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East Coast Test Prep LLC v. Allnurses.Com, Inc.

United States District Court, D. Minnesota

January 29, 2018

EAST COAST TEST PREP LLC d/b/a Achieve Test Prep and MARK OLYNYK, Plaintiffs,
ALLNURSES.COM, INC., ABC COMPANIES 1-10, JOHN DOES 1-10, DAVID R. SMITS, as Administrator of the Estate of Brian Short, LISA DUKES, and UHURA RUSS, Defendants.

          Richard L. Ravin, HARTMAN & WINNICKI, P.C., and Paul A. Grote, RIEZMAN BERGER, P.C. for plaintiffs.

          John D. Reddall and James J. Kretsch, Jr., KRETSCH LAW OFFICE, PLLC, and Keith J. Miller and Justin T. Quinn, ROBINSON MILLER LLC for defendants.



         This sprawling case is about defamation: a test prep company has sued a nursing discussion forum and five of its users for their mildly disparaging remarks about the company's offerings. Plaintiffs are East Coast Test Prep LLC, doing business as Achieve Test Prep, and its president Mark Olynyk (collectively, “ATP”). Defendants are and David Smits (administrator of the estate of company founder Brian Short) (collectively, “Allnurses”) and users Lisa Dukes and Uhura Russ.

         ATP claims that “Allnurses secretly schemed to have false statements posted about ATP, using ATP's trademark, thereby attracting potential ATP customers to the site, only to be scared away from using ATP, and being driven to ATP's competitors.” (Mem. Opp. Renewed Mot. J. Pleadings (“Opp. J. Pleadings”) at 2, July 24, 2017, Docket No. 387.) ATP alleges few specific facts in support of these allegations, and despite two years of trying it has discovered virtually no evidence that they are true. As such, its case quickly deflates into a routine defamation action - one in which most of the statements at issue are not defamatory, and in which the website enjoys immunity against defamation claims related to third-party content.

         Two motions are now before the Court. The first is a motion to dismiss brought by one of the users, Lisa Dukes. (Dukes Mot. to Dismiss, June 28, 2017, Docket No. 357.) The second is a renewed motion for judgment on the pleadings brought by Allnurses. (Renewed Mot. J. Pleadings, June 28, 2017, Docket No. 363.) Because the majority of ATP's claims against Dukes and Allnurses are not plausibly alleged and there is no genuine dispute of material fact as to the others, the Court will grant both motions, converting them to motions for summary judgment as necessary.


         I. THE PARTIES

         Plaintiff East Coast Test Prep LLC is a New Jersey corporation doing business as Achieve Test Prep. (Third Am. Compl. (“Compl.”) at 1, Jan. 24, 2017, Docket No. 268.) Plaintiff Mark Olynyk owns East Coast Test Prep and lives in New Jersey. (Id. ¶¶ 2, 26.)

         Defendant, Inc., is a Minnesota corporation operating the website, which describes itself as “the collective voice of the nursing community.” (Id. ¶¶ 3-4, 39.) Brian Short was the founder, administrator, and president of Allnurses until his death on September 10, 2015. (Id. ¶¶ 5-7.) Defendant David R. Smits is the administrator of Brian Short's estate. (Id. ¶ 7.)

         Defendant Lisa Dukes was a “Senior Moderator” of the forums during the time period at issue and remains an active user under the name Pixie.RN. (Id. ¶¶ 17, 112.) She has posted an average of 111 times per month during her nearly ten years on the forum and authored 32 articles on the Allnurses site. (Id. ¶¶ 157-60).


         Allnurses operates discussion forums where registered users can post comments and “Like” other users' comments. (Compl. ¶¶ 42-45, 152.) The registration page states that signing up “implies full acceptance with our Terms of Service.” (Id. ¶ 88). The site's terms of service (“TOS”) state, among other things, that Allnurses will “promote the idea of lively debate, ” but that users “are not allowed to post libelous information, ” that “[n]o potentially libelous information about specific schools, instructors, or health care facilities/entities should be posted in these forums, ” and that “[a]ny post which is violative of any law . . . will be taken down immediately.” (Id. ¶¶ 88, 98.)

         At issue is a discussion thread in the “Excelsior College Online Nursing” forum, titled “Achieve Test prep…. anyone?” (“the Thread”). (Id. ¶¶ 63-64.) The Thread, which contains an extended discussion about the merits of ATP's services for Excelsior College students, was created in February 2013; by March 2015 it had 33, 875 views and 88 comments, and by October 2016 it had 81, 964 views. (Id. ¶¶ 125-29.)

         Comments[1] by users Pixie.RN, JustBeachyNurse, monkeyhq, duskyjewel, and LadyFree28 are the primary subject of this case. These comments fall into three categories: first, that Excelsior College “warns” students about third-party test prep companies; second, that third-party test prep services, including ATP's, are or will be “redundant” or “obsolete”; and third, that ATP was or is under federal investigation.

         ATP alleges that all five users were compensated by Allnurses for their participation on the forum. (Id. ¶¶ 59, 254-55.) It alleges that Dukes, as Senior Moderator Pixie.RN, was “in charge” of the Thread. (Id. ¶¶ 114-15.) The only specific fact it alleges as to the other four users is their high posting frequency. (See Id. ¶¶ 237-46, 251-53). ATP does point to a TOS provision stating that:

[Allnurses] may, from time to time, request that you and others submit articles or other Content . . . as part of contests or other requests that provide payment to you or give you the chance to be paid, give you recognition or allow you to receive other benefits of publicity.

(Compl. ¶ 99, Ex. A at 47, Docket No. 268-2.) But the remainder of the provision is focused on ensuring that Allnurses, not the user, retains rights in such content. (Id.) Finally, ATP alleges that duskyjewel and monkeyhq were “insiders” that had a “special relationship” with Allnurses. (Compl. ¶¶ 249-50.) It offers no specific facts in support of this allegation other than that two users quit posting after ATP sent Allnurses a demand letter describing their posts as defamatory. (Id. ¶¶ 245-48.)

         A. “Warns”

         The Thread was started on February 12, 2013, by a user soliciting opinions about ATP. (Compl. ¶ 65, Ex. G at 1.) JustBeachyNurse was the first to reply, comparing ATP favorably to competitors but warning of its high cost. (Id. at 2.)

         On the same day the Thread was posted, Dukes (as Pixie.RN) posted: “EC warns students about third-party publishers and test prep companies -- they are not affiliated with EC, nor does EC endorse their use (” (Compl. ¶ 183 (emphasis added).) She did not reference ATP by name. (Id.)

         An Internet Archive capture of the linked page (“the Advisory page”) from January 16, 2013 - less than a month before the “warns” post - shows that it was titled “About Test Preparation Services, ” that it was accessed via a link on the sidebar titled “Exam Preparation Advisory, ” and that it stated:

There are test-preparation companies that will offer to help you study for our examinations. Some may imply a relationship with Excelsior College and/or make claims that their products and services are all that you need to prepare for our examinations.
Excelsior College is not affiliated with any test preparation firm and does not endorse the products or services of these companies. No test preparation vendor is authorized to provide admissions counselling or academic advising services, or to collect any payments, on behalf of Excelsior College. Excelsior College does not send authorized representatives to a student's home.
Depending upon your individual learning style and needs, you may consider using the services and products of a test preparation vendor to help you prepare for an Excelsior College Examination. Some students have found such materials beneficial while others have not. The decision to purchase the services and products of any of these vendors is entirely up to you.
Excelsior College does not review the materials provided by test preparation companies for content or compatibility with Excelsior College Examinations.

(Decl. of John Reddall Supp. Dukes's Mot. to Dismiss (“Reddall Decl.”) ¶ 2, Ex. A at 1, June 28, 2017, Docket No. 360 (emphasis in original).)[2]

         B. “Redundant” and “Obsolete”

         After one response to the “warns” post, the Thread went quiet. It was five months until the next post, and more than two months until the next post after that. (Compl. ¶ 65, Ex. G at 4-5.) The latter was favorable to ATP, sparking a week-long discussion about the merits and costs of test prep companies. (Id. at 4-7.) After another lull, conversation resumed in a similar vein the following February. (Id. at 8-12.)

         After the February exchange, there were no posts in the Thread until August 22, 2014, when user hardworkingrn2 revived it to extoll the virtues of ATP:

ATP's classes provide the structure and visual learning that so many people need to be successful. The classes are taught by RN's whose personal knowledge and experience can be a great support system during this journey. I find that the best investment is always whatever is going to help you be most successful in reaching your goals.

(Id. at 12.) A moderator edited the post to remove a link that violated the TOS. (Id.)

         The next post was by JustBeachyNurse, who wrote: “ATP and similar services will be redundant as of July 1, 2014 [sic] when all challenge exam candidates will be mandated to take the Excelsior online exam prep classes prior to becoming eligible to sit the challenge exams.” (Compl. ¶¶ 134, 139 (emphasis added).) User monkeyhq “Liked” this comment and referenced it in a follow-up, writing that “Test Prep companies for Excelsior Exams will be obsolete by July 1, 2015 . . . it is a total waste of your investment.” (Id. ¶¶ 132, 135-36 (emphasis in original).)

         Dukes, as Pixie.RN, “Liked” monkeyhq's comment. (Id. ¶ 132.) ATP alleges that a “Like” by Senior Moderator Pixie.RN “is tantamount to an endorsement or certification . . . on behalf of Allnurses (which holds itself out as fair and impartial), that what is stated in the post is factually correct.” (Id. ¶ 167.) As such, ATP alleges, “Liking” monkeyhq's post “in effect ratified, restated and republished the statements” therein, and the action “would be interpreted by a reasonable person with ordinary intelligence as Pixie.RN and Allnurses endorsing, approving, and vouching for the truthfulness of the statements contained in the post.” (Id. ¶¶ 169, 174.) ATP concedes that “only one word was posted” but alleges that it represents “her unqualified agreement and approval” of the monkeyhqpost. (Id. ¶ 173.) It even alleges that the “Like” also represents “implied endorsement and approval” of the JustBeachyNurse post referenced in the monkeyhq post. (Id. ¶¶ 175-76.)

         The next post was made on September 4, 2014, by user GRN77, who stated that “Test prep will no longer be available for Nursing classes but will continue to still be available for all Gen eds.” (Compl. ¶ 65, Ex. G at 13.) GRN77 was an ATP employee. (Compl. ¶ 95.) Other posts show that ATP was ending enrollment in nursing classes for new students in response to a change in Excelsior College policy. (Compl. ¶ 65, Ex. G at 14-18.) ATP levies no allegations as to those statements.

         C. “Investigation”

         On September 11, one week after GRN77's post, she[3] reached out to Allnurses to inquire as to whether she could participate in the Thread. (Compl. ¶ 265.) An administrator replied the next day, informing her that participation was “perfectly acceptable . . . as long as it stays within Terms of Service.” (Id. ¶ 266.) ATP president and owner Mark Olynyk had also registered an Allnurses account, using the username learning-is-good. (Id. ¶ 28). His first post in the Thread was on September 11, and it sparked a two-day debate that comprises more than half of the Thread's discussion. (Compl. ¶ 65, Ex. G at 19-40.)

         As part of that back-and-forth debate, LadyFree28 responded to a series of posts about a competing test prep company that was under federal investigation, quoting a post by learning-is-good and responding:

But the discussion is about THIS particular test-prep program that IS being investigated by the federal government and is under a current lawsuit; there are too many forums that have stated the Achieve “deceived” them with their practices, that is the MAIN focus of this discussion, NOT “other test prep companies.”

(Compl. ¶ 187.) The next post was by duskyjewel, quoting a post by learning-is-good and responding: “Sounds like you should be scared. TCN Achieve equals more than one [company under federal investigation].” (Id. ¶ 198.) No defendants dispute that the statements about ATP being under federal investigation were incorrect.

         On September 16, the Thread was closed to new comments. (Compl. ¶ 270.) An administrator told learning-is-good in a private message that it had been closed because “There was a lot of misleading information and instead of trying to clarify, it was just a circular discussion. The thread had multiple reports by members including reports of personal confrontation.” (Id. ¶ 274.) Another ATP employee (under the username onesmallchange) attempted to post comments about ATP on another thread, which were deleted, and the user was eventually banned. (Id. ¶¶ 276-84.)

         D. Other Claims

         ATP alleges “upon information and belief” but without factual support that users were paid to post by Allnurses, its management, and/or the ABC Company defendants - impliedly Allnurses advertisers, including Excelsior. (Id. ¶¶ 237-64.)

         Finally, ATP alleges that an “Open Letter” Allnurses published to its website on September 12, 2016, is defamatory. (Id. ¶¶ 351, 391.) The Open Letter called this action “meritless litigation” and stated that ATP “has demanded that Allnurses turn over any personally identifying information in its possession regarding the users named in the Complaint.” (Id. ¶¶ 354, 357.) ATP alleges that the letter did not “fully, fairly and accurately” describe the case, argues that its litigation is not meritless, and insists that it sought only particular, not “any, ” identifying information.[4] (Id. ¶¶ 356, 359, 363-66.)


         ATP filed this action in New Jersey state court in November 2014, alleging defamation, false light, and tortious interference with prospective economic relations under New Jersey state law, and soon thereafter added libel, breach of contract, consumer fraud, and trademark claims. (Notice of Removal ¶¶ 1-4, May 7, 2015, Docket No. 1.) Allnurses removed the case to the United States District Court for the District of New Jersey based on the Lanham Act trademark claim, and filed a motion to dismiss for lack of personal jurisdiction. (Id. at 1; Allnurses' Mot. to Dismiss at 1-2, June 4, 2015, Docket No. 18.) The New Jersey District Court agreed that it lacked jurisdiction, but transferred the case instead of dismissing it. (Order at 4, 6-9, Aug. 28, 2015, Docket No. 41.)

         ATP commenced discovery upon arrival in Minnesota. (Mot. to Compel, Oct. 23, 2015, Docket No. 56.) Soon thereafter, Allnurses filed a second motion to dismiss, this time asserting that ATP failed to state a claim. (Allnurses' 2d Mot. to Dismiss at 2, Jan. 25, 2016, Docket No. 98.) Because that motion to dismiss was Allnurses' second, and successive Rule 12(b) motions to dismiss are not permitted except to raise a subject matter jurisdiction defense, the Court denied it. E. Coast Test Prep LLC v., Inc. (Sept. 2016 Order), No. 15-3705, 2016 WL 5109137, at *4 (D. Minn. Sept. 19, 2016). Noting that strict adherence to the rule “may appear to be nothing more than annoyance” but was nonetheless mandatory, the Court welcomed Allnurses to file a Rule 12(c) motion for judgment on the pleadings when the pleadings closed. Id. at *2, *4. With discovery well underway and the matter robustly briefed, the Court anticipated that “no additional briefing [would be] necessary.” Id. at *4.

         The next month, Allnurses filed its Answer and Motion for Judgment on the Pleadings. (Ans., Oct. 3, 2016, Docket No. 185; Mot. J. Pleadings, Oct. 4, 2016, Docket No. 186.) The motion was denied because ATP had not yet served the Doe Defendants, nor had they filed answers; as such, the pleadings (though running concurrently with discovery) were not closed. E. Coast Test Prep LLC v., Inc. (Dec. 2016 Order), No. 15-3705, 2016 WL 7383309 (D. Minn. Dec. 20, 2016). On January 24, ATP filed the Third Amended Complaint. (Compl.) ATP also filed a series of motions to compel discovery related to the John Doe users, and litigation over those motions ran into 2017. (See Mot. to Compel, Sept. 8, 2016, Docket No. 167; Mot. to Compel, Sept. 12, 2016, Docket No. 172; Mot. to Compel, Feb. 16, 2017, Docket No. 295.)

         In July 2017, the Magistrate Judge determined that a renewed motion for judgment on the pleadings was timely because no other defendants would be identified or served. (Order Setting Deadlines at 2, July 7, 2017, Docket No. 347.) Jennifer Moeller (duskyjewel), Lisa Dukes (Pixie.RN), and Uhura Russ (LadyFree28) filed motions to dismiss, and Allnurses filed a renewed motion for judgment on the pleadings. (Moeller Mot. to Dismiss, June 26, 2017, Docket No. 350; Dukes Mot. to Dismiss, June 28, 2017, Docket No. 357; Russ Mot. to Dismiss, July 2, 2017, Docket No. 369; Renewed Mot. J. Pleadings, June 28, 2017, Docket No. 363.) The Court granted Moeller's motion, finding that it lacks personal jurisdiction over her. (Order, Sept. 15, 2017, Docket No. 414.) The Magistrate Judge issued, and the Court adopted, a Report and ...

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