United States District Court, E.D. Missouri, Eastern Division
MEMORANDUM & ORDER
A. ROSS, UNITED STATES DISTRICT JUDGE.
matter is before the Court on its April 27, 2017 Order to
Show Cause why this matter should not be stayed pending the
resolution of the Madison County case and St. Louis County
probate case. (Doc. 59). Plaintiffs and Defendants filed
responses, and the matter is ripe for disposition. For the
reasons set forth below, this matter will be stayed.
lawsuit was brought by Plaintiffs Phyllis Schlafly Revocable
Trust, Eagle Trust Fund, and Eagle Forum Education and Legal
Defense Fund against Defendants Anne Cori, Eunie Smith,
Cathie Adams, Carolyn McLarty, Rosina Kovar, Shirley Curry,
Jane or John Does 1-5, and Eagle Forum. The parties in
this matter are embroiled in numerous lawsuits in this
district and other state and federal courts. The Court has
previously set forth a detailed record of the proceedings
between the parties. Therefore, the Court will only discuss
the cases pertinent to its analysis.
April 22, 2016, the Majority Directors filed an action
against Ed Martin and John Schlafly in the Circuit Court for
the Third Judicial Circuit in Madison County, Illinois,
see Cori v. Martin, No. 2016MR000111 (Ill. Cir. Ct.
Oct. 20, 2016) (“the Madison County case”) (Doc.
22.3). In the first amended complaint,  the Majority
Directors assert breaches of fiduciary duty; aiding and
abetting these breaches of fiduciary duty; civil conspiracy;
equitable action for accounting; action to compel access to
books and records; declaratory judgment that, inter alia, the
actions taken at an April 11, 2016 Board Meeting removing Ed
Martin as president were lawful; and injunctive relief.
April 29, 2016, the Madison County Court entered a TRO that,
inter alia, required John Schlafly and Ed Martin to give the
Majority Directors access to the Eagle Forum headquarters and
all Eagle Forum property. (Doc. 7.10 at 40-42). On October
20, 2016, the Madison County Court entered an amended TRO
suspending John Schlafly from the Eagle Forum Board,
enjoining him from accessing Eagle Forum property, and
granting the Majority Directors temporary sole control of and
possession over all Eagle Forum property (“Madison
County TRO”). That property included the eagleforum.org
domain name and website and the list of 14, 000 active Eagle
Forum members and the contact list of 41, 000 emails used by
Eagle Forum for mass emails.
Eagle Trust Fund and Eagle Forum Education and Legal Defense
Fund removed the action from Madison County to the U.S.
District Court for the Southern District of Illinois based on
the federal claims of trademark and copyright infringement.
(Cori, et al., v. Edward R. Martin, Jr., et al.,
3:17-cv-590-DRH-RJD (S.D.IL. filed June 2, 2017), Doc. 1). On
June 9, 2017, the Majority Directors filed a motion to
remand, asserting that while the amended complaint involved
federal claims, the nature of the claims is ownership of
intellectual property, which they contend is a question of
state law. (Id. at Docs. 19, 22). No ruling has been
made on the motion to remand.
August 7, 2017, Eagle Trust Fund and Eagle Forum Education
and Legal Defense Fund filed a counterclaim against the
Majority Directors. (Id. at Doc. 55). The
counterclaim alleges copyright violations, trademark
infringement under the Lanham Act, 15 U.S.C. §1125, and
violations of the Defend Trade Secrets Act, 18 U.S.C. §
1836, regarding the Eagle Marks;the Phyllis Schlafly
registered word mark; Eagle Design Mark # 1; Eagle Design Mark
# 2;The Phyllis Schlafly Report;
various Eagle website entities, emails services, and web
servers, including EagleForum.org and PhyllisSchlafly.com;
the Schlafly Database; Phyllis Schlafly's name, image,
and likeness; and various publications displayed on
EagleForum.org. Plaintiffs also seek a declaratory judgment
regarding validity and effect of licensure; a declaratory
judgment that Defendants have no legal rights, title, or
interests in the Schlafly Database, derivative mailing lists,
donor lists, data subsets, EagleForum.org, or
PhyllisSchlafly.com; and a permanent injunction enjoining
Defendants from using the above-referenced intellectual
property or accessing, using, or disclosing to third parties
the Schlafly Database.
Louis County probate case
March 20, 2017, Anne Cori filed a Petition in the Probate
Division of the Circuit Court for the County of St. Louis,
Missouri (“St. Louis County probate case”),
seeking to set aside two amendments to the Phyllis Schlafly
Revocable Trust, one dated May 26, 2016 (“May 26
Amendment”) and another dated August 31, 2016
(“August 31 Amendment”). (Doc. 49.6). The May 26
Amendment reduced Anne Cori's share in the trust by all
“lawsuit related costs” incurred by Plaintiffs in
the Madison County lawsuit, or any matter related to that
litigation. The August 31 Amendment transferred all of
Phyllis Schlafly's copyrights, moral rights, intellectual
property rights, and trademark rights, and her interest in
her name, persona and likeness, to the Phyllis Schlafly
Royalty Trust II.
St. Louis County probate case, Cori alleges that when Phyllis
Schlafly signed the May 26 and August 31 Amendments, she
lacked testamentary capacity and was subject to undue
influence by John Schlafly and others (Doc. 49.6 at 9-11).
She also alleges that John Schlafly has breached his
fiduciary duties as sole trustee of the Trust by using Trust
assets to pay legal fees he has incurred in the Madison
County case, the Southern District of Illinois case
(discussed below), and/or this case (Id. at 11-12).
District of Illinois American Eagles case
August 24, 2016, the Majority Directors, on behalf of Eagle
Forum, filed an action against Phyllis Schlafly's
American Eagles (“PSAE”) in the U.S. District
Court for the Southern District of Illinois (“the SDIL
American Eagles case”), Cori v. Phyllis
Schlafly's American Eagles, 3:16-CV-946-DRH-RJD
(S.D. IL Filed August 24, 2016). In the SDIL American Eagles
case, the Majority Directors allege that PSAE has converted
its assets; infringed upon Eagle Forum service marks,
tradenames, and trademarks; engaged in ...