SAYLOR, District Judge.
This is an action for a declaratory judgment that plaintiff TomTom, Inc. has not infringed three patents owned by defendant Norman IP Holdings, LLC. TomTom is a Massachusetts corporation with a principal place of business in Concord, Massachusetts. Norman is a Texas limited liability company with a principal place of business in Texas. After Norman sued TomTom for patent infringement in the United States District Court for the Eastern District of Texas, TomTom filed a complaint in this Court seeking a declaratory judgment of non-infringement.
Norman moved, under Fed.R.Civ.P. 12(b)(2), to dismiss the complaint for lack of personal jurisdiction. On July 26, 2012, Magistrate Judge Judith Dein issued a Report and Recommendation in which she concluded that the motion should be granted.
TomTom filed a timely objection to the Report and Recommendation. Upon de novo review, the Court adopts the Report and Recommendation of the Magistrate Judge in its entirety. With respect to the specific objections raised by TomTom, the Court writes separately only to underscore several points.
TomTom objects to four factual findings regarding the lack of business contacts between defendant and Massachusetts, as well as to the failure to find that Norman is a non-practicing entity created solely for the purpose of enforcing patent licenses through litigation. However, those findings are consistent with the complaint, which alleges only that Norman has "transacted business in this state by, amongst other activities, initiating patent infringement litigation against TomTom." (Compl.¶ 3). Neither the remainder of the complaint nor the filings related to the motion to dismiss suggest any specific "other activities" in Massachusetts; rather, TomTom contends that serving as a
With respect to Norman's retention of Massachusetts-based counsel for out-of-state patent litigation — a fact that is accepted as true for these purposes — there was no error in the Magistrate Judge's determination that such activities do not form a basis for specific jurisdiction. The cases TomTom cites in its objection to the Report and Recommendation stand only for the proposition that a patentee may establish minimum contacts in a state when it hires counsel for the enforcement or defense of the patent in that state's courts. Avocent Huntsville Corp. v. Aten Int'l Co., 552 F.3d 1324, 1339 (Fed.Cir. 2008) (finding no personal jurisdiction where defendant's enforcement activities took place outside the forum state, and plaintiff failed to allege that defendant had attempted to enforce its patents-in-suit in any court in the forum). Radio Sys. Corp. v. Accession, Inc., 638 F.3d 785, 792 (Fed. Cir.2011) ("We made clear in Avocent that enforcement activities taking place outside the forum state do not give rise to personal jurisdiction in the forum, and that decision is controlling here."). Here, all of Norman's enforcement actions have been commenced elsewhere. Those actions do not constitute sufficient minimum contacts with Massachusetts to support the exercise of personal jurisdiction. See Radio Systems, 638 F.3d at 789.
For those reasons, the Court agrees with the Magistrate Judge that TomTom has established neither the existence of personal jurisdiction nor a "colorable case" for personal jurisdiction that is sufficient to warrant jurisdictional discovery under United States v. Swiss Am. Bank, Ltd., 274 F.3d 610, 637 (1st Cir.2001). See also Boit v. Gar-Tec Products, Inc., 967 F.2d 671, 681 (1st Cir.1992) (noting that jurisdictional discovery may be suitable "where the plaintiff had been diligent and was somewhat unfamiliar with his adversary's business practices"); Whittaker Corp. v. United Aircraft Corp., 482 F.2d 1079, 1086 (1st Cir.1973) (finding the same, where "complex factual matters are in question").
Accordingly, and for the foregoing reasons, the Court adopts the Report and Recommendation of the Magistrate Judge. The Motion to Dismiss filed by Defendant Norman IP Holdings, LLC, is GRANTED.
DEIN, United States Magistrate Judge.
Plaintiff TomTom, Inc. ("TomTom"), a Massachusetts corporation, has brought this action against Norman IP Holdings, LLC ("Norman"), a Texas corporation and the purported owner of numerous patents, including U.S. Patent Nos. 5,530,597 (the "'597 Patent"), 5,502,689 (the "'689 Patent"), and 5,608,873 (the "'873 Patent"). After Norman sued TomTom for patent infringement in the United States District Court for the Eastern District of Texas, TomTom filed its complaint in this court seeking a declaratory judgment that it has not infringed, and has not committed any acts which would give rise to liability for infringement, of any properly construed, valid and/or enforceable claims of the 597, 689 or 873 Patents.
The matter is presently before the court on "Norman IP Holdings, LLC's Motion to Dismiss for Lack of Personal Jurisdiction" (Docket No. 8), by which the
"On a motion to dismiss for want of personal jurisdiction, the plaintiff ultimately bears the burden of persuading the court that jurisdiction exists." Astro-Med, Inc. v. Nihon Kohden Am., Inc., 591 F.3d 1, 8 (1st Cir.2009), and cases cited. However, where, as here, "the district court's disposition as to the personal jurisdiction question is 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 [the defendant is] subject to personal jurisdiction." Elecs. for Imaging, Inc. v. Coyle, 340 F.3d 1344, 1349 (Fed.Cir.2003). The court, in evaluating whether the plaintiff has met this burden, "must accept the uncontroverted allegations in the plaintiffs complaint as true and resolve any factual conflicts in the affidavits in the plaintiffs favor." Id. Applying this standard to the instant case, the relevant facts are as follows.
The plaintiff, TomTom, is a Massachusetts corporation having a principal place of business in Concord, Massachusetts. (Compl. ¶ 1). TomTom is in the business of manufacturing global positioning devices, and claims to be a leading producer of such devices. (See id. ¶ 6; Pl. Opp. Mem. (Docket No. 12) at 3). The defendant, Norman, is a limited liability company which was founded in 2010. (Mancinelli Decl. ¶¶ 1, 3). It is organized under the laws of the State of Texas, and is the purported owner of numerous patents, including the '597, '689 and '873 Patents at issue in this case (the "Patents-in-Suit"). (Id. ¶ 3; Compl. ¶ 2). According to Norman, the company maintains a principal place of business in Tyler, Texas. (Mancinelli Decl. ¶ 3). However, it does not appear to have any full-time employees or operations at that location. (See Collins Decl. ¶¶ 4-7).
The record shows that Norman is not licensed to do business in Massachusetts, has no employees and pays no taxes here, and maintains no offices, places of business or other facilities in the Commonwealth. (Mancinelli Decl. ¶ 7). Nor does the defendant own property, maintain any post office boxes, bank accounts or telephone listings, or have a registered agent for service of process in Massachusetts. (Id.). Additionally, Norman has never voluntarily submitted to the jurisdiction of any court or administrative tribunal in Massachusetts, has not executed or performed any contracts in the Commonwealth, and to the best of its knowledge, none of its employees reside in Massachusetts or have ever traveled to the State in order to conduct business on its behalf. (Id. ¶¶ 5, 6, 8). Moreover, according to Norman's Managing Director, the company does not manufacture, offer for sale or sell any products in the Commonwealth, does not ship any products into the forum, does not advertise any products directly to the Massachusetts market, and has no regular channels for customer service here. (Id. ¶ 5, 7). Whether this is due to the fact that Norman's only business activities involve the licensing and enforcement of patents that it owns, as the plaintiff argues, or whether it is due to the fact that Norman chooses not to conduct such operations in Massachusetts, is unclear from the record.
Despite the fact that Norman does not hold itself out as doing business in Massachusetts, TomTom contends that the defendant and the predecessor assignee of the Patents-in-Suit, Saxon Innovations, LLC ("Saxon"), have conducted business in this forum by working repeatedly with lawyers at the Boston office of Pepper Hamilton LLP to file lawsuits for infringement, allegedly of the Patents-in-Suit. (Pl. Opp. Mem. at 2). The record shows that attorneys from Pepper Hamilton's Boston office represented Saxon in six separate patent infringement actions that Saxon filed against various defendants, although the suits were not filed in Massachusetts, but rather in the Eastern District of Texas. (Pl. Ex.B-G). It appears that Norman was substituted for Saxon as the plaintiff in one of those actions after Saxon's involvement was terminated on August 11, 2010, and that Saxon's Boston counsel continued to represent Norman until the case was closed on April 27, 2011. (Pl. Ex.F). However, TomTom has not provided any evidentiary support for its assertion that these infringement actions concerned any of the Patents-in-Suit.
TomTom argues that Saxon's contacts with Boston counsel should be considered in assessing whether this court has personal jurisdiction over Norman because Saxon is allegedly Norman's "predecessor." However, apart from presenting evidence indicating that Norman shares vacant office space with Saxon in Tyler, Texas, TomTom has not put forth any facts regarding the nature of the relationship between
The record establishes that in 2010, Norman was represented by lawyers from Pepper Hamilton's Boston office in connection with a lawsuit filed against it in the United States District Court for the Southern District of California. (Pl. Ex. A). During the course of the litigation, Norman filed a motion to dismiss or transfer venue to the Eastern District of Texas in which it stated that all of its documents, including those pertaining to the validity of the patents at issue in that matter, were located at its headquarters in Tyler, Texas or at the offices of its counsel in Boston, Massachusetts. (Id.). While TomTom argues that the California matter involved one of the same patents that is at issue in the present case, it has not presented any evidence to support that contention. (See Pl. Opp. Mem. at 2). TomTom contends that the fact that Norman reported that documents were located at its counsel's office in Massachusetts constitutes a significant contact for purposes of establishing personal jurisdiction over Norman in this court.
Additional factual details relevant to this court's analysis are described below where appropriate.
Norman argues that this case should be dismissed because it has not had sufficient contacts with Massachusetts to render it amenable to suit in this forum. "Determining whether personal jurisdiction exists over an out-of-state defendant involves two inquiries: whether a forum state's long-arm statute permits service of process, and whether the assertion of personal jurisdiction would violate due process." Avocent Huntsville Corp. v. Aten Int'l Co., Ltd., 552 F.3d 1324, 1329 (Fed. Cir.2008) (quoting Inamed Corp. v. Kuzmak, 249 F.3d 1356, 1359 (Fed.Cir.2001)). The Massachusetts long-arm statute, Mass. Gen. Laws ch. 223A, § 3 (2000), authorizes jurisdiction over the person to the limits allowed by the federal Constitution.
Due process requires the court to determine whether the defendant has maintained "certain minimum contacts" with the forum state "such that the maintenance of the suit does not offend `traditional notions of fair play and substantial justice.'" Int'l Shoe Co. v. Wash., 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463, 61 S.Ct. 339, 343, 85 L.Ed. 278 (1940)). "Jurisdiction is proper ... where the contacts proximately result from actions by the defendant himself that
"Under the `minimum contacts' test, a defendant may be subject to either specific jurisdiction or general jurisdiction. Specific jurisdiction `arises out of or `relates to' the cause of action even if those contacts are `isolated and sporadic.'" Id. (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472-73, 105 S.Ct. 2174, 2182, 85 L.Ed.2d 528 (1985)). "General jurisdiction arises when a defendant maintains `continuous and systematic' contacts with the forum state even when the cause of action has no relation to those contacts." Id. (quoting Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414-16, 104 S.Ct. 1868, 1872-73, 80 L.Ed.2d 404 (1984)). In the instant case, TomTom has alleged only that Norman is subject to specific personal jurisdiction. (Compl.¶ 3). However, it argues that Norman's past business dealings with its Boston lawyers are extensive enough to establish general jurisdiction. (Pl. Opp. Mem. at 5). Therefore, this court will consider whether the defendant may be subject to personal jurisdiction under either standard.
"The assertion of general jurisdiction comports with due process when two criteria are met. First, there must be continuous and systematic general business contacts between the foreign defendant and the forum. Second, the plaintiff must show that the exercise of jurisdiction would be reasonable." United States v. Swiss Am. Bank, Ltd., 274 F.3d 610, 619 (1st Cir.2001) (internal quotations and citation omitted). See also Hockerson-Halberstadt, Inc. v. Propet USA, Inc., 62 Fed. Appx. 322, 337-38 (Fed.Cir.2003) (unpub.op.) (considering whether defendant's contacts with forum were continuous and systematic, and applying fairness analysis in determining whether court had general jurisdiction over defendant under Federal Circuit law). Because the record does not establish that Norman has maintained continuous and systematic business contacts with Massachusetts, the plaintiff has failed to meet the criteria necessary for general jurisdiction.
"Neither the United States Supreme Court nor [the Federal Circuit] has outlined a specific test to follow when analyzing whether a defendant's activities within a state are `continuous and systematic.' Instead, a court must look at the facts of each case to make such a determination." LSI Indus. Inc., 232 F.3d at 1375. The factors that courts consider in assessing whether a defendant's activities are sufficient to establish general jurisdiction include, but are not limited to:
3M Innovative Props. Co. v. InFocus Corp., No. Civ. 04-0009 JNE/JGL, 2005 WL 361494, at *2 (D.Minn. Feb. 9, 2005)
In the instant case, the record shows that Norman maintains no offices, employees or operations in Massachusetts, does not manufacture, sell or advertise any products here, does not solicit business in the Commonwealth, and does not otherwise hold itself out as doing business in the forum. (See Mancinelli Decl. ¶¶ 5-7). Nevertheless, TomTom asserts that Norman's past dealings with Pepper Hamilton are sufficient to establish general jurisdiction over the defendant. (Pl. Opp. Mem. at 5). Specifically, it contends that Norman and Saxon were represented by attorneys from the Boston office of Pepper Hamilton in at least seven other lawsuits involving the Patents-in-Suit. It further argues that because Norman's business consists solely of litigating patents, its contractual arrangements with Pepper Hamilton constitute some of the company's main contractual relationships. (Id.).
This court finds that TomTom's arguments lack both legal and factual support. As an initial matter, TomTom has not cited to any authority in which a court has invoked general jurisdiction over a company because it hired attorneys in the forum in order to litigate matters elsewhere. See In re Chocolate Confectionary Antitrust Litig., 602 F.Supp.2d 538, 567 n. 29 (M.D.Pa.2009) (declining to predicate general jurisdiction on defendant's retention of counsel to effectuate transactions which fail on their own to establish such jurisdiction). The Supreme Court has long held that the existence of a contractual relationship between a non-resident defendant and a forum resident, without more, is insufficient to establish minimum contacts for purposes of personal jurisdiction. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 478, 105 S.Ct. 2174, 2185, 85 L.Ed.2d 528 (1985) ("If the question is whether an individual's contract with an out-of-state party alone can automatically establish sufficient minimum contacts in the other party's home forum, we believe the answer clearly is that it cannot."). Therefore, TomTom has not shown that Norman's relationship with Pepper Hamilton's Boston office alone is sufficient to support general jurisdiction.
Furthermore, TomTom has not alleged any facts or presented any evidence to support its contention that Norman is engaged in the business of litigating patents or that its relationship with Pepper Hamilton has been crucial to its business. In fact, there is evidence in the record that Norman has been represented by non-Massachusetts counsel as well. (See, e.g., Pl. Ex. F). Moreover, TomTom has failed to establish that Saxon's conduct should be imputed to Norman. While "courts have recognized that the jurisdictional contacts of a predecessor corporation may be imputed to its successor corporation without offending due process[,]" courts also "have determined that an assignee does not step automatically into the shoes of an assignor for purposes of personal jurisdiction." Purdue Research Found. v. Sanofi-Synthelabo, S.A., 338 F.3d 773, 783-84 (7th Cir.2003). There is nothing in the record indicating whether Norman is a successor to Saxon rather than an assignee of its patents. Accordingly, TomTom's assertion
Even attributing Saxon's contacts with Pepper Hamilton to Norman and assuming that the attorney-client relationship involved various communications between Norman and its Boston-based attorneys, the maintenance of relevant documents at the attorneys' offices, and possibly visits by Norman personnel to the Boston offices of Pepper Hamilton, Norman's contacts with Massachusetts still would be more limited than in other cases where the defendant's contacts were deemed inadequate to support the assertion of general jurisdiction.
Where, as here, the defendant is not subject to general personal jurisdiction, the district court may nevertheless exercise specific jurisdiction, provided the plaintiff is able to satisfy the three-prong test employed by the Federal Circuit. Accordingly, "the plaintiff must show that the defendant purposely directed its activities at residents of the forum and that the plaintiff's claim arises from or relates to those activities. In addition, the plaintiff must satisfy the court that the assertion of personal jurisdiction under the circumstances
In the context of cases involving claims for declaratory judgment of noninfringement, the Federal Circuit has held that "not all of a patentee's activities in the forum state are sufficient to create a basis for asserting personal jurisdiction." Radio Sys. Corp., 638 F.3d at 789. Rather, the court has explained "that an action for a declaratory judgment `arises out of or relates to activities of the defendant patentee in enforcing the patent or patents in suit,' and that the relevant inquiry for specific jurisdiction is `to what extent ... the defendant patentee purposefully directed such enforcement activities at residents of the forum and the extent to which the declaratory judgment claim arises out of or relates to those activities.'" Id. (quoting Avocent Huntsville Corp., 552 F.3d at 1332). "Thus, only those activities of the patentee that relate to the enforcement or defense of the patent can give rise to specific personal jurisdiction for such an action." Id.
The Federal Circuit also has held that the sending of cease and desist letters to alleged infringers is not sufficient enforcement activity to support a finding of specific jurisdiction; rather the defendant must have "engaged in `other activities' that relate to the enforcement or the defense of the validity of the relevant patents." Avocent Huntsville Corp., 552 F.3d at 1334 (emphasis in original). Examples of such "other" activities "include initiating judicial or extra-judicial patent enforcement within the forum or entering into an exclusive license agreement or other undertaking which imposes enforcement obligations with a party residing or regularly doing business in the forum." Id. Accordingly, the Federal Circuit has determined that specific jurisdiction exists in various situations where the defendant entered into exclusive license agreements with residents of or companies doing business in the forum, as well as in cases where the defendant files a lawsuit in the forum in order to enforce the patent that is the subject of the declaratory judgment action. See id. at 1334-35 (citing cases). Neither of those situations is present in this case, however, and TomTom has not established that Norman engaged in activities in Massachusetts that "relate to the enforcement or the defense of the validity of the relevant patents." Id. at 1334 (emphasis omitted). Merely suing a resident of Massachusetts in another forum is not sufficient.
TomTom argues that Norman's infringement action against it in Texas, and its use of a Boston law firm to carry out its patent enforcement litigation in Texas and to defend its lawsuit in California, are sufficient to satisfy the test for specific personal jurisdiction. (Pl. Mem. at 4-8). However, this court finds that under the controlling authority of the Federal Circuit, such activity does not establish the minimum contacts necessary to confer specific
The fact that Norman retained Massachusetts counsel in order to enforce and defend its patent rights does not alter this court's conclusion that personal jurisdiction is lacking. As described above, there is no allegation that Pepper Hamilton represented Norman in connection with any Massachusetts litigation, and TomTom has not shown that Pepper Hamilton took any other steps, or engaged in any communications, aimed at enforcing Norman's patent rights here. At most, Pepper Hamilton may have done research or drafted pleadings, or engaged in other legal work in Massachusetts for use in Norman's out-of-state litigation. Since the sending of cease and desist letters into a forum state is insufficient to satisfy due process requirements, it is impossible to conclude that preparing materials in Massachusetts for filing elsewhere constitutes sufficient contacts to establish jurisdiction in Massachusetts. There are no allegations that Pepper Hamilton even engaged in any direct communications with any residents of Massachusetts in connection with its representation of Norman. Contrast Elecs. for Imaging, Inc. v. Coyle, 340 F.3d 1344, 1350-51 (Fed.Cir.2003) (finding that out-of-state defendants' contacts were "purposely directed" at California where defendants, who were prosecuting a patent, hired California counsel to engage in numerous communications with California plaintiff regarding the progress of defendants' patent application, solicited California plaintiffs purchase of their business, sent two representatives to plaintiffs California facility to demonstrate technology and, after the patent issued, threatened plaintiff with infringement litigation). TomTom has not identified any cases which hold that in a declaratory judgment action for non-infringement, a client's jurisdiction can be established merely on the basis of where its counsel is located, and no such cases have been found. Therefore, Norman's use of Boston counsel does not subject it to personal jurisdiction in this court.
The court's decision in PharmaNet is inconsistent with the Federal Circuit's holding that "enforcement activities taking place outside the forum state do not give rise to personal jurisdiction in the forum[.]" Radio Sys. Corp., 638 F.3d at 792. While perhaps not expressly stated, since the Federal Circuit has expressly ruled that the sending of a cease and desist letter into a forum does not establish jurisdiction in that forum, it is obvious that the relevant "enforcement activities" are where the litigation was taking place, not where the behind-the-scenes work was being done. See Avocent Huntsville Corp., 552 F.3d at 1339 (finding that Alabama court had no personal jurisdiction over out-of-state defendant where plaintiff made no allegation that defendant attempted to enforce its patents in any Alabama court). Because Federal Circuit law is controlling here, TomTom has failed to make a prima facie showing that Norman is subject to personal jurisdiction in Massachusetts.
Finally, TomTom requests leave to take jurisdictional discovery in the event this court finds that additional facts are required to establish personal jurisdiction over Norman in Massachusetts. (Pl. Opp. Mem. at 6 n. 2). "[A] diligent plaintiff who sues an out-of-state corporation and who makes out a colorable case for the existence of in personam jurisdiction may well be entitled to a modicum of jurisdictional discovery if the corporation interposes a jurisdictional defense." Swiss Am. Bank, 274 F.3d at 625 (quotations and citations omitted).
For all the reasons detailed herein, this court concludes that Norman's contacts with Massachusetts are not adequate to subject it to personal jurisdiction in this court. Accordingly, this court recommends to the District Judge to whom this case is assigned that "Norman IP Holdings, LLC's Motion to Dismiss for Lack of Personal Jurisdiction" (Docket No. 8) be ALLOWED.
