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Strauss v. Angie's List, Inc.

United States District Court, D. Kansas

January 31, 2019

STEVE STRAUSS d/b/a CLASSIC TREE CARE, et al., Plaintiffs,
v.
ANGIE'S LIST, INC., Defendant.

          MEMORANDUM AND ORDER

          HOLLY L. TEETER UNITED STATES DISTRICT JUDGE

         Plaintiff Steve Strauss seeks to alter or amend the Court's judgment dismissing his putative class action against Defendant Angie's List, Inc., which asserted violations of the Lanham Act, 15 U.S.C. § 1501, et seq., and the Kansas Consumer Protection Act (“KCPA”), § 50-623, et seq. Doc. 93. Plaintiff contends the Court “misapprehended some of the key facts, [Plaintiff's] position, and/or the controlling law.” Doc. 94 at 2. Because Plaintiff Strauss has failed to demonstrate that the Court committed clear error or that manifest injustice will result absent alteration or amendment of the Court's judgment, the Court denies Plaintiff Strauss's motion.

         I. FACTUAL AND PROCEDURAL HISTORY

         The factual and procedural background is set forth in detail in the Court's November 1, 2018 Memorandum and Order (Doc. 85) granting Defendant's motion to dismiss and denying Plaintiff Strauss's motion to amend his complaint (the “Dismissal Order”) and is not repeated at length herein. In summary, Plaintiff Strauss alleged that Defendant engages in false advertising, primarily through its website, which it markets to consumers as a forum for the viewing and posting of first-hand, consumer-generated reviews of service providers. According to Plaintiff Strauss, Defendant represents to consumers that a search of Defendant's website will return a list of potential service providers, in ranked order, based on the first-hand experience of other consumers. In reality, however, the order in which Defendant displays service providers within search results is substantially affected by whether a service provider pays Defendant to advertise on Defendant's website. Defendant lists advertising (i.e., fee-paying) service providers at the top of search results and may list them above non-advertising (i.e., non-fee-paying) service providers-even if the non-advertising service providers have higher ratings and better reviews. But Defendant does not make this clear to consumers and consumers believe the rankings are based solely on consumer-generated ratings and reviews.

         Plaintiff Strauss owns a tree care business in Kansas. He has been aware of Defendant's advertising services and his ability to affect his ranking in search results on Defendant's website if he paid for such services since 2005. Plaintiff Strauss took advantage of that practice by advertising with Defendant from 2005 through 2016 and, during that time, he paid Defendant more than $200, 000.00 to appear higher in search results. Eventually, in the fall of 2016, Plaintiff Strauss and Defendant had a falling out and Plaintiff Strauss quit advertising on Defendant's website. Plaintiff Strauss alleged that Defendant subsequently posted statements on its website that falsely described, disparaged, and defamed Plaintiff Strauss and his business and services.

         Plaintiff Strauss's Original Complaint asserted: (1) a Lanham Act false advertising claim; and (2) a KCPA unfair, deceptive, or unconscionable practices claim. He also sought class certification of nationwide (Lanham Act) and Kansas-based (KCPA) claims. Defendant moved to dismiss the Original Complaint under Rule 12(b)(6) on numerous grounds, including laches (Lanham Act claims), statute of limitations (KCPA claims), and failure to plausibly plead one or more essential elements of the claim (Lanham Act and KCPA claims).

         Almost two months after Defendant's motion to dismiss was fully briefed, on March 12, 2018, Plaintiff Strauss sought leave to amend his original complaint to join an additional plaintiff, Proposed-Plaintiff David Garner. The proposed amended complaint, however, was nearly identical to the original complaint. It merely added specific factual allegations concerning Proposed-Plaintiff Garner's personal experience with Defendant and added an individual claim on Proposed-Plaintiff Garner's behalf under the Maryland Consumer Protection Act, Md. Code Ann. § 13-301, et seq. The amended complaint did not alter any allegations against Defendant with respect to Plaintiff Strauss. Defendant opposed Plaintiff Strauss's request to amend, arguing largely that the amendment did not address the shortcomings of the original complaint and would therefore be futile as to Plaintiff Strauss, and that the Court would then lack jurisdiction over the only remaining plaintiff, Proposed-Plaintiff Garner.

         On November 1, 2018, the Court entered the Dismissal Order, dismissing the vast majority of Plaintiff Strauss's Lanham Act and KCPA claims as time-barred under either a laches (Lanham Act) or statute of limitations (KCPA) theory. The remaining Lanham Act and KCPA claims were dismissed for failure to plausibly plead at least one essential element of each claim. The Court also denied Plaintiff Strauss's motion to amend as futile because the proposed amended complaint contained the same allegations with respect to Plaintiff Strauss's claims against Defendant and, thus, it did not remedy the original complaint's shortcomings.[1] Plaintiff Strauss now asks the Court to reconsider the dismissal of his Lanham Act claims. See generally Doc. 94. He does not seek reconsideration of the dismissal of his KCPA Claims. Id.

         II. STANDARD OF REVIEW

         Federal Rule of Civil Procedure 59(e) allows a party to file a motion to alter or amend a judgment no later than twenty-eight days after entry of judgment. “Three major grounds that justify reconsideration under Rule 59(e) are: (1) an intervening change in controlling law, (2) the availability of new evidence; and (3) the need to correct clear error or prevent manifest injustice.” Jones v. Colvin, 2015 WL 5883910, at *2 (D. Kan. 2015) (citing Servants of the Paraclete v. Does, 204 F.3d 1005, 1012 (10th Cir. 2000); Phelps v. Hamilton, 122 F.3d 1309, 1324 (10th Cir. 1997)). “[A] motion to alter or amend that reiterates issues originally raised [in prior briefing] and that seeks to challenge the legal correctness of the court's judgment by arguing that the court misapplied the law or misunderstood the litigant's position is correctly asserted pursuant to [Rule 59(e)].” Colvin, 2015 WL 5883910, at *2. But it is inappropriate re-argue an issue previously addressed by the court when the motion merely advances new arguments or supporting facts that were available at the time of the original briefing. Paraclete, 204 F.3d at 1012 (stating that a motion to reconsider is not a proper vehicle through which to “revisit issues already addressed or advance arguments that could have been raised in prior briefing”).

         III. ANALYSIS

         Plaintiff Strauss assures the Court he “does not intend to simply repeat or rehash [his] previous arguments.” Doc. 2. Rather, he contends the Court made five critical errors in dismissing Plaintiff Strauss's claims, each based on the Court's misapprehension of some of the key facts, Plaintiff Strauss's position, and/or the controlling law. Doc. 94 at 2. The Court disagrees. Plaintiff Strauss's motion to reconsider, in reality, raises new arguments that could have been, but were not, raised in prior briefing. These new arguments are not appropriate for consideration on a motion to amend or alter judgment. Moreover, even if the Court considers the merits of Plaintiff Strauss's newly-raised arguments, they are unavailing. Plaintiff Strauss has failed to demonstrate that the Court committed clear error or that manifest injustice will result absent alteration or amendment of the Dismissal Order.[2]

         A. Laches in Rule 12(b)(6) Context

         Plaintiff Strauss first contends that the Court erred in dismissing his Lanham Act claims as time barred under the doctrine of laches because “such an equitable affirmative defense requires factual determinations which cannot be made in connection with a Rule 12(b)(6) motion to dismiss.” In short, Plaintiff Strauss argues the bare allegations in the original complaint provided insufficient information from which the Court could determine whether the required elements of the affirmative defense of laches were met. The Court rejects this argument for two reasons.

         First, Plaintiff Strauss waived this argument by not raising it in prior briefing. Plaintiff Strauss's response to Defendant's affirmative defense of laches was two pages, inclusive of the point-header. He offered two unsupported arguments-both of which addressed only the issue of which state's statute of limitations the Court should use as a guide when conducting the laches analysis. Plaintiff Strauss did not contend-as he does now-that Defendant could not raise an affirmative defense such as laches on a Rule 12(b)(6) motion to dismiss or that the original complaint provided the Court insufficient information from which to analyze the laches defense.

         As noted above, a Rule 59(e) motion to reconsider is not the appropriate vehicle for parties to raise new arguments which could have been, but were not, presented in prior briefing. Paraclete, 204 F.3d at 1012. Arguments not waived in a party's initial briefing are waived and will not be considered on a motion to reconsider. See e.g., Minshall v. McGraw Hill Broad. Co., 323 F.3d 1273, 1288 (10th Cir. 2003) (recognizing that an argument first waived in a reply brief is waived and declining to consider it on a motion to reconsider); Coleman v. B-G Maint. Mgmt., 108 F.3d 1199, 1205 (10th Cir. 1997) (holding that “[i]ssues not raised in the opening brief are deemed abandoned or waived”); Logsdon v. AT&T Commc'ns of Sw., Inc., 2003 WL 1872993, at *1 n.1 (D. Kan. 2003) (declining to consider argument raised for the first time in a motion for reconsideration); Colvin, 2015 WL 5883910, at *2-4 (rejecting new arguments that could ...


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