United States District Court, N.D. Indiana
OPINION AND ORDER
THERESA L. SPRINGMANN CHIEF JUDGE
matter comes before the Court on a Motion to Dismiss [ECF No.
48], filed by Defendants Ashleigh Renee Firgaira, Archery
Sports, and Archery Attack (collectively “the
Defendants”) on May 24, 2017. The Defendants move to
dismiss pursuant to Rule 12(b)(1), asserting that the Court
lacks subject-matter jurisdiction over Plaintiff Global
Archery Products, Inc.'s Third Amended Complaint [ECF No.
32]. For the reasons stated below, the Court denies the
Plaintiff is an Indiana corporation and the “founder
and developer” of the game Archery Tag, a game
“played similar to dodgeball with . . . bows and U.S.
patented foam-tipped non-lethal arrows.” (Third Am.
Compl. ¶¶ 2, 14, ECF No. 32.) The Plaintiff
allegedly “has over 400 licenses in 40 countries for
its ARCHERY TAG® system, ” including in Australia.
(Id. ¶¶ 13, 15.) “On December 31,
2014, [Defendant] Archery Sports entered into an online
License Agreement with [Plaintiff] that was executed by Chris
Firgaira, ” the husband of Ashlee Firgaira,
“acting as the business manager of Archery
Sports.” (Id. ¶ 11.) “As part of
the License Agreement, [the Plaintiff] licensed certain
equipment to Archery Sports in connection with the ARCHERY
TAG® System as well as granted Archery Sports a license
to [its] ARCHERY TAG® Documentation, ” including
proprietary and confidential information regarding the setup
and playing of Archery Tag games. (Id. ¶¶
License Agreement includes a “Covenant Not to
Compete” barring Archery Sports from “engag[ing]
in any business involving the ownership or operation of a
field in which the Archery Tag® System or similarly
archery sport . . . is played” for a period of three
years. (Id. ¶ 34 (quoting License § 12.3,
ECF No. 32-1).) In addition, the License Agreement states
that Defendant Archery Sports “voluntarily submits . .
. to the personal jurisdiction [of] courts of competent
jurisdiction in the State of Indiana, United States.”
(Id. ¶ 8 (quoting License § 12.4).)
February 27, 2015, “operating under the direction and
control of her husband or in active concert with him, ”
Ashlee Firgaira “formally formed a sole proprietorship
under the name Archery Sports, ” and again “under
the name of Archery Attack” on July 25, 2015.
(Id. ¶¶ 19, 22.) The Plaintiff alleges that
Ashlee and Chris Firgaira “conspired” to form
Archery Attack under Ashlee Firgaira's name “in an
attempt to avoid the terms and conditions of the License
Agreement executed by her husband as the business manager of
Archery Sports.” (Id. ¶ 25.)
Additionally, the Plaintiff alleges that “Mr. Firgaira
placed web pages on [www.archertyattack.com] that
insinuated that he was the founder and originator of the
‘ARCHERY ATTACK' game and had pictures of players
playing the game using [Plaintiff's] ARCHERY TAG®
equipment.” (Id. ¶ 24.) As of June 2016,
the “Archery Attack website is still operational and .
. . has changed all references [from] ARCHERY TAG® to
‘ARROW TAG.'” (Id. ¶ 30.) The
License Agreement expired on January 1, 2016, although the
Plaintiff has requested that the Defendants renew it.
(See Id. ¶¶ 28-29.)
Plaintiff filed its Third Amended Complaint on June 29, 2016,
alleging claims for breach of contract based upon the License
Agreement's covenant not to compete and the
Defendants' failure to return licensed equipment.
(Id. ¶¶ 38-52.) The Defendants filed a
Motion to Dismiss [ECF No. 34] on July 20, 2016, pursuant to
Federal Rules of Civil Procedure 12(b)(2) for lack of
personal jurisdiction and 12(b)(6) for failure to state a
claim upon which relief could be granted. After briefing was
completed, Judge Joseph Van Bokkelen denied the
Defendants' Motion on both grounds. [See ECF No.
hearing before Magistrate Judge Susan Collins on April 12,
2017, the Defendants argued that the amount in controversy in
this case was insufficient to meet the requirements of 28
U.S.C. § 1332(a), so the Magistrate Judge ordered the
Plaintiff to submit briefing on the issue. (See ECF
No. 43; see also Pl.'s Supp. Br. 4, ECF No. 44.)
Accordingly, the Plaintiff entered a Supplemental Brief in
Support of Amount in Controversy [ECF No. 43] on April 26,
2017, offering evidence that the amount sought was not less
than $75, 000. The Defendants filed a Response to the
Plaintiff's Supplemental Brief [ECF No. 46], arguing that
the total amount claimed against the named Defendants in the
Third Amended Complaint was insufficient to meet the amount
in controversy. This case was transferred to the undersigned
on May 1, 2017. [See ECF No. 45.]
10, 2017, the Magistrate Judge stated that the
Plaintiff's Supplemental Brief appeared to show that the
amount in controversy was satisfied, but permitted the
Defendants to file a motion challenging subject-matter
jurisdiction, which they formally filed on May 24, 2017. On
June 7, 2017, the Plaintiff filed its Opposition [ECF No. 50]
to the Defendants' Motion. The Defendants' Reply [ECF
No. 51] was entered June 14, 2017.
12(b)(1) provides that a party may assert the defense of lack
of subject-matter jurisdiction by motion. Fed.R.Civ.P.
12(b)(1). “Subject-matter jurisdiction is the first
question in every case, and if the court concludes that it
lacks jurisdiction it must proceed no further.”
Illinois v. City of Chicago, 137 F.3d 474, 478 (7th
Cir. 1998). “Where jurisdiction is challenged as a
factual matter, the party invoking jurisdiction has the
burden of supporting the allegations of jurisdictional facts
by competent proof, . . . which means ‘proof to a
reasonable probability that jurisdiction exists.'”
Middle Tenn. News Co. v. Charnel of Cincinnati,
Inc., 250 F.3d 1077, 1081-82 (7th Cir. 2001) (citations
omitted) (quoting Target Mkt. Publ'g, Inc. v. ADVO,
Inc., 136 F.3d 1139, 1142 (7th Cir. 1998)). When
considering a motion to dismiss for lack of subject matter
jurisdiction, a court must accept as true all well-pleaded
factual allegations and draw all reasonable inferences in
favor of the plaintiff. Alicea-Hernandez v. Catholic
Bishop of Chi., 320 F.3d 698, 701 (7th Cir. 2003).
Third Amended Complaint alleges that the Court's
subject-matter jurisdiction is based on diversity of
citizenship under 28 U.S.C. § 1332. Diversity
jurisdiction exists when the parties to an action on each
side are citizens of different states, with no defendant a
citizen of the same state as any plaintiff, and the amount in
controversy exceeds $75, 000. 28 U.S.C. § 1332(a)(1). In
this case, the parties only dispute whether the amount in
controversy requirement is met. The Defendants argue that, at
most, the amount in controversy in this case is the amount
that the named Defendants allegedly profited after breaching
the License Agreement between the parties, which totals $20,
147. The Plaintiff argues that the amount in controversy
exceeds the $75, 000 threshold because it can aggregate the
$20, 147 amount that the named Defendants allegedly profited
and the amount that Chris Firgaira and Archery Attack
Proprietary Limited profited, which is allegedly between
$119, 850 and $329, 850. The Defendants counter that the
Plaintiff cannot include Chris Firgaira or Archery Attack
Proprietary Limited's alleged profits because they are
not named defendants in this case and the Court cannot
exercise personal jurisdiction over them.
federal court has subject-matter jurisdiction “unless
recovery of an amount exceeding the jurisdictional minimum is
legally impossible.” Grinnell Mut. Reinsurance Co.
v. Haight, 697 F.3d 582, 585 (7th Cir. 2012). “It
is the case, rather than the claim, to
which the $75, 000 minimum applies.” See LM Ins.
Corp. v. Spaulding Enters.,533 F.3d 542, 548, 552 (7th
Cir. 2008) (quoting Johnson v. Wattenbarger, 361
F.3d 991, 993 (7th Cir. 2004)). A plaintiff may
“aggregate the amount against” two or more
potentially liable parties “to satisfy the amount in
controversy requirement only if the defendants are jointly
liable.” See LM Ins. Corp. v. Spaulding
Enters.,533 F.3d 542, 548, 552 (7th Cir. 2008).
Further, the Seventh Circuit has clarified that “a
plaintiff [can] aggregate claims against multiple defendants
where it ...