Motion to dismiss denied, class certified

Tomthecoinguy

I just received a call from my lawyer in the HPA case I filled against the Westminster Mint. Many of you, like me, have been anxiously awaiting the judge's ruling. If you need a refresher on the issues, here is a link to the original thread that I posted.

http://forums.collectors.com/messageview.cfm?catid=26&threadid=924970

The judge denied the motion to dismiss on all three counts. So this was a ruling in my favor, and the case moves on to the next phase. Previously the defendant's stipulated to class certification so now we go on to class notification, and discovery. Of course settlement talks can happen at any point along the way.

It is important to keep in mind that this win is just a very early stage in the process. As the judge stated, "To overcome a motion to dismiss, a pleading must contain “enough facts to state a claim to relief that is plausible on its face.”

I started the original thread because I figure the case would be of interest to people on this board. I am glad I did, because it opened a lot of good discussion. I hope you understand that I will just be sticking to the facts in my posts, since the case is still in progress and I am a named plaintiff. Similarly, I will not be answering any factual questions that I might reasonably be asked in the discovery process. When the case is fully resolved, I hope to have a thread where I answer everyone's questions.



In the previous thread, there was a lot of discussions if the silver rounds in questions were "imitation Numismatic Items." Here is a section from todays ruling that addresses that issue. The bolding in the below quote was mine, I want to highlight the sections most relevant to the discussions in the previous thread.


B. “Imitation Numismatic Items”

Defendants assert that the American Silver Eagle and Canadian Timber Wolf rounds do not quality as “imitation numismatic items” within the purview of the HPA. (Id.). They claim that the Silver Eagle and Timber Wolf rounds are not exact replicas of any pre-existing currency and contend that there are “notable, striking, and significant design differences” between the rounds and the actual legal tender. (Defs.’ Mem. in Support of Motion to Dismiss at 3 [Doc. No. 21].) For example, Defendants note some differences with regard to each round’s size, weight, silver content, and graphic artistry relative to the original numismatic items detailed in the Complaint. (Id. at 3-4.) Because of these dissimilarities, Defendants claim that “no reasonable and unsuspecting purchaser could assume the rounds were original coins.” (Id. at 1.) Accordingly, Defendants argue that the rounds are not “imitation numismatic items” and need not be marked with the word “COPY,” as required by the HPA. (Defs.’ Motion to Dismiss [Doc. No. 19].)

The Court disagrees with Defendants’ narrow application of the HPA. See Demarco, 229 F.R.D. at 78 (discussing that under the HPA “imitation numismatic items” need not be exact reproductions of existing coins). Specifically, under the HPA, the term “imitation numismatic item” includes any item that “purports to be, but in fact is not” an original numismatic item, in addition to those items that are wholly “reproduction and counterfeits.” 16 C.F.R. § 304.1(d). In denying a motion to dismiss on similar grounds, the court in Demarco found that the commemorative Freedom Tower Silver Dollar (“FTSD”) coin, depicting the September 11th attacks, was an “imitation numismatic item” even though the coin did not resemble any previously minted or presently circulated United States coinage. 229 F.R.D. at 78. The FTSD was inscribed with the phrases “IN GOD WE TRUST” and “One Dollar.” Such phrases are required by law to appear on all United States legal tender. Id. The court concluded that “[while the] characteristics of the FTSD might not fool a sophisticated coin collector . . . they could lead an unsophisticated purchaser to believe the FTSD was indeed legal tender issued by the Government.” Id. Therefore the court in Demarco found that the complaint sufficiently alleged that the FTSD purported to be “coinage used in exchange” and was subject to the regulations of the HPA. Id.

As in Demarco, Plaintiff here has alleged plausible violations of the HPA. The Complaint asserts that the Silver Eagle and Timber Wolf rounds are “imitation numismatic items” within the definition of the HPA. (Comp. ¶ 37 [Doc. No. 1-1].) The Complaint lists specific and numerous characteristics of each round that mimic characteristics of the authentic, government-minted coinage. (Id. ¶¶ 38-48). Among other similarities, the Silver Eagle and Timber Wolf rounds share artistry, written mottos, and markings in the exact locations as the original numismatic items to which they are compared in the Complaint. (Id.) Plaintiff supports these allegations with detailed photographs of both the Defendants’ rounds and the authentic legal coinage. (Plaintiff Exhibits A-F [Doc. No. 1-1].) Just as the court noted in Demarco, 229 F.R.D. at 78, here, some of the inscriptions found on the Defendants’ Silver Eagle round are required by law to appear on all United States’ coinage. Further, the Complaint alleges that the American Eagle and Timber Wolf rounds were not marked “COPY” as required under the HPA. (Comp. ¶¶ 43, 51 [Doc. No. 1-1].) Drawing all reasonable inferences in favor of Plaintiff, the allegations in the Complaint concerning “imitation numismatic items” sufficiently support a claim under the HPA.

SoCalBigMark

Why not post this in the original thread?

LanceNewmanOCC

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ty for posting an update. i've spent a few minutes thinking on such subject(s) and where the line(s) is/are drawn.

also, the law can nail you but i for sure love the vernacular.

while i don't know if the defendants in this case deserve what may happen, we certainly need precedents imo as a lot of this stuff is simply going too far aka getting too close. it may not seem like it to us esteemed elitists but to average joe, the mimicry of many of the items can cause quite a mess. (emotional/financial etc not to mention tons of extra work for dealers at shows and b&m)

7 years ago, i'm not sure i'd know the different on most of the items. truth.

LINKAFIED
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Tomthecoinguy

<< <i>Why not post this in the original thread? >>



I went back and forth on creating a new thread vs posting in old. Since the other was so old, and so long, I thought a new thread might be easier for someone that wants to quickly see what the judge ruled. If this post generates a lot of posts like the old one, it might be hard for someone to find my post about the judges ruling if it ends up in the middle of a 300+ post tread. This way it is at the top of a new thread.

Wolf359

I'm not sure why anyone would trust the courts these days. Maybe it's just me.

TonerGuy

This is very bad news for all of those companies that manufacturer fantasy pieces to look like exact US coinage.

The last paragraph you posted is the most telling... Thats the meat of the decision and the application of HPA to this issue.

Good job and do not settle easily or with confidentiality. You are setting a precedent to protect the industry from this type of fraudulent behavior.

Keep the light shining on it. Good luck and well done !!!

keets

this decision ranks right up there with the McDonald's coffee verdict and I can only imagine how the rest of the World is laughing at us. we allow our courts to be tied up with this while they do nothing about the actual counterfeits rushing in from China and the fake slabs etc. that corrupt the Hobby. I am sure my opinion is in the minority and that I will be scorned by the OP and the regular group of forum hounds, so be it, but this is really a disgusting waste of time and resources.

have a nice day.

mrdq

I'm curious what you think "the courts" could do regarding Chinese copies? A U.S. Court declaring something illegal means nothing to the rest of the world. Enforcement is the key I think and no one cares enough about rich people collecting bogus coins.

I know most of us here aren't "rich" but if you're spending hundreds or thousands on coins you're surely in the upper end on the global food chain.

These people are in the U.S. and the lawsuit is between U.S. citizens and businesses so let it run it's course. I've been accused of silly things during the course of my business career and the courts are there to help find the truth, or get as close as possible to the truth.