United States District Court, N.D. Mississippi, Aberdeen Division
HAAS OUTDOORS, INC. PLAINTIFF
DRYSHOD INTERNATIONAL, LLC and JAMES K. DONOHUE DEFENDANTS
Court today considers multiple motions to dismiss and
transfer [10, 12, 16] filed by Defendants James Donohue and
Dryshod, LLC. In this copyright and trademark infringement
action, Haas alleges that Defendants James Donohue, on behalf
of Dryshod began negotiations to license Haas' popular
Mossy Oak Break-Up camouflage pattern for apparel produced by
Dryshod. Donohue abruptly ended the negotiations and created
his own pattern and trademark. Haas asserts this pattern too
closely resembles Break-Up, and that the mark, MOBU, is
intended to confuse customers into believing they are buying
Mossy Oak products. Haas alleges that Defendants produced
apparel bearing the infringing pattern and mark and sold it
in the United States.
initially filed suit in the United States District Court for
the Western District of Texas for copyright and trademark
violations. After filing suit, Haas found some of the Dryshod
apparel in this district, where Haas' headquarters lie.
Haas purchased some of this apparel, dismissed the Texas
suit, and refiled here.
claim that they initially inquired about licensing Mossy Oak
camouflage for use on boots designed by Donohue and Dryshod.
At some point, Defendants decided to create their own pattern
rather than licensing those owned by Haas. Defendants assert
that they do not actually produce or sell any of the
allegedly infringing products. Rather, they claim that they
act as a "sourcing agent" for unaffiliated
distributors by designing apparel and then finding
manufacturers to produce the apparel, which is sold directly
from the manufacturer to the distributor. It was one of these
separate, unaffiliated distributors, Defendants claim, who
put the products into Mississippi. Donohue and Dryshod filed
motions to dismiss for lack of personal jurisdiction, to
dismiss for improper venue, and to transfer venue back to the
Western District of Texas.
claims the relationship between the Defendants and the
distributors was a bit more involved. It claims Defendants
and the distributors were involved in a joint business
venture that warrants imputing any contacts in Mississippi to
Donohue and Dryshod. The Court allowed limited discovery on
the jurisdictional issues to proceed, and the parties have
filed further briefs in support of their positions. The
motions are now ready for review. For the reasons set forth
below, the Court finds that Haas has failed to make a prima
facie showing that personal jurisdiction over Defendants
exists and that the case should be transferred.
a nonresident defendant presents a motion to dismiss for lack
of personal jurisdiction, the plaintiff bears the burden of
establishing the district court's jurisdiction over the
nonresident." Wilson v. Belin, 20 F.3d 644, 648
(5th Cir. 1994) (quoting Stuart v. Spademan, 772
F.2d 1185, 1192 (5th Cir. 1985)). When the district court
rules on the motion without an evidentiary hearing, the
plaintiff may bear his burden by presenting a. prima
facie case that personal jurisdiction is proper."
Id. (citing Thompson v. Chrysler Motor
Corp., 755 F.2d 1162, 1165 (5th Cir. 1985)). The Court
takes the allegations of the complaint as true, unless they
are controverted by opposing affidavits. Gardemal v.
Westin Hotel Co., 186 F.3d 588, 592 (5th Cir. 1999)
(citing Bullion v. Gillespie, 895 F.2d 213, 217 (5th
Cir. 1990)). The Court may consider "affidavits,
interrogatories, depositions, oral testimony, or any
combination of recognized discovery methods." Zyfo?//v.
DM Records, Inc., No. CIV.A.3:02-CV-1408-G, 2004 WL
1243153, at *5 (N.D. Tex. June 4, 2004) (citing Alfred v.
Moore & Peterson, 117 F.3d 278, 281 (5th Cir.
federal district court sitting in diversity may exercise
personal jurisdiction over a nonresident defendant if (1) the
long-arm statute of the forum state confers personal
jurisdiction over that defendant; and (2) exercise of such
jurisdiction by the forum state is consistent with due
process under the United States Constitution."
Latshaw v. Johnston, 167 F.3d 208, 211 (5th Cir.
Court first considers whether Mississippi's long-arm
statute confers personal jurisdiction of Defendants. The
long-arm statute confers jurisdiction over "[a]ny
nonresident person, firm, general or limited partnership, or
any foreign or other corporation not qualified under the
Constitution and laws of this state as to doing business
herein," in one of three ways. Miss. Code Ann. §
13-3-57. First, under the "contract prong",
personal jurisdiction attaches to anyone who contracts with a
resident of Mississippi where any part of the contract is
performed in the state. Id. Second, under the
"tort prong", personal jurisdiction may be had over
anyone who commits "a tort in whole or in part in this
state ..." Id. Finally, under the "doing
business prong" a non-resident is subject to
jurisdiction if it "performs any character of work or
service" in Mississippi. Id.
contends that jurisdiction is proper over Defendants under
the both the "doing business" and "tort"
prongs. According, to Haas, Defendants are amenable to
personal jurisdiction under the "doing business"
prong because Defendants attempted to secure a trademark and
copyright license from Haas in Mississippi, and because the
"Dryshod Joint Venture" sold infringing products in
also argues that Defendants are amendable to jurisdiction
under the "tort prong" because infringing products
were sold here and so Haas suffered injury here. Alfred
v. Moore & Peterson, 117 F.3d 278, 282 (5th Cir.
1997) ("Under the tort prong of the Mississippi long-arm
statute, personal jurisdiction is proper if any element of
the tort (or any part of any element) takes place in
Mississippi.") Haas also contends that because it is a
Mississippi corporation, any infringement injury occurred in
Court finds that there is no action taken by the
Defendant's themselves that would implicate any of the
three avenues of personal jurisdiction under
Mississippi's long arm statute.
are no facts that suggest Defendants themselves "do
business" in Mississippi. Defendants do not sell,
advertise, or otherwise transact any sort of business within
the state. Haas asserts that Defendants license negotiations
with Haas constitute doing business in Mississippi. These
discussions with Haas took place through emails and phone
calls over a four-month period, before Defendants ended
licensing efforts. See PL's Resp. in Opposition,
Ex. 2-3, 5-9 [73-2, 73-3, and 73-5 through 73-9] (draft
license agreements and emails between Defendants and Haas);
Pi's Resp., Ex. 4 James Donohue Dep. at 31-34 [73-4]. The
Defendants unconsummated negotiations to secure a license,
however, do not constitute "doing business" is in
the state. Cypress Pharm., Inc. v. Tiber Labs., LLC,
504 F.Supp.2d 129, 135-56 (S.D.Miss. 2007); Peterson v.
Test Int'l, EC, 904 F.Supp. 574, 579 (S.D.Miss.
1995) ("Moreover, mere negotiations or solicitation ...
by a nonresident defendant from an out-of-state locus is not
"doing business" in Mississippi.").
there any action by the Defendant's themselves which
could be considered committing any element or part of an
element within Mississippi. That Haas resides in Mississippi
does not necessarily mean the injury occurred in Mississippi,
because the actual injury must be distinguished from
"its resultant consequences". Alfred, 117
F.3d at 281. Thus, in the trademark context, courts have held
that the tort occurs where infringing sales are made, not
simply where the mark owner resides. See McRae's,
Inc. v. Hussain, 105 F.Supp.2d 594, 597 (S.D.Miss. 2000)
(collecting cases). The evidence provided bears out that it
was Team J, one of Dryshod's distributors, who
distributed the infringing products to the stores in
Mississippi. PL's Resp., Ex. 16, Team J Sales to
the fact that there is no allegation that Dryshod themselves
sold infringing products in Mississippi, Haas has shown no
evidence that a trademark injury occurred in Mississippi at
all. The only retail purchase of the offending goods was made
by Haas' employees. February 8, 2018 Receipt [25-3]. But
"trademark claims are founded on notions of customer
confusion." 721 Bourbon, Inc. v. House of Auth,
LLC,140 F.Supp.3d 586, 596 (E.D. La. 2015) (holding
there was no personal jurisdiction in trademark case where
the only evidence of a sale in forum state was a purchase
made by plaintiff). It cannot be said that Haas was
"confused as to the source of the products in
question." Id. It clearly ...