ClaimSolution, Inc. v. US Insurance Claim Solutions, Inc.

IN THE UNITED STATES DISTRICT COURT FOR THE

WESTERN DISTRICT OF MISSOURI

WESTERN DIVISION

CLAIMSOLUTION, INC., )

)

Plaintiff, )

)

v. ) No. 4:18-00770-CV-RK

)

)

US INSURANCE CLAIM )

SOLUTIONS, INC., )

)

Defendant. )

ORDER GRANTING DEFENDANT’S MOTION TO DISMISS

Before the Court is Defendant US Insurance Claim Solutions, Inc. (“Defendant”)’s Motion

to Dismiss for Lack of Personal Jurisdiction pursuant to Fed. R. Civ. P. 12(b)(2) (“the Motion”).

(Doc. 9.) The Motion is fully briefed. (Docs. 9-1, 12, 13.) After careful consideration and for the

reasons below, the Motion is GRANTED, and this case is DISMISSED without prejudice.

Background

The Complaint provides the following allegations. ClaimSolution, Inc. (“Plaintiff”) is a

Missouri corporation. Plaintiff provides insurance claims processing and administration services

in connection with both commercial and personal lines of business. (Doc. 1.) Plaintiff also offers

adjusting and appraisal services for insurance companies. Plaintiff is the owner of the trademark

registration for “CLAIMSOLUTION” issued by the United States Patent and Trademark Office

on October 30, 2007, Registration No. 3,324,297. Plaintiff has registered the internet domain name

“www.claimsolution.com” and uses this website to market, advertise, and promote its services.

Defendant is incorporated in and maintains its principal place of business in California.

Defendant assists insured individuals and companies with processing claims in their respective

insurance company. Defendant markets, advertises, and promotes itself to the public as “US Claim

Solutions.” Defendant has registered the internet domain name “www.claimsolutions.net” and

uses the website to market, advertise, and promote its services.

Defendant “currently and continuously uses the trademark CLAIMSOLUTION in

association with the registered goods and services in nationwide commerce and claims an

actionable and protectable interest in the trademark.” (Doc. 1, ¶ 10.) “US Claim Solutions is

confusingly similar to CS’s [Plaintiff] registered trademark CLAIMSOLUTION.’” (Doc. 1, ¶ 17.)

“The similarity has and will cause market confusion.” (Doc. 1, ¶ 18.) On December 17, 2017,

Plaintiff sent a letter to Defendant notifying Defendant that it was infringing on Plaintiff’s

registered trademark and demanded that Defendant cease any further use of the registered

trademark. Defendant continues to use “US Claim Solutions” in connection with its business and

has continued to market and promote its services through its website. Plaintiff alleges the goodwill

and reputation of Plaintiff’s business in connection with the CLAIMSOLUTION trademark is of

significant value, and Plaintiff will suffer irreparable injury should Defendant’s infringement

continue. Plaintiff’s Complaint alleges the following causes of action: trademark infringement

under the Lanham Act, 15 U.S.C. § 1114(1)(A); common law trademark infringement and unfair

competition; and cybersquatting pursuant to 15 U.S.C. § 1125(D).

Plaintiff asserts this Court has personal jurisdiction over Defendant because: (1)

“Defendant has engaged in acts or omissions within the State causing injury, has engaged in acts

or omissions outside this State resulting in injury within this State,” and (2) Defendant “has

otherwise made or established contacts with this State sufficient to permit the exercise of personal

jurisdiction.”

(Doc. 1.)

Legal Standard

I. Fed. R. Civ. P. 12(b)(2)

At issue in the Motion is whether this Court has personal jurisdiction over Defendant. To

survive a motion to dismiss for lack of personal jurisdiction, the plaintiff must allege “sufficient

facts in the complaint to support a reasonable inference that the defendant can be subjected to

jurisdiction in the forum state.” Steinbuch v. Cutler, 518 F.3d 580, 585 (8th Cir. 2008). “[T]he

party asserting [personal] jurisdiction bears the burden of establishing a prima facie case.” Id. A

complaint will be factually deficient if it does not allege sufficient facts upon which jurisdiction

can rest. Dever v. Hentzen Coatings, Inc., 380 F.3d 1070, 1072 (8th Cir. 2004). In ruling on a

motion to dismiss for lack of personal jurisdiction, the court must view the allegations in the

complaint in the light most favorable to the plaintiff. Clockwork IP, LLC v. Clearview Plumbing

& Heating Ltd., 127 F. Supp. 3d 1020, 1025 (E.D. Mo. Aug. 31, 2015).

There are two types of personal jurisdiction, specific and general jurisdiction. Daimler AG

v. Bauman, 571 U.S. 117, 137 (2014).1 General jurisdiction refers to a court’s authority over a

defendant where the case before the court is unrelated to the defendant’s forum activities. Id. at

127. To be subject to general jurisdiction, a corporation’s affiliations with the forum state must

be “so constant and pervasive ‘as to render [it] essential[ly] at home’” in that state. Id. “[W]hen

‘a corporation is neither incorporated nor maintains its principal place of business in a state, mere

contacts, no matter how ‘systematic and continues,’ are extraordinarily unlikely to add up to an

‘exceptional case.’” State ex rel. Norfolk Southern Railway Company v. Dolan, 512 S.W.3d 41,

48 (Mo. banc 2017) (quoting Brown v. Lockheed Martin Corp., 814 F.3d 619, 629 (2nd Cir.

2016)).2

Specific jurisdiction over a nonresident defendant exists if the defendant “has purposefully

directed [its] activities at [forum state] residents in a suit that arises out of or relates to these

activities.” Johnson v. Arden, 614 F.3d 785, 794 (8th Cir. 2010) (quotation marks and citations

omitted). “A federal court may assume jurisdiction over a nonresident defendant only to the extent

permitted by the forum state’s long-arm statute and the Due Process Clause of the Constitution.”

Clockwork IP, LLC, 127 F. Supp. 3d at 1025 (citing Dakota Industries, Inc. v. Ever Best Ltd., 28

F.3d 910, 915 (8th Cir. 1994)). Missouri’s long-arm statute provides,

Any person or firm, whether or not a citizen or resident of this state, or any

corporation, who in person or through an agent does any of the acts enumerated in

this section, thereby submits such person, firm, or corporation, and, if an individual,

his personal representative, to the jurisdiction of the courts of this state as to any

cause of action arising from the doing of such acts: (1) The transaction of any

business within this state; (2) The making of any contract within this state; (3) The

commission of a tortious act within the state; (4) The ownership, use or possession

of any real estate in this state . . . Only causes of action arising from acts

enumerated in this section may be asserted against a defendant in an action in which

jurisdiction over him is based upon this section.

RSMo. § 506.500.

1 The parties do not dispute that the Court has subject matter jurisdiction over this case.

2 “Federal courts ordinarily follow state law in determining the bounds of their jurisdiction over

persons.” Eskenazi v. Rural Cmty. Hosps. of Am., LLC, 2018 U.S. Dist. LEXIS 206859, at *5 (W.D. Mo.

Dec. 7, 2018) (citation omitted). See also Harrison v. GM Co., 2018 U.S. Dist. LEXIS 214041, at *4 (W.D.

Mo. Dec. 20, 2018) (citation omitted) (“[f]ederal courts ordinarily follow state law in determining the

bounds of their jurisdiction over persons”).

Discussion3

I. General Jurisdiction

This Court does not have general jurisdiction over Defendant in Missouri. Defendant is

neither incorporated in nor maintains its principal place of business in Missouri. The Complaint

does not allege facts that could establish that this is “an exceptional case” that would make

Defendant subject to general jurisdiction in Missouri. See Norfolk Southern Railway Company,

512 S.W.3d at 48. Accordingly, Defendant is not subject to general jurisdiction in Missouri. See

Marty v. Dave’s Wholesale Fireworks, 2019 U.S. Dist. LEXIS 25880, at *4 (E.D. Mo. Feb. 19,

2019) (the court did not exercise general jurisdiction over the defendant corporation because the

defendant corporation was not incorporated in or had its principal place of business in Missouri).

II. Specific Jurisdiction

A. Missouri Long-Arm Statute

Plaintiff argues Defendant is subject to personal jurisdiction pursuant to the long-arm

statute because Defendant engaged in extraterritorial tortious conduct in the form of trademark

infringement, unfair competition, and cybersquatting, all of which resulted in injuries to Plaintiff

in Missouri. Plaintiff alleges these tortious acts were completed through Defendant’s website and

Defendant’s general infringement on Plaintiff’s trademark.

“Section 506.500.1(3) confers jurisdiction over nonresidents who commit tortious acts

within the state of Missouri.” Peabody Holding Co. v. Costain Group PLC, 808 F. Supp. 1425,

1433 (E.D. Mo. Dec. 11, 1992). To establish that specific personal jurisdiction is authorized under

the “tortious conduct” provision of the long-arm statute, “[p]laintiffs must show that defendant

3 Defendant supports the Motion with an affidavit from Defendant’s President, Greg Church.

(Doc. 9-1.) Plaintiff argues that, due to the inclusion of this affidavit, the Motion should be treated as a

motion for summary judgment or the Court should exclude the affidavit from consideration. Rule 12(d)

states, “[i]f on a motion for under Rule 12(b)(6) or 12(c), matters outside the pleadings are presented to and

not exclude by the court, the motion must be treated as one for summary judgment.” However, Rule 12(b)

does not apply to Rule 12(b)(2) motions, and therefore, it does not bar consideration of the affidavit or

transform the Motion into a summary judgment motion. See Attwell v. LaSalle National Bank, 607 F.2d

1157, 1161 (5th Cir. 1979) (the language of Rule 12, on conversion of motions, is very express in limiting

its application to 12(b)(6) motions, and a court may consider affidavits for purposes of resolving

jurisdictional disputes); Chromalloy American Corp. v. Elyria Foundry Co., 955 S.W.2d 1, 3 n.3 (Mo. banc

1997) (consideration of affidavits supporting a motion to dismiss for lack of personal jurisdiction is proper

and does not serve to convert the motion to dismiss into a motion for summary judgment). Accordingly,

the Court will consider the affidavit, and this consideration will not transform the Motion into a motion for

summary judgment.

committed a tort in Missouri, [and] that the action caused the plaintiff’s injury.” Bennett v. Rapid

Am. Corp., 816 S.W.2d 677, 678 (Mo. banc 1991) (citing RSMo. § 506.500).

First, Plaintiff argues Defendant’s trademark infringement occurred outside Missouri, but

because its injuries were felt in Missouri, personal jurisdiction is proper pursuant to the long-arm

statute. “A plaintiff may not invoke tortious long-arm jurisdiction consistent with due process

where the non-resident defendant had no contact with Missouri besides the extraterritorial acts

having consequences in Missouri.” Peabody Holding Co. Inc., 808 F. Supp. at 1437. “Instead,

Plaintiffs must present some evidence that Defendant had other contacts with Missouri, and

intentionally aimed their tortious activities at Missouri so their effect would be felt here.”

Clockwork IP, LLC, 127 F. Supp. 3d at 1027.

Here, Plaintiff does not provide any factual support as to how Defendant’s alleged

extraterritorial torts subject Defendant to the Missouri long-arm statute. The Complaint alleges,

“[t]he Court has personal jurisdiction over Defendant because . . . Defendant has engaged in acts

or omissions outside this State resulting in injury within this State and has otherwise made or

established contacts with this State sufficient to permit the exercise of personal jurisdiction.”

(Doc. 1, ¶ 4.) The Complaint’s bare, conclusory allegations are insufficient to subject Defendant

to the long-arm statute. Accordingly, in construing all doubts in favor of Plaintiff, Plaintiff has

not met its burden to show this Court has personal jurisdiction over Defendant pursuant to the

long-arm statute.

Next, Plaintiff argues the Court has specific jurisdiction over Defendant because

Defendant’s website infringes on Plaintiff’s trademark. A party cannot establish specific

jurisdiction using a website that simply provides information. Johnson, 614 F.3d at 796. See also

Sheely v. Gear/Tronics Indus., Inc., 2015 U.S. Dist. LEXIS 109374, at *11 (E.D. Mo. Aug. 19,

2015) (maintenance of a general information with minimal sales from the website is insufficient

to exercise personal jurisdiction over a non-resident defendant”); Marty, 2019 U.S. Dist. LEXIS

25880, at *21 (“although Black Cat’s website was accessible by Missouri residents, it was not

targeted at Missouri residents and Black Cat did nothing more than publish information that was

equally as available to individuals in each of the other 49 states as it was to residents of Missouri”)

(internal quotation marks omitted).

The Supreme Court of Missouri addressed this issue recently in McShane. State ex rel.

PPG Industries, Inc. v. McShane, 560 S.W.3d 888, 891 (Mo. banc 2018) (citation omitted). In

McShane, like in our case, the suit involves an out-of-state defendant and its only ties to Missouri

were representations made on its website. Id. at 891. The representations on the website were not

directed at Missouri consumers. Id. The plaintiff in McShane argues the injuries were felt by the

plaintiff in Missouri, were relied upon by the plaintiff in Missouri, and caused injuries to the

plaintiff in Missouri. Id. at 892. The McShane Court held the website, without more, was

insufficient to confer personal jurisdiction over the defendant in Missouri. Id.

Like McShane, here, Plaintiff does not allege or argue that Defendant’s website targets

Missouri business or specifically solicits web traffic from Missouri. Plaintiff does not allege or

argue that Defendant has contacted or interacted with any Missouri business through its website.

The website is a passive informational vehicle for clients to learn about Defendant’s services and

encourages potential clients to contact Mr. Church personally to initiate a transaction. The website

has never been used to complete or facilitate any transaction in Missouri. A very small percentage

of overall sales is attributable to visitors of the website; the majority of Defendant’s sales are the

result of Mr. Church’s personal network. Defendant’s website provides general information

equally available in all fifty states, and Defendant derives minimal revenue from its website.

Accordingly, Defendant’s contacts with Missouri as a result of its website are insufficient, without

more, to subject Defendant to the long-arm statute.

B. Due Process

Because Defendant’s conduct does not fall within Missouri’s long-arm statute, this Court

does not have personal jurisdiction over Defendant and does not need to address the due process

prong of the two-part test. See McShane, 560 S.W. 3d at 893 (if the defendant’s conduct does not

fall within Missouri’s long-arm statute, the Court does not have personal jurisdiction over the

nonresident defendant).

III. Plaintiff’s Request for Jurisdictional Discovery

In the suggestions in opposition, Plaintiff requests leave to complete jurisdictional

discovery if the Court finds personal jurisdiction over Defendant is lacking. Specifically, Plaintiff

requests “[d]iscovery into the ownership of the website and the extent of services Defendant

performs in the State of Missouri.” (Doc. 12.) Defendant does not address this request.

“Jurisdictional discovery is appropriate where the existing record is inadequate to support

personal jurisdiction, but the plaintiff demonstrates that it can supplement its jurisdictional

allegations through discovery.” 1st Technology, LLC v. Digital Gaming Solutions S.A., 2008 WL

4790347, at *6 (E.D. Mo. Oct. 31, 2008). “Jurisdictional discovery is also appropriate where the

parties dispute the relevant facts surrounding the jurisdictional issue, or where the parties have not

made a satisfactory showing of the relevant facts.” Id. “Jurisdictional discovery is inappropriate

when the plaintiff pushes for jurisdiction based only on bare assertions.” Id. “Where a plaintiff’s

claim of personal jurisdiction appears to be both attenuated and based on bare allegations in the

face of the complaint, the Court need not permit even limited discovery.” Terracom v. Valley Nat’l

Bank, 49 F.3d 555, 562 (9th Cir. 1995) (internal quotation marks and citation omitted). “[W]hen

a plaintiff offers only speculation or conclusory assertion about contacts with a forum state, a court

is within its discretion in denying jurisdictional discovery.” Dever, 380 F.3d at 1074 n.1 (internal

quotation marks and citation omitted).

Here, Plaintiff’s Complaint provides only the following bare conclusory allegations that

personal jurisdiction exists:.

The Court has personal jurisdiction over Defendant because Defendant has engaged

in acts or omissions within the State causing injury, has engaged in acts or

omissions outside this State resulting in injury within this State and has otherwise

made or established contacts with this State sufficient to permit the exercise of

personal jurisdiction. Defendant offers [its] services across 50 states, including

within the state of Missouri.

(Doc. 1, ¶ 4.) Further, Plaintiff has not shown how jurisdictional discovery would supplement

Plaintiff’s jurisdictional allegations. Without more, jurisdictional discovery is inappropriate. See

Clockwork IP, LLC, 127 F. Supp. 3d at 1030 (“[n]umerous cases hold that district courts have the

discretion to deny jurisdictional discovery when, as here, the complaint fails to make a prima facie

case of personal jurisdiction”); Viasystems, Inc. v. EMB-Papst St. Georgen GmbH & Co., KG, 646

F.3d 589, 598 (8th Cir. 2011) (the court found the plaintiff’s allegations that additional discovery

would produce facts indicating the court held jurisdiction over the defendant was entirely

speculative, so jurisdictional discovery was denied).

Conclusion

After careful consideration, the Motion (Doc. 9) is GRANTED, Plaintiff’s request for

jurisdictional discovery is DENIED, and this case is DISMISSED without prejudice.

IT IS SO ORDERED.

s/ Roseann A. Ketchmark

ROSEANN A. KETCHMARK, JUDGE

UNITED STATES DISTRICT COURT

DATED: April 30, 2019