United States District Court, D. Oregon
FINDINGS AND RECOMMENDATION
F. BECKERMAN UNITED STATES MAGISTRATE JUDGE
matter comes before the Court on Teespring, Inc.'s
(“Teespring”) motion to: (1) sever Stay Frosty
Enterprises, LLC's (“Stay Frosty”) claims
against Teespring, pursuant to Fed.R.Civ.P. 21; and (2)
dismiss or transfer the severed claims against Teespring to
the Northern District of California, pursuant to 28 U.S.C.
§§ 1404 and 1406. The Court has jurisdiction over
this matter pursuant to 28 U.S.C. §§ 1331 and 1338.
For the reasons discussed below, the Court recommends that
the district judge grant Teespring's motions to sever and
transfer. (ECF No. 94.)
Frosty is an Oregon limited liability company that designs
“original works of art put onto apparel, specialty
‘challenge' coins, posters, and other items that
are primarily marketed via the internet to individuals in the
military, law enforcement, public safety communities,
enthusiasts, collectors and others.” (Compl. ¶ 1.)
Derek Frost (“Frost”), a resident of California
and co-owner of Stay Frosty, created and registered the
“works of visual art” at issue in this case.
(Compl. ¶ 18, Ex. B, at 1, Ex. C, at 3.) Frost
“assigned his rights, titles, and interest in all of
the works of art” to Stay Frosty on January 16, 2018.
(Compl. ¶ 20, Ex. C, at 3.)
is a Delaware corporation headquartered in San Francisco,
California. (Weibell Decl. Supp. Def.'s Mot. Sever &
Dismiss or Transfer (“Weibell Decl.”) ¶ 3.)
Teespring operates a website that allows users to submit
designs that can be applied to apparel and sold on
Teespring's website. (Compl. ¶¶ 3, 66-89.)
Teespring and its users profit from the sales. (Compl. ¶
67.) Stay Frosty identified several t-shirts for sale on
Teespring's website that bear designs that are
“strikingly similar” to the designs that Frost
copyrighted. (See Compl. ¶¶ 68-86.) Stay
Frosty filed this copyright case against Teespring on
February 14, 2018.
Frosty asserts that Teespring waived its venue challenge by
filing a responsive pleading. (See Pl.'s Resp.
Def.'s Mot. Sever & Dismiss or Transfer
(“Pl.'s Resp.”) at 2, 4.) The Court
defendant must object to venue by motion or in his answer to
the complaint or else his objection is waived.”
Costlow v. Weeks, 790 F.2d 1486, 1488 (9th Cir.
1986) (citations omitted). Teespring filed an answer on April
17, 2018, and included improper venue as an affirmative
defense. (See Def.'s Answer ¶¶ 7, 65.)
Although the case has now progressed to discovery, the Court
finds that Stay Frosty did not waive its improper venue
defense because it pled improper venue as an affirmative
defense. See Meras Eng'g, Inc. v. CH2O,
Inc., No. 11-0389, 2013 WL 146341, at *9 (N.D. Cal. Jan.
14, 2013) (noting that the defendant participated in
mediation, agreed to a discovery schedule, and provided
initial disclosures, but nevertheless concluding that the
defendant did not waive an improper venue defense because the
defendant asserted an improper venue defense in its answer
and continued to raise the issue of venue during the course
of the litigation).
TEESPRING'S MOTION TO SEVER
moves to sever Stay Frosty's claims against Teespring
from Stay Frosty's claims against Milcoins.com, LLC,
pursuant to Fed.R.Civ.P. 21. (Def.'s Mot. Sever &
Dismiss or Transfer (“Def.'s Mot.”) at 2,
5-6.) Stay Frosty acknowledges that its claims against
Teespring were improperly joined, and does not oppose
severance. (Pl.'s Resp. at 1, 5.) However, if the Court
severs the claims, Stay Frosty asks to maintain the current
case schedule to avoid having to refile its complaint and
start “back at square one.” (Pl.'s Resp. at
1, 6.) Teespring responds that the Court should order Stay
Frosty “to file a new complaint specific to Teespring
in the new severed civil action because the current complaint
is laden with non-specific allegations made against all
thirteen defendants jointly.” (Def.'s Reply at 3;
see also Def.'s Mot. at 3.)
Court finds that Stay Frosty improperly joined multiple
unrelated defendants in the same copyright action, and
recommends that the district judge grant Teespring's
motion to sever. Consistent with the Court's
recommendation below, the district judge should transfer Stay
Frosty's severed case against Teespring to the Northern
District of California, which will preserve the forward
progress of the case to date. Stay Frosty and Teespring may
resolve the issue of filing an amended complaint in the
transferee court. Stay Frosty's remaining (defaulted)
claims against Milcoins.com LLC shall proceed under the
current case number in this court.
moves to dismiss or transfer the severed claims to the
Northern District of California pursuant to 28 U.S.C. §
1406(a), based on improper venue. In the alternative,
Teespring requests transfer for convenience under 28 U.S.C.
§ 1404(a). (Def.'s Mot. at 2-3, 6, 10.) The Court
agrees that the district judge should ...