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govinfo:USCOURTS-moed-4_16-cv-01631-15
1
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
EASTERN DIVISION
PHYLLIS SCHLAFLY REVOCABLE )
TRUST, et al., )
)
Plaintiffs, )
)
vs. ) Case No. 4:16-cv-01631-JAR
)
ANNE CORI, et al., )
)
Defendants. )
MEMORANDUM AND ORDER
This matter is before the Court upon the parties’ Phase I motions for summary judgment.
(Doc. Nos. 194, 198, & 201). Phase I is limited to the following four issues: 1) Plaintiffs’
ownership of certain intellectual property and their standing to pursue claims related to that
intellectual property; 2) whether the Schlafly Database qualifies as a trade secret; 3) Defendants’
ongoing use of Plaintiffs’ alleged intellectual property for fundraising purposes; and 4) any
alleged damages. The motions are fully briefed and ready for disposition. For the reasons set
forth below, Plaintiffs’ Motion for Partial Summary Judgment1 and Defendant Eagle Forum’s
Motion for Summary Judgment will be denied. Defendant Anne Cori’s Motion for Summary
Judgment will be granted in part and denied in part as set forth below.
I. Background
The background of this case is set out in detail in the Court’s April 17, 2017 and February
7, 2021 Orders and incorporated by reference herein. (See Doc. Nos. 56 & 168). Briefly, this
1 As discussed below, Plaintiffs’ motion is for summary judgment in name only. The
motion is actually a motion for factual rulings, not judgment in Plaintiffs’ favor for any claims or
defenses.
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case is one of several involving a number of the late Phyllis Schlafly’s organizations and two of
her adult children. Phyllis Schlafly’s daughter, Defendant Anne Cori controls Defendant Eagle
Forum. Phyllis Schlafly’s son, John Schlafly, is the trustee of Plaintiffs Phyllis Schlafly
Revocable Trust (“PSRT”), Eagle Trust Fund (“ETF”) and Eagle Forum Education and Legal
Defense Fund (“EFELDF”). The parties contest the ownership of several pieces of intellectual
property: a database of conservative cause donors compiled by Phyllis Schlafly over the course
of her life (the “Schlafly Database”), five wordmarks and trademarks, and Phyllis Schlafly’s
publicity rights.
Phyllis Schlafly executed a transfer of all her intellectual property rights, copyrights,
moral rights, and trademark rights to PSRT via an assignment on August 31, 2016 (the
“Assignment”). (Doc. No. 202-7). On that same day, Phyllis Schlafly also executed an
amendment (the “Amendment”) to PSRT to insert “Clause Five: Disbursements After Death Of
The Grantor.” (Eagle Forum’s Statement of Uncontroverted Material Facts (Doc. No. 196
(“Eagle Forum’s SUMF”) at ¶ 21). Subsection A of the Amendment states that, upon Phyllis
Schlafly’s death, PSRT shall give all of her “copyrights, moral rights, intellectual property rights,
and trademark rights” to the Phyllis Schlafly Royalty Trust II (the “Royalty Trust”). Id. at ¶ 22.
Phyllis Schlafly’s will devises “all of the rest, residue, and remainder of my property, real and
personal” to PSRT. (Doc. No. 202-8 at 3). However, the estate has not distributed assets yet.
(Eagle Forum’s SUMF at ¶ 36). It remains open in St. Louis County Circuit Court, with claims
pending. Id.
The motions implicate the following claims asserted by all Plaintiffs against both
Defendants: violation of the Defend Trade Secrets Act (“DTSA”) (Count I), trademark
infringement (Count III), violation of the Missouri Uniform Trade Secrets Act (“MUTSA”)
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(Count VI), infringement of publicity rights (Count VIII), and declaratory judgment (Count X).
The motions also implicate PSRT and ETF’s claim for trademark dilution against both
Defendants (Count V).
II. Legal Standard
Summary judgment is appropriate when no genuine issue of material fact exists in the case
and the movant is entitled to judgment as a matter of law. See Celotex Corp. v. Catrett, 477 U.S.
317, 322–23 (1986). The initial burden is placed on the moving party. City of Mt. Pleasant, Iowa
v. Associated Elec. Co-op., Inc., 838 F.2d 268, 273 (8th Cir. 1988). If the record demonstrates that
no genuine issue of fact is in dispute, the burden then shifts to the non-moving party, who must set
forth affirmative evidence and specific facts showing a genuine dispute on that issue. Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 249 (1986). In determining whether summary judgment is
appropriate in a particular case, the evidence must be viewed in the light most favorable to the
nonmoving party. Osborn v. E.F. Hutton & Co., Inc., 853 F.2d 616, 619 (8th Cir. 1988). When
multiple parties move for summary judgment, the Court must analyze each motion individually
and on its own merits. Wermager v. Cormorant Township Bd., 716 F.2d 1211, 1214 (8th Cir.
1983).
III. Defendant Cori’s Motion for Summary Judgment
Defendant Anne Cori moves for partial summary judgment on Plaintiffs’ trade secret
claims (Counts I and IV), infringement of mark claims (Counts III, V, and IX), and the claim
related to Phyllis Schlafly’s publicity rights (Count VIII). Eagle Forum joins Cori in her motion.
(Doc. No. 193). Defendants raise four arguments in favor of summary judgment. First, they
claim EFELDF cannot maintain Counts I and IV for misappropriation of trade secrets because it
is neither an owner nor licensee of the Schlafly Database. Second, they argue the infringement
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claims may only be maintained by the owner of the marks, and as such the claims should be
dismissed to the extent Plaintiffs admit they are mere licensees. Third, Defendants argue ETF
and EFELDF cannot maintain a claim for violation of a right to publicity because they are
licensees. Finally, Defendants argue PSRT has failed to show it suffered damages based on the
claims at issue, and as such it does not have standing.
Plaintiffs allege that either ETF or PSRT own the intellectual property at issue in this
case, and the non-owner Plaintiffs are either licensees or should be treated as owners due to the
organizations’ close relationships. Plaintiffs further argue that PSRT has shown the value of its
intellectual property has been damaged by Defendants’ actions. Cori’s motion will be granted in
part and denied in part.
1. Trade Secret Claims
Defendants claim that EFELDF cannot maintain a claim for misappropriation pursuant to
the DTSA (Count I) or MUTSA (Count IV) because it is not the owner or a licensee of the
Schlafly Database, the trade secret at issue. Plaintiffs agree that EFELDF is neither the owner
nor a direct user of the Schlafly Database; they claim PSRT owns the intellectual property rights
and ETF exclusively possesses and uses the database. However, Plaintiffs nevertheless contend
that EFELDF has rights associated with the Schlafly Database because it is “the organization
most harmed by [Defendants’] wrongful action…. ” (Doc. No. 210 at 7). Plaintiffs further claim
that all three entities “should be treated as an owner or licensee of the Database for standing
purposes” because they function in harmony to advance EFELDF’s ultimate goals. Id. They note
EFELDF pays a portion of ETF’s administrative costs, including the costs of maintaining the
Schlafly Database. EFELDF does not have standing to sue for misappropriation under the DTSA
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because it is neither a licensee nor owner of the Schlafly Database. However, it does have
standing to bring its claim under the MUTSA.
The language of the DTSA limits standing to only owners and licensees. The DTSA
allows “[a]n owner of a trade secret” to bring a civil action. 18 U.S.C. § 1836(b)(1). Owner is
defined as “the person or entity in whom or in which rightful legal or equitable title to, or license
in, the trade secret is reposed.” 18 U.S.C. §1839(4). “To state a DTSA claim, a plaintiff must
show that he is the owner or licensee of the alleged trade secret.” Lamont v. Krane, No. 5:18-
CV-04327-EJD, 2019 WL 2113903, at *3 (N.D. Cal. May 14, 2019). See also Focused, Inc. v.
Sourcing Group, LLC, No. 19-CV-11307-ADB, 2020 WL 1892062, at *4 (D. Mass. Apr. 16,
2020) (Ownership is an essential element of a DTSA claim); AlterG, Inc. v. Boost Treadmills
LLC, 388 F. Supp. 3d 1133, 1144 (N.D. Cal. 2019).
Plaintiffs urge this Court to treat EFELDF as an “owner” of the Schlafly Database
pursuant to the DTSA because of its close relationship with ETF and PSRT; they claim EFELDF
should fictionally be treated as the owner or licensee of the database due to the “harmony” it
shares with the actual owner and licensee. (Doc. No. 210 at 7). The Court will not treat EFELDF
as the owner of the Schlafly Database for the purpose of its DTSA claim. The language of the
DTSA is clear—the cause of action is limited to owners and licensees exclusively. EFELDF is
neither and it cannot maintain a cause of action pursuant to the DTSA.
Unlike the DTSA, the MUTSA contains no language expressly limiting claims to owners
of a trade secret. Defendants urge the Court to conclude that, like the DTSA, the MUTSA limits
its cause of action to owners and licensees. They point out this Court previously stated “[t]he
elements of Plaintiffs’ trade secret misappropriation claims under the DTSA and MUTSA are
essentially the same.” (Doc. No. 27 at 4). However, the Court went on to list the similar
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elements: “(1) the existence of a protectable trade secret; (2) misappropriation of those trade
secrets by the defendant; and (3) damages.” Id. Notably missing from this list is ownership of the
secret.
Furthermore, the Missouri Supreme Court does not list ownership among the elements
required to bring an MUTSA claim. See, Cent. Tr. & Inv. Co. v. Signalpoint Asset Mgmt., LLC,
422 S.W.3d 312, 320 (Mo. 2014) (The elements of misappropriation pursuant to the MUTSA
are: “(1) a trade secret exists, (2) the defendant misappropriated the trade secret, and (3) the
plaintiff is entitled to either damages or injunctive relief.”). Because neither the language of the
MUTSA nor decisions interpreting the statute limit the cause of action to owners and licensees,
this Court will not create such a requirement. Defendants are entitled to summary judgment
against EFELDF on Count I, for misappropriation in violation of the DTSA but not for Count IV,
for misappropriation in violation of the MUTSA.
2. Trademark Claims
Defendants claim they are entitled to partial summary judgment on several of Plaintiffs’
infringement claims: Count III, Count V, and Count IX. Plaintiffs contend that they are either the
owner or nonexclusive licensee of five marks: the EAGLE word mark, PHYLLIS SCHLAFLY
word mark, EAGLE LOGO trademark, EAGLE PIN trademark, and PHYLLIS SCHLAFLY
REPORT word mark (collectively, the “Marks”). In Count III, all Plaintiffs allege Eagle Forum
and Cori infringed on the Marks in violation of the Lanham Act, 15 U.S.C. § 1125(a). In Count
V, PSRT and ETF, but not EFELDF, allege Eagle Forum and Cori diluted the Marks in violation
of the Lanham Act, 15 U.S.C. § 1125(c). In Count IX, all Plaintiffs allege Cori and Eagle Forum
infringed upon the Marks in violation of Missouri common law. Defendants argue that only the
owner or exclusive licensee of the Marks may maintain a claim under § 1125(a), 1125(c), or
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Missouri common law, and therefore they are entitled to summary judgment insofar as Plaintiffs
admit they are not the owner of a Mark.
Plaintiffs claim the ownership of the Marks is as follows:
Mark PSRT ETF EFELDF Other Licensees
“EAGLE” word
mark
Owner Licensee Licensee Eagle Council, Eagle Forum PAC,
and Eagle Forum Collegians
“PHYLLIS
SCHLAFLY”
word mark
Owner Licensee Licensee Phyllis Schlafly Eagles, Phyllis
Schlafly American Eagles, RNC
for Life, and Eagle Forum
Collegians
“EAGLE LOGO”
trademark
No interest Owner Licensee Eagle Council and Eagle Forum
PAC
“EAGLE PIN”
trademark
No interest Owner No
interest
No other licensees
“PHYLLIS
SCHLAFLY
REPORT” word
mark
No interest Owner No
interest
No other licensees
See (Doc. No. 200 (Cori’s Statement of Material Facts) at ¶¶ 16-37).
Plaintiffs admit that the licenses are all unwritten, informal, and non-exclusive. The
licenses may be revoked by the owner of the Mark at will. For the purposes of the motion for
summary judgment, Defendants take Plaintiffs’ allegations as to the ownership and other rights
to the Marks as true.
a. Lanham Act § 1125(a)
Defendants argue that only exclusive licensees may pursue a cause of action under §
1125(a)(1). Plaintiffs respond that non-exclusive licensees may be protected by § 1125(a).
Section 1125 provides a cause of action to “any person who believes that he or she is likely to be
damaged” by the infringement of a mark. 15 U.S.C. § 1125(a)(1). This broad language appears to
grant any plaintiff with Article III standing a cause of action. Lexmark Int’l, Inc. v. Static
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Control Components, Inc., 572 U.S. 118, 129 (2014). However, the Supreme Court held “the
‘unlikelihood that Congress meant to allow all factually injured plaintiffs to recover persuades us
that § 1125(a) should not get such an expansive reading.” Id. (Quoting Holmes v. Securities
Investor Protection Corporation, 503 U.S. 258, 266 (1992). Instead, “the cause of action extends
only to plaintiffs whose interests fall within the zone of interests protected by” the statute. Id.
“[T]o come within the zone of interests in a suit for false advertising under § 1125(a), a plaintiff
must allege an injury to a commercial interest in reputation or sales.” Id. at 131–32. Consumers
may be factually injured by false advertising, but they cannot maintain a claim. Id. at 132.
Standing is not limited to only exclusive licensees. Defendants rely on Kroma Makeup
EU, LLC v. Boldface Licensing + Branding, Inc., 920 F.3d 704, 708 (11th Cir. 2019) in support
of their proposition that only exclusive licensees have a right to sue under § 1125(a). However,
the Kroma court did not determine whether a cause of action pursuant to § 1125(a) is limited to
only owners and exclusive licensees. Instead, the court considered whether the licensing
agreement at issue conferred the right to sue for infringement. Id. at 708. “The plain language of
the agreement demonstrates the parties’ intent for [licensor] to retain all ownership and
enforcement rights. [The plaintiff]—while it may have other rights under the agreement —does
not possess the ability to assert its rights in the mark in this proceeding.” Id. Here, Plaintiffs
have adequately alleged that the owner of the Marks intended to confer enforcement rights to
their licensees.
The Supreme Court in Lexmark found the cause of action was limited to plaintiffs who
may suffer an injury to a commercial interest in reputation or sales. A non-exclusive licensee
may suffer such an injury, and therefore has standing. “[T]he question of ownership is
immaterial to standing under §[1125(a)], since standing may lie with mere users of trademarks.”
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Murphy v. Provident Mut. Life Ins. Co. of Philadelphia, 756 F. Supp. 83, 86 (D. Conn. 1990)
(citing Silverstar Enters. Inc. v. Aday, 537 F.Supp. 236, 241 (S.D.N.Y.1982)). See also Belmora
LLC v. Bayer Consumer Care AG, 819 F.3d 697, 706 (4th Cir. 2016); Coyne’s & Co. v. Enesco,
LLC, 565 F. Supp. 2d 1027, 1043–44 (D. Minn. 2008). As such, all Plaintiffs may pursue a §
1125(a) claim.
b. Lanham Act § 1125(c)
Defendants next claim that only owners of a mark have standing to sue pursuant to §
1125(c). Only PSRT and ETF allege a violation of the Marks pursuant to § 1125(c). By its terms,
§1125(c)(5) infers a cause of action upon only “[t]he owner of a famous mark….” “Nothing in
the Lanham Act suggests that ‘owner’ in § 1125(c)(1) includes by definition anything other than
the actual owner of the famous mark.” STX, Inc. v. Bauer USA, Inc., No. C 96-1140 FMS, 1997
WL 337578, at *4 (N.D. Cal. June 5, 1997). Plaintiffs concede that a non-owner does not have
standing to sue pursuant to § 1125(c). PSRT is not the owner of the EAGLE LOGO, EAGLE
PIN, and PHYLLIS SCHLAFLY REPORT marks and ETF is not the owner of the EAGE and
PHYLLIS SCHLAFLY marks. As such, partial summary judgment in favor of Defendants on
Count V is appropriate as to those marks.
c. Missouri Common Law Infringement and Unfair Competition
Defendants next argue that Missouri common law requires ownership of a mark to a
claim. Plaintiffs respond that “[t]he same facts that support a suit for federal trade mark
infringement support a suit for unfair competition and common law infringement under Missouri
law.” Cmty. of Christ Copyright Corp. v. Devon Park Restoration, 683 F. Supp. 2d 1006, 1016
(W.D. Mo. 2010). Thus, Plaintiffs claim that because they are entitled to bring a §1125(a) claim
under federal law, they may also bring a claim under Missouri law.
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Although the claims are based upon many of the same facts, Missouri courts require
ownership of a mark to bring a claim for infringement. See Sw. Bell Yellow Pages, Inc. v.
Wilkins, 920 S.W.2d 544, 548 (Mo. Ct. App. 1996) (“To state a cause of action for trademark
infringement, the claimant must allege the following: (1) ownership of a distinctive mark; and
(2) use of the similar mark is likely to cause confusion.”). See also Steak n Shake Co. v. Burger
King Corp., 323 F. Supp. 2d 983, 991 (E.D. Mo. 2004); Hallmark Indus., Inc. v. Hallmark
Licensing, LLC, 417 F. Supp. 3d 1180, 1189 (W.D. Mo. 2019) (Under Missouri law, “in order to
maintain claim for common law unfair competition, the plaintiff must own the mark.”). As such,
Defendants are entitled to summary judgment on Count IX against EFELDF as to all of the
Marks, against PSRT as to the Eagle LOGO, EAGLE PIN, and PHYLLIS SCHLAFLY
REPORT marks, and against ETF as to the EAGLE and PHYLLIS SCHLAFLY marks.
3. Publicity Rights
Defendants next claim they are entitled to summary judgment on Count VIII, for
infringement of Phyllis Schlafly’s publicity rights, against ETF and EFELDF. Plaintiffs contend
PSRT owns the rights, and Defendants take this as true for the purposes of summary judgment.
ETF and EFELDF, along with Phyllis Schlafly Eagles, Phyllis Schlafly’s American Eagles, and
Eagle Council are licensees of the publicity rights. The licensees hold unwritten, informal, and
non-exclusive licenses. Defendants contend that “[a] nonexclusive licensee acquires no
proprietary interest in the publicity rights of the licensor and accordingly has no standing to sue
for violation of those rights.” Bi-Rite Enterprises, Inc. v. Button Master, 555 F. Supp. 1188, 1200
(S.D.N.Y. 1983). Plaintiffs agree that a bare licensee does not have standing to bring a claim for
misappropriation of publicity rights. They argue ETF and EFELDF are “co-operative entities
within the Phyllis Schlafly Eagles network” and as such all three Plaintiffs should be recognized
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as holders of a singular exclusive license to use Phyllis Schlafly’s publicity rights. (Doc. No. 210
at 12).
Plaintiffs claim the facts of this case are similar to Polyclad Laminates, Inc. v.
MacDermid, Inc., an unpublished patent case from the District Court for the District of New
Hampshire. No. CIV. 99-162-M, 2001 WL 274722 (D.N.H. Feb. 13, 2001). The plaintiffs,
Polyclad and Alpha, sued MacDermid for patent infringement. Polyclad is the holder of the
patent, and Alpha is the only organization licensed to carry out the patented process. Alpha also
possesses the right to sublicense their right to carry out the patented process to third parties.
MacDermid moved to dismiss Alpha as a party, as Alpha is not the owner of the intellectual
property at issue. The court found that “under certain circumstances, a licensee may possess
sufficient interest in the patent to have standing to sue as a co-plaintiff with the patentee.” Id. at
*2 (quoting Ricoh Co., Ltd. v. Nashua Corp., 947 F. Supp. 21, 23 (D.N.H.1996)). To have
standing, the licensee must have the “promise that others shall be excluded from practicing the
invention.” Id. The court determined that because Alpha possessed the right to sublicense the
patent, it had at least an implicit promise that others will be excluded from using the patent. Id.
Polyclad is not relevant to this case. First, the claim at issue in Polyclad was a federal
patent law claim, while Count VIII is a claim for infringement of the right to publicity under
Missouri law. Second, the decision in Polyclad was not based, as Plaintiffs insist, on the
relationship between Polyclad and Alpha. Instead, standing to sue was based on Alpha’s
exclusive rights under the terms of the license agreement. ETF and EFELDF possess no such
rights. Plaintiffs urge the Court to allow them to bring infringement claims based on their
relationship with the owner of the intellectual property at issue. The Court will not expand the
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category of parties with standing to bring an infringement claim. As such, Cori’s motion for
summary judgment against ETF and EFELDF as to Count VIII will be granted.
4. Damages
Defendants finally argue summary judgment is appropriate against PSRT on Counts I, III,
V, VIII, and IX because PSRT has not shown it suffered damages, as PSRT does not derive
income from the Schlafly Database, the Marks, or Phyllis Schlafly’s publicity rights. As such,
Defendants claim PSRT lacks Article III standing to pursue these claims.
“[S[tanding consists of three elements. The plaintiff must have (1) suffered an injury in
fact, (2) that is fairly traceable to the challenged conduct of the defendant, and (3) that is likely to
be redressed by a favorable judicial decision.” Spokeo, Inc. v. Robins, 578 U.S. 330, 338, 136 S.
Ct. 1540, 1547, 194 L. Ed. 2d 635 (2016)(quoting Lujan v. Defenders of Wildlife, 504 U.S. 555,
560). Contrary to Defendants’ assertion, an injury in fact may be any “invasion of a legally
protected interest,” is not limited to harm to a pecuniary interest. Id. at 339-40. Furthermore,
PSRT does not claim that its damages arise from loss of income, but rather from the diminution
of their property’s value. Plaintiffs claim EFELDF and ETF have suffered loss of supporters and
donors, as well as loss of income, stemming from Defendants’ use of their intellectual property,
and this use reduces the value of the intellectual property. (Doc. No. 210 at 14). These
allegations of damages satisfy the Article III requirement.
IV. Eagle Forum’s Motion for Summary Judgment
Defendant Eagle Forum, joined by Cori, filed a motion for summary judgment on Counts
I and VI of the DTSA and MUTSA respectively. Both claims allege the Defendants used the
Schlafly Database without permission of its owner, PSRT. Defendants also request partial
summary judgment on Count X, for declaratory judgment, insofar as that claim seeks a
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declaration that Defendants have no legal rights, title, or interests in the Schlafly Database or its
derivative mailing lists, donor lists, and data subsets. Defendants argue these claims must be
dismissed because, even taking PSRT’s allegations as to the existence of the Schlafly Database
as true,2 PSRT is not the owner of the Schlafly Database, and Plaintiffs do not have standing to
bring these claims.
The Court will assume for the purposes of this motion that the Schlafly Database, as
described by Plaintiffs, exists. Plaintiffs explain the Schlafly Database is a “compilation of
information regarding donors and supporters of Phyllis Schlafly, compiled by Phyllis Schlafly
over the course of her lifetime.” (Doc. No. 203 at ¶ 1). Prior to August of 2016, when Phyllis
Schlafly executed the Assignment and Amendment, the parties agree the Schlafly Database was
the property of Phyllis Schlafly. There remains a material question of fact as to whether PSRT
owns the Schlafly Database, and as such Defendant Eagle Forum’s motion for summary
judgment will be denied.
In August of 2016, the Assignment transferred Phyllis Schlafly’s “copyrights, moral
rights, intellectual property rights, and trademark rights” to PSRT. (Doc. No. 202-7). Defendants
claim the database is Phyllis Schlafly’s tangible personal property— a collection of lists—and not
a copyright, moral right, intellectual property right, or trademark right. Therefore, they argue the
database did not pass to PSRT via the Assignment. Instead, it became the property of the estate
2 Defendants contend that the Schlafly Database is a concept invented by John Schlafly
when he was removed as President of Eagle Forum in 2016 in order to deny Defendants access
to their donor lists. Defendants claim Phyllis Schlafly’s various organizations had access to their
individual donor lists via a database maintained by ETF. Although the donor lists were
maintained by ETF, Defendants contend neither Phyllis Schlafly nor any of her organizations
thought of the database as a unitary piece of property.
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upon Phyllis Schlafly’s death.3 Plaintiffs allege the Schlafly Database is a trade secret, a type of
intellectual property right,4 and as such it was transferred to PSRT. Defendants respond that if
the Schlafly Database is intellectual property, it passed from PSRT to the Royalty Trust upon
Phyllis Schlafly’s death pursuant to the Amendment.
Defendants have not shown that the Schlafly Database was not transferred to PSRT via
the Assignment. First, there remains a material question of fact as to whether the Schlafly
Database is a trade secret, a type of intellectual property. “A trade secret meets two
qualifications: (a) its owner has taken reasonable measures to keep it secret; and (b) it derives
independent economic value from not being known to or easily ascertainable by another person
who can obtain economic value from it.” Perficient, Inc. v. Munley, No. 4:19-CV-01565, 2019
WL 4247056, at *9 (E.D. Mo. Sept. 5, 2019) (citing 18 U.S.C. § 1839(3); Mo Rev. Stat. §
417.453(4)). Plaintiffs adequately alleged that the Schlafly Database is a trade secret, (Doc. No.
168 at 22), however, whether information constitutes a trade secret is a question of fact. Roeslein
& Assocs., Inc. v. Elgin, No. 4:17 CV 1351 JMB, 2019 WL 195089, at *10 (E.D. Mo. Jan. 15,
2019) (citing Penalty Kick Mgmt, Ltd. v. Coca Cola Co., 318 F.3d 1284, 1291 (11th Cir. 2003)).
A factfinder could reasonably conclude that the Schlafly Database is a trade secret that passed to
PSRT via the Assignment.
Second, the Schlafly Database is intellectual, not tangible, property. Defendants describe
the database as “a collection of ‘information about conservative-cause donors, donation histories,
3 Plaintiffs claim that if the Schlafly Database did become the property of the estate, it then
passed to PSRT via the pour-over clause in Phyllis Schlafly’s will. However, the estate is still
open and has not yet distributed its property. Any property that passed to Phyllis Schlafly’s estate
upon her death is still the property of the estate.
4 Intellectual property is “[a] category of intangible rights protecting commercially
valuable products of the human intellect” which includes trade-secret rights. INTELLECTUAL
PROPERTY, Black’s Law Dictionary (11th ed. 2019).
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and other information obtained through [Phyllis Schlafly’s] personal network and business
dealings.’” (Eagle Forum’s SUMF at ¶ 3) (quoting Doc. No. 138 at ¶ 45) (emphasis added).
Although the Schlafly Database once existed in physical form and could be produced in a
tangible form by printing the donor information, there is no evidence that it currently exists in
physical form. Moreover, as Defendants themselves admit, the Schlafly Database is the
information contained within the database, not any physical lists derived from the information.
The collection of information that comprises the Schlafly Database is intellectual, not tangible
property.5 As such, if the Schlafly Database as described by Plaintiffs exists, it may have passed
to PSRT as intellectual property.6
Next, Defendants claim that if the Schlafly Database passed to PSRT via the Assignment,
it was transferred to the Royalty Trust upon Phyllis Schlafly’s death, pursuant to the
Amendment. The Amendment states that PSRT shall transfer all of Phyllis Schlafly’s
“copyrights, moral rights, intellectual property rights, and trademark rights” to the Royalty Trust
upon her death. (Eagle Forum’s SUMF at ¶ 21). Plaintiffs respond that PSRT has not yet
transferred any assets to the Royalty Trust and it still owns the Schlafly Database. John Schlafly,
the Trustee of PSRT, testified that PSRT is a living trust which was intended to terminate upon
Phyllis Schlafly’s death and distribute its assets to beneficiaries including the Royalty Trust.
5 To the extent Defendants claim the Schlafly Database did not pass via the Assignment to
PSRT because it is Phyllis Schlafly’s personal property, intellectual property is a type of
personal property. “Personal property is defined as any ‘movable or intangible thing that is
subject to ownership and not classified as real property.’” Weicht v. Suburban Newspapers of
Greater St. Louis, Inc., 32 S.W.3d 592, 600 (Mo. Ct. App. 2000)(quoting BLACK’S LAW
DICTIONARY 1233 (7th ed.1999). Intellectual property is an intangible thing, subject to
ownership, and not classified as real property.
6 There remains a question of material fact as to whether Phyllis Schlafly had the capacity
to execute the Assignment. Defendants claim the Schlafly Database never passed to PSRT via
the Assignment because Phyllis Schlafly was not competent when she signed the contract.
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(Doc. No. 202-1 at 58). However, due to the lawsuits PSRT is currently engaged in, it has yet to
terminate and make its distributions.
Defendants respond that the Amendment was mandatory and does not contain exceptions
for litigation. They point out this lawsuit was initiated by PSRT after Phyllis Schlafly’s death, so
PSRT has no reason to delay in transferring the assets. While the Amendment may be
mandatory, Defendants have not shown that it was automatic. Furthermore, Defendants do not
have the right to challenge PSRT’s failure to transfer its assets. See State ex rel. Nixon v.
Hutcherson, 96 S.W.3d 81, 83 (Mo. 2003) (quoting Austin Wakeman Scott & William Franklin
Fratcher, The Law of Trusts vol. IVA, § 364, p. 108 (4th ed. 1989) (“[N]o one except a
beneficiary or one suing on his behalf can maintain suit to enforce the trust.”). Defendants have
provided no evidence that PSRT transferred any property to the Royalty Trust. PSRT is the
owner of any property it acquired via the Assignment. There remain material questions of fact as
to the ownership of the Schlafly Database, so Eagle Forum’s motion for summary judgment will
be denied.
V. Plaintiffs’ Motion for Summary Judgment
Plaintiffs’ Motion for Summary Judgment does not ask the Court to enter judgment in
their favor on any of the twelve remaining counts in their Second Amended Complaint. Instead,
they request the Court to make the following seven factual rulings:
1. PSRT owns the Schlafly Database;
2. PSRT owns the name, image, and likeness of Phyllis Schlafly;
3. ETF owns the “EAGLE LOGO” mark;
4. ETF owns The Phyllis Schlafly Report;
5. Defendants have used Phyllis Schlafly’s name, image, and likeness without right or
permission;
6. Eagle Forum has used The Phyllis Schlafly Report without right or permission; and
7. Eagle Forum has used the “EAGLE LOGO” mark without right or permission.
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“A party may move for summary judgment, identifying each claim or defense—or the
part of each claim or defense—on which summary judgment is sought.” Fed. R. Civ. P. 56.
Defendants point out that Plaintiffs do not tie their requests to any claim or defense, yet Plaintiffs
do not explain why or how their requested relief is appropriate. Plaintiffs’ motion was not
properly raised, and the Court cannot grant it. Summary judgment may be entered only if “the
moving party is entitled to a judgment as a matter of law.” Giordano v. Lee, 434 F.2d 1227, 1230
(8th Cir. 1970) (quoting Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 467, 82
S.Ct. 486, 488, 7 L.Ed.2d 458 (1962)) (emphasis added). Here, Plaintiffs ask not for judgment,
but instead for factual rulings.
The Federal Rules of Civil Procedure set out the process for making factual rulings rather
than entering judgment on a claim or defense. Pursuant to Rule 56(g), a party must first move for
summary judgment. Then, “[i]f the court does not grant all the relief requested by the motion [for
summary judgment], it may enter an order stating any material fact—including an item of
damages or other relief—that is not genuinely in dispute and treating the fact as established in
the case.” Id. “[T]he procedure prescribed in subdivision (g) is designed to be ancillary to a
motion for summary judgment.” 10B Charles Alan Wright & Arthur R. Miller, Federal Practice
and Procedure § 2737 (4th ed. Sept. 2018 update). A court may make factual rulings only after it
has considered a motion for summary judgment and declined to grant complete relief, not
separate from the motion. Plaintiffs’ motion for factual rulings is not accompanied by a motion
for summary judgment, so it must be denied.7 See Arado v. Gen. Fire Extinguisher Corp., 626 F.
Supp. 506, 509 (N.D. Ill. 1985) (denying a motion for independent factual rulings under Rule
7 Defendants’ motions for summary judgment do not allow the Court to consider Plaintiffs’
motion for factual rulings, as the motions must be analyzed individually. Wermager, 716 F.2d at
1214.
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56(d), the predecessor to 56(g), because the “issue-narrowing provision operates only in the
wake of an unsuccessful (and proper) motion under Rule 56(a) or 56(b).”).
Even if Plaintiffs’ motion were properly raised, the Court would exercise its discretion
and decline to make the requested factual rulings. See Fed. R. Civ. P. 56(g) (The court “may
enter an order stating any material fact”) (emphasis added). Ruling on these partial issues of
ownership and use of this property is premature and could lead to jury confusion. Additionally,
Plaintiffs’ requests for rulings often oversimplify the factual and legal questions surrounding the
intellectual property at issue.
For example, Plaintiffs request the Court enter an order finding the Schlafly Database is
owned by PSRT. However, they do not clarify what property rights in the Schlafly Database are
at issue. In their memorandum, Plaintiffs describe the Schlafly Database as “the collection that
was assembled and built over decades of Phyllis Schlafly supporters, donors, fans, subscribers,
members.” (Doc. No. 202 at 2). Do Plaintiffs seek a declaration that PSRT has the right to use
the Paradox database in which this information is contained? Do they seek a declaration that
PSRT owns the intellectual property which comprises the database? Is PSRT’s right to the
Schlafly Database exclusive or non-exclusive?
While it is unclear based on Plaintiffs’ motion what property rights they are seeking, in
their Second Amended Complaint, as well as their response to Cori’s Motion for Partial
Summary Judgment, Plaintiffs identify the Schlafly Database as a trade secret. (Doc. Nos. 138 &
210). The Court cannot determine whether Plaintiffs own a trade secret on a motion for summary
judgment because “[t]he existence…of a trade secret usually is treated as a question of fact. ”
Roeslein, No. 4:17 CV 1351 JMB, 2019 WL 195089, at *10.
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Additionally, much of Plaintiffs’ motion is premised upon their argument that “[n]o
persons or entities apart from the two competing factions have asserted any claims or interest in
any of this intellectual property (in this court or anywhere). Therefore, for each piece of property
at issue, there are only three possible outcomes:” 1) Plaintiffs own the property, 2) Defendants
own the property, or 3) both Plaintiffs and Defendants possess rights to the property. (Doc. No.
223). However, Defendants asserted that either the Royalty Trust or Phyllis Schlafly’s estate own
much of the intellectual property at issue in this matter—including the Schlafly Datab ase and
Phyllis Schlafly’s publicity rights. Plaintiffs claim that their interests are aligned with Phyllis
Schlafly’s estate, but they fail to explain why this alleged “alignment” with a third party
somehow grants them standing to enforce claims on its behalf.
Finally, Plaintiffs make the bizarre argument that Eagle Trust Fund is not, in fact, a trust.
Defendants claim ETF is only entitled to hold “donations and subscriptions paid to the Trustees,”
pursuant to its Declaration of Trust. (Doc. No. 213-25 at 2). Plaintiffs respond that ETF is not a
trust; it is an unincorporated association and therefore may own any property. Specifically,
Plaintiffs claim ETF owns the EAGLE LOGO mark and the Phyllis Schlafly Report. This
argument is unsupported by legal citations and contradicts both the Second Amended Complaint
and the documents establishing ETF as a trust. In the Second Amended Complaint, Plaintiffs
explain ETF was settled under Illinois Law by Phyllis Schlafly and identify the organization as a
“Trust.” (Doc. No. 138 at 6). Furthermore, ETF was established via a Declaration of Trust as a
“not-for-profit Trust.” (Doc. No. 213-25 at 2).
Plaintiffs’ motion for summary judgment is not properly raised. The Court cannot make
factual rulings without first ruling on a motion for judgment on a claim or defense. Moreover,
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even if the motion were properly raised, the Court would decline to exercise its discretion to
make factual rulings.
VI. Conclusion
Cori has shown that the parties do not have sufficient rights in the intellectual property at
issue to maintain certain claims. Summary judgment in favor of Defendants is warranted against
EFELDF on Counts I, VIII, and IX. Partial summary judgment in favor of Defendants against
PSRT as to the EAGLE LOGO, EAGLE PIN, and PHYLLIS SCHLAFLY REPORT marks in
Counts V and IX is also appropriate. Finally, summary judgment against ETF on Count VIII and
partial judgment as to the EAGLE and PHYLLIS SCHLAFLY marks in Counts V and IX in
favor of Defendants is warranted. Material questions of fact as to the ownership of the
intellectual property at issue in this case remain, so the rest of Cori’s motion for summary
judgment and Eagle Forum’s motion for summary judgment must be denied. Finally, Plaintiffs’
motion is not properly raised, and the Court cannot consider it.
Accordingly
IT IS HEREBY ORDERED that Defendant Anne Cori’s Motion for Summary
Judgment [198] is GRANTED in part and DENIED in part, as set forth above.
IT IS FURTHER ORDERED that Defendant Eagle Forum’s Motion for Summary
Judgment [194] is DENIED.
IT IS FURTHER ORDERED that Plaintiffs’ Motion for Summary Judgment [201] is
DENIED.
IT IS FURTHER ORDERED that the parties shall submit a joint proposed scheduling
plan within fourteen days.
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Dated this 28th day of March, 2022.
JOHN A. ROSS
UNITED STATES DISTRICT JUDGE
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