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Being sued by a Manufacturer in CA and we're in MO

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stlproinc

Junior Member
We are a C-Corp located in MO. We buy and sell retail goods from retail stores at sale or sometimes very discounted rates. We resell these goods on Amazon.com. We have received a claim against us in a Superior Court in CA, filed by a manufacturer claiming false advertising because we are selling the goods as new, but we are not an authorized dealer and therefore the warranty on the goods is not valid. I have done some research and I see that they do have a legal argument there.

However, my question relates to where they can sue us. Can they sue us in CA even though we have no real presence there? We sell on Amazon.com and thus we do sell to CA residents and ship items there, but we don't have a physical presence in CA and we only have a physical presence in MO and are licensed and formed in MO. They are suing us in relation to a CA state law that is slightly more strict, in it's interpretation of the disclosure mandated to state that the goods we are selling don't come with the manufacturer's warranty. They are also suing us under a federal law, section 43(a) of the Lanham Act. Can they sue us in CA like that and or can we easily get this suit moved to MO or thrown out?

Also, they just e-mailed us a copy of the filing, don't they have to serve us properly?

We will probably end up settling with the corporation, but I'd like to know how much leverage I have with regards to the case.

I very much appreciate any advice given.
 


quincy

Senior Member
We are a C-Corp located in MO. We buy and sell retail goods from retail stores at sale or sometimes very discounted rates. We resell these goods on Amazon.com. We have received a claim against us in a Superior Court in CA, filed by a manufacturer claiming false advertising because we are selling the goods as new, but we are not an authorized dealer and therefore the warranty on the goods is not valid. I have done some research and I see that they do have a legal argument there.

However, my question relates to where they can sue us. Can they sue us in CA even though we have no real presence there? We sell on Amazon.com and thus we do sell to CA residents and ship items there, but we don't have a physical presence in CA and we only have a physical presence in MO and are licensed and formed in MO. They are suing us in relation to a CA state law that is slightly more strict, in it's interpretation of the disclosure mandated to state that the goods we are selling don't come with the manufacturer's warranty. They are also suing us under a federal law, section 43(a) of the Lanham Act. Can they sue us in CA like that and or can we easily get this suit moved to MO or thrown out?

Also, they just e-mailed us a copy of the filing, don't they have to serve us properly?

We will probably end up settling with the corporation, but I'd like to know how much leverage I have with regards to the case.

I very much appreciate any advice given.
Yes, the manufacturer can sue you in California. By selling goods on the internet, you open yourself up to claims filed in any state where your ads are accessed and the goods sold. Jurisdiction can always be argued so, yes, you could potentially get the suit moved to Missouri. It is unlikely, however, that the suit would be dismissed with prejudice if the suit has merit ("with prejudice" meaning that the plaintiff is barred from filing again). What would be more likely is, if you were to be successful with your motion to dismiss, the court could dismiss the California suit without prejudice, allowing the manufacturer to refile the legal action against you in Missouri.

What your motion to dismiss would probably do is delay the action filed against you and increase the costs of the suit, but it could save you from having to travel to California to defend against the suit.

If you admit to false advertising, settling now with the manufacturer stands to save you money. I am not sure you have much of a defense to the action, based on what you have posted here, but you can review all facts with an attorney in your area to determine better what your best course of action is.

Good luck.


edit to add:
Here are links to Section 43(a) of the Lanham Act (15 US Code Section 1125a), False designations of origin and false descriptions forbidden (both links lead to the same information so you can pick one or the other):
http://www.bitlaw.com/source/15USC/1125.html
http://www.law.cornell.edu/uscode/text/15/1125
 
Last edited:

LdiJ

Senior Member
We are a C-Corp located in MO. We buy and sell retail goods from retail stores at sale or sometimes very discounted rates. We resell these goods on Amazon.com. We have received a claim against us in a Superior Court in CA, filed by a manufacturer claiming false advertising because we are selling the goods as new, but we are not an authorized dealer and therefore the warranty on the goods is not valid. I have done some research and I see that they do have a legal argument there.

However, my question relates to where they can sue us. Can they sue us in CA even though we have no real presence there? We sell on Amazon.com and thus we do sell to CA residents and ship items there, but we don't have a physical presence in CA and we only have a physical presence in MO and are licensed and formed in MO. They are suing us in relation to a CA state law that is slightly more strict, in it's interpretation of the disclosure mandated to state that the goods we are selling don't come with the manufacturer's warranty. They are also suing us under a federal law, section 43(a) of the Lanham Act. Can they sue us in CA like that and or can we easily get this suit moved to MO or thrown out?

Also, they just e-mailed us a copy of the filing, don't they have to serve us properly?

We will probably end up settling with the corporation, but I'd like to know how much leverage I have with regards to the case.

I very much appreciate any advice given.
I agree with Quincy's answer but I will add that I don't think that email is a valid method of service...that is certainly questionable. However, its quite possible that you will get actual service via the mail.
 

quincy

Senior Member
I agree with Quincy's answer but I will add that I don't think that email is a valid method of service...that is certainly questionable. However, its quite possible that you will get actual service via the mail.
Courts can, and have, allowed for service of a summons and complaint via email. Whether this was proper service in stlproinc's case, however, is a question mark.
 

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