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Munro v. Lucy Activewear Inc

United States Court of Appeals, Eighth Circuit

August 9, 2018

Bruce Munro; Bruce Munro Studio Plaintiffs - Appellants
Lucy Activewear, Inc.; Lucy Apparel, LLC; VF Outdoor, Inc.; VF Corporation Defendants - Appellees

          Submitted: May 16, 2018.

          Appeal from United States District Court for the District of Minnesota - Minneapolis.



         Bruce Munro and Bruce Munro Studio (collectively "Munro") appeal the district court's dismissal of his complaint against Lucy Activewear, Inc., Lucy Apparel, LLC, VF Outdoor, Inc., and VF Corporation (collectively "Lucy") and the denial of his motion to amend his complaint based on a finding of futility. Munro argues that the district court erred when it found that his tortious interference claim was preempted by the Copyright Act[1] and that his proposed amended trade dress, trademark, and fraud claims were futile. We disagree with Munro except as to his trademark claim. Thus, we affirm in part and reverse and remand in part.

         I. Background

         Munro is an artist best known for his works "Field of Light" and "Forest of Light"-"large-scale, immersive, light-based installations, and exhibitions." Proposed Amend. Compl. ¶ 1. Munro alleges that Lucy contacted him and proposed a Lucy advertising and promotional campaign featuring Munro's work. He further claims that, relying on a promise of confidentiality, he shared additional information with Lucy about his prior work, including "attendance figures, achieved online/multi media traffic, and promotional methods used for the exhibitions." He further disclosed that he was in talks with public officials in Boston, Massachusetts about creating a public exhibition in the city. Following these disclosures, Munro says that Lucy stopped contacting him and that communications with Boston officials ceased soon thereafter as well.

         In October 2013, Lucy launched a light exhibition and advertising campaign for Lucy in Boston. The exhibition, titled "Light Forest," was an interactive light installation that responded to the participants' movements. An advertising campaign associated with the exhibit crossed several media platforms, including television, print, internet, and in-store displays.

         In 2015, Munro filed a complaint against Lucy in Texas state court alleging that, by presenting the "Light Forest" exhibition and advertising campaign in Boston, Lucy infringed on Munro's trademark and trade dress and usurped a prospective business opportunity. In September 2015, Lucy removed the case to federal court and then filed a motion to dismiss for lack of personal jurisdiction, or, in the alternative, to transfer venue. Lucy also filed a separate Fed.R.Civ.P. Rule 12(b)(6) motion to dismiss for failure to state a claim. In January 2016, the case was transferred to the federal district court in Minnesota. The following month, Lucy renewed its Rule 12(b)(6) motion. Munro responded, but in March 2016, he also moved to amend his complaint. In his proposed amended complaint, Munro alleged: trademark and trade dress infringement, trademark and trade dress dilution, false designation of origin and unfair competition, misappropriation, fraud, tortious interference with prospective business opportunities, and unfair competition. The district court found that Munro's proposed amended complaint was futile and denied his motion to amend. It also granted Lucy's motion to dismiss Munro's complaint for failure to state a claim. The court dismissed without prejudice Munro's fraud claim as well as his trademark claim-to the extent it is based on the similarity of the names of the two exhibitions- but it dismissed all remaining claims with prejudice. Munro appeals.

         II. Discussion

         We usually review the district court's "denial of leave to amend a complaint under an abuse of discretion standard; however, when the district court bases its denial on the futility of the proposed amendments, we review the underlying legal conclusions de novo." Jackson v. Riebold, 815 F.3d 1114, 1122 (8th Cir. 2016) (internal quotation marks omitted). Federal Rule of Civil Procedure 15(a)(2) states "a party may amend its pleading only with the opposing party's written consent or the court's leave[, ] [and] [t]he court should freely give leave when justice so requires." However, "[f]utility is a valid basis for denying leave to amend." Jackson, 815 F.3d at 1122. "[W]hen the court denies leave on the basis of futility, it means the district court has reached the legal conclusion that the amended complaint could not withstand a motion to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure." Cornelia I. Crowell GST Tr. v. Possis Med., Inc., 519 F.3d 778, 782 (8th Cir. 2008). When reviewing "a motion to dismiss an action for failure to state a claim under Rule 12(b)(6), [we] tak[e] the factual allegations in the complaint as true and afford[] the non-moving party all reasonable inferences from those allegations." Butler v. Bank of Am., N.A., 690 F.3d 959, 961 (8th Cir. 2012). A plaintiff's motion to amend the complaint will be granted if he "show[s] that such an amendment would be able to save an otherwise meritless claim." Jackson, 815 F.3d at 1122.

         Munro argues that the district court erred when it denied his motion for leave to amend four of his claims: (1) trade dress infringement; (2) fraud; (3) tortious interference; and (4) trademark infringement. We address each claim in turn.

         1. Trade Dress

         In Dastar Corp. v. Twentieth Century Fox Film Corp., the Supreme Court held that "[t]he Lanham Act was intended to make 'actionable the deceptive and misleading use of marks,' and 'to protect persons engaged in . . . commerce against unfair competition.'" Dastar, 539 U.S. 23, 28 (2003) (quoting 15 U.S.C. § 1127). The Court found, however, that the Lanham Act was not designed to protect originality or creativity and it does not create a cause of action for plagiarism. Id. at 36-37. "Trade dress is the total image of a product, the overall impression created, not the individual features." Aromatique, Inc. v. Gold Seal, ...

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