Free Transfer Document - District Court of California - California

Case 3:08-cv-01493-JM-BLM

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1 AMY WINTERSHEIMER FINDLEY (BAR NO. 163074) MICHAEL R. ADELE (BAR NO. 138339) 2 CHARLENE J. WILSON (BAR NO. 222497) ALLEN MATKINS LECK GAMBLE MALLORY & NATSIS LLP 3 501 West Broadway, 15th Floor 4 San Diego, California 92101-3541 Phone: (619) 233-1155 5 Fax: (619) 233-1158 E-Mail: [email protected] [email protected] 6 [email protected] 7 Attorneys for Defendant 8 BIORX, LLC 9 10 11 12 NUTRISHARE, INC., a California corporation, Case No. 2:08-cv-01252-WBS-EFB 13 14 v. Plaintiff, Complaint filed June 4, 2008 DEFENDANT'S EX PARTE APPLICATION FOR CONTINUANCE OF HEARING DATE ON PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION UNITED STATES DISTRICT COURT EASTERN DISTRICT OF CALIFORNIA

15 BIORX, LLC, an Ohio Limited Liability Company, 16 Defendant. 17 18

Pursuant to Federal Rule of Civil Procedure 6(b)(1)(A) and Local Rules 6-144 and 78-

19 230(g), Defendant BioRx, LLC ("Defendant" or "BioRx") applies to this Court ex parte for an 20 order continuing the hearing date on Plaintiff's Motion for Preliminary Injunction, which is 21 presently set for August 4, 2008 at 2:00 p.m., and for a corresponding extension of time for 22 Defendant to file and serve its Opposition to the Motion for Preliminary Injunction based on the 23 new hearing date. Good cause for the continuance and extension exists because: (1) Plaintiff filed 24 this action in a distant improper venue that lacks personal jurisdiction such that the Court must 25 first hear Defendant's motion to dismiss and/or transfer venue in order to assure that Plaintiff's 26 preliminary injunction motion is heard in the proper venue by a court with jurisdiction over 27 Defendant; (2) a continuance will not prejudice Plaintiff, who delayed filing this action, never 28 sought a temporary restraining order and delayed serving its preliminary injunction papers even
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DEFENDANT'S EX PARTE APPLICATION FOR CONTINUANCE OF HEARING DATE ON PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION

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1 after their completion; and (3) Defendant was only recently able to retain counsel admitted to 2 practice before this Court and defense counsel needs additional time to adequately prepare and 3 respond to Plaintiff's preliminary injunction motion, including Plaintiff's belated submission of 4 additional declarations, in order to avoid prejudice and irreparable injury to Defendant. 5 Defendant's counsel requested that Plaintiff stipulate to a continuance of the hearing on the Motion 6 for Preliminary Injunction, and a corresponding extension of time to respond, but Plaintiff has 7 refused to stipulate to a continuance or an extension (and has even refused to accept service of 8 papers by facsimile). Accordingly, this application is both necessary and appropriate, and should 9 be granted by the Court. 10 11 I. 12 13 MEMORANDUM OF POINTS AND AUTHORITIES BACKGROUND A. Factual Background.

Plaintiff Nutrishare ("Plaintiff" or "Nutrishare") is misusing its trademark in an attempt to

14 maintain its admitted monopoly over the market for in-home parenteral (IV) nutrition products and 15 services (also referred to as TPN). Indeed, the facts as alleged by Plaintiff illustrate that Plaintiff 16 delayed filing this action against BioRx, its only competitor in the market, until its market share 17 began to be threatened, and then filed the action in a distant and improper forum to achieve a 18 maximum anticompetitive threat. As Plaintiff admits: 19 20 21 22 23 24 25 "Until last year, Nutrishare was the only company in the nation that focused exclusively on providing Home TPN products and services . . . . Now, there are two companies ­ Nutrishare and BioRx's NutriThrive division ­ that focus on in-home TPN products and services." (Decl. of Rodney Okamoto in Supp. of Mot. for Prelim. Injunction ("Okamoto Decl."), ¶ 21 (emphasis in original)). "Within the past six months, NutriThrive has begun encroaching on Nutrishare's sales territory, and actually has solicited Nutrishare's customer and physician colleages." (Okamoto Decl., ¶ 16). Plaintiff's own allegations demonstrate that they did not commence this action promptly,

26 but rather waited until after Defendant had invested substantial time, effort and money into its 27 / / / / / 28
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1 NutriThrive brand. For instance, the following is a timeline according to Plaintiff's own 2 allegations (and publicly available government records): 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 · · · · · · · · June 2007: Plaintiff knew in June 2007 BioRx was going to use the NutriThrive name, when it did not have a single customer, because BioRx announced at the Oley Foundation Conference (one of Plaintiff's primary marketing vehicles) that BioRx would provide "in-home enteral nutrition and in-Home TPN products and services" under the NutriThrive brand name. (Okamoto Decl., ¶ 13). July/August 2007: NutriThrive advertisements run in the Lifeline Letter, "the most widely circulated Home TPN newsletter and Nutrishare's primary marketing vehicle for its print advertising." (Okamoto Decl., ¶ 14). Unknown date 2007: Nutrishare (through its coordinator of clinical services and research) claims to have learned about supposed confusion between Nutrishare and NutriThrive. (Decl. of Reid Nishikawa in Supp. of Mot. for Prelim. Injunction ("Nishikawa Decl."), ¶ 4(a)). November/December 2007: NutriThrive again runs advertisements in the Lifeline Letter, "the most widely circulated Home TPN newsletter and Nutrishare's primary marketing vehicle for its print advertising." (Okamoto Decl., ¶ 14). January 2008: The NutriThrive trademark publishes for opposition in 1/1/08 (class 44 ­ medical, beauty agricultural) and 1/15/08 (class 5 -pharmaceutical).1 February 2008: Nutrishare claims to have learned of two more instances of supposed confusion. (Nishikawa Decl., ¶ 4(b), (c)). February 2008: Nutrishare does not oppose registration of NutriThrive mark.2 March/April 2008: The Lifeline Newsletter lists Nutrishare above (and in different category) as NutriThrive. (Okamoto Decl., ¶ 13).

Plaintiff waited until June 4, 2008, to commence this action far from BioRx's place of

22 business (Ohio) and, no doubt due to its lengthy delay, did not bother to seek a temporary 23 restraining order. Plaintiff's nearly year long delay in bringing this action demonstrates that a 24 continuance of a few more weeks will not result in any prejudice. 25 26 27 28
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Defendant hereby requests that the Court take judicial notice of the official website for the United States Patent and Trademark office, at http://tarr.uspto.gov/tarr?regser=serial&entry=77229275&action=Request+Status and http://tarr.uspto.gov/tarr?regser=serial&entry=77229266. See footnote 1, supra.
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B.

Procedural Background.

On June 4, 2008, Nutrishare, a California corporation with its corporate headquarters in

3 Elk Grove, California, filed its Complaint in the United States District Court for the Eastern 4 District of California, against BioRx, an Ohio Limited Liability Company headquartered in 5 Cincinnati, Ohio. (Plaintiff's Complaint, ¶¶ 1-2). In its Complaint, Plaintiff seeks to maintain its 6 monopoly and prevent further competition by alleging causes of action for trademark infringement 7 and unfair competition as a result of Defendant's use of the "nutri" prefix by its NutriThrive 8 division, which specializes in providing products and services to individuals requiring in-home 9 parenteral (IV) and enteral (tube feeding) nutrition. Plaintiff did not seek a temporary restraining 10 order, nor did it promptly serve the Complaint. In fact, in a letter from Plaintiff's counsel to 11 Defendant dated June 4, 2008 regarding Plaintiff's alleged claims against BioRx, Plaintiff did not 12 even mention the filing of the Complaint. (See Exhibit A attached to the Decl. of Michael J. 13 Thomas in Supp. of Mot. for Prelim. Injunction). 14 Instead, Plaintiff withheld service of the Complaint until after June 24, 2008, when

15 Plaintiff filed a Motion for Preliminary Injunction seeking to enjoin Defendant from using the 16 name NutriThrive or any variant of the name containing the "nutri" prefix, with a scheduled 17 hearing date of August 4, 2008 at 2:00 p.m. (Declaration of Charlene J. Wilson in Support of Ex 18 Parte Application ("Wilson Decl."), ¶ 2). The Complaint and Motion for Preliminary Injunction 19 with supporting declarations were not served on Defendant until June 26, 2008. (Wilson Decl., 20 ¶ 3). On July 9, 2008, Defendant was served with additional declarations in support of Plaintiff's 21 Motion for Preliminary Injunction ­ which included a June 28, 2008 declaration of Kerry Stone 22 that Plaintiff delayed serving. (Wilson Decl., ¶ 4). 23 Defendant's responsive pleading to the Complaint is due on or before July 16, 2008.

24 F.R.C.P. 6(a)(1)(A)(i). Defendant is in the process of finalizing, and will file on or before July 16, 25 a motion to dismiss and/or transfer on the basis of lack of personal jurisdiction and improper 26 venue pursuant to Federal Rule of Civil Procedure 12(b). Defendant's motion to dismiss and/or 27 transfer will be noticed for hearing on August 18, 2008. (Wilson Decl., ¶ 6). However, 28 Defendant's Opposition to the Motion for Preliminary Injunction is currently due on or before July
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1 21, 2008 and is currently scheduled for hearing on August 4, 2008, prior to the hearing on 2 Defendant's motion to dismiss and/or transfer. (Wilson Decl., ¶ 7). 3 Because lead defense counsel is located in Cincinnati, Ohio (where the Defendant is

4 located) and not admitted to practice before the Eastern District of California, local defense 5 counsel was just recently retained on July 11, 2008. (Wilson Decl., ¶ 5). In light of its recent 6 retention in this matter and the anticipated filing of a motion to dismiss and/or transfer, local 7 defense counsel attempted to contact Plaintiff's counsel on July 14, 2008 by telephone and by 8 letter sent via facsimile and e-mail to request a stipulation to extend the hearing date on Plaintiff's 9 Motion for Preliminary Injunction to a date following a ruling on Defendant's motion to dismiss 10 and/or transfer. Defense counsel advised Plaintiff's counsel that, in the event Plaintiff was 11 unwilling to stipulate, Defendant would be requesting a continuance and extension by ex parte 12 application. (Wilson Decl., ¶ 8, Ex. A). Defense counsel again attempted to reach Plaintiff's 13 counsel by telephone on July 15, 2008 regarding the requested stipulation. (Wilson Decl., ¶ 9). 14 Defense counsel was subsequently informed, both by telephone and by letter that Plaintiff would 15 not stipulate to the requested continuance and extension and that Plaintiff would be opposing 16 Defendant's ex parte application. (Wilson Decl., ¶ 10, Ex. B). No prior continuances or 17 extensions have been requested in this matter. (Wilson Decl., ¶ 11). 18 II. 19 20 21 22 GOOD CAUSE EXISTS FOR A CONTINUANCE OF THE PRELIMINARY INJUNCTION HEARING DATE AND CORRESPONDING EXTENSION FOR DEFENDANT'S OPPOSITION TO PLAINTIFF'S MOTION FOR PRELIMINARY INJUNCTION The Court has the inherent authority to control its own docket and to manage its own

23 affairs so as to "achieve the orderly and expeditious disposition of cases." Chambers v. NASCO, 24 Inc., 501 U.S. 32, 43 (1991); see also Atchison, Topeka & Santa Fe Ry. Co. v. Hercules, Inc., 146 25 F.3d 1071, 1074 (9th Cir. 1998). Accordingly, pursuant to Federal Rules of Civil Procedure, when 26 "an act may or must be done within a specified time, the court may, for good cause, extend the 27 time: (A) with or without motion or notice if the court acts, or if a request is made, before the 28 original time or its extension expires". F.R.C.P. 6(b). In addition, Local Rules 6-144 and 78-230
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1 state that requests for extensions of time shall be made as soon as need for an extension becomes 2 apparent and, with respect to hearing continuances, at least five court days prior to the scheduled 3 hearing date. 4 The request to continue the hearing date on Plaintiff's Motion for Preliminary Injunction

5 and, corresponding extension of the deadline for Defendant's Opposition thereto, is timely as it is 6 being made more than five court days prior to the scheduled hearing date and prior to the deadline 7 for Defendant's Opposition. Furthermore, the requested short continuance and extension: (1) 8 serves judicial economy and precludes litigation of issues that are not properly before this Court, 9 (2) will not prejudice Plaintiff (as evidenced by Plaintiff's own lengthy delay in bringing this 10 action and its failure to seek a temporary restraining order, promptly serve the Complaint, or even 11 inform Defendant of the filing of the Complaint in its June 4, 2004 letter), (3) is necessary due to 12 the recent retention of local defense counsel who needs additional time to adequately defend 13 against a preliminary injunction motion that, if granted, would irreparably injure Defendant, and 14 (4) is necessary as a result of the recent submission by Plaintiff of additional declarations in 15 support of their Motion for Preliminary Injunction. 16 17 18 A. Personal Jurisdiction Must Be Established Prior to a Preliminary Injunction Hearing. Judicial economy would be served by continuing the hearing date on the Preliminary

19 Injunction until after the hearing on Defendant's motion to dismiss and/or transfer. Simply stated, 20 this Court does not have personal jurisdiction over Defendant and the Eastern District of 21 California is not the proper venue. Rather, the matter should properly be brought in the United 22 States District Court for the Southern District of Ohio (where the Defendant resides). A resolution 23 of this issue must be made prior to a hearing on Plaintiff's Motion for Preliminary Injunction as 24 personal jurisdiction is a foundational requirement to the ability of this Court to grant an 25 injunction against Defendant. See, e.g., Burnham v. Superior Court, 495 U.S. 604, 608 (1990) 26 (noting the well-settled rule that a judgment of a court lacking jurisdiction is void); Weitzman v. 27 Stein, 897 F.2d 653 (2d Cir. 1990) (holding that an injunction was improperly entered for failure 28 to establish personal jurisdiction).
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B.

Plaintiff Will Not Be Prejudiced By the Requested Extension.

Given Plaintiff's delay in bringing this action and failure to seek a temporary restraining

3 order, the minimal delay in the hearing date will not prejudice Plaintiff. Specifically, as admitted 4 in the declarations submitted by Plaintiff in support of its Motion for Preliminary Injunction, 5 Plaintiff was aware in June 2007 that Defendant was going to use the NutriThrive name. 6 (Okamoto Decl., ¶ 13). At some point in 2007, and again in February 2008, Plaintiff claims to 7 have become aware of alleged instances of confusion between Plaintiff (Nutrishare) and 8 NutriThrive. (Nishikawa Decl., ¶ 4(a)-(c)). Yet Plaintiff waited until early June 2008 ­ a year 9 after becoming aware of Defendant's use of the NutriThrive name ­ to bring this action. In fact, 10 Plaintiff filed its Complaint only after its market share began to deteriorate and it realized that, for 11 the first time in its 17-year history, they had a competitive threat. Plaintiff's delay in filing and 12 serving its Complaint until well after it knew of Defendant's use of the NutriThrive name, as well 13 as its failure to seek a temporary restraining order or promptly inform Defendant of the filing of 14 the Complaint, demonstrates the lack of prejudice to Plaintiff as a result of a minimal delay in 15 hearing its Motion for Preliminary Injunction. 16 17 C. Local Defense Counsel Has Only Recently Been Retained.

Defendant was not served with the Complaint or Motion for Preliminary Injunction until

18 June 26, 2008. (Wilson Decl., ¶ 3). Lead defense counsel are located in Cincinnati, Ohio (where 19 Defendant is located) and are not admitted to practice before this Court. Accordingly, it was 20 necessary to retain local defense counsel to assist with the defense of this matter. The undersigned 21 counsel, who are admitted to practice before this Court, were recently retained on July 11, 2008. 22 Because defense counsel has been diligently preparing its motion to dismiss and/or transfer, 23 additional time is necessary to prepare and file its Opposition to the Motion for Preliminary 24 Injunction. (Wilson Decl., ¶¶ 5-6). 25 Indeed, the need for additional time is directly related to Plaintiff's tactical decision to

26 withhold service of the Complaint. If Plaintiff had served the Complaint promptly after filing it on 27 June 4, 2008 ­ or even informed Defendant that it had been filed ­ rather than waiting to serve it 28 until June 26, 2008 just before the July 4th holiday, Defendant would have been able to retain
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1 local counsel earlier to assist in the defense. Instead, Plaintiff chose to hold the Complaint and 2 deprive Defendant of precious time needed to retain local counsel to assist in the defense. 3 4 5 D. Additional Time is Necessary Due to Plaintiff's Recent Submission of Additional Declarations. Defendant only recently received additional declarations submitted by Plaintiff in support

6 of its Motion for Preliminary Injunction. One of these declarations ­ the Declaration of Kerry 7 Stone ­ was signed on June 28, 2008 (four days after Plaintiff had filed its Motion for Preliminary 8 Injunction), but not served on Defendant until July 9, 2008. This once again evidences Plaintiff's 9 gamesmanship and use of delay to obtain an advantage against its competitor. Moreover, an 10 additional declaration was submitted by Rodney Okamoto. (Wilson Decl., ¶ 4). Defendant 11 therefore needs additional time to respond and rebut the declarations and evidence that were only 12 recently submitted by Plaintiff. 13 Accordingly, there is ample good cause for the requested continuance of the preliminary

14 injunction hearing date. 15 III. 16 CONCLUSION Based on the foregoing arguments, Defendant requests that this Court issue an order to

17 continue the hearing date on Plaintiff's Motion for Preliminary Injunction to a date following the 18 Court's ruling on Defendant's motion to dismiss and/or transfer, with a corresponding extension 19 for Defendant's Opposition and any Reply based on the new hearing date to the extent necessary. 20 21 Dated: July 15, 2008 22 23 24 25 26 27 28
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ALLEN MATKINS LECK GAMBLE MALLORY & NATSIS LLP By: /s/ Charlene J. Wilson AMY WINTERSHEIMER FINDLEY MICHAEL R. ADELE CHARLENE J. WILSON Attorneys for Defendant BIORX, LLC

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