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Burford v. Accounting Practice Sales, Inc.

United States Court of Appeals, Seventh Circuit

May 13, 2015

WILLIAM J. BURFORD, Plaintiff-Appellant,
v.
ACCOUNTING PRACTICE SALES, INC. and GARY HOLMES, Defendants-Appellees

Argued December 8, 2014.

Page 583

Appeal from the United States District Court for the Southern District of Illinois. No. 3:12-cv-1212-JPG-SCW -- J. Phil Gilbert, Judge.

For William J. Burford, Plaintiff - Appellant: David Patrick Hall, Attorney, Springfield, IL.

For ACCOUNTING PRACTICE SALES, INCORPORATED, a Texas Corporation, Gary Holmes, Defendants - Appellees: John F. Grady, Attorney, Grady Bell Llp, Chicago, IL.

Before BAUER and HAMILTON, Circuit Judges, and ELLIS, District Judge.[*]

OPINION

Page 584

Hamilton, Circuit Judge.

Plaintiff William J. Burford agreed to market and facilitate the purchase and sale of accounting practices on behalf of defendant Accounting Practice Sales, Inc. (APS) in various territories from Kentucky to Louisiana. The parties initially signed one written contract assigning Louisiana to Burford. They later modified this agreement

Page 585

by orally agreeing that Burford should also cover Alabama, Mississippi, Tennessee, and Kentucky. There is some dispute about the precise terms of the oral agreements and/or modifications, but for purposes of this appeal, we treat the parties' entire relationship as being governed by the terms of the written contract.

APS terminated its contract with Burford. He brought suit in an Illinois state court claiming that APS breached the terms of the contract. He also sought to pierce the corporate veil to hold Gary Holmes, the owner of APS, personally liable for any judgment against APS.

APS removed the case to federal court and moved to dismiss under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. After Burford's complaint survived the motion to dismiss, APS filed a four-count counterclaim. Relevant here is the count of the counterclaim alleging that Burford misappropriated APS's trade name in violation of the Lanham Act, 15 U.S.C. § 1051 et seq. Shortly after APS terminated his contract, Burford started a rival business named " American Accounting Practice Sales." Both sides moved for summary judgment on the opposing side's claims.

APS prevailed on the contract claim on the theory that its contract with Burford was of indefinite duration and was therefore terminable at will. After APS's motion on the conNo. tract claim was granted, but before the district court could consider the counterclaim, APS voluntarily dismissed its counterclaim with prejudice. As the prevailing party on the Lanham Act claim, Burford then sought attorney fees under 15 U.S.C. ยง 1117(a), arguing that APS's pursuit of a meritless Lanham Act claim until right before trial amounted to the sort of abuse of process that entitled Burford to fees. ...


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