HARLEY-DAVIDSON v. Columbia Tristar Home Video

• Decision Date: 03 May 1994
• Docket Number: No. 93-C-428.,93-C-428.
• Citation: 851 F. Supp. 1265
• Parties: HARLEY-DAVIDSON, INC., Plaintiff, v. COLUMBIA TRISTAR HOME VIDEO, INC., New Line Cinema Corp., and New Line Home Video, Defendants.
• Court: U.S. District Court — Eastern District of Wisconsin

851 F. Supp. 1265

HARLEY-DAVIDSON, INC., Plaintiff, v. COLUMBIA TRISTAR HOME VIDEO, INC., New Line Cinema Corp., and New Line Home Video, Defendants.

No. 93-C-428.

United States District Court, E.D. Wisconsin.

May 3, 1994.

Fred Wiviott, Michael E. Husmann, Dyann L. Bumpke, Jonathan H. Margolies, Michael, Best & Friedrich, Milwaukee, WI, for plaintiff.

Gary A. Essmann, Andrus, Sceales, Starke & Sawall, Milwaukee, WI, Joseph J. Santora, Larry Greenfield, Santora & Greenfield, New York City, for defendants.

DECISION AND ORDER

WARREN, District Judge.

On April 28, 1993, plaintiff Harley-Davidson, Inc. ("Harley-Davidson"), filed a complaint in the Eastern District of Wisconsin which, as amended on May 20, 1993, alleges that Columbia Tristar Home Video ("Columbia Tristar"), New Line Cinema Corp. ("New Line Cinema"), and New Line Home Video, Inc. ("New Line Home Video") (collectively the "defendants") used Harley-Davidson's registered trademark of the "Bar and Shield" design (the "Logo") in connection with the sale and advertising of a videocassette version of a film entitled Roadside Prophets, in violation of 15 U.S.C. §§ 1114-1118 & 1125 and common law governing trademark infringement and unfair competition. (Amended Complaint at ¶¶ 16-21.) Specifically, the alleged infringement consisted of the defendants placing a design, which Harley-Davidson claims is identical to the Logo except that it contains not the name of Harley-Davidson but rather the names of the lead actors in the film, in advertisements for the videocassette and on the videocassette box, (id. at ¶ 12), with the intent to trade on Harley-Davidson's reputation and goodwill, creating the likelihood of confusion, mistake and deception as to the source or sponsorship of the film. (Id. at ¶¶ 12-15.) Now before the Court is the defendants' motion to dismiss or transfer venue, for improper venue, pursuant to Rule 12(b)(3), Fed.R.Civ.P., and 28 U.S.C. § 1406(a), or, in the alternative, to transfer venue to the Southern District of New York, for the convenience of the parties and witnesses and in the interest of justice, pursuant to 28 U.S.C. §§ 1404(a) or 1406(a). Also before the Court is defendants' motion pursuant to Section 5.06(c), Local Rules, to seal certain supporting affidavits. For the following reasons, we deny both motions.

I. Background

Harley-Davidson is a Wisconsin corporation headquartered in Milwaukee, Wisconsin. (Brief in Opposition at 2.) Columbia Tristar is a New York partnership between CPT Holdings, Inc. and Columbia Pictures Home Video, both Delaware corporations and subsidiaries of Sony Pictures Entertainment, a Delaware corporation based in California. (David Pierce¹ Aff. at ¶ 2.) New Line Cinema is a Delaware corporation with its principal and executive offices in New York, New York. Its wholly-owned subsidiary, New Line Home Video, is a California corporation with its executive offices in New York, New York and principal offices in New York, New York and Los Angeles, California. (Benjamin Zinkin² Aff. at ¶ 2.)

New Line Home Video produces and distributes videocassettes and videodiscs for home viewing. (Id. at ¶ 4.) Pursuant to an agreement between New Line Home Video and RCA/Columbia Pictures Home Video (a New York partnership which was the predecessor in interest to Columbia Tristar) entered into on or about March 1, 1991 (the "Services Agreement"), Columbia Tristar has performed services for New Line Home Video in the sales and distribution for the home video market of certain films provided to Columbia Tristar by New Line Home Video. The Services Agreement was entered into in New York and provides that New York law governs its performance and construction. (Id. at ¶ 4.)

Roadside Prophets is one of the films provided by New Line Home Video and serviced by Columbia Tristar pursuant to the Services Agreement. (Zinkin Aff. at ¶ 4.) Columbia Tristar's domestic (United States and Canada) responsibilities with respect to the videocassette of Roadside Prophets were limited to sales-related activities, e.g., sales order-taking, packing and shipping, billings, collections, handling returns and credits, inventory taking, credit checking, sales reports, customer purchase analyses, and other similar services, (Pierce Aff. at ¶¶ 4, 5; Zinkin Aff. at ¶ 5), and distribution through its own network of eleven independent distributors. (Pierce Aff. at ¶ 5; Zinkin Aff. at ¶ 5.)

The artwork for and packaging of the videocassette of Roadside Prophets was created and otherwise handled by New Line Home Video, which delivered the materials to Columbia Tristar for ultimate shipment to its outside distributors. Copy and artwork for promotional materials for the videocassette also were provided by New Line Home Video. (Zinkin Aff. at ¶ 5.)³ None of the creation or production of any of the allegedly infringing product occurred in Wisconsin. (Pierce Aff. at ¶ 2; Zinkin Aff. at ¶¶ 2, 3.)

Roadside Prophets was released on videocassette in 1992 and enjoyed limited commercial success. A total of 8,071 copies of the videocassette of the film were shipped by Columbia Tristar for ultimate sale by outside distributors throughout the United States; of these, 120 copies of the videocassette were shipped into the State of Wisconsin. (Pierce Aff. at ¶ 7; Zinkin Aff. at ¶ 6.) More than 550 copies of the videocassette were shipped for sale in New York and New Jersey. (Pierce Aff. at ¶ 7.) The gross revenue generated to Columbia Tristar from the 120 videocassettes was approximately $7,020. (Id.) The revenue generated to New Line Home Video from the 120 videocassettes was approximately $6,800, or approximately 1.30 percent of the total revenue generated by the Roadside Prophets videocassette. (Zinkin Aff. at ¶ 6.) From March 1992 through February 1993, Columbia Tristar's net sales revenue exceeded $500 million. During the 1992 calendar year, Columbia Tristar's net revenue attributable to shipments into Wisconsin was $44,000, or approximately 0.008 percent of its 1992 fiscal year sales revenue. (Pierce Aff. at ¶ 8.) During 1992, 0.65 percent of New Line Cinema's total revenue for distribution in the United States of all home video product came from sales into Wisconsin. (Zinkin Aff. at ¶ 7.)⁴

Columbia Tristar has three field salespeople in the vicinity of Wisconsin, two in Illinois and one in Minnesota, in which states they respectively reside. Prior to November 1992, one such salesperson was responsible for working with the Wisconsin branch of one of Columbia Tristar's independent distributor. As such, the salesperson conducted sales meetings with that branch and contacted retailers in Wisconsin once every four to six weeks. Another salesperson took over this responsibility in November 1992, and visits Wisconsin once every six weeks. (Pierce at ¶ 6.)

None of the defendants is incorporated or licensed to do business in Wisconsin; owns, rents or leases any property in Wisconsin; or has any employees, bank accounts, telephone listings or post office boxes in Wisconsin. (Id. at ¶ 2; Zinkin Aff. at ¶ 3.) None of Columbia Tristar's independent distributors is headquartered, and only one of them has a branch office, in Wisconsin. (Pierce Aff. at ¶ 5.) At least five of the eleven distributors have branch offices in the New York metropolitan area; one of them has its corporate offices there. (Id.)⁵

Harley-Davidson's books and records relevant to this action are located in Wisconsin. (Wood Aff. at ¶ 5.) Columbia Tristar's books and records relevant to this action are located primarily in California (some may be in other regional offices); none are located in Wisconsin. (Id. at ¶ 2.) New Line Cinema's and New Line Home Video's books and records relevant to this action are located predominately in New York; none are located in Wisconsin. (Zinkin Aff. at ¶ 3.)

The known possible witnesses for Harley-Davidson are employed and reside in Wisconsin. (Wood Aff. at ¶ 5.) The known possible witnesses for Columbia Tristar are employed and reside in California and New York. (Id. at ¶ 9.) The known possible witnesses for New Line Cinema and New Line Home Video, as to the artwork, packaging and promotions; the revenues from sales; and their relationship with Columbia Tristar, are officers and employees in its offices predominately in New York (but to some extent in California). (Id. at ¶ 8.)

II. Discussion

As this case arises under the Lanham Act, 15 U.S.C. § 1051, et seq., the Court has subject matter jurisdiction pursuant to 28 U.S.C. § 1338.⁶ The defendants' motion to dismiss for improper venue is authorized by Rule 12(b)(3).⁷

The question of proper venue is solely a matter of federal law. Leroy v. Great Western United Corp., 443 U.S. 173, 183 n. 15, 99 S.Ct. 2710, 2716 n. 15, 61 L.Ed.2d 464 (1979). Pursuant to Section 1406(a), "the district court of a district in which is filed a case laying venue in the wrong division or district shall dismiss, or if it be in the interest of justice, transfer such case to any district or division in which it could have been brought." 28 U.S.C. § 1406(a). Where, as here, jurisdiction is not based solely on diversity of citizenship, venue properly lies:

... only in (1) a judicial district where any defendant resides, if all defendants reside in the same State, (2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial part of the property that is the subject of the action is situated, or (3) a judicial district in which any defendant may be found, if there is no district in which the action may otherwise be brought.

28 U.S.C. § 1391(b). For the purposes of Section 1391(b), a corporate⁸ defendant "shall be deemed to reside in any judicial district in which it is subject to personal jurisdiction at the time the action is commenced," 28 U.S.C. § 1391(c), a mandate that must be accorded its plain meaning. Dakota Industries, Inc. v. Dakota Sportswear, Inc., 946 F.2d 1384,...