852 F. Supp. 2d 925
S.D. Ohio2012Background
- MVMHS and Joy Brush sue ExamOne for declaratory judgment and monetary damages relating to a licensing and agency relationship.
- 1989 License Agreement granted exclusive paramedical exam rights in parts of Ohio; 1991/1995 Agency Agreements expanded territory.
- ExamOne acquired WWHS, allegedly began competing directly in Ohio, using centralized scheduling and a zip-code model to encroach on territory.
- Plaintiffs allege theft of clients, misappropriation of trade secrets, and interference with business and contractual relationships.
- ExamOne terminated the 1995 Agency Agreement in 2011; suit filed May 11, 2011.
- Defendant moves to dismiss under Rule 12(b)(6); court sustains in part and overrules in part.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| What law governs statutes of limitations? | Ohio law governs timeliness; borrowing statute not applicable. | Pennsylvania law applies due to chosen-law provisions. | Ohio law governs; borrowing statute does not apply; limitations analyzed under Ohio. |
| Are the contract, quasi-contract, and tort claims timely under Ohio law? | Breaches after 2000 are within 15-year contract period; other claims within 6 years. | Some claims are time-barred or duplicative of contract claims. | Second and Third (breach), Fourth, Fifth, Seventh (quasi-contract) timely at pleading stage. |
| Are the tort claims time-barred or preempted? | Some acts occurred after 2007; not all time-barred; UTSA does not preempt all torts. | Tort claims time-barred or preempted by UTSA. | Conversion preempted and dismissed; tortious interference claims survive preemption and timeliness analysis at this stage. |
| Should declaratory judgment and quasi-contract/tort claims be dismissed as duplicative or precluded? | Claims pled in alternative; not barred if contract invalid. | Declaratory judgment duplicative; quasi-contract/tort claims barred if contract governing. | Declaratory judgment claim dismissed without prejudice; quasi-contract/tort claims not dismissed at this stage. |
| What about choice of law for non-contractual claims? | 1969 and 1995 provisions ambiguous; Ohio law applies to non-contractual claims. | Pennsylvania law may apply under boilerplate; ambiguity persists. | Ohio conflict-of-laws rules applied; Ohio law governs quasi-contract and tort claims. |
Key Cases Cited
- Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487 (1941) (forum applies its own choice-of-law rules for procedural issues)
- Cole v. Mileti, 133 F.3d 433 (6th Cir.1998) (contractual choice-of-law provisions govern substantive terms, not procedural limits)
- Velotta v. Leo Petronzio Landscaping, Inc., 69 Ohio St.2d 376 (Ohio 1982) (statute of limitations dismissal requires facial bar on the face of complaint)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standards require plausible factual allegations)
- Twombly, 550 U.S. 544 (2007) (threadbare recitals of the elements insufficient)
- Schulke Radio Prod. Ltd. v. Midwestern Broad. Co., 6 Ohio St.3d 436 (Ohio 1983) (validity of contractual choice-of-law provisions under Ohio conflict rules)
- O’Stricker v. Jim Walter Corp., 4 Ohio St.3d 84 (Ohio 1983) (accrual timing for contract-related claims)
- Desai v. Franklin, 2008-Ohio-3957 (Ohio App.3d 2008) (unjust enrichment limitations under Ohio law)
- Allied Erecting & Dismantling Co., Inc. v. Genesis Equip. & Mfg., Inc., 649 F. Supp. 2d 702 (N.D. Ohio 2009) (UTSA preempts misappropriation-based claims; independent factual basis survives)
- Florists’ Transworld Delivery, Inc. v. Fleurop-Interflora, 261 F. Supp. 2d 837 (E.D. Mich. 2003) (declaratory judgment duplicative where relief overlaps with contract claims)