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Jayco, Inc. v. National Indoor RV Centers, LLC

United States District Court, N.D. Indiana, South Bend Division

September 26, 2017

JAYCO, INC., Plaintiff
v.
NATIONAL INDOOR RV CENTERS LLC, et al., Defendants

          OPINION AND ORDER

          Robert L. Miller, Jr. Judge United States District Court.

         Jayco, Inc. filed suit against National Indoor RV Centers, LLC (“NIRVC”), NIRVC-AZ, LLC (“National Arizona”), National Indoor RV Centers-GA, LLC (“National Georgia”) and Angie Morell, alleging that they infringed on its Entegra Coach trademarks and engaged in unfair competition in violation of federal and state law and breached their dealership agreements when they used those trademarks to market and sell Entegra Coach motor homes in Texas without Jayco's permission. The defendants (collectively, “National”) moved to dismiss the suit for lack of personal jurisdiction and improper venue. For the following reasons, the court grants their motion.

         I. Standard of Review

         When a dismissal motion raises the issue of personal jurisdiction, the plaintiff must establish personal jurisdiction over each of the defendants. Advanced Tactical Ordnance Sys., LLC v. Real Action Paintball, Inc., 751 F.3d 796, 799 (7th Cir. 2014); Tamburo v. Dworkin, 601 F.3d 693, 700 (7th Cir. 2010); Purdue Research Foundation v. Sanofi-Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir. 2003). The court can receive and weigh affidavits, exhibits and other evidence in determining whether it has personal jurisdiction, Purdue Research Foundation v. Sanofi-Synthelabo, S.A., 338 F.3d at 782; Nelson v. Park Indus., Inc., 717 F.2d 1120, 1123 n.7 (7th Cir. 1983). “[O]nce the defendant has submitted affidavits or other evidence in opposition to the exercise of jurisdiction, the plaintiff must go beyond the pleadings and submit affirmative evidence supporting the exercise of jurisdiction.” Purdue Research Foundation v. Sanofi-Synthelabo, S.A., 338 F.3d at 783.

         As with all motions to dismiss, the court must accept all well-pleaded facts alleged in the complaint as true, and draw all reasonable inferences in the plaintiff's favor. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009); Anicich v. Home Depot U.S.A., Inc., 852 F.3d 643, 648 (7th Cir. 2017). Any factual disputes in the affidavits must also be resolved in the plaintiff's favor. Tamburo v. Dworkin, 601 F.3d at 700; Purdue Research Foundation v. Sanofi-Synthelabo, S.A., 338 F.3d at 783.

         II. Factual Background

         The facts that follow are taken from the complaint, affidavits, and exhibits submitted in support of the parties arguments, are deemed to be true for purposes of this motion, and, consistent with the standard outlined above, have been construed in a light most favorable to Jayco.[1]

         Jayco is an Indiana corporation with its principal place of business in Middlebury, Indiana. National is a Delaware limited liability company, with its principal place of business in Plano, Texas, and is a citizen of Texas, Connecticut, and Utah.[2] National Arizona is an Arizona limited liability company and a wholly owned subsidiary of National, with its principal place of business in Phoenix, Arizona. National Georgia, another wholly owned subsidiary of National, is a Georgia limited liability company, with its principal place of business in Lawrenceville, Georgia. [Doc. Nos. 1 at ¶ 10 and 25-1 at ¶ 5, 6]. Angie Morell is a citizen of Texas. [Doc. Nos. 1 at ¶ 11 and 25-4 at ¶ 2]. The defendants don't reside in or have any members, employees, agents, offices, or real property in Indiana.

         Jayco and Entegra Coach (a division of Jayco) design, manufacture, and sell motor homes through a network of independent dealers located throughout the United States. Entegra Coach is one of Jayco's registered trademarks, as are the Entegra Coach symbol (“EC” in script format inside a circle), and the model names of Entegra Coach motorhomes (Insigna, Aspire, Anthem, and Cornerstone).

         In November 2016, National and Jayco entered into a Dealership Sales and Service Agreement that authorized National Arizona: “to sell and service Entegra Coach Products and represent itself as an Entegra Coach Dealer” in Maricopa and Gila Counties in Arizona (which the agreement calls the “Dealer Sales Territory”); “to purchase Entegra Coach product(s)...including accessories and repair parts”; and “to use Entegra Coach's trade names and trademarks in the promotion, sales, and service of Entegra Coach Products.” The Agreement prohibited National Arizona from: “establish[ing] an Entegra Coach sales location [or] originat[ing] sales of Entegra Coach Products outside its Dealer Sales Territory”, and “display[ing] product(s) for sale or marketing purposes within another Dealer's Sales Territory without the written consent of Entegra Coach.” Negotiations about National's Arizona dealership took place by telephone, email, and during in person meetings in Texas, and National vice president Hal Kendrick executed the dealership application and dealership sales and service agreement in Texas, in November 2016.

         National's Chief Financial Officer, Angelo Prieto, completed a dealership application for National Georgia at National's Texas office in April 2013, and Jayco alleges that it executed a dealership agreement that was “substantially similar” to the National Arizona agreement.[3] On June 29, 2016, Brett Davis, the CEO for National and its subsidiaries, signed a “Line-Make Addendum Page” at the Texas office, agreeing that National Georgia would “maintain in stock or on order” a minimum of four Entegra Coach “Insignia Class A Motorhomes” at its Lilburn, Georgia location, and would “concentrate its best efforts toward attaining the designated target retail performance objective [a minimum of 16 units annually].”

         Under those agreements, National Arizona and National Georgia are licensed dealers for Entegra Coach. National also sells motor homes in Lewisville, Texas, but it isn't licensed to sell Entegra Coach motor homes there.

         Between August 2013 and June 2017, National ordered 251 Entegra Coach motor homes from Jayco (valued at $77.2 million) through Ted Cook, a Jayco saleperson located in Middlebury, Indiana. About the same time, National also purchased parts valued at $391, 836.00, using Jayco's online Dealer Portal, which is “hosted” in Middlebury, Indiana. The parts were invoiced from Jayco's offices in Indiana to National's primary administrative office in Plano, Texas, and were shipped to Georgia, Arizona, and Texas.

         National presented evidence that all orders for Entegra Coach motor homes were processed and forwarded from its Texas office, and that all of those motor homes were sold by National Arizona in Arizona or by Georgia in Georgia. Jayco hasn't presented any evidence to the contrary.

         Preauthorization request for warranty work and warranty claims were submitted online, and were processed at Jayco's warranty center in Indiana. Joyce Skinner, Jayco's Director of Customer Service for Entegra Coach, attests that National submitted 3, 898 preauthorization request between July 2015 and June 2017; that National Georgia submitted 1, 021 warranty claims and was paid $754, 119.67 for those claims between November 2013 to June 2017; and that National Arizona submitted 41 warranty claims between April and June 2017, and was paid $22, 495.81 for those claims.

         At Jayco's request, National registered and/or sent six service technicians to Indiana for training on Entegra Coach products between 2014 and 2017.

         When Jayco received a complaint from Motorhome Specialist, its dealer in Dallas, Texas, that National was selling Entegra Coach motor homes from its Lewisville, Texas location (which is within Motor home Specialists' assigned territory), Jayco sent a private investigator to make inquiries.

         The complaint alleges in pertinent part that:

• On or about May 9, 2017, a private investigator hired by Jayco visited NIRV[C]'s Lewisville location. The [investigator] inquired about purchasing an Entegra Coach. Initially, [a National] salesperson, Stephanie Lopez, told the [investigator] that [National] was not allowed to sell Entregra Coach motorhomes from the Texas location. Lopez told the [investigator] that they would fly a buyer to [National's] locations in Georgia or Arizona to purchase an Entegra Coach. Lopez then showed a 2017 Entegra to the [investigator]. Lopez told the [investigator] that she would introduce the [investigator] to Angie Morell, who was a salesperson on contract, and not an employee of [National]-TX, so that Morell could sell an Entegra Coach to the [investigator]. However, Morell's ...

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