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Collegesource, Inc. v. Academyone

October 28, 2011

COLLEGESOURCE, INC.
v.
ACADEMYONE, INC., ET AL.



The opinion of the court was delivered by: McLaughlin, J.

MEMORANDUM

This case involves two companies that provide online college transfer services. The plaintiff CollegeSource has accused the defendant AcademyOne of republishing course catalogs and course information that CollegeSource digitized and made available to its customers. The parties' dispute has spawned several lawsuits, the first in the Southern District of California (hereinafter the "California Action"),*fn1 one before Judge Padova in this district,*fn2 and the instant lawsuit.

CollegeSource moves to dismiss this case without prejudice, or, alternatively, to transfer the case to the Southern District of California or to stay this case pending the resolution of the California Action. AcademyOne cross-moves to enjoin CollegeSource from litigating the California Action. The Court denies both motions.

I. Procedural History

A. The California Action

On October 27, 2008, CollegeSource sued AcademyOne in the California Action. CollegeSource brought five claims that are also pending in this suit: (1) violation of the U.S. Computer Fraud and Abuse Act; (2) breach of contract; (3) unjust enrichment; (4) trademark infringement; and (5) unfair competition under the Lanham Act. In addition, CollegeSource brought claims for misappropriation and unfair competition under California law and violation of the California Computer Crimes Act. AcademyOne moved to dismiss the California Action for lack of personal jurisdiction. After the court ordered and the parties conducted jurisdictional discovery, CollegeSource opposed the motion to dismiss.

Meanwhile, on December 8, 2008, AcademyOne sued CollegeSource in the Eastern District of Pennsylvania, bringing claims for false advertising, trademark infringement, and cybersquatting. In that case, Judge Padova granted summary judgment on all claims in favor of CollegeSource. AcademyOne, Inc. v. CollegeSource, Inc., No. 08-570, 2009 WL 5184491, at *7, *16-*17 (E.D. Pa. Dec. 21, 2009).

On August 24, 2009, the district court in the California Action concluded that it lacked personal jurisdiction over AcademyOne and dismissed CollegeSource's complaint. See CollegeSource, Inc. v. AcademyOne, Inc., No. 08-1987, 2009 WL 2705426, at *7 (S.D. Cal. Aug. 24, 2009). CollegeSource timely appealed the dismissal to the Ninth Circuit.

B. The Instant Lawsuit

While the Ninth Circuit appeal was pending, and after AcademyOne refused to agree to toll the statute of limitations, CollegeSource initiated this lawsuit on July 20, 2010 and filed an ex parte motion for a temporary restraining order to preserve evidence on AcademyOne's computers. See Decl. of Darren Quinn in Supp. of Mot. To Dismiss, Transfer or Stay ("Quinn Decl."), Ex.

E. The Court denied the motion and instructed both parties not to destroy any potentially relevant information.

On October 19, 2010, the defendants moved to dismiss several counts of CollegeSource's amended complaint. On December 6, 2010, before the defendants' motion to dismiss was decided, CollegeSource moved for a preliminary injunction. The Court scheduled a hearing on the motion for preliminary injunction as well as a pre-hearing conference in chambers.

At the pre-hearing conference on January 18, 2011, the Court inquired about the status of the Ninth Circuit appeal in the California Action. Counsel for defendants attests and CollegeSource admits that CollegeSource declared its intention to go forward with litigating this case regardless of the outcome of the Ninth Circuit appeal in California. See Opp. to CollegeSource's Mot. To Dismiss Without Prej., Transfer, or Stay ("AcademyOne Opp."), Ex. 1 ("Landau Decl.") ¶ 5; Cons. Opp. to AcademyOne's Cross-Mot. To Enjoin CollegeSource and Reply in Supp. of CollegeSource's Mot. To Dismiss ("CollegeSource Reply and Opp.") at 12.

With the understanding that the parties would definitely proceed in this district, the Court moved forward with the case. On January 24, 2011, the Court held a preliminary injunction hearing, took testimony from several witnesses, and accepted exhibits into evidence. Following oral argument on January 26, 2011, and after considering the parties' proposed findings ...


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