AMERICAN SOUTHERN HOMES HOLDINGS LLC v. ERICKSON
4:21-cv-00095
| M.D. Ga. | Jun 15, 2023Background
- Plaintiffs American Southern Homes Holdings, LLC (ASHH) and ASH-Grayhawk, LLC (ASH-GH) purchased Erickson’s Columbus-area homebuilding assets in a 2019 asset sale that included an APA, LPA, Consulting Agreement (incorporating Employment Agreement confidentiality terms), a TSA, and CAA/TAA assigning certain IP to ASH‑GH.
- The APA included a non‑compete limiting Erickson from homebuilding within 100 miles of the sellers’ markets (Columbus, Auburn, Atlanta, Macon, Dothan, Montgomery); GH ATL (Dallas, GA) and GH SC (Charleston area) were not listed sellers.
- Post‑closing, Erickson formed Grand Oak Builders and continued consulting until ASH terminated his Consulting Agreement for alleged misuse of confidential information; ASH also alleged breaches relating to LPA lot development failures and IP misuse.
- Plaintiffs sued asserting confidentiality, LPA breaches, non‑compete breach, copyright and trademark infringement; Defendants filed counterclaims including that the non‑compete was unenforceable, warranty holdback mismanagement, assumed‑contract performance, consulting reimbursement, TSA breach/quantum meruit.
- The court resolved cross‑motions for summary judgment: it granted some claims/counterclaims, denied others, and left several factual disputes for trial (notably confidentiality, trademark likelihood of confusion, LPA §10 remedies, and TSA scope/quantum meruit).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Enforceability & breach of APA non‑compete | Erickson violated the covenant by operating GH ATL and GH SC from Columbus | Covenant covers only sellers’ markets; activity outside 100‑mile zones not prohibited | Covenant enforceable but limited to specified territory; Erickson did not breach; declaratory challenge to covenant denied |
| Warranty holdback refundability | Holdback was non‑refundable | ‘‘Deposit’’ was refundable when warranty services ended | Deposit refundable; summary judgment for Defendants on Counterclaim 2 |
| Assumption of Reeves build contract | ASH‑GH assumed and thus breached the Reeves contract | Memo wasn’t provided pre‑closing; lots never developed; no assumption | ASH‑GH had no obligation to build Reeves home; summary judgment for Plaintiffs on Counterclaim 3 |
| LPA §10 development order and takedowns (§6 & §14) | LPA Sellers failed to agree on Phase C order and failed to sell finished lots/offer future lots | LPA required a development order within a year; sellers could terminate; excess takedowns not required; many Dallas/Carrollton lots were pre‑closing | Court: genuine disputes remain on §10 (denies summary judgment on that aspect); grants Defendant summary judgment as to §6 (no obligation to sell excess lots) and §14 (no ROFR for pre‑closing lots) |
| Consulting/Employment confidentiality & reimbursement | ASH: Erickson misappropriated confidential NDAs, price sheets, checklists; seeks damages and fees | Erickson: docs public or not confidential; reimbursement claims valid for trips | Genuine fact disputes on confidentiality — deny summary judgment; reimbursement claims fail (trips not mutually scheduled/board activity) — summary judgment for Plaintiffs on reimbursement aspect |
| Copyright and trademark infringement (Counts 4–10) | ASH‑GH: Defendants used copyrighted plans and Grayhawk trade name post‑closing | Defendants: ATL/SC plans not conveyed; plans materially different; logos differ; geographic separation reduces confusion | Copyright claims: no substantial similarity / plans not acquired — summary judgment for Defendants. Trademark claims: genuine factual disputes on likelihood of confusion — deny summary judgment |
| TSA scope and quantum meruit for license use | Defendants: TSA omitted material scope terms so quantum meruit available for services/licenses provided | Plaintiffs: TSA is entire agreement and doesn’t include those services | Genuine fact dispute over TSA scope and wind‑down services — deny summary judgment on Counterclaim 7 |
Key Cases Cited
- Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986) (summary judgment standard: no genuine dispute of material fact)
- Home Design Servs., Inc. v. Turner Heritage Homes Inc., 825 F.3d 1314 (11th Cir. 2016) (copyright: access plus substantial similarity required)
- Miller’s Ale House, Inc. v. Boynton Carolina Ale House, LLC, 702 F.3d 1312 (11th Cir. 2012) (thin copyright protection makes modest dissimilarities significant)
- Howard v. Sterchi, 974 F.2d 1272 (11th Cir. 1992) (floor plan differences can defeat substantial similarity)
- Tana v. Dantanna’s, 611 F.3d 767 (11th Cir. 2010) (common‑law trademark infringement hinges on likelihood of consumer confusion)
- Coach House Rest., Inc. v. Coach & Six Rests., Inc., 934 F.2d 1551 (11th Cir. 1991) (geographic separation reduces likelihood of confusion)
- In re Colony Square Co., 843 F.2d 479 (11th Cir. 1988) (parties must strictly follow contractual remedies for defaults)
- Brookhaven Landscape & Grading Co. v. J. F. Barton Contracting Co., 676 F.2d 516 (11th Cir. 1982) (quantum meruit may apply where contract is void, repudiated, or only implied)