a ground not raised in the pleadings). While the plaintiff bears the\n\nburden of establishing the court's personal jurisdiction over the defendant, Neogen Corp.\n\n\n\n 17\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.507 Page 18 of 27\n\n\n\nv. Neo Gen Screening, Inc., 282 F.3d 883, 887 (6th Cir. 2002), there is no requirement that\n\nthe Plaintiff allege facts to support that burden in its pleadings. The DNS Defendants' Rule\n\n12(b)(6) motion to dismiss Defendants Newton, Disberger, and Selzer because the complaint\n\nfails to assert facts supporting the Court's exercise of personal jurisdiction over them will\n\naccordingly be denied.\n\n III.\n\n In addition to challenging the legal sufficiency of Plaintiff's pleadings, the Amway\n\nDefendants have moved for summary judgment on Counts II and III pursuant to Rule 56\n\nbased upon their contention that these counts are factually deficient. The DNS Defendants\n\nhave concurred in this motion.5\n\n Under Rule 56(c) of the Federal Rules of Civil Procedure, summary judgment is\n\nproper if there is no genuine issue as to any material fact and the moving party is entitled to\n\njudgment as a matter of law. In evaluating a motion for summary judgment the Court must\n\nlook beyond the pleadings and assess the proof to determine whether there is a genuine need\n\nfor trial. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). If\n\nDefendants carry their burden of showing there is an absence of evidence to support a claim\n\nthen Plaintiff must demonstrate by affidavits, depositions, answers to interrogatories, and\n\nadmissions on file, that there is a genuine issue of material fact for trial. Celotex Corp. v.\n\nCatrett, 477 U.S. 317, 324-25 (1986).\n\n\n\n 5\n The Count II breach of contract claim is directed only at the Amway Defendants.\n\n 18\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.508 Page 19 of 27\n\n\n\n In considering a motion for summary judgment, the court must construe the evidence\n\nand draw all reasonable inferences in favor of the nonmoving party. Minges Creek, L.L.C.\n\nv. Royal Ins. Co. of America, 442 F.3d 953, 955-56 (6th Cir. 2006) (citing Matsushita, 475\n\nU.S. at 587). Nevertheless, the mere existence of a scintilla of evidence in support of\n\nPlaintiff's position is not sufficient to create a genuine issue of material fact. Anderson v.\n\nLiberty Lobby, Inc., 477 U.S. 242, 252 (1986). The proper inquiry is whether the evidence\n\nis such that a reasonable jury could return a verdict for Plaintiff. Id.; see generally, Street\n\nv. J.C. Bradford & Co., 886 F.2d 1472, 1476-80 (6th Cir. 1989).\n\nA. Reasonable Efforts Under \u00b6 11.1\n\n Plaintiff's breach of contract claim in Count II alleges that the Amway Defendants\n\nbreached the 1995 License Agreement in 2006 in two distinct manners: by disclosing\n\nconfidential information, and failing to use reasonable efforts to offer DurAlt to their\n\naffiliates and subsidiaries. (Compl. \u00b6 68.) The Court will first address Plaintiff's allegation\n\nthat the Amway Defendants breached the Agreement by \"refusing to perform\" and failing\n\nto use \"reasonable efforts\" to offer DurAlt to their affiliates/subsidiaries worldwide in\n\nviolation of paragraph 11.1. (Compl. \u00b6 68(A), (E).) Plaintiff's allegation that the Amway\n\nDefendants breached the Agreement by disclosing confidential information will be\n\naddressed in section III.B below.\n\n The Amway Defendants contend they are entitled to summary judgment on Plaintiff's\n\nclaim that they breached paragraph 11.1 because this claim is barred by the six year statute\n\n\n\n 19\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.509 Page 20 of 27\n\n\n\nof limitations applicable to contract actions. See M.C.L. \u00a7 600.5807(8) (setting a six year\n\nlimitations period for actions to recover damages for breach of contract). The Amway\n\nDefendants, citing paragraph 11.2, contend that any obligation they had to use reasonable\n\nefforts to offer the product to their affiliates ended five years after the execution of the\n\ncontract, which was more than six years before Plaintiff filed this suit.\n\n Plaintiff contends that the five year period referenced in paragraph 11.2 only concerns\n\nthe Amway Defendants' exclusive right to market the product and does not limit the period\n\nduring which the Amway Defendants were obligated to use reasonable efforts to offer the\n\nproduct to their affiliates. Plaintiff contends that if the Court finds that paragraphs 11.1 and\n\n11.2 are interrelated, an ambiguity exists which must be resolved by a jury. (Pl. Resp. Br.\n\n17 n.14.)\n\n \"The cardinal rule in the interpretation of contracts is to ascertain the intention of the\n\nparties.\" City of Grosse Pointe Park v. Mich. Mun. Liab. and Prop. Pool, 473 Mich. 188,\n\n197, 702 N.W.2d 106 (2005) (quoting McIntosh v. Groomes, 227 Mich. 215, 218, 198 N.W.\n\n954 (1924)). Contracts should be read as a whole, \"giving harmonious effect, if possible,\n\nto each word and phrase.\" Wilkie v. Auto-Owners Ins. Co., 469 Mich. 41, 50 n.11, 664\n\nN.W.2d 776 (2003). If the language of a contract is clear and unambiguous, it is to be\n\nconstrued according to its plain sense and meaning. Gross Pointe, 473 Mich. at 198.\n\n\"'Where a contract is to be construed by its terms alone, it is the duty of the court to interpret\n\nit; but where its meaning is obscure and its construction depends upon other and extrinsic\n\n\n\n 20\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.510 Page 21 of 27\n\n\n\nfacts in connection with what is written, the question of interpretation should be submitted\n\nto the jury, under proper instructions.'\" Klapp v. United Ins. Group Agency, Inc., 468 Mich.\n\n459, 469, 663 N.W.2d 447 (2003) (quoting O'Connor v. March Automatic Irrigation Co.,\n\n242 Mich. 204, 210, 242 N.W. 784 (1928)).\n\n Paragraph 11 of the License Agreement, which is entitled \"Worldwide Sales of the\n\nProduct\" provides:\n\n 11.1 AMWAY has a worldwide Direct Sales network of affiliates and\n subsidiaries that have been or will be offered the opportunity to market and\n sell the Product through their distributors. PMC [Polar Molecular\n Corporation] understands that the decision on whether or not an affiliate or\n subsidiary of AMWAY markets any product offered by AMWAY is within\n the sole discretion and control of the affiliate or subsidiary. AMWAY agrees\n that it will use its reasonable efforts to offer the Product to its affiliates and\n subsidiaries worldwide for their determination as to the marketability of the\n Product in their country.\n\n 11.2 In the event AMWAY does not offer the Product within five (5) years\n of the Execution Date to an affiliate or subsidiary of AMWAY responsible for\n marketing AMWAY products in countries where AMWAY products are\n currently being actively marketed, then AMWAY's exclusive right to market\n the Product in that specific country only as granted by Section 2.1 shall\n terminate.\n\n(1995 Lic. Agrm't \u00b6 11 (emphasis added).)\n\n The Amway Defendants contend that paragraph 11.2 sets the term of the \"reasonable\n\nefforts\" obligation of paragraph 11.1 at five years and establishes that the penalty for non-\n\nperformance is the loss of the exclusive right to market the Product in the specific country\n\nwhere the product was not offered during that five year period.\n\n\n\n\n 21\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.511 Page 22 of 27\n\n\n\n Plaintiff contends that paragraphs 11.1 and 11.2 are two separate and distinct contract\n\nprovisions and that they should not be read together. According to Plaintiff, even if Amway\n\nloses its exclusive right to market the product under paragraph 11.2, it still retains its right\n\nto market the product and is still obligated to make reasonable efforts to market the product\n\nunder paragraph 11.1.\n\n Plaintiff's proposed construction of the reasonable efforts requirement is not\n\npersuasive. Contrary to Plaintiff's assertions, paragraphs 11.1 and 11.2, when read in\n\nsequence, are clearly tied together. In paragraph 11.1 Plaintiff acknowledges that any\n\ndecision on whether to market any product offered by AMWAY is within the sole discretion\n\nand control of the affiliate or subsidiary. Amway agrees, nevertheless, to use its best efforts\n\nto offer the product to its affiliates and subsidiaries. Paragraph 11.2 provides that if Amway\n\ndoes not offer the product to Amway affiliates in a particular country in the first five years\n\nof the contract, Amway will lose its exclusive license to market the product in that particular\n\ncountry. Loss of the exclusive license is a substantial penalty because the entire contract is\n\ndirected toward the grant of an exclusive license to Amway.6 To suggest that Amway has\n\na continuing obligation to use reasonable efforts to offer the product to its affiliates more\n\nthan five years after the execution of the contract would render the five year provision in\n\n 6\n The License Agreement's \"whereas\" clauses provide that \"PMC has the right and\ndesire to grant AMWAY an exclusive license\" and \"AMWAY desires to obtain an exclusive\nlicence from PMC.\" (1995 Lic. Agrm't, p. 1 (emphasis added).) The license granted under\nthe contract is \"the exclusive right and license to use and Practice the Licensed Technology\nin the Field and to make, have made, use and sell the Product in the Field.\" (Id. at \u00b6 2.1\n(emphasis added).)\n\n 22\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.512 Page 23 of 27\n\n\n\nparagraph 11.2 meaningless. It would also render paragraph 4.5 meaningless. Paragraph\n\n4.5 provides:\n\n\n This Agreement shall automatically terminate in the event AMWAY fails to\n purchase Product from its manufacturer/supplier for a period of one (1) full\n year, except if AMWAY's failure to purchase Product is due to reasons\n beyond AMWAY's control.\n\n(1995 Lic. Agrm't \u00b6 4.5.) If Amway had a continuing obligation to use its reasonable efforts\n\nto offer the Product to its affiliates beyond the five year term, it would not be able to\n\nexercise its negotiated right to terminate the contract under paragraph 4.5.\n\n The Court concludes that Paragraph 11.1 of the License Agreement is not ambiguous.\n\nWhen the License Agreement is read as a whole, paragraph 11.1 admits of but one\n\ninterpretation: the obligation to use reasonable efforts to market the Product in paragraph\n\n11.1 is limited to the five year period described in paragraph 11.2.\n\n In light of this construction, Plaintiff cannot prevail on its claim that in 2006 the\n\nAmway Defendants breached the obligation to use reasonable efforts under paragraph 11.1.\n\nUnder the 1995 License Agreement the Amway Defendants did not have an obligation to\n\nuse reasonable efforts in 2006, and to the extent Plaintiff contends they failed to use\n\nreasonable efforts in the first five years of the contract, those claims are barred by the six\n\nyear statute limitations applicable to contracts. The Amway Defendants are accordingly\n\nentitled to summary judgment on Plaintiff's breach of contract claim to the extent it is based\n\nupon a breach of paragraph 11.1.\n\n\n\n 23\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.513 Page 24 of 27\n\n\n\n\nB. Trade Secrets\n\n Defendants contend that they are entitled to judgment on Count III, alleging\n\nmisappropriation of trade secrets, and on Count II to the extent that it alleges breach of\n\ncontract based on disclosure of confidential material, because the uncontroverted facts show\n\nthat the Amway Defendants did not provide any confidential formula to any unauthorized\n\nthird party and because Plaintiff's allegedly confidential formula was the subject of an\n\nexpired patent and was readily reverse engineered. In support of this motion Defendants\n\nhave provided declarations from Amway employees Michael Sullivan, Robert D. Faber, and\n\nLinda Emperor, from Defendants Newton, Disberger, and Selzer, and from Stephen\n\nLehnardt, a managing member of Defendants Trans Tech One, L.L.C. and Driving Force\n\nTechnologies, L.L.C. (Dkt. No. 38, Amway Defs. Mot., Ex. 2-8.) These seven affidavits\n\nuniformly state that there has been no unauthorized disclosure of any of Plaintiff's\n\nconfidential fuel additive formulas and that ProFuel was independently developed through\n\nreverse engineering based on an analysis of Amway's Freedom Fuel product and the fuel\n\nadditive technology disclosed in Plaintiff's expired U.S. Patent No. 4,753,661.\n\n In response to the motion for summary judgment Plaintiff has presented evidence that\n\nit supplied the Amway Defendants with the formulas for more advanced versions of DurAlt\n\npursuant to the confidentiality provisions of the License agreement, (Pl. Resp., Nelson Aff.\n\n\u00b6 12); that the chemical scan of ProFuel is nearly identical to DurAlt Gasoline Fuel\n\n\n\n 24\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.514 Page 25 of 27\n\n\n\nConditioner, the formula for which was supplied to the Amway Defendants, (Compl. Ex.\n\n15; Nelson Aff. \u00b6 24); that ProFuel has been advertised for sale through Amway websites,\n\n(Pl. Ex. 6, 11); that the ProFuel testimonials are nearly identical to those used for Freedom\n\nFuel (Nelson Aff. \u00b6 29); that the Amway Defendants generally require a lengthy product\n\nclaims verification procedure, (Nelson Aff. \u00b6 22); and that the rapid introduction of ProFuel\n\nfor sale through Amway approved websites suggests that Defendants relied on Plaintiff's\n\nconfidential test data, (Nelson Aff. \u00b6\u00b6 21-22).\n\n The evidence presented by Plaintiff is not sufficient to controvert the evidence\n\nproduced by the Amway Defendants. While Plaintiff suspects improper disclosure of its\n\nconfidential formula and doubts that ProFuel was developed through reverse engineering\n\nfrom public information, Plaintiff's suspicions and doubts are not sufficient to establish the\n\nexistence of a genuine issue of material fact for trial. Plaintiff contends, however, that the\n\nCourt should not rule on Defendants' motion for summary judgment until Plaintiff has had\n\nan opportunity for discovery.\n\n Rule 56(f) provides:\n\n Should it appear from the affidavits of a party opposing the motion that the\n party cannot for reasons stated present by affidavit facts essential to justify the\n party's opposition, the court may refuse the application for judgment or may\n order a continuance to permit affidavits to be obtained or depositions to be\n taken or discovery to be had or may make such other order as is just.\n\nFed. R. Civ. P. 56(f). Rule 56(f) requires a party opposing a summary judgment motion to\n\nfile an affidavit that \"'indicate[s] to the district court its need for discovery, what material\n\n\n\n 25\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.515 Page 26 of 27\n\n\n\nfacts it hopes to uncover, and why it has not previously discovered the information.'\"\n\nGettings v. Building Laborers Local 310 Fringe Benefits Fund, 349 F.3d 300, 305 (6th Cir.\n\n2003) (quoting Cacevic v. City of Hazel Park, 226 F.3d 483, 488 (6th Cir.2000)). See also,\n\nWallin v. Norman, 317 F.3d 558, 564 (6th Cir.2003) (requiring the non-moving party to (1)\n\nfile an affidavit that details the discovery needed, and (2) explain how it will help rebut the\n\nmovant's showing of the absence of a genuine issue of material fact).\n\n In support of its request for discovery Plaintiff has offered the affidavit of its attorney,\n\nRussell Babcock. Mr. Babcock has indicated that Plaintiff and its agents were obviously and\n\nintentionally left out of the interactions and conduct which the declarants reference in their\n\ndeclarations, that the interactions and conduct described are highly suspect and improbable,\n\nand that in order to challenge these self-serving declarations and to adequately defend\n\nagainst Defendants' motion, Plaintiff must have an opportunity to conduct discovery.\n\n(Babcock Aff. \u00b6\u00b6 5-6, 8.) Plaintiff requests an opportunity to depose the declarants, their\n\ndistributors, Defendants' agents, and other witnesses, and to seek information and documents\n\nregarding the alleged research which resulted in Defendants' development of ProFuel and\n\ninformation and documents surrounding the interaction of Defendants in the context of\n\nFreedom Fuel and ProFuel. (Babcock Aff. \u00b6 7.)\n\n The Court is satisfied that Plaintiff has shown a need for some discovery to resolve\n\nthe issues of misappropriation of trade secret and the disclosure of confidential information.\n\nThe Court accordingly declines to rule on Defendants' motion for summary judgment on\n\n\n\n 26\n\f Case 1:07-cv-00460-RHB ECF No. 52 filed 11/14/07 PageID.516 Page 27 of 27\n\n\n\nCount III and on that portion of Count II that is based upon breach of the License\n\nAgreement's confidentiality provision. Discovery will be limited to a sixty day period, and\n\nwill be confined to the issues of the Amway Defendants' alleged disclosure of Plaintiff's\n\nadvanced DurAlt formula to the other Defendants and the development of the formula for\n\nProFuel. Following the close of this limited discovery period Plaintiff will have 21-days to\n\nfile a supplemental brief, and Defendants will have 14-days thereafter to file a reply.\n\n An order consistent with this opinion will be entered.\n\n\n\n\nDate: November 14, 2007 /s/ Robert Holmes Bell\n ROBERT HOLMES BELL\n CHIEF UNITED STATES DISTRICT JUDGE\n\n\n\n\n 27\n\f","ocr_status":2,"date_upload":null,"document_number":"52","attachment_number":null,"pacer_doc_id":"0990748647","is_available":true,"is_free_on_pacer":true,"is_sealed":null,"document_type":1,"description":"","acms_document_guid":""}],"date_created":"2017-04-19T01:44:52.377286-07:00","date_modified":"2024-11-12T12:51:41.985351-08:00","date_filed":"2007-11-14","time_filed":null,"entry_number":52,"recap_sequence_number":"2007-11-14.001","pacer_sequence_number":229,"description":"OPINION ; signed by Chief Judge Robert Holmes Bell (Chief Judge Robert Holmes Bell, kcb)","tags":[]}],"entries_total":"https://www.courtlistener.com/api/rest/v4/docket-entries/?count=on&docket=4769275&page_size=40"}