Dueling Coupon Websites See Lawsuit Revived
(CN) - A coupon website may have a case against the print-based competitor that looked to the online market after an industry conference in Las Vegas, the 5th Circuit ruled.
Brand Coupon Network has been courting Internet users since 2004 and allegedly shared its business plans with Catalina Marketing Corp. in April 2010 at an annual conference held by the Association of Coupon Professionals.
It said Catalina had purported to be involved "only in the print coupon business," but launched CouponNetwork.com around the same time as the conference at the Venetian in Las Vegas, or shortly thereafter.
Brand Coupon Network filed suit in July 2011 because Catalina's website was strikingly similar to its own: BrandCouponNetwork.com.
A federal judge in Baton Rouge, La., soon dismissed the suit for failure to state a claim for trade-secret violation and for missing the one-year statute of limitations.
In a partial reversal Tuesday, the New Orleans-based federal appeals court said the trial judge erred in deeming the case time-barred.
To find that the deadline had passed, the trial court relied on outside evidence that purportedly showed Brand Coupon Network had knowledge of Catalina's website back in April 2010.
Brand Coupon Network meanwhile claims it did not have "actual knowledge of any injury" until the fall of 2010, and those few months make all the difference.
"When interpreting BCN's petition, the District Court considered exhibits attached to BCN's opposition to defendants' motion to dismiss, noting in its order that 'Plaintiff's memorandum in opposition to the present motion appears to factually augment the complaint timeline,'" Judge Jacques Wiener Jr. wrote for the three-judge panel. "The District Court further found the evidence to be 'largely diminished and defeated by [BCN's] own allegations in the original complaint.' Yet the evidence was not a referent of the petition, nor could it have been: The affidavit was signed on September 12, 2011, a day before BCN filed its opposition to defendants' motion to dismiss, and weeks after the filing of the petition. We conclude that the district court erred when it considered evidence outside the pleadings - and not referred to therein - without converting the motion to dismiss into a motion for summary judgment. Moreover, when viewed in light of the record before us, a genuine issue of material fact appears to exist, which would preclude summary judgment."
The nine-page ruling describes the affidavit of BCN founder Daniel Abraham as containing "his clear statement that he had no knowledge of defendant's actions, and no knowledge of the damage to his business, before October 2010."
Though the appeals court revived BCN's claims against Catalina, it affirmed the dismissal of three individual defendants - Pamela Samniego, Joe Henson and L. Dick Buell - because their allegations failed to justify "the extraordinary remedy of piercing the corporate veil.