Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_15-cv-01107/USCOURTS-cand-3_15-cv-01107-0/pdf.json

Nature of Suit Code: 840
Nature of Suit: Trademark
Cause of Action: 15:1125 Trademark Infringement (Lanham Act)

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UNITED STATES DISTRICT COURT 

SOUTHERN DISTRICT OF NEW YORK 

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BHH LLC and E. MISHAN & SONS, INC., 

Plaintiffs, 

- against -

KENU, INC., 

Defendant. 

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14 Civ. 7265 (LLS) 

OPINION & ORDER 

Plaintiffs BHH LLC ("BHHn) & E. Mishan & Sons, Inc. 

("Mishann) sell "Clever Gripn phone mounts that attach to car 

air vents and allow drivers to keep their smartphones in sight 

while driving, which compete with mounts sold by defendant Kenu. 

Kenu sent a cease-and-desist letter to a licensee of plaintiffs, 

demanding that it and BHH stop selling BHH's product, claiming 

it infringes Kenu's "AIRFRAMEn product's design patent and trade 

dress. Kenu also sent an email to non-party Amazon, stating 

that the Clever Grip violates Kenu's design patent. 

Plaintiffs bring this declaratory judgment action, alleging 

that that the email and cease-and-desist letter harmed their 

business and goodwill, and asserting claims for tortious 

interference with advantageous business relations and unfair 

competition. 

Kenu moves for dismissal of the complaint for lack of 

personal jurisdiction and improper venue, or transfer of the 

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case to the United States District Court for the Northern 

District of California for the convenience of the parties and 

witnesses, pursuant to 28 U.S.C. § 1404(a). 

For the reasons that follow, Kenu's motion to transfer is 

granted. 

BACKGROUND 

BHH owns the trademark "Bell +Howell," under which it 

sells various products, including the Clever Grip. Compl. ~~ 8-

9. BHH is a New York limited liability company with its 

principal place of business in New York, New York. Id. ~ 1. 

Mishan is a Clever Grip distributor. Id. ~ 15. It is a New 

York corporation with its principal place of business in New 

York, New York. Id. ~ 2. 

Kenu manufactures and sells the AIRFRAME. Id. ~ 20. Kenu 

is a Delaware corporation with its only place of business in San 

Francisco, California. Id. ~ 3. 

On August 28, 2014, Kenu's attorneys sent a letter to the 

New York City office of non-party Elite Brands, Inc. Elite 

Brands is a licensee of BHH to sell certain Bell + Howell 

branded products, but it is not licensed to sell the Clever 

Grip. The letter stated: 

This letter is sent to inform you that we believe that the 

offer for sale of the Bell + Howell Clever Grip Air Vent 

Phone Mount, model 9434, is likely a violation of Kenu's 

valuable patent and trade dress rights related to its 

AIRFRAME~ product. This letter constitutes Kenu's demand 

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that Bell + Howell and Elite Brands, Inc. cease and desist 

making, importing, selling or offering for sale of the 

Clever Grip products in the United States. 

* * * * * 

Kenu is the legal owner of multiple design patents 

globally, including United States Design Patent D690,707, 

which we believe covers the items offered for sale by Bell 

+ Howell and Elite Brands, Inc. under the name Clever Grip 

Air Vent Phone Mount. A copy of Kenu's United States 

design patent registration is included with this 

correspondence. 

Moreover, the trade dress associated with Kenu's AIRFRAME= 

product is distinctive, non-functional, and is owned by 

Kenu. The trade dress associated with Kenu's AIRFRAME= 

product signifies the source of the AIRFRAME= product to 

its customers. As a result of considerable efforts, Kenu's 

customers, and the general public, have come to recognize 

Kenu as an established and successful mobile phone 

accessory business. 

Id. Ex. 3, at 1-2. The letter closed with: 

Please indicate by return letter your receipt of this 

correspondence and Bell+ Howell and Elite Brands, Inc.'s 

compliance with the demands contained herein. If you or 

your attorneys have any questions, please feel free to 

contact me. 

Id. at 3. 

On the same day, Kenu sent an e-mail to Amazon that stated: 

We are the owners and brand manufacturers of the Kenu 

Airframe (ASIN: BOOD901B4W) and (Design Patent Number: 

690707). We have registered our brand under the registry 

KENU, INC. 

The following products below violates our design patent and 

are using our brand images to sell an imitation product. 

We kindly request Amazon remove these listings from your 

catalog. 

Id. Ex. 4, at 1. 

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The following day, on August 29, 2014, Amazon forwarded 

Kenu's e-mail to Mishan. Id. ~ 40. Amazon requested that 

Mishan "provide us written confirmation that, in the event 

Amazon is required to participate, E. Mishan & Sons, Inc. will 

defend and indemnify Amazon in this matter." Id. Ex. 5, at 1. 

The Complaints 

Plaintiffs BHH and Mishan allege: 

46. On information and belief, Kenu's claims of trade 

dress claim and brand images are couched in intentionally 

vague and imprecise language and omit factual details in 

order to mislead and intimidate licensees and customers of 

BHH and Emson by obfuscating the lack of merit of Kenu's 

claims. 

47. On information and belief, Kenu has disparaged the 

Bell + Howard Clever Grip air vent holder as an imitation 

product in order to impugn the quality of the product. 

48. The appearance of the Bell + Howell Clever Grip air 

vent phone holder differs from the appearance of the Kenu 

Airframe product. 

49. The surface ornamentation, overall shape, and shapes 

of the individual elements of the Bell + Howell Clever Grip 

air holder differ from the corresponding elements of Kenu 

Airframe product and the design illustrated in the drawings 

of Kenu's design patent 0690,707. 

50. On information and belief, the plainly dissimilar 

appearance of the Bell + Howell Clever Grip air vent phone 

mount and the patented design shown in the drawings of 

Kenu's design patent 0690,707 are immediately apparent to 

an ordinary observer. 

51. Kenu's design patent infringement claims are not made 

in good faith. 

52. Kenu maliciously, or at least with gross recklessness, 

has published false and misleading statements of fact by 

sending them to Elite Brands, Inc. in New York City and 

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Amazon with intent to harm the interests of BHH and Emson, 

or [sic] which Kenu either recognized or should have 

recognized are likely harm [sic] the interests of BHH and 

Emson. 

53. Kenu's statements to Elite Brands, Inc. and Amazon are 

couched in terms of "trade dressu and "brand imagesu 

without specific identification of such to unfairly 

intimate that the Bell + Howell Clever Grip air vent phone 

holder violates its alleged trade dress. 

54. Kenu's conduct has caused and continues to cause 

irreparable harm and damages to BHH and Emson, including 

but not limited to the following: 

a. Significant harm to their goodwill, business 

reputations and the reputation of the Clever Grip 

goods which they provide to customers and licensees. 

b. Interference of their business with Amazon requiring 

Emson, a business corporation, to undertake the 

burdens and risks of defense obligations and 

indemnification obligations which would not 

otherwise be required in the ordinary course of 

business, except for the actions of Kenu. 

c. Disparagement of the Bell + Howell Clever Grip air 

vent phone holder. 

Id. ~~ 46-47, 51-54. 

Plaintiffs BHH and Mishan filed this action on September 9, 

2014. See Compl., Dkt. No. 1. 

Approximately two weeks later, on September 25, 2014, Kenu 

filed a complaint in the Northern District of California 

alleging that BHH and Mishan had infringed the same patent and 

trade dress rights it claimed in its cease-and-desist letter and 

e-mail. Kenu, Inc. v. BHH LLC et al., Case No. 3:14-cv-04327. 

On October 7, 2014, United States District Judge James Donato 

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held that case was related to another action filed on September 

10, 2014 in that Court by Kenu against eBay and counterfeiters 

selling imitation products on eBay's website. See Kenu's Motion 

to Transfer at 14; Crockett Decl. Exs. A and B. 

BHH and Mishan filed a motion to dismiss parts of Kenu's 

California action on October 23, 2014. See Crockett Supp. Decl. 

Ex. A. The Northern District of California has stayed Kenu's 

action against BHH and Mishan there "in its entirety" pending 

the outcome of the present motion Kenu filed in this Court on 

October 28, 2014, seeking dismissal or transfer to California of 

this case. Minute Order of Hon. James Donato, January 21, 2015 

in Civil Action C-14-04327-JD. 

DISCUSSION 

BHH and Mishan argue that their action in this Court should 

not be transferred to California because it should have priority 

under the "first-filed" rule. 

Kenu contends that the first-filed rule does not control, 

because this suit is a declaratory judgment action brought in 

unseemly anticipation of the filing of Kenu's substantive 

litigation in California, where it should be sent. 

The First-Filed Rule and its Exceptions 

"The first-filed rule states that, in determining the 

proper venue, where there are two competing lawsuits, the first 

suit should have priority." N.Y. Marine & Gen. Ins. Co. v. 

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Lafarge N. Am., Inc., 599 F.3d 102, 112 (2d Cir. 2010) (citation 

omitted). But there are salient exceptions. 

The Second Circuit has explained: 

We have recognized only two exceptions to the first-filed 

rule: (1) where the "balance of convenience" favors the 

second-filed action, see, e.g., Motion Picture Lab. 

Technicians Loc. 780, 804 F.2d at 19; Remington Prods. 

Corp. v. Am. Aerovap, Inc., 192 F.2d 872, 873 (2d Cir. 

1951), and (2) where "special circumstances" warrant giving 

priority to the second suit, see, e.g., First City Nat'l 

Bank, 878 F.2d at 79. 

* * * * * 

In applying the "balance of convenience" exception, we have 

considered the ties between the litigation and the forum of 

the first-filed action. See Motion Picture Lab Technicians 

Loc. 780, 804 F.2d at 19. We agree with several district 

courts within our Circuit that the "factors relevant to the 

balance of convenience analysis are essentially the same as 

those considered in connection with motions to transfer 

venue pursuant to 28 U.S.C. § 1404(a) ." Everest Capital 

Ltd. v. Everest Funds Mgmt., L.L.C., 178 F. Supp. 2d 459, 

465 (S.D.N.Y. 2002). Among these factors are: 

(1) the plaintiff's choice of forum, (2) the 

convenience of witnesses, (3) the location of relevant 

documents and relative ease of access to sources of 

proof, ( 4) the convenience of the parties, ( 5) the 

locus of operative facts, (6) the availability of 

process to compel the attendance of unwilling 

witnesses, [and] (7) the relative means of the 

parties. 

D.H. Blair & Co. v. Gottdiener, 462 F.3d 95, 106-07 (2d 

Cir. 2006) (quoting Albert Fadem Trust v. Duke Energy 

Corp., 214 F. Supp. 2d 341, 343 (S.D.N.Y. 2002)) 

(alterations in original). A balance of these factors will 

identify the more appropriate forum. 

Given the centrality of the balance of convenience, the 

"special circumstances" in which a district court may 

dismiss the first-filed case without this analysis are 

quite rare. In fact, we have identified only a limited 

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number of such circumstances. One exists where the firstfiled lawsuit is an improper anticipatory declaratory 

judgment action. See Factors Etc., Inc., 579 F.2d at 219 

(holding that the district court properly allowed laterfiled suit to proceed because first-filed declaratory 

judgment suit was triggered by notice letter and was 

therefore "in apparent anticipation of [the later-filed 

suit]"). District courts in this Circuit have recognized 

that, in order for a declaratory judgment to be 

anticipatory, it must be filed in response to a direct 

threat of litigation that gives specific warnings as to 

deadlines and subsequent legal action. See, e.g., Reliance 

Ins. Co. v. Six Star, Inc., 155 F. Supp. 2d 49, 55 

(S.D.N.Y. 2001); Fed. Ins. Co. v. May Dep't Stores Co., 808 

F. Supp. 347, 350 (S.D.N.Y. 1992). Another special 

circumstance is "where forum shopping alone motivated the 

choice of the situs for the first suit." William Gluckin & 

Co. v. Int'l Playtex Corp., 407 F.2d 177, 178 (2d Cir. 

1969) (emphasis added). This does not mean that any 

evidence of forum shopping will suffice. Any lawyer who 

files a case on behalf of a client must consider which of 

the available fora might yield some advantage to his 

client, and thus, to that degree, engages in "forum 

shopping." Rather, the first-filing plaintiff must engage 

in some manipulative or deceptive behavior, or the ties 

between the litigation and the first forum must be so 

tenuous or de minimis that a full "balance of convenience" 

analysis would not be necessary to determine that the 

second forum is more appropriate than the first. Where 

special circumstances are not present, a balancing of the 

conveniences is necessary. 

Employers Ins. of Wausau v. Fox Entertainment Group, Inc., 522 

F.3d 271, 275-76 (2d Cir. 2008) (footnotes omitted) (brackets in 

original). 

Application to this Case 

The considerations set forth above justify departure from 

the first-filed rule and favor transfer of this case to 

California. 

Because this is a declaratory judgment action, this Court's 

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jurisdiction is not mandatory but discretionary. See Muller v. 

Olin Mathieson Chern. Corp., 404 F.2d 501, 505 (2d Cir. 1968) 

("Nevertheless, we point out that even when justiciability is 

present the court is not required to proceed with the 

declaratory judgment action, for it is well settled that a trial 

court's decision to exercise declaratory jurisdiction is a 

discretionary one.). It is the Northern District of California 

court which will have mandatory subject-matter jurisdiction over 

these cases. 

The section 1404(a) factors defining the balance of 

convenience are in rough equilibrium. What compel transfer to 

California are a) that jurisdiction in New York over Kenu is not 

beyond doubt, b) that this case is recognized by the California 

court as related to litigation pending there in which BHH and 

Mishan have already appeared, c) that transfer to California 

will mean witnesses will testify in only one court (California) 

rather than two (California and New York) and d) it is apparent 

that this action was stimulated by the cease-and-desist letter, 

with its peremptory demand that Bell + Howell and Elite Brands, 

Inc. indicate, by return mail, their "compliance with the 

demands contained herein." 

Accordingly, the motion to transfer is granted and this 

action is transferred to the Northern District of California. 

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CONCLUSION 

Kenu's motion to transfer this action pursuant to 28 U.S.C. 

§ 1404 (Dkt. No. 10) is granted. 

The Clerk is directed to transfer this case to the United 

States District Court for the Northern District of California. 

So ordered. 

Dated: New York, New York 

February 27, 2015 

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{,.~ L .st-...44.. 

LOUIS L. STANTON 

U.S.D.J. 

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