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Detroit Coffee Company, LLC v. Soup for You, LLC

United States District Court, S.D. New York

February 16, 2018

DETROIT COFFEE COMPANY, LLC, Plaintiff,
v.
SOUP FOR YOU, LLC d/b/a DETROIT BOLD COFFEE CO. and ALLEN JAMES O'NEIL, Defendants.

          OPINION AND ORDER

          J. PAUL OETKEN, UNITED STATES DISTRICT JUDGE.

         In this case, a company called Detroit Coffee Company, LLC is suing a company called Detroit Bold Coffee Co. for trademark infringement. Defendants move to dismiss or transfer on the basis of improper venue, arguing that the case should be litigated in the Eastern District of Michigan, the home of the city for which both companies are named. For the reasons that follow, Defendant's motion is granted and the case is transferred.

         I. Background

         Plaintiff Detroit Coffee Company, LLC (“Detroit Coffee”) is a Michigan limited liability company, with its principal place of business located at its founder's home office in New York City. (Dkt. No. 29 (“Compl.”) ¶ 6; Dkt. No. 34-14 (“O'Neil Decl.”) ¶ 6.) Detroit Coffee sells coffee products throughout the United States under the trademark DETROIT COFFEE, which it registered in 2013. (Compl. ¶¶ 10 14.) Detroit Coffee alleges that it has continuously used the DETROIT COFFEE mark in commerce for thirteen years and that its mark is well known among its customers and throughout the national coffee market. (Compl. ¶¶ 16-17.)

         Detroit Coffee brings this action for infringement against Defendant Soup for You, LLC, doing business as Detroit Bold Coffee Co. (“Detroit Bold”), a Michigan limited liability company with its principal place of business in Michigan (Compl. ¶ 7), and Defendant Allen James O'Neil, Detroit Bold's founder and sole owner, who resides in Michigan (Compl. ¶¶ 8, 23). Detroit Bold sells coffee products using the marks DETROIT BOLD COFFEE COMPANY DB, DETROIT BOLD COFFEE CO., and DETROIT BOLD. (Compl. ¶ 21.) The vast majority of Detroit Bold's sales occur in the state of Michigan, but the company also makes its coffee available for sale online. (O'Neil Decl. ¶¶ 15-16.) The Complaint alleges that Detroit Bold's marks are confusingly similar to Detroit Coffee's. (Compl. ¶¶ 37-39, 56, 58-60.)

         Defendants move to dismiss the Complaint for improper venue, or, in the alternative, to transfer the case to the Eastern District of Michigan. They also move to dismiss the Complaint as against Defendant O'Neil for lack of personal jurisdiction.[1] (Dkt. No. 31.)

         II. Legal Standard

         “On a motion to dismiss for improper venue under Rule 12(b)(3), the burden of proof lies with the plaintiff to show that venue is proper.” Cartier v. Micha, Inc., No. 06 Civ. 4699, 2007 WL 1187188, at *2 (S.D.N.Y. Apr. 20, 2007). Unless the court holds an evidentiary hearing, “the plaintiff need only make a prima facie showing of [venue].” Gulf Ins. Co. v. Glasbrenner, 417 F.3d 353, 355 (2d Cir. 2005) (alteration in original) (quoting CutCo Indus. v. Naughton, 806 F.2d 361, 364-65 (2d Cir. 1986)). A court may consider facts outside of the pleadings when resolving a motion to dismiss for improper venue. See Japan Press Serv., Inc. v. Japan Press Serv., Inc., No. 11 Civ. 5875, 2013 WL 80181, at *4 (E.D.N.Y. Jan. 2, 2013).

         When a defendant challenges both personal jurisdiction and venue, a court may consider venue first “when there is a sound prudential justification for doing so.” Leroy v. Great W. United Corp., 443 U.S. 173, 180 (1979). “[W]here personal jurisdiction would likely exist in the transferee district over a defendant who contests personal jurisdiction in the Southern District of New York, it is ‘prudentially appropriate to address venue first since a decision to transfer would render personal jurisdiction analysis with respect to [the Southern District] irrelevant.'” Everlast World's Boxing Headquarters Corp. v. Ringside, Inc., 928 F.Supp.2d 735, 741 (S.D.N.Y. 2013) (alteration in original) (quoting Basile v. Walt Disney Co., 717 F.Supp.2d 381, 385-86 (S.D.N.Y. 2010)).

         III. Discussion

         A. Venue in the Southern District of New York

         The federal venue statute provides that “[a] civil action may be brought in . . . (1) a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located; [or] (2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred . . . .” 28 U.S.C. § 1391(b).[2] Because Defendants do not both reside in New York, [3] venue is proper in this district only if “a substantial part of the events or omissions giving rise to the claim occurred” in the Southern District of New York. Id.

         “[I]n trademark infringement claims, . . . venue may be proper in each jurisdiction where infringement is properly alleged to have occurred.” Pilates, Inc. v. Pilates Inst., Inc., 891 F.Supp. 175, 182 (S.D.N.Y. 1995). Infringement occurs wherever the alleged consumer confusion occurs. “[I]t is not the assembling of the product and the affixing of the infringing trademark that controls for purposes of venue in trademark infringement case, but rather, it is the marketing and selling of the product.” Time Prods. v. J. Tiras Classic Handbags, Inc., No. 93 Civ. 7856, 1994 WL 363930, at *9 (S.D.N.Y. July 13, 1994).

         To demonstrate that a “substantial part” of the events giving rise to a claim of trademark infringement have occurred in a particular district, the plaintiff can demonstrate either substantial sales of the infringing product in the district or intentional targeting of the infringing product into the district. See D'Anton Jos, S.L. v. Doll Factory, Inc., 937 F.Supp. 320, 321 (S.D.N.Y. 1996) (“A substantial part of events occurs in New York if the defendant targets New York by advertising and actively pursues efforts to market the infringing product ...


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