Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_12-cv-01920/USCOURTS-azd-2_12-cv-01920-1/pdf.json

Nature of Suit Code: 840
Nature of Suit: Trademark
Cause of Action: 15:1121 Trademark Infringement

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WO 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

Brian G. Doherty, 

Plaintiff, 

vs. 

Certified Financial Planner Board of 

Standards, Inc., 

Defendant. 

No. CV-12-01920-PHX-NVW

ORDER 

Before the Court is Defendant’s Motion to Dismiss Second Amended Complaint 

(Doc. 14), which expressly seeks dismissal under Fed. R. Civ. P. 12(b)(6). 

I. PROCEDURAL BACKGROUND 

On September 11, 2012, Plaintiff filed his initial Complaint, alleging common law 

fraud and violation of his right to due process. On November 13, 2012, the Court 

dismissed the Complaint with leave to amend because it failed to state a claim upon 

which relief can be granted. On November 30, 2012, Plaintiff filed a First Amended 

Complaint, alleging common law fraud, breach of the implied covenant of good faith and 

fair dealing, tortious interference with a business relationship, and illegal business 

conspiracy. On January 3, 2013, the Court dismissed the First Amended Complaint 

without further leave to amend the claims previously alleged, but with leave to amend the 

complaint one further time to characterize Plaintiff’s claim as for breach of contract, 

specifically, Article 4, Section 5.6 of the Disciplinary Rules and Procedures of the Code 

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of Ethics and Professional Responsibility. On January 11, 2013, Plaintiff filed his 

Second Amended Complaint. 

II. LEGAL STANDARD 

On a motion to dismiss under Fed. R. Civ. P. 12(b)(6), all allegations of material 

fact are assumed to be true and construed in the light most favorable to the nonmoving 

party. Cousins v. Lockyer, 568 F.3d 1063, 1067 (9th Cir. 2009). Dismissal under Rule 

12(b)(6) can be based on “the lack of a cognizable legal theory” or “the absence of 

sufficient facts alleged under a cognizable legal theory.” Balistreri v. Pacifica Police 

Dep’t, 901 F.2d 696, 699 (9th Cir. 1990). To avoid dismissal, a complaint need contain 

only “enough facts to state a claim for relief that is plausible on its face.” Bell Atl. Corp. 

v. Twombly, 550 U.S. 544, 570 (2007). The principle that a court accepts as true all of the 

allegations in a complaint does not apply to legal conclusions or conclusory factual 

allegations. Ashcroft v. Iqbal, 566 U.S. 662, 678 (2009). 

Generally, material beyond the pleadings may not be considered in deciding a 

Rule 12(b)(6) motion. However, a court may consider evidence on which the complaint 

necessarily relies if (1) the complaint refers to the document, (2) the document is central 

to the plaintiff’s claim, and (3) no party questions the authenticity of the copy of the 

document submitted to the court. Marder v. Lopez, 450 F.3d 445, 448 (9th Cir. 2006). 

III. FACTS ASSUMED TO BE TRUE 

In 1994, Plaintiff acquired the right to use certain trademarks and service marks 

registered to the Defendant, which allowed him to hold himself out to the public as a 

Certified Financial PlannerTM (“CFP®”). He practiced as a CFP® until March 2011 

when his right to use the marks was suspended. In 1998, a complaint against Plaintiff 

was submitted to Defendant, which resulted in the issuance of a Private Censure to 

Plaintiff. In September 2007, a complaint against Plaintiff was submitted to Defendant 

and to the Florida Bar regarding Plaintiff’s representation of an elderly client as her 

attorney and financial advisor, including making a number of changes to her investments 

and estate planning documents shortly before her death. 

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On January 11, 2011, Defendant directed Plaintiff to show cause why his right to 

use the CFP® marks should not be placed on interim suspension pending the completion 

of Defendant’s investigation. On February 21, 2011, Defendant’s Disciplinary and Ethics 

Commission (“the Commission”) held a show cause hearing. Article 4, Section 5.6 of 

Defendant’s Disciplinary Rules and Procedures states: 

An interim suspension will be issued when the Commission 

determines that the certificant or registrant has failed to 

provide evidence which establishes, by a preponderance of 

the evidence, that the certificant or registrant does not pose an 

immediate threat to the public and that the gravity of the 

nature of the certificant’s or registrant’s conduct does not 

impinge upon the stature and reputation of the marks. 

On March 11, 2011, the Commission issued its decision that Plaintiff failed to 

meet his burden of proof to establish why his certification should not be suspended 

during the pendency of Defendant’s investigation. After considering the evidence 

presented during the show cause hearing, the Commission determined that Plaintiff’s 

conduct did not pose an immediate threat to the public because the main conduct at issue 

involved conduct occurring in 2006 and there were no other recent client issues reported. 

However, the Commission found that the gravity of the nature of Plaintiff’s conduct 

impinged upon the stature and reputation of the CFP® marks. Because Plaintiff failed to 

provide evidence to establish both that he did not pose an immediate threat to the public 

and that the gravity of his conduct does not impinge upon the stature and reputation of the 

marks, the Commission suspended Plaintiff’s right to use the marks pending the outcome 

of Defendant’s investigation. 

The Commission’s March 11, 2011 Interim Suspension Order describes in detail 

the misconduct which caused the Commission to be deeply concerned. On February 19, 

2010, the Florida Bar filed a complaint against Plaintiff in the Supreme Court of Florida, 

and on December 17, 2010, the referee appointed to the matter recommended that 

Plaintiff be disbarred. The referee found that Plaintiff “served simultaneously as an 

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estate planner, trustee and successor trustee, financial products salesperson, personal 

representative and an attorney for a client.” In his response to the Florida Bar 

investigation, Plaintiff admitted that, after his recently widowed client learned in the last 

week of July 2006 that her cancer had returned, he drafted estate planning documents for 

her effecting the following: 

inserting himself as personal representative under a new will; 

inserting himself as executor of [the client’s] estate; inserting 

himself as trustee of [the client’s] trust, replacing a corporate 

trustee that was inserted 3 years prior to the change; and 

creating and inserting himself as successor trustee of two new 

trusts. . . . 

These documents were executed on August 10, 2006, and Plaintiff’s client passed away 

on August 19, 2006. The referee also found that Plaintiff billed and received $7,500 for 

making changes to the estate and $22,000 in advance fees for future trustee services, 

which he never provided because the client’s family’s challenge to his appointment 

caused him to resign as trustee. Rather than refund the $22,000, however, Plaintiff 

credited it toward legal bills the trusts incurred as a result of Plaintiff defending his 

appointment as trustee and filed a claim against the estate to recover the outstanding legal 

fees. The referee also found that in 1997 and 1998, Plaintiff was suspended from the 

practice of law in New Hampshire, Florida, and Massachusetts because he ignored 

several court orders requiring him to return a retainer fee. In 2001, the Massachusetts 

Bar denied Plaintiff reinstatement after the suspension upon finding Plaintiff caused 

several Form U-4s to be filed in which he made material misrepresentations and 

omissions. In addition to his disciplinary history, the referee found as aggravating factors 

that Plaintiff acted with a selfish motive, refused to acknowledge the wrongful nature of 

his misconduct, and had substantial experience in the practice of law. The referee did not 

find any mitigating factors. 

On January 17, 2012, the Supreme Court of Florida approved the referee’s 

recommendation and disbarred Plaintiff effective February 16, 2012. It held that Plaintiff 

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violated ethical rules by failing to disclose his financial interest in certain transactions to 

the client in writing, his actions amounted to egregious misconduct, and his conduct 

created a clear conflict of interest. He advised his client to select various means of estate 

planning and wealth management that would earn him a personal financial benefit, and he 

participated in a business transaction with his client without disclosing his substantial 

interest in the transaction. 

On August 21, 2012, as a result of its investigation, Defendant determined there 

was probable cause to submit a complaint to the Commission alleging violations of 

Defendant’s Code of Ethics and seeking discipline under Defendant’s Disciplinary Rules 

and Procedures. 

IV. ANALYSIS 

Plaintiff’s Second Amended Complaint alleges that a contract was formed when 

Plaintiff acquired the right to use Defendant’s marks and that Defendant breached the 

contract by issuing the interim suspension in violation of Article 4, Section 5.6 of 

Defendant’s Disciplinary Rules and Procedures. As alleged, Section 5.6 required 

Defendant to issue an interim suspension if the Commission determined that Plaintiff 

failed to provide evidence which established, by a preponderance of the evidence, that he 

does not pose an immediate threat to the public and that the gravity of the nature of his 

conduct does not impinge upon the stature and reputation of Defendant’s marks. As 

alleged, Defendant complied with Section 5.6 by issuing an interim suspension because 

the Commission found that Plaintiff did not establish that the gravity of the nature of his 

conduct does not impinge upon the stature and reputation of Defendant’s marks. 

Plaintiff’s Second Amended Complaint further alleges “the hearing panel failed to 

articulate how the plaintiff had engaged in actual conduct that impinged upon the stature 

and reputation of the defendant’s federally registered marks.” However, as summarized 

above, the Commission’s March 11, 2011 Interim Suspension Order articulates in great 

detail Plaintiff’s actual conduct—which he admitted to the Florida Bar—that impinged 

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upon the stature and reputation of Defendant’s marks. The Interim Suspension Order 

also states: 

The Commission is deeply concerned, however, about the 

potential conflicts of interest present in [Plaintiff’s] service to 

his client and [Plaintiff’s] failure to provide any disclosures 

regarding the conflicts of interest. In particular, the 

Commission was concerned about [Plaintiff’s] own admission 

that he did not believe that his outstanding financial 

obligations with Conseco represented a conflict of interest 

when he recommended Conseco products to Mrs. Smith. 

Therefore, Plaintiff’s Second Amended Complaint fails to state a claim upon 

which relief can be granted. 

V. LEAVE TO AMEND 

Although leave to amend should be freely given “when justice so requires,” Fed. 

R. Civ. P. 15(a)(2), the Court has “especially broad” discretion to deny leave to amend 

where the plaintiff already has had one or more opportunities to amend a complaint. 

Ascon Props., Inc. v. Mobil Oil Co., 866 F.2d 1149, 1161 (9th Cir. 1989). “Leave to 

amend need not be given if a complaint, as amended, is subject to dismissal.” Moore v. 

Kayport Package Exp., Inc., 885 F.2d 531, 538 (9th Cir. 1989). Plaintiff already has 

been given two opportunities to amend his complaint and has failed to state a claim upon 

which relief can be granted. No further leave to amend will be granted. 

IT IS THEREFORE ORDERED that Defendant’s Motion to Dismiss Second 

Amended Complaint (Doc. 14) is granted. 

IT IS FURTHER ORDERED that Plaintiff’s Second Amended Complaint (Doc. 

13) is dismissed with prejudice for failure to state a claim upon which relief can be 

granted. 

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IT IS FURTHER ORDERED that the Clerk shall enter judgment dismissing this 

action with prejudice and shall terminate this case. 

Dated this 6th day of March, 2013. 

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