Amarte USA Holdings, Inc. v. Kendo Holdings Inc.

Background

Amarte sued Kendo Holdings Inc., Marc Jacobs International, Sephora USA, Inc., and The Neiman Marcus Group LLC in the Northern District of California. The lawsuit alleged trademark infringement and related state-law claims involving the distribution and sale of Marc Jacobs Beauty EYE-CONIC eyeshadow.

Amarte sought permission to add more defendants in three proposed amended complaints. The court denied the first two requests without prejudice because Amarte had not plausibly stated claims against the proposed defendants and amendment would therefore be futile. The court denied the third request with prejudice for the same futility reason.

On February 7, 2024, Amarte filed a related lawsuit in the Southern District of New York concerning the same eyeshadow product. Kendo asserted that the New York defendants were defendants, or legally connected to defendants, in Amarte’s rejected proposed complaint. Kendo asked this court to permanently bar Amarte from filing or maintaining related trademark claims against those parties or their legally connected entities in any forum.

Legal standard

A party seeking a permanent injunction must show irreparable injury, that money damages would not adequately compensate for the injury, that the balance of hardships supports equitable relief, and that an injunction would not harm the public interest. The court also explained that an injunction stopping litigation in another federal district is an extraordinary remedy generally reserved for unusual cases. When related cases are filed in two districts, the later-filed court generally has discretion to transfer, pause, or dismiss the later case.

Court’s analysis

The court determined that the New York Action involved the same issues and at least some of the same parties as the California Action. Under the governing precedent, the Southern District of New York—not this court—could decide whether the New York Action should be transferred, stayed, or dismissed. Kendo had already filed a motion to dismiss in New York based on the California court’s related decisions, so the New York court was aware of the proceedings.

The court also found that Kendo had not shown irreparable harm. Kendo relied on resources it had already spent on discovery and argued that it might have to pay those expenses again. The court stated that economic injury alone does not establish irreparable harm. It further reasoned that the New York court could dismiss Amarte’s case if dismissal was appropriate.

The court found no showing that the public interest favored an injunction. Instead, preserving respect between federal courts supported denying the injunction. The court distinguished a case involving a pro se plaintiff who had filed actions in thirty courts and explained that Amarte had not shown comparable vexatious litigation. The court stated that the question was not whether it had authority to enjoin the New York Action, but whether it should exercise that authority here.

Disposition

The court DENIES Kendo’s motion for a permanent injunction. The opinion does not state that the motion was denied with or without prejudice.