905 F.3d 1 (1st Cir. 2018), 18-1195, Plixer International, Inc. v. Scrutinizer GmbH

Docket Nº:18-1195
Citation:905 F.3d 1, 128 U.S.P.Q.2d 1274
Opinion Judge:LYNCH, Circuit Judge.
Party Name:PLIXER INTERNATIONAL, INC., Plaintiff, Appellee, v. SCRUTINIZER GMBH, Defendant, Appellant.
Attorney:James G. Goggin, with whom Verrill Dana, LLP, Portland, ME, was on brief, for appellee. John A. Woodcock III, with whom Edward J. Sackman and Bernstein Shur PA, Manchester, NH, were on brief, for appellant.
Judge Panel:Before Lynch, Selya, and Lipez, Circuit Judges.
Case Date:September 13, 2018
Court:United States Courts of Appeals, Court of Appeals for the First Circuit

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905 F.3d 1 (1st Cir. 2018)

128 U.S.P.Q.2d 1274

PLIXER INTERNATIONAL, INC., Plaintiff, Appellee,


SCRUTINIZER GMBH, Defendant, Appellant.

No. 18-1195

United States Court of Appeals, First Circuit

September 13, 2018

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James G. Goggin, with whom Verrill Dana, LLP, Portland, ME, was on brief, for appellee.

John A. Woodcock III, with whom Edward J. Sackman and Bernstein Shur PA, Manchester, NH, were on brief, for appellant.

Before Lynch, Selya, and Lipez, Circuit Judges.


LYNCH, Circuit Judge.

Given the particular facts of this case, we affirm the thoughtful holding of the district court that the exercise of specific personal jurisdiction against a German corporation under Federal Rule of Civil Procedure 4(k)(2) does not offend the Due Process Clause of the United States Constitution. We note that this is an area in which the Supreme Court has not yet had the occasion to give clear guidance, and so we deliberately avoid creating any broad rules.


We take the following facts from the undisputed record. Scrutinizer GmbH1 (Scrutinizer) is a German corporation with its principal place of business in Kassel, Germany. Through its interactive, English-language website, Scrutinizer runs a "self-service platform" that helps customers build better software. Scrutinizer brings its customers’ code from a third-party hosting service like GitHub2 to its "controlled cloud environment," where it runs "software analysis tools" meant to "improve source-code quality, eliminate bugs, and find security vulnerabilities." Scrutinizer offers potential customers a fourteen-day free trial. In the course of its activities, Scrutinizer employs Google Analytics.

Customers who contract to use Scrutinizer’s online service can pay only in euros. Scrutinizer’s standard contract with those customers contains a forum-selection clause and a choice-of-law clause that provide that all lawsuits relating to the contract be brought in German courts and under German law. Scrutinizer maintains no U.S. office, phone number, or agent for service of process; it directs no advertising at the United States; and its employees do not go to the United States on business.

Scrutinizer provides its service globally. In an affidavit, Scrutinizer’s founder said that customers can use the service "anywhere where Internet access is available." Scrutinizer’s website states that it is "[t]rusted by over 5000 projects and companies around the world." Over three-and-a-half years, from January 2014 to June 2017,3 Scrutinizer sold its services to 156

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U.S. customers. These sales occurred in thirty states, and the revenue from the contracts remitted to Scrutinizer € 165,212.07. This amount was just under $200,000 in June 2017. The record does not reveal what percentage of Scrutinizer’s total revenue comes from the United States. It does, however, detail Scrutinizer’s customer numbers by state: from fifty-one in California to one in each of eight other states. During the three-and-a-half year period, Scrutinizer had two Maine customers, who collectively paid Scrutinizer € 3,100 for its services.

Plixer International, Inc. (Plixer), a Maine corporation, sued Scrutinizer in federal district court in Maine on November 21, 2016, for trademark infringement. Plixer owns the U.S. registered mark "Scrutinizer," for which it filed in July 2015. Plixer’s trademark application said that Plixer used the mark as early as November 2005. That application covered "[c]omputer software and hardware for analyzing, reporting and responding to malware infections and application performance problems, used in the field of information technology." In its complaint, Plixer alleged that Scrutinizer’s use of the term "Scrutinizer" caused "confusion, mistake or deception as to the source" of Scrutinizer’s services; that the use "will infringe and/or dilute Plixer’s prior rights" in the mark; that the use "will interfere with Plixer’s use" of its mark; and that Scrutinizer’s "services are closely related to the services covered by Plixer’s" mark, so "the public is likely to be confused about whether Plixer is the source of [Scrutinizer’s] services or whether Plixer is affiliated with or the sponsor of [Scrutinizer’s] services."

Plixer gave two bases for personal jurisdiction over Scrutinizer, only one of which is at issue in this appeal.[4] It said that Scrutinizer’s nationwide contacts with the United States supported specific jurisdiction under Federal Rule of Civil Procedure 4(k)(2). After rejecting an initial motion to dismiss,5 the district court allowed limited jurisdictional discovery.

In January 2017, after this lawsuit began, Scrutinizer filed a U.S. trademark application for "Scrutinizer." The record is silent on the reasons why Scrutinizer filed this application.

On prima facie review, the district court found that it could constitutionally exercise specific personal jurisdiction over Scrutinizer under Rule 4(k)(2). Plixer Int’l, Inc. v. Scrutinizer GmbH, 293 F.Supp.3d 232, 245 (D. Me. 2017). It held that Scrutinizer "operated a highly interactive website that sold its cloud-based services directly through the website, that it was open to business throughout the world, that it accepted recurrent business from the United States in a substantial amount, and that it did so knowingly." Id. at 241. The district court concluded that the criteria for purposeful

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availment in the United States had been met. Id. at 242-43. The district court also found that the exercise of jurisdiction was reasonable and that Scrutinizer had not carried its burden of proving otherwise. Id. at 245.

As part of its analysis, the district court considered Scrutinizer’s application for U.S. trademark protection. The record gave the district court "no hint" why Scrutinizer had filed the application. Id. at 243. The district court did not find that contact conclusive, but said that "it does confirm [Scrutinizer’s] desire to deal with the American market." Id. at 243.

We granted this interlocutory appeal on the district court’s recommendation.6


A. Standard of Review

The district court held that Plixer had made a prima facie showing of personal jurisdiction. On prima facie review, we take the plaintiff’s evidentiary proffers as true and we consider uncontradicted facts proffered by the defendant. C.W. Downer & Co. v. Bioriginal Food & Sci. Corp., 771 F.3d 59, 65 (1st Cir. 2014). The plaintiff’s burden is to proffer evidence "sufficient to support findings of all facts essential to personal jurisdiction" without relying on unsupported allegations. A Corp. v. All Am. Plumbing, Inc., 812 F.3d 54, 58 (1st Cir. 2016). We review de novo the district court’s conclusion that Plixer met its burden of proffering sufficient evidence to support findings of all facts essential to personal jurisdiction. See Foster-Miller, Inc. v. Babcock & Wilcox Can., 46 F.3d 138, 147 (1st Cir. 1995).

B. Personal Jurisdiction

Plixer’s basis for asserting personal jurisdiction over Scrutinizer is Federal Rule of Civil Procedure 4(k)(2).7 Rule 4(k)(2) has three requirements: (1) the cause of action must arise under federal law; (2) the defendant must not be subject to the personal jurisdiction of any state court of general jurisdiction; and (3) the federal court’s exercise of personal jurisdiction must comport with due process. United States v. Swiss Am. Bank, Ltd. (Swiss I), 191 F.3d 30, 38 (1st Cir. 1999). All parties agree that the first two requirements are met here. The question is whether personal jurisdiction comports with due process.

This is a federal question case, so constitutional limits on jurisdiction come from the Due Process Clause of the Fifth Amendment. United States v. Swiss Am. Bank, Ltd. (Swiss II), 274 F.3d 610, 618 (1st Cir. 2001). The Fifth Amendment Due Process Clause requires the plaintiff to "show that the defendant has adequate contacts with the United States as a whole, rather than with a particular state."8 Id.

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To see if Scrutinizer’s nationwide contacts are adequate, we turn to the familiar "minimum contacts" framework.

Due process requires that the defendant "have certain minimum contacts with [the forum] such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’ " Int’l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463, 61 S.Ct. 339, 85 L.Ed. 278 (1940) ). Plixer has asserted specific personal jurisdiction over Scrutinizer, so the minimum contacts inquiry has...

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