Wyndham Vacation Ownership, Inc. v. The Montgomery Law Firm, LLC

UNITED STATES DISTRICT COURT

MIDDLE DISTRICT OF FLORIDA

TAMPA DIVISION

WYNDHAM VACATION OWNERSHIP,

INC., WYNDHAM VACATION

RESORTS, INC., WYNDHAM RESORT

DEVELOPMENT CORPORATION,

SHELL VACATIONS, LLC, SVC-WEST,

LLC, SVC-AMERICANA, LLC and SVC-

HAWAII, LLC,

Plaintiffs,

v. Case No: 8:19-cv-1895-T-36CPT

THE MONTGOMERY LAW FIRM, LLC,

MONTGOMERY & NEWCOMB, LLC, M.

SCOTT MONTGOMERY, ESQ., W.

TODD NEWCOMB, ESQ., CLS, INC.,

ATLAS VACATION REMEDIES, LLC,

PRINCIPAL TRANSFER GROUP, LLC,

DONNELLY SNELLEN, JASON LEVI

HEMINGWAY, MUTUAL RELEASE

CORPORATION, DAN CHUDY,

MATTHEW TUCKER and CATALYST

CONSULTING FIRM LLC,

Defendants.

___________________________________/

ORDER

This matter comes before the Court upon the Plaintiffs’ Motion to Strike Defendants'

Affirmative Defenses and Incorporated Memorandum of Law (Doc. 166), Defendants’ Brief in

Opposition to Wyndham’s Motion to Strike Affirmative Defenses (Doc. 173), Plaintiffs’ Reply in

Support of Motion to Strike Affirmative Defenses (Doc. 177), Plaintiffs’ Motion to Dismiss

Defendants’ Counterclaims and Incorporated Memorandum of Law (Doc. 167), and

Counterclaimants’ Brief in Opposition to Wyndham’s Motion to Dismiss Counterclaims (Doc.

172). In the motion to strike, Plaintiffs argue that Defendants’ affirmative defenses must be

stricken because they are improper for a variety of reasons. Doc. 166. In the motion to dismiss,

Plaintiffs argue that Defendants’ counterclaims must be dismissed because they are barred by the

litigation privilege, constitute a shotgun pleading, and fail to state a claim. Doc. 167. The Court,

having considered the motion and being fully advised in the premises, will grant Plaintiffs’ motions

and give Defendants leave to file amended affirmative defenses and counterclaims.

I. FACTUAL BACKGROUND1

Plaintiffs, Wyndham Vacation Ownership, Inc.; Wyndham Vacation Resorts, Inc.;

Wyndham Resort Development Corporation; Shell Vacations, LLC; SVC-West, LLC; SVC-

Americana, LLC; and SVC-Hawaii, LLC (collectively “Plaintiffs”), filed this action against

numerous Defendants, including The Montgomery Law Firm, LLC; Montgomery & Newcomb,

LLC; M. Scott Montgomery, Esq.; W. Todd Newcomb, Esq.; CLS, Inc. d/b/a Atlas Vacation

Remedies and d/b/a Principal Transfer Group; Atlas Vacation Remedies, LLC; Principal Transfer

Group, LLC; Donnelly Snellen; Jason Levi Hemingway; Mutual Release Corporation a/k/a 417

MRC LLC; Dan Chudy; Matthew Tucker, and Catalyst Consulting Firm, LLC (collectively,

“Defendants”). Doc. 1. The instant motions concern Defendants’ Consolidated Answers,

Affirmative Defenses and Counterclaims (Doc. 149) filed by Atlas Vacation Remedies, LLC;

Jason Hemingway; Principal Transfer Group, LLC; Donnelly Snellen; CLS, Inc.; W. Todd

Newcomb, Esq.; M. Scott, Montgomery, Esq., The Montgomery Law Firm, LLC , and

Montgomery & Newcomb, LLC. In the Complaint, Plaintiffs referred to Atlas Vacation Remedies,

LLC, Hemingway; Principal Transfer Group, LLC; Snellen; and CLS, Inc. as “the CLS

1 The following statement of facts is derived from the Complaint (Doc. 1), the allegations of which

the Court must accept as true in ruling on the instant Motion to Dismiss. Linder v. Portocarrero,

963 F.2d 332, 334 (11th Cir. 1992); Quality Foods de Centro Am., S.A. v. Latin Am. Agribusiness

Dev. Corp. S.A., 711 F.2d 989, 994 (11th Cir. 1983).

Defendants.” Doc. 1 at 1. Plaintiffs referred to The Montgomery Law Firm, LLC; Montgomery

& Newcomb, LLC; M. Scott Montgomery, Esq.; and W. Todd Newcomb, Esq. as “the

Montgomery Law Defendants.” Id.

Plaintiff Wyndham Vacation Ownership, Inc. (“Wyndham Vacation”) is the parent

company, or ultimate parent company, of Plaintiffs Wyndham Vacation Resorts, Inc. (“Wyndham

Resorts”), Wyndham Resort Development Corporation (“Wyndham Development”), and Shell

Vacations LLC (“Shell”). Id. ¶ 58. Wyndham Resorts, Wyndham Development, and Shell enter

into timeshare contracts with consumers (“Owners”). Id. ¶ 59. When Owners purchase

timeshares, they execute contracts in which the Owners agree to pay a certain amount to cover

their interest, maintenance, and annual fees, and also agree to pay their share of the property taxes.

Id. Owners often obtain loans for their timeshare and execute a note and mortgage, which

documents are incorporated into the timeshare purchase agreement and are part of the contract. Id.

Plaintiffs allege that the Montgomery Law Defendants used who they refer to as “the TPE

Defendants”—Catalyst Consulting Firm LLC, the CLS Defendants, Mutual Release Corporation,

and Tucker—to carry out schemes. Doc. 1 ¶ 33. Additionally, Plaintiffs allege that the CLS

Defendants are a group of companies, fictitious names, and individuals who work together as a

timeshare exit company. Id. ¶ 38. A “timeshare exit” industry recently sprouted, which Plaintiffs

allege “target[s] the timeshare industry” and induces timeshare owners to breach their contracts.

Id. ¶ 6.

Plaintiffs’ allege Defendants “instruct, deceive, induce, or persuade” the Owners to stop

making their timeshare payments, ensuring the timeshare owners go into default and their interest in

the properties is foreclosed. Id. ¶¶ 13-22. To implement this scheme, Plaintiffs allege that Defendants

use false and misleading advertising to induce Owners to breach their timeshare contracts. Id. ¶¶ 6-

21, 92-138. Defendants guarantee successful exit from their timeshare contracts but do not advise the

Owners of the consequences of ceasing payments, i.e. default and foreclosure. Id. 9-22. Although the

Defendants play different roles in the described scheme, Plaintiffs allege that their conduct is

intertwined.

The CLS Defendants, MRC Defendants, and Catalyst use various advertising methods,

including online, telemarketing, direct mailing, and in-person sales presentations, to target and solicit

Plaintiffs’ timeshare owners to use their timeshare exit services. Id. ¶¶ 92-138. Those advertisements

state that the CLS Defendants, MRC Defendants, or Catalyst retain lawyers to aid in canceling the

timeshare contracts, and the Montgomery Law Defendants fill that role. Id. ¶¶ 75–78. The CLS

Defendants, MRC Defendants, and Catalyst, then refer clients to the Montgomery Law Defendants,

who are aware of the advertisements and send demand letters on behalf of the Owners to Plaintiffs. Id.

¶¶ 75-82. After sending the demand letters, Defendants take almost no further action, hoping that the

threat of litigation will convince Plaintiffs to cancel or release the timeshare owners from their

contracts. Id. ¶ 83.

Based on Defendants’ alleged harm to Plaintiffs’ businesses and relationships with timeshare

owners, Plaintiffs filed the Complaint in this action seeking damages and injunctive relief. Id. 22-24.

Plaintiffs bring claims for: (1) false and misleading advertising and contributory advertising under the

Lanham Act, 15 U.S.C. § 1125(a)(1); (2) tortious interference with contractual relations; (3) civil

conspiracy; and (4) violation of Florida’s Deceptive and Unfair Trade Practices Act, Fla. Stat. §

501.201, et seq. (“FDUTPA”). Id. ¶¶ 155-274.

After the Complaint was filed, several Defendants moved to dismiss the action for lack of

personal jurisdiction or, alternatively, to transfer the venue to the United States District Court for the

Western District of Missouri. Doc. 31. As part of the Motion to Dismiss, Defendants alleged that

Plaintiffs failed to state a claim for tortious interference because Plaintiffs did not identify Owners who

were purportedly induced to terminate their contract with Plaintiffs. Id. at 10-11. In ruling that the

Complaint states a claim for tortious interference, the Court concluded that Plaintiffs need not identify

individual Owners at this stage of the proceeding. Doc. 144 at 9. The Court ultimately ruled that

personal jurisdiction exists, and transfer to Missouri was not appropriate, but sua sponte transferred

the action to this division from the Orlando Division of the United States District Court for the Middle

District of Florida. Id. at 16-22.

After the transfer, Defendants Atlas Vacation Remedies, LLC; Hemingway; Principal Transfer

Group, LLC; Snellen; CLS, Inc.; Newcomb; Montgomery; The Montgomery Law Firm, LLC; and

Montgomery & Newcomb, LLC filed Defendants’ Consolidated Answers, Affirmative Defenses and

Counterclaims (“Answer”) that Plaintiffs now seek to strike and dismiss. Doc. 149. In the Answer,

Defendants include approximately fifty-three paragraphs of affirmative defenses. Id. ¶¶ 275-328.

Defendants also raise four counterclaims. Id. ¶¶ 329-379. The first counterclaim is a claim for tortious

interference with existing and prospective business relationships, the second is for trade libel, the third

is for common law unfair competition, and the final counterclaim is for false advertising under the

Lanham Act. Id. ¶¶ 344-379.

II. LEGAL STANDARD

A. Motion to Dismiss

To survive a motion to dismiss under Rule 12(b)(6), a pleading must include a “short and

plain statement of the claim showing that the pleader is entitled to relief.” Ashcroft v. Iqbal, 556

U.S. 662, 677-78 (2009) (quoting Fed. R. Civ. P. 8(a)(2)). Labels, conclusions and formulaic

recitations of the elements of a cause of action are not sufficient. Id. (citing Bell Atl. Corp. v.

Twombly, 550 U.S. 544, 555 (2007)). Furthermore, mere naked assertions are not sufficient. Id.

A complaint must contain sufficient factual matter, which, if accepted as true, would “state a claim

to relief that is plausible on its face.” Id. (quoting Twombly, 550 U.S. at 570). “A claim has facial

plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable

inference that the defendant is liable for the misconduct alleged.” Id. (citation omitted). The court,

however, is not bound to accept as true a legal conclusion stated as a “factual allegation” in the

complaint. Id.

B. Motion to Strike

Federal Rule of Civil Procedure 12(f) provides that, upon motion, the court may order

stricken from a pleading an insufficient defense or an immaterial matter. District courts have broad

discretion in ruling on a motion to strike. OMS Nat’l Ins. Co. v. Turbyfill, No.

3:14cv622/MCR/CJK, 2015 WL 11109377, at *1 (N.D. Fla. July 22, 2015). However, a court will

not exercise its discretion under the rule to strike a pleading unless the matter sought to be omitted

has no possible relationship to the controversy, may confuse the issues, or otherwise prejudice a

party. Poston v. Am. President Lines, Ltd., 452 F. Supp. 568, 570 (S.D. Fla.1978); Bazal v. Belford

Trucking Co., 442 F. Supp. 1089, 1101 (S.D. Fla.1977); Augustus v. Bd. of Pub. Instruction, 306

F.2d 862, 868 (5th Cir.1962).

III. DISCUSSION

A. Affirmative Defenses

“An affirmative defense is defined as ‘[a] defendant’s assertion raising new facts and

arguments that, if true, will defeat the plaintiff’s or prosecution’s claim, even if all allegations in

the complaint are true.’ ” Ayers v. Consol. Const. Servs. of SW Fla., Inc., 207CV123FTM29DNF,

2007 WL 4181910, at *1 (M.D. Fla. Nov. 26, 2007) (quoting Saks v. Franklin Covey Co., 316 F.3d

337, 350 (2d Cir.2003)). Should a defendant “mislabel[] a denial as an affirmative defense, the

proper remedy is not to strike the claim, but rather to treat it as a specific denial.” Berman v. Kafka,

No. 3:13-cv-1109-J-JBT, 2014 WL 12616999, at *1 (M.D. Fla. May 5, 2014) (quoting Grovenor

House, L.L.C. v. E.I. Du Pont De Nemours & Co., No. 09-21698-Civ., 2010 WL 3212066, at *3

(S.D. Fla. Aug. 12, 2010)).

“An affirmative defense will only be stricken if the defense is insufficient as a matter of

law . . . .” OMS Nat’l Ins. Co., 2015 WL 11109377, at *1 (quoting Beaulieu v. Bd. of Trs. of Univ.

of W. Fla., No. 3:07cv30, 2007 WL 2900332, at *5 n.7 (N.D. Fla. Oct. 2, 2007)). The Federal

Rules of Civil Procedure do not require a defendant to support affirmative defenses with elaborate

factual detail and require only that the defense give fair notice of the nature of the defense to the

plaintiff. Berman, 2014 WL 12616999, at *2. Bare-bones, conclusory allegations, however, are

insufficient to support an affirmative defense. Niagara Distributors, Inc. v. N. Ins. Co. of N.Y.,

10-61113-CIV, 2011 WL 13096637, at *1 (S.D. Fla. Apr. 11, 2011) (citing Microsoft Corp. v.

Jesse’s Computers & Repair, Inc., 211 F.R.D. 681, 684 (M.D. Fla. 2002)). Instead, an affirmative

defense is sufficient if it is supported by “relevant and substantial legal and factual questions . . .

.” Id.

“[M]otions to strike affirmative defenses are not favored by the federal courts because of

their somewhat dilatory and often harassing character that merely amass unnecessary costs.”

Gamez v. ACE Am. Ins. Co., 11-22842-CIV, 2011 WL 13115473, at *1 (S.D. Fla. Dec. 2, 2011)

(citing 5C Charles Alan Wright & Arthur R. Miller, Fed. Prac. & Proc. § 1381; Kaiser Aluminum

& Chemical Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1052 (5th Cir. 1982)).

Nonetheless, the Court finds that it is appropriate in this case to strike Defendants’ affirmative

defenses, without prejudice to Defendants filing amended affirmative defenses that comply with

this Court’s rules.

Despite the low pleading standard for affirmative defenses, Defendants’ pleading is simply

too confusing and unorganized to allow Plaintiffs or the Court to discern what affirmative defenses

are being raised. For example, there are certain paragraphs in which it is not apparent whether the

allegations are intended as factual support for unidentified affirmative defenses, or seek to assert

an independent defense, or general commentary on Defendants’ opinion of the Complaint. See

Doc. 149 ¶¶ 304, 306. Other defenses seem to be redundant. See id. ¶¶ 285-286. A number of

the purported defenses are, in reality, simply denials, further complicating matters. See, e.g. 275-

76, 288-89, 297, 300-303, 305. The Court will not attempt to untangle the jumbled allegations

contained in Defendants’ purported affirmative defenses.2 Accordingly, they are stricken and

Defendants are granted leave to file amended affirmative defenses that comply with the Federal

Rules of Civil Procedure.

B. Shotgun Pleading

Plaintiffs argue that the counterclaims must be dismissed because they constitute a shotgun

pleading that incorporates all prior paragraphs into each count. Doc. 167 at 6-7. The Court agrees.

“A complaint that fails to articulate claims with sufficient clarity to allow the defendant to

frame a responsive pleading constitutes a ‘shotgun pleading.’” Lampkin-Asam v. Volusia Cnty.

Sch. Bd., 261 F. App’x. 274, 277 (11th Cir. 2008) (internal citation omitted). The Eleventh Circuit

has identified four general types of shotgun pleadings. Weiland v. Palm Beach Cnty. Sheriff’s

Office, 792 F.3d 1313, 1322–23 (11th Cir. 2015). Relevant here, a complaint that contains

“multiple counts where each count adopts the allegations of all preceding counts, causing each

successive count to carry all that came before and the last count to be a combination of the entire

complaint” constitutes a shotgun pleading. Id. at 1322. Additionally, a complaint which asserts

2 To the extent that Plaintiffs seek to strike Defendants’ affirmative defenses that claim a litigation

privilege because such defenses have been rejected by other courts, such a request is improper for

a motion to strike. Smith v. Wal-Mart Stores, Inc., No. 1:11-cv-226-MP-GRJ, 2012 WL 2377840

(N.D. Fla. June 25, 2012) (stating that “in ruling upon a motion to strike it is not appropriate for

the Court to consider the merits of any affirmative defense because the Court accepts all well-pled

facts as true and only evaluates the legal sufficiency of an affirmative defense.”). Indeed, the case

cited by Plaintiffs was resolved on summary judgment. Westgate Resorts, Ltd. v. Sussman, 387 F.

Supp. 3d 1318 (M.D. Fla. 2019). The Court will not address the merits of Defendants’ affirmative

defenses through a motion to strike.

“multiple claims against multiple defendants without specifying which of the defendants are

responsible for which acts or omissions, or which of the defendants the claim is brought against,”

constitutes a shotgun pleading. Id. at 1323.

Not only does each count of the counterclaims incorporate the prior count, the counts also

incorporate the affirmative defenses and answer. Because of this, the Court cannot determine what

allegations are pertinent to what count, and what actions are purported to have been taken by the

Plaintiffs to support Defendants’ allegations as to each count. Accordingly, the counterclaims are

dismissed without prejudice to Defendants filing amended counterclaims. Additionally, although

the counterclaims must be dismissed on the basis that they constitute a shotgun pleading, the Court

will address the merits of the claims to provide guidance to Defendants should they elect to file

amended counterclaims.

C. Tortious Interference

To state a claim for tortious interference with a business relationship in Florida, the plaintiff

must allege: “(1) the existence of a business relationship, (2) the defendant’s knowledge of that

relationship, (3) an intentional and unjustified interference with the relationship, and (4) injury

resulting from the breach of the relationship.” Dunn v. Air Line Pilots Ass’n, 193 F.3d 1185, 1191

(11th Cir. 1999). The business relationship element “requires a relationship with a particular party,

and not just a relationship with the general business community.” Id. The Eleventh Circuit has

previously affirmed dismissal of a complaint where the plaintiffs alleged that the defendant’s

actions prevented them from “sell[ing] their labor to the general community,” and not to a specific

entity. Id.

Plaintiffs argue that this claim should be dismissed because Defendants have not identified

individual Owners, but allege only that Plaintiffs are or have interfered with a pool of customers.

Doc. 167 at 8. As the Court determined in its Transfer Order, it is unnecessary at this stage of the

proceeding to identify specific individuals. Doc. 144 at 9. Nonetheless, the Court agrees that

Defendants’ allegations as to this count are insufficient. In the Complaint, Plaintiffs specifically

allege that Defendants “successfully solicited Wyndham Owners and caused or induced them to

breach and/or terminate their contractual relationships with Plaintiffs,” and that Defendants

“intentionally procured the breach of Wyndham’s contractual relationships by soliciting

identifiable Wyndham Owners . . . .” Doc. 1 ¶¶ 206-207. Additionally, Plaintiffs further explain

that “[t]he specific Wyndham Owners and Timeshare Contracts are identifiable,” but attaching

relevant documents identifying the Owners to the Complaint was impractical given the length of

the documents. Id. ¶ 207 n.3.

In their counterclaim for tortious interference, Defendants do not provide the same

specificity. Instead, Defendants assert that they “possess existing and prospective business

relationships with clients and customers that had purchased timeshare properties or timeshare

points from Wyndham . . . .” Doc. 149 ¶ 347. Defendants provide no further specificity. These

vague allegations do no more than identify a business community and are insufficient to support a

claim for tortious interference with a business relationship. Accordingly, Defendants’

counterclaim for tortious interference is due to be dismissed on this basis.

D. Trade Libel

To state a claim for trade libel,

[A] plaintiff must allege: (1) a falsehood; (2) that has been published or communicated to

a third person; (3) when a defendant-publisher knows or reasonably should know that it

will likely result in inducing others not to deal with plaintiff; (4) the falsehood actually

plays a material and substantial part in inducing others not to deal with plaintiff; and (5)

special damages proximately result of the published falsehood . . . .

Diamond Resorts Int’l, Inc. v. Aaronson, 617CV1394ORL37DCI, 2018 WL 735627, at *8 (M.D.

Fla. Jan. 26, 2018). A heightened pleading standard applies to the element of special damages,

which must be specifically stated. Id. This requires a plaintiff to allege more than general

pecuniary harm and instead plead “a pecuniary loss that has been realized or liquidated, such as

lost sales.” Id. (citing Salit v. Ruden, McClosky, Smith, Schuster & Russell, P.A., 742 So. 2d 381,

388 (Fla. 4th DCA 1999); Collier Cty. Publ’g, Co. v. Chapman, 318 So. 2d 492, 495 (Fla. 2d DCA

1975)). “However, Rule 9(g) requires no more than a specific statement that allows a defendant

to prepare a responsive pleading and begin its defense.” ThermoLife Int’l LLC v. Vital Pharm.

Inc., 19-CV-61380, 2020 WL 409594, at *2 (S.D. Fla. Jan. 24, 2020).

Here, Defendants allege only that they “are entitled to recovery of damages, punitive

damages and injunctive relief under applicable law.” Doc. 149 ¶ 357. This is insufficient to meet

the pleading standard to allege trade libel and this count is due to be dismissed on this basis.

E. Unfair Competition

“To a state a claim for unfair competition under Florida common law a party must plead

(1) deceptive or fraudulent conduct of a competitor and (2) likelihood of consumer confusion.”

Third Party Verification, Inc. v. Signaturelink, Inc., 492 F. Supp. 2d 1314, 1324 (M.D. Fla. 2007).

“To state claim for unfair competition, the pleading party must allege that it competes with its

opponent for a common pool of customers.” Id. (citing Home Design Servs., Inc. v. Park Square

Enters., Inc., 2005 WL 1027370, *13–14 (M.D.Fla.2005).

Defendants’ counterclaim does not state a claim for unfair competition. The counterclaim

states only that “[t]he foregoing actions of Wyndham constitute unfair competition under the

common law of the State of Florida,” that, as a result, Defendants were damaged in an amount to

be determined at trial, and that the unlawful acts will continue to cause irreparable damage and

injury to Defendants. Doc. 149 ¶¶ 358-361. However, there is no factual section of Defendants’

counterclaims, and all previous paragraphs of the Answer, including affirmative defenses and prior

counterclaims, are incorporated, making it impossible to discern what the alleged “foregoing

actions” that support Defendants’ claims could be. Accordingly, this claim is due to be dismissed.

F. False Advertising

In their final counterclaim, Defendants allege a claim for false advertising under the

Lanham Act. Doc. 149 ¶¶ 362-378. In this claim, Defendants allege that Plaintiffs have a program,

known as Ovation, which is intended for Owners unhappy with their timeshare contract. Id. ¶¶

365-65. Defendants state that this program is deceptive, illusory, and inadequate because it is a

program for surrender of the timeshare investment, not a buy-back, certain Owners do not qualify

or are not considered by Plaintiffs, and there is a delay under the Ovation program. Id. ¶ 366.

To state a claim for false advertising under the Lanham Act, 15 U.S.C. § 1125(a), the

claimant must allege:

(1) the advertisements of the opposing party are false or misleading as to the party’s

own product of another’s; (2) the advertisements actually deceived customers or

had the tendency to deceive a substantial portion of the targeted audience; (3) the

deception is material, meaning it is likely to influence purchasing decisions; (4) the

defendant's advertised products traveled in interstate commerce; and (5) the

plaintiff has been or is likely to be injured as a result of the false or misleading

advertisements by casually related declining sales or loss of goodwill.

Third Party Verification, Inc. v. Signaturelink, Inc., 492 F. Supp. 2d 1314, 1324 (M.D. Fla. 2007)

(citing Hickson Corp. v. N. Crossarm Co., Inc., 357 F.3d 1256, 1260-61 (11th Cir.2004)). “Section

1125(a) of the Lanham Act ‘extends only to plaintiffs whose interests fall within the zone of

interests protected’ by the Lanham Act.” Westgate Resorts, Ltd. v. Reed Hein & Assocs., LLC,

618CV1088ORL31DCI, 2018 WL 5279156, at *9 (M.D. Fla. Oct. 24, 2018) (quoting Lexmark

Int’l, Inc. v. Static Control Components, Inc., 134 S. Ct. 1377, 1377 (2014)). To fall within the

zone of interests, a claimant must allege an injury to its sales or business reputation that was

proximately caused by the defendant’s misrepresentations. Id. (citing Lexmark, 134 S. Ct. at

1395).

Here, Defendants’ allegations are too jumbled to discern what false statements were

purportedly made by Plaintiffs, partially because of the incorporation of the entire Answer into the

claim. Although Defendants allege that Plaintiffs’ Ovation program does not accomplish the

sought-after goal, Defendants do not state that Plaintiffs made representations about the program

that were false. Accordingly, this claim must be dismissed.

G. Litigation Privilege

Plaintiffs also seek to dismiss Defendants’ state law counterclaims for tortious interference

with a business relationship, trade libel, and unfair competition based on the litigation privilege.

Doc. 167 at 4-6. The Florida Supreme Court recognizes a litigation privilege, which affords

absolute immunity to acts occurring during the course of a judicial proceeding as long as the act

has some relation to the proceeding. Echevarria, McCalla, Raymer, Barrett & Frappier v. Cole,

950 So. 2d 380, 384 (Fla. 2007) (citing Levin, Middlebrooks, Mabie, Thomas, Mayes Mitchell,

P.A. v. United States Fire Ins. Co., 639 So.2d 606 (Fla. 1994)).

“[T]he litigation privilege is an affirmative defense, and therefore, ‘should ordinarily be

asserted in a responsive pleading and considered after the facts are developed on summary

judgment or at trial.’ ” Mansoorian v. Brock & Scott, PLLC, 8:18-CV-1876-T-33TGW, 2018 WL

6413484, at *6 (M.D. Fla. Dec. 6, 2018) (quoting Gills v. Armfield, No. 8:10-CV-895-T-27TBM,

2011 WL 13175840, at *4 (M.D. Fla. Mar. 30, 2011)). The affirmative defense of the litigation

privilege may be considered at the motion to dismiss stage, however, where “ ‘the complaint

affirmatively and clearly shows the conclusive applicability’ of the privilege.” Id. (quoting

Jackson v. BellSouth Telecommunications, 372 F.3d 1250, 1277 (11th Cir. 2004)).

To the extent that Defendants’ counterclaims are based on the filing of lawsuits, the Court

agrees that the litigation privilege bars such claims. Pace v. Bank of N.Y. Mellon Tr. Co. Nat’l

Ass’n, 224 So. 3d 342, 345 (Fla. 5th DCA 2017) (“In the context of a tortious interference with

business relationships claim, the act of filing the complaint is subject to absolute immunity under

the litigation privilege.”). However, it is not apparent that Defendants’ claims are based

exclusively on the lawsuits. Instead, Defendants also include allegations regarding statements

alleged to have been made by Plaintiffs to support their claims. Doc. 149 ¶ 359 (basing

Defendants’ counterclaim in part on various statements allegedly made by Plaintiffs). Therefore,

at this stage, the Court cannot determine conclusively whether the litigation privilege applies.

Accordingly, the Court will deny Plaintiffs’ request to dismiss these claims with prejudice on the

basis of the litigation privilege. Accordingly, it is

ORDERED:

1. Plaintiffs’ Motion to Strike Defendants’ Affirmative Defenses and Incorporated

Memorandum of Law (Doc. 166) is GRANTED. Defendants’ Affirmative Defenses are

STRICKEN. Defendants are granted leave to file amended affirmative defenses that cure the

deficiencies noted in this Order and comply with the Federal Rules of Civil Procedure within

FOURTEEN (14) DAYS of the date of this Order. Failure to file amended affirmative defenses

within the time provided will result in this case proceeding without assertion of any affirmative

defenses by Defendants.

2. Plaintiffs’ Motion to Dismiss Defendants’ Counterclaims and Incorporated

Memorandum of Law (Doc. 167) is GRANTED. Defendants’ Counterclaims are DISMISSED

without prejudice. Defendants are granted leave to file amended counterclaims that cure the

deficiencies noted in this Order within FOURTEEN (14) DAYS of the date of this Order. Failure

to file amended counterclaims within the time provided will result in this case proceeding without

counterclaims.

DONE AND ORDERED in Tampa, Florida on May 5, 2020.

Charlene Edwards Honeywell

United States District Judge

Copies to:

Counsel of Record and Unrepresented Parties, if any

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