declaratory judgment action on the grounds that it involved the same facts, parties and issues. In affirming dismissal of the first filed declaratory judgment action, the Seventh Circuit noted a federal court's general discretion to decline to bear a declaratory judgment action and framed the issue as whether the district court properly exercised its discretion. Tempco, 819 F.2d at 747.
The court held that the mere filing of the declaratory judgment action first did not give plaintiff the right to choose the forum. Plaintiff urged adoption of a "first to file" rule but the Court rejected that proposal noting that "this circuit has never adhered to a rigid first to file" rule. (Citations omitted). Tempco, 819 F.2d at 750. Instead the Court held that, since the filing of the infringement suit had ripened the dispute between the parties, a declaratory judgment would serve no useful purpose and the district court properly exercised its discretion regarding hearing such actions by dismissing the declaratory judgment Complaint. Tempco, 819 F.2d at 749.
Black & Decker asserts that, like the plaintiff in Tempco, Vermont American filed its declaratory judgment action as a "preemptive strike' in anticipation of Black & Decker's infringement suit to gain "home court advantage" and to delay resolution of the dispute. Black & Decker argues that dismissal or transfer of this Complaint would "fly in the face" of Tempco, However, the Court finds that Tempco is not dispositive here.
This case is factually dissimilar in that the procedural posture of this case differs. Here, we are presented with a motion to dismiss, stay or transfer an infringement complaint whereas in Tempco, the court had to decide whether to dismiss a declaratory judgment action. This difference is significant since, unlike trademark infringement actions, courts have general discretion to decline to hear declaratory judgment actions but do not have the authority to exercise that discretion for another district. Essentially, Black & Decker argues that the declaratory judgment in Kentucky would serve no useful purpose; however, this Court does not have authority to make dispositive rulings on a case pending in Kentucky. For this reason, Tempco does not preclude transfer of this case.
The Court finds that the Koos case persuasive. In Koos, plaintiff, a Wisconsin corporation, brought suit for trademark infringement in the Northern District of Illinois four days after defendant, a Pennsylvania corporation, brought an action for declaratory judgment in the Eastern District of Pennsylvania. Judge James H. Alesia of the Northern District of Illinois held a hearing on plaintiff's motion for temporary restraining order and, sua sponte, transferred the later filed complaint for infringement to Pennsylvania pursuant to Section 1404 (a). Significantly, Judge Alesia distinguished Koos from his earlier decision in Associated Mills, Inc. v. Regina Co., Inc., 675 F. Supp. 446 (N.D. Ill. 1987). In Associated Mills, Judge Alesia relied on Tempco and exercised his judicial discretion to dismiss a first filed declaratory judgment action. However, in Koos, Judge Alesia found that since the case before him was an infringement action rather than a declaratory judgment action and because there were no issues as to venue because plaintiff was not an Illinois corporation, Associated Mills and Tempco were not dispositive. Given the procedural similarities, Koos controls in this case, and, as the Court did in Koos, this Court will conduct an analysis of Section 1404 (a) factors to determine if transfer is proper.
Black & Decker also contends that transfer is improper under § 1404 (a) because Chicago, not Kentucky, is a more appropriate location for this litigation. Specifically, Black & Decker asserts that Vermont American's activity at the National Hardware Show in Chicago constituted significant, well-planned acts of trademark infringement for which it seeks relief. However, Black & Decker's Complaint is not limited to the alleged infringement in Chicago but alleges infringement throughout the United States. (Black & Decker Complaint, P 18). Just as in Koos, Black & Decker's infringement suit could be brought as a compulsory counterclaim to the declaratory judgment action in Kentucky. The Court finds that both Illinois and Kentucky have proper jurisdiction and venue over the parties and issues involved in this dispute.
Therefore, the issue of transfer must be decided by an evaluation of § 1404 (a) factors: convenience of parties, convenience of witnesses and interests of justice. The Court will address each factor individually.
A. Convenience of Parties
While a plaintiff's choice of forum must be given some weight, that choice is not determinative. See Wysnoski v. Millet, 759 F. Supp. 439, 445 (N.D. Ill. 1991). Here, Black & Decker has neither its headquarters nor principals in Chicago.
By contrast, Vermont American headquarters and principals reside in Kentucky. In addition, the saw blades at issue are manufactured, marketed and distributed from Kentucky.
Significantly, as discussed above, since both parties are national companies and because Black & Decker alleges nationwide infringement, it is clear that Black & Decker could have sought the same relief it seeks here in any other district in the United States. For these reasons, we find that balancing the convenience of the parties overwhelmingly favors Vermont American and Kentucky.
B. Convenience of Witnesses
Vermont American has identified four of its employees who reside in Kentucky as potential witnesses regarding Vermont American's creation, adoption and investigation and use of the "Master Series" mark. Black & Decker has identified three nonparty witnesses (without indicating their residences) as potential witnesses regarding what they saw at Vermont American's booths at the National Hardware Show. Further, Black & Decker alleges that there will be other as yet unknown and unnamed witnesses within this court's subpoena power.
The central issues in this case are: Did Vermont American infringe, and did it damage Black & Decker? Regarding the issue of infringement, Vermont American has argued alternative defenses of abandonment and noninfringement. Black & Decker argues that the defense of abandonment depends "solely on Black & Decker's acts and intent, neither of which occurred in Kentucky." (Black & Decker Response, p. 8). However, neither did these acts occur in Illinois.
Of the named potential witnesses, only those of Vermont American relate in any way to Black & Decker's acts and intent since they propose to testify as to Vermont American's investigation of, and the corporate decision to use, the mark. On the other hand, Black & Decker's potential witnesses, even assuming that they reside within the subpoena power of this Court, reportedly will testify as to what they saw at the National Hardware Show. The Court notes that Vermont American does not dispute that it was at the Show or that it displayed and promoted its "Master Series" saw blades at the Show. This stipulation would essentially render Black & Decker's potential witnesses unnecessary on the issue of what happened at the Show.
On the issue of damage caused by infringement, Black & Decker argues that the critical issue at trial will be whether Vermont American's actions caused consumer confusion. Black & Decker presumably would use the named witnesses for such evidence. However, once again, Black & Decker alleges nationwide infringement; therefore, if the alleged infringement has caused nationwide consumer confusion, Black & Decker would presumably be able to find witnesses to that effect within the subpoena powers of the Western District of Kentucky. In fact, as Weinstein's Declaration avers, "thousands of potential customers [may have] seen [Vermont American's display at the Show]" (Weinstein Decl., P 8).
Given that this Show is acknowledged by both parties to be the largest of its kind, while in 1993 and 1994 53% and 45% of attendees respectively came from a 100 mile radius of Chicago (Irvine Decl., P 2), it is clear that attendees came from all over the United States, indeed, the world.
On the other hand, Vermont American's witnesses, as employees are within the control of Vermont American and no subpoena problems are anticipated. In addition Vermont American asserts that it would be an inconvenience to have those employee/witnesses come to Illinois to testify in this case. Given the proximity, this cannot be a serious challenge to keeping the case here. See Duman v. Crown Zellerbach Corp., 107 F.R.D. 761, 765-66 (N.D. Ill. 1985).
As Black & Decker fails to name any witnesses, party or nonparty, for whom Illinois is a more convenient forum, the balance of convenience rests slightly with Vermont American as the bulk of their witnesses are from Kentucky, even though they are employees.
C. Interests of Justice
This factor primarily embraces judicial economy and efficiency, not the interests of the parties or the merits of the underlying claims. Wysnoski, 759 F. Supp. at 445, citing Coffey, 796 F.2d at 221. Relevant considerations are the presence of related litigation, the relative speed with which a case will get to trial, and the advantage of having a court most familiar with the applicable state law. Wysnoski, 759 F. Supp. at 445.
The parties have indicated that these two complaints constitute the entire litigation on this issue between the parties; therefore, only the latter two factors apply here.
Regarding the congestion of courts, the most recent statistics show that the Western District of Kentucky and the Eastern District of Illinois have an equal backlog (22 months from filing to trial according to the 1994 Federal Court Management Statistics, and 20 months from filing to disposition according to the 1994 Reports of the Proceedings of the Judicial Conference of the U.S.). Therefore, according to these statistics, the issues in this litigation will be resolved at the same rate in either district.
Illinois law will apply in this case due to the pendent state claims in Black & Decker's Complaint. However, the issues involved are not so intricate that this Court would be better able to apply Illinois law than any other federal court. Both State claims arise from statutes and there is no question that the courts of the Western District of Kentucky have access to Illinois statutes and caselaw and are as competent as we are in applying them to the facts of this case.
Therefore, balancing the interests of justice results in no disadvantage to transferring this Complaint to Kentucky.
For all the above mentioned reasons, this Court finds that Vermont American has sustained its burden of establishing factors which favor transfer. Therefore, this Court, by reason of comity and pursuant to Section 1404 (a), recommends transfer of this case to the Western District of Kentucky.
MARTIN C. ASHMAN
United States Magistrate Judge
Dated: September 28, 1995.