Kodner Estate Holdings, LLC v. Kodner Galleries, Inc.
Filing
34
Opinion Order Dismissing Case. Granting 26 Motion to Dismiss for Failure to State a Claim; Granting 26 Motion to Dismiss for Lack of Jurisdiction. Closing Case. Denied As Moot: [ 24 Amended Complaint, filed by Kodner Galleries, Inc., 29 MOTION for Leave to File Surreply to Motion to Dismiss filed by Kodner Estate Holdings, LLC. Signed by Judge Robert N. Scola, Jr on 1/14/2019. See attached document for full details. (cds)
United States District Court
for the
Southern District of Florida
Kodner Estate Holdings, LLC,
Plaintiff,
)
)
)
v.
) Civil Action No. 18-61299-Civ-Scola
)
Kodner Galleries, Inc., Gallery of the )
Masters, Inc., Defendants.
)
Opinion Order Dismissing Case
Before the Court is a motion to dismiss filed by Defendant Kodner
Galleries, Inc. (the “Motion,” ECF No. 26.) Having considered the Motion, all
supporting and opposing submissions (including the Plaintiff’s proposed
surreply, ECF No. 29-1), and the applicable law, the Court grants the Motion
and dismisses this case without prejudice, as further described below.
1.
Factual Background
Plaintiff Kodner Estate Holdings, LLC, filed suit on June 10, 2018,
against Defendant Kodner Galleries, Inc. (“Defendant Galleries”). (ECF No. 1.)
On September 7, 2018, the Plaintiff filed an Amended Complaint, adding
Defendant Gallery of the Masters, Inc. (“Defendant Masters”). (ECF No. 24.) To
date, Defendant Masters has not been served in this case. Plaintiff is aware of
and acknowledges the same. (See ECF No. 31 at p. 1.) Defendant Galleries
improperly moved to dismiss for Defendant Masters on this basis, (ECF Nos.
32, 33).
The Amended Complaint asserts federal jurisdiction under 15 U.S.C. §
1338, and 28 U.S.C. §§ 1338, 2201, and contains one count for “Declaratory
Relief as to Trademark Claims.” (ECF No. 24 at¶¶ 6, 33-37.) In opposition to
the Motion, the Plaintiff summarizes the nature of the relief it seeks: “[A]
determination of the parties’ respective rights under the Lanham Act and if any
of the parties are infringing on the other’s respective marks.” (ECF No. 27 at p.
2); see also (ECF No. 24 at ¶ 36 (seeking declarations of the parties’ rights to
use the word “Kodner,” if Plaintiff is “infringing on any trademark” by its use of
“JK” or “Joshua Kodner,” and “[a]ny other remaining controversy regarding the
respective rights held by the parties pursuant to the Lanham Act.”).) Notably,
the Plaintiff does not actually assert any claims under the Lanham Act, 15
U.S.C. §§ 1051, et seq. Nor does the Plaintiff or Defendant Galleries appear to
even hold registered federal trademarks. (ECF No. 24 at ¶¶ 17-21, 37.)
Three arguments are raised for dismissal: (1) that Plaintiff lacks
standing, and thus the Court lacks subject matter jurisdiction; (2) that the
Amended Complaint fails to state a claim for declaratory relief; and (3) that
abstention in deference to a parallel lawsuit in Florida court is appropriate and
warranted under the Colorado River doctrine. (ECF No. 26.)
2.
Legal Standard – Rule 12(b)(1)
“A defendant can move to dismiss a complaint under Rule 12(b)(1) for
lack of subject matter jurisdiction by either facial or factual attack.” Stalley ex
rel. U.S. v. Orlando Regional Healthcare System, Inc., 524 F.3d 1229, 1232
(11th Cir. 2008). “A facial attack on the complaint requires the court merely to
look and see if the plaintiff has sufficiently alleged a basis of subject matter
jurisdiction, and the allegations in his complaint are taken as true for the
purposes of the motion.” Id. (quotation omitted). “By contrast, a factual attack
on a complaint challenges the existence of subject matter jurisdiction using
material extrinsic from the pleadings, such as affidavits or testimony.” Id.
“When defending against a facial attack, the plaintiff has ‘safeguards
similar to those retained when a Rule 12(b)(6) motion to dismiss for failure to
state a claim is raised,’ and ‘the court must consider the allegations in the
plaintiff’s complaint as true.’ ” Id. (quotation omitted). The Court is required
“merely to look and see if the plaintiff has sufficiently alleged a basis of subject
matter jurisdiction, and the allegations in his complaint are taken as true for
the purposes of the motion.” Lawrence v. Dunbar, 919 F.2d 1525, 1529 (11th
Cir. 1990).
3.
Analysis
To begin, the Court dismisses the claim against Defendant Masters for
failure to timely serve. “If the plaintiff fails to properly serve the defendant
within [90] days, ‘the court, upon motion or on its own initiative after notice to
the plaintiff, shall dismiss the action without prejudice . . . .’” Lepone-Dempsey
v. Carroll Cnty. Comm’rs, 476 F.3d 1277, 1281 (11th Cir. 2007) (quoting Fed. R.
Civ. P. 4(m)). Rule 4(m) required the Plaintiff to serve Defendant Masters by
December 6, 2018. Service was not effected by that date, despite the Plaintiff
being on notice that failure do so is grounds for dismissal under Rule 4(m).
(See ECF No. 32 (seeking dismissal on this basis).) Accordingly, all claims
against Defendant Masters are dismissed without prejudice for failure to
timely serve.
The Court now considers its subject matter jurisdiction. Because the
Plaintiff only seeks declaratory relief, this inquiry begins with 28 U.S.C. § 2201.
The “Declaratory Judgment Act does not ‘extend’ the ‘jurisdiction’ of the federal
courts.” Medtronic, Inc. v. Mirowski Family Ventures, LLC, 571 U.S 191, 197
(2014). In determining declaratory judgment jurisdiction, federal courts “often
look to the ‘character of the threatened action’” that necessitates the requested
declaration. Id. (quoting Pub. Servs. Comm’n of Utah v. Wycoff Co., 344 U.S.
237, 248 (1952)). And in making such a determination, the operative question
is “whether ‘a coercive action’ brought by ‘the declaratory judgment defendant’ .
. . ‘would necessarily present a federal question.’” Id. (quoting Franchise Tax
Bd. Of Cal. V. Constr. Laborers Vacation Trust for S. Cal., 463 U.S. 1, 19 (1983));
Fastcase, Inc. v. Lawriter, LLC, 907 F.3d 1335, 1340 (11th Cir. 2018) (same);
see also Red Lobster Inns of Am., Inc. v. New England Oyster House, Inc., 378 F.
Supp. 1144, 1146 (S.D. Fla. 1974 (Fulton, C.J.) (“When a litigant relies on the
federal trade-mark laws to support an action for declaratory relief, as plaintiff
has tried to do in this case, an independent claim under the trademark laws
must exist.”) aff’d 524 F.2d 968 (5th Cir. 1975). 1 Thus, a “declaratory judgment
action, which avoids [a] threatened action” under the Lanham Act, “also ‘arises
under’” federal trademark law for the purposes of 28 U.S.C. § 1338(a).
Medtronic, Inc., 571 U.S. at 198 (holding the same with respect to federal
patent law).
Under that framework, the existence of federal jurisdiction in this case is
dependent on whether the Amended Complaint seeks a declaration which will
avoid a threatened action that Defendant Galleries may bring under federal
law. It follows, then, that the Plaintiff must show (1) that Defendant Galleries
possesses a cause of action under the Lanham Act, and (2) that the requested
declarations would avoid that threatened action.
Prosecution of trademark infringement under the Lanham Act is limited
to “registrants” of that trademark. See 15 U.S.C. § 1114(1) (limiting liability for
trademark infringement to “civil action[s] by the registrant”); see also Sream,
Inc. v. Grateful J’s, Inc., 2017 WL 6409004, *3-*4 (S.D. Fla. Oct. 13, 2017)
(Lenard, J.) (a cause of action of trademark infringement under the Lanham Act
“is available only to ‘the registrant’”); Sream, Inc. v. LB Smoke Shop, Inc., 2017
WL 2735575, *3-*4 (S.D. Fla. June 23, 2017) (Huck, J.) (“Absent legal title to a
registered trademark, a plaintiff lacks the legally protected interest necessary
to establish standing to bring a trademark claim under the Lanham Act.”). A
“registrant” under the Lanham Act “embrace[s] the legal representatives,
The Eleventh Circuit has adopted, as binding precedent, all decisions of
the former Fifth Circuit handed down prior to close of business on September
30, 1981. Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir. 1981) (en
banc).
1
predecessors, successors and assigns of such . . . registrant.” 15 U.S.C. §
1127.
The Amended Complaint, however, does not allege that Defendant
Galleries is a “registrant” of a federal trademark, or even a “predecessor,
successor,” assignee or licensee of one. Instead, the Plaintiff alleges that
Defendant Galleries was denied registration of the “KODNER” mark in 2015 by
the United States Patent and Trademark Office, and also abandoned and
cancelled the previously registered federal mark “Kodner Galleries.” (ECF No.
24 at ¶¶ 17-19.) These allegations make clear that Defendant Galleries is not
the registrant of a federal trademark and does not have standing to prosecute a
federal infringement claim under section 1114. As a result, the requested
declaration—that the Plaintiff is not infringing on Defendant Galleries’
trademark—would not “avoid [a] threatened action” under federal law.
Medtronic, Inc., 571 U.S. at 198; Red Lobster, 378 F. Supp. at 1146 aff’d 524
F.2d 968 (5th Cir. 1975); (see also P’s Mot. for Leave to File Surreply, ECF No.
29 at p. 2 (arguing that any contention that “this case is about Plaintiff Estate
enforcing a federal trademark against Defendant Galleries” is “simply false”)).
Thus, the Court lacks subject matter jurisdiction and must dismiss this case.
4. Conclusion
In sum, all claims against Defendant Gallery of the Masters, Inc. are
dismissed without prejudice for failure to timely serve. The Court further
dismisses this case without prejudice for lack of federal subject matter
jurisdiction. The Clerk is directed to close this case. All pending motions, if
any, are denied as moot.
2019.
Done and ordered, in Chambers, in Miami, Florida on January 14,
Robert N. Scola, Jr.
United States District Judge
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