Strobel v. Rusch

364 F. Supp. 3d 1270
CourtDistrict Court, D. New Mexico
DecidedFebruary 1, 2019
DocketNo. CIV 18-0656 RB/KBM
StatusPublished
Cited by6 cases

This text of 364 F. Supp. 3d 1270 (Strobel v. Rusch) is published on Counsel Stack Legal Research, covering District Court, D. New Mexico primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Strobel v. Rusch, 364 F. Supp. 3d 1270 (D.N.M. 2019).

Opinion

ROBERT C. BRACK, SENIOR U.S. DISTRICT JUDGE

This matter is before the Court on the Motion to Dismiss of Defendants Uwe Rusch and Mabel Rusch Pursuant to Fed. R. Civ. P. 12(b)(2) and Fed. R. Civ. P. 12(b)(3), filed on August 13, 2018. (Doc. 7.) Having considered the motion, briefs, attached documents, and relevant law, the Court finds that the motion should be denied.

In 2012, Defendant Uwe Rusch (Mr. Rusch) was the sole owner and member of a Florida limited liability company called UNC-FL. In furtherance of this business, Mr. Rusch's wife, Defendant Dr. Mabel Rusch (Dr. Rusch), registered a trademark in her name. In 2013, Plaintiffs entered into an agreement with Defendants to become part owners of UNC-FL, and Plaintiff Volker Strobel (Mr. Strobel) took an active role in advancing the Florida business. Soon thereafter, the parties became concerned about Florida's regulatory framework and decided to dissolve UNC-FL and re-establish the business in New Mexico under the name UNC-NM. Mr. Strobel and Mr. Rusch were managers of UNC-NM. In 2015, Mr. Strobel announced to the parties that the business was struggling and in need of capital. Thereafter, Defendants took actions that violated the parties' agreement. Plaintiffs now bring suit for a variety of tort and contract claims. Defendants argue that neither jurisdiction nor venue is proper in New Mexico.

I. Factual Background1

Defendants are residents of Florida. (Doc. 1 (Compl.) at 1 & ¶¶ 5-6.) In 2012 Mr. Rusch formed UNC-FL, a limited liability company created to produce and sell cordials (a type of after-dinner drink). (Id. ¶ 11.) Years before, Defendants had organized a business in Germany and registered the trademark CORDIALS V.I.P. DRINKS (the "V.I.P. Mark" or the "trademark"). (Id. ¶¶ 12-13.) After forming UNC-FL, Defendants transferred registration of the trademark from the German company to Dr. Rusch in her own name. (Id. ¶ 13.)

Mr. Strobel and Plaintiff Heike Strobel (Mrs. Strobel) are residents of New Mexico. (Id. at 1 & ¶¶ 1-2.) The Strobels met Defendants while vacationing in Florida in 2012. (Id. ¶ 14.) Defendants told the Strobels "about the business of UNC-FL and invited them to invest in UNC-FL's business...." (Id. ; see also Doc. 18-1 ¶ 6.) At that time, "Mr. Rusch was the sole record owner and member of UNC-FL...." (Compl. ¶ 11; see also Doc. 18-6 at 1.) After the Strobels returned to New Mexico, Mr. Rusch began to email and call Mr. Strobel to encourage him to invest in the business. (Doc. 18-1 ¶ 7.) Mr. Rusch visited New Mexico in "April 2012 to discuss several business opportunities, one of which involved the cordials business...." (Id. ¶ 8.)

*1277In June 2012, both Mr. and Dr. Rusch visited New Mexico to speak with Mr. and Mrs. Strobel about investing in the cordials business. (Id. ¶¶ 10-11.) During this visit, Dr. Rusch stated that she would transfer registration of the V.I.P. Mark from her name to UNC-FL. (Id. ¶ 11.) Dr. Rusch's consent to transfer registration of the trademark is memorialized in the parties' Partnership Agreement. (See Doc. 18-6 at 2 ("Mrs. Mabel Rusch hereby undertakes to convey to the Holding all rights to the CORDIALS trademark and all rights to the design and logos of CORDIALS products.... The transfer of ownership of these rights will be initiated after the signing of this agreement." The transfer is "part of the package of CORDIALS rights that Mr. and Mrs. Rusch are contributing to the Holding.").) She also told Plaintiffs that Mr. Rusch "had authority to speak for her with respect to her ownership of the trademark and participation in the business." (Doc. 18-1 ¶ 11.)

Mr. Rusch, Mr. Strobel, and Plaintiff Hans Baur (Mr. Baur) met in Arizona in early 2013 to discuss the terms of Plaintiffs' investment in UNC-FL. (Id. ¶ 12.) Thereafter, Mr. and Dr. Rusch, Mr. and Mrs. Strobel, Mr. Baur, and another individual who is not a party to this lawsuit, entered into an agreement to invest in UNC-FL. (Id. ; Compl. ¶ 15.) Over the next year, Mr. Strobel often traveled to Florida to help Mr. Rusch develop the business. (Doc. 18-1 ¶ 13.)

The parties soon became concerned that Florida's "regulatory climate was not favorable for the development and operation of" UNC-FL; therefore, they decided to dissolve the business in Florida and reestablish it in New Mexico. (Id. ; Compl. ¶ 18.) In 2014, Mr. Rusch formally terminated UNC-FL, and Mr. Strobel formed UNC-NM-a continuation of the cordials business-in New Mexico. (Doc. 18-1 ¶ 14.) Both Mr. Strobel and Mr. Rusch were managers of UNC-NM, and Mr. Rusch continued to communicate with Mr. Strobel via phone and email to manage the business. (Id. ¶¶ 14, 16.) The business utilized a certified public accountant (CPA) located in New Mexico, who "had been preparing tax returns for UNC-FL ... since 2013, both before and after the" company relocated to New Mexico. (Id. ¶ 16.)

Approximately one year later, Mr. Strobel told the other parties that UNC-NM needed new capital or the business would fail. (Compl. ¶ 20.) Defendants then ceased communicating with Plaintiffs about the business. (Id. ) Plaintiffs learned that Dr. Rusch had transferred registration of the trademark to UNC-NM, but had later transferred it back to her own name without informing Plaintiffs.2 (See Doc. 18-1 ¶ 15; see also Doc. 18-1, Ex. 11.) Plaintiffs also discovered that, since learning that UNC-NM was failing, Defendants "have sought investment or business opportunities from others, based on the representation that [Dr. Rusch] owned the V.I.P. Mark and they owned the beverage business associated with the V.I.P. Mark." (Compl. ¶ 21.) Plaintiffs assert that Defendants' actions have infringed upon UNC-NM's rights in the trademark and caused damage to Plaintiffs. (Id. ) Plaintiffs filed suit against Defendants in this Court in July 2018. (See Compl.) Defendants now move to dismiss for lack of personal jurisdiction and venue. (See Doc. 7.)

*1278II. Legal Standard

"Motions to dismiss brought under Federal Rule of Civil Procedure 12(b)(2) test a plaintiff's theory of personal jurisdiction as well as the facts supporting personal jurisdiction.... When a defendant challenges the court's jurisdiction, the plaintiff bears the burden of demonstrating that jurisdiction exists." Davis v. USA Nutra Labs , No. CV 15-01107 MV/SCY, 2016 WL 9774945, at *3 (D.N.M. Dec. 21, 2016) (citing McNutt v. Gen. Motors Acceptance Corp. , 298 U.S. 178, 189, 56 S.Ct. 780

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Bluebook (online)
364 F. Supp. 3d 1270, Counsel Stack Legal Research, https://law.counselstack.com/opinion/strobel-v-rusch-nmd-2019.