United States District Court, N.D. California
September 26, 2005.
PRIMAX ELECTRONICS LTD., Plaintiff,
F&G RESEARCH, INC., Defendant.
The opinion of the court was delivered by: JEFFREY WHITE, District Judge
ORDER GRANTING MOTION TO DISMISS FOR LACK OF PERSONAL
JURISDICTION AND DENYING AS MOOT MOTION TO DISMISS FOR LACK OF
SUBJECT MATTER JURISDICTION AND MOTION TO TRANSFER
This matter comes before the Court upon consideration of the
motion to dismiss for lack of personal jurisdiction filed by
Defendant F&G Research, Inc. ("F&G"). Also before the Court are
F&G's motion to dismiss for lack of subject matter jurisdiction
and motion to transfer. In light of the Court's ruling on the
motion to dismiss for lack of personal jurisdiction, those
motions are DENIED AS MOOT.
On July 15, 2005, the Court heard oral argument on each of the
pending motions, granted Plaintiff Primax Electronic Ltd.'s
("Primax") request for discovery on the issue of personal
jurisdiction, and ordered supplemental briefing on that issue.
The parties' supplemental briefing now is complete, and the Court
concludes that no further oral argument is necessary as to that
motion.*fn1 See N.D. Civ. L.R. 7-1(b). Having considered the parties' pleadings, relevant legal
authority, the record in this case, and having had the benefit of
oral argument, the Court GRANTS the motion to dismiss for lack of
FACTUAL AND PROCEDURAL HISTORY
Primax is a Taiwanese corporation, with a principal place of
business in Taiwan. Although Primax is not a California
corporation, it has a wholly-owned subsidiary, Polaris
Electronics, Inc. in Pleasanton, California, and it does business
with a number of companies located in California, including
companies within the Northern District. (See Declaration of
Brian Yang, ¶¶ 2-3).*fn2 Primax's customers within the
United States are original equipment manufacturers ("OEMs").
(Id., ¶ 5.) These OEMs use Primax products but sell them under
their own brand names. (Id.)
F&G is a Florida corporation. It is undisputed that F&G has no
offices, telephone numbers, assets, employees or property in
California, and that F&G's sole business is licensing the patents
On or about February 14, 2005, through its counsel in Florida,
F&G sent a letter to Primax in Taiwan that states that Primax is
"offering for sale and selling a scrolling mouse which may
require a license under F&G's patent(s)." (Complaint, Ex. A.) The
letter further states that "[w]e would appreciate it if you
consider this an invitation to license F&G's patents at our
standard, one-time, fully paid upon, non-refundable license . . .
An indication of no interest will be interpreted by our client
that you wish to continue potentially infringing activities which
may subject your company to liability for patent infringement. We
therefore urge you to contact the undersigned immediately with
your comments or cease and desist from further sales of the
products in question and account to F&G for past sales." (Id.) F&G has also engaged in similar conduct with other companies in
California, including Logitech, Hewlett-Packard, and Kye
International.*fn3 (See, e.g., Declaration of Debra Nye in
Support of Plaintiff's Supplemental Brief Regarding Personal
Jurisdiction ("Nye Decl."), Exs. A (Response to Interrogatory No.
2), D (Cease and Desist Letters); Supplemental Declaration of
Debra Nye ("Nye Supp. Decl."), Ex. A.) The terms and conditions
of those licenses have not been made a part of the record.
On April 22, 2005, Primax initiated this declaratory relief
action against F&G.
A. Motion to Dismiss for Lack of Personal Jurisdiction
1. Primax bears the burden of establishing that the Court has
jurisdiction over F&G.
A defendant may move for dismissal for lack of personal
jurisdiction prior to trial. Fed.R.Civ.P. 12(b)(2). A court
can decide the motion on the basis of affidavits and declarations
submitted in response to the motion, or it can hold an
evidentiary hearing. See Electronics for Imaging, Inc. v.
Coyle, 340 F.3d 1344, 1349 (Fed. Cir. 2003).*fn4 Regardless
of the procedure a court chooses, a plaintiff bears the burden of
establishing a court's jurisdiction over a defendant.
If a court determines that it will resolve a motion to dismiss
for lack of personal jurisdiction "based on affidavits and other
written materials in the absence of an evidentiary hearing, a plaintiff need only to make a prima facie showing
that defendants are subject to personal jurisdiction."
Electronics for Imaging, 340 F.3d at 1349. In that situation, a
court must take uncontroverted allegations in a complaint as true
and resolve factual conflicts in a plaintiff's favor. Id.; see
also Akro Corp. v. Luker, 45 F.3d 1541, 1543 (Fed. Cir. 1995).
2. F&G must have certain minimum contacts with the forum
"Personal jurisdiction over an out-of-state defendant is
appropriate if the relevant state's long arm-statute permits the
assertion of jurisdiction without violating federal due process."
3D Systems, Inc. v. Aarotech Laboratories, Inc., 160 F.3d 1373,
1376-1377 (Fed. Cir. 1998); see also Akro, 45 F.3d 1541.
California's long arm statute is co-extensive with federal due
process requirements and, thus, the jurisdictional analyses under
California law and federal due process are the same. 3D
Systems, 160 F.3d at 1377. This Court must determine whether F&G
has "minimum contacts" with this forum such that the exercise of
jurisdiction "does not offend traditional notions of fair play
and substantial justice." International Shoe Co. v. Washington,
326 U.S. 310, 316 (1945).
The concept of minium contacts encompasses two types of
jurisdiction: general and specific. Primax relies solely on the
latter to establish jurisdiction over F&G.*fn5 Specific
jurisdiction over a defendant exists where: (1) the defendant has
purposefully directed his or her activities at residents of the
forum state or the forum state itself; (2) the plaintiff's claim
arises out of or relates to those activities; and (3) the
assertion of personal jurisdiction is reasonable and fair. See
3D Systems, 160 F.3d at 1378.
With respect to the first prong of this test,
[i]n general, there must be "some act" by which
defendants "purposefully avail?" themselves of the
"privilege of conducting activities within the forum
State, thus invoking the benefits and protections of
its laws.". . . The contacts made by defendants must
therefore by their actions create a "substantial
connection" to the forum state where defendants
have deliberately "engaged in significant activities
within a State" or have "created `continuing
obligations' between [themselves] and residents of
the forum and "proximately result from the actions by
the defendant[s] themselves," such that it is it is
"presumptively not unreasonable to require
[defendants] to submit to the burden of litigation in
that forum as well."
Electronics for Imaging, 340 F.3d at 1350 (quoting Burger King
Corp. v. Rudzewicz, 471 U.S. 462
, 475-76 (1985)).
3. Primax has not met its burden to show the Court has
jurisdiction over F&G.
The Federal Circuit has held that sending cease and desist
letters which threaten infringement litigation, without more,
does not confer personal jurisdiction over a non-resident
defendant. See Silent Drive, 326 F.3d at 1202, 1206. Therefore,
in order to meet its burden to show jurisdiction exists, Primax
must make a prima facie showing that F&G did more than send a
letter to Primax that threatened infringement.
Primax argues it has met its burden by relying on the fact that
F&G has engaged in similar conduct with California companies and
has entered into license agreements with those companies. Primax
relies heavily on the Federal Circuit's decision in Akro,
supra, in support of this argument. In Akro, however, in
addition to sending a cease and desist letter to the plaintiff,
the defendant entered into an exclusive license with one of
plaintiff's competitors, also a resident of the forum, and the
terms of the agreement created continuing obligations between the
defendant and its licensee. Id. at 1546.
Primax also relies on Deprynyl Animal Health, Inc. v.
University of Toronto Innovations Foundation, 297 F.3d 1343
(Fed. Cir. 2002). (See Docket No. 37, List of Additional
Authorities.) In the Deprynyl case, however, the defendant
entered into a license agreement with the plaintiff, a forum
resident. As in Akro, the terms of the license agreement
created a continuing obligation between the defendant and a forum
The Court also finds the facts in this case to be
distinguishable from the facts supporting jurisdiction in
Electronics For Imaging. In that case, the additional
activities that the Federal Circuit found supported a finding of
purposeful direction also were directed at the plaintiff itself,
rather than other forum residents. For example, the defendants
entered into a non-disclosure agreement with the plaintiff, which
was governed by the forum state law and created continuing obligations to the plaintiff in the forum after it had expired,
and defendants repeatedly visited plaintiff's facilities in the
forum to demonstrate the technology underlying the
patents-in-suit. In addition, the defendants hired counsel within
the forum state to prosecute the patents-in-suit. See
Electronics For Imaging, 340 F.3d at 1351; see also Inamed
Corporation v. Kuzmak, 249 F.3d 1356 (Fed. Cir. 2001) (finding
personal jurisdiction where non-resident defendant had negotiated
and entered into license agreements relating to patents-in-suit
with the plaintiff).
In this case, by contrast, the licenses on which Primax relies
are with other California companies, rather than with it.
Moreover, the terms and conditions of those licenses are not
before the Court. As such, there is no evidence in the record to
suggest that F&G has created continuing obligations with
residents of this forum.
The Court also concludes that Primax has not demonstrated that
this action arises out of F&G's licensing activities with other
forum companies. While there is no doubt that the declaratory
relief action arose because of F&G's threat of infringement, and
although Primax contends that it has received requests for
indemnification from its customers with whom F&G has entered into
licenses, Primax's complaint cannot be read to suggest that this
action arose from F&G's licensing activities with Primax
customers, rather than from the direct threat of infringement F&G
made to Primax. To the extent Primax is asserting that the Court
could find that F&G's activities satisfy the "effects" test set
forth in Calder v. Jones, 465 U.S. 783 (1984), the Court
Under that test, a court can exercise jurisdiction over a
non-resident defendant who has committed an intentional act, the
act is expressly aimed at the forum state, and the act causes
harm that the defendant knows is likely to be suffered in the
forum state. See, e.g., Silent Drive, 326 F.3d at 1204-05. In
Calder, the Supreme Court emphasized that the "effects" of the
defendants acts, out of which the litigation arose, were designed
to harm the plaintiff, who was a resident of the forum state.
The Court finds that Primax has not demonstrated that, to the
extent F&G has been seeking licenses from California companies,
it knew or intended that these acts would cause harm to Primax,
a Taiwanese company, in California. See Calder, 465 U.S. at 788
("Here, the plaintiff is the focus of the activities of the
defendants out of which the suit arises."); id. at 789 ("California is the focus point both of the story and of the harm
suffered."). The Court does not read Calder so broadly as to
permit the exercise of jurisdiction over a non-resident defendant
without a showing that the defendant engaged in acts that were
intentionally designed to cause harm to a particular plaintiff in
the forum state. Accordingly, the Court concludes Primax has not
set forth a prima facie showing of personal jurisdiction.
For the reasons set forth above, F&G's motion to dismiss for
lack of personal jurisdiction is GRANTED. The Clerk is directed
to close the file.
IT IS SO ORDERED.
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