ClaimSolution, Inc. v. Claim Solutions LLC

          ORDER DENYING MOTION TO ENFORCE SETTLEMENT AGREEMENT, AWARD ATTORNEY'S FEES AND STAY ALL DEADLINES PENDING

          WILLIAM J. MARTÍNEZ, UNITED STATES DISTRICT JUDGE.

         Before the Court is Plaintiff ClaimSolution, Inc.'s (“Plaintiff”) Motion to Enforce Settlement Agreement, Award Attorney's Fees and Stay All Deadlines Pending (“Motion”) against Defendant Claim Solutions, LLC (“Defendant”). (ECF No. 28.) For the reasons set forth below, Plaintiff's Motion is denied.

         I. BACKGROUND

         On July 7, 2017, Plaintiff brought claims against Defendant, alleging that Defendant “infringed on its registered trademark by operating a business in the insurance field with the same or substantially the same name.” (ECF No. 28 at 3; see also ECF No. 1 at 5-7.) In addition, Plaintiff alleged that Defendant was “operating a website under a domain name that infringed on its registered trademark.” (ECF No. 28 at 3; see also ECF No. 1 at 7-8.)

         On September 12, 2017, counsel for the parties began informal settlement discussions. (ECF No. 28 at 4.) On January 19, 2018, Defendant's counsel sent to Plaintiff's counsel the following e-mail (the “January 19^th Settlement Offer”):

[Defendant] has agreed to change the company name with the secretary of state. We believe this will save both are [sic] clients unnecessary time and expense. Along with the domain change, and $1, 000 in payment[, ] we would like you to reconsider this offer. I will get back with you concerning the name change with the secretary of state as soon as possible.

(ECF No. 28-2 at 1.) Plaintiff asserts that Defendant's January 19^th Settlement Offer “contained three clearly defined terms.” (ECF No. 28 at 1.) In particular, Plaintiff alleges that Defendant offered to: “(1) change its infringing name with the secretary of state; (2) transfer its infringing website domain to Plaintiff [the “Second Term”]; and (3) remit $1, 000.00 to Plaintiff [collectively, the “Three Terms”].” (Id. at 1-2.)

         Defendant, however, rejects Plaintiff's interpretation of its January 19^thSettlement Offer in regard to the Second Term. (ECF No. 29 at 1.) Defendant asserts that, “[d]espite Plaintiff's contention, Defendant never sent an email to Plaintiff offering to transfer its website name to Plaintiff, ” but instead the e-mail only provided that Defendant would “change its domain.” (Id.)^[1]

         On January 25, 2018, Plaintiff's counsel sent Defendant's counsel an e-mail stating that Plaintiff “has agreed to settle for the terms [contained in the January 19^thSettlement Offer.]” (ECF No. 28-3.) In addition, the e-mail stated that Plaintiff would “draft a settlement agreement and send it to [Defendant] for review.” (Id.) Plaintiff contends that this e-mail was its written acceptance of Defendant's January 19^thSettlement Offer and that the Three Terms were included in that offer. (ECF No. 28 at 2.) Defendant, however, maintains that the parties had a misunderstanding in regard to the Second Term. Defendant asserts that this “misunderstanding on both sides concerning what exactly was to be done about Defendant's website” was a “fundamental issue.” (ECF No. 29 at 1-2.)

         On February 14, 2018, Plaintiff's counsel e-mailed Defendant's counsel “a draft of the settlement agreement” and asked him to redline any changes he may have. (ECF No. 28-4 at 1.) Approximately one hour later, Defendant's counsel responded that “[t]he only issue” Defendant had with the “proposed settlement agreement” was the time Defendant was given to transfer the domain. (ECF No. 28-5 at 1.) In particular, Defendant's counsel “request[ed] at least 60 days from the date of settlement before transferring the rights to the domain name to allow [Defendant] enough time to redirect [its] web traffic.” (Id.) Defendant's counsel further noted that in “previous discussions” the parties had discussed a transfer timeline of six months. (Id.)

         Within minutes, Plaintiff's counsel responded that it would agree to give Defendant sixty days to transfer the rights to the domain name. (Id.) Attached to Plaintiff counsel's e-mail was a revised settlement agreement which included the Three Terms and a sixty-day domain transfer term (the “February 14^th Document”). (ECF No. 28 at 2.) Plaintiff alleges that at this point in time, “the parties had reached a settlement and were in full agreement as to the wording of the written Settlement Agreement memorializing all terms.” (Id.) Thus, Plaintiff's Motion is asking this Court to enforce the February 14^th Document as the alleged operative settlement agreement.

         After receiving the February 14^th Document, Defendant's counsel asserts that he “immediately notified [Plaintiff's] counsel” that “Defendant had noticed an additional issue with the transferring of the domain name . . . .” (ECF No. 29 at 2.) Defendant's counsel also e-mailed Plaintiff's counsel “inquiring as to whether Plaintiff would be open to Defendant's current website redirecting to Defendant's new website, or simply shutting down the website entirely without transferring any rights to the domain name.” (ECF No. 29 at 2; see ECF No. 28-7 at 2.) Defendant's counsel stated in the e-mail that Defendant “is concerned that if there is a [domain] transfer that the site could contain material that is detrimental to [Defendant's] business.” (ECF No. 28-7 at 2.) On February 19, 2018, Plaintiff's counsel responded that “[Plaintiff] would be willing to have the website shut down and include in the agreement that [Defendant] agrees never to re-register the domain name.” (Id. at 1.) In addition, Plaintiff's counsel attached a revised settlement agreement that included such “termination language [that Plaintiff] will agree to” (the “February 19^th Document”). (Id.)^[2] Moreover, Plaintiff's counsel asked Defendant's counsel to insert into the February 19^th Document the name Defendant will be registering with the secretary of state. Once Defendant's counsel had inserted the new name, Plaintiff's counsel said he would “put the settlement agreement in a PDF” and each party could then execute the agreement. (Id.) Later that day, Defendant's counsel e-mailed Plaintiff's counsel the February 19^th Document with Defendant's new name included. (Id.)

         On February 27, 2018, Plaintiff's counsel sent Defendant's counsel an e-mail that contained the following:

We've ran into a little problem. I understood that my client was fine with your client simply shutting down the website, but I misunderstood what they were wanting. They want your client to transfer the website to them as part of the settlement. The relinquishment of the website is something they believe is a fundamental part of the settlement. . . . My client only wants the domain name ...