Myco Industries, Inc. v. Blephex, LLC

          OPINION AND ORDER DENYING DEFENDANT'S MOTION TO DISMISS [#15]

          HON. GERSHWIN A. DRAIN UNITED STATES DISTRICT COURT JUDGE.

         I. Introduction

         Before the Court is Defendant's Motion to Dismiss. Defendant asserts that this Court does not have personal jurisdiction over Defendant; there is no case or controversy that needs declaratory judgment; and Plaintiff fails to state facts sufficient to support its claims. For the reasons discussed below, the Court will deny Defendant's Motion.

         II. Factual Background

         Plaintiff Myco Industries, Inc. (“Myco”) is a corporation organized and existing under the laws of Michigan. Dkt. No. 9, pg. 2 (Pg. ID 24). Defendant BlephEx, LLC (“BlephEx”) is a corporation organized under the laws of Florida with its principal place of business located in Tennessee. Id. Mr. John Choate is Myco's Chairman. Dkt. No. 20, pg. 9 (Pg. ID 1184). Dr. James Rynerson is BlephEx's owner and President. Id. In August of 2012, Dr. Rynerson sought out Mr. Choate to design and develop a prototype for a device that could treat blepharitis. Id. at pg. 10 (Pg. ID 1185). Rynerson and Choate formed RySurg LLC (“RySurg”), a Michigan company and the BlephEx's company's predecessor. Id. at pg. 10 (Pg. ID 1185). Mr. Choate modified Dr. Rynerson's device design, developed a prototype, and oversaw the manufacture and commercialization of the final product, named the Blephex. Id. The Blephex removes debris from the eyelid using the ‘718 patent method. Id. at pg. 11 (Pg. ID 1186). It went to market in 2013. Id. Mr. Choate was employed by and served as President of RySurg from December 2012 until January 2014. Dkt. No. 10, pg. 16 (Pg. ID 64). Choate and Rynerson ended their partnership due to financial conflicts. Id. Dr. Rynerson then formed BlephEx, LLC to market the Blephex.

         BlephEx now sells the BlephEx treatment device that is used by healthcare professionals for the treatment of blepharitis. Dkt. No. 15, pg. 13 (Pg. ID 975). Blepharitis is an eyelid disease characterized by the inflammation, scaling, reddening, and crusting of the eyelid, creating dandruff-like scales on the eyelashes. Dkt. No. 9, pg. 3 (Pg. ID 25); Dkt. No. 20, pg. 10 (Pg. ID 1185). Blepharitis can be anterior or posterior. Anterior blepharitis affects the front edge of the eyelid where the eyelashes join it, and posterior blepharitis affects the inner edge of the eyelid. Id.

         From February 20-24 of 2019, both BlephEx and Myco attended the Southern Educational Congress of Optometry (“SECO”) conference in New Orleans, Louisiana. Dkt. No. 10, pg. 17 (Pg. ID 65). The SECO conference allows companies to promote and display their goods and service to thousands of optometric professionals from around the world. Id. Myco began marketing its AB Max tool in 2019 at the SECO conference. Id. The AB Max is a device intended for the treatment of anterior blepharitis only. Id. at pg. 25 (Pg. ID 73). Myco showed the AB Max tool and handed out materials explaining the AB Max's functionality and use at the conference. Id. According to Plaintiff, Dr. Rynerson approached the Myco booth at the conference and stated that the AB Max infringes on his Blephex patent. Id. at pg. 18 (Pg. ID 66). Dr. Rynerson allegedly made this accusation loudly and within earshot of prospective customers. Id. Plaintiff alleges that Dr. Rynerson returned to his BlephEx booth and told optometrists that Myco's AB Max was infringing on his patents and that he would take action. Id. at pg. 19 (Pg. ID 67).

         According to Dr. Rynerson, he approached the Myco booth at the SECO conference and asked Choate if he thought the AB Max might infringe Rynerson's patent. Dkt. No. 15-1, pg. 5 (Pg. ID 996). Rynerson asserts that he did not threaten to sue anyone for patent infringement. Id. He further states that to the best of his recollection, he did not tell doctors and practitioners visiting the BlephEx booth that the AB Max infringed on his patent. Id. at pg. 15 (Pg. ID 977).

         On March 4, 2019, Plaintiff filed a complaint in this Court. Dkt. No. 1. Plaintiff filed an amended complaint on March 14, 2019. Dkt. No. 14. The amended complaint requests a declaratory judgment of non-infringement, a declaratory judgment of invalidity of the ‘718 patent, and asserts federal and common law unfair competition claims. Id. On March 18, 2019, Plaintiff also filed a motion for a preliminary injunction to enjoin Defendant from making patent infringement allegations and threatening litigation against Plaintiff's potential customers. Dkt. No. 11. Defendant opposed the motion for preliminary injunction on April 8, 2019. Dkt. No. 17. Plaintiff replied on April 22, 2019. Dkt. No. 19. On April 8, 2019, Defendant filed a Motion to Dismiss, asserting that this Court does not have personal jurisdiction over Defendant. Dkt. No. 15. Plaintiff opposed the Motion to Dismiss on April 29, 2019. Dkt. No. 20. Defendant replied on May 13, 2019. Dkt. No. 21.

         III. Legal Standard

         Fed. R. Civ. P. 12(b)(6) governs motions to dismiss. The Court must construe the complaint in favor of the plaintiff, accept the allegations of the complaint as true, and determine whether plaintiff's factual allegations present plausible claims. See Fed. R. Civ. P. 12(b)(6). To survive a motion to dismiss, a complaint must “allege enough facts to make it plausible that the defendant bears legal liability.” Agema v. City of Allegan, 826 F.3d 326, 331 (6th Cir. 2016). The facts need to make it more than “merely possible that the defendant is liable; they must make it plausible.” Id. “Bare assertions of legal liability absent some corresponding facts are insufficient to state a claim.” Id. A claim will be dismissed “if the facts as alleged are insufficient to make a valid claim or if the claim shows on its face that relief is barred by an affirmative defense.” Riverview Health Inst., LLC v. Med. Mut. of Ohio, 601 F.3d 505, 512 (6th Cir. 2010).

         Fed. R. Civ. P. 8(a)(2) requires “a short and plain statement of the claim showing that the pleader is entitled to relief” such that the defendant has “fair notice of what the claim is and the grounds upon which it rests.” Bell Atlantic Corp. v. Twonbly, 550 U.S. 544, 554 (2007).

         IV. ...