Summary
The United States District Court for the District of Maryland considers motions to dismiss in a trademark infringement action brought by Hagerstown Recovery LLC against New Spirit Recovery LLC, Polaris Detox LLC d/b/a Innovo, Treatment Outreach Services Inc., and Jessica Phelan. The court concludes, in the portion provided, that the plaintiff failed to make a prima facie showing of personal jurisdiction over New Spirit and Innovo based on agency or conspiracy theories. The court also addresses motions to seal, granting Innovo’s motion and denying the plaintiff’s motion.
Topics
Practice areas
Questions Presented
- Whether Plaintiff made a prima facie showing that Maryland's long-arm statute authorized personal jurisdiction over New Spirit.
- Whether Plaintiff made a prima facie showing that Maryland's long-arm statute authorized personal jurisdiction over Innovo based on agency or conspiracy theories.
- Whether the exercise of specific personal jurisdiction over New Spirit or Innovo would comport with due process.
- Whether Innovo's agreement with Treatment Outreach should be sealed.
- Whether Plaintiff's opposition papers and supporting memorandum should be sealed in their entirety.
Holdings
- Plaintiff failed to make a prima facie showing of personal jurisdiction over New Spirit under Maryland's long-arm statute because it alleged no facts establishing that Treatment Outreach or Phelan was New Spirit's agent and alleged no facts sufficient to support conspiracy-based jurisdiction.
- Plaintiff failed to make a prima facie showing of personal jurisdiction over Innovo based on actual agency, apparent agency, or conspiracy.
- The additional allegations that New Spirit or Innovo independently directed advertising or had other contacts with Maryland did not establish specific personal jurisdiction because Plaintiff did not identify the applicable long-arm-statute provision and the claims did not arise out of or relate to those contacts.
- Innovo's motion to seal its agreement with Treatment Outreach was granted because the agreement contained confidential competitive business information and the public could understand the court's reasoning from the unsealed briefing.
- Plaintiff's motion to seal its opposition papers was denied because full sealing was disproportionate and Plaintiff failed to explain why redaction would not suffice.
Key quotations
“The tortious act of trademark infringement, however, “takes place in either the place where the infringer commits acts of infringement or in the place where customers are likely to be deceived and confused.”” (15-16)
“Just calling the websites “New Spirit’s agents” is not enough.” (18-19)
“Plaintiff cannot make an argument for apparent authority by pointing only to the actions of the alleged agent.” (23-24)
“The Public Citizen court further explained that: When presented with a motion to seal, the law in this Circuit requires a judicial officer to comply with the following procedural requirements: (1) provide public notice of the sealing request and a reasonable opportunity for the public to voice objections to the motion; (2) consider less drastic alternatives to closure; and (3) if it determines that full access is not necessary, it must state its reasons—with specific findings—supporting closure and its rejections of less drastic alternatives.” (25-26)
Factual background
Hagerstown Recovery operates a Maryland residential addiction-treatment center under the trademark "The Valley." Plaintiff alleged that treatmentpages.com and treatmentadvisors.info used Google advertisements containing "The Valley" and directed prospective Maryland patients to treatment providers New Spirit in California and Innovo in Pennsylvania. Plaintiff alleged that Treatment Outreach Services and Jessica Phelan operated or controlled the websites and acted as agents or co-conspirators of New Spirit and Innovo. Innovo acknowledged an independent-contractor agreement with Treatment Outreach but denied an agency relationship; New Spirit denied any relationship with the website operators.
Procedural history
Plaintiff filed the original complaint on April 17, 2025, and an amended complaint on June 4, 2025. The amended complaint asserted six counts against all defendants. New Spirit and Innovo moved to dismiss under Federal Rules of Civil Procedure 12(b)(2) and 12(b)(6). The court resolved the motions on the papers without a hearing, concluding that Plaintiff failed to make a prima facie showing of personal jurisdiction over either facility defendant. The court also granted Innovo's request to seal its agreement with Treatment Outreach but required Plaintiff to file redacted versions of its opposition papers rather than seal them in full.
Remand instructions
No remand. Plaintiff was ordered to file redacted versions of its opposition and supporting memorandum within fourteen days.