Hartman v. Does, 0:18-cv-61907

Background

Plaintiffs (Platinum Properties Investor Network, The Hartman Media Company, LLC, and Jason Hartman) sued defendants for various claims including statutory false/misleading advertising, common-law fraud, and negligent misrepresentation based on alleged use of counterfeit websites and phony emails to harm Plaintiffs and their business.
Defendants filed an amended motion to dismiss; the Magistrate Judge issued a Report recommending partial grant/denial across multiple counts and dismissal of several claims (some with prejudice, some without).
Plaintiffs objected only to the Magistrate’s recommendations dismissing Counts VII (Florida statutory false advertising), XI (common-law fraud), and XII (negligent misrepresentation) for failure to plead justifiable first‑party reliance.
The District Court conducted de novo review of the objections and the record, adopting most of the Report but revising the rulings on the reliance-related claims.
The Court held that Plaintiffs, as direct competitors alleging competition, adequately pleaded statutory false/misleading advertising (Count VII) because an allegation of competition can stand in for direct first‑party reliance.
The Court rejected Plaintiffs’ argument that third‑party reliance suffices for common‑law fraud and negligent misrepresentation and dismissed Counts XI and XII without prejudice to allow amendment.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Count VII (Florida statutory false/misleading advertising) requires plaintiff to plead first‑party reliance	Plaintiffs: Competitor status obviates need to plead direct first‑party reliance; competition can stand in for reliance	Defendants: Plaintiffs failed to plead first‑party justifiable reliance	Held: Plaintiffs’ allegation of direct competition suffices to stand in for reliance; Count VII survives dismissal
Whether Count XI (common‑law fraud) can be pleaded via third‑party reliance	Plaintiffs: Butler v. Yusem permits not requiring first‑party reliance; can rely on third‑party induced injury	Defendants: Fraud requires plaintiff’s own justifiable reliance to state claim	Held: Third‑party reliance is insufficient; Count XI dismissed without prejudice to amend
Whether Count XII (negligent misrepresentation) can be pleaded via third‑party reliance	Plaintiffs: Same as for fraud; pleadings show injury caused by defendants’ misrepresentations	Defendants: Plaintiff must plead its own reliance to state negligent misrepresentation	Held: Third‑party reliance insufficient; Count XII dismissed without prejudice to amend
Standing for Counts I–III (related parties)	Plaintiffs: all named plaintiffs have standing	Defendants: Jason Hartman and Platinum Properties Investor Network lack standing	Held: Motion granted as to Jason Hartman and Platinum Properties Investor Network (lack standing); denied as to The Hartman Media Company, LLC

Key Cases Cited

Butler v. Yusem, 44 So. 3d 102 (Fla. 2010) (discusses elements of fraudulent misrepresentation and reliance context)
Johnson v. Davis, 480 So. 2d 625 (Fla. 1985) (sets out elements of fraud/fraudulent misrepresentation)
United States v. Schultz, 565 F.3d 1353 (11th Cir. 2009) (standard for de novo review of magistrate judge objections)
Macort v. Prem, Inc., [citation="208 F. App'x 781"] (11th Cir. 2006) (discusses standard of review for unobjected portions of magistrate reports)