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Nubonau, Inc., Etc v. Nb Labs

March 9, 2012

NUBONAU, INC., ETC.,
PLAINTIFF,
v.
NB LABS, LTD, ETC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Honorablelarryalanburns United States District Judge

ORDER ON DEFENDANTS' MOTIONS TO DISMISS

Still pending in this case are the Defendants' motions to dismiss for lack of personal jurisdiction. Last October, after the motions had been filed but before NuboNau had opposed them, the Court allowed NuboNau to take limited discovery relating to the Defendants' jurisdictional arguments. Specifically, the Court ordered Dotcom Retail to "respond to NuboNau's thirteen document requests and eight interrogatories to the extent they request information regarding contacts with California." (Dkt. No. 24 at 9.) It also ordered Cult Beauty to respond to NuboNau's document requests and interrogatories "with all responses limited to Cult Beauty's contacts in California." (Dkt. No. 24 at 9.) Finally, it ordered NB Labs to produce documents and answer interrogatories regarding its contacts both in California and the United States as a whole.*fn1 After NuboNau had taken the discovery allowed by the Court it filed an opposition to the motions to dismiss, to which Defendants each filed a reply.

As with its request for jurisdictional discovery, NuboNau lumps the Defendants together, at least in the "Legal Argument" portion of its opposition brief. The Court will address their motions to dismiss independently. First, however, it will reiterate the relevant jurisdictional standards.

I. Jurisdictional Standards

When NuboNau first requested jurisdictional discovery, it suggested that the Defendants' California contacts were adequate to establish the Court's personal jurisdiction over them, but that in the alternative the Defendants' national contacts were adequate to establish jurisdiction under the federal long-arm statute, Fed. R. Civ. P. 4(k)(2). It did not distinguish between the Defendants:

Finally, NuboNau should be granted discovery not only to California contacts, but to all national contacts. Although NuboNau firmly believes that it can establish personal jurisdiction in California, should the Court find otherwise, NuboNau could still maintain its federal claims based on Defendants' national contacts across the United States collectively. See Fed. R. Civ. P. 4(k)(2). Where foreign defendants may otherwise have insufficient contacts with any one state, the foreign defendants' contacts with the United States as a whole may be aggregated to establish personal jurisdiction on claims arising under federal law. (Dkt. No. 18-1 at 6.) The Court's allowance of jurisdictional discovery forced NuboNau to change that approach, at least as to Defendants Dotcom Retail and Cult Beauty. Now, because the Court limited NuboNau's discovery from these Defendants to information regarding their contacts in California, NuboNau cannot argue that the Court has jurisdiction over them under Rule 4(k)(2). Instead, it argues strictly that jurisdiction over them exists "in connection with the retail activities of [their] e-commerce business that clearly targets California customers." (Opp'n Br. at 11, 14.) With respect to NB Labs, NuboNau appears to rely only on Rule 4(k)(2). It argues that "specific jurisdiction over NB Labs is proper for claims directly related to its use of the Nubo mark within the United States in a manner that is likely to cause confusion." (Opp'n Br. at 9.)

The "Legal Argument" portion of NuboNau's brief confuses things, however, because there NuboNau appears to argue that jurisdiction exists over all Defendants, not just NB Labs, under Rule 4(k)(2) (even though its analysis is weighted heavily toward the Court's jurisdiction over NB Labs). Indeed, the major subheading in this section is titled "Under Fed. R. Civ. P. 4(k)(2) This Court May Consider Each Defendant's Contacts With The Entire United States." (Opp'n Br. at 15.)Anyway, the Court is assuming that NuboNau believes specific jurisdiction exists over Dotcom Retail and Cult Beauty because of their California contacts, while it exists over NB Labs under Rule 4(k)(2) because of its national contacts.

A. Specific Jurisdiction

Three conditions must be satisfied to trigger the Court's specific jurisdiction over a non-resident defendant.

(1) The non-resident defendant must purposefully direct his activities or consummate some transaction with the forum or resident thereof; or perform some act by which he purposefully avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws;

(2) the claim must be one which arises out of or relates to the defendant's forum-related activities; and

(3) the exercise of personal jurisdiction must comport with fair play and substantial justice, i.e., it must be reasonable.

Yahoo! Inc. v. La Ligue Contre Le Racisme Et L'Antisemitisme, 433 F.3d 1199, 1205--06 (9th Cir. 2006).

"Purposeful direction," the first condition*fn2 , occurs where the defendant (1) commits an intentional act, (2) expressly aimed at the forum state, (3) causing harm that the defendant knows is likely to be suffered in the forum state. Id. at 1206 (citing Schwarzenegger, 374 F.3d at 802. This test, which is traceable to the Supreme Court's decision in Calder v. Jones, 465 U.S. 783 (1984), is an effects test that focuses on where a defendant's acts were felt, rather than where they actually occurred. Yahoo! Inc., 433 F.3d at 1206. The "harm" required need not be the brunt of the harm of the defendant's acts. To the contrary, "[i]f a jurisdictionally sufficient amount of harm is suffered in the forum state, it does not matter that even more harm might have been suffered in another state." Id. at 1207.

The second condition - the claim must arise out of the defendant's forum-related activities - simply means that the defendant's alleged activities must be the "but for" cause of the claim. Bancroft & Masters, Inc. v. Augusta Nat. Inc., 223 F.3d 1082, 1088 (9th Cir. 2000).

Comportment with fair play and substantial justice, the third condition, requires the Court to consider several factors, including: (1) the extent of the defendant's purposeful interjection into the forum state; (2) the burden on the defendant of defending in the forum;

(3) the extent of the conflict with the sovereignty of the defendant's state; (4) the forum state's interest in adjudicating the dispute; (5) the most efficient judicial resolution of the controversy; (6) the importance of the forum to the plaintiff's interest in convenient and effective relief, and (7) the existence of an alternative forum. Id. at 1088. Each factor must be considered, and none is dispositive. Ziegler v. Indian River County, 64 F.3d 470, 475 (9th Cir. 1995).

B. 4(k)(2) Jurisdiction

Rule 4(k)(2) "permits federal courts to exercise personal jurisdiction over a defendant that lacks contacts with any single state if the complaint alleges federal claims and the defendant maintains sufficient contacts with the United States as a whole." Getz v. Boeing Co., 654 F.3d 852, 858 (9th Cir. 2011). For jurisdiction to arise under the Rule, the claim must arise under federal law, the defendant must not be subject to the personal jurisdiction of any state court of general jurisdiction, and the federal court's exercise of personal jurisdiction must comport with due process. Holland America Line Inc. v. Wartsila North America, Inc., 485 F.3d 450, 461 (9th Cir. 2007). The due process analysis under Rule 4(k)(2) is nearly identical to the traditional personal jurisdiction analysis, the ...


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