Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

ORAL-B LABS., INC. v. MI-LOR CORP.

June 19, 1985

ORAL-B LABORATORIES, INC., Plaintiff,
v.
MI-LOR CORPORATION, Defendant



The opinion of the court was delivered by: SWEET

SWEET, D.J.

Defendant Mi-Lor Corporation ("Mi-Lor") has moved to dismiss the trademark infringement action brought by Oral-B Laboratories ("Oral-B") on the grounds that venue is improper. In the alternative, Mi-Lor moves, pursuant to 28 U.S.C. § 1404(a) to transfer the action to the District of Massachusetts. Mi-Lor has also moved to clarify the preliminary injunction entered by this court on April 12, 1985. The motions to dismiss and to transfer are denied, and the motion for clarification is granted as set forth below.

Prior Proceedings

 On march 31, 1985 Oral-B filed a complaint against Mi-Lor, alleging trademark infringement, 15 U.S.C. § 1114(i), false designation, 15 U.S.C. § 1125(a), unfair competition 15 U.S.C. §§ 1125(a) and 1126(h) and (i), and New York State trademark dilution, New York General Business Law 368-D. Pursuant to a motion for a preliminary injunction, an evidentiary hearing was held on April 10, 1985. At the hearing, Mi-Lor reserved its right to challenge this court's jurisdiction. In connection with the issuance of a preliminary injunction on April 12 (Exhibit A), it was concluded that jurisdiction was properly exercised pursuant to N.Y.CPLR § 302(a)(2), that Oral-B had established secondary meaning in its trade dress, and that Mi-Lor's product infringed Oral-B's product.

 Discussion

 1. Jurisdiction

 After the hearing on the preliminary injunction I concluded that the offering of infringing goods within the state constitutes a tortious act pursuant to N.Y.CPLR § 302(a)(2). German Educ. Tel. v. Or. Public Broadcasting, 569 F. Supp. 1529 (S.D.N.Y. 1983); Vanity Fair Mills, Inc. v. T. Eaton Co., 234 F.2d 633, 639 (2d Cir. 1956), cert. denied, 352 U.S. 871, 1 L. Ed. 2d 76, 77 S. Ct. 96 (1956) ("the wrong takes place not where the deceptive labels are affixed to the goods or where the goods are wrapped in the misleading packages, but where the passing off occurs . . . .").

 Jurisdiction over Mi-Lor is also properly exercised under N.Y.CPLR § 301, the traditional "doing business" jurisdictional base. In order to hold that jurisdiction may be exercised because a foreign corporation is "doing business," it is necessary to conclude that the corporation is "'engaged in such a continuous and systematic course of 'doing business' here as to warrant a finding of its 'presence' in this jurisdiction.'" McGowan v. Smith, 52 N.Y.2d 268, 437 N.Y.S.2d 643, 645, 419 N.E.2d 321 (1981), quoting Simonson v. International Bank, 14 N.Y.2d 281, 251 N.Y.S.2d 433, 436, 200 N.E.2d 427 (1964). The test is whether "the aggregate of the corporation's activities in the State [is] such that it may be said to be 'present' in the state 'not occasionally or casually, but with a fair measure of permanence and continuity.'" Laufer v. Ostrow, 55 N.Y.2d 305, 449 N.Y.S.2d 456, 458, 434 N.E.2d 692 (Ct.App. 1982) (citations omitted).

 The facts elicited at the hearing on April 10, establish that Mi-Lor's presence in New York is sufficiently continuous and substantial to warrant the exercise of jurisdiction pursuant to CPLR § 301. Stuart Gottsegen a principal shareholder of Mi-Lor, Mi-Lor's National Sales Manager, and listed as Mi-Lor's Vice-President on a Dun and Bradstreet Financial Report, maintains a permanent office in New York. Gottsegen maintains that he is merely an independent consultant and salesman who receives a fixed fee from Mi-Lor. In his deposition, however, Gottsegen testified that he was an employee of Mi-Lor. Gottsegen may properly be viewed as an employee whose actions subject Mi-Lor to jurisdiction. Further, Irwin Casper, Marketing Manager for Mi-Lor, estimates that in 1984 Mi-Lor had sales of $300,000 in the Southern District of New York. This presence is sufficient to warrant the exercise of jurisdiction pursuant to § 301. See Benware v. Acme Chem. Co., 284 A.D. 760, 135 N.Y.S.2d 207 (App.Div.3d Dept. 1954).

 2. Venue

 Having determined that personal jurisdiction over Mi-Lor exists, I must separately consider whether venue is proper. Venue in this action is governed by 28 U.S.C. § 1391(c) which states that a "corporation may be sued in any judicial district in which it is . . . doing business . . . ." The precise quantum of activity needed to satisfy the "doing business" requirement of § 1391(c) is unclear. See Johnson Creative Arts v. Wool Masters, 743 F.2d 947 (1st Cir. 1984). Although some courts have held that satisfaction of a state's long-arm statute necessarily satisfies the doing business requirement, see Cable News Network, Inc., v. AM Broadcasting, Etc., 528 F. Supp. 365 (N.D.Ga. 1981), Courts in New York have held that venue is proper only when the contacts are sufficient to satisfy CPLR § 301, not CPLR § 302. See Sterling Television Presentations v. Shintron Co., 454 F. Supp. 183 (S.D.N.Y. 1978). Since personal jurisdiction can be exercised pursuant to CPLR § 301, § 1391(c) is satisfied and that venue is proper in the Southern District.

 3. Transfer

 Mi-Lor has also moved to transfer this case pursuant to 28 U.S.C. § 1404(a). Balancing the factors to be considered in 1404(a) motions, including the convenience of the parties, the ease of access to sources of proof, and practical problems relating to the expeditious resolution of the case, I deny the motion.

 The defendants bear the burden of establishing that the factors listed above justify transferring this case. P I, Inc. v. Valcour Imprinted Papers, Inc., 465 F. Supp. 1218 (S.D.N.Y. 1979). Although Mi-Lor asserts that the ultimate resolution of the case will be eased by transferring the case, the fact that Mi-Lor is a Massachusetts company is not enough to warrant that conclusion. Moreover, a preliminary injunction hearing has already been held, and it seems unwise to transfer a case after initial substantive decisions have already been made. In the absence of a ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.