Advanta-Star Auto. Research Corp. of Am. v. Search Optics, LLC
| Decision Date | 27 October 2021 |
| Docket Number | Civil Action 21-1174 |
| Parties | ADVANTA-STAR AUTOMOTIVE RESEARCH CORPORATION OF AMERICA v. SEARCH OPTICS, LLC, ET AL. |
| Court | U.S. District Court — Eastern District of Louisiana |
ADVANTA-STAR AUTOMOTIVE RESEARCH CORPORATION OF AMERICA
v.
SEARCH OPTICS, LLC, ET AL.
Civil Action No. 21-1174
United States District Court, E.D. Louisiana
October 27, 2021
SECTION: “G”
ORDER AND REASONS
NANNETTE JOLIVETTE BROWN, CHIEF JUDGE UNITED STATES DISTRICT COURT
In this litigation, Plaintiff Advanta-Star Automotive Research Corporation of America (“Plaintiff”) alleges Defendants Search Optics, LLC and Search Optics USA, LLC (collectively, “Defendants”) infringed Plaintiff's copyrighted material.[1] Before the Court is Defendants' “Motion to Dismiss for Lack of Personal Jurisdiction Pursuant to Federal Rule of Civil Procedure 12(b)(2).”[2] Having considered the motion, the memoranda in support and in opposition, the reply, the record, and the applicable law, the Court grants the motion.
I. Background
On June 16, 2021, Plaintiff filed a Complaint against Defendants in this Court.[3] According to the Complaint, Plaintiff is a Louisiana corporation that “creates, publishes, and sells detailed reviews, comparisons, and other original works of authorship related to automobiles and their
features.”[4] Plaintiff alleges that it licenses its materials under paid, written lease agreements.[5]
Plaintiff claims that in late 2011 or early 2012, it learned that Defendants “had reproduced and distributed to its customers some of [Plaintiff]'s copyrighted content, all without [Plaintiff]'s permission.”[6] According to Plaintiff, after confronting Defendants about the infringement, the parties entered into a licensing agreement in April 2012, which was thereafter renewed in July 2013.[7] Plaintiff claims that by late 2013, Defendants were in default of the agreement for failure to pay fees, and were distributing certain of Plaintiff's materials for which they had no license.[8]Plaintiff's claim that Defendants “acknowledged both its payment failure and its unauthorized use of [Plaintiff]'s copyrighted work, ” and agreed to pay its outstanding fees and cease infringement.[9]Plaintiff alleges that in late 2019, it discovered that Defendants were involved in providing services to car dealerships that were infringing on Plaintiff's materials.[10] Plaintiff claims that Defendants told Plaintiff they were investigating the alleged infringement, but that Defendants ceased communications in July 2020.[11]
On August 16, 2021, Defendants filed the instant “Motion to Dismiss for Lack of Personal Jurisdiction Pursuant to Federal Rule of Civil Procedure 12(b)(2).”[12] On August 30, 2021, Plaintiff
filed an opposition to the instant motion.[13] On September 20, 2021, Defendants filed a reply brief in further support of the instant motion.[14]
II. Parties' Arguments
A. Defendants' Arguments in Support of the Motion to Dismiss
On August 16, 2021, Defendants filed the instant motion to dismiss for lack of personal jurisdiction.[15] Defendants argue that Plaintiff has not met its burden of establishing that this Court has personal jurisdiction over Defendants.[16] Defendants claim that in the Complaint, Plaintiff's assertion of personal jurisdiction simply “parrots” Louisiana's long-arm statute.[17] Defendants contend that Plaintiff has failed to provide any facts to establish personal jurisdiction in Louisiana and thus, the Complaint “fails as a matter of law.”[18]
Furthermore, Defendants argue that this Court does not have personal jurisdiction over Defendants.[19] Defendants contend that the Court does not have specific personal jurisdiction because Plaintiff's claims do not arise out of Defendants' forum-related contacts.[20] Defendants highlight that all alleged acts of infringement took place in California and Illinois, and Defendants have no places of business nor employees in Louisiana.[21] Defendants further claim that this Court
does not have general personal jurisdiction over Defendants because Plaintiff has failed to plead any facts, and “there are no facts to plead, ” concerning Defendants' contacts with Louisiana.[22]Defendants contend that they do not have continuous or systematic contacts with Louisiana, do not have a place of business in the state, have no employees residing in the state, and did not make any sales or enter any contracts in Louisiana during the times relevant to this suit.[23]
B. Plaintiff's Opposition to the Motion to Dismiss
In opposition, Plaintiff argues that Defendants have sufficient minimum contacts with the State of Louisiana for this Court to exercise personal jurisdiction over Defendants.[24] Plaintiff points to various parts of the Complaint alleging that Defendants had contacts with Louisiana.[25]
Specifically, Plaintiff asserts that it contacted Defendants regarding infringement of Plaintiff's copyright-protected content in 2011 or 2012, and Defendants admitted to the infringement.[26] Plaintiff avers that Defendants entered into more than one licensing agreement with Plaintiff in 2012, and that Defendants were required to get approval from Plaintiff before publication of the licensed content.[27] Plaintiff asserts that it confronted Defendants about nonpayment of their license fees and the unauthorized use of certain content.[28]
Plaintiff further asserts that, in 2019, it discovered unauthorized copies of its content being
used by dealerships, and sent demand letters to the dealerships.[29] Plaintiff claims that Defendants' counsel then emailed Plaintiff's counsel about certain dealerships' unauthorized use of its content.[30] Plaintiff further claims that Plaintiff and Defendants engaged in a “series of communications by email and by phone” in which Defendants' counsel said he would provide information about the individual who had used Plaintiff's content without authorization.[31] Plaintiff asserts that Defendants stopped communication with Plaintiff in January 2020.[32] Furthermore, Plaintiff claims that Defendants “specifically inserted [themselves] in this case when [they] responded to Advanta-Star's demand letters that were sent to two of [their] customers.”[33] Based on these allegations, Plaintiff argues that Defendants have sufficient minimum contacts with Louisiana.
Next, Plaintiff argues that these contacts are sufficiently linked to this cause of action to establish specific personal jurisdiction over Defendants. Plaintiff argues that the lack of physical presence in Louisiana is not determinative because “copyright infringement is a commercial tort which can cause effects where the copyright owner resides.”[34] Thus, Plaintiff argues that “there is a nexus between activities directed at a forum state that give rise to copyright infringement causing effects in that forum state.”[35]
Furthermore, Plaintiff argues that its claims are related to Defendants contacts with Louisiana because Defendants “purposefully settled its prior copyright infringement dispute with Advanta-Star, a Louisiana company, ” by entering into licensing agreements related to different copyright-protected works that “were of the same nature, same purpose, and owned by the same claimant” as the copyrights at issue in this case.[36]
Finally, Plaintiffs assert that there is general personal jurisdiction over Defendants because “Search Optics regularly does and solicits business in all fifty of the United States, including Louisiana, ”[37] and that Defendants' content “makes its way into all fifty state through its nationwide partners.”[38]
C. Defendants' Arguments in Further Support of the Motion
In the reply brief, Defendants argue again that Plaintiff has not established specific jurisdiction over Defendants. First, Defendants argue that the prior copyright licensing agreements cannot provide a basis for specific jurisdiction over Defendants.[39] Those agreements, Defendants assert, covered different copyrighted works and have since been terminated.[40] Because those licensing agreements are not at issue in this lawsuit, Defendants argue that “this case did not arise out of” Defendants contacts with Louisiana.[41] Second, Defendants argue that Plaintiff's location in Louisiana does not provide a basis for specific jurisdiction.[42] Defendants assert that “the fact
that an ‘effect' was allegedly felt in Louisiana is of no moment.”[43] Third, Defendants contend that they are not subject to specific jurisdiction simply because they responded to Plaintiff's demand letter.[44]
Defendants further contend that Plaintiff “does not meaningfully dispute that this Court cannot properly exercise general personal jurisdiction over Defendants.”[45] Defendants argue that Plaintiff's allegations regarding general jurisdiction based on Defendants' content entering all fifty states is “based solely on speculation.”[46] They assert that the “continuous and systematic contacts” test is difficult to meet, and their “non-existent contacts with Louisiana certainly fall well short of that standard.”[47]
III. Legal Standard
Federal Rule of Civil Procedure 12(b)(2) permits a court to dismiss a plaintiff's claims when the court does not have personal jurisdiction over a defendant.[48] The party seeking to invoke the power of the court “bears the burden of establishing jurisdiction, but need only present prima facie evidence.”[49] To determine whether a prima facie case exists, a district court accepts “uncontroverted allegations in the complaint” as true and resolves “any factual disputes” in favor of the party seeking to invoke the court's jurisdiction.[50]
In diversity cases under 28 U.S.C. § 1332, “the exercise of personal jurisdiction over a non-resident defendant must comport with both federal constitutional due process requirements and the long-arm statute of the state in which the district court is located.”[51] The Louisiana long-arm statute confers jurisdiction to the limits of due process.[52] Thus, because Louisiana's long-arm statute confers jurisdiction to...
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