## Facts

- Michael Jordan, through Jump, Inc., granted 23 Food, Inc. an exclusive license to use Jordan’s name and likeness for restaurants in the Chicago metropolitan area.
- 23 Food sublicensed those rights to MJ & Partners Restaurant Limited Partnership, which opened “Michael Jordan’s Restaurant” in Chicago.
- MJ & Partners and 23 Food entered a management arrangement under which Cornerstone Management and Consulting, Inc. provided consulting services; Cornerstone’s chairman, David Zadikoff, allegedly functioned as the restaurant’s de facto chief executive.
- The complaint alleged Zadikoff exercised broad operational and financial authority, including control over hours, menus, pricing, budgets, labor policies, vendor selection, and check-signing.
- Plaintiffs alleged Zadikoff was entrusted with confidential business information, including business plans, marketing strategies, operating procedures, customer-related information, and goodwill associated with “Michael Jordan’s Restaurant.”
- While still managing the restaurant, Zadikoff allegedly helped develop a competing concept, “Restaurant J,” near the Chicago Bulls’ arena and used or disclosed plaintiffs’ confidential information and goodwill in support of that project.
- Plaintiffs alleged Zadikoff publicized or seeded information about the competing project, discussed a Jordan-branded restaurant opportunity with Jordan, and took steps to advance the project (including recording a parking easement at the proposed location).
- MJ & Partners and 23 Food sued asserting federal unfair competition under Lanham Act § 43(a) and multiple Illinois statutory and common-law claims, including breach of fiduciary duty and trade-secret misappropriation under the Illinois Trade Secrets Act.

## Issues

1. Whether the complaint stated a plausible Lanham Act § 43(a) claim based on alleged conduct likely to cause confusion and misappropriate goodwill associated with “Michael Jordan’s Restaurant.”
2. Whether Illinois common-law unfair competition and Illinois consumer-fraud/deceptive-trade-practices claims were adequately pled where they tracked the same allegedly misleading conduct.
3. Whether a breach of fiduciary duty claim was plausibly pled against Zadikoff despite contractual language describing Cornerstone as an “independent consultant.”
4. Whether the complaint sufficiently identified protectable trade secrets and plausible misappropriation under the Illinois Trade Secrets Act, as opposed to non-secret general know-how.

## Decision

- The court applied Rule 12(b)(6) standards, accepting well-pleaded allegations as true and drawing reasonable inferences in plaintiffs’ favor.
- The court granted the motion to dismiss in part and denied it in part, allowing significant claims to proceed beyond the pleadings.
- The Lanham Act § 43(a) claim survived because the complaint plausibly alleged use in commerce, likely confusion, and harm tied to alleged exploitation of the restaurant’s goodwill.
- Related Illinois unfair competition and deceptive practices theories generally survived to the extent they were coextensive with the alleged confusing or misleading conduct supporting the federal claim.
- The breach of fiduciary duty claim survived because plaintiffs plausibly alleged an agency/fiduciary relationship based on Zadikoff’s actual authority, control, and entrusted discretion, notwithstanding “independent consultant” labeling.
- The trade-secret claim survived only in narrowed form; the court allowed allegations tied to genuinely secret, economically valuable information and rejected overbroad or conclusory assertions that resembled general business knowledge.

## Legal Principles

- On a Rule 12(b)(6) motion, the court accepts well-pleaded facts as true and dismisses only where the allegations fail to state a claim for relief.
- Lanham Act § 43(a) permits claims for false designation of origin/unfair competition where allegations support likely confusion and injury tied to misappropriation of goodwill.
- Under Illinois law, whether an agency or fiduciary relationship exists depends on the parties’ actual relationship and conduct; contractual labels such as “independent consultant” are relevant but not dispositive.
- A fiduciary-duty claim may be stated where a defendant is alleged to have been entrusted with discretionary authority and confidential information and to have used that position to pursue competing interests.
- The Illinois Trade Secrets Act requires allegations that the information has economic value from not being generally known and that reasonable efforts were used to maintain secrecy; claims must distinguish protectable secrets from general know-how.

## Conclusion

The court largely refused to end the case at the pleading stage, holding that plaintiffs plausibly alleged Lanham Act unfair competition and an agency-based fiduciary duty notwithstanding “independent consultant” language, while permitting only a narrowed trade-secret theory limited to adequately identified, genuinely secret business information.


MJ & Partners Rest. Ltd. P'ship v. Zadikoff, 10 F. Supp. 2d 922 (N.D. Ill. 1998)