Blue Bay Ventures LLC v. John Buys Bay Homes LLC

Background

Blue Bay Ventures LLC owns the registered trademark “Brothers Buy Homes” and alleges that it has used the mark since January 8, 2020. The complaint alleges that the defendants began using the same name without permission in 2021, creating market confusion, and that later misrepresentations caused more than $5,000,000 in lost business. The complaint asserts six causes of action: claims under the Lanham Act for trademark or trade-dress infringement and false designation of origin; common-law trademark infringement; unlawful, unfair, and fraudulent business practices; and intentional and negligent interference with a prospective economic advantage.

Blue Bay Ventures filed the action in the Superior Court of California for the City and County of San Francisco on September 23, 2024. The defendants removed it to federal court on October 14, 2024, based on the Lanham Act claims. Blue Bay Ventures then moved to remand, meaning it asked the federal court to return the case to state court.

The Parties’ Arguments

Blue Bay Ventures argued that remand was appropriate because state courts have concurrent jurisdiction over Lanham Act claims, meaning both state and federal courts can hear them. It also argued that the Lanham Act did not preempt its state-law claims and that the federal court had discretion to remand all the claims together. In its reply, it argued that the federal and state claims were interconnected and that separating them would be impractical.

The court explained that concurrent jurisdiction does not make removal improper. A plaintiff may avoid federal jurisdiction by relying exclusively on state law, but Blue Bay Ventures had chosen to plead and continue pursuing federal Lanham Act claims. The court also explained that the authorities cited by Blue Bay Ventures involved cases in which the federal claims had been dismissed or were not actually asserted. Here, the federal claims remained pending.

Ruling

The court held that the federal claims appearing on the face of the complaint established federal-question jurisdiction under 28 U.S.C. § 1331. The additional state-law claims did not eliminate that jurisdiction. The court further held that the discretionary-remand principles discussed in the cited cases did not apply because Blue Bay Ventures had not dismissed its Lanham Act claims. The court therefore DENIED Plaintiff’s motion to remand. The order addressed removal and jurisdiction, not the merits of the trademark and other claims.