AMERICAN GIRL, LLC v. ZEMBRKA

Background

American Girl, LLC alleged that Zembrka, doing business through several websites, sold products that appeared to copy American Girl products and trademarks. The complaint alleged that the defendants used American Girl names, images, colors, and marks without authorization. American Girl obtained a temporary restraining order that froze the defendants’ websites and accounts and barred continued sales of the allegedly infringing products. American Girl then sought a preliminary injunction lasting through the litigation.

The defendants moved to dismiss for lack of personal jurisdiction and ineffective service of process. The opinion’s analysis and disposition focused on personal jurisdiction. The defendants were described as being based in China. American Girl’s counsel attempted to purchase products from the defendants’ websites using a New York shipping address, but the products were never delivered and the purchase price was refunded.

Personal Jurisdiction

Personal jurisdiction is a court’s authority to exercise power over a defendant. American Girl did not claim that New York had general jurisdiction over the defendants, meaning authority based on contacts so substantial that a defendant is essentially at home in the state. Instead, it relied on specific jurisdiction, which requires a connection between the defendant’s forum-related conduct and the claims.

The court first examined New York’s long-arm statute. American Girl relied on two provisions: one covering defendants who transact business in New York, and another covering out-of-state tortious acts that cause injury in New York.

Transaction of Business

The court held that American Girl had not made the required initial showing that the defendants transacted business in New York. It found no completed sale or shipment of a product into New York and no evidence that the defendants took action specifically targeting New York. The websites’ accessibility from New York, by itself, was not enough. The attempted purchases by American Girl’s counsel did not establish a New York transaction because no product reached New York and the money was refunded.

Tortious Conduct and Injury

The court accepted that alleged trademark infringement could qualify as a tort for purposes of New York’s long-arm statute and that American Girl’s claims arose from the alleged infringement. But the court held that American Girl had not shown an injury in New York. Under the authorities discussed in the opinion, the injury from internet-based infringement was located where the trademark holder was located; the complaint placed American Girl’s principal place of business in California. The court also found that American Girl had not identified New York customers who were confused by or purchased the alleged counterfeits. Because American Girl had not shown injury in New York, the court did not analyze the remaining requirements of the tort-injury provision.

Because New York law did not authorize jurisdiction, the court did not reach the separate question whether jurisdiction would satisfy constitutional due-process requirements. The court also declined to allow jurisdictional discovery because American Girl had not made a threshold showing of a colorable jurisdictional basis; the requested discovery would have sought to create, rather than supplement, such a claim.

Disposition

The court granted the defendants’ motion to dismiss American Girl’s complaint, denied American Girl’s motion for a preliminary injunction, dissolved the previously entered temporary restraining order, directed that the case be closed, and did not resolve the underlying trademark-infringement claims on their merits. The opinion stated that American Girl might be able to refile in a more appropriate forum.