12(b)(2)

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Compliance Software Sol’ns. Corp. v. MODA Tech. Partners, Inc., No. 07 C 6752, 2008 WL 2960711 (N.D. Ill. Jul. 31, 2008) (Manning, J.)
Judge Manning granted defendants’ (collectively “MODA”) Fed. R. Civ. P. 12(b)(2) motion to dismiss for lack of personal jurisdiction. MODA was a Pennsylvania resident, as were its employees. Its alleged Illinois contacts were: 1) attendance at an Illinois trade show, Pittcon, where it demonstrated its software – software that allegedly infringed plaintiff CSSC’s patent and copyright covering CSSC’s environmental monitoring software; and 2) signing a contract with an Illinois choice of law provision.
MODA’s Pittcon attendance did not create specific jurisdiction because MODA just presented its software and tried to generate interest in it. MODA did not sell its software or “use” it. Pittcon attendance, therefore, did not create jurisdiction. Similarly, MODA’s alleged offer to sell its software in Illinois did not create jurisdiction. The offer did not include a price term, a requirement for a legal offer to sell.
Finally, MODA’s execution of a contract governed by Illinois law did not create jurisdiction. While Illinois law governed the contract, it did not include a forum selection clause making Illinois the exclusive forum. Without the exclusive forum selection clause, the contract did not create jurisdiction.
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Continue Reading Trade Show Presentations Do Not Create Jurisdiction Without Price Terms

Medline Indus., Inc. v. Strategic Comm. Sol’ns., No. 07 C 2783, __ F. Supp.2d __, 2008 WL 2091141 (N.D. Ill. May 5, 2008) (Castillo, J.).
Judge Castillo dismissed some defendants for lack of personal jurisdiction (the wrong defendants) and denied defendant Strategic Commercial Solutions (“SCS”). Fed. R. Civ. P. 12(b)(6) motion to dismiss. Plaintiff Medline alleged that defendants violated its trademark and related federal and state laws by selling “Medline Savings” packages with telemarketers.
Personal Jurisdiction
The Court did not have personal jurisdiction over the Wong defendants. The Wong defendants, all individuals, did not direct any of their allegedly infringing and fraudulent calls to Illinois residents. Their only contacts with Illinois were calls to and from Illinois banks regarding processing payments and refunds. These secondary contacts were not sufficient to create personal jurisdiction.
SCS similarly did not have sufficient contacts with Illinois. But Fed. R. Civ. P. 4(K)(2) provided for national, and therefore, there was personal jurisdiction in Illinois because SCS argued it was not subject to jurisdiction in any U.S. state or territory.
Telemarketing and Consumer Fraud and Abuse Act
SCS argued that Medline could not bring its Telemarketing and Consumer Fraud and Abuse Act claim because it was not a “private person” that was “adversely affected” by the telemarketing as required by the Act. But the Court held that while Medline was not an aggrieved consumer, the alleged unfair use of Medline’s trademarks could have caused Medline the harm it alleged.
Trademark Infringement
The Court noted that it was not aware of a similar case in which a party was accused of trademark infringement for using marks in telemarketing. But SCS’s alleged use of Medline’s marks was a use in commerce.
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Continue Reading Using a Trademark in Telemarketing is a Use in Commerce

Hyperquest, Inc. v. Nugen I.T., Inc. and Dayle Phillips, No. 08 C 0485, Slip OP. (N.D. Ill. Jun. 18, 2008) (Norgle, J.)
Judge Norgle dismissed plaintiff’s copyright infringement case for lack of personal jurisdiction, pursuant to Fed. R. Civ. P. 12(b)(2). The Court agreed with plaintiff that the alleged injury was suffered in Illinois because plaintiff was an Illinois resident. But that was not enough to create personal jurisdiction. Plaintiff identified no supported facts showing that defendants intended to impinge upon an Illinois interest or otherwise purposely availed themselves of Illinois.
And the individual defendants’ contract with plaintiff in Illinois did not create personal jurisdiction either. All of the individual defendants’ contracts occurred before the corporate defendant was incorporated. And after incorporation, the defendants did no business in Illinois or with Illinois residents. Defendants did maintain a website, but plaintiff’s evidence regarding the website was insufficient.
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Continue Reading Prior Illinois Contacts do Not Create Jurisdiction

Digisound-WIE, Inc. v. BeStar Techs., Inc., No. 07 C 6535, 2008 WL 2095605 (N.D. Ill. May 16, 2008) (Lindberg, Sen. J.).
Judge Lindberg granted individual defendants Mr. and Ms. Greiling’s Fed. R. Civ. P. 12(b)(2) motion to dismiss for lack of personal jurisdiction. Both Greilings were German citizens and residents. Mr. Greiling was previously Managing Director of plaintiff’s parent company, but no longer held that role. First, the Court held that the Greilings were not amenable to Fed. R. Civ. P. 4(k)(2) nationwide service of process because the Lanham Act, which created federal question jurisdiction in this trade secret misappropriation case, did not provide for nationwide service, as some acts do. As a result, the Greilings’ general contacts with the United States were irrelevant. The issue was whether the Greilings had sufficient minimum contacts with Illinois for specific jurisdiction.
The Court did not have specific jurisdiction over Ms. Greiling because she had no contacts with Illinois. She had never been to or conducted business in Illinois and she had no other attachments to Illinois.
Mr. Greiling was a closer question, but the Court held that it lacked specific jurisdiction over him as well. Mr. Greiling was formerly Managing Director of plaintiff’s parent entity, and plaintiff was an Illinois entity. But Mr. Greiling was no longer employed by plaintiff’s parent. And plaintiff provided no facts indicating that Mr. Greiling had any contacts with Illinois during the time relevant to the case.
The Court also denied plaintiff’s request for jurisdictional discovery. Plaintiff had not made a prima facie case for personal jurisdiction and jurisdictional discovery was not appropriate without the prima facie showing of jurisdiction.
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Continue Reading No Nationwide Service for Lanham Act

Medallion Products, Inc. v. H.C.T.V., Inc., No. 06 C 2597, 2007 WL 3085913 (N.D. Ill. Oct. 18, 2007) (Darrah, J.).
Judge Darrah dismissed defendant Broadcast Arts Group (“BAG”) for lack of personal jurisdiction, but held that the Court had personal jurisdiction over defendant ICC, Woodridge Specialty Products Corp. and an individual defendant (collectively “ICC Defendants”). Plaintiffs argued that BAG’s tortious acts against plaintiffs, all Illinois residents, created personal jurisdiction based upon the effects test doctrine. But the Court held that the alleged tortious acts against were not sufficient for jurisdiction because BAG was a Florida resident and all of its allegedly tortious acts were performed in Florida or Pennsylvania, at the request of non-Illinois residents.
The alleged tortious acts of the ICC Defendants, however, did create personal jurisdiction pursuant to the effects test doctrine. The ICC Defendants allegedly entered an agreement to develop, market and sell a counterfeit pet-stain removal product that was packaged in bottles using plaintiff’s “Urine Gone” logo. The alleged acts and resulting injury would have occurred in Illinois.
The Court also held that plaintiffs met the Fed. R. Civ. P. 8 pleading standards as clarified in Atlantic Corp. v. Twombly, ____ U.S. ____, 127 S. Ct. 1955 (2007). So, the Court denied defendant’s motion to dismiss plaintiffs’ state law claims.
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Continue Reading Jursidictional Effects Test Doctrine Still Requires Some Connection to the Forum

Chicago Architecture Foundation v. Domain Magic LLC, No. 07 C 764, Slip Op. (N.D.Ill. October 12, 2007) (Norgle, J.).
Judge Norgle denied defendant’s Fed. R. Civ. P. 12(b)(2) motion to dismiss for lack of personal jurisdiction. Although defendant was a Florida corporation, defendant’s website – www.chicagoarchitecturefoundation.com – played upon plaintiff Chicago Architecture Foundation’s (“CAF”) name and only included links to other Chicago businesses. The Court, therefore, held that defendant’s website targeted the Northern District creating general personal jurisdiction.
Additionally, as a Fed. R. Civ. P. 37 sanction for failing to answer interrogatory responses as the Court ordered, the Court held that defendant generated revenue from the use of CAF’s trademark.
Practice tip: Answer discovery requests on time and, if you cannot for some reason, at least answer them by the Court ordered deadline.
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Continue Reading Chicago Focused Website Creates Personal Jurisdiction

Canadian Thermal Windows, Inc. v. Magic Window Co., No. 07 C 1784, 2007 WL 2481295 (N.D. Ill. Aug. 27, 2007) (Moran, Sen. J.).
Judge Moran granted defendant’s Fed. R. Civ. P. 12(b)(2) motion to dismiss for lack of personal jurisdiction. Defendant’s business is focused on southeastern Michigan. Defendant’s only connections to Illinois were a passive website, which cannot create jurisdiction, and purchases of certain supplies which were wholly unrelated to defendant’s alleged infringing activities. The Court, therefore, held that it lacked personal jurisdiction. In addition, the Court awarded defendant its attorneys fees and costs for moving to transfer or dismiss the case because plaintiff knew that defendant’s business was localized in southeastern Michigan without any ties to Illinois based on the parties’ ongoing business relationship.
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Continue Reading Defendant Gets Fees Because Plaintiff Knew Court Lacked Jurisdiction

Tillman v. New Line Cinema, No. 05 C 910, 2007 WL 2323302 (N.D. Ill. Aug. 9, 2007) (Kennelly, J.)
Judge Kennelly denied plaintiff’s motion for leave to file a second amended complaint, despite noting that Fed. R. Civ. P. 15A) requires that leave to amend be given “freely.” Plaintiff alleged that defendants collectively had access to his screen play “Kharisma Heart of Gold” about his experience with a sick child requiring heart surgery, stole it, produced it and released it as the movie “John Q.” Plaintiff filed his first complaint pro se alleging copyright infringement. Plaintiff then hired counsel and filed an amended complaint alleging copyright infringement and numerous other tort claims arising out of the alleged theft of plaintiff’s screen play. Various defendants filed motions to dismiss the amended complaint for lack of personal jurisdiction pursuant to Fed. R. Civ. P. 12(b)(2) and for failure to state a claim regarding the non-copyright claims pursuant to Fed. R. Civ. P. 12(b)(6). Plaintiff did not respond to that complaint, but filed a motion for leave to file a second amended complaint. The Court* granted the motion to dismiss the individual defendants for lack of personal jurisdiction and the non-copyright claims against the remaining defendants. The Court also denied plaintiff leave to file its second amended complaint because it was futile. Plaintiff, again proceeding pro se, then sought leave to file a new second amended complaint. But the Court held that plaintiff’s current second amended complaint had no substantive changes from plaintiff’s original second amended complaint. The second amended complaint, therefore, was still futile. Additionally, the second amended complaint attempted to reassert claims against the individual defendants, who had been dismissed from the suit for lack of personal jurisdiction. Because the Court lacked personal jurisdiction, plaintiff could not draw the individual defendants back into the suit.
* The case was originally before Judge Nordberg, who decided the original motions to dismiss and motion for leave to file the second amended complaint, and has since been transferred to Judge Kennelly who heard this motion.
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Continue Reading Amended Complaint Must Have New Substantive Allegations

Varitalk, LLC v. Lahoti, No. 07 C 1771, 2007 WL 1576127 (N.D. Ill. May 30, 2007) (Conlon, J.).
Judge Conlon denied defendant Dave Lahoti’s (“Lahoti”) motion to dismiss plaintiff Varitalk’s complaint for lack of personal jurisdiction pursuant to Fed. R. Civ. P. 12(b)(2), improper venue pursuant to Fed. R. Civ. P. 12(b)(3) and forum non conveniens. Varitalk had a principal place of business in Chicago, where it developed software to relay highly customizable pre-recorded audio messages to consumers that were indistinguishable from live human voice. Varitalk registered a trademark in its name “Varitalk” for use in connection with this business. Lahoti is an individual residing in California where he operates various businesses using websites, such as www.omegaworks.com and www.crosspath.com. Lahoti registered the domain name www.veritalk.com, where he set up an internet portal which allowed visitors to his site to click through links to buy various products or services. The Court held that Lahoti’s website fell in the gray area between active websites (which create specific jurisdiction) and passive websites (which do not create specific jurisdiction). But the portal’s interactive and commercial nature – Lahoti earned income from the site based on how many visitors clicked on links on the site and whether they bought products from the linked sites – combined with Varitalk’s evidence that some consumers were confused and erroneously visited Lahoti’s portal, create specific jurisdiction over Lahoti. On the other hand, Lahoti’s email exchange with Varitalk’s CEO Frederick Lowe, initiated by Lowe, regarding whether Lahoti would sell his portal to Varitalk did not create specific jurisdiction because the exchange was limited and not initiated by Lahoti.
The Court held that venue was proper in Illinois because a substantial part of the events giving rise to the claims occurred in Illinois and because Varitalk alleged that Illinois consumers were confused by Lahoti’s portal.
Finally, the Court dismissed Lahoti’s forum non conveniens argument because the doctrine only applies where the alternative forum is outside the United States or its territories. Where the alternate venue is California, or any other state, the defendant would have to move to transfer venue pursuant to 28 U.S.C. Section 1404(a).
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Continue Reading Portal Website Creates Specific Jurisdiction

Trading Techs. Int’l., Inc. v. GL Consultants, No. 5 C 4120, Slip Op. (N.D. Ill. May 17, 2007) (Gottschall, J.).*
Judge Gottschall denied defendant GL Trade SA’s (“GL SA”) motion to dismiss for lack of personal jurisdiction, with leave to refile after completion of jurisdictional discovery. GL SA is a French company located in Paris. GL SA does not have an office or any assets in Illinois, but it does have a subsidiary, defendant GL Americas, Inc. (“GL Americas”). GL Americas maintains a regional office in Chicago. The Court noted that despite three rounds of briefing on jurisdiction, neither party “provided anything of substance to the court.” Plaintiff Trading Technologies (“TT”) treated GL SA’s subsidiary GL Americas as GL SA, and had not submitted evidence of GL SA’s specific contacts with Illinois. GL SA submitted several declarations, but none sufficiently clarified that GL SA did not have minimum contacts with Illinois. As a result, the Court held that it lacked sufficient evidence to rule upon the motion, and granted TT’s motion for jurisdictional discovery.
After ruling on the motions, the Court continued to offer some of its jurisdictional analysis as a “framework” for the issues the parties should address through the discovery process. First, the Court pointed out that neither party had detailed GL SA’s specific contacts with Illinois. Neither party identified which software products were GL SA products and which were GL Americas products. Furthermore, neither party identified any sales of GL SA or GL Americas products to Illinois consumers. The Court noted that if none of the GL SA products at issue were sold in Illinois, the Court would not have specific jurisdiction over GL SA. And if there were sales to Illinois consumers, discovery was still required to show whether GL SA had a purpose and intent to serve the Illinois market. Finally, the Court noted that TT must make its case for the Court’s jurisdiction over GL SA based upon GL SA’s actions, without imputing GL America’s actions or contacts to GL SA.
*More analysis of opinions from this case and the various related TT cases, can be found in the Blog’s archives.
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Continue Reading Court Lacks Sufficient Evidence to Rule Upon Personal Jurisdiction