Larada Scis., Inc. v. Skinner
| Decision Date | 02 December 2015 |
| Docket Number | Case No. 2:15–cv–0399–JNP |
| Citation | 147 F.Supp.3d 1336 |
| Parties | Larada Sciences, Inc., and University of Utah Research Foundation, Plaintiffs, v. Pam Skinner d/b/a Professional Lice Solutions; Picky Pam at the Beach, LLC; Picky Pam of San Diego, LLC; Marcy McQuillan d/b/a Nitless Noggins ; and Uku, Inc. d/b/a Nitless Noggins Headlice Treatment Center; and XPower Manufacture, Inc., Defendants. |
| Court | U.S. District Court — District of Utah |
Emily L. Wegener, Jackie Bosshardt, Jason D. Boren, Mark R. Gaylord, Ballard Spahr LLP, Salt Lake City, UT, Lawrence K. Nodine, Richard W. Miller, Ballard Spahr LLP, Atlanta, GA, Tyler R. Marandola, Ballard Spahr LLP, Philadelphia, PA, for Plaintiffs.
Andrew A. Hufford, H. Dickson Burton, Traskbritt PC, Joseph P. Barrett, Barrett Law, Salt Lake City, UT, Thomas C. Richardson, Rutan & Tucker LLP, Costa Mesa, CA, Robert W. Payne, Payne IP Law, San Jose, CA, for Defendants.
Before the court is Defendant Picky Pam at the Beach, LLC's (“Picky Pam”) Motion to Dismiss for Lack of Personal Jurisdiction and Improper Venue. (Docket 48). In response to the patent infringement action brought by Plaintiffs Larada Sciences, Inc. and the University of Utah Research Foundation (collectively “Larada”), Picky Pam argues that it lacks the minimum contacts in Utah required for this court to exercise general or specific personal jurisdiction. In the alternative, Picky Pam argues that venue is improper. For the reasons stated below, the court GRANTS Defendant Picky Pam's motion to dismiss.
Larada alleges that Picky Pam infringed on Larada's patents U.S. 7,789,902
and U.S. 8,162,999 (the “Patents”). Picky Pam is a small lice treatment center organized under the laws of California, with its principal place of business in Huntington Beach, California. As part of its lice treatment business, Picky Pam offers a heat treatment designed to eradicate lice. It also sells the product used to administer these treatments, the “Dehydration Station,” with sales totaling approximately twenty units to date.
Picky Pam has never owned or leased property, had a bank account, paid taxes, appointed an agent for service of process, solicited business, advertised by non-internet methods, or otherwise promoted its products in Utah. Picky Pam operates a website, accessible from any state, which describes, states the price for, and has promotional videos encouraging website visitors to purchase the Dehydration Station. Although users are currently unable to purchase the product through Picky Pam's website, Larada alleges that the website previously did so. Picky Pam's only sale to Utah occurred when, at Larada's request, it sold and shipped a Dehydration Station to Larada's headquarters so that Larada could evaluate whether the product infringed the Patents. While the parties dispute whether the sale was transacted through Picky Pam's website or via email, the terms and timing of the sale were at least partially negotiated by the parties' attorneys.
Prior to the organization of Picky Pam, Pam Skinner, now president of Picky Pam, entered into a rental agreement (the “Agreement”) with Larada either in her individual capacity or on behalf of a company called Bernadette's at the Beach.1 The Agreement provided for the lease of a machine that incorporated the patented methods. It contained a forum selection and choice of law provision for disputes arising from the Agreement stating that Utah law controlled and that jurisdiction and venue were proper in Utah. The Agreement also prohibited Ms. Skinner from copying the product, even after the termination of the Agreement. As part of the Agreement, Ms. Skinner received training on how to operate the device according to Larada's proprietary methods.
In November 2013, Ms. Skinner terminated the Agreement. In early 2014, Ms. Skinner began offering heat treatments to eradicate lice under the name Picky Pam at the Beach. However, Picky Pam was not formally organized as an LLC until December, 2014. Believing that the heat treatments infringed on the Patents, Larada sent Ms. Skinner a cease and desist letter in April of 2014, which she promptly signed.
Ms. Skinner then began to sell a product called the “Lice Device.” Larada again claimed infringement and asserted that in March 2015, when it tested the product in the presence of Picky Pam's attorney, the attorney abruptly ended the tests and the Lice Device website was taken down soon thereafter. Subsequently, Picky Pam allegedly modified the device, creating a new product called the Dehydration Station, so that it did not operate within the temperature ranges covered by the Patents. Picky Pam notified Larada that it had tested the Dehydration Station and intended to sell it. At that point, Larada and Picky Pam completed the sale described above. As a result of its evaluation, Larada concluded that the product operated within the temperature range covered by the Patents. This litigation followed.
Where, as here, the parties have not conducted discovery or participated in an evidentiary hearing,2 “the plaintiff need[ ] ‘only ... make a prima facie showing’ that the defendants [are] subject to personal jurisdiction.” Silent Drive, Inc. v. Strong Indus., Inc., 326 F.3d 1194, 1201 (Fed.Cir.2003)
(quoting Deprenyl Animal Health, Inc. v. Univ. of Toronto Innovations Found., 297 F.3d 1343, 1347 (Fed.Cir.2002) ). As with any 12(b)(2) motion, the court construes all well-pled factual allegations in the light most favorable to the plaintiffs. Graphic Controls Corp. v. Utah Med. Prods., Inc., 149 F.3d 1382, 1383 n. 1 (Fed.Cir.1998).
, effective service of process establishes personal jurisdiction over a defendant “who is subject to the jurisdiction of a court of general jurisdiction in the state where the district court is located.” Fed. R. Civ. P. 4(k)(1)(A). Accordingly, the court first considers whether the Utah long-arm statute authorizes personal jurisdiction over Picky Pam.
The Utah Supreme Court has interpreted the Utah long-arm statute as extending personal jurisdiction to the maximum extent allowed by the Due Process Clause of the United States Constitution. Starways, Inc. v. Curry, 980 P.2d 204, 206 (Utah 1999)
. Thus, the court conducts a collapsed due process inquiry—if Picky Pam's contacts with Utah are such that due process is satisfied, personal jurisdiction is appropriate.
Because all of the claims in this case involve patent infringement, the Court applies the Federal Circuit's due process analysis. 3D Sys., Inc. v. Aarotech Labs., Inc., 160 F.3d 1373, 1377 (Fed.Cir.1998)
(). The court therefore begins by considering whether Picky Pam's contacts with Utah give rise to either general personal jurisdiction or specific personal jurisdiction.
A court may exercise general jurisdiction over a defendant when the defendant's contacts with the forum are “so ‘continuous and systematic’ ” that the defendant is “essentially at home in the forum State.” Daimler AG v. Bauman, 564 U.S. 915, 134 S.Ct. 746, 754, 187 L.Ed.2d 624 (2014) (quoting Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 131 S.Ct. 2846, 2851, 180 L.Ed.2d 796 (2011)
). Here, the parties agree that Picky Pam does not have contacts in Utah sufficient to give rise to general personal jurisdiction. The court therefore confines its inquiry to whether Picky Pam is subject to specific personal jurisdiction in Utah.
The Federal Circuit applies a three-part test to determine whether specific jurisdiction exists. A defendant will be subject to specific personal jurisdiction only when (1) a defendant has the requisite minimum contacts in the forum established by purposeful direction toward the forum, (2) the plaintiff's claims “arise[ ] out of or relate[ ] to the defendant's activities with the forum,” and (3) the exercise of jurisdiction is reasonable and consistent with traditional notions of fair play and substantial justice. Silent Drive, 326 F.3d at 1201–02
(quoting Inamed Corp. v. Kuzmak, 249 F.3d 1356, 1360 (Fed.Cir.2001) ).
The minimum contacts test guarantees that out-of-state defendants receive “fair warning” that they may be subject to suit in a foreign forum. The test is met where the “quality and nature” of the defendant's contacts demonstrate that she purposefully directed her activities toward the forum State and it is foreseeable that she will be haled into the forum's courts as a result of those activities. Int'l Shoe Co. v. Washington, 326 U.S. 310, 319, 66 S.Ct. 154, 90 L.Ed. 95 (1945)
. “[I]t 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). This purposeful direction requirement “ensures that a defendant will not be haled into a jurisdiction solely as a result of random, fortuitous, or attenuated contacts.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985) (citations omitted). Although a single act may be sufficient to demonstrate purposeful availment, the unilateral acts of a third party are not. McGee v. Int'l Life Ins. Co., 355 U.S. 220, 223, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957) ; Hanson , 357 U.S. at 253, 78 S.Ct. 1228 ; Red Wing Shoe Co. v. Hockerson–Halberstadt, Inc. , 148...
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...personal jurisdiction over acorporation based on contacts with the forum before the corporation existed. See Larada Scis., Inc. v. Skinner, 147 F. Supp. 3d 1336, 1348 (D. Utah 2015) (finding no personal jurisdiction over corporation based on contract signed by principal of corporation "befo......
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...and Wilding cite involves a website hosting infringing content that is located in the forum state. In Larada Sciences, Inc. v. Skinner , 147 F. Supp. 3d 1336, 1339 (D. Utah 2015), the court found that it lacked personal jurisdiction over a California defendant that operated a website that w......
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