The Snack Joint LLC v. OCM Grp. U.S., N.J.

THE SNACK JOINT LLC, Plaintiff, v. OCM GROUP USA, NJ, INC., OCM GLOBE INC., OCM GROUP USA INC., GANG WANG, YAOTIAN LI and XIAOHUI CHAI, “JOHN DOES” 1-5, Defendants.

No. 2:21-cv-00818 (BRM) (JSA)

United States District Court, D. New Jersey

September 8, 2021

NOT FOR PUBLICATION

OPINION

HON BRIAN R. MARTINOTTI United States District Judge

Before this Court is: (1) a Motion to Dismiss filed by Defendants OCM Group USA, NJ, Inc. (“OCM NJ”), OCM Globe Inc. (“OCM Globe”), OCM Group USA Inc. (“OCM USA”), Gang Wang (“Wang”) Yaotian Li (“Li”), and Xiaohui Chai (“Chai”) (collectively, “Defendants”) seeking to dismiss Plaintiff The Snack Joint LLC's (“Snack”) Complaint for lack of personal jurisdiction as to Li pursuant to Federal Rule of Civil Procedure 12(b)(2); (2) Defendants' Motion to Dismiss for improper venue pursuant to Federal Rule of Civil Procedure 12(b)(3); and (3) Defendants' Motion to Transfer Venue to the United States District Court for the Central District of California (the “Central District of California”) pursuant to 28 U.S.C. § 1404(a). (ECF No. 33.) Snack opposed Defendants' motions. (ECF No. 34.) Defendants filed a reply in support of their motions. (ECF No. 35.) Also before this Court is Snack's Motion for Preliminary Injunction. (ECF No. 36.) Defendants opposed Snack's motion. (ECF No. 37.) Snack filed a reply in support of its motion. (ECF No. 38.) Having reviewed the submissions filed in connection with the motions and having declined to hold oral argument pursuant to Federal Rule of Civil Procedure 78(b), for the reasons set forth below and for good cause appearing, Defendants' Motion to Dismiss for improper venue is DENIED, Defendants' Motion to Transfer Venue is GRANTED, and Defendants' Motion to Dismiss for lack of personal jurisdiction and Snack's Motion for Preliminary Injunction are DENIED as moot.

I. Background

Snack is in the food, beverage importation and wholesale business, selling beverages, condiments, and oil products across the U.S. (ECF No. 36-1 at 5.) One of Snack's products is a coconut juice product distributed under the trademark of YeShu federally registered in the U.S. (the “Asserted Mark”). (Id. at 5-6.) The Asserted Mark is owned by a Chinese company named Coconut Palm Group Limited (“Coconut Palm Group”). (Id. at 6.) Snack claims to have authorization from Coconut Palm Group to use the Asserted Mark exclusively and enforce it in the U.S. (Id.) Snack is incorporated and has its principal place of business in Brooklyn, New York. (ECF No. 1 ¶ 5.)

OCM Globe and OCM USA are in the food and beverage importation and distribution business. (ECF No. 33-1 at 5; ECF No. 37 at 7.) They imported from China and distributed in the U.S. certain coconut juice products (the “Accused Products”), which were manufactured by a Chinese company named Yeshu Group Co. Ltd. (“YeShu Group”). (ECF No. 37 at 7.) Defendants claim YeShu Group has authorized OCM Globe and OCM USA to sell and distribute the Accused Products in the U.S. (Id.) The Accused Products were sold under several trademarks that are owned by YeShu Group and officially registered in China (the “Accused Marks”).^[1] (Id. at 8.) OCM Globe and OCM USA are based in City of Industry, California (near Los Angeles). (ECF No. 33-1 at 5.) Their related company OCM N.J. is based in New Jersey.^[2] (Id.; ECF No. 33-4 ¶ 2.) Wang, the chief executive officer of OCM Globe and OCM USA, is an individual residing in Orange County, California (near Los Angeles). (ECF No. 33-1 at 6.) Li, an employee of OCM USA, is an individual residing in Chino, California (near Los Angeles). (Id.) Chai, the chief executive officer of OCM NJ, is an individual residing in Los Angeles County, California. (Id. at 7.)

Snack argues the Accused Marks are identical or closely similar to the Asserted Mark. (ECF No. 36-1 at 6.) Snack alleges Defendants have no association with Snack or Coconut Palm Group, and have no authorization from Snack or Coconut Palm Group to use the Accused Marks in the U.S. (Id.) Snack contends Defendants have infringed upon Snack and Coconut Palm Group's trademark rights. (Id. at 7.) On January 15, 2021, Snack filed a Complaint in this Court against Defendants for importing and distributing the Accused Products in the U.S. under the Accused Marks, asserting claims for: (1) trademark infringement under Section 32 of the Lanham Act, 15 U.S.C. § 1114 (Count 1); (2) unfair competition, false designation of origin and false description under Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a) (Count 2); (3) trademark infringement under New Jersey common law (Count 3); and (4) unfair competition under New Jersey common law (Count 4). (ECF No. 1.)

On June 1, 2021, Defendants filed: (1) a Motion to Dismiss for lack of personal jurisdiction as to Li pursuant to Federal Rule of Civil Procedure 12(b)(2); (2) a Motion to Dismiss for improper venue pursuant to Federal Rule of Civil Procedure 12(b)(3); and (3) a Motion to Transfer Venue to the Central District of California pursuant to 28 U.S.C. § 1404(a). (ECF No. 33.) On June 2, 2021, Snack opposed Defendants' motions. (ECF No. 34.) On June 2, 2021, Defendants filed a reply in support of their motions. (ECF No. 35.) On June 14, 2021, Snack filed a Motion for Preliminary Injunction to enjoin Defendants' allegedly infringing activities. (ECF No. 36.) On June 15, 2021, Defendants opposed Snack's motion. (ECF No. 37.) On June 15, 2021, Snack filed a reply in support of its motion. (ECF No. 38.)

II. Legal Standard

A. Motion to Dismiss for Improper Venue

“Federal Civil Rule of Procedure 12(b)(3) permits a court to dismiss a matter that is filed in an improper venue.” Wilson v. JPMorgan Chase, Civ. A. No. 18-13789, 2020 U.S. Dist. LEXIS 103695, at *3 (D.N.J. June 15, 2020). “[W]hen confronted with a motion to dismiss for improper venue, the [c]ourt may consider both the complaint and evidence outside the complaint.” Boston Sci. Corp. v. Cook Grp., Inc., 269 F.Supp.3d 229, 234 (D. Del. 2017) (citing 14D Wright & Miller, Federal Practice & Procedure § 3826 (4th ed. 2017)). “[T]he court accepts the allegations in the complaint as true unless they are contradicted by the defendant's affidavits.” Adams, Nash & Haskell, Inc. v. United States, Civ. A. No. 19-3529, 2020 U.S. Dist. LEXIS 47471, at *3 (D.N.J. Mar. 19, 2020) (citing Bockman v. First Am. Mktg. Corp., 459 Fed.Appx. 157, 158 n.1 (3d Cir. 2012)). The defendant “bear[s] the burden of showing improper venue.” Wilson, 2020 U.S. Dist. LEXIS 103695, at *4 (quotingMyers v. Am. DentalAss'n, 695 F.2d 716, 724-25 (3d Cir. 1982)). The proper venue for a civil action is:

(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; or

(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). “A district court has broad discretion when it comes to deciding whether to transfer or dismiss a case for . . . improper venue.” Konica Minolta, Inc. v. ICR Co., Civ. A. No. 15-1446, 2015 U.S. Dist. LEXIS 171277, at *13 (D.N.J. Dec. 22, 2015) (citing Cote v. Wadel, 796 F.2d 981, 985 (7th Cir. 1986)).

B. Motion to Transfer Venue

“A federal district court may transfer a civil action to a different venue under 28 U.S.C. § 1406(a) (‘Section 1406') or 28 U.S.C. § 1404(a) (‘Section 1404').” Bonavito v. President & Fellows of Harvard Coll., Civ. A. No. 20-14657, 2021 U.S. Dist. LEXIS 123146, at *11-12 (D.N.J. June 30, 2021). “To determine which provision applies, the court first ascertains whether venue is proper in the original forum.” Adams, 2020 U.S. Dist. LEXIS 47471, at *3 (citing Lafferty v. St. Riel, 495 F.3d 72, 78 (3d Cir. 2007)). “Section 1404(a) provides for the transfer of a case where both the original and the requested venue are proper.” Jumara v. State Farm Ins. Co., 55 F.3d 873, 878 (3d Cir. 1995). “Section 1406, on the other hand, applies where the original venue is improper and provides for either transfer or dismissal of the case.” Id.

Section 1404(a) states: “For the convenience of the parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought or to any district or division to which all parties have consented.” 28 U.S.C. § 1404(a). When a plaintiff has laid a proper venue, “[t]he decision whether to transfer falls in the sound discretion of the trial court.” Park Inn Int'l, L.L.C. v. Mody Enters., Inc., 105 F.Supp.2d 370, 377 (D.N.J. 2000). “[T]he burden of establishing the need for transfer . . . rests with the movant.” Jumara, 55 F.3d at 879.

The Court must consider three factors when determining whether to grant a transfer under § 1404(a): (1) the convenience of the parties; (2) the convenience of the witnesses; and (3) the interests of justice. Liggett Grp., Inc. v. R.J. Reynolds Tobacco Co., 102 F.Supp.2d 518, 526 (D.N.J. 2000) (citing 28 U.S.C. § 1404(a)). These factors are not exclusive and must be applied through a “flexible and individualized analysis . . . made on the unique facts presented in each case.” Id. at 527 (citations omitted). The first two factors have been refined into a non-exhaustive list of private and public interests that courts should consider. See Jumara, 55 F.3d at 879-80.

The private interests a court should consider include: (1) plaintiff's forum preference as manifested in the original...