Yacht Basin Provision Co. v. Bates
| Decision Date | 08 July 2022 |
| Docket Number | 7:21-CV-117-FL |
| Citation | 610 F.Supp.3d 800 |
| Parties | YACHT BASIN PROVISION COMPANY, d/b/a Provision Company, Plaintiff, v. Kathy BATES, Phillip Bates, Cyndi Moran, and PKC Investments, LLC, d/b/a Inlet Provision Company, Defendants. |
| Court | U.S. District Court — Eastern District of North Carolina |
Charles A. Burke, Womble Bond Dickinson (US) LLP, Raleigh, NC, John D. Wooten, IV, Womble Bond Dickinson (US) LLP, Greensboro, NC, Minnie Kim, Womble Bond Dickinson (US) LLP, Charlotte, NC, for Plaintiff.
Russell M. Racine, Cranfill Sumner & Hartzog LLP, Charlotte, NC, Paul H. Derrick, Freeman Mathis & Gary, LLP, Raleigh, NC, for Defendants.
This matter is before the court on defendants’ motion to dismiss pursuant to Rules 12(b)(2) and 12(b)(3) of the Federal Rules of Civil Procedure or, in the alternative, transfer pursuant to 28 U.S.C. § 1404(a) (DE 21). The issues raised have been briefed fully. For the following reasons, defendants’ motion is granted in part and denied in part as set forth herein.
Plaintiff, owner of a restaurant named Provision Company in Southport, North Carolina, commenced this action June 21, 2021, alleging infringement of its trademarks, in violation of 15 U.S.C. § 1114 and common law, unfair competition and cybersquatting, in violation of 15 U.S.C. § 1125, unfair and deceptive trade practices, in violation of N.C. Gen. Stat. § 75-1.1 et seq., and unjust enrichment in violation of North Carolina common law. In the operative second amended complaint, plaintiff asserts these claims against defendant PKC Investments, LLC, ("PKC Investments"), owner of a restaurant named Inlet Provision Company in Murrells Inlet, South Carolina, and the limited liability company's members, defendants Kathy Bates, Phillip Bates, and Cyndi Moran ("Moran"), (collectively, the "individual defendants"). Plaintiff seeks compensatory and treble damages, injunctive relief, and attorneys’ fees and costs.
In lieu of answer, defendants filed the instant motion to dismiss on the bases of Rules 12(b)(2) and 12(b)(3), asserting that this court lacks personal jurisdiction over them and that venue is improper. They move alternatively for transfer of this case to the United States District Court for the District of South Carolina, pursuant to 28 U.S.C. § 1404(a). Accordingly, the court stayed the parties’ scheduling conference activities pending resolution of that motion. Plaintiff objected, contending that it required limited jurisdictional discovery to contest properly defendants’ motion. The court granted plaintiff's request, allowing discovery limited to issues of the personal jurisdiction of this court over defendants.
After the close of that limited discovery, the parties completed briefing on the instant motion. In support of their motion, defendants rely on: 1) a screenshot of a portion of Inlet Provision Company's website; 2) affidavit of defendant Phillip Bates; and 3) deposition testimony of defendants Phillip Bates, Kathy Bates, and Moran. In opposition to that motion, plaintiff relies on the same deposition testimony and additionally: 1) email correspondence among defendant Moran, an individual named Bob Durand, and Tonya Carroll, an employee of Grand Strand Magazine; 2) a document detailing transactions by Inlet Provision Company; 3) the "media kit"1 of Grand Strand Magazine; 4) a Grand Strand Magazine document listing "Where To Buy Grand Strand Magazine"; 5) The media kit of a magazine entitled Sasee; 6) email correspondence between and among defendant Moran and employees of the Strand Media Group, which is involved in publishing and/or marketing Sasee magazine; 7) screenshots of customer reviews of Inlet Provision Company on the websites "Yelp" and "Tripadvisor"; 8) a list of emails collected by the Inlet Provision Company website's mailing list function; 9) a screenshot of a coupon for Inlet Provision Company on a mobile application related to "Town Planner"; 10) an invoice for advertisements purchased by Inlet Provision Company from "WAVE 104.1"; 11) a screenshot of a webpage of "radiolineup.com"; 12) an annotated map of southeastern North Carolina; and 13) affidavit of Paul Swenson, owner of plaintiff.2
The court heard argument on the instant motion on May 19, 2022, and took the motion under advisement.
The court finds the following facts by the preponderance of the evidence.
Plaintiff is a North Carolina corporation that operates the Provision Company restaurant in Southport, North Carolina, which was established in the early 1990s. (Compl. (DE 46) ¶¶ 1, 17).3 The restaurant, as described by plaintiff, has "the rustic look and feel of an old trading post or fishing and tackle store," with a sign, pictured as follows, stating that it offers "charters, provisions, supplies, and advice":
(Id. ¶¶ 18, 25). Plaintiff owns U.S. Trademark Registration No. 2,364,222 for a "YACHT BASIN PROVISION CO." mark, (DE 46-4), and purports to own common law rights in a "PROVISION COMPANY" mark. (Compl. ¶ 19).
As pertinent to the instant motion, the foundation of plaintiff's claim is that defendants operate the Inlet Provision Company restaurant as essentially a copy of plaintiff's Provision Company restaurant. Defendants’ restaurant is located in Murrells Inlet, South Carolina, and opened in 2019. (Phillip Bates Aff. (DE 22-2) ¶ 3, 10, 11-13; Moran Dep. (DE 37-3, 38-3) at 43:15-17, 137:10-15).4 The sign for defendants’ restaurant appears as follows:
(Compl. ¶ 25).
Defendant PKC Investments is a South Carolina limited liability company with its principal place of business in Murrells Inlet, South Carolina. (Phillip Bates Aff. (DE 22-2) ¶ 10). Defendant PKC Investments is owned by the individual defendants, who are all current residents of South Carolina. (Id. ¶¶ 3, 5, 10-13). Specifically, defendant Moran is in charge of "advertising and marketing" for the restaurant. (Phillip Bates Dep. (DE 38-2) at 114:16-18).
Defendants have a number of personal connections to North Carolina. Defendant Phillip Bates is a former North Carolinian, having lived in Southport specifically until departing the state in 1989 or 1990. (Phillip Bates Dep. (DE 38-2) at 12:20-13:4; Phillip Bates Aff. (DE 22-2) ¶ 5). Defendant Kathy Bates, too, is a former resident of Southport, North Carolina, having moved away in 1990. (Kathy Bates Dep. (DE 38-4) at 5:18-6:18).
The two (collectively, the "Bates Defendants") have also made a number of trips back to North Carolina after moving away. Kathy Bates's sister and parents live, or lived, in Southport, and the Bates Defendants used to periodically visit those relatives for holidays such as Christmas and Thanksgiving. (Phillip Bates Dep. (DE 38-2) at 26:12-27:6, 28:3-4; see also id. at 19:20-24 ()). The Bates Defendants also visited Southport for defendant Kathy Bates's father's funeral, after his death "a couple [of] years ago." (Id. at 24:5-14; see also Kathy Bates Dep. (DE 38-4) at 11:21-24 ()).
Defendant Moran, while never residing in North Carolina, has traveled to the state for overnight visits with her daughter in Charlotte "approximately 75 times ... in the past ten years." (Moran Dep. (DE 38-3) at 9:15-23, 10:16-11:13). She also attended the funeral of defendant Kathy Bates's father in Southport, as well as visiting Wilmington, North Carolina, for "shopping ... about 13 years ago." (See id. at 10:3-15).
Beyond their other visits to Southport, the Bates Defendants have been to the Provision Company restaurant itself. Defendant Phillip Bates ate at the restaurant approximately "four to five times ... between 1995 and 2000," as part of "flounder fishing" trips. (Phillip Bates Dep. (DE 38-2) at 18:22-19:19). Defendant Kathy Bates "probably" joined him for those meals and may have possibly eaten there other times. (Id. at 28:18-29:10; see Kathy Bates Dep. (DE 38-4) at 13:18-25). Finally, defendant Phillip Bates visited a second Provision Company restaurant location, not at issue in the complaint, in Holden Beach, North Carolina, in his role as a "beverage manager" for PYA/Monarch Foods, although he had moved to South Carolina by that time. (Phillip Bates Dep. (DE 38-2) at 13:10-15:7, 63:8-65:8).
Inlet Provision Company, itself, has ties to North Carolina. North Carolinians patronize the restaurant, (Phillip Bates Dep. (DE 38-2) at 70:8-15), as part of the influx of tourists during the summer. (Moran Dep. (DE 38-3) at 36:21-22). The restaurant itself is approximately 40 miles from the North Carolina border. (Phillip Bates Aff. (DE 22-2) ¶ 19; see Phillip Bates Dep. (DE 38-2) at 29:12-15).
Moreover, Inlet Provision Company has been advertised in ways available to North Carolinians, online and in print. The restaurant has an online website. (Website Screenshot (DE 22-1) at 1). It has been advertised by the Grand Strand Magazine, Sasee magazine, an entity called Town Planner, and a radio station called Wave 104.1 FM. (Moran Dep. (DE 38-3) at 39:12-25, 39:18-41:11, 43:12-17; Phillip Bates Dep. (DE 38-2) at 103:9-21). Inlet Provision Company is also able to be reviewed on Yelp and Tripadvisor's respective websites. (See, e.g., Customer Reviews (DE 38-13) at 2, 18).
The Inlet Provision Company's website, as it appeared prior to and at the initiation of this litigation, appears, in part, as follows:
(Website Screenshot (DE 22-1) at 1); see also Inlet Provision Co. Home Page, https://www.inletprovisioncompany.com/ [https://perma.cc/KZ24-VKL6 ].5 As can be seen above, the restaurant's website has a "Mailing List," which allows for visitors to the website to "sign up" to be on "the list" that could have been used to send out "a newsletter or some sort of [o...
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