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JCS Industries LLC v. Designstein LLC

United States District Court, M.D. Florida, Orlando Division

October 22, 2019

JCS INDUSTRIES LLC, Plaintiff,
v.
DESIGNSTEIN LLC; and BRYAN KNOWLTON, Defendants.

          ORDER

          ROY B. DALTON JR. UNITED STATES DISTRICT JUDGE

         Before the Court is Defendants DesignStein LLC and Bryan Knowlton's Motion to Dismiss for Lack of Personal Jurisdiction. (Doc. 14 (“Motion”).) Plaintiff JCS Industries LLC responded (Doc. 17), and Defendants replied (Doc. 24). On review, the Motion is denied.

         I. Background

         This trademark dispute arises from Defendants' alleged illegal ownership and use of a domain name to deceive and defraud Plaintiff's existing and prospective customers. (Doc. 9, ¶ 1.) Plaintiff, a Florida limited liability company, advertises and sells water level regulators for swimming pools under the name STAYPOOLLIZER at www.staypoollizer.com (“Plaintiff's Website”).[1] (Id. ¶¶ 2, 9-11, 15.) According to Plaintiff, Defendants-a Texas limited liability company and Texas resident, respectively-also sell swimming pool water levelers under the name “Fill-O-Matic, ” which they did only after purchasing Plaintiff's product on April 11, 2018. (Id. ¶¶ 3-4, 18- 20.) On April 27, 2018, Defendants registered the domain name www.staypoolizer.com (“Defendants' Website”), which is identical to that of Plaintiff's Website but for omitting an “l, ” and redirected Defendants' Website to www.fill-o-matic.com-an interactive website where Defendants sell their water levelers. (Id. ¶¶ 21-22; see also Doc. 9-2, p. 2.) Plaintiff discovered Defendants' Website after its employee mistyped the domain name for Plaintiff's Website. (Doc. 9, ¶ 22.) Plaintiff contends Defendants willfully registered the domain name for Defendants' Website and diverted it to their Fill-O-Matic website “to capitalize on typographical errors committed by Plaintiff's existing and prospective customers.” (Id. ¶¶ 21, 23, 26.)

         Plaintiff demanded Defendants transfer the domain name for Defendants' Website to Plaintiff and compensate Plaintiff for lost sales due to Defendants' diversion of Plaintiff's customers, but Defendants refused. (Id. ¶ 27.) So Plaintiff sued Defendants for: (1) cybersquatting under 15 U.S.C. § 1125(d); (2) trademark infringement under 15 U.S.C. § 1114; (3) false designation of origin under 15 U.S.C. § 1125; (4) unfair competition under Florida's common law; and (5) deceptive and unfair trade practices under Florida Statutes §§ 501.201 et seq. (Id. ¶¶ 28-75.) Plaintiff seeks declaratory and injunctive relief, treble damages and profits, statutory and punitive damages, attorney's fees, costs, and prejudgment interest. (See id. at 11-13.)

         Now Defendants move to dismiss the amended complaint for lack of personal jurisdiction. (Doc. 14.) Briefing complete (see Docs. 17, 24), the matter is ripe.

         II. Legal Standards

         Federal Rule of Civil Procedure 12(b)(2) provides the mechanism for challenging a complaint for lack of personal jurisdiction. “The plaintiff has the burden of establishing a prima facie case of personal jurisdiction over a nonresident defendant.” Meier ex rel. Meier v. Sun Int'l Hotels, Ltd., 288 F.3d 1264, 1268-69 (11th Cir. 2002) (citation omitted); Posner v. Essex Ins. Co., 178 F.3d 1209, 1214 (11th Cir. 1999). If unrefuted, the Court accepts the well-pled facts as true. See Posner, 178 F.3d at 1215. But if “the defendant submits affidavits to the contrary, the burden traditionally shifts back to the plaintiff to produce evidence supporting jurisdiction unless those affidavits contain only conclusory assertions that the defendant is not subject to jurisdiction.” Meier, 288 F.3d at 1269 (citing Posner, 178 F.3d at 1215). Should the plaintiff's complaint and supporting evidence conflict with the defendant's affidavits, a court “must construe all reasonable inferences in favor of the plaintiff.” Id. (citing Madara v. Hall, 916 F.2d 1510, 1514 (11th Cir. 1990)).

         III. Analysis

         At issue is whether the Court has personal jurisdiction over the nonresident Defendants. Plaintiff says yes because “each Defendant has: (a) committed intentional and tortious acts within the state of Florida; (b) conducted substantial business within this state related to the unlawful activity at issue in this Complaint; and (c) otherwise availed themselves of this forum.” (Doc. 9, ¶ 7; see also Doc. 17.) Defendants say no because the only alleged connection Defendants have to Florida is that they damaged Plaintiff, a Florida company, but Plaintiff cannot establish Defendants have any other meaningful connection with Florida so exercising personal jurisdiction over them here would comport with the Due Process Clause of the Fourteenth Amendment. (See Doc. 14.) On review, the Court may exercise personal jurisdiction over Defendants.

         “A federal district court . . . may exercise personal jurisdiction to the extent authorized by the law of the state in which it sits and to the extent allowed under the Constitution.” Meir, 288 F.3d at 1269 (citations omitted). “The determination of personal jurisdiction over a nonresident defendant requires a two-part analysis.” Madara, 916 F.2d at 1514 (citations omitted). First, there must be a basis for jurisdiction under Florida's long-arm statute, which confers either general or specific personal jurisdiction over the nonresident. Id. at 1514, 1516 n.7 (citations omitted); see Fla. Stat. § 48.193. Second, exercising personal jurisdiction must comport with the Due Process Clause of the Fourteenth Amendment so “maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Madara, 916 F.2d at 1514 (quoting Int'l Shoe Co. v. State of Wash., Office of Unemployment Comp. & Placement, 326 U.S. 310, 316 (1945)).

         A. Long-Arm Statute

         Florida's long-arm statute “provides for both specific and general jurisdiction.” Louis Vuitton Malletier, S.A. v. Mosseri, 736 F.3d 1339, 1352 (11th Cir. 2013) (citing Fla. Stat. § 48.193(1)-(2)). “General personal jurisdiction exists when a defendant ‘is engaged in substantial and not isolated activity within this state . . . whether or not the claim arises from that activity.'” Id. (quoting Fla. Stat. § 48.193(2)). Specific jurisdiction “authorizes jurisdiction over causes of action arising from or related to the defendant's actions within Florida and concerns a nonresident defendant's contacts with Florida only as those contacts related to the plaintiff's cause of action.” Id. (citation omitted). Plaintiff alleges jurisdiction is proper under the Florida long-arm statute on two bases: (1) Defendants' “intentional and tortious acts within . . . Florida, ” and (2) Defendants' “substantial business [conducted] within . . . Florida related to the unlawful activity at issue.” (Doc. 17, pp. 1, 5-6; see also Doc. 9, ¶ 7.) The Court starts with Plaintiff's assertion of specific jurisdiction based on Defendants' alleged tortious acts within Florida.

         Florida's long-arm statute authorizes the exercise of specific personal jurisdiction where a claim arises from a defendant's commission of “a tortious act within [the] state.” Fla. Stat. § 48.193(1)(a)(2). “[A] defendant's physical presence is not necessary to commit a tortious act in Florida. Rather, ‘committing a tortious act in Florida . . . can occur through the nonresident defendant's telephonic, electronic, or written communications into Florida.'” Internet Sols. Corp. v. Marshall, 39 So.3d 1201, 1208 (Fla. 2010) (quoting Wendt v. Horowitz, 822 So.2d 1252, 1260 (Fla. 2002)). “However, the cause of action must arise from the communications.” Id. (quoting Wendt, 822 So.2d at 1260). Further, “[u]nder Florida law, a nonresident defendant commits ‘a tortious act within Florida' when he commits an act outside ...


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