Motions to Dismiss

Southern District Judge Schools Jekyll Island on Civil Procedure Basics when Dismissing All Claims in Trademark Dispute Involving Summer Waves Water Park

Jekyll Island-State Park Authority v. Polygroup Macau Limited, Civil Action No. 2:21-cv-00008-LGW-BWC (S.D. Ga., Mar. 24, 2023)

A trademark dispute between Plaintiff Jekyll Island-State Park Authority (JISPA) and Defendant Polygroup Macau Limited has been dismissed in the Southern District. The didactic ruling granted the Defendant’s motion to dismiss for lack of personal jurisdiction, finding that Polygroup does not have sufficient minimum contacts with Georgia to confer specific or general jurisdiction.

In brief, the trademark dispute  involves JISPA’s claim to the mark “SUMMER WAVES” for Entertainment Services under Class 41. Jekyll Island-State Park Authority v. Polygroup Macau Ltd. C.A No. 2:21-cv-00008-LGW-BWC (“Jekyll Island”), Dkt. 1 at 5 (S.D. Ga. Jan. 22, 2021).  For over three decades, JISPA operated the Summer Waves Water Park, an 11-acre water park located on Jekyll Island, and a website and online store at Id. at 4, 7. JISPA alleges that following Polygroup’s rejected offer to purchase the domain name, JISPA learned Polygroup had obtained without authorization three trademark registrations for SUMMER WAVES for inflatables under Class 28.

In its Motion to Dismiss for Lack of Jurisdiction, Polygroup argues that it is not subject to personal jurisdiction because Georgia’s long-arm statute does not reach them, and that exercising such personal jurisdiction over them would violate due process. Dkt. 47 at 10-19. In their Response, Plaintiff seemingly conceded this point, but countered that Rule 4(k)(2) authorizes general jurisdiction over Polygroup because the defendant is not otherwise subject to jurisdiction in any state’s courts of general jurisdiction. See Dkt. 51 at 6–20; Dkt. 65 at 2–6.

In the 52-page ruling, Judge Lisa Godbey Wood provides an in-depth review of subject matter jurisdiction, state-centered specific and general personal jurisdiction, and nationwide specific and general personal jurisdiction. Carefully applying these civil procedure concepts, the Court found it lacked personal jurisdiction over Polygroup as to each of JISPA’s claims.

First, the Court found that Polygroup does not have sufficient minimum contacts with the State to confer specific or general jurisdiction. In particular, the Court analyzed both specific and general jurisdiction, including a deep analysis of Georgia’s Long-Arm Statute and the Fourteenth Amendment’s Due Process clause.

Next, the Court analyzed the Plaintiff’s argument that, despite lack of minimum contacts with the State, Rule 4(k)(2) should apply. Federal Rule 4(k)(2) permits a court to exercise personal jurisdiction over a claim that arises under federal law if, “(A) the defendant is not subject to jurisdiction in any state’s courts of general jurisdiction; and (B) exercising jurisdiction is consistent with the United States Constitution and laws.”

The Court outright dismissed without prejudice the Plaintiff’s state common law trademark and unfair competition claims because they failed to arise under federal law. Then, the Court analyzed the remaining federal claims. For Polygroup’s trademark cancellation counterclaim, Section 37 of the Lanham Act grants district courts the power to cancel a trademark registration, a claim which can be heard in the Eastern District of Virginia. Since Rule 4(k)(2)(A) is therefore not satisfied, the Court dismissed the trademark cancellation claim without prejudice.

For JISPA’s remaining federal claims, however, the Court found that despite satisfying Rule 4(k)(2)’s first hurdle, they could not clear the second hurdle. Rule4(k)(2)(B) requires the exercise of jurisdiction to be consistent with the Constitution, and the Court clarified “consistent with” to mean “that which comports with due process.” Dkt. 68, citing Consol. Dev. Corp. v. Sherritt, Inc., 216 F.3d 1286, 1291 (11th Cir. 2000). Despite finding jurisdiction consistent with the law, the Court found JISPA’s claims did not arise from or relate to Polygroup’s contacts with the state due to the attenuated causal connection between registration and licensing to satisfy Rule 4(k)(2) under specific jurisdiction.

JISPA also unsuccessfully argued that the Court could exercise general jurisdiction under Rule 4(k)(2) based on Polygroup’s US-based trademark activities, including agreements, assignments, lawsuits, and monitoring. Relying on 11th Circuit precedent emphasizing a nonresident corporation’s contacts with the forum state must be more than sporadic or limited, the Court dismissed this and an alternative “alter-ego” theory, to find the Rule 4(k)(2) analysis failed to show general jurisdiction over Polygroup.

Because the Court lacked personal jurisdiction over Polygroup as to each of JISPA’s claims, Polygroup’s renewed motion to dismiss was granted, and JISPA’s claims were dismissed without prejudice. With no claims remaining in the action, Judge Wood directed the Clerk to close the case.

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