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A Fourth Circuit Diet of Coal Dust, Paper Towels, and Spam

A Fourth Circuit Diet of Coal Dust, Paper Towels, and Spam

DRI's The Business Suit
(June 8, 2015)

Covol Fuels No. 4, LLC V. Pinnacle Mining Co., No. 14-1395, 2015 WL 877427 (4th Cir. Mar. 3, 2015)

Lawyers are probably not aware that even refuse material is valuable when it comes from what the Fourth Circuit described as "some of the best coal in the world." But when it became economically unfeasible for a hired company to continue processing the material, the company brought suit against the mine owner under both contract and tort claims. The district court granted summary judgment on all claims, but the Fourth Circuit only partially agreed. There were some ambiguities and genuine issues of material fact regarding the contract issue, so summary judgment was improper. But otherwise summary judgment was proper because the tort claims were precluded by the "gist of the action" doctrine. Plaintiffs may not bring a tort claim under a theory that is in reality based on a contract.

Georgia-Pacific Consumer Products LP v. von Drehle Corp., No. 13-2003, 2015 WL 1404765 (4th Cir. Mar. 30, 2015)

This case involved a trademark dispute over motion-triggered paper towel dispensers. Georgia-Pacific brought suit in North Carolina against a competitor that was selling paper towels to fit into Georgia-Pacific's dispensers. It also brought suits against the competitor's distributors in Arkansas and Ohio. The Arkansas and Ohio cases found against Georgia-Pacific (finding no likelihood of confusion), and were affirmed by their respective courts of appeals, but the North Carolina case found the opposite and awarded damages to Georgia-Pacific. In fashioning a remedy, the North Carolina district court issued a nationwide injunction against the competitor. The Fourth Circuit reversed and explained that "as a matter of comity," the injunction should have been limited to the geographical scope of the Fourth Circuit. Judge Shedd dissented and argued that the majority did not afford the district court proper discretion and did not uphold the goal of the Lanham Act to provide national protection for trademarks.

Beyond Systems, Inc. v. Kraft Foods, Inc., 777 F.3d 712 (4th Cir. 2015)

Although anti-spam statutes are generally thought to protect consumers, this case involved an action by an internet service provider that claimed to have received hundreds of spam emails about Gevalia coffee. However, in actuality the plaintiff had developed hidden e-mail addresses to create "spam traps." Based on the common-law tort doctrine of "volenti non fit injuria" (in other words, "no wrong is done to one who consents"), the Fourth Circuit found that the company was barred from recovery because it had consented to the alleged harm. It actually invited the very spam that it was complaining about and therefore could not recover under a state anti-spam statute.

Article originally appeared in DRI's The Business Suit, June 2015, Vol. 19, Issue 3. Reproduced with permission.

Gregory G. Holland
T (336) 378-5240
F (336) 378-5400
Kip D. Nelson
T (336) 378-5206
F (336) 433-7443
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