Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Franko Maps, Ltd. v. Nielsen

United States District Court, D. Hawaii

September 29, 2017

FRANKO MAPS LTD., Plaintiff,
v.
FRANK NIELSEN; CYNTHIA NIELSEN; GREEN PLANET MAPS, LLC; GALE DEAN LATTMAN doing business as H2O TO GO MAPS; DEREK T. HERMON; BEAR VALLEY BIKES SPEED-EVOLUTION, INC., PALM TRADERS LLC; VICKI WHITTER, Defendants.

          ORDER GRANTING IN PART AND DENYING IN PART MOTIONS TO DISMISS

          Leslie E. Kobayashi United States District Judge

         Before the Court are: pro se Defendant Gale Dean Lattman's (“Lattman”) Motion to Dismiss (“Lattman Motion”), filed on February 19, 2017; and Defendants Derek Hermon (“Hermon”) and Bear Valley Bikes Speed-Evolution's (“Bear Valley” and collectively “Bear Valley Defendants”) Motion to Dismiss (“Bear Valley Motion”), filed on June 9, 2017. [Dkt. nos. 19, 44.] Plaintiff Franko Maps, Ltd. (“Plaintiff”) filed its memorandum in opposition to the Lattman Motion (“Lattman Opposition”) on April 6, 2017, and its memorandum in opposition to the Bear Valley Motion (“Bear Valley Opposition”) on July 24, 2017. [Dkt. nos. 25, 49.] Lattman filed his reply declaration in support of his motion (“Lattman Reply Declaration”) on April 13, 2017, [1] and the Bear Valley Defendants filed their reply on July 31, 2017. [Dkt. nos. 28, 51.] These matters came on for hearing on August 14, 2017. The Lattman Motion and the Bear Valley Motion (“the Motions”) are hereby granted in part and denied in part for the reasons set forth below. The Motions are denied as to Count VII and the Motions are granted insofar as all of Plaintiff's other claims are dismissed without prejudice. All other requests in the Motions are denied.

         BACKGROUND

         Plaintiff filed its original Complaint on November 7, 2016. Plaintiff filed its Amended Complaint on November 15, 2016. [Dkt. no. 12.] The Amended Complaint names the following Defendants: Frank Nielsen (“F. Nielsen”); Cynthia Nielsen (“C.B. Nielsen”); Green Planet Maps, LLC (“Green Planet”); Lattman; Hermon; Bear Valley; Palm Traders LLC (“Palm Traders”); and Vicki Whitter (“Whitter”). According to Plaintiff, Defendants Frank and Cynthia Nielsen (“the Nielsens”) are Green Planet's managing members. [Amended Complaint at ¶ 4.] Only the factual allegations regarding Lattman and the Bear Valley Defendants are relevant to the instant Motions.

         I. Allegations Regarding Lattman

         Plaintiff states that, beginning on January 21, 2005, Lattman, doing business as H2O to Go Maps (“H2O”), began purchasing Plaintiff's maps as a wholesale distributor and selling them at retail stores at wholesale prices. [Id. at ¶¶ 5, 11.] In July 2005, Plaintiff and Lattman verbally agreed that Lattman would be its distributor for the California Delta area. [Id. at ¶ 15.] On July 31, 2005, Plaintiff first sold Franko's California Delta Adventure Guide (“Delta Map”) and Franko's California Delta Fish Identification Guide (“Delta Fish Card”) to Lattman, in bulk, at distributor prices. Both products had a copyright notice printed on them. Plaintiff sold additional shipments of the Delta Maps and the Delta Fish Cards to Lattman on: December 31, 2006; April 7, July 13, and November 14, 2011; February 28, May 22, June 6, and June 10, 2012. From 2007 to early 2011, Plaintiff made bulk distributor sales to Lattman through a subsidiary - Franko Maps LLC. [Id. at ¶¶ 12-14, Exhs. A-B (list of invoices and products sold).]

         Lattman would only deal with Plaintiff through F. Nielsen, who - at the time - was both an employee and a part owner of the company. [Id. at ¶ 16.] On August 27, 2012, Plaintiff's Board of Directors terminated F. Nielsen as an officer and employee for cause. In an email dated August 28, 2012, Plaintiff: informed Lattman of the termination; instructed him that all future communications with it must take place through the current officers, not through F. Nielsen; and informed him that it owned all of the company's intellectual property (“8/28/12 Email”). Plaintiff also sent Lattman a letter with substantially the same information. [Id. at ¶¶ 17-18, Exh. E (8/28/12 Email).] Along with the 8/28/12 Email and letter, Plaintiff provided Lattman with a copy of F. Nielsen's work for hire agreement (“Nielsen Agreement”), which confirmed that Plaintiff owned the copyright to all of its publications, including the Delta Map and Delta Fish Card, and all of the intellectual property created by F. Nielsen prior to his termination. [Id. at ¶ 19, Exh. F (F. Nielsen Agreement).]

         Plaintiff alleges that, sometime after his termination, F. Nielsen created derivative works using property that he failed to return to Plaintiff, including a computer, software, and intellectual property files. The derivative works included “Famous Franko's California Delta Map, ” which Plaintiff alleges infringes upon Plaintiff's Delta Map. [Id. at ¶ 20.] Lattman distributed Famous Franko's California Delta Map, and another version of it, under his H2O to Go band. [Id. & Exh. G (copies of illustrative portions of the allegedly infringing maps).] Plaintiff also alleges, upon information and belief, that Lattman distributes a product which infringes upon the Delta Fish Card. F. Nielsen allegedly created the product using Plaintiff's computer, software, and intellectual property. [Id. at ¶ 21.] Plaintiff filed a civil action against F. Nielsen and others in this district court. [Franko Maps Ltd., et al. v. Trident Diving Equipment, et al., CV 13-00637 LEK-KSC (“Franko Maps v. Trident”), Complaint, filed 11/20/13 (dkt. no. 1).] On December 2, 2013, Plaintiff filed an amended complaint alleging copyright infringement and other claims. [Franko Maps v. Trident, dkt. no. 5.] Plaintiff entered into a Settlement Agreement with F. Nielsen. This Court filed a consent judgment with a permanent injunction against F. Nielsen and Jonathan Nielsen (“Permanent Injunction”) on March 18, 2014. [Id., dkt. no. 27.] The Amended Complaint in the instant case notes that, in the Permanent Injunction, F. Nielsen admitted to committing copyright infringement and agreed not to commit further infringements, including making further derivatives or products that contained the same locations, subject matter, or titles as Plaintiff's products. Plaintiff emphasizes that the Settlement Agreement did not release Lattman, the Bear Valley Defendants, Whitter, or Palm Traders. [Amended Complaint at ¶ 23, Exh. H (Permanent Injunction and Settlement Agreement).] The Permanent Injunction applies to “Frank Nielsen and Jonathan Nielsen, and their agents, servants, representatives, employees, assigns, successors, affiliates, attorneys, or licensees, any persons, businesses, corporations, limited liability companies, or entities acting by, through, under, in concert, or in participation with them.” [Id., Exh. H (Permanent Injunction) at 2.]

         Plaintiff registered its copyright for the Delta Map on August 6, 2013. Its registration number is VA0001899229. Plaintiff registered the Delta Fish Card copyright on August 12, 2013, registration number VA0001898361. [Id. at ¶ 24, Exh. I (copyright registration information, excerpts of the Delta Map and entire Delta Fish Card).] Plaintiff alleges that, from a comparison of the Delta Map and the product Lattman distributed, the infringement is obvious. [Id. at ¶ 24, Exh. J (excerpts of Delta Map and excerpts of allegedly infringing map).]

         Plaintiff alleges that Lattman “willfully engaged in a course of conduct that infringes upon [Plaintiff]'s copyright rights by creating, displaying, offering, and/or selling derivative works and/or substantially similar copies of [Plaintiff]'s intellectual property, without the consent or authorization of [Plaintiff], and displaying, offering for sale, and selling such infringing items.” [Id. at ¶ 25.] Some of the infringing items bore Plaintiff's name, while others bore the name “Famous Franko's Maps” or H2O to Go. Plaintiff alleges, on information and belief, that F. Nielsen worked on the designs of the infringing products using the computer and software that he retained from his employment with Plaintiff. Plaintiff suspects F. Nielsen and Green Planet helped to create the H2O to Go Delta map - and other infringing products that Plaintiff expects to find in discovery - after the Settlement Agreement. Thus, these infringements were not released in the Settlement Agreement and they are violations of the Permanent Injunction. [Id.] Plaintiff alleges that these infringements and violations have caused it to suffer significant damages. [Id. at ¶ 26.]

         In addition, Plaintiff alleges that Lattman's products which contain the name “Famous Franko's Maps” infringe upon Plaintiff's “Franko's Maps” trademark. [Id. at ¶ 27.] Further,

the H20 to Go map falsely claims that “Dean Lattman H20 to Go” owns the copyright to that map and falsely states “Fabulous Maps of the California Delta Since 2002. Compiled by H20 Maps to Go” whereas [Plaintiff] was the designer and creator of the copyrighted design for those maps, H20 to Go did not compile or create them from 2002 and did not compile or create any Delta maps, and it was instead Frank Nielsen who wrongly created the H20 to Go map by improperly using [Plaintiff's] copyrighted design, which is a false representation under the Lanham Act and common law, and unfair competition and deceptive trade practice. . . .

[Id.] According to Plaintiff, Lattman's H2O to Go products also contain misleading uses of Green Planet's ISBN prefix to suggest that F. Nielsen and Green Planet created those maps for Lattman's distribution. Further, Plaintiff alleges that Lattman has accused Plaintiff of fraud because Plaintiff does not own the maps' copyrights and Lattman has represented that he “is ‘the real Franko.'” [Id.] Plaintiff alleges this is trademark infringement. [Id.]

         II. Allegations Regarding the Bear Valley Defendants

         According to the Amended Complaint, every year from 2005 until F. Nielsen's termination in August 2012, Plaintiff sold Hermon its Franko Maps Big Bear trail map - 2005 copyright registration number VA0001975995 - (“Big Bear Map”). Hermon sold the Big Bear Map at his store at Big Bear Lake in California and on his websites. [Id. at ¶ 32, Exh. O (excepts of Big Bear Map and copyright registration information).] Plaintiff alleges that Hermon knew Plaintiff was a Hawai`i citizen because the bills it sent him had its Hawai`i address, and Hermon sent checks to Plaintiff in Hawai`i. Plaintiff also alleges, on information and belief, that Hermon knew about: Plaintiff's copyrights to the Big Bear Map; and F. Nielsen's termination because he stopped buying maps from Plaintiff. [Id. at ¶¶ 32-33.]

         Plaintiff alleges that, at some point after his termination, F. Nielsen and Green Planet created derivative works using Plaintiff's computer, software and intellectual property, which F. Nielsen had wrongfully retained. In the Settlement Agreement and the Permanent Injunction, F. Nielsen admitted that one of these derivative works - Green Planet Maps Big Bear! & Lake Arrowhead Trail Map - infringed upon the Big Bear Map. [Id. at ¶ 34, Exh. P (excerpts of the Green Planet map).] The Settlement Agreement required F. Nielsen not to copy or make derivatives of Green Planet's Big Bear map or Plaintiff's Big Bear design. Plaintiff alleges, on information and belief, that Hermon distributed Green Planet's infringing map because Hermon did not buy Plaintiff's Big Bear Map after F. Nielsen's termination. [Id. at ¶ 34.]

         Plaintiff alleges, on information and belief, that F. Nielsen created an infringing version of the Big Bear Map for the Bear Valley Defendants called “The Definitive Big Bear Trail Map.” [Id. at ¶ 34, Exh. Q (excerpts of the Bear Valley Defendants' Big Bear map).] Plaintiff alleges that the Bear Valley Defendants' Big Bear map falsely claimed that Hermon owned the copyright to the design and misleadingly used Green Planet's ISBN prefix. Plaintiff alleges the use of Green Planet's ISBN shows that F. Nielsen and Green Planet created the infringing map for the Bear Valley Defendants. Plaintiff argues that it is obvious from a comparison of its Big Bear Map to Green Planet's version and the Bear Valley Defendants' version that there was wrongful copying. [Id. at ¶ 34, Exh. R (examples of Pltf.'s Big Bear Map, compared to the Green Planet map and the Bear Valley Defendants' map).] Plaintiff alleges, on information and belief, that F. Nielsen's involvement with the Bear Valley Defendants' Big Bear map occurred after the 2013 settlement. [Id. at ¶ 40.]

         Plaintiff alleges that F. Nielsen, Green Planet, and the Bear Valley Defendants “willfully engaged in a course of conduct that infringes upon [Plaintiff]'s copyright rights by creating, displaying, offering, and/or selling derivative works and/or substantially similar copies of [Plaintiff]'s intellectual property, without the consent or authorization of [Plaintiff], and displaying, offering for sale, and selling such infringing items.” [Id. at ¶ 35.] Plaintiff alleges, on information and belief, that F. Nielsen designed the infringing products using Plaintiff's computer and intellectual property that he wrongfully retained after his termination. [Id.] Plaintiff argues that the false and misleading information in the infringing maps of Big Bear “constitute false advertising under the Lanham Act, misrepresentation, and unfair competition and deceptive trade practices.” [Id. at ¶ 36.]

         Plaintiff alleges that the Nielsens, Green Planet, and others acting in concert or participating with them - which may include the Bear Valley Defendants - were prohibited by the Permanent Injunction and the Settlement Agreement “not just from infringing and making or distributing any derivatives, but also from making, having made, displaying, offering, distributing, or selling any map or card dealing with Big Bear or Bear Valley, regardless of how similar or dissimilar it looked from [Plaintiff]'s copyrighted designs.” [Id. at ¶ 37 (citing Permanent Injunction at ¶ 2(a); Settlement Agreement at ¶ 4(a)).] Thus, Plaintiff alleges that making, ordering, displaying, distributing, and selling of either Green Planet's Big Bear map or the Bear Valley Defendants' Big Bear map violated the Permanent Injunction and the Settlement Agreement. [Id.] Plaintiff also argues that, because Green Planet's map and the Bear Valley Defendants' map were obviously made with Plaintiff's trade secrets, software, and intellectual property, the Nielsens, Green Planet, and those acting in concert/participation with them violated the Settlement Agreement and Permanent Injunction, which prohibited the use, retention, distribution, passing on, or keeping of Plaintiff's trade secrets, software, computer files, or other property. [Id. at ¶ 38 (citing Permanent Injunction at ¶ 2(j); Settlement Agreement at ¶ 4(j)).]

         Plaintiff alleges that it has suffered and will suffer significant damages as a result of F. Nielsen and the Bear Valley Defendants' wrongful activity, including lost profits and loss of goodwill, trust, and reputation in their industry. [Id. at ¶ 39.]

         III. Plaintiff's Claims and the Pending Motions

         Plaintiff alleges the following claims: copyright infringement (“Count I”); an unfair methods of competition claim under Haw. Rev. Stat. § 480-2 (“Count II”); an unfair and deceptive trade practices claim under Haw. Rev. Stat. § 481A-3 (“Count III”); common law claims of unfair competition, palming off, and trade name and trademark infringement (“Count IV”); trademark infringement and counterfeiting, pursuant to 15 U.S.C. § 1114 (“Count V”); breach of contract (“Count VI”); violation of the Permanent Injunction (“Count VII”); and false advertising and misrepresentation under the Lanham Act and under common law, and defamation (“Count VIII”).

         Lattman seeks dismissal of Plaintiff's claims against him pursuant to Fed.R.Civ.P. 12(b)(2) and (3) for lack of personal jurisdiction and improper venue. In the alternative, Lattman asks this Court to transfer venue to the Eastern District of California, pursuant to 28 U.S.C. § 1404. If this Court rejects these arguments, Lattman seeks dismissal of Counts II, III, IV, V, and VII pursuant to Rule 12(b)(6).

         The Bear Valley Motion also seeks dismissal for lack of personal jurisdiction and improper venue. The Bear Valley Defendants do not seek transfer of venue because they contend that the claims Plaintiff has included in this case are unrelated and there is no one venue that is proper for all claims.

         DISCUSSION

         I. Personal Jurisdiction

         In reviewing a Rule 12(b)(2) motion to dismiss for lack of personal jurisdiction, this Court has stated:

A plaintiff has the burden of establishing personal jurisdiction over a nonresident defendant. See Love v. Associated Newspapers, Ltd., 611 F.3d 601, 608 (9th Cir. 2010); Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004). A plaintiff must establish personal jurisdiction over a defendant with respect to each claim. Action Embroidery Corp. v. Atl. Embroidery, Inc., 368 F.3d 1174, 1180 (9th Cir. 2004) (“Personal jurisdiction must exist for each claim asserted against a defendant.” (citing Data Disc, Inc. v. Sys. Tech. Assocs., Inc., 557 F.2d 1280, 1289 n.8 (9th Cir. 1977)).
When, as here, a district court acts on a motion to dismiss without holding an evidentiary hearing, a plaintiff need only make a prima facie showing of jurisdictional facts to withstand the motion to dismiss. Love, 611 F.3d at 608; Schwarzenegger, 374 F.3d at 800. Although a plaintiff may not simply rest on the bare allegations of the complaint, uncontroverted allegations in the complaint must be taken as true, and conflicts between parties over statements contained in affidavits or declarations must be resolved in the plaintiff's favor. See Love, 611 F.3d at 608; Schwarzenegger, 374 F.3d at 800.

Barranco v. 3D Sys. Corp., 6 F.Supp.3d 1068, 1076 (D. Hawai`i 2014) (some citations omitted).

The district court considers two factors before exercising personal jurisdiction over a nonresident defendant in a diversity of citizenship case: “(1) whether an applicable state rule or statute potentially confers jurisdiction over the defendant; and (2) whether assertion of such jurisdiction accords with constitutional principles of due process.” Flynt Distrib. Co. v. Harvey, 734 F.2d 1389, 1392 (9th Cir. 1984). “The jurisdictional inquiries under state law and federal due process merge into one analysis” when, as here, the state's long-arm statute is “coextensive with federal due process requirements.” Roth v. Garcia Marquez, 942 F.2d 617, 620 (9th Cir. 1991).[2] See Cowan v. First Ins. Co. of Hawaii, 61 Haw. 644, 649, 608 P.2d 394, 399 (1980) (Hawaii's long-arm statute, Haw. Rev. Stat. § 634-35, was adopted to expand the jurisdiction of Hawaii's courts to the extent permitted by the due process clause of the Fourteenth Amendment). . . .
The Due Process Clause protects a person's “liberty interest in not being subject to the binding judgments of a forum with which he has established no meaningful ‘contacts, ties, or relations.'” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 471-72 (1985) (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 319 (1945)). The Due Process Clause requires that defendants have “certain minimum contacts with [Hawaii] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Int'l Shoe, 326 U.S. at 316; Data Disc, Inc. v. Systems Tech. Assocs., Inc., 557 F.2d 1280, 1287 (9th Cir. 1977). The minimum contacts required mean that the defendant must have purposefully availed itself of the privilege of conducting activities within the foreign jurisdiction, thereby invoking the benefits and protections of the foreign jurisdiction's laws. See Asahi Metal Indus. Co. v. Sup. Court of Cal., 480 U.S. 102, 109 (1987). In applying Due Process Clause requirements, courts have created two jurisdictional concepts - general and specific jurisdiction.
A court may exercise general jurisdiction over the defendant when the defendant is a resident or domiciliary of the forum state, or the defendant's contacts with the forum state are continuous, systematic, and substantial. Helicopteros Nacionales de Columbia, S.A. v. Hall, 466 U.S. 408, 414-16 [104 S.Ct. 1868');">104 S.Ct. 1868, 80 L.Ed.2d 404 (1984)]; Data Disc, 557 F.2d at 1287 . . . .
Specific jurisdiction, on the other hand, may be found when the cause of action arises out of the defendant's contact or activities in the forum state. See Roth v. Garcia Marquez, 942 F.2d 617, 620 (9th Cir. 1991); Data Disc, 557 F.2d at 1287. . . .

Id. at 1077-78 (some alterations in Barranco) (some citations omitted).

         A. General Jurisdiction

         Although Plaintiff pled general jurisdiction, [Amended Complaint at ¶ 10 (pg. 5), ] at the hearing on the Motions, Plaintiff's counsel represented that Plaintiff is not contending that there is general jurisdiction. Based on this representation and its own review of Plaintiff's factual allegations and the relevant case law, this Court ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.