Mode Art Jewelers Co. v. Expansion Jewelry Ltd., 75 Civ. 519 (WCC).

• Decision Date: 04 March 1976
• Docket Number: No. 75 Civ. 519 (WCC).,75 Civ. 519 (WCC).
• Parties: MODE ART JEWELERS CO., Plaintiff, v. EXPANSION JEWELRY LTD. and Fashion High Creations, Inc., Defendants.
• Court: U.S. District Court — Southern District of New York

409 F. Supp. 921

MODE ART JEWELERS CO., Plaintiff, v. EXPANSION JEWELRY LTD. and Fashion High Creations, Inc., Defendants.

No. 75 Civ. 519 (WCC).

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

March 4, 1976.

Amster & Rothstein, New York City, for plaintiff; Morton Amster, New York City, of counsel.

Drummond, Nelson & Ptak, Phoenix, Ariz., for defendants; William H. Drummond, LaValle D. Ptak, Phoenix, Ariz., of counsel.

Curtis, Morris & Safford, P.C., New York City, Local Counsel for defendants; John A. Mitchell, Pasquale A. Razzano, New York City, of counsel.

MEMORANDUM AND ORDER

CONNER, District Judge:

This is another of the seemingly inevitable struggles for choice of forum which bedevil the Courts in industrial property litigation, here a controversy over alleged infringement of ten registered copyrights on costume jewelry.

On February 4, 1975, Mode Art Jewelers Co. (Mode Art), a New York corporation engaged in the manufacture and sale of such jewelry, brought this action for copyright infringement against Fashion High Creations, Inc. (Fashion High), the Arizona corporation which manufactured the accused jewelry and Expansion Jewelry Ltd. (Expansion), a New York corporation, which buys the jewelry from Fashion High and resells it through a retail store in New York City.

Six weeks later, on March 21, 1975, Fashion High and Expansion brought against Mode Art in the United States District Court for the District of Arizona a civil action, No. 75-174 PHX WPC (the Arizona action), (1) for a declaratory judgment of invalidity of the ten registrations in suit here on the ground that the designs were originated by Fashion High and the accused pieces were made and sold by it before the dates of publication alleged in the registrations, and (2) for alleged unfair competition in threatening Fashion High's customers with legal action, resulting in loss of sales by Fashion High.

Three days later, on March 24, 1975, Fashion High moved in this Court for an order staying all proceedings in this action pending determination of the Arizona action. On October 9, 1975, Mode Art filed its opposition to that motion and its own motion to enjoin Fashion High and Expansion from further proceedings in the Arizona action.

From an inspection of several of the Fashion High and Mode Art jewelry pieces at a conference in chambers, it is obvious that such perfect duplication could not have resulted from independent work. Undoubtedly either there was copying by one party from the other, or both derive from a common source. Mode Art has submitted an affidavit of its designer, Dominic Napolitano, asserting that he originated the designs in question. Just who was the originator and who the copyist is thus a disputed issue of material fact which, of course, cannot be resolved on conflicting affidavits. However, it need not be resolved in order to dispose of the present motions.

The motion of Fashion High and Expansion for a stay of this action is based upon the alleged grounds that

1) this Court lacks personal jurisdiction over Fashion High;

2) insofar as the claim against Fashion High is concerned, venue in this District is improper;

3) the Arizona court has personal jurisdiction over Mode Art; and

4) Expansion is only a customer; Fashion High and Mode Art are the real parties in interest and the Arizona action between them should proceed with this action being stayed for judicial economy.

In opposition to the motion to stay and in support of its motion to enjoin prosecution of the Arizona action, Mode Art asserts that

1) this action, having been filed first, should be the one to proceed;

2) this Court has personal jurisdiction over Fashion High;

3) the issue of venue in this Court is "improperly raised"; and

4) the Arizona court lacks personal jurisdiction over Mode Art.

I. Venue and personal jurisdiction over Fashion High.

On the critical venue issue, neither party cited a single authority, not even the copyright venue statute, 28 U.S.C. § 1400(a).

That statute provides that actions for copyright infringement may be brought "in the district in which the defendant or his agent resides or may be found."

Under 28 U.S.C. § 1391(c), a corporation is a resident of "any judicial district in which it is incorporated or licensed to do business or is doing business * * *."

A corporation is "found" in any district in which personal jurisdiction might be obtained over it. Geo-Physical Maps v. Toycraft Corp., 162 F.Supp. 141, 146-47 (S.D.N.Y.1958); Backer v. Gonder Ceramic Arts, 90...