Innovation Ventures LLC et al v. Pittsburg Wholesale Grocers Inc et al
ORDER granting 543 Motion to Consolidate Cases; granting 548 Motion for Joinder. For the reasons stated in the attached Memorandum and Order, the court orders the consolidation of the cases, Innovation Ventures, et al. v. Ultimate One Distributing Corp., et al. (Docket No. 12-cv-5354), and Innovation Ventures, et al., v. Pittsburg Wholesale Grocers Inc., et al. (Docket No. 13-cv-6397), pursuant to Rule 42(a). Ordered by Judge Kiyo A. Matsumoto on 3/3/2014. (Tsai, Denise)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
INNOVATION VENTURES, et al.,
MEMORANDUM & ORDER
-againstULTIMATE ONE DISTRIBUTING
CORP., et al.,
INNOVATION VENTURES, et al.,
-againstPITTSBURG WHOLESALE GROCERS INC., et al.,
MATSUMOTO, United States District Judge:
Pending before the court is a joint request that the
court sua sponte consolidate the above-captioned actions,
Innovation Ventures, et al. v. Pittsburg Wholesale Grocers Inc.,
et al., No. 13-cv-6397, and Innovation Ventures, et al. v.
Ultimate One Distributing Corp., et al., No. 12-cv-5354.
January 13, 2014, plaintiffs Innovation Ventures, LLC, Living
Essentials, LLC, and International IP Holdings, LLC
(collectively, “Living Essentials” or “plaintiffs”), filed their
request that the court sua sponte consolidate these two matters
for all purposes pursuant to Federal Rule of Civil Procedure 42.
(Docket 12-cv-5354, ECF No. 654, Ltr. Requesting Consolidation
filed 1/13/14; Docket 13-cv-6397, ECF No. 543 (same).)
February 14, 2014, defendants Dan-Dee Company, Inc., Kevin
Attiq, and Fadi Attiq (collectively, the “Dan-Dee defendants”),
joined in plaintiffs’ request that the court sua sponte
consolidate the two cases.
(Docket 12-cv-5354, ECF No. 673,
Ltr. from Dan-Dee Defs. filed 2/14/14; Docket 13-cv-6397, ECF
No. 548 (same).)
On February 19, 2014, the court ordered all
parties in both matters to file any opposition to the joint
request for sua sponte consolidation by February 24, 2014.
Order dated 2/19/14.)
To date, no parties have objected to the
joint request for consolidation.
For the following reasons, the court sua sponte
consolidates the actions captioned Innovation Ventures, et al.
v. Ultimate One Distributing Corp., et al. (Docket 12-cv-5354)
and Innovation Ventures, et al. v. Pittsburg Wholesale Grocers,
Inc., et al. (Docket 13-cv-6397), pursuant to Federal Rule of
Civil Procedure 42.
Procedural History and Factual Background
On October 25, 2012, Living Essentials commenced this
action, captioned Innovation Ventures, et al. v. Ultimate One
Distributing Corp., et al. (“Ultimate Action”) 1, in this court.
In its initial complaint, plaintiffs, the owner of 5-hour
ENERGY, alleged that more than twenty defendants had sold
counterfeit 5-hour ENERGY in violation of the Lanham Act, 15
U.S.C. §§ 1114 and 1125, the Copyright Act of 1976, 17 U.S.C. §
106, New York state law and common law.
(See U.A. No. 1, Compl.
On October 26, 2012, plaintiffs filed the action
captioned Innovation Ventures, et al. v. Pittsburg Wholesale
Grocers Inc., et al. (“Pittsburg Action”) 2, in the Northern
District of California.
In its initial complaint in the
Pittsburg Action, plaintiffs alleged substantially the same
claims as in the Ultimate Action against sixteen defendants
based in California.
(See P.A. No. 1, Compl. filed 10/26/12.)
As plaintiffs traced the counterfeits up the chain of
distribution, the Ultimate Action grew to include sixty-nine
(See U.A. No. 291, Seventh Am. Compl. filed
In their Seventh Amended Complaint, plaintiffs
alleged that Dan-Dee Company, Inc. (“Dan-Dee”), a defendant in
the related Pittsburg Action, was the principal nationwide
“distribution hub” for counterfeit 5-hour ENERGY. (Seventh Am.
Compl. at 5.)
A number of defendants in the Ultimate Action
Ultimate Action docket, No. 12-cv-5354, is hereinafter referred
Pittsburg Action docket, No. 13-cv-6397, is hereinafter referred
then impleaded Dan-Dee and its principals (“Dan-Dee Defendants”)
as third-party defendants in the Ultimate Action. (See U.A. Nos.
390, 473, 535, 580.)
In turn, Dan-Dee Defendants impleaded a
number of defendants from the Ultimate Action as third-party
defendants in the Pittsburg Action. 3
(See P.A. No. 162, Am.
Third-Party Compl. filed 1/23/12.)
In April 2013, Capital Sales Company, a defendant in
the Ultimate Action and a customer of Dan-Dee, filed suit
against the Dan-Dee Defendants in the Eastern District of
The Eastern District of Michigan transferred venue to
this court, and this court consolidated Capital Sales Company’s
suit with the Ultimate Action.
(Docket 13-cv-3542, No. 28,
Order to Consolidate Cases dated 7/31/12.)
On November 12, 2013, plaintiffs moved to transfer
venue in the Pittsburg Action from the Northern District of
California to this district, on the grounds that all remaining
parties in the Pittsburg Action are also parties to the larger,
first-filed Ultimate Action, and the issues remaining to be
Specifically, Dan-Dee Defendants impleaded as third-party defendants the socalled “Midwest Defendants” (Midwest Wholesale Distributors, Inc., Walid
Jamil, and Justin Shayota), “Leslie Roman Defendants,” “MCR Defendants”
(Mario Ramirez, Camilo Ramirez, MCR Innovations and Packaging, Inc., MCR
Printing & Packaging Corp., and Naftaunited.com), “Juan Romero Defendants,”
and “Baja Defendants” (Baja Exporting, LLC, Tradeway International, Inc.
d/b/a Baja Exporting, Joseph Shayota, and Adrianna Shayota). The Clerk of
Court of the Northern District of California entered default against the Juan
Romero Defendants on May 1, 2013. (P.A. No. 326, Entry of Default dated
5/1/13.) The Leslie Roman Defendants declared bankruptcy in July 2013.
(P.A. No. 430, Notice of Bankruptcy Filing dated 7/24/13.) The Juan Romero
Defendants and the Leslie Roman Defendants neither joined nor opposed
plaintiffs’ motion to transfer venue.
tried are a subset of the issues in the Ultimate Action.
No. 508, Mot. for Change of Venue filed 11/12/13, at 1.)
party opposed the motion, and all parties signed a stipulation
requesting that the Pittsburg Action “be transferred to the
Eastern District of New York for consolidation with” the
(P.A. No. 509, Stip. filed 11/12/13, at 2.)
On November 15, 2013, the Northern District of
California transferred the Pittsburg Action to this district.
(P.A. No. 530, Order Granting Mot. to Change Venue dated
Plaintiffs have settled with all direct defendants in
the Pittsburg Action, except for the Dan-Dee Defendants.
remaining claims in the Pittsburg Action are: (1) Plaintiffs’
direct claims against Dan-Dee Defendants, who remain third-party
defendants in the Ultimate Action; (2) Dan-Dee Defendants’
third-party claims against the Midwest Defendants, Leslie Roman
Defendants, MCR Defendants, Juan Romero Defendants, and Baja
Defendants, all of whom are direct defendants in the Ultimate
Action; and (3) certain cross-claims among the third-party
Motion to Consolidate
Pursuant to Federal Rule of Civil Procedure 42(a), a
court can consolidate pending matters where such actions
"involve a common question of law or fact."
42(a) (“Rule 42(a)”).
Fed. R. Civ. P.
A court may consolidate related cases sua
sponte under Rule 42(a).
Devlin v. Transp. Comm’ns Intern.
Union, 175 F.3d 121, 130 (2d Cir. 1999).
Rule 42 “should be
prudently employed as a valuable and important tool of judicial
administration, invoked to expedite trial and eliminate
unnecessary repetition and confusion.”
and quotation marks omitted).
Id. (internal citations
Even when actions involve a
common question of law or fact, however, the trial court has
broad discretion to determine whether consolidation is
appropriate by balancing the economy gained, an interest in
avoiding conflicting results, and prejudice to the parties.
Johnson v. Celotex Corp., 899 F.2d 1281, 1284-85 (2d Cir. 1990)
(the court must consider “‘[w]hether the specific risks of
prejudice and possible confusion [are] overborne by the risk of
inconsistent adjudications of common factual and legal issues,
the burden on parties, witnesses, and available judicial
resources posed by multiple lawsuits, the length of time
required to conclude multiple suits as against a single one, and
the relative expense to all concerned of the single-trial,
multiple-trial alternatives.’”) (quoting Hendrix v. RaybestosManhattan, Inc., 776 F.2d 1492, 1495 (11th Cir. 1985)); Maggio
v. Leeward Ventures, 939 F. Supp. 1020, 1031 (E.D.N.Y. 1996);
Bank of Montreal v. Eagle Assoc., 117 F.R.D. 530, 533 (S.D.N.Y.
1987) (“One of the primary objectives of consolidation is to
prevent separate actions from producing conflicting results.”).
“Cases may be consolidated even where certain defendants are
named in only one of the complaints.”
Jacobs v. Castillo, 612
F. Supp. 2d 369, 373 (S.D.N.Y. 2009).
For the following reasons, the court finds that
consolidation of the present case with the Pittsburg Action is
necessary to promote judicial economy and to avoid conflicting
Accordingly, the court exercises its discretion and
grants the joint request by plaintiffs and Dan-Dee Defendants to
consolidate the actions.
A. Claims and Parties in this Action and Pittsburg
Here, all parties remaining in the Pittsburg Action
are also parties in the larger Ultimate Action.
the two cases concern the same plaintiffs, Living Essentials,
and all the remaining defendants in the Pittsburg Action are
also defendants, either direct or third-party, in the Ultimate
Moreover, both cases involve the same product and the
same factual and legal issues: “who manufactured and sold
counterfeit 5-hour ENERGY; whose actions were willful and whose
were not; and how much damage each defendant’s actions caused to
[plaintiffs] and to [other] co-defendants.”
Consolidation at 3.)
Because common questions of law and fact
exist in both actions, consolidation would be beneficial to
avoid inconsistent outcomes.
B. Convenience and Judicial Economy
The court further notes that judicial economy would be
served by consolidating the Ultimate Action and the Pittsburg
There are no significant legal and factual distinctions
between the two actions that would easily lead to confusion of
In addition, discovery in both cases has proceeded
along roughly parallel tracks, as document discovery in the
Pittsburg Action closed on November 1, 2013, and document
discovery in the Ultimate Action closed on January 17, 2014.
(See P.A. No. 555, Pls.’ Response in Opposition to Mot. to
Compel dated 2/25/14, at 2.)
Finally, the court can identify no
prejudice that would result from consolidation of the two
actions, and indeed, no parties have objected to the plaintiffs’
and Dan-Dee Defendants’ joint request for consolidation.
Endress v. Gentiva Health Services, Inc., 278 F.R.D. 78, 82
(E.D.N.Y. 2011) (finding “no prejudice inuring to the Defendants
as a result of consolidation” and noting that “[t]his is further
bolstered by the fact that there have been no objections to the
Plaintiffs’ requests for consolidation . . . in any of the
Accordingly, the court finds that the purposes of
judicial economy and convenience would be well-served by
consolidation of the two cases.
For the foregoing reasons, the court orders the
consolidation of the cases, Innovation Ventures, et al. v.
Ultimate One Distributing Corp., et al. (Docket No. 12-cv-5354),
and Innovation Ventures, et al., v. Pittsburg Wholesale Grocers
Inc., et al. (Docket No. 13-cv-6397), pursuant to Rule 42(a).
Dated: Brooklyn, New York
March 3, 2014
KIYO A. MATSUMOTO
United States District Judge
Eastern District of New York
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