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NSI Nursing Solutions, Inc. v. Volume Recruitment Services, LLC

United States District Court, E.D. Pennsylvania

June 18, 2018

NSI NURSING SOLUTIONS, INC.
v.
VOLUME RECRUITMENT SERVICES, LLC, et al.

          MEMORANDUM OPINION

          SCHMEHL, J.

         This copyright infringement action was originally commenced by Plaintiff on March 1, 2017 in the Court of Common Pleas of Lancaster County, then removed by Defendants to this Court. Following the start of discovery, Plaintiff, on May 4, 2017, registered the materials it claimed were subject to copyright. On May 5, 2017, Plaintiff filed an Amended Complaint. On February 9, 2018, Plaintiff filed a Second Amended Complaint. Presently before the Court is Defendants' motion to dismiss counts I, IV, VII and VIII of the Second Amended Complaint pursuant to Fed.R.Civ.P. 12(b)(6) for failure to state a claim. For the reasons that follow, the motion is granted in part and denied in part.

         To survive a motion to dismiss for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6), the complaint must plead sufficient factual allegations that, taken as a whole, state a facially plausible claim for relief. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A complaint satisfies the threshold of facial plausibility if “the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 663 (2009) (citing Twombly, 550 U.S. at 556). Iqbal explained that although a court must accept as true all of the factual allegations contained in a complaint, that requirement does not apply to legal conclusions; therefore, pleadings must include factual allegations to support the legal claims asserted. Id. at 678, 685. “Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Id. at 678 (citing Twombly, 550 U.S. at 555); see also Phillips v. Cnty. of Allegheny, 515 F.3d 224, 232 (3d Cir.2008) (“We caution that without some factual allegation in the complaint, a claimant cannot satisfy the requirement that he or she provide not only ‘fair notice, ' but also the ‘grounds' on which the claim rests.” (citing Twombly, 550 U.S. at 556 n.3)). Accordingly, to survive a motion to dismiss, a plaintiff must plead “factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 556).

         After Iqbal, when presented with a motion to dismiss for failure to state a claim, district courts should conduct a two part analysis: First, the factual and legal elements of a claim should be separated-the district court must accept all of the complaint's well-pleaded facts as true, but may disregard any legal conclusions; second, a district court must then determine whether the facts alleged in the complaint are sufficient to show that the plaintiff has a “plausible claim for relief.” In other words, a complaint must do more than allege the plaintiff's entitlement to relief: a complaint has to “show” such entitlement with its facts. Fowler v. UPMC Shadyside, 578 F.3d 203, 210-11 (3d Cir. 2009).

         The Second Amended Complaint alleges that Plaintiff NSI Nursing Solutions, Inc. (“NSI”), is a “nationwide firm that focuses on high volume recruitment and retention of registered nurses for hospitals and healthcare systems.” (Second Am. Compl. (“SAC”) ¶ 1.) “The services provided by NSI are unique in the staffing industry.” (SAC ¶ 2.) NSI has developed a proprietary system that enables it to rapidly and permanently fill high volumes of nursing positions. (SAC ¶¶ 17-19.) NSI's proprietary system includes its Copyrighted Works (SAC ¶ 20) and its Trade Secrets (SAC ¶ 21.) Using these methods and materials, NSI has developed over the past 17 years, a unique and valuable reputation in the niche market of high volume registered nurse recruitment and retention. (SAC ¶ 23.)

         Defendants Marco Colosi (“Colosi”) and Debra Pollick (“Pollick”) are former employees of NSI. (SAC ¶ 4.) The SAC alleges that Colosi and Pollick have conspired to unlawfully compete with NSI by, inter alia, copying NSI's Copyrighted Works and Trade Secrets, either exactly or with minor modifications. (SAC ¶¶ 39, 40.) To advance this conspiracy to unlawfully compete with NSI, Colosi and Pollick formed Defendant Volume Recruitment Services, LLC (“VRS”). (SAC ¶¶ 44, 45.) NSI alleges that Defendants' unlawful competition includes:

• Making and maintaining copies of NSI's intellectual property without NSI's authorization (SAC ¶¶ 39 D and E);
• Using infringing versions of the Copyrighted Works without NSI's authorization (SAC ¶¶ 39F and G); and
• Using confusingly similar documents and using NSI's metrics to deceive consumers into believing VRS is affiliated with NSI (SAC ¶ 45).

         NSI asserts the following claims: Count I - Breach of Fiduciary Duty against Colosi; Count II - Breach of Contract against Colosi; Count III - Tortious Interference with Contractual Relations against Pollick; Count IV - Copyright Infringement against all Defendants; Count V - Misappropriation of Trade Secrets against all Defendants; Count VI - False Advertising against all Defendants; Count VII - Unfair Competition against all Defendants; Count VIII - Tortious Interference with Prospective Contractual Relations against all Defendants; and Count IX - Civil Conspiracy against all Defendants.

         Defendants first seek dismissal of NSI's claim for breach of fiduciary duty (Count One) on the basis that the claim is time-barred by Pennsylvania's two-year statute of limitations. That count alleges:

56. As the President of NSI, Defendant Colosi owed a fiduciary duty to NSI.
57. Defendant Colosi breached that fiduciary duty during his time as President by:
A. Maintaining copies of the Copyrighted Works for the purpose of ...

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