Nursery Decals & More, Inc. v. Neat Print, Inc.
| Decision Date | 10 April 2020 |
| Docket Number | CIVIL ACTION NO. 3:19-CV-2606-B |
| Parties | NURSERY DECALS AND MORE, INC., Plaintiff, v. NEAT PRINT, INC., Defendant. |
| Court | U.S. District Court — Northern District of Texas |
Before the Court is Defendant Neat Print, Inc.'s Motion to Dismiss or in the Alternative, Motion to Abate (Doc. 8). For the reasons that follow, the Court DENIES the motion in full.
This is a trademark case. Plaintiff Nursery Decals is a Texas-based company that designs, markets, and sells wall decals, as well as clothing and accessories. Doc. 1, Compl., ¶ 7. Nursery Decals uses online marketplaces such as Amazon and Etsy to sell approximately $3,500,000 in goods annually. Id. The sayings it uses on its clothing do not identify Nursery Decals, and "are purely informational and/or ornamental material displayed across the front of a t-shirt or other clothing." Id. "Defendant Neat Print is a Florida-based retailer of clothing, specifically t-shirts . . . ." Id. ¶ 8. Neat Print's clothing bears generic slogans and sayings, such as "Papa, the Man, the Myth, the Legend," "thankful," and "having a weird mom builds character." Id. Neat Print also uses onlineplatforms such as Amazon and Etsy. Id.
Nursery Decals alleges that Neat Print's business involves "applying for and/or obtaining invalid trademark registration of generic slogans and popular sayings," and then submitting "take down notices" on marketing platforms "on the basis of purported trademark infringement." Id. ¶ 21. Nursery Decals believes that "[t]he intent of such actions is to shut down competition and obtain a competitive edge over other T-shirt retailers . . . ." Id.
On July 8, 2014, Neat Print filed an application for trademark registration with the United States Patent and Trademark Office (USPTO) for the "BE NICE TO ME, MY WIFE IS PREGNANT" mark (Registration No. 4,746, 598) for use on clothing (hereinafter the "598 Mark"). Id. ¶ 9. Nursery Decals explains that although Neat Print warranted to the USPTO that no one had the right to use this mark such that use of the mark would not result in confusion, mistake, or deception, others had been using the mark before July 8, 2014 (hereinafter the "prior use" allegation). Id. Nursery Decals also alleges that the sample of the mark Neat Print submitted in its application was not an accurate depiction of how the mark was to be used on Neat Print's clothing (hereinafter the "false sample" allegation). Id. ¶ 11.
Also on July 8, 2014, Neat Print filed an application with the USPTO for registration of the "THE MAN BEHIND THE BUMP" mark (Registration No. 4,746,597) for use on clothing (hereinafter the "597 Mark"), and the "YOU CAN'T SCARE ME" mark (Registration No. 5,256,615) for use on clothing (hereinafter the "615 Mark"). Id. ¶¶ 12, 15. Nursery Decals repeats its prior use and false sample allegations with respect to the 597 and 615 marks. See id. at ¶¶ 12-14, 15-17.
Registrations for the 597 and 598 marks were issued on June 2, 2015, while registration forthe 615 mark was issued on August 1, 2017. Id. ¶¶ 12, 15.
On July 16, 2014, Neat Print filed an application with the USPTO for federal trademark registration for the "WORLD'S OKAYEST" mark (Registration No. 5,076,010) for use on clothing (hereinafter the "010 Mark"). Id. ¶ 18. Nursery Decals repeats its prior use and false sample allegations with respect to the 010 mark. Id. ¶¶ 18-20. Nursery Decals does not indicate when registration for this mark was issued.
On May 9, 2018, "just prior to Father's Day," Etsy notified Nursery Decals that Neat Print had filed a complaint with Etsy, based on Nursery Decals's purported trademark infringement in listing t-shirts with the phrases "Be Nice to Me My Wife is Pregnant" and "Man Behind the Bump." Id. ¶ 24. Etsy's notice was a "final warning" to Nursery Decals, which meant that the next complaint would result in Nursery Decals being banned from listing their products on Etsy. Id. Nursery Decals alleges, then, that it "had no choice but to remove from Etsy all listings for t-shirts that include any phrases registered by [Neat Print] as a purported trademark . . . ." Id. This resulted in "a significant loss in sales," including those on Father's Day, for Nursery Decals. Id. Nursery Decals, in attempt to avoid any similar problems with Amazon, pulled from Amazon its t-shirts that read "Be Nice to Me, My Wife is Pregnant," "World's Okayest," "Man Behind the Bump," and "You Don't Scare Me," which resulted in thousands of dollars in lost sales. Id. ¶ 25.
Based on these allegations, Nursery Decals brings eleven causes of action: (1) Declaratory Judgment of Non-Infringement (35 U.S.C. § 271, 15 U.S.C. § 1114); (2) Declaratory Judgment of Lack of Secondary Meaning; (3) Declaratory Judgment of Genericness; (4) Declaratory Judgment of Invalid Trademark Registration; (5) Declaratory Judgment of Fraud on the USPTO; (6) Cancellation of the 598 Mark; (7) Cancellation of the 597 Mark; (8) Cancellation of the 010 Mark;(9) Cancellation of the 615 Mark; (10) Tortious Interference with Existing Business Relationship under Texas law; and (11) Tortious Interference with Prospective Business Relationship under Texas law. Doc. 1, Compl., 12-20. Nursery Decals also seeks to preliminarily and permanently enjoin Neat Print from engaging in certain actions, but did not file a formal preliminary injunction motion. Id. at 20-21.
Neat Print then filed a Motion to Dismiss or in the Alternative Abate, alleging a lack of both personal jurisdiction and an independent cause of action to support subject matter jurisdiction, improper venue, and failure to state a claim. See Doc. 8, Def.'s Mot., 1-2. All briefing has been filed on this motion, and the motion is ripe for review.
Federal Rule of Civil Procedure 12(b)(2) allows for the dismissal of an action in which the court lacks personal jurisdiction over the defendant. A federal court may assert jurisdiction over a nonresident defendant in a diversity suit if the state's long-arm statute applies and due process is satisfied under the Fourteenth Amendment to the United States Constitution. Cycles, Ltd. v. W.J. Digby, Inc., 889 F.2d 612, 616 (5th Cir. 1989). Texas courts have interpreted the Texas long-arm statute as "extending to the limits of due process." Bullion v. Gillespie, 895 F.2d 213, 215 (5th Cir. 1990). Accordingly, to determine whether it may assert jurisdiction under the Texas long-arm statute, a federal court must determine whether jurisdiction comports with federal constitutional guarantees of due process. Id. at 216.
"The due process clause of the Fourteenth Amendment, as interpreted by the Supreme Court, permits the exercise of personal jurisdiction over a nonresident defendant when (1) that defendant has established 'minimum contacts' with the forum state; and (2) the exercise of jurisdiction over that defendant does not offend 'traditional notions of fair play and substantial justice.'" Ruston Gas Turbines, Inc. v. Donaldson Co., Inc., 9 F.3d 415, 418 (5th Cir. 1993) (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)). "Both prongs of the due process test must be met" for the Court to exercise personal jurisdiction over a defendant. See id.
A nonresident defendant's minimum contacts may either support an assertion of specific or general jurisdiction. WNS Inc. v. Farrow, 884 F.2d 200, 202 (5th Cir. 1989). A court may exercise specific jurisdiction when a cause of action arises out of a defendant's purposeful contacts with the forum. Dalton v. R & W Marine, Inc., 897 F.2d 1359, 1361-62 (5th Cir. 1990). Alternatively, a court is said to have general jurisdiction when a defendant has engaged in continuous and systematic contacts with the forum. Id.
The party seeking to invoke federal jurisdiction bears the burden of establishing the requisite minimum contacts. WNS, 884 F.2d at 203. Further, "uncontroverted allegations in the plaintiff's complaint must be taken as true, and conflicts between the facts contained in the parties' affidavits must be resolved in the plaintiff's favor for purposes of determining whether a prima facie case for personal jurisdiction exists." D.J. Invs., 754 F.2d at 546 (citations omitted).
A defendant may move to dismiss or transfer a case for improper venue under Federal Rule of Civil Procedure 12(b)(3). Once a defendant has objected to venue, the burden shifts to the plaintiff to establish that venue is proper. Wolf Network, LLC, v. AML Diagnostics, Inc., No. 3:15-cv-3797-B, 2016 WL 1357742, at *1 (N.D. Tex. Apr. 5, 2016).2 28 U.S.C. § 1391 sets out three categories of proper venue:
(1) a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is located; (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 property that is the subject of the action is situated; and (3) if there is no district in which an action may otherwise be brought as provided in this section, any judicial district in which any defendant is subject to the court's personal jurisdiction with respect to such action.
28 U.S.C. § 1391(b)(1)-(3). "When venue is challenged, the court must determine whether the case falls within one of the[se] three categories." Atl. Marine Constr. Co., Inc. v. U.S. Dist. Court for the W. Dist. of Tex., 571 U.S. 49, 56 (2013). In making this decision, the court must accept as true all of Plaintiff's factual allegations "and resolve all factual conflicts in Plaintiff's favor." Nuttall, 984 F. Supp. 2d at 642. "[T]he court is permitted to look at evidence in the record beyond simply those facts alleged in the complaint and its proper attachments." Ambraco, Inc. v. Bossclip B.V., 570 F.3d 233, 238 (5th Cir. 2009). If the plaintiff's choice of forum falls within one of the above categories, then venue is proper. But if it does not,...
To continue reading
Request your trial