stating that discovery is warranted only if the plaintiff “make[s] a 27 ‘colorable’ showing,” which is “less than a prima facie showing,” of “‘some evidence’ 28 tending to establish personal jurisdiction over the defendant”
How later courts described this case
- stating that discovery is warranted only if the plaintiff “make[s] a 27 ‘colorable’ showing,” which is “less than a prima facie showing,” of “‘some evidence’ 28 tending to establish personal jurisdiction over the defendant”
- applying Calder effects test to case involving 14 trademark infringement
- “If the maintenance of an interactive website were sufficient to 18 support general jurisdiction in every forum in which users interacted with the website, ‘the 19 eventual demise of all restrictions on the personal jurisdiction of state courts’ would be the 20 inevitable result.”
Written by the judges who cited it.
The opinion
1
2
3
4
5
6
7
8 UNITED STATES DISTRICT COURT
9 SOUTHERN DISTRICT OF CALIFORNIA
10
11 SPY OPTIC INC., a California Case No.: 3:19-cv-01770-WQH-BLM
Corporation,
12 ORDER
Plaintiff,
13
v.
14
AREATREND, LLC, an Ohio
15 Limited Liability Company; and
DOES 1-10,
16
Defendants.
17
18 HAYES, Judge:
19 The matter pending before the Court is the Motion to Dismiss filed by Defendant
20 AreaTrend, LLC (ECF No. 7).
21 PROCEDURAL BACKGROUND
22 On September 16, 2019, Plaintiff Spy Optic Inc. (“Spy Optic”) initiated this action
23 by filing a Complaint against Defendant AreaTrend, LLC (“AreaTrend”) for (1) federal
24 trademark infringement and counterfeiting; (2) federal false designation of origin; (3)
25 tortious interference with existing contractual relations; (4) California common law
26 trademark infringement; (5) California common law unfair competition; and (6) California
27 statutory unfair competition. (ECF No. 1). On October 24, 2019, Defendant filed a Motion
28 to Dismiss for lack of personal jurisdiction. (ECF No. 7). On November 18, 2019, Plaintiff
1 filed a Response in opposition. (ECF No. 12). On November 19, 2019, Plaintiff filed a
2 Supplemental Declaration in opposition. (ECF No. 13). On November 25, 2019,
3 Defendant filed a Reply. (ECF No. 14).
4 ALLEGATIONS OF THE COMPLAINT
5 Plaintiff engages “in the extensive development, advertising, and marketing of
6 sunglasses, sunglass products, wearing apparel and sporting goods.” (ECF No. 1 at 3).
7 Plaintiff “uses and has used the trademarks ‘SPY’, ‘SPY OPTIC’ and a cross logo, among
8 others, in connection with its goods and/or services” (collectively, “Spy Marks”). Id. The
9 Spy Marks “are valid, subsisting, in full force and effect, and are incontestable pursuant to
10 15 U.S.C. § 1065.” Id. at 4. Plaintiff has “continuously used the S[py] Marks in interstate
11 commerce in connection with the sale, distribution, promotion, and advertising of genuine
12 Spy Optic® products since their respective dates of first use.” Id. “The Spy Marks have
13 never been abandoned.” Id. Plaintiff has “expended substantial time, money, and other
14 resources in developing, advertising, and otherwise promoting the Spy Marks.” Id. The
15 Spy Marks “are widely recognized and exclusively associated by consumers, the public,
16 and the trade as being high-quality products sourced from Spy Optic.” Id. The Spy Marks
17 “have achieved secondary meaning as an identifier of high-quality sunglasses, sunglass
18 products, apparel, and sporting goods.” Id. The Spy Marks “have come to symbolize the
19 enormous goodwill of Spy Optic and its products throughout the United States and the
20 world.” Id. “No other manufacturer lawfully uses the Spy Marks or any marks
21 substantially similar to them in connection with similar types of goods.” Id. Plaintiff
22 “suffers irreparable harm to its goodwill as well as a direct monetary loss any time any
23 third parties, including Defendant, sell counterfeit and infringing goods bearing trademarks
24 identical or substantially indistinguishable from Spy Marks.” Id.
25 “Defendant is an online retailer of various brand-name products including clothing,
26 accessories, and home décor via its website, www.areatrend.com ….” Id. at 5. “Defendant
27 has purchased, advertised, offered for sale, and/or sold eyewear bearing the Spy Marks” on
28 its website, despite not being “an authorized retailer of Spy Optic® branded goods.” Id.
1 [I]t is reasonable to conclude that these goods are either counterfeit,
infringing, obtained from entities who are prohibited from selling said goods
2
to Defendant pursuant to the contractual relationship they have with Plaintiff
3 regarding the distribution of goods as described above, or a combination
thereof.
4
5 Id. Defendant has “received actual notice to cease and desist from its improper acquisition
6 and deceptive promotion and sale of products bearing the Spy Marks ….” Id. at 5-6.
7 Defendant continues to “wrongfully purchase, advertise, promote, offer for sale, and/or
8 sell” eyewear bearing the Spy Optics trademarks “on its website.” Id. at 6.
9 STANDARD OF REVIEW
10 Under Federal Rule of Civil Procedure 12(b)(2), a defendant may move to dismiss a
11 complaint for lack of personal jurisdiction. See Fed. R. Civ. P. 12(b)(2). In opposing a
12 defendant’s Rule 12(b)(2) motion, “the plaintiff bears the burden of establishing that
13 jurisdiction is proper.” Boschetto v. Hansing, 539 F.3d 1011, 1015 (9th Cir. 2008) (citation
14 omitted). Where the court considers the motion without holding an evidentiary hearing,
15 “the plaintiff need only make a prima facie showing of jurisdictional facts to withstand the
16 motion to dismiss.” Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218, 1223 (9th
17 Cir. 2011) (citing Brayton Purcell LLP v. Recordon & Recordon, 606 F.3d 1124, 1127 (9th
18 Cir. 2010), abrogated on other grounds as recognized by Axiom Foods, Inc. v. Acerchem
19 Int’l, Inc., 874 F.3d 1064 (9th Cir. 2017)). “The plaintiff cannot ‘simply rest on the bare
20 allegations of its complaint,’ but uncontroverted allegations in the complaint must be taken
21 as true.” Id. (quoting Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th
22 Cir. 2004)). “[W]e may not assume the truth of allegations in a pleading which are
23 contradicted by affidavit ... but we resolve factual disputes in the plaintiff’s favor.” Id.
24 (alteration in original) (internal quotation marks, quotation, and citation omitted). In other
25 words, “the plaintiff need only demonstrate facts that if true would support jurisdiction
26 over the defendant.” Ballard v. Savage, 65 F.3d 1495, 1498 (9th Cir. 1995) (citation
27 omitted).
28
1 CONTENTIONS OF THE PARTIES
2 Defendant contends that Plaintiff’s Complaint should be dismissed for lack of
3 personal jurisdiction. Defendant contends that the maintenance of an interactive website
4 is insufficient to support general jurisdiction over a foreign defendant. Defendant asserts
5 that it has no employees or offices in California. Defendant asserts that it derives a trivial
6 amount of sales from California. Defendant contends that this Court lacks specific
7 jurisdiction. Defendant contends that it has not purposefully directed activities at
8 California or purposefully availed itself of the privilege of conducting activities in
9 California. Defendant contends that it has no California contacts that could be the but-for
10 cause of Plaintiff’s alleged injury. Defendant contends that the exercise of jurisdiction in
11 California would be constitutionally unreasonable.
12 Plaintiff contends that there is general jurisdiction over Defendant because
13 Defendant operates a highly interactive website through which California consumers can
14 purchase products. Plaintiff contends that there is specific jurisdiction over Defendant.
15 Plaintiff contends that the highly commercial nature of Defendant’s website constitutes
16 purposeful availment. In the alternative, Plaintiff contends that the purposeful availment
17 element is satisfied based on Defendant’s tortious conduct directed at the forum. Plaintiff
18 contends that Defendant committed an intentional act expressly aimed at California causing
19 foreseeable harm to Plaintiff in California by continuing to sell and ship eyewear bearing
20 the Spy Marks to California after receiving a cease and desist letter from Plaintiff. Plaintiff
21 contends that Defendant has failed to meet its burden of showing that the exercise of
22 personal jurisdiction would be unreasonable.
23 DISCUSSION
24 “Federal courts apply state law to determine the bounds of their jurisdiction over a
25 party.” Axiom Foods, 874 F.3d at 1067 (citation omitted). “California authorizes its courts
26 ‘to exercise jurisdiction to the full extent that such exercise comports with due process.’”
27 Id. (citation omitted); see also Cal. Civ. Proc. Code § 410.10 (“A court of this state may
28 exercise jurisdiction on any basis not inconsistent with the Constitution of this state or of
1 the United States.”). “Accordingly, ‘the jurisdictional analyses under [California] state law
2 and federal due process are the same.’” Axiom Foods, 874 F.3d at 1067 (quoting Mavrix
3 Photo, 647 F.3d at 1223) (alteration in original). “There are two forms of personal
4 jurisdiction that a forum state may exercise over a nonresident defendant–general
5 jurisdiction and specified jurisdiction.” Boschetto, 539 F.3d at 1016.
6 1. General Jurisdiction
7 “[A] finding of general jurisdiction permits a defendant to be haled into court in the
8 forum state to answer for any of its activities in the world.” Schwarzenegger, 374 F.3d at
9 801 (citation omitted). The standard for general jurisdiction “is an exacting standard ….”
10 Id. (citation omitted). For general jurisdiction to exist, a defendant’s affiliations with the
11 forum state must be “so ‘continuous and systematic’ as to render them essentially at home
12 in the forum State.” Daimler AG v. Bauman, 571 U.S. 117, 127 (2014) (quoting Goodyear
13 Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011)). To determine whether
14 a nonresident defendant’s contacts are sufficiently substantial, continuous, and systematic,
15 the Court of Appeals considers their “[l]ongevity, continuity, volume, economic impact,
16 physical presence, and integration into the state’s regulatory or economic markets ….”
17 Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163, 1172 (9th Cir. 2006). In the case of
18 a corporation, “[t]he paradigmatic locations where general jurisdiction is appropriate over
19 a corporation are its place of incorporation and its principal place of business.” Ranza v.
20 Nike, Inc., 793 F.3d 1059, 1069 (9th Cir. 2015) (citing Daimler, 571 U.S. at 137). “Only
21 in an ‘exceptional case’ will general jurisdiction be available anywhere else.” Martinez v.
22 Aero Caribbean, 764 F.3d 1062, 1070 (9th Cir. 2014) (quoting Daimler, 571 U.S. at 139
23 n. 19).
24 The Court of Appeals has found that “t[h]e level of interactivity of a nonresident
25 defendant’s website provides limited help in answering the distinct question whether the
26 defendant’s forum contacts are sufficiently substantial, continuous, and systematic to
27 justify general jurisdiction.” Mavrix Photo, 647 F.3d at 1227 (citation omitted).
28 “Interactive websites where a user can exchange information with the host computer … are
1 now extremely common.” CollegeSource, Inc. v. AcademyOne, Inc., 653 F.3d 1066, 1075
2 (9th Cir. 2011) (internal quotation marks and citation omitted). “If the maintenance of an
3 interactive website were sufficient to support general jurisdiction in every forum in which
4 users interacted with the website, ‘the eventual demise of all restrictions on the personal
5 jurisdiction of state courts’ would be the inevitable result.” Id. at 1075-76 (quoting World-
6 Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 294 (1980)).
7 Defendant is “an Ohio limited liability company with its principal place of business
8 located [in] North Canton, OH ….” Kasper Decl. ¶ 3, ECF No. 7-2 at 2. Defendant “is not
9 and never has been registered to do business in California.” Id. ¶ 4, ECF No. 7-2 at 2.
10 Defendant does not have any “executives or employees [who] regularly travel to California
11 for business purposes.” Id. ¶ 5, ECF No. 7-2 at 2. Defendant “does not advertise nor
12 market products in California.” Id. ¶ 6, ECF No. 7-2 at 2. Defendant “does not have any
13 offices, sales representatives, warehouse facilities, suppliers, toll free telephone numbers
14 or other business associations in California.” Id. ¶ 7, ECF No. 7-2 at 2.
15 The “operation of an interactive website—even a ‘highly interactive’ website—does
16 not confer general jurisdiction.” Mavrix Photo, 647 F.3d at 1226; see also CollegeSource,
17 653 F.3d at 1075-76 (“If the maintenance of an interactive website were sufficient to
18 support general jurisdiction in every forum in which users interacted with the website, ‘the
19 eventual demise of all restrictions on the personal jurisdiction of state courts’ would be the
20 inevitable result.”). The Court concludes that Plaintiff has failed to present sufficient
21 evidence to meet the “exacting standard” necessary to establish general jurisdiction.
22 Schwarzenegger, 374 F.3d at 801 (citation omitted).
23 2. Specific Jurisdiction
24 “The inquiry whether a forum State may assert specific jurisdiction over a
25 nonresident defendant ‘focuses on the relationship among the defendant, the forum, and
26 the litigation.’” Axiom Foods, 874 F.3d at 1068 (quoting Walden v. Fiore, 571 U.S. 277,
27 283-84 (2014)). “Two principles animate the ‘defendant-focused’ inquiry.” Id. (quoting
28 Walden, 571 U.S. at 284). “First, the relationship between the nonresident defendant, the
1 forum, and the litigation ‘must arise out of contacts that the defendant himself creates with
2 the forum state.’” Id. (quoting Walden, 571 U.S. at 284) (emphasis in original). “Second,
3 the minimum contacts analysis examines ‘the defendant’s contacts with the forum State
4 itself, not the defendant’s contacts with persons who reside there.’” Id. (quoting Walden,
5 571 U.S. at 285). “It follows that ‘a defendant’s relationship with a plaintiff or third party,
6 standing alone, is an insufficient basis for jurisdiction.’” Id. (quoting Walden, 571 U.S. at
7 286).
8 “In a specific jurisdiction inquiry, we consider the extent of the defendant’s contacts
9 with the forum and the degree to which the plaintiff's suit is related to those contacts.”
10 Yahoo! Inc. v. La Ligue Contre Le Racisme Et L’Antisemitisme, 433 F.3d 1199, 1210 (9th
11 Cir. 2006). “A strong showing on one axis will permit a lesser showing on the other.” Id.
12 “While ‘a single act can support jurisdiction’” in a tort case, “the act must first ‘create[ ] a
13 substantial connection with the forum.’” Axiom Foods, 874 F.3d at 1068. (quoting Burger
14 King Corp. v. Rudzewicz, 471 U.S. 462, 475 n.18 (1985)) (alteration in original) (internal
15 quotation marks omitted). “Put differently, ‘some single or occasional acts related to the
16 forum may not be sufficient to establish jurisdiction if their nature and quality and the
17 circumstances of their commission create only an attenuated affiliation with the forum.’”
18 Id. (quoting Burger King, 471 U.S. at 475 n.18) (internal quotation marks omitted). “A
19 defendant’s ‘random, fortuitous, or attenuated contacts’ will not suffice.” Id. (quoting
20 Walden, 571 U.S. at 286) (internal quotation marks omitted).
21 The Court of Appeals employs a three-prong test to assess whether a defendant’s
22 contacts with the forum state are sufficient to subject it to specific jurisdiction:
23 (1) the defendant must either “purposefully direct his activities” toward the
forum or “purposefully avail[ ] himself of the privileges of conducting
24
activities in the forum”;
25 (2) “the claim must be one which arises out of or relates to the defendant’s
forum-related activities”; and
26
(3) “the exercise of jurisdiction must comport with fair play and substantial
27 justice, i.e., it must be reasonable.”
28
1 Id. (quoting Dole Food Co. v. Watts, 303 F.3d 1104, 1111 (9th Cir. 2002)) (alteration in
2 original). “The plaintiff bears the burden of satisfying the first two prongs of the test.” Id.
3 (quoting Schwarzenegger, 374 F.3d at 802). “If the plaintiff meets that burden, ‘the burden
4 then shifts to the defendant to present a compelling case that the exercise of jurisdiction
5 would not be reasonable.’” Id. at 1068-69 (quoting Burger King, 471 U.S. at 476-78)
6 (internal quotation marks omitted).
7 a. Purposeful Direction
8 For causes of action sounding in tort, the Court of Appeals applies the purposeful
9 direction test, rather than the purposeful availment test, which generally applies to claims
10 arising from a contract. See id. at 1069 (“Where, as here, a case sounds in tort, we employ
11 the purposeful direction test.”). Alleged trademark infringement qualifies as tortious
12 conduct under the Calder effects test. See Rio Properties, Inc. v. Rio Int’l Interlink, 284
13 F.3d 1007, 1019-20 (9th Cir. 2002) (applying Calder effects test to case involving
14 trademark infringement). The purposeful direction test, “often referred to as the ‘effects’
15 test, derives from Calder v. Jones, 465 U.S. 783 … (1984).” Axiom Foods, 874 F.3d at
16 1069 (citation omitted). To satisfy the Calder purposeful direction test, “[t]he defendant
17 must have ‘(1) committed an intentional act, (2) expressly aimed at the forum state, (3)
18 causing harm that the defendant knows is likely to be suffered in the forum state.’” Id.
19 (citation omitted).
20 1) Intentional Act
21 The first prong of the purposeful direction inquiry requires that the defendant
22 committed an intentional act. The Court of Appeals “construe[s] ‘intent’ in the context of
23 the ‘intentional act’ test as referring to an intent to perform an actual, physical act in the
24 real world, rather than an intent to accomplish a result or consequence of that act.”
25 Schwarzenegger, 374 F.3d at 806.
26 Plaintiff alleges that “Defendant has purchased, advertised, offered for sale, and/or
27 sold eyewear bearing the Spy Marks” on its website, despite not being “an authorized
28 retailer of Spy Optic® branded goods.” (ECF No. 1 at 5). Plaintiff alleges that Defendant
1 continues to “wrongfully purchase, advertise, promote, offer for sale, and/or sell” eyewear
2 bearing the Spy Optics trademarks “on its website.” Id. at 6.
3 Plaintiff submitted supporting exhibits of Defendant’s website from November 12,
4 2019 featuring eyewear bearing the Spy Marks (Ex. A to Blakley Decl., ECF No. 12-1 at
5 6-8) and Defendant’s Amazon website from November 18, 2019 featuring eyewear bearing
6 the Spy Marks (Ex. G to Blakley Decl., ECF No. 12-1 at 32-45). Plaintiff submitted a
7 supporting exhibit of Defendant’s website from November 12, 2019 featuring “Add to
8 Cart” and “Buy Now” options, which facilitate customer purchases. (Ex. B to Blakley
9 Decl., ECF No. 12-1 at 10). Plaintiff submitted a supporting exhibit of Defendant’s website
10 from November 12, 2019 featuring the “Contact Us!” webpage, which lists Defendant’s
11 phone numbers, email address, and live chat option. (Ex. C to Blakley Decl., ECF No. 12-
12 1 at 13). Plaintiff submitted a supporting exhibit of Defendant’s website from November
13 12, 2019 featuring the “Sign Up” webpage, which allows customers to create an account
14 with Defendant. (Ex. D to Blakley Decl., ECF No. 12-1 at 16). This constitutes prima
15 facie evidence of intentional acts within the meaning of Calder. The Court finds that
16 Plaintiff has carried the burden to show an intentional act by Defendant. Plaintiff has made
17 a prima facie showing that Defendant advertised and sold eyewear bearing the Spy Marks.
18 Loomis v. Slendertone Distribution, Inc., No. 3:19-cv-854-MMA (KSC), 2019 WL
19 5790136, at *10 (S.D. Cal. Nov. 6, 2019) (“Because Defendants developed, advertised,
20 and sold the product, the Court finds Plaintiff has carried her burden to show an intentional
21 act by Defendant.”). The Court concludes that the first prong of the Calder test is satisfied.
22 2) Express Aiming
23 The second prong of the purposeful direction inquiry is whether the defendant
24 expressly aimed its conduct at the forum state. A plaintiff must demonstrate that California
25 is the “focal point” of both the claims and the harm suffered. Axiom Foods, 874 F.3d at
26 1071 (quoting Walden, 571 U.S. at 287). A plaintiff must prove that “the ‘effects’ caused
27 by the defendants’ [conduct]—i.e., the injury to the plaintiff[] …—connected the
28 defendants’ conduct to California, not just to a plaintiff who lived there.” Walden, 571
1 U.S. at 288 (emphasis in original). The express aim of the defendant must pertain to the
2 forum state, “not the defendant’s contacts with a resident of the forum.” Picot v. Weston,
3 780 F.3d 1206, 1214 (9th Cir. 2015). A plaintiff does not show express aiming if “none of
4 [the] challenged conduct ha[s] anything to do with California itself.” Id. at 1215 (quoting
5 Walden, 571 U.S. at 289). A plaintiff does not demonstrate express aiming by alleging
6 injuries that are “entirely personal to him and would follow him wherever he might choose
7 to live or travel” and are “not tethered to California in any meaningful way.” Id.
8 The Court of Appeals has explained that
9 we have struggled with the question whether tortious conduct on a nationally
accessible website is expressly aimed at any, or all, of the forums in which the
10
website can be viewed…. On the one hand, we have made clear that
11 “maintenance of a passive website alone cannot satisfy the express aiming
prong.” … On the other, we have held that “operating even a passive website
12
in conjunction with ‘something more’—conduct directly targeting the
13 forum—is sufficient.” … In determining whether a nonresident defendant has
done “something more,” we have considered several factors, including the
14
interactivity of the defendant’s website, … the geographic scope of the
15 defendant’s commercial ambitions, … and whether the defendant
“individually targeted” a plaintiff known to be a forum resident ….
16
17 Mavrix Photo, 647 F.3d at 1229 (citations omitted). The Court of Appeals has further
18 explained that
19 We have held that “individualized targeting” satisfies the express aiming
requirement…. In the context of copyright infringement, we have held that a
20
defendant’s “alleged willful infringement of [a plaintiff’s] copyright, and its
21 knowledge of both the existence of the copyright and the forum of the
copyright holder,” established “individualized targeting.” … In Walden, the
22
Supreme Court rejected our conclusion that the defendants’ “knowledge of
23 [the plaintiffs’] ‘strong forum connections,’” plus the “foreseeable harm” the
plaintiffs suffered in the forum, comprised sufficient minimum contacts….
24
The Court found that our approach “impermissibly allow[ed] a plaintiff's
25 contacts with the defendant and forum to drive the jurisdictional analysis.” …
The Court made clear that we must look to the defendant’s “own contacts”
26
with the forum, not to the defendant’s knowledge of a plaintiff’s connections
27 to a forum…. Following Walden, we now hold that while a theory of
individualized targeting may remain relevant to the minimum contacts
28
1 inquiry, it will not, on its own, support the exercise of specific jurisdiction,
absent compliance with what Walden requires.
2
3 Axiom Foods, 874 F.3d at 1069-70 (citations omitted).
4 Plaintiff alleges that it “is incorporated under the laws of the state of California with
5 a principal place of business located [in] … Carlsbad, California ….” (ECF No. 1 at 2).
6 Plaintiff alleges that Defendant “is a limited liability company duly organized and existing
7 under the laws of the State of Ohio with a principal place of business located [in] … North
8 Canton, Ohio ….” Id. Plaintiff alleges that Plaintiff “served Defendant with a cease and
9 desist letter informing Defendant that ‘[a]ll Spy Optic authorized sources are strictly
10 prohibited from transshipping and/or reselling any Spy Optic-branded products to any
11 entity that sells such products’” on December 20, 2018. Id. at 9 (emphasis in original).
12 Plaintiff alleges that “[t]he letter further requested that Defendant cease and desist selling
13 Spy Optic branded products.” Id. Plaintiff alleges that “[d]espite having received actual
14 notice to cease and desist from its improper acquisition and deceptive promotion and sale
15 of products bearing the Spy Marks, Defendant has continued to wrongfully purchase,
16 advertise, promote, offer for sale, and/or sell” eyewear bearing the Spy Optics trademarks
17 “on its website.” Id. at 5-6.
18 In his declaration, Plaintiff’s Counsel states that
19 [Plaintiff] is a corporation organized and existing under the laws of the state
of California with an office and principal place of business in Carlsbad,
20
California.
21
Blakley Decl. ¶ 2, ECF No. 12-1 at 2. In his declaration, Plaintiff’s Vice President of
22
Revenue states that
23
On February 3, 2017 I made two purchases of [eyewear bearing the Spy Optics
24
trademarks] from Areatrend via the Areatrend storefront on Amazon, which
25 were shipped and delivered to me in Carlsbad California.
26
(ECF No. 13 at 2). Plaintiff’s Vice President of Revenue cites to a supporting exhibit of a
27
purchase receipt from February 2, 2017 featuring a February 3, 2017 shipping date; the
28
1 name, description, and price of two items; a Carlsbad, California shipping address; and
2 payment and billing information. Ex. A to Ninegar Decl., ECF No. 13-1 at 2.
3 In his declaration, Plaintiff’s Counsel states that
4 Despite having received actual notice to cease and desist from its improper
acquisition and deceptive promotion and sale of products bearing the Spy
5
Marks, Defendant has continued to wrongfully purchase, advertise, promote,
6 offer for sale, and/or sell [eyewear bearing the Spy Optics trademarks] on its
website.
7
8 Blakley Decl. ¶ 12, ECF No. 12-1 at 4.
9 Plaintiff submitted a supporting exhibit of Plaintiff’s cease and desist letter sent to
10 Defendant on December 20, 2018. Ex. E to Blakley Decl., ECF No. 12-1 at 19-20. The
11 cease and desist letter is addressed to “Defendant’s Chief Executive Officer” from “Brent
12 Blakely of the Blakely Law Group.” Id. at 19. The cease and desist letter states, in relevant
13 part,
14 We are counsel for Spy Optic (“Spy Optic”).… Spy Optic eyewear is being
advertised, offered for sale, and sold on Area Trend’s website which it did not
15
receive directly from Spy Optic. Consequently, it is reasonable to conclude
16 that the unauthorized Spy Optic eyewear sold by Area Trend is either
counterfeit or was obtained from entities who are prohibited from selling said
17
goods to Area Trend pursuant to the contractual relationship they have with
18 Spy Optic regarding the distribution of goods as described above. To the
extent you’re are not already on notice, you are hereby put on notice of Spy
19
Optic’s contractual relationship with its authorized sources, and you will be
20 liable for all damages sustained as a result of further interference with these
contracts. Based on the foregoing, we hereby demand on behalf of Spy Optic
21
that Area Trend:
22 (1) Immediately cease and desist further purchase, advertisement, marketing,
promotion, distribution, offering for sale, and/or sale Spy Optic branded
23
products;
24 (2) Surrender your remaining inventory of Spy Optic branded products to Spy
Optic; and
25
(3) Provide full disclosure, including production of documents, regarding
26 Area Trend’s source for Spy Optic branded products, including information
regarding (a) from whom Area Trend obtained Spy Optic products; (b)
27
amount purchased; (c) amount sold; and (d) amount in current inventory.
28
1 Id. at 19-20. The letterhead lists the following California address for the Blakely Law
2 Group: “1334 PARKVIEW AVENUE, SUITE 280, MANHATTAN BEACH,
3 CALIFORNIA 90266.” Id. at 19.
4 In his declaration, Defendant’s Chief Executive Officer states that
5 I am the Chief Executive Officer of Areatrend, which is an Ohio limited
liability company with its principal place of business located at 7584 Whipple
6
Ave. NW, North Canton, OH 44720. Areatrend is not and never has been
7 registered to do business in California. No executives or employees of
Areatrend regularly travel to California for business purposes. Areatrend does
8
not advertise nor market products in California. Areatrend does not have any
9 offices, sales representatives, warehouse facilities, suppliers, toll free
telephone numbers or other business associations in California. AreaTrend
10
sells products through it own website www.areatrend.com, as well as through
11 third-party online retailers. Areatrend’s website allows a third-party to
purchase a product, but Areatrend does not maintain a mailing list,
12
membership club, or any other method of creating an ongoing relationship
13 with anyone, much less anyone from California. Areatrend’s sales to
California are nominal. Total sales to California of all products Areatrend sells
14
through all channels represent 4.7 % of gross sales. Sales of Spy Optic
15 products to California from all channels represent .0018 % of total sales.
Areatrend does nothing to expressly target the California market.
16
17 Kasper Decl. ¶¶ 3-10, ECF No. 7-2 at 2.
18 In Graco, a trademark infringement case, this Court held that
19 The Court finds that the record contains evidence tending to show that
Defendants’ products were sold to California customers. The record shows
20
that Defendants received a letter regarding infringement and a possible
21 California lawsuit. The record shows that Plaintiff is a Minnesota company
and Defendants conduct their business in Texas. The record shows that
22
Plaintiff hired investigators to purchase and receive the products in California.
23 The record does not show that Defendants’ business is targeted at a California-
specific market or industry.… Plaintiff (a Minnesota company) sending a
24
cease and desist letter to Defendants (based in Texas) regarding infringement
25 and a possible California lawsuit cannot demonstrate express aiming in this
case.
26
27 Graco Minnesota Inc. v. PF Brands, Inc., No. 18-cv-1690-WQH-AGS, 2019 WL 1746580,
28 at *6 (S.D. Cal. Apr. 17, 2019) (citations omitted).
1 In this case, the evidence in the record shows that Plaintiff is a California company
2 and that Defendant is an Ohio company. See Blakley Decl. ¶ 2, ECF No. 12-1 at 2; Kasper
3 Decl. ¶ 3, ECF No. 7-2 at 2. The evidence in the record shows that Defendant sold products
4 to Plaintiff in California. See Blakley Decl. ¶ 13, ECF No. 12-1 at 4; Ex. A to Ninegar
5 Decl., ECF No. 13-1 at 2. The evidence in the record shows that Plaintiff sent a cease and
6 desist letter to Defendant on December 20, 2018. See Ex. E to Blakley Decl., ECF No. 12-
7 1 at 19-20.
8 However, the evidence in the record does not establish that Defendant’s business is
9 targeted at a California-specific market or industry. The record does not show that
10 California is the “focal point” of both the infringement claims and the alleged harm in this
11 case. Axiom Foods, 874 F.3d at 1070-71 (sending a trademark-violating email to 343
12 recipients, including 10 California residents and 55 with California companies, did not
13 expressly aim at California because “[i]t can hardly be said that ‘California [wa]s the focal
14 point both of the [newsletter] and of the harm suffered’”) (second and third alterations in
15 original) (citation omitted). In other cases, district courts have found express aiming
16 because of additional factors, none of which are present in this case. See e.g., Loomis, 2019
17 WL 5790136, at *12 (designating an agent for service of process in California; registering
18 with the California Secretary of State; and placing products “in the hands of California-
19 specific individuals”); Lindora, LLC v. Isagenix Int’l, LLC, 198 F. Supp. 3d 1127, 1139
20 (S.D. Cal. 2016) (selling more products to consumers in California than in any other state;
21 having more associates in California than in any other state; holding training workshops,
22 promotional tours, and annual conferences in California; and maintaining a website
23 “contain[ing] a page directed specifically to California consumers regarding [Defendant]’s
24 compliance with a California consumer protection statute”); Cree, Inc. v. Fastbuy, Inc.,
25 No. CV 18-01802-CJC(ASx), 2018 WL 4850404, at *4 (C.D. Cal. July 16, 2018)
26 (importing goods that Defendant knows are counterfeit into California ports; storing the
27 goods in warehouses throughout California; and distributing those goods to buyers).
28
1 In this case, the only reference to California in Plaintiff’s cease and desist letter is
2 found in the letterhead, which lists a California address for the Blakely Law Group.
3 Defendant’s sale and shipment of two allegedly infringing products to California on
4 February 3, 2017 occurred before Plaintiff’s cease and desist letter was sent on December
5 20, 2018. The Court concludes that the cease and desist letter and the two purchases do
6 not show that the challenged conduct is connected to California. The Court concludes that
7 Plaintiff fails to make a prima facie showing that Defendant engaged in tortious conduct
8 expressly aimed at California. The Court need not determine whether specific personal
9 jurisdiction is lacking for other reasons. See Picot, 780 F.3d at 1215 n.4 (“Because Picot
10 has not established the second prong of our purposeful direction test, we need not address
11 the third prong.”) (citation omitted).
12 3. Jurisdictional Discovery
13 Plaintiff contends that Defendant’s claim that its total sales to California represent
14 only 4.7% of gross sales is misleading. Plaintiff asserts that it would need to perform
15 discovery on Defendant’s sales to California in order to establish the extent of Defendant’s
16 contacts with California. Plaintiff requests leave to conduct jurisdictional discovery.
17 Defendant contends that the Court should deny any request by Plaintiff for jurisdictional
18 discovery because Plaintiff’s allegations of jurisdiction have been denied by Defendant and
19 remain unrebutted.
20 “A court may permit discovery to aid in determining whether it has in personam
21 jurisdiction…. In granting discovery, the trial court is vested with broad discretion ….”
22 Data Disc, Inc. v. Sys. Tech. Assocs., Inc., 557 F.2d 1280, 1285 n.1 (9th Cir. 1977) (citation
23 omitted). “[W]here pertinent facts bearing on the question of jurisdiction are in dispute,
24 discovery should be allowed.” Am. W. Airlines, Inc. v. GPA Group, Ltd., 877 F.2d 793,
25 801 (9th Cir. 1989) (citation omitted); see also Mitan v. Feeney, 497 F. Supp. 2d 1113,
26 1119 (C.D. Cal. 2007) (stating that discovery is warranted only if the plaintiff “make[s] a
27 ‘colorable’ showing,” which is “less than a prima facie showing,” of “‘some evidence’
28 tending to establish personal jurisdiction over the defendant”) (citations omitted).
1 || However, “where a plaintiff's claim of personal jurisdiction appears to be both attenuated
2 based on bare allegations in the face of specific denials made by the defendants, the
3 ||Court need not permit even limited discovery.” Pebble Beach Co. v. Caddy, 453 F.3d
4 |{1151, 1160 (9th Cir. 2006) (citation omitted). A court need not grant discovery based on
5 ||“purely speculative allegations of attenuated jurisdictional contacts.” Getz v. Boeing Co.,
6 F.3d 852, 860 (9th Cir. 2011).
7 In this case, the Court finds that the discovery Plaintiff seeks regarding additional
8 California and other sales information would not change the jurisdictional analysis. See
9 || Adobe Sys. Inc. v. Cardinal Camera & Video Ctr., Inc., No. 15-cv-02991-JST, 2015 WL
10 }/5834135, at *5 (N.D. Cal. Oct. 7, 2015) (stating that “a sale into the forum is not a
11 |}substantial contact where it ‘involved the forum state only because that is where the
12 || purchaser happened to reside.’ ... District courts have extended this principle to cases
13 ||involving multiple sales entering the forum simply because the purchasers happened to live
14 || in the forum’) (citing cases where California sales constituted 10% and 1.6% of total sales
15 not demonstrate purposeful direction). Plaintiff’s “claim of personal jurisdiction
16 appears to be both attenuated and in the face of specific denials” by Defendants. Pebble
17 ||Beach, 453 F.3d at 1160. Plaintiff fails to make a colorable showing of personal
18 || jurisdiction in this case. See Mitan, 497 F. Supp. 2d at 1119. The Court declines to exercise
19 |/its discretion to permit jurisdictional discovery.
20 CONCLUSION
21 IT IS HEREBY ORDERED that the Motion to Dismiss filed by Defendan
22 || AreaTrend, LLC (ECF No. 7) is GRANTED.
23 IT IS FURTHER ORDERED that Plaintiff's request for jurisdictional discovery is
24 || DENIED.
25 The case is dismissed without prejudice.
26 || Dated: April 13, 2020 itt Z. A a
27 Hon. William Q. Hayes
28 United States District Court