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First Classics, Inc. v. Jack Lake Productions, Inc.

United States District Court, N.D. Illinois

March 22, 2018

FIRST CLASSICS, INC., a Delaware corporation, Plaintiffs,
v.
JACK LAKE PRODUCTIONS, INC., a Canadian corporation, and JAAK JARVE, an individual, Defendants.

          MEMORANDUM AND ORDER

          SHARON JOHNSON COLEMAN United States District Court Judge

         Plaintiff, First Classics, Inc, (“First Classics”) brought this action against Defendants, Jack Lake Productions, Inc. (“JLP”) and Jaak Jarve (“Jarve”) for trademark infringement, trademark dilution, a preliminary injunction under federal law, and breach of contract under Illinois law. Defendants moved to dismiss Plaintiff's Complaint for failure to comply with the Illinois Business Corporation Act, and pursuant to Federal Rules of Civil Procedure 12(b)(2) and 12(b)(6). For the following reasons, Defendants' Motion to Dismiss is granted, in part, and denied, in part.

         Background

         First Classics is a Delaware corporation that produces, prints, distributes, and sells comic books and graphic novels out of Chicago, Illinois. First Classics owns the trademark for “Classics Illustrated” and “Classics Illustrated Junior” (collectively, “Trademarks”), which includes the design and style of the words, letters, and numbers associated with the names. Although Plaintiff's right to transact business in Illinois lapsed in 1992, First Classics filed an application to reinstate its authorization on August 22, 2017.

         JLP is a Canadian corporation operating in Toronto, Canada. Jarve, President of JLP, is a Canadian Citizen. Plaintiff contends that this Court has personal jurisdiction over Defendant Jarve because he conducted extensive communications, negotiated, and transacted business in Illinois that resulted in the execution of the Limited License Agreement (the “License Agreement”) as well as other contracts between the Parties. They also allege that there is jurisdiction because Defendants actively marketed and sold the infringing products to Illinois residents and the entire United States via its interactive website.

         On November 25, 2002, the Parties entered into the Licensing Agreement, where Defendants paid Plaintiffs in order to reprint, distribute, and sell certain comic books and graphic novel titles containing the Trademarks for a ten year period. The Licensing Agreement contained a forum selection clause that restricted venue for any litigation “touching upon the subject matter of this agreement” to any court in Chicago, Illinois. Jarve signed the Licensing Agreement on behalf of JLP, notating his role as President beneath his signature. After the licensing period expired in September of 2013, Defendants continued to reproduce, market, and sell comic books and graphic novels with marks similar or identical to Plaintiff's Trademarks without First Classic's authorization through the point that Plaintiffs filed suit against Defendants on March 16, 2017.

         Discussion

         Defendants move to dismiss Plaintiff's four Count Complaint alleging various trademark violations pursuant to 805 ILCS 5/13.70(a), as well as Federal Rules of Civil Procedure 12(b)(2) and 12(b)(6). For the following reasons, Defendants' Motion is granted, in part, and denied, in part.

         Lack of Standing

         As a threshold issue, Defendants move to dismiss First Classics' Complaint because they allege that Plaintiff's lack the capacity to sue in an Illinois court since they were not in compliance with the Illinois Business Corporation Act (“IBCA”) at the time of filing. See 805 ILCS 5/13.70(a).

         The IBCA restricts a foreign corporation that does business in Illinois without authorization from being able to maintain civil actions in the State's courts. 805 ILCS 5/13/70(a). Upon filling an application to reinstate authorization, however, “the corporate existence for all purposes shall be deemed to have continued without interruption from the date of the issuance of the certificate of dissolution, and the corporation shall stand revived with such powers, duties and obligations as if it had not been dissolved.” 805 ILCS 5/12.45. Further, “all acts and proceedings of its shareholders, directors, officers, employees, and agents, acting or purporting to act in that capacity, and which would have been legal and valid but for such dissolution, shall stand ratified and confirmed.” Id.

         Although it is true that when Plaintiff filed its Complaint it was not authorized to transact business in Illinois, a fact which could have prohibited this suit, Plaintiff's subsequent application for authorization in August of 2017 cured any impediment to bring suit under IBCA. Accordingly, the Court rejects this basis for dismissal.

         Personal Jurisdiction against Jarve

         Jarve moves to dismiss all claims against him individually based on a lack of personal jurisdiction. Once a defendant moves to dismiss a complaint under Federal Rule of Civil Procedure 12(b)(2), the plaintiff must set forth a prima facie case of personal jurisdiction. Purdue Research Found. v. Sanofi-Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir. 2003). In determining whether Plaintiff has ...


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