GS Holistic LLC v. Vape Savvy LLC

Opinion

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3 4 5 6 7 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON 8 AT SEATTLE

9 10 GS HOLISTIC LLC, CASE NO. C23-0411JLR 11 Plaintiff, ORDER v. 12 VAPE SAVVY LLC, et al., 13 Defendants. 14

15 I. INTRODUCTION 16 Before the court is Defendants Vape Savvy LLC (“Vape Savvy”) and Jason 17 Stanifer’s (together, “Defendants”) motion to dismiss. (MTD (Dkt. # 21); Reply (Dkt. 18 # 24).) Plaintiff GS Holistic, LLC (“GS Holistic”) opposes the motion. (Resp. (Dkt. 19 # 22).) The court has reviewed the parties’ submissions, the relevant portions of the 20 // 21 // 22 // 1 record, and the governing law. Being fully advised,1 the court GRANTS Vape Savvy and 2 Mr. Stanifer’s motion to dismiss.

3 II. BACKGROUND 4 GS Holistic markets and sells products such as glass infusers that use the 5 “well-known trademark ‘Stündenglass.’” (Compl. (Dkt. # 1) ¶ 9.) It alleges that it is the 6 registered owner of several Stündenglass trademarks (the “Stündenglass Marks”), has 7 worked to distinguish the Stündenglass brand as “the premier manufacturer of glass 8 infusers,” and has devoted significant time, money, and resources to promoting and

9 protecting its trademarks. (Id. ¶¶ 4, 9-11, 16; see also id. ¶ 12 (listing the Stündenglass 10 Marks).) 11 GS Holistic alleges that Defendants Vape Savvy, Mr. Stanifer, Eric Ward, and 12 Todd Wilson2 sold counterfeit glass infusers bearing the Stündenglass Marks. (Id. 13 ¶¶ 26-29; see also id. ¶ 31 (describing its investigator’s purchase of a counterfeit glass

14 infuser from Vape Savvy’s store in Redmond, Washington).) It alleges Lanham Act 15 claims against Defendants for counterfeiting and trademark infringement under 15 U.S.C. 16 § 1114 and false designation of origin and unfair competition under 15 U.S.C. § 1125(a). 17 (Id. ¶¶ 53-70.) 18

19 1 Neither party requested oral argument (see MTD at 1; Resp. at 1) and the court finds 20 that oral argument would not be helpful to its disposition of the motion, see Local Rules W.D. Wash. LCR 7(b)(4).

21 2 GS Holistic voluntarily dismissed Mr. Wilson from this action on June 19, 2023. (See 6/19/23 Notice (Dkt. # 9).) The court dismissed Mr. Ward from this action on February 20, 22 2024, because GS Holistic had failed to effect timely service. (See 2/20/24 Order (Dkt. # 20).) 1 On March 13, 2023, GS Holistic filed a complaint in which it alleged that Vape 2 Savvy, Mr. Stanifer, Mr. Ward, and Mr. Wilson had infringed its trademarks by selling

3 counterfeit Stündenglass products in the Vape Savvy shop in Kirkland, Washington. (See 4 Compl., GS Holistic, LLC v. Vape Savvy LLC, No. C23-0373JLR (W.D. Wash. Mar. 13, 5 2023), Dkt. # 1 (hereinafter “C23-0373JLR”).) It filed the instant case against Vape 6 Savvy, Mr. Stanifer, Mr. Ward, and Mr. Wilson alleging sales of counterfeit products in 7 Vape Savvy’s Redmond shop on March 19, 2023. (See Compl.) Aside from a handful of 8 allegations regarding the locations of the stores, the cities in which the individual

9 defendants reside, and the purchases of allegedly counterfeit glass infusers, GS Holistic’s 10 complaint in C23-0373JLR is nearly identical to the complaint in this case.3 (Compare 11 id. ¶¶ 5-8, 31; with C23-0373JLR Compl. ¶¶ 5-8, 31.) The parties agree that the two 12 actions name the same defendants. (See MTD at 1-2 (explaining that Vape Savvy’s 13 stores in Redmond and Kirkland are owned and operated by the same company); Resp. at

14 3 (“[T]he Plaintiff does not oppose that the parties in this action and [C23-0373JLR] are 15 the same.”).) 16 The court granted GS Holistic’s motion for entry of default against Defendants in 17 this case on February 12, 2024. (2/12/24 Order (Dkt. # 14).) Vape Savvy, however, 18 answered GS Holistic’s complaint later that same day. (Answer (Dkt. # 15).) The court

19 subsequently granted the parties’ stipulated motion to set aside the entry of default. (See 20 2/14/24 Order (Dkt. # 19).) 21

3 GS Holistic filed nearly 50 trademark actions in this District in 2023. It has filed 22 hundreds of similar actions nationwide. 1 Defendants filed their motion to dismiss on March 31, 2024. (MTD.) Briefing on 2 the motion was completed on April 12, 2024. (See Resp.; Reply.) The motion is now

3 ripe for decision. 4 III. ANALYSIS 5 Defendants urge the court to dismiss this matter as duplicative of C23-0373JLR. 6 (MTD at 4-6.) In the alternative, if the court does not dismiss this matter as duplicative, 7 they argue that the court should dismiss GS Holistic’s claims against Mr. Stanifer for 8 failure to state a claim. (MTD at 6-10.) The court begins by setting forth the standard of

9 review and then considers Defendants’ motion to dismiss. 10 A. Standard of Review 11 Federal Rule of Civil Procedure 12(b)(6) provides for dismissal of a complaint for 12 “failure to state a claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). A 13 plaintiff’s complaint must “contain sufficient factual matter, accepted as true, to ‘state a

14 claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) 15 (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Although “detailed 16 factual allegations” are not required, the plaintiff must include more than “an unadorned, 17 the-defendant-unlawfully-harmed me accusation.” Id. (citing Twombly, 550 U.S. at 555) 18 (requiring the plaintiff to “plead[] factual content that allows the court to draw the

19 reasonable inference that the defendant is liable for the misconduct alleged”); see Fed. R. 20 Civ. P. 8(a). 21 // 22 // 1 B. Duplicative Actions 2 Defendants argue that this action should be dismissed in its entirety because it is

3 duplicative of C23-0373JLR. (MTD at 4-6.) GS Holistic counters that Defendants’ 4 motion must be denied because the two actions arise from separate transactions. (Resp. 5 at 2-5.) The court agrees with Defendants therefore grants their motion to dismiss. 6 Both parties cite Adams v. California Department of Health Services for the 7 standard for determining whether cases are duplicative. (See MTD at 4-6 (citing Adams 8 v. Cal. Dep’t of Health Servs., 487 F.3d 684, 688 (9th Cir. 2007), overruled on other

9 grounds by Taylor v. Sturgell, 553 U.S. 880 (2008)); Resp. at 2-5 (same).) That case 10 makes clear that “[p]laintiffs generally have ‘no right to maintain two separate actions 11 involving the same subject matter at the same time in the same court and against the same 12 defendant.’” Adams, 487 F.3d at 688 (quoting Walton v. Eaton Corp., 563 F.2d 66, 70 13 (3d Cir. 1977) (en banc)). “[I]n assessing whether the second action is duplicative of the

14 first, [the court] examine[s] whether the causes of action and relief sought, as well as the 15 parties or privies to the action, are the same.” Id. at 689. Here, there is no dispute that 16 the parties named in the two actions are the same. (See MTD at 1-2; Resp. at 3.) 17 Therefore, the court focuses its analysis on the causes of action and relief sought in the 18 two actions.

19 To determine whether the causes of action and relief are the same, courts in the 20 Ninth Circuit apply a “transaction test” that examines four factors: 21 (1) whether rights or interests established in the prior judgment would be destroyed or impaired by prosecution of the second action; (2) whether 22 substantially the same evidence is presented in the two actions; (3) whether 1 the two suits involve infringement of the same right; and (4) whether the two suits arise out of the same transactional nucleus of facts. 2 Adams, 487 F.3d at 689 (quoting Costantini v. Trans World Airlines, 681 F.2d 1199, 3 1201-02 (9th Cir. 1982)). Because the last factor is the “most important,” id., the court 4 addresses it first before considering the remaining factors. 5 GS Holistic argues that its two actions against Vape Savvy do not arise out of the 6 same transactional nucleus of facts because they involve two separate purchases of two 7 different products at two different Vape Savvy locations. (Resp. at 3-4.) The court, 8 however, agrees with Defendants that the “transactional nucleus” is broader than the two 9 sales. (See MTD at 5; Reply at 5.) “Whether two events are part of the same transaction 10 or series depends on whether they are related to the same set of facts and whether they 11 could conveniently be tried together.” Mpoyo v. Litton Electro-Optical Sys., 430 F.3d 12 985, 987 (9th Cir. 2005) (quoting Western Sys., Inc. v. Ulloa, 958 F.2d 864, 871 (9th Cir. 13 1992)). Here, both actions arise from alleged sales of counterfeit Stündenglass glass 14 infusers by the same set of defendants. The court concludes that the claims in this case 15 and in C23-0373JLR “form a convenient trial unit” that can be litigated jointly. See 16 Mpoyo, 430 F.3d at 987. Therefore, the fourth and most important factor of the 17 transaction test is satisfied. 18 The court also agrees with Defendants that the remaining factors favor finding that 19 the actions are duplicative. First, a final judgment in one case risks “destroy[ing] or 20 impair[ing]” a judgment in the other case because the key issue in both cases is whether 21 Vape Savvy violated GS Holistic’s trademark rights. Second, although evidence relating 22 1 to the two purchases will be different, evidence about GS Holistic’s trademarks and 2 Defendants’ procurement and sales of allegedly counterfeit products will likely be the

3 same in both actions. And finally, the two suits involve infringement of the same right. 4 because both arise from Defendants’ alleged infringement of the same set of trademarks. 5 Thus, because C23-0373JLR and this case involve the same parties and causes of action, 6 the court concludes that they are duplicative. 7 “After weighing the equities of the case, the district court may exercise its 8 discretion to dismiss a duplicative later-filed action, to stay that action pending resolution

9 of the previously filed action, to enjoin the parties from proceeding with it, or to 10 consolidate both actions.” Adams, 487 F.3d at 688 (citing Curtis v. Citibank, N.A., 226 11 F.3d 133, 138-39 (2d Cir. 2000)). “If an action is dismissed because of claim-splitting, 12 the dismissed party can still assert its claim through the remaining action against the same 13 defendants regarding the same issues.” Clayton v. District of Columbia, 36 F. Supp. 3d

14 91, 95 (D.D.C. 2014) (citing Katz v. Gerardi, 655 F.3d 1212, 1219 (10th Cir. 2011)); see 15 also id. at 96 (dismissing second lawsuit and holding that the first lawsuit, “amended to 16 include [plaintiff’s] additional claims, is the proper vehicle for airing the additional 17 claims”). Having weighed the equities, the court concludes that the appropriate remedy 18 is to dismiss this action without prejudice to GS Holistic pursuing its claims based on the

19 sale of allegedly counterfeit glass infusers at Vape Savvy’s Redmond shop in 20 C23-0373JLR. Accordingly, the court GRANTS Defendants’ motion to dismiss. 21 Because the court dismisses this matter as duplicative of C23-0373JLR, it need not 22 consider Defendants’ motion in the alternative to dismiss GS Holistic’s claims against 1 Mr. Stanifer for failure to state a claim. (See MTD at 6-10.) The court notes, however, 2 that it denied a nearly identical motion to dismiss GS Holistic’s claims against Mr.

3 Stanifer and Mr. Ward in C23-0373JLR. (See 4/19/24 Order (C23-0373JLR Dkt. # 32) at 4 4-8.) 5 IV. CONCLUSION 6 For the foregoing reasons, the court GRANTS Defendants’ motion to dismiss 7 (Dkt. # 21) without prejudice to GS Holistic pursuing its claims against Vape Savvy and 8 Jason Stanifer in C23-0373JLR.

9 Dated this 22nd day of April, 2024. 10 A 11 12 JAMES L. ROBART United States District Judge

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