Dakcoll, Inc. v. Grand Central Graphics, Inc.

• Decision Date: 20 January 2005
• Docket Number: Case No. A1-04-126.
• Citation: 352 F.Supp.2d 990
• Parties: DAKCOLL INC., a North Dakota corporation, Plaintiffs, v. GRAND CENTRAL GRAPHICS, INC., d/b/a Grand Slam Designs, and Barbara Geer, Defendants.
• Court: U.S. District Court — District of North Dakota

352 F.Supp.2d 990

DAKCOLL INC., a North Dakota corporation, Plaintiffs, v. GRAND CENTRAL GRAPHICS, INC., d/b/a Grand Slam Designs, and Barbara Geer, Defendants.

Case No. A1-04-126.

United States District Court, D. North Dakota, Southwestern Division.

January 20, 2005.

COPYRIGHT MATERIAL OMITTED

Timothy J. Austin, Bismarck, ND, for Plaintiff.

Tracy A. Kennedy, Zimney Foster, Johnson Dittus & Flaten, Grand Forks, ND, for Defendants.

ORDER GRANTING DEFENDANTS' MOTION TO DISMISS AS TO DEFENDANT BARBARA GEER

HOVLAND, Chief Judge.

Before the Court is the Defendants' Motion to Dismiss¹ filed on November 16, 2004. The Plaintiffs filed a response opposing the motion on December 13, 2004. For the reasons outlined below, the motion is granted as to defendant Barbara Geer.

I. BACKGROUND

The plaintiff, DakColl Inc. d/b/a Dakota Collectibles ("Dakota Collectibles") is a North Dakota corporation with its principal place of business in Bismarck, North Dakota. The defendant, Grand Central Graphics, Inc., is a Minnesota corporation with its principal place of business in Middle River, Minnesota. Grand Central Graphics is the parent company of, and doing business as, Grand Slam Designs, which also operates out of Minnesota (both will be hereinafter referred to as "Grand Central Graphics"). Both companies are directed by, and are under the control of, defendant Barbara Geer. See Complaint, ¶¶ 5-6.

Dakota Collectibles has created artwork in which it owns all copyrights, consisting of designs and patterns used for embroidery purposes. Dakota Collectibles submitted twelve such designs which it has attached and marked as "Exhibit B" to its pleadings. All of the artwork is copyrightable subject matter under the laws of the United States as it is material wholly original with Dakota Collectibles. Dakota Collectibles has registered each of the copyrightable designs as required under federal law making Dakota Collectibles the sole owner of the exclusive rights and privileges to the copyrights. See Complaint, ¶¶ 7-10.

On October 12, 2004, Dakota Collectibles filed an action alleging that the Defendants infringed on its copyrights for embroidery designs, "by copying, distributing, marketing, and/or causing, facilitating, and otherwise contributing to the copying, distributing, and marketing of such embroidery designs." Complaint, ¶ 1. Dakota Collectibles is seeking money damages and permanent injunctive relief.

II. LEGAL DISCUSSION

The Defendants' have filed a Motion to Dismiss for lack of personal jurisdiction and ineffective service of process. In the alternative, the Defendants request a change of venue. The Court will address each in turn.

A. PERSONAL JURISDICTION

The initial inquiry is whether the Court has personal jurisdiction over the Defendants. The Motion to Dismiss was filed pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure for lack of jurisdiction over the party. "To defeat a motion to dismiss for lack of personal jurisdiction, the nonmoving party need only make a prima facie showing of jurisdiction." Epps v. Stewart Information Services Corp., 327 F.3d 642, 647 (8th Cir.2003) (citing Falkirk Min. Co. v. Japan Steel Works, Ltd., 906 F.2d 369, 373 (8th Cir.1990); Watlow Elec. Mfg. v. Patch Rubber Co., 838 F.2d 999, 1000 (8th Cir.1988)). "The plaintiff's prima facie showing must be tested, not by the pleadings alone, but by the affidavits and exhibits presented with the motions and in opposition thereto." Dever v. Hentzen Coatings, Inc., 380 F.3d 1070, 1072 (8th Cir.2004). The party seeking to establish the court's in personam jurisdiction carries the burden of proof, and the burden does not shift to the party challenging jurisdiction. Epps, 327 F.3d 642, 647 (citations omitted).

"A federal court may assume jurisdiction over a foreign defendant only to the extent permitted by the forum state's long-arm statute and by the Due Process Clause of the Constitution." Dakota Indus., Inc. v. Ever Best Ltd., 28 F.3d 910, 915 (8th Cir.1994) (citing Morris v. Barkbuster, Inc., 923 F.2d 1277, 1280 (8th Cir.1991)). As a result, the personal jurisdiction inquiry involves two steps: (1) the court must determine whether the State of North Dakota would accept jurisdiction under the facts of this case; and (2) the court must determine whether the exercise of jurisdiction comports with constitutional due process restrictions. Lakin v. Prudential Securities, Inc., 348 F.3d 704, 706-707 (8th Cir.2003) (citing Sondergard v. Miles, Inc., 985 F.2d 1389, 1392 (8th Cir.1993)). To satisfy the first step of the jurisdictional analysis, the Court will address the relevant North Dakota provisions governing personal jurisdiction over non-resident defendants.

The jurisdiction of North Dakota courts is governed by the North Dakota long-arm statute set forth in Rule 4(b)(2) of the North Dakota Rules of Civil Procedure. The North Dakota Supreme Court has held that Rule 4(b)(2) "authorizes North Dakota courts to exercise jurisdiction over nonresident defendants to the fullest extent permitted by due process...." Hansen v. Scott, 645 N.W.2d 223, 230 (N.D.2002) (citing Auction Effertz, Ltd. v. Schecher, 611 N.W.2d 173 (N.D.2000); Hust v. Northern Log, Inc., 297 N.W.2d 429, 431 (N.D.1980)). The Eighth Circuit has held that when a state construes its long-arm statute to grant jurisdiction to the fullest extent permitted by the Constitution, the two-step analysis collapses into a single question of whether the exercise of personal jurisdiction comports with due process. Oriental Trading Co., Inc. v. Firetti, 236 F.3d 938, 943 (8th Cir.2001); Bell Paper Box, Inc. v. U.S. Kids, Inc., 22 F.3d 816, 818 (8th Cir.1994); see Hansen v. Scott, 645 N.W.2d 223, 232 (N.D.2002).

The Eighth Circuit has explained the requirements of the due process clause as follows:

Due process requires that there be sufficient "minimum contacts" between the nonresident defendant and the forum state such that the "maintenance of the suit does not offend the traditional notions of fair play and substantial justice." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 291-92, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980). Sufficient minimum contacts exist when the "defendant's conduct and connection with the forum state are such that he or she should reasonably anticipate being haled into court there." Id. at 297, 100 S.Ct. 559. In assessing the defendant's reasonable anticipation, "it is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws." Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958). The" `purposeful availment' requirement ensures that a defendant will not be haled into a jurisdiction solely as a result of `random,' `fortuitous,' or `attenuated' contacts or of the `unilateral activity of another party or a third person.'" Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985) (citations omitted). "Jurisdiction is proper, however, where the contacts proximately result from actions by the defendant himself that create a `substantial connection' with the forum State." Id. (emphasis in original).

Stanton v. St. Jude Medical, Inc., 340 F.3d 690, 693 (8th Cir.2003).

There are two categories of minimum contacts with a state that may subject a defendant to jurisdiction in that forum, i.e., general and specific. With respect to general jurisdiction over a defendant, "a court may hear a lawsuit against a defendant who has `continuous and systematic' contacts with the forum state, even if the injuries at issue in the lawsuit did not arise out of the defendant's activities directed at the forum." Dever, 380 F.3d 1070, 1073 (quoting Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 415-16, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984)). A state has specific jurisdiction over a defendant when the suit arises out of, or is related to, the defendant's contacts with the forum state.

Both categories of minimum contacts require some act by which the defendant purposely avails himself or herself of the privilege of conducting activities within the forum state, and thus invokes the benefits and protections of its laws. If a court determines that a defendant has minimum contacts with the forum state, the court must then consider "`whether the assertion of personal jurisdiction would comport with fair play and substantial justice.'" Id. (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985)).

The Eighth Circuit has established a five-part test for measuring minimum contacts for purposes of asserting personal jurisdiction over a defendant: (1) the nature and quality of [a defendant's] contacts with a forum state; (2) the quantity of such contacts; (3) the relation of the cause of action to the contacts; (4) the interest of the forum state in providing a forum for its residents; and (5)[the] convenience of the parties. Dever, 380 F.3d 1070, 1073-74 (citing Burlington Indus., Inc. v. Maples Indus., Inc., 97 F.3d 1100, 1102 (8th Cir.1996)). In determining whether a defendant has sufficient contacts with the forum state to exercise personal jurisdiction, the court must consider all of the contacts in the aggregate and examine the totality of the circumstances. Northrup King Co. v. Compania Productora Semillas Algodoneras, S.A., 51 F.3d 1383, 1388 (8th Cir.1995). The Eighth Circuit affords "significant weight" to the first three factors. When a court is faced with multiple defendants, each defendant's contacts with the forum state must be assessed individually. Calder v. Jones, 465 U.S. 783, 790, 104 S.Ct. 1482, 79 L.Ed.2d 804 (1984).

In the complaint, Dakota Collectibles sets forth several alleged contacts that Grand Central Graphics has with North Dakota:

a.) Defendants regularly promote and sell their goods, in...