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SYNYGY, INC. v. SCOTT-LEVIN

June 4, 1999

SYNYGY, INC., PLAINTIFF,
v.
SCOTT-LEVIN, INC. AND LEONARD VICCIARDO, DEFENDANTS.



The opinion of the court was delivered by: Anita B. Brody, District Judge.

  MEMORANDUM

Plaintiff Synygy, Inc., formerly known as Simulate, Inc., is a corporation that provides software to pharmaceutical companies. Defendant Scott-Levin, Inc. ("Scott-Levin") is a corporation that sells data products and software to pharmaceutical companies. Defendant Leonard Vicciardo ("Vicciardo") is the Vice-President of Scott-Levin. Plaintiff brings this action against defendants under section 43(a) of the Lanham Act, 15 U.S.C.A. § 1125(a), with pendent state law claims for commercial disparagement and defamation. As to each count plaintiff requests injunctive relief and damages. Before me is defendants' motion for summary judgment in which they argue that each of plaintiffs claims fail as a matter of law. I will grant defendants' motion on all claims.

Plaintiff originally based its claims on a slide shown by Vicciardo at a client conference and three oral statements uttered by Vicciardo contemporaneously with the showing of the slide. The three statements were that: (1) plaintiff deceives its customers by selling them services and software that do not do what plaintiff says they do; (2) plaintiff lies to its customers; and (3) plaintiff does not have the expertise required to perform its work. Complaint at ¶¶ 18, 26, 34. Plaintiff has offered no evidence that Vicciardo ever made these alleged oral statements and has chosen to abandon those particular claims by not addressing them in its response to defendants' summary judgment motion.

Through discovery, however, plaintiff has apparently uncovered other oral statements allegedly made in 1996 by defendants to one of plaintiff's customers. Thus, I construe plaintiff's legal claims to be based on these new statements, and on the slide shown at the client conference in August of 1997.

I. Background

The following account of the facts is derived from the record before me and is construed in the light most favorable to the nonmoving party, in this case, the plaintiff. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).

Plaintiff sold a software product known as Information Production and Distribution Systems ("IPDS") to the pharmaceutical industry. Plaintiff's response brief ("Pl.Resp.") at 3. The software is designed to enable the user to integrate data from different sources, such as data provided by Scott-Levin. Id. In 1995, plaintiff entered into a contract with Bristol Meyers Squibb, Inc. ("BMS"), a pharmaceutical company, whereby plaintiff would provide IPDS to BMS. BMS requested that plaintiff use a portion of defendant Scott-Levin's data along with plaintiff's software. So that plaintiff could use the Scott-Levin data, Scott-Levin agreed to prepare unencrypted data files, known as "flat files." Although the parties dispute the extent of the work required by Scott-Levin to ready the files for plaintiff, defendants claim to have been soured to plaintiff by the experience.

The gravamen of plaintiff's claim is that defendants maligned plaintiff causing plaintiff damage. Plaintiff's claims are based on three incidents or communications: two oral statements and one slide shown as part of a presentation. The two oral statements were (a) an oral statement allegedly made by Vicciardo in 1996; and (b) an oral statement allegedly made by Patrick Duffy, a Scott-Levin employee, in 1996. The slide was shown at a slide presentation delivered by Vicciardo at a Scott-Levin client conference in 1997. Pl. Resp. at 4, 10-11. I will discuss each incident in turn.

1. Oral Statements

Plaintiff claims that defendants made oral statements to a common customer of both plaintiff and defendants, and that these statements caused plaintiff business harm. The statements were allegedly made in the fall of 1996 by Vicciardo, and Scott-Levin's client support representative, Patrick Duffy, to Zeneca Pharmaceutical, Inc. ("Zeneca"). Zeneca was a common customer of both plaintiff and defendant. Plaintiff avers that Vicciardo and Duffy told Zeneca about the problems Scott-Levin encountered with plaintiff during the BMS project, and that this caused Zeneca to sever its business relationship with plaintiff. Pl. Resp. at 4-5.

Plaintiff offers as evidence of these alleged statements two electronic mail transmissions ("e-mails"). The first e-mail is offered to prove that both Vicciardo and Duffy made defamatory statements. The second e-mail goes only to Duffy's alleged statements.

The first e-mail is from Jeff Magill, Vice President of plaintiff, to three other employees of plaintiff. Beck Decl. At Exhibit F. In this e-mail, Magill tells his three colleagues:

  "When [Mary Jo Newtown of Zeneca] spoke with
  [Vicciardo] earlier in the week, he said non-specific
  but troubling things about Simulate, causing Mary Jo
  to question Simulate's value to Zeneca (Pat Duffy, on
  the other hand, had specific, troubling things to say
  about us)." Beck Decl. at Exhibit F.

This is the only evidence plaintiff produced to support its claim that Vicciardo made defamatory statements about plaintiff to Zeneca.

The second e-mail that plaintiff submits as evidence is offered to prove that Duffy made defamatory statements about plaintiff to Zeneca. The e-mail was sent by Duffy to Vicciardo.*fn1 In the e-mail, Duffy relates to Vicciardo a conversation he had with Zeneca representative Lorraine Jennings, in which he informed her that Scott-Levin had encountered problems with plaintiff in the past. The e-mail reads:

  I explained to [Lorraine Jennings of Zeneca] that we
  have a policy of not dealing directly with Simulate
  due to problems in the past. I described to her the
  problems we encountered with Simulate when they did a
  project for BMS including the fact that they changed
  file specs without informing BMS and then tried to
  blame us for all their conversion problems (which
  later proved to be Simulates [sic] problem). I also
  informed her that since then I have learned that
  Simulate left Glaxo with a non-functioning
  system.*fn2

Beck Decl. at Exhibit E.

2. The Slide

The other basis for plaintiff's claims is a slide shown by defendant Vicciardo during a Scott-Levin client conference held on August 6, 7 and 8, 1997, in Baltimore, Maryland. Pl.Resp. at 11. At that conference, Vicciardo delivered a slide show presentation to representatives of pharmaceutical companies. Included in the presentation was the following slide:

  simulate — to assume the outward qualities or
  appearance of, often with the intent to deceive.
  Source: Webster's Ninth New Collegiate Dictionary

Nine slides prior to the slide in question, Vicciardo showed a slide that read:

Competitor's claim:

  Call us today to find out how we can help you
  leap-frog over the labor-intensive information
  production processes associated with tools like
  DATAVIEW and Report Generator.*fn3

The language quoted as the "Competitor's claim" was taken from the plaintiff's 1996 marketing brochure. Plaintiff claims that "simulate" was a thinly veiled, defamatory reference to plaintiff, which, at the time of the conference was named Simulate, Inc. The publication of the slide to the audience, plaintiff asserts, caused plaintiff to lose business.

II. Summary Judgment Standard

Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment is appropriate if "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). The party moving for summary judgment bears the initial burden of demonstrating the basis for its motion, and identifying those portions of the "pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits if any," which demonstrate the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Once the moving party has filed a properly supported motion, the burden shifts to the nonmoving party to "set forth specific facts showing that there is a genuine issue for trial." Fed.R.Civ.P. 56(e).

To determine whether summary judgment is appropriate, the district court judge must determine whether any genuine issue of material fact exists. An issue is "material" only if the dispute "might affect the outcome of the suit under the governing law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). An issue is "genuine" only if ...


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