Lopez v. Cookies SF, LLC

Background

Robert G. Lopez, proceeding without a lawyer, alleged trademark infringement, unfair competition, and unjust enrichment based on the alleged commercial use of his NEW YORK CANNABIS and NYC NEW YORK CANNABIS marks. He alleged that the marks, or confusingly similar versions, appeared on curated boxes of cannabis products and related merchandise delivered to subscribers.

The pending motions were filed by Fluids Manufacturing, Inc. and by Cookies SF, LLC and Cookies Creative Consulting & Promotions, Inc., which the opinion calls the “Cookies Entities.” Fluids distributes cannabis products and sells related merchandise and apparel under the HEAVY HITTERS brand. The Cookies Entities sell cannabis-related products and clothing through online and mail sources. Lopez alleged that these defendants partnered or collaborated with Nana & Pop Corp. to market and sell the curated boxes. Nana & Pop had filed an answer, according to the opinion.

Procedural History and Issue

Fluids and the Cookies Entities moved to dismiss under Federal Rule of Civil Procedure 12(b)(2), for lack of personal jurisdiction, and Rule 12(b)(6), for failure to state a claim. Lopez did not oppose either motion. The court first considered personal jurisdiction because a court generally must establish its authority over the defendants before reaching other grounds for dismissal.

Personal jurisdiction is a court’s authority to require a defendant to participate in a case. The court explained that Lopez had to make a preliminary showing that jurisdiction existed, including a statutory basis under New York law and sufficient contacts with New York consistent with constitutional fairness.

Court’s Analysis

The court rejected the complaint’s general allegation that the defendants engaged in continuous and significant business activities in New York and committed acts aimed at causing harm there. The court treated that allegation as a legal conclusion rather than specific supporting facts. The complaint identified Fluids and the Cookies Entities as California companies with their principal places of business in California, but did not allege facts showing that they were essentially at home in New York.

The court also rejected the apparent argument that the defendants’ alleged dealings with Nana & Pop established specific jurisdiction. Specific jurisdiction requires a connection between the defendants’ own contacts with the state and the claims at issue. The unilateral activities of another party cannot supply that connection. The complaint did not allege facts showing that the defendants purposefully directed their activities toward New York or otherwise purposefully took advantage of conducting business there. The court also noted that the complaint did not allege that Nana & Pop actually sold goods in New York or to New York residents.

Because New York’s long-arm statute did not provide personal jurisdiction on the allegations presented, the court did not reach the constitutional due-process question or the defendants’ argument that the complaint failed to state a claim.

Disposition

The court granted the defendants’ motions to dismiss without prejudice. It stated that Lopez could amend the complaint to the extent he had a good-faith basis to do so. The Clerk of Court was directed to terminate the motions at docket entries 19 and 56. Judge Ronnie Abrams signed the memorandum opinion and order on September 22, 2022.