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Chloe v. Queen Bee of Beverly Hills, LLC

Chloe v. Queen Bee of Beverly Hills, LLC

United States Court of Appeals for the Second Circuit

March 23, 2010, Argued; August 5, 2010, Decided

Docket No.: 09-3361-cv

Opinion

 [***1351]  [*161]   HALL, Circuit Judge:

Plaintiffs-Appellants Chloe and Chloe, S.A. (together, "Chloe") brought suit in United States District Court for the Southern District of New York (Holwell, J.) against, inter alios, Defendant-Appellee Simone Ubaldelli ("Ubaldelli") (collectively, "Defendants"). 2 The amended complaint alleged violations of sections 32(1) and 43(a) of the Trademark Act of 1946, 15 U.S.C. § 1051, et seq., and New York General Business Law § 349 (McKinney 2004), as well as common law trademark infringement and unfair competition.  [**3] Chloe moved for summary judgment on liability and Ubaldelli cross-moved to dismiss for lack of personal jurisdiction. The district court granted Ubaldelli's motion and denied Chloe's motion as moot. On appeal, Chloe argues that jurisdiction over Ubaldelli  [*162]  comports with New York's long-arm statute, N.Y. C.P.L.R. § 302(a) (McKinney 2001), and with due process. We agree and hold that Ubaldelli's single act of shipping an item into New York combined with the substantial business activity of Queen Bee, the entity with which Ubaldelli was affiliated, involving New York, give rise to personal jurisdiction over Ubaldelli. Accordingly, we vacate the judgment of the district court and remand the case for further proceedings.

I. BACKGROUND

A. Facts

Chloe, which refers both to the Plaintiff-Appellant that is a division of Delaware corporation Richemont North America, Inc.  [**4] ("Chloe NA"), and has its principal place of business in New York and to the Plaintiff-Appellant that is a French corporation ("Chloe SA") and has its principal place of business in Paris, is a fashion company that sells women's clothing and accessories. Chloe SA is the owner of a trademark registration for the word mark CHLOE for handbags. Chloe NA is the exclusive U.S. licensee of the CHLOE trademark for all Chloe branded goods. In 2005, Chloe was selling leather handbags for approximately $ 1,600 in Chloe's boutiques and as the suggested retail price for its wholesale accounts. Defendants sold counterfeit copies of this handbag on their website (www.queenbeebeverlyhills.com) for $ 1,200, plus shipping. Defendant Queen Bee of Beverly Hills, LLC ("Queen Bee"), is an Alabama LLC. Defendants Rebecca Rushing ("Rushing") and Ubaldelli were the principals and operators of Queen Bee. The company maintained showrooms in and shipped goods from Beverly Hills, California, and Huntsville, Alabama. Defendants maintained two websites with nearly identical URLs, and both sites directed users to the same content.

The sites advertised "trunk shows" across the country, offered to sell handbags purportedly  [**5] manufactured by various name-brand designers--including Chloe--and offered to ship bags anywhere in the continental United States and to select locations worldwide. Specifically, the website permitted a customer viewing the handbags to "Click here . . . to purchase this item." It then provided both a telephone number customers could call to make credit card payments and an interface through which customers could pay for their orders online through PayPal.

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616 F.3d 158 *; 2010 U.S. App. LEXIS 16192 **; 96 U.S.P.Q.2D (BNA) 1349 ***

CHLOE, A DIVISION OF RICHEMONT NORTH AMERICA, INC., CHLOE, S.A., Plaintiffs-Appellants, ABC, Plaintiff, v. QUEEN BEE OF BEVERLY HILLS, LLC, REBECCA RUSHING, ALSO KNOWN AS REBECCA GRELIER, MOHAMAD ALEXANDER ZARAFSHAN, ALSO KNOWN AS ALEXANDER ZAR, JENNIFER SUNS, SUNEYE PRODUCTIONS, INC. DEF, 2-20 JOHN DOES, Defendants, SIMONE UBALDELLI, Defendant-Appellee.

Subsequent History: On remand at, Partial summary judgment granted by Chloe v. Queen Bee of Beverly Hills, LLC, 2011 U.S. Dist. LEXIS 94000 (S.D.N.Y., Aug. 19, 2011)

Prior History:  [**1] Plaintiffs-Appellants Chloe and Chloe, S.A. brought suit in United States District Court for the Southern District of New York (Holwell, J.) against, inter alios, Defendant-Appellee Simone Ubaldelli. The amended complaint alleged violations of sections 32(1) and 43(a) of the Trademark Act of 1946, 15 U.S.C. § 1051, et seq., and New York General Business Law § 349 (McKinney 2004), as well as common law trademark infringement and unfair competition. Plaintiffs-Appellants moved for summary judgment on liability and Ubaldelli cross-moved to dismiss for lack of personal jurisdiction. The district court granted Ubaldelli's motion and denied as moot Plaintiffs-Appellants' motion seeking a judgment of liability. Because the assertion of personal jurisdiction over Ubaldelli comports with New York's long-arm statute, N.Y. C.P.L.R. § 302(a) (McKinney 2001), and with due process, we hold that Ubaldelli's single act of shipping an item into New York, combined with the affiliated business's substantial activity involving New York, give rise to personal jurisdiction over Ubaldelli. Accordingly, we VACATE the judgment of the district court and REMAND the case for further proceedings.

Chloe v. Queen Bee of Beverly Hills, LLC, 571 F. Supp. 2d 518, 2008 U.S. Dist. LEXIS 58651 (S.D.N.Y., 2008)

CORE TERMS

contacts, shipping, personal jurisdiction, bags, handbags, counterfeit, forum state, consumers, district court, website, long-arm, minimum contact, single act, quotation, marks, trademark infringement, transaction of business, purposefully, shipment, sales, trademark, selling, buy, business activity, customers, transacts, factors, exercise of jurisdiction, due process, pay rent

Civil Procedure, In Rem & Personal Jurisdiction, In Personam Actions, Challenges, Appeals, Standards of Review, De Novo Review, Long Arm Jurisdiction, Due Process, Minimum Contacts, Purposeful Availment