ORDER DENYING DEFENDANTS K&L IMPORTS, INC.; NHW, INC; JOYMAX TRADING, INC.; AND YK TRADING, INC.'S MOTION TO SEVER CLAIMS FOR TRIAL [Dkt. No. 232.]
GONZALO P. CURIEL, District Judge.
On March 8, 2013, Defendants K&L Imports, Inc.; NHW, Inc.; Joy Max Trading, Inc.; and YK Trading, Inc. (collectively "Handbag Defendants") filed a motion to sever claims for infringement of handbag designs from the watch designs for trial. (Dkt. No. 232.)
On April 12, 2013, Plaintiff and AIF Corporation, a Watch Defendant, filed their oppositions. (Dkt. Nos. 242, 243.) On April 23, 2013, Defendant RK Texas Leather Mfg., Inc. filed a notice of joinder in Plaintiff's opposition. (Dkt. No. 244.)
On April 26, 2013, Defendants Joymax Trading, Inc. filed a reply in support of the motion to sever claims. (Dkt. No. 245.) Defendants K & L Imports, Inc., NHW, Inc. and YK Trading, Inc. filed their reply. (Dkt. No. 246.) On April 26, 2013, Defendant Joymax Trading, Inc. ("Joymax") also filed a notice of joinder in Defendants K&L Imports, Inc., NHW, Inc. and YK Trading, Inc.'s reply. (Dkt. No. 247.) The motions are submitted on the papers without oral argument pursuant to Civil Local Rule 7.1(d)(1). After a review of the briefs, supporting documentation, and applicable law, the Court DENIES Handbag Defendants' motion to sever claims for trial.
Plaintiff Brighton Collectibles, Inc. ("Brighton") manufactures and sells women's fashion accessories, including handbags and watches. Plaintiff has registered its hardware designs as copyrights. Handbag Defendants consist of K&L Imports, Inc.; NHW, Inc.; Joy Max Trading, Inc.; and YK Trading, Inc. Watch Defendants include Defendants JCNY and AIF Corporation. Certain copyrighted designs are used on both handbags and watches.
On February 24, 2010, Brighton filed its original complaint against Defendant RK Texas Leather Mfg., Inc. ("Texas Leather"). (Dkt. No. 1.) On December 6, 2010, Texas Leather filed a third party complaint against K&L Import, Inc.; NHW, Inc. d/b/a/ Sense Trading Co.; YK Trading, Inc.; JC NY; Joy Max Trading, Inc.; and AIF Corporation d/b/a Global Time International, Lucky-7 International and Time World. (Dkt. No. 17.)
On February 28, 2011, Plaintiff filed a first amended complaint. (Dkt. No. 51.) On August 31, 2011, Plaintiff filed a second amended complaint against ("SAC") against Defendants Texas Leather; Richard Ohr, Texas Leather's owner; K&L Imports, Inc.; NHW, Inc.; YK Trading, Inc.; Joy Max Trading, Inc.; and AIF Corporation. (Dkt. No. 87.) The SAC alleges causes of action for copyright infringement; trade dress infringement; false designation of origin; common law unfair competition; statutory unfair competition; and trademark infringement. (Id.) On November 8, 2011, Defendant Richard Ohr filed a cross claim against K&L Imports, Inc.; NHW, Inc.; Joy Max Trading, Inc., YK Trading, Inc.; JCNY and AIF Corporation. (Dkt. No. 101.)
On March 8, 2013, Handbag Defendants moved to sever claims for infringement of handbag designs from the watch designs for trial. (Dkt. No. 232.) Brighton, Texas Leather and AIF oppose. (Dkt. Nos. 242, 243, 244.) Handbag Defendants filed a reply. (Dkt. No. 245, 245, 246, 247.)
I. Legal Standard
Under Federal Rule of Civil Procedure ("Rule") 20(a)(2), permissive joinder of defendants is proper if: "(A) any right to relief is asserted against them jointly, severally, or in the alternative with respect to or arising out of the same transaction, occurrence, or series of transactions or occurrences; and (B) any question of law or fact common to all defendants will arise in the action." Fed.R.Civ.P. 20(a)(2)(A). The permissive joinder rule "is to be construed liberally in order to promote trial convenience and to expedite the final determination of disputes, thereby preventing multiple lawsuits." League to Save Lake Tahoe v. Tahoe Reg'l Planning Agency , 558 F.2d 914, 917 (9th Cir. 1997). The purpose of Rule 20(a) is to address the "broadest possible scope of action consistent with fairness to the parties; joinder of claims, parties and remedies is strongly encouraged." United Mine Workers of Am. v. Gibbs , 383 U.S. 715, 724 (1966).
"The same transaction' requirement of Rule 20 refers to similarity in the factual background of a claim; claims that arise out of a systematic pattern of events' and have a very definite logical relationship.'" Hubbard v. Hougland, No. 09-0939, 2010 U.S. Dist. WL 1416691, at *7 (E.D. Cal. Apr. 5, 2010) (quoting Bautista v. Los Angeles County , 216 F.3d 837, 842-843 (9th Cir. 2000)). In addition, "the mere fact that all [of a plaintiff's] claims arise under the same general law does not necessarily establish a common question of law or fact." Coughlin v. Rogers , 130 F.3d 1348, 1351 (9th Cir. 1997). The court has broad discretion to determine whether severance is permitted. Coleman v. Quaker Oats, Co. , 232 F.3d 1271, 1297 (9th Cir. 2000).
However, "even once [the Rule 20(a)] requirements are met, a district court must examine whether permissive joinder would comport with the principles of fundamental fairness' or would result in prejudice to either side." Id. at 1296 (citing Desert Empire Bank v. Insurance Co. of North America , 623 F.2d 1371, 1375 (9th Cir. 1980) (finding that the district court did not abuse its discretion when it severed certain plaintiff's claims without finding improper ...