FAZE Apparel, LLC v. Faze Clan, Inc. et al

Filing 15

ORDER by Judge Lucy H. Koh Finding as Moot 11 Motion to Dismiss; Granting 12 Stipulation to Transfer. (lhklc1, COURT STAFF) (Filed on 3/8/2018)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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SAN JOSE DIVISION

United States District Court
Northern District of California

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FAZE APPAREL, LLC,
Plaintiff,

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Case No. 18-CV-00625-LHK
ORDER GRANTING STIPULATION TO
TRANSFER

v.

Re: Dkt. No. 12
FAZE CLAN, INC.,
Defendant.

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Plaintiff Faze Apparel, LLC (“Plaintiff”) filed this trademark infringement case against

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Defendant Faze Clan, Inc. (“Defendant”) on January 29, 2018. ECF No. 1 (“Compl.”). On

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February 12, 2018, Defendant filed a motion to dismiss, stay, or in the alternative, to transfer to

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the Central District of California. ECF No. 11 (“Mot.”). On February 23, 2018, the parties filed a

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stipulation to transfer this case to the Central District of California pursuant to 28 U.S.C.

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§ 1404(a). ECF No. 12.

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Section 1404(a) states: “For the convenience of parties and witnesses, in the interest of

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justice, a district court may transfer any civil action to any other district or division where it might

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have been brought or to any district or division to which all parties have consented.” The purpose

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of Section 1404(a) is to “prevent the waste ‘of time, energy and money’ and ‘to protect litigants,

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Case No. 18-CV-00625-LHK
ORDER GRANTING STIPULATION TO TRANSFER

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witnesses, and the public against unnecessary inconvenience and expense[.]’” Van Dusen v.

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Barrack, 376 U.S. 612, 616 (1964) (quoting Continental Grain Co. v. Barge FBL-585, 364 U.S.

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19, 26, 27 (1960)).

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When determining whether a transfer is proper, a court must employ a two-step analysis. A

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court must first consider the threshold question of whether the case could have been brought in the

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forum to which the moving party seeks to transfer the case. See Hoffman v. Blaski, 363 U.S. 335,

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344 (1960); see also Hatch v. Reliance Ins. Co., 758 F.2d 409, 414 (9th Cir. 1985) (“In

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determining whether an action might have been brought in a district, the court looks to whether the

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action initially could have been commenced in that district.” (internal quotation marks and
citations omitted)). Once the party seeking transfer has made this showing, district courts have

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United States District Court
Northern District of California

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discretion to consider motions to change venue based on an “individualized, case-by-case

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consideration of convenience and fairness.” Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29

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(1988) (quoting Van Dusen, 376 U.S. at 622). “No single factor is dispositive, and a district court

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has broad discretion to adjudicate motions for transfer on a case-by-case basis.” Ctr. for

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Biological Diversity v. Kempthorne, No. 08-1339, 2008 WL 4543043, at *2 (N.D. Cal. Oct. 10,

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2008) (citing Stewart Org., Inc., 487 U.S. at 29; Sparling v. Hoffman Constr. Co., Inc., 864 F.2d

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635, 639 (9th Cir. 1988)).

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At the first step of the two-part inquiry into whether transfer would be appropriate, the

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Court must consider whether the case could have been brought in the putative transferee district,

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here the Central District of California. The Court finds that this action could have been brought in

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the Central District of California. Defendant’s principal place of business is in Los Angeles,

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California, Compl. ¶ 7, and Defendant filed a closely related case against Plaintiff in the Central

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District of California the day after the instant case was filed. Mot. at 3-4; ECF No. 11-2.

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At the second step, the Court concludes that factors of convenience and fairness favor

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transfer for three reasons. First, there is substantial overlap between the subject matters of the

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Central District action and the instant case. The cases are between the same parties and arise out

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of the same dispute over the same mark. See ECF No. 11-2. It would be more efficient and

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Case No. 18-CV-00625-LHK
ORDER GRANTING STIPULATION TO TRANSFER

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convenient for one judge to decide the instant case and the pending case in the Central District of

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California to avoid inconsistent rulings.

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Second, the instant suit, although first filed, appears to have been an anticipatory suit

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triggered by Defendant’s transmission of a settlement offer that included a threat to file the Central

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District suit. See ECF No. 11-2 at 5-34; Xoxide, Inc. v. Ford Motor Co., 448 F. Supp. 2d 1188,

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1193 (C.D. Cal. 2006) (anticipatory suits arise when a plaintiff in the first-filed action files suit

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“on receipt of specific, concrete indications that a suit by the defendant was imminent”). Courts

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recognize an exception to the first to file rule for anticipatory suits because a “plaintiff should not

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be deprived of its traditional choice of forum because a defendant with notice of an impending suit
first files a declaratory relief action over the same issue in another forum.” Inherent.com v.

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United States District Court
Northern District of California

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Martindale-Hubbell, 420 F. Supp. 2d 1093, 1097 (N.D. Cal. 2006). Accordingly, where an

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“‘action has been triggered by a cease and desist letter’ that both seeks settlement and notifies the

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party of the possibility of litigation upon collapse of negotiations, ‘equity militates in favor of

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allowing the second-filed action to proceed to judgment rather than the first.’” Xoxide, 448 F.

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Supp. 2d at 1193 (quoting Z-Line Designs, Inc. v. Bell’O Int’l LLC, 218 F.R.D. 663, 667 (N.D.

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Cal. 2003)).

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Third, the parties in this case have stipulated to this case’s transfer to the Central District of

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California, which is strong evidence that the convenience of the parties would be served by

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transfer.

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Accordingly, the Court in its discretion finds that transferring the case to the Central

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District, where Defendant is based, where another case between the parties is pending, and where

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the parties have stipulated to transfer, will be the most efficient course and will serve the interest

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of justice. The Court GRANTS the parties’ stipulation to transfer the case to the Central District,

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ECF No. 12, and DENIES AS MOOT Defendant’s motion to dismiss, stay, or transfer, ECF No.

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11. The Clerk shall transfer the case and close the case file in this district.

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IT IS SO ORDERED.

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Case No. 18-CV-00625-LHK
ORDER GRANTING STIPULATION TO TRANSFER

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Dated: 3/8/18
______________________________________
LUCY H. KOH
United States District Judge

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United States District Court
Northern District of California

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Case No. 18-CV-00625-LHK
ORDER GRANTING STIPULATION TO TRANSFER