Do You Need To Threaten Litigation To Trigger Declaratory Judgment Subject Matter Jurisdiction?

IP Blog - 1_9_19

No.Erbaviva, LLC, a California LLC, sent a demand letter to Era Organics, a Florida company.  The letter identified a number of Erbaviva federal trademark registrations, and "request[ed]" Era Organics:

  1. Request the USPTO expressly abandon certain Era Organics trademark registrations;
  2. Permanently refrain from using ERA ORGANICS, or any similar mark, in connection with certain goods;
  3. Provide written assurances Era Organics will comply with these "requests"

The letter then concluded:

Provided we receive Era Organics' full and prompt cooperation, as well as confirmation that the above action has been performed, our client is prepared to give Era Organics a reasonable amount of time to transition to a new company name/trademark and sell through its remaining inventory.

The letter demanded compliance within 11 days.

Instead of changing the name it had been using for at least 4 years, Era Organics filed suit, seeking a declaratory judgment that there was no trademark infringement.  Erbabviva sought dismissal, arguing there was no jurisdiction to hear the dispute, as there was no "actual controversy."  Erbabviva argued its letter did not create any such dispute:

Nowhere in the letter did Defendant threaten litigation or suggest that it intended to take any formal action.  To the contrary, Defendant indicated that it was concerned about confusion in the marketplace and expressed a willingness to work with Plaintiff on resolving the dispute informally and amicably.  Plaintiff never responded to Defendant's letter but instead rushed to Court to file the present action.  In doing so, Plaintiff effectively jumped the gun.

The Court was not persuaded:

Defendant's letter described the likelihood of confusion between its products as "substantial" and "perhaps inevitable," and requested that Plaintiff cancel its federal trademarks and "permanently refrain" from using its own mark, among other things.  Dkt. 1, p. 14.  An actual controversy exists.

Motion To Dismiss for Lack of Jurisdiction, Denied
Era Organics, Inc. v. Erbaviva, LLC, Case No. 8:18-CV-2219-T-30SPF (M.D. Fla. Jan 4, 2019) (J. Moody)

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