Moldflow Corp. v. Simcon, Inc., CIV.A.02-12123-RCL.

• Decision Date: 22 December 2003
• Docket Number: No. CIV.A.02-12123-RCL.,CIV.A.02-12123-RCL.
• Citation: 296 F.Supp.2d 34
• Parties: MOLDFLOW CORPORATION and Moldflow Ireland, Ltd., Plaintiffs v. SIMCON, INC., and Simcon Kunststofftechnische Software, GmbH Defendants.
• Court: U.S. District Court — District of Massachusetts

296 F.Supp.2d 34

MOLDFLOW CORPORATION and Moldflow Ireland, Ltd., Plaintiffs v. SIMCON, INC., and Simcon Kunststofftechnische Software, GmbH Defendants.

No. CIV.A.02-12123-RCL.

United States District Court, D. Massachusetts.

December 22, 2003.

COPYRIGHT MATERIAL OMITTED

Steven M. Bauer, John J. Cotter, Joel E Lehrer, Christopher W. Stamos, Testa, Hurwitz & Thibeault, LLP, Boston, MA, for Moldflow Corporation, Moldflow Ireland, Ltd., Plaintiffs.

Edwin J. Carr, Carr & Liston, Boston, MA, Howard J. Castleman, Murtha Callina LLP, Boston, MA, Ralph W. Selitto, Jr., Paul F. Swift, McCarter & English, Newark, NJ, John C. Wyman, Murtha Cullina, LLP, Boston, MA, for Simcon Kunststofftechnische Software GmbH, Simcon, Inc., Defendants.

MEMORANDUM AND ORDER ON DEFENDANTS' MOTION TO DISMISS

LINDSAY, District Judge.

I. Introduction

The plaintiffs, Moldflow Corp. and Moldflow Ireland, Ltd. (collectively "Moldflow" or the "plaintiffs"), filed suit in this court, alleging patent infringement by the defendants, Simcon, Inc. and Simcon Kunststofftechnische Software GmbH (collectively "Simcon" or the "defendants"). The defendants responded by filing a motion to dismiss the complaint for lack of personal jurisdiction and improper venue. This memorandum and order addresses Simcon's motion to dismiss.

II. Facts and Procedural History

According to the complaint, on August 1, 2000, the United States Patent and Trademark Office issued the patent that has become the subject of this litigation. See Compl. ¶ 7. That patent was assigned the patent number 6,096,088, and entitled "Method for Modelling [sic] Three Dimension Objects and Simulation of Fluid Flow" (the "'088 patent"). See id. The plaintiffs claim that they have exclusive rights to the '088 patent in the United States, including the right to enforce it. See id. The plaintiffs further claim that, without authorization, Simcon has "made, used, imported, sold, and/or offered for sale" in the United States, including in this district, simulation software products that infringed the '088 patent. See id. ¶¶ 12, 16. Accordingly, the plaintiffs seek a declaratory judgment, injunctive relief, and damages against Simcon. See id.

In support of their motion to dismiss for lack of personal jurisdiction, the defendants have submitted an affidavit executed by Dr. Paul Filz, the Managing Director of Simcon Kunststofftechnische Software GmbH, and President, Treasurer and Secretary of Simcon, Inc. See Memorandum of Law in Support of Motion to Dismiss, Ex. A ("Filz Aff."). In that affidavit, Dr. Filz states that "Simcon has no offices, no representatives, no realty, no personalty, no bank accounts, no presence whatsoever in the Commonwealth of Massachusetts." Filz Aff. ¶ 8. In addition, he asserts that "Simcon is not registered to do business in the Commonwealth of Massachusetts, and based upon [a] review [of its invoice files], has not transacted business in the Commonwealth of Massachusetts, nor sold any products or services to any person or entity in the Commonwealth of Massachusetts since at least January 1997." Id. ¶ 10. Finally, while admitting that Simcon recently retained the services of a Connecticut company called Kruse Analysis to do "limited marketing by mail and/or email," Dr. Filz concludes that, "[t]o my knowledge, no products or services originating from Simcon have reached the Commonwealth of Massachusetts, including the [allegedly infringing] products identified above." Id. ¶ 11.

In their opposition to the motion to dismiss, the defendants challenge Dr. Filz's claim that none of Simcon's allegedly infringing activities occurred in Massachusetts. See Plaintiffs' Opposition to Defendants' Motion to Dismiss Plaintiffs' Complaint ("Plaintiffs' Opposition"). To support that challenge, the defendants proffer the affidavit of Glenn Longwell, Moldflow's Regional Sales Manager for the geographic area that includes Massachusetts. See Plaintiffs' Opposition, Ex. A ("Longwell Aff."). In that affidavit, Mr. Longwell relates a conversation he had with Brian Zajas, see Longwell Aff. ¶¶ 6-7, an employee of Nypro, Inc., one of Moldflow's Massachusetts customers. See id. Mr. Longwell claims that, during a visit to Nypro on or about October 22, 2002, Mr. Zajas told him that Torsten Kruse from Kruse Analysis had contacted Nypro by telephone and through direct mailings earlier in that month. See id. According to the affidavit, Mr. Zajas also told Mr. Longwell that "Mr. Kruse solicited business from Nypro on behalf of Simcon, specifically offering for sale the [allegedly infringing] products." Id. ¶ 8. As evidence of Simcon's solicitations, Mr. Zajas "provided copies of three brochures that were received by Nypro on or about the 1st of October, 2002 from Mr. Kruse." Id. ¶ 9. Mr. Longwell attached photocopies of those brochures to his affidavit. See Longwell Aff., Exs. 1-3. The plaintiffs argue that these contacts with Massachusetts are sufficient to support personal jurisdiction over the defendants.

On June 26, 2003, I ordered expedited discovery on the limited issue of whether this court could exercise personal jurisdiction over Simcon. In accordance with that order, discovery proceeded. As a result of their discovery efforts, the plaintiffs have unearthed two additional pieces of information concerning Simcon's presence in Massachusetts.

First, invoices produced by Simcon and the deposition testimony of Dr. Filz show that, during the past ten years, Simcon has made at least two sales of its products and/or services to customers in the Commonwealth of Massachusetts. See Plaintiffs' Second Opposition to Defendants' Motion to Dismiss Plaintiffs' Complaint ("Plaintiffs' Second Opposition"), Ex. A ("Filz Dep."). It appears from information contained in an invoice that one of those sales, to Tyco Healthcare in Mansfield, Massachusetts, included the provision of data generated through the use of one of Simcon's allegedly infringing software programs. See Filz Dep., Ex. 9. Dr. Filz testified at his deposition, however, that the invoice is in error, and that the data were actually compiled through the use of modeling software in the public domain. See id. at 165:9—167:21. The other sale, to GE Plastics in Pittsfield, Massachusetts, occurred in 1994, six years before the issuance of the '088 patent. See id. at 30:1-14.

Second, the defendants obtained an affidavit from Mr. Kruse, who confirmed therein that Kruse Analysis contacted Nypro by means of email and direct mail, as part of "preliminary marketing efforts" to solicit business on behalf of Simcon in connection with its allegedly infringing software products. See Plaintiffs' Second Opposition, Ex. D ("Kruse Aff."). Moreover, Mr. Kruse declared that "[a]s part of my preliminary marketing efforts, I also emailed and mailed flyers to [] ten [additional] Massachusetts companies." Kruse Aff. ¶ 10. He stated that, in total, Kruse Analysis "sent out these preliminary marketing materials to at least 200 (two hundred) companies in the United States and Canada during 2002." Id. ¶ 11. According to Mr. Kruse's affidavit, Kruse Analysis continued its marketing efforts on behalf of Simcon until October 31, 2002, when Dr. Filz of Simcon telephoned Mr. Kruse and instructed him to cease marketing Simcon's software products. See id. ¶ 12.

The defendants argue that none of the information proffered by the plaintiffs establishes contacts in Massachusetts sufficient to confer personal jurisdiction over Simcon in this district. See Defendants' Response to Plaintiffs' Second Opposition to Motion to Dismiss.

III. Discussion

(a) Burden of Proof

When a defendant moves to dismiss an action for lack of in personam jurisdiction under Federal Rule of Civil Procedure 12(b)(2), "[t]he plaintiff bears the burden of proving the court's personal jurisdiction over the defendant." Daynard v. Ness, Motley, Loadholt, Richardson & Poole, P.A., 290 F.3d 42, 50 (1st Cir.2002). In determining whether the plaintiff has met its burden, the court has three different methods at its disposal. See Foster-Miller, Inc. v. Babcock & Wilcox Canada, 46 F.3d 138, 145 (1st Cir.1995); Boit v. GarTec, 967 F.2d 671, 675-78 (1st Cir.1992).

Under the first of these methods, known as the "prima facie" test, the district court "consider[s] only whether the plaintiff has proffered evidence that, if credited, is enough to support findings of all facts essential to personal jurisdiction." Boit, 967 F.2d at 675; see also U.S. v. Swiss American Bank, Ltd., 274 F.3d 610, 618-19 (1st Cir.2001). The second method, referred to by the First Circuit as the "preponderance of the evidence" test, places a much higher evidentiary burden on the plaintiff. See Foster-Miller, 46 F.3d at 145. Use of that test "necessitates a full-blown evidentiary hearing at which the court will adjudicate the jurisdictional issue definitively before the case reaches trial." Id. at 146. The third method, which the First Circuit has labeled the "likelihood" standard, permits the court to steer a middle course between the "prima facie" and "preponderance of the evidence" tests. See Boit, 967 F.2d at 677. Like the "preponderance of the evidence" test, the "likelihood" test requires the court to conduct an evidentiary hearing and engage in differential factfinding. See id. However, because factual determinations under this intermediate approach are "limited to probable outcomes as opposed to definitive findings of fact," the "likelihood" standard avoids binding adjudications and allows the court to "`merely find whether the plaintiff has shown a likelihood of the existence of each fact necessary to support personal jurisdiction.'" Foster-Miller, 46 F.3d at 146 (quoting Boit, 967 F.2d at 677).

The "prima facie" test is "the most commonly used method of determining a motion to dismiss for want of personal jurisdiction ...," Boit, 967 F.2d at 675, and the default standard for judging whether a plaintiff has met its burden. See id. at...