Solta Med., Inc. v. Lumenis, Inc.

• Decision Date: 14 April 2020
• Docket Number: Case No. 19-cv-11600-DJC
• Citation: 454 F.Supp.3d 107
• Parties: SOLTA MEDICAL, INC., Plaintiffs, v. LUMENIS, INC. and Lumenis, Ltd., Defendants.
• Court: U.S. District Court — District of Massachusetts

454 F.Supp.3d 107

SOLTA MEDICAL, INC., Plaintiffs,

v.LUMENIS, INC. and Lumenis, Ltd., Defendants.

Case No. 19-cv-11600-DJC

United States District Court, D. Massachusetts.

Filed April 14, 2020

Ian B. Brooks, Pro Hac Vice, Sarah P. Hogarth, Pro Hac Vice, Thomas P. Steindler, Pro Hac Vice, McDermott Will & Emery LLP, Washington, DC, Katherine Nicole Clouse, McDermott Will & Emery, Boston, MA, for Plaintiffs.

Michael T. Renaud, Mintz, Levin, Cohn, Ferris, Glovsky and Popeo, PC, Boston, MA, Anthony Jason Mirabito, Isus Intellectual Property PLLC, Washington, DC, Philip C. Ducker, Pro Hac Vice, Mintz Levin Cohn Ferris Glovsky & Popeo, P.C., San Francisco, CA, for Defendants.

MEMORANDUM AND ORDER

CASPER, J.

I. Introduction

Plaintiff Solta Medical, Inc. ("Solta") has filed this lawsuit against Defendants Lumenis, Inc. ("Lumenis U.S.") and Lumenis, Ltd. ("Lumenis Israel") (collectively, the "Lumenis Companies") alleging two counts of patent infringement in violation of 35 U.S.C. § 271(a) (Count I and III) and one count of indirect patent infringement in violation of 35 U.S.C. § 271(b) (Count II). D. 1. One of the defendants, Lumenis Israel, has now moved to dismiss for lack of personal jurisdiction. D. 14.¹ For the reasons stated below, the Court DENIES the motion.

II. Standard of Review

In ruling on a motion to dismiss for lack of personal jurisdiction under Fed. R. Civ. P. 12(b)(2) without an evidentiary hearing, a district court must apply the prima facie standard of review. United States v. Swiss Am. Bank, Ltd., 274 F.3d 610, 618 (1st Cir. 2001). Under the prima facie standard, Plaintiffs must "demonstrate the existence of every fact required to satisfy both the forum's long-arm statute and the Due Process Clause of the Constitution." Id. (citing United Elec. Radio and Mach. Workers of Am. v. 163 Pleasant St. Corp., 987 F.2d 39, 44 (1st Cir. 1993) ). The Court considers the facts alleged in the pleadings as well as the parties’ supplemental filings. Sawtelle v. Farrell, 70 F.3d 1381, 1385 (1st Cir. 1995) ; Ticketmaster-N.Y., Inc. v. Alioto, 26 F.3d 201, 203 (1st Cir. 1994). The Court will "take specific facts affirmatively alleged by the plaintiff as true (whether or not disputed) and construe them in the light most congenial to the plaintiff's jurisdictional claim." Mass. Sch. of Law at Andover, Inc. v. Am. Bar Ass'n, 142 F.3d 26, 34 (1st Cir. 1998). In doing so, the Court will "not credit conclusory allegations or draw farfetched inferences." Ticketmaster, 26 F.3d at 203. The Court is also required to "add to the mix facts put forward by the defendants, to the extent that they are uncontradicted." Mass. Sch. of Law, 142 F.3d at 34.

III. Factual Background

The following facts are taken from Solta's complaint, D. 1, Lumenis Israel's uncontroverted, sworn affidavits in support of its motion to dismiss, D. 15-1, Solta's opposition to Lumenis Israel's motion to dismiss, D. 21, and supporting exhibits, D. 22.

Solta is a Delaware corporation with its principal place of business in Hayward, California. D. 1 ¶ 2. Lumenis Israel is an Israeli corporation with its principal place of business in Yokneam, Israel. D. 1 ¶ 4. Lumenis Israel manufactures its surgical and aesthetic products in Israel, D. 22-9 at 44, and then sells its products through its wholly owned subsidiaries in six countries: the United States, China, Japan, India, Germany and Australia. D. 22-9 at 43. Lumenis U.S. is Lumenis Israel's wholly owned subsidiary in the United States. D. 15-1 ¶ 14. Lumenis U.S. is a Massachusetts corporation with its principal place of business in San Jose, California, D. 1 ¶ 3, Massachusetts is one of the states where Lumenis U.S. sells and markets its products, D. 1 ¶ 7.

Solta is the owner of the '594 Patent titled "Tissue Cooling Rod for Laser Surgery," D. 1 ¶ 11, and the '881 Patent titled "Tissue Cooling Rod for Laser Surgery," D. 1 ¶ 13. The '881 Patent is a continuation of the ‘594 Patent. D. 1 ¶ 13. The Lumenis Companies offer to sell and market three devices—M22, AcuPulse and Ultra Pulse—that, as Solta alleges, infringe on Solta's ‘594 and '881 Patents. D. 1 ¶¶ 15, 24, 31, 40, 62. Although the parties disagree as to which Lumenis entity did what in the sale of these products, as discussed further below, the allegedly infringing products—M22, AcuPulse and Ultra Pulse—are specifically identified as Lumenis Israel products in a Lumenis Israel SEC filing. D. 22-9 at 38-42. Lumenis Israel also applied for FDA approval to market the allegedly infringing products in the United States. D. 22-1; D. 22-2; D. 22-3; D. 22-4; D. 22-5; D. 22-6; D. 22-7; D. 22-8.

IV. Procedural History

On July 24, 2019, Solta filed its complaint in this case. D. 1. Lumenis Israel has now moved to dismiss for lack of personal jurisdiction. D. 14. The Court heard oral argument on Lumenis Israel's motion and took the matter under advisement. D. 30.

V. Discussion

A. Personal Jurisdiction

Lumenis Israel asserts that this Court lacks personal jurisdiction over it. D. 15 at 7-16. The parties agree that the Federal Circuit law applies when determining whether a district court may exercise personal jurisdiction over an accused infringer. D. 15 at 7; D. 21 at 5. "In order to establish personal jurisdiction in a patent infringement case over a non-resident defendant whose products are sold in the forum state, a plaintiff must show both that the state longarm statute applies and that the requirements of due process are satisfied." Commissariat a L'Energie Atomique v. Chi Mei Optoelectronics Corp., 395 F.3d 1315, 1319 (Fed. Cir. 2005). This Court's inquiry, therefore, begins with the Massachusetts long arm statute. SCVNGR, Inc. v. Punchh, Inc., 478 Mass. 324, 325, 85 N.E.3d 50 (2017) (explaining that "prior to exercising personal jurisdiction over a nonresident defendant, a judge must determine that doing so comports with both the forum's long-arm statute and the requirements of the United States Constitution"). The Court's analysis of the Massachusetts long-arm statute "precede[s] consideration of the constitutional question" of due process. Id.

1. The Massachusetts Long-Arm Statute

Lumenis Israel in its reply brief argues that Solta has not carried its burden of establishing that this Court has personal jurisdiction pursuant to Massachusetts's long arm statute. D. 25-1 at 6-7. As this argument was raised for the first time in the reply brief, it is waived. See Noonan v. Wonderland Greyhound Park Realty LLC, 723 F. Supp. 2d 298, 349 (D. Mass. 2010) (considering an argument waived when it was raised for the first time in the reply brief); see also Wills v. Brown Univ., 184 F.3d 20, 27 (1st Cir. 1999) (explaining that the purpose of a reply brief is "to counter the [opponent's] arguments, not to offer new theories of error for the first time").

Even assuming this argument is properly before this Court, Lumenis Israel has transacted business within the meaning of the Massachusetts long arm statute. Section 3(a) of the long-arm statute provides for personal jurisdiction "over a person, who acts directly or by an agent, as to a cause of action in law or equity arising from the person's ... transacting any business in this commonwealth." Mass. Gen. L. c. 223A, § 3(a). "[F]or jurisdiction to exist pursuant to § 3(a), therefore, the facts must satisfy two requirements: 1) the defendant must have transacted business in Massachusetts, and 2) the plaintiff's claim must have arisen from the defendant's transaction of such business." Sigros v. Walt Disney World Co., 129 F. Supp. 2d 56, 63 (D. Mass. 2001) (citing Tatro v. Manor Care, Inc., 416 Mass. 763, 767, 625 N.E.2d 549 (1994) ).

The "transacting business" clause is construed "broadly." Shipley Co., Inc. v. Clark, 728 F. Supp. 818, 821 (D. Mass. 1990). For example, courts have interpreted this provision to cover instances in which a defendant engages in "the purposeful and successful solicitation of business from residents of the Commonwealth." Tatro, 416 Mass. at 767, 625 N.E.2d 549. Lumenis Israel argues that it cannot be considered to have transacted business in Massachusetts because "Lumenis Israel does not manufacture, use, sell, or offer to sell any products in Massachusetts or anywhere else in the United States, including the accused products." D. 15 at 6-7. Lumenis Israel contends that it "does not import products into Massachusetts or the United States." D. 15 at 7. Rather, Lumenis Israel asserts, its wholly owned U.S. subsidiary, Lumenis U.S., is responsible for all U.S. activities related to the accused products in this action. Id. In sum, Lumenis Israel asserts that it has no relation to Lumenis U.S.’s actions in Massachusetts and therefore cannot be subject to jurisdiction here. Indeed, ownership of a Massachusetts subsidiary is, on its own, insufficient to assert Massachusetts jurisdiction. See Andresen v. Diorio, 349 F.3d 8, 12 (1st Cir. 2003) (explaining that the fact that a "parent has ‘overall financial and policy control’ over its subsidiary is not enough [to assert jurisdiction under Massachusetts's long arm statute] ... [because] [s]uch control is inherent in ownership and, if overall control were sufficient, every parent would be present wherever a wholly owned subsidiary was present in a state"). The Lumenis Companies need not be in a formal agency relationship to conclude that both are transacting business in the commonwealth for the purposes of § 3(a). See Daynard v. Ness, Motley, Loadholt, Richardson & Poole, P.A., 290 F.3d 42, 45 (1st Cir. 2002) (noting that parties need not be in a formal agency relationship for the contacts in the forum to be attributable to the out of forum party). Moreover, the record controverts the notion that Lumenis Israel's relationship with its U.S. subsidiary is limited to mere ownership.

In an April 2, 2015 20-F filing with the SEC, Lumenis Israel states that it provides "practical basic and advanced technical training and certification of field service engineers for...