L.A. Gem and Jewelry Design, Inc. v. Ashley Jewels et al

Filing 38

MINUTES OF Motion Hearing held before Judge Christina A. Snyder: The Court DENIES Defendants' Motion to Dismiss Plaintiff's Amended Complaint 27 . Court Reporter: Laura Elias. (gk)

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

Present: The Honorable 

CHRISTINA A. SNYDER, U.S. DISTRICT JUDGE 

Attorneys Present for Plaintiff: 

N/A 

Tape No.

Attorneys Present for Defendants: 

Milord Keshishian 

Jeffrey Kobulnick

Connie Lee 
Deputy Clerk 

Proceedings:  

Laura Elias 
Court Reporter / Recorder

Michael Bernet 
DEFENDANTS’ MOTION TO DISMISS PLAINTIFF’S
AMENDED COMPLAINT (Dkt. 27, filed Nov. 11, 2017)

I.

INTRODUCTION

On March 29, 2017, plaintiff L.A. Gem & Jewelry Design, Inc., a California
corporation, filed a complaint against defendants An & Associates Co. Inc., a Canadian
corporation (“An & Associates”), and its principals and/or owners Amar Gandhi and
Nirav Gandhi. Dkt. 1. On June 9, 2017, plaintiff filed the operative amended complaint
against defendants. Dkt. 13 (“FAC”). The FAC alleges that all defendants are citizens
and residents of Canada. Id. ¶¶ 6-8. Plaintiff alleges that defendants have infringed
plaintiff’s copyright in certain jewelry by marketing, selling, and distributing identical or
substantially similar jewelry. See FAC.
Plaintiff asserts two claims: (1) copyright infringement in violation of the
Copyright Act, 17 U.S.C. § 101 et seq., and (2) contributory or vicarious copyright
infringement. Id.
On November 2, 2017, defendants filed the instant motion to dismiss plaintiff’s
FAC, Dkt. 27 (“MTD”) and submitted declarations from Amar Gandhi (“Amar Decl.”)1
and Nirav Gandhi (“Nirav Decl.”). Plaintiff filed its opposition on November 13, 2017,
Dkt. 27 (“Opp’n”), and submitted declarations from Nicolas Anwandter (“Anwandter

1

Because two defendants share the same last name the Court will refer to them and
their declarations by their first name.

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

Decl.”) and Charity Graham (“Graham Decl.”) as well as evidentiary objections2.
Defendants filed a reply on November 20, 2017 (“Reply”), and submitted additional
declarations from Amar (“Amar Suppl. Decl.”) and Nirav (“Nirav Suppl. Decl.”), a
request for judicial notice,3 Dkt. 33, a response to plaintiff’s evidentiary objections, Dkt.
34, as well as their own evidentiary objections to plaintiff’s evidence, Dkt. 35. On
November 27, 2017, plaintiff filed its response to defendants’ evidentiary objections,
Dkt. 37.
Having carefully considered the parties’ arguments, the Court finds and concludes
as follows.
II.

BACKGROUND
Plaintiff alleges the following facts.

Plaintiff designs and creates jewelry which is sold by national retailers. FAC ¶ 11.
Between 2011 and 2013 plaintiff created three original pendants, registered each pendant
with the United States Copyright Office, and received a copyright registration for each
one. Id. ¶¶ 15, 24, 35. Plaintiff also created one derivative pendant (collectively
“pendants”). Id. ¶ 26. At all times plaintiff has been and still is the sole proprietor of all
rights, titles, and interests in the copyrights of the pendants. Id. ¶¶ 18, 27, 36. The
pendants have been manufactured and /or distributed by plaintiff, or under its authority.
E.g., id. ¶¶ 18. Plaintiff has never authorized defendants to copy, reproduce,
manufacture, duplicate, or distribute any of the pendants. Id. ¶¶ 19, 29, 38.

2

Unless otherwise noted, the facts the Court relies on are uncontroverted. To the
extent that a party objects to the evidence cited, the objection is overruled. The Court
does not reach objections to evidence it does not rely on.

3

Plaintiff requests that the Court take judicial notice of Hand & Nail Harmony,
Inc. et al v. International Nail Co. et al, CV 15-2718 SJO (AJWx) (C.D. Cal. May 6,
2015). Dkt. 33, Ex. 1. The Court need not judicially notice an opinion in order to rely on
its holding. However, in this case the Court finds that Hand & Nail Harmony to be
distinguishable for the reasons discussed below.

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

Plaintiff alleges upon information and belief that defendants have infringed
plaintiff’s copyrights by marketing, manufacturing, distributing, duplicating, and/or
selling unauthorized copies of plaintiff’s pendants across the country, state, and district.
Id. ¶¶ 2–3, 20, 30, 39. Defendants’ infringing products were substantially or strikingly
similar to the pendants and were sold on websites operated by defendants including
ashleyjewels.com, boardwalkbuy.com, florencescoveljewelry.com, efamilymart.com,
ramadeals.com, 99santa.com, menpura.com, zulily.com, as well as other websites like
Groupon, and Facebook, all without plaintiff’s consent. Id. ¶¶ 6, 21, 31, 40. The FAC
also provides side by side comparison pictures between the pendants and defendants’
allegedly infringing products. Id. ¶ 42.
III.

LEGAL STANDARDS
A. Lack of Personal Jurisdiction

When a defendant moves to dismiss for lack of personal jurisdiction under Federal
Rule of Civil Procedure 12(b)(2), the plaintiff bears the burden of demonstrating that the
court may properly exercise personal jurisdiction over the defendant. Pebble Beach Co.
v. Caddy, 453 F.3d 1151, 1154 (9th Cir. 2006). Where, as here, a court decides such a
motion without an evidentiary hearing, the plaintiff need only make a prima facie
showing of jurisdictional facts to withstand the motion to dismiss. Ballard v. Savage, 65
F.3d 1495, 1498 (9th Cir. 1995); Doe v. Unocal Corp., 27 F. Supp. 2d 1174, 1181 (C.D.
Cal. 1998), aff’d, 248 F.3d 915 (9th Cir. 2001). The plaintiff’s alleged version of the
facts is taken as true for purposes of the motion if not directly controverted. AT & T v.
Compagnie Bruxelles Lambert, 94 F.3d 586, 588 (9th Cir. 1996); Unocal, 27 F. Supp. 2d
at 1181. If the defendant adduces evidence controverting the allegations, however, the
plaintiff may not rely on his pleadings, but must “come forward with facts, by affidavit or
otherwise, supporting personal jurisdiction.” Scott v. Breeland, 792 F.2d 925, 927 (9th
Cir. 1986) (quotation marks omitted). Any “conflicts between the facts contained in the
parties’ affidavits must be resolved in [plaintiff’s] favor for purposes of deciding whether
a prima facie case for personal jurisdiction exists.” AT & T, 94 F.3d at 588–89
(quotation marks omitted).
Generally, personal jurisdiction exists if (1) it is permitted by the forum state’s
long-arm statute and (2) the “exercise of that jurisdiction does not violate federal due
process.” Pebble Beach, 453 F.3d at 1154–55.

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

California’s long-arm jurisdictional statute is coextensive with federal due process
requirements, so that the jurisdictional analysis under state law and federal due process
are the same. Cal. Civ. Proc. Code § 410.10; Roth v. Garcia Marquez, 942 F.2d 617, 620
(9th Cir. 1991). In order for a court to exercise personal jurisdiction over a nonresident
defendant, that defendant must have “minimum contacts” with the forum state so that the
exercise of jurisdiction “does not offend traditional notions of fair play and substantial
justice.” Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945). Depending on the
nature of the contacts between the defendant and the forum state, personal jurisdiction is
characterized as either general or specific.
1. Specific Jurisdiction
A court may assert specific jurisdiction over a claim for relief that arises out of a
defendant’s forum-related activities. Rano v. Sipa Press, Inc., 987 F.2d 580, 588 (9th Cir.
1993). The test for specific personal jurisdiction has three parts:
(1) The defendant must perform an act or consummate a transaction within
the forum, purposefully availing himself of the privilege of conducting
activities in the forum and invoking the benefits and protections of its laws;
(2) The claim must arise out of or result from the defendant’s forum-related
activities; and
(3) Exercise of jurisdiction must be reasonable.
Id.; see also Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475–76 (1985). The
plaintiff bears the burden of satisfying the first two prongs, and if either is not satisfied,
personal jurisdiction is not established. Schwarzenegger v. Fred Martin Motor Co., 374
F.3d 797, 802 (9th Cir. 2004).
The Ninth Circuit generally uses a purposeful direction analysis (as opposed to
purposeful availment) when an action sounds in tort; this includes copyright infringement
actions. Brayton Purcell LLP v. Recordon & Recordon, 606 F.3d 1124, 1128 (9th Cir.
2010). Purposeful direction is analyzed under the “effects test.” Calder v. Jones, 465
U.S. 783, 787–89, (1984); Dole Food Co. v. Watts, 303 F.3d 1104, 1111 (9th Cir. 2002).
Under the “effects” test, “the defendant must have allegedly: (1) committed an intentional

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

act; (2) expressly aimed at the forum state; (3) causing harm that the defendant knows is
likely to be suffered in the forum state.” Yahoo! Inc. v. La Ligue Contre Le Racisme Et
L’Antisemitisme, 433 F.3d 1199, 1206 (9th Cir. 2006) (en banc) (per curiam) (quoting
Schwarzenegger, 374 F.3d at 803). A foreign act with foreseeable effects in the forum
state does not always give rise to specific jurisdiction; there must be “something more.”
Bancroft & Masters, Inc. v. Augusta Nat’l Inc., 223 F.3d 1082, 1087 (9th Cir. 2000).
“‘[S]omething more’ is what the Supreme Court described as ‘express aiming’ at the
forum state.” Id.
If the plaintiff establishes the first two prongs regarding purposeful direction and
the defendant’s forum-related activities, then it is the defendant’s burden to “present a
compelling case” that the third prong, reasonableness, has not been satisfied.
Schwarzenegger, 374 F.3d at 802 (quoting Burger King, 471 U.S. at 477). The third
prong requires the Court to balance seven factors: (1) the extent of the defendant’s
purposeful availment, (2) the burden on the defendant, (3) conflicts of law between the
forum state and the defendant’s state, (4) the forum’s interest in adjudicating the dispute,
(5) judicial efficiency, (6) the plaintiff’s interest in convenient and effective relief, and
(7) the existence of an alternative forum. Roth, 942 F.2d at 623.
B. Improper Venue
If an action is filed in the “wrong division or district” a court may dismiss the
action or, “if it be in the interest of justice” transfer the action to an appropriate district or
division. 28 U.S.C. § 1406(a). In federal courts, the determination of where venue is
appropriate “is governed entirely by statute.” Zumba Fitness, LLC v. Brage, 2011 WL
4732812 (C.D. Cal. Oct. 6, 2011) (citing Leroy v. Great W. United Corp., 443 U.S. 173,
181 (1979)). When deciding a motion to dismiss for improper venue, unlike a Rule
12(b)(6) motion, the court need not accept the pleadings as true and may consider facts
outside the pleadings. See R.A. Argueta v. Banco Mexicano, S.A., 87 F.3d 320, 324 (9th
Cir. 1996). Once a defendant raises an objection to venue, the plaintiff bears the burden
of establishing that the selected venue is proper. Rio Properties, Inc. v. Rio Intern.
Interlink, 284 F.3d 1007, 1019 (9th Cir. 2002). To defeat a motion to dismiss for
improper venue, the plaintiff needs only to make a prima facie showing of proper venue.
IV.

DISCUSSION

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

Defendants argue that the Court lacks personal jurisdiction over them, and that the
FAC should be dismissed because venue in this district is improper. The Court finds that
it cannot exercise jurisdiction over defendants based on their contacts with California, but
that it can exercise jurisdiction over defendants based on their contacts with the United
States as a whole. Because this Court has personal jurisdiction over defendants, venue is
also proper under the Copyright Act. 28 U.S.C. § 1400(a). For the reasons set forth
herein, the Court denies defendants’ motion to dismiss.
A.

Defendants’ Motion to Dismiss for Lack of Personal Jurisdiction

Plaintiff appears to concede there is no general jurisdiction over defendants. The
Court therefore analyzes only whether it can exercise specific jurisdiction over
defendants.
1.

Specific Jurisdiction in California

In Washington Shoe Co. v. A-Z Sporting Goods, Inc., the Ninth Circuit reaffirmed
its rule that personal jurisdiction in a copyright case could be justified under a theory of
“individualized targeting.” 704 F.3d 668, 676–679 (9th Cir. 2012) (abrogation
recognized by Axiom Foods, Inc. v. Acerchem Int’l, Inc., 874 F.3d 1064, 1067
(“Axiom”) (9th Cir. 2017)). The premise of the theory is that the loss or harm of
copyright infringement is felt by the owner of the copyright in both the location where
the infringement takes place, and wherever the owner exercises control over the
copyright, which for a corporation is usually its principal place of business. Id. (citing
Laws v. Sony Music Entm’t, Inc., 448 F.3d 1134, 1137 (9th Cir.2006)). A loss occurs in
the location where the owner exercises control of the copyright because the infringing act
deprives the owner of the exclusive right to control the work. Id. Thus, if a defendant
knew that a copyright existed, knew the forum of the copyright holder, and was alleged to
have willfully infringed that copyright, then under a theory of individualized targeting the
defendant knowingly harmed the plaintiff in the forum state. Id. at 678–79. Under this
theory the Ninth Circuit found that Washington could exercise personal jurisdiction over
an Arkansas retailer that sold copyright infringing shoes only in Arkansas, because the
retailer continued to do so after receiving cease and desist letters from the copyright
holder who it knew was headquartered in Washington. Id. at 679.
However, in Axiom the Ninth Circuit acknowledged that Washington Shoe had
been abrogated by the Supreme Court’s opinion in Walden v. Fiore, 134 S. Ct. 1115

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

(2014). Axiom, 874 F.3d at 1070. The Ninth Circuit explained that Walden had rejected
the Ninth Circuit’s theory of individualized targeting because, without more, it
“impermissibly allowed a plaintiff’s contacts with the defendant and forum to drive the
jurisdictional analysis.” Id. (quoting Walden, 134 S.Ct. at 1125). Walden “made clear
that we must look to the defendant’s ‘own contacts’ with the forum, not to the
defendant’s knowledge of a plaintiff’s connections to the forum.” Id. (quoting Walden,
134 S.Ct. at 1124–25). Individualized targeting may still remain relevant to the minimum
contacts inquiry, but “it will not, on its own, support the exercise of specific jurisdiction,
absent compliance with what Walden requires.” Id.
In Axiom a UK company sent a newsletter promoting rice protein products to 343
email addresses that contained the copyrighted logo of a California company that sells
organic and chemical-free products made from, among other things, whole-grain brown
rice. Id. at 1066-67. Plaintiff’s counsel provided evidence that the 343 recipients of the
email included at least 55 recipients with companies in California, including 14 with
locations in Los Angeles County. Id. at 1070. However, the Ninth Circuit found this was
insufficient to support finding personal jurisdiction after Walden because the analysis
must “focus on the defendant’s contacts with the forum State itself, not the defendant’s
contacts with persons who reside there.” Id. (quoting Walden, 134 S.Ct. at 1122).
Without evidence concerning the residence of the 55 recipients and the relationship each
of them has to their company such evidence was “too attenuated and isolated” to support
the exercise of jurisdiction. Id. (citations and quotations omitted). In addition, the Ninth
Circuit held that California was hardly the focal point of the newsletter or the harm
suffered because only 10 of the recipients were physically located in California, most of
its recipients were in Western Europe, and the defendant did not conduct business in
California. Id. at 1070-71.
(a)

Purposeful Direction

The only element of purposeful direction the parties dispute is whether defendants
expressly aimed their conduct at California. Defendants argue that they did not
purposefully direct any activities towards California because they are not present in
California, never targeted California customers, and operate entirely out of Canada.
MTD at 12-14. Plaintiff argues that this element is satisfied because defendants have
substantial marketing and sales in California, and regardless, willful infringement is
sufficient. Opp’n at 11–13.

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

Plaintiff argues that “a defendant’s intentional acts are expressly aimed at
California when the defendant intentionally violates the copyrights held by a California
corporation.” Opp’n at 11. Plaintiff misstates the individualized targeting theory, and
Axiom recognized that this theory alone is not sufficient to establish express aiming
towards California. The only allegedly infringing action plaintiff identifies that occurred
after defendants were on notice of the existence of the copyright and plaintiff’s location
of California is an attempted purchase by plaintiff’s law firm that was made after the
MTD was filed. Anwandter Decl. ¶ 18, Ex. N. A purchase made by plaintiff’s counsel
after litigation has commenced cannot be used to support a finding of personal
jurisdiction. See L.A. Gem. v. Ecommerce, 2017 WL 1535084, at *9 (citing Farmers
Ins. Exch. v. Portage La Prairie Mut. Ins. Co., 907 F.2d 911, 913 (9th Cir. 1990) (“Only
contacts occurring prior to the event causing the litigation may be considered [for
establishing purposeful availment].”)). Even if such a purchase could demonstrate
purposeful direction, after learning of the purchase from the Opposition the defendants
cancelled the order and refunded the money. Nirav Suppl. Decl. ¶¶ 20–22. For these
reasons, even if individualized targeting is still relevant to the minimum contacts
analysis, plaintiff has not shown that willful infringement occurred.
Plaintiff’s arguments for substantial marketing and sales are drawn from
defendants’ (1) use of Facebook’s ability to target California as a market, (2) advertising
and selling infringing products to customers in California, and (3) selling infringing
products through their own websites and storefronts on websites like Facebook and
Groupon. Opp’n at 12–13. Defendants do not dispute that they advertised the infringing
products on Facebook, but do provide declarations stating that they have never targeted
California. Nirav Decl. ¶ 17. In response however plaintiff fails to produce any evidence
suggesting that defendants have targeted California with Facebook advertisements for the
infringing products. Defendants also admit that they have sold some infringing products
to California, although defendants estimate that California made up less than 1% of
infringing sales. Id. ¶ 18. However, this 1% figure is suspect because defendants admit
that it is not based on an actual review of sales records because defendants do not have
sophisticated sales records and would instead have to examine them by hand. Id.
Regardless of the percentage, the only evidence of actual sales of allegedly infringing
products to California residents prior to the filing of the complaint are two purchases by
plaintiff’s law firm, Anwandter Decl. ¶¶ 10, 11, and eight sales defendants admit they

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

were made through Groupon.4 However, plaintiff has admitted to making at least 2400
infringing sales. Anwandter Decl., Ex. L at 88. Even if the Court includes the sales to
plaintiff’s law firm, that is still only ten sales out of 2400. Like the ten California
residents who received the newsletter in Axiom, ten sales are simply too attenuated and
isolated to suggest that California was the focal point of the sales and the harm suffered.
Axiom, 874 F.3d at 1070. Finally, the evidence shows that defendants used Facebook
and Groupon only to advertise their products, but that all sales took place through their
websites. Nirav Decl.¶ 16; Nirav Suppl Decl. ¶ 19. Plaintiff has provided no evidence to
suggest that a consumer could actually purchase the infringing goods from Facebook or
Groupon.
Because there is no evidence that defendants targeted their advertising or made
anything more than attenuated or isolated sales to California, defendants did not
expressly target their activities towards California. Defendants therefore did not
purposefully direct their activities towards California.
(b)

Arising out of Defendant’s Forum Related Conduct

A lawsuit arises out of a defendant’s contacts with the forum state if there is a
direct nexus between the cause of action being asserted and the defendant’s activities in
the forum. See Shute v. Carnival Cruise Lines, 897 F.2d 377, 385 (9th Cir.1990), rev’d
on other grounds, 499 U.S. 585 (1991). The Ninth Circuit has adopted a “but for” test
when assessing whether an action arises out of a defendant’s contacts with the forum
state. See, e.g., Panavision, Intern., L.P. v. Toeppen, 141 F.3d 1316, 1322 (9th Cir.1998)
(“We must determine if the plaintiff Panavision would not have been injured ‘but for’ the
defendant Toeppen’s conduct directed toward Panavision in California”).
Plaintiff argues that its claims for copyright infringement all arise from defendants’
advertising contracts with the social media websites, Facebook in particular. Opp’n at

4

At oral argument counsel for defendants said that there was no evidence that sales
had occurred through Groupon. The Court notes that defendant Nirav admitted in his
supplemental declaration that defendants sold infringing products to customers in
California through Groupon. Nirav Suppl. Decl. ¶ 19 (“An & Associates sold
approximately 40 total units of the jewelry designs at issue through Groupon, only 8 of
which were shipped to California.”).

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UNITED STATES DISTRICT COURT
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Case No. 
Title 

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CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

14. Even assuming that defendants’ Facebook advertising was targeted towards
California, many customers would have purchased infringing products by going to
defendants’ websites directly, or through some means other than Facebook. Plaintiff has
not explained how their purchases arise from defendants’ forum-related activity if they
did not come through Facebook advertisements. But for defendants’ Facebook
advertising defendants may have sold fewer infringing products, but they certainly would
have sold some infringing products. Plaintiff’s claims therefore do not arise from
defendants’ Facebook advertising.
Finally, plaintiff could try to find specific jurisdiction in a California court based
on defendants’ direct sale and shipment of allegedly infringing products to customers in
California. However, plaintiff has not provided an explanation for how a California court
could exercise jurisdiction based on sales made to customers in other states. If the
Canadian defendants sell and ship an infringing product to New York for example, that
infringement has no contact with California. Plaintiff’s claims therefore do not arise
from defendants’ sale and shipment of infringing products to California.
Because both theories miss a potentially substantial number of infringing sales,
neither is a but for cause of plaintiff’s claims. Plaintiff’s claims therefore do not arise out
of defendants’ activities in California.
Plaintiff has failed to meet its burden on both the purposeful direction and arising
under prongs of the test for specific jurisdiction test. Therefore, this Court cannot
exercise personal jurisdiction over plaintiff’s claims on the basis of defendants’ contacts
with California.
2.

Jurisdiction Under Rule 4(k)(2)

Plaintiff argues in the alternative that if defendants are not subject to personal
jurisdiction in California then they are subject to nationwide jurisdiction under Federal
Rule of Civil Procedure 4(k)(2). Rule 4(k)(2) permits a federal court to exercise personal
jurisdiction over a defendant if three requirements are met:
First, the claim against the defendant must arise under federal law.
Second, the defendant must not be subject to the personal jurisdiction of
any state court of general jurisdiction. Third, the federal court’s exercise
of personal jurisdiction must comport with due process.

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

Pebble Beach Co., 453 F.3d at 1159 (citations omitted). “The due process analysis under
Rule 4(k)(2) is nearly identical to traditional personal jurisdiction analysis with one
significant difference: rather than considering contacts between [the defendant] and the
forum state, we consider contacts with the nation as a whole.” Holland Am. Line Inc. v.
Wartsila N. Am., Inc., 485 F.3d 450, 462 (9th Cir. 2007).
It is undisputed that plaintiff’s claims arise under federal law. The Court has
explained why defendants are not subject to personal jurisdiction in California. In the
Ninth Circuit a defendant bears the burden of identifying another state where they are
subject to personal jurisdiction, and defendants have failed to identify any such state. Id.
(“absent any statement from either Wärtsilä or Wärtsilä Finland that it is subject to the
courts of general jurisdiction in another state, the second requirement of Rule 4(k)(2) is
met.”). The only element of Rule 4(k)(2) in dispute is therefore whether this Court’s
exercise of personal jurisdiction over defendants would comport with Fifth Amendment’s
due process clause. Getz v. Boeing Co., 654 F.3d 852, 859 (9th Cir. 2011) (citing Fed. R.
Civ. P. 4(k)(2) advisory committee’s notes to 1993 amendment) (noting that Rule 4(k)(2)
is governed by the due process clause of the Fifth Amendment rather than the Fourteenth
Amendment). The Court therefore applies the test for specific jurisdiction described
above to defendants using the United States as the relevant forum.
(a)

Purposeful Direction

The only element of the purposeful direction test the parties dispute is whether
defendants expressly aimed their activities towards the United States. Reply at 14-15. In
Axiom, the defendant’s only contact with the United States was a single newsletter
emailed to 80 recipients with companies in the United States (10 in California, 70 outside
of California), but plaintiffs failed to explain the relationship between the recipients, their
companies, the newsletter, and the United States. See Axiom, 874 F.3d at 1072. The
Ninth Circuit held that it would violate due process to exercise personal jurisdiction
under Rule 4(k)(2) because the defendant’s contact with the United States was “[a]t best .
. . scant, fleeting, and attenuated.” Axiom, 874 F.3d at 1072 (quoting Holland Am. Line, 
485 F.3d at 562). Here, the Canadian defendants target the United States with their
advertising, employ fully interactive websites selling the infringing products that cater to
customers in the United States, and ship the infringing products to the United States. On
this record the Court easily finds that defendants targeted the United States.

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O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

Defendants have fully interactive websites that are expressly aimed at customers in
the United States. Anwandter Decl. Exs. G, H, N. On three occasions plaintiff’s law
firm had an employee order an infringing pendant from defendants’ websites.5
Anwandter Decl. ¶¶ 10, 11, 18. The webpage for the last pendant purchased states that
the “deal” price (in U.S. dollars) is valid for U.S. and Canadian residents only, the
pendant ships within 5-7 business days, cannot be delivered to Alaska or Hawaii, and
shipping information must be provided at checkout and cannot be changed. Anwandter
Decl. Ex. N, at 95. Although plaintiff did not provide defendants’ webpage where the
product is actually ordered, plaintiff did provide the order confirmation page. This page
shows the customer’s United States billing and shipping addresses, United States phone
number (including Los Angeles area code), amount paid in U.S. dollars for both the
product and shipping, and displays the customer’s shipping address on Google Maps. Id.
at 97. Each of these pieces of information on a Canadian website supports finding that
defendants expressly aimed their activities towards the United States.
Defendants also targeted the United States through its nationwide advertising of
the infringing products. Defendants admit they ran a global advertising campaign
through Facebook’s Canadian division, but state that they “did not specifically target
California residents, or residents of any other location.” Amar Decl. ¶ 17; Nirav Decl. ¶
17. This however is contradicted by a video made by Facebook Canada. In the video,
defendant Nirav begins by stating how last year defendants had $35 million in revenue,
this year they were expecting to surpass $100 million in revenue, and 80% of their traffic
and a majority of their conversions (first-time purchases by people browsing one of their
sites) come from Facebook. Graham Decl., Ex. 1. He then explains that “[o]ur biggest
challenge was to find a way to scale globally, we knew there was a significant
opportunity in various different countries across the world. We just needed to find out a

5

Defendants state that they removed all such jewelry from their websites upon
receiving the FAC, Nirav Decl. ¶ 21, and that the allegedly infringing products were only
sold on two of their websites, Anwandter Decl., Ex. L at 89. Plaintiff’s firm then
provided evidence that infringing product(s) were still for available for purchase from a
third website of defendants even after defendants filed this MTD. Anwandter Decl. ¶ 18.
While the Court does not use this attempted purchase to support its finding of personal
jurisdiction, it does use screenshots of the transaction as evidence that defendants’
websites are interactive and expressly aimed towards the United States.

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

strategy and a plan to reach those countries.” Id. Towards the end of the video he also
says “[t]he Facebook global targeting feature allowed us to scale like no other platform
has.” Id. Defendant Nirav confirmed in his supplemental declaration that he was
referring to using Facebook’s worldwide targeting feature to target entire countries.
Nirav Suppl. Decl. ¶¶ 8-9. Confusingly, in the same declaration he confirms his earlier
statement that defendants “did not specifically target California residents, or residents of
any other location, through this advertising campaign.” Id. ¶¶ 11, 16. Resolving factual
disputes in plaintiff’s favor, even disregarding the rest of the video and its animations,
defendant Nirav’s own words are sufficient to conclude that defendants targeted their
Facebook advertising towards foreign countries, and the only plausible conclusion is that
they targeted the United States. This is further supported by traffic statistics compiled by
alexa.com, an Internet tracking service, which show that 85% of Boardwalkbuy.com’s
web traffic, and 54.2% of Florencescoveljewelry.com’s web traffic comes from the
United States.6 Anwandter Decl. Ex. Q.
Defendants also shipped the allegedly infringing products directly to customers in
the United States. The FAC alleges on information and belief that defendants have
engaged in the nationwide sale and distribution of infringing products. E.g., FAC ¶¶ 13,
20. Defendants admit that all of their merchandise is shipped from Canada, and there is
no evidence of a domestic distributor or other intermediary besides the company that
actually transports the products. Amar Decl ¶ 10; Anwandter Decl. Exs. G, H, N. At this
stage the Court must therefore conclude that defendants directly ship their products to
customers in the United States. This is therefore not a case involving a “stream of
commerce” theory of personal jurisdiction. E.g., Goodyear Dunlop Tires Operations,
S.A. v. Brown, 564 U.S. 915, 926 (U.S. 2011) (noting that the stream of commerce
theory has been used to find specific jurisdiction in products liability cases involving an
extensive chain of distribution between the consumer and the defendant manufacturer).
Defendants did not manufacture the products in this case, and are instead the distributor
that sold and shipped them directly to the customer. There is thus no question of whether
it was foreseeable that defendants’ products would end up in the United States, it was an

6

Defendants object that the reports on their web traffic from alexa.com are
hearsay. The Court finds that they fall within the exception for market reports. Fed. R.
Evid. 803(17). Even if the Court were to conclude that the evidence were inadmissible,
that would not change its conclusion under Rule 4(k)(2).

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Page 13 of 16 

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

absolute certainty because defendants were the ones who shipped them. J. McIntyre
Mach., Ltd. v. Nicastro, 564 U.S. 873, 883 (2011) (plurality opinion) (“it is the
defendant’s actions, not his expectations, that empower a State’s courts to subject him to
judgment.”).
Because defendants’ websites cater to people in the United States, they admit to
targeting the United States with their advertising, and because they physically shipped all
of the allegedly infringing products to the United States, the Court finds that defendants
expressly aimed their activities towards the United States.
At oral argument counsel for defendants argued that even if there is sufficient
evidence to find that defendant An & Associates purposefully directed its activities
towards the United States, there was no evidence that defendants Amar and Nirav
directed any activities towards the United States in their individual capacities. This
misstates defendants’ burden. On a motion to dismiss for lack of personal jurisdiction the
“uncontroverted allegations in the complaint must be taken as true.” Schwarzenegger,
374 F.3d at 800. Moreover, the Supreme Court has rejected “the suggestion that
employees who act in their official capacity are somehow shielded from suit in their
individual capacity.” Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 781 n.13 (1984).
The FAC alleges that defendants Amar and Nirav are each a “principal, guiding spirit,
and/or central figure in in defendant AN [sic] & Associates and has control over the day
to day operations thereof . . . .” FAC ¶¶ 7, 8. Having found that defendant An &
Associates purposefully directed its activities towards the United States, this allegation is
sufficient to establish plaintiff’s prima facie showing of jurisdiction over defendants
Amar and Nirav. Because defendants do not cite to any evidence that disputes these
allegations, the Court must accept them as true. Therefore, the Court can properly
exercise jurisdiction over defendants Amar and Nirav in their individual capacities.
(b)

Arising out of Defendant’s Forum Related Conduct

Plaintiff’s claims necessarily arise out of the exact same products it alleges
defendants sold, advertised, and shipped to consumers in the United States. It is clear
that plaintiff’s claims arise out of defendants’ conduct related to the United States.
(c)

Reasonableness

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Page 14 of 16 

UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

Defendants must present a compelling case that the balance of the seven factors
show that it would be unreasonable for this court to exercise personal jurisdiction.
Schwarzenegger, 374 F.3d at 802 (quotations omitted). The only facts that weigh in
defendants’ favor are that they and much of the evidence are all in Canada. However,
Nirav, An & Associates’ custodian of records, states that defendants do not have
sophisticated sales records, and he will have to review them one by one in order to
provide the relevant information for defendants’ sales. Nirav Decl. ¶¶ 3, 18. This is
implausible for a company that expects to have $100 million in revenue this year, but it
does suggest that any burdens from litigating in a foreign jurisdiction related to the
evidence will be dwarfed by problems of defendants’ own recordkeeping. In addition,
the mere fact that defendants are foreign without more is not enough to show that
exercising personal jurisdiction would be unreasonable, otherwise it would always
prevent a suit against a foreign national in a United States court. Roth, 942 F.2d at 623–
24 (quotations omitted). This is particularly true for Rule 4(k)(2), which only applies to
foreign defendants because domestic defendants will always be subject to at least one
state’s general jurisdiction.
Similarly, Rule 4(k)(2) only exists because the United States has an important
interest in ensuring that federal laws are enforced in federal court against foreign
defendants who might otherwise evade state long arm statutes. Fed. R. Civ. P. 4(k)
advisory committee’s notes to 1993 amendment (citing Omni Capital Int’l v. Rudolf
Wolff & Co., Ltd., 484 U.S. 97, 111 (1987) (suggesting that Congress or “those who
propose the Federal Rules of Civil Procedure” should create almost verbatim what
became Rule 4(k)(2)).
For the foregoing reasons defendants have failed to present a compelling reason for
why the exercise of jurisdiction would be unreasonable.
B.

Defendants’ Motion to Dismiss Due to Improper Venue

In most actions, venue is governed by the general venue statute, 28 U.S.C. § 1391.
However, claims for copyright infringement are unique in that, in such claims, venue is
governed by the special venue provisions of the Copyright Act. See Goldberg v.
Cameron, 482 F. Supp. 2d 1136, 1143 (N.D. Cal. Feb. 27, 2007) (“The venue of suits for
infringement of copyright is not determined by the general provision governing suits in
the federal district courts, rather by the venue provision of the Copyright Act, [28 U.S.C.

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UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF CALIFORNIA

Case No. 
Title 

O

CIVIL MINUTES - GENERAL
CV17-2417-CAS(JEMx)
Date December 6, 2017
L.A. GEM & JEWELRY DESIGN, INC. v. AN & ASSOCIATES CO. INC.
ET AL.

§ 1400(a)].”); Zumba Fitness, 2011 WL 4732812, at *1 (“All claims—with the exception
of the copyright claim—are governed by the general venue statute, 28 U.S.C. § 1391”)
(emphasis added). The venue provision of the Copyright Act, 28 U.S.C. § 1400(a),
provides, in pertinent part: “Civil actions, suits, or proceedings arising under any Act of
Congress relating to copyrights . . . may be instituted in the district in which the
defendant or his agent resides or may be found.” The Ninth Circuit “interprets this
provision to allow venue in any judicial district where, if treated as a separate state, the
defendant would be subject to personal jurisdiction.” Brayton Purcell LLP v. Recordon
& Recordon, 606 F.3d 1124, 1126 (9th Cir. 2010). In other words, the analysis of venue
under the Copyright Act is, in large part, coterminous with the analysis on a motion to
dismiss for lack of personal jurisdiction. Because the Court has found that it can exercise
personal jurisdiction over defendants, all defendants can be found in this district, and
venue in this district is therefore proper under 28 U.S.C. § 1400(a).
V.

CONCLUSION

In accordance with the foregoing, the Court DENIES defendants’ motion to
dismiss.
IT IS SO ORDERED.
Initials of Preparer

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