GREG N. STIVERS, District Judge.
This matter is before the Court on Defendant's Motion to Dismiss (DN 15), Plaintiff's Motion for Preliminary Injunction (DN 4), and Plaintiff's Motion for Leave to File a Sur-Reply (DN 25). For the reasons outlined below, Defendant's Motion to Dismiss is
Plaintiff Fruit of the Loom, Inc. ("FOL") is a global garment manufacturer which owns various trademarks registered with the U.S. Patent & Trademark Office ("USPTO"). (Compl. ¶¶ 7-9, 12-13, DN 1). Its marks include the word marks FRUIT and FRUIT OF THE LOOM, and other related marks with design elements that are used in connection with, inter alia, "clothing or textile goods, including T-shirts, underwear, activewear, and socks . . . ." (Compl. ¶¶ 12-13).
On July 8, 2015, Defendant En Garde, LLC ("En Garde") filed an intent-to-use trademark application with the USPTO for the word mark FRUIT OF THE TOMB to be used with "clothing, namely, t-shirts, pants, hats, socks, swim suits, and shorts . . . ." (Compl. ¶ 21 (internal quotation marks omitted)). FOL has filed an opposition with the USPTO Trademark & Appeal Board, which is still pending. (Compl. ¶ 23).
FOL has alleged that En Garde or someone acting on its behalf has registered the domain name fruit-of-the-tomb.com. (Compl. ¶ 25). En Garde has also purportedly begun selling apparel in its locality of Houston, Texas, and has established an online store through Shopify. (Compl. ¶ 26). According to FOL, "En Garde currently operates an online store selling apparel and handbags at http://fruit-of-the-tomb.co and http://fruit-of-the-tomb.myshopify.com," in which Defendant uses its FRUIT OF THE TOMB mark. (Compl. ¶ 28). En Garde is allegedly marketing and selling its wares on social media platforms such as Facebook and Twitter. (Compl. ¶ 29).
FOL filed this lawsuit alleging trademark infringement in violation of 15 U.S.C. § 1114, trademark dilution in violation of 15 U.S.C. § 1125(c), and federal unfair competition in violation of 15 U.S.C. § 1125(a). (Compl. ¶¶ 39-54). After FOL moved for a preliminary injunction, En Garde moved to dismiss this lawsuit due to lack of personal jurisdiction. (Pl.'s Mot. Prelim. Inj., DN 4; Def.'s Mot. Dismiss, DN 15).
This Court has subject-matter jurisdiction of this matter based upon federal question jurisdiction and because of federal courts' exclusive jurisdiction over trademark law. See 28 U.S.C. §§ 1331, 1338.
En Garde has moved to dismiss FOL's claims because this Court lacks personal jurisdiction over En Garde. (Def.'s Mot. Dismiss 2-11, DN 15). A plaintiff bears the burden of proving that a court has personal jurisdiction over a defendant. See Air Prods. & Controls, Inc. v. Safetech Int'l, Inc., 503 F.3d 544, 549 (6th Cir. 2007). To survive a motion to dismiss, a plaintiff must present a prima facie case of personal jurisdiction over the moving party. See Nationwide Mut. Ins. Co. v. Tryg Int'l Ins. Co., 91 F.3d 790, 792 (6th Cir. 1996). In ruling on a motion under Fed. R. Civ. P. 12(b)(2) the Court may resolve the motion without an evidentiary hearing, but it must construe the pleadings, affidavits, and other evidence in the light most favorable to the plaintiff. See Bird v. Parsons, 289 F.3d 865, 871 (6th Cir. 2002). A court should not weigh "the controverting assertions of the party seeking dismissal." Theunissen v. Matthews, 935 F.2d 1454, 1459 (6th Cir. 1991) (citations omitted).
A federal court has personal jurisdiction over a defendant if: "(1) the defendant is amenable to service of process pursuant to the forum state's long-arm statute and (2) the exercise of personal jurisdiction would not deny due process under federal Constitution." Coleman v. Mary Jane M. Elliott, P.C., No. 3:14-CV-00640-CRS, 2015 WL 3407320, at *2 (W.D. Ky. May 21, 2015) (citing Bird, 289 F.3d at 871). At this stage of the litigation and because the Court is addressing this issue based upon written submissions only, FOL "need only make a prima facie showing of jurisdiction" to defeat En Garde's motion to dismiss. Compuserve, Inc. v. Patterson, 89 F.3d 1257, 1262 (6th Cir. 1996) (citing Theunissen, 935 F.2d at 1458-59).
En Garde asserts that it is not subject to service of process under Kentucky's long-arm statute, KRS 454.210. (Def.'s Mot. Dismiss 5-6). To obtain service of process on En Garde, KRS 454.210 must authorize personal jurisdiction over it. See KRS 454.210(3)(a)("When personal jurisdiction is authorized by this section, service of process may be made on such person, or any agent of such person, in any county in this Commonwealth, where he may be found, or on the Secretary of State who, for this purpose, shall be deemed to be the statutory agent of such person.").
In Caesars Riverboat Casino, LLC v. Beach, 336 S.W.3d 51 (Ky. 2011), the Kentucky Supreme Court clarified the scope of KRS 454.210, which had been construed broadly by Kentucky courts. In Beach, the court explained the proper analysis of the long-arm statute is as follows:
Id. at 57.
In its response to this motion, FOL avers that En Garde's conduct subjects it to personal jurisdiction under KRS 454.210(2)(a)(2). (Pl.'s Resp. Def.'s Mot. Dismiss 8, DN 9). In relevant part, the long-arm statute provides that "[a] court may exercise personal jurisdiction over a person who acts directly or by an agent, as to a claim arising from the person's . . . [c]ontracting to supply services or goods in this Commonwealth . . . ." KRS 454.210(2)(a)(2). With regard to En Garde's activities within Kentucky, FOL has asserted that En Garde has sold only one garment bearing the offending mark in Kentucky,
It is apparent that En Garde's sale of goods to only one buyer in Kentucky is sufficient to satisfy KRS 454.210(2)(a)(2). As the Kentucky Supreme Court has commented, "[a] plain reading of the statutory language produces the interpretation that the contract need not be made or executed `in this Commonwealth,' but, rather, only that the contract provide for the supplying of services or goods to be transported into, consumed or used in Kentucky." Hinners v. Robey, 336 S.W.3d 891, 896 (Ky. 2011). The buyer's use of En Garde's page on the myshopify.com web platform was the means through which En Garde offered to sell its wares at the stated prices. When the buyer selected the item to purchase and paid for the item, En Garde had a contractual obligation to fill the order and mail the item to the purchaser who was located in Kentucky.
In Beach, the Kentucky Supreme Court addressed the "arising from" requirement found in KRS 454.210(2)(a). Rejecting a "but for" test, the court held that the proper test is whether there is a "reasonable and direct nexus between the conduct that caused [the plaintiff's] injury and [the defendant's] business activities in Kentucky." Beach, 336 S.W.3d at 59. Absent such a reasonable and direct nexus, there is no personal jurisdiction over a defendant. See id.
Applying that test to FOL's claims against En Garde, Plaintiff has presented sufficient evidence to show that its claims arise from the conduct of En Garde in this forum. A t-shirt was sold via the myshopify.com web platform and delivered to a purchaser in Kentucky. (Filteau Decl. ¶ 5). The subject t-shirt may have infringed on FOL's marks or FOL may have been otherwise injured as a result of that sale. Thus, FOL has satisfied its burden to show that this transaction falls under one of the enumerated grounds for exercising personal jurisdiction under Kentucky's long-arm statute.
To exercise personal jurisdiction over En Garde, the Court must next determine whether the requirements of due process are met—"whether the facts of the case demonstrate that the nonresident defendant possesses such minimum contacts with the forum state that the exercise of jurisdiction would comport with `traditional notions of fair play and substantial justice.'" Theunissen, 935 F.2d at 1459 (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)). Under Sixth Circuit precedent, this Court is to consider the following criteria in making that determination:
S. Mach. Co. v. Mohasco Indus., Inc., 401 F.2d 374, 381 (6th Cir. 1968).
In this case, En Garde contends that it has not purposefully availed itself of the privilege of conducting business within Kentucky "because its single sale and online activity do not establish the `substantial connection' with the forum state that is necessary to meet the first prong of specific jurisdiction." (Def.'s Mot. Dismiss 7). FOL maintains that the purposeful availment requirement is satisfied by the following conduct of En Garde: "(1) by maintaining multiple websites, accessible in Kentucky, through which En Garde sells apparel online, including at least one sale in Kentucky; and (2) targeting [FOL] at its principal place of business in Kentucky through willful trademark infringement."
"Traditionally, when an entity intentionally reaches beyond its boundaries to conduct business with foreign residents, the exercise of specific jurisdiction is proper. Different results should not be reached simply because business is conducted over the Internet." Zippo Mfg. Co. v. Zippo Dot Com, Inc., 952 F.Supp. 1119, 1124 (W.D. Pa. 1997) (internal citation omitted). As a sister court has explained in analyzing personal jurisdiction over disputes involving internet transactions:
Visage Spa, LLC v. Salon Visage, Inc., No. 06-10756, 2006 WL 2130512, at *6 (E.D. Mich. July 28, 2006) (internal citations omitted) (internal footnotes omitted) (citation omitted). The Sixth Circuit has expressed caution in relying on the existence of website as evidence of purposeful availment because "[a]n Internet website by its very nature can be accessed internationally. . . . The level of contact with a state that occurs simply from the fact of a website's availability on the Internet is therefore an `attenuated' contact that falls short of purposeful availment." Neogen Corp., 282 F.3d at 890 (citation omitted). As a sister court noted:
Lexmark Int'l, Inc. v. Laserland, Inc., 304 F.Supp.2d 913, 918 (E.D. Ky. 2004) (internal citation omitted) (quoting Zippo Mfg. Co., 952 F. Supp. at 1124).
In this case, En Garde's page on the myshopify.com web platform (which is hosted in Canada) appears to be more of an active website where it seeks to sell its goods to customers throughout the United States and potentially around the world. (Filteau Decl. ¶ 2). That alone, however, is not enough because there is no evidence that "the website is interactive to a degree that reveals specifically intended interaction with residents of [] [Kentucky]." Neogen Corp., 282 F.3d at 890 (citing Zippo Mfg. Co., 952 F. Supp. at 1124).
According to En Garde, its total sales between May 2016 and June 2017 amount to $3,760. (Filteau Decl. ¶ 4). As discussed above, it appears undisputed that En Garde's sole pre-litigation sale was for one t-shirt mailed to a purchaser in Sturgis, Kentucky. (Pl.'s Resp. Def.'s Mot. Dismiss Ex. H). Besides its web presence, there is no evidence that En Garde has had any other interactions with Kentucky residents. Thus, this isolated sale drastically differs from conduct reflecting purposeful availment by En Garde in Kentucky sufficient to authorize personal jurisdiction consistent with the requirements of due process.
The Sixth Circuit's decision in Kerry Steel, Inc. v. Paragon Industries, Inc., 106 F.3d 147 (6th Cir. 1997), is instructive. Kerry Steel, a Michigan steel service center, contacted a Paragon Industries, an Oklahoma pipe fabricator, offering to sell approximately $300,000 in steel coils. See id. at 148. After the parties engaged in negotiations via telephone and fax, and the buyer accepted the offer via telephone. See id. The goods were delivered to the Paragon Industries' warehouse in Illinois. See id. After the buyer refused to pay for the goods due to an issue with their quality, Kerry Steel filed suit in state court in Michigan. See id. Following the removal of the case to federal court, Paragon Industries moved to dismiss the claims due to lack of personal jurisdiction. See id. After the trial court dismissed the claims, Kerry Steel appealed. In affirming the dismissal and addressing the lack of purposeful availment by Paragon Industries, the Sixth Circuit explained:
Id. at 151 (internal citations omitted).
The lack of purposeful availment by En Garde in this case is analogous to this Court's earlier decision in Advanced Solutions Life Sciences, LLC v. BioBots, Inc., No. 3:16-CV-00709-CRS, 2017 WL 2114969 (W.D. Ky. May 15, 2017). In Advanced Solutions, the defendant, a startup company called BioBots, Inc. ("BioBots"), developed 3D bioprinters using the BIOBOTS mark. See id. at *1. The use of that mark, however, allegedly infringed upon a BIOASSEMBLYBOT mark owned by Advanced Solutions Life Sciences, LLC ("ASLS"). See id. BioBots sales to Kentucky residents consisted of one printer to a researcher at the University of Louisville
After being served with service of process, BioBots moved to dismiss the lawsuit due to lack of personal jurisdiction. See id. at *1. This Court concluded that BioBots' sale to Kentucky fell within KRS 454.210(2)(a)(2) and that ASLS's claims against BioBots had a direct and reasonable nexus to BioBots' sales to Kentucky residents. See id. at *3-4. In analyzing the due process requirement, however, this Court concluded that exercising personal jurisdiction over BioBots would violate its federal due process rights. See id. at 7. In reaching that conclusion, this Court reasoned:
Id. at *6 (internal citations omitted) (citation omitted).
The case sub judice appears indistinguishable from Advanced Solutions. En Garde did not engage in business with Kentucky residents on a regular basis, but only had one order shipped to a Kentucky resident prior to this lawsuit. The sale was initiated by one buyer on En Garde's web page, which unquestionably constitutes an isolated transaction. There is no evidence to show that this sale was intended to establish an ongoing relationship between En Garde and the purchaser.
While not referenced by FOL as the Calder effects test,
In Advanced Solutions, this Court also rejected the application of the Calder effects test to prove purposeful availment. See Advanced Sols., 2017 WL 2114969, at *5-6. Because the Court views the facts of Advanced Solutions as very similar to the present case, the Court likewise concludes that Calder effects test does not alter this Court's conclusion that it lacks personal jurisdiction over En Garde. See also QSR Automations, 2010 WL 1416700, at *4 (rejecting the application of the Calder effects test because "[t]he problem is that there have been no `minimum contacts' with Kentucky so that the exercise of jurisdiction over [the defendant] would not offend `traditional notions of fair play and substantial justice.'" (quoting Int'l Shoe Co., 326 U.S. at 316)). As in Advanced Solutions, there is no evidence that En Garde "expressly aimed" its actions at Kentucky or that Kentucky was the "focal point" of En Garde's allegedly wrongful conduct and the resulting harm. See Advanced Sols., 2017 WL 2114969, at *6-7.
For these reasons, FOL has failed to meet its burden of proving purposeful availment. Because that requirement has not been satisfied, it is unnecessary for the Court to address whether FOL's claims arise from En Garde's activities and whether the exercise of jurisdiction over En Garde would be reasonable under these circumstances.
FOL has also moved for a preliminary injunction to preclude En Garde from infringing on FOL's trademarks. Because the Court lacks personal jurisdiction over En Garde, the Court will deny this motion as moot.
Finally, FOL has moved for leave to file a sur-reply. (Pl.'s Mot. Leave File Sur-Reply, DN 25). "As many courts have noted, `[s]ur-replies . . . are highly disfavored, as they usually are a strategic effort by the nonmoving party to have the last word on a matter." Liberty Legal Found. v. Nat'l Democratic Party of the USA, Inc., 875 F.Supp.2d 791, 797 (W.D. Tenn. 2012) (citation omitted).
FOL incorrectly asserts that its sur-reply is necessary because of new arguments raised by En Garde, the Court disagrees. In its reply, En Garde addressed an exhibit provided in FOL's response upon which FOL relied in encouraging the Court's exercise of personal jurisdiction over En Garde. While FOL is critical of En Garde's reply, its reply "is entirely consistent with the proper purpose of a reply brief, to address the opposing party's arguments raised in a response brief." Liberty Legal Found., 875 F. Supp. 2d at 797-98. Through its proposed surreply FOL seeks leave to respond on that issue,
For the foregoing reasons,
1. Defendant's Motion to Dismiss (DN 15) is
2 Plaintiff's Motion for Preliminary Injunction (DN 4) is
3. Plaintiff's Motion for Leave to File a Sur-Reply (DN 25) is
QSR Automations, Inc. v. KRS Corp. LLC, No. 3:09CV-242-S, 2010 WL 1416700, at *3 (W.D. Ky. Mar. 31, 2010).