Emory Group LLC v. ID Solutions, LLC
Filing
10
OPINION AND ORDER granting 4 Motion to Dismiss for Failure to State a Claim. Signed by Judge Thomas W. Thrash, Jr on 4/10/14. (dr)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
EMORY GROUP LLC,
Plaintiff,
v.
CIVIL ACTION FILE
NO. 1:14-CV-13-TWT
ID SOLUTIONS, LLC,
Defendant.
OPINION AND ORDER
The Plaintiff Emory Group LLC brings this trademark action against the
Defendant ID Solutions, LLC. The Plaintiff alleges that the Defendant has offered to
sell, and sold, clothing with a design similar to that marketed and sold by the Plaintiff.
It is before the Court on the Defendant’s Motion to Dismiss [Doc. 4]. For the reasons
set forth below, the Defendant’s Motion to Dismiss [Doc. 4] is GRANTED.
I. Background
The Plaintiff is a clothing company based in South Carolina. (Compl. ¶¶ 2, 7.)
It sells merchandise under several brand names, including “GENEOLOGIE.” (Compl.
¶ 7.) One particular clothing design bearing the mark GENEOLOGIE1 “features
1
The Plaintiff has a pending trademark application for the mark
“GENEOLOGIE.” (Compl. ¶ 11.)
T:\ORDERS\14\Emory Group LLC\mtdtwt.wpd
college and university Greek-letter fraternity letters, emblems and logos that potential
customers may customize to their preferences before purchasing said apparel.”
(Compl. ¶ 19.)
The Defendant is a clothing company based in Oklahoma. (Compl. ¶¶ 3, 30.)
It also sells “clothing apparel featuring college and university Greek-letter fraternity
letters, emblems and logos that potential customers may customize to their preferences
before purchasing said apparel.” (Compl. ¶ 36.) The Plaintiff asserts that a t-shirt
made by the Defendant for an Oklahoma University sorority event – although not
bearing the GENEOLOGIE mark – is confusingly similar to GENEOLOGIE
Greek-letter apparel. (Compl. ¶¶ 37-38.) The Defendant moves to dismiss, arguing
that the Court lacks personal jurisdiction over the Defendant, and in the alternative
that the Plaintiff has failed to state a claim.
II. Legal Standard
“In the context of a motion to dismiss for lack of personal jurisdiction in which
no evidentiary hearing is held, the plaintiff bears the burden of establishing a prima
facie case of jurisdiction over the movant, nonresident defendant.” Morris v. SSE,
Inc., 843 F.2d 489, 492 (11th Cir. 1988). The plaintiff establishes a prima facie case
by presenting “enough evidence to withstand a motion for directed verdict.” Madara
v. Hall, 916 F.2d 1510, 1514 (11th Cir. 1990). A party presents enough evidence to
T:\ORDERS\14\Emory Group LLC\mtdtwt.wpd
-2-
withstand a motion for directed verdict by putting forth “substantial evidence . . . of
such quality and weight that reasonable and fair-minded persons in the exercise of
impartial judgment might reach different conclusions . . ..” Walker v. NationsBank of
Florida, 53 F.3d 1548, 1554 (11th Cir. 1995). The facts presented in the plaintiff’s
complaint are taken as true to the extent they are uncontroverted. Foxworthy v.
Custom Tees, Inc., 879 F. Supp. 1200, 1207 n.10 (N.D. Ga. 1995). If, however, the
defendant submits affidavits challenging the allegations in the complaint, the burden
shifts back to the plaintiff to produce evidence supporting jurisdiction. See Diamond
Crystal Brands, Inc. v. Food Movers Intern., Inc., 593 F.3d 1249, 1257 (11th Cir.
2010); Meier v. Sun Int’l Hotels, Ltd., 288 F.3d 1264, 1269 (11th Cir. 2002). If the
plaintiff’s complaint and supporting evidence conflict with the defendant’s affidavits,
the court must construe all reasonable inferences in favor of the plaintiff. Madara, 916
F.2d at 1514. “As a general rule, courts should address issues relating to personal
jurisdiction before reaching the merits of a plaintiff’s claims.” Republic of Panama v.
BCCI Holdings (Luxembourg) S.A., 119 F.3d 935, 940 (11th Cir. 1997).
III. Discussion
Two requirements must be met for the Court to have personal jurisdiction over
the Defendant. First, there must be jurisdiction under Georgia’s long-arm statute. See
Madara, 916 F.2d at 1514 (“First, we consider the jurisdictional question under the
T:\ORDERS\14\Emory Group LLC\mtdtwt.wpd
-3-
state long-arm statute.”). Second, the exercise of jurisdiction must be consistent with
the Due Process Clause of the Fourteenth Amendment. See id. (“[W]e next determine
whether sufficient minimum contacts exist to satisfy the Due Process Clause of the
Fourteenth Amendment so that maintenance of the suit does not offend ‘traditional
notions of fair play and substantial justice.’”).
Here, the Court does not have personal jurisdiction over the Defendant under
Georgia’s long-arm statute.2 This statute reads, in relevant part:
A court . . . may exercise personal jurisdiction over any nonresident . . . as to
a cause of action arising from any of the acts . . . enumerated in this Code
section, in the same manner as if he or she were a resident of this state, if in
person or through an agent, he or she: (1) Transacts any business within this
state; (2) Commits a tortious act or omission within this state . . .; (3) Commits
a tortious injury in this state caused by an act or omission outside this state if
the tort-feasor regularly does or solicits business, or engages in any other
persistent course of conduct, or derives substantial revenue from goods used or
consumed or services rendered in this state.
O.C.G.A. § 9-10-91. The Plaintiff argues that there may be jurisdiction under
subsections (1) and (2). Each will be discussed.
2
The Georgia long-arm statute does not confer personal jurisdiction to the full
extent permitted by the Due Process Clause of the Fourteenth Amendment. See
Diamond Crystal Brands, 593 F.3d at 1259 (“[T]he Georgia long-arm statute does not
grant courts in Georgia personal jurisdiction that is coextensive with procedural due
process. . . .[i]t imposes independent obligations that a plaintiff must establish for the
exercise of personal jurisdiction that are distinct from the demands of procedural due
process.”).
T:\ORDERS\14\Emory Group LLC\mtdtwt.wpd
-4-
First, subsection (1) is read literally, circumscribed only by the Due Process
Clause. See Innovative Clinical & Consulting Servs., LLC v. First Nat. Bank of Ames,
279 Ga. 672, 675 (2005). “[U]nless and until the Georgia courts provide further
authoritative guidance, courts in this circuit construing the statute literally will have
to delineate the precise contours of the ‘[t]ransacts any business within this state’
requirement of O.C.G.A. § 9-10-91(1) according to the facts of each case.” Diamond
Crystal Brands, 593 F.3d at 1263. The Court must “examine all of a nonresident’s
tangible and intangible conduct and ask whether it can fairly be said that the
nonresident has transacted any business within Georgia.” Id. at 1264. Subsection (1)
applies to business transactions “conducted through . . . Internet contacts.” ATCO
Sign & Lighting Co., LLC v. Stamm Mfg., Inc., 298 Ga. App. 528, 534 (2009); see
also Innovative Clinical, 279 Ga. at 675 (“[N]othing in subsection (1) requires the
physical presence of the nonresident in Georgia or minimizes the import of a
nonresident’s intangible contacts with the State.”). The defendant must have
“purposefully done some act or consummated some transaction in this state.” Aero
Toy Store, LLC v. Grieves, 279 Ga. App. 515, 517 (2006).
T:\ORDERS\14\Emory Group LLC\mtdtwt.wpd
-5-
The Defendant is organized under the laws of Oklahoma. (Njoo Aff. ¶ 3.)3 Its
principal place of business is in Oklahoma. It does not have an office in Georgia.
(Njoo Aff. ¶ 7.) It has no employees in Georgia. (Njoo Aff. ¶ 7.) It does not own or
use any real property in Georgia. (Njoo Aff. ¶ 6.) It has engaged in two transactions
with Georgia customers, but these transactions did not include the allegedly infringing
clothing apparel. (Njoo Aff. ¶ 11.)
Here, the Plaintiff argues that there is jurisdiction under subsection (1) because
the Defendant admits that it has had two customers in Georgia. (Pl.’s Resp. to Def.’s
Mot. to Dismiss, at 6-7.) But it is not enough to show that the Defendant transacted
business in Georgia. The Plaintiff must also show that its cause of action arises out of
those transactions. See ATCO Sign & Lighting Co., 298 Ga. App. at 529
(“Jurisdiction exists if . . . the cause of action arises from or is connected with the act
or transaction.”). The Plaintiff does not dispute that these two Georgia customers did
not purchase the allegedly infringing clothing.4 The Plaintiff further tries to establish
jurisdiction under subsection (1) by pointing out that Georgia customers may access
the Defendant’s website. (Pl.’s Resp. to Def.’s Mot. to Dismiss, at 7-8.) But
3
Andrew Njoo is the President of the Defendant ID Solutions, LLC. (Njoo Aff.
¶ 2.)
4
To be clear, the Defendant manufactured the allegedly infringing clothing
apparel for a sorority formal at the University of Oklahoma. (Njoo Aff. ¶ 12.)
T:\ORDERS\14\Emory Group LLC\mtdtwt.wpd
-6-
“subsection (1) long-arm jurisdiction in Georgia expressly depends on the actual
transaction of business . . . by the defendant in the state.” Diamond Crystal Brands,
593 F.3d at 1260 (emphasis added). Even if the Defendant’s website may facilitate a
future transaction in Georgia relating to the allegedly infringing attire, the Plaintiff
does not show – or even allege – that such a transaction has taken place thus far.
Accordingly, the Court does not have jurisdiction over the Defendant under subsection
(1).
Second, for jurisdiction to exist under subsection (2), the tortious conduct itself
must have occurred in Georgia. See Anderson v. Deas, 279 Ga. App. 892, 893 (2006)
(Disapproving of cases which “held that a tortious act may be said to have been
committed in this state within the meaning of paragraph (2) based either on occurrence
of the tortious conduct or commission of the injury in this state.”). “In trademark
actions, the tort is said to occur where the defendant sells or attempts to sell the
offending product.” Shieffelin & Co. v. Jack Co. Of Boca, Inc., 725 F. Supp. 1314,
1319 (S.D.N.Y. 1989); see also Vanity Fair Mills, Inc. v. T. Eaton Co., 234 F.2d 633,
639 (2d Cir. 1956) (“[I]n cases of trade-mark infringement and unfair competition, the
wrong takes place . . . where the passing off occurs, i.e., where the deceived customer
buys the defendant's product in the belief that he is buying the plaintiff's.”); Swift v.
Medicate Pharmacy, Inc., No. 10 C 689, 2010 WL 3548006, at *4 (N.D. Ill. Sept. 3,
T:\ORDERS\14\Emory Group LLC\mtdtwt.wpd
-7-
2010) (“[I]n trademark infringement and unfair competition claims, the ‘wrong’ is
considered to have occurred where the ‘passing off’ occurs. . . .the situs is where the
infringing product is sold, even if the defendant is located elsewhere.”). When the
tortious conduct occurs over an Internet website, “the situs of this tort is considered
to be where the website, or servers which maintain the website, are located.” Gucci
Am., Inc. v. Frontline Processing Corp., 721 F. Supp. 2d 228, 241 (S.D.N.Y. 2010);
see also Swift, 2010 WL 3548006, at *4 (“In infringement litigation involving Internet
websites courts have tended to emphasize the location where the website is
maintained.”); Jordan Outdoor Enterprises, Ltd. v. That 70's Store, LLC, 819 F. Supp.
2d 1338, 1345 (M.D. Ga. 2011) (“Even if infringement occurred in Georgia as a result
of Georgia residents viewing the infringing marks on Defendants’ websites . . . the
conduct giving rise to the infringement occurred in Arkansas, where Defendants
created the websites.”).
Here, there is no allegation that the Defendant – an Oklahoma company – hosts
its website in Georgia. In response, the Plaintiff cites Licciardello v. Lovelady, 544
F.3d 1280 (11th Cir. 2008) for the proposition that the infringing act occurs wherever
the website is accessible. That case, however, dealt with the Florida long-arm statute,
see id. at 1283-84, and is thus inapplicable here, see Lockard v. Equifax, Inc., 163
F.3d 1259, 1265 (11th Cir. 1998) (“When a federal court uses a state long-arm statute,
T:\ORDERS\14\Emory Group LLC\mtdtwt.wpd
-8-
because the extent of the statute is governed by state law, the federal court is required
to construe it as would the state’s supreme court.”).5 In the Internet context, Georgia
courts have made clear that the culpable conduct occurs wherever the defendant
initiates the transmission of information. See Huggins v. Boyd, 304 Ga. App. 563, 565
(2010) (“The conduct giving rise to the offense . . . occurred at the physical place
where Huggins typed in and sent his e-mails. The effect was the transmission of the
communications along electronic lines and receipt by Boyd . . . at the other end.
Therefore, Huggins did not engage in any conduct . . . in Georgia, when he sent the
e-mails from out of state.”); LABMD, Inc. v. Tiversa, Inc., 509 Fed. Appx. 842,
844-45 (11th Cir. 2013) (“The conduct giving rise to Defendants’ alleged offense
occurred where Johnson and Tiversa used computers . . . [b]ecause [they] used
computers outside of Georgia, Defendants are not subject to personal jurisdiction
under subsection (2).”). Accordingly, the Court does not have jurisdiction over the
Defendant under subsection (2).
5
The Court notes that – unlike the Georgia long-arm statute – the Florida longarm statute confers jurisdiction even if the tortious act occurred outside of Florida so
long as the injury occurred in Florida. See Louis Vuitton Malletier, S.A. v. Mosseri,
736 F.3d 1339, 1353 (11th Cir. 2013) (“[U]nder Florida law, a nonresident defendant
commits ‘a tortious act within [Florida]’ when he commits an act outside the state that
causes injury within Florida.”).
T:\ORDERS\14\Emory Group LLC\mtdtwt.wpd
-9-
The Plaintiff argues that the Court ought to permit limited jurisdictional
discovery. “A plaintiff has a qualified right to conduct jurisdictional discovery when
jurisdictional facts are in dispute.” Cold Smoke Capital, LLC v. Gross, No.
1:11-CV-3558-WSD, 2012 WL 3612626, at *8 (N.D. Ga. Aug. 21, 2012) (citing
Eaton v. Dorchester Dev., Inc., 692 F.2d 727, 729-30 & n.7 (11th Cir.1982)). Here,
the facts relevant to the jurisdictional inquiry are not really in dispute.6 The Plaintiff’s
only argument in favor of allowing limited discovery is that it may reveal that Georgia
residents can access the Defendant’s website and potentially purchase items from the
Defendant. (Pl.’s Resp. to Def.’s Mot. to Dismiss, at 10.) However, as explained
above, this alone would not give the Court personal jurisdiction over the Defendant.
Thus, the Court denies the Plaintiff’s request for limited jurisdictional discovery. See
Cold Smoke Capital, 2012 WL 3612626, at *8 (“[A] district court may properly refuse
or limit jurisdictional discovery if the plaintiff has not made a sufficient showing that
there may be a basis for exercise of jurisdiction, or if the proposed discovery seems
unlikely to shed light on the jurisdictional question.”) (quoting Charles Alan Wright
et al., Federal Practice and Procedure § 2008.3, at 184 (2010)). Because the Court
6
The Plaintiff did not even allege in its Complaint that anyone in Georgia has
purchased the allegedly infringing clothing apparel from the Defendant.
T:\ORDERS\14\Emory Group LLC\mtdtwt.wpd
-10-
lacks personal jurisdiction over the Defendant, it need not address whether the
Plaintiff has stated a claim for relief.
IV. Conclusion
For these reasons, the Court GRANTS the Defendant’s Motion to Dismiss
[Doc. 4].
SO ORDERED, this 10 day of April, 2014.
/s/Thomas W. Thrash
THOMAS W. THRASH, JR.
United States District Judge
T:\ORDERS\14\Emory Group LLC\mtdtwt.wpd
-11-
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?