Noxell Corp. v. Firehouse No. 1 Bar-B-Que Restaurant, BAR-B-QUE

• Decision Date: 16 April 1985
• Docket Number: BAR-B-QUE,Nos. 84-5167,No. 1,I,84-5196,B-Q,1,s. 84-5167
• Citation: 245 U.S. App. D.C. 242,760 F.2d 312
• Parties: , 226 U.S.P.Q. 861 NOXELL CORPORATION, et al., Appellants, v. FIREHOUSE NO. 1RESTAURANT, d/b/a San Francisco Firehouse Stationnc., et al. NOXELL CORPORATION, et al. v. FIREHOUSE NO. 1RESTAURANT, d/b/a San Francisco Firehouse Stationnc., et al., Appellants, Peter Lyons, d/b/a FirehouseBar-ue Restaurant.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 312

760 F.2d 312

245 U.S.App.D.C. 242, 226 U.S.P.Q. 861

NOXELL CORPORATION, et al., Appellants, v. FIREHOUSE NO. 1 BAR-B-QUE RESTAURANT, d/b/a San Francisco

Firehouse Station No. 1, Inc., et al.

NOXELL CORPORATION, et al. v. FIREHOUSE NO. 1 BAR-B-QUE RESTAURANT, d/b/a San Francisco

Firehouse Station No. 1, Inc., et al., Appellants,

Peter Lyons, d/b/a Firehouse No. 1 Bar-B-Que Restaurant.

Nos. 84-5167, 84-5196.

United States Court of Appeals District of Columbia Circuit.

Argued March 25, 1985.

Decided April 16, 1985.

George T. Mobille, Washington, D.C., with whom Robert W. Adams, Washington, D.C., was on brief, for appellants in No. 84-5167 and cross-appellees in No. 84-5196.

Seth P. Waxman, Washington, D.C., with whom Stephen L. Nightingale, Washington, D.C., was on brief, for appellees in No. 84-5167 and cross-appellants in No. 84-5196.

Before WALD, GINSBURG, and SCALIA, Circuit Judges.

Opinion for the Court filed by Circuit Judge GINSBURG.

GINSBURG, Circuit Judge:

This opinion sets out established law for this circuit on two matters. The first concerns review by cross appeal of orders that deny motions regarding venue. See 28 U.S.C. Sec. 1404(a) (1982) (inconvenient forum--transfer); ¹ id. Sec. 1406(a) (wrong forum--dismissal or transfer). ² The second concerns identification, for venue purposes, of the district "in which the claim arose." See id. Sec. 1391(b). ³ We rule as follows on the issues presented:

1. When a plaintiff appeals from the denial of a preliminary injunction, it is proper for the defendant to raise by cross appeal a venue objection timely presented to, but denied by, the district court.

2. In determining districts in which a claim may be regarded as having arisen for purposes of 28 U.S.C. Sec. 1391(b) where there is arguably more than one such district, the controlling factors are the accessibility of relevant evidence and the convenience of the defendant (but not of the plaintiff).

I. BACKGROUND

Noxell Corporation (Noxell), incorporated in Maryland, and its wholly-owned Texas subsidiary, Caliente Chili, Inc. (Caliente), chose the District Court for the District of Columbia as the place to lodge a trademark infringement action against Firehouse No. 1 Bar-B-Que Restaurant (Firehouse) and its proprietor, Carl T. English, Jr. Noxell develops, manufactures, and sells a variety of cosmetic, food, and household products. Firehouse operates two barbeque restaurants, both in San Francisco; English, founder and president of Firehouse, is a full-time San Francisco firefighter.

Caliente has registered the marks FALSE ALARM, 1-ALARM, 2-ALARM, and 3-ALARM, and uses them on chili mixes and other products in the hot and spicy food field. Firehouse markets only one product, under the name Firehouse No. 1 Bar-B-Que Sauce, derived from the recipe of English's grandparents. To denote the degree of hotness of the barbeque, the bottom portion of each Firehouse label includes the words 1 ALARM, 2 ALARM, or 3 ALARM. Noxell seeks to enjoin Firehouse from using "alarm" designations.

Firehouse has no office or employees outside the San Francisco area. At the time Noxell lodged its complaint here, no more than 200 cases of Firehouse's product had been sold in the District. This number of cases amounted to less than 1.5% of Firehouse's total barbeque sauce sales. By contrast, 40% of Firehouse's total barbeque sauce sales occur in California.

Noxell filed its complaint on October 19, 1983. On November 14, Firehouse moved to dismiss or transfer (pursuant to 28 U.S.C. Sec. 1406(a) or, alternately, 28 U.S.C. Sec. 1404(a)) to the Northern District of California. In an order dated December 21, 1983, the district court denied the motion. The order is spare. It simply recites that the court "finds venue in [the District of Columbia] proper and that the convenience of parties and witnesses and the interest of justice would not be served by a transfer to the Northern District of California." The order additionally states: "An Opinion will follow." In fact, however, no opinion ever followed. Thus we do not know why the district court concluded that Noxell's case against Firehouse should be aired here rather than in California.

II. APPEALABILITY

After rejecting Firehouse's venue objection, the district court heard and then denied Noxell's motion for a preliminary injunction. Noxell appealed from that interlocutory ruling pursuant to 28 U.S.C. Sec. 1292(a)(1). ⁴ Firehouse thereupon challenged by cross appeal the district court's unexplained denial of its motion objecting to venue in the District of Columbia. Noxell here maintains that the district court's refusal to dismiss or transfer pursuant to 28 U.S.C. Sec. 1406(a) or, alternately, 28 U.S.C. Sec. 1404(a), may not be reviewed independently because it is not a "final decision" within the meaning of 28 U.S.C. Firehouse essentially demurs to the initial points made by Noxell. Firehouse seeks no "independent" review. It does not claim that the district court's refusal to dismiss or transfer is a "final" disposition reviewable under 28 U.S.C. Sec. 1291. Further, in the absence of the promised opinion giving reasons for the district court's ruling, Firehouse could hardly seek and anticipate immediate certification under 28 U.S.C. Sec. 1292(b), for that provision requires the district court to identify precisely the "controlling question of law as to which there is substantial ground for difference of opinion."

Sec. 1291, and no certification pursuant to 28 U.S.C. Sec. 1292(b) has been obtained. Most critically, Noxell insists that the district court's venue ruling may not be reviewed as a matter ancillary to Noxell's own appeal from the denial of a preliminary injunction. ⁵

We think it beyond reasonable doubt, however, that Firehouse's challenge to the venue ruling is properly appended, by way of cross appeal, to Noxell's appeal. ⁶ We repeat what we have already said on this question:

[A] federal court of appeals reviewing an interlocutory injunctive order has power to pass on the correctness of a denial of a motion to dismiss for want of jurisdiction and failure to state a cause of action. This principle applies with full force to [defendants'] motion to dismiss for improper venue....

Lee v. Ply * Gem Industries, Inc., 593 F.2d 1266, 1270 (D.C.Cir.) (emphasis supplied), cert. denied, 441 U.S. 967, 99 S.Ct. 2417, 60 L.Ed.2d 1073 (1979). The above-stated position, to which we adhere, sensibly advances the just and efficient determination of civil actions. As explained by leading commentators:

Review [of interlocutory orders] quite properly extends to all matters inextricably bound up with the remedial decision. In addition, the scope of review may extend further to allow disposition of all matters appropriately raised by the record.... Jurisdiction of the interlocutory appeal is in large measure jurisdiction to deal with all aspects of the case that have been sufficiently illuminated to enable decision by the court of appeals without further trial court development. Any other rule frequently would require wasted litigation without any offsetting advantage in economy of appellate effort or uninterrupted trial court proceedings.

C. WRIGHT, A. MILLER, E. COOPER & E. GRESSMAN, FEDERAL PRACTICE AND PROCEDURE Sec. 3921, at 17 (1977).

III. VENUE WHERE THE CLAIM AROSE

Finding no support in statute law, this circuit's decisions, or good sense for Noxell's arguments on appealability, we turn to the merits of Firehouse's venue objection. A plaintiff who establishes jurisdiction over the defendant's person must additionally meet venue specifications. For federal question cases such as this one, Congress has authorized suit "only in the judicial district where all defendants reside, or in which the claim arose." 28 U.S.C. Sec. 1391(b). The Northern District of California is the district where all defendants At oral argument, Noxell affirmed that Caliente's products are marketed in California, and that California is indeed a place where the claim arose. But Noxell asserts that the claim arose in other places as well, particularly in the District of Columbia, based largely on the availability for sale of both Firehouse's sauce and Caliente's "2-ALARM" products in local food shops. In so arguing, Noxell appears to have collapsed or homogenized issues of personal jurisdiction and venue that should be analyzed discretely. See Johnson Creative Arts, Inc. v. Wool Masters, Inc., 743 F.2d 947, 949 (1st Cir.1984) ("The minimum contacts test for personal jurisdiction is based on the minimum amount of 'fairness' required in order to comport with due process. Venue limitations generally are added by Congress to insure a defendant a fair location for trial and to protect him from inconvenient litigation."); see also id. at 951-52 (personal jurisdiction and venue "concepts are independent of each other and must be interpreted with their respective underlying objectives and rationales in mind").

                reside. 7   Therefore, Noxell's right to maintain the action in the District of Columbia depends entirely on qualification of this district as the place "in which the claim arose."
                

The Supreme Court has spoken definitively to the venue issue at stake. The Court's pronouncement makes it unnecessary for us to embroider the point and renders Noxell's presentation all the more remarkable. We recite and follow the High Court's instruction on the proper interpretation of section 1391(b)'s "claim arose" language:

[I]t is absolutely clear that Congress did not intend to provide for venue at the residence of the plaintiff or to give that party an unfettered choice among a host of different districts.... In our view, ... the broadest interpretation of the language of Sec. 1391(b) that is even arguably acceptable is that in the unusual case in which it is not clear that the claim arose in only one specific district, a plaintiff may choose between those two (or conceivably even more) districts...