978 F. Supp. 2d 1275
N.D. Ga.2013Background
- Plaintiffs RMS Titanic, Inc. and Premier Exhibitions (Georgia/Florida) allege former employee Thomas Zaller and corporate affiliates misused Plaintiffs’ proprietary Titanic exhibition materials to mount a competing exhibit in Macau and marketed it in the U.S.
- Plaintiffs allege Zaller obtained CAD plans, photographs, narratives, videos, and other materials after assurances and contractual representations in connection with staging a Singapore exhibition, then used those materials for the Macau exhibit.
- Claims in the amended complaint: conversion, breach of contract, unjust enrichment, fraud/fraudulent inducement, Lanham Act trade dress infringement, misappropriation of trade secrets (GTSA), and piercing the corporate veil against several corporate defendants (U.S. and foreign).
- Defendants moved to dismiss under Rules 12(b)(1), (2), (3), and (6), arguing lack of subject-matter jurisdiction over Lanham Act claims (extraterritoriality), lack of personal jurisdiction over non-Georgia defendants, preemption (copyright and GTSA), failure to plead claims, and improper venue.
- The Court found federal-question jurisdiction exists over Lanham Act claims as to U.S. defendants (Bulova/McBee framework) but not over the Singapore corporate defendant (insufficient substantial effect on U.S. commerce); dismissed that foreign defendant.
- The Court denied dismissal of Plaintiffs’ trade dress, breach of contract, fraud, and trade-secret claims against the remaining U.S. defendants, but dismissed conversion and unjust enrichment claims to the extent they overlap with copyright/GTSA and dismissed the corporate‑veil count for failure to plead alter-ego facts; limited jurisdictional discovery on the Nevada corporate defendant was allowed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Subject-matter jurisdiction over Lanham Act claims (extraterritorial application) | U.S. defendants’ conduct (marketing in U.S., trade shows, website) supports extraterritorial application and federal jurisdiction | Acts occurred abroad (acquisition in Singapore, misuse in Macau) so Lanham Act cannot reach foreign conduct for foreign defendant | Jurisdiction exists over U.S. defendants (Bulova/McBee): U.S. citizen defendants and U.S.-directed marketing support jurisdiction; no jurisdiction over Imagine‑Singapore (no substantial effect on U.S. commerce) |
| Sufficiency of trade dress claim under Lanham Act | Plaintiffs pleaded distinct, nonfunctional exhibition elements and alleged consumer confusion from U.S. marketing | Defendants: elements are functional/scene‑of‑the‑crime similarities; no overlapping markets so no confusion | Trade dress claim adequately pleaded as plausible; motion to dismiss denied for remaining defendants |
| Conversion claim preempted by Copyright Act | Plaintiffs seek recovery for converted tangible and intangible materials (CDs, flash drives, plans, photos) | Defendants: allegations concern copyrightable subject matter; §301 preempts state law equivalents | Conversion claim for intangible/copyrightable materials preempted and dismissed; tangible conversion not sufficiently pleaded (dismissed without prejudice to amendment if discovery supports) |
| GTSA preemption of unjust enrichment/fraud claims | Plaintiffs concede GTSA supersedes overlapping torts for trade‑secret misappropriation but preserve fraud claims | Defendants: GTSA supersedes conversion, unjust enrichment, fraud theories tied to misappropriation | Unjust enrichment (as to intangible/trade‑secret material) dismissed as superseded by GTSA; fraud/fraudulent inducement survives (fraud can be independent remedy) |
| Breach of contract (oral confidentiality agreement) | Plaintiffs allege negotiations, promises to keep materials confidential, and that disclosures were made in reliance | Defendants: oral agreement insufficient, statute of frauds bars multi‑year confidentiality | Court finds allegations plausible that oral agreement existed and could be performed within a year; breach claim survives |
| Personal jurisdiction over foreign/nonresident corporate defendants | Plaintiffs assert corporations are alter egos of Zaller and have Georgia contacts (admin/accounting in Atlanta, marketing at U.S. trade shows) | Defendants: limited Atlanta activities insufficient; alter‑ego theory cannot transfer Zaller’s contacts to separate foreign entities | Reverse alter‑ego theory rejected; alter‑ego allegations are conclusory and insufficient; court grants limited jurisdictional discovery as to Imagine‑Nevada; Imagine‑Singapore dismissed on separate grounds |
| Venue | Plaintiffs and several defendants are Georgia citizens; significant events tied to Georgia | Defendants argued improper venue | Venue in Northern District of Georgia is proper as to Georgia parties and under §1391(3) for remaining defendants |
Key Cases Cited
- Steele v. Bulova Watch Co., 344 U.S. 280 (Sup. Ct.) (permitting extraterritorial application of Lanham Act against U.S. citizen for foreign acts)
- Vanity Fair Mills, Inc. v. T. Eaton Co., 234 F.2d 633 (2d Cir.) (factors for extraterritorial application: U.S. defendant, no conflict with foreign law, substantial effect on U.S. commerce)
- Int’l Café, S.A.L. v. Hard Rock Café Int’l, 252 F.3d 1274 (11th Cir.) (applying Bulova/Vanity Fair principles re: extraterritoriality)
- McBee v. Delica Co., Ltd., 417 F.3d 107 (1st Cir.) (analytical framework for extraterritorial Lanham Act jurisdiction emphasizing defendant’s U.S. citizenship or substantial effects test)
- Dippin’ Dots, Inc. v. Frosty Bites Distrib., LLC, 369 F.3d 1197 (11th Cir.) (elements of trade dress claim)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (Sup. Ct.) (plausibility pleading standard)
- Ashcroft v. Iqbal, 556 U.S. 662 (Sup. Ct.) (pleading requires factual content permitting plausible inference of liability)