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Tower Laboratories, Ltd. v. Lush Cosmetics Limited

United States District Court, District of Columbia

January 24, 2018

TOWER LABORATORIES, LTD., Plaintiff,
v.
LUSH COSMETICS LIMITED, et al., Defendants.

          MEMORANDUM OPINION

          JAMES E. BOASBERG, UNITED STATES DISTRICT JUDGE.

         Ever wonder what makes your bath bubbly? Our effervescent personal-care products, responds Tower Laboratories, Ltd., in this patent-infringement suit against nine entities affiliated with Lush Cosmetics Limited. Three Lush companies now move to dismiss for improper venue, and the remaining six separately ask that the case against them be transferred to the District of Connecticut. Agreeing, the Court will grant both Motions.

         I. Background

         According to the Complaint, which must for now be presumed true, Tower “is a market leader engaged in the manufacture and sale of effervescent products sold into the personal care, medical device, pharmaceutical, nutraceutical and cleaning industries.” Compl., ¶ 2. The nine Defendants - more on their particular places of residence later - are all affiliated companies; through their sales and importation of cosmetic products, they are all purportedly infringing Tower's United States Patent 6, 121, 215, known as the ‘215 Patent. Id., ¶¶ 1, 3-11. One Lush entity - Lush Cosmetics NY, LLC - operates a store in D.C. The Complaint, filed on September 19, 2017, alleges one count of patent infringement. Id. at 8.

         Defendants have responded with two independent Motions. In the first, three Defendants - Lush Cosmetics LLC, Lush Internet Inc., and Lush Licensing Inc. - move for outright dismissal on the ground of improper venue. In the second, the remaining six Defendants - Lush Cosmetics Limited, Lush Ltd., Lush Handmade Cosmetics Ltd., Lush Manufacturing Ltd., Cosmetic Warriors Limited, and Lush Cosmetics NY, LLC - move for transfer of venue to Connecticut. After setting out the legal standard, the Court addresses each Motion separately.

         II. Legal Standard

         A. Rule 12(b)(3) and § 1406 Dismissal

         When a plaintiff brings suit in an improper venue, the district court “shall dismiss [the case], or if it be in the interest of justice, transfer such case to any district or division in which it could have been brought.” 28 U.S.C. § 1406(a); see also Fed.R.Civ.P. 12(b)(3) (may assert improper venue via motion). In considering a Rule 12(b)(3) motion, the Court “accepts the plaintiff's well-pled factual allegations regarding venue as true, draws all reasonable inferences from those allegations in the plaintiff's favor, and resolves any factual conflicts in the plaintiff's favor.” Pendleton v. Mukasey, 552 F.Supp.2d 14, 17 (D.D.C. 2008) (citing Darby v. U.S. Dep't of Energy, 231 F.Supp.2d 274, 276-77 (D.D.C. 2002)). The Court need not, however, accept the plaintiff's legal conclusions as true, Darby, 231 F.Supp.2d at 277, and may consider material outside of the pleadings. Artis v. Greenspan, 223 F.Supp.2d 149, 152 (D.D.C. 2002) (citing Land v. Dollar, 330 U.S. 731, 735 n.4 (1947)). “Because it is the plaintiff's obligation to institute the action in a permissible forum, the plaintiff usually bears the burden of establishing that venue is proper.” Freeman v. Fallin, 254 F.Supp.2d 52, 56 (D.D.C. 2003); 14D Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 3826 (4th ed. 2008 & April 2017 update) (“[W]hen an objection has been raised, the burden is on the plaintiff to establish that the district he or she has chosen is a proper venue.”).

         B. § 1404 Transfer of Venue

         Even where a plaintiff has brought its case in a proper venue, a district court may, “for the convenience of parties and witnesses, in the interests of justice . . . transfer [it] . . . to any other district . . . where [the case] might have been brought.” 28 U.S.C. § 1404(a). District courts have “discretion . . . to adjudicate motions for transfer according to an ‘individualized, case-by-case consideration of convenience and fairness.'” Stewart Org., Inc. v. Ricoh Corp., 487 U.S. 22, 29 (1988) (quoting Van Dusen v. Barrack, 376 U.S. 612, 622 (1964)).

         III. Analysis

         A. § 1406 Dismissal

         In considering the Motion to Dismiss of the three Defendants, the Court must analyze the applicability of the patent-venue statute, 28 U.S.C. § 1400(b). That section states, in relevant part, “Any civil action for patent infringement may be brought in the judicial district where the defendant resides, or where the defendant has committed acts of infringement and has a regular and established place of business.” There is no dispute that the three Defendants do not “reside” in the District of Columbia; indeed, Plaintiff itself alleges that they are a Delaware limited-liability company and two Nevada corporations. See Compl., ¶¶ 6-8. In addition, Tower does not contend that any operates a place of business in this city. See In re Cray Inc., 871 F.3d 1355, 1360 (Fed. Cir. 2017) (finding “three general requirements relevant to the [last] inquiry: (1) there must be a physical place in the district; (2) it must be a regular and established place of business; and (3) it must be the place of the defendant”).

         This does not mean, however, that Plaintiff has thrown in the towel; on the contrary, Tower believes that § 1400(b) should yield to the general venue statute, 28 U.S.C. § 1391. As Plaintiff explains further, since “[t]here is no one district where Plaintiff's Complaint could be filed and all members of Defendants' self-styled ‘corporate family' that work together to infringe the claims of the ‘215 Patent may be found, ” the general venue statute permits suit in a single federal district. See MTD Opp. at 3. As Lush Cosmetics NY, LLC operates a store in Georgetown, ...


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