Jurisdiction and Venue

August 7, 2012

Wine & Canvas Litigation Narrowed and Clarified by Court

Indianapolis, IN – The Southern District of Indiana dismissed multiple claims by Plaintiff Wine & Canvas in its trademark infringement suit against YN Canvas, et al.

Wine & Canvas organizes parties where guests can take a painting class while enjoying cocktails. Anthony Scott (“Scott”), one of the founders of Wine & Canvas, sued multiple defendants. He alleged that he entered into a business venture wherein he would license the Wine & Canvas business model to Christopher Muylle (“Muylle”) and Theodore Weisser (“Weisser”) for use in San Francisco, both to operate a new Wine & Canvas location and to license others to operate under the Wine & Canvas name and business model. Instead, Scott alleged, the defendants breached that agreement, appropriated the Wine & Canvas model and proceeded without Scott as YN Canvas CA, LLC (“YN Canvas”). Defendants, in turn, alleged that they breached no agreement but instead merely parted ways, changing their business name to “Art Uncorked,” when Wine & Canvas insisted on a new agreement with additional terms that were unfavorable to the defendants.

Plaintiff Wine & Canvas Development, LLC (“Wine & Canvas”), via its attorneys, sued multiple defendants: (1) YN Canvas, a Nevada limited liability company with its principal place of business in California; (2) www.art-uncorked.com, the corporate website for Art Uncorked; (3) Weisser, an officer of YN Canvas; and (4) Muylle, an officer of YN Canvas (collectively, “defendants”). [NB: Art Uncorked was also named as a defendant but, as that was merely the new name of YN Canvas, which had already been named as a defendant, the court chose to refer to both by the one name, “YN Canvas.”]

The eleven-count complaint was originally filed in Hamilton County Circuit Court and included claims for trademark infringement, false designation of origin, trademark dilution, sales of counterfeit items/services, unfair competition, declaratory judgment, civil action under the Indiana Crime Victims Act, breach of contract, fraud, permanent injunctive relief, and request for writ of attachment. It was removed to the Southern District of Indiana as its Lanham Act issues provided federal question jurisdiction. We previously blogged about that element of this case here.

The parties came to the court with several motions. After a detailed discussion on personal jurisdiction, the court held that it could exercise specific jurisdiction over both Weisser and YN Canvas and denied the motion to dismiss for lack of personal jurisdiction as to them. The motion to dismiss the website as a defendant was granted, with the court finding that, “[b]ased on common sense and Indiana precedent, it is obvious to this Court that a website alone is not an entity capable of being sued.”

The court declined to discuss jurisdiction regarding “Art Uncorked,” finding that it was merely the new name of YN Canvas and, as such, it need not be considered separately. Any references to YN Canvas would also apply to Art Uncorked.

The court then moved to the defendants’ 12(b)(6) motions to dismiss for failure to state a claim. Two counts – trademark infringement under 15 U.S.C. § 1114(1)(a) and use of a counterfeit mark under 15 U.S.C. § 1116(d) – were dismissed. Each of those claims required a registered mark, which Wine & Canvas conceded it did not have. However, the court dismissed the counts without prejudice, as the registration of the marks is pending.

The court next moved to two “counts” – permanent injunction and attachment – and dismissed them summarily as inappropriate pleading. “Because these remedies are based on causes of actions in other counts within the Wine & Canvas’s complaint and are included within the Wine & Canvas’s prayer for relief,” the court held, “it is unnecessary to dedicate a separate count for each specific remedy.”

Defendants next asked the court to dismiss the claim of fraud for failure to meet the heightened standard required for pleading fraud. As no time frame or location of the alleged fraud had been included in the plaintiff’s complaint, the court dismissed the fraud claim without prejudice.

Finally, as with the “counts” for permanent injunction and attachment noted earlier, the court addressed another “count” by Wine & Canvas seeking a declaratory judgment. Ruling here on the defendants’ motion to strike, the court cited Federal Rule of Civil Procedure 12(f) allowing a court to strike “redundant, immaterial, impertinent, or scandalous matter” from any pleading and, again, held that the “count” was redundant, as appropriate remedies would be addressed in the adjudication of the substantive claims, and granted the defendants’ motion to strike.

Practice Tip #1: The decision to sue a website is a curious one and seems to be the modern-day equivalent of suing a book. It is notable that this has, however, happened. See, e.g., here. On the one hand, it is an attorney’s duty to pursue zealously his clients’ interests and, at times, that leads to maintaining a cause of action that is not a “sure thing.” On the other hand, the law is unambiguous that a website is neither a real person nor a legal entity capable of being sued and, thus, it would have been wiser to omit this “defendant.”

Practice Tip #2: The decision to include various remedies that a party is seeking as separate causes of action is also curious but, instead of zealous advocacy run amok, it merely seems to reflect improper drafting.
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July 31, 2012

CP Productions, Inc. Sues John Doe for copyright Infringement of Video: “GH Hustlers – Maryjane’s Second Visit”

By Overhauser Law Offices, LLC

Indianapolis IN – Copyright lawyers for CP Productions, Inc. of Phoenix, AZ filed a copyright infringement declaratory judgment suit in alleging John Doe, an alleged serial infringer known at this time only by an IP address, infringed the copyrighted work “GH Hustlers – Maryjane’s Second Visit” which has been registered by the US Copyright Office.

In the complaint filed by attorneys for CP Productions, John Doe and other un-named parties are believed to have infringed a copyrighted video belonging to CP Productions. CP Productions is a producer of adult entertainment and seeks judgment against John Doe and others for the alleged serial infringement of the video “GH Hustlers–Maryjane’s Second Visit” to which the Plaintiff owns the copyright. John Doe and the joint tortfeasers are not known by name but rather, through their IP address and attorneys for CP Productions will be filing a Motion for Leave to Take Discovery in order to ascertain the actual identities of the Defendants from their ISPs. CP Productions is seeking judgment from counts including copyright infringement, civil conspiracy, and contributory infringement. CP Productions claims to have observed John Doe’s infringing multiple copyrighted content through agents the Plaintiff has employed using the BitTorrent protocol because the Plaintiff employs P2P netword forensic software to provide real time monitoring of the BitTorrent swarm that distributes the video. This software allowed CP Productions to log John Doe and the joint tortfeasers unlawful activities. CP Productions further alleges that John Doe and the joint tortfeasers intentionally downloaded a torrent file particular to the Plaintiff’s video, purposefully uploaded the torrent into their BitTorrent clients and entered a BitTorrent swarm particular to the Plaintiff’s video and reproduced and distributed the copyrighted video among themselves and third parties thereby becoming both and uploader and downloader of the video. By doing so, CP Productions claims that this “ever growing swarm will jointly contribute to the complete download of the Video for all individuals that enter the swarm at any given moment.” CP Productions believes that this lawsuit is the only practical means by which to combat BitTorrent based infringement. Because the damage claimed by CP Prodcutions includes economic and reputation losses, to which Plaintiff asserts will continue, the Complaint sets out demand for actual or statutory damages allowed under the Copyright Law, compensatory damages for the counts of civil conspiracy and contributory infringement, and an order or impoundment for all copies of Plaintiff’s works, photographs or other materials in the Defendant’s possession or control.

Practice Tip: The BitTorrent protocol is a decentralized method that allows users to distribute data via the Internet, and has become an extremely popular method for unlawful copying, reproducing and distributing files in violation of the copyright laws. Where this market was once consumed by music copyright violations, the adult entertainment industry has seen an increase in litigation against infringers using BitTorrent-based technology. Although no concrete rules govern jurisdiction of the Internet, Indiana’s long arm statute (Indiana Rule of Trial Procedure 4.4) permit personal jurisdiction of Defendants if they either downloaded or uploaded the copyrighted material.

April 27, 2012

Lippert Components Sues Actuant Corporation for Patent Infringement of Retractable Room Technology for Recreational Vehicles

By Overhauser Law Offices, LLC

South Bend; IN – Patent attorneys for Lippert Components of Goshen, Indiana filed a patent infringement suit in the Northern District of Indiana alleging Actuant Corporation of Menomonee Falls, Wisconsin, Versa Technologies of Milwaukee, Wisconsin and Engineered Solutions of Milwaukee, Wisconsin infringed patent no. 8,016,343 RETRACTABLE ROOM ACTUATION ASSEMBLY FOR RECREATIONAL VEHICLE, which has been issued by the US Patent Office.

The complaint states that the defendants displayed a new product, called “In-Wall Slide,” at a trade show in Kentucky in November and December 2010. Thereafter, Lippert notified the defendants that it had a patent application pending for the exact same technology utilized by the In-Wall Slide product. Lippert’s ‘343 patent was granted on September 13, 2011. The complaint states that the defendants again displayed the In-Wall Slide product at the 2011 trade show. Libbert alleges that the In-Wall Slide product infringes its ‘343 patent. The complaint makes one claim of patent infringement and seeks an injunction, damages, attorney fees and costs.

Practice Tip: The plaintiff has included an interesting fact to establish personal jurisdiction. The complaint alleges that Versa and Engineered Solutions operate a business in Mishawaka, Indiana called Power Gear.

April 17, 2012

Southern District Grants Motion to Transfer Venue for Combined Public Communications in Patent Case Over Phone Service To Jails

By Overhauser Law Offices, LLC

Indianapolis; IN – [Note – Overhauser Law Offices, LLC, publisher of this site, represented Combined Public Communications, who prevailed in this matter]

Judge Jane E. Magnus-Stinson of the Southern District of Indiana has granted a motion to change venue in a patent infringement suit. Patent attorneys for Securus Technologies of Dallas, Texas, had filed a patent infringement lawsuit in the Southern District of Indiana alleging that Combined Public Communications (“CPC”), based in Kentucky, infringed Securus’s March 1, 2011 patent no 7,899,167 for “CENTRALIZED CALL PROCESSING.” The patent claims to provide “a centralized architecture for call processing” including voice over internet protocols (VOIP).

Securus’s patent lawyers alleged in the complaint that the litigants are competitors because they each provide “specialized call-processing and billing equipment and services for correctional institutions, direct local and long distance call processing for correctional facilities,” and other technologies relating to “Inmate Management Systems.”

The court’s order transferring venue notes that T-Netix, Inc., a company that is part of the Securus corporate family, filed a patent infringement suit against CPC in the Western District of Kentucky making similar patent infringement claims. Weighing the relevant factors, the court concluded that the interests of justice and convenience to the parties and witnesses favored a transfer of venue to the Western District of Kentucky.

Practice Tip: 28 U.S.C. § 1404(a) sets the standard for transfer of venue: “For the convenience of parties and witnesses, 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.”

March 30, 2012

Buztronics sues Toy Investments, Inc. for Declaratory Judgment for Non-Infringement of Patents

By Overhauser Law Offices, LLC

Indianapolis, IN. Patent attorneys for Buztronics, Inc. of Indianapolis, Indiana have filed a patent suit seeking that three patents owned by Toy Smith Investments, Inc. of Sumner, Washington be declared invalid and not infringed by Buztronics’ products. The three patents, all entitled “WRIST TOY” are: 6,685,582, 6,971,963, and 7,833,115.

Buztronics alleges that Toysmith “accused Buztronics of infringement of Toysmith’s patent rights.”

Practice Tip: Declaratory judgment suits are often filed intellectual property cases after the first allegation of infringement is made. The strategy is for the accused infringer to obtain “home court advantage” by having the dispute litigated nearby. This makes it more expensive for the patent owner to litigate, because they must hire local counsel. Coincidentally, two days before Buztronics filed this suit, the Court of Appeals for the Federal Circuit issued an Order clarifying when threats of infringement rise to a level sufficient to trigger declaratory judgment jurisdiction. In 3M Company v. Avery Denison Corporation, the Court stated that declaratory judgment jurisdiction requires more than “a communication from a patent owner to a party merely identifying its patent and the other party’s product line.”

March 21, 2012

Southern District Grants Motion to Dismiss for Pacific Coast Breaker, Inc. in Trademark Infringement Suit Over Circuit Breakers with the ZINSCO Mark

By Overhauser Law Offices, LLC

Indianapolis, IN – The Southern District of Indiana has granted a Motion to Dismiss in a trademark infringement lawsuit filed by Connecticut Electric, Inc. of Anderson, Indiana alleging that Pacific Coast Breaker, Inc. of McClellan, California and and PC Systems, Inc., also of California, infringed trademark registration no. 975,845 for the mark ZINSCO registered with the US Trademark Office.

The suit involves circuit breakers sold by Pacific Coast that are manufactured in China by PC and sold only to Pacific Coast. The plaintiff claimed that Pacific previously purchased its breakers from Connecticut, but stopped purchasing circuit breakers from plaintiff and began selling circuit breakers that look “identical in appearance to the ZINSCO circuit breakers.” We previously blogged about the case here.

The court granted this motion to dismiss finding a lack of personal jurisdiction because neither of the California defendants had sufficient contact with Indiana. Connecticut had argued that there were sufficient contacts with Indiana because Pacific Coast had sold 648 circuit breakers to Indiana residents over the last five years. However, the court could not distinguish whether these Indiana sales were of the allegedly infringing product or of the authentic product. At most, the court believe only $3,780 worth of sales were allegedly infringing products, which the court concluded was not substantial enough to create personal jurisdiction.

Practice Tip: The court also rejected Connecticut’s argument for personal jurisdiction because Pacific committed intentional torts of trademark infringement, trade dress infringement, unfair competition, forgery, and counterfeiting which were directed into Indiana.

February 10, 2012

Keith Lewis v. Grote Industries, Patent Infringement Case over LED Lighting Devices, Transferred to the Southern District

By Overhauser Law Offices, LLC

New Albany, IN – A patent infringement case originally filed in the Northern District of Illinois has been transferred to the Southern District of Indiana. In October, patent lawyers for Keith Lewis of the United Kingdom filed a patent infringement suit in the Northern District of Illinois alleging Grote Industries, Inc. of Madison, Indiana infringed patent no. 7,252,407, Lighting apparatus, which has been issued by the US Patent Office.

The case has now been transferred to the Southern District of Indiana upon the motion of Grote Industries. The complaint alleges that twenty-one lamp model numbers offered for sale by Grote infringe upon the ‘407 patent. The complaint describes the allegedly infringing products as LED lighting devices and work lamps. Lewis’s patent attorneys seek a declaration of infringement, an injunction, and damages.

Practice Tip: In filing in the Northern District of Illinois, Lewis’s patent attorneys alleged that the defendant sold products in Illinois to argue that the Illinois district court had personal jurisdiction over Grote, an Indiana company. However, the complaint reveals few ties to Illinois, since the plaintiff is from the United Kingdom and the defendant is an Indiana company. Therefore, as the Northern District of Illinois concluded, Southern District of Indiana appears to be a more appropriate venue.
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December 2, 2011

SoftMaker and SEG Sue Third Scroll Copyright and Trademark Infringements of Computer Software Products.

By Overhauser Law Offices, LLC

Indianapolis, IN – A trademark and copyright infringement case filed in the Southern District of California has been transferred to the Southern District of Indiana. Intellectual property attorneys for SoftMaker and SEG, both of Nuremberg, Germany have filed a trademark and copyright infringement suit in the Southern District of California alleging that Third Scroll of Indianapolis, Indiana infringed trademark registration no. 3,051,159 for the mark SOFTMAKER and trademark registration no. 3,104,173 for the mark TEXTMAKER registered by the US Trademark Office. The case was transferred to the Southern District of Indiana on November 29.

The plaintiffs are software development companies. The complaint states the suit is based on the defendant’s production, importation and sale of hacked copies of the plaintiff’s software bearing the plaintiff’s trademarks. The complaint alleges that the defendants offered pirated copies of the plaintiff’s software online, including the programs Textmaker®, Planmaker®, and Softmaker Presentations®. The plaintiff states that its software is protected by U.S. copyright laws and international treaties recognizing copyrights. The copyrighted software also bears the plaintiff’s trademarks. The complaint makes claims of copyright infringement, “circumvention of copyright protection measures,” trademark infringement and counterfeiting, false designation of origin, and unfair competition.

Practice Tip: This case was originally filed in the Southern District of California. The only allegation of a connection to California in the complaint is that defendant’s website was accessible there. The defendant succeeded in getting the case transferred to Indiana, the domicile of the defendant company.
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November 17, 2011

Southern District Dismisses Patent Infringement Case over Motorcycle Suspension for Lack of Personal Jurisdiction

By Overhauser Law Offices, LLC

Indianapolis, IN – The Southern District of Indiana has dismissed a patent infringement lawsuit finding a lack of personal jurisdiction over a California company accusing of patent infringement. Patent lawyers for AirFx LLC of Indianapolis, Indiana filed a patent infringement lawsuit in the Southern District of Indiana alleging J.D. Braun, of Los Angeles, California, doing business as Goldenstate Custom Cycles, Dr. V-Twin, Inc. of Sherman Oaks, California, infringed Patent No. 7,559,396 B2, Motorcycle air suspension system, which has been issued by the US Patent Office. Indiana Intellectual Property Law and News blogged about the case when it was filed in July.

The California defendant moved to dismiss the complaint, arguing that the court lacked personal jurisdiction. Patent attorneys for AirFX had argued that the Indiana district court had personal jurisdiction because the company had a website that was accessible in Indiana and listed an Indiana store where its products could be purchased. Judge William T. Lawrence, writing for the court, held that “the mere existence of nationally-accessible websites is a poor foundation on which to base personal jurisdiction.” Thus the court dismissed the case with prejudice.

Practice Tip: This case reiterates that simply having a website that is accessible within a district does not create personal jurisdiction. In order to achieve personal jurisdiction, the plaintiff must establish “minimum contacts” with the district.
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October 24, 2011

Saeilo Sues Jacobson Hat Co. in Hamilton County for Trademark Infringement of Toy Tommy Guns: Case Removed to Federal Court

By Overhauser Law Offices, LLC

Indianapolis, IN – A trademark infringement case that was originally filed in Hamilton County Superior Court has been removed to the Southern District of Indiana. On September 14, 2011 trademark lawyers for Saeilo Enterprises, Inc. Pearl River, New York filed a trademark infringement suit in Hamilton County alleging Jacobson Hat Company, Inc. of Scranton, Pennsylvania infringed trademark registration no.2,885,628 for the words TOMMY GUN registered with the US Trademark Office and 20090707-13956, 20090707-13957 and 20090707-13958 for TOMMY GUN design registered trademarks in the State of Indiana State. Trademark attorneys for Jacobson filed notice of removal to have the case heard by the federal Southern District of Indiana, rather than the Hamilton County court, based upon the fact that Saeilo makes federal law trademark infringement claims.

The complaint alleges that Jacobson has distributed, advertised or sold toy guns bearing the Tommy Gun trademarks without Saeilo’s authorization. The complaint does not reveal any details of the allegedly infringing sales, advertising or distribution. However, a print-out of Jacobson’s website, dated October 2009 was attached to the complaint. The complaint makes claims of trademark infringement, trademark dilution, false designation of origin, false advertising, trade dress infringement, common law trademark infringement, unfair competition, counterfeiting, and Indiana state law trademark infringement.

Practice Tip: This is the third trademark infringement case in the past several months that Saeilo filed in Hamilton County court, only to be removed to federal court. In all three cases, Continental Enterprises, which is an Indianapolis corporation that claims to “non-traditional strategies to combat infringers domestically and around the globe and provide effective solutions for seemingly intractable IP problems,” has represented Saeilo. Indiana Intellectual Property Law and News has blogged about the two other cases: one was against BuzzBee Toys and the other was against Scottwerx. According to PACER, trademark attorneys have reached a settlement in the Buzz Bee case. The terms of the settlement are undisclosed. The Scottwerx case is still pending.
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