Yeti Coolers, LLC v. Love Deals Inc.

CourtDistrict Court, W.D. Texas
DecidedJuly 24, 2023
Docket1:23-cv-00079
StatusUnknown

This text of Yeti Coolers, LLC v. Love Deals Inc. (Yeti Coolers, LLC v. Love Deals Inc.) is published on Counsel Stack Legal Research, covering District Court, W.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Yeti Coolers, LLC v. Love Deals Inc., (W.D. Tex. 2023).

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF TEXAS AUSTIN DIVISION

YETI COOLERS, LLC, § § Plaintiff, § § v. § 1:23-CV-79-RP § LOVE DEALS INC. and ENDLISS § TECHNOLOGY INC., § § Defendants. §

ORDER

Before the Court is Defendants Love Deals Inc. (“Love Deals”) and Endliss Technology Inc.’s (“Endliss”) (collectively, “Defendants”) Motion to Dismiss or Transfer in the Alternative, (Dkt. 14), and Plaintiff Yeti Coolers, LLC’s (“Yeti”) motion for leave to file a surreply, (Dkt. 27). Having considered the parties’ briefs, the record, and the relevant law, the Court will deny the motion to dismiss and grant the motion for leave. I. BACKGROUND Yeti is a Delaware company with its principal place of business in Austin, Texas. (Compl., Dkt. 1, at 2). Yeti designs, develops, and manufactures drinkware products, including its trademarked “Rambler Tumblers.” (Id. at 4). It owns trade dress rights in the design and appearance of these 20oz and 30oz tumblers and has continuously and extensively marketed and sold these tumblers across the country, including in Texas. (Id.). Defendants are two sister corporations with their principal place of business in Hayward, California. (Id. at 2). According to the complaint, Defendants sell drinkware products online, including a 20oz Tumbler and a 30oz Tumbler. (Id. at 8–9). They promote, advertise, offer to sell, and manufacture or distribute these tumblers in the United States. (Id.). On January 25, 2023, Yeti brought suit against Defendants, alleging that they are marketing, promoting, selling, and distributing tumblers that violate Yeti’s trade dress rights. (Id. at 7–8). Yeti alleges that these drinkware products are “confusingly similar imitations” of their own tumblers and sold without Yeti’s consent. (Id.). Yeti’s causes of action include trade dress infringement, trade dress dilution, and unfair competition and false designation of origin, all under 15 U.S.C. § 1125. (Id. at 14–19).

On April 21, 2023, Defendants jointly moved to dismiss Yeti’s complaint for lack of personal jurisdiction and improper venue. (Mot. Dismiss, Dkt. 14). In their motion, Defendants argue that they lack sufficient connections with Texas to establish specific jurisdiction in the state. (Id.). Because neither company is incorporated in Texas nor has its principal place of business in the state, Defendants also contest general jurisdiction. (Id.). In support of their motion, Defendants rely principally on the declaration of Sen Cai, the Chief Financial Officer of Endliss. (Cai Decl., Dkt. 14- 1). Although the two Defendants are sister companies, their product sales and distribution appear to vary slightly. As to Endliss, Defendants allege the following facts: Endliss does not have a Texas taxpayer number. (Id. at 3). Endliss has no business presence in Texas. (Id. at 5). Endliss’ marketing and sales of the infringing tumblers occur exclusively through its storefront on Amazon.com, and the company does not sell products of any kind directly to consumers. (Id. at 5–

6). While Endliss does maintain its own website, atlinsport.com, that site does not sell its products, and instead refers interested purchasers to the company’s Amazon storefront. (Id.). As to Love Deals, Defendants admit that the company does have a Texas taxpayer number. (Id. at 10). Like Endliss, however, Love Deals has no physical business presence in the state. (Id.). Love Deals does not market or sell the infringing tumblers (or other products) directly to Texas residents. (Id. at 11). In fact, Love Deals contends that it “simply does not advertise or sell the Accused Tumblers” and that it “has not sold products” to Texas retailers. (Id.). Yeti strongly disputes these statements, and instead accuses Defendants of downplaying and hiding their sales in Texas. (Pl.’s Resp., Dkt. 19, at 1). According to Yeti, Endliss sells the infringing tumblers on a different website also owned by the company, “us.maxboostpower.com” which has an option select shipping to Texas (and was not mentioned in their motion to dismiss). (Id. at 3).

Love Deals, meanwhile, promotes the infringing tumblers though its website, trianium.com, and directs consumers to buy the products on its Amazon page. (Id. at 4). Yeti further alleges that both Defendants have registered to do business in Texas and that Love Deals has a Registered Agent with a Registered Office in Austin. (Id. at 6).1 Yeti argues that the sales of its tumblers through Amazon and the companies’ own websites are sufficient to establish specific jurisdiction in the state. (Id. at 8– 12). The Court held a hearing on the motion on July 18, 2023. (Minute Entry, Dkt. 32). At the hearing, the parties contested whether Endliss has a Texas taxpayer number and whether the website us.maxboostpower.com sells the infringing products. (Id.). The Court adjourned the hearing, noting that personal jurisdiction would exist even if Defendants’ contested factual allegations were taken as true and that any remaining factual disputes could be resolved during discovery. (Id.). II. LEGAL STANDARDS

A. Motion to Dismiss for Lack of Personal Jurisdiction The Federal Rules of Civil Procedure allow a defendant to assert lack of personal jurisdiction as a defense to suit. Fed. R. Civ. P. 12(b)(2). On such a motion, “the plaintiff bears the burden of establishing the district court’s jurisdiction over the nonresident.” Stuart v. Spademan, 772 F.2d 1185,

1 In their reply brief, Defendants do not dispute that Endliss does have a Texas taxpayer number. (Defs.’ Reply, Dkt. 25). At the Court’s hearing, however, counsel for Endliss stated that it does not have a taxpayer number. (Minute Entry, Dkt. 32). 1192 (5th Cir. 1985). The court may determine the jurisdictional issue “by receiving affidavits, interrogatories, depositions, oral testimony, or any combination of the recognized methods of discovery.” Id. But when, as here, the Court rules on the motion without an evidentiary hearing,2 the plaintiff need only present a prima facie case that personal jurisdiction is proper; proof by a preponderance of the evidence is not required. Walk Haydel & Assocs., Inc. v. Coastal Power Prod. Co.,

517 F.3d 235, 241 (5th Cir. 2008). Uncontroverted allegations in a plaintiff’s complaint must be taken as true, and conflicts between the facts contained in the parties’ affidavits must be resolved in the plaintiff’s favor. Id. Nevertheless, a court need not credit conclusory allegations, even if uncontroverted. Panda Brandywine Corp. v. Potomac Elec. Power Co., 253 F.3d 865, 869 (5th Cir. 2001) (per curiam). B. Motion to Transfer Section 1404 provides that “[f]or the convenience of 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.” 28 U.S.C. § 1404(a). As such, “[t]he threshold question in applying the provisions of § 1404(a) is whether the suit could have been brought in the proposed transferee district.” In re Volkswagen AG, 371 F.3d 201, 203 (5th Cir. 2004) (“Volkswagen I”).

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Yeti Coolers, LLC v. Love Deals Inc., Counsel Stack Legal Research, https://law.counselstack.com/opinion/yeti-coolers-llc-v-love-deals-inc-txwd-2023.