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Articles Posted in Business Litigation

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Agreements in restraints of trade are generally void unless they comply with the procedures of § 542.335, Florida Statutes.  The statute requires that any agreement restraining trade, such as a non-compete or non-solicitation agreement, be supported by a “legitimate business interest.”  An agreement restraining trade can only be enforced to the extent that the agreement protects this legitimate business interest.  It is therefore critical that litigants be familiar with what qualifies as a “legitimate business interest.”  The Florida Supreme Court has established that referral sources can qualify as something that can be a protectible legitimate business interest. Peter Mavrick is a Miami non-compete attorney and business litigation attorney who has extensive experience with non-compete litigation.

Florida’s non-compete laws are very pro-employer in comparison to most of the United States. Norman D. Bishara, Fifty Ways to Leave Your Employer: Relative Enforcement of Covenants Not to Compete, Trends, and Implications for Employee Mobility Policy, 13 U. Pa. J. Bus. L.751 (Spring 2011).  Nevertheless, Florida courts will not enforce a non-compete agreement unless it strictly complies with the requirements of Florida statutes.

Under Florida law, generally, “[e]very contract, combination, or conspiracy in restraint of trade or commerce in this state is unlawful.” Fla. Stat. § 542.18.  The exception is found in the express statutory authority found in § 542.335, Florida Statutes.  In pertinent part, § 542.335, Florida Statutes provides:

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Florida’s Deceptive and Unfair Trade Practices Act (“FDUTPA”), § 501.201 et seq, Florida Statutes, allows a person to sue a business for unfair competition and deceptive or unconscionable business practices.  Although the statute allows a consumer to sue a business for violations of FDUTPA, Florida appellate court decisions have also allowed some businesses to sue other businesses under FDUPTA based on consumer harm. This expansion of FDUTPA is important because it allows aggrieved parties to recover more than their damages. FDUTPA allows the Court to enter an injunction or award attorneys’ fees – types of relief that are sometimes unavailable with other causes of action.  Peter Mavrick is a Miami business litigation attorney who has extensive experience with litigating claims under FDUTPA.

FDUTPA states that “[u]nfair methods of competition, unconscionable acts or practices, and unfair or deceptive acts or practices in the conduct of any trade or commerce are hereby declared unlawful.”  Fla. Stat. § 501.204(1). “An unfair practice ‘offends established public policy’ and … is ‘immoral, unethical, oppressive, unscrupulous or substantially injurious to consumers.’” Stewart Agency, Inc. v. Arrigo Enterprises, Inc., 266 So. 3d 207 (Fla. 4th DCA 2019). “[D]eception occurs if there is a ‘representation, omission, or practice that is likely to mislead the consumer acting reasonably in the circumstances, to the consumer’s detriment.’”  PNR, Inc. v. Beacon Prop. Mgmt., Inc., 842 So. 2d 773 (Fla. 2003).  “In any action brought by a person who has suffered a loss as a result of a violation of this part, such person may recover actual damages, plus attorney’s fees and court costs.”  Fla. Stat. § 501.211(2).

Florida’s Fourth District Court of Appeal in Caribbean Cruise Line, Inc. v. Better Bus. Bureau of Palm Beach County, Inc., 169 So. 3d 164 (Fla. 4th DCA 2015), held that FDUPTA is not limited to only consumer-plaintiffs.  In Caribbean, a plaintiff-business sued because the Better Business Bureau (“BBB”) portrayed itself as an unbiased business rating service to the public, but in reality, BBB would improve the score of a business if the business became “accredited” – a process requiring significant payment to BBB.  BBB claimed that the plaintiff could not make a FDUTPA claim because the alleged conduct was directed towards BBB’s customers, not plaintiff’s customers.  The appellate court disagreed, finding that non-consumers could bring a FDUTPA claim as long as consumers were harmed as well, because FDUTPA had been amended to replace the word “consumers” with “persons” in § 501.211, Florida Statutes. The appellate court determined that this statutory wording change meant that FDUTPA claims could be brought by parties that were not consumers of the defendant’s goods or services.

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Florida law can protect companies when their trade secrets are stolen.  For such protections to apply, the confidential information at issue must qualify as a “trade secret” as defined by the Florida Uniform Trade Secrets Act (“FUTSA”).  Fla. Stat. 688.001, et seq.  Generally, something can be a trade secret if derives “independent economic value from not being generally known” and the company makes a reasonable attempt to maintain the secrecy of the information.  Florida case law has helped define what kinds of confidential information qualifies for the statutory requirement of “independent economic value.”  Peter Mavrick is a Fort Lauderdale business litigation attorney and an experienced trade secret attorney.

Trade secrets can exist in many forms.  For example, trade secrets can include confidential business process relating to the production of goods, such as a machine or formula.  Trade secrets can also “relate to the sale of goods or to other operations in the business, such as a code for determining discounts, rebates or other concessions in a price list or catalogue, or a list of specialized customers, or a method of bookkeeping or other office management.”  Summitbridge Nat. Investments LLC v. 1221 Palm Harbor, L.L.C., 67 So. 3d 448, 450 (Fla. 2d DCA 2011).   “Trade secret” is defined by FUTSA as:

Information, including a formula, pattern, compilation, program, device, method, technique, or process that:

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The Florida Arbitration Code provides businesses with flexibility in resolving their conflicts through arbitration. Arbitration is an immensely popular method of conflict resolution for Florida business litigation and employment litigation.  Arbitration can generally help resolve disputes more quickly than litigation.  However, parties to arbitration sometimes need court intervention via “provisional remedies,” i.e., a court ruling providing interim relief to protect one of the parties in a conflict before the entire dispute can be decided by the arbitrator.  Florida Statutes section 682.031(1) specifically contemplates provisional remedies before an arbitrator is appointed.  The purpose of these provisional remedies is to allow judicial intervention when there is a real emergency that cannot be easily addressed in arbitration due to delays sometimes inherent in the arbitration process.  For example, the arbitration process requires consent of all parties to proceed, and there are sometimes delays in getting the process started especially when one of the parties is uncooperative.  An emergency request for a temporary injunction, by its very nature, is exactly the type of matter that § 682.031(1) was designed to protect. Peter Mavrick is a Miami non-compete attorney and employment attorney who has extensive experience representing the interests of businesses and business owners.

The authority for a court’s ability to adjudicate a Motion for an Emergency for Temporary Injunction is found in § 682.031, Florida Statutes, which provides that:

(1) Before an arbitrator is appointed and is authorized and able to act, the court, upon motion of a party to an arbitration proceeding and for good cause shown, may enter an order for provisional remedies to protect the effectiveness of the arbitration proceeding to the same extent and under the same conditions as if the controversy were the subject of a civil action.

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A trademark owner can of course sue the business selling counterfeit copies of the trademark owner’s goods, but it may also sue other businesses that sufficiently provide products or services which the counterfeiter uses.  In Luxottica Group, S.p.A. v. Airport Mini Mall, LLC, 932 F.3d 1303 (2019), the United States Court of Appeals for the Eleventh Circuit recently confirmed that a landlord can be held liable for the trademark infringement of its tenant when the landlord has actual or constructive knowledge of a tenant’s counterfeiting activities.  Peter Mavrick is a Miami business litigation attorney who represents clients in trademark infringement litigation and other unfair competition litigation.

The Lanham Act allows trademark owners to sue businesses that “use in commerce any reproduction, copy, or […] imitation” of a mark when that use is “likely to cause confusion” with the trademark owner’s mark. 15 U.S.C. § 1114(1)(a); Dieter v. B & H Indus. of S.W. Fla., Inc., 880 F.2d 322 (11th Cir.1989).  In such a situation, a trademark owner can recover the profits that the infringer earned and the damages that the owner suffered due to the infringement.  15 U.S.C. § 1117(a).  When the product being sold has a mark that is “identical” or “substantially indistinguishable” from the trademark owner’s mark, it may be considered as a “counterfeit.”  15 U.S.C. § 1127.  The stakes are much higher for sellers of counterfeit products – a counterfeiter will likely be required to pay attorneys’ fees and either treble damages or statutory damages, which could be up to $2,000,000.  15 U.S.C. 1117(b)-(c).  When a business is selling counterfeits, it is not necessary to prove that the violating business was acting in bad faith.  Chanel, Inc. v. Italian Activewear of Florida, Inc., 931 F.2d 1472 (11th Cir. 1991).

A business can also be held liable for the enhanced counterfeiter penalties for supplying goods or services to counterfeiters.  Particularly, a business can be contributing to counterfeiting if it “provid[es] goods or services necessary to the commission of a [counterfeiting], with the intent that the recipient of the goods or services would put the goods or services to use in [counterfeiting].” 15 U.S.C.A. § 1117(b)(2).

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Equitable estoppel is a legal doctrine that essentially prevents one party from taking unfair advantage of another party. Equitable estoppel allows a non-signatory to a contract to compel arbitration of a signatory’s claims against them, if the signatory raised allegations of concerted misconduct by both the non-signatory and one or more of the signatories to the contract. However, this application of equitable estoppel only applies when the signatory alleges substantially interdependent and concerted misconduct by both a non-signatory and one or more of the signatories to the agreement. Peter Mavrick is a Miami business litigation lawyer who represents clients in arbitration proceedings.

In Greene v. Johnson, 2019 WL 3675268 (Fla. 3d DCA 2019) Frederick Greene (“Greene”) and Cameron Grace (“Grace”) incorporated Oak & Cane Co. (“Oak”), which manufactured and sold Oak & Cane American Craft Rum. Greene and Grace also formed Oak & Cane Holdings, LLC (“Holdings”) as a separate entity to own the rum brand’s trademarks and other intellectual property. Jeffrey Johnson (“Johnson”) made two loans to Oak totaling $300,000. Johnson also provided $300,000 to Greene and Grace as an investment in Oak in exchange for seven and a half percent ownership in both Oak and Holdings.

A dispute arose regarding Greene’s business expenses. Johnson sent notices of default to Oak. Subsequently Johnson, Grace, Oak, and Holdings (and other parties) entered into a settlement agreement which gave Johnson full ownership of the assets and intellectual property owned by Oak and Holdings. Greene, however, did not sign this settlement agreement.

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Under the Lanham Act, a defendant may be liable for trademark infringement, if, without consent, he/she uses “in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark” which “is likely to cause confusion or to cause mistake, or to deceive.” 15 U.S.C. § 1114(1). The Act defines a “counterfeit” as a “spurious mark which is identical with, or substantially indistinguishable from, a registered mark.” 15 U.S.C. § 1127. However, the test for whether marks are “substantially indistinguishable” is not well-defined by the applicable case law. Peter Mavrick is a Miami business litigation lawyer who represents clients in trademark infringement and other unfair competition litigation.

In Coach, Inc. v. Chung Mei Wholesale, Inc., 2016 WL 7470001 (S.D. Fla. June 17, 2016), Plaintiffs, Coach, Inc. and Coach Services, Inc.’s (collectively “Coach”), was a luxury consumer goods company that specialized in the design, manufacturing, and sale of, among other things, handbags and wallets. Coach owned a variety of trademarks, which it used in connection with the advertisement and sale of its products. Shen Biao Huang (“Huang”) and his wife, Lian Xiao Fu (“Fu”) operated a business called Chung Mei Wholesale, Inc. (“Chung Mei”) out of a warehouse in Hialeah, Florida. Chung Mei imported goods from China and sold them to retailers and wholesalers. Huang primarily selected merchandise himself, but sometimes his friend, Hung Jain Ke (“Jain Ke”) ordered goods on Huang’s behalf. During the course of their dealings, Huang instructed Jain Ke not to send him any goods that might be counterfeit.

There were two shipments ordered by Jain Ke on behalf of Chung Mei that were seized by the U.S. Customs and Border Protection (“CBP”) seized two shipments imported by Chung Mei from China, which CBP determined contained about 3,000 “Coach Design Handbags,” identified as constituting “counterfeit copies” of the Coach Trademarks. A Coach employee trained to identify counterfeits, examined CBP’s photographs of these bags and concluded the pictured items were counterfeit and bore counterfeit representations of four registered Coach trademarks as well as trade dresses, and were substantially indistinguishable from the Coach trademarks and trade dresses.

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Protection of trade secrets and proprietary information is critical when a business receives a subpoena for its business information and documents. Even when a business is not a party to a lawsuit, it can be compelled to produce sensitive information that can cause irreparable harm. It is often necessary to seek an order of protection and confidentiality from the court. The court, however, must first determine whether the disputed information is in fact a trade secret or proprietary information. Summitbridge Nat’l Invs. LLC v. 1221 Palm Harbor, L.L.C., 67 So.3d 448 (Fla. 2d DCA 2011). Peter Mavrick is an experienced trade secret attorney and business litigation attorney.

In Lake Worth Surgical Center, Inc. v. Gates, 266 So.3d 198 (Fla. 4th DCA 2019), the plaintiff filed a lawsuit against defendants for damages arising from a car accident. The plaintiff treated at Lake Worth Surgical Center, Inc. (“Center”), a non-party, and was billed for the Center’s services. Defendants served the Center with a subpoena that requested billing information that included, among other things, examples of reimbursement rates from unnamed insurers for the Center’s patients. The Center immediately moved for a protective order to prohibit disclosure of confidential financial information. The Center argued that insurance reimbursement rates and the makeup of the center’s patients are trade secret. The trial court denied the Center’s motion for protective and confidentiality order. The Center immediately filed a petition for certiorari review.

The Center contended that the trial court departed from the essential requirements of law by denying the request for a confidentiality of its proprietary and trade secret information. The appellate court granted the petition in part and denied it in part.

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The Lanham Act provides that a successful plaintiff may recover: (1) defendant’s profits, (2) any damages sustained by the plaintiff, and (3) costs of the action. 15 U.S.C. § 1117(a). In exceptional cases, a district court may award attorney fees to the prevailing party. The Lanham Act gives broad discretion to the district court to determine the proper relief due an injured party. See 15 U.S.C. § 1117(a); Burger King v. Weaver, 169 F.3d 1310 (11th Cir.1999).  Peter Mavrick is a Miami business litigation lawyer who represents clients in trademark infringement lawsuits.

In Optimum Technologies, Inc. v. Home Depot U.S.A., Inc., 217 Fed.Appx. 899 (11th Cir. 2007), Optimum Technologies, Inc. (“Optimum”) sued Home Depot, Inc. (“Home Depot”) alleging that Home Depot committed trademark infringement in violation of the Lanham Act, 15 U.S.C. § 1114, and false advertising in violation of 15 U.S.C. § 1125(a). Optimum sold a variety of floor related products, including the Lok–Lift Gripper (“Lok–Lift”). Lok-Lift was applied in strips to the back of rugs and mats to prevent slippage on hard floors and carpets. Optimum owned the Lok–Lift mark. Optimum sold the Lok–Lift product to Home Depot through a joint venture partnership between Optimum and Henkel Consumer Adhesives, Inc. (“Henkle”). Henkle purchased the Lok–Lift product from Optimum then distributed it to Home Depot, among other retailers.

Henkle later developed its own similar product called Hold–It for Rugs (“Hold–It”); however, the Hold–It product was only intended for use on floors, not on carpets. Henkle notified Home Depot that it intended to substitute its Hold–It product in the place of the Lok–Lift product. Henkle sent Home Depot the Hold–It product with the same product number and tracking information as the Lok–Lift product. Home Depot’s computer system did not reflect that the products had changed, so the cash register receipts showed Hold-It purchases to be Lok-Lift purchases. Home Depot also did not update its shelf tags, which still displayed the name Lok–Lift. The Hold–It product that was sold at Home Depot, however, was packaged and marked with the Hold–It name with no reference to Lok–Lift.

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Aggrieved litigants can claim they are victims of a conspiracy – that a group of persons has agreed to perform an unlawful act and damaged them. Such claims can expose multiple parties to liability for the same conduct by allegedly contributing to harm against the plaintiff.  A “conspirator” can be found responsible for a harm that he did not personally cause, as long as he performed an “overt act” in the assistance of others in the “conspiracy.”  Walters v. Blankenship, 931 So.2d 137 (Fla. 5th DCA 2006).  Peter Mavrick has successfully represented clients in Palm Beach, Broward, and Miami-Dade business litigation and related arbitration proceedings.

Florida courts have carved out an exception to the broad reach of conspiracy claims in a legal doctrine called the “intracoporate conspiracy doctrine.”  In general, when a party is involved in a conspiracy only because he was acting on behalf of another, such as when an employee does something for his company, he can evade liability for conspiracy under the intracorporate conspiracy doctrine. The philosophy behind this rule is that when someone is acting entirely on behalf of another, and not on his own behalf, that person is not really “conspiring” with anyone.  After all, a company cannot exist without its agents, i.e., the people employed by the company.

The intracorporate conspiracy doctrine, however, does not shield an alleged conspirator if he has a sufficient personal stake in the conspiracy.   Greenberg v. Mount Sinai Medical Center of Greater Miami, Inc., 629 So. 2d 252 (Fla. 3d DCA 1993).  By contrast, an employee that is simply doing what his boss has directed him to do and is paid a salary for that work is not “conspiring” with his employer.  Courts have also held that the mere fact that an employee would be paid a larger bonus if the conspiracy succeeded is not deemed a sufficient personal stake to form a conspiracy.  HRCC, Ltd. v. Hard Rock Int’l (USA), Inc., 302 F.Supp.3d 1319 (M.D. Fla. 2016).  The law is not clear how much of a “personal stake” must a person have in order for the intracorporate conspiracy to no longer operate as shield against liability for a conspiracy claim.   Florida cases have historically been vague as to the degree of a personal stake that is necessary for a participant to be found to a conspirator.

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