West Marine, Inc v. Watercraft Superstore, Inc

Filing 35

ORDER (1) DENYING 3 DEFENDANT'S MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION; (2) DENYING DEFENDANT'S ALTERNATIVE MOTION TO TRANSFER VENUE; AND (3) GRANTING 15 PLAINTIFF'S REQUEST FOR JUDICIAL NOTICE. Signed by Magistrate Judge Howard R. Lloyd on 2/14/2012. (hrllc1, COURT STAFF) (Filed on 2/14/2012)

1

** E-filed February 14, 2012 **

2
3
4
5
6

IN THE UNITED STATES DISTRICT COURT

9

FOR THE NORTHERN DISTRICT OF CALIFORNIA

10

For the Northern District of California

NOT FOR CITATION

8

United States District Court

7

SAN JOSE DIVISION

11

WEST MARINE, INC.,
Plaintiff,

12
v.
13

WATERCRAFT SUPERSTORE, INC.,
14
15

Defendant.
____________________________________/

No. C11-04459 HRL
ORDER (1) DENYING DEFENDANT’S
MOTION TO DISMISS FOR LACK OF
PERSONAL JURISDICTION; (2)
DENYING DEFENDANT’S
ALTERNATIVE MOTION TO
TRANSFER VENUE; AND (3)
GRANTING PLAINTIFF’S REQUEST
FOR JUDICIAL NOTICE

16
[Re: Docket Nos. 3, 15]
17
18
19
20
21
22
23
24
25
26
27
28

Plaintiff West Marine, Inc. (“West Marine”) brought this action against defendant Watercraft
Superstore, Inc. (“Watercraft”) in Santa Cruz County Superior Court for breach of oral agreement,
breach of the covenant of good faith and fair dealing, intentional and negligent interference with
economic advantage, declaratory and injunctive relief, unjust enrichment, quantum meruit, and
promissory estoppel. Dkt. No. 1, Exh. 1 (“Complaint”). Both of the parties are purveyors of boating
equipment; West Marine sells a broad array of “boating supplies and accessories,” while Watercraft
specializes in personal watercraft, or jet skis. Complaint ¶¶ 2-3. This action arises out of failed
negotiations between the parties to execute an agreement to govern their shared use of a mark (“the
mark” or “Blacktip mark”) that both parties attempted to register with the U.S. Patent and
Trademark Office (“USPTO”). Complaint ¶¶ 8-9, 13-14. Watercraft timely removed the action to
this court on the basis of diversity jurisdiction. Dkt. No. 1 (“Notice of Removal”). Both of the
parties have consented to the undersigned’s jurisdiction.

1

Watercraft now moves to dismiss for lack of personal jurisdiction, or, in the alternative, to

2

transfer venue to the Middle District of Florida. Dkt. No. 3 (“Motion to Dismiss”). West Marine has

3

opposed the motions. Dkt. No. 14. Watercraft has replied. Dkt. No. 17. The court deemed the

4

motions suitable for determination without oral argument and vacated the February 14, 2012

5

hearing. Dkt. No. 34. Upon consideration of the moving papers and applicable authority, the court

6

DENIES defendant’s motion to dismiss and its alternative motion to transfer this case to the Middle

7

District of Florida. The court GRANTS plaintiff’s request for judicial notice.

8

I.

MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION

9

LEGAL STANDARD

For the Northern District of California

United States District Court

10

A defendant may move, prior to trial, to dismiss an action for lack of personal jurisdiction.

11

Data Disc, Inc. v. Systems Tech. Assoc., Inc., 557 F.2d 1280, 1285 (9th Cir. 1977); Fed. R. Civ. P.

12

12(b)(2). The defendant must object to the court’s exercise of personal jurisdiction in the first Rule

13

12 motion or in the responsive pleading or be deemed to have waived the issue. Fed. R. Civ. P.

14

12(h)(1). The party seeking to invoke jurisdiction of the federal court has the burden of establishing

15

that such jurisdiction exists. Id. at 1285. At this stage of the litigation, the plaintiff need only “make,

16

through [his] pleadings and affidavits, a prima facie showing of the jurisdictional facts.” Myers v.

17

Bennett Law Offices, 238 F.3d 1068, 1071 (9th Cir. 2001). In ruling on a Rule 12(b)(2) motion, the

18

court should view the pleadings in a light most favorable to plaintiff and all doubts are to be

19

resolved in his favor. Caruth v. Int'l Psychoanalytical Ass'n, 59 F.3d 126, 128 n. 1 (9th Cir. 1995).

20

When there is no applicable federal statute governing personal jurisdiction, the law of the

21

state in which the district court is located is applicable. California's long-arm statute, Cal. Code Civ.

22

P. § 410.10, permits the exercise of jurisdiction “on any basis not inconsistent with the Constitution

23

of this state or of the United States.” Aanestad v. Beech Aircraft Corp., 521 F.2d 1298, 1300 (9th

24

Cir. 1974). Due process requires that a court only exercise jurisdiction over a nonresident defendant

25

if that defendant has “minimum contacts” with the forum state such that maintenance of the suit

26

does not offend traditional notions of fair play and substantial justice. Int'l Shoe Co. v. Wash., 326

27

U.S. 310, 316 (1945). Each defendant's contacts with the forum state are evaluated individually.

28

Calder v. Jones, 465 U.S. 783, 790 (1984).

2

1

There are two types of personal jurisdiction: general and limited (or specific) jurisdiction.

2

Historically, a court’s ability to render judgment in personam was grounded in its power over the

3

defendant’s person, making the defendant’s physical presence in the forum state prerequisite to a

4

binding judgment. Pennoyer v. Neff, 95 U.S. 714, 733 (1878). But, if a nonresident defendant’s

5

activities within the state are “substantial” or “continuous and systematic,” there is a sufficient

6

relationship between the defendant and the forum state to support general personal jurisdiction, even

7

though the claim is unrelated to the defendant's forum activities. Data Disc, 557 F.2d at 1287. But, if

8

a nonresident defendant’s activities in the forum state are not “substantial” or “continuous,” a court

9

may only exercise limited personal jurisdiction, and only if there is a sufficient relationship between

For the Northern District of California

United States District Court

10
11

the defendant's contacts with the forum state and the claim at issue. Id.
“For the convenience of parties and witnesses, in the interest of justice, a district court may

12

transfer any civil action to any other district or division where it might have been brought.” 28

13

U.S.C. § 1404(a). A district court has discretion to decide motions to transfer venue based upon a

14

case-by-case consideration of convenience and fairness. Jones v. GNC Franchising, Inc., 211 F.3d

15

495, 498 (9th Cir. 2000) (quoting Stewart Org. v. Ricoh Corp., 487 U.S. 22, 29 (1988)).

16

DISCUSSION

17

Although the plaintiff devotes much of its attention to arguing for specific personal

18

jurisdiction, the court believes the better argument is for general personal jurisdiction, as discussed

19

below. When general jurisdiction is found, there is no need to consider whether specific personal

20

jurisdiction could also exist. Data Disc, 557 F.2d at 1287 (explaining that courts consider specific

21

jurisdiction only when a nonresident’s activities in the forum state are insufficient to give rise to

22

general jurisdiction).

23

West Marine shows the following contacts between Watercraft and the state of California as

24

proof that personal jurisdiction exists: (1) Watercraft operates two interactive websites accessible to

25

Californians, one for purchasing Watercraft products (“the store website”), and one where users can

26

access discussion boards, classified ads, listings for products available on the store website, news,

27

and other content relating to personal watercraft use (the “forum website”); (2) Watercraft, through

28

the forum website, establishes and promotes “riding groups” for jet ski users in specific geographic

3

1

regions, including two such groups in California; (3) Watercraft mails print catalogs to past

2

customers and to “‘mailing lists [Watercraft] ha[s] purchased,’” including to California residents;

3

(4) Watercraft’s sales to California consumers, which from 2009 through September 30, 2011 were

4

approximately $230,000, or 7.4% of its total sales in the three years it has been in business; (5)

5

Watercraft’s purchases of products from 13 California suppliers, which from 2009 through 2011

6

totaled $1.96 million; (6) Watercraft’s sales of products though Ebay, a California company; (7)

7

Watercraft’s contracts for the marketing of its products with YouTube, Facebook, and Google, all

8

California companies; and (8) Watercraft’s use of Paypal, a California company, as its online

9

payment processor. Dkt. No. 14, pp. 4-7 (“Opposition”). Since the claims at issue in this action do

For the Northern District of California

United States District Court

10

not arise out of any of these contacts, they support general, rather than specific, personal

11

jurisdiction.

12

Watercraft argues that these contacts are misleading and insubstantial. It contends that any

13

California customer who purchased products from its website or by calling its telephone number

14

“reache[ed] into Florida” to do so. Motion to Dismiss at 4. It also argues that the forum website is

15

actually owned by a separate company called SBT, which permits Watercraft to advertise on the site

16

in exchange for paying all hosting fees and moderating the website, and which created the “riding

17

groups” in 2006, before Watercraft came into existence (although Greg Pickren owns both

18

Watercraft and SBT). Reply, p. 5; Dkt. No. 18, p. 2 (“Supp. Pickren Dec.”); Dkt. No. 14, Exh. 2

19

(“Chang Dec.”) at Exh. A, p. 14:23 (“Pickren Deposition”). Next, Watercraft argues that because

20

West Marine is a much larger company than it is, this court should discount the amount of sales it

21

has done in California because that amount is far less than what West Marine sold during the same

22

period. Reply at 4. Finally, Watercraft argues that the fact that it has entered into contracts with

23

other California companies and agreed to venue in California is irrelevant to this inquiry and

24

threatens to expand this district’s exercise of personal jurisdiction over all users of those companies.

25

Reply at 5-6. These arguments tend to address specific rather than general jurisdiction, and, as

26

discussed below, may be inapposite to an analysis of general jurisdiction.

27

A. General Personal Jurisdiction

28

4

1

General personal jurisdiction may be exercised as to any cause of action, if the defendant is

2

domiciled in the forum state or if its activities there are “substantial” or “continuous and

3

systematic.” Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414-16 (1984).

4

“Factors to be taken into consideration are whether the defendant makes sales, solicits or engages in

5

business in the state, serves the state's markets, designates an agent for service of process, holds a

6

license, or is incorporated there.” Bancroft & Masters, Inc. v. Augusta Nat'l Inc., 223 F.3d 1082,

7

1086 (9th Cir. 2000) overruled in part on other grounds by Yahoo! Inc. v. La Ligue Contre Le

8

Racisme Et L'Antisemitisme, 433 F.3d 1199 (9th Cir. 2006) (en banc). The assertion of general

9

jurisdiction must always be reasonable. Amoco Egypt Oil Co. v. Leonis Navigation Co., 1 F.3d 848,

For the Northern District of California

United States District Court

10

852-53 (9th Cir. 1993). The Ninth Circuit has set a high standard for general jurisdiction. See

11

Yahoo! Inc., 433 F.3d at 1205.

12

As a preliminary matter, the court acknowledges that none of Watercraft’s contacts with

13

California, standing alone, would be adequate to confer general jurisdiction over Watercraft. But,

14

the court considers these contacts in the aggregate and finds that, while it is a close call, general

15

jurisdiction is warranted.

16

1. Watercraft’s interactive websites

17

“The degree of interactiveness of a defendant’s website is a factor that informs the

18

jurisdictional analysis.” Coremetrics, Inc. v. AtomicPark, LLC, 370 F. Supp. 2d 1013, 1021 (N.D.

19

Cal. 2005). The federal courts have adopted a sliding scale test that considers a website’s level of

20

interactivity “directly proportionate” to the likelihood that personal jurisdiction can be

21

constitutionally exercised. Zippo Mfg. Co. v. Zippo Dot Com, Inc., 952 F. Supp. 1119, 1124 (W.D.

22

Pa. 1997). While “[t]he ‘mere accessibility of the defendants’ websites’” is insufficient to establish

23

jurisdiction, a website that allows customers to “engage in electronic transactions” with the

24

defendant may well prove sufficient. Gorman v. Ameritrade Holding Corp., 293 F.3d 506, 512

25

(D.C. Cir. 2002) (quoting GTE New Media Servs. Inc. v. Bell South Corp., 339 U.S. App. D.C. 332,

26

199 F.3d 1343, 1350 (D.C. Cir. 2000)). The Gorman court noted in particular that a defendant

27

whose website permits customers to conduct transactions in the same way that they could over the

28

phone or in person makes the defendant even more “susceptible to application of the ‘doing

5

1

business’ test” than traditional non-resident defendant companies. Gorman, 293 F.3d at 513. But,

2

without evidence of actual sales, even the most highly interactive website will not, alone, suffice to

3

establish general jurisdiction. Coremetrics, 370 F. Supp. 2d at 1019-20.

4

On Watercraft’s store website, customers can browse available products and place orders

5

online. Online purchases require customers to input personal information such as their names, email

6

addresses, payment information, and billing/shipping information. Customers can also subscribe to

7

Watercraft’s mailing list and establish accounts through the website. Like the defendant company in

8

Coremetrics, where the court found that general personal jurisdiction existed, Watercraft operates a

9

virtual store that acts just like a brick and mortar store and is “largely designed so as to approximate

For the Northern District of California

United States District Court

10

physical presence in a forum.” Coremetrics, 370 F. Supp. 2d at 1021. As measured by the Zippo

11

test, Watercraft’s store website clearly falls on the “highly interactive” end of the spectrum, where

12

the entity clearly does business over the Internet.

13

2. Watercraft’s sales in California

14

When an analysis of defendant’s online presence in the forum state is at issue, the existence

15

and extent of actual sales in the state are relevant. See Coremetrics, Inc., 370 F. Supp. 2d at 1022

16

(finding general jurisdiction where defendant made “substantial” sales into forum state through

17

interactive website, along with online advertising, purchases from forum state, and contracts with

18

third parties in forum state); Estate of Stephen Bank v. Swiss Valley Farms, Co., 286 F. Supp. 2d

19

514, 518 (D. Md. 2003) (“Without evidence of actual sales made to Maryland residents . . . a

20

website that merely offers the possibility of transacting . . . is insufficient for jurisdictional

21

purposes”). Indeed, “the most reliable indicator of the nature and extent of defendant's Internet

22

contact with the forum state will be the amount of sales generated in the state by or through the

23

interactive website.” Coastal Video Communications Corp. v. Staywell Corp., 59 F. Supp. 2d 562,

24

572 (E.D. Va. 1999).

25

According to the deposition of Watercraft owner Greg Pickren, sales to California customers

26

represent between 6% and 7.4% of Watercraft’s total sales over the three year period that it has been

27

operational. Pickren Deposition at 42:23-44:8. Watercraft states in its moving papers that California

28

sales constitute 7.4% of total sales. See Reply at 4. Pickren also testified that Watercraft has made

6

sales amounted to approximately $300,000. Pickren Deposition at 42:11-12. While this percentage

3

does not represent a majority of Watercraft’s sales, the court notes that it is much higher than sales

4

percentages in other cases where general jurisdiction was not found. See, e.g., Hockerson-

5

Halberstadt, Inc. v. Propet USA, Inc., 62 Fed. Appx. 322, 337 (Fed. Cir. 2003) (concluding that

6

there was no general jurisdiction over defendant who made only 0.00008 percent of its sales to

7

forum state); Injen Tech. Co. Ltd. v. Advanced Engine Mgmt., 270 F. Supp. 2d 1189, 1194 (S.D.

8

Cal. 2003) (noting that sales by defendant to forum state, which "account[ed] for only 2% of its total

9

business, are not the kind of systematic and continuous' contacts that would warrant the exercise of

10

For the Northern District of California

$4 million in total sales over its three years of operations, which would suggest that the California

2

United States District Court

1

general jurisdiction"); Molnlycke Health Care AB v. Dumex Med. Surgical Prods. Ltd., 64 F. Supp.

11

2d 448, 452 (E.D. Penn. 1999) (“it is impossible for the court to find that the small percentage of

12

sales [i.e., less than 1 percent] constitute continuous and systematic business within the forum

13

state”); StairMaster Sports/Med. Prods., Inc. v. Pac. Fitness Corp., 916 F. Supp. 1049, 1053 (W.D.

14

Wash. 1996) (finding insufficient contacts to justify general jurisdiction where only 3 percent of

15

defendant's sales were made to forum state), aff'd, 78 F.3d 602 (Fed. Cir. 1996); Tosco Corp. v. Sun

16

Co., Inc., No. C94-4190 FMS, 1995 U.S. Dist. LEXIS 4643, at *7-8 (N.D. Cal. Apr. 5, 1995)

17

(finding no general jurisdiction where contacts with forum state included, inter alia, only 0.0006

18

percent of total revenues for one year). Cf. Coremetrics, 370 F. Supp. 2d 1013, 1022 (finding

19

general jurisdiction where contacts with forum state included 14.71 percent of total sales).

20

In addition, Watercraft’s sales to California consumers are central to its business as an online

21

retailer, which weighs in favor of general jurisdiction. See Coremetrics, 370 F. Supp. 2d at 1023

22

(noting that sales are central to online retail business and therefore weigh in favor of finding general

23

jurisdiction); Provident Nat’l Bank v. California Fed. Savings & Loan Ass’n, 819 F.2d 434, 438 (3d

24

Cir. 1987) (distinguishing Helicopteros’ holding of no general jurisdiction on the ground that

25

defendant’s contacts with forum state were not central to its business).

26

As previously noted, Watercraft argues that the amount of sales it has done in California is

27

negligible when compared to West Marine’s much larger sales volume. See Reply at 4. However,

28

Watercraft has not provided any authority, and the court is not aware of any, that makes the parties’

7

1

relative sales revenue relevant to the question of whether personal jurisdiction over Watercraft

2

exists. Rather, the Ninth Circuit has said only that “sales” are one “factor[] to be taken into

3

consideration” when evaluating personal jurisdiction. See Bancroft, 223 F.3d at 1086. Under the

4

logic of Watercraft’s argument, any defendant sued by a company larger than itself could argue that,

5

by comparison, its presence in the forum state is negligible, and thereby defeat personal jurisdiction.

6

This court knows of no authority or policy justification for such a comparative analysis. Rather, it is

7

Watercraft’s contacts with California that are at issue, irrespective of whether those contacts dwarf

8

or are dwarfed by the contacts that plaintiff has with the forum state.

9

3. Watercraft’s internet advertising contracts with third parties with offices in California

For the Northern District of California

United States District Court

10

The Ninth Circuit has held that doing business in California is not the same as doing

11

business with California—and merely doing business with companies in California, without having

12

any other contacts, will not give rise to general jurisdiction. See Bancroft & Masters v. Augusta

13

Nat'L, 223 F.3d 1082, 1086 (9th Cir. 2000) (finding that a defendant company that was not

14

registered or licensed to do business in California, paid no taxes in California, held no bank

15

accounts there, had a passive website, and did not advertise there at all, but maintained contracts

16

with several California companies was not subject to general jurisdiction).

17

Additionally, agreeing to personal jurisdiction in California in advertising contracts with

18

third parties is not sufficient on its own to establish general jurisdiction. But the Supreme Court has

19

said that there is no authority to “suggest[] that a choice-of-law provision should be ignored in

20

considering whether a defendant has ‘purposefully invoked the benefits and protections of a State's

21

laws’ for jurisdictional purposes.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 482 (U.S. 1985).

22

In Burger King, the Court found that a non-resident defendant who executed a contract that

23

contained a choice of law provision and provided for oversight from a company in the forum state

24

over a 20-year period had established sufficient contacts for general personal jurisdiction. In this

25

case, Watercraft did enter into contracts with several California companies that contained choice of

26

law provisions designating California as the forum state, but it did not enter into any such contract

27

with West Marine.

28

8

1

Certainly, the fact that Watercraft agreed to submit to California jurisdiction in contracts

2

with entities not party to this action cannot alone suffice to establish general personal jurisdiction.

3

However, it does go to the reasonableness of Watercraft’s expectation that it might be haled into a

4

California court. See Coremetrics, 370 F. Supp. 2d at 1024.

5

4. Watercraft’s online and mail advertising

6

Watercraft sends mail catalogs to past customers as well as to mailing lists it has purchased,

7

and it advertises through the websites of Google, Facebook, and Youtube, the companies with

8

whom it has entered into advertising contracts. Watercraft argues that it generates “one-size-fits-all”

9

advertisements, and never “targets” California consumers. Reply at 4. However, neither does it seek

For the Northern District of California

United States District Court

10

to exclude California consumers from its advertising efforts. See Coremetrics at 1021-22 (“At the

11

very least, although [defendant] may not have targeted California consumers specifically, it has

12

reached out across the nation to promote its services” (emphasis added)). Watercraft’s argument

13

that its advertisements reach California consumers only because they “happen to be located there”

14

borders on the disingenuous. All consumers “happen to be located” wherever they live, and it is

15

unrealistic for an entity that advertises both online and through postal mail to imagine that it

16

establishes no contacts with states where its customers “happen to be located.” If Watercraft’s

17

argument is taken to its logical end, a defendant could inundate states with non-state-specific

18

advertisements and yet argue that it had not created any contacts with the states by doing so. If

19

Watercraft’s advertisements invite orders from California residents (and from everyone else), it

20

cannot claim that it never directed advertising toward California. See Ty, Inc. v. Baby Me Inc. 2001

21

U.S. Dist. LEXIS 5761, 23 (N. D. Ill. Apr. 25, 2011).

22

5. Watercraft’s purchases from California suppliers

23

In Helicopteros, the Supreme Court concluded that “mere purchases,” even if such purchases

24

occurred at regular intervals, were not themselves sufficient to establish general personal

25

jurisdiction. Helicopteros, 466 U.S. 408, 418. However, in Helicopteros, defendant’s purchases in

26

the forum state, Texas, were not related to its central business, helicopter services for South

27

American oil and construction industries, which weighed against a finding of general jurisdiction

28

9

1

despite the fact that it made a majority of its purchases in the forum state. See Provident National

2

Bank, 829 F.2d at 438.

3

Watercraft appears to obtain a substantial portion of its inventory from California suppliers.

4

In his deposition, Pickren testified that California suppliers make up “in the range of about 30

5

percent” of all of Watercraft’s purchases. Pickren Deposition 39:16-17. West Marine alleges, and

6

Pickren confirmed in his deposition, that Watercraft’s purchases from these 13 California suppliers

7

cost $1.96 million in total. Opposition at 7; Pickren Deposition at 30:9-25. Like sales in a forum

8

state, purchases are indicative of Watercraft’s business activities in the forum state. It is apparent

9

that, even if Watercraft does a minority of its sales in California, it obtains a significant portion of

For the Northern District of California

United States District Court

10

its inventory from companies located there. Although Watercraft purchases less of its inventory

11

from California that the defendants in Helicopteros did from Texas, its purchases are directly related

12

to its business—selling those same items to consumers.

13

In summary, although none of these elements alone could confer general jurisdiction over

14

Watercraft, when taken in their entirety, they establish a “substantial and continuous” link between

15

Watercraft and the state of California. Multiple aspects of Watercraft’s business, from purchasing

16

inventory to advertising to sales, bring it into contact with California consumers and businesses.

17

This court concludes that, based on the totality of Watercraft’s contacts with California, they are

18

sufficiently substantial, continuous, and systematic to support a finding of general jurisdiction.

19

6. Reasonableness of Personal Jurisdiction

20

Even after the court concludes that there are sufficient contacts to support general

21

jurisdiction, it must still consider the reasonableness of asserting jurisdiction. The test for

22

reasonableness is the same whether the court is considering general or specific personal jurisdiction:

23

(1) the extent of purposeful interjection, (2) the burden on the defendant to defend the suit in the

24

chosen forum, (3) the extent of conflict with the sovereignty of the defendant's state, (4) the forum

25

state's interest in the dispute, (5) the most efficient forum for judicial resolution of the dispute, (6)

26

the importance of the chosen forum to the plaintiff's interest in convenient and effective relief, and

27

(7) the existence of an alternative forum. Amoco Egypt Oil Co. v. Leonis Navigation Co., 1 F.3d

28

848, 851 (9th Cir. 1993).

10

1

Here, Watercraft has failed to make a compelling case that jurisdiction would be

2

unreasonable. It has interjected itself into California’s affairs through the volume and frequency of

3

its sales, purchases, contracts, and advertising in the state. And, given the amount of purchases and

4

sales Watercraft does with California consumers and businesses, California does have an interest in

5

this litigation. Watercraft argues that since all of its thirteen employees are located in Florida, it

6

would be unduly burdensome to make it defend suit here. However, the court has not been presented

7

with evidence that all or even most of Watercraft’s employees would be called as witnesses or

8

required to attend court proceedings here. Of course, West Marine will also have to call witnesses

9

from its staff, who are located in California, so if anything, this factor is a wash. In addition,

For the Northern District of California

United States District Court

10

Watercraft’s counsel is located in San Jose, and the parties have already evidenced a willingness to

11

conduct discovery in Florida when convenient (for instance, by deposing Pickren there), which

12

lessens Watercraft’s burden. Florida does offer an alternate forum for this action, but alone, the

13

presence of an alternate forum does not overcome reasonableness established by the other factors.

14

See Colt Studio, Inc. v. Badpuppy Enterprise, 75 F. Supp. 2d 1104, 1111 (C. D. Cal. 1999).

15
16

Accordingly, for the foregoing reasons, the court DENIES Watercraft’s motion to dismiss
and finds that general personal jurisdiction exists.

17

II.

MOTION TO TRANSFER TO THE MIDDLE DISTRICT OF FLORIDA

18

“For the convenience of parties and witnesses, in the interest of justice, a district court may

19

transfer any civil action to any other district or division where it might have been brought." 28

20

U.S.C. § 1404(a). The moving party bears the burden of showing that transfer is appropriate by

21

illustrating a “strong showing of inconvenience.” Decker Coal Co. v. Commonwealth Edison Co.,

22

805 F.2d 834, 843 (9th Cir. 1986). A district court nonetheless retains discretion to decide motions

23

to transfer venue based upon a case-by- case consideration of convenience and fairness. Jones v.

24

GNC Franchising, Inc., 211 F.3d 495, 498 (9th Cir. 2000) (quoting Stewart Org. v. Ricoh Corp., 487

25

U.S. 22, 29 (1988)). Transfer is appropriate only where (1) the transferee court is one where the

26

action might have been brought; and (2) the convenience of the parties and witnesses and the

27

interest of justice favor transfer. See 28 U.S.C. § 1404(a); see also Hatch v. Reliance Ins. Co., 758

28

F.2d 409, 414 (9th Cir. 1985).

11

1

There is no dispute that the instant action properly could have been filed in the Middle

2

District of Florida, where Watercraft is located. Accordingly, the decision to transfer depends upon

3

the convenience of the parties and witnesses and the interests of justice. In exercising its discretion,

4

the court must consider public factors, which pertain to the interests of justice, and private factors,

5

which concern the convenience of the parties and witnesses. Decker Coal Co., 805 F.2d at 843.

6

Among the factors to be considered are: (1) the location where the relevant agreements were

7

negotiated and executed; (2) the state that is most familiar with the governing law; (3) the plaintiff's

8

choice of forum; (4) the respective parties' contacts with the forum; (5) the contacts relating to the

9

plaintiff's claims for relief in the chosen forum; (6) the differences in the costs of litigation in the

For the Northern District of California

United States District Court

10

two forums; (7) the availability of compulsory process to compel attendance of unwilling non-party

11

witnesses; and (8) the ease of access to sources of proof. Jones, 211 F.3d at 498-99.

12

In this case, the factors tilt toward maintaining suit in this district. First, it is difficult to

13

identify a single “location” where the relevant contract was negotiated. Watercraft attempts to argue

14

that West Marine “reached into” Florida to initiate the contract negotiations, while West Marine

15

contends that all of its employees who participated in the negotiations are located in California. See

16

Motion to Dismiss at 8-9; Opposition at 18. In addition, Watercraft argues that the proposed contract

17

would have chosen Florida as the litigation venue. Motion to Dismiss at 9. However, since the

18

contract negotiation took place entirely or nearly entirely through phone calls and emails, the court

19

concludes that both California and Florida can be considered “locations” where the contract was

20

negotiated. This factor is neutral as between Florida and California, which weighs against transfer

21

away from the current venue.

22

The costs of litigation are speculative at this point, but are likely to be similar in either

23

forum. Watercraft argues that since all of its employees are in Florida, and because it is a smaller

24

company than West Marine, litigation in California will be unduly expensive. It contends that it

25

would be very costly to “set up a base of operations” in California. However, Watercraft has

26

retained counsel located in this district, so most court appearances will require no travel by

27

Watercraft employees. Moreover, there is no evidence that all or most of those employees will ever

28

be required to travel to California in connection with this action. Watercraft’s ability to

12

1

communicate with counsel via telephone, email, video conferencing, etc. will likely eliminate the

2

need to set up a physical “base” of any kind here. The parties have shown a willingness to conduct

3

some discovery in Florida, which lessens the burden on Watercraft. Finally, West Marine has stated

4

that its employees who participated in the contract negotiations are located in California, as is its

5

counsel. Opposition at 18. Thus, if the case is transferred, all of the costs Watercraft has noted will

6

be shifted to West Marine. It is true that Watercraft will have to incur some additional expense to

7

litigate in California, but it has not shown that this expense would be unduly burdensome or create a

8

severe hardship. As the parties and their respective witnesses are located in different states, some

9

expense will be required no matter where this case is located, but the overall cost of litigation does

For the Northern District of California

United States District Court

10

not appear to differ significantly between the two forums.

11

Next, West Marine has alleged causes of action under California law. While the federal

12

courts may be required to apply the laws of various states, it stands to reason that federal courts

13

located in California are likely to be more familiar with California law than federal courts located in

14

other states. In addition, West Marine has chosen California as its forum. As discussed in detail in

15

this order, Watercraft has a variety of contacts with California sufficient to establish general

16

jurisdiction in this court, and West Marine is headquartered in this district. West Marine has more

17

contacts in California than Watercraft, and Watercraft has more contacts in Florida than West

18

Marine, but both parties have substantial contacts in this district. These factors weigh in favor of

19

maintaining the action in this district.

20

As this case is in its early stages, and fact discovery has not begun, the availability of

21

compulsory process to compel attendance of non-party witnesses is unknown and may not be

22

relevant in this case. No party has identified a non-party witness, so this factor is neutral. Ease of

23

access to sources of proof will likely be similar in either forum. Both parties argue that relevant

24

witnesses are located in their preferred districts, and most non-witness evidence, such as emails and

25

proof of the contract negotiations, can be easily obtained irrespective of where this action is located,

26

so this factor is also neutral. Finally, Watercraft’s contacts with the forum state do not relate to

27

plaintiff’s claims for relief, which does weigh in favor of transfer.

28

13

1

On balance, the majority of the Jones factors weigh in favor of keeping this lawsuit in this

2

district, and only one of the factors truly weighs in favor of transfer. Watercraft has not satisfied its

3

burden of showing that transfer is appropriate in this case. Accordingly, the alternative motion to

4

transfer venue is DENIED.

5

III.

6

West Marine requests that the court take judicial notice of Watercraft’s store website,

7

REQUEST FOR JUDICIAL NOTICE

www.watercraftsuperstore.net.

8

Courts may take judicial notice of a fact not in the record only where the fact is ‘either (1)

9

generally known within the territorial jurisdiction of the trial court or (2) capable of accurate and

For the Northern District of California

United States District Court

10

ready determination by resort to sources whose accuracy cannot reasonably be questioned.’ Fed. R.

11

Evid. 201(b). Facts capable of ‘ready determination’ must be ‘widely available.’ 21 Charles Alan

12

Wright and Kenneth W. Graham, Jr., Federal Practice and Procedure § 5106, at 500 (1977). Courts

13

have taken notice of defendants’ websites or characteristics thereof when determining personal

14

jurisdiction. See Coremetrics, 370 F. Supp. 2d at 1021; Enter. Rent-A-Car Co. v. U-Haul Int'l, 327

15

F. Supp. 2d 1032, 1042 n. 4 (E.D. Mo. 2004); Publications Int'l v. Burke/Triolo, Inc., 121 F. Supp.

16

2d 1178 n. 2 (N.D. Ill. 2000).

17

Accordingly, good cause appearing, the court takes judicial notice of the website.

18

CONCLUSION

19

Based on the foregoing, IT IS ORDERED THAT:

20

1. Watercraft’s motion to dismiss for lack of personal jurisdiction is DENIED;

21

2. Watercraft’s motion to transfer venue is DENIED; and

22

3. West Marine’s request for judicial notice is GRANTED.

23
24

Dated: February 14, 2012
HOWARD R. LLOYD
UNITED STATES MAGISTRATE JUDGE

25
26
27
28

14

1

C11-04459 Notice will be electronically mailed to:

2

Ian Ballon
Lisa C. McCurdy
Benjamin Ross Lemke
David Harlan Fingerman
Kathryn G. Spelman
Lori Chang

3
4

[e-mail]
[e-mail]
[e-mail]
[e-mail]
[e-mail]
[e-mail]

5
6

Counsel are responsible for distributing copies of this document to co-counsel who have not
registered for e-filing under the court’s CM/ECF program.

7
8
9

For the Northern District of California

United States District Court

10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28

15