Case: 1:22-cv-03239 Document #: 98 Filed: 05/10/24 Page 1 of 25 PageID #:1854
`
`IN THE UNITED STATES DISTRICT COURT
`FOR THE NORTHERN DISTRICT OF ILLINOIS
`EASTERN DIVISION
`
`NEXTPULSE, LLC,
` Plaintiff,
`
`Civil Action No. 1:22-CV-03239
`
`v.
`
`Judge Nancy L. Maldonado
`
`LIFE FITNESS, LLC,
`
` Defendant.
`
`JURY TRIAL DEMANDED
`
`DEFENDANT LIFE FITNESS’S ANSWER AND AFFIRMATIVE DEFENSES TO
`NEXTPULSE, LLC’S AMENDED COMPLAINT (CORRECTED)
`
`Defendant Life Fitness, LLC (“Defendant” or “Life Fitness”), by and through their
`
`undersigned counsel, hereby submit its answer and affirmative defenses to Plaintiff Nextpulse,
`
`LLC’s (“Plaintiff” or “Nextpulse”) Amended Complaint (Corrected).
`
`THE PARTIES
`
`NEXTPULSE, LLC (“NP”) is a Delaware limited liability company with its
`1.
`principal place of business located in the Town of Atherton, County of San Mateo, and State of
`California.
`
`ANSWER: Life Fitness is without knowledge or information sufficient to form a belief
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`as to the truth of the allegations of this paragraph, and therefore denies them.
`
`NP is informed and believes, and thereon alleges, that Defendant LIFE FITNESS,
`2.
`LLC (“LF”) is a Delaware limited liability company registered to do business in Illinois, with its
`principal place of business located in the City of Franklin Park, County of Cook, and State of
`Illinois.
`
`ANSWER: Admitted.
`
`

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`NP is informed and believes, and thereon alleges, that Defendant KPS Capital
`3.
`Partners, LP (“KPS”) is a New York limited partnership, with its principal place of business
`located in New York.
`
`ANSWER: The allegations of this paragraph require no response as the Court dismissed
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`all claims against KPS. Dkt. No. 89.
`
`NP is informed and believes, and thereon alleges, that Defendant Lumos
`4.
`International Holdings, B.V. (“Lumos”) is a private limited liability company and an affiliate of
`KPS, with its principal place of business in Amsterdam. LF, KPS and Lumos are collectively
`referred to herein as “Defendants.”
`
`ANSWER: The allegations of this paragraph require no response as the Court dismissed
`
`all claims against Lumos. Dkt. No. 89.
`
`JURISDICTION AND VENUE
`
`This Court has subject matter jurisdiction over the first claim alleged herein
`5.
`(copyright infringement under the federal copyright laws) pursuant to 17 U.S.C. Section 501 and
`28 U.S.C. Sections 1331 and 1338(a) in that said claim arises under the laws of the United States.
`
`ANSWER: Life Fitness admits that the Amended Complaint purports to be an action
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`for copyright infringement. Life Fitness denies the remaining allegations in this paragraph.
`
`This Court has subject matter jurisdiction over the second claim alleged herein
`6.
`(tortious interference with contractual rights) pursuant to 28 U.S.C. Section 1332, because there is
`complete diversity between the parties and the amount in controversy exceeds $75,000, and
`pursuant to 28 U.S.C. Section 1367, because the claim is related to other claims in this action that
`are within the Court’s original jurisdiction.
`
`ANSWER: The allegations of this paragraph require no response as the Court dismissed
`
`all of Nextpulse’s tortious interference claims. Dkt. No. 89.
`
`This Court has subject matter jurisdiction over the third claim alleged herein (trade
`7.
`secret misappropriation under the federal Defend Trade Secrets Act) pursuant to 28 U.S.C.
`Sections 1836-39 et seq. and 28 U.S.C. Section 1331.
`
`ANSWER: Life Fitness admits that the Amended Complaint purports to be an action
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`for trade secret misappropriation. Life Fitness denies the remaining allegations in this paragraph.
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`2
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`Case: 1:22-cv-03239 Document #: 98 Filed: 05/10/24 Page 3 of 25 PageID #:1856
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`NP’s claims arise in whole or in part in this District. LF operates in, resides in,
`8.
`and/or exists in this District. Accordingly, pursuant to 28 U.S.C. Sections 1391(b) and 1400(a),
`venue is proper in this District.
`
`ANSWER: Life Fitness admits that it resides and operates in this District. Life Fitness
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`denies the remaining allegations in this paragraph.
`
`SUMMARY OF THE FACTS
`
`Netpulse, Inc. (“Netpulse”), the predecessor of NP, was a Delaware corporation
`9.
`duly licensed and qualified to do business in California and had its principal place of business in
`San Francisco, California. Netpulse developed software applications, content delivery systems,
`and network-based services related to exercise equipment.
`
`ANSWER: Life Fitness is without knowledge or information sufficient to form a belief
`
`as to the truth of the allegations of this paragraph, and therefore denies them.
`
`In 2011, Virtual Active, Inc. (“VA”) was a San Francisco based media and
`10.
`technology company that developed video content specifically targeted to entertain and motivate
`cardio fitness equipment users (“VA Content”).
`
`ANSWER: Life Fitness is without knowledge or information sufficient to form a belief
`
`as to the truth of the allegations of this paragraph, and therefore denies them.
`
`In 2011, Life Fitness was a division of Brunswick Corporation (“BC”). BC’s Life
`11.
`Fitness division designed, manufactured, marketed, and sold fitness equipment products, including
`cardio exercise equipment such as treadmills, exercise bicycles, and elliptical machines.
`
`ANSWER: Admitted that the Life Fitness Division of Brunswick Corporation (“Life
`
`Fitness Division”) designed, manufactured, marketed, and sold fitness equipment in 2011. Denied
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`as to the remainder of this paragraph.
`
`In 2011, BC’s Life Fitness division and Netpulse each made separate offers to
`12.
`purchase VA. Netpulse’s offer was accepted and in October of 2011, Netpulse acquired VA,
`including its intellectual property rights to the VA Content, such as copyrights to its video library.
`
`ANSWER: Life Fitness admits that the Life Fitness Division made an offer to purchase
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`VA. Life Fitness is without knowledge or information sufficient to form a belief as to the truth of
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`the remainder of the allegations of this paragraph, and therefore denies them.
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`Case: 1:22-cv-03239 Document #: 98 Filed: 05/10/24 Page 4 of 25 PageID #:1857
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`Netpulse developed an entertainment and advertising platform for exercise
`13.
`equipment and wanted to partner with BC, the largest manufacturer of commercial health club
`equipment, to incorporate Netpulse’s platform on BC’s Life Fitness consoles (i.e., screens)
`featured on BC’s cardio fitness equipment products (e.g., its treadmills, exercise bicycles, and
`elliptical machines). Based on Netpulse’s prior experience selling advertising on consoles, the
`volume of BC’s cardio equipment sales, and the significant usage by health club members of cardio
`exercise equipment, Netpulse knew that its advertising platform would generate significant
`recurring income for Netpulse. Knowing that BC had wanted the VA Content for its exercise
`consoles, Netpulse offered to license the VA Content to BC in exchange for BC’s agreement to
`put Netpulse’s entertainment and advertising platform on BC’s Life Fitness consoles.
`
`ANSWER: Life Fitness admits that Netpulse offered to license the video content from
`
`Virtual Active, Inc. (“VA Content”) to Life Fitness Division. Life Fitness is without knowledge
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`or information sufficient to form a belief as to the truth of the remainder of the allegations of this
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`paragraph, and therefore denies them.
`
`Netpulse and BC entered into a written Customized Development and Software
`14.
`Licensing Agreement, effective December 12, 2011, and several amendments thereto, specifically
`a First Amendment, effective March 12, 2012, a Second Amendment, effective September 26,
`2012, and a Third Amendment, effective February 13, 2014. Netpulse and BC were each required
`to perform various obligations under the Customized Development and Software Licensing
`Agreement and the amendments thereto (collectively, “SLA”).
`
`ANSWER: Life Fitness admits that Netpulse and Life Fitness Division entered into a
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`written Customized Development and Software Licensing agreement and subsequent amendments
`
`(“SLA”). Denied as to the remainder of this paragraph.
`
`Netpulse and BC also entered into the following agreements effective July 30,
`15.
`2015: a Virtual Active License Agreement (“VALA”) and an Advertising Services Agreement
`(“ASA”) (collectively, the “2015 Contracts”).
`
`ANSWER: Life Fitness admits that Netpulse and Life Fitness Division entered into the
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`Virtual Active License Agreement (“VALA”) and an Advertising Services Agreement (“ASA”)
`
`on July 30, 2015. Denied as to the remainder of this paragraph.
`
`Pursuant to the SLA and the 2015 Contracts (the “Contracts”), Netpulse provided
`16.
`BC with significant technology, including source code, executable code, videos, and other
`intellectual property. This included the “Netpulse Interface,” as defined in the Contracts, a
`touchscreen interface designed to work with BC’s equipment and that controlled the Netpulse
`entertainment platform and enabled content display and network connectivity. Netpulse also
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`4
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`Case: 1:22-cv-03239 Document #: 98 Filed: 05/10/24 Page 5 of 25 PageID #:1858
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`provided various VA materials, as further described and defined in the Contracts, including a
`library of VA videos designed to be used in conjunction with the Netpulse Interface and BC’s
`fitness equipment. This technology, the related intellectual property, and the videos, as further
`described in the Contracts, are referred to herein as the “Netpulse Technology.” The Netpulse
`Technology was provided to BC subject to constraints and limitations, as provided under the
`Contracts.
`
`ANSWER: Life Fitness admits that Netpulse and Life Fitness Division entered into the
`
`SLA, VALA, and ASA. Life Fitness further admits that Netpulse provided certain technology to
`
`Life Fitness Division pursuant to the SLA, VALA, and ASA. Life Fitness denies the remaining
`
`allegations of this paragraph.
`
`In conjunction with the Netpulse Technology, Netpulse provided BC with
`17.
`extensive confidential information, including but not limited to development information; details
`regarding the Netpulse Interface; detailed information regarding the VA library of videos and how
`to interface with them; communications (such as emails) containing technology details; testing
`data; computer software information (including developer notes, revisions, corrections, bug fixes,
`and related information); sales and marketing information; ideas, concepts, methodologies; and
`solutions relating to the interfaces and connections allowing for effective operation and
`incorporation of the VA videos and interactive features into consoles and machines, collectively
`referred to herein as the “Netpulse Confidential Information.” The Netpulse Confidential
`Information was provided to BC under the confidentiality provisions of the SLA, VALA, and
`ASA.
`
`ANSWER: Life Fitness admits that Netpulse provided technology, information, and
`
`Virtual Active videos to the Life Fitness Division. Denied as to the remainder of this paragraph.
`
`Under the SLA, Netpulse granted BC a “non-exclusive, non-sublicensable, non-
`18.
`transferable – right and license” to the Netpulse Code, including the VA Programs, as those terms
`were defined in the SLA; an “exclusive, non-sublicensable, non- transferable right and license” to
`manufacture, sell, and distribute certain equipment with the Netpulse attachable personal viewing
`screen and VA Programs, as defined in the SLA, with interactivity and additional features; and a
`perpetual, non-sublicensable, non-transferable license to make internal copies of, incorporate, and
`distribute the object code version of the Life Fitness Interface, as further described in the SLA.
`
`ANSWER: Life Fitness admits that Netpulse granted Life Fitness Division a “non-
`
`exclusive, non-sublicensable, non-transferable – right and license” to the Netpulse Code, including
`
`the VA Programs, as defined in the SLA. Life Fitness further admits that Netpulse granted Life
`
`Fitness Division an “exclusive, non-sublicensable, non- transferable right and license” to
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`5
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`Case: 1:22-cv-03239 Document #: 98 Filed: 05/10/24 Page 6 of 25 PageID #:1859
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`manufacture, sell, and distribute certain equipment as defined in the SLA. Life Fitness further
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`admits that Netpulse granted Life Fitness Division a perpetual, non-sublicensable, non-transferable
`
`license to make internal copies of, incorporate, and distribute the object code version of the Life
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`Fitness Interface, as described in the SLA. Denied as to the remainder of this paragraph.
`
`Under the SLA, each party retained all right, title, and interest in its intellectual
`19.
`property. The SLA also allowed each party to use the other party’s confidential information only
`as authorized. Upon termination, all licenses granted under the SLA were to terminate, BC was to
`cease manufacturing products under the agreement and within 6 months BC was to cease all
`marketing and offering for sale of such products. However, even after termination of the SLA,
`certain terms, including the confidentiality clause, survived.
`
`ANSWER: Admitted that the SLA stated that each party to the SLA retained all right,
`
`title, and interest in its intellectual property. Denied as to the remainder of this paragraph.
`
`Under the SLA, “neither party may assign any rights or delegate any duties …
`20.
`without the other party’s prior written consent, and any attempt to do so without that consent will
`be void,” except in certain specifically permitted circumstances. BC was only permitted to assign
`the SLA to a “surviving entity in a merger or consolidation in which [BC] participates or to a
`purchaser of all of substantially all of [BC’s] assets.”
`
`ANSWER: Life Fitness admits that the SLA states “neither party may assign any rights
`
`or delegate any duties … without the other party’s prior written consent, and any attempt to do so
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`without that consent will be void” with certain exceptions. Life Fitness further admits that the SLA
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`provides “[e]ither party may assign this Agreement or delegate its duties under this Agreement to
`
`the surviving entity in a merger or consolidation in which it participates or to a purchaser of all or
`
`substantially all of its assets.” Life Fitness denies the rest of the allegations in this paragraph.
`
`Under the VALA, Netpulse granted BC “an unlimited, perpetual, nontransferable,
`21.
`non-sublicensable and nonassignable license” to integrate certain VA products into BC’s exercise
`equipment, to make certain VA courses available via BC’s consoles, and to use and distribute
`updates to its customers. BC was not permitted to “sublicense Licensed Software [as defined in
`the VALA] to any third party, or otherwise cause any third party to use the Licensed Software in
`any way other than in [BC’s] own consoles without prior written approval of Netpulse.”
`
`ANSWER: Life Fitness admits that the VALA grants Life Fitness Division “an
`
`unlimited, perpetual, nontransferable, non-sublicensable and nonassignable license.” Life Fitness
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`Case: 1:22-cv-03239 Document #: 98 Filed: 05/10/24 Page 7 of 25 PageID #:1860
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`further admits that the VALA provides that “Life Fitness . . . shall not sublicense Licensed
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`Software to any third party, or otherwise cause any third party to use the Licensed Software in any
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`way other than in its own consoles without prior written approval of Netpulse.” Life Fitness denies
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`the rest of the allegations in this paragraph.
`
`The VALA also allowed each party “to use the other party’s Confidential
`22.
`Information only as authorized.” The “Confidential Information” described in the VALA included,
`inter alia, the Licensed Software and the parties’ research and development. Upon termination, all
`licenses granted under the VALA were to terminate and BC was to cease all marketing, offering
`for sale, etc., of its products with the Licensed Software. Even if the VALA were terminated,
`certain terms including the confidentiality clause survived termination.
`
`ANSWER: Life Fitness admits that the VALA states that it allows each party “to use
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`the other party’s Confidential Information only as authorized.” Life Fitness further admits that the
`
`VALA states that “Confidential Information” includes the Licensed Software and parties’ research
`
`and development. Life Fitness denies the rest of the allegations in this paragraph.
`
`Under the VALA “neither party may assign any rights or delegate any duties …
`23.
`without the other party’s prior written consent, and any attempt to do so without that consent will
`be void,” except in certain specifically permitted circumstances not applicable here. BC was only
`permitted to assign the VALA to a “surviving entity in a merger or consolidation in which [BC]
`participates or to a purchaser of all of substantially all of [BC’s] assets.”
`
`ANSWER: Life Fitness admits that VALA provides that “neither party may assign any
`
`rights or delegate any duties … without the other party’s prior written consent, and any attempt to
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`do so without that consent will be void” with certain exceptions. Life Fitness further admits that
`
`the VALA provides that “[e]ither party may assign this Agreement or delegate its duties under this
`
`Agreement to the surviving entity in a merger or consolidation in which it participates or to a
`
`purchaser of all or substantially all of its asset.” Life Fitness denies the rest of the allegations in
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`this paragraph.
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`Under the ASA, Netpulse granted BC “a limited, non-exclusive, non-transferable
`24.
`license to use the applicable Netpulse Software solely in accordance with the instructions provided
`to [BC] by Netpulse and for the sole purposes of receipt of the Advertising Services [as defined in
`the ASA].” BC was not permitted to otherwise use the Netpulse Software, as defined in the ASA,
`nor to modify, reverse engineer, create derivative works, sublicense, assign, or otherwise use the
`Netpulse Software in any way not permitted under the ASA. Netpulse retained all rights and title
`to the Netpulse Software and all intellectual property rights contained therein and associated
`therewith.
`
`ANSWER: Life Fitness admits that the ASA granted Life Fitness Division “a limited,
`
`non-exclusive, non-transferable license to use the applicable Netpulse Software solely in
`
`accordance with the instructions provided to Life Fitness by Netpulse and for the sole purposes of
`
`receipt of the Advertising Services.” Life Fitness denies the rest of the allegations in this
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`paragraph.
`
`The ASA also required each party to use the other party’s “Confidential
`25.
`Information” only as authorized. The “Confidential Information” described under the ASA
`included, inter alia, the Advertising Service (as defined in the ASA) and the parties’ research and
`development. Upon termination, all licenses granted under the ASA were to terminate. Even if the
`ASA were terminated, certain terms including the confidentiality clause survived termination.
`
`ANSWER: Life Fitness admits that the ASA stated that each party could use the other
`
`party’s “Confidential Information” only as authorized. Life Fitness further admits that the ASA
`
`stated that “Confidential Information” included the Advertising Service and the parties’ research
`
`and development. Life Fitness denies the rest of the allegations in this paragraph.
`
`Under the ASA “neither party may assign any rights or delegate any duties …
`26.
`without the other party’s prior written consent, and any attempt to do so without that consent will
`be void,” except in certain specifically permitted circumstances. BC was only permitted to assign
`the ASA to a “surviving entity in a merger or consolidation in which it participates or to a purchaser
`of all of substantially all of its assets.”
`
`ANSWER: Life Fitness admits that ASA states that “neither party may assign any rights
`
`or delegate any duties under this Agreement without the other party’s prior written consent, and
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`any attempt to do so without that consent will be void.” Life Fitness denies the rest of the
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`allegations in this paragraph.
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`Netpulse performed all its obligations under the SLA, VALA, and ASA, except
`27.
`those that it was excused from performing. Netpulse’s performance included providing BC with
`software, in both source code and executable code forms; providing confidential information,
`including confidential research, development, analysis, and testing; and providing various VA
`content, including VA videos.
`
`ANSWER: Life Fitness admits that Netpulse provided Life Fitness Division with
`
`software, information, and VA content. Life Fitness denies the rest of the allegations in this
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`paragraph.
`
`BC failed to meet its obligations under the SLA, VALA, and ASA by, inter alia,
`28.
`failing to enable Netpulse’s advertising software on BC’s consoles and taking unearned and
`fraudulent rebates. Effective at latest by 30 days after the filing of the California Litigation
`referenced in paragraph 30 below, if not earlier, the SLA, VALA, and ASA were terminated
`because of BC’s breaches of its obligations under each of those agreements. However, even
`though the SLA, VALA, and ASA were terminated, BC remained obligated to comply with many
`terms under the agreements, including the confidentiality obligations set forth in each agreement.
`
`ANSWER: Denied.
`
`On or about May 4, 2018, in connection with a tax-free reorganization pursuant to
`29.
`Section 368(a)(1)(C) of the Internal Revenue Code, Netpulse was merged into Nextpulse, LLC
`(“NP”), and thereupon NP became Netpulse’s successor in interest.
`
`ANSWER: Life Fitness lacks information sufficient to form a belief as to the allegations
`
`of this paragraph, and therefore denies them.
`
`On November 2, 2018, NP filed a lawsuit against BC in the Superior Court of
`30.
`California, in and for the County of San Francisco (the “California Litigation”). The California
`Litigation includes causes of action for Breach of Contract, Breach of the Implied Covenant of
`Good Faith and Fair Dealing, Fraud, and Misappropriation of Trade Secrets relating to the actions
`associated with the SLA, VALA, ASA, and other agreements between Netpulse and BC. BC also
`brought cross-claims. The California Litigation remains pending. While the SLA was found to
`have been novated by the 2015 Contracts in the California Litigation, that decision is not yet a
`final decision since the case remains pending.
`
`ANSWER: Life Fitness lacks information sufficient to form a belief as to the allegations
`
`of this paragraph, and therefore denies them.
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`At some point, which NP believes to have been in approximately 2018, KPS
`31.
`engaged in negotiations to potentially acquire BC’s Life Fitness Division. Based on information
`and belief, NP alleges that KPS engaged in due diligence during the course of its negotiations with
`BC and, among other things, learned of the existence of the SLA, VALA, and ASA and evaluated
`those agreements as part of the due diligence process.
`
`ANSWER: The allegations of this paragraph require no response as the Court dismissed
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`all of the tortious interference claims in this Complaint. Dkt. No. 89.
`
`On information and belief NP alleges that, in December of 2018, BC did an internal
`32.
`reorganization pursuant to which it created a wholly owned subsidiary of BC known as Life
`Fitness, LLC.
`
`ANSWER: Denied.
`
`NP is informed and believes, and on that basis alleges, that KPS created Lumos as
`33.
`an affiliate so that Lumos could be the acquiring entity of Life Fitness, LLC. NP is informed and
`believes, and on that basis alleges, that at some point Lumos also became involved in the
`negotiations and due diligence process with BC in connection with the purchase of BC’s fitness
`business, including its wholly owned subsidiary, Life Fitness, LLC. As with KPS, NP is informed
`and believes, and on that basis alleges, that during the course of Lumos’s negotiations with BC it
`learned, among other things, of the terms of the SLA, VALA, and ASA and evaluated those
`agreements as part of the due diligence process.
`
`ANSWER: The allegations of this paragraph require no response as the Court dismissed
`
`all of the tortious interference claims in this Complaint. Dkt. No. 89.
`
`On or about June 27, 2019, BC sold its entire fitness business (including its wholly
`34.
`owned subsidiary Life Fitness, LLC) to Lumos, an affiliate of KPS, a private investment firm, in
`an all-cash transaction for approximately $490 million. NP is not presently aware of the details of
`that transaction. As a result of that transaction, for the first time Life Fitness, LLC, became a legal
`entity that was no longer a wholly owned subsidiary of BC. LF has never been a party to any of
`the Contracts and never had any rights under any of the Contracts.
`
`ANSWER: Life Fitness admits that Life Fitness was acquired by Lumos in June 2019.
`
`Life Fitness denies the rest of the allegations in this paragraph.
`
`During the California Litigation, BC initially denied assigning or transferring the
`35.
`Contracts or any rights thereunder to LF when or after LF became a separate legal entity. BC even
`stated under penalty of perjury that the Contracts were “not contemplated in the sale [of BC’s
`fitness business, including Life Fitness, LLC], in part, because each of the contracts had either
`been novated, terminated, not-renewed, or expired.” In the early part of 2022, NP learned for the
`first time that BC had in fact transferred to LF significant confidential information and intellectual
`property BC obtained from Netpulse or had rights to pursuant to the Contracts with Netpulse.
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`ANSWER: Life Fitness lacks information sufficient to form a belief as to the allegations
`
`of this paragraph, and therefore denies them.
`
`After BC sold its fitness business, LF became a separate legal entity that was no
`36.
`longer owned by BC. LF was a third party that had no contractual rights under the Contracts and,
`pursuant to the explicit terms of each of the agreements, BC was not capable of assigning any
`rights under any of these agreements to LF without Netpulse’s consent, which was never requested
`by BC nor ever given by Netpulse or NP.
`
`ANSWER: Life Fitness admits it was a separate legal entity no longer owned by BC
`
`after June 2019. Life Fitness denies the rest of the allegations in this paragraph.
`
`NP is informed and believes, and thereon alleges, that upon completion of the sale
`37.
`of LF by BC, BC transferred to LF all of the Netpulse Technology, Netpulse Confidential
`Information, and various forms of intellectual property Netpulse provided to BC during Netpulse’s
`and BC’s contractual relationship associated with the Contracts.
`
`ANSWER: Denied.
`
`NP is informed and believes, and thereon alleges, that upon completion of the sale
`38.
`of LF by BC on or about June 27, 2019, LF began using the Netpulse Technology and Netpulse
`Confidential Information, despite having no legal right to do so since BC had no right to transfer
`or assign any right or license to use such technology and confidential information. NP is informed
`and believes, and thereon alleges, that at all times relevant to this matter, LF has knowingly,
`deliberately, and willfully used, and threatens in the future to use, the Netpulse Technology and
`Netpulse Confidential Information without any right, license, or authorization to do so, in willful
`violation of NP’s rights.
`
`ANSWER: Denied.
`
`NP is informed and believes, and thereon alleges, that each of the Defendants was
`39.
`aware of the Contracts and the terms of those Contracts, including the fact that the rights under the
`Contracts could not be transferred or assigned, since many of the persons employed by LF were
`previously employed in BC’s Life Fitness division and further since these Contracts certainly
`should have been reviewed and evaluated by Lumos and KPS during the due diligence process
`associated with the acquisition of LF.
`
`ANSWER: The allegations of this paragraph require no response as the Court dismissed
`
`all of the tortious interference claims in this Complaint. Dkt. No. 89.
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`Case: 1:22-cv-03239 Document #: 98 Filed: 05/10/24 Page 12 of 25 PageID #:1865
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`NP is informed and believes, and thereon alleges, that despite being well aware of
`40.
`the contractual terms prohibiting transfer or assignment and requiring confidential information to
`be kept confidential, Defendants intentionally interfered with the contractual relationship between
`Netpulse and BC, and induced BC to breach the Contracts by causing BC to illegally, and in breach
`of the agreements, transfer Netpulse’s confidential and proprietary information to LF and/or
`violate the confidentiality clauses in those agreements.
`
`ANSWER: The allegations of this paragraph require no response as the Court dismissed
`
`all of the tortious interference claims in this Complaint. Dkt. No. 89.
`
`NP had ownership of certain trade secrets, copyrights, and other intellectual
`41.
`property described herein as a result of its predecessor in interest Netpulse’s development of these
`rights and interests, while other rights were obtained as a result of acquisitions, transfers, or
`assignments. In 2019, NP entered into a contract with VA and Forward Motion Partners LLC
`(“FMP”) through which certain intellectual property was transferred to VA and/or FMP.
`Subsequently, in 2022, VA and FMP transferred ownership and rights to specified video content,
`to the extent such rights were held by VA and/or FMP, to NP. NP registered copyrights in certain
`VA videos and has ownership of those copyrights.
`
`ANSWER: Life Fitness lacks information sufficient to form a belief as to the allegations
`
`of this paragraph, and therefore denies them.
`
`NP owns and has title to registered copyrights in its computer software, as set forth
`42.
`in Exhibit A to this Amended Complaint.
`
`ANSWER: Life Fitness lacks information sufficient to form a belief as to the allegations
`
`of this paragraph, and therefore denies them.
`
`Based on the foregoing, NP is informed and believes, and thereon alleges, that LF
`43.
`has unlawfully used, reproduced, distributed, and/or made into a derivative work NP’s copyrighted
`computer software, without authorization or right to do so, has infringed NP’s valuable intellectual
`property rights, including its copyrighted computer software, and has threatened to, and will
`continue to, infringe NP’s intellectual property rights unless restrained by this Court.
`
`ANSWER: Denied.
`
`NP owns and has title to registered copyrights in numerous VA videos, as set forth
`44.
`in Exhibit B to this Amended Complaint.
`
`ANSWER: Life Fitness lacks information sufficient to form a belief as to the allegations
`
`of this paragraph, and therefore denies them.
`
`12
`
`

`

`Case: 1:22-cv-03239 Document #: 98 Filed: 05/10/24 Page 13 of 25 PageID #:1866
`
`Based on the foregoing, NP is informed and believes, and thereon alleges, that LF
`45.
`has unlawfully reproduced, distributed, publicly displayed, and/or created derivative works of
`NP’s copyrighted VA videos, without authorization or right to do so, has infringed NP’s valuable
`intellectual property rights, including its copyrighted videos, and has threatened to, and will
`continue to, infringe NP’s intellectual property rights unless restrained by this Court.
`
`ANSWER: Denied.
`
`At all times herein relevant, NP has complied in all respects with the Copyright
`46.
`Act, 17 U.S.C. Sections 101, et seq., to secure the exclusive rights and privileges in and to the
`copyrights in the NP computer software and videos referenced herein. The NP computer software
`and the videos set forth in Exhibits A and B that are the subject of this Amended Complaint consist
`of original works of authorship that are copyrightable under the Copyright Act. Copyrights in this
`computer software and these videos have been registered in full compliance with the Copyright
`Act, and NP has received certificates of registration from the Registrar of Copyrights for them. NP
`is the owner of all rights, title, and interest to said federal copyright registrations.
`
`ANSWER: Denied.
`
`LF’s reproduction, distribution, public display, and/or creation of derivative works
`47.
`of NP’s copyrighted computer software and videos is without permission or valid license. No
`legitimate basis exists for LF’s unauthorized use of NP’s copyrighted computer software and
`videos.
`
`ANSWER: Denied.
`
`NP seeks through this Amended Complaint to obtain preliminary and permanent
`48.
`injunctive relief enjoining LF, its affiliates, officers, directors, em