The opinion of the court was delivered by: William Q. Hayes United States District Judge
The matter before the Court is the Motion to Dismiss filed by Defendants RA Medical Systems, Inc. and Dean Irwin. (Doc. # 5).
On December 2, 2008, Plaintiff, Photomedex Inc. (Photomedex), filed this action pursuant to the Declaratory Judgment Act, 28 U.S.C. § 2201, seeking a declaration that Photomedex did not act with malice in bringing an underlying federal action against the Defendant, RA Medical Systems (RA Medical), and an order restraining RA Medical from instituting any action against Photomedex for malicious prosecution based upon the underlying federal action. Complaint, p. 5. The Complaint alleges that on October 30, 2008, RA Medical issued a press release "announcing the filing of a lawsuit against PhotoMedex for malicious prosecution based on the Underlying Federal Action." Id. at 3. The Complaint alleges that RA Medical has not served Plaintiff with the malicious prosecution complaint and that any lawsuit for malicious prosecution by RA Medical would be premature and subject to dismissal on the grounds that the underlying federal action is still pending on appeal. Id. The Complaint alleges that RA Medical threatened a malicious prosecution lawsuit in order to damage Photomedex's business and did so by issuing the press release on the same day that Photomedex had scheduled an earnings call with investors. Id. The Complaint seeks a declaratory judgment declaring that Photomedex did not act with malice in bringing and pursuing the underlying federal action. Id. at 4.
The Complaint alleges that on January 6, 2004, Photomedex filed the underlying federal action against RA Medical for alleged violations of Section 1125 of the Lanham Act and Business and Professions Code Sections 17500 and 17200 in the United States District Court, Southern District of California, case number 04CV24. Complaint, p. 2. The Complaint alleges that on October 29, 2007, the District Court granted RA Medical's motion for summary judgment in the underlying federal action on grounds that Photomedex lacked standing to pursue the claims asserted. Id. The Complaint alleges that after the Court granted RA Medical's motion for summary judgment, RA Medical filed a motion pursuant to Section 35(a) of the Lanham Act, seeking attorney's fees in the amount of $280,000; and that the court denied the motion for attorney's fees, holding that Photomedex "presented legitimate arguments and that there was no showing that the claims by Photomedex were groundless, unreasonable, vexatious, or brought in bad faith." Id. at 2-3. The Complaint alleges that an appeal in the underlying federal action has been filed, but that the Court of Appeals has not yet scheduled oral arguments. Id. at 3.
On December 23, 2008, RA Medical filed the Motion to Dismiss this action, pursuant to Federal Rules of Civil Procedure, Rules 12(b)(1) and 12(b)(6). (Doc. # 5). On January 12, 2009, Photomedex filed the Opposition to the Motion to Dismiss. (Doc. # 6). On January 16, 2009, RA Medical filed a Reply in Support of the Motion to Dismiss. (Doc. # 10).
CONTENTIONS OF THE PARTIES
RA Medical contends that this declaratory judgment action filed by Photomedex should be dismissed for lack of subject matter jurisdiction and failure to state a claim because the action fails to meet the requisite amount in controversy, fails to state a justiciable claim ripe for adjudication, and presents no actual case or controversy.
Photomedex contends that the requisite amount in controversy is satisfied because RA Medical previously sought over $280,000 in attorney's fees resulting from the underlying federal action.*fn1 Photomedex contends that an actual controversy ripe for adjudication exists before this Court because RA Medical has threatened Photomedex with a malicious prosecution lawsuit in an attempt to damage its business.
I. Motion to Dismiss for Lack of Subject Matter Jurisdiction Amount in Controversy
A suit may be dismissed under Rule 12(b)(1) of the Federal Rules of Civil Procedure where there is a "lack of jurisdiction over the subject matter." Fed. R. Civ. P. 12(b)(1). "The basic statutory grants of federal-court subject-matter jurisdiction are contained in 28 U.S.C. §§ 1331 and 1332. Section 1331 provides for 'federal-question' jurisdiction, § 1332 for 'diversity of citizenship' jurisdiction." Arbaugh v. Y & H Corp., 546 U.S. 500, 513 (2006); 28 U.S.C. §§ 1331-1332. "A plaintiff properly invokes § 1331 jurisdiction when she pleads a colorable claim 'arising under' the Constitution or laws of the United States. She invokes § 1332 jurisdiction when she presents a claim between parties of diverse citizenship that exceeds the required jurisdictional amount, currently $75,000." Arbaugh, 546 U.S. at 513 (citing 28 U.S.C. §§ 1331-1332). The party which invokes jurisdiction bears the burden of demonstrating its existence. Kokkonen v. Guardian Life Ins. Co. Of Am., 511 U.S. 375, 377 (1994).
RA Medical asserts that this Court lacks subject matter jurisdiction on the grounds that the Complaint fails to show that the claim meets the requisite amount in controversy. RA Medical contends that this Court does not have subject matter jurisdiction because Photomedex has failed to allege the $75,000 amount in controversy required under 28 U.S.C. § 1332(a)(1). RA Medical contends that Photomedex does not seek monetary damages but seeks only an equitable determination through the Declaratory Relief Act, under 28 U.S.C. § 2201. RA Medical contends that ...