goGLOW Enterprises, LLC v. GP MBM, LLC

Background

goGLOW Enterprises, LLC alleged that GP MBM, LLC used a GlowPass logo that infringed goGLOW’s registered trademark and supported claims for trademark infringement and unfair competition. goGLOW sought compensatory damages and an order preventing GP MBM from using the alleged infringing trademark.

GP MBM is an Arizona limited liability company with its principal place of business in Colorado. It is an affiliate of WellBiz Brands, Inc., which manages several beauty and wellness brands operated through independent franchisees. More than 900 franchise locations operate across the United States, including twelve in Minnesota. The GlowPass program applied only to locations in Denver, Colorado, and Scottsdale, Arizona.

Motion to Dismiss

GP MBM moved to dismiss under Federal Rule of Civil Procedure 12(b)(2) for lack of personal jurisdiction, meaning the court’s legal authority over the defendant. The court considered only general jurisdiction because goGLOW did not argue that Minnesota had specific jurisdiction over GP MBM. General jurisdiction allows a court to hear any type of claim against a company when the company’s connections with the state are strong enough to make it essentially “at home” there.

GP MBM was not incorporated in Minnesota and did not have its principal place of business there. GoGLOW argued that GP MBM could still be subject to general jurisdiction because it was an alter ego of WellBiz—that is, because the two companies allegedly operated closely enough to be treated as the same entity for jurisdictional purposes.

The court rejected the jurisdictional theory without deciding whether GP MBM was WellBiz’s alter ego. The court held that WellBiz itself was not subject to general jurisdiction in Minnesota. WellBiz’s Minnesota connections consisted of its relationship with twelve independently owned and managed franchise locations among more than 900 locations nationwide. The court found those connections too limited to make WellBiz essentially at home in Minnesota. It reasoned that treating those connections as sufficient would potentially subject WellBiz to general jurisdiction in every state where it had franchisees.

Because WellBiz was not subject to general jurisdiction in Minnesota, the court concluded that goGLOW’s alter-ego theory could not establish general jurisdiction over GP MBM. The court therefore granted GP MBM’s Motion to Dismiss for Lack of Jurisdiction. The court did not reach GP MBM’s alternative request for transfer based on the convenience of the forum or any other arguments.

Motion for Jurisdictional Discovery

GoGLOW requested discovery about the nature and extent of GP MBM’s relationship with WellBiz. The court explained that jurisdictional discovery may be allowed when additional facts could resolve the jurisdictional question, but it is not warranted when the alleged additional facts would not change the result.

The court denied goGLOW’s request because the relevant facts were not unknown or disputed. Even assuming GP MBM was WellBiz’s alter ego, WellBiz’s Minnesota affiliations were insufficient for general jurisdiction. The court also noted that goGLOW had not provided documentary evidence showing that discovery could establish another basis for jurisdiction. The court therefore denied goGLOW’s Motion for Discovery.

Disposition

The order granted Defendant’s Motion to Dismiss for Lack of Jurisdiction and denied Plaintiff’s Motion for Discovery. The court directed that judgment be entered accordingly. The opinion did not decide whether GP MBM infringed goGLOW’s trademark or violated unfair-competition law.