Int'l Aero Prods., LLC v. Aero Advanced Paint Tech., Inc.
Int'l Aero Prods., LLC v. Aero Advanced Paint Tech., Inc.
Opinion of the Court
I. INTRODUCTION
Pending before the Court is Defendant Aero Advanced Paint Technology, Inc.'s Motion to Dismiss, or in the alternative, Motion to Transfer for Lack of Personal Jurisdiction. (Mot. to Dismiss ("Mot."), ECF No. 16-1.) For the reasons below, the Court DENIES Defendant's Motion.
II. FACTUAL AND PROCEDURAL BACKGROUND
This action arises from Plaintiff International Aero Products LLC's ("Plaintiff" or "IAP") allegations that Defendant Advanced Aero Paint Technology, Inc.'s ("Defendant" or "AAPT") infringed on Plaintiff's trademarks. (Compl. ¶ 1, ECF No. 1.) Specifically, the dispute concerns the right to use "AERO" and "AERO and Design" as trademarks. (See Opp'n 1, ECF No. 21.) In or around November 2016, while Plaintiff was advertising and promoting its products at the Specialty Equipment Market Association ("SEMA") in Las Vegas, Nevada, Defendant claimed that one of its customers was confused when he or she saw Plaintiff's products and exhibit and believed Plaintiff was related to Defendant. (Compl. Ex. 6, at 1.)
On April 11, 2018, Plaintiff IAP, a California limited liability company, commenced a lawsuit against Defendant AAPT. (Compl., ECF No. 1.) Plaintiff brought two causes of action: (1) infringement of a federally registered trademark under
On April 28, 2018, Defendant AAPT initiated a lawsuit in the Southern District of Ohio against IAP; International Aero Holdings, LLC; International Aero Engineering, LLC; International Aero Services, LLC; Jonathan M. Saltman; and DOES 1-5 (the "Ohio Action"). See Complaint with Jury Demand, *1083Aero Advanced Paint Technology, Inc. v. International Aero Products, LLC et al. , No. 2:18-cv-00394-MHW-CMV (S.D. Ohio Apr. 28, 2018), ECF No. 1. Defendant's lawsuit asserts causes of action for: (1) Trademark Infringement in violation of
On May 3, 2018, before Defendant answered and within ninety (90) days after filing the Complaint, Plaintiff filed a First Amended Complaint ("FAC"). (FAC, ECF No. 11.) The FAC is essentially identical to the Complaint with one exception: instead of identifying Plaintiff IAP as a California limited liability company, Plaintiff amended the Complaint to assert that Plaintiff is actually a Delaware limited liability company with its principal place of business in California. (FAC ¶ 1.)
On June 8, 2018, in the Ohio Action, Plaintiff IAP (and the related entities and individual) filed a Motion to Dismiss and Transfer to transfer the case back to the Central District. See Motion to Dismiss, Stay, or Transfer, Aero Advanced Paint Technology, Inc. v. International Aero Products, LLC et al. , No. 2:18-cv-00394-MHW-CMV (S.D. Ohio June 18, 2018), ECF No. 27.
Subsequently, on June 28, 2018, Defendant AAPT filed its Motion to Dismiss or Transfer for Lack of Personal Jurisdiction in this action. (Mot., ECF No. 16.) This Motion is now before the Court for decision.
III. LEGAL STANDARD
A. Motion to Dismiss for Lack of Personal Jurisdiction
Pursuant to Federal Rule of Civil Procedure 12(b)(2), a party may seek dismissal of an action for lack of personal jurisdiction. Once a party seeks dismissal under Rule 12(b)(2), the plaintiff has the burden of demonstrating that the exercise of personal jurisdiction is proper. Menken v. Emm ,
A federal district court may exercise personal jurisdiction over a non-resident defendant if the defendant has "at least 'minimum contacts' with the relevant forum such that the exercise of jurisdiction 'does not offend traditional notions of fair play and substantial justice.' " Dole Food Co., Inc. v. Watts ,
B. Motion to Dismiss/Transfer for Improper Venue
"For the convenience of parties and witnesses and in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought." 28 U.S.C. 1404(a).
Cases are also transferred based on the "first-to-file" rule. The first-to-file rule is a doctrine of federal comity; a district court may decline to exercise jurisdiction over an action when a complaint involving the same parties and issues has been filed in another district. Pacesetter Sys., Inc. v. Medtronic Inc. ,
In considering whether to apply this doctrine, a court must consider: (1) the chronology of the two actions; (2) the similarity of the parties; and (3) the similarity of the issues. See Kohn Law Grp., Inc. v. Auto Parts Mfg. Miss., Inc. ,
IV. DISCUSSION
A. Specific Jurisdiction
1. Purposeful Direction
Plaintiff does not dispute that Defendant would not be subject to general jurisdiction in California; therefore, only specific jurisdiction is at issue here. (See Opp'n 7; Reply 3, ECF No. 22.) To determine specific jurisdiction in a suit involving trademark infringement,
The Ninth Circuit has held that the relevant inquiry for purposeful direction is whether the defendant allegedly has (1) committed an intentional act, (2) expressly aimed at the forum state, (3) causing harm that the defendant knows is likely to be suffered in the forum state. Schwarzenegger ,
a. Intentional Act
Under the first prong, Defendant must commit an intentional act. Plaintiff alleges that Defendant infringed on its trademark through the use of "Aero" and "Aero and Design" in connection with the *1085marketing and sale of paint on automobiles without its permission. (FAC ¶¶ 27-29.) Plaintiff further alleged that Defendant's infringement was "knowing, willful, and deliberate." (Id. ¶ 31.) These allegations satisfy the "intentional act" prong. See Levi Strauss & Co. v. Toyo Enter. Co., Ltd. ,
b. Expressly Aimed
Under the second prong, Plaintiff must demonstrate that Defendant expressly aimed its actions at the forum state. In this case, Plaintiff's allegations are substantially based on Defendant's website. The Ninth Circuit addressed this issue in Mavrix Photo Inc. v. Brand Techs., Inc. ,
The Ninth Circuit has also found that specific jurisdiction exists when "a plaintiff files suit in its home state against an out-of-state defendant and alleges that defendant intentionally infringed its intellectual property rights knowing the plaintiff was located in the forum state." Adobe Sys. Inc. v. Blue Source Group, Inc. ,
However, personal jurisdiction does not hinge on the sale of the accused products in the forum state; all that a plaintiff needs to show is that the defendant "willfully infringed" and that the defendant knew that the plaintiff had its principal place of business in this district. See
Here, without addressing the veracity of Plaintiff's allegations, Plaintiff establishes a prima facie case that Defendant willfully infringed on Plaintiff's trademark in this district. Specifically, Plaintiff alleges that Defendant, through the use of its interactive website, Defendant advertised, displayed, and offered for sale products that were similar to Plaintiff's products to consumers in this district. (FAC ¶ 5.) Defendant's website also includes several news articles and promotional advertisements targeted at the Central District. (See FAC Ex. 3.) Further, Plaintiff has made a prima facie showing that Defendant was aware of Plaintiff's principal place of business as Defendant's cease and desist letter is addressed to Plaintiff's President/CEO in Bellflower, California. (FAC Ex. 6.)
Accordingly, Plaintiff has made a prima facie showing that Defendant's conduct was expressly aimed at the forum state.
c. Foreseeable Harm
Under the third prong, Plaintiff must demonstrate that Defendant's conduct caused harm that it knew was likely to be suffered in the forum. Adidas Am., Inc. v. Cougar Sport, Inc. ,
*1086Brayton Purcell LLP v. Recordon & Recordon ,
As established above, Defendant's cease and desist letter is addressed to Plaintiff's principal place of business in the forum state. Further, Plaintiff argues that its sole place of business is within this district and that it manufactures all of its products in this district. (Opp'n 11.) Therefore, it is foreseeable that Plaintiff would suffer at least some harm by Defendant's alleged trademark infringement in this district. Accordingly, Plaintiff has satisfied this element.
2. Arising Out Of
The second requirement for the Court to exercise specific personal jurisdiction "is that the claim asserted in the litigation arises out of the defendant's forum related activities." Panavision , 141 F.3d at 1322. To determine whether a plaintiff's claim arises out of the defendant's forum-related activities, courts use a "but for" causation analysis. Bancroft & Masters, Inc. v. Augusta Nat. Inc. ,
Here, Plaintiff alleges that it is one of the largest and most well-respected private jet detailers in the world with widespread public recognition of its products and trademark. (FAC ¶¶ 12, 15.) Plaintiff further alleges that Defendant's use of the trademark is "likely to cause confusion, mistake, or deception among the public." (FAC ¶ 27.) Accordingly, Plaintiff alleges that it suffered harm in this district, and the but-for cause of this harm is Defendant's alleged infringement. This is sufficient to show that Plaintiff's claims arise out of Defendant's forum-related activities. See CollegeSource, Inc. v. AcademyOne, Inc. ,
3. Reasonableness
As Plaintiff has made a prima facie case that specific jurisdiction over Defendant is proper, the burden shifts to Defendant to show why the exercise of jurisdiction would not be reasonable and fair. Schwarzenegger ,
Here, Defendant fails to substantively address the reasonableness or fairness of this Court exercising jurisdiction. Instead, Defendant argues that Plaintiff's allegations rely on false and unsupported representations, and that in any event, this Court should transfer the action to the "first filed Ohio Action." (Reply 9.) As the Court addresses below, Defendant's presumption that the Ohio Action is the first filed action is wrong.
Accordingly, the Court finds that it has specific personal jurisdiction as to Defendant APPT. The Court further denies Plaintiff's request for jurisdictional discovery as moot.
B. Motion to Dismiss/Transfer for Lack of Personal Jurisdiction
Defendant requests that this Court transfer the action pursuant to
1. Chronology of the Actions
The first-and most fundamental-requirement is that the action in the transferee district court must have been filed prior to the action in the transferor district court. Wallerstein v. Dole Fresh Vegetables, Inc. ,
It is abundantly clear that Plaintiff's action in this district was filed first. Defendant's only argument is that Plaintiff's amendment, changing Plaintiff from a California limited liability company to a Delaware limited liability company did not relate back to the original filing, and thus, the Ohio Action is the first filed action.
This Court is guided by our sister court's decision in Barnes & Noble, Inc. v. LSI Corp. ,
Thus, this Court finds that Plaintiff's case is the first filed action.
2. Similarity of Parties
The second factor that must be satisfied is the similarity of parties. Alltrade, Inc. ,
Though Defendant argues that the parties are not identical and that the Ohio Action contains several other defendants who are "believed to have an interest in the subject action," the Court finds that the parties are substantially similar. (See Mot. 7.) The addition of the other parties in the Ohio Action are affiliated parties/entities to Plaintiff in this action.
3. Similarity of Issues
The last factor that must be satisfied is the similarity of issues. Alltrade, Inc. ,
C. Sanctions
Defendant, in its Reply in Support of its Motion, requests Rule 11 sanctions as well as an award of reasonable expenses in defending its own Motion. The Court declines to do so. Not only does Defendant raise sanctions for the first time in its Reply, but it has made no showing that it has complied with Rule 11's procedural requirements including the safe harbor provision. Rule 11 further requires that a motion for sanctions "be made separately from any other motion and must describe the specific conduct that allegedly violates Rule 11(b)."
The Court further admonishes the parties against recklessly requesting Rule 11 sanctions without following any of the procedural rules. See Gaiardo v. Ethyl Corp. ,
V. CONCLUSION
For the reasons discussed above, the Court ORDERS as follows:
(1) The Court DENIES the Defendant's Motion to Dismiss;
(2) The Court DENIES the Defendant's Motion to Transfer;
(3) The Court DENIES the Defendant's request for sanctions;
(4) The Court DENIES Plaintiff's request for jurisdictional discovery.
IT IS SO ORDERED.
Having carefully considered the papers filed in support of and in opposition to the instant Motion, the Court deems the matter appropriate for decision without oral argument. Fed. R. Civ. P. 78 ; L.R. 7-15.
Cases involving trademark infringement are "akin to a tort case." Panavision Int'l, L.P. v. Toeppen ,
The Ohio Action also includes International Aero Holdings, LLC; International Aero Engineering, LLC; International Aero Services, LLC; and Jonathan M. Saltman. Jonathan M. Saltman is the part-owner and CEO of Plaintiff IAP, and declared under penalty of perjury that the additional parties in the Ohio Action are all affiliated entities. (Decl. of Jonathan Saltman ¶¶ 1-3, ECF No. 22-1.)
Reference
- Full Case Name
- INTERNATIONAL AERO PRODUCTS, LLC v. AERO ADVANCED PAINT TECHNOLOGY, INC.
- Cited By
- 5 cases
- Status
- Published