Burwood Products v. Marsel Mirror & Glass Products

• Decision Date: 16 April 1979
• Docket Number: No. 78 C 4494.,78 C 4494.
• Parties: BURWOOD PRODUCTS COMPANY, Plaintiff, v. MARSEL MIRROR AND GLASS PRODUCTS, INC. and Marvin Leopold, Defendants.
• Court: U.S. District Court — Northern District of Illinois

468 F. Supp. 1215

BURWOOD PRODUCTS COMPANY, Plaintiff, v. MARSEL MIRROR AND GLASS PRODUCTS, INC. and Marvin Leopold, Defendants.

No. 78 C 4494.

United States District Court, N. D. Illinois, E. D.

April 16, 1979.

Esther O. Kegan, Michael G. Berkman, Jane Shay Lynch, Kegan, Kegan & Berkman, Chicago, Ill., for plaintiff.

Robert V. Jambor, Hugh M. Gilroy, Haight, Hofeldt, Davis & Jambor, Chicago, Ill., James E. Siegel, Lackenbach, Lilling & Siegel, Scarsdale, N. Y., for defendants.

ORDER

BUA, District Judge.

This is an action for copyright infringement. Plaintiff, an Illinois corporation, is the owner of copyright No. Gp. 89622, for a wicker mirror design. The complaint alleges that defendant Marsel Mirror and Glass Products, Inc. (Marsel) has infringed this copyright by producing, displaying and selling certain wicker mirrors. It is further alleged that defendant Leopold is Marsel's president, and plaintiff accordingly seeks to hold Leopold jointly liable. Jurisdiction lies under 28 U.S.C. § 1338(a).

Now before the court is Marsel's motion to dismiss for lack of personal jurisdiction and improper venue, Rule 12(b)(2) & (3), Fed.R.Civ.P., and the motion of defendant Leopold to dismiss for failure to state a claim, Rule 12(b)(6), Fed.R.Civ.P.

In its motion, Marsel contends that it did not have the requisite "minimum contacts" with Illinois needed to sustain jurisdiction over a nonresident corporation. Service of process was had on Marsel in New York, pursuant to the Illinois long-arm statute. Ill.Rev.Stat. ch. 110, § 17. From the complaint and various memoranda submitted by the parties, the following facts appear undisputed. At the July, 1978 National Housewares Exhibition held in Chicago, Marsel displayed its wicker mirror designs numbered 617 and 618. Although the displayed mirrors were only prototypes of later production models, orders for these production models were solicited at the Exhibition. All such orders, however, were taken subject to approval by Marsel's New York office. Subsequent to the Housewares Exhibition, Marsel produced the allegedly infringing mirrors in New York and, in October, 1978, began selling them. On February 2, 1979, plaintiff's national sales manager purchased one of each of Marsel's products, the accused mirrors, at a K-Mart store in Des Plaines, Illinois. At all times herein relevant, Marsel had no telephone, mailing address or bank account in Illinois. Further, except for the booths it rented at the Housewares Exhibition, the defendant had no office, warehouse or other facility in this state. Contempo Merchandising Corporation, an independent contractor, represents Marsel in Illinois. Contempo's primary function is to solicit orders for Marsel, but it has no power to bind the defendant and has received no commission payments for its solicitation efforts.

As was noted previously, service of process was had on Marsel outside of Illinois pursuant to the Illinois long-arm statute.¹ Ill.Rev.Stat. ch. 110, § 17. The legislative intent of the long-arm statute is to exert jurisdiction over nonresident defendants to the fullest extent permissible under the due process clause. Consolidated Laboratories, Inc. v. Shandon Scientific Co., Ltd., 384 F.2d 797, 801 (7th Cir. 1967); Koplin v. Thomas, Haab & Botts, 73 Ill.App.2d 242, 219 N.E.2d 646 (1966); see Nelson v. Miller, 11 Ill.2d 378, 143 N.E.2d 673 (1957). Before jurisdiction can be asserted over a nonresident, however, the "minimum contacts" test of International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945), must be satisfied. The defendant's acts within the forum must be such that "maintenance of the suit does not offend `traditional notions of fair play and substantial justice'." Id. at 316, 66 S.Ct. at 158. Moreover, for personal jurisdiction to lie, the defendant must in some purposeful way invoke the benefits and protections of the forum state's laws. Hanson v. Denckla, 357 U.S. 235, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958); International Shoe Co. v. Washington, supra.

The burden of establishing amenability to process rests with the party asserting the existence of jurisdiction. O'Hare International Bank v. Hampton, 437 F.2d 1173 (7th Cir. 1971); Canvas Fabricators v. W. E. Hooper & Sons, 199 F.2d 485 (7th Cir. 1952); Rohlfing v. Cats Paw Rubber Co., 99 F.Supp. 886 (N.D.Ill.1957). Accordingly, Burwood must establish, primarily through a prima facie showing in its complaint, that it would be proper to assert in personam jurisdiction over the defendants under the instant circumstances.²

In its complaint, plaintiff contends that Marsel, by dealing with the accused mirrors, has violated the Copyright Act of 1976 (the Act). 17 U.S.C. § 101, et seq. Under the Act, holders of copyrighted material are given five fundamental guarantees.³ One such guarantee is the exclusive right to display the copyrighted work publicly. 17 U.S.C. § 106(5). Marsel, by displaying prototypes of the allegedly infringing mirrors at the Housewares Exhibition, has — plaintiff argues — violated this right.⁴

Copyright infringement is properly classified as a tort. Feist v. Young, 138 F.2d 972 (7th Cir. 1943); Screen Gems-Columbia Music, Inc. v. Mark-Fi Records, Inc., 256 F.Supp. 399 (S.D.N.Y.1966). To state an actionable claim based on the tort of displaying a graphic or sculptural work, sufficient facts must be alleged to indicate that a copy of the work was displayed without authorization in a "public" fashion. Burwood, by alleging that Marsel displayed the allegedly infringing mirrors at the Housewares Exhibition, has adequately stated that such a tort occurred.⁵ Moreover, because this tort is alleged to have occurred in Illinois, Marsel may have committed a tortious act in this state, as contemplated by § 17(1)(b) of the long-arm statute.⁶

In addition to the exclusive right of public display, copyright holders enjoy the exclusive right to distribute copies of their work to the public by sale or transfer. 17 U.S.C. § 106(3). Marsel's alleged act of promoting the accused mirrors and its subsequent sale of them, which apparently resulted in a delivery of the mirrors to an Illinois retail outlet, also may constitute a violation of Burwood's exclusive rights under the Act. The defendant, therefore, may have committed a second tort in Illinois.

Under the contemplation test developed in Gray v. American Radiator & Standard Sanitary Corp., 22 Ill.2d 432, 176 N.E.2d 761 (1961), Marsel should have reasonably foreseen that its sale of the accused mirrors ultimately would result in their being distributed and/or resold in Illinois. Marsel actively engaged in the promotion of the mirrors at the Housewares Exhibition in Chicago, knowing full well that many Chicago merchants were present. The defendant, moreover, hired a Chicago-based contractor, Contempo, to be its Illinois merchandising representative. It is quite reasonable to assume, therefore, that Marsel contemplated the accused mirrors might be distributed in Illinois.⁷

In view of the aforementioned facts, this court concludes that Marsel's contacts with Illinois were sufficient to insure that maintenance of this lawsuit would not "offend traditional notions of fair play and substantial justice." Accordingly, the defendant's motion to dismiss for lack of personal jurisdiction and improper venue is denied.

With respect to defendant Leopold, plaintiff has alleged that he has a mailing address in New York which corresponds to that of Marsel and that he is the president of Marsel. The complaint contains nothing more. To adequately state a claim against this defendant, however, far more needs to be presented.

To sustain its burden as to defendant Leopold, Burwood must have alleged facts to indicate that, in his capacity as Marsel's president, the defendant personally participated in the actual infringement or derived financial benefit specifically from it; or that he wilfully used the corporation to carry out a deliberate and knowing infringement; or that he was the dominant influence in the corporation and personally determined the corporate policies which resulted in the infringement; or some combination of the above. Famous Music Corp. v. Bay State Harness Racing & Breeding Assoc., Inc., 423 F.Supp. 341 (D.Mass.1976). This it clearly has not done. This court, therefore, has no alternative but to grant defendant Leopold's motion to dismiss. Accordingly, it is so ordered.

1 The Illinois long-arm s...