Court Opinion

ID: 7072996
Source: CourtListenerOpinion
Date Created: 2022-07-24 07:57:53.114659+00
Date Added: 2024-06-11T16:12:39.825281
License: Public Domain

SULLIVAN, Judge,
concurring.
I am unable to agree that the trial court was required to consider whether plaintiffs' use of a flat fee contract as between the publishers on the one hand, and the police and firefighters associations on the other hand, was a fraud upon the public so as to make the "unclean hands" defense available to defendants. In order for such a defense to be appropriate, there must be some relationship between the subject matter of the basic lawsuit and the suspect conduct of plaintiff. Indiana High School Athletic Association v. Raike (1975) 2d Dist., 164 Ind.App. 169, 329 N.E.2d 66.
The existence vel non of arguable fraud upon members of the general public, other than persons being solicited for advertis ing, has no apparent impact or effect upon the competitive use of plaintiffs' advertis ing prospects and defendants' solicitation of advertising from those contacts. It should be noted that the only allegation by defendants with specific regard to an assertion of "unclean hands" is that plaintiffs' "flat fee contracts with the charitable societies and organizations amount to a fraud perpetrated on the public which is the nexus of the interest sought to be protected by Plaintiffs in their injunction lawsuit." Record at 52-53.
I am unable to discern how a contract between the publisher and the charitable organization which allows the publisher to use the name of the charitable organization in return for a fixed sum payment by the publisher to the charity constitutes a fraud upon the general public. Only if the general public is solicited for contributions to the newspaper on behalf of the charity would such representation be fraudulent in nature.
A different question is presented under a scenario under which plaintiffs make misrepresentations to prospective advertisers. That scenario may be present here.
Defendants allege, although not in specific connection with an "unclean hands" assertion, that plaintiffs defraud the public by soliciting money in the names of various organizations which may or may not be "charitable" and that the funds so raised go to the exclusive benefit of plaintiffs to the extent that those funds exceed the flat fee paid to the "charitable" organizations in return for use of the exclusive right to use the name of the "charitable" organization. If the publisher in soliciting advertising represents that a portion of the advertising revenue will directly benefit the charity it would arguably trigger application of the unclean hands doctrine in this case.
There is evidence here which supports a conclusion that in soliciting advertisers to be listed in the publications of Academy and/or Global the telephone solicitations indicated to potential advertisers that plaintiffs represented publications of particular "charitable" organizations. This representation may be considered to have conveyed the implication that the payment for advertising would directly benefit the "charitable" organizations. In this the representation may have been misleading and may have provided a sufficient nexus between the substance of the plaintiffs' lawsuit, e., trade secret violation in solicitation of advertising, and defendants' defense of "unclean hands".
For the reasons stated, I concur in the decision of the majority which implies the *63necessity for the trial court to reconsider the application of defendants' defense of "unclean hands" in light of defendants' pleadings and in light of the evidence admitted or offered by the parties.