Power Systems, Inc v. The Hygenic Corporation (TV3)

Filing 31

MEMORANDUM AND OPINION. Signed by Chief District Judge Thomas A Varlan on 6/24/14. (JBR)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF TENNESSEE
AT KNOXVILLE
POWER SYSTEMS, INC.,
Plaintiff,
v.
THE HYGENIC CORPORATION, and
HYGENIC INTANGIBLE PROPERTY
HOLDING CO.,
Defendants.

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) No.: 3:13-CV-382-TAV-CCS
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MEMORANDUM OPINION
This civil matter is before the Court on The Hygenic Corporation (“Hygenic”) and
Hygenic Intangible Property Holding Co.’s (“HIPHC”) (collectively, “defendants”)
Motion to Dismiss [Doc. 9], in which defendants move to dismiss the amended complaint
[Doc. 4] filed by plaintiff Power Systems, Inc. on jurisdictional and other grounds.
Plaintiff filed a response [Doc. 21], to which defendants filed a reply [Doc. 25]. Both
parties submitted affidavits and exhibits in support of their respective positions. For the
reasons discussed herein, and in light of the relevant case law, defendants’ motion [Doc.
9] will be granted and plaintiffs’ claims against defendants will be dismissed.
I.

Background
This dispute arises from the parties’ development and sale of color-coded

resistance bands used in the physical therapy and rehabilitation industries [Doc. 4 ¶¶ 6,
19].

Plaintiff, a Tennessee corporation headquartered in Knoxville, Tennessee, is

involved in the international distribution of fitness, exercise, and other athletic products
and equipment [Id. ¶ 1]. Plaintiff conducts business through catalogs and online [Id.].
Hygenic is a Delaware corporation located in Akron, Ohio [Id. ¶ 2; Doc. 9 at 5]. HIPHC
is a Nevada Corporation, which holds intellectual property assets used by Hygenic and is
similarly located in Akron, Ohio [Id. ¶ 2]. Hygenic is also involved in the sale and
distribution of rehabilitative equipment, including a line of resistive elastic bands known
as “THERA-BAND” [Doc. 4 ¶ 10; Doc. 9-1 ¶ 3].1 Hygenic asserts trade dress rights
associated with the THERA-BAND line in the form of a color scheme, which includes
shades of yellow, red, green, blue, black, and silver/gray and is used by Hygenic in its
advertising, packaging, and on its products to designate or identify the THERA-BAND
brand [Doc. 4 ¶ 10; Doc. 9-1 ¶ 3].
It is undisputed that defendants have no offices, employees, or other physical
presence in Tennessee, and are not authorized to do business within the state [Doc. 9-1 ¶
6]. Hygenic does, however, sell its products to various distributors, including plaintiff,
who in turn sell THERA-BAND products on a national basis, including in Tennessee.
These arrangements are governed by purchase agreements entitled “Terms and
Conditions of Sale,” which, among other terms, provide that each agreement is governed
by Ohio law [Doc. 25-2].

Plaintiff alleges that its agreements with Hygenic have

produced approximately $250,000 in therapeutic band sales across the country [Doc. 21
at 22]. In addition to sales generated by end-retailers who receive their inventory from

1

Hygenic also sells another line of resistive products known as DYNA-BAND [Id.].
2

Hygenic or other distributors, Hygenic also runs a website that enables purchasing in two
ways. First, consumers are able to purchase directly from the website using the site’s
online shopping features [Doc. 4 ¶ 8; Doc. 21-6 at 3]. In addition, Hygenic’s website
enables consumers to find local retailers by entering in their zip code or city to purchase
THERA-BAND products in person, directing site users to where a given retailer is
located and to what products it offers [Doc. 21-6 at 4-5].
On September 10, 2012, Hygenic, acting through counsel, sent a letter via
electronic mail to plaintiff’s Knoxville headquarters regarding what Hygenic
characterized as the “[u]nauthorized” use of the THERA-BAND trade dress in plaintiff’s
sale of its “Versa-Loop” resistive exercise products [Doc. 4-1]. In the letter, Hygenic
notes that its trade dress is associated with other registered trademarks owned by
defendants, including the THERA-BAND logo and pyramid design, illustrations of which
are set forth in the letter itself [Id.]. Hygenic also notes its previous enforcement of the
trade dress, specifically referencing a case in which it was involved, Fabrication
Enterprises, Inc. v. Hygenic Corporation, 64 F.3d 53 (2d Cir. 1995), and contends that
trade dress need not be registered in order to be protected [Id.]. In addition, Hygenic
asserts that plaintiff’s replication of the trade dress is likely to confuse consumers and
diminish the value of the trade dress [Id.]. The letter goes on to state that Hygenic would
discuss color schemes that did not infringe the trade dress were plaintiff to change its
scheme and requests both written confirmation and a proposed timeline for doing so [Id.].
Following this letter, from August 2012 through October 2012 and again in May 2013,
3

plaintiff alleges that Hygenic made several phone calls and exchanged emails with
plaintiff to discuss changes being made to plaintiff’s color scheme.
After these discussions failed to produce a resolution, plaintiff filed this
declaratory action on July 1, 2013 [Doc. 1]. In its amended complaint [Doc. 4], plaintiff
seeks a declaratory judgment that it is not infringing defendant’s trade dress because the
trade dress is invalid or because plaintiff’s actions will not cause any actionable
likelihood of confusion [Id. ¶¶ 51-57]. Plaintiff also moves for cancellation of several
marks owned by HIPHC on the United States Supplemental Registration, Nos. 2,037,964,
2,037,965, and 2,037,966, covering marks based on the colors green, pink, and purple
when used to indicate the amount of resistance in resistive exercise bands [Id. ¶¶ 43-50].
In addition to declaratory relief, plaintiff seeks injunctive relief preventing defendants
from filing a cause of action against plaintiff for infringement as well as unspecified
damages [Id.].
Defendants subsequently filed the instant motion [Doc. 9], arguing that plaintiff’s
complaint should be dismissed in its entirety for lack of personal jurisdiction, improper
venue, and failure to comply with Rule 8 of the Federal Rules of Civil Procedure.
Defendants also argue, in the alternative, that plaintiff’s claims regarding cancellation of
the marks which form the basis for the DYNA-BAND trade dress should be dismissed for
lack of subject matter jurisdiction. The Court will address defendants’ arguments in turn.

4

II.

Personal Jurisdiction
A.

Standard of Review

In the context of a Rule 12(b)(2) motion based on lack of personal jurisdiction, the
plaintiff bears the burden of establishing the existence of personal jurisdiction. Air
Prods. & Controls, Inc. v. Safetech Int’l, Inc., 503 F.3d 544, 549 (6th Cir. 2007) (citing
Serras v. First Tenn. Bank Nat’l Ass’n, 875 F.2d 1212, 1214 (6th Cir. 1989)). A district
court may address such a motion on the parties’ submissions or it may permit limited
discovery and hold an evidentiary hearing. Id. When, as here, the Court does not
conduct an evidentiary hearing and relies solely on written submissions and affidavits to
resolve the Rule 12(b)(2) motion, “the plaintiff need only make a prima facie showing of
jurisdiction.

In this situation, [the Court] will not consider facts proffered by the

defendant that conflict with those offered by the plaintiff, and [it] will construe the facts
in a light most favorable to the nonmoving party.” Indah v. S.E.C., 661 F.3d 914, 920
(6th Cir. 2011) (internal citations and quotations omitted). Because the Court relies
solely on the written submissions and affidavits to resolve the jurisdictional issue, the
burden on the plaintiff is “relatively slight.” See Air Prods., 503 F.3d at 549 (citing Am.
Greetings Corp. v. Cohn, 839 F.2d 1164, 1169 (6th Cir. 1988)).
“Due process requires that a defendant have ‘minimum contacts . . . with the
forum State . . . such that he should reasonably anticipate being haled into court there.’”
Schneider v. Hardesty, 669 F.3d 693, 701 (6th Cir. 2012) (quoting World-Wide

5

Volkswagen Corp. v. Woodson, 444 U.S. 286, 291, 297 (1980)).

This requirement

ensures that the exercise of jurisdiction does not “offend traditional notions of fair play
and substantial justice.”

See Int’l Shoe Co. v. Wash., 326 U.S. 310, 316 (1945);

Schneider, 669 F.3d at 701. Depending on the type of minimum contacts in a case,
personal jurisdiction can take one of two forms, general or specific. Air Prods., 503 F.3d
at 550; see, e.g,. Bird v. Parsons, 289 F.3d 865, 873 (6th Cir. 2002).

Although

defendants argue that neither general nor specific jurisdiction exists, the parties’ briefs
focus almost exclusively on the presence of specific jurisdiction, so the Court will focus
its analysis on this form of personal jurisdiction.2
“[S]pecific jurisdiction is confined to the adjudication of issues deriving from, or
connected with, the very controversy that establishes jurisdiction.” Indah, 661 F.3d at
920 (quoting Goodyear Dunlop Tires Org. v. Brown, — U.S. — , — , 131 S.Ct. 2846,
2851 (2011)) (internal quotation marks omitted). That is, specific jurisdiction “exposes
the defendant to suit in the forum state only on claims that ‘arise out of or relate to’ a
defendant’s contacts with the forum.” Kerry Steel, Inc. v. Paragon Indus., Inc., 106 F.3d
147, 149 (6th Cir. 1997) (quoting Helicopteros Nacionales, 466 U.S. at 414-15 & nn. 8-

2

The Court notes, however, that as general jurisdiction requires a “continuous and
systematic presence” in Tennessee, Bird, 289 F.3d at 874 (quotations omitted), defendants would
not be subject to general jurisdiction within Tennessee based on its sales to distributors such as
plaintiff and its operation of a website that facilitates sales. See id. (holding that fact of
defendant’s operation of website generally accessible to anyone was insufficient to confer
general jurisdiction); see also Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408
at 416-18 (1984) (finding that purchases, even those “occurring at regular intervals,” were
insufficient to confer general jurisdiction).
6

10). The Sixth Circuit has developed three criteria for determining whether specific
jurisdiction exists over a particular defendant:
First, the defendant must purposefully avail himself of the privilege of
acting in the forum state or causing a consequence in the forum state.
Second, the cause of action must arise from the defendant’s activities there.
Finally, the acts of the defendant or consequences caused by the defendant
must have a substantial enough connection with the forum state to make the
exercise of jurisdiction over the defendant reasonable.
Bird, 289 F.3d at 874 (quoting S. Mach. Co. v. Mohasco Indus., Inc., 401 F.2d 374, 381
(6th Cir. 1968)).
Thus, for the exercise of specific personal jurisdiction to be appropriate,
defendants must have purposefully availed themselves of the privilege of acting or
causing a consequence in Tennessee, the instant cause of action must arise from those
activities, and defendants’ acts or the consequences of those activities must have a
substantial enough connection with Tennessee to make the exercise of personal
jurisdiction reasonable. Mohasco, 401 F.2d at 381.
B.

Analysis

In this case, the parties’ dispute centers more on the legal significance of
defendants’ contacts with Tennessee rather than on factual disputes as to the nature of
defendants’ contacts.

Defendants argue that the contacts alleged by plaintiff are

insufficient as a matter of law to support a prima facie showing of personal jurisdiction.
Specifically, defendants argue that the September 2012 letter and subsequent
communications in which Hygenic attempted to enforce its trade dress rights could not
satisfy the purposeful availment requirement. In addition, defendants submit that it
7

would be unreasonable to justify personal jurisdiction based on these enforcement
activities alone, as the remaining contacts defendants have with Tennessee are not related
to plaintiff’s declaratory action.
Plaintiff argues in response that defendants’ contacts with Tennessee are sufficient
for the exercise of personal jurisdiction, focusing in particular on the following facts: 1)
Hygenic’s interactions with plaintiff, a Tennessee company, regarding the national
distribution of its products; 2) Hygenic’s website, which permits Tennessee customers to
purchase THERA-BAND products over the internet while also directing customers where
to purchase THERA-BAND products in Tennessee; and 3) Hygenic’s communications
with plaintiff regarding plaintiff’s alleged infringement.
1.

Purposeful Availment

Turning to the first Mohasco requirement, “the purposeful availment requirement
‘gives a degree of predictability to the legal system that allows defendants to structure
their primary conduct with some minimum assurance as to where that conduct will and
will not render them liable to suit.’” Kerry Steel, 106 F.3d at 150 (quoting World-Wide
Volkswagen, 44 U.S. at 297). This “ensures that a defendant will not be haled into a
jurisdiction solely as a result of random, fortuitous, or attenuated contacts.”

Id.

(quotations omitted). As noted by the Sixth Circuit, the requirement does not “mean that
a defendant must be physically present in the forum state[,]” CompuServe, Inc. v.
Patterson, 89 F.3d 1257, 1264 (6th Cir. 1996), and jurisdiction may be exercised “‘[s]o
long as a commercial actor’s efforts are purposefully directed toward residents of another
8

State [,]’” id. (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476 (1985)). Such
efforts, however, must go beyond merely injecting a product into the stream of
commerce. Bridgeport Music, Inc. v. Still N The Water Pub., 327 F.3d 472, 479-80 (6th
Cir. 2003). Ultimately, it is the “quality rather than the quantity of the contacts” that is
the proper focus of the analysis. Calphalon Corp. v. Rowlette, 228 F.3d 718, 722 (6th
Cir. 2000) (citation omitted).
In this case, the Court finds that, at least with respect to Hygenic, plaintiff has
presented a prima facie showing that Hygenic purposefully availed itself of the privilege
of acting in the state of Tennessee. Although Hygenic’s enforcement activity alone
would be insufficient to confer jurisdiction, see America’s Collectibles Network, Inc. v.
Scorpiniti, No. 3:06-CV-270, 2007 WL 470351, at *3 (E.D. Tenn. Feb. 8, 2007) (Phillips,
J.) (noting that letter and phone calls regarding a plaintiff’s infringing activity did not
confer specific personal jurisdiction), Hygenic was and is engaged in other activity with
the state. Hygenic entered into purchase agreements with plaintiff, thereby sending
shipments of its product to Tennessee for distribution by plaintiff both in Tennessee and
elsewhere. Hygenic also supervised the sale and distribution of its product by issuance of
purchase agreements, which, although governed by Ohio law, were sent to plaintiff in
Tennessee, and were coupled with various other communications by Hygenic regarding
plaintiff’s distribution efforts [See Doc. 21-9].

9

Beyond Hygenic’s interaction with plaintiff, Hygenic also has contacts with
Tennessee through its THERA-BAND website. The website not only permits consumers
to purchase products directly, it also enables consumers to find THERA-BAND products
within their geographic area, giving consumers a map of their location, contact
information, as well as the specific products sold by a particular practitioner [Doc. 21-6 at
4-5]. Although the operation of a website alone may not constitute purposeful availment,
the requirement may be met where, as here, the “website is interactive to a degree that
reveals specifically intended interaction with residents of the state.” Bird, 289 F.3d at
874-75. Similar to the manner in which the defendants in Bird hosted a website through
which forum residents could and did register domain names, thereby availing themselves
of the privileges of the forum, Hygenic encouraged Tennessee residents to purchase its
products in Tennessee by providing them specific information on where the products
could be located. See, e.g., Neogen Corp. v. Neo Gen Screening, Inc., 282 F.3d 883, 890
(6th Cir. 2002) (noting that interactive features of website, such as providing forum
residents with passwords upon purchase of services, supported finding of purposeful
availment). While neither Hygenic’s relationship with plaintiff nor the services offered
on its website to Tennessee consumers would necessarily be sufficient on their own to
find the first Mohasco requirement has been met, both activities taken together, combined
with Hygenic’s enforcement activity with plaintiff, indicate that Hygenic availed itself of
the privilege of acting within Tennessee.

10

2.

Whether the Cause of Action “Arises From” Defendants’
Activities

The Court’s conclusion that Hygenic availed itself of the privileges of acting in
Tennessee, based on the previously described contacts, is insufficient to confer specific
personal jurisdiction in this case; the claims against it must also arise out of those
contacts. CompuServe, 89 F.3d at 1267 (citing Reynolds v. Int’l Amateur Athletic Fed’n,
23 F.3d 1110, 1116-17 (6th Cir. 1994)). “‘If a defendant’s contacts with the forum state
are related to the operative facts of the controversy, then an action will be deemed to have
arisen from those contacts.’” Bird, 289 F.3d at 875 (quoting CompuServe, 89 F.3d at
1267).

“This factor does not require that the cause of action formally arise from

defendant’s contacts with the forum; rather, this criterion requires only that the cause of
action, of whatever type, have a substantial connection with the defendant’s in-state
activities.” Id. (quoting Third Nat’l Bank in Nashville v. WEDGE Grp., Inc., 882 F.2d
1087, 1091 (6th Cir. 1989)) (internal quotation marks omitted); see, e.g., Comty. Trust,
692 F.3d at 472 (noting that defendant’s contacts with forum “must relate to operative
facts and nature of the controversy”).
This litigation involves an action for declaratory relief.

As the Court has

previously noted in the patent context, “‘the nature of the claim in a declaratory judgment
action is to clear the air of infringement charges.’” Radio Sys. Corp. v. Accession, Inc.,
No. 3:09-CV-481, 2010 WL 2103443, at *4 (E.D. Tenn. May 21, 2010) (quoting Avocent
Huntsville Corp. v. Aten Int’l Co., Ltd., 552 F.3d 1324, 1332 (Fed. Cir. 2008)). Such a
claim “neither directly arises out of nor relates to the . . . offering to sell . . . of arguably
11

infringing products in the forum.” Id. (alterations in original) (quotations omitted).
Because the claim arises not from commercialization but from the activities of the
defendant in enforcing the relevant patent suit, Avocent, 552 F.3d at 1332, the relevant
inquiry becomes the extent to which a defendant purposefully directed enforcement
activities at residents of the forum, “and the extent to which the declaratory judgment
claim ‘arises out of or relates to those activities[,]’” id. at 1332-33 (quoting Breckenridge
Pharm., Inc. v. Metabolite Labs., Inc, 444 F.3d 1356, 1363 (Fed. Cir. 2006)). Several
district courts have held that evidence of sales or shipment to the forum is insufficient to
show the requisite nexus between a defendant’s contacts and a declaratory cause of action
in the trademark context. See Marlin Firearms, Co. v. Wild West Guns, LLC, No. 3:09CV-921 (RNC), 2013 WL 2405510, at *4-5 (D. Conn. May 31, 2013) (finding evidence
of sale and shipment of product insufficient in trademark declaratory action because
plaintiff’s “cause of action would exist even if the sale and shipment had never occurred”
and citing cases); Rolling Thunder, LLC v. Indian Motorcycle Int’l, No. 2:07-CV-52 TS,
2007 WL 2327590, at *3 (D. Utah Aug. 10, 2007) (finding internet sales insufficient for
finding of nexus because it was in “nowise” related to claim for declaration of noninfringement).
While the parties here spend a great deal of argument over the extent of Hygenic’s
commercial efforts in Tennessee, whether through the internet or through Tennesseebased distributors, the Court finds that the only contacts giving rise to, or forming part of
the operative facts of, the controversy pertain to Hygenic’s enforcement activity, that is,
12

the September 2012 letter and follow-up emails and phone calls to plaintiff. While
Hygenic’s Tennessee sales may serve as evidence of purposeful availment, as previously
discussed, plaintiff has not shown what relationship, direct or indirect, those sales bear to
the question of the validity of Hygenic’s asserted trade dress and registered marks. The
purpose of this action is to “clear the air” of any allegations of infringement, rather than
to determine whether plaintiff has engaged in any infringement, an issue that would
involve defendant’s use of the mark in commerce. Avocent, 552 F.3d at 1332. Given the
legal issues presented by plaintiff, defendant’s own commercial activity within Tennessee
is immaterial to the determination of this action, which would have existed even if
defendant’s sales “never occurred.” See Marlin, 2013 WL 2405510, at *5. Thus, it is
only defendant’s enforcement activities within Tennessee that gave rise to the present
declaratory action.
Plaintiff attempts to analogize Hygenic’s contacts to the contacts of the defendant
in CompuServe to show that its action arises from Hygenic’s activities. The Court,
however, finds that case inapposite. In CompuServe, the plaintiff, an Ohio corporation,
brought a declaratory action in Ohio against a Texas defendant who had entered into a
shareware agreement with the plaintiff which was governed by Ohio law and under
which the defendant’s software was provided to the plaintiff’s subscribers through the
plaintiff’s server. 89 F.3d at 1260-61. The software files transmitted to the plaintiff from
the defendant were stored on the plaintiff’s server in Ohio, where the defendant also
engaged in exclusive marketing of his software. After the defendant asserted common
13

law trademark rights that he believed the plaintiff had infringed, requesting a $100,000
settlement, the plaintiff filed its declaratory action, which, following dismissal by the
district court on personal jurisdiction grounds, was appealed to the Sixth Circuit. Id. at
1261. In reversing the district court, the Sixth Circuit found that the defendant’s contacts
with Ohio gave rise to the plaintiff’s declaratory action, because the defendant “placed,
marketed, and sold his software only on Ohio-based CompuServe. Thus, any common
law trademark or trade name which [defendant] might have in his product would
arguably have been created in Ohio . . . .” Id. at 1267.3 In this case, however, Hygenic’s
contractual relationship with plaintiff was not exclusive, nor did plaintiff’s sales of
Hygenic’s product occur only in Tennessee. More importantly, the trade dress rights
discussed by Hygenic in its September 2012 letter and subsequent discussions are not
based on common law theories but rather the Lanham Act, further diminishing the
relationship between this declaratory action and Hygenic’s Tennessee sales and
marketing efforts.

Thus, the Court finds that defendant’s only relevant contact for

purposes of determining whether exercising jurisdiction would be reasonable is
Hygenic’s enforcement activity.
3.

Whether the Exercise of Jurisdiction is Reasonable

The Court finally considers whether exercising personal jurisdiction over
defendant would be reasonable in this instance, that is, “whether it would ‘comport with
traditional notions of fair play and substantial justice.’” CompuServe, 89 F.3d at 1268
3

The Sixth Circuit also found that the defendant had availed himself of the privileges of
Ohio for the purposes of specific personal jurisdiction.
14

(quoting Reynolds, 23 F.3d at 1117). An inference arises that this element may be
satisfied when the other requirements have been met, id., but the Court must nonetheless
consider several factors in making a determination as to this Mohasco element, including
“the burden on the defendant, the interest of the forum state, the plaintiff’s interest in
obtaining relief, and the interest of other states in securing the most efficient resolution of
controversies,” id. (quotation omitted).
In the intellectual property declaratory judgment context, the Federal Circuit has
held that, in patent cases, cease-and-desist letters and similar enforcement activities,
alone, do not suffice to create personal jurisdiction because to permit otherwise would be
inconsistent with the principles of fairness underlying the personal jurisdiction analysis.
Red Wing Shoe, Inc. v. Hockerson-Halberstadt, Inc., 148 F.3d 1355, 1360-61 (Fed. Cir.
1998); Avocent, 552 F.3d at 1334. Specifically, the Red Wing court held:
principles of fair play and substantial justice afford a patentee sufficient
latitude to inform others of its patent rights without subjecting itself to
jurisdiction in a foreign forum. A patentee should not subject itself to
personal jurisdiction in a forum solely by informing a party who happens to
be located there of suspected infringement.
Id.
Since Red Wing, the Federal Circuit has required additional judicial or extrajudicial activity related to enforcement, such as exclusive licensing agreements, in order
to find that exercising personal jurisdiction would comport with the requirements of Due
Process. Avocent, 552 F.3d at 1334-35 (citing cases); see, e.g. Campbell Pet Co. v.
Miale, 542 F.3d 879, 886 (Fed. Cir. 2008) (finding that additional acts of informing
15

customers of infringing product and attempting to have infringing product removed from
trade show in forum state were sufficient for personal jurisdiction). Numerous courts
have applied this reasoning in both the trademark and other contexts, finding cease and
desist letters and similar actions insufficient to confer personal jurisdiction.4 See Marlin,
2013 WL 2405510, at *6 (citing to Red Wing and finding that exercising jurisdiction
would be contrary to circuit case law regarding due process); Sinclair v. StudioCanal,
S.A., 709 F. Supp. 2d 496, 508-09 (E.D. La. 2010) (adopting reasoning of Federal Circuit
in granting motion to dismiss when only relevant contact was cease and desist letter);
Rolling Thunder, 2007 WL 2327590, at *2 (finding that cease and desist letter was “too
attenuated” to serve as basis for finding of personal jurisdiction); Douglas Furniture Co.
of Cal., Inc. v. Wood Dimensions, 963 F. Supp. 899, 903 (C.D. Cal. 1997) (“It would be
unreasonable to require an intellectual property owner to risk having to submit to the
jurisdiction of an alleged infringer in order to exercise his rights.”); see also Kehm Oil
Co. v. Texaco, Inc., 537 F.3d 290, 301 (3d Cir. 2008) (noting in contract case that “a
cease and desist letter does not rise to the level of purposeful availment for purposes of
jurisdiction,” citing Red Wing); Meta/Balance, Inc. v. Health Ventures Partners, No. 03

4

While plaintiff attempts to argue that the Federal Circuit’s decisions should be confined
to patent law, the Court finds the reasoning of those decisions persuasive in this case, given the
similarity in the due process inquiry See, Marlin Firearms, 2013 WL 2405510 at *6 n.8 (finding
Federal Circuit law persuasive authority and finding that the due process inquiry “similar”);
Nova Design Techs., Ltd. v. Walters, Civ. Action No. 10-7618, 2011 WL 5084566, at *7 (E.D.
Penn. Oct. 25, 2011) (rejecting plaintiff’s attempted distinction between patent and trademark
licensing).
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C 50497, 2004 WL 1345097, at *2 (N.D. Ill. June 14, 2004) (finding that mere licensing
of intellectual property was insufficient enforcement activity to establish jurisdiction).5
Considering the relevant case law as well as the factors prescribed by the Sixth
Circuit, the Court concludes that plaintiff has not made a prima facie showing that there
is a substantial enough connection with Tennessee so that exercising personal jurisdiction
in this case would comport with “traditional notions of fair play and substantial justice.”
Reynolds, 23 F.3d at 1117. As previously discussed, Hygenic’s only relevant contacts for
the purposes of this action are the September 2012 letter in which Hygenic informed
plaintiff of its trade dress and its belief that plaintiff’s products would confuse consumers,
as well as the subsequent phone calls and emails in which Hygenic and plaintiff
attempted to come up with a new color scheme for plaintiff’s products.6 The Court finds
these communications, without any other allegations or evidence of defendant’s judicial
or extra-judicial enforcement of its trade dress rights, are insufficient to make the exercise

5

But see ACG Food Cos., Inc. v. Wiscon Corp., No. 04-2589 Ml/V., 2005 WL 2114056
(W.D. Tenn. 2005) (finding exercise of personal jurisdiction appropriate based on email
informing plaintiff that defendant would oppose trademark registration and may undertake
“further legal action”); Meade Instruments Corp v. Reddwarf Starware LLC, No. SA CV
9802490GLT (ANx), 1998 WL 377041, at *2 (C.D. Cal. May 11, 1998) (finding exercise of
personal jurisdiction appropriate where defendant sent two cease-and-desist letters).
6

The Court notes that the communications in this case vary from the threats made by the
defendant in CompuServe, which were more extensive and involved actual settlement demands.
See 89 F.3d at 1266 (noting that defendant sent regular and electronic messages to plaintiff,
posted a message on electronic forum for anyone who wished to read it, and made demand of
$100,000 to settle the matter).
17

of personal jurisdiction in this case reasonable.7 As discussed by the court in Douglas
Furniture:
any other holding would discourage parties from attempting to resolve their
conflicts without resort to the legal system. If any attempt by an
intellectual property holder to put an alleged wrongdoer on notice forced
the property holder to submit to the jurisdiction of the alleged wrongdoer’s
forum, an intellectual property owner would be forced to file an action in
his own jurisdiction in order to avoid the threat of being haled before a
court in another, possibly distant state.
963 F. Supp. at 902.
The Court finds that the same reasoning applies here. Hygenic attempted to reach
out to plaintiff for the purpose of avoiding litigation. After those extra-judicial attempts
failed, plaintiff filed its declaratory complaint, seeking to not only have the THERABAND trade dress discussed in the September 2012 letter declared invalid but also to
have three marks registered on the supplemental registration cancelled, which were not
discussed in the September 2012 letter or ensuing communications. Although plaintiff
has an interest in obtaining declaratory relief, such interest must be weighed against the
burden placed on Hygenic in defending itself in a foreign jurisdiction with which it has
few relevant contacts, as well as the judicial interest in securing “the efficient resolution
of controversies.” See Red Wing, 148 F.3d at 1361 (finding policy favoring settlement
appropriate consideration under due process analysis). Having weighed these competing
7

Although the Court finds that the cease and desist letter at issue in this case insufficient
to confer jurisdiction, the Court notes that whether a cease and desist letter and related
enforcement activities are sufficient for exercising jurisdiction will depend upon the facts and
circumstances of each case. See Athletic Training Innovations, LLC v. L.A. Gear, Inc., No. 101524, 2010 WL 4103309 (E.D. La. Oct. 18, 2010) (finding personal jurisdiction where defendant
sent cease-and-desist letter to plaintiff in forum and also sent similar letters to plaintiff’s largest
customers).
18

interests, the Court concludes that it would be unreasonable to exercise personal
jurisdiction against Hygenic in this case, so that personal jurisdiction does not exist as to
Hygenic. For the same reasons, the Court also finds that it lacks personal jurisdiction as
to HIPHC, particularly given that HIPHC has less contacts with the forum state than
Hygenic itself.8
III.

Conclusion
For the reasons previously discussed, in light of the relevant case law and the

arguments of the parties, the Court concludes that plaintiff has failed to make a prima
facie showing that the Court has personal jurisdiction over defendants. 9 Accordingly,
defendants’ motion [Doc. 9] will be GRANTED, plaintiff’s claims against these
defendants will be DISMISSED, and this case will be closed.
ORDER ACCORDINGLY.

s/ Thomas A. Varlan
CHIEF UNITED STATES DISTRICT JUDGE

8

To the extent plaintiff requests permission to conduct discovery prior to a ruling on
defendant’s motion [Doc. 9], plaintiff has given no indication as to what discovery would be
conducted and what additional facts it would hope to learn that would make jurisdiction
reasonable. Accordingly, the Court denies any such request.
9

Given the Court’s dismissal on grounds of personal jurisdiction, the Court need not
address defendants’ remaining arguments.
19