East Coast Test Prep LLC, doing business as Achieve Test Prep; Mark Olynyk, Plaintiffs - Appellants v. Allnurses.com, Inc.; David R. Smits, as Administrator of the Estate of Brian Short; Lisa Dukes; Jennifer Moeller; Uhura Russ; ABC Companies 1-10; John Does, 1-10, Defendants - Appellees
No. 18-3197
United States Court of Appeals For the Eighth Circuit
August 19, 2020
Appeal from United States District Court for the District of Minnesota. Submitted: October 17, 2019.
Before COLLOTON, WOLLMAN, and KELLY, Circuit Judges.
East Coast Test Prep LLC (Test Prep), sells test-preparation services to individuals seeking nursing degrees. Allnurses.com, Inc. (Allnurses), operates a website for nurses and nursing students that allows registered users to open disсussion threads, post comments, and “like” other users’ comments. After certain unfavorable comments were posted about Test Prep, the company and Mark Olynyk, its owner, filed suit against several defendants, including Allnurses, its founder Brian Short, and user Uhura Russ.1 As relevant here, Test Prep alleged claims sounding in defamation, contract, and fraud, as well as other theories of liability asserting that Allnurses had induced users to post negative comments. The district court2 granted Allnurses‘s motion for judgment on the pleadings and dismissed the suit against Russ for lack of personal jurisdiction.
Test Prep argues that the district court erred in concluding that the Communications Decency Act precluded its trade libel claim against Allnurses for comments posted by third parties on Allnurses.com. Test Prep also challenges the district court‘s determination that the complaint‘s factual allegations did not plausibly state claims related to breach of contract and fraud, as well as the district court‘s alternative decision to grant summary judgment on the fraud-based claims. Test Prep argues that Russ had waived any objection to personal jurisdiction and that the case against her should thus have been transferred, not dismissed. We affirm.
I. Background
Allnurses describes its website as “the collective voice of the nursing community, supporting the profession by providing a place where nurses can network, share and learn from their peers.” To participate in the online discussion, users must register with Allnurses. The registration page states, “Your participation implies full acсeptance with our Terms of Service.” The terms of service provide that Allnurses “promote[s] the idea of lively debate,” but that users “are not allowed to post libelous information.” The terms of service also warn that any illegal or inappropriate posts “will be taken down immediately.”
An Allnurses.com user opened a thread entitled “Achieve Test Prep.... anyone?” on the Excelsior College online nursing forum in February 2013. Excelsior College offers nursing degree programs and allows its students to earn credit by examination. Like Test Prep, Excelsior College offers test-preparation programs to help students prepare for exams.
Several users posted comments on the “Achieve Test Prep.... anyone?” thread, which Lisa Dukes moderated.3 The comments discussed the advantages and disadvantages of using Test Prep‘s services in conjunction with Excelsior College‘s registered nursing program. Two sets of comments remain at issue in this case: that Test Prep‘s services were redundant or obsolete and that Test Prep was under federal investigation.
In August 2014, a user posted that Test Prep provided a valuable service, explaining that the classes were well structured and taught by experienсed registered nurses. User JustBeachyNurse responded that Test Prep‘s services would be rendered redundant when Excelsior College began requiring students to take its test-preparation classes. User monkeyhq reiterated the sentiment, opining that third-party test-preparation services “for Excelsior Exams will be obsolete by July 1, 2015” and that paying for such services would be “a total waste of your investment.” Dukes “liked” monkeyhq‘s post.
A Test Prep employee then posted that Test Prep would discontinue its test-рreparation services for nursing, but would continue to offer services for general education courses. Other posts similarly indicated that Test Prep would no longer enroll students in its nursing test-preparation classes. The Test Prep employee later emailed the help desk, stating that she worked for Test Prep and asking if she could participate in the discussion, notwithstanding the terms of service‘s prohibition on promoting or advertising. An Allnurses moderator responded that the employee‘s pаrticipation was acceptable.
On September 12, 2014, Olynyk posted in the “Achieve Test Prep.... anyone?” thread under the username learning-is-good, sparking additional debate. Under the username LadyFree28, Russ posted that Test Prep was “being investigated by the federal government and is under a current lawsuit.” Russ noted that “there are too many forums that have stated th[at] Achieve [Test Prep] ‘deceived’ them with their practices.” Under the username duskyjewel, Jennifer Moeller also posted that Test Prеp was under federal investigation. The thread was closed to new comments on September 16, 2014, because, according to an email from an administrator to Olynyk, it contained misleading information and several members had complained. In December 2014, another Test Prep employee registered as a user on Allnurses.com and posted a comment in a different thread. Her comment was removed, as were the identical comments she posted in the days that followed. Her account was later disabled.
Test Prep moved to compel Allnurses to identify certain users, including JustBeachyNurse and monkeyhq, and to disclose certain IP addresses. Thе magistrate judge denied the motion, in part because the posts by JustBeachyNurse and monkeyhq were not defamatory. The district court affirmed the magistrate judge‘s order, agreeing that JustBeachyNurse‘s and monkeyhq‘s statements were not false assertions of fact, but rather expressed the opinion that a change in Excelsior College‘s policy would render Test Prep‘s services redundant or obsolete.
Test Prep eventually filed a third amended complaint, which Allnurses answered before moving fоr judgment on the pleadings. The district court determined that Test Prep had failed to allege facts sufficient to hold Allnurses accountable for the posts by JustBeachyNurse, monkeyhq, Russ, and Moeller. It thus dismissed the trade libel claim against Allnurses. It also dismissed the claims sounding in contract and fraud, determining that Test Prep had failed to allege facts sufficient to state plausible claims for relief. The district court alternatively granted summary judgment to Allnurses on the fraud claims. The remaining claims relevant on appeal were dismissed as nonactionable.
After representing herself for more than a year and filing multiple documents, Russ obtained pro bono legal representation in Minnesota. Her attorney moved to dismiss the case for lack of personal jurisdiction. The district court granted the motion and denied Test Prep‘s conditional cross-motion to transfer the case to the Eastern District of Pennsylvania, where Russ resides.
II. Judgment on the Pleadings in Favor of Allnurses
We review de novo a district court‘s grant of judgment on the pleadings under the same standard that governs a motion to dismiss under
A. Trade Libel Claim
Test Prep alleged in its trade libel claim that Allnurses had published false allegations about Test Prep‘s products, services, property, or business. “A plaintiff allеging trade libel must prove publication of a matter derogatory to the plaintiff‘s property or business, of a kind designed to prevent others from dealing with him or otherwise to interfere with plaintiff‘s relations with others.” Patel v. Soriano, 848 A.2d 803, 834 (N.J. Super. Ct. App. Div. 2004); see Wilson v. Dubois, 29 N.W. 68, 68 (Minn. 1886) (“False and malicious statements, disparaging an article of property, when followed, as a natural, reasonable, and proximate result, by special damage to the owner, are actionable.“). The published
Test Prep argues that the district court erred in entering judgment on the trade libel claim on the basis of Section 230 of the Communications Decency Act, which “immunizes providers of intеractive computer services against liability arising from content created by third parties.” Fair Hous. Council v. Roommates.com, LLC, 521 F.3d 1157, 1162 (9th Cir. 2008) (en banc) (footnote omitted); see
We conclude that Test Prep has failed to plausibly allege that Allnurses was the “information content provider” of the posts by Russ and Moeller. The Act defines “information content provider” as “any person or entity that is responsible, in whole or in part, for the creation or development of information provided through the Internet or any other interactive computer service.”
B. Contract and Promissory Estoppel Claims
The complaint alleged that the terms of service constituted a contract between Allnurses and its members, which include Olynyk as a registered user of Allnurses.com, and that Test Prep was “an entity intended to benefit” from the contract. According to the complaint, Allnurses breached the contract when it failed to remove certain posts about Test Prep and when it prohibited Olynyk and others from engaging in “lively debate” and from “disagree[ing] with anyone on any type of subject.” The district court determined that the сomplaint did not allege facts in support of the contention that Test Prep was an intended beneficiary of the terms of service, nor did it “properly allege[] that a contract was formed through the [terms of service].” D. Ct. Order of Jan. 29, 2018, at 32. The district court also concluded that Test Prep had failed to state a plausible claim for breach of the implied covenant of good faith and fair dealing.
Test Prep has not challenged the district court‘s determination that the company was not an intended beneficiary of Allnurses‘s terms of service, and the complaint does not allege that the company itself was a party to the contract. In the absence of any contractual relationship between Test Prep and Allnurses, there is no basis for the complaint‘s allegation that Allnurses had “certain obligations to [Test Prep] under the [terms of service] of the [w]ebsite Allnurses.com, including without limitation, to take down defamatory or ‘potentially libelous’ or ‘libelous’ information [and] defamatory posts.” Test Prep‘s separate claim for breach of the implied covenant of good faith and fair dealing likewise fails, because the covenant “does not extend to actions beyond the scope of the underlying contract.” In re Hennepin Cty. 1986 Recycling Bond Litig., 540 N.W.2d 494, 503 (Minn. 1995)).5 We are thus left with the question whether the complaint alleged facts sufficient to state a claim that Allnurses breached a contract with Olynyk, who is both a registered user of Allnurses.com and a plaintiff in this actiоn.6
Olynyk argues that Allnurses breached the terms of service when it did not “immediately tak[e] down libelous information” and when it closed the discussion thread, thereby preventing him from correcting the false and derogatory statements about Test Prep. The terms state, in relevant part:
You are not allowed to post libelous information about a person, school, instructor, health care facility, or entity. Any post which is violative of any law or
is invasive of a person‘s privacy will be taken down immediately. We promote the idea of lively debate. This means you are free to disagree with anyone on any type of subject matter as long as your criticism is constructive and polite.
Assuming that Allnurses‘s terms of service constituted an offer that he accepted when he registered on Allnurses.com, Olynyk has failed to plead facts sufficient to establish any breach by Allnurses. “A breach of contract is a failure, without legal excuse, to perform any promise that forms the whole or part of the contract.” Lyon Fin. Servs., Inc. v. Ill. Paper & Copier Co., 848 N.W.2d 539, 543 (Minn. 2014). “[A] breach of contract claim requires only that the promise at issue be part of the parties’ bargain.” Id.; see Baehr v. Penn-O-Tex Oil Corp., 104 N.W.2d 661, 664-65 (Minn. 1960) (“[A] contract is a legally enforceable promise,” which is an assurance “that a thing will or will not be done.“). Allnurses did not promise in the first quoted paragraph to identify and immediately remove any and all potentially false statements. Instead, it clearly disallowed users from posting libelous information and informed them that illegal or inappropriate pоsts would be removed. Allnurses‘s statement that it “promote[s] the idea of lively debate” was not a promise to keep its discussion threads open, particularly in light of the provision that “[p]roblematic posts/threads may be deleted or closed.” Olynyk‘s breach of contract claims thus fails as a matter of law. Because he made no additional arguments for reversal of judgment on his claim for breach of the implied covenant of good faith and fair dealing, we have no reason to sеparately consider that claim.
Finally, we conclude that the district court properly granted judgment in favor of Allnurses on the promissory estoppel claim. The complaint alleged that Allnurses made “promises in the [terms of service] and through communications with Mark Olynyk.” For the same reasons that the relevant terms of service do not constitute a contractual obligation, they likewise do not constitute a “clear and definite” promise sufficient to support Test Prep‘s promissory estoppel claim. See Martens v. Minn. Mining & Mfg. Co., 616 N.W.2d 732, 746 (Minn. 2000) (holding that a statement was not sufficiently “clear and definite” to constitute an enforceable promise). Moreover, Allnurses made no promises in its explanatory messages to Olynyk stating why the thread had been closed, which constituted “the only communication [Test Prep] allege[d] between Olynyk and Allnurses.” D. Ct. Order of Jan. 29, 2018, at 33.
C. Fraud Claims and Other Theories of Liability
Test Prep claimed that Allnurses committed common law misrepresentation and violated the New Jersey and Minnesota Consumer Fraud Acts. See
Test Prep contends that the district court erred in converting Allnurses‘s motion for judgment on the pleadings to a
III. Dismissal for Lack of Personal Jurisdiction over Russ
Test Prep pleaded claims of defamation, trade libel, and fraud against Russ. Proceeding pro se, Russ moved to dismiss, stating that there was “NO BASIS [for her] being attached to the complaint; LadyFree28 is not an interested business or party affiliated with AllNurses.com.” She also moved for a protective order and filed a counterclaim. The purported counterclaim did not state a legally cognizable claim for relief, but did state that Russ was a Pennsylvania resident, who had completed her registered nursing studies at “a local university” and had held a nursing license in Pennsylvania for eleven years. The filing also stated that she could not retain a lawyer or find pro bono representation due to the “location of lawsuit and geographical location.” Russ filed two additional pro se motions to dismiss, which reiteratеd the factual allegations from her counterclaim. Russ‘s third motion sought dismissal on due process grounds, stating that Russ “does not live in Minnesota or New Jersey, nor does business in either of the aforementioned states and has lived in Pennsylvania for almost 30 years.” After Russ was finally able to secure pro bono legal representation, her attorney moved for dismissal, arguing that the court did not have personal jurisdiction over Russ and that venue in Minnesota was inappropriate.
The district court granted the motion, concluding that it lacked personal jurisdiction over Russ and that she had not waived that defense. The court explained:
The core argument contained in each of Russ‘s pro se pleadings may fairly be summed up as follows: “Why am I being haled into court in Minnesota? I have nothing to do with this dispute!” Although this argument undoubtedly presents a merits challenge, Russ has raised factual issues that implicate jurisdictional and venue challenges as well.
D. Ct. Order of Aug. 9, 2018, at 8-9. The court denied Test Prep‘s cross-motion for transfer to the Eastern District of Pennsylvania.
Reviewing de novo, we conclude that the district court did not err in granting Russ‘s motion to dismiss for lack of personal jurisdiction. See Johnson v. Arden, 614 F.3d 785, 793 (8th Cir. 2010) (standard of review). We likewise conclude that Russ did not waive the defense with her inartful pro se pleadings. Russ‘s pro se counterclaim did not state any legal basis for relief but rather explained that Russ—a longtime Pennsylvania resident—was unable to defend herself in Minnesota. Russ‘s repeated pro se motions to dismiss were understandable in light of the sprawling nature of the case and Test Prep‘s multiple amendments of the complаint. We thus agree with the district court‘s characterization of Russ‘s pleadings as constituting a challenge to the location of the lawsuit. Cf. Alger v. Hayes, 452 F.2d 841, 844-45 (8th Cir. 1972) (holding that the defendant waived his defense of lack of personal jurisdiction because his conduct did “not reflect a continuing objection to the power of the court to act over the defendant‘s person“).
The record belies these arguments. In its motion to transfer and memorandum in support of the motion, Test Prep did not explain that the statute of limitations had run in Pennsylvania; nor did it set forth any substantive arguments regarding whether the interests of justice required transfer instead of dismissal. Test Prep merely stated that “the Eighth Circuit requires courts to consider whether the case should be transferred rather than dismissed” and cited cases to support that assertion. In light of the scant argument Test Prep presented in its motion papers, we conclude that the district court did not abuse its discretion in denying the motion to transfer.7 See Everett v. St. Ansgar Hosp., 974 F.2d 77, 79 (8th Cir. 1992) (standard of review).
Conclusion
Having concluded that the district court did not err in granting Allnurses‘s motion for judgment on the pleadings, we need not decide whether the district court erred in denying Test Prep‘s motion to compel Allnurses to identify certain users and to divulge certain IP addresses.
The judgment is affirmed.