Free Answer to Complaint - District Court of California - California

Case 3:07-cv-04913-SC

Document 4

Filed 11/01/2007

Page 1 of 10

1 DRY AN CAVE LLP Jennifer A. Jackson (SBN 192998)
2 120 Broadway, Suite 300

Santa Monica, California 90401-2386
3 Telephone: (310) 576-2100 Facsimile: (310) 576-2200 4 jjacksonêbryancave.com

5 DRY AN CAVE LLP
Robert J. Hoffman (Pro Hac Vice Application Pending)
6 Tar Mehta (Pro Hac Vice Application Pending)

3500 One Kansas City Place
7 . 1200 Main Street

Kansas City, Missouri 64105
8 Telephone: (816) 374-3200 Facsimile: (816) 374-3300

9

Attorneys fur Derendant
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10 GFSI, INC. d//a GEAR FOR SPORTS, INC.
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IN THE UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA
SAN JOSE DIVISION

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15 ROBERT TRENT JONES II, INC., and ROBERT TRENT JONES LICENSING GROUP, LLC,
16

Case No. C07-04913-EDL

DEFENDANT GFSI, INC.'S ANSWER
Plaintiffs,

TO COMPLAINT

17

v.
18

GFSI, INC. d//a GEAR FOR SPORTS, INC.,
19

Defendant.

20
21

For its Answer against Plaintiffs Robert Trent Jones II, Inc. ("RTJ", Inc."), and Robert
22

Trent Jones Licensing Group, LLC ("RTJ Licensing") (collectively "Plaintiffs"), Defendant GFSI,
23

Inc. d/b/a Gear for Sports, Inc. ("GFSI") responds as follows:
24

NATURE OF ACTION
25
1. Paragraph 1 of

the Complaint states a legal conclusion to which no response is

26
required. GFSI denies committing any acts giving nse to Plaintiffs' claims.

27
2. GFSI denies the allegations in paragraph 2 of

the Plaintiffs' Complaint.

28
SMO IDOCS\656863. i

ANSWER

Case 3:07-cv-04913-SC

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1

PARTIES
3.

2

GFSI lacks knowledge or information suffcient to venfy the truth of the

3 allegations of paragraph 3 and therefore denies the allegations in paragraph 3 of the Plaintiffs'
4 Complaint.
5

4.

GFSI lacks knowledge or information sufficient to verify the truth of the

6 allegations of paragraph 4 and therefore denies the allegations in paragraph 4 of the Plaintiffs'
7 Complaint.
8
9 allegations of

5.

GFSI lacks knowledge or information sufficient to venfy the truth of the
paragraph 5 and therefore denies the allegations in paragraph 5 of

the Plaintiffs'

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10 Complaint.
11

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6.

GFSI lacks knowledge or information sufficient to venfy the allegations of

12 paragraph 6 and therefore denies the allegations in paragraph 6 of the Plaintiffs' Complaint.
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7. 8.

GFSI admits the allegations in paragraph 7 of

the Plaintiffs' Complaint.

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GFSI denies committing any acts giving nse to Plaintiffs' claims, but does not

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15 contest jurisdiction or venue in this matter.
16

9.

GFSI lacks knowledge or information suffcient to form a belief as to the truth of

17 the allegations of paragraph 9 and therefore denies the allegations in paragraph 9 of the Plaintiffs'
18 Complaint.

19

10.

GFSI admits that it contacted RTJ Licensing for the purose of discussing the idea

20 oflicensing the name and mark ROBERT TRENT JONES in connection with a line of

high

21 quality golf appareL. GFSI denies the remaining allegations in paragraph 10 of the Plaintiffs'
22 Complaint.

23

11.

GFSI admits that it presented RTJ Licensing with a proposed business plan, a copy

24 of which is attached to the Complaint as Exhibit A. GFSI denies the remaining allegations in
25 paragraph 11 of the Plaintiffs' Complaint. 26
12.
GFSI admits that paragraph 12 of

the Plaintiffs' Complaint accurately quotes the

27 proposed business plan, in par, but denies Plaintiffs' construction of

the document is accurate.

28
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ANSWER

Case 3:07-cv-04913-SC

Document 4

Filed 11/01/2007

Page 3 of 10

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13.

GFSI admits that paragraph 13 of

the Plaintiffs' Complaint accurately quotes the

2 document in par, but denies Plaintiffs' construction of

the document as a "representation." GFSI

3 denies the remaining allegations of paragraph 13.

4

14.

GFSI admits that the paries entered into a wntten License Agreement to

5 commence on May 1,2005. Furher answering, GFSI states that the terms ofthat wntten
6 agreement speak for themselves. GFSI denies all other allegations in paragraph 14 ofthe
7 Plaintiffs' Complaint.
8

15.

Answering paragraph 15 of the Complaint, GFSI states that the License Agreement

9 is a written contract with terms that speak for themselves. GFSI denies the remaining allegations
10 of

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paragraph 15.

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16.

GFSI admits that the License Agreement grants GFSI the nght to use the Licensed

12 Rights on terms specifically set out in the License Agreement. GFSI denies any remaining

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13 allegations in paragraph 16 of the Plaintiffs' Complaint.
14

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17.

GFSI admits that the License Agreement allows GFSI to distnbute, display and

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15 promote and sell Licensed Products in the United States and its territories, Canada, Mexico and
16 Japan. GFSI denies any remaining allegations in paragraph 17 of

the Plaintiffs' Complaint.

17

18.

GFSI admits that the License Agreement provides for a calculation of minimum

18 royalty payments to be made. GFSI denies any remaining allegations in paragraph 18 of the
19 Plaintiffs' Complaint.
20
19.

GFSI admits that the License Agreement provides for a pnce modification of the

21 royalty payments if GFSI makes any sales of Licensed Products to an associated or affiiated
22 company. GFSI denies the remaining allegations of paragraph 19 of

the Complaint.

23

20.

Answenng paragraph 20 the Complaint, GFSI states that the License Agreement is

24 a wntten document with terms that speak for themselves. GFSI denies the remaining allegations
25 contained in paragraph 20 of the Plaintiffs' Complaint.

26 27

21. 22.

GFSI denies the allegations of

Paragraph 21 of

the Plaintiffs' Complaint.

GFSI admits that paragraph 22 of

the Plaintiffs' Complaint accurately quotes a

28 portion of the Lincense Agreement, but denies Plaintiffs' construction of the document is accurate.
SMO i DOCS\656863. i

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ANSWER

Case 3:07-cv-04913-SC

Document 4

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23.

GFSI admits that the License Agreement is a wntten document with terms that

2 speak for themselves. GFSI denies the remaining allegations contained in paragraph 23 of the

3 Plaintiffs' Complaint.
4

24.

GFSI admits that the License Agreement is a wntten document with terms that the

5 speak for themselves. GFSI denies the remaining allegations contained in paragraph 24 of

6 Plaintiffs' Complaint.
7

25.

GFSI admits that Section 7 of the License Agreement requires certain advertising
Paragraph 25 of

8 to be approved by RTJ Licensing. GFSI denies all remaining allegations of

the

9 Plaintiffs' Complaint.
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10
11 of

26.

GFSI admits that Paragraph 26 of

the Plaintiffs' Complaint accurately quotes pars
the document is accurate. GFSI

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the License Agreement, but denies Plaintiffs' construction of

12 denies the remaining allegations in paragraph 26 of the Complaint.
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27.

GFSI admits that the License Agreement is a wntten document with terms that
the

14 speak for themselves. GFSI denies the remaining allegations contained in paragraph 27 of

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15 Plaintiffs' Complaint.
16 17

28.

GFSI denies the allegations in Paragraph 28 of

the Plaintiffs' Complaint.

29.

GFSI admits that the License Agreement is a wntten document with terms that
the

18 speak for themselves. GFSI denies the remaining allegations contained in paragraph 29 of

19 Plaintiffs' Complaint.
20
30.

GFSI admits that Section 6.5 of the License Agreement requires GFSI to anually

21 submit its proposed Marketing, Distnbution, Financial and Quality Plan to RTJ Licensing for
22 approval. GFSI denies all remaining allegations in Paragraph 30 of

the Plaintiffs' Complaint.

23

31.

GFSI admits that the License Agreement is a wntten document with terms that

24 speak for themselves. GFSI denies the remaining allegations contained in paragraph 31 of the

25 Plaintiffs' Complaint..
26
32.

GFSI admits that the License Agreement is a wntten document with terms that

27 speak for themselves. GFSI denies the remaining allegations contaned in paragraph 32 ofthe
28 Plaintiffs' Complaint.
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ANSWER

Case 3:07-cv-04913-SC

Document 4

Filed 11/01/2007

Page 5 of 10

1

33.

GFSI admits that the paries met on June 5, 2007. GFSI denies all other allegations

2 in paragraph 33 of

the Plaintiffs' Complaint.
GFSI denies the allegations in paragraph 34 of

3

34. 35. 36.

the Plaintiffs' Complaint.

4
5

GFSI denies the allegations in paragraph 35 of

the Plaintiffs' Complaint.

GFSI denies the allegations in paragraph 36 of

the Plaintiffs' Complaint, including

6 all of its sub-pars.
7
8

37. 38.

GFSI denies the allegations in paragraph 37 of

the Plaintiffs' Complaint. the Plaintiffs' Complaint.

GFSI denies the allegations in paragraph 38 of

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FIRST CLAIM FOR RELIEF

10
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FRAUDULENT MISREPRESENTATION
39.
In response to Paragraph 39, GFSI incorporates by reference each of

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its responses

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40.

GFSI denies the allegations in paragraph 40 of

the Plaintiffs' Complaint.

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SECOND CLAIM FOR RELIEF

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NEGLIGENT MISREPRESENTATION
41.

16

In response to Paragraph 41, GFSI incorporates by reference each of its responses

17 to Paragraphs 1 though 40.
18

42.

GFSI denies the allegations in paragraph 42 of

the Plaintiffs' Complaint.

19

THIRD CLAIM FOR RELIEF

20
21

BREACH OF CONTRACT
43.
In response to Paragraph 43, GFSI incorporates by reference each of

its responses

22 to Paragraphs 1 through 42.
23

44.

Paragraph 44 states a conclusion of

law to which no response is required. To the

24 extent a response is deemed required, GFSI denies the allegations in paragraph 44 of

the Plaintiffs'

25 Complaint.

26 27 28

45. 46.
47.
SMO i DOCS\656863. i

GFSI denies the allegations in paragraph 45 ofthe Plaintiffs' Complaint.
GFSI denies the allegations in paragraph 46 of

the Plaintiffs' Complaint.
the Plaintiffs' Complaint.
5

GFSI denies the allegations in paragraph 47 of

ANSWER

Case 3:07-cv-04913-SC

Document 4

Filed 11/01/2007

Page 6 of 10

1

48.

GFSI denies the allegations in paragraph 48 of

the Plaintiffs' Complaint.

2
3

FOURTH CLAIM FOR RELIEF
TRADEMARK INFRINGEMENT
49.

4

In response to Paragraph 49, GFSI incorporates by reference each of its responses

5 to Paragraphs 1 through 48.

6 7
8

50.

GFSI denies the allegations in paragraph 50 of

the Plaintiffs' Complaint.

51. 52.

GFSI denies the allegations in paragraph 51 of the Plaintiffs' Complaint.
GFSI denies the allegations in paragraph 52 of

the Plaintiffs' Complaint.

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FIFTH CLAIM FOR RELIEF
UNFAIR COMPETITION
53.
In response to Paragraph 53, GFSI incorporates by reference each of

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11

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its responses

12 to Paragraphs 1 through 52.
13 53. ii GFSI denies the allegations in the second paragraph numbered 53 in the Plaintiffs'

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54.

GFSI denies the allegations in paragraph 54 of

the Plaintiffs' Complaint.

16 17
18

SIXTH CLAIM FOR RELIEF
TRADEMARK DILUTION
55.
In response to Paragraph 55, GFSI incorporates by reference each of

its responses

19 to Paragraphs 1 through 54.
20
21

56. 57.

GFSI denies the allegations in paragraph 56 of

the Plaintiffs' Complaint. the Plaintiffs' Complaint.

GFSI denies the allegations in paragraph 57 of

22 WHEREFORE, having fully answered, Defendant GFSI prays that this Cour enter
23 judgment against Plaintiffs' claims, that costs be assessed against Plaintiffs and for such other

24 relief as the Cour shall deem just and proper.
25

26
1/

27 28

Plaintiffs' Complaint erroneously contains two paragraphs numbered "53". For the purose of responding directly and by paragraph number to the allegations, GFSI intentionally repeats the error here.
6

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ANSWER

Case 3:07-cv-04913-SC

Document 4

Filed 11/01/2007

Page 7 of 10

1

AFFIRMATIVE AND OTHER DEFENSES
58. 59.
GFSI incorporates by reference each of

2
3

its responses to Paragraphs 1 through 57.

GFSI's First Affirmative Defense is that Plaintiffs' Complaint fails to state a claim

4 upon which relief can be granted.
5

60.

GFSI's Second Affirmative Defense is that Plaintiffs' claims are barred by the

6 statute of frauds.
7

61.

GFSI's Third Affrmative Defense is that Plaintiffs' tort claims are bared or

8 limited by the economic loss docmne.

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62.

GFSI's Fourh Affirmative Defense is that Plaintiffs' claims are barred by the

10 doctnnes of laches, waiver, unclean hands, and estoppel.
11

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63.

GFSI's Fifth Affirmative Defense is that to the extent Plaintiffs were damaged,

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12 which GFSI at all times denies, Plaintiffs' damages were caused, in whole or in par, by the
13 carelessness, negligence and gross negligence of

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Plaintiffs and others not within the control of

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64.

GFSI's Sixth Affirmative Defense is that to the extent Plaintiffs were damaged,

16 which GFSI at all times denies, Plaintiffs' have neglected, failed and refused to mitigate their

17 damages, if any, and are thereby bared from recovery herein, or any such recovery must be
18 reduced accordingly.
19

65.

GFSI's Seventh Affrmative Defense is that Plaintiffs' claims for punitive,

20 exemplar, or liquidated damages, if granted, would be grossly excessive and would violate the 21 Due Process Clause ofthe U.S. Constitution. GFSI has not received fair notice that it could be
22 subject to substantial punitive damages for the conduct alleged. Its conduct, if any, was not
23 deliberate. The liquidated damages Plaintiffs' seek are disproportionate to any actual damages and

24 far exceed any civil or criminal sanctions that could be imposed for similar alleged conduct.
25
66.

GFSI's Eighth Affirmative Defense is that Plaintiffs' claims for punitive,

26 exemplar, or liquidated damages, if granted, would violate the Eighth Amendment to the U.S.

27 Constitution because it seeks to impose an excessive fine upon GFSI, is penal in natue and seeks
28 to punish GFSI upon vague standards.
7

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Case 3:07-cv-04913-SC

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1

67.

GFSI's Ninth Affirmative Defense is that Plaintiffs' claims for punitive,

2 exemplar, or liquidated damages, if granted, would violate the Equal Protection Clause of

the
wealth and because

3 U.S. Constitution because it discnminates against GFSI on the basis of

4 different amounts can be awarded against two or more defendants for the same conduct where
5 those defendants differ only in matenal wealth.

6

68.

GFSI's Tenth Affirmative Defense is that Plaintiffs' claims for punitive,

7 exemplar, or liquidated damages, if granted, would violate the Separation of

Powers Doctrine

8 since this Cour would be usuring the exclusive power of

the legislatue to define cnmes and

9 establish punishment.

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10

69.

GFSI's Eleventh Affirmative Defense is that Plaintiffs' claim for punitive,

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11 exemplar, or liquidated damages, if granted, would violate the U.S. Constitution as an ex post

12 facto law. Any such award, would effectively be cnminalizing conduct after it has occurred and
13 without appropriate advance notice to GFSI that such conduct may subject it to criminal
14 punishment.

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70.

GFSI's Twelfth Affrmative Defense is that to the extent Plaintiffs' claims for

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16 puntive, exemplar, or liquidated damages rely on acts ofGFSI's agents imputed to GFSI, the

17 limitations inherent in general agency pnnciples prohibit recovery.
18

71.

GFSI's Thirteenth Affrmative Defense is that Plaintiffs' claims relating to the

19 2004 Proposed Plan are bared because such agreements were expressly excluded from the final

20 drafting of the contract at issue in this case.
21

72.

GFSI's Foureenth Affirmative Defense is that Plaintiffs' claims of

fraudulent

22 misrepresentation, and negligent misrepresentation are bared because those claims rely on the
23 2004 Proposed Plan, which is, at best, a negotiating document that was not incorporated into the

24 final contract that governs the relationship between the paries.
25

26 27
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ANSWER

Case 3:07-cv-04913-SC

Document 4

Filed 11/01/2007

Page 9 of 10

1 WHEREFORE, having fully answered, Defendant GFSI prays that this Cour enter
2 judgment against Plaintiffs on each of their claims, that costs be assessed against Plaintiffs, and for
3 such other relief as the Cour shall deem just and proper.

4

Dated:
5

November 1,2007

Respectfully submitted,

6 7
8

BRYAN CA VE LLP Jennifer A. Jackson Robert J. Hoffman Tar Mehta

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By: /s/ Jennfer A. Jackson
Jennfer A. Jackson

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Attorneys fur Derendant GFSI, INC. d//a GEAR FOR SPORTS, INC.

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ANSWER

Case 3:07-cv-04913-SC

Document 4

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Page 10 of 10

PROOF OF SERVICE
1

2
3

I am employed in the County of Los Angeles, State of California. I am over the age of 18 and not a party to the within action. My business address is 120 Broadway, Suite 300, Santa Monica, CA 90401-2305.

On November 1,2007, I served the foregoing document, described as DEFENDANT

4 GFSI, INC.'S ANSWER TO COMPLAINT on each interested part in this action, as follows:
5

Richard Levine

Attorney for Plaintiffs

6 Levine & Baker LLP Suite 400 7 One Mantime Plaza
8

San Francisco, CA 94111

9 Joseph V. Norvell Joeseph T. Kucala 10 Norvell IP LLC
11
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Attorney for Plaintiffs

1776 Ash Street Northfield, IL 60093

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the foregoing document in a sealed envelope i: (BY MAIL) I placed a true copy of addressed to each interested pary as set fort above. I placed each such envelope, with postage 13 thereon fully prepaid, for collection and mailing at Bryan Cave LLP, Santa Monica, California. I 14 am readily familiar with Bryan Cave LLP's practice for collection and processing of correspondence for mailng with the United States Postal Service. Under that practice, the 15 correspondence would be deposited in the United States Postal Service on that same day in the 16 ordinary course of business. 17 18 o (BY FEDERAL EXPRESS) I deposited in a box or other facility maintained by Federal Express, an express carer service, or delivered to a courier or driver authonzed by said express carier service to receive documents, a tre copy of the foregoing document, in an envelope designated by said express service carer, with delivery fees paid or provided for.
the foregoing document to be served by facsimile transmission at the time shown on each transmission report from sending facsimile machine telephone number (310) 576-2200 to each interested pary at the facsimile number shown above. Each transmission was reported as complete and without error. A transmission report was properly issued by the sending facsimile machine for each interested pary served.
o (BY FAX) I caused a true copy of

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20
21

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23

Executed on November 1, 2007, at Santa Monica, Californa.

24
i: (FEDERAL ONL Y) I declare that I am employed in the office of a member of the 25 bar of this Cour at whose direction the service was made.

26
27
28

I declare under penalty of

perjur under the laws of

the United States of Amenca that the

foregoing is true and correct.
/s/ Sherri Grama Sherri Gramza
SMOIDOCS657104.i
Proof of Service