Hazelden Betty Ford Found. v. My Way Betty Ford Klinik, GmbH, CIVIL 20-409 (JRT/TNL)

HAZELDEN BETTY FORD FOUNDATION and ELIZABETH B. FORD CHARITABLE TRUST, Plaintiffs, v. MY WAY BETTY FORD KLINIK, GmbH Defendant.

CIVIL No. 20-409 (JRT/TNL)

United States District Court, D. Minnesota

August 20, 2021

Laura L. Myers and Nirmani Chethana Perera, FREDRIKSON & BYRON PA, 200 South Sixth Street, Suite 4000 Minneapolis, MN 55402, for plaintiffs.

Alan M. Anderson and L. Reagan Florence, ALAN ANDERSON LAW FIRM LLC, 11100 Wayzata Boulevard, Suite 545 Minneapolis, MN 55305, for defendant.

MEMORANDUM OPINION AND ORDER

JOHN R. TUNHEIM, CHIEF JUDGE UNITED STATES DISTRICT COURT

Plaintiffs Hazelden Betty Ford Foundation (“Hazelden”) and the Elizabeth B. Ford Charitable Trust (the “Betty Ford Trust”) brought an action against Defendant My Way Betty Ford Klinik GmbH (“MWBF Klinik”) for statutory and common law trademark infringement, unfair competition, false advertising, cybersquatting, and infringement of the right to publicity under California law. On December 1, 2020, the Court issued an order denying MWBF Klinik's motion to dismiss for lack of personal jurisdiction. MWBF Klinik then filed a Motion for Certification for Interlocutory Appeal pursuant to 28 U.S.C § 1292(b). Because MWBF Klinik has not demonstrated that the order raises a controlling question of law warranting immediate appeal, the Court will deny the Motion for Certification.

MWBF Klinik also filed a Motion for Judgment on the Pleadings pursuant to Federal Rules of Civil Procedure 12(c), or in the alternative, for Summary Judgment. Because the Court finds that Plaintiffs plausibly plead claims for which relief may be granted, the Court will deny MWBF Klinik's Motion for Judgment on the Pleadings. Additionally, because discovery has not yet commenced and Plaintiffs have not yet had the opportunity to develop the factual record to support their claims, the Court finds that summary judgment would be premature at this time and will deny MWBF Klinik's alternative Motion for Summary Judgment.

BACKGROUND

I. FACTUAL BACKGROUND

The facts of this matter were documented in detail in the Court's prior order. See Hazelden Betty Ford Found. v. My Way Betty Ford Klinik GmbH, 504 F.Supp.3d 966, 97073 (D. Minn. 2020). As relevant here, Plaintiffs operate drug and alcohol treatment programs across the United States and hold exclusive rights to the use and licensing of the Betty Ford Marks, which are associated with Plaintiffs' distinct treatment model. (Am. Compl. ¶¶ 1-2, 10-16, 18, Feb. 5, 2020, Docket No. 6.) MWBF Klinik is a German entity that operates a drug and alcohol treatment facility in Bad Bruckenau, Germany. (Id. ¶ 5.) In 2012, MWBF Klinik contacted the Betty Ford Center (“BFC”) to propose a cooperative business relationship. (Id. ¶ 21.)

Over the course of the next two years, MWBF Klinik representatives visited BFC in California and engaged in email and phone communications with Plaintiffs regarding MWBF Klinik's interest in forming a business relationship. (Id. ¶¶ 22-34.) MWBF Klinik claimed that a cooperative business arrangement would provide legal cover for MWBF Klinik's continued use of the Betty Ford marks in Germany and would advance Plaintiffs' intellectual property and business interests in Europe and the Middle East. (Id. ¶¶ 24, 29, 31; Myers Decl. ¶ 4, Ex. C at 16, Aug. 24, 2020, Docket No. 25-1.) Throughout these discussions, MWBF Klinik represented that it would adopt another name and cease its use of “Betty Ford” if the parties could not come to an agreement. (Am. Compl. ¶ 31.)

In April of 2014, MWBF Klinik representatives traveled to Minnesota to meet with Hazelden; Hazelden informed MWBF Klinik in writing at that meeting that it would not provide a license to use the Betty Ford name and that it relied on MWBF Klinik's prior assurances that it would change its name and cease using references to “Betty Ford” by July 1, 2015. (Id. ¶¶ 35-37.)

MWBF Klinik has continued to use the “Betty Ford” name, including on its website. (Id. ¶¶ 38-39.) As a result, Plaintiffs allege that MWBF Klinik has misrepresented its affiliation with Plaintiffs in promoting its services. (Id. ¶¶ 40-44.) Plaintiffs also aver that they have received communications at their offices in the United States from prospective patients, MWBF Klinik patients, and the contacts of MWBF Klinik patients expressing confusion about the relationship between the entities, and have documented other instances of actual confusion among consumers in the United States and abroad. (Id. ¶¶ 45-48; see also 2^nd Decl. Laura L. Meyers ¶¶ 4-6, 9-13, Feb. 2, 2021, Docket No. 64.)

II. PROCEDURAL BACKGROUND

On January 30, 2020, Plaintiffs filed suit against Defendant MWBF Klinik in the District of Minnesota. (Compl., Jan. 30, 2020, Docket No 1.) Plaintiffs filed an Amended Complaint on February 5, 2020, alleging six counts for trademark infringement under 15 U.S.C. § 1114, unfair competition under 15 U.S.C. § 1125(a), false advertising under 15 U.S.C. § 1125(b), common law trademark infringement, cybersquatting in violation of 15 U.S.C. § 1125(d), and right of publicity infringement pursuant to California Civil Code § 3344.1. (Am. Compl. ¶¶ 52-134.)

On August 3, 2020, MWBF Klinik filed a motion to dismiss for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2). (Mot. Dismiss, Aug. 3, 2020, Docket No. 15.) The Court denied the motion, finding that personal jurisdiction existed pursuant to Rule 4(k)(2). Hazelden, 504 F.Supp.3d at 978. MWBF Klinik then filed a Motion to Certify Interlocutory Appeal. (Mot. Certify Interlocutory Appeal Dec. 28, 2020, Docket No 42.)

MWBF Klinik subsequently filed a Motion for Judgment on the Pleadings, or, in the alternative, for Summary Judgment. (Mot. J. Pleadings, Jan. 12, 2021, Docket No. 57.) Plaintiffs oppose both Motions.

DISCUSSION

I. MOTION TO CERTIFY INTERLOCUTORY APPEAL

MWBF Klinik asks the Court to certify two questions for interlocutory appeal: which party bears the burden of proving the non-existence of jurisdiction in any other forum in the United States under Federal Rule of Civil Procedure 4(k)(2); and whether personal jurisdiction over MWBF Klinik as a foreign defendant is proper under Rule 4(k)(2). MWBF Klinik argues that the court's application of Rule 4(k)(2) is a question of law that has not been settled by the Eighth Circuit and asks the court to stay proceedings pending an interlocutory appeal.

A. Standard of Review

Section 1292(b) creates a narrow exception to the final judgment rule and allows district courts to certify orders for interlocutory appeal if certain criteria are satisfied and the district court determines that certification is appropriate. 28 U.S.C. § 1292(b); see also White v. Nix, 43 F.3d 374, 377 (8^th Cir. 1994). To certify a question for interlocutory appeal, the district court must determine that the order “involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation[.]” 28 U.S.C. § 1292(b).

Although district courts have discretion to certify an order for an immediate interlocutory appeal, it has “long been the policy of the courts to discourage piece-meal appeals because most often such appeals result in additional burdens on both the court and the litigants.” White, 43 F.3d at 376 (quotation omitted). Further, the statute's legislative history indicates that it was to be used only in extraordinary cases where a decision on interlocutory appeal might avoid protracted and expensive litigation. Id. For these reasons, a motion for certification of interlocutory appeal “must be granted sparingly, and the movant bears the heavy burden of demonstrating that the case is an exceptional one in which immediate appeal is warranted.” Id.

B. Analysis

A question of law is “controlling” if “reversal of the district court's order would terminate the action, ” or even “if its resolution is quite likely to affect the further course of the litigation.” Nat' Union Fire Ins. Co. of Pittsburgh v. Donaldson Co., Inc., No. 104948, 2015 WL 4898662, at *2 (D. Minn. Aug. 17, 2015). Here, MWBF Klinik merely challenges the application of settled law-the jurisdictional scope of Rule 4(k)(2)-to a specific set of facts-the quality, quantity, and timeline of MWBF Klinik's contacts with the United States. The application of law to facts, however, does not present the type of purely legal question that is appropriate for certification under § 1292. See Great Lakes Gas Transmission Ltd. P'ship v. Essar Steel Minn., LLC, No. 09-3037, 2013 WL 4028144, at *4 (D. Minn. Aug. 7, 2013); see also Nat' Union, 2015 WL 4898662, at *3-4.

Second, MWBF Klinik's argument regarding whether substantial grounds for difference of opinion exist focuses almost entirely on potential differences of opinion regarding the Court's application of law to the facts of the case, not on the Court's legal interpretation of Rule 4(k)(2).^[1] MWBF Klinik has therefore not demonstrated that there are a sufficient number of conflicting and contradictory opinions on a controlling question of law.^[2]

Finally MWBF Klinik's argument that certification would materially advance the ultimate termination of the litigation is premised on an assumption that the Eighth Circuit would find jurisdiction improper and dismiss the action. However, given that MWBF Klinik has not identified any substantial ground for difference of opinion as to the Court's legal interpretation of Rule 4(k)(2), there is at least an equal or greater possibility that certification would unduly delay termination of the litigation by stalling the proceedings. See White, 43 F.3d at 378 (“certification is proper only when it will materially...