1507829v2

IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

TOLEDO MACK SALES & }

SERVICE, INC., }

}

Plaintiff, } Civil Action No. 

} 2:02-CV-04373-RLB

}

v. }

} JURY TRIAL DEMANDED

MACK TRUCKS, INC., }

}

Defendant. }

MACK TRUCKS, INC., }

}

Plaintiff, }

}

v. }

}

TOLEDO MACK SALES & } JURY TRIAL DEMANDED

SERVICE, INC., and }

}

PAI INDUSTRIES, INC., }

950 Northbrook Parkway }

Suwanee, Georgia, }

}

Defendants. }

COUNTERCLAIM DEFENDANT PAI INDUSTRIES, INC.’S 

MEMORANDUM OF LAW IN SUPPORT OF ITS MOTION TO DISMISS

COUNT V OF DEFENDANT/COUNTERCLAIM PLAINTIFF

MACK TRUCKS, INC.’s COUNTERCLAIM

Counterclaim Defendant PAI Industries, Inc. (“PAI”) respectfully moves the Court,

pursuant to Fed. R. Civ. P. 12(b)(6), to dismiss Count V of Defendant/Counterclaim Plaintiff

Mack Trucks, Inc.’s (“Mack”) Counterclaim for failure to state a claim upon which relief may be 

granted.

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I. BACKGROUND AND STATEMENT OF FACTS

In July 2002, Toledo Mack Sales and Service, Inc. (“Toledo Mack”) filed suit against

Mack in this Court, alleging, inter alia, claims of violation of the Ohio Motor Vehicle Dealer

laws, violation of the Michigan Franchise Investment Law, price discrimination, violation of

Section I of the Sherman Act, tortious interference with existing and prospective business

relations, breach of contact, and breach of the implied covenant of good faith and fair dealing. 

Mack answered and asserted a counterclaim against Toledo Mack. Mack also joined PAI as a

defendant in counterclaim, alleging: (1) misappropriation of trade secrets and confidential

business information; (2) copyright infringement; (3) tortious interference with existing

contractual relations; (4) fraudulent inducement; and (5) civil conspiracy. (Mack’s Answer and

Counterclaims, Counts I, II, IV, V and VI). Each of these claims is based on PAI’s alleged

“theft” of Mack’s MACSPEC 2001 system, a software package consisting of a database that

catalogs parts for Mack truck models, and software enabling users to search the database. 

In Count V of its Counterclaim, Mack purports to assert a claim for fraudulent and

intentional misrepresentation against PAI. In support of its claim, Mack alleges that, when PAI

contacted GGS, Mack’s contractor for the administration of the MACSPEC 2001 system, to

obtain technical support for PAI’s leased copy of the system (i.e. to obtain a “replacement disk”) 

PAI’s representative used a false name, “Nancy’s Trucking.” Mack alleges that PAI used the

alias to cause Mack to believe that PAI was an authorized dealer, and to fraudulently induce

Mack to send PAI a replacement disk for its MACSPEC 2001 system. 

Count V fails to state a claim for fraud. By its own admission, at the time of PAI’s

alleged misrepresentation, PAI had already obtained a copy of the MACSPEC 2001 system from 

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Mack, through Toledo Mack, and Mack was already suffering damages. Therefore, PAI’s

actions, even as alleged by Mack, do not support a separate claim for fraud.

II. ARGUMENT AND CITATION OF AUTHORITY

Pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, a motion to dismiss

may be granted “when ‘it is clear that no relief could be granted under any set of facts that could 

be proved consistent with the allegations.’” Harper v. American Red Cross Blood Servs., PennJersey Region, 153 F. Supp. 2d 719, 720 (E.D. Pa. 2001) (quoting Hishon v. King & Spalding, 

467 U.S. 69, 73 (1984)). In considering a motion for failure to state a claim, “[t]he Court must

accept all well-pleaded allegations as true and construe the complaint in a light most favorable to 

the plaintiff [to determine] whether, under any reasonable reading of the pleadings, the plaintiff 

may be entitled to relief.” Id. See also Colburn v. Upper Darby Township, 838 F.2d 663, 665-

66 (3d Cir. 1988). Applying this standard to this case, Mack’s fraudulent inducement claim must 

be dismissed.

The sole act alleged by Mack to have been fraudulent is PAI’s use of the alias “Nancy’s

Trucking” when it called Mack’s contractor, GGS, for technical support. (Counterclaim, ¶¶ 69-

71). Even according to the facts as alleged by Mack, however, PAI had already obtained its copy 

of the MACSPEC 2001 system at the time it called GGS. According to the counterclaim, PAI

simply used the false name to conceal that it had acquired the system. Perhaps, construing the

allegations in the light most favorable to Mack, PAI’s act could be construed as an effort to

conceal its misappropriation of Mack’s trade secrets or infringement of Mack’s copyright. 

However, such concealment does not constitute a separate tort upon which Mack is entitled to

relief. 

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Indeed, Mack does not even allege that PAI’s misrepresentation, in and of itself, caused

Mack any damages. See Volunteer Firemen’s Ins. Servs., Inc. v. Cigna Property & Cas. Ins.

Agency, 693 A.2d 1330, 1340 (Pa. Super. Ct. 1997) (“An action for fraud consists of proof, by

clear, precise and convincing evidence of the following elements: . . . (5) damages to the

recipient as the proximate result.”). Rather, Mack merely alleges that “[a]s a direct and

proximate result of PAI’s acquisition of the MACSPEC 2001 system, Mack continues to lose the

competitive advantages it derived from its investment in the development of the MACSPEC

2001 . . . .” (Counterclaim, ¶ 75) (emphasis added). There is no allegation that PAI “acquired

the MACSPEC 2001 system” as a result of any misrepresentation to Mack. Accordingly,

Mack’s claim for fraudulent inducement must be dismissed.

CONCLUSION

As shown, the allegations in Count V of the Counterclaim – even construed most

favorably to Mack – fail to state a separate claim for fraudulent inducement. Therefore, PAI

respectfully requests that its motion be granted, and that Count V of Mack’s Counterclaim

against it be dismissed.

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This 16th day of September, 2002.

Respectfully submitted,

WIGGIN & DANA LLP

By:

Joseph Schumacher

Kimberly S. Toomey

Quaker Park 

1001 Hector Street

Conshohocken, Pennsylvania 19428

(610) 834-2400

(610) 834-3055 fax

Attorney for Counterclaim

Defendant PAI Industries, Inc.

OF COUNSEL

Stephen M. Dorvee 

Ga. Bar 226989

Scott E. Taylor

Ga. Bar 785596

Ashley M. Steiner

Ga. Bar 678211

ARNALL GOLDEN GREGORY LLP

2800 One Atlantic Center

1201 West Peachtree Street

Atlanta, Georgia 30309

(404) 873-8500

(404) 873-8501 fax

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CERTIFICATE OF SERVICE

I hereby certify that, on September 16, 2002 I served the foregoing COUNTERCLAIM 

DEFENDANT PAI INDUSTRIES, INC.’S MEMORANDUM OF LAW IN SUPPORT OF

ITS MOTION TO DISMISS COUNT V OF DEFENDANT/COUNTERCLAIM

PLAINTIFF MACK TRUCKS, INC.’S COUNTERCLAIM by First Class U.S. mail to:

Jon A. Baughman

Jeremy Heep

Barak A. Bassman

Pepper Hamilton LLP

3000 Two Logan Square

18th and Arch Streets

Philadelphia, PA 19103-2799

Wayne A. Mack

J. Manly Parks

Duane Morris LLP

One Liberty Place

Philadelphia, PA 19103-7396

_____________________________

Kimberly S. Toomey

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