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International Foundation of Employee Benefit Plans, Inc. v. Cottrell

United States District Court, D. Maryland, Northern Division

January 7, 2015

INTERNATIONAL FOUNDATION OF EMPLOYEE BENEFIT PLANS, INC, et al., Plaintiffs,
v.
WENDY J. COTTRELL, Defendant.

MEMORANDUM OPINION

WILLIAM D. QUARLES, Jr., District Judge.

International Foundation of Employee Benefit Plans, Inc., and its subsidiary, Certified Employee Benefit Specialists, Inc., (together, "IFEBP") sued Wendy J. Cottrell, d/b/a HR Vantage, for false advertising, trademark infringement, and other claims. ECF No. 1.[1] Pending is Cottrell's pro se motion to dismiss for failure to state a claim. ECF No. 7. No hearing is necessary. Local Rule 105.6 (D. Md. 2014). For the following reasons, Cottrell's motion will be denied.

I. Background

A. Facts[2]

IFEBP is a Wisconsin nonprofit organization specializing in employee benefits, compensation, and financial literacy education and information. ECF No. 1 ¶ 9. IFEBP trains and certifies professionals in employee benefits and compensation. Id. ¶ 10. IFEBP owns protected U.S. federal trademark registrations for "CEBS®"[3] and "Certified Employee Benefits Specialist®."[4] Id. ¶¶ 11, 31. Cottrell owns and operates HR Vantage, which provides disability retirement counseling to federal employees. ECF No. 7-1 at 1.

Individuals certified by IFEBP may use the CEBS® and Certified Employee Benefits Specialist® designations. ECF No. 1 ¶ 12. Cottrell's website and LinkedIn profile page display both designations; however, Cottrell has never been certified by IFEBP. Id. ¶¶ 13-14, 20.[5] IFEBP does not have any record of Cottrell completing the examinations necessary to become certified. Id. ¶ 15.[6]

Cottrell's use of the CEBS® and Certified Employee Benefits Specialist® designations has caused "lost sales of [IFEBP's] educational and examination fees." Id. ¶ 25. IFEBP's reputation has suffered because Cottrell "is providing sub-standard services, " and "customers receiving such sub-standard services from Cottrell will presume... that [IFEBP has] certified [Cottrell's] sub-standard services." Id. ¶ 26. Cottrell's use of the designations "is willful and intentional, done expressly for the purpose of trading upon the valuable goodwill and public recognition built up by [IFEBP] in its intellectual property." Id. ¶ 37.

B. Procedural History

On April 15, 2014, IFEBP sued Cottrell for false advertising, trademark infringement, false designation, and unfair competition under the Lanham Act, [7] and for common law fraudulent misrepresentation. ECF No. 1.[8] On May 20, 2014, Cottrell moved to dismiss the complaint for failure to state a claim. ECF No. 7. On May 28, 2014, IFEBP opposed the motion. ECF No. 8.

II. Analysis

A. Legal Standard for the Motion to Dismiss

Under Federal Rule of Civil Procedure 12(b)(6), an action may be dismissed for failure to state a claim upon which relief can be granted. Rule 12(b)(6) tests the legal sufficiency of a complaint, but does not "resolve contests surrounding the facts, the merits of a claim, or the applicability of defenses." Presley v. City of Charlottesville, 464 F.3d 480, 483 (4th Cir. 2006).

The Court bears in mind that Rule 8(a)(2) requires only a "short and plain statement of the claim showing that the pleader is entitled to relief." Migdal v. Rowe Price-Fleming Int'l, Inc., 248 F.3d 321, 325-26 (4th Cir. 2001). Although Rule 8's notice-pleading requirements are "not onerous, " the plaintiff must allege facts that support each element of the claim advanced. Bass v. E.I. Dupont de Nemours & Co., 324 F.3d 761, 764-65 (4th Cir. 2003). These facts must be sufficient to "state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).

This requires that the plaintiff do more than "plead[] facts that are merely consistent with a defendant's liability;'" the facts pled must "allow[] the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) ( quoting Twombly, 550 U.S. at 557). The complaint must not only allege but also "show" that the plaintiff is entitled to relief. Id. at 679 (internal quotation marks omitted). "Whe[n] the well-pleaded facts do not permit the court to infer more than the mere possibility of ...


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