Lewis & Lin Obtains $2 Million Arbitration Award in Contract Dispute Regarding Email Marketing Services
In a case heard before the American Arbitration Association, Lewis & Lin obtained for its client Datran Media Corp. (the predecessor to PulsePoint, Inc.) a major victory on Datran’s breach of contract claim.
Under the contract, Datran provided email marketing services to ModernAd Media LLC, with the contract renewing annually unless ModernAd provided notice of termination. ModernAd, however, stopped paying for the services beginning in August 2010, never providing the required notice of termination.
ModernAd asserted various defenses, including unconscionability, violation of New York General Obligations Law § 5-903 (regarding automatically renewing contracts), lack of authority of its Chief Operating Officer, and that an email sent by ModernAd’s CFO served as a termination notice. ModernAd also asserted a counterclaim for over $670,000, claiming that Datran unilaterally changed the pricing on a separate agreement between the parties regarding list management services.
The Arbitrator awarded Datran the full amount of damages sought for the 2010 and 2011 contract years, totaling $1,572,500. The Arbitrator also awarded over $324,000 in attorneys’ fees and expenses, and ordered ModernAd to pay $132,000 in costs associated with the proceedings. With respect to ModernAd’s counterclaim, the Arbitrator denied it in its entirety.
About PulsePoint, Inc.
Datran Media Corp, now known as PulsePoint, Inc. is an award-winning technology and marketing company that leading brands, agencies and publishers depend on to discover, reach and retain their ideal audiences across all digital media channels. PulsePoint’s top-ranked solutions for digital audience measurement, advertising, CRM, commerce and monetization have allowed thousands of companies to execute unparalleled advertising and communications campaigns across social, mobile, the Web and email. PulsePoint is headquartered in New York, with offices across the US and the UK. For more information, please visit www.pulsepoint.com.
About Lewis & Lin, LLC:
Lewis & Lin, LLC is an Internet and Intellectual Property law firm based in Brooklyn, New York. The firm’s highly experienced legal team has helped clients worldwide secure their IP rights, as well as anticipate and resolve a diverse range of Internet and IP issues. Lewis & Lin’s particular expertise lies in Internet transactions and disputes, including domain name licensing and sale agreements, domain name hijacking claims, Uniform Domain Name Dispute Resolution Policy (UDRP) disputes, and Anti-Cybersquatting Consumer Protection Act (ACPA) litigation. The team also expertly handles licensing agreements, website user agreements, service agreements and privacy policies, as well as Internet-related trademark and copyright litigation. For further information, visit www.ilawco.com.
In a broad decision, a state court in Florida has dismissed with prejudice all claims asserted against Lewis & Lin’s client, a leading digital marketing technology company. The case involved the licensure of a proprietary computerized database comprised of names, postal addresses, telephone numbers and associated email addresses of individuals who had agreed to receive marketing communications. Plaintiff alleged that our client unilaterally raised the fees it charged to send out every 1000 emails (the cost per mille, or “CPM” rate).
Plaintiff had asserted claims against our client for violation of the Florida Deceptive and Unfair Trade Practices Act (“FDUTPA”), a so-called “Mini-FTC Act.” Plaintiff sought unspecified damages as well as declaratory and injunctive relief.
Lewis & Lin filed a Motion to Dismiss the Complaint, arguing that the case belonged in binding arbitration pursuant to the licensing agreement, which contained a mandatory arbitration clause—even though that agreement was never signed by the parties. The court agreed with Lewis & Lin’s position, ruling that under Florida precedent, arbitration clauses can be enforced even when they are part of an unsigned agreement if the parties performed under the terms of the contract.
The court also rejected defendant’s argument that FDUPTA claims are not subject to arbitration clauses due to the statute’s policy of protecting Florida consumers. The court ruled that nothing prohibited FDUPTA claims from being decided in an arbitration, and that, in any event, under the terms of the unsigned licensing agreement, it was New York law, not Florida law, that governed.
The court’s dismissal of the case with prejudice effectively means that our client has saved thousands of dollars worth of legal fees to litigate a case in a distant court, and extinguished a potentially expensive claim. David Lin argued the case for the firm.