- “Once a Sprint Phone is shipped overseas and becomes operable on other wireless networks, Sprint no longer has a revenue source to recoup the invested subsidy on that phone.”
- The Sprint Phones are resold without original packaging, accessories, or manuals. Furthermore, the hacking and reselling of a Sprint Phone “voids the manufacturer’s warranty on the device.” Sprint alleges these actions deprive it of a means to control the quality of its product and cause harm to its reputation and goodwill.
- Product shortages caused by the defendants’ bulk purchases of Sprint Phones from authorized dealers. Such purchases were unauthorized in Sprint’s view because Sprint earlier sought to prevent bulk purchases by “limiting the number of Sprint Phones an individual may purchase on a daily basis.” The defendants, according to Sprint, sought to circumvent that policy by employing “Runners” to make multiple phone purchases on their behalf. The unauthorized bulk purchases have caused shortages of iPhone 4S® phones for the Sprint network, thereby, Sprint alleges, “substantially harming Sprint and its relationship with dealers and consumers because Sprint is not able to supply dealers with sufficient handsets to satisfy demand from legitimate consumers.”
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Sprint’s complaint details information allegedly acquired through the efforts of its private investigator. Such efforts included a visit to a retail location of defendant Ace Wholesale, Inc. in Taylor, Michigan. The complaint describes that location as “a small office area with a larger office area behind bulletproof glass, and a secure rotating drawer to pass items through to the employees.” The complaint alleges that the investigator was there told that Ace would pay $430 for Sprint iPhone 4S models, and that a day later such a purchase was made, though at a price of $425. Around a week later, according to the complaint, the investigator conducted surveillance outside that location, during which time he observed 67 vehicles visiting the store, with most of those patrons having carried “multiple phone boxes, plastic bags, or cardboard boxes containing cellular telephones.” Sprint describes Exhibit D to its complaint (excerpted above) as including photographs taken during that surveillance activity. Additionally, the complaint describes interactions with Ace Wholesale personnel in Troy, Michigan, and Chicago, Illinois as well as in Atlanta. One of the named defendants is a “Runner” purportedly interviewed by the private investigator outside the Atlanta location.
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Count
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Cause of Action
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I
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Breach of Contract
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II
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Unfair Competition (O.C.G.A. § 23-2-55)
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III
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Tortious Interference with Business Relationships and Prospective Advantage
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IV
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Civil Conspiracy
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V
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Unjust Enrichment
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VI
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Conspiracy to Induce Breach of Contract
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VII
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Common Law Fraud
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VIII
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Fraudulent Misrepresentation
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IX
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Trafficking in Computer Passwords (in violation of Computer Fraud and Abuse Act[1], 18 U.S.C. § 1030(a)(6))
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X
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Unauthorized Access (in violation of Computer Fraud and Abuse Act, 18 U.S.C. § 1030(a)(5)(C))
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XI
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Unauthorized Access with Intent to Defraud (in violation of Computer Fraud and Abuse Act, 18 U.S.C. § 1030(a)(4))
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XII
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Federal Trademark Infringement (15 U.S.C. § 1114)
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XIII
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Federal Common Law Trademark Infringement and False Advertising (15 U.S.C. § 1125(a)(1)(A) and (B))
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XIV
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Contributory Trademark Infringement
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XV
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Deceptive Trade Practices (O.C.G.A. § 10-1-372 et seq.)
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XVI
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Violation of Georgia Computer Systems Protection Act (O.C.G.A. § 16-9-93(a), (b), and (e))
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[1] For a general explanation of the Computer Fraud and Abuse Act, see Vicki M. Luoma and Milton H. Luoma, Jr., “The Computer Fraud and Abuse Act: An Effective Tool for Prosecuting Criminal and Civil Actions in Cyberspace,” The Forum on Public Policy (2008), available in http://www.mobiledia.com/news/110603.html.
Categories: Before 2017
Georgia IP Litigation 