Get me a rewrite, a federal judge told Insignia Systems, Inc., and this time include some original material.
The Dec. 7 order from Minnesota U.S. District Court Judge Michael J. Davis does not dismiss Insignia’s latest antitrust case against News America Marketing, a division of Rupert Murdoch’s News Corp. But it did tear the complaint apart a bit.
It seems Insignia sued News America on antitrust grounds once before, in 2004, charging that Murdoch’s subsidiary monopolized the in-store promotion business. They settled in 2011, resulting in a tidy $121 million payout for Insignia.
But their settlement agreement included a covenant by which Insignia agreed “not to sue, attempt to introduce as evidence, or otherwise assert any of the released matters and/or the underlying facts or conduct supporting the released matters … in any court, government or regulatory body or other proceedings.”
Nonetheless, Insignia has again sued the company, and on very similar grounds. So similar, the Judge Davis suggested its complaint was, at least in part, an impermissible reun.
Poring over the allegations, the judge found that many—while undated in the most recent complaint—actually are the same accusations Insignia made against News America in its 2004 lawsuit. At least one dates back to 1999.
In fact, allegations on five paragraphs of the complaint pre-date the 2011 settlement, the judge notes in his ruling. And even though Insignia asserts those the old charges are vital to proving its current case, Davis ruled that they “represent a breach of the settlement agreement.”
His ruling came in response to New America’s motion for summary judgment on its counterclaim that the rehashed allegations breached the settlement.
“Insignia argues that News [America] has not demonstrated that it has suffered any harm as a result of the breach,” the judge writes. “The Court disagrees. News has sufficiently demonstrated that its litigation costs have increased as a result of the breach, and that the scope of this lawsuit will change significantly once the covenant not to sue is enforced.”
The judge then ordered Insignia to refile its complaint—but only after striking material in seven paragraphs, including three paragraphs in their entirety.
He denied News America’s request to dismiss the case on summary judgment, holding that the record isn’t yet clear that every allegation challenged by the defendant violates the 2011 covenant.
“Whether or not Insignia is able to prove, for example, that News employed overly broad exclusivity language in their contracts as part of an anticompetitive scheme based on post-2011 facts and conduct is best addressed at summary judgment, once discovery is closed,” the judge ruled.
He also denied News America’s request for attorneys’ fees and costs as premature.
As of late Thursday, Insignia’s revised complaint had yet to be filed.
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