Jackson v. Phenomenal Vinyl Corp. et al

Motion to Dismiss for Failure to State a Claim and for Lack of Jurisdiction Pursuant to Federal Rules of Civil Procedure, Rule 12

E.D.N.Y.February 15, 2017

3290839.1 1 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK CURTIS J. JACKSON, III, Plaintiff, vs. PHENOMENAL VINYL CORP., RIM SOURCE MOTORSPORTS LLC, and FORGIATO INC., Defendants. Case No. 1:16-cv-06574-BMC FORGIATO INC.’S NOTICE OF MOTION TO DISMISS PURSUANT TO FEDERAL RULES OF CIVIL PROCEDURE, RULE 12(b)(1), (2) AND (6) [ORAL ARGUMENT REQUESTED] TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD: PLEASE TAKE NOTICE specially appearing FORGIATO, INC. (“Forgiato”) hereby moves the Court for an Order dismissing with prejudice Plaintiff CURTIS J. JACKSON, III’s Complaint (“Plaintiff”) against Forgiato. This Motion is brought pursuant to Federal Rules of Civil Procedure Rule 12(b)(1), (2) and (6) as the Court does not have jurisdiction over Forgiato, and Plaintiff fails to state a claim on which relief can be granted against Forgiato. Forgiato respectfully submits the Motion should be granted and the Complaint should be dismissed with prejudice as to Forgiato (because Plaintiff cannot truthfully allege any facts to remedy the defects) for the following reasons: (1) Plaintiff’s sole cause of action alleged against Forgiato - Unjust Enrichment - does not arise under federal law and is not preempted by the federal law claims alleged against the other Defendants; (2) The amount in controversy between Plaintiff and Forgiato cannot credibly be alleged to be in excess of $75,000; (3) Forgiato, a California corporation with its only place of business in California, does not have Case 1:16-cv-06574-BMC Document 36 Filed 02/15/17 Page 1 of 2 PageID #: 143 3290839.1 2 sufficient “minimum contacts” with New York such that being haled into a New York Court comports with “traditional notions of fair play and substantial justice”; (4) Forgiato’s business in New York is minimal in comparison to its overall sales, and is not substantial enough to justify jurisdiction over it in New York; (5) Plaintiff cannot obtain any relief on its unjust enrichment claim against Forgiato as there was no reliance or inducement such that benefits, if any, received by Forgiato could be considered unjust; and (6) As there is no original jurisdiction over Forgiato, the Court may not exercise supplemental jurisdiction to bring Forgiato into the forum state. This Motion is based on this Notice of Motion, the concurrently filed Memorandum of Points and Authorities, the Declarations of Norman Celik and Armen G. Mitilian filed concurrently herewith along with exhibits, all of the pleadings, files, and records in this proceeding, all other matters of which the Court may take judicial notice, and any argument or evidence that may be presented to or considered by the Court at the time of the hearing on this matter. Dated: February 15, 2017 Los Angeles, California FREEMAN, FREEMAN & SMILEY, LLP By: /s/ Armen G. Mitilian Armen G. Mitilian* (CA Bar No. 203191) Armen.Mitilian@ffslaw.com FREEMAN, FREEMAN & SMILEY, LLP 1888 Century Park East, Suite 1900 Los Angeles, California 90067 Telephone: (310) 255-6100 Facsimile: (310) 255-6200 * [admitted Pro Hac Vice 2/3/17 Dkt. 29] Attorneys for Forgiato, Inc. CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing was served on all parties through their counsel of record via ECF on this 15th day of February, 2017. By: /s/ Armen G. Mitilian Case 1:16-cv-06574-BMC Document 36 Filed 02/15/17 Page 2 of 2 PageID #: 144 3274475.6 22665-806 1 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK CURTIS J. JACKSON, III, Plaintiff, vs. PHENOMENAL VINYL CORP., RIM SOURCE MOTORSPORTS LLC, and FORGIATO INC., Defendants. Case No. 1:16-cv-06574-BMC MEMORANDUM OF LAW IN SUPPORT OF MOTION TO DISMISS SOLE CLAIM FOR UNJUST ENRICHMENT (SEVENTH CLAIM FOR RELIEF) PURSUANT TO FEDERAL RULES OF CIVIL PROCEDURE, RULE 12(b)(1), (2) AND (6) Dated: February 15, 2017 Los Angeles, California Armen G. Mitilian* (CA Bar No. 203191) Armen.Mitilian@ffslaw.com FREEMAN, FREEMAN & SMILEY, LLP 1888 Century Park East, Suite 1900 Los Angeles, California 90067 Telephone: (310) 255-6100 Facsimile: (310) 255-6200 * [admitted Pro Hac Vice 2/3/17 Dkt. 29] Attorneys for Forgiato, Inc. Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 1 of 24 PageID #: 145 3274475.6 22665-806 i TABLE OF CONTENTS Page I. INTRODUCTION ......................................................................................................................... 1 II. STATEMENT OF FACTS ............................................................................................................ 2 A. Summary of Facts Alleged in the Complaint. .................................................................... 2 B. Summary of Facts Regarding Forgiato. ............................................................................. 4 III. ARGUMENT ................................................................................................................................. 5 A. Plaintiff’s Claim for Unjust Enrichment Fails for Lack of Subject Matter Jurisdiction. ........................................................................................................................ 5 1. The Claim for Unjust Enrichment Against Forgiato does Not Arise Under a Federal Question. ................................................................................................ 6 2. Supplemental Jurisdiction is Not an Option as the Court does Not Have Original Jurisdiction Over Forgiato. ...................................................................... 8 3. The Amount in Controversy Between Plaintiff and Forgiato Does Not Exceed $75,000. ..................................................................................................... 9 B. There is no Personal Jurisdiction over Forgiato. ............................................................. 10 1. The Court’s Exercising Specific Personal Jurisdiction Over Forgiato Does Not Comport with the Federal Guarantee of Due Process. ........................ 10 2. As with Specific Personal Jurisdiction, There is No Basis to Find General Personal Jurisdiction. ........................................................................................... 13 C. The Claim for Unjust Enrichment Against Forgiato Fails to State a Claim on Which Relief May be Granted. ........................................................................................ 15 IV. CONCLUSION ............................................................................................................................ 17 Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 2 of 24 PageID #: 146 3274475.6 22665-806 ii TABLE OF AUTHORITIES Page(s) Cases Aquiline Capital Partners LLC v. Finarch LLC (S.D.N.Y. 2012) 861 F.Supp.2d 378.................................................................................................. 13 Arbaugh v. Y&H Corp. (2006) 546 U.S. 500 ........................................................................................................................... 10 Asahi Metal Indus. Co. v. Super. Ct. (1987) 480 U.S. 102 ........................................................................................................................... 12 Ashcroft v. Iqbal (2009) 556 U.S. 662 ........................................................................................................................... 15 Aurecchione v. Schoolman Transp. Sys., Inc. (2d Cir. 2005) 426 F.3d 635................................................................................................................. 6 Bank Brussels Lambert v. Fiddler Gonzalez & Rodriguez (2d Cir. 1999) 171 F.3d 779............................................................................................................... 11 Barbagallo v. Marcum LLP (E.D.N.Y. 2011) 820 F.Supp.2d 429 ................................................................................................. 17 Bell Atl. Corp. v. Twombly (2007) 550 U.S. 544 ........................................................................................................................... 15 Briarpatch Ltd., L.P v. Phoenix Pictures, Inc. (2d Cir. 2004) 373 F.3d 296................................................................................................................. 7 Bunge Italia, SPA v. Am. Exp. Bank Ltd. (S.D.N.Y. July 16, 2007) No. 07 CIV. 1785........................................................................................ 7 Burger King Corp. v. Rudzewicz (1985) 471 U.S. 462 ........................................................................................................................... 11 Calder v. Jones (1984) 465 U.S. 783 ........................................................................................................................... 11 Carlsbad Tech., Inc. v. HIF Bio, Inc. (2009) 556 U.S. 635 ............................................................................................................................. 8 Daimler AG v. Bauman (2014) 134 S.Ct. 746 ................................................................................................................... passim Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 3 of 24 PageID #: 147 3274475.6 22665-806 iii David LaChapelle v. Fred Torres (S.D.N.Y. 2014) 37 F.Supp.3d 672.................................................................................................. 8, 9 Frisone v. Pepsico Inc. (S.D.N.Y. 2005) 369 F.Supp.2d 464.................................................................................................... 6 Georgia Malone & Co. v. Rieder (2012) 19 N.Y.3d 511 .................................................................................................................. 16, 17 Goodyear Dunlop Tires Operations, S.A. v. Brown (2011) 564 U.S. 915 ........................................................................................................................... 14 Hanson v. Denckla (1958) 357 U.S. 235 ........................................................................................................................... 11 Helicopteros Nacionales de Colombia, S.A. v. Hall (1984) 466 U.S. 408 ........................................................................................................................... 13 Int’l Shoe Co. v. State of Wash., Office of Unemployment Comp. & Placement (1945) 326 U.S. 310 ........................................................................................................................... 11 J.L.B. Equities, Inc. v. Ocwen Fin. Corp. (S.D.N.Y. 2001) 131 F.Supp. 2d 544................................................................................................. 15 Jazini v. Nissan Motor Co., Ltd. (2d Cir. 1998) 148 F.3d 181............................................................................................................... 15 Keeton v. Hustler Magazine, Inc. (1984) 465 U.S. 770 ........................................................................................................................... 10 Kokkonen v. Guardian Life Ins. Co. of Am. (1994) 511 US 375 .......................................................................................................................................... 5 Longwood Res. Corp. v. C.M. Exploration Co. (S.D.N.Y. 1997) 988 F.Supp. 750, 752.............................................................................................. 13 Luckett v. Bure (2d Cir. 2002) 290 F.3d 493................................................................................................................. 6 Makarova v. U.S. (2d Cir. 2000) 201 F.3d 110................................................................................................................. 6 Mandarin Trading Ltd. v. Wildenstein (2011) 16 N.Y.3d 173, 182 ................................................................................................................ 16 In re Methyl Tertiary Butyl Ether (“MTBE”) Prod. Liab. Litig. (S.D.N.Y. 2007) 510 F.Supp.2d 299.................................................................................................... 8 Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 4 of 24 PageID #: 148 3274475.6 22665-806 iv Murphy v. 317-319 Second Realty LLC (2012) 95 A.D.3d 443 .................................................................................................................. 16, 17 Nowak v. Ironworkers Local 6 Pension Fund (2d Cir. 1996) 81 F.3d 1182................................................................................................................. 8 Penguin Grp. (USA), Inc. v. Am. Buddha (2d Cir. 2010) 609 F.3d 30................................................................................................................. 10 Perkins v. Benguet Consol. Mining Co. (1952) 342 U.S. 437 ........................................................................................................................... 14 Robinson v. Govt. of Malay (2d Cir. 2001) 269 F.3d 133................................................................................................................. 6 In re Roman Catholic Diocese of Albany, New York, Inc. (2nd Cir. 2014) 745 F.3d 30............................................................................................................... 14 Shipping Fin. Servs. Corp. v. Drakos (2d Cir. 1998) 140 F.3d 129................................................................................................................. 6 Stadt v. Fox News Network LLC (S.D.N.Y. 2010) 719 F.Supp.2d 312.......................................................................................... 7, 9, 16 Veneruso v. Mount Vernon Neighborhood Health Ctr. (S.D.N.Y. 2013) 933 F.Supp.2d 613, aff’d, 586 F.App’x 604 (2d Cir. 2014)..................................... 6 World-Wide Volkswagen Corp. v. Woodson (1980) 444 U.S. 286 ........................................................................................................................... 12 Statutes 15 U.S.C. § 1125(a)(1)(B) ......................................................................................................................... 9 28 U.S.C. § 1331 ........................................................................................................................................ 6 28 U.S.C. § 1332 ........................................................................................................................................ 9 28 U.S.C. § 1332(a) ................................................................................................................................... 9 28 U.S.C. § 1338(a) ................................................................................................................................... 7 28 U.S.C. § 1367(a) ................................................................................................................................... 8 Copyright Act (17 U.S.C. §§ 101 et seq.) .................................................................................................. 7 Lanham Act (15 U.S.C. §§ 1051 et seq.) ........................................................................................... 7, 8, 9 Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 5 of 24 PageID #: 149 3274475.6 22665-806 v Other Authorities Federal Rules of Civil Procedure Rule 12(b)(1) ........................................................................................ 1 Federal Rules of Civil Procedure Rule 12(b)(2) ........................................................................................ 1 Federal Rules of Civil Procedure Rule 12(b)(6) ........................................................................................ 1 Federal Rules of Civil Procedure Rule 12(b)(1) .................................................................................... 5, 6 Federal Rules of Civil Procedure Rule 12(b)(2) ...................................................................................... 10 Federal Rules of Civil Procedure Rule 12(h)(3) ...................................................................................... 10 Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 6 of 24 PageID #: 150 3274475.6 22665-806 1 I. INTRODUCTION Specially appearing Defendant Forgiato, Inc. (“Forgiato”) respectfully requests the Court dismiss the Complaint with prejudice as to Forgiato pursuant to Rule 12(b)(1), (2) and (6) of the Federal Rules of Civil Procedure1, because the Court lacks subject-matter jurisdiction and personal jurisdiction over Forgiato and because the Complaint fails to state a claim on which relief can be granted against Forgiato. Specifically, the sole Claim For Relief for Unjust Enrichment against Forgiato does not involve a federal question as the claim does not arise under federal law. The Court may not use its discretion to exercise supplemental jurisdiction with respect to unjust enrichment because the Court does not have original jurisdiction over Forgiato. Regardless, even if the Court had original jurisdiction, the principles of supplemental jurisdiction lead to the conclusion that the federal claims asserted against Defendant Phenomenal Vinyl Corp. (“PVC”) and Defendant Rim Source Motorsports LLC (“Rim Source”) and the state claim against Forgiato do not form “one case or controversy” such that they should be tried in a single judicial proceeding. This is because the evidence presented in support of the claims against PVC and Rim Source would be irrelevant and entirely different than the evidence presented in support of the unjust enrichment claim against Forgiato, and vice versa. Further, the dispute between Plaintiff Curtis J. Jackson, III (“Plaintiff”) and Forgiato does not meet the requirements of diversity as the amount in controversy cannot credibly exceed $75,000 based on common sense and Forgiato’s sales data. Therefore, there is no subject matter jurisdiction over Forgiato. In addition to lack of subject matter jurisdiction, Forgiato respectfully submits the Complaint should be dismissed against it because the Court lacks personal jurisdiction over Forgiato. Forgiato’s 1 All further references to Rules are to the Federal Rules of Civil Procedure unless otherwise indicated. Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 7 of 24 PageID #: 151 3274475.6 22665-806 2 forum-related activities are random and attenuated. Forgiato did not have any communications or contact with Plaintiff. Plaintiff was not given any contract, nor were there any negotiations between Plaintiff and Forgiato. Regardless, even taking as true that Plaintiff was given a contract with respect to Forgiato, the presentation of a contract to Plaintiff that was neither negotiated nor entered into does not constitute “purposeful activity” or “purposeful availment” such that Forgiato would reasonably expect to be haled into a New York court. Forgiato’s headquarters and its principal place of business are located Sun Valley, California. Forgiato’s business in New York is not “systematic and continuous.” Forgiato’s sales in New York have only been, at the highest, 2.9% of its gross sales in a year in the past 10 years. Further, Forgiato does not have any employees, agents, representatives, facilities or bank accounts in New York. Thus, Forgiato does not have sufficient “minimum contacts” with New York to satisfy federal due process requirements. As an additional ground on which the Complaint should be dismissed, Plaintiff fails to state a claim on which relief can be granted against Forgiato. The allegations in the Complaint, taken at face value, are not sufficient to meet the standard requiring restitution based on “equity and good conscience.” In particular, there are no allegations of reliance or inducement, which is fatal to an unjust enrichment claim (and there are no such allegations because Plaintiff cannot truthfully make such allegations). Consequently, there are no claims on which Plaintiff may recover from Forgiato. As set forth in greater detail herein, Forgiato respectfully requests the Court dismiss the Complaint with prejudice as against Forgiato as Plaintiff cannot remedy each of the defects. II. STATEMENT OF FACTS A. Summary of Facts Alleged in the Complaint. Plaintiff filed this action alleging unauthorized and willful use of his stage name and registered Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 8 of 24 PageID #: 152 3274475.6 22665-806 3 trademark “50 Cent”2 (the “Trademark”) contending PVC and Rim Source posted photographs of Plaintiff and/or Plaintiff’s vehicles, and referenced Plaintiff using the Trademark on their respective separate social media pages including Instagram. (Compl., ¶¶ 1, 23-28, 42, 51.) Plaintiff contends the posts were not only misleading, but deceptively conveyed to the public that he was promoting or endorsing PVC, Rim Source and Forgiato. (Id., ¶¶ 29, 45-46, 53.) Forgiato was not involved in the decision to make any of the posts and there is no allegation that Forgiato was so involved. In or about early 2016, Plaintiff contends he had PVC make modifications to his Rolls Royce. (Compl., ¶ 21.) Thereafter, PVC allegedly posted two photographs of the Rolls Royce on its Instagram page, and “tagged” Plaintiff, PVC and other entities, including Non-Party MetroStyling (“Metro”). (Id., ¶¶ 23, 25-26, 28, 31, fn. 3). Notably, neither of these posts “tagged” or identified Forgiato or its products. (Id., ¶¶ 21-29.) Later, in or about March 2016, PVC proposed to Plaintiff that it would customize his Bentley Mulsanne, including installing Forgiato wheels, in exchange for posts on Plaintiff’s social media “tagging” and giving “shout-outs” to PVC and Forgiato. (Compl., ¶ 31.) Plaintiff declined and requested PVC customize his Bentley Mulsanne without any such agreement. (Id., ¶ 32.) Plaintiff then purchased Forgiato wheels from a non-party distributor, who in turn obtained the wheels from Rim Source. (Id., ¶ 33.) The Forgiato wheels were installed onto Plaintiff’s vehicle by PVC. (Id., ¶ 34.) After the customizations were made to the Bentley Mulsanne, PVC allegedly posted a photograph of the vehicle on its Instagram page, and included in the caption that the car was “sitting on some @forgiato Wheels”. (Compl., ¶ 42.) Rim Source also posted a photograph on its website and its Instagram page of the Bentley Mulsanne along with a photograph of Forgiato’s wheels in a Forgiato 2 The trademark has been cancelled or invalidated, and has been removed from the United States Patent and Trademark Office registry as of January 13, 2017. (See Declaration of Armen G. Mitilian, Ex. A.) Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 9 of 24 PageID #: 153 3274475.6 22665-806 4 box. (Id.) Rim Source included captions stating the “BENTLEY #MULSANNE [is] DONE ON 24’ FORGIATO 3-PIECE WHEELS.” (Id.) Sometime thereafter, PVC allegedly provided Metro with a photograph of the Bentley Mulsanne, which Metro then posted on its Instagram page. (Compl., ¶ 51-52.) Forgiato was not “tagged” or mentioned in Metro’s post. (Id., ¶¶ 51-53.) B. Summary of Facts Regarding Forgiato. Forgiato is a manufacturer of custom wheels with its headquarters, principal (and only) place of business, and manufacturing facility in Sun Valley, California. (Declaration of Norman Celik (“Celik Decl.”), ¶ 2.) Forgiato does not have any offices, facilities, employees or bank accounts in New York, or any place other than California. (Id., ¶ 3.) Forgiato’s representatives and employees have not traveled to New York to conduct business on behalf of the company. (Id., ¶ 4.) On one occasion, which occurred in 2016, one of Forgiato’s employees travelled to New York for a personal vacation with his family at which time he visited a couple of wheel shops that sell Forgiato wheels. (Id.) Throughout the years, Forgiato has made minimal sales to dealers in New York. (See Celik Decl., ¶ 5.) Forgiato has only 5 dealers located in all of New York compared to 250 dealers it sells to nationwide. (Id.) Forgiato’s sales in New York compared to its gross sales for the past 10 years reflect the sales in New York are nominal, at best: 2017 - 0%; 2016 - 2.4%; 2015 - 2.9%; 2014 - less than 1%; 2013 - less than 1%; 2012 - less than 0.01%; 2011 - less than 0.5%; 2010 - 0.5%; 2009 - less than 0.5%; 2008 - 0.8%; 2007- 1%. (Id.) Forgiato does not direct any advertising to New York, does not directly seek business in New York, and does not direct its New York dealers on who to sell to or how to sell Forgiato wheels. (Id., ¶ 7.) Additionally, Forgiato does not handle service, installation or manufacturing issues with its end users. (Id., ¶ 8.) To the contrary, any retail customer with a warranty claim must make the claim through the authorized dealer that originally sold the wheel to the retail customer. (Id.) Forgiato did not seek Plaintiff’s business or endorsement of its wheels. (Celik Decl., ¶ 9.) Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 10 of 24 PageID #: 154 3274475.6 22665-806 5 Instead, one of Forgiato’s dealers, a non-party, contacted Forgiato regarding Plaintiff’s vehicle and a potential endorsement based on work the dealer might be hired to perform. (Id.) In connection therewith, the non-party asked Forgiato to provide its standard sponsorship contract as a sample to the dealer, and Forgiato sent to the dealer a contract that it used previously with a well-known athlete. (Id.) Importantly, Forgiato never directly communicated with Plaintiff or his representatives. (Id., ¶ 10.) No transaction occurred between Plaintiff, the non-party dealer and Forgiato, and an agreement between Forgiato and Plaintiff was not negotiated or even discussed between Plaintiff and Forgiato. (Id., ¶¶ 10- 11.) Subsequently, Plaintiff claims he arranged to purchase Forgiato wheels from a non-party distributor and to have PVC install the wheels. (Compl., ¶¶ 33-34.) Thus, Forgiato was not a part of the transaction for the wheels that Plaintiff ultimately purchased. A simple reading of the Complaint reflects Forgiato, PVC and Rim Source are separate entities located in entirely different parts of the country. (See Compl., ¶¶ 5-7.) Forgiato was not involved in any way in making the posts on PVC’s Instagram page and Rim Source’s website and Instagram page where Forgiato was “tagged” or mentioned. (Celik Decl., ¶¶ 12-13.) Forgiato did not and does not have any control or input over PVC’s business operations and social media, including the content on PVC’s Instagram page, and did not and does not have any control or input over Rim Source’s business operations website or Instagram page. (Id.) III. ARGUMENT A. Plaintiff’s Claim for Unjust Enrichment Fails for Lack of Subject Matter Jurisdiction. Federal courts are courts of limited jurisdiction, and may only adjudicate cases involving a federal question, diversity between the parties or to which the U.S. is a party. (See Kokkonen v. Guardian Life Ins. Co. of Am. (1994) 511 US 375, 377.) Rule 12(b)(1) provides for dismissal of a Complaint “for lack of subject matter jurisdiction Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 11 of 24 PageID #: 155 3274475.6 22665-806 6 …when the district court lacks the statutory or constitutional authority to adjudicate it.” (Makarova v. U.S. (2d Cir. 2000) 201 F.3d 110, 113, citing 28 U.S.C. § 1331.) The plaintiff bears the burden of proving by a preponderance of the evidence that subject matter jurisdiction exists. (Aurecchione v. Schoolman Transp. Sys., Inc. (2d Cir. 2005) 426 F.3d 635, 638, citing Luckett v. Bure (2d Cir. 2002) 290 F.3d 493, 497.) Jurisdictional allegations must be shown affirmatively and must appear on the face of the Complaint. (See Shipping Fin. Servs. Corp. v. Drakos (2d Cir. 1998) 140 F.3d 129, 131.) Jurisdiction may not be inferred favorably to the party alleging jurisdiction is proper because no presumptive truthfulness attaches to jurisdictional allegations. (Id.) Thus, “a facially sufficient complaint may be dismissed for lack of subject matter jurisdiction if the asserted basis for jurisdiction is not sufficient.” (Frisone v. Pepsico Inc. (S.D.N.Y. 2005) 369 F.Supp.2d 464, 469.) In determining whether jurisdiction is proper for purposes of a Rule 12(b)(1) Motion, the Court is not confined to evidence in the pleadings, and may refer to extrinsic evidence including affidavits. (See Luckett, supra, 290 F.3d at 496-97.) In fact, the Court must look beyond the Complaint “if resolution of a proffered factual issue may result in the dismissal…for [lack] of jurisdiction.” (Robinson v. Govt. of Malay (2d Cir. 2001) 269 F.3d 133, 141.) For the reasons set forth herein, there is no subject matter jurisdiction because the unjust enrichment claim does not involve a federal question, diversity jurisdiction is improper and the U.S. is not a party. 1. The Claim for Unjust Enrichment Against Forgiato does Not Arise Under a Federal Question. To meet the requirements of federal question jurisdiction, a claim must “aris[e] under the Constitution, laws, or treaties of the United States”. (28 U.S.C. § 1331; see Veneruso v. Mount Vernon Neighborhood Health Ctr. (S.D.N.Y. 2013) 933 F.Supp.2d 613, 618, aff’d, 586 F.App’x 604 (2d Cir. 2014).) Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 12 of 24 PageID #: 156 3274475.6 22665-806 7 The only claim against Forgiato is for unjust enrichment, which does not “aris[e] under the Constitution, laws, or treaties of the United States”. (See Bunge Italia, SPA v. Am. Exp. Bank Ltd. (S.D.N.Y. July 16, 2007) No. 07 CIV. 1785, *2, plaintiff only asserted one cause of action for unjust enrichment against defendant, which was not sufficient to meet the burden of establishing federal question jurisdiction.) Moreover, there is no federal question jurisdiction over Forgiato simply because Plaintiff alleges against PVC and Rim Source claims that arise out of the alleged use of the Trademark. (See 28 U.S.C. § 1338(a).) In other words, the unjust enrichment claim is not preempted by the Lanham Act (15 U.S.C. §§ 1051 et seq.). (See Stadt v. Fox News Network LLC (S.D.N.Y. 2010) 719 F.Supp.2d 312, 321-22.) Of guidance is the Court’s reasoning in Stadt, where plaintiff filed suit against the defendant asserting various of causes of action including copyright infringement and unjust enrichment. (Id. at 315.) The Court held the unjust enrichment claim was preempted by the Copyright Act (17 U.S.C. §§ 101 et seq.), because the alleged unjust enrichment was caused by the defendant that purportedly caused the wrongful use of the copyrighted material. (Id. at 320.) Simply put, the same defendant was the subject of both claims. (See id.) Stadt is similar to Briarpatch, infra, which Plaintiff cites in his letter opposition. (See Dkt. No. 26; see also Briarpatch Ltd., L.P v. Phoenix Pictures, Inc. (2d Cir. 2004) 373 F.3d 296.) In Briarpatch, the defendant that was haled into federal court under an unjust enrichment claim was the same party alleged to have conducted the wrongful act that caused the unauthorized use of the copyrighted material. (See Briarpatch, supra, 373 F.3d at 306-07.) The facts in Stadt and in Briarpatch are entirely different than here, where Plaintiff alleges wrongful conduct on the part of PVC and Rim Source, and has not alleged (and cannot truthfully allege) that the unjust enrichment was due to any wrongdoing on the part of Forgiato. (Compl. in general, but also ¶¶ 92-96.) Instead, Plaintiff alleges that PVC, Rim Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 13 of 24 PageID #: 157 3274475.6 22665-806 8 Source and Metro used the Trademark without consent. (Id., ¶¶ 23, 26, 42 and 51.) Therefore, the unjust enrichment claim asserted against Forgiato is not preempted by the federal claims alleged against PVC and Rim Source. 2. Supplemental Jurisdiction is Not an Option as the Court does Not Have Original Jurisdiction Over Forgiato. A Court must first have original jurisdiction over a party before it can determine whether to exercise supplemental jurisdiction. (See 28 U.S.C. § 1367(a); see also Carlsbad Tech., Inc. v. HIF Bio, Inc. (2009) 556 U.S. 635, 639-40, the Court may determine whether it will exercise supplemental jurisdiction only if it dismisses all of the claims on which it had original jurisdiction; see also Nowak v. Ironworkers Local 6 Pension Fund (2d Cir. 1996) 81 F.3d 1182, 1187, the district court may, at its discretion, exercise supplemental jurisdiction over state law claims only if there is first a proper basis for original federal jurisdiction.) Regardless of whether original jurisdiction exists, however, supplemental jurisdiction is proper only if the federal law claims, the state law claims and the related parties “form part of the same case or controversy under Article III of the…Constitution”. (28 U.S.C. § 1367(a); see In re Methyl Tertiary Butyl Ether (“MTBE”) Prod. Liab. Litig. (S.D.N.Y. 2007) 510 F.Supp.2d 299, 305.) Federal law and state law claims form “one case or controversy” if they “derive from a common nucleus of operative facts or when both claims would normally be expected to be tried in a single judicial proceeding.” (In re Methyl, supra, 510 F.Supp.2d at 321.) In David LaChapelle v. Fred Torres (S.D.N.Y. 2014) 37 F.Supp.3d 672, 677, a case with similar facts, the plaintiff celebrity commenced an action against his agent alleging the defendant violated the Lanham Act by reproducing the plaintiff’s images in which the plaintiff had an exclusive copyright. The defendant filed a third-party claim against an art gallery asserting a claim for unjust enrichment. (Id. at 675-76.) The Court held it lacked supplemental jurisdiction over the unjust enrichment cause of action because the necessary analysis regarding the unjust enrichment claim is Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 14 of 24 PageID #: 158 3274475.6 22665-806 9 separate and distinct from the plaintiff’s Lanham Act copyright claims against the defendant. (Id. at 687.) The LaChapelle Court reasoned it was irrelevant that the dispute between the agent and the art gallery arose out of the exhibition of the copyrighted material, because “[t]he facts necessary to prove [the unjust enrichment claim] [have] absolutely no connection to the evidence necessary to prove or defend against [p]laintiff[’]s federal claims.” (Id. at 687.) The LaChapelle analysis applies here. Plaintiff alleges against PVC and Rim Source violations of the Lanham Act for the alleged use of the Trademark (Compl., ¶¶ 54-60) and a claim for unjust enrichment against Forgiato (Compl., ¶¶ 92-96). For the reasons set forth in LaChapelle, the Court does not have supplemental jurisdiction over Forgiato because it never had original jurisdiction, and because the facts necessary to prove unjust enrichment [i.e., (1) Forgiato benefited; (2) at Plaintiff’s expense; and (3) equity and good conscience require restitution (Stadt, supra, 719 F.Supp.2d at 319)] have absolutely no connection to the violations of federal law and the Lanham Act3 asserted against PVC and Rim Source. (See LaChappelle, 37 F.Supp.3d at 677.) In other words, determining whether Forgiato benefited at Plaintiff’s expense, and equity and good conscience require restitution has absolutely no bearing on Plaintiff’s claims against PVC or Rim Source, including the evidence presented. (See Stadt, supra, 719 F.Supp.2d at 319.) Thus, Forgiato respectfully submits the Court may not exercise supplemental jurisdiction over Forgiato. 3. The Amount in Controversy Between Plaintiff and Forgiato Does Not Exceed $75,000. When lacking federal question jurisdiction, the Court may turn to 28 U.S.C. § 1332, which confers subject-matter jurisdiction over actions “where the matter in controversy exceeds the sum or value of $75,000….” (28 U.S.C. § 1332(a).) 3 The Lanham Act claims focus on the alleged improper use of a trademark. (15 U.S.C. § 1125(a)(1)(B).) Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 15 of 24 PageID #: 159 3274475.6 22665-806 10 The amount in controversy cannot (and does not) exceed $75,000 with respect to Forgiato as Forgiato’s sales in New York did not increase after the alleged posts by PVC and Rim Source of Plaintiff’s image and the Trademark. (See Celik Decl., ¶¶ 5-6.) The PVC and Rim Source social media posts identifying Forgiato are alleged to have been posted in or around March 2016. (See Compl. ¶¶ 30- 42.) Forgiato’s total sales in New York in 2015 were $395,485.44; this equates to approximately 79 sets of four wheels each. (Celik Decl., ¶ 6.) Thereafter, in 2016, after Forgiato was allegedly unjustly enriched from being identified on PVC’s and Rim Source’s social media posts with Plaintiff’s image and the Trademark, Forgiato’s sales dropped by more than $100,000 to $292,507.89; which equates to approximately 58 sets of four wheels each. (Id.) Thus, the amount in controversy cannot exceed even $0.01, and a dismissal is warranted. (See Arbaugh v. Y&H Corp. (2006) 546 U.S. 500, “If the court determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the action[]” [Rule 12(h)(3)]). B. There is no Personal Jurisdiction over Forgiato. On a motion to dismiss for lack of personal jurisdiction pursuant to Rule 12(b)(2), the plaintiff has the burden of alleging sufficient facts to support personal jurisdiction of a defendant. (Penguin Grp. (USA), Inc. v. Am. Buddha (2d Cir. 2010) 609 F.3d 30, 34.) A plaintiff must establish a basis for jurisdiction over each defendant in the action. (Keeton v. Hustler Magazine, Inc.(1984) 465 U.S. 770, 781 n.13.) Plaintiff fails to satisfy his burden as the Complaint does not contain a single factual allegation sufficient to confer personal jurisdiction over Forgiato. Instead, the uncontroverted facts establish there is no basis for personal jurisdiction over Forgiato. 1. The Court’s Exercising Specific Personal Jurisdiction Over Forgiato Does Not Comport with the Federal Guarantee of Due Process. “Specific jurisdiction[] encompasses cases in which the suit arises out of or relates to the Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 16 of 24 PageID #: 160 3274475.6 22665-806 11 defendant’s contacts with the forum[.]” (Daimler AG v. Bauman (2014) 134 S.Ct. 746, 748-49, internal citations and quotations removed.) The Court must determine whether the defendant has sufficient contacts or minimum contacts with the forum state “such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” (Int’l Shoe Co. v. State of Wash., Office of Unemployment Comp. & Placement (1945) 326 U.S. 310, 316.) The application of the “minimum contacts” test depends on the facts of each particular case. (Id. at 319; see also Calder v. Jones (1984) 465 U.S. 783, 790.) Specifically, the forum state must have a sufficient relationship with the defendant and the litigation to make it reasonable to require the defendant to defend the action in the federal court located in the state. (See Daimler, supra, 134 S.Ct. at 754.) The Court’s exercise of personal jurisdiction over Forgiato would not comport with Forgiato’s right to due process, because Forgiato’s contacts with New York are “random, fortuitous, [and] attenuated[,]” and/or are the unilateral activity of other entities over which Forgiato does not have control. (See Burger King Corp. v. Rudzewicz (1985) 471 U.S. 462, 475; see Bank Brussels Lambert v. Fiddler Gonzalez & Rodriguez (2d Cir. 1999) 171 F.3d 779, 784.) There are many reasons supporting the lack of personal jurisdiction over Forgiato. First, the claim against Forgiato does not arise out of Forgiato’s forum-related activities as the alleged posts to social media on the public internet were made by PVC and Rim Source, not by Forgiato. (Compl., ¶ 42.) Forgiato did not and does not have control over PVC or Rim Source. (Celik Decl., ¶¶ 12-13.) The potential endorsement agreement with Plaintiff was proposed to Forgiato by its dealer (not a party in this action), and not the result of Forgiato’s forum-related activities. (Id., ¶ 9.) Second, Forgiato did not purposefully direct activities toward Plaintiff or New York residents or purposefully avail itself of the privilege of conducting activities within New York. (See Hanson v. Denckla (1958) 357 U.S. 235, 253-54, citing Int’l Shoe, supra, 326 U.S. at 319.) Forgiato does not Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 17 of 24 PageID #: 161 3274475.6 22665-806 12 advertise in or specifically target businesses in New York. (Celik Decl., ¶ 7.) Therefore, Forgiato’s activities or contacts with New York are insufficient for the Court to exercise specific personal jurisdiction. Third, in addition to insufficient contact with New York, it is unreasonable to compel Forgiato to litigate this matter in New York. In addressing “reasonableness,” the Supreme Court of the United States has held the following factors must be evaluated: (1) the burden that the exercise of jurisdiction will impose on the defendant; (2) the interests of the forum state in adjudicating the case; (3) the plaintiff’s interest in obtaining convenient and effective relief; (4) the interstate judicial system’s interest in obtaining the most efficient resolution of the controversy; and (5) the shared interest of the states in furthering substantive social policies. (Asahi Metal Indus. Co. v. Super. Ct. (1987) 480 U.S. 102, 113.) Forgiato does not have any offices, facilities, employees, agents or representatives in New York. (Celik Decl., ¶ 3.) Moreover, New York does not have any interest in adjudicating the non- federal law unjust enrichment claim between a purported Connecticut Plaintiff and a California Defendant, and instead, should permit the proper forum to determine the issue. While Plaintiff may have an interest in obtaining convenient and effective relief, the other factors provided set forth in Asahi Metal heavily outweigh Plaintiff’s interest. (See Asahi Metal, supra, 480 U.S. at 113.) Forgiato will incur a substantial financial burden if forced to litigate in New York - continuing to incur fees to New York counsel in addition to its lead trial and longtime California counsel, and traveling from California to New York for hearings, depositions, and trial. Moreover, the Courts, which are already heavily burdened, should have little or no interest in a dispute between Plaintiff and Forgiato involving a single state law claim for unjust enrichment. In sum, Forgiato’s conduct and lack of connection with New York is such that it would not Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 18 of 24 PageID #: 162 3274475.6 22665-806 13 reasonably anticipate being haled into a New York court. (See World-Wide Volkswagen Corp. v. Woodson (1980) 444 U.S. 286, 297.) Accordingly, Forgiato respectfully submits the Court should dismiss the Complaint against Forgiato for lack of specific personal jurisdiction. (See Aquiline Capital Partners LLC v. Finarch LLC (S.D.N.Y. 2012) 861 F.Supp.2d 378, 385, “New York courts have granted defendant’s motion to dismiss where a plaintiff did ‘not allege facts sufficient to support the conclusion that defendants have performed acts by which they have purposely availed themselves of the benefits and protections of New York law[],’” quoting Longwood Res. Corp. v. C.M. Exploration Co. (S.D.N.Y. 1997) 988 F.Supp. 750, 752.) 2. As with Specific Personal Jurisdiction, There is No Basis to Find General Personal Jurisdiction. Courts formerly tended to routinely hold that a corporation was subject to general jurisdiction if it did “continuous and systematic” business in the forum state. (See Helicopteros Nacionales de Colombia, S.A. v. Hall (1984) 466 U.S. 408, 414-16.) In Daimler, however, the Supreme Court held “continuous and systematic” business is insufficient if the defendant corporation is neither incorporated in nor has its principal place of business in the forum state. Specifically, the Supreme Court concluded that to find general jurisdiction exists in every state in which a corporation engages in substantial, continuous and systematic course of business would be “unacceptably grasping”. (Daimler, supra, 134 S.Ct. at 760-61.) In Daimler, the plaintiffs sued Mercedes-Benz USA, an out-of-state corporation, in California for actions that took place in Argentina. (Daimler, supra, 134 S.Ct. at 748.) The defendant had multiple facilities and offices in California, was the largest supplier of luxury vehicles to the California market, and had $4.6 billion in California-based sales for just one year in question. (Id. at 767.) Nevertheless, the Court held the defendant was not subject to general personal jurisdiction in California because California was neither the defendant’s principal place of business nor where it was incorporated. (Id. at Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 19 of 24 PageID #: 163 3274475.6 22665-806 14 754-60.) Under Daimler, the focus is no longer on the magnitude of the defendant’s in-state contacts when analyzing general jurisdiction, but rather it is almost solely on the location of the principal place of business and where the defendant is incorporated. (See Daimler, supra, 134 S.Ct. at 767-68.) Thus, now the mere fact that a company’s products are regularly sold in the forum state does not itself subject the company to general personal jurisdiction with regard to claims that have no connection with that state. (See id. at 760-61.) Absent the higher required level of connections like being “at home” there, merely selling within the forum state is not sufficient. (See Goodyear Dunlop Tires Operations, S.A. v. Brown (2011) 564 U.S. 915.) As in Daimler, Forgiato is neither incorporated in New York nor is its principal place of business in New York. (Celik Decl., ¶ 2.) Forgiato’s principal place of business is in California, and it was incorporated in California. (Id.) Additionally, there are no exceptional circumstances that would subject Forgiato to general jurisdiction in New York. (See Perkins v. Benguet Consol. Mining Co. (1952) 342 U.S. 437, 447-48, exceptional circumstances during wartime when the defendant company’s Philippine mining operations were completely halted during the Japanese occupation, causing the company’s president to essentially run the business from his Ohio office.) Forgiato does not own any property or maintain any offices or facilities in New York, does not have any employees in New York and does not maintain any bank accounts in New York. (Celik Decl., ¶ 3.) Forgiato’s employees do not travel to New York for business, and Forgiato does not actively look for business in New York. (Id., ¶ 4.) In short, Forgiato’s presence in New York is minimal, at best, and certainly does not and has never risen to the level of “continuous and systematic” under any definition. (See id. at ¶¶ 2-5, 7; see also Daimler, supra, 134 S.Ct. at 758, general jurisdiction requires affiliations that are so “continuous and systematic” as to render the foreign corporation essentially at home in the forum state.) Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 20 of 24 PageID #: 164 3274475.6 22665-806 15 The Second Circuit’s approach to general jurisdiction is consistent with Daimler. (See In re Roman Catholic Diocese of Albany, New York, Inc. (2nd Cir. 2014) 745 F.3d 30, 39-41, as a result of Daimler, foreign corporations and so-called mega corporations will not be subject to general jurisdiction in a state, even if they do a massive amount of business there, unless they are incorporated or have their principal place of business in that state; see also Jazini v. Nissan Motor Co., Ltd. (2d Cir. 1998) 148 F.3d 181, 184, the presence of a subsidiary alone does not establish the parent company’s presence in the forum state, unless the subsidiary “does all the business that the parent company could do were it here by its own officials”; J.L.B. Equities, Inc. v. Ocwen Fin. Corp. (S.D.N.Y. 2001) 131 F.Supp. 2d 544, 548, in determining questions of general jurisdiction, courts focus on the existence of an office in New York, the solicitation of business in New York, the presence of bank accounts or other property in New York, and the presence of employees in New York.) Accordingly, Forgiato submits the Court does not have general jurisdiction over Forgiato. C. The Claim for Unjust Enrichment Against Forgiato Fails to State a Claim on Which Relief May be Granted. A motion to dismiss should be granted where a complaint fails to plead enough facts to state a claim that is plausible on its face. (Bell Atl. Corp. v. Twombly (2007) 550 U.S. 544, 570.) That is, “[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter” and must allege more than mere “labels and conclusions” or a “formulaic recitation” of the elements of a cause of action. (Ashcroft v. Iqbal (2009) 556 U.S. 662, 678, quoting Bell Atl. Corp., 550 U.S. at 570.) Instead, the Complaint must plead “factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” (Ashcroft, supra, 556 U.S. at 678, quoting Bell Atl. Corp., supra, 550 U.S. at 556.) The factual allegations must go beyond the level of mere speculation to be plausible. (Bell Atl. Corp., supra, 550 U.S. at 555-56.) “To prevail on an unjust enrichment claim [under New York law], [the] plaintiff must establish Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 21 of 24 PageID #: 165 3274475.6 22665-806 16 (1) that the defendant benefited; (2) at the plaintiff’s expense; and (3) that equity and good conscience require restitution.” (Stadt, supra, 719 F.Supp.2d at 319.) Without sufficient facts, conclusory allegations that fail to establish that a defendant was unjustly enriched at the expense of a plaintiff warrants dismissal. (Georgia Malone & Co. v. Rieder (2012) 19 N.Y.3d 511, 517.) Forgiato could not have benefited from the posts made by PVC and Rim Source. Simply put, there are no facts alleged or that can be credibly alleged to show that Forgiato obtained any benefit.4 Additionally, “it must…be pleaded and proven that the benefit conferring services were performed for the defendant, thereby resulting in defendant’s unjust enrichment.” (Murphy v. 317-319 Second Realty LLC (2012) 95 A.D.3d 443, 446.) “It is not enough that the defendant received a benefit from the activities of the plaintiff; if services were performed at the behest of someone other than the defendant, the plaintiff must look to that person for recovery.” (Id.) In Murphy, plaintiff renovated an apartment based on an agreement between himself and the prior owner of the apartment. Plaintiff filed suit against the current owner alleging unjust enrichment as a result of the renovations. (Murphy, supra, 95 A.D.3d at 443-44.) The court held plaintiff failed to state a cause of action for unjust enrichment because the “the pleadings failed to indicate a relationship between the parties that could have caused reliance or inducement.” (Id. at 446, citing Mandarin Trading Ltd. v. Wildenstein (2011) 16 N.Y.3d 173, 182.) Similarly, in Georgia Malone, supra, a licensed real estate brokerage and consulting firm, entered into an agreement to provide the defendant real estate company confidential information including financial projections, due diligence materials and other information relating to various 4 The use of the Trademark did not and would not correspond with any benefit as Plaintiff filed for bankruptcy in or around July 13, 2015, thereby destroying his image as a wealthy rapper people want to emulate, and admitted in his bankruptcy proceeding that online boasting of his wealth and image is staged and not real. (See U.S. Bankr. Ct., D. Ct. Case No. 15- 21233.) Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 22 of 24 PageID #: 166 3274475.6 22665-806 17 aspects of properties and potential transactions. (Georgia Malone & Co., supra, 19 N.Y.3d 511, 513- 14, cited by Barbagallo v. Marcum LLP (E.D.N.Y. 2011) 820 F.Supp.2d 429, 448.) The defendant real estate company then sold the information to another brokerage firm. (Georgia Malone & Co., supra, 19 N.Y.3d at 515.) The Court held plaintiff’s failure to allege that it relied on any statements or actions by the other brokerage firm to induce it to provide the confidential information to the defendant real estate company was fatal to its unjust enrichment claim against the third party. (See id. at 522-23.) Like the plaintiffs in Georgia Malone and Murphy, Plaintiff does not plead any alleged benefit conferred to Forgiato that was done at the behest of Forgiato. (See Compl. in general, but also ¶¶ 92- 96.) Instead, Plaintiff only alleges liability and responsibility on the part of PVC and Rim Source for the alleged re-posts of Plaintiff’s post to their respective social media platforms. (Id. at ¶ 42.) Tellingly, even more fatal to Plaintiff’s claim is that there are no factual allegations of reliance or inducement, including that Plaintiff relied on any representations made by Forgiato or that Forgiato induced Plaintiff to act in such a way that caused the alleged unjust enrichment. (See Compl. in general, but also ¶¶ 92- 96.) The simple fact is there are no such allegations because Plaintiff cannot truthfully allege reliance or inducement as to Forgiato as he did not at any time communicate with Forgiato about anything, including, PVC’s and Rim Source’s re-posting of images on their respective social media sites, which Forgiato did not have any knowledge of or control over. (Celik Decl., ¶¶ 12-13.) Thus, Forgiato respectfully submits Plaintiff’s claim for unjust enrichment against Forgiato fails and should be dismissed with prejudice. IV. CONCLUSION Based on the foregoing, Forgiato respectfully requests the Court grant this Motion and issue an Order dismissing with prejudice the Complaint (as Plaintiff cannot remedy each of the defects) as to Forgiato for the following reasons: (1) the sole cause of action alleged against Forgiato - Unjust Enrichment - does not arise under federal law and is not preempted by the federal law claims alleged Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 23 of 24 PageID #: 167 3274475.6 22665-806 18 against the other Defendants; (2) the amount in controversy between Plaintiff and Forgiato is not and cannot credibly be alleged to be in excess of $75,000; (3) Forgiato, a California corporation with its only place of business in California, does not have sufficient “minimum contacts” with New York such that being haled into a New York Court comports with “traditional notions of fair play and substantial justice”; (4) Forgiato’s business in New York is minimal in comparison to its overall sales, and is not substantial enough to justify jurisdiction over it in New York; (5) Plaintiff cannot obtain any relief on its unjust enrichment claim against Forgiato as there was no reliance or inducement such that benefits, of which there were none, received by Forgiato could be considered unjust; and (6) as there is no original jurisdiction over Forgiato, the Court may not exercise supplemental jurisdiction to bring Forgiato into the forum state. Dated: February 15, 2017 Los Angeles, California FREEMAN, FREEMAN & SMILEY, LLP By: /s/ Armen G. Mitilian Armen G. Mitilian* (CA Bar No. 203191) Armen.Mitilian@ffslaw.com FREEMAN, FREEMAN & SMILEY, LLP 1888 Century Park East, Suite 1900 Los Angeles, California 90067 Telephone: (310) 255-6100 Facsimile: (310) 255-6200 * [admitted Pro Hac Vice 2/3/17 Dkt. 29] Attorneys for Forgiato, Inc. CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing was served on all parties through their counsel of record via ECF on this 15th day of February, 2017. By: /s/ Armen G. Mitilian Case 1:16-cv-06574-BMC Document 36-1 Filed 02/15/17 Page 24 of 24 PageID #: 168 3290423.1 1 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK CURTIS J. JACKSON, III, Plaintiff, vs. PHENOMENAL VINYL CORP., RIM SOURCE MOTORSPORTS LLC, and FORGIATO INC., Defendants. Case No. 1:16-cv-06574-BMC DECLARATION OF ARMEN G. MITILIAN IN SUPPORT OF MOTION TO DISMISS SOLE CLAIM FOR UNJUST ENRICHMENT (SEVENTH CLAIM FOR RELIEF) PURSUANT TO FEDERAL RULES OF CIVIL PROCEDURE, RULE 12(b)(1), (2) AND (6) I, Armen G. Mitilian, declare: 1. I am an attorney duly licensed to practice before all of the courts in the State of California. I was admitted Pro Hac Vice to practice before this Court on February 3, 2017. [Dkt. 29.] I am a partner with Freeman, Freeman & Smiley, LLP, counsel of record for Specially Appearing Defendant Forgiato, Inc. (“Forgiato”) in this action. I have personal knowledge of the facts set forth in this Declaration, and if called as a witness, could and would competently testify to such facts under oath. 2. I make this Declaration in support of Forgiato’s Motion to Dismiss Pursuant to Federal Rules of Civil Procedure, Rule 12(b)(1), (2) and (6). 3. On February 15, 2017, at approximately 10 a.m., I accessed the United States Patent and Trademark Office, Trademark Electronic Search System via the URL: https://www.uspto.gov/trademarks-application-process/search-trademark-database. I used the Basic Word Mark Search (New User) Search Option, and entered “50 Cent” into the Search Term. From the results, I located and clicked on “Registration Number 3102330”. Plaintiff alleges in the Complaint he Case 1:16-cv-06574-BMC Document 36-2 Filed 02/15/17 Page 1 of 5 PageID #: 169 3290423.1 2 was issued United States Trademark Registration Number 3,102,330 for the mark “50 CENT”. I determined that the Trademark, identified by “Registration Number 3102330” has been cancelled, and has been removed from the United States Patent and Trademark Office registry as of January 13, 2017. A true and correct copy of a printout of the results of my search is attached hereto as Exhibit A. I declare under penalty of perjury under the laws of the United States of America, and the States of New York and California that the foregoing is true and correct. Executed February 15, 2017 at Los Angeles, California. /s/ Armen G. Mitilian Armen G. Mitilian Armen G. Mitilian* (CA Bar No. 203191) Armen.Mitilian@ffslaw.com FREEMAN, FREEMAN & SMILEY, LLP 1888 Century Park East, Suite 1900 Los Angeles, California 90067 Telephone: (310) 255-6100 Facsimile: (310) 255-6200 * [admitted Pro Hac Vice 2/3/17 Dkt. 29] Attorneys for Forgiato, Inc. CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing was served on all parties through their counsel of record via ECF on this 15th day of February, 2017. By: /s/ Armen G. Mitilian Case 1:16-cv-06574-BMC Document 36-2 Filed 02/15/17 Page 2 of 5 PageID #: 170 Case 1:16-cv-06574-BMC Document 36-2 Filed 02/15/17 Page 3 of 5 PageID #: 171 Case 1:16-cv-06574-BMC Document 36-2 Filed 02/15/17 Page 4 of 5 PageID #: 172 Case 1:16-cv-06574-BMC Document 36-2 Filed 02/15/17 Page 5 of 5 PageID #: 173 3288980.2 1 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK CURTIS J. JACKSON, III, Plaintiff, vs. PHENOMENAL VINYL CORP., RIM SOURCE MOTORSPORTS LLC, and FORGIATO INC., Defendants. Case No. 1:16-cv-06574-BMC DECLARATION OF NORMAN CELIK IN SUPPORT OF MOTION TO DISMISS SOLE CLAIM FOR UNJUST ENRICHMENT (SEVENTH CLAIM FOR RELIEF) PURSUANT TO FEDERAL RULES OF CIVIL PROCEDURE, RULE 12(b)(1), (2) AND (6) I, Norman Celik, declare: 1. I am one of the founders and shareholders, and the Chief Operations Officer of Specially Appearing Defendant Forgiato, Inc. (“Forgiato”). I have personal knowledge of the facts set forth in this Declaration, and if called as a witness, could and would competently testify to such facts under oath. 2. Forgiato is a manufacturer of custom wheels. Forgiato was formed in 2007, and incorporated in California with its headquarters, principal (and only) place of business, and manufacturing facility located in Sun Valley, California. 3. Forgiato has not had, does not currently have, any offices, facilities, employees or bank accounts in New York, or any place other than California. 4. Forgiato’s representatives and employees have not traveled to New York to conduct business on behalf of the company, except for one occasion in 2016 when one of Forgiato’s employees travelled to New York for a personal vacation with his family, at which time he visited a couple of wheel shops that sell Forgiato wheels. Case 1:16-cv-06574-BMC Document 36-3 Filed 02/15/17 Page 1 of 5 PageID #: 174 3288980.2 2 5. Forgiato has only 5 dealers located in all of New York compared to 250 dealers it sells to nationwide. In connection with obtaining information for Forgiato’s Motion to Dismiss, I reviewed Forgiato’s records to determine sales revenue in New York compared to Forgiato’s total sales. Forgiato’s sales in New York for the past ten years since operations began compared to total sales are: Year Total Sales Total New York Sales Percentage of New York Sales Compared to Total Sales 2017 $0 0%; 2016 $12,032,719.75 $292,507.89 2.4% 2015 $13,326,328.61 $395,485.44 2.9% 2014 $12,157,249.71 $98,910.00 .81% 2013 $11,671,365.15 $87,946.10 .75% 2012 $11,929,419.76 $1,668.18 0.014% 2011 $10,433,087.65 $48,110.00 0.46% 2010 $7,797.953.97 $46,200.00 0.5% 2009 $5,432,118.08 $21,599.00 0.4% 2008 $6,230,676.88 $53,649.00 0.8% 2007 $4,856,976.23 $53,403.71 1.1% 6. Forgiato generally sells wheels in sets of 4. While the costs of Forgiato wheels are different based on size and style, a general conservative estimate for a set of 4 wheels is approximately $5,000, or $1,250 per wheel. Thus, Forgiato’s total sales in New York in 2015, $395,485.44, equates to approximately 79 sets of wheels ($395,485.44 / $5,000). Using this formula, Forgiato sold approximately 58 sets of wheels ($292,507.89 / $5,000) in New York in 2016. 7. Forgiato does not direct any advertising to New York, does not directly seek business in New York, and does not direct its New York dealers on who to sell to or how to sell Forgiato wheels. 8. Forgiato does not handle service, installation or manufacturing issues with its end users. Case 1:16-cv-06574-BMC Document 36-3 Filed 02/15/17 Page 2 of 5 PageID #: 175 3288980.2 3 Any retail customer with a warranty claim for Forgiato wheels must make the claim through the authorized dealer that originally sold the wheel to the retail customer. 9. Forgiato did not seek Plaintiff Curtis J. Jackson, III’s (“Plaintiff”) business or endorsement of its wheels. Instead, one of Forgiato’s dealers, a non-party, contacted Forgiato regarding Plaintiff’s vehicle and a potential endorsement based on work the dealer might be hired by Plaintiff to perform. The non-party asked Forgiato to provide its standard sponsorship contract as a sample to the dealer, and Forgiato sent to the dealer a contract that it used previously with a well-known athlete. 10. Neither I, nor anyone else on behalf of Forgiato, entered into any negotiations regarding the standard sponsorship contract with Plaintiff or anyone on behalf of Plaintiff. Neither I, nor anyone else on behalf of Forgiato ever directly communicated with Plaintiff or his representatives. I know this because as the Chief Operations Officer, some of my duties include overseeing and being involved in communications with athletes, musicians and celebrities in general. Forgiato wheels are popular with athletes, musicians and celebrities and wealthy individuals who like to modify their automobiles with custom made three-piece wheels. 11. At no time did Forgiato enter into any transaction with Plaintiff directly, or indirectly through Forgiato’s non-party dealer or any other third party. 12. Forgiato was not involved in any way in making the post on Defendant Phenomenal Vinyl Corp.’s (“PVC”) Instagram page referenced in Paragraph 42 of the Complaint where Forgiato was “tagged” or mentioned. Forgiato did not, has never had, and does not have, any input or control over PVC’s business operations and social media, including the posting of content on PVC’s Instagram page or any other social media platform used by PVC. In addition, PVC is not a Forgiato dealer. 13. Forgiato was not involved in any way in making the posts on Defendant Rim Source’s (“Rim Source”) website and Instagram page referenced in Paragraph 42 of the Complaint where Case 1:16-cv-06574-BMC Document 36-3 Filed 02/15/17 Page 3 of 5 PageID #: 176 Case 1:16-cv-06574-BMC Document 36-3 Filed 02/15/17 Page 4 of 5 PageID #: 177 3288980.2 5 CERTIFICATE OF SERVICE I HEREBY CERTIFY that a true and correct copy of the foregoing was served on all parties through their counsel of record via ECF on this 15th day of February, 2017. By: /s/ Armen G. Mitilian Case 1:16-cv-06574-BMC Document 36-3 Filed 02/15/17 Page 5 of 5 PageID #: 178 3290875.1 1 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK CURTIS J. JACKSON, III, Plaintiff, vs. PHENOMENAL VINYL CORP., RIM SOURCE MOTORSPORTS LLC, and FORGIATO INC., Defendants. Case No. 1:16-cv-06574-BMC [PROPOSED] ORDER GRANTING FORGIATO, INC.’S MOTION TO DISMISS SOLE CLAIM FOR UNJUST ENRICHMENT (SEVENTH CLAIM FOR RELIEF) PURSUANT TO FEDERAL RULES OF CIVIL PROCEDURE, RULE 12(b)(1), (2) AND (6) After considering the papers filed in support of and in opposition to Forgiato, Inc.’s (“Forgiato”) Motion to Dismiss Sole Claim for Unjust Enrichment (Seventh Claim For Relief) Pursuant to Federal Rules of Civil Procedure, Rule 12(b)(1), (2) and (6) (“Motion”), the argument of counsel, and good cause appearing therefor, the Court finds: 1. The Court does not have subject matter jurisdiction over Forgiato in this action; 2. The Court does not have personal jurisdiction over Forgiato in this action; 3. The Complaint filed by Plaintiff Curtis J. Jackson, III against Forgiato fails to state a claim upon which relief may be granted with respect to Forgiato; 4. The Complaint is dismissed with prejudice as to Forgiato; 5. Forgiato is entitled to recover its costs of suit. Accordingly, IT IS HEREBY ORDERED Forgiato’s Motion is granted. IT IS SO ORDERED. Dated: ______________________ Honorable Brian M. Cogan United States District Judge Case 1:16-cv-06574-BMC Document 36-4 Filed 02/15/17 Page 1 of 1 PageID #: 179