Category: Trial Lawyers

Claims for Unfair Competition in Pennsylvania

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The Pennsylvania Court of Common Pleas has defined unfair competition according to its definition in the Restatement (Third) Unfair Competition § 1 (1995). See e.g. Babiarz v. Bell Atl.-Pa., Inc., 2001 WL 1808554, at *9 (Pa.Com.Pl. July 10, 2001); Lakeview Ambulance & Med. Servs., Inc. v. Gold Cross Ambulance & Med. Serv., Inc., 1995 WL 842000, at *1-2 (Pa.Com.Pl. Oct. 18, 1995). Under the Restatement (Third), “[o]ne who causes harm to the commercial relations of another by engaging in a business or trade is not subject to liability to the other for such harm unless … the harm results from … other acts or practices of the actor determined to be actionable as an unfair method of competition.” According to Comment G of the Restatement (Third), “[a]s a general matter, if the means of competition are otherwise tortious with respect to the injured party, they will also ordinarily constitute an unfair method of competition.” Hence, tortious interference may form the basis of a claim for unfair competition. ID Security Sys. Canada, Inc. v. Checkpoint Sys., Inc., 249 F.Supp.2d 622, 688 (E.D.Pa.2003).

Several judges in the Eastern District of Pennsylvania have applied the Restatement (Third) definition of unfair competition when faced with a Pennsylvania state law unfair competition claim. See, e.g., Synthes (USA) v. Globus Med., Inc., 2005 WL 2233441, at *9 (E.D.Pa. Sept. 14, 2005); Id Security, 249 F.Supp.2d at 688; Air Products and Chemicals, Inc. v. Inter-Chemical, Ltd.,2003 WL 22917491, at *12 (E.D.Pa. Dec. 2, 2003); Fresh Made, 2002 WL 31246922, at *9. To date, however, no appellate court in Pennsylvania has applied the Restatement (Third) to the common law tort of unfair competition.

According to the Third Circuit, “[a] claim of unfair competition under Pennsylvania law requires proof that the defendant has ‘passed off’ the goods of one manufacturer or vendor as those of another, thus creating confusion between his own goods, and those of the rival.” Scanvec Amiable Ltd. v. Chang, 80 Fed.Appx. 171, 180 (3d Cir.2003) (citing to Penn. State Univ. v. Univ. Orthopedics, Ltd., 706 A.2d 863, 870-71 (Pa.Super.Ct.1998)) (“The gist of the action lies in the deception practiced in ‘passing off’ the goods of one for that of another.”) Bldg. Materials Corp. of Am. v. Rotter, 535 F.Supp.2d 518 (E.D.Pa.2008).

If you have a claim for unfair competition, please contact an attorney at Sidkoff, Pincus & Green, with attorneys licensed in Pennsylania and New Jersey and offices in Philadelphia, Pennsylvania.

Legal Malpractice Claims in Pennsylvania

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In order to establish a claim of legal malpractice, a plaintiff must demonstrate three basic elements:

1) employment of the attorney or other basis for a duty; 2) the failure of the attorney to exercise ordinary skill and knowledge; and 3) that such negligence was the proximate cause of damage to the plaintiff. Rizzo v. Haines, 520 Pa. 484, 499, 555 A.2d 58, 65 (1989).

An essential element to this cause of action is proof of actual loss rather than a breach of a professional duty causing only nominal damages, speculative harm or the threat of future harm. Id. at 504-05, 555 A.2d at 68. Damages are considered remote or speculative only if there is uncertainty concerning the identification of the existence of damages rather than the ability to precisely calculate the amount or value of damages. Id. In essence, a legal malpractice action in Pennsylvania requires the plaintiff to prove that he had a viable cause of action against the party he wished to sue in the underlying case and that the attorney he hired was negligent in prosecuting or defending that underlying case (often referred to as proving a “case within a case”). Kituskie v. Corbman, 552 Pa. 275, 281, 714 A.2d 1027, 1029-30 (1998).

If you believe that you may have a viable claim for legal malpractice against your former Pennsylvania attorney, please feel free to contact an attorney at Sidkoff, Pincus  & Green, with attorneys licensed in New Jersey and Pennsylvania, and offices in Philadelphia, Pennsylvania.

The First Sale Doctrine

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Copyright law provides copyright owners several exclusive rights, including the right to distribute copies of their works. See, 17 U.S.C. §106 (2006) (granting copyright owners the exclusive rights to reproduce their works, prepare derivative works, distribute copies, to perform their works publicly, and to display the copyrighted works publicly). However, a copyright owner’s exclusive right to distribution is limited by a provision that authorizes the owner of a particular copy of a work to sell or otherwise dispose of that copy without having to seek the permission of the copyright owner. 17 U.S.C. § 109(a).  In other words, a copyright holder who sells or gives away a copy of his or her work no longer retains an exclusive right over that particular copy.  The new owner of that copy can then sell it, donate it, rent it or otherwise dispose of it, with certain exceptions for leasing/renting related to software and phonorecords. See, 17 U.S.C. § 109(b).

The statutory provision at hand, Section 109 of the Copyright Act, is a codification of the “first sale doctrine” and an extension of the principle stated in 17 U.S.C.A. § 202 that ownership of the material object is distinct from ownership of the copyright in the material. Columbia Pictures Industries, Inc. v. Redd Horne, Inc., 749 F.2d 154 (3d Cir. 1984). The “first sale doctrine,” which was developed under prior law, provided that the copyright owner’s exclusive right to distribute copies of the copyrighted work extended only to the first sale of that copy. Platt & Munk Co. v. Republic Graphics, Inc., 315 F.2d 847 (2d Cir. 1963); Independent News Co. v. Williams, 293 F.2d 510 (3d Cir. 1961); U.S. v. Powell, 701 F.2d 70 (8th Cir. 1983); U.S. v. Wise, 550 F.2d 1180 (9th Cir. 1977); C. M. Paula Co. v. Logan, 355 F. Supp. 189 (N.D. Tex. 1973). After the first sale of a copy, the copyright owner had no further control over future sales of that copy.

Although Section 109 of the Copyright Act has many clear benefits to the public, including the discounted secondary sales market for products (such as Ebay, Craigslist, yard sales and used book stores), the large shift towards digital consumption of works (via websites such as Itunes and Amazon’s digital store, and for products such as ipods, ipads, kindles and nooks) constrains the benefits of the first sale doctrine.  Since the Copyright Act does not allow consumers to purchase digital products, copy them, and resell them on the secondary market, the applicability of Section 109 to digital purchases would seem extremely limited, if not eliminated.  Accordingly, as consumers move from physical copies to digital works, many of the benefits of first sale doctrine will be lost