E360INSIGHT, LLC,
Plaintiff,

v.

COMCAST CORPORATION,
Defendant.

COMCAST CORPORATION,
Counterclaimant,

v.

E360INSIGHT, LLC,
Counterdefendant,
DAVID LINHARDT,
MAVERICK DIRECT MARKETING
SOLUTIONS, INC.,
BARGAIN DEPOT ENTERPRISES, LLC,
d/b/a bargaindepot.net and
bargainshoppecorp.com,
NORTHSHORE HOSTING COMPANY, LLC
d/b/a ROCKY MOUNTAIN INTERNET
SERVICES, LLC and BAY CITY HOSTING,
LLC,
RAVINIA HOSTING COMPANY, LLC,
NORTHGATE INTERNET SERVICES, LLC,
and
JOHN DOES 1-50,
Third-Party Defendants.

COMCAST’S MEMORANDUM IN OPPOSITION TO DEFENDANTS’ MOTION TO DISMISS

Counterclaimant, Comcast Corporation (“Comcast”), submits this memorandum in opposition to the Motion to Dismiss filed by Counterdefendant e360insight, and third-party defendants David Linhardt, Maverick Direct Marketing Solutions, Inc., Bargain Depot
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Enterprises, LLC, Northshore Hosting Company, LLC, Ravinia Hosting Company, LLC and Northgate Internet Services, LLC (collectively referred to as “Defendants”).

I. INTRODUCTION

Comcast’s claims address Defendants’ assault on Comcast’s subscribers, their inboxes, Comcast’s network, and the integrity and reliability of its Internet and e-mail services. Comcast’s Counterclaim and Third Party Complaint clearly alleges that Defendants are engaged in a scheme to market their products and services to hundreds of thousands, if not millions, of consumers, through the sending of unsolicited, false, and/or misleading commercial e-mails, or spam. (See, e.g., Comcast’s Compl. ¶¶ 19, 23.) Comcast explicitly pleads that each Defendant participates in the scheme and sends spam on its own behalf as well as on behalf of and in concert with the other Defendants. (See generally Comcast Compl. ¶¶ 23-35.)

Comcast also alleges that, to facilitate their wrongful behavior, Defendants have taken extensive steps to hide their identities and the nature of their business activities and products. (Comcast Compl. ¶¶ 3, 22, 24, 42.) Naturally, since the purpose and result of Defendants’ conduct has been the concealment of their identities and involvement in the spam scheme, certain facts (and much of the evidence) showing the details of Defendants’ wrongful behavior are not presently within Comcast’s knowledge or control.

To distract the Court from Comcast’s well-pleaded allegations, Defendants’ Motion to Dismiss urges incorrect legal standards, and mischaracterizes, ignores, and in some cases merely denies the clear allegations of Comcast’s Complaint.

Defendants are not entitled to dismissal simply by telling the Court that they have not done what Comcast alleges they have done, nor by pointing to the absence of certain magic words or labels in Comcast’s pleading. Comcast’s pleading complies with Rule 8, FED. R. CIV. P., and sufficiently states claims against each Defendant. For these reasons and the reasons discussed herein, Comcast respectfully requests that the Court deny Defendants’ motion.

II. ARGUMENT

When deciding a motion to dismiss under FED. R. CIV. P. 12(b)(6), the court must accept all factual allegations in the complaint as true and draw all reasonable inferences in favor of the plaintiff. Erickson v. Pardus, 551 U.S. __, 127 S. Ct. 2197, 2200 (2007); McMillan v. Collection Professionals Inc., 455 F.3d 754, 758 (7th Cir. 2006). A court may dismiss a claim “only if the complaint fails to set forth ‘enough facts to state a claim to relief that is plausible on its face.’”
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St. John’s United Church of Christ v. City of Chicago, 502 F.3d 616, 625 (7th Cir. 2007) (quoting Bell Atlantic Corp. v. Twombly, 127 S. Ct. 1955, 1974 (2007)).

A. Comcast’s Pleading Complies With FED. R. CIV. P. 8

1. Comcast Need Not Plead Evidence in its Complaint

Ignoring federal pleading requirements, Defendants repeatedly fault Comcast for not presenting “evidence” to support its claims and suggest that failure to do so warrants dismissal. (See, e.g., Defs. Mot. pp. 5, 6, 9, 10.) Specifically, Defendants argue that Comcast: has no “evidence of wrongdoing” by the Third-Party Defendants (Defs. Mot. p. 5); filed its complaint “without any evidence” (Defs. Mot. p. 6), and that it failed to provide “a shred of evidence” to support its claims. (Defs. Mot. p. 9.)

Comcast is not required to plead evidentiary support in its complaint. The Supreme Court has recognized that, in setting forth the short and plain statement required by Rule 8(a), “specific facts are not necessary,” Erickson v. Pardus, 551 U.S. at ___, 127 S. Ct. at 2200, and this Court has stated that “a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations.” Walker v. S.W.I.F.T. SCRL, 491 F. Supp. 2d 781, 788 (N.D. Ill. 2007).

2. “Information and Belief” Allegations Are Proper and Sufficient

Defendants also argue – without support – that Comcast’s Complaint should be dismissed because Comcast has pleaded some of its allegations “on information and belief” (Defs. Mot. pp. 5, 6, 8, 9.) This Court has routinely held that allegations made “on information and belief” satisfy the short, plain statement requirement of Rule 8(a). See, e.g., Mitsubishi Electric Corp. v. IMS Technology Inc., 44 U.S.P.Q.2d 1904, 1912 (N.D. Ill. 1997) (denying defendant’s motion to dismiss on the basis that plaintiff’s allegations were made “on information and belief”). “Information and belief” allegations are particularly justified here. Comcast has alleged that Defendants have intentionally obscured information about their activities, making such information particularly within their knowledge and control. For example, because Defendants send spam from a variety of IP addresses and domain names, registered to a variety of entities (masking the true owner of the IP addresses and domain names in question), Comcast cannot identify with certainty spam originating from Defendants without a list of all IP and domain addresses owned and controlled by Defendants. (See Comcast Compl. ¶ 22.) Defendants should
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not be allowed to complain that Comcast cannot pinpoint details of facts Defendants have made a concerted effort to hide.

3. Comcast’s Claims Do Not Require Pleading With More Particularity

Defendants assert that Comcast’s CAN-SPAM and Illinois Electronic Mail Act (“ILEMA”) claims “sound in fraud” and are therefore subject to the requirements of FED. R. CIV. P. 9(b). (Defs. Mot. pp. 7-9, 10-11.) Like most federal courts, this Court has yet to consider whether claims under CAN-SPAM and the state’s anti-spam laws are subject to heightened pleading requirements. District courts in Washington have considered the issue, however, holding that claims under CAN-SPAM and the analogous Washington anti-spam statute do not “sound in fraud.” Gordon v. Virtumundo, Inc., No. 06-0204-JCC, 2006 WL 3873368, at *3 (W.D. Wash. Dec. 8, 2006); Gordon v. Impulse Mktg Group, Inc., 375 F.Supp.2d 1040, 1048 (E.D. Wash. 2005).1

[1 The Washington Commercial Electronic Mail Act is nearly identical to the ILEMA, prohibiting “the transmission of a commercial electronic mail message…that…contains false or misleading information in the subject line.” RCW § 19.190.020. Likewise, the ILEMA prohibits the sending of “unsolicited electronic mail advertisement if the electronic mail advertisement ...(ii) contains false or misleading information in the subject line.” 815 ILCS 511/10(a)(ii).]

In Virtumundo, the plaintiff claimed that defendants (also online marketing companies) had sent commercial e-mails containing materially misleading subject lines in violation of CANSPAM and Washington’s anti-spam statute.2 Acknowledging that the “materially misleading” subject line allegation could be considered an allegation of a false representation of material fact, the court nevertheless held that neither the claims nor the plaintiff’s factual allegations “sounded in fraud.” 2006 WL 3873368 at *3. The court ruled that plaintiff’s claim did not involve assertions akin to common law fraud, namely that defendants knew the subject lines were misleading, that they had the intent to deceive, nor that plaintiffs took action in reliance on the misrepresentations. Id. Accordingly, the court refused to dismiss plaintiff’s CAN-SPAM and related state claims for failure to plead in accordance with Rule 9(b). Id. Likewise, in Impulse Marketing, the Washington district court held that claims under Washington’s anti-spam statute do not “sound in fraud.” 375 F. Supp. 2d at 1048. As in Virtumundo and Impulse Marketing, Comcast’s claims under CAN-SPAM and the ILEMA, and the facts alleged to support these
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claims, are not “averments of fraud” subject to the heightened pleading requirements of Rule 9(b).

[2 Notably, Virtumundo is one of the companies that Comcast has alleged cooperated with Defendants to exploit the injunction obtained by Defendant e360 against anti-spam website and organization Spamhaus, by default. (Comcast Compl. ¶¶ 46-48.)]

Even if this Court were to construe Comcast’s CAN-SPAM and ILEMA claims as “averments of fraud” subject to Rule 9(b), Comcast has sufficiently pleaded these claims. It is well established that, under Illinois law, the requirements of Rule 9(b) are relaxed when, as here, the plaintiff lacks access to all facts necessary to provide the details of the claim because necessary information is particularly within defendants’ knowledge and control. Corley v. Rosewood Care Ctr., Inc., 142 F.3d 1041, 1051 (7th Cir. 1998); U.S. ex rel. Kennedy et al. v. Aventis Pharmaceuticals, 512 F.Supp.2d 1158, 1167 (N.D. Ill. 2007); Deluxe Media Services, LLC v. Direct Disc Network, Inc., No. 06 C 1666, 2007 WL 707544, at *4 (N.D. Ill. March 2, 2007); Interlease Aviation Investors II (Aloha) LLC v. Vanguard Airlines, Inc., 262 F. Supp. 2d 898, 914 (N.D. Ill. 2003); Trans Union, LLC v. Credit Research Inc., No. 00 C 3885, 2001 WL 648953, at *3 (N.D. Ill. June 4, 2001). This Court has further recognized that a plaintiff is most likely to lack access to specific details when it makes allegations against multiple defendants engaged in a collective scheme. Vanguard, 262 F. Supp. 2d at 914 (“‘[i]t is obvious that a plaintiff may not be privy to the workings of a group of defendants who have acted in concert to defraud him’”). Under the relaxed Rule 9(b) standard, this Court has held “information and belief” pleading can be enough. See Deluxe Media, 2007 WL 707544, at *4; Aventis, 512 F. Supp. 2d at 1167.

Defendants are a group of at least six businesses and an individual engaged in a scheme to send unlawful e-mails. They facilitate their unlawful activities by concealing their identities, the nature of their activities, and the source of their spam. (See Comcast Compl. ¶¶ 3, 22.)3 Thus, specific details about Defendants’ e-mail practices are particularly within Defendants’ knowledge and control, making it impossible for Comcast to allege such details in the Complaint. Although Comcast cannot identify all of the details, Comcast has set forth facts regarding the role of each Defendants in the spam scheme. (See Comcast Compl. ¶¶ 7-14, 20-22.) Comcast has pleaded facts regarding the nature of the Defendants’ e-mails, the intended recipients of the e-mails, and the method by which the Defendants mask their identities and the
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sources of their spam. (See Comcast Compl. ¶¶ 22-29.) Comcast’s Complaint demonstrates that Comcast has reasonable grounds for its suspicion that each Defendant has taken part in the spam scheme and that the spam violates CAN-SPAM and ILEMA, claims that Comcast reasonably anticipates will be brought out by discovery in this case.4

[3 In fact, because Defendants conceal their identities and the nature of their activities, Comcast has pleaded these claims not only against the named Defendants, but also against as yet unidentified parties.

4 Furthermore, Comcast’s Complaint satisfies the broad purpose of Rule 9(b) - to put Defendants on adequate notice of Comcast’s claims so that they may respond to Comcast’s Complaint. Defendants cannot play “hide the ball” and then claim they don’t know where the “ball” is. Rule 9(b) was not designed to encourage such tactics.]

If the Court finds that Comcast’s Complaint is not properly pleaded under the applicable standard, the appropriate remedy would be for the Court to grant Comcast leave to amend its Complaint, not dismissal.

B. Comcast Has Stated Claims Against Each Defendant

1. Comcast Has Adequately Pleaded Claims Against Linhardt

Comcast has alleged that Linhardt personally directs and controls Defendants’ activities (Comcast Compl. ¶ 8), has made misrepresentations to Comcast in furtherance of Defendants’ unlawful activities (Comcast Compl. ¶ 33), and has brought numerous frivolous lawsuits in further pursuit of the Defendants’ illegal scheme (Comcast Compl. ¶¶ 34, 39, 49). He is liable individually for the alleged torts.

The Seventh Circuit has held that where a corporate officer directs and controls the activities of his various companies, makes day-to-day decisions, and furthers an unlawful scheme to defraud consumers, the corporate officer is personally liable for such wrongdoings. FTC v. Bay Area Business Council, Inc., 423 F.2d 627, 636 (7th Cir. 2005) (“[a]s the mastermind behind the entire scheme… there is no question that [the corporate officer] had authority to control the defendant corporations” and was therefore liable for its unlawful activities).

Further, it is well-established that, under Illinois law, a corporate officer is liable for torts committed by his company if he participates in the tortious conduct. ITOFCA, Inc. v. Hellhake, 8 F.3d 1202, 1204 (7th Cir. 1993); Veteran Supply co. v. Swaw, 548 N.E.2d 667, 669-70 (Ill. App. 6th 1989); Nat’l Acceptance Co. v. Pintura Corp., 418 N.E.2d 1114, 1117 (Ill. App. 2d 1981). Although Illinois courts have not specifically considered whether a corporate officer is liable for his company’s CAN-SPAM violations, a Washington District Court recently denied a corporate officer’s motion to dismiss a CAN-SPAM claim against him. Omni Innovations, LLC v. Impulse Marketing Group, Inc., No. C06-1469MJP, 2007 WL 2110337, at *2 (W.D. Wash.
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July 18, 2007). In that case, the plaintiff claimed that the defendant, an officer, director and majority shareholder of his company, was directly liable for the company’s CAN-SPAM violations since he assisted the company in sending the unlawful e-mails. Id. On a motion to dismiss, the court held that because the plaintiff alleged that defendant participated in the sending of the unlawful e-mails, plaintiff had properly pleaded a claim for the officer’s personal liability under CAN-SPAM. Id.

Defendants’ caselaw is inapposite; it posits that a corporate officer enjoys a qualified immunity for the wrongs of his company under contract or torts related to contracts, not claims such as the ones alleged here. (See Defs. Mot. p. 3.) Nor is there any merit to Linhardt’s claims that he is shielded from personal liability because he is an officer of each of the corporate Defendants. Comcast is not seeking to hold Linhardt liable for torts committed by his companies simply because of his officer role. To the contrary, just as the plaintiff in Bay Area Business Counsel, Comcast has alleged that Linhardt is the mastermind of Defendants’ scheme – directing, controlling, and participating the sending of unwanted and unlawful e-mails. Linhardt is therefore personally liable for such activities. See Bay Area, 423 F.2d at 636.

2. Comcast Has Alleged That Each Third-Party Defendant Has Engaged in Unlawful Activities

Comcast has sufficiently pleaded claims against Maverick, Bargain Depot, Northshore Hosting, Ravinia Hosting, and Northgate (the “Third-Party Defendants”). Comcast recognizes (and in fact, has pleaded) that the Third-Party Defendants are each separate businesses. Contrary to Defendants’ assertion, Comcast is not seeking to hold them liable for the actions of any other Defendant, but for their own participation in the spam scheme.

Comcast clearly and explicitly alleges that each Third-Party Defendant has itself engaged in unlawful activities. For example, Comcast alleges as follows: “Maverick…directs and controls the sending of hundreds of thousands, if not millions, of spam e-mails by Defendants” (Comcast Compl. ¶ 19); “Bargain Depot, among other things, provides knock-off, counterfeit or otherwise unauthorized goods marketed through mass e-mails sent by Defendants” (Comcast Compl. ¶ 20); “Northshore Hosting, Ravinia Hosting, Northgate and John Does 1-50 are in the business of registering domain names and IP addresses and sending spam on behalf of Defendants. [They] also register IP and domain name addresses …often with private registry services, for the purposes of masking the true identity of the owners… and the true parties responsible for sending spam.” (Comcast Compl. ¶ 22.)

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3. Comcast Alleges That Third-Party Defendants Are Engaged in More Than “Routine Conveyance”

Defendants’ assertion that Northshore Hosting, Ravinia Hosting and Northgate are immune under CAN-SPAM is baseless. Comcast has clearly alleged that each of them registers domain names and IP addresses in their own name to mask other Defendants’ activities and to themselves send spam. (See Comcast Compl. ¶¶ 22-30.) These activities go far beyond the “routine conveyance” of e-mails that is excluded from liability under CAN-SPAM.5 In addition, the CAN-SPAM Act makes clear that more than one entity can be liable for initiating an e-mail message.6 While each Defendant may have partaken in different parts of the initiation of spam e-mails, each can be held liable for violating CAN-SPAM, exactly as Comcast has alleged here.7 As such, Comcast has adequately pleaded claims against Northshore Hosting, Ravinia Hosting and Northgate.

[5 “Routine conveyance” is defined under the CAN-SPAM Act as “the transmission, routing, relaying, handling, or storing, through an automatic technical process, or an electronic mail message for which another person has identified the recipients or provided the recipient addresses.” 15 U.S.C. § 7702(15).

6 15 U.S.C. § 7702(9) & (12); see also Omni Innovations, 2007 WL 2110337, at *2.

7 Defendants appear to make the silly argument that because Northgate’s corporate name contains the term “Internet Services,” this establishes the scope of its activities and, thus, its immunity from liability. This is yet another instance of Defendants ignoring the clear allegations of Comcast’s complaint, which state that Northgate is involved in far more than “routine conveyance,” regardless of what its corporate name might suggest.]

C. Comcast Has Sufficiently Pleaded The Elements of Each Cause of Action8

[8 While Comcast does not agree with Defendants’ characterization of its unjust enrichment claim, Comcast is willing to withdraw unjust enrichment as a separate cause of action without prejudice. At this juncture, the Court may consider Comcast’s unjust enrichment claim to be a claim for relief on the other substantive causes of action. However, because the facts surrounding Defendants’ conduct are yet to be fully explored in discovery, Comcast requests that the Court allow it to re-allege the claim at a later date should additional relevant facts be discovered.]

Comcast has adequately pleaded its claims for violation of the CAN-SPAM Act, the Illinois Electronic Mail Act (“ILEMA”), trespass to chattels, the Computer Fraud and Abuse Act (“CFAA”), and abuse of process. In the service of their motion, Defendants ignore Comcast’s explicit allegations, and attempt to graft additional elements onto clear statutory causes of action.

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1. Comcast Has Stated Claims Under Section 7704(a)(1) of CAN-SPAM9

[9 Defendants have not challenged Comcast’s claim under Section 7704(a)(2) of CAN-SPAM. Thus, the Court can assume that Defendants’ Motion to Dismiss does not seek dismissal for failure to state a claim under Count II of Comcast’s Complaint.]

Comcast has sufficiently pleaded facts to support its claim under Section 7704(a)(1) of CAN-SPAM. While acknowledging Comcast’s allegation that Defendants’ e-mails contain “misleading or false header or subject line information” (Comcast Compl. ¶ 25), Defendants argue that Comcast has failed to state a claim under Section 7704(a)(1) because “there is no allegation that e360 materially mislead[s]” the recipients of its e-mails. (Defs. Mot. p. 10) (emphasis added).

This court has reiterated that “there are no magic words required to survive a motion to dismiss.” McDorman v. Smith, No. 05 C 0448, 2006 WL 2355574, at *5 (N.D. Ill. Aug. 11, 2006). Even if lacking the supposedly magic word “materially,” a cursory reading of Comcast’s allegations shows that Comcast has sufficiently alleged that Defendants’ e-mails contain “materially false or materially misleading header information” as required by 7704(a)(1). For example, Comcast alleges that Defendants conceal their IP and domain name addresses for purposes of sending spam and that such spam contains misleading and false subject lines. (See Comcast Compl. ¶¶ 24, 25.) Such concealment qualifies as “materially misleading” in violation of Section 7704(a)(1) of CAN-SPAM. See FTC v. Bryant, No. 3:04-CV-897-J-32MMH, 2004 WL 2504357, at *3 (M.D. Fla. Oct. 4, 2004) (“‘materially,’ when used with respect to header information, includes the alteration or concealment of header information in a manner that would impair the ability…to identify, locate, or respond to a person who initiated the electronic mail message…”). Thus, taking the facts alleged as true, Comcast is entitled to relief under CANSPAM and this Court should not dismiss such claims.

2. Comcast Has Stated a Claim for Violation of the ILEMA

The plain language of Section 109(a)(ii) of the ILEMA is clear: a plaintiff must allege that defendant sent (i) an unsolicited e-mail advertisement that (ii) contained false or misleading information in the subject line. 815 ILCS 811/10(a)(ii). Without any support or basis, Defendants read the extra elements of knowledge, intent, and reliance into the ILEMA claim, speculating that “[s]uch language assumes violators will knowingly use false statements to induce recipients to act in reliance on such statements and that the recipients will thus be
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damaged.” (Defs. Mot. pp. 10-11.) Those elements are nowhere to be found in the ILEMA; Defendants have created them from whole cloth.10

[10 Defendants appear to argue that because the ILEMA was codified within the Illinois Consumer
Fraud and Deceptive Business Practices Act (“ICFA”) it is subject to Rule 9(b)’s heightened pleading requirement. (Defs. Mot. p. 11.) This Court has held, however, that the fact that a statutory claim falls under the ICFA does not, in and of itself, make it an “averment of fraud;” the ICFA prohibits not only fraud, but a broad array of unfair practices. See Gaddy v. Galarza Motor Sport L.T.D., No. 00 C 3893, 2000 WL 1364451, *4 (N.D. Ill. Sept. 20, 2000).]

Although this Court has yet to apply the ILEMA, courts in other jurisdictions have applied nearly identical state anti-spam statutes without reading the extra elements of knowledge, intent and reliance into the claims. See, e.g., Virtumundo, Inc., 2006 WL 3873368 at *3; Impulse Mktg Group, Inc., 375 F. Supp. 2d at 1048. Here, Comcast has sufficiently pleaded facts that establish Defendants send unsolicited e-mail advertisements containing misleading subject line information. (See Comcast Compl. ¶¶ 24-29.) Therefore, Comcast has stated its claim under the ILEMA and this Court should deny Defendants’ Motion to Dismiss.

3. Comcast Has Adequately Pleaded a Claim For Trespass to Chattels

A long line of federal court cases, including before this Court, have expressly recognized trespass to chattels as a theory of liability against spammers. Sotelo v. Directrevenue, LLC, 384 F. Supp. 2d 1219, 1230 (N.D. Ill. 2005) (allegation that defendant’s activities overburdened and diminished the functioning of plaintiff’s computer and connection supported a claim for trespass to chattels); see also America Online, Inc. v. IMS, 24 F.Supp.2d 548 (E.D. Va. 1998) (sending spam through AOL’s system constituted trespass to chattels); Hotmail Corp. v. Van$ Money Pie Inc., C-98 JWPVT ENE, 1998 WL 388389 (N.D. Cal. Apr. 16, 1998) (same); America Online, Inc. v. LCGM, Inc., 46 F.Supp.2d 444, 452 (E.D. Va. 1998) (same); America Online, Inc. v. Prime Data Systems, Inc., No. Civ.A. 97-1652-A, 1998 WL 34016692, at *3 (E.D. Va. Nov. 20, 1998) (same); CompuServe, Inc. v. Cyber Promotions, Inc., 962 F. Supp. 1015, 1022 (S.D. Ohio 1997) (sending spam to plaintiff ISP’s customers damaged plaintiff’s system by demanding disk space, draining processing power, and imposing inconvenience and Internet connection costs on plaintiff’s customers).

Like other ISPs that have successfully alleged trespass to chattels claims against spammers, Comcast alleges that Defendants have deprived it and its subscribers of the legitimate use of its network and services by sending millions of spam e-mails through Comcast’s network. (See Comcast Compl. ¶ 23.) The sending of spam through Comcast’s network drains Comcast’s
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resources, degrades Comcast’s network, and interferes with Comcast’s ability to provide services to its subscribers. As set forth in the Complaint, Comcast expends significant resources protecting the integrity of its network by, among other things, filtering out Defendants’ spam. (See Comcast Compl. ¶ 2, 16, 17, 31.)11 In Illinois, this type of alleged harm supports a claim for trespass to chattels. See Sotelo, 384 F. Supp. 2d at 1229.

[11 Notably, Defendants have admitted that their e-mail practices include continually bombarding Comcast’s system by repeatedly attempting to send e-mail messages through Comcast’s network even after Comcast’s Filtering Technology has notified Defendants that their e-mails have been filtered out. (See e360 Compl. ¶ 18-19.)]

Defendants again attempt to distract the Court from the well-pleaded facts of Comcast’s Complaint by using the buzz words “nominal damages” to assert that Comcast’s trespass to chattels claim fails. (Defs. Mot. p. 13.) Despite Defendants’ reliance on Omega World Travel, Inc. v. Mummagraphics, Inc., 469 F.3d 328, 360 (4th Cir. 2006), Illinois courts do not require allegation and proof of actual damages as Defendants assert, and expressly recognize that an ISP’s allegation against spammers that results in interference with the use of the network is enough to plead trepass to chattels.12 Sotelo, 384 F.Supp.2d at1230.

[12 Furthermore, Comcast’s Complaint alleges harm well beyond the harm alleged in Mummagraphics, 469 F.3d at 360. In that case, the Fourth Circuit, applying Oklahoma law, held that plaintiff failed to state a claim for trespass to chattels based on the sending of only eleven e-mails to its computers. Id. The Court held the sending of only eleven e-mails was insufficient to support a claim not only because the plaintiff failed to provide evidence supporting anything more than “nominal damages,” but also because Oklahoma law had not recognized trespass to chattels as a theory of liability against spammers. Id. In contrast, Illinois courts do expressly recognize trespass to chattels in cases like this one, and Comcast has alleged that Defendants send millions of e-mails a day to its subscribers. (See Comcast Compl. ¶ 23, 30.) In any event, Comcast’s allegations are not based solely on the number of spam e-mails sent by Defendants, but also on factors such as the nature of, and the means by which Defendants send spam. (See Comcast Compl. ¶¶ 23-32.)]

4. Comcast’s CFAA Claim is Not Barred By The Statute of Limitations

In its own Complaint, e360 alleged that it sent e-mails (and thereby accessing Comcast’s “protected computers”) as recently as August 23, 2007 and December 11, 2007. (e360 Compl. ¶¶ 15, 18.) Now, Defendants claim that Comcast’s CFAA claim is time-barred by the two year statute of limitations. Comcast alleges that Defendants have been accessing Comcast’s protected computers “since 2005,” with the clear implication that their activities have continued from 2005 to the present. (Comcast Compl. ¶ 31.) Certainly, claims arising from Defendants’ activities in
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2007 are not barred by the two year statute of limitations.13 Moreover, statute of limitations is an affirmative defense, and not properly subject of a motion to dismiss. Doe v. GTE, 347 F.3d 655, 657 (7th Cir. 2003).

[13 The CFAA provides that the statue of limitations begins to run either on the date of the act complained of or upon discovery of the cause of action. 15 U.S.C. § 1030(g). Here, Comcast could not reasonably have discovered that e360 and Defendants were unlawfully accessing Comcast’s protected computers prior to 2006 when Linhardt contacted Comcast. Comcast receives more than 500,000,000 spam e-mails daily and Defendants conceal the source of their spam e-mails. Moreover, despite Defendants’ assertions to the contrary, Comcast has not admitted being “aware” of Defendants’ activities since 2005; Comcast only learned that Defendants have been sending spam to Comcast’s protected computers since 2005 from 360’s January 15, 2008, Complaint.]

5. Comcast Has Properly Alleged Its Abuse of Process Claim Against e360 and Linhardt

Once again, Defendants ignore the well-pleaded allegations of Comcast’s abuse of process claim to mischaracterize the scope of the allegations. Comcast has alleged numerous facts regarding e360 and Linhardt’s actions far beyond merely filing a lawsuit. (Comcast Compl. ¶¶ 36-50, ¶¶ 76-80.) Comcast complains that e360 and Linhardt filed its frivolous lawsuit against Comcast with the ulterior motive of circumventing Comcast’s Filtering Technology, and that they have taken additional steps in furtherance of this motive. For example, e360 moved for a preliminary injunction and expedited discovery regarding stale three-year old claims. e360 then refused Comcast’s offer to evaluate e360’s e-mails, indicating it would use what it learned in discovery to circumvent Comcast’s Filtering Technology. (See Comcast Compl. ¶¶ 35, 76, 77, 78).

It is simply not true that “Comcast’s only allegations relate to the allegedly ulterior purpose e360 had in filing the lawsuit.” (Defs. Mot. p. 15.) Comcast has alleged that e360’s lawsuit is part of e360 and Linhardt’s pattern of filing frivolous lawsuits, using the legal system to intimidate ISPs, anti-spam organizations, and individuals dedicated to fighting spam, all for the purpose of undermining their legitimate and sanctioned anti-spam initiatives. (See Comcast Compl. ¶¶ 49, 50, 79, 80.) Comcast has alleged that e360 marketed or sold the injunction it obtained by default in the e360 v. Spamhaus proceeding in this Court (Comcast Compl. ¶¶ 36- 50); surely selling an injunction entered by this Court to unrelated third parties to enable those parties to circumvent anti-spam measures relied upon by Comcast constitutes abuse of process.

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Taking these allegations as true and drawing all reasonable inferences in Comcast’s favor, Comcast has properly pleaded a claim for abuse of process against e360 and Linhardt.

III. CONCLUSION

For the foregoing reasons, Comcast respectfully asks the Court to deny Defendants’ Motion to Dismiss Comcast’s Counterclaim and Third-Party Complaint. In the alternative, to the extent the Court finds any deficiencies in Comcast’s pleading, Comcast respectfully suggests that any such deficiencies are merely technical, and that it be given leave to replead.

Dated: May 8, 2008

LOEB & LOEB LLP

By:__/s/ Douglas N. Masters_________________
Douglas N. Masters
Sharon A. Ceresnie
Nathan J. Hole
321 North Clark Street, Suite 2300
Chicago, Illinois 60610
[redacted]
Attorneys for Counterclaimant,
Comcast Corporation

There's also a claim about the statute of limitations because Comcast mentioned blocking email as far back as 2005. e360 claims that there is a two year statute of limitations. But, all Comcast has to do in order to avoid that is only continue with email that was sent within the last two years. That shouldn't be hard for them to find and weed out. My guess is, though, that they were only mentioning 2005 as the time period that the fly started buzzing around instead of all of e360's alleged spam being confined to 2005.

====================================
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

E360INSIGHT, LLC,
Plaintiff,

v.

COMCAST CORPORATION,
Defendant.
________________________________________
COMCAST CORPORATION,
Counterclaimant,

v.

E360INSIGHT, LLC,
Counterdefendant,
DAVID LINHARDT,
MAVERICK DIRECT MARKETING
SOLUTIONS, INC.,
BARGAIN DEPOT ENTERPRISES, LLC,
d/b/a bargaindepot.net and
bargainshoppecorp.com,
NORTHSHORE HOSTING COMPANY, LLC d/b/a ROCKY MOUNTAIN INTERNET
SERVICES, LLC and BAY CITY HOSTING,
LLC,
RAVINIA HOSTING COMPANY, LLC,
NORTHGATE INTERNET SERVICES, LLC,
JOHN DOES 1-50,
Third-Party Defendants.

MOTION TO DISMISS

NOW COMES, Plaintiff, e360Insight, LLC (“e360”) and Third-Party Defendants David Linhardt (“Mr. Linhardt”), Maverick Direct Marketing Solutions, Inc. (“Maverick”), Bargain Depot Enterprises, LLC (“BDE”), Northshore Hosting Company, LLC (“Northshore”), Ravinia
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Hosting Company, LLC (“Ravinia”) and Northgate Internet Services, LLC (“Northgate”) (collectively “Defendants”) and by and through its attorneys, Carla E. Buterman of the Law Office of Carla E. Buterman and Bartly J. Loethen of Synergy Law Group, LLC, and for their Motion to Dismiss pursuant to Fed. R. Civ. P. 12(b)(6), state as follows:

A. Introduction.

Counter-Plaintiff, Comcast Corporation (“Comcast”), has filed a seven count counterclaim alleging causes of action based on multiple violations of 15 U.S.C. § 7704 et. seq., CAN-SPAM (Counts I and II), Violation of Illinois Electronic Mail Act, 815 ILCS 511/10 (Count III), Violation of the Computer Fraud and Abuse Act, 18 U.S.C. § 1030(a)(5) (Count IV), Trespass to Chattels (Count V), Unjust Enrichment (Count VI) and Abuse of Process (Count VII).

The Counterclaim should be dismissed against Mr. Linhardt because it does not adequately identify the acts of Mr. Linhardt that give rise to finding personal liability for his actions as an officer or agent of the other Third-Party Defendants.

Counts I and II are premised on allegations that Defendants sent e-mail that contained false and misleading information about the origin of the e-mail, the author of the e-mail, and the IP address of the sender of the e-mail (Count I) and sent e-mails that contained subject headings that mislead the recipient (Count II). These Counts should be dismissed for failure to comply with Fed. R. Civ. P 9(b) which requires that “all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with particularity.” These Counts should also be dismissed for failure to state a claim upon which relief can be granted.

Count III, under the Illinois Electronic Mail Act, should be dismissed because for failure to comply with Fed. R. Civ. P. Rule 9(b) for the same reasons as Counts I and II should be
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dismissed. Also, Count III should be dismissed for failure to state a claim upon which relief can be granted.

Count IV should be dismissed because it is barred by the applicable statute of limitation proscribed by 18 U.S.C. § 1030(g) which requires any action brought under the act to be commenced within two (2) years of the date of the complained of act.

Count VI should be dismissed because Comcast has not adequately pled a cause of action for unjust enrichment. Comcast must allege that it is entitled to any monies earned by Defendants. Comcast’s failure to plead such facts renders Count VI fatally flawed.

To prevail on a claim of trespass to chattels, Counter-Plaintiff must allege and prove actual damages. Count V should be dismissed because Counter-Plaintiff cannot claim any actual damages arising from the alleged transmission of the e-mails at issue.

Count VII of the Counterclaim should be dismissed because the mere filing of a lawsuit, even with malicious intent is not a sufficient basis for the filing of a claim for abuse of process. Rather, Comcast would need to allege some actual misuse of the judicial process to state a claim for abuse of process.

B. Mr. Linhardt Should Be Dismissed Because He Is Not Liable For The Acts Of The Companies.

Under Illinois law, “corporate officers and directors are afforded a qualified privilege to use their business judgment and discretion on behalf of the corporation.” United Labs., Inc. v. Savaiano, 2007 U.S. Dist. LEXIS 94034 *9 (N.D. Ill 2007); see also National Acceptance Co. of America v. Pintura Corp., 94 Ill. App. 3d 703, 706, 418 N.E.2d 1114, 50 Ill. Dec. 120 (Ill App. 2nd 1981) (corporate officers are generally not liable for the corporation’s torts). In cases, like this, where the director is acting “to further the corporation’s interest rather than his own” he is not liable. Pikes v. Riddle, 38 F. Supp. 2d 639, 640, 1998 U.S. Dist. LEXIS 12665, *3 (N.D. Ill.
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1998). To overcome the qualified privilege, Plaintiff bears the burden of alleging and proving “that the officer's conduct was unjustified or malicious, and therefore outside the scope of the privilege.” United Labs., Inc. v. Savaian, at *9; see also, Mittelman v. Witous, 135 Ill. 2d 220, 249, 552 N.E.2d 973, 987 (Ill. 1989) (corporate officers are not personally liable for the acts of the companies absent a showing that their actions as a corporate officer were done “without justification or maliciously.”) (disapproved on other grounds). Here, there are no allegations that Mr. Linhardt was acting in his own interests or that he acted without justification or maliciously. Mr. Linhardt is not personally liable for the actions of the Third-Party Defendant companies and he should be dismissed with prejudice from this litigation.

Mr. Linhardt recognizes that corporate officers are liable for fraudulent acts of the companies if they participated in the fraud. Allabastro v. Cummins, 90 Ill. App. 3d 394, 398, 413 N.E.2d 86, 45 Ill. Dec. 753 (Ill App. 1st 1980). The elements of common law fraud are: “(1) a false statement of material fact; (2) defendant's knowledge that the statement was false; (3) defendant's intent that the statement induce the plaintiff act; (4) plaintiff's reliance upon the truth of the statement; and (5) plaintiff's damages resulting from reliance on the statement.” Connick v. Suzuki Motor Co., 174 Ill. 2d 482, 496, 675 N.E.2d 584, 591 (Ill. 1996).

Here, Comcast has alleged none of the elements to support a fraud claim. While Comcast does make general accusations against Mr. Linhardt (ECF Doc. No. 28-2 at ¶¶ 33-34), the allegedly fraudulent statements made by Mr. Linhardt are not material to any of the causes of action alleged in the Counterclaim. Moreover, Comcast does not allege any reliance on the allegedly fraudulent statements nor does it claim any damages as a result of the allegedly fraudulent statements.

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Mr. Linhardt should be dismissed from the Counterclaim because the only acts alleged to have been undertaken by him were done within the scope of his employment as an officer of the company and any allegedly fraudulent statements made by Mr. Linhardt were not material to the causes of action asserted by Comcast.

C. All Third-Party Corporate Defendants should be Dismissed from this Action.

All third-party corporate defendants should be dismissed from this action. As with most of Comcast’s allegations in this Complaint, Comcast has asserted allegations only on “information and belief” regarding these entities and has done so only off of belief that such entities are in some way affiliated with e360. However, simply being a corporation that is affiliated or does business with e360 is insufficient to allow Comcast to maintain such frivolous accusations against these entities without any evidence of wrongdoing.

Each of these corporations are separate, individual corporations with separate business models and separate business functions. As such, they cannot be liable for the acts for other separate entities, even affiliated ones. A corporation is a separate and distinct legal entity from its corporate affiliates. Three Way Drywall, Inc. v. Spoons Restaurant, Inc., 1987 U.S. Dist. LEXIS 2014, 1987 WL 8158 (N.D.Ill. 1987) (citing Main Bank of Chicago v. Baker, 86 Ill. 2d 188, 204, 427 N.E.2d 94, 101, 56 Ill. Dec. 14 (1981)). Thus, unless Comcast can show some action or wrongdoing in regards to each corporation beyond its “information and belief” pleading, all corporate defendants should be dismissed.

For example, Comcast merely alleges that Northgate is an affiliate of e360. Para. 13. Comcast makes no other allegations against Northgate. In fact, Northgate, as its name states, is an internet services provider that provides provide a full range of Internet services, including web hosting, bandwidth, co-location services, systems administration, application support and development, and IT consulting services. This has nothing more to do with sending of emails
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than Comcast has to do with the sending of emails by entities. This is essentially what Comcast has alleged with regards to all third-party corporate defendants and as such all should be dismissed.

D. Northshore Hosting, Ravinia Hosting And Northgate Are Not Liable Under CAN-SPAM.

The third-party complaint alleges that Northshore Hosting, Ravinia Hosting, and Northgate are engaged in activities that make them Internet Service Providers. (ECF Doc. No. 28-2 at ¶ 22). The definitions of CAN-SPAM make clear that an Internet Service Provider enganged in the “routine conveyance” of allegedly offending e-mails is not deemed to have “initiated” the allegedly offending e-mail. see 15 U.S.C.S. § 7702 (9). Given that Northshore Hosting, Ravinia Hosting, and Northgate are internet service providers and there only involvement with the allegedly offending e-mails would have been the “routine conveyance”, the claims based on alleged violations of CAN-SPAM fail and must be dismissed with prejudice.

E. Comcast’s Allegations Under CAN-SPAM Fail as a Matter of Law.

Comcast’s counterclaim and third-party complaints are nothing more than a fishing expedition and should be dismissed. A party may not indulge in a fishing expedition or file a complaint on a rumor or a hunch. Bankers Trust Co. v. Old Republic Ins. Co., 959 F.2d 677, 684 (7th Cir. 1992). This is exactly what Comcast has done. Comcast has filed complaints based on nothing more than suspicions and accusations without any evidence. This is clearly shown when the factual allegations are examined. Nearly fifty percent (50%) on the factual allegations alleged are upon “information and belief.”1

[1 Additionally, many of Comcast’s allegations stated within specific Counts are alleged on “information and belief.”]

Courts generally disfavor pleadings on “information and belief” because of Rule 11’s requirement that counsel make a reasonable inquiry before filing a complaint. Trans Union, LLC
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v. Credit Research Inc. et al., 2001 U.S. Dist. LEXIS 7559 (N.D.Ill.) (J. Moran). Here, it appears that Comcast and its counsel have failed to make any attempt to support their frivolous allegations but rather pray that they will be allowed to fish for evidence long after the case has been filed in an effort to support their claims. Nor has Comcast provided any grounds for their suspicions. Rather, Comcast relies on mere speculation in their complaints. Such actions walk the line of Rule 11 and should not be tolerated.

Additionally, as Comcast’s CAN-SPAM allegations sound in fraud they are required to be pled under the heightened pleadings requirement of Rule 9(b). Rule 9(b) applies to “averments of fraud,” not claims of fraud, so whether the rule applies will depend on the plaintiff’s factual allegations. Borsellino, et al. v. Goldman Sachs Group, Inc., 477 F. 3d 502 (7th Cir. 2007). A claim that “sounds in fraud” – in other words, one that is premised upon a course of fraudulent conduct – can implicate Rule 9(b)’s heightened pleading requirements. Id. Both of Comcast’s Counts under CAN-SPAM sound in fraud and should be held to Rule 9(b)’s heightened requirements.

Count I of Comcast’s Complaint is brought under 15 U.S.C. § 7704(a)(1), which states:

ß 7704. Other protections for users of commercial electronic mail

(a) Requirements for transmission of messages.

(1) Prohibition of false or misleading transmission information. It is unlawful for any person to initiate the transmission, to a protected computer, of a commercial electronic mail message, or a transactional or relationship message, that contains, or is accompanied by, header information that is materially false or materially misleading. For purposes of this paragraph--

(A) header information that is technically accurate but includes an originating electronic mail address, domain name, or Internet Protocol address the access to which for purposes of initiating the message was obtained by means of false or fraudulent pretenses or representations shall be considered materially misleading; (emphasis added).

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This language as well as Comcast’s factual allegations based on this language clearly sound in fraud as they require a violator of the statute to engage in fraudulent conduct designed to mislead or to obtain information through false or fraudulent pretenses. Hence, Comcast’s allegations based on “information and belief,” notably paragraph 25, must be plead under Rule 9(b).2

[2 Similarly, Comcast failed to plead any factual allegations in support of its claims under Paragraph 53 that accuses e360 of “regularly send[ing] messages that include originating e-mail address, domain names, and IP addresses that were obtained by means of false of fraudulent pretenses or representations that are materially misleading.” This Court need not accept blanket conclusory allegations stated without a shred of supporting evidence.]

Similarly, Comcast’s Count II is brought under CAN-SPAM, 15 U.S.C. § 7704(a)(2), which states:

(a) Requirements for transmission of messages.

(2) Prohibition of deceptive subject headings. It is unlawful for any person to initiate the transmission to a protected computer of a commercial electronic mail message if such person has actual knowledge, or knowledge fairly implied on the basis of objective circumstances, that a subject heading of the message would be likely to mislead a recipient, acting reasonably under the circumstances, about a material fact regarding the contents or subject matter of the message (consistent with the criteria used in enforcement of section 5 of the Federal Trade Commission Act (15 U.S.C. 45)). (emphasis added).

This language as well as Comcast’s factual allegations based on this language clearly sound in fraud as it requires a violator to have actual knowledge that the email they are sending will likely mislead its recipient. Hence, Comcast’s allegations must be pled under Rule 9(b). Comcast’s allegations, notably paragraph 26, is pled on “information and belief” and is insufficient under Rule 9(b).

While factual fraudulent allegations proffered on “information and belief” are not improper per se, they will only comport with Rule 9(b) if they are accompanied by an
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explanation as to why the facts are unavailable and a statement of the grounds for believing the existence of those facts. See, Bankers Trust Co. v. Old Republic Ins. Co., 959 F.2d 677, 684 (7th Cir. 1992). Here, Comcast has failed to state why they have pled on “information and belief”, why the facts alleged are unavailable or what grounds they have for believing their allegations to be true. Indeed, Comcast would have a hard time stating why they don’t have information related to their allegations or why the facts are unavailable to them considering Comcast claims both in its Motion to Dismiss and here that they filter emails based on content and have sophisticated means on identifying what is in emails so that they can block spam. If Comcast is so sure of the reasons they have blocked e360’s emails to its customers then why do they need to plead on “information and belief.” Why can’t Comcast provide the Court and Defendants with at least one email or shred of evidence to support their absurd claims?

Fed. R. Civ. P. Rule 9(b) imposes more stringent pleading requirements upon complaints charging fraud than on complaints charging other types of misconduct. Fed. R. Civ. P. 9(b). In DiLeo v. Ernst & Young, the Seventh Circuit held that plaintiffs must plead the circumstances constituting fraud in detail -- the "who, what, when, where, and how. .. ." DiLeo v. Ernst & Young, 901 F.2d 624, 626 (7th Cir.), cert. denied, 498 U.S. 941, 111 S. Ct. 347, 112 L. Ed. 2d 312 (1990). Comcast’s pleadings are essentially devoid of any detail. Thus, Comcast’s pleadings are insufficient as a matter of law and should be dismissed.

F. Comcast’s Allegations Under CAN-SPAM Fail to State A Claim Upon Which Relief Can be Granted.

In Count I, Comcast alleges that Defendants violated CAN-SPAM’s requirements concerning the accuracy of header information. The Act provides “it is unlawful for any person to initiate the transmission, to a protected computer, of a commercial electronic mail message…that contains, or is accompanied by, header information that is materially false or
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materially misleading.” 15 U.S.C. 7740 (a)(1). Thus, Comcast must allege that Defendants have initiated and/or transmitted email messages to a protected computer with materially false or misleading header information.
Comcast has failed to so allege. Comcast’s allegations state only that “on information and belief, some of Defendant’s commercial emails contain misleading or false header or subject line information.” D. Comp. ¶ 25. There is no allegation that e360 materially mislead or used fraudulent means as required. Simple inaccuracies, if any existed at all, (which e360 denies) are insufficient to meet the CAN-SPAM. Omega World Travel, Inc. v. Mummagraphics, Inc, 469 F.3d 348, 357 (4th Cir. 2006). Comcast’s failure to allege or attach even a single email to its Counterclaim and Compliant showing anything false or materially misleading regarding e360’s emails is indicative that this is nothing more than a fishing expedition.

Similarly, Comcast’s allegations that e360 has sent “hundreds or thousands, if not millions, of email messages” in violation of the Act while failing to provide even one single email showing a violation further shows that Comcast’s Counterclaim and Complaint is a fishing expedition meant only to intimidate and harass.

G. Comcast Fails to Properly Plead its Claim for Violation of the Illinois Electronic Mail Act and Fails to State A Claim Upon which Relief May be Granted.

Just as the CAN-SPAM Act is subject to Rule 9(b) pleading requirements so too should the Illinois Electronic Mail Act (hereafter “Illinois Act”), 815 ILCS 511/10. Under the Illinois Act, “No individual or entity may initiate or cause to be initiated an unsolicited electronic mail advertisement if the electronic mail advertisement…contains false or misleading information in the subject line.” 815 ILCS 511/10. Such language assumes violators will use knowingly false statements to induce recipients to act in reliance on such statements and that the recipients will
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thus be damaged. These are the exact requirements for Illinois common law fraud.3 Similarly, under 815 ILCS 511/15, the Illinois Legislature contemplated that a “violation of this Act constitutes an unlawful practice under the Consumer Fraud and Deceptive Business Practices Act.” Thus, Comcast’s allegations must be pled under Rule 9(b).
Comcast’s allegations are insufficient as a matter of law under Rule 9(b). Comcast pleadings are, as mentioned above, on “information and belief” without the proper statements as to why Comcast doesn’t have the information necessary to properly plead. This is especially troubling because Comcast throughout its own Motion to Dismiss claimed thorough knowledge of e360’s emails and their contents. Comcast’s Complaint of nearly fifty percent “on information and belief” pleading is nothing more than a fishing expedition and should be dismissed.
Comcast also failed to state a claim upon which relief can be granted. Comcast is required to plead that e360 has sent or attempted to send unsolicited electronic mail advertisements that contain false or misleading information in the subject line. Comcast is also to plead that consumers relied on such statements to their detriment. Here, Comcast has pled “on information and belief” that “some of [e360’s] commercial emails contain misleading or false header or subject line information.” Para. 25 And that “on information and belief, not all of the intended recipients of [e360’s] commercial emails have opted in to receive such email messages.” Para. 28. So Comcast essentially pleads that “on information and belief” some of e360’s emails have been sent to consumers who didn’t want to receive them and some may have “on information and belief” contained false statements. Another way to view Comcast’s allegations is that e360 “on information and belief” sent emails with perfectly correct statements
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in the subject line to consumers who requested to receive them. Of course, since everything is on “information and belief” and Comcast offers nothing but conjecture it is hard to determine what is actually being plead.
Similarly, Comcast failed to plead that anyone relied on any statement made by e360 to its detriment. In fact, under Comcast’s statements no consumers have received e360’s commercial emails because Comcast has been blocking them since 2005. Para. 31. Comcast’s pleadings fail as a matter of law without such pleading. Comcast’s failure to state a claim upon which relief can be granted is grounds for dismissal of Count III.

[3 In Illinois, the elements of common law fraud are: (1) a false statement of material fact; (2) defendant's knowledge or belief that the statement was false; (3) defendant's intent to induce plaintiff to act; (4) plaintiff's reliance on the truth of the statement; and (5) plaintiff's damages resulting from that reliance. Board of Educ. v. A, C & S, Inc., 131 Ill. 2d 428, 546 N.E.2d 580, 591, 137 Ill. Dec. 635 (Ill. 1989).]

H. Count IV Should Be Dismissed As Barred By The Applicable Statute Of Limitations.

Count IV of the Counterclaims attempts to state a cause of action based on the violation of 18 U.S.C. § 1030. Comcast alleges: “Comcast’s Filtering Technology has filtered out Defendant’s spam since as early as 2005.” (ECF Doc. No. 28-2 at ¶ 31). Comcast does not allege any subsequent wrongful acts.

§ 1030(g) states that “No action may be brought under this subsection unless such action is begun within 2 years of the date of the act complained of or the date of the discovery of the damage.” By Comcast’s own admission, it was aware of the allegedly harmful acts of Defendants as early as 2005. However, Comcast did not institute its claim based on alleged violations of 18 U.S.C. § 1030 until March 18, 2008.

Comcast’s claim based on 18 U.S.C. § 1030 is barred by the statute of limitation imposed by § 1030(g) and should be dismissed with prejudice.

I. Count V Should Be Dismissed For Failure To State A Cause Of Action.

To prevail on a claim for Trespass to Chattels, Counter-Plaintiff must allege and prove actual damages. Omega World Travel, Inc. v. Mummagraphics, Inc., 469 F.3d 348, 359 (4th Cir.
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2006). Nominal damages are insufficient to prevail on a claim for Trespass to Chattels. Id. see also Intel Corp. v. Hamidi, 30 Cal. 4th 1342, 1 Cal. Rptr. 3d 32, 71 P. 3d 296, 302 (Cal. 2003) (quoting Restatement (Second) of Torts § 218 cmt. e (1965)). Counter-Plaintiff’s Counterclaim makes clear that it suffered, at most, nominal damages and therefore Count V should be dismissed with prejudice.

Counter-Plaintiff alleges that it “filters about 500,000,000 spam e-mails per day”. (ECF Doc. No. 28-2 at ¶ 2). Counter-Plaintiff further alleges that Defendants “have attempted to send hundreds of thousands, if not millions, of spam e-mails to Comcast’s subscribers since as early as 2005 …” Id at ¶ 30. Even assuming that Defendants sent 2,000,000 e-mail to Comcast’s subscribers, and assuming that all of the e-mail were sent on the same day, that would only account for .4% of all of the allegedly spam e-mail Comcast claims to receive on a given day. Accepting Comcast’s allegations as true demonstrates that the allegedly offending e-mails Comcast claims were sent by Defendants represent nothing more a nominal incursion and are therefore not actionable.

J. Count VI Should Be Dismissed For Failure To State A Cause Of Action.

Count VI of Comcast’s Counterclaim is based on the theory of unjust enrichment. In cases such as this, where the alleged unjust benefit flowed from a third-party, Comcast must allege “the benefit should have been given to [Comcast], but the third party mistakenly gave it to the defendant instead; (2) the defendant procured the benefit through the third party through some type of wrongful conduct; or (3) the plaintiff for some other reason had a better claim to the benefit than the defendant." HPI Health Care Serv., Inc. v. Mt. Vernon Hosp., Inc., 131 Ill.2d 145, 160, 545 N.E.2d 672, 137 Ill. Dec. 19 (IL 1989).

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First, Comcast has failed to state a cause of action because it does not state what wrongful conduct, and by which parties, resulted in the acquisition of a benefit to which the Defendants are not entitled.

Assuming arguendo that Comcast did sufficiently identify the wrong, the claim still fails because a “defendant's ‘wrongful conduct’ alone will not support a claim for unjust enrichment under the second method if [Comcast] has no ‘claim' or ‘entitlement’ to the monies.” Sotelo v. DirectRevenue, LLC, 384 F. Supp. 2d 1219, 1234, 2005 U.S. Dist. LEXIS 18877, *40 (N.D. IL 2005) See McCabe v. Crawford & Co., 210 F.R.D. 631, 642-43 (N.D. Ill. 2002) (dismissing unjust enrichment claim because plaintiff did not allege that he paid any money to defendants). Here, Comcast does not make, and cannot make, a claim on any monies allegedly earned by Defendants through the allegedly harmful act of sending commercial e-mails to Comcast’s customers. For this reason, Comcast has failed to state a claim for unjust enrichment and this Count VI should be dismissed with prejudice.

K. Count VII Should Be Dismissed Because The Mere Filing Of A Lawsuit Is Not Sufficient To Allege Abuse Of Process.

In order to state a cause of action for abuse of process, Comcast must allege “that defendants had an ulterior purpose for filing a lawsuit and that they acted in a way that was not proper in the regular prosecution of the suit.” Bonney v. King, 201 Ill. 47, 50-51, 66 N.E. 377, 378 (Ill. 1903). To satisfy the second element, the party asserting the cause of action “must allege that ‘process has been used to accomplish some result which is beyond the purview of the process or which compels the party against whom it is used to do some collateral thing which could not legally be compelled to do.’” Baldwin Piano, Inc. v. Deutsche Wurlitzer GMBH, 2003 U.S. Dist. LEXIS 13425 *9 (N.D. Ill. 2003) (reversed on other grounds) quoting Doyle v. Shlensky, 120 Ill. App. 3d 807, 458 N.E.2d 1120, 1128, 76 Ill. Dec. 466 (Ill. App. Ct. 1983).

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“Illinois law unequivocally requires acts beyond the mere filing of a complaint to create a cause of action for abuse of process.” Marchese v. Dobry, 2001 U.S. Dist. LEXIS 5985 *5 (N.D. Ill. 2001) (emphasis added). Thus, the “mere institution of a legal proceeding, even without foundation and merely intended to harass the defendant, does not constitute abuse of process.” Wabash Publishing Co. v. Flanagan, 1990 U.S. Dist. LEXIS 2102, 1990 WL 19977, *5 (N.D. Ill. 1990) see also Installation Servs. v. Elecs. Research, Inc., 2005 U.S. Dist. LEXIS 29832 *21 (N.D. Ill. 2005) (The mere filing of a lawsuit [] is not enough to sustain a claim for abuse of process). An abuse of process claim “lies in the improper use of the legal process after it has been issued.” Wade v. Am. Airlines, Inc., 2003 U.S. Dist. LEXIS 15300 *7 (N.D. Ill. 2003). (emphasis in original). Finally, “Illinois courts have generally taken a very restrictive view of the tort of abuse of process [and] the word "process" has been given its literal meaning. Commerce Bank, N.A. v. Plotkin, 255 Ill. App. 3d 870, 872, 627 N.E.2d 746, 748 (Ill. App. 3rd 1994). See also Doyle v. Shlensky 120 Ill. App. 3d 807, 816, 458 N.E.2d 1120, 1128, 76 Ill. Dec. 466 (Ill App. 1st1983), ("Process is issued by the court, under its official seal and must be distinguished from pleadings, which are created and filed by the litigants").

Comcast’s Counterclaim is void of any allegation that e360 has misused the legal process. Comcast’s only allegations relate to the allegedly ulterior purpose e360 had in filing the lawsuit. Nowhere does Comcast allege that e360 has done some act not proper in the regular prosecution of the suit.

Count VII of Comcast’s Counterclaim should be dismissed with prejudice because Comcast has not and cannot allege an improper act in the prosecution of its lawsuit against Comcast.

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WHEREFORE, Counter Defendant and Third-Party Defendants respectfully request that this Court enter an Order dismissing David Linhardt from this action and dismissing all Counts with prejudice and any other relief this Court deems just.

Respectfully submitted,
Counter-Defendants and Third-Party Defendants

By: /s/ Bartly J. Loethen
One of their Attorneys

Bartly J. Loethen (6225484)
Synergy Law Group, L.L.C.
730 West Randolph, 6th Floor
Chicago, Illinois 60661
Telephone: (312) 454-0015
Facsimile: (312) 454-0261

Carla E. Buterman (6281101)
Law Office of Carla E. Buterman
555 Skokie Blvd., Ste 500
Northbrook, IL 60062
Telephone: (847) 480-1020
Facsimile: (847) 480-5879