SIMANDLE, Chief Judge:
This is a trademark infringement action filed by Formula One Licensing BV and Formula One World Championship Limited (collectively, "Formula One") against various related corporate and partnership entities along with their owner, Richard J. Valentine. Broadly, Formula One alleges that Defendants conduct kart racing and other businesses under various "F1" names (F1 New Jersey, F1 Boston, F1 Outdoors, F1 Long Island, and F1 Hospitality and related domain names), and in so doing, have infringed upon Plaintiffs' rights to the "F1" and "FORMULA 1" word and design marks which are key components of the F1 brand.
The issue presently before the Court, however, is a narrow one. In response to Defendants' challenge to this Court's personal jurisdiction, Plaintiffs have moved for discovery to determine the nature and scope of the contacts that the moving Defendants — specifically, Kart Management Group, LLP, Karting America LLC, RJV Enterprises LLC, New England Kart Raceway, Inc., and Richard J. Valentine — have with New Jersey. Defendants argue that Plaintiffs have not alleged with reasonable particularity the possible existence of minimum contacts with New Jersey and have not met their burden for jurisdictional discovery. For the reasons that follow, the Court will grant in part and deny in part Plaintiffs' motion. Discovery will be permitted to determine whether the Court
The Formula One Plaintiffs own and license the "F1" and "FORMULA 1" word marks and the "F1" design mark depicted below ("the F1 Marks"), which are used in connection with the annual FIA Formula One World Championship ("F1 Championship") motor sport race:
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(Am. Compl. [Docket Item 18] ¶¶ 1, 9-10.) Plaintiffs allege that Richard J. Valentine, along with a number of interrelated business entities allegedly owned and managed by Valentine, have wrongfully exploited these marks for their own commercial purpose by conducting and advertising kart racing and other businesses under "F1 ___" names such as F1 Boston, F1 Outdoors, F1 Hospitality, and F1 Karting New Jersey, with the following design marks which Plaintiffs contend are confusingly similar to Formula One's:
Plaintiffs bring this action under the Lanham Trademark Act, 15 U.S.C. § 1114(1), complaining that Valentine and his companies have co-opted the F1 Marks to brand motorsport facilities in New Jersey, Massachusetts, and New York, and merchandise sold at those facilities; along with race cars, aircraft, airplane hangars, other vehicles and uniforms, and services ranging from hospitality services to private aircraft chartering. (
A number of parties entered into settlement agreements,
Defendants moved to dismiss for lack of personal jurisdiction, or in the alternative, to transfer venue to the District of Massachusetts, because Valentine is a resident of Massachusetts and the Defendant entities have their principle places of business in that state.
Plaintiffs seek jurisdictional discovery over the remaining Defendants in this case to determine their connections to New Jersey. As will be discussed below, all four are connected to Defendant Valentine. Plaintiffs also seek discovery over "which entities in Defendant Valentine's web should be named as defendants in order for Formula One to obtain redress for the widespread infringement of its valuable trademark rights." (Mot. for Jurisd. Disc. at 14.)
The Court must decide whether Plaintiffs have shown the possible existence of requisite contacts between each of these Defendants and New Jersey to entitle them to jurisdictional discovery. From the documents submitted by both parties, the Court notes that the main alleged site of infringing activity in New Jersey appears to be New Jersey Motorsports Park, a motorsports and entertainment park in Millville, New Jersey. The park included a kart-racing facility called the "F1 New Jersey" with the following logo:
"F1 New Jersey, LLC" was named as an original defendant but they have since settled with Plaintiffs, and the name of the racetrack has since been changed.
In their motion and related submissions, Plaintiffs assert the following contacts for each of the Defendants:
The Court notes at the outset that Defendants did not contest this Court's jurisdiction over Valentine in their motion to dismiss. (Mot. to Dismiss [Docket Item 22] at 9 n.9; Mot. for Jurisd. Disc. at 14.) Plaintiffs, however, seek discovery to find additional businesses in "Valentine's web" that could be named as defendants.
Valentine is a professional race car driver and entrepreneur and is a resident of Massachusetts with his primary business office in that state. He used to own a Massachusetts-based company called The MBA Group, LLC that focused on investing in startup companies; that company was dissolved in 2012. Valentine has owned and continues to own a variety of companies which provide services and goods in different areas, and uses the name "MBA Group" from time to time as an informal trade name to refer to his various business enterprises. Unlike The MBA Group, LLC, the informal trade name "MBA Group" is not a legal entity. (Valentine Cert. in Supp. of Mot. to Dismiss ("Valentine Cert.") [Docket Item 22-2] ¶¶ 5-7.) The "MBA Group" website and Valentine's personal website together list the four entity Defendants that are the subject of this motion among their "Companies and Partners" or "Current Business Ventures." (Pearson Decl. in Supp. of Mot. for Jurisd. Disc. [Docket Item 33] ¶¶ 8-9 & Exs. A & B.)
Valentine and three partners built and opened New Jersey Motorsports Park in Millville, New Jersey. The park is promoted on the website <www.njmp.com>. (Valentine Cert. ¶ 29; Pearson Decl. ¶ 11.)
Valentine asserts that he is the co-manager of an unidentified entity that holds a minority interest in New Jersey Motorsport Park LLC, which manages the park. He asserts that his co-investors run the business and his involvement "is only with major decisions." (Valentine Cert. ¶ 11; Pearson Decl. ¶¶ 9-11.)
Karting America is a limited liability company organized under the laws of Massachusetts
(Valentine Cert. ¶ 13; Am. Compl. ¶ 14.) Valentine holds a 13.5% membership interest in Karting America, and, as noted below, Defendant Kart Management, whose sole partner is Valentine, holds a majority ownership. (Valentine Cert. ¶¶ 15, 31.)
Karting America has no physical presence in New Jersey. It operates F1 Boston, a go-kart racetrack and conference center in Braintree, Massachusetts. Nearly all of F1 Boston's customers are from Massachusetts. The company does not offer goods or services for sale in New Jersey, nor does it advertise in New Jersey. (
Karting America owns the website <f1boston.com>, which promotes its F1 Boston racetrack and conference center. Although parties may submit information regarding reservations, customers cannot book an event or make a reservation using the website. The website sells gift cards to the F1 Boston facility, but customers cannot otherwise purchase goods or services through the website. (Valentine Cert. ¶¶ 22-25 & Ex. A; Pearson Decl. ¶ 24 & Ex. I.)
Plaintiffs offer the following facts to demonstrate that Karting America's contacts with New Jersey:
Kart Management is a Massachusetts company headquartered in Braintree, Massachusetts. It has no physical presence in New Jersey, nor does it conduct any business in New Jersey. It does not offer
Kart Management owns a majority interest in Karting America d/b/a F1 Boston (Valentine Cert. ¶ 15), and F1 Boston's website notes Kart Management Group is responsible for "all aspects of the management of F1 Boston," "including operations, sales, advertising, marketing, and financial controls." (Pearson Reply Decl. ¶ 6 & Ex. B.)
RJV Enterprises is a Massachusetts-based limited liability company with the primary business of selling go-karts and go-kart parts imported from Italy and Germany. Valentine is the majority owner and manager of RJV. (Valentine Cert. ¶¶ 34, 36; Pearson Decl. ¶ 31 & Ex. M.) Less than 5% of its go-kart and equipment sales are to karting facilities in New Jersey. (Valentine Cert. ¶¶ 37-40.)
Defendants allege that RJV has no physical presence in New Jersey and does not advertise in New Jersey. Plaintiffs attach an April 2010 article from what appears to be a kart-racing news website reporting that RJV's businesses include New Jersey Motorsport Park, F1 Boston, and F1 Outdoors, and a business called RIMO USA, which imports and distributes race karts. RIMO's website, in turn, contains links to several "F1" businesses, including F1 Outdoors and the racetrack at New Jersey Motorsports Park. (Pearson Reply Cert. ¶¶ 7-8 & Exs. C & D.)
One of RJV's three divisions operates under the name "F1 Hospitality" with the following logo:
F1 Hospitality leases a hospitality trailer for use at sporting and entertainment events, and Plaintiffs allege it has been booked for events at New Jersey Motorsport Park and other venues in New Jersey. (Pearson Decl. ¶ 30; Valentine Cert. ¶ 35.) F1 Hospitality also had a website on which it advertised its services, which was registered to Valentine's now-dissolved company. (Valentine Cert. ¶ 6; Pearson Decl. ¶¶ 30-31 & Ex. F.)
NE Kart Raceway is incorporated under the laws of Massachusetts with Valentine as its principal shareholder. (Valentine Cert. ¶ 41; Pearson Decl. ¶ 33.) It does business under the "F1 Outdoors" name and the following logo:
The company has no physical presence in New Jersey. It does not advertise in New Jersey or offer goods or services for sale in the state. (Valentine Cert. ¶¶ 43-46.)
NE Kart Raceway operates F1 Outdoors, a go-kart racetrack in East Bridgewater, Massachusetts, which attracts primarily Massachusetts residents but has also attracted out-of-state visitors, including visitors from New Jersey. (Pearson Decl. ¶ 35.) In 2013, a series of kart races called the RMAX Challenge was held at five kart-racing sites in different states.
Similar to F1 Boston's website, the F1 Outdoors website is used to promote and provide information about its racetrack, but does not sell goods or services. Customers cannot book an event or make a reservation through the website but can submit information for booking. (Valentine Cert. ¶¶ 48-51; Pearson Decl. ¶ 34; Pearson Ex. O.)
Plaintiffs also note that F1 Boston, F1 Outdoors, and New Jersey Motorsports Park all identify each other as sponsors or affiliates on their websites, or provide links to the other's site. F1 Boston's website also identifies F1 Hospitality as a sponsor and partner. (Pearson Decl. ¶¶ 24, 25, 32-34 & Exs. I, J, & O.)
In his certification in connection with Defendants' motion to dismiss, Valentine asserted that he "is the co-manager of a New Jersey entity that has a minority interest in NJ Motorsport." (Valentine Cert. ¶ 11.) In an earlier certification filed with the Court, Valentine stated that he owned interest in two separate companies that have a combined 21% interest in New Jersey Motorsports Park, LLC. (Valentine Cert. to First Mot. to Dismiss [Docket Item 11-1] ¶¶ 12, 32.) Plaintiffs assert that counsel for Defendants have refused to identify these entities, which Plaintiffs have dubbed John Doe Companies I, II, and III, by name. (Pearson Decl. ¶ 17.)
Although the plaintiff bears the burden of demonstrating sufficient contacts between the defendant and the forum state to support the exercise of personal jurisdiction,
Thus, courts in this Circuit have permitted jurisdictional discovery where the jurisdictional facts "remain in dispute,"
Ultimately, to meet its burden on a motion to dismiss under Fed. R. Civ. P. 12(b)(2), the plaintiff must proffer evidence of jurisdiction through sworn affidavits or other competent documents.
The personal jurisdiction inquiry traditionally requires an examination of whether its exercise over a defendant is permissible under both the state's long-arm statute and the Due Process Clause of the Constitution. But if the state's personal jurisdiction statute permits the exercise of jurisdiction to the fullest limits of due process, as is the case here, the two jurisdictional inquiries in this case collapse into one: whether the exercise of jurisdiction comports with due process.
As has often been repeated, the Due Process Clause of the Constitution permits the exercise of personal jurisdiction when there are "minimum contacts" between a non-resident defendant and the forum state such that "maintenance of the suit does not offend traditional notions of fair play and substantial justice."
Because the Federal Rules and this Circuit permit liberal discovery of jurisdictional facts which are relevant and not privileged,
Plaintiffs have proffered at least some evidence that Karting America d/b/a F1 Boston, though based out of Massachusetts, has some connections to New Jersey, but it falls well below the requisite threshold for establishing general jurisdiction.
Nonetheless, the Court will permit limited discovery because some of Plaintiffs' allegations suggest that specific jurisdiction may exist. First, the 2008 press release submitted by Plaintiffs appears to suggest that a company known as the "F1 Boston Group" partnered with Valentine in the creation of the F1 New Jersey kart-racing facility at New Jersey Motorsports
Second, Plaintiffs have submitted evidence of cross-promotion between the Defendant entities. The evidence of cross-promotion between each Defendant and New Jersey Motorsports Park is particularly relevant. F1 Boston's website identifies New Jersey Motorsports Park as a sponsor and it promoted New Jersey Motorsports Park in a single Facebook post. While this still falls short of demonstrating that Defendant had "continuous and systematic contacts" with New Jersey, it does suggest that F1 Boston exploited the "F1" brand and marks by encouraging visitors who were familiar with F1 Boston to patronize the F1 New Jersey in Millville. Plaintiffs have, in other words, provided facts implying that Defendant F1 Boston purposefully directed some activity to New Jersey that supported the infringing entity in the state, causing injury to Plaintiffs. Additionally, the evidence of cross-promotion between the entity Defendants and New Jersey Motorsports Park may point to the existence of an underlying contract between the parties to promote each other's go-kart facilities. Such a contract would indicate that F1 Boston "deliberate[ly] target[ed] [] the forum" by promoting F1 Boston with New Jersey residents visiting New Jersey Motorsports Park, and would support a finding of specific jurisdiction.
Accordingly, because Plaintiffs have provided some evidence to suggest that specific jurisdiction may be established, the Court will permit discovery to determine whether Karting America has contacts with New Jersey specific to the cause of action in this case. In particular, discovery should be related to (1) the nature and scope of Karting America's connection and involvement with "F1 Boston Group" and with New Jersey Motorsport Park; (2) the existence of any contracts or agreements between Karting America d/b/a F1 Boston and New Jersey Motorsports Park to advertise its services and products, and (3) the extent of cross-promotion between the Defendants. If discovery within these identified fields leads to the prompt identification of other limited discovery reasonably needed for a fair determination of specific jurisdiction, that too may be permitted.
For many of the same reasons, the Court will also permit limited discovery into NE Kart Raceway d/b/a "F1 Outdoors" relevant to establishing specific jurisdiction. A broader inquiry is not required
Like Karting America, NE Kart Raceway's business is operating a go-kart facility in Massachusetts. It does not sell products or services directly in New Jersey, does not have employees, officers, or business records in the state, and does not solicit business in the state. It is likely that F1 Outdoors has attracted at least some visitors from New Jersey over the past few years through their participation in 2013 in the five-state RMAX Challenge. Without more, these allegations do not come close to showing general jurisdiction.
The Court cannot, however, rule out the possibility of specific jurisdiction, because Plaintiffs have pointed to facts which at least cast some doubt on Defendants' statement that F1 Outdoors does not advertise or promote its business in New Jersey. The fact that Defendant's website advertised F1 Outdoors as a race site in the RMAX Challenge (and noted the location of other race sites) suggests that it may have promoted or encouraged attendance at races at the other Challenge locations, including at F1 New Jersey. F1 Outdoors' website also provided a link to the website of New Jersey Motorsports Park, and in turn, the New Jersey Motorsports Park website linked to F1 Outdoors. As noted above, such cross-promotion could suggest an underlying agreement between the parties to promote each other's businesses. Discovery may reveal that F1 Outdoors purposefully directed business towards F1 New Jersey, or targeted advertisements for F1 Outdoors at New Jersey residents, either directly or through an agreement with New Jersey Motorsports Park.
Because Plaintiffs have shown that discovery would not be frivolous, the Court will permit limited discovery for purposes of determining whether the Court may exercise specific jurisdiction over NE Kart Raceway. In particular, discovery will be permitted to examine (1) the existence of any contracts or agreements between NE Kart Raceway d/b/a F1 Outdoors and New Jersey Motorsports Park to advertise its services and products, and (2) the extent of cross-promotion between the parties. Additional discovery beyond the scope of these fields may be permitted at the Court's discretion if this discovery leads to areas for reasonable follow-up if likely to be probative of specific jurisdiction.
The Court will also permit limited discovery into RJV Enterprises d/b/a "F1 Hospitality" for purposes of establishing specific jurisdiction.
Plaintiffs have been unable to allege more because Defendants have provided virtually no information on F1 Hospitality or its services. With respect to F1 Hospitality, Valentine's certification asserts only that "One of RJV's three business divisions does business as `F1 Hospitality,' and its business is leasing out of Massachusetts a hospitality trailer for customers to use at entertainment events, used by customers anywhere they wish to entertain." (Valentine Cert. ¶ 35.) Defendants do not state how much of F1 Hospitality's revenue may be attributed to customers in New Jersey, whether F1 Hospitality purposefully solicits business in the state, or whether RJV had knowledge that its trailer with the allegedly infringing logo was being used for these commercial purposes in New Jersey. Valentine's certification discusses only RJV and its contacts, even though Plaintiffs' claim of infringement is directed towards use of the "F1 Hospitality" mark on trailers provided by F1 Hospitality.
An inquiry into F1 Hospitality and its specific contacts with New Jersey is critical to determining whether this Court has specific jurisdiction over RJV. In order to meet Defendants' jurisdictional challenge under Fed. R. Civ. P. 12(b)(2), Plaintiffs must provide affidavits or other competent evidence to establish the existence of jurisdiction.
In addition, Plaintiffs have produced a news article reporting that New Jersey Motorsports Park is one of RJV's businesses, suggesting that RJV may have a financial stake in the operation of New Jersey Motorsport Park and the F1 New Jersey racetrack. Such a finding would almost certainly support the exercise of specific jurisdiction over RJV.
"When the fish is identified, and the question is whether it is in the pond, we know no reason to deny a plaintiff the customary license."
Finally, the Court will grant jurisdictional discovery to identify the names of the John Doe Defendants. Since Plaintiffs assert that these defendants are entities that co-manage or have an interest in New Jersey Motorsports Park, their connection
The Court will exert personal jurisdiction over the above Defendants to the extent necessary to require them to provide this limited specific-jurisdiction related discovery. The period for jurisdictional discovery shall be 45 days. Within 7 days thereafter, Plaintiffs may file a letter request to lift the stay on Defendants' motion to dismiss along with serving an opposition to Defendants' motion. Defendants' reply will be due 7 days thereafter.
Plaintiffs have not shown with reasonable particularity that Kart Management may be subject to jurisdiction in New Jersey. Defendants have stated that Kart Management does not have a presence in New Jersey, does not conduct business in New Jersey, and does not offer goods or services for sale in the state. Although Plaintiffs note that Kart Management owns a majority interest in Karting America and is responsible for the management of F1 Boston, that activity does not establish Kart Management's contacts with New Jersey.
Discovery will not be granted as a matter of course simply because a plaintiff has named a particular party as a defendant. The Court must be satisfied that there is some indication that this particular defendant is amenable to suit in this forum. Here, the record is devoid of any evidence that Kart Management has even a single direct connection with the forum state. Accordingly, the Court will deny jurisdictional discovery.
Plaintiffs seek to propound discovery on Valentine to find out "which entities in Defendant Valentine's web should be
The Court finds no reason to permit a thinly-veiled fishing expedition into all of Valentine's companies and business interests. Plaintiffs have not demonstrated that they have met the requirement for jurisdictional discovery, as they have not shown with any "reasonable particularity" that Valentine owns other companies, not yet known to Plaintiffs, that are infringing on the Formula One Marks and that have sufficient ties to New Jersey. More importantly, aside from John Doe Companies I-III, whose identities are already subject to discovery, Plaintiffs have not named any other defendants. The Court cannot order jurisdictional discovery to uncover whether parties who are not even named in this suit have New Jersey contacts.
More importantly, as Plaintiffs themselves point out, Valentine has not contested personal jurisdiction in this case. Jurisdictional discovery is intended to clarify and resolve disputes over a defendant's requisite contacts with a state. Here, there is no dispute: because Valentine waived his personal jurisdiction defense, he is subject to suit in New Jersey. Jurisdictional discovery on Valentine to discover other of his companies would serve no purpose in establishing the Court's jurisdiction over him. In denying discovery, the Court does not rule out that Valentine may be required to provide information in connection with jurisdictional discovery over other entity Defendants discussed above.
Jurisdictional discovery will be permitted with respect to Karting America, NE Kart Raceway, and RJV Enterprises to determine whether the Court may establish specific jurisdiction over these Defendants. Jurisdictional discovery will also be permitted to determine the identities of the several unnamed John Doe defendant entities that own interests in New Jersey Motorsports Park, which Plaintiffs have captioned "John Doe Companies I-III." Jurisdictional discovery will be denied with respect to Kart Management and Richard Valentine.
Plaintiffs' Proposed Interrogatories and Requests for the Production of Documents [Docket Item 32] shall be revised to confine to the issues noted in this Opinion and the Court's accompanying Order. Defendants' time to respond will be expedited to 14 days. The period for jurisdictional discovery shall be 45 days. Within 7 days thereafter, Plaintiffs may file a letter request to lift the stay on Defendants' motion to dismiss along with an opposition to Defendants' motion. Defendants' reply will be due 7 days thereafter.
