8-189 (1984). Plaintiffs' complaint alleges facts supporting each
element and clearly complies with Rule 8's requirement of a
"short and plain statement of the claim." Fed.R.Civ.P. 8(a).
Other details of plaintiffs' copyright claim may be obtained by
discovery. Defendants' reliance upon Burns v. Rockwood
Distributing Co., 481 F. Supp. 841 (N.D.Ill. 1979), is misplaced.
In Burns, the complaint failed to allege that the plaintiff had
complied with the registration provisions of the Copyright Act.
Id. at 845. Here, plaintiffs specifically allege compliance
with the Act. See Complaint ¶ 6.
State Law Claims
Plaintiffs invoke the Court's jurisdiction over Counts II
through V under 28 U.S.C. § 1338(b) and the doctrine of pendent
jurisdiction. Counts II, III and V allege that defendant Afterman
breached an employment contract; Count IV charges Afterman with
theft of plaintiffs' client mailing lists.
Under 28 U.S.C. § 1338(b), the Court may exercise jurisdiction
over unfair competition claims which are joined with a
"substantial and related" copyright claim. The Seventh Circuit
has outlined two tests for determining whether an unfair
competition claim is "related" for purposes of § 1338(b). First,
the "more liberal view" holds that two claims are related if they
have the same "factual nucleus" required for pendent jurisdiction
under United Mine Workers v. Gibbs, 383 U.S. 715, 86 S.Ct.
1130, 16 L.Ed.2d 218 (1965). Second, the "more restrictive view"
holds that two claims are related only if they "rest upon
substantially identical facts." Powder Power Tool Corp. v.
Powder Actuated Tool Co., 230 F.2d 409, 413 (7th Cir. 1956). The
Seventh Circuit has twice expressly declined to decide which test
should be applied in this Circuit. See Pate Co. v. RPS Corp.,
685 F.2d 1019, 1026 (7th Cir. 1982); Particle Data Laboratories,
Inc. v. Coulter Electronics, Inc., 420 F.2d 1174 (7th Cir.
1969). This Court, however, predicts that the Seventh Circuit
when faced squarely with the issue, will follow the Second
Circuit and adopt the "more liberal view" of § 1338(b). See
Maternally Yours, Inc. v. Your Maternity Shop, 234 F.2d 538 (2d
Cir. 1956); Thompson Tool Co., Inc. v. Rosenbaum, 443 F. Supp. 559
(D.Conn. 1977). Accordingly, the issue in this case is
whether plaintiffs' state law claims and the copyright claim are
derived from a common nucleus of operative facts.
The facts alleged in Counts II through V are as follows: Counts
II and III allege that on May 1, 1981, plaintiffs entered into an
employment contract with defendant Afterman. The agreement
allegedly provided that Afterman would be employed by plaintiffs
as Director of Professional Development. In December, 1982,
Afterman voluntarily terminated the employment contract.
Paragraph 3 of the employment contract prohibited Afterman from
rendering professional services to plaintiffs' clients for a
period of three years following termination of his employment.
Plaintiffs allege that Afterman breached paragraph 3 by rendering
services to plaintiffs' clients and distributing a newsletter
entitled "Accounting & Auditing Update Service" to plaintiffs'
In Count IV of the Complaint, plaintiffs allege that Afterman
stole plaintiffs' mailing lists of clients during his period of
employment. Count V alleges that Afterman breached another
provision of the employment contract by not submitting certain
royalties to plaintiffs as required by the contract.
It is apparent that the facts alleged in Counts II through V of
the Complaint arise from the employment relationship between
plaintiffs and defendant Afterman. Issues relating to the scope
and terms of the employment relationship between Afterman and
plaintiffs will undoubtedly arise at the trial of these Counts.
Regarding the copyright claim, defendants apparently intend to
contest plaintiffs' ownership rights in the material. The
resolution of the ownership issue may turn on the Court's
interpretation of the employment relationship between Afterman
and plaintiffs. For
these reasons, the breach of contract claims in Counts II, III
and V; the theft claim in Count IV; and the copyright claim in
Count I derive from a common nucleus of operative facts. See
United Mine Workers v. Gibbs, 383 U.S. 715, 725, 86 S.Ct. 1130,
1138, 16 L.Ed.2d 218 (1966). Additionally, these claims are such
that plaintiffs would ordinarily expect them to be tried in one
judicial proceeding. Given the important policies of conservation
of judicial energy and the avoidance of multiplicity of
litigation, the Court exercises its discretion, pursuant to
28 U.S.C. § 1338(b) and the doctrine of pendent jurisdiction, to
accept jurisdiction over Counts II through V of plaintiffs'
Complaint. See Rosado v. Wyman, 397 U.S. 397, 405, 90 S.Ct.
1207, 1214, 25 L.Ed.2d 442 (1969); United Mine Workers v.
Gibbs, 383 U.S. 715, 725, 86 S.Ct. 1130, 1138, 16 L.Ed.2d 218
(1966). The Court, however, retains the option of dismissing
Counts II through V without prejudice should plaintiffs'
copyright claim be dismissed before trial. See Buethe v. Britt
Airlines, Inc., 749 F.2d 1235, 1239-1241 (7th Cir. 1984).
For all of the above reasons, defendants' motion to dismiss is
IT IS SO ORDERED.
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