CALYX CONTAINERS LLC v. KINZIE ADVANCED POLYMERS LLC GROVE BAGS (2026)

ORDER ON DEFENDANT'S MOTION TO DISMISS

This matter is before the Court on Defendant Grove Bags’ Motion to Dismiss pursuant to the First-to-File Rule and Federal Rule of Civil Procedure 12(b)(2). ECF No. 15. For the reasons set forth herein, the motion is DENIED.

BACKGROUND

Colorado-based Plaintiff Calyx Containers, LLC (“Calyx”) and Ohio-based Defendant Kinzie Advanced Polymers LLC, otherwise known as Grove Bags (“Grove Bags”), both produce packaging products (bags and films) to store cannabis, and are direct competitors in the cannabis-packaging market. On August 21, 2025, Calyx sued Grove Bags for False Advertising under 15 U.S.C. § 1125(a), False Patent Markings under 35 U.S.C. § 292, and for a violation of the Colorado Consumer Protection Act, C.R.S. § 6-1-105. ECF No. 1 at 7-8. Calyx alleges that Grove Bags misrepresented that its products were patented to consumers directly and in its online presence, which not only deceived the public but injured Calyx as a market competitor by diverting business and causing it to delay its own development of a competing film-packaging product. Id. These misrepresentations include public remarks made during a podcast appearance by Grove Bags founder and CEO, online advertisements, employee sales scripts and onboarding materials, and testimony from a former employee, Jacob Torrison, detailing misrepresentations he was instructed to make at a Colorado trade show in 2023. Id. at 3-5.

The parties are already well acquainted, as they are engaged in pending litigation in the Northern District of Ohio before Judge Solomon Oliver, Jr., 1:24-cv-01887-SO, and the District of Colorado before Chief Judge Daniel Domenico and Magistrate Judge Cyrus Chung, 1:25-cv-01321-CYC. These pending suits are for claims of tortious interference with a noncompete agreement and misappropriation of trade secrets, which includes an additional named party, Mr. Michael Tatum, who is an ex-Grove Bags employee and current Calyx employee. As of the filing date of the present complaint, the Ohio court had issued a preliminary injunction ruling that Calyx is subject to the Ohio court's jurisdiction. In the other Colorado suit, which relates to the Ohio suit and predates the present one, Grove Bags’ Rule 12(b)(1) motion remains pending. ECF No. 15 at 3.

In response to the present lawsuit, Grove Bags asks this Court, as a matter of discretion, to dismiss this case because the first-to-file rule favors Ohio as the proper venue. Id. at 1. In addition, Grove Bags moves to dismiss this case based on lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(2).¹ Id.

STANDARD OF REVIEW

I. First to File Rule

The first-to-file rule recognizes that federal courts, “as courts of coordinate jurisdiction and equal rank,” must be careful “to avoid the waste of duplication, to avoid rulings which may trench upon the authority of sister courts, and to avoid piecemeal resolution of issues that call for a uniform result.” Buzas Baseball, Inc. v. Bd. of Regents of Univ. Sys. of Ga., 1999 WL 682883, at *2 (10th Cir. 1999) (unpublished) (quoting Sutter Corp. v. P&P Indus., Inc., 125 F.3d 914, 917 (5th Cir. 1997). The rule “permits a district court to decline jurisdiction where a complaint raising the same issues against the same parties has previously been filed in another district.” Id. (citing Alltrade, Inc. v. Uniweld Prods., Inc., 946 F.2d 622, 625 (9th Cir. 1991)).

The first-to-file rule is a rule of abstention, meaning the decision to invoke the first-to-file rule and dismiss the second case is not rigid and rests within the sound discretion of the second court. See Buzas, 1999 WL 682883 at *2. The second court may consider: (1) the chronology of the actions; (2) the similarity of the parties; and (3) the similarity of issues. Wakaya Perfection, LLC v. Youngevity International Inc., 910 F.3d 1118, 1124 (10th Cir. 2018). Additional equitable factors may be considered, such as “extraordinary circumstances, inequitable conduct, bad faith, anticipatory suits, and forum shopping[ ].” Id.

II. Personal Jurisdiction – Fed. R. Civ. P. 12(b)(2)

Under Federal Rule of Civil Procedure 12(b)(2), a court may decline to dismiss a complaint for lack of personal jurisdiction as long as the plaintiff “show[s] that jurisdiction is legitimate under the laws of the forum state and that the exercise of jurisdiction does not offend the due process clause of the Fourteenth Amendment.” Emplrs Mut. Cas. Co. v. Bartile Roofs, Inc., 618 F.3d 1153, 1159 (10th Cir. 2010). Federal Rule of Civil Procedure 4(k)(1)(A) permits federal courts to exercise personal jurisdiction over a defendant “who is subject to the jurisdiction of a court of general jurisdiction in the state where the district is located;” thus, Rule 4(k)(1)(A) implicates Colorado's long-arm statute. Colorado's “long-arm” statute, C.R.S. § 13-1-124, has been interpreted to confer the maximum jurisdiction permitted by constitutional due process. Archangel Diamond Corp. v. Lukoil, 123 P.3d 1187, 1193 (Colo. 2005). Therefore, this Court need only determine whether the exercise of jurisdiction over the defendant comports with due process.

The Due Process Clause “operates to limit the power of a State to assert in personam jurisdiction over a nonresident defendant.” Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 413-14 (1984). In order to comport with the Due Process Clause, the out-of-state defendant must have “minimum contacts” with the forum state such that the exercise of jurisdiction does not “offend traditional notions of fair play and substantial justice.” Int'l Shoe Co. v. State of Wash. Office of Unemployment Comp. and Placement, 326 U.S. 310, 323 (1945).

These contacts may give rise to either general or specific jurisdiction. Old Republic Ins. Co. v. Cont'l Motors, Inc., 877 F.3d 895, 903 (10th Cir. 2017). General jurisdiction arises where the defendant contacts with the forum state are “so continuous and systematic as to render [it] essentially at home” there. Goodyear Dunlop Tires Operation, S.A. v. Brown, 564 U.S. 915, 919 (2011) (quotation marks omitted). By contrast, specific jurisdiction exists where the cause of action is “related to” or “arises out of” the defendant's activities within the forum state. See Helicopteros Nacionales, 466 U.S. at 414. In such cases, specific jurisdiction is proper “where the contacts proximately result from actions by the defendant himself that create a ‘substantial connection’ with the forum state.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985). This inquiry also requires that the Court determine whether defendant “purposefully directed his activities at the residents of the forum.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985). The Calder “effects” test is used to assess “purposeful direction.” Calder v. Jones, 465 U.S. 783 (1984). The test involves a three-pronged analysis: the out-of-state party must have committed (a) an intentional action․, that was, (b) expressly aimed at the forum state․, with (3) knowledge that the brunt of the injury would be felt in the forum state.” Dudnikov v. Chalk & Vermilion Fine Arts, Inc., 514 F.3d 1063, 1072 (10th Cir. 2008).

The plaintiff bears the burden of establishing minimum contacts. OMI Holdings, Inc. v. Royal Ins. Co. of Canada, 149 F.3d 1086, 1091 (10th Cir. 1998). This analysis serves as a safeguard against the out-of-state defendant being haled into court for mere “ ‘random, fortuitous, or attenuated contacts’ with the forum state.” Dudnikov, 514 F.3d at 1071 (quoting Burger King, 471 U.S. at 475)). Once minimum contacts is established, the burden shifts to the defendant to demonstrate “the presence of other considerations that render the exercise of jurisdiction unreasonable.” Alcohol Monitoring Sys., Inc. v Actsoft, Inc., 682 F. Supp. 2d 1237, 1244-45 (D. Colo. 2010) (quoting Inamed Corp. v. Kuzmak, 249 F.3d 1356, 1360 (Fed. Cir. 2001)). “Unreasonableness,” is based on: (1) the burden on the defendant; (2) the forum state's interest in adjudicating the dispute; (3) the plaintiff's interest in obtaining convenient and effective relief; (4) the interstate judicial system's interest in obtaining the most efficient resolution of controversies; and (5) the shared interest of the several states in furthering fundamental substantive social policies. Burger King, 471 U.S. at 467-77.

ANALYSIS

I. The First-to-File Rule

Grove Bags argues that the first-to-file rule requires this Court, in the interest of judicial economy and efficiency, to dismiss this case so that it can be adjudicated in the Northern District of Ohio. ECF 15 at 7. This Court finds that the first-to-file factors and additional equitable factors disfavor dismissing the suit and/or transferring the case to Ohio.

The first factor requires a simple inquiry into filing dates. This factor weighs in favor of Grove Bags because the first lawsuit, filed in the Northern District of Ohio on October 29, 2024, was filed before the second and third lawsuits, which were both filed in the District of Colorado on April 25, 2025, and August 21, 2025, respectively. The second factor also favors Grove Bags. This inquiry does not demand that the parties be identical, just that there is substantial overlap. Shannon's Rainbow, LLC v. Supernova Media, Inc., 683 F.Supp.2d 1261, 1278-79 (D. Utah 2010). Here, the parties do substantially overlap. The first lawsuit involves a dispute between Grove Bags, Calyx, and a former Grove Bags employee and current Calyx employee, Michael Ryan Tatum. ECF No. 15 at 3. The same parties are named in the second lawsuit. And the present lawsuit is between Grove Bags and Calyx only.

Consequently, the crux of the first-to-file analysis centers on the third factor: whether the issues in the three lawsuits are sufficiently similar to warrant application of the rule. The issues need only be “substantially similar,” in that the cases “seek like forms of relief and hinge on the outcome of the same legal/factual issues.” Shannon's Rainbow, 683 F.Supp. 2d at 1279. Though all three cases deal with the same underlying business, the production and marketing of plastic bags and films, the first and second lawsuits involve tortious interference with a noncompete agreement and misappropriation of trade secrets, which are distinct from the claims of false advertising, false patent marking, and consumer protection in the present case. Though the claims do overlap in the sense that the discovery proceedings for the Ohio misappropriation-of-trade-secrets claim may be affected by the present patent-related case, ECF No. 16 at 10, as the public nature of patents is in direct tension with the private nature of trade secrets, that is only a sliver of commonality, which mostly impacts discovery as opposed to the final relief sought.

Grove Bags cites cases from this district to support dismissal, but this Court believes those cases miss the mark. Animal Health Int'l Inc. v. Livingston Enters., Inc. involved a dispute between Animal Health International, a Colorado corporation and vaccine provider, and Livingston Enterprises, a Nebraska pig producer who administered Animal Health's vaccines to its livestock. 2012 WL 1439243 at *1 (D. Colo. Apr. 25, 2012). Livingston sued Animal Health in Nebraska federal court, alleging that the faulty vaccines it received from Animal Health caused significant damage to the pigs and its business. Id. Two months later, Animal Health filed a separate lawsuit against Livingston, this time in Colorado state court, which was removed to federal court, asserting, among other things, breach of contract. Id. The Colorado court ruled that the issues in the two lawsuits were substantially similar, warranting the application of the first-to-file rule, because both suits centered on the parties’ contacts and arose from the same singular vaccine transaction. Id. at *3. The court went on to explain that allowing both suits to proceed simultaneously ran the risk of conflicting rulings and wasting judicial resources. Id.

The facts and holding in Animal Health are distinguishable from this case. The present lawsuit and the first two lawsuits do not center on the same nucleus of law or fact beyond that which arises out of their relationship as market competitors. The present case does not overlap with the legal issues in the first two cases, i.e., employment-contract disputes and tortious interference. Nor does it involve facts relating to Calyx's hiring practices, Grove Bags’ employees, and revealed trade secrets. The issues that do overlap, misappropriation of trade secrets from the first case, and false advertising/false patent marking from the present case, overlap merely in the sense that both involve intellectual property. At this juncture, it seems too conjectural to conclude that entertaining these cases simultaneously would pose a real risk of conflicting rulings or wasted judicial resources.

Similarly inapplicable is 1K1V TGJ Holdings, LLC v. True Gentlemen's Jerky. 2021 WL 5167193 (D. Colo. Oct. 2021). That case involved 1K1V's investment in True, a cured meat and beef jerky company. Id. at *1. True brought several state tort claims against 1K1V, which were then removed to federal court, alleging that 1K1V had interfered with True's financing-agreement negotiations with another company. Id. Three months later, 1K1V brought its own lawsuit in the same state court, alleging various state tort claims and breach of certain promissory notes. Id. True responded that that second case should either be transferred to federal court with the first case or be outright dismissed, as the first-to-file rule applied. Id. The court agreed, explaining that “both actions arise out of the parties’ relationship and consequent duties to one another based on a series of transactions,” therefore the “commonalities dwarf the disparities.” Id. at *3 (citing Animal Health, 2012 WL 1439243 at *4 (D. Colo. Apr. 25, 2012). But the facts and holding in 1K1V are similarly distinguishable from the present case because the dispute between Calyx and Grove Bags does not arise out of a singular transaction or an intimate and ongoing contractual relationship like in 1K1V. Calyx and Grove Bags are market competitors and might dip into the same employee-recruitment well. But there is no single interaction or transaction between them that binds the lawsuits. The allegation that Calyx poached an ex-Grove Bags employee has no connection to the alleged false advertising and patent markings that occurred during the 2023 trade event and its 2024 Colorado sales.

Though consideration of the equitable factors may favors dismissal, most notably because the filing sequence seems like a retaliatory effort to forum shop, the dissimilar subject matter does not. The difference in claims brought is sufficient for this Court to decline to exercise its discretion based on the first-to-file rule.

II. Personal Jurisdiction

The crux of the personal jurisdiction dispute rests on the second prong of the Calder “effects” test: whether the intentional action was expressly aimed at the forum state. Calder, 465 U.S. at 784. Grove Bags argues that its contacts with Colorado do not satisfy minimum contacts for two reasons. First, its contacts with Colorado are so negligible that they fall well below the minimum contacts threshold, and second, these contacts are not expressly aimed at Colorado and therefore do not constitute purposeful direction.

I am not convinced. Grove Bags’ contacts with Colorado are threefold. First, and most importantly, Grove Bags has substantial sales of its allegedly offending product in Colorado. Second, three individuals, one of whom is an important witness in the present case, were employed by Grove but were based in Colorado until the Summer of 2023. Third, Grove allegedly engaged in the wrongful conduct complained of in the present case during its participation in a trade show in Colorado in 2023. These contacts, collectively, are sufficient to support the exercise of personal jurisdiction in Colorado in this case.

Though the Midwest remains its strongest market, Colorado ranks in the upper median of Grove Bags’ national sales. Jaffe, Hearing Tr., 10:7-9, Mar. 6, 2026. Since 2023, the company has generated 4-5% of its total revenue from direct sales to brick-and-mortar stores in Colorado. ECF No. 15 at 14; Jaffe, Hearing Tr., 6:21-22, Mar. 6, 2026. In concrete terms, this amounts to roughly $400,000 of sales in Colorado per year—a “not insignificant” number, according to Grove Bags’ CEO. Jaffe, Hearing Tr., 13:12-20, Mar. 6, 2026.²

These sales were expressly aimed at Colorado, one of the first states to legalize medical and recreational use of marijuana as a matter of state law. See Calder, 465 U.S. at 784 (the defendant's alleged tortious conduct must be “expressly aimed at” and cause “the brunt of that injury be felt” in the forum state). Grove Bags’ sales were not random, fortuitous, unilateral sales initiated by individual Colorado-based consumers. Dudnikov, 514 F.3d 1072. Rather, the sales were for sizeable quantities of its product to specific corporate entities with storefronts in Colorado over the span of several years. Jaffe, Hearing Tr., 6:21-22, Mar. 6, 2026. (“My understanding is it's pretty consistent from 2023 to present. It is about 4 percent.”); see Plant Food Co-Op v. Wolfkill Feed & Fertilizer Corp., 633 F.2d 155, 159 (9th Cir. 1980) (distinguishing between a product sale that is “an isolated occurrence” and a sale that “arises from the efforts of the distributor to serve, directly or indirectly, the market for its products in other states.”). When fulfilling those orders, not only did Grove Bags reasonably foresee that its products would wind up in Colorado, but it fulfilled these wholesale orders because it wanted its product to enter Colorado. See NBA Props. v. HANWJH, 46 F.4th 614, 623 (7th Cir. 2022) (“If the defendant exploits the forum market, it is subject to the jurisdiction of the forum.”); Otter Prods., LLC v. Big Birds, LLC, 2019 WL 13102793 at *1 (D. Colo. Aug. 9, 2019) (finding that defendants made “substantial and regular sales of infringing products bearing Plaintiffs’ trademarks to Colorado,” including “at least fifty such sales” occurring over a three month period); Otter Prods., LLC. v. Phone Rehab, LLC, 2019 WL 4736462 at *4 (D. Colo. Sept. 27, 2019) (finding that plaintiffs established specific personal jurisdiction based on allegations that defendants sold and shipped 341 infringing products to Colorado consumers via Amazon for over a year, in addition to shipping over 1,000 other products to Colorado during the same time period). And indeed, Colorado is one of Grove Bags’ most important markets. Jaffe, Hearing Tr., 10:17, Mar. 6, 2026 (“4 or 5 percent isn't nothing. That's a nice amount of revenue. We certainly wouldn't want to lose that revenue.”).

It can be inferred that if Grove Bags took meaningful steps to introduce its products to the Colorado cannabis market, it must have had the foresight that the “brunt of the injury” caused by its alleged wrongful conduct would also be felt there. See Eighteen Seventy, LP v. Jayson, 32 F.4th 956, 974 (10th Cir. 2022) (“From this, we could reasonably infer that, when the defendants allegedly intended to engage in wrongful conduct that would be harmful to the company's business operations related to the Canadian parent, they necessarily intended for the focal point of their wrongful conduct to be Oklahoma.”).

Notably, so far as the present record shows, most if not all of the products Grove Bags sold to Colorado buyers were affixed with the allegedly false patent marking. Thus, Grove Bags’ targeting of the Colorado market is directly linked to the injury alleged here.

The other contacts with Colorado are relatively minor. Grove Bags employed a small, Colorado-based team up until August of 2023. This Colorado-based workforce supports the conclusion that Grove Bags purposefully directed its activities to Colorado at that time and could “reasonably anticipate” being haled into a Colorado court. However, while the evidence from the testimony of Calyx's CEO was that it had stayed out of the market for several years due to its belief that Grove Bags’ claim that its product was patented and was still preparing to enter the market with competitive products in August 2023, Calyx admits that it did not actually enter the market until November 2023. Also, while Calyx alleges that some of the false statements made in Colorado by Grove Bags employees were made at the NOCO Hemp Expo in 2023, this too took place before Calyx formally entered the market with a competitive product. Grove Bags’ attendance at the Expo, in isolation, is insufficient to support the exercise of personal jurisdiction. See C5 Med. Werks v. CeramTec GmbH, 937 F.3d 1319, 1323 (10th Cir. 2019). However, the fact that Grove Bags engaged in the very conduct that is at issue in this case during the trade show lends some support to a finding that pursuing a claim against Grove Bags for that conduct does not offend traditional notions of fair play and substantial justice.

ORDER

Grove Bags’ motion to dismiss (ECF No. 15) is DENIED.

DATED this 30th day of March, 2026.

FOOTNOTES

1.   In its motion to dismiss, ECF No. 15, Grove Bags references Federal Rule of Civil Procedure 12(b)(1), arguing that this court lacks subject-matter jurisdiction over it. The remainder of the motion to dismiss makes no reference and provides no argument to support a motion under 12(b)(1). Therefore, this court presumes that that reference was made in error and excludes it from this order.

2.   Consistent with many other courts that have grappled with the line-drawing problem of how many sales directed at the forum state are enough to establish personal jurisdiction, this Court similarly eschews giving precise numbers. But it is clear that a small sales-revenue percentage, coupled with other factors, can satisfy specific jurisdiction. See Square D Co. v. Scott Elec. Co., 2008 U.S. Dist. LEXIS 76201, at *28 (W.D. Pa. Sep. 30, 2008) (rejecting defendants’ argument that 24 customers in the forum state with a total of $10,238.25 in sales, which amounted to less than 1% of the company's total sales was insufficient to establish minimum contacts and stating that “[w]hile such an argument is valid in the context of general jurisdiction, in the context of specific jurisdiction it is evidence that supports Plaintiff's argument that the [defendants] purposefully availed themselves of the laws and privileges of Pennsylvania by selling and shipping products to residents of the Commonwealth.”); Michigan Nat'l Bank v. Quality Dinette Inc., 888 F.2d 462, 467 (6th Cir. 1989) (finding general jurisdiction for 171 sales to Michigan, equivalent to 3% of their total sales for that calendar year, plus other factors including that defendant retained a local sales representative, solicited sales in the forum state, conducted mail-order solicitations in the forum state, and completed at least one sale per month in a calendar year); Klearfold, Inc. v. Printex Packaging Corp., 1997 U.S. Dist. LEXIS 21946, at *8 (D.N.J. Jan 14, 1997) (finding general jurisdiction because “[w]hile defendant minimizes this sum by asserting that it represents less than 5% of [defendant's] total sales, both the volume of sales and the percentage which those sales represent are more than sufficient to establish personal jurisdiction, or at least, a prima facie case of personal jurisdiction”).

R. Brooke Jackson United States District Judge