Wine Group LLC v. Levitation Management LLC et al
Filing
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ORDER denying 9 Motion to Dismiss for Lack of Jurisdiction signed by Judge William B. Shubb on 10/5/11. (Matson, R)
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UNITED STATES DISTRICT COURT
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EASTERN DISTRICT OF CALIFORNIA
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----oo0oo----
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NO. CIV. 2:11-1704 WBS JFM
THE WINE GROUP LLC, a Delaware
limited liability company,
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MEMORANDUM AND ORDER RE:
MOTION TO DISMISS OR TO
TRANSFER
Plaintiff,
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v.
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LEVITATION MANAGEMENT, LLC, a
Nevada limited liability
company; and TIPTON SPIRITS,
LLC, d/b/a Desirée Vodka
Company, LLC, an Indiana
limited liability company,
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Defendants.
/
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----oo0oo----
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Plaintiff The Wine Group LLC (“TWG”) brought this
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trademark infringement action against defendants Levitation
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Management, LLC (“Levitation”),1 and Tipton Spirits, LLC, d/b/a
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Desirée Vodka Company, LLC (“Tipton”).
Defendants move to
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According to defendants, the name of this company is
Levitation Marketing, LLC, not Levitation Management, LLC, as
captioned in the Complaint.
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dismiss for lack of personal jurisdiction pursuant to Federal
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Rule of Civil Procedure 12(b)(2) or, alternatively, to transfer
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to the Southern District of Indiana for improper venue pursuant
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to 28 U.S.C. § 1406(a).
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I.
Factual and Procedural Background
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Plaintiff, a Delaware limited liability company with
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its principal place of business in Tracy, California, produces,
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imports, and markets wine, vodka, and other alcoholic beverages.
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(Compl. ¶¶ 3, 7.)
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Its products are advertised, distributed, and
sold throughout the United States.
(Id. ¶ 7.)
In 2007, plaintiff launched a brand of wine called
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“Cupcake.”
(Id. ¶ 8.)
Plaintiff has registered “Cupcake” as a
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trademark.
(Id. ¶ 15.)
In 2010, plaintiff created a sub-brand
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of Cupcake wine called “Red Velvet.”
(Id. ¶ 12.)
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After allegedly great nationwide success with the
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Cupcake wine, plaintiff decided to create a Cupcake brand of
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vodka in 2010 and launched the Cupcake vodka in April of 2011.
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(Id. ¶ 16.)
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for spirits.
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Plaintiff has registered “Cupcake” as a trademark
(Id. ¶ 18.)
According to plaintiff, California is the largest
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market for vodka in the United States and plaintiff sells more
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Cupcake wine, Cupcake Red Velvet wine, and Cupcake vodka in
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California than any other state.
(Lizar Decl. ¶¶ 3-7.)
In early 2010, defendants created a “Desirée” brand of
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vodka.
(Compl. ¶ 19.)
Levitation is a Nevada limited liability
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company, (id.), with its principal place of business in Brazil,
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Indiana.
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agency that owns the DESIRÉE trademark, the other trademarks at
(Knight Decl. I ¶ 5.)
“It is a marketing consulting
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issue [], and the domain name desireevodka.com.”
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Tipton, an Indiana limited liability company, “is responsible for
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the sales and marketing of the [Desirée vodka.]”
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Tipton’s principal place of business is in Brazil, Indiana.
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(Knight Decl. I ¶ 8.)
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(Compl. ¶ 4.)
(Id. ¶ 5.)
Plaintiff takes issue with two of defendants’ sub-
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brands of Desirée vodka: “On one vodka, Defendants use the
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trademark CUPCAKE and a large depiction of a cupcake, and on the
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other Defendants use the trademark RED VELVET and a large
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depiction of a slice of a layer cake.”
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(Compl. ¶ 20.)
In February of 2011, before defendants had launched
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their vodka, plaintiff informed defendants by letter of its
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trademark registration and pending application and asked
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defendants to change their labels.
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plaintiff is located in California.
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series of communications in which defendants disputed that their
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use of “Cupcake” or “Red Velvet” was improper.
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defendants launched their vodka and did not change their labels.
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(See Reidl Decl. ¶¶ 2-7; Compl. ¶¶ 23-27.)
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Defendants were informed that
The parties exchanged a
In April of 2011,
The Complaint alleges the “[a]cts giving rise to the
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claims asserted herein have been expressly aimed at, have
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occurred in, and will continue to occur in California and this
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District,”
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are the place of injury.
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(Compl. ¶ 2), and that California and this district
(Id. ¶ 3.)
Plaintiff has not alleged that defendants sell their
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vodka in California.
According to defendants, they currently
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sell their vodka in seven states.
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Defendants’ vodka cannot be purchased through their website.
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(Knight Decl. I ¶ 15.)
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(Id. ¶ 28, Ex. 1.)
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Plaintiff alleges that defendants “are in the process
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of rolling out CUPCAKE and RED VELVET vodka and seeking
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distributors on a national basis, including in California.
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Defendants’ DESIRÉE vodka competes directly with TWG’s CUPCAKE
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vodka.”
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The
(Compl. ¶ 21.)
Defendants admit to engaging in one unsuccessful
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discussion with a California-based distributor, which resides in
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this district, that touched on defendants’ vodka.
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Decl. I ¶¶ 21-22.)
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products will be “Coming soon” to every state.
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(See Knight
Defendants’ website states that their
(Id. Ex. 1.)
In support of their allegation that defendants market
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and promote their vodka in California, (see Compl. ¶ 21),
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plaintiff relies heavily on defendants’ Internet activity.
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Defendants maintain a website, www.desireevodka.com, at which
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visitors are invited to contact defendants to receive additional
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information.
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“metatags” for “Cupcake Vodka” and “Red Velvet Vodka.”
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Decl. ¶ 8; Knight Decl. II ¶ 14.)
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metatags “ensure that references to Defendants’ vodka will appear
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whenever a consumer searches for TWG’s wine or vodka.”
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26.)
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search engine Google for “cupcake vodka” only yielded results
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related to plaintiff on the first two pages; the third page
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contained results related to defendants.
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Ex. A.)
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defendants on the website of Facebook, a California company, and
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provides a link to their Facebook page.
(Knight Decl. I Ex. 1.)
The website includes
(Lizar
Plaintiff alleges that the
(Compl. ¶
However, according to defendants, a recent search on the
(Knight Decl. II ¶ 14,
Defendants’ website invites visitors to “follow”
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(Knight Decl. I Ex. 1.)
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Defendants have created a Facebook page that allows
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defendants to post information about their products.
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Decl. I ¶ 29.)
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messages to defendants and defendants to respond to users
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messages.
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Facebook page to solicit applications for “Brand Ambassadors” it
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hires to promote defendants’ products.
The page also permits website users to post
(Knight Decl. I, Ex. 2.)
Defendants also use the
(Id.)
The parties dispute how Facebook functions and how
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(Knight
defendants have used it.
According to plaintiff, “each [Facebook
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“friend”] will receive all updates posted by the other person on
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their respective homes pages.”
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Plaintiff claims that the owner of a Facebook page must first
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“accept” a “friend request” and can “delete” a “friend.”
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14, 16-17.)
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determine where another “friend” resides.2
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(Lizar Decl. ¶ 14.)
(Id. ¶¶
Plaintiff contends that only a “friend” can
(Id. ¶ 15.)
Plaintiff’s counsel, a resident of this district,
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“friended” defendants and has since “automatically receive[d] all
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communications posted to the Facebook page by Defendants,”
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including an entry referring to “Cupcake Vodka” and “Red Velvet
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Vodka.”
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entries on defendants’ page by “friends” of defendants who
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indicate that they live in California.
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in Bakersfield, California, simply said that defendants’ vodka
(Reidl Decl. ¶¶ 12-13.)
Plaintiff’s counsel notes two
One entry from a “friend”
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According to defendants, defendants’ Facebook page only
allows a Facebook user to “like” or “follow” or become a “fan” of
defendants. In other words, defendants do not “accept” “friend
requests.” Defendants can only restrict Facebook “fans” by age
and country, and defendants can only view information on a user’s
profile that the user has made “public,” which may or may not
include where the user lives. (See Knight Decl. II ¶¶ 15-16.)
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was not available in California, to which defendants did not
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respond.
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available in California, to which defendants responded that a
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distributor had not been appointed “yet” and asked for
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suggestions.
Another entry asked defendants when the vodka would be
(See Reidl Decl. ¶¶ 18-19; Knight Decl. I Ex. 2.)
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According to defendants, as of August 2, 2011, five of
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the Facebook users who “like” defendants indicate that they live
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in California.
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search on Facebook’s search bar for “cupcake vodka” does not
Defendants have approximately 254 “fans.”
A
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result in any mention of defendants or their vodka.
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search only results in a page for plaintiff’s Cupcake vodka.
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(See Knight Decl. II ¶¶ 18-19, Ex. B.)
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Such a
Facebook allows advertising, including advertising
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based on geography.
(Id. ¶ 17.)
According to defendants, they
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have not purchased targeted advertising on Facebook “for any
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country or state, let alone California or the cities that reside
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in the Eastern District of California.”
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time ha[ve] [defendants] engaged in paid advertising . . .
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anywhere outside of the markets where the Desirée vodka products
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are sold.”
(Id.)
Further, “at no
(Id. ¶ 20.)
On June 24, 2011, plaintiff filed this action against
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defendants, asserting claims for trademark infringement under the
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Lanham Act, 15 U.S.C. §§ 1051-1127, and restitution based on
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unjust enrichment.
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II.
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Discussion
The plaintiff has the burden of establishing that the
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court has personal jurisdiction over a defendant.
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Corp., 248 F.3d 915, 922 (9th Cir. 2001).
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Doe v. Unocal
Where the court does
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not hold an evidentiary hearing and the motion is based on
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written materials, as here, plaintiff need only establish a prima
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facie showing of jurisdiction.
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Motor Co., 374 F.3d 797, 800 (9th Cir. 2004).
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has contradicted allegations contained in the complaint,
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plaintiff may not rest on the pleadings, but must present
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admissible evidence which, if true, would support the exercise of
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personal jurisdiction.
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Bell & Clements Ltd., 328 F.3d 1122, 1129 (9th Cir. 2003).
Schwarzenegger v. Fred Martin
Once a defendant
Harris Rutsky & Co. Ins. Servs., Inc. v.
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Uncontroverted allegations in the Complaint must be taken as true
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and conflicts between statements contained in affidavits must be
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resolved in the plaintiff’s favor.
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800.
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Schwarzenegger, 374 F.3d at
“Where there is no applicable federal statute governing
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personal jurisdiction, the district court applies the law of the
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state in which it sits.
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statute is coextensive with federal due process requirements.”
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Love v. Associated Newspapers, Ltd., 611 F.3d 601, 608-09 (9th
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Cir. 2010) (citing Yahoo! v. La Ligue Contre Le Racisme, 433 F.3d
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1199, 1205 (9th Cir. 2006) (en banc)); Cal. Code Civ. Proc. §
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410.10).
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nonresident defendant, that defendant must have at least ‘minimum
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contacts’ with the relevant forum such that the exercise of
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jurisdiction ‘does not offend traditional notions of fair play
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and substantial justice.’”
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(quoting Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)).
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Plaintiff relies only on specific jurisdiction.
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California’s long-arm jurisdictional
“For a court to exercise personal jurisdiction over a
Schwarzenegger, 374 F.3d at 801
The Ninth Circuit uses a three-prong test to determine
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whether specific jurisdiction exists:
(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;
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(2) the claim must be one which arises out of or relates
to the defendant’s forum-related activities; and
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(3) the exercise of jurisdiction must comport with fair
play and substantial justice, i.e. it must be reasonable.
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Id. at 802 (quoting Lake v. Lake, 817 F.2d 1416, 1421 (9th Cir.
1987)) (internal quotation marks omitted).
“The plaintiff bears the burden of satisfying the first
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two prongs of the test.
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of these prongs, personal jurisdiction is not established in the
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forum state.”
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prongs, “the burden then shifts to the defendant to ‘present a
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compelling case’ that the exercise of jurisdiction would not be
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reasonable.”
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U.S. 462, 476-78 (1985)).
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A.
Id.
If the plaintiff fails to satisfy either
Once the plaintiff satisfies the first two
Id. (quoting Burger King Corp. v. Rudzewicz, 471
Purposeful Direction
“The first prong is satisfied by either purposeful
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availment or purposeful direction . . . . ‘A purposeful availment
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analysis is most often used in suits sounding in contract.
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purposeful direction analysis, on the other hand, is most often
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used in suits sounding in tort.’”
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Recordon & Recordon, 606 F.3d 1124, 1128 (9th Cir. 2010) (quoting
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Schwarzenegger, 374 F.3d at 802).
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A
Brayton Purcell LLP v.
“Trademark . . . claims are akin to tort claims, and
therefore, are analyzed under the purposeful direction test.”
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One True Vine, LLC v. Liquid Brands LLC, No. C 10–04102, 2011 WL
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2148933, at *4 (N.D. Cal. May 31, 2011).
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Inc. v. Bobosky, No. CV 10-603, 2010 WL 4365795, at *4 (D. Or.
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Oct. 8, 2010) (“In trademark infringement cases, however, Ninth
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Circuit courts have used both purposeful direction and purposeful
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availment frameworks simultaneously . . . .”), adopted by Civil
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No. 10-603, 2010 WL 4364609 (D. Or. Oct. 28, 2010).
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Plaintiff relies on purposeful direction.
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But cf. Adidas Am.,
The Ninth
Circuit analyzes purposeful direction using the “Calder effects”
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test, originated in Calder v. Jones, 465 U.S. 783 (1984).
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Brayton Purcell, 606 F.3d at 1128.
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“[t]he defendant allegedly must have (1) committed an intentional
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act, (2) expressly aimed at the forum state, (3) causing harm
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that the defendant knows is likely to be suffered in the forum
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state.”
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quotation marks omitted).
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See
Under the effects test,
Id. (quoting Yahoo!, 433 F.3d at 1206) (internal
Because the first and third factors are easiest to
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address, the court will discuss those factors first before
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determining whether defendants expressly aimed at the forum.
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1.
Intentional Act
“‘Intentional act’ has a specialized meaning in the
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context of the Calder effects test.”
Schwarzenegger, 374 F.3d at
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806.
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act in the real world” and need not have intended “to accomplish
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a result or consequence of that act.”
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case performed such intentional acts when they designed and
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launched their website, registered metatags with Google, created
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their Facebook page, and used that page to interact with their
A defendant need only have performed “an actual, physical
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Id.
Defendants in this
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“fans.”
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copyrighted material on passive website was an intentional act);
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Nutrishare, Inc. v. BioRX, L.L.C., No. 08-1252, 2008 WL 3842946,
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at *7 (E.D. Cal. Aug. 14, 2008) (using a protected trademark in
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online advertisements was an intentional act).
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requirement of the Calder test is met.
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2.
See, e.g., Purcell, 606 F.3d at 1128 (posting
The first
Defendants Knew Harm Was Likely in California
Under the third prong of the Calder test, a plaintiff
must show that a defendant has caused harm it “knew was likely to
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be suffered in the forum state.”
Brayton Purcell, 606 F.3d at
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1131 (citing Yahoo! 433 F.3d at 1206).
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satisfied when defendant's intentional act has ‘foreseeable
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effects’ in the forum.”
“This element is
Id. (citing Bancroft, 223 F.3d at 1087).
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The Ninth Circuit “has repeatedly held that a
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corporation incurs economic loss, for jurisdictional purposes, in
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the forum of its principle place of business.”
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Inc. v. AcademyOne, Inc., No. 09-56528, --- F. Supp. 2d ---,
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----, 2011 WL 3437040, at *10 (9th Cir. 2011) (citing Dole Food
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Co., Inc. v. Watts, 303 F.3d 1104, 1113-14 (9th Cir. 2002);
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Panavision Int’l, L.P. v. Toeppen, 141 F.3d 1482, 1322 n.2 (9th
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Cir. 1998); Core-Vent Corp. v. Nobel Indus. AB, 11 F.3d 1482,
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1487 (9th Cir. 1993)).
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case is the damage to the trademark owner’s reputation, see Au-
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Tomotive Gold Inc. v. Volkswagen of Am., Inc., 603 F.3d 1133,
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1137 (9th Cir. 2010), and economic loss caused by intentional
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infringement of a plaintiff’s trademark is foreseeable, see
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Brayton Purcell, 606 F.3d at 1131 (economic loss caused by
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intentional copyright infringement is foreseeable).
CollegeSource,
The injury in a trademark infringement
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Plaintiff’s principal place of business is in
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California and it holds trademark rights to the terms “Cupcake”
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and “Red Velvet” as applied to wine and spirits.
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made aware of these facts when they received plaintiff’s February
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2011 letter and, therefore, could know it was likely that they
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would cause plaintiff harm in the forum.
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Defendants were
In response to plaintiff’s allegation that defendants
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have intentionally interfered with plaintiff’s trademark,
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damaging its brand and causing consumer confusion, defendants
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respond that because they have not sold any products in the forum
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and are unaware of any sales of their products in the forum, they
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could not know that plaintiff would suffer harm in the forum.
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They further claim that for that same reason, a lack of in-forum
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sales, plaintiff cannot have actually suffered any harm in the
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forum, foreseeable or not.3
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defendant’s out of forum actions may cause a plaintiff likely,
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foreseeable injury in forum.
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Schwarzenegger, 374 F.3d at 803).
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satisfied.
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3.
Yahoo, 433 F.3d at 1206 (citing
The third Calder factor is
Express Aiming
The express aiming requirement is met when “the
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The cases, though, make clear that a
defendant is alleged to have engaged in wrongful conduct targeted
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Defendants report that a search on Google for the term
“cupcake vodka” yields only results related to plaintiff for the
first two pages. (Knight Decl. II ¶ 14.) Because the court’s
ruling does not rely solely on harm caused by defendants’ use of
metatags, the court will not address the question of whether
defendants’ submission would shift the burden to plaintiff to
submit evidence supporting the challenged allegations, but does
point out that defendants did not submit evidence of the results
of a similar search for the trademarked term “Red Velvet.”
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at a plaintiff whom the defendant knows to be a resident of the
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forum state.”
Dole Food, 303 F.3d at 1111.
The invention of the Internet has posed a challenge to
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traditional jurisdictional analysis and courts have “struggled
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with the question whether tortious conduct on a nationally
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accessible website is expressly aimed at any, or all, of the
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forums in which the website can be viewed.”
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Brand Technologies, 647 F.3d 1218, 1229 (9th Cir. 2011) (citing
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cases).
Mavrix Photo Inc. v.
It is well established that posting information on a
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passive website alone is insufficient to confer jurisdiction in
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all states in which that website is be accessed.
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(citing Brayton Purcell, 606 F.3d at 1129).
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Id. at 1229
“[O]perating even a passive website in conjunction with
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‘something more’--conduct directly targeting the forum--is
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sufficient” to establish jurisdiction.
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Int’l Interlink, 284 F.3d 1007, 1020 (9th Cir. 2002).
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that facilitate and encourage interactions may form the basis for
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jurisdiction, and this is especially likely to be the case if the
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interactions are commercial in nature.
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Cybersell, Inc., 130 F.3d 414, 419 (9th Cir. 1997) (citing Zippo
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Manuf. Co. v. Zippo Dot Com, Inc., 952 F. Supp. 1119, 1124 (W.D.
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Pa. 1997)).
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Rio Props, Inc. v. Rio
Websites
Cybersell, Inc. v.
When evaluating whether a non-resident’s online
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activity satisfies the expressly aimed prong of the effects test,
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courts have considered “the interactivity of the defendant’s
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website, e.g., Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1153-54,
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1158 (9th Cir. 2006); Cybersell, 130 F.3d at 417-20[,] the
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geographic scope of the defendant’s commercial ambitions, e.g.,
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Pebble Beach, 453 F.3d at 1156-58; Rio Props, 284 F.3d at 1020-
2
21[,] and whether the defendant ‘individually targeted’ a
3
plaintiff known to be a forum resident, e.g., Brayton Purcell,
4
606 F.3d at 1129; Pebble Beach, 453 F.3d at 1156-57; Panavision,
5
141 F.3d at 1321-22.”
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aggregate effect of a defendant’s contacts with the forum that
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courts consider, not individual acts taken in isolation, to
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determine if jurisdiction exists.
9
(jurisdiction may be appropriate where there is “a series of
Mavrix Photo, 647 F.3d at 1229.
It is the
See Love, 611 F.3d at 606-07.
10
ongoing efforts by the defendant to avail itself of the benefits
11
of the [forum] market,” but not where defendant has only single,
12
isolated contacts with the forum state unconnected to the
13
tortious act) (quoting Sinatra v. Nat’l Enquirer, Inc., 854 F.2d
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1191, 1193 (9th Cir. 1988))); Panavision, 141 F.3d at 1321-22.
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i.
Interactivity
In Nutrishare, this court found that a website with a
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discussion board allowing visitors to post messages and chat
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online with employees of the defendant, a referral section
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allowing visitors to sign up to become customers, and a “Contact
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Us” e-mail page allowing visitors to request further information
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was not interactive enough, on its own, to show express aiming.
22
Nutrishare, Inc., 2008 WL 3842946, at *8.
23
Defendants’ own website is a passive website that
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allows one-way communication with site users.
Holland Am. Line
25
Inc. v. Wartsila N. Am., Inc., 485 F.3d 450, 460 (9th Cir. 2007).
26
Website visitors can access advertising material that defendants
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post, but defendants do not make any sales and there are no
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interactive features.
There is a “Contact Us” link consumers can
13
1
click on to send an email to defendants, but such features do not
2
make a website “interactive.”
3
419 (website that invited visitors to email defendant was
4
“essentially passive”); Pebble Beach, 453 F.3d at 1154-55
5
(characterizing website with link allowing users to contact
6
defendant as “passive”).
7
online presence, their online activities would be unlikely to
8
form an adequate basis for jurisdiction in California.
9
Defendants also maintain a Facebook page for
See Cybersell, 130 F.3d at 416,
If defendants’ website was their only
10
advertising purposes that has several interactive features.
11
Visitors can use the page to post comments and questions on a
12
message board and can sign up to be “fans” of the product.
13
Defendants use the page to respond to questions posted by their
14
“fans,” send messages to their fans’ Facebook accounts, and
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solicit applicants for “Brand Ambassador” positions.
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defendants’ Facebook page shares some features with the page in
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Nutrishare, it is both less interactive and less commercial and
18
would therefore be inadequate, standing alone, to show express
19
aiming.
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relevant to a jurisdictional inquiry, however, the interactive
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and commercial nature of defendants’ online activities support
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jurisdiction.
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24
While
Considered as a part of the totality of circumstances
ii.
Scope of Commercial Ambition
Courts have found express aiming where defendants used
25
the Internet and other widely accessible methods of communication
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to seek commercial benefit in a forum’s market.
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Purcell, 606 F.3d at 1130 (express aiming at forum where nothing
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on law firm’s website indicated that its practice area was did
14
Compare Brayton
1
not include the forum) and Mavrix, 647 F.3d at 1231 (“where . . .
2
a website with national viewership and scope appeals to, and
3
profits from, an audience in a particular state, the site’s
4
operators can be said to have ‘expressly aimed’ at that state”)
5
with Schwarzenegger, 374 F.3d at 807 (no express aiming where
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print advertisement was never circulated in California and
7
defendant had no reason to believe that any Californians would
8
see it).
9
Plaintiff alleges that defendants’ goal is to sell its
10
vodka throughout the United States, including in the forum state.
11
Defendants’ website indicates that Desirée vodka is “Coming soon”
12
to all fifty states, and it has used its Facebook page to
13
communicate with consumers throughout the country, including
14
forum residents, and has engaged in an unsuccessful discussion
15
with a forum-based distributor.
16
insufficient on their own to confer jurisdiction.
17
at 609; One True Vine, 2011 WL 2148933, at *6.
18
provide evidence that defendants are “cultivat[ing]. . .
19
nationwide audiences for commercial gain,” Mavrix, 647 F.3d at
20
1230, and that California is a part of that desired audience.
21
Cf. Love, 611 F.3d at 609 (no jurisdiction where the defendant’s
22
allegedly harmful acts were directed entirely at markets in
23
Ireland and the United Kingdom); Schwarzenegger, 374 F.3d at 807
24
(no jurisdiction where defendant’s “express aim was local”).
25
Defendants have not made any California sales and,
These facts, again, would be
Love, 611 F.3d
However, they do
26
because they do not hold any California licenses, cannot directly
27
make any California sales.
28
however, does not end the inquiry as jurisdiction can be
The lack of sales in the forum,
15
1
established in the absence of sales to forum residents.
See
2
Brayton Purcell, 606 F.3d at 1129-30 (jurisdiction existed even
3
though defendant law firm had not accepted any forum residents as
4
clients); CollegeSource, Inc., 2011 WL 3437040, at *2
5
(jurisdiction existed even though website had no paying customers
6
who were forum citizens).
7
intentions.
8
website indicates that they intend to enter California markets in
9
the future and to interest prospective California consumers in
What is significant are defendants’
See Schwarzenegger, 374 F.3d at 807.
Defendants’
10
their product.
11
defendants have said or done indicates that their “express aim”
12
was directed at forums other than California.
13
Unlike the defendants in Schwarzenegger, nothing
Id.
“Not all material placed on the Internet is, solely by
14
virtue of its universal accessibility, expressly aimed at every
15
state in which it is accessed,” Mavrix, 647 F.3d at 1231, but in
16
this case defendants’ business plan is to target all fifty
17
states, including California.
18
online with “every reason to believe prospective [customers] in
19
[the forum] would see the website--indeed, attracting new
20
business was the point.”
21
Plaintiff’s allegations are enough to suggest that defendants
22
online activities are intended to attract California consumers
23
for commercial gain, a fact which supports a finding that
24
jurisdiction exists.
25
26
Defendants placed their website
Brayton Purcell, 606 F.3d at 1130.
iii. Individual Targeting
The third factor upon which courts have relied to show
27
express aiming is individualized targeting of a forum resident.
28
In the Ninth Circuit, “the ‘expressly aimed’ prong of the
16
1
purposeful direction test is met where a plaintiff alleges that
2
the defendant individually targeted him by misusing his
3
intellectual property on the defendant’s website for the purpose
4
of competing with the plaintiff in the forum.”
5
609 n.4.
6
with forum residents “enable or contribute to the promotion
7
activities that [give] rise to the law suit.”
8
9
Love, 611 F.3d at
The plaintiff must show that the defendant’s contacts
Id. at 609.
Plaintiff seems to believe it sufficient to claim that
defendants knew that it was located in California and therefore
10
individually targeted it in the forum when it made use of its
11
trademarked material.
12
be satisfied by reciting the same facts used to show that
13
defendant caused harm it knew plaintiff was likely to suffer in
14
the forum state.
15
2011 WL 2148933, at *4 (“[T]he infringement of a plaintiff’s
16
intellectual property rights with knowledge that plaintiff’s
17
operations are based in the forum and that the harm will be felt
18
there, is insufficient to establish personal jurisdiction without
19
a further showing that the defendant otherwise expressly aimed
20
its activities at the forum.”).
21
However, the expressly aimed prong cannot
Pebble Beach, 647 F.3d at 1158; One True Vine,
In CollegeSource, one website offering college referral
22
services copied material from a competitor’s website and posted
23
it on its own site.
24
made phone calls and sent emails and letters to the plaintiff
25
seeking to purchase the copied material.
26
3437040, at *1-*2.
27
were a part of the defendant’s efforts to obtain and make
28
commercial use of the plaintiff’s copyrighted material and showed
Prior to posting the material, the defendant
CollegeSource, 2011 WL
The court found that these communications
17
1
that in posting the infringing materials defendant had
2
intentionally aimed at the plaintiff in the forum.
3
Id. at *9.
Defendants, unlike those in CollegeSource, did not have
4
any contacts with the forum state that enabled or contributed to
5
their promotional activities.
6
intentionally misused plaintiff’s trademarks in order to exploit
7
its brand and undermine it in California markets.
8
allegations might be sufficient to create a jurisdictional basis
9
on an individual targeting theory, defendants contested this
Plaintiff alleges that defendants
While such
10
allegation by filing the affidavit of Jerry Knight, in which he
11
claims that defendants’ product line was developed without
12
reference to plaintiff’s and is not part of a scheme to exploit
13
plaintiff’s trademarks.
14
defendant has contradicted allegations in the complaint, the
15
burden is on the plaintiff to present admissible evidence which
16
would support the challenged allegations, Harris Rutsky, 328 F.3d
17
at 1129, and plaintiff has not met that burden.
18
Purcell, 606 F.3d at 1129 (defendant’s “conclusory denial”
19
inadequate to rebut plaintiff’s allegation of intentional
20
copyright violations).
21
distributor did not bear fruit, and so cannot form the basis for
22
jurisdiction.
23
forum residents did not contribute to the promotion activities
24
that gave rise to the law suit and so could not form a basis for
25
jurisdiction).
26
(Knight Decl. II ¶¶ 7-12)
Once a
Cf. Brayton
Defendants discussions with a California
See Love, 611 F.3d at 609 (failed discussions with
When each factor is examined in isolation, defendants’
27
individual actions are insufficient to show express aiming.
28
viewed in the aggregate, however, defendants’ national marketing
18
When
1
strategy is revealed as, in part, an effort by defendants “to
2
avail itself of the benefits of the [forum] market.”
3
F.3d at 609 (quoting Sinatra v. Nat’l Enquirer, Inc., 854 F.2d
4
1191, 1193 (9th Cir. 1988)).
5
defendants employ several websites that they use to interact with
6
customers and potential customers in order to get people excited
7
about their product, whether it is available on store shelves in
8
their state or not.
9
material to which a forum resident informed them it held
Love, 611
As a part of this strategy,
In these online activities, defendants use
10
trademark rights.
11
defendants’ online activities are commercial activities aimed in
12
part at potential customers in the forum.
13
allegations as a whole tend to show express aiming, and therefore
14
are sufficient to meet the effects test, the court will address
15
the remaining prongs of the Ninth Circuit specific jurisdiction
16
test.
17
18
B.
Although they do not make sales online,
Because plaintiff’s
Arising Out Of
A court cannot establish personal jurisdiction over a
19
defendant unless a plaintiff can show that its claims “arise[]
20
out of the defendant’s forum related activities.”
21
141 F.3d at 1322.
22
determines that a plaintiff would not have suffered injury “but
23
for” the conduct directed by the defendant towards the plaintiff
24
in the forum state.
25
Panavision,
This requirement is met if the court
Id.
Plaintiff alleges that defendants’ use of its
26
trademarks was intended to damage the value of those trademarks
27
and to build a national brand by exploiting the goodwill that
28
plaintiff has created.
Although defendants did not specifically
19
1
target their online advertisements at a particular state, they
2
also did not pursue a regional or state-specific strategy.
3
Instead they targeted all fifty states, including California.
4
Plaintiff claims that defendants’ online activities have caused
5
customer confusion and damaged their brand’s value.
6
purposes of this motion, the court must take allegations that the
7
defendant has not contradicted as true.
8
at 1129.
For the
Harris Rutsky, 328 F.3d
According to plaintiff’s allegations, but for the
9
10
online advertising campaign defendants carried out, it would not
11
have suffered the complained of injuries.
12
has met its burden to allege facts sufficient to show that its
13
claims arise out of defendants’ forum related activity, and has
14
satisfied all three factors necessary to establish a prima facie
15
case for specific jurisdiction.
16
17
C.
Accordingly, plaintiff
Reasonableness
Once a plaintiff has established a prima facie case
18
that specific jurisdiction is constitutional, the burden shifts
19
to the defendant to demonstrate why jurisdiction would be
20
unreasonable in light of traditional considerations of fair play
21
and substantial justice.
22
Burger King, 471 U.S. at 477).
23
must present a “compelling case that the presence of some other
24
considerations would render jurisdiction unreasonable.”
25
Garcia, 942 F.2d 617, 625 (quoting Shute v. Carnival Cruise
26
Lines, 897 F.2d 377, 386 (9th Cir. 1990)) (emphasis in original).
27
The Ninth Circuit considers seven factors in determining whether
28
jurisdiction would be reasonable: “(1) the extent of the
Dole Food, 303 F.3d at 1114 (citing
To meet this burden, a defendant
20
Roth v.
1
defendant’s purposeful injection into the forum state’s affairs;
2
(2) the burden on the defendant of defending in the forum; (3)
3
the extent of conflict with the sovereignty of the defendant’s
4
state; (4) the forum state’s interest in adjudicating the
5
dispute; (5) the most efficient judicial resolution of the
6
controversy; (6) the importance of the forum to the plaintiff’s
7
interest in convenient and effective relief; and (7) the
8
existence of an alternative forum.”
9
Psychoanalytical Ass’n, 59 F.3d 126, 128 (9th Cir. 1995).
Caruth v. Int’l
10
Defendants raise arguments related to only factors (2), (4), and
11
(5).
Defendants are headquartered in Indiana so it is likely
12
13
they will be burdened by having to litigate these claims in a
14
California court.
15
to litigate this case in California than it would be to litigate
16
it in their home state, it will be only marginally more
17
difficult.
18
telecommunications and the increasing interstate practice of law,
19
any burden [of litigating in a forum other than one’s residence]
20
is substantially less than in days past.”
21
3437040, at *12 (citing Menken, 503 F.3d at 1060); see also CE
22
Distrib., LLC v. New Sensor Corp., 380 F.3d 1107, 1112 (9th Cir.
23
2004) (burden on New York resident of litigating in Arizona
24
weighed only “slightly” in defendant’s favor).
25
While it may be more difficult for defendants
“With the advances in transportation and
CollegeSource, 2011 WL
It is not clear that a California forum would be
26
unreasonably inefficient.
Documents and witnesses pertinent to
27
establishing the facts in dispute may be located in Indiana, but
28
one of the two full-time employees employed by defendants lives
21
1
in Illinois, (Knight Decl. II ¶ 12), and plaintiff has indicated
2
that it believes it will need to call several California
3
residents in order to put on its case, (Reidl Decl. ¶ 9).
4
Defendants have not shown that considerations of efficiency
5
dictate that the litigation be removed from California,
6
especially since “this factor is ‘no longer weighed heavily given
7
the modern advances in communication and transportation.’”
8
Harris Rutsky, 328 F.3d at 1133 (quoting Panavision Int’l, 141
9
F.3d at 1323).
Contrary to defendants’ claims, California does have an
10
11
interest in adjudicating this suit.
12
has been injured by defendants’ tortious conduct, and California
13
has an interest in protecting its citizens, of which plaintiff is
14
one, from injury.
15
in providing an effective means for redress for its residents
16
[who are] tortiously injured” (quoting Sinatra, 854 F.2d at
17
1200)).
18
Plaintiff alleges that it
Id. (“California maintains a strong interest
Defendants have not met the “heavy burden” they face
19
“in proving a ‘compelling case’ of unreasonableness to defeat
20
jurisdiction.”
21
true given that exercising jurisdiction in California would not
22
conflict with the sovereignty of the defendant’s state.
23
Plaintiff’s claims arise under federal law and analysis of those
24
federal claims would be the same in California or in Illinois,
25
therefore defendants would not be held subject to the laws of a
26
foreign jurisdiction.
27
28
Dole Food, 303 F.3d at 1117.
This is especially
Panavision, 141 F.3d at 1323.
The court additionally notes that the Ninth Circuit has
taken a “flexible approach” to personal jurisdiction.
22
Ochoa v.
1
J.B. Martin and Sons Farms, Inc., 287 F.3d 1182, 1189 n.2 (9th
2
Cir. 2002) (citing Brand v. Menlove Dodge, 796 F.2d 1070, 1074
3
(9th Cir. 1986).
4
jurisdiction “can be established with a lesser showing of minimum
5
contacts where considerations of reasonableness dictate.”
6
(citing Haisten v. Grass Velley Med. Reimbursement Fund, Ltd.,
7
784 F.2d 1392, 1397 (9th Cir. 1986)).
8
jurisdiction admit of no simple solutions and . . . ultimately
9
due process issues of reasonableness and fairness must be decided
Under this flexible approach, personal
Id.
“Questions of personal
10
on a case-by-case basis.”
11
Steel Bldgs. Corp., No. CV-08-854, 2009 WL 1476990, at *11 (May
12
26, 2009, E.D. Cal. 2009) (quoting Forsythe v. Overmyer, 576 F.2d
13
779, 783 (9th Cir. 1978)).
14
cases in which the defendant has not purposely directed its
15
activities at the forum state, but has created sufficient
16
contacts to allow the state to exercise personal jurisdiction if
17
such exercise is sufficiently reasonable.”
18
Co., Inc. v. DMH Ingredients, Inc., No. 07-2247, 2008 WL 1721903,
19
at *3 (E.D. Cal. 2008) (quoting Brand, 796 F.2d at 1074).
20
Davis Moreno Constr., Inc. v. Frontier
“Under this analysis, there will be
Golden Gate Beverage
Where a defendant has created a website aimed at a
21
national audience with the express purpose of attracting a
22
national consumer base, it is not “random” or “fortuitous” for
23
residents in any one state to come into contact with the
24
defendants’ website.
25
website that deliberately creates and profits from its national
26
viewership and scope, over whom jurisdiction would be
27
appropriate, from a local or private internet post not intended
28
and not expected to be viewed throughout the country).
Mavrix, 647 F.3d at 1231 (distinguishing a
23
1
Defendants may not have targeted California markets in their
2
advertising, but they also did not target their advertising at
3
specific states or make an effort to exclude California from
4
their advertising.
5
the ability to reach a national audience in an attempt to create
6
national demand for their product.
7
to hold them nationally accountable.
8
at 473-74 (“[W]here individuals ‘purposefully derive benefit’
9
from their interstate activities, it may well be unfair to allow
10
them to escape having to account in other States for consequence
11
that arise predictably from such activities; the Due Process
12
Clause may not readily be wielded as a territorial shield . . .
13
.” (quoting Kulko v. California Superior Court, 436 U.S. 84, 96
14
(1978))).
15
Instead, they used technologies giving them
It does not seem unreasonable
See Burger King, 471 U.S.
Defendants have asked that this proceeding be
16
transferred to the Southern District of Indiana.
Under 28 U.S.C.
17
§ 1391(b) and (c), in case predicated on federal claims, a
18
corporate defendant may be subject to jurisdiction in any venue
19
in which it is subject to personal jurisdiction.
20
1391(b)-(c).
21
jurisdiction over defendants, venue in this court is proper.
22
“For the convenience of parties or witness, in the
23
interest of justice, a district court may transfer any civil
24
action to any other district . . . .”
25
There is a strong presumption in favor of a plaintiff’s choice of
26
venue, and that choice will only be disturbed if a defendant can
27
make a “strong showing” that another venue is more convenient.
28
Gherebi v. Bush, 352 F.3d 1278, 1302 (9th Cir. 2003) (overruled
28 U.S.C. §
As the court has determined that it has personal
24
28 U.S.C.A. § 1404(a).
1
on other grounds).
In this case, shifting venue to Southern
2
Indiana would merely transfer the inconvenience of litigating in
3
another state from plaintiffs to defendants, and neither party
4
has shown that they would suffer disproportionate inconvenience.
5
As 28 U.S.C. 1304(a) “provides for transfer to a more convenient
6
forum, ‘not a more likely to prove equally convenient or
7
inconvenient,’” the court will not order transfer merely to shift
8
litigation inconveniences from one party to the other.
9
(quoting Van Dusen v. Barrack, 376 U.S. 612, 646 (1964).
Id.
10
IT IS THEREFORE ORDERED that defendants’ motion to
11
dismiss for lack of personal jurisdiction or to transfer for
12
improper venue be, and the same hereby is, DENIED.
13
DATED:
October 5, 2011
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