Detroit Coffee Company, LLC v. Soup For You, LLC
2:18-cv-10688
| E.D. Mich. | Feb 28, 2018Background
- Plaintiff Detroit Coffee Company, LLC is a Michigan LLC with its principal place of business in New York City; it owns a registered DETROIT COFFEE trademark used nationally since 2013.
- Defendants are Soup for You, LLC (doing business as Detroit Bold Coffee Co.), a Michigan LLC with principal place of business in Michigan, and its sole owner Allen James O’Neil, a Michigan resident.
- Detroit Bold sells coffee under marks including DETROIT BOLD; most sales (≈95%) occur in Michigan and the remainder via online sales; only 21 sales went to New York state (very few to this district).
- Detroit Coffee sued for trademark infringement in the Southern District of New York; defendants moved to dismiss or transfer for improper venue and sought dismissal for lack of personal jurisdiction over O’Neil.
- The court evaluated venue under 28 U.S.C. § 1391(b), considering whether a substantial part of the events giving rise to the claim occurred in the Southern District of New York (via substantial sales or intentional targeting).
- The court found the small number of sales into New York and the existence of a passive online storefront insufficient to establish that a substantial part of the alleged infringement occurred in this district, and ordered transfer to the Eastern District of Michigan.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether venue is proper in SDNY under § 1391(b) because a substantial part of events occurred there | Detroit Coffee contends infringement (consumer confusion) occurred in SDNY and venue is therefore proper | Defendants argue most conduct and sales occurred in Michigan; online availability alone does not show substantial events in SDNY | Venue in SDNY is not proper; insufficient sales/targeting to show a substantial part of events occurred here |
| Whether online sales/website alone constitute targeting sufficient for venue | Plaintiff argues Detroit Bold’s website and Amazon storefront made products available to NY consumers, supporting venue | Defendants say website is passive and they did not specifically market, advertise, or maintain presence in SDNY | A passive website without other targeted marketing does not establish venue in SDNY |
| Whether substantial sales to SDNY occurred to satisfy venue | Plaintiff points to online orders into New York as evidence of sales in the district | Defendants show 99.9% of sales occurred outside SDNY; only 21 sales to NY state; negligible in this district | Sales to SDNY were de minimis and not a "substantial part" for venue purposes |
| Whether case should be dismissed or transferred when venue is improper | Plaintiff did not specifically oppose transfer; sought to proceed in SDNY | Defendants requested transfer to Eastern District of Michigan where venue is proper | Court transferred the action to the Eastern District of Michigan and denied personal jurisdiction motion as moot |
Key Cases Cited
- Gulf Ins. Co. v. Glasbrenner, 417 F.3d 353 (2d Cir. 2005) (prima facie showing suffices on venue challenge absent an evidentiary hearing; interpret "substantial part" strictly)
- CutCo Indus. v. Naughton, 806 F.2d 361 (2d Cir. 1986) (plaintiff need only make a prima facie showing of venue)
- Leroy v. Great W. United Corp., 443 U.S. 173 (1979) (courts may address venue before personal jurisdiction for prudential reasons)
- Pilates, Inc. v. Pilates Inst., 891 F. Supp. 175 (S.D.N.Y. 1995) (venue in trademark cases proper where consumer confusion is alleged to occur)
- D'Anton Jos, S.L. v. Doll Factory, Inc., 937 F. Supp. 320 (S.D.N.Y. 1996) (venue may be proper where defendant targets district via advertising or makes substantial sales there)
- Hsin Ten Enter. USA, Inc. v. Clark Enters., 138 F. Supp. 2d 449 (S.D.N.Y. 2001) (a passive website alone does not automatically establish venue in every district)