Chatwal Hotels & Resorts LLC v. Dollywood Co., 14–cv–8679 CM.

• Decision Date: 06 February 2015
• Docket Number: No. 14–cv–8679 CM.,14–cv–8679 CM.
• Parties: CHATWAL HOTELS & RESORTS LLC, Plaintiff, v. The DOLLYWOOD COMPANY, Herschend Family Entertainment Corporation, and Dolly Parton Productions, Inc., Defendants.
• Court: U.S. District Court — Southern District of New York

90 F.Supp.3d 97

CHATWAL HOTELS & RESORTS LLC, Plaintiff

v.The DOLLYWOOD COMPANY, Herschend Family Entertainment Corporation, and Dolly Parton Productions, Inc., Defendants.

No. 14–cv–8679 CM.

United States District Court, S.D. New York.

Signed Feb. 6, 2015.

Karl F. Milde, Jr., Milde & Hoffberg, LLP, Robert William Morris, Eckert, Seamans, Cherin & Mellott LLC, White Plains, NY, for Plaintiff.

MEMORANDUM DECISION AND ORDER DENYING DEFENDANTS' MOTION TO DISMISS

McMAHON, District Judge.

Plaintiff Chatwal Hotels & Resorts LLC (“Chatwal”) brings this action against defendants The Dollywood Company (“Dollywood JV”), Herschend Family Entertainment Corporation (“Herschend”), and Dolly Parton Productions, Inc. (“DPP”). The complaint alleges that Dollywood JV, Herschend, and DPP infringed its trademarks and engaged in unfair competition in violation of The Lanham Act, 15 U.S.C. §§ 1051 et seq. Chatwal seeks declaratory and injunctive relief, as well as damages, attorneys' fees, and costs, pursuant to 15 U.S.C. § 1117.

Currently before the court is defendants' motion to dismiss for lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(2). For the reasons set forth below, this court concludes that it does have personal jurisdiction over the defendants; the motion to dismiss is denied.

BACKGROUND

Plaintiff Chatwal is a New York limited liability company, with headquarters located in New York. (Compl. ¶ 1.) Chatwal owns and operates a chain of luxury hotels in the United States and throughout the world, and has secured the DREAM mark and THE DREAM HOTEL mark in connection with its hotel services. (Compl. ¶¶ 6–10.) Of Chatwal's five DREAM hotels, two are located in New York and one is in Miami Beach. (Compl. ¶ 7.)

Dollywood JV is a joint venture organized under the laws of the State of Tennessee with its principal place of business in Pigeon Forge, Tennessee. (Compl. ¶ 2.) At the time of filing, Dollywood JV was composed of Herschend and DPP. (Id. ) Herschend is a Missouri corporation with its principal place of business in Georgia. (Wexler Decl. ¶ 3.) DPP is a California corporation with its principal place of business in Tennessee. (Miller Decl. ¶ 3.)

Dollywood JV was formed for the purpose of owning and operating the Dollywood amusement park in Pigeon Forge, Tennessee. (Ross Decl. ¶ 3.) Dollywood JV draws visitors to the theme park by advertising on dollywood.com, and with television advertisements targeting customers in Tennessee and some areas of Georgia. (Ross Decl. ¶ 6.) In 2012, Dollywood JV began plans to open a resort adjacent to the Dollywood theme park, selecting “Dollywood's DreamMore Resort”¹ as its name. (Ross Decl. ¶ 10.) On August 13, 2013, Dollywood JV secured the domain name “dreammoreresort.com” and filed an intent-to-use application to register the DOLLYWOOD'S DREAMMORE RESORT mark in the U.S. Patent and Trademark Office. (Compl. ¶ 13–14.)

The dreammoreresort.com website provides information about the future resort, which is planned to open in the summer of 2015. (Ross Decl. ¶ 12–14.) The website does not yet allow customers to make reservations, and no goods or services are offered for sale. (Id. at ¶ 14.) The website does allow customers to sign up for the “Founders Club” free of charge, providing members with news and information regarding the resort. (Id. ) More than 30,000 people signed up for the Founders Club, and approximately 1% of those individuals were New York residents. (Id. )

Dollywood JV contracted with the Ice Theater of New York to perform “Dollywood's Christmas on Ice.” (Metzger Decl. Exhibit B.) DPP has also entered into sporadic contracts with New York companies, such as providing composer-lyricist services for a musical performed in New York. (Plaintiff's Opposition at 9.) DPP filed New York state income tax returns from income derived from that contract. (Id. ) Herschend's subsidiary managed another theme park located in New York for several years. (Plaintiff's Opposition at 10.) Herschend is registered to do business in New York and has paid taxes in New York. (Id. )

Chatwal filed suit on October 30, 2014, alleging that the use of the DOLLYWOOD'S DREAMMORE RESORT mark infringes on Chatwal's federally registered trademarks, in violation of 15 U.S.C. § 1114, and unfair competition, in violation of 15 U.S.C. § 1125(a).

In November 2014—after the filing of this Complaint—Dollywood JV sent an offer to all Founders Club members, including the approximate 300 New York residents, allowing up to 1,000 individuals an opportunity to sign up for a special promotion for a $100.00 fee. (Id. at 15.)

DISCUSSION

I. Standard of Review

On a Rule 12(b)(2) motion to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of establishing that the court has jurisdiction over the defendants. In re Magnetic Audiotape Antitrust Litig., 334 F.3d 204, 206 (2d Cir.2003) ; DiStefano v. Carozzi N. Am., Inc., 286 F.3d 81, 84 (2d Cir.2001). The plaintiff's burden of proof “depends upon the procedural context in which the jurisdictional challenge in raised.” Navaera Scis., LLC v. Acuity Forensic Inc., 667 F.Supp.2d 369, 373 (S.D.N.Y.2009). Where, as here, no evidentiary hearing has been held, the plaintiff “need make only a prima facie showing by its pleadings and affidavits that jurisdiction exists.” CutCo Indus., Inc. v. Naughton, 806 F.2d 361, 365 (2d Cir.1986).

A determination regarding personal jurisdiction requires a factual inquiry that goes beyond the complaint, therefore “all pertinent documentation submitted by the parties may be considered in deciding the motion.” St. Paul Fire & Marine Ins. Co. v. Eliahu Ins. Co. Ltd., No. 96 Civ. 7269, 1997 WL 357989, at *1 (S.D.N.Y. June 26, 1997), aff'd, 152 F.3d 920 (2d Cir.1998) (internal quotations omitted). All pleadings and affidavits are to be construed in the light most favorable to the plaintiff, and any doubt is to be resolved in the plaintiff's favor. See Hoffritz for Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55, 57 (2d Cir.1985).

The plaintiff's complaint alleges federal claims of trademark infringement and unfair competition predicated on the Lanham Act, which does not contain its own jurisdictional provision. The court turns to the law of the forum state to determine whether personal jurisdiction exists. See Overseas Media, Inc. v. Skvortsov, 407 F.Supp.2d 563 (2d Cir.2006) ; Canterbury Belts Ltd. v. Lane Walker Rudkin, Ltd., 869 F.2d 34 (2d Cir.1989). We accordingly turn to the law of New York.

II. Personal Jurisdiction

To determine whether personal jurisdiction exists over a non-domiciliary, the court engages in a two-step inquiry. Chloe v. Queen Bee of Beverly Hills, LLC, 616 F.3d 158, 163 (2d Cir.2010) ; Best Van Lines, Inc. v. Walker, 490 F.3d 239, 244 (2d Cir.2007). First, the court determines whether the laws of the forum state permit the exercise of jurisdiction over the defendants. If the laws of the forum state permit jurisdiction, the court then determines whether the exercise of such jurisdiction comports with the requirements of due process. See Best Van Lines, 490 F.3d at 244.

In New York, there are two ways to establish personal jurisdiction over a defendant: (1) “general jurisdiction” under N.Y. C.P.L.R. § 301 ; and (2) “specific jurisdiction” under N.Y. C.P.L.R. § 302. Chatwal claims that this court may exercise both general and specific jurisdiction over the defendants. (Plaintiff's Opposition at 4–10.)

A. The Plaintiff Fails to Establish General Jurisdiction Under CPLR § 301

Under CPLR § 301, a New York court “may exercise such jurisdiction over persons, property, or status as might have been exercised heretofore.” Section 301 preserves the notion that a court may exercise general jurisdiction over a non-domiciliary defendant if the defendant is “engaged in such a continuous and systematic course of ‘doing business' here as to warrant a finding of its ‘presence’ in this jurisdiction.” Landoil Res. Corp. v. Alexander & Alexander Servs., Inc., 918 F.2d 1039, 1043 (2d Cir.1990) (citation omitted); Hoffritz for Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55, 58 (2d Cir.1985). General jurisdiction, or all-purpose jurisdiction, allows a court to hear “any and all” claims against a defendant. Goodyear Dunlop Tires Operations, S.A. v. Brown, ––– U.S. ––––, 131 S.Ct. 2846, 2851, 180 L.Ed.2d 796 (2011).

In Daimler AG v. Bauman, the Supreme Court addressed whether a foreign corporation could be subjected to a California court's general jurisdiction based on the contacts of the defendant's in-state subsidiary. Daimler AG v. Bauman, ––– U.S. ––––, 134 S.Ct. 746, 759, 187 L.Ed.2d 624 (2014). The Court held that, other than in an “exceptional case,” a corporation will be subject to all-purpose jurisdiction only in its place of incorporation and its principal place of business. Id. at 746, 761 n. 19. The Court explained that the relevant inquiry is not whether a corporation's activities within a forum are “in some sense continuous and systematic,” but rather “whether that corporation's affiliations with the State are so continuous and systematic as to render [it] essentially at home in the forum State.” Id. at 761 (quoting Goodyear, 131 S.Ct. at 2851 ) (internal quotations omitted). Daimler, a German corporation that manufactures Mercedes–Benz vehicles in Germany, Id. at 752, had a United States subsidiary, MBUSA, who was the exclusive importer and distributor of Daimler Mercedes–Benz vehicles for sale in the United States, including California. Id. Within the state of California, MBUSA had a regional office, a vehicle preparation center, and a classic center, and it was the largest supplier of luxury vehicles in California.Id. Obviously the subsidiary had a continuous presence in California, and the parent was able to do business in California through the subsidiary. Nonetheless, Daimler's contacts with California were deemed not significant enough to render the corporation “at home” in the forum. Id. at 762.

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