Twitch Interactive, Inc. v. Fishwoodco GmbH

Filing 55

ORDER DENYING 46 MOTION TO DISMISS; GRANTING REQUEST FOR JURISDICTIONAL DISCOVERY. Signed by Judge Edward J. Davila on 5/9/2024. (ejdlc1, COURT STAFF) (Filed on 5/9/2024)

1
2
3
4

UNITED STATES DISTRICT COURT

5

NORTHERN DISTRICT OF CALIFORNIA

6

SAN JOSE DIVISION

7
TWITCH INTERACTIVE, INC.,

8

Plaintiff,

9

ORDER DENYING MOTION TO
DISMISS WITHOUT
PREJUDICE; GRANTING
REQUEST FOR
JURISDICTIONAL DISCOVERY

v.

10

FISHWOODCO GMBH,

11
United States District Court
Northern District of California

Case No. 22-cv-03218-EJD

Defendant.

12

Re: ECF No. 46

13
Before the Court is Intervenors Loots Media GmbH, Fuehnen Holding GmbH, and Marc

14
15

Fuehnen’s (collectively, “Intervenors”) Motion to Dismiss (“Mot.” or “Motion”). ECF No. 46.

16

For the reasons set forth below, the Court DENIES Intervenors’ Motion without prejudice to

17

renew the Motion following the completion of limited jurisdictional discovery.

18

I.

19

BACKGROUND
Both Judge DeMarchi and this Court have previously provided detailed summaries of the

20

relevant facts, and the Court will summarize the facts relevant to Intervenors’ Motion here. See

21

ECF No. 36, Report and Recommendation re Mot. Default J. (“R&R”), at 2–8; see also ECF No.

22

45, Order on Intervention and Default Judgment.

23

A.

24

Twitch Interactive, Inc. (“Petitioner” or “Twitch”) is a San Francisco company that

25

provides streaming services for content creators. Petition to Confirm Arbitration Awards (“Pet.”

26

or “Petition”) ¶¶ 7–8, ECF No. 1. Twitch also owns rights in the TWITCH trademark and the

27

“Glitch Logo.” Id. ¶ 10. Respondent Fishwoodco GmbH is alleged to have operated an

28

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS

Parties

1

1

advertisement platform called Loots that enabled streamers to display advertisements on their

2

streams, with the revenue being shared between the streamers and Respondent, i.e., without any

3

revenue going to Twitch. Pet. ¶¶ 11–12. Respondent also allegedly used Twitch marks in its

4

materials that suggest the platform supports Twitch. Id. ¶ 12. In May 2016, Respondent signed up

5

for a Twitch user account and, therefore, agreed to Twitch’s terms of service (“TOS”), trademark

6

guidelines, and other policies incorporated into the TOS. Id. ¶ 13. In September 2018,

7

Respondent also purportedly entered into a Developer Services Agreement for a developer account

8

with Twitch. Id. ¶ 13. Around October 2019, Respondent filed for bankruptcy in Germany.

9

ECF No. 39-3, Decl. of Marc Fuehnen (“Fuehnen Decl.”) ¶ 11.

United States District Court
Northern District of California

10

Intervenor Marc Fuehnen was the former Geschäftsführer (equivalent to a Chief Executive

11

Officer) of Respondent until he was released from his duties by the bankruptcy administrator,

12

Sebastian Laboga. Fuehnen Decl. ¶¶ 2, 12.

13

Intervenor Loots Media GmbH (“Loots Media”) is a German company that Mr. Fuehnen

14

co-founded in January 2020 with four other shareholders. Id. ¶ 19. Although Loots Media

15

operates on a similar business model to Respondent’s, Loots Media does not permit Twitch users

16

to run branded content using Loots Media’s platform. Id. ¶ 21.

17
18

Intervenor Fuehnen Holding GmbH is a German asset management company whose sole
shareholder is Mr. Fuehnen. Fuehnen Decl. ¶ 4.

19

B.

20

In March 2017, Twitch sent cease-and-desist communications to Respondent, alleging

21

violations of Twitch’s TOS and infringement of Twitch’s intellectual property. Pet. ¶ 16. On

22

August 20, 2019, Twitch initiated JAMS arbitration proceedings in Santa Clara County, California

23

per the arbitration clause in Twitch’s TOS. Id. ¶ 17. Twitch asserted claims for Lanham Act

24

violations, breach of various contracts, and tortious interference with contractual relationships.

25

ECF No. 3-7.

26

JAMS Arbitration

Respondent initially participated in the arbitration via Marc Fuehnen, who engaged in

27

settlement negotiations with Twitch’s counsel. Fuehnen Decl. ¶¶ 10–11. Around October 2019,

28

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
2

1

Respondent filed for bankruptcy in Germany. Id. ¶ 11. Nonetheless, the settlement negotiations

2

continued and progressed to a point where the parties were to sign the settlement agreement in

3

December 2019. Id. ¶ 14. However, Mr. Fuehnen was purportedly discharged from his duties as

4

Respondent’s Geschäftsführer before the settlement agreement could be signed. Id. ¶¶ 14–15.

5

Mr. Fuehnen asserts that, after he was discharged, he could no longer represent the Respondent in

6

any official capacity. Id. ¶ 15. Instead, the “only individual with the authority to represent the

7

Respondent” following Mr. Fuehnen’s discharge “would have been Mr. Laboga.” Mot. 5.

8

United States District Court
Northern District of California

9

After Mr. Fuehnen and Respondent purportedly “fell silent,” Twitch moved for default
judgment in the JAMS arbitration in September 2020. Pet. ¶ 21. On January 4, 2021, the tribunal

10

granted default judgment, awarded $1,488,000 in damages, and issued an injunction against

11

Respondent and its “officers, agents, representatives, employees, and successors and assigns.”

12

Pet. ¶ 28.

13

In October 2021, Twitch requested that the JAMS tribunal issue an amended order that

14

also included Intervenors because Respondent was purportedly continuing its “operation of the

15

exact same scheme but under a slightly altered name.” Pet. ¶ 30. The tribunal granted the request

16

and amended the injunction to also include “Loots Media GmbH, Fuehnen Holding GmbH, Marc

17

Fuehnen, and the operators of its websites like loots.com and new.loots.com.” Id. ¶ 31.

18

Mr. Fuehnen was purportedly served with the amended award by email on March 1, 2022.

19

Opp. 15.

20

C.

21

After initial unsuccessful service attempts via the Hague Service Convention, Twitch

Procedural History

22

served Respondent via email to Mr. Fuehnen. ECF No. 18. Respondent Fishwoodco GmbH did

23

not appear in this action, resulting in an entry of default and Judge DeMarchi’s issuance of a

24

Report and Recommendation for Default Judgment. See Entry of Default, ECF No. 20; R&R.

25

Mr. Fuehnen, however, reached out to Twitch’s counsel, JAMS, and Judge DeMarchi’s staff

26

regarding the Petition on behalf of Proposed Intervenors. See R&R 6–7.

27
28

The Proposed Intervenors filed a request for leave to file a brief as amici curiae and
Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
3

United States District Court
Northern District of California

1

appeared at the May 30, 2023, hearing on Twitch’s motion for default judgment. ECF Nos. 23,

2

35. On May 31, 2023, Judge DeMarchi issued an Order for Reassignment to a District Judge with

3

a Report and Recommendation to grant default judgment and deny the amicus filing. ECF No. 36.

4

On August 29, 2023, the Intervenors filed a motion to intervene to file a motion to dismiss

5

themselves for lack of personal jurisdiction. ECF No. 39. The Court granted the motion to

6

intervene and accepted the Intervenors’ instant motion to dismiss. ECF No. 45.

7

On December 7, 2023, Twitch filed an opposition to the motion to dismiss, and on

8

December 21, 2023, Intervenors replied. ECF No. 49, Twitch’s Opposition to Motion to Dismiss

9

(“Opp.”); ECF No. 50, Intervenors’ Reply in Support of Motion to Dismiss (“Reply”). The Court

10

heard oral argument on the Motion on February 22, 2024.

11

II.

LEGAL STANDARD

12

The parties dispute the relevant legal standard. Intervenors argue that the FAA provides

13

the exclusive grounds for vacating an award issued in the United States. Mot. 7. Twitch argues

14

that the New York Convention governs confirmation of foreign arbitration awards like this one.

15

Opp. 6. The Ninth Circuit has held that “neither the Convention nor its implementing legislation

16

removed the district courts’ obligation to find jurisdiction over the defendant in suits to confirm

17

arbitration awards.” Glencore Grain Rotterdam B.V. v. Shivnath Rai Harnarain Co., 284 F.3d

18

1114, 1121 (9th Cir. 2002) (“Interpreting the FAA to dispense with the jurisdictional requirements

19

of Due Process in actions to confirm arbitral awards would raise clear questions concerning the

20

constitutionality of the statutes”).

21

On a motion to dismiss a complaint for lack of personal jurisdiction, the plaintiff bears the

22

burden of establishing personal jurisdiction. Farmers Ins. Exch. v. Portage La Prairie Mut. Ins.

23

Co., 907 F.2d 911, 912 (9th Cir. 1990). Where the motion to dismiss is based on written

24

materials, rather than an evidentiary hearing, the plaintiff need only make a prima facie showing

25

of jurisdictional facts to satisfy their burden. Dole Food Co. v. Watts, 303 F.3d 1104, 1108 (9th

26

Cir. 2002). While the plaintiff cannot “simply rest on the bare allegations of its complaint,”

27

uncontroverted allegations in the complaint must be taken as true. Amba Mktg. Sys., Inc. v. Jobar

28

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
4

United States District Court
Northern District of California

1

Int’l, Inc., 551 F.2d 784, 787 (9th Cir. 1977); AT&T Co. v. Compagnie Bruxelles Lambert, 94 F.3d

2

586, 588 (9th Cir. 1996). Conflicts between parties over statements contained in affidavits must

3

be resolved in the plaintiff’s favor. Id. If a plaintiff’s proof is “limited to written materials,” the

4

materials must only contain facts that “support a finding of jurisdiction.” Data Disc, Inc. v. Sys.

5

Tech. Assocs., Inc., 557 F.2d 1280, 1285 (9th Cir. 1977).

6

The exercise of personal jurisdiction over a nonresident defendant must be authorized

7

under the state’s long-arm statute and must satisfy the due process clause of the United States

8

Constitution. Perez v. United States, 103 F. Supp. 3d 1180, 1197 (S.D. Cal. 2015). California’s

9

long-arm statute permits the exercise of personal jurisdiction “on any basis not inconsistent with

10

the Constitution of this state or the United States.” Cal. Code Civ. Proc. § 410.10. Under the due

11

process analysis, a defendant may be subject to either general or specific personal jurisdiction.

12

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

13

III.

DISCUSSION

14

Intervenors move to dismiss Twitch’s efforts to enforce the arbitration award on the

15

grounds that this Court lacks personal jurisdiction over Intervenors. Mot. 1. On reply, Intervenors

16

contend that the award against Intervenors should be vacated under 9 U.S.C. § 10(a)(4), which

17

permits vacatur “[w]here the arbitrators exceeded their powers, or so imperfectly executed them

18

that a mutual, final, and definite award upon the subject matter submitted was not made.”

19

Reply 7.

20

Twitch contends that Intervenors’ Motion should be denied because (1) the Court has

21

authority under Rule 65 to confirm the awards as to the Intervenors regardless of any jurisdictional

22

issue, and (2) irrespective of this Court’s authority under Rule 65, it has specific personal

23

jurisdiction over Intervenors. Opp. 1. In the alternative, Twitch requests an opportunity to

24

conduct limited discovery on the issue of personal jurisdiction. Id. at 2.

25

A.

26

Twitch contends that this Court has authority to confirm the arbitration awards as to

27

Intervenors regardless of any jurisdictional issues pursuant to Rule 65(d)(2) because the Arbitrator

28

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS

Federal Rule of Civil Procedure 65(d)

5

1

“determined that the Loots Intervenors were in active concert or participation with Loots, the

2

original defendant.” Opp. 7. Rule 65 provides that “persons bound” by an injunction may include

3

not only “parties,” but their “officers, agents, servants, employees, and attorneys,” as well as

4

“other persons who are in active concert or participation” with them, so long as that person

5

receives “actual notice of [the injunction] by personal service or otherwise.” Fed. R. Civ. P.

6

65(d)(2).

7
8

United States District Court
Northern District of California

9

1.

Whether Rule 65 Applies to Arbitration-Issued Injunctions

Intervenors argue that Rule 65 applies to court-issued injunctions rather than arbitratorissued injunctions, and therefore does not apply to the instant action. Reply 10. The parties have

10

not presented cases applying Rule 65(d)(2) in an arbitration context. Although not discussed

11

directly, in Int’l Petroleum Prod. & Additives Co., Inc. v. Black Gold, S.A.R.L., 418 F. Supp. 3d

12

481, 484 (N.D. Cal. 2019), the court confirmed an arbitration award and found that the arbitrator

13

did not exceed his powers where the awarded injunction was “limited to a set of persons and

14

entities who might act on behalf of [petitioner], namely, ‘any and all persons acting in concert with

15

[petitioner] or in participation with it or in support of it or in combination with it or in collusion

16

with it or in conspiracy with it, whether as aiders, abettors, co-conspirators, agents, servants,

17

employees or otherwise....” Id. at 492, n. 12 (citing award). In so finding, the court cited Rule

18

65(d)(2), implicitly approving the application of the Rule to an arbitration award. Id.

19
20

2.

Whether Intervenors Received Actual Notice

Assuming Rule 65 extends to arbitration-issued injunctions, the Rule also requires that

21

Intervenors received “actual notice” of the injunction against them. Fed. R. Civ. P. 65(d)(2).

22

Twitch argues that Mr. Fuehnen’s (1) admission that he participated in the proceedings on behalf

23

of Respondents for “multiple months before going silent,” and (2) acknowledged receipt of the

24

Final Award demonstrate Intervenors did receive actual notice of the injunction. Opp. 7.

25

In Optronic Techs., Inc. v. Ningbo Sunny Elec. Co., plaintiff brought a motion for civil

26

contempt against several non-parties. No. 16-cv-06370-EJD, 2020 WL 3617907, at *5 (N.D. Cal.

27

July 2, 2020). This Court found that one foreign defendant received actual notice to satisfy

28

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
6

1

Rule 65(d) where the party received the motion “despite the fact that he was not served.” Id. at *4,

2

5. This Court explained that “[t]he ‘or otherwise’ at the end of Rule 65(d) makes clear that

3

personal service is not required to bind non-party officers of a corporation to a court order, as long

4

as the non-party has ‘actual notice’ of the order.” Id. at *5 (citing Fed R. Civ. P. 65(d)).

United States District Court
Northern District of California

5

This is consistent with the findings of several other district courts, which concluded that an

6

injunction (albeit, a court-issued injunction, not an arbitration-issued injunction) can apply to

7

non-parties who have received notice of the order. See, e.g., AirWair Int’l Ltd. v. ITX USA LLC,

8

No. 19-CV-07641-SI, 2021 WL 5302922, at *7 (N.D. Cal. Nov. 15, 2021) (finding injunction

9

would be enforceable against non-party who was previously dismissed based on a lack of personal

10

jurisdiction “to the extent that they have notice and are legally identified with, or aiding and

11

abetting, defendant”); Al Otro Lado v. Wolf, 497 F. Supp. 3d 914, 929 (S.D. Cal. 2020) (finding

12

non-parties bound by injunction after finding non-party was “in active concert or participation”

13

with defendants); Netlist Inc v. Diablo Techs. Inc., No. 13-CV-05962-YGR, 2015 WL 163434, at

14

*1 (N.D. Cal. Jan. 12, 2015) (clarifying that non-parties “not specifically named in the injunction”

15

but otherwise “in active concert or participation with [defendant]” would be bound by injunction).

16

Here, the Arbitrator issued a permanent injunction against “Respondent and its officers,

17

agents, representatives, employees, and successors and assigns, including but not limited to Loots

18

Media GmbH, Fuehnen Holding GmbH, Marc Fuehnen, and the operators of its websites like

19

loots.com and new.loots.com (or any other name or website incorporating Loots or that is

20

confusingly similar to Loots.” ECF No. 3-7, Amended Order Granting Default Judgment Against

21

Respondent (“DJ Order”) 8. Thereafter, Twitch served the Final Award on Mr. Fuehnen on March

22

1, 2022 (ECF No. 16-2) and served the Petition to Confirm on November 17, 2022 (ECF No. 18).

23

This is sufficient to demonstrate “actual notice” of the Arbitrator’s injunction. BYD Co. Ltd v.

24

Khazai, No. 20-CV-5530-DMG-AGRX, 2020 WL 3893310, at *1 (C.D. Cal. July 10, 2020)

25

(finding actual notice occurred where plaintiffs emailed the TRO, and non-party replied to

26

plaintiffs’ email).

27
28

Nevertheless, the Court is not inclined to find that Rule 65(d), a rule governing the Federal
Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
7

United States District Court
Northern District of California

1

Rules of Civil Procedure, extends to an arbitrator-issued injunction such that the Court can bypass

2

a jurisdictional analysis. Accordingly, the Court will proceed to evaluate whether Intervenors are

3

subject to this Court’s personal jurisdiction.

4

B.

5

Intervenors argue that this Court lacks both general and specific jurisdiction against them

General and Specific Jurisdiction

6

and on that basis, Intervenors “move to dismiss the arbitration award insofar as it relates to the

7

injunctive relief applied against them.” Mot. 11–12. Twitch disputes only this Court’s exercise of

8

specific personal jurisdiction over Intervenors. Opp. 10.

9

The Ninth Circuit and district courts in this Circuit evaluate personal jurisdiction in the

10

context of a motion to confirm an arbitration award. In Kirby Morgan Dive Systems, the Ninth

11

Circuit remanded an order confirming an arbitration award where the district court lacked

12

jurisdiction “under the traditional minimum contacts framework” because the petitioner “presented

13

no evidence that [respondent]” purposefully availed himself of the privilege of conducting

14

activities in the forum” or “purposefully directed his activities toward the forum.” Kirby Morgan

15

Dive Sys., Inc. v. Hydrospace, Ltd., 478 F. App’x 382, 383 (9th Cir. 2012) (finding “the district

16

court’s exercise of personal jurisdiction over [respondent] violated due process”); see also

17

Glencore Grain Rotterdam B.V. v. Shivnath Rai Harnarain Co., 284 F.3d 1114, 1121 (9th Cir.

18

2002) (“Interpreting the FAA to dispense with the jurisdictional requirements of Due Process in

19

actions to confirm arbitral awards would raise clear questions concerning the constitutionality of

20

the statutes”).

21

Hellmich, relying on Kirby, found personal jurisdiction over respondents where petitioner

22

“met his burden of proving that the [respondents] have such a unity of interest that treating them

23

as separate entities for personal jurisdiction purposes in this case would be unjust.” Hellmich v.

24

Mastiff Contracting, LLC, No. 14-CV-1354 DOCANX, 2015 WL 391989, at *8 (C.D. Cal. Jan.

25

27, 2015) (“To confirm an arbitral award, a petitioner must establish that a non-resident

26

respondent has consented to personal jurisdiction in the forum or that the respondent otherwise has

27

sufficient contacts with the forum such that exercising jurisdiction over him or her does not offend

28

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
8

1

United States District Court
Northern District of California

2

traditional notions of fair play and substantial justice”) (quotations omitted).
In another unpublished opinion, the Ninth Circuit in Greenfield Advisors affirmed the

3

district court’s confirmation of an arbitration award and entry of judgment against defendants after

4

finding that the district court had personal jurisdiction over the defendants. Greenfield Advisors

5

LLC v. Salas, 733 F. App’x 364, 366 (9th Cir. 2018). After evaluating the defendants’ contacts

6

with the forum state, the Ninth Circuit concluded that the defendants had “not met their burden of

7

setting forth a compelling case that the exercise of jurisdiction would not be reasonable.” Id. at

8

367 (quotations omitted) (citing CollegeSource, Inc. v. AcademyOne, Inc., 653 F.3d 1066, 1076

9

(9th Cir. 2011)); see also Goodwin Procter, LLP v. Gibson, No. 12-CV-02167 NC, 2012 WL

10

12921028, at *6 (N.D. Cal. July 23, 2012) (dismissing petition for confirmation of an arbitration

11

award where court lacked personal jurisdiction over defendants).

12

Consistent with the decisions above, the Court will evaluate whether personal jurisdiction

13

over Intervenors exists such that confirming an arbitration award against Intervenors would not

14

violate due process. When determining whether to exercise specific jurisdiction, courts apply a

15

three-part test: (1) the nonresident defendant must do some act or consummate some transaction

16

with the forum or perform some act by which he purposefully avails himself of the privilege of

17

conducting activities in the forum, thereby invoking the benefits and protections of its laws; (2)

18

the claim must be one which arises out of or results from the defendant’s forum-related activities;

19

and (3) exercise of jurisdiction must be reasonable. Panavision Int’l, L.P. v. Toeppen, 141 F.3d

20

1316, 1320 (9th Cir. 1998), holding modified by Yahoo! Inc. v. La Ligue Contre Le Racisme Et

21

L’Antisemitisme, 433 F.3d 1199 (9th Cir. 2006). The plaintiff bears the burden of satisfying the

22

first two of these three elements; if the plaintiff fails to establish either of them, specific personal

23

jurisdiction over the nonresident defendant is improper. Goodwin Procter, 2012 WL 12921028, at

24

*4 (citing Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 802 (9th Cir. 2004)). If the

25

plaintiff satisfies the first two elements, the burden then shifts to the defendant to “present a

26

compelling case” that the exercise of jurisdiction would not be reasonable. Id. (citations omitted).

27
28

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
9

1.

1

Purposeful Availment in California

A purposeful availment analysis, as opposed to a purposeful direction analysis, is most
2
often used in suits sounding in contract. Schwarzenegger, 374 F.3d at 802. A showing that a
3
defendant purposefully availed himself of the privilege of doing business in a forum state typically
4
5

consists of evidence of the defendant’s actions in the forum, such as executing or performing a
contract there. Id. By taking such actions, a defendant “purposefully avails itself of the privilege

6
of conducting activities within the forum State, thus invoking the benefits and protections of its
7

laws.” Id. (citations omitted).

8
Intervenors argue that they have not purposefully availed themselves of conducting
9
10

United States District Court
Northern District of California

11

activities in California because they “never had and do not have any dealing with Petitioner.”
Mot. 12. Intervenors contend they “did not contemplate a relationship, enter into a contract, or
agree to arbitration.” Id. Even if Intervenors were bound by the arbitration agreement,

12
Intervenors argue that this would nevertheless be insufficient to establish jurisdiction because
13
14

“even an explicit agreement to arbitrate does not constitute consent to personal jurisdiction in the
Northern District of California.” Mot. 13 (citing Foster v. Device Partners Infl LLC, No. C 12-

15
02279-DMR, 2012 WL 6115618, at *2 (N.D. Cal. Nov. 21, 2012)).
16

Twitch counters that it has “uncovered” evidence that demonstrates Intervenors have ties to

17
California, including evidence that (1) Loots formed a domestic corporation––Fishwoodco Inc.––
18
in 2018 (prior to the arbitration proceedings) with a business address in Torrance, California
19

naming Mr. Fuehnen as the CEO; (2) Intervenors’ website show ties to California, including

20
statements that they partner with companies based in or operating out of California and graphics
21

showing thousands of active users in the United States; and (3) Intervenors’ privacy policy states

22
that the company processes payments via corporations based in California. Opp. 15–18 (citing
23
Oomph Innovations LLC v. Shenzhen Bolsesic Elecs. Co., No. 18-CV-05561-EJD, 2020 WL
24
5847505, at *2 (N.D. Cal. Sept. 30, 2020) (exercising personal jurisdiction over defendants that
25
26

“sold products to residents of California, including Plaintiff, through interactive Internet
websites”)).

27
28

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
10

Regarding the business address in Torrance, California, Intervenors argue that

1
2

Mr. Fuehnen was “unaware of the filing” and because the venture “never became operational,” the

3

Intervenors “never benefitted or profited from” California––the state in which it was formed.

4

Reply 15–16. Intervenors also dispute Twitch’s evidence regarding Intervenor’s website. The

5

websites, Intervenors argue, “merely provide general information on the platform.” Reply 15.

6

Intervenors also contend that Twitch misinterprets the graphics on the website; the “2,000 monthly

7

active users” figure purportedly refers to Canada, not California––as Twitch contends. Id. at 15–

8

16.

United States District Court
Northern District of California

9

Intervenors are German citizens or Germany entities with an apparent overlap with

10

Respondents. Reply 5. For example, online records relating to the registration of New.Loots

11

showed that it was apparently being operated through Loots’ CEO, co-founder and representative,

12

Loots Intervenor Fuehnen, with the new website (new.loots.com) being hosted at the exact same

13

URL as the old one (www.loots.com), except that the previous prefix (www.) was replaced with

14

(new.) attached to the same domain (loots.com). See Opp. 4, ECF No. 49-1, Declaration of Diana

15

Palacios (“Palacios Decl.”) ¶ 18. Mr. Fuehnen, the former CEO of Respondent Fishwood GmbH,

16

states that “there is simply no legal or commercial nexus between the companies.” Fuehnen Decl.

17

¶ 19. Mr. Fuehnen also contends that “[n]one of [his] business dealings, or the dealings of Loots

18

Media GmbH or Fuehnen Holding GmbH, involve or have dealt with California.” Id. ¶ 23. In

19

sum, Mr. Fuehnen claims no connection with the state. Id.

20

The Court recognizes that, despite Mr. Fuehnen’s statements disclaiming any connection to

21

California, Twitch has presented some evidence demonstrating ties to this jurisdiction, including

22

evidence regarding Intervenors’ websites and a public business record showing Mr. Fuehnen’s

23

name associated with a business incorporated in California. See Opp. 15–16. On the record

24

before it, the Court is unable to conclude that Intervenors purposefully availed themselves of the

25

privilege of doing business in California such that the Court may establish personal jurisdiction

26

over them. At the same time, the Court is not convinced that Intervenors can necessarily avoid

27

personal jurisdiction in California given the evidence presented thus far. Under these

28

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
11

1

circumstances, where “pertinent facts bearing on the question of jurisdiction are controverted” and

2

“where a more satisfactory showing of the facts is necessary,” the Court finds limited

3

jurisdictional discovery is appropriate. Boschetto v. Hansing, 539 F.3d 1011, 1020 (9th Cir.

4

2008). Jurisdictional discovery should be granted where “discovery on th[e] issue might well

5

demonstrate facts sufficient to constitute a basis for jurisdiction.” Payrovi v. LG Chem Am., Inc.,

6

491 F. Supp. 3d 597, 608 (N.D. Cal. 2020) (citing Harris Rutsky & Co. Ins. Servs. v. Bell &

7

Clements Ltd., 328 F.3d 1122, 1135 (9th Cir. 2003)).

8

United States District Court
Northern District of California

9

Accordingly, this Court finds that limited jurisdictional discovery is warranted, and Twitch
is allowed discovery on the extent and nature of Intervenors’ contacts with California. Such

10

discovery may include (1) information relating to Intervenors’ use of Twitch and/or other

11

streaming entities they place advertisements on based in or with ties to California; (2) information

12

relating to its contractual partners located in California, including the apparent 35 plus entities

13

listed as partners on Intervenors’ websites; (3) information relating to users in California;

14

(4) information relating to the migration from loots.com to new.loots.com, and recently, from

15

new.loots.com back to loots.com; and (5) information relating to the Intervenors’ disclosure of

16

user information in California and financial transactions through institutions located in California.

17
18

2.

Whether the Claims Arise Out of Forum-Related Activity

The second requirement for specific, personal jurisdiction considers whether the claim

19

asserted in the litigation arises out of the defendant’s forum related activities. The Court “must

20

determine if [Twitch] would not have been injured ‘but for’ the [Intervenors’] conduct directed

21

toward [Twitch] in California.” Panavision, 141 F.3d at 1322 (9th Cir. 1998).

22

Intervenors argue that the second requirement for personal jurisdiction fails because

23

Twitch’s enforcement of the arbitration award arising from Respondents’ breach of contract is

24

unrelated to Intervenors. Mot. 15. In attempting to demonstrate this lack of connection,

25

Intervenors contend that since Mr. Fuehnen was terminated as managing director of Respondent in

26

December 2019, he “no longer had any affiliation with Respondent.” Mot. 15.

27
28

Twitch counters that “the basis of these confirmation proceedings is the Arbitration in this
Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
12

1

District––proceedings that Mr. Fuehnen participated in.” Opp. 19. Additionally, Twitch argues

2

that the Arbitrator determined the Loots brand, which Mr. Fuehnen owns, “used Twitch’s services

3

and intellectual property . . . just as had been done under the company’s original name.” Opp. 19.

4

The Court finds that the claims here appear to arise out of forum-related activity.

5

Mr. Fuehnen participated, at least initially, in the arbitration before falling silent. See DJ Order 1.

6

The arbitration forms the basis of these confirmation proceedings in this District. Additionally,

7

Twitch presented evidence that the Intervenors “appear to have migrated from new.loots.com back

8

to loots.com, the same websites operated by Loots.” Mot. 19. However, the Court will reserve

9

ruling on this factor following the conclusion of jurisdictional discovery, which may further

10

inform the Court’s analysis regarding this factor.

United States District Court
Northern District of California

11

3.

12

Whether Exercising Personal Jurisdiction Over Intervenors Would Be
Reasonable

The final requirement for specific jurisdiction is reasonableness. For jurisdiction to be
13
reasonable, it must comport with fair play and substantial justice. Bancroft & Masters, Inc. v.
14
Augusta Nat. Inc., 223 F.3d 1082, 1088 (9th Cir. 2000), holding modified by Yahoo!, 433 F.3d
15
1199. Intervenors have the burden to demonstrate unreasonableness and are required to put on a
16
17

“compelling case.” Id. The reasonableness determination requires the consideration of several
specific factors: (1) the extent of Intervenors’ purposeful interjection into the forum state, (2) the

18
burden on the Intervenors in defending in the forum, (3) the extent of the conflict with the
19

sovereignty of the Intervenors’ state, (4) the forum state’s interest in adjudicating the dispute,

20
(5) the most efficient judicial resolution of the controversy, (6) the importance of the forum to the
21
Petitioner’s interest in convenience and effective relief, and (7) the existence of an alternative
22
forum. Id.
23
In their opening brief, Intervenors failed to meet their burden to demonstrate
24
unreasonableness, having simply argued that exercising jurisdiction over them would be
25

unreasonable because “[b]y never agreeing to arbitration in Santa Clara County, California, or

26
otherwise availing itself of California or United States law, Intervenors never indicated a
27
28

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
13

1

willingness to defend its legal interests in a forum in California.” Mot. 16. On reply, Intervenors

2

contend that, as residents of Germany and not native English speakers, it would be burdensome to

3

defend themselves in California, and “Germany has a strong sovereign interest in regulating its

4

laws.” Reply 17.

5

Twitch argues that California has a strong interest in confirming the valid result of an

6

arbitration litigated in this District and deterring others from participating in similar unlawful

7

schemes. Opp. 20–21.

8
9
10

United States District Court
Northern District of California

11
12
13
14

The Court will reserve ruling on this factor––which involves considering the extent of the
Intervenors’ purposeful interjection into the forum state––following the conclusion of
jurisdictional discovery.
4.

Other Bases to Find Personal Jurisdiction

The Court is unpersuaded by Twitch’s remaining arguments to support exercising personal
jurisdiction over Intervenors.
Consent. First, Twitch contends that because Intervenors challenge a portion of the

15

Arbitrator’s Final Award, and because Twitch’s Terms of Service (“TOS”) state that federal and

16

state courts in California “have exclusive jurisdiction over any appeals of an arbitration award,”

17

Mr. Fuehnen consented to jurisdiction by participating in the Arbitration. Opp. 10. Intervenors

18

respond that they neither agreed to arbitrate nor bound themselves to the TOS. Reply 13.

19

In Voltage Pictures, LLC v. Gussi, S.A. De C.V., the court found that an international

20

respondent challenging an arbitration award “waived its ability to raise personal jurisdiction as a

21

defense in [the] action” because the party “agreed to submit to the jurisdiction of courts in the

22

Forum . . . to confirm an arbitration award.” No. 21-CV-04751, 2022 WL 18397529, at *3 (C.D.

23

Cal. Mar. 28, 2022), aff’d but criticized, No. 23-55123, 2024 WL 413497 (9th Cir. Feb. 5, 2024).

24

On appeal, the Ninth Circuit affirmed this holding and rejected respondent’s objection to the

25

district court’s exercise of personal jurisdiction over it. Because “it [was] undisputed that

26

[respondent] by entering into the [arbitration agreement], consented and submitted to the district

27

court exercising personal jurisdiction over it,” the Ninth Circuit explained that the “only basis for

28

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
14

1

[respondent] to contest the district court’s exercise of personal jurisdiction over it would be

2

insufficient service of [petitioner’s] notice of motion to confirm the arbitral award.” Voltage

3

Pictures, 2024 WL 413497, at *5 (cleaned up). The court ultimately affirmed because it found

4

that service of the motion was sufficient on respondent. Id. at *12.

United States District Court
Northern District of California

5

Here, unlike the party challenging jurisdiction in Voltage, Intervenors strongly dispute that

6

it signed the arbitration agreement and participated in the arbitration. Reply 10. Although

7

Mr. Fuehnen appears to have signed the arbitration agreement on behalf of Respondents, the other

8

Intervenors did not. Moreover, Intervenors argue that, as third parties, they “never had the right to

9

respond” and were prevented from participating in the arbitration at all. Id. at 10–11. This case is

10

therefore unlike Voltage Pictures. Without a more fully developed record as to Intervenors’ ties to

11

California, the Court cannot determine that Mr. Fuehnen’s agreement to arbitrate on behalf of

12

Respondents is sufficient to constitute consent to personal jurisdiction as to Intervenors. See

13

Foster v. Device Partners Int’l LLC, 2012 WL 6115618 (N.D. Cal. Nov. 21, 2012)

14

(recommending dismissal for lack of personal jurisdiction despite defendant’s signature on

15

arbitration agreement with “clause requiring the parties to arbitrate disputes in San Francisco”).

16

Aiding and abetting. Twitch next argues the Court can exercise personal jurisdiction over

17

Intervenors because the Arbitrator determined that the Intervenors aided and abetted Loots.

18

Opp. 11. Because Loots signed the arbitration agreement, which subjects Loots to this Court’s

19

jurisdiction, Twitch contends that the Court has authority to extend jurisdiction to Intervenors

20

because the Arbitrator determined Intervenors “carried out Loots’ scheme.” Id.; see Reebok Int’l

21

Ltd. v. McLaughlin, 49 F.3d 1387, 1392 (9th Cir. 1995) (personal jurisdiction over non-party who

22

assisted violation of an injunction “may be sound, even necessary”).

23

Intervenors explain that the Reebok reasoning does not apply to it because Intervenors are

24

non-domestic, and Reebok expressed doubt when “a district court seeks to reach out across the

25

Atlantic in an attempt to impose conflicting duties on another country’s nationals within its own

26

borders.” Reebok, 49 F.3d at 1392. The Court agrees and declines to find personal jurisdiction

27

over Intervenors, German residents and entities, based on Reebok without a more fully developed

28

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
15

1

record as to Intervenors’ ties to California.

2

IV.

3

CONCLUSION
Twitch’s request for limited jurisdictional discovery is GRANTED as described above.

4

Intervenors’ motion to dismiss is DENIED without prejudice to renew the motion after Twitch has

5

had a full and fair opportunity to complete jurisdictional discovery consistent with this order. Any

6

disputes regarding the scope of jurisdictional discovery are referred to the magistrate judge.

7
8

IT IS SO ORDERED.

9
10

Dated: May 9, 2024

United States District Court
Northern District of California

11
12
EDWARD J. DAVILA
United States District Judge

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

Case No.: 22-cv-03218-EJD
ORDER DENYING MOTION TO DISMISS
16