Roberts-Gordon, LLC v. Superior Radiant Products

Decision Date25 February 2000
Docket NumberNo. 99-CV-90A.,99-CV-90A.
PartiesROBERTS-GORDON, LLC, Plaintiff, v. SUPERIOR RADIANT PRODUCTS, LTD., Defendant.
CourtU.S. District Court — Western District of New York

Buchanan Ingersoll, P.C., Linda H. Joseph, of counsel, Buffalo, New York, for plaintiff.

Sullivan & Oliverio, Richard T. Sullivan, of counsel, Buffalo, New York, for defendant.

ORDER

ARCARA, District Judge.

The above-referenced case was referred to Magistrate Judge Leslie G. Foschio pursuant to 28 U.S.C. § 636(b)(1)(B), on March 22, 1999. On February 4, 2000, Magistrate Judge Foschio filed a Report and Recommendation, recommending that defendant's motion to dismiss be denied and plaintiff's cross-motion for discovery be dismissed as moot. Alternatively, the Magistrate Judge recommended that plaintiff's cross-motion for discovery be granted, defendant's motion to dismiss should be continued and that plaintiff's motion for sanctions be denied.

The Court has carefully reviewed the Report and Recommendation, the record in this case, and the pleadings and materials submitted by the parties. No objections having been timely filed, it is hereby

ORDERED, that pursuant to 28 U.S.C. § 636(b)(1), and for the reasons set forth in Magistrate Judge Foschio's Report and Recommendation, defendant's motion to dismiss is denied and plaintiff's cross-motion for discovery is dismissed as moot. Alternatively, plaintiff's cross-motion for discovery is granted, defendant's motion to dismiss is continued and plaintiff's motion for sanctions is denied. The case is referred back to the Magistrate Judge for further proceedings.

IT IS SO ORDERED.

REPORT and RECOMMENDATION

FOSCHIO, United States Magistrate Judge.

DECISION and ORDER1

JURISDICTION

This case was referred to the undersigned on March 22, 1999 by the Honorable Richard J. Arcara for report and recommendation on dispositive motions. It is currently before the court on Defendant's motion to dismiss filed March 16, 1999 (Docket Item No. 3), Plaintiff's cross-motion for discovery filed April 19, 1999 (Docket Item No. 7), and Plaintiff's motion for sanctions filed May 13, 1999 (Docket Item No. 16).

BACKGROUND

Plaintiff, Roberts-Gordon, LLC, successor to Roberts-Gordon, Inc., commenced this action on February 4, 1999, alleging Defendant, Superior Radiant Products, Ltd., infringed on Plaintiff's rights in its trademarks names, marks and logos by using them as "metatags" on Superior's Internet web site. Four causes of action are asserted in the Complaint including (1) trademark infringement in violation of the United States trademark act ("the Lanham Act"), 15 U.S.C. §§ 1051-1127 and New York General Business Law § 360-k (McKinney 1999), (2) unfair competition in violation of the Lanham Act, 15 U.S.C. § 1125(a), (3) unfair competition in violation of New York common law, and (4) dilution of the distinctiveness of Plaintiff's trademark name, mark and logo in violation of the United States Trademark Dilution Act ("the Federal Dilution Act"), 15 U.S.C. § 1125(c) and New York's antidilution law, New York General Business Law § 360 et seq.

By stipulation filed on March 5, 1999, the parties set March 15, 1999 as the deadline for Defendant's answer. On March 16, 1999, Defendant filed a motion to dismiss the complaint based on lack of personal jurisdiction, supported by the Affidavit of Eric Willms ("Willms Affidavit I") and a Memorandum of Law (Docket Item No. 4) ("Defendant's Memorandum of Law"). In opposition to the motion to dismiss, Plaintiff filed on April 19, 1999, a cross-motion for discovery limited to jurisdiction, accompanied by the Affidavit of Paul Dines (Docket Item No. 9) ("Dines Affidavit"), and a Memorandum of Law (Docket Item No. 8) ("Plaintiff's Memorandum of Law"). In these supporting papers, Plaintiff advised the court that it had served Defendant with a motion under Fed.R.Civ.P. 11 alleging Defendant's motion to dismiss was based on allegedly false and misleading factual statements in the Willms Affidavit I; however, Plaintiff in accordance with Fed.R.Civ.P. 11(c)(1)(A), did not intend to file the motion for 21 days to provide Defendant with an opportunity to withdraw the motion.

On April 30, 1999, Defendant filed another affidavit by Eric Willms (Docket Item No. 11) ("Willms Affidavit II"), and a reply Memorandum of Law (Docket Item No. 12) ("Defendant's Reply Memorandum of Law"), in further support of the motion to dismiss. On May 4, 1999, Plaintiff filed a Sur-reply Affidavit by Linda H. Joseph, Esq., in further opposition to the motion to dismiss (Docket Item No. 13) ("Joseph Sur-reply Affidavit"). On May 7, 1999, Defendant filed an attorney affidavit in opposition to the cross-motion for discovery (Docket Item No. 15) ("Sullivan Affidavit I"). Plaintiff filed, on May 13, 1999, an attorney affidavit in further support of discovery (Docket Item No. 17) ("Joseph Discovery Affidavit"),

As Defendant did not withdraw the motion to dismiss, on May 13, 1999, Plaintiff moved for sanctions. Defendant filed another affidavit by Mr. Sullivan in opposition to the motion for sanctions on May 28, 1999 ("Docket Item No. 20") ("Sullivan Affidavit II"), attesting to the truthfulness of the factual statements made in support of the motion to dismiss. A further affidavit by Eric Willms in opposition to sanctions was filed by Defendant on June 1, 1999 (Docket Item No. 21) ("Willms Affidavit III"). On June 4, 1999, Plaintiff filed a memorandum of law in support of sanctions (Docket Item No. 22) ("Plaintiff's Memorandum of Law in Support of Sanctions"). Informal oral argument was conducted by telephone conference call on January 28, 2000.

Based on the following, Defendant's motion to dismiss should be DENIED as personal jurisdiction over Defendant exists pursuant to § 302(a)(3)(ii) of the New York Civil Practice Law and Rules, and Plaintiff's cross-motion for limited discovery is DISMISSED as moot. Alternatively, Defendant's motion to dismiss should be continued pending limited discovery on the jurisdictional question and Plaintiff's cross-motion for discovery GRANTED. Plaintiff's motion for sanctions is DENIED.

FACTS2

Plaintiff Roberts-Gordon, LLC, successor to Roberts-Gordon, Inc. ("Roberts-Gordon"), a Delaware corporation, maintains its principal place of business at 1250 William Street, Buffalo, New York. Since the 1960s, Roberts-Gordon has used registered trademarks in connection with its business of manufacturing and selling low intensity infrared heating equipment throughout the United States and elsewhere, including New York. Two such trademarks include "GORDON-RAY" registered March 28, 1967 (U.S.Reg. No. 826,409) and "CO-RAY-VAC" registered September 27, 1966 (U.S.Reg. No. 815, 870). Roberts-Gordon asserts its GORDON-RAY and CO-RAY-VAC names, marks and logos ("trademarks") are "extremely well known" among infrared heating equipment customers such that Roberts-Gordon owns valuable goodwill in its trademarks. Complaint, ¶ 11-12.

Defendant Superior Radiant Products, Inc. ("Superior"), a Canadian corporation, maintains its offices at 428 Millen Road, Unit 23, Stoney Creek, Ontario, Canada. Superior is also engaged in the manufacture and sale of low intensity infrared heating equipment. That Roberts-Gordon and Superior are competitors is undisputed. Both Eric Willms, President of Superior, and Timothy Seel, who has performed product design and engineering work for Superior in New York, were formerly employed by Roberts-Gordon.

According to Roberts-Gordon, it learned of the alleged trademark infringement when its Manager, Chairman and Chief Executive Officer, Paul Dines inputted Roberts-Gordon's registered trademarks GORDON-RAY and CO-RAY-VAC as keywords in an Internet search for Roberts-Gordon's web "site" and, instead, found a web site maintained by Superior located at http:/www.superiorradiant.com.3 Roberts-Gordon determined that the words "Gordon-Ray," "Gordonray," and "corayvac" were among the metatags assigned to Superior's web site.

By letter dated October 23, 1998, Roberts-Gordon requested Superior immediately cease all further use of Roberts-Gordon's trademarks as metatags in connection with Superior's web site and provide written confirmation of the web site change by October 30, 1998. Roberts-Gordon also demanded an accounting with respect to the alleged infringement and reimbursement of any related unlawful profits. Superior responded by letter dated October 29, 1998, advising Roberts-Gordon that the challenged metatags had been inadvertently placed in Superior's meta index file and had, as of October 26, 1998, been deleted. Superior also asserted it was unable to attribute any sales to its web site advertising, but indicated its willingness to consider any evidence Roberts-Gordon may have of such damages.

According to Roberts-Gordon, Superior never ceased using the trademarks as metatags for its web site and that an Internet search on March 24, 1999, using Roberts-Gordon's trademarks led to Superior's web site. Superior asserted that such results stemmed from the use of "old" or "cache" memory in a specific computer which was previously used to access Superior's web site. Roberts-Gordon disputes Superior's explanation because an Internet search using Roberts-Gordon's trademarks, performed on a computer that was "formatted" on April 30, 1999 and not used to access Superior's web site, also led to Superior's web site on May 1, 1999.

Superior has moved to dismiss the Complaint asserting that this court lacks personal jurisdiction based on its asserted lack of any basis to support long-arm jurisdiction in New York. In opposition to the motion, Roberts-Gordon submitted evidence purportedly demonstrating sufficient contacts to subject Superior to personal jurisdiction in New York. Roberts-Gordon also cross-moved for discovery limited to the jurisdiction issue should the court find, based on the pleadings and moving papers, the absence of personal...

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