Solaright Lighting LLC v. Lux Solar Inc et al
ORDER granting defendant's 19 motion to dismiss; this case is dismissed without prejudice for lack of personal jurisdiction over the defendants; judgment will enter accordingly...see order for specifics. Signed by Honorable Joe Heaton on 1/12/2017. (cla)
IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF OKLAHOMA
SOLARIGHT LIGHTING, LLC,
an Oklahoma limited liability company,
LUX SOLAR, INC. a Florida corporation;
and WAEL MAJDALAWI, an individual
Plaintiff Solaright Lighting, LLC (“SolaRight”) filed this action against defendants
Lux Solar, Inc. (“Lux”) and Wael Majdalawi, asserting trademark infringement and
similar claims under federal and state law. Defendants moved to dismiss the complaint
for lack of personal jurisdiction or, alternatively, for transfer of the case to a federal
district court in Florida [Doc. #19]. The court held an evidentiary hearing on the motion
on January 5, 2017. Having considered the parties’ submissions at the hearing and
otherwise, the court concludes plaintiff has not established a basis for personal
jurisdiction over the defendants in this court.
The complaint alleges that SolaRight is the exclusive owner, manufacturer, and
distributor of SolaRight solar lighting products. At some point, SolaRight and Lux
discussed a potential distributorship relationship between the two companies. On March
3, 2015, Majdalawi and other Lux executives traveled to Oklahoma City, Oklahoma, at
plaintiff’s invitation, to meet with SolaRight executives about the possible business
relationship. Although the parties discussed the matter for a period of time, they did not
ultimately reach an agreement.
SolaRight then demanded that Lux no longer sell
SolaRight products or use its trademarks in connection with the sale of solar lighting
products. Defendants continued to sell certain SolaRight products, relying at least in part
on an earlier agreement defendants had with SolaRight’s predecessor.
SolaRight alleges that Lux offers the allegedly infringing products through the
Lux website, using specifications and images taken from SolaRight’s website. SolaRight
asserts that defendants have directed their activities into Oklahoma through their various
dealings with plaintiff and by seeking to sell the products to a customer in Oklahoma,
specifically the Oklahoma Department of Transportation (“ODOT”).
Defendants assert this court lacks in personam jurisdiction over them. Whether
personal jurisdiction exists in a federal question case involves two questions: “(1)
whether the applicable statute potentially confers jurisdiction by authorizing service of
process on the defendant and (2) whether the exercise of jurisdiction comports with due
process.’” Klein v. Cornelius, 786 F.3d 1310, 1317 (10th Cir. 2015) (quoting Peay v.
BellSouth Med. Assistance Plan, 205 F.3d 1206, 1209 (10th Cir. 2000)). Because the
Lanham Act, which plaintiff cites as the basis for its federal claims, does not authorize
nationwide service, Fed.R.Civ.P. 4(k)(1)(A) refers the court to Oklahoma’s long-arm
statute, which is co-extensive with the limits of the Due Process Clause. Trujillo v.
Williams, 465 F.3d 1210, 1217 (10th Cir. 2006); 12 OKLA. STAT. § 2004(F). Due
process is not offended by the exercise of jurisdiction over a nonresident defendant so
long as that defendant has “‘minimum contacts’ with the forum state, such that having to
defend a lawsuit there would not ‘offend traditional notions of fair play and substantial
justice.’” Dudnikov v. Chalk & Vermilion Fine Arts, Inc., 514 F.3d 1063, 1070 (10th
Cir.2008) (quoting Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)).
Whether a nonresident individual or company has the necessary minimum contacts
with the forum state is decided on the particular facts of each case and plaintiff has the
burden of establishing personal jurisdiction. Id. at 1069. When jurisdictional facts are
disputed, the plaintiff must prove those facts by a preponderance of the evidence. Dennis
Garberg & Associates, Inc. v. Pack-Tech Intern. Corp., 115 F.3d 767, 773 (10th Cir.
1997); see also Dudnikov, 514 F.3d at 1070 n.4 (“when personal jurisdiction is assessed
in an evidentiary hearing . . . the plaintiff must generally establish, by a preponderance of
the evidence, that personal jurisdiction exists”).
A court may exercise either general or specific jurisdiction over a defendant.
“General jurisdiction is based on an out-of-state defendant’s ‘continuous and systematic’
contacts with the forum state, and does not require that the claim be related to those
contacts.” Dudnikov, 514 F.3d at 1078. (internal citation and quotations marks omitted).
Specific jurisdiction depends “on the relationship among the defendant, the forum, and
the litigation.” Walden v. Fiore, 134 S. Ct. 1115, 1121 (2014). Here, SolaRight does not
assert that general jurisdiction exists, but relies instead on specific jurisdiction.
Because a trademark infringement claim is in the nature of a tort claim, the court
must “consider ‘whether the nonresident defendant “purposefully directed” its activities
at the forum state.’” Anzures v. Flagship Rest. Grp., 819 F.3d 1277, 1280 (10th Cir.
2016) (quoting Dudnikov, 514 F.3d at 1071). “[P]urposeful direction exists when there
is ‘an intentional action . . . expressly aimed at the forum state . . . with [the] knowledge
that the brunt of the injury would be felt in the forum state.’” Id. (quoting Dudnikov, 514
F.3d at 1072). A plaintiff’s injuries also must “‘arise out of’ [the] defendant’s forumrelated activities.” Dudnikov, 514 F.3d at 1071 (quoting Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 472(1985)). “For a State to exercise jurisdiction consistent
with due process, the defendant’s suit-related conduct must create a substantial
connection with the forum State.” Walden, 134 S. Ct. at 1121 (emphasis in original).
SolaRight relies on five facts or circumstances as the basis for its claim that the
necessary minimum contacts exist between defendants and Oklahoma:
defendants knew that SolaRight was an Oklahoma company, (2) that Lux executives,
including Majdalawi, traveled to Oklahoma to meet with SolaRight executives, (3) that
the parties negotiated for a potential business relationship, and then exchanged letters
regarding claimed trademark violations, (4) that defendants previously entered into a
contractual relationship with SolaRight’s predecessor, NextGen, to sell the subject
products, and (5) that defendants attempted to sell their products to the ODOT. The court
concludes that these contacts are insufficient to show the minimum contacts necessary to
the exercise of personal jurisdiction over defendants based on the evidence presented.
Defendants’ knowledge that SolaRight was an Oklahoma company does not, by
itself, establish specific jurisdiction. SolaRight essentially argues that Dudnikov is to the
contrary, and that knowledge that the harm of an act would be felt in Oklahoma is
enough. But Dudnikov does not go that far. In Dudnikov, the defendants sent trademark
infringement notices to eBay in order to shut down the plaintiff’s eBay account. The
plaintiffs alleged that defendants knew they were based in Colorado, and therefore when
they sent the notice to eBay they did so “with the ultimate purpose of cancelling
plaintiffs’ auction site in Colorado.” Id. at 1077. The Tenth Circuit concluded that
Colorado did have personal jurisdiction over the defendants, relying on the fact the
defendants there specifically sought to shut down the plaintiff’s auction in Colorado.
But the Court also explicitly rejected the suggestion that the foreseeability of an injury in
the forum state, by itself, was enough to establish specific jurisdiction. Citing Calder, it
stated that there must also be a showing that defendant’s intentional actions were
expressly aimed at the forum state. Id.
Here, plaintiff has made no such showing. Defendants knew they were dealing
with an Oklahoma company and could no doubt foresee that any actions they took would
have an impact on an Oklahoma company. But plaintiffs have shown nothing beyond
that such as would establish that defendants’ actions were aimed at Oklahoma.
The single meeting between executives in Oklahoma City does not suggest the
contrary. The evidence established that the meeting was initiated by plaintiff and that
defendants came to Oklahoma at the invitation of plaintiff. Those circumstances do not
suggest that defendants were expressly aiming their efforts at Oklahoma. Rather, the
hearing evidence suggests that defendants’ focus was Florida and their distribution and
other activities in that state. Further, Florida appears to have been the focus of the
relationship with the predecessor entity, NextGen.
Similarly, the evidence as to phone calls and emails does not suggest some focus
on Oklahoma. But for the fortuity of plaintiff’s representatives being based in Oklahoma,
the same contacts and negotiations as occurred between these parties could have occurred
anywhere. Further, it is “well-established that phone calls and letters are not necessarily
sufficient in themselves to establish minimum contacts.”
Far West Capital, Inc. v.
Towne, 46 F.3d 1071, 1077 (10th Cir. 1995).
Plaintiff’s allegation in its initial submissions that defendants were seeking to sell
the subject products to the Oklahoma Department of Transportation had the potential to
be a significant, and potentially determinative, contact with Oklahoma. But the hearing
testimony ultimately suggested something else. Mr. Majdalawi’s unchallenged testimony
was that a single meeting with ODOT occurred in August 2014, at a time when defendant
Lux was not even in existence. Further, Mr. Majdalawi attended himself only to assist
with the presentation to ODOT of NextGen, plaintiff’s predecessor company. There is no
evidence that he sought to sell anything for his own account, or that he was somehow
acting for the company he eventually established some time later.
In short, the few contacts that defendants had with Oklahoma were only the sort of
“random, fortuitous, or attenuated” contacts that are insufficient for jurisdiction. Burger
King, 471 U.S. at 475. They did not reflect actions that were focused on Oklahoma. As
a result, the court concludes plaintiff’s evidence as to defendants’ suit-related conduct
does not establish the necessary “substantial connection with the forum State.” Walden,
134 S. Ct. at 1121.
Defendant’s motion to dismiss [Doc. #19] is GRANTED.
This case is
DISMISSED WITHOUT PREJUDICE for lack of personal jurisdiction over the
defendants. Judgment will enter accordingly.
IT IS SO ORDERED
Dated this 12th day of January, 2017.
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