Lifted Limited, LLC v. Novelty Inc.

Filing 275

ORDER by Chief Judge Philip A. Brimmer on 9/30/2021, re: 200 Novelty Inc.'s Motion to Decline Subject Matter Jurisdiction for Illegality is DENIED. (sphil, )

N THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Chief Judge Philip A. Brimmer
Civil Action No. 16-cv-03135-PAB-GPG
LIFTED LIMITED, LLC, a Colorado limited liability company,
Plaintiff,
v.
NOVELTY INC., an Indiana corporation, and
WALMART INC., a Delaware corporation,
Defendants.
_____________________________________________________________________
ORDER
_____________________________________________________________________
This matter is before the Court on defendant Novelty Inc.’s Motion to Decline
Subject Matter Jurisdiction for Illegality [Docket No. 196].
I. BACKGROUND
Plaintiff Lifted Limited, LLC is the assignee of U.S. Design Patent No. 662,655
(the ’655 Patent”), which covers the “ornamental design for a lighter holder and tool, as
shown and described” in the following seven figures:

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Docket No. 85-1 at 2-5. On December 20, 2016, plaintiff filed suit. See Docket No. 1.
The operative complaint alleges that the Midnight Smoker Utility Tool sold by
defendants Novelty Inc. (“Novelty”) and Walmart Inc. infringes the ’655 Patent. Docket
No. 67 at 7-12, ¶¶ 26-27, 40-41, 54-61. On May 27, 2020, the Court issued an order
construing the ’655 patent as an ornamental design for a lighter holder and tool as
shown in the figures above. Docket No. 162 at 17. On January 15, 2021, Novelty filed
the present motion, arguing that the Court should decline subject matter jurisdiction
over this dispute because the Toker Poker, the subject of the ’655 patent, is primarily
used for smoking marijuana, and marijuana is illegal under federal law. Docket No.
196.
II. LEGAL STANDARD
The Court first notes that Novelty fails to describe under what rule it seeks
dismissal. See generally id. Rather, Novelty simply states that the Court should
decline subject matter jurisdiction based “on the long-established grounds of subject
matter illegality to uphold the integrity of this Court and the sanctity of federal law.” Id.
at 1. Nonetheless, the Court finds that Federal Rule of Civil Procedure 12(b)(1) is the
most appropriate framework for analyzing Novelty’s motion. Dismissal pursuant to Rule
12(b)(1) is appropriate if the Court lacks subject matter jurisdiction over claims for relief
asserted in the complaint. Rule 12(b)(1) challenges are generally presented in one of
two forms: “[t]he moving party may (1) facially attack the complaint’s allegations as to
the existence of subject matter jurisdiction, or (2) go beyond allegations contained in the
complaint by presenting evidence to challenge the factual basis upon which subject
matter jurisdiction rests.” Merrill Lynch Bus. Fin. Servs., Inc. v. Nudell, 363 F.3d 1072,

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1074 (10th Cir. 2004) (quoting Maestas v. Lujan, 351 F.3d 1001, 1013 (10th Cir. 2003)).
Here, Novelty attacks the factual basis on which subject matter jurisdiction rests,
arguing that, based on the facts of this case, the Court does not have subject matter
jurisdiction over this patent dispute. See generally Docket No. 196. Accordingly, the
Court “may not presume the truthfulness of the factual allegations in the complaint, but
may consider evidence to resolve disputed jurisdictional facts.” SK Finance SA v. La
Plata County, 126 F.3d 1272, 1275 (10th Cir. 1997). “Ref erence to evidence outside
the pleadings does not convert the motion to dismiss into a motion for summary
judgment in such circumstances.” Id.
III. ANALYSIS
Novelty’s argument is that, because the Toker Poker is illegal drug
paraphernalia, enforcing plaintiff’s patent protections would be in furtherance of an
illegal act, and thus is barred by the illegality doctrine. See Docket No. 196. In
Novelty’s formulation, the illegality doctrine prevents a federal court from adjudicating a
dispute over the “fruits of a criminal enterprise.” See id. at 10-11. Although Novelty
provides no support for the use of this doctrine either in the patent context – particularly
a situation where there is a validly issued patent – or in the Tenth Circuit generally, the
Court finds that the Toker Poker is not illegal drug paraphernalia. Accordingly, the
Court need not resolve the applicability of the illegality doctrine to this case.
Pursuant to 21 U.S.C. § 863(a), it is illegal to: “(1) sell or offer for sale drug
paraphernalia; (2) to use the mails or any other facility of interstate commerce to
transport drug paraphernalia; or (3) to import or export drug paraphernalia.” 21 U.S.C.
§§ 863(a)(1)-(3). As relevant here, “drug paraphernalia” is defined as:

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any equipment, product, or material of any kind which is primarily intended
or designed for use in manufacturing, compounding, converting,
concealing, producing, processing, preparing, injecting, ingesting,
inhaling, or otherwise introducing into the human body a controlled
substance, possession of which is unlawful under this subchapter. It
includes items primarily intended or designed for use in ingesting,
inhaling, or otherwise introducing marijuana, cocaine, hashish, hashish oil,
PCP, methamphetamine, or amphetamines into the human body.
§ 863(d). Additionally, the statute lists fifteen categories of per se drug paraphernalia.
See §§ 863(d)(1)-(15). For example, “water pipes,” “bongs,” and “cocaine freebase
kits” are per se drug paraphernalia. See §§ 863(d)(2), (12), (15). Novelty does not
argue that the Toker Poker is per se drug paraphernalia, see generally Docket No. 196,
and the Court finds that it is not. As the claim construction order concluded, the Toker
Poker is an ornamental design for a lighter with various tools, including a tamper and a
poker. See Docket No. 162 at 17. Nothing in the list of per se items of drug
paraphernalia resembles a lighter holder, a tamper, or a poker. See §§ 863(d)(1)-(15).
However, even if an item is not per se drug paraphernalia, it may nevertheless
be considered as such if it is “primarily intended or designed for use in manufacturing,
compounding, converting, concealing, producing, processing, preparing, injecting,
ingesting, inhaling, or otherwise introducing into the human body a controlled
substance.” § 863(d). The statute lists eight factors which, “in addition to all other
logically relevant factors,” may be considered “[i]n determining whether an item
constitutes drug paraphernalia.” § 863(e). But, these factors are irrelevant if one of two
exceptions apply. The statute states that “[t]his section shall not apply to . . . (1) any
person authorized by local, State, or Federal law to manufacture, possess, or distribute
such items; or (2) any item that, in the normal lawful course of business, is imported,
exported, transported, or sold through the mail or by any other means, and traditionally
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intended for use with tobacco products, including any pipe, paper, or accessory.”
§§ 863(f)(1)-(2). The Court finds that the Toker Poker falls within the exception for items
“traditionally intended for use with tobacco products,” § 863(f)(2), and, as a result, is not
illegal drug paraphernalia pursuant to § 863.
The Toker Poker has three primary components: a lighter sheath, a tamper, and
a poker. See Docket No. 162 at 2, 10. All of these tools, however, are traditionally
associated with tobacco use. A tamper is a blunt instrument used to “tamp” down
tobacco when it is smoked in a pipe. A poker or “pick” is used to clear a tobacco pipe
of excess tobacco or to loosen tobacco that has been tam ped down too tightly. Finally,
a lighter sheath is an ornamental holder for a lighter. The United States Patent and
Trademark Office’s class specifically lists “cigarette lighter holder[s],” “pipe tampers,”
and “pipe cleaners” within Class 34 of its trademark classifications. See Docket No.
211-6 at 6. That these traditional items are combined into one package does not make
the Toker Poker any less “traditionally intended for use with tobacco products.”
§ 863(f)(2); see also Docket No. 211-2 at 12, ¶ 46 (“The Toker Poker is a holder
designed for a cigarette lighter, and the cleaning stick and tamper are traditionally
associated with tobacco pipes. It is a smoking tool accessory that can be used to clean
smoking pipes.”).
Novelty argues that plaintiff has never alleged “even a single instance of the
Toker Poker being used for anything other than marijuana.” See Docket No. 215 at 6.
Furthermore, Novelty contends that “all evidence and non-speculative testimony” states
that the “Toker Poker product is actually used as intended and marketed, i.e. in
connection with smoking marijuana.” Id. at 7. In support, Novelty cites United States v.

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Assorted Drug Paraphernalia Valued at $29,627.07 , 2018 WL 6630524, at *10 (D.N.M.
Dec. 19, 2018), for the proposition that plaintiff may not hypothesize potential tobaccorelated uses for the Toker Poker. Id. The Court finds this argument unpersuasive.
First, the tobacco exemption removes from § 863's purview any item that is
“traditionally intended” for use with tobacco, regardless of any of the other factors in the
statute. Section 863(f)(2) states that “[t]his section shall not apply” to products
traditionally intended for use with tobacco. Id. (emphasis added). Since a lighter
holder, a tamper, and a poker are all products traditionally intended for tobacco use,
regardless of any other uses they might have, plaintiff’s marketing does not change a
traditional use to a non-traditional one. As the Suprem e Court has stated, “[a]n item’s
‘traditional’ use is not based on the subjective intent of a particular defendant.” Posters
‘N’ Things, Ltd. v. United States, 511 U.S. 513, 520-21 (1994).
Second, Assorted Drug Paraphernalia is inapposite. There, the defendant had
eight categories of items seized: (1) “[p]ipes and smoking instruments”; (2) “[r]oach
clips”; (3) “[m]arijuana grinders”; (4) “[s]cales”; (5) “[n]ails and quartz bangers”; (6) “[f]lip
tops and glass vials”; (7) “[c]oncealment containers”; and (8) “[s]ynthetic urine kits and
detoxifiers.” Id. at *5. The court first found that several of these items “constitute per se
drug paraphernalia,” such as the roach clips and glass pipes. Id. In addressing the
tobacco exemption, the court found that the defendant provided no “meaningful
argument” on the issue, and that the sole argument he presented was that the items
“can [be] used for smoking tobacco.” Id. at *10. The court found that this hypothetical
tobacco use was insufficient. Id. In other words, it was a stretch to suggest that
tobacco is “‘traditionally’ smoked with a gas mask or any other items” found at the

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defendant’s property. Id. But there is no such issue here. Plaintiff’s product is a
tamper, cigarette holder, and poker, not a gas mask, grinder, water pipe, or anything
else that is not traditionally used to smoke tobacco. And while the court in Assorted
Drug Paraphernalia did say that the defendant could not hypothesize potential uses,
that was because the defendant made no argument that the products were traditionally
used for tobacco, and was only arguing that the items could be used for tobacco. Id. It
is not a mere hypothesis that lighter holders, tampers, and pokers are traditionally used
for tobacco. Novelty’s bare assertion otherwise based on plaintiff’s marketing and the
Toker Poker’s “new design,” Docket No. 215 at 6 – combining the traditional products
into one – is insufficient to demonstrate otherwise.
Accordingly, the Court finds that the Toker Poker is an item that is traditionally
used for tobacco and, as a result, is not drug paraphernalia pursuant to § 863.
Because the Toker Poker is not drug paraphernalia, Novelty’s illegality doctrine
argument necessarily fails and the motion will be denied.
IV. CONCLUSION
For the foregoing reasons, it is
ORDERED Novelty Inc.’s Motion to Decline Subject Matter Jurisdiction for
Illegality [Docket No. 196] is DENIED.
DATED September 30, 2021.
BY THE COURT:

______________________________
PHILIP A. BRIMMER
Chief United States District Judge

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