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Gregory S. Markantone, DPM, PC v. Podiatric Billing Specialists, LLC

United States District Court, W.D. Pennsylvania

June 9, 2014

GREGORY S. MARKANTONE, DPM, PC., And GREGORY S. MARKANTONE, Plaintiffs,
v.
PODIATRIC BILLING SPECIALISTS, LLC, Defendant.

MEMORANDUM OPINION ON MOTION OF DEFENDANT TO DISMISS UNDER FED. R. CIV. P. 12(b)(6)

LISA P. LENIHAN, Chief Magistrate Judge.

I. Summation

The Motion to Dismiss filed by Defendant The Podiatric Billing Specialists, LLC ("Defendant") will be granted on substantive grounds, [1] as Plaintiff corporation Gregory S. Markantone, DPM., PC., and Plaintiff individual Gregory S. Markantone (collectively, "Plaintiffs") fail to state a cognizable claim for copyright infringement. See Dawes-Lloyd v. Publish America LLLP, 441 Fed.Appx. 956, 957 (3d Cir. 2011) (holding that a prima facie case of copyright infringement requires a registered copyright under 17 U.S.C. § 411(a) (2012)); 17 U.S.C. § 501(a) (2012) (stipulating that alleging the violation of one or more of the "exclusive rights" granted to a copyright owner is essential to a cause of action for copyright infringement). "This case is simply a contractual dispute between Pennsylvania parties."[2] Reply Brief in Support of Defendant's Motion to Dismiss at ¶ 2 (ECF No. 13). Accordingly, because the parties are not diverse, upon dismissal of the federal question presented by the copyright claim and absent extraordinary circumstances, the Court lacks jurisdiction over all pendent state law claims. Dismissal of the Complaint in its entirety will therefore be granted. Furthermore, Plaintiffs' Notice of Demand for Data Backup (ECF No. 4) and Motion to Compel Impoundment of Subject-Matter (ECF No. 14) are mooted by grant of Defendant's Motion to Dismiss.

II. Factual and Procedural History

Plaintiff corporation is a podiatry medical practice located in Latrobe, Pennsylvania. Plaintiffs' Complaint ("Complaint") at ¶¶ 1, 6 (ECF No. 1). Plaintiff individual practices at the same location. Id. at ¶ 1. Plaintiffs make a blanket assertion that they have a "copyright ownership interest" in their "office procedures, patient information, operational rules, and related data" ("Medical Data"). Id. at ¶¶ 6, 8. Defendant, a Pennsylvania limited liability company, is a "professional podiatric billing specialist" that developed companion software and/or "podiatry templates" to facilitate the collection and entry of patient data ("the Content"). Id. at ¶¶ 2, 9.

On February 22, 2012, Plaintiff corporation and Defendant entered into a "Content License Agreement" ("the Agreement"). Compl. & Ex. 1 (ECF No. 1-1). Pursuant to the Agreement, Plaintiff corporation purchased (1) a license to use Allscripts MyWay software under the terms of the Allscripts MyWay software license agreement[3] and (2) a license to use the companion Content developed by the Defendant. Id. at ¶ 1. The license between Plaintiff corporation and Defendant remained in effect only as long as the requisite Allscripts MyWay software remained available. Id. at ¶ 5. Allscripts retired its MyWay software, see Compl. at ¶ 24 & Ex. 5 at ¶ 1 (ECF No. 1-5), which, in turn, triggered the termination of the Agreement. The Agreement fails to fully address either (a) the extraction of a podiatrist's Medical Data from Defendant's proprietary Content or (b) any associated costs has created a contract interpretation dispute between the parties.[4]

In December 2013, Plaintiffs demanded from Defendant the "immediate tender" of the Medical Data, including any content "incorporated with it."[5] See Compl. & Ex. 2 at ¶ 3 (ECF No. 1-2). Defendant maintained that there were problems associated with extracting and transferring Plaintiffs' Medical Data while protecting its proprietary Content. See Compl. & Ex. 3 at ¶ 2 (ECF No. 1-3). Plaintiffs aver that Defendant proposed Plaintiffs pay $2000.00 in exchange for the transfer of "deactivat[ed]" database(s) and disavowed any responsibility as to the integrity of the deactivated Content. Id. at ¶ 3.[6] Plaintiffs declined the offer. See Compl. & Ex. 2 at ¶¶ 4-5.

Plaintiffs filed suit against the Defendant on February 13, 2014. See Compl. Plaintiffs' claim for copyright infringement is premised on Defendant's "using Plaintiffs [ sic ] Medical Data in a manner against the directive of Plaintiffs... in violation of 17 USC [ sic ]." Id. at ¶ 33. The Complaint sets forth five additional counts including: Declaratory Relief; Permanent and Temporary Specific Performance/Injunction; Breach of Contract; Tortuous Interference with Contractual Relations; and Tortuous Interference with Prospective Business Advantage. Id. at ¶¶ 17-31.

In response, on April 14, 2014, Defendant filed a motion to dismiss the Complaint in its entirety. See Defendant's Motion to Dismiss (ECF No. 5). Defendant avers that Plaintiffs fail to state a cognizable copyright infringement claim and, because the parties are not diverse, upon proper dismissal of the federal question presented, this Court lacks jurisdiction over the pendent state law claims. Id.

III. Applicable Standard of Review

Recently, the United States Court of Appeals for the Third Circuit aptly summarized the standard to be applied in deciding motions to dismiss filed pursuant to Fed.R.Civ.P. 12(b)(6):

Under the "notice pleading" standard embodied in Rule 8 of the Federal Rules of Civil Procedure, a plaintiff must come forward with "a short and plain statement of the claim showing that the pleader is entitled to relief." As explicated in Ashcroft v. Iqbal , 556 U.S. 662, 678 (2009), a claimant must state a "plausible" claim for relief, and "[a] claim has facial plausibility when the pleaded factual content allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Although "[f]actual allegations must be enough to raise a right to relief above the speculative level, " Bell Atlantic Corp. v. Twombly , 550 U.S. 544, 555 (2007), a plaintiff "need only put forth allegations that raise a reasonable expectation that discovery will reveal evidence of the necessary element." Fowler v. Univ. of Pittsburgh Med. Ctr. Shadyside , 578 F.3d 203, 213 (3d Cir. 2009); see also Covington v. Int'l Ass'n of Approved Basketball Officials , 710 F.3d 114, 117-18 (3d Cir. 2013).

Thompson v. Real Estate Mortg. Network, ___ F.3d ___, 2014 WL 1317137, *2 (3d Cir. Apr. 3, 2014).

"In deciding a Rule 12(b)(6) motion, a court must consider only the complaint, exhibits attached to the complaint, matters of public record, as well as undisputedly authentic documents if the complainant's claims are based upon these ...


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