NutriQuest, LLC v. AmeriAsia Import LLC

Background

NutriQuest sued AmeriAsia in state court over alleged interference with NutriQuest’s exclusive supply agreements for an ingredient used in an animal-feed formula covered by NutriQuest’s ’774 Patent. The state court issued a temporary restraining order preventing AmeriAsia from obtaining, transporting, selling, using, or disposing of certain ingredient. AmeriAsia later sought a declaration that it did not infringe and that the patent was invalid, removed the case to federal court, and eventually faced NutriQuest’s added patent-infringement claims.

AmeriAsia moved for permission to amend its counterclaims. In addition to its existing claims seeking declarations of noninfringement and invalidity, it proposed claims for tortious interference with existing contracts, tortious interference with prospective contractual relationships, violations of the Lanham Act, violations of the Minnesota Deceptive Trade Practices Act, unfair competition, and wrongful issuance of the temporary restraining order.

Futility and Pleading Standards

NutriQuest argued that amendment would be futile. Futility means that the proposed claims could not survive a motion to dismiss for failure to state a legally sufficient claim. The court applied the same plausibility standard used for such motions, accepting well-pleaded factual allegations as true for purposes of the amendment request.

NutriQuest also argued that the proposed claims were barred by a doctrine protecting conduct connected to a person’s right to petition the government through litigation. The court concluded that the doctrine did not bar the proposed claims because AmeriAsia relied on alleged communications to third parties, not on demand letters or direct threats of litigation. The court also noted that whether a person’s statements could be attributed to NutriQuest could not be resolved at this early stage merely because an agreement labeled that person an independent contractor.

NutriQuest further argued that the proposed claims were subject to Federal Rule of Civil Procedure 9(b), which requires fraud-related allegations to identify details such as the time, place, content, and speaker of alleged misrepresentations. Assuming the rule applied to at least some claims, the court found the allegations sufficiently specific. The proposed pleading identified alleged statements to Provimi in October and November 2017, statements by an alleged NutriQuest agent on December 13, 2017, and a December 7, 2017 letter from NutriQuest to an AmeriAsia customer.

Lanham Act Counterclaim

The court denied leave to add the proposed Lanham Act counterclaim as it was pleaded. The court understood the claim to rely mainly on the Lanham Act’s false-endorsement provision, which concerns misleading statements likely to cause confusion about affiliation, connection, association, origin, sponsorship, or approval. AmeriAsia did not allege facts showing that NutriQuest made statements likely to cause that type of confusion between the companies.

The court also noted that AmeriAsia’s allegations might instead suggest a false-advertising theory, which may not require misuse of a protected mark. But AmeriAsia did not clearly identify or brief such a theory in the proposed pleading. The court therefore would not assume that AmeriAsia intended to assert it. The denial was limited to the proposed Lanham Act claim, and AmeriAsia was given an opportunity to clarify that claim in a proposed second amended pleading and, if necessary, renew its motion.

Wrongful Temporary Restraining Order Claim

The court declined to conclude at this stage that AmeriAsia was barred from adding a freestanding claim for wrongful issuance of the temporary restraining order. The federal and Minnesota rules provide procedures for recovering against a bond posted for a wrongfully issued restraint, but neither party identified clear authority requiring dismissal of a separate claim seeking that relief.

Disposition

The court ordered that AmeriAsia’s motion for leave to amend counterclaims was granted in part and denied in part. It was denied only as to the proposed Lanham Act counterclaim and granted otherwise. AmeriAsia had 14 days from the order’s date to circulate a proposed second amended pleading addressing the Lanham Act claim. If NutriQuest did not consent, AmeriAsia could file a renewed motion, which the court would decide based on written submissions.