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Arlington Industries, Inc v. Electronic Custom Distributors

December 20, 2010

ARLINGTON INDUSTRIES, INC., PLAINTIFF,
v.
ELECTRONIC CUSTOM DISTRIBUTORS, INC., DEFENDANT.



The opinion of the court was delivered by: (judge Caputo)

MEMORANDUM

The defendant, Electronic Custom Distributors (ECD), moves to dismiss this action for lack of personal jurisdiction. (Doc. No. 8.) In response, Arlington Industries moves*fn1 for limited jurisdictional discovery. (Doc. No. 16.) The defendant does not oppose Arlington's motion. Because discovery is warranted, Arlington's motion will be granted and the motion to dismiss will be stayed pending discovery.

I. Background

Arlington Industries, Inc. brought this action against Electronic Custom Distributors, Inc. Arlington seeks a declaratory judgment of non-infringement and invalidity of one of ECD's patents.

ECD moves to dismiss for lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(2) and submits affidavits in support of its motion. Arlington opposes the motion and, in the alternative, moves for jurisdictional discovery. ECD does not object to limited discovery on the jurisdictional issue.

II. Discussion

A. Legal Standard

The law of the Federal Circuit, rather than the regional circuit, controls the issue of personal jurisdiction "over out-of-state patentees as declaratory judgment defendants." Hildebrand v. Steck Mfg. Co, Inc., 279 F.3d 1351, 1354 (Fed. Cir. 2002) (citing Red Wing Shoe Co. v. Hockerson-Halberstadt, Inc., 148 F.3d 1355, 1358 (Fed. Cir. 1998)). When personal jurisdiction is challenged, the plaintiff carries the burden of showing that jurisdiction exists. Iowa State Univ. Research Found., Inc. v. Greater Continents Inc., 81 F. App'x 344, 349 (Fed. Cir. 2003)(citing Burlington Indus., Inc. v. Maples Indus., Inc., 97 F.3d 1100, 1102 (8th Cir. 1996)). In the absence of an evidentiary hearing, a plaintiff need only make a prima facie showing that the defendants are subject to personal jurisdiction. Electronics For Imaging, Inc. v. Coyle, 340 F.3d 1344, 1349 (Fed. Cir. 2003) (internal citations omitted).

Due process requires that an out-of-state defendant "have certain minimum contacts with [the forum] such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.'" International Shoe Co. v. Washington, 326 U.S. 310, 316 (quoting Milliken v. Meyer, 311 U.S. 457, 463 (1945).

Having the requisite minimum contacts with the forum state may subject the defendant to either general jurisdiction or specific jurisdiction. General jurisdiction arises when a defendant has "continuous and systematic" contacts with the forum state, even where the cause of action is unrelated to those contacts. See Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414--16 (1984). By contrast, specific jurisdiction "arises out of" or "relates to" the cause of action when the contacts are "isolated or specific." Burger King, 471 U.S. at 472--73.

Because the issue of whether jurisdictional discovery should be granted is not unique to patent law, the law of the regional circuit governs. See Autogenomics Inc. v. Oxford Gene Tech. Ltd., 556 F.3d 1012, 1021-22 (Fed. Cir. 2009). In the Third Circuit, "[i]f the plaintiff presents factual allegations that suggest 'with reasonable particularity' the possible existence of the requisite 'contacts between [the party] and the forum state,' the plaintiff's right to conduct jurisdictional discovery should be sustained." Eurofins Pharma US Holdings v. BioAlliance Pharma SA, 623 F.3d 147, 157 (modification in original) (quoting Toys "R" Us v. Step Two, S.A., 318 F.3d 446, 455 (3d Cir. 2003)).

B. Jurisdictional Discovery Is Warranted

Here, Arlington argues that there may exist sufficient contacts between ECD and Pennsylvania to support general jurisdiction. Arlington notes that ECD has not provided information about its contacts with Pennsylvania before January 1, 2009.*fn2 Arlington does not allege that any pre-2009 contact with Pennsylvania gave rise to its claim against ECD; therefore Arlington must seek pre-2009 information to establish its case for general jurisdiction.

General jurisdiction only exists if the contacts with the forum are "continuous and systematic." In evaluating whether general jurisdiction exists, courts often look to the period of years prior to the date the complaint is filed. See Metropolitan Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 569 (2d Cir. 1996) (noting that the Supreme Court in Helicopteros assessed the defendant's contacts with the forum state over a seven-year period). Because this lawsuit was filed ...


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