MICHAEL P. SHEA, District Judge.
Plaintiff Gerald D. Brittle ("Brittle") is suing defendant Graymalkin Media, LLC ("Graymalkin") for copyright infringement and tortious interference with a contract or business expectancy, alleging that without his authorization, Graymalkin published
Except where otherwise indicated, these facts are taken from the relevant portions of the complaint.
Co-defendant Lorraine Warren (who lives in Connecticut and has not joined in the motion to dismiss for lack of jurisdiction) and her late husband were paranormal investigators. In November 1978, the Warrens entered into an agreement with Brittle regarding publishing rights to a book authored by Brittle about the Warrens' investigations that was to be titled The Demonologist (the "Collaboration Agreement"). The Collaboration Agreement provided, among other things, that "[a]ll contracts for ... rights in and to [The Demonologist] ... shall require unanimous consent of [Mr. Brittle] and [Mrs. Warren and Mr. Warren]." The Collaboration Agreement was amended in 1990 and remains in effect. The first edition of The Demonologist was published in December 1980 by Prentice-Hall, Inc. Subsequent editions have been released, including a 2002 release by iUniverse.
In June 2013, Graymalkin's owner David Zindel ("Zindel") telephoned Brittle, who lives in Virginia, to inform him that Graymalkin would be the new publisher of The Demonologist. Zindel said that Graymalkin had arranged the deal with Warren, through her son-in-law Tony Spera ("Spera") (another co-defendant who lives in Connecticut and did not join in the motion to dismiss). Brittle protested because he had never consented to the change in publisher. Brittle reviewed the publishing contract proposed by Graymalkin and rejected it. In July 2013, Zindel sent Brittle a letter in which he claimed that Warren was entitled to sell rights to The Demonologist as long as profits were shared with Brittle. Over the next several months, Brittle and Zindel discussed a potential agreement as to The Demonologist but were unable to reach an agreement. In April 2014, Zindel emailed Brittle and claimed that under copyright law Warren owned two-thirds of The Demonologist and that Warren told Zindel that no collaboration agreement was ever signed.
Graymalkin went forward with publishing a new version of The Demonologist. Brittle claims that "Graymalkin advertises on its official website that it `distribute[s] to over 75,000 retailers, libraries, and distribution partners worldwide'" and that "Graymalkin claims that it `distribute[s] to over 100,000 retailers, libraries, and distribution partners worldwide'" as recently as January 14, 2015. Brittle Aff. ¶¶ 12, 13. He also claims that "Graymalkin has shipped to and is currently offering for sale the unauthorized version of my `The Demonologist' in Barnes & Noble retail outlets in: (i) Westport, Connecticut; (ii) Manchester, Connecticut; (iii) North Haven, Connecticut; and (iv) Milford, Connecticut." Id. ¶ 14. He also attaches printouts of Barnes & Noble's website showing the newest version of The Demonologist available for sale in those Connecticut locations. Exhs. C-E to Brittle Aff.
Zindel claims that he is the sole managing member of Graymalkin, which is a
Although Zindel admits that he communicated with Spera, a Connecticut resident, and entered into an agreement with Warren, also a Connecticut resident, to publish The Demonologist, he was never present in Connecticut during the communications. Id. ¶ 10. Graymalkin began publishing the book in July 2013. Id. ¶ 11. Zindel says that Graymalkin's website contains no physical address or phone number, does not display The Demonologist, and does not offer consumers the option to purchase books directly from the site. Id. ¶ 15. According to Zindel, Graymalkin does limited advertising, none of it directed at or conducted in Connecticut, and although Graymalkin has a modest social media presence, it has mentioned The Demonologist in only a few Facebook postings in March 2014.
"[The] plaintiff bears the burden of showing the court has jurisdiction over the defendant," and the "burden is apportioned based on how far the case has progressed." Corning Inc. v. Shin Etsu Quartz Products Co., 242 F.3d 364, at *2 (2d Cir.2000). "If the defendant is content to challenge only the sufficiency of the plaintiff's factual allegation, in effect demurring by filing a Rule 12(b)(2) motion, the plaintiff need persuade the court only that its factual allegations constitute a prima facie showing of jurisdiction." Ball v. Metallurgie Hoboken-Overpelt, S.A., 902 F.2d 194, 197 (2d Cir.1990). "If the defendant asserts in a Rule 56 motion that undisputed facts show the absence of jurisdiction, the court proceeds, as with any summary judgment motion, to determine if undisputed facts exist that warrant the relief sought." Id. "If the defendant contests the plaintiff's factual allegations, then a hearing is required, at which the plaintiff must prove the existence of jurisdiction by a preponderance of the evidence." Id. Where a plaintiff defeats a motion to dismiss through a prima facie showing of jurisdiction, the defendant may be permitted to renew the motion after discovery is completed, at which point jurisdiction is determined on the basis of the evidence in the record. See, e.g., A Slice of Pie Prods., LLC v. Wayans Bros. Entm't, 392 F.Supp.2d 297, 304 (D.Conn.2005); Gomez v. ISB LTEE Ltd., 920 F.Supp. 275, 275 (D. Conn.1995).
"The district court has considerable procedural leeway in deciding 12(b)(2) motions, and it may accept affidavits if it so chooses," and "[w]here ... the district court relies solely on the pleadings and supporting affidavits, the plaintiff need only make a prima facie showing of jurisdiction." Corning, 242 F.3d 364, at*2 (quotation marks omitted). "[W]here the issue is addressed on affidavits, all allegations are construed in the light most favorable to the plaintiff and doubts are resolved in the plaintiff's favor." Whitaker
"To determine personal jurisdiction over a non-domiciliary in a case involving a federal question, the Court must engage in a two-step analysis."
Brittle has made a sufficient prima facie showing that Connecticut's long-arm statute supplies jurisdiction over this case. That statute provides, in relevant part:
Conn. Gen.Stat. § 52-59b(a) (emphasis added).
Accepting Brittle's allegations as true and resolving all doubts in his favor at
Courts applying New York's equivalent long-arm provision in similar cases have held that "[c]opyright infringement is deemed to take place at the point of consumer purchase"
At this stage in the proceedings, when the Court lacks evidence detailing the nature of Graymalkin's arrangements with its distributors and the extent of its involvement in the Connecticut sales, Brittle is entitled to the benefit of the doubt in making his prima facie case that Graymalkin was sufficiently involved in the allegedly tortious sales to be reached by Connecticut's long-arm statute. Whitaker, 261 F.3d at 208 ("[W]here the issue is addressed on affidavits, all allegations are construed in the light most favorable to the plaintiff and doubts are resolved in the plaintiff's favor."). Resolving doubts against Graymalkin is particularly warranted here, given that Graymalkin, by the selective manner in which it has responded to Brittle's allegations, has skirted key issues regarding its distribution arrangements and whether it has arranged to serve Connecticut's market through intermediaries. Graymalkin's denials pertain specifically to directly shipping to and selling in Connecticut, leaving the reader to infer by negative implication that Graymalkin
Further, even if, for the sake of argument, the site of Graymalkin's allegedly tortious conduct were instead where it supplied the books to Barnes & Noble — and therefore potentially outside Connecticut
As to the in-state injury, the situs of a commercial injury is generally where the plaintiff experiences a loss of business, not where the plaintiff resides, despite the fact that the plaintiff may, while in his home state, subsequently feel the economic impact of the lost business. Penguin Grp. (USA) Inc. v. Am. Buddha, 16 N.Y.3d 295, 921 N.Y.S.2d 171, 946 N.E.2d 159, 164-65 (2011) ("In Sybron, we made clear that a tort committed outside the state that was likely to cause harm through the loss of business inside the state was sufficient to establish personal jurisdiction regardless of whether damages were likely recoverable or even ascertainable.") (citing Sybron Corp. v. Wetzel, 46 N.Y.2d 197,
Brittle has made a sufficient prima facie showing of an in-state injury by alleging that because Graymalkin's unauthorized version is offered for sale in Connecticut, "it is likely the [sic] consumers are being diverted from purchasing legitimate copies of `The Demonologist.'" Brittle Aff. ¶ 15. Further, because the Court resolves doubts about the nature of Graymalkin's arrangements with its distributors in Brittle's favor at this stage, there has been a prima facie showing that Graymalkin expected or should have expected that Brittle would be injured, i.e., that he would lose sales, in Connecticut. See, e.g., Halas v. Dick's Sporting Goods, 105 A.D.3d 1411, 1412-13, 964 N.Y.S.2d 808 (N.Y.App.Div. 2013) ("[D]efendant should have reasonably expected that its negligence would have consequences in individual states, including New York, because its distributor targets the nationwide market.... While the [product] was not specifically earmarked for use in New York, defendant sold it to a company that distributes products to states across the country, including New York.").
Brittle's allegations also constitute a sufficient prima facie showing that the requirements of the Due Process Clause have been satisfied.
"So long as a commercial actor's efforts are `purposefully directed' toward residents of another State, we have consistently rejected the notion that an absence of physical contacts can defeat personal jurisdiction there." Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985). "But a defendant's
Sufficient minimum contacts exist under the Due Process Clause where, as here, an out-of-state defendant is sued in connection with the in-state sale of products by a third-party distributor, where there is evidence that the defendant attempted to serve the state's market through the distributor, even in the absence of an express agreement to deliver the products into that specific state. In Kernan v. Kurz-Hastings, Inc., 175 F.3d 236 (2d Cir.1999), a manufacturer was sued for products liability after selling an allegedly defective machine to a third-party distributor based in Pennsylvania, who then sold the machine in New York. The manufacturer moved to dismiss for lack of personal jurisdiction, claiming that it was "a corporation existing under the laws of Japan with its principal place of business in Japan," was "not licensed or registered to do business in New York," had "[n]ever directly transacted or solicited business in New York," had "never provided any services nor entered into any contract in New York," and "had no specific knowledge of what would become of the ... machine after it was sold to [the distributor] in Pennsylvania, beyond the general knowledge that [the distributor] would resell it somewhere in Pennsylvania or one of the other 49 states in the United States." Id. at 239 (quotation marks omitted). The Second Circuit found that New York nonetheless had specific jurisdiction over the manufacturer because it had entered into an exclusive sales agreement with the distributor, "which contemplate[d] that [the distributor] w[ould] sell [the manufacturer's] machines in North America and throughout the world" and "serve[d] as evidence of [the manufacturer's] attempt to serve the New York market, albeit indirectly," id., and therefore was "the type of purposeful action sufficient to support a finding of minimum contacts," id. at 244.
According to Brittle's allegations, read in the light most favorable to him and with doubts about the nature of Graymalkin's distribution arrangements resolved in his favor, Graymalkin supplied infringing copies of The Demonologist to Barnes & Noble in contemplation of the fact that they would be distributed to consumers nationwide, including in Connecticut. This constitutes a prima facie showing of sufficient minimum contacts for Connecticut to assert specific jurisdiction over Graymalkin in a suit arising from the alleged infringement that occurred when the books were offered for sale in Connecticut. See Kernan, 175 F.3d 236; Blakeman v. The Walt Disney Co., 613 F.Supp.2d 288, 303 (E.D.N.Y.2009) ("Because plaintiff has alleged that [defendants] supplied the plaintiff's work to distributors with the knowledge that the resulting infringing work would be disseminated in New York, the Court finds that, if these allegations are proven, it would be reasonably foreseeable to them that they would be subject to suit in New York State and they would have been purposefully availing themselves of the privilege of conducting activities in this State.").
For the reasons above, defendant Graymalkin Media, LLC's Motion to Dismiss (ECF No. 23) is DENIED without prejudice to renewal if discovery demonstrates that personal jurisdiction is lacking.