Blue Gentian, LLC v. Tristar Products, Inc.

Filing 253

OPINION. Signed by Judge Noel L. Hillman on 4/11/2017. (dmr)

UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
_________________________________
BLUE GENTIAN, LLC, et al.,
Plaintiffs,

Civil No. 13-1758 (NLH/AMD)

v.
OPINION
TRISTAR PRODUCTS, INC., et al.,
Defendants.
__________________________________

APPEARANCES:
GRAHAM CURTIN, P.A.
By: George C. Jones, Esq.
4 Headquarters Plaza
P.O. BOX 1991
Morristown, New Jersey 07962
and
McHALE & SLAVIN, P.A.
By: Edward F. McHale, Esq.
Kenneth W. Cohen, Esq.
Andrew D. Lockton, Esq.
2855 PGA Boulevard
Palm Beach Gardens, Florida 33410
Counsel for Blue Gentian, LLC; National Express, Inc.; Michael
Berardi; Cheryl Berardi; DAP Products, Inc. and E. Mishan and
Sons, Inc.
BAKOS & KRITZER
By: Noam J. Kritzer, Esq.
Edward P. Bakos, Esq.
147 Columbia Turnpike
Florham Park, New Jersey 07932
Counsel for Tristar Products, Inc.; Wal-Mart Stores, Inc.; and
Ragner Technology Corporation
PRYOR CASHMAN
By: Jeffrey L. Snow, Esq.
7 Times Square
1

New York, New York 10036
Counsel for Telebrands Corporation

HILLMAN, District Judge
Presently pending in this District are seven cases 1 involving
various patents, all concerning expandable hose technology, which
are undisputedly “related” under the Court’s local rule. 2

For

reasons that are difficult to entirely reconstruct at this point,
not all of the cases were properly designated, or immediately

1

The cases, listed in the order in which they were filed, are: (1)
Blue Gentian, LLC and National Express, Inc. v. Tristar Prods.,
Inc. and Wal-Mart Store, Inc., 1:13-cv-1758-NLH-AMD (hereinafter
“Blue Gentian”); (2) Tristar Prods., Inc. and Ragner Tech. Corp.
v. Nat’l Express, Inc., DAP Prods., Inc. and E. Mishan and Sons,
Inc., 2:13-cv-7752-ES-MAH (hereinafter “Tristar”); (3) Ragner
Tech. Corp. and Tristar Prods., Inc. v. Michael Berardi (member of
Blue Gentian, LLC), Cheryl Berardi (member of Blue Gentian, LLC),
and Nat’l Express, Inc., 1:15-cv-7752-NLH-AMD (hereinafter “Ragner
I”); (4) Telebrands Corp. v. Ragner Tech. Corp. and Tristar
Prods., Inc., 2:15-cv-3163-ES-MAH (hereinafter “Telebarands I”);
(5) Ragner Tech. Corp. and Tristar Prods., Inc. v. Telebrands
Corp., 2:15-cv-8185-ES-MAH (hereinafter “Ragner II”); (6)
Telebrands Corp. v. Ragner Tech. Corp. and Tristar Prods., Inc.,
2:16-cv-3474-ES-MAH (hereinafter “Telebrands II”); and (7)
Telebrands Corp. v. Ragner Tech. Corp. and Tristar Prods., Inc.,
2:16-cv-3594-ES-SCM (hereinafter “Telebrands III”).
2

See L. Civ. R. 40.1(c)(“When a civil action: (1) relates to any
property included in a case already pending in this Court; (2)
grows out of the same transaction as any case already pending in
this Court; or (3) involves the validity or infringement of any
patent, copyright or trademark which is involved in a case already
pending in this Court, counsel shall at the time of filing the
action inform the Clerk of such fact. Whenever possible, such
action shall be assigned to the same Judge to whom the pending
related action is assigned.”).
2

recognized, as being related.

Now, more than four years after the

above-captioned case was filed, Defendants to this suit, Tristar
Products, Inc., and Wal-Mart Stores, Inc., move to consolidate this
case, and Ragner I, both pending before the undersigned here in
this District’s Camden Vicinage, with four other cases pending
before District Judge Salas in this District’s Newark Vicinage:
Tristar, Telebrands I, Ragner II, and Telebrands III. 3
The Court held oral argument on the motion on March 8, 2017.
For the reasons stated herein, the motion will be denied.
I.
A.
The Court recites portions of the interwoven procedural
histories of the seven related cases to the extent those histories
are relevant to, and provide context for, the instant Motion to
Consolidate.
The above-captioned case, Blue Gentian, which is the firstfiled of the seven cases, was filed on October 23, 2012 in the

Tristar’s papers request consolidation with only three of the
five cases pending before Judge Salas. However, during oral
argument, counsel for Tristar orally modified the motion to include
Telebrands III.
Similarly, Tristar’s proposed order states that Tristar seeks
“consolidat[ion] in this District under Civil Action No. 2:13-cv07752-ES-MAH [Telebrands] for discovery and pretrial purposes.”
(Docket 13-1758, Entry #237-13) At oral argument, counsel for
Tristar clarified that Tristar seeks consolidation of the cases
regardless of which case becomes the lead case-- i.e., regardless
of whether the cases are consolidated in Camden or Newark.

3

3

Southern District of Florida.

In March, 2013, upon Defendant

Tristar’s Motion, the case was transferred to this District.
Tristar, the second-filed case, was filed in this District on
December 20, 2013.

At the time Tristar was filed, it appears it

could have been designated as a related case to Blue Gentian (which
was, at the time, assigned to now-retired District Judge Hochberg).
However, the civil cover sheet for Tristar does not identify any
related cases.
After Tristar had successfully moved to transfer Blue Gentian
from the Southern District of Florida to this Court, in May, 2014,
Tristar and Ragner filed Ragner I in the Southern District of
Florida.

Presumably the choice to file in Florida, despite the two

pending New Jersey cases, was based on personal jurisdiction
concerns. 4

However, what seems to be more significant is the fact

that after the Florida District Judge sua sponte raised the issue
of the potentially related New Jersey litigation (See Docket 157752, Entry #47), Tristar took a position that appears to be in
conflict with the position it takes here.

In response to the

Florida District Judge’s order, Tristar identified both Blue
Gentian and Tristar, but argued those cases were not sufficiently
related to Ragner I:
The Court has raised a concern that the federal antitrust
4

Indeed, after Ragner I was transferred to New Jersey, the Berardi
Defendants moved to dismiss for lack of personal jurisdiction.
4

claim in the instant action overlaps with the issues
being adjudicated by the District of New Jersey in these
cases. Plaintiffs respectfully submit that while the
[Blue Gentian] action involves assertion of the patents
which give rise to the claims in the present action, the
District of New Jersey is solely concerned with the
validity, enforceability, and potential infringement of
those patents (i.e., the District of New Jersey will
need to determine whether the Berardi patents were
procured by inequitable conduct or fraud to determine if
these patents are valid and enforceable). The District
of New Jersey is not being asked to determine whether
the actions of Michael Berardi, Cheryl Berardi, Edward
Kelly,
and
National Express
were
tantamount
to
antitrust. While both Courts will look to overlapping
facts, the analysis before this Court falls under an
entirely different standard than the standard for
inequitable conduct (fraud on the United States Patent
and Trademark Office). That is, because the standards
are different, this Court can determine whether
Defendants’ actions constitute an antitrust violation
without fear of inconsistent rulings, even if the New
Jersey Court finds that Defendants’ patents are invalid
due to inequitable conduct. Further, the Court in its
Order recognizes that the present action also involves
claims resounding in fraud and breach of contract to be
adjudicated under the laws of the state of Florida, with
respect to actions that occurred wholly within the state
of Florida.
Plaintiffs respectfully submit that while the
[Tristar] matter involves Ragner Technology Corp.,
Tristar Products, Inc., and National Express, Inc., the
defendants Michael Berardi, Cheryl Berardi, and Edward
Kelly are not parties to the action. Furthermore, the
[Tristar] matter relates to the enforcement of patents
owned by Ragner Technology Corp. and licensed to Tristar
Products, Inc. The enforceability of the patents owned
by Blue Gentian, LLC are not currently expected to be an
issue in the [Tristar] matter, as the Ragner patents at
issue have a priority date that long precedes the facts
that give rise to Plaintiffs’ antitrust claim presented
in the present matter.
In response to the Court’s stated concern regarding
potentially inconsistent rulings with respect to the
federal claims presented in the presently Amended
Complaint, Plaintiffs respectfully submit that because
5

of the difference in scope and standard in the [Blue
Gentian] matter, the different intellectual property at
issue in the [Tristar] matter, and the intricacies of
applying laws of the state of Florida to the presented
facts, inconsistent rulings are highly unlikely.
(Docket 15-7752, Entry #49, p. 2-3)
Thereafter, on May 5, 2015 the ‘076 patent was issued. 5
same day, Telebrands I was filed in this District.

On the

Telebrands I

was designated as related to both Blue Gentian (at that point
assigned to the undersigned) and Tristar, and assigned to District
Judge Salas, in Newark, who was (and is) presiding over Tristar.
Then, Tristar and Ragner filed Ragner II in the District of
Delaware.

This time, like Ragner I, it appears that the initial

choice to file in a court other than the District of New Jersey may
have been driven by personal jurisdiction concerns.

However,

Ragner II was ultimately transferred to this District on the
defendants’ motion.

Notably, Tristar opposed transfer to New

Jersey (see Docket 15-8185, Entry #16), even though by that time-October, 2015-- Tristar was both a plaintiff and a defendant in
related actions pending in New Jersey (Blue Gentian, Tristar, and
Telebrands I), and the motion to transfer Ragner I to New Jersey
was pending in Florida. 6

5

Tristar asserts that the ‘076 patent is “pivotal” to the entire
“constellation” of cases.
6

The Motion to Transfer Ragner I was granted. Later, Magistrate
Judge Hammer granted consolidation of Tristar, Telebrands I, and
6

Lastly, Telebrands II and Telebrands III were both filed
originally in this District in 2016.

Upon the filing of each

complaint, Telebrands’ counsel indicated that the cases were
related to Telebrands I and Ragner II but omitted the two cases
pending before the undersigned, Blue Gentian and Ragner I. 7
B.
Blue Gentian-- claims and status
In Blue Gentian the Fifth Amended Complaint is the operative
complaint.

Plaintiffs assert direct and indirect infringement of

the ‘941, ‘942, ‘776, ‘213, ‘681, and ‘186 patents.

Defendants

counterclaim for declarations of non-infringement, invalidity, and
unenforceability as to all of the patents-in-suit.
Markman briefing has been completed, but the Court has not yet
held the Markman hearing.

Ragner II over Tristar’s objection that Tristar should not be
included in the consolidation.
7

The Court does not imply that Blue Gentian and Ragner I were
omitted in bad faith. To the contrary, the Court has no basis to
conclude that any counsel appearing in any of the seven cases
deliberately intended to mislead this Court, or any other Court, at
any time.
The Court recognizes that each of these cases are complex in
their own right, and that intervening events-- such as the issuance
of the ‘076 patent in May, 2015, the reexamination of that patent
at the USPTO, and subsequent appeal to the PTAB (which is still
pending), in addition to transfers between Courts and reassignments
within this District-- further complicate the situation. Indeed,
it is precisely such complexity that supports the Court’s
conclusion that consolidation is inappropriate.
7

Ragner I-- claims and status
The Ragner I suit is arguably the most different from the
other suits insofar as it does not assert any patent claims.
Rather, the parties sometimes refer to this case as “the antitrust
suit” because plaintiffs assert claims for monopolization and
attempted monopolization of the expandable hose market, as well as
common law claims for fraud and breach of contract.

However, those

legal claims are based on factual allegations that the Berardi
Defendants “fraudulently obtained patents from the United States
Patent and Trademark Office (“USPTO”), including but not limited to
. . . the ‘941 patent, . . . the ‘942 patent, . . .

and . . . the

‘776 patent.” (Second Amend. Compl. ¶ 47)
No Answer to the Second Amended Complaint has been filed.
Motions to Dismiss have been filed, but the motions have been
administratively terminated pending the disposition of the issue,
raised sua sponte by the Court, whether the entire case should be
stayed pending disposition of Blue Gentian.
Tristar-- claims and status
The Third Amended Complaint is the operative complaint in
Tristar. 8

It asserts claims for direct and indirect infringement of

8

Even the Third Amended Complaint, which was filed in April, 2016,
includes the following certification, “[Tristar and Ragner], by
their undersigned counsel, hereby certify pursuant to Local Civil
Rule 11.2 that the matters in controversy are not the subject of
any other action pending in any other court or of any other pending
8

the ‘448, ‘836, and ‘076 patents.

Defendants assert counterclaims

for false patent marking of all three patents-in-suit, as well as
claims for declarations of: (a) non-infringement and invalidity as
to all three patents-in suit; and (b) unenforceability of the ‘836
and ‘076 patents due to inequitable conduct before the USPTO.
Markman briefing has been completed, but the Court has not yet
held the Markman hearing.
Telebrands I-- claims and status
The First Amended Complaint seeks declarations of invalidity
and non-infringement as to the ‘076 and ‘448 patents, as well as a
declaration that the ‘076 patent is unenforceable.

Defendants

assert counterclaims for infringement of the ‘076 and ‘448 patents.
In August 2016, Judge Salas denied Telebrands’ Motion to
Dismiss the counterclaim for infringement of the ‘076 patent.
Ragner II-- claims and status
This suit asserts one claim for infringement of the ‘448
patent.

Defendants assert counterclaims for declarations of

invalidity and non-infringement of the ‘448 patent, as well as
claims for tortious interference with contracts and malicious use
of process.
Motions to dismiss were pending but were administratively

arbitration or administrative proceeding.” (Docket 13-7752, Entry
#122-2, p. 22 of 147)
9

terminated pending disposition of the instant motion.
Telebrands III-- claims and status
The Complaint seeks declarations that the ‘944 patent, alleged
to be a continuation of the ‘076 patent, is invalid, noninfringing, and unenforceable.

Defendants assert counterclaims for

infringement of the ‘944 patent.
Defendants have also moved to dismiss Count III (the
declaration of unenforceability count) of the Complaint but Judge
Salas has administratively terminated that motion pending the
disposition of the instant motion.
II.
Federal Rule of Civil Procedure 42(a)(2) provides in relevant
part, “[i]f actions before the court involve a common question of
law or fact, the court may . . . consolidate the actions.”
(emphasis added).
“‘[C]onsolidation is permitted as a matter of convenience and
economy in administration.’” In re Cmty. Bank of N. Virginia, 418
F.3d 277, 298 (3d Cir. 2005)(quoting Johnson v. Manhattan Ry. Co.,
289 U.S. 479, 496–97 (1933)).

“While the existence of common

issues is a prerequisite for consolidation, their mere presence
does not compel consolidation. . . . [W]hen exercising its
discretion on a consolidation motion, a court should weigh the
interests of judicial economy against the potential for new delays,

10

expense, confusion, or prejudice.” Margolis v. Hydroxatone, LLC,
2013 WL 875987, at *2 (D.N.J. Mar. 6, 2013)(internal citations and
quotations omitted).
III.
The question presented is whether the Court should consolidate
Blue Gentian and Ragner I with the consolidated cases in Tristar
(i.e., Tristar, Telebrands I, and Ragner II), as well as Telebrands
III.

The parties do not dispute that the cases share at least one

common issue of law or fact that would allow consolidation under
Rule 42(a)(2).

The existence of one or more common issues however,

does not end the Court’s analysis.

Given the complexity of each of

these cases, and the length of time that these cases have been
litigated independently of one another, the Court must carefully
consider whether consolidation this far into the respective
litigations-- particularly the independent litigations of Blue
Gentian and Tristar 9-- would further judicial economy.
holds that it would not.

The Court

Rather, the Court concludes that

consolidating at this time Blue Gentian and Ragner I with the other
actions would result in one massive and unwieldly consolidated suit
involving complex issues of patent and antitrust law, all at
various stages in their respective litigations.

9

To date, Blue Gentian’s docket has over 245 entries; Tristar’s
docket has over 145 entries.
11

Moreover, there is a logical line of demarcation between Blue
Gentian / Ragner I and the other cases.

While the cases all

involve, to one extent or another, patents covering expandable hose
technology, not all of the patents are directly at issue in every
case.

Rather, the pleadings indicate that at least the ‘941, ‘942,

and ‘776 patents are most directly implicated in both Blue Gentian
and Ragner I, whereas all four of the other actions very clearly
implicate the asserted infringement, invalidity, et cetera, of the
‘448 and ‘076 patents. 10
Further underscoring this logical demarcation line are the
parties’ Joint Claim Construction Prehearing Statements, see Local
Patent Rule 4.3, in Blue Gentian and Tristar.

The claims to be

construed in Blue Gentian are entirely different from the claims to
be construed in Tristar.

There is not a single overlapping term.

Lastly, insofar as Tristar argues that consolidation would
avoid the problem of litigating similar issues before two different
District Judges and two different Magistrate Judges, the Court
observes that the problem is, to some extent, one of Tristar’s own
(intentional or unintentional) making, as demonstrated by the

Thus the Court disagrees with Tristar and Ragner’s assertion
that the reasoning of Judge Hammer’s consolidation opinion in the
Tristar action supports further consolidation of Blue Gentian and
Ragner I. Simply put, there is less overlap and more differences
between Blue Gentian and Ragner I on one hand, and the four other
actions on the other, than there is among the individual suits
within the consolidated Tristar action.
10

12

extensive discussion of each case’s procedural history above.
IV.
For the reasons stated above, Defendants’ Motion to
Consolidate will be denied.

An appropriate order accompanies this

opinion.

Dated: April 11, 2017
At Camden, New Jersey

__s/ Noel L. Hillman____
NOEL L. HILLMAN, U.S.D.J.

13