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Clockwork Ip, LLC v. Clearview Plumbing & Heating Ltd.

United States District Court, E.D. Missouri, Eastern Division

August 31, 2015

CLOCKWORK IP, LLC, AIRTIME, LLC, and AQUILA INVESTMENT GROUP, LLC, Plaintiffs,
v.
CLEARVIEW PLUMBING & HEATING LTD. and GIRAFFE CORPORATION, Defendants

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[Copyrighted Material Omitted]

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          For Clockwork IP, LLC, Airtime, LLC, Aquila Investment Group, LLC, Plaintiffs: George R. Spatz, LEAD ATTORNEY, PRO HAC VICE, MCGUIRE WOODS, LLP, Chicago, IL; Michael A. Clithero, LEAD ATTORNEY, LATHROP AND GAGE, LLP, Clayton, MO; William N. Federspiel, LEAD ATTORNEY, MCGUIRE WOODS LLP, Richmond, VA.

         For Clearview Plumbing & Heating, Ltd., Giraffe Corporation, Defendants: Adam D. Hirtz, LEAD ATTORNEY, LOWENBAUM PARTNERSHIP, L.L.C., St. Louis, MO; Jamie Nicole Mahler, THE LOWENBAUM PARTNERSHIP, St. Louis, MO.

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         MEMORANDUM AND ORDER

         JOHN A. ROSS, UNITED STATES DISTRICT JUDGE.

         This matter is before the Court on Defendants' Motion to Dismiss for Lack of

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Personal Jurisdiction. (Doc. No. 21) The motion is fully briefed and ready for disposition.

         Background

         This action arises out of an intellectual property dispute. Plaintiffs Clockwork IP, LLC (" Clockwork" ), AirTime, LLC (" AirTime" ), and Aquila Investment Group, LLC (" Aquila" ) (collectively " Plaintiffs" ) bring this action against two Canadian companies, Defendants Clearview Plumbing & Heating LTD (" Clearview" ) and Giraffe Corporation (" Giraffe" ), for trademark infringement under 15 U.S.C. § 1114 (Count I), unfair competition under 15 U.S.C. § 1125(a) (Count II), conversion (Count III), fraudulent inducement (Count IV), and tortious interference with a business expectancy (Count V).

         Clockwork is a Delaware limited liability company with its principal place of business in Sarasota, Florida. (Complaint (" Compl." ), Doc. No. 1 at ¶ 3) Clockwork is the intellectual property holding subsidiary of Clockwork, Inc., d/b/a Clockwork Home Services, under three principle brand names: Benjamin Franklin the Punctual Plumber® , One Hour Heating & Air Conditioning® and Mr. Sparky® . (Id. at ¶ ¶ 1, 19) Clockwork Home provides plumbing, heating and air conditioning, and electrical services in North America. (Id. at ¶ 1) Aquila is an Illinois limited liability company d/b/a Success Group International (" SGI" ), with its principal place of business in Sarasota, Florida. (Id. at ¶ 5) SGI offers business services to contractors who do not want to become franchisees. Instead, these contractors become SGI Affinity Group members and receive the same business process tools and technical training as franchisees without relinquishing their name and brand identity. (Doc. No. 22 at ¶ 6) AirTime is a Missouri limited liability company with its principal place of business in Sarasota, Florida. At all relevant times, AirTime operated the SGI Affinity Group.[1] (Id. at ¶ ¶ 4, 6) Clearview is primarily engaged in the business of plumbing, air conditioning and heating services in Canada. (Id. at ¶ 7); Giraffe is an intellectual property holding company owned and controlled by Clearview. (Id. at ¶ 8) Both Clearview and Giraffe are organized and existing under the laws of Canada. (Id. at ¶ ¶ 7, 8)

         According to Plaintiffs, this dispute arises from Defendants' activities with SGI. (Doc. No. 26 at 2) Plaintiffs allege that Defendants' first identified interaction with AirTime and SGI occurred around 2000 when Clearview's principal, Kyle Lumsden, attended an event hosted by SGI in New Jersey where Clockwork Home announced its franchise branding for THE PUNCTUAL PLUMBER. (Compl. at ¶ ¶ 11, 33) Sometime thereafter, Clearview misappropriated and adopted THE PUNCTUAL PLUMBER marks for itself. (Id. at ¶ 34) Plaintiffs further allege that sometime in 2008, Clearview targeted their Tech Seal Program and misappropriated their TECH SEAL mark. (Id. at ¶ ¶ 38-40)

         From March 2011 until May 2013, Clearview was a member of SGI's licensed Canadian affiliate, SGI Canada. As a member of SGI Canada, Clearview had the opportunity to license Clockwork trademarks for use in its business. (Id. at ¶ ¶ 12, 30)

         In October 2011, Clearview was offered three licensing agreements for AirTime marks; the marks offered were WE FIX IT OR IT'S FREE; GREEN SCREENED; and the TECH SEAL mark. (Id. at ¶ 41) Clearview executed license agreements for the marks WE FIX IT OR IT'S FREE and GREEN

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SCREENED. Because Clearview was already using a " colorable imitation" of the TECH SEAL mark, it did not execute the agreement for the TECH SEAL mark. (Id. at ¶ 42) All actions arising out of or relating to these licensing agreements were required to be brought in either the Twenty-First Judicial Circuit Court of the State of Missouri or the United States District Court for the Eastern District of Missouri, Eastern Division.[2] (Id. at ¶ 12) Plaintiffs contend that Clearview's repeated misappropriation of Clockwork's intellectual property has hindered it from marketing and growing its Benjamin Franklin Plumbing business and diminished the value of its marks.

         Defendants move to dismiss the complaint for lack of personal jurisdiction pursuant to Fed.R.Civ.P. 12(b)(2). Defendants argue they have not transacted business in Missouri, made any contracts in Missouri, or committed any tortious acts in Missouri. Even if they had engaged in such activities, Defendants argue they lack sufficient minimum contacts with Missouri to satisfy due process. (Doc. No. 22 at 2) The principal of Clearview, Kyle Lumsden, and the principal of Giraffe, Melanie Lumsden, have filed declarations in support of these arguments. (Doc. Nos. 22-1, 21-2) In response, Plaintiffs argue that because Defendants directed their tortious conduct, in part, at a Missouri company, and otherwise have the requisite minimum contacts to support jurisdiction in Missouri and the United States, their motion should be denied. (Doc. No. 26 at 6-7)

         Legal ...


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