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Imagize LLC v. Ateknea Solutions Hungary KFT

United States District Court, N.D. California

July 12, 2019

IMAGIZE LLC, Plaintiff,
v.
ATEKNEA SOLUTIONS HUNGARY KFT, et al., Defendants.

          ORDER GRANTING IN PART AND DENYING IN PART MOTION TO DISMISS

          RICHARD SEEBORG, UNITED STATES DISTRICT JUDGE

         I. INTRODUCTION

         Plaintiff Imagize LLC (“Imagize”) brings suit against Defendants Ateknea Solutions Hungary KFT (“Ateknea”), a Hungarian limited liability company, Aero Glass, Inc. (“Aero Glass”), a Delaware corporation, and Akos Maroy for copyright infringement and misappropriation of trade secrets, along with numerous claims based on contract. Maroy moves to dismiss Imagize's complaint for insufficient service of process under Rule 12(b)(5) of the Federal Rules of Civil Procedure. Additionally, Maroy and Aero Glass (collectively “Defendants”) move to dismiss Imagize's copyright infringement claim for failure to state a claim under Rule 12(b)(6) of the Federal Rules of Civil Procedure. For the reasons explained below, Maroy's motion under Rule 12(b)(5) is denied and Defendants' motion under Rule 12(b)(6) is granted.[1]

         II. LEGAL STANDARDS

         A. Service of Process

         Rule 12(b)(5) of the Federal Rules of Civil Procedure authorizes a defendant to move for dismissal of an action for insufficient service of process. Fed.R.Civ.P. 12(b)(5). When a defendant challenges service, the plaintiff bears the burden of establishing the validity of service as governed by Rule 4. See Brockmeyer v. May, 383 F.3d 798, 801 (9th Cir.2004).

         B. Failure to State a Claim

         A complaint must contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). While “detailed factual allegations” are not required, a complaint must have sufficient factual allegations to state a claim that is “plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl. v. Twombly, 550 U.S. 544, 555, 570 (2007)). A claim is facially plausible “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. (citing Twombly, 550 U.S. at 556). This standard asks for “more than a sheer possibility that a defendant has acted unlawfully.” Id. The determination is a context-specific task requiring the court “to draw on its judicial experience and common sense.” Id. at 679.

         A motion to dismiss a complaint under Rule 12(b)(6) of the Federal Rules of Civil Procedure tests the legal sufficiency of the claims alleged in the complaint. See Conservation Force v. Salazar, 646 F.3d 1240, 1241-42 (9th Cir. 2011). Dismissal under Rule 12(b)(6) may be based on either the “lack of a cognizable legal theory” or on “the absence of sufficient facts alleged under a cognizable legal theory.” Id. at 1242 (internal quotation marks omitted). When evaluating such a motion, the court must accept all material allegations in the complaint as true and construe them in the light most favorable to the non-moving party. In re Quality Sys., Inc. Sec. Litig., 865 F.3d 1130, 1140 (9th Cir. 2017). “[C]onclusory allegations of law and unwarranted inferences, ” however, “are insufficient to defeat a motion to dismiss for failure to state a claim.” Caviness v. Horizon Cmty. Learning Ctr., Inc., 590 F.3d 806, 812 (9th Cir. 2010).

         III. DISCUSSION

         A. Service of Process

         Generally, a responsive pleading by a defendant that fails to dispute a defect in service or personal jurisdiction will waive any such defect. See Fed. R. Civ. P. 12(h)(1); see also Benny v. Pipes, 799 F.2d 489, 492 (9th Cir. 1986). The essence of Rule 12-embodied in the combined language of 12(g) and 12(h)-is that a party “who by motion invites the court to pass upon a threshold defense should bring forward all the specified defenses [personal jurisdiction, improper venue, insufficient process, or insufficient service of process] he then has and thus allow the court to do a reasonably complete job.” Fed.R.Civ.P. 12 advisory committee's note, 1966 Amendment, subdivision (h). Thus, if a defendant raises any Rule 12 defenses in his first filing to the court, he is obliged to raise all of those specified in Rule 12(h). Am. Ass'n of Naturopathic Physicians v. Hayhurst, 227 F.3d 1104, 1107 (9th Cir. 2000).

         Here, Maroy wrote in his motion to set aside default, “[P]ersonal jurisdiction does not lie, at least as to Mr. Maroy.” (See Dkt. 39 at 4:6-7.) Maroy, however, says nothing about objecting to service. In Hayhurst, the defendant's failure to raise a personal jurisdiction defense along with its service defense precluded the defendant from raising the personal jurisdiction defense. See Hayhurst, 227 F.3d at 1107. The defenses are different: an objection based on insufficiency of service of process is delineated under Rule 12(b)(5), while one based on “lack of jurisdiction over the person” is set forth under Rule 12(b)(2). Id. By that logic, Maroy's failure to raise an insufficiency of service defense alongside his personal jurisdiction defense precludes him from now contesting the sufficiency of service.

         Maroy raises several objections to a formal reading of this rule. First, he argues that he raised the insufficiency of service in his communications with Imagize prior to litigation, thereby providing it with notice of the defense. Maroy cites no analogous case where notice to a plaintiff was enough to overcome Rule 12's requirements. Second, Maroy asserts that raising service as a potential issue in his Reply in support of his Motion to Set Aside Default was enough to preserve the ...


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