Wedi Corp v. Hydroblok Grand International Ltd
2:23-cv-00452
| W.D. Wash. | May 19, 2023Background
- wedi previously litigated substantially similar Lanham Act and CPA claims against Hydro-Blok-related entities in the Western District of Washington (consolidated cases beginning in 2015), which were resolved by arbitration, motions, settlement, and a Rule 41(a)(2) voluntary dismissal with prejudice in 2021.
- In March 2022 wedi sued Hydroblok Grand (Canada), Hydroblok Grand International Inc. (Nevada), and Hydro‑Blok USA LLC (Washington) in the District of Nevada alleging Lanham Act and Nevada deceptive-trade-practices claims based on defendants’ ICC‑ES certification statements.
- After more than a year in Nevada, Judge Silva transferred the Nevada case to the Western District of Washington, relying principally on the first‑to‑file rule because of the 2015 Washington litigation.
- wedi moved to retransfer the case back to Nevada; this Court reviewed whether transfer was proper under 28 U.S.C. §§ 1406 and 1404(a) and whether personal jurisdiction exists over Hydroblok–Nevada.
- The Court concluded Nevada was a proper venue (so §1406 transfer was not available) and that Judge Silva erred by applying the first‑to‑file rule without satisfying §1404(a)’s threshold that the case "might have been brought" in the transferee district (citing In re Bozic).
- On the existing record the Court found no prima facie showing of specific personal jurisdiction over Hydroblok–Nevada, ordered limited jurisdictional discovery, renoted wedi’s retransfer motion, and stayed the case except for discovery and supplemental briefing.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Properness of transfer under §1406 | Nevada was proper venue; transfer under §1406 improper | Judge Silva concluded Nevada venue was affected by first‑to‑file circumstance | Court: §1406 inapplicable because Nevada was a proper venue; Silva erred to rely on §1406 framing |
| Role of first‑to‑file rule vs. §1404(a) | First‑to‑file should not displace §1404(a) statutory requirements | Silva applied first‑to‑file to justify transfer | Court: Ninth Circuit precedent (In re Bozic) requires §1404(a)’s threshold be met; first‑to‑file cannot negate §1404(a) |
| Personal jurisdiction over Hydroblok–Nevada | wedi implies jurisdiction exists via defendants’ nationwide activities | Defendants assert Hydroblok–Nevada concedes at least specific jurisdiction and point to shared website/use of marketing | Court: On current record no prima facie showing of purposeful availment by Hydroblok–Nevada as to Washington; jurisdiction not established |
| Whether jurisdictional discovery should be allowed | wedi has no incentive to develop jurisdictional facts; discovery may be needed to resolve dispute | Defendants have not submitted sworn evidence showing forum contacts; risk of repetitive filings if discovery denied | Court: Exercised discretion to permit jurisdictional discovery and supplemental briefing before ruling on retransfer |
Key Cases Cited
- Pacesetter Sys., Inc. v. Medtronic, Inc., 678 F.2d 93 (9th Cir. 1982) (describing the first‑to‑file doctrine as federal comity allowing a court to decline jurisdiction where cases involve same parties and issues)
- Kohn Law Grp., Inc. v. Auto Parts Mfg. Miss., Inc., 787 F.3d 1237 (9th Cir. 2015) (setting the three‑factor first‑to‑file analysis: chronology, parties, issues)
- In re Bozic, 888 F.3d 1048 (9th Cir. 2018) (holding the first‑to‑file rule cannot override § 1404(a)’s threshold requirement that the action "might have been brought" in the transferee district)
- Freestream Aircraft (Bermuda) Ltd. v. Aero Law Grp., 905 F.3d 597 (9th Cir. 2018) (articulating the three‑part specific‑jurisdiction test and seven‑factor reasonableness analysis)
- Data Disc, Inc. v. Sys. Tech. Assocs., Inc., 557 F.2d 1280 (9th Cir. 1977) (prima facie showing standard for jurisdiction when decided on affidavits)
- Boschetto v. Hansing, 539 F.3d 1011 (9th Cir. 2008) (accept uncontroverted complaint allegations in jurisdictional analysis)
- Sher v. Johnson, 911 F.2d 1357 (9th Cir. 1990) (describing minimum‑contacts requirement for specific jurisdiction)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985) (establishing that jurisdiction must not be based on random, fortuitous, or attenuated contacts)