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Susan McKnight, Inc. v. United Industries Corp.

United States District Court, W.D. Tennessee, Western Division

July 26, 2017

SUSAN MCKNIGHT, INC., Plaintiff,
v.
UNITED INDUSTRIES CORPORATION, Defendant.

          ORDER CONCERNING DEFENDANT'S MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION

          JON P. McCALLA UNITED STATES DISTRICT COURT JUDGE

         Before the Court is Defendant United Industries Corporation (“United”)'s Motion to Dismiss for Lack of Personal Jurisdiction and to Dismiss Plaintiff's Indirect and Willful Infringement Claims, filed February 13, 2017. (ECF No. 24.) Plaintiff Susan McKnight, Inc. (“McKnight”) filed a response in opposition on March 13, 2017. (ECF No. 29.) Defendant filed a reply on March 27, 2017. (ECF No. 31.)

         For the reasons stated below, the Court GRANTS in part and DENIES in part Defendant's Motion to Dismiss for Lack of Personal Jurisdiction and to Dismiss Plaintiff's Indirect and Willful Infringement Claims (ECF No. 24).

         I. BACKGROUND

         A. Factual Background

         On February 9, 2016, U.S. Patent No. 9, 253, 973, entitled “Crawling Arthropod Intercepting Device and Method (“the '973 Patent”), was issued to Plaintiff Susan McKnight, Inc, a Tennessee corporation with its principal place of business in Tennessee, and Purdue Research Foundation. (Am. Compl., ECF No. 13 ¶¶ 1, 8.) Plaintiff is the owner of the '973 Patent by assignment from Purdue Research Foundation. (Id. ¶ 10.)

         The '973 Patent covers a bed bug intercepting device, placed in proximity to an object where bed bugs travel (e.g., furniture). The device is upstanding, with an exterior that bed bugs can climb, along with two pitfall traps. The first trap is bait-free and slippery, bound to the furniture or object by an inner support leg. The second trap consists of outer and inner receptacles. The inner receptacle traps bed bugs traveling away from the object or furniture, and outer receptacle traps bed bugs traveling towards the object or furniture. ('973 Patent, ECF No. 13-2, col. 11, ll. 17-39 (claim 1); see also id. col. 16, ll. 25-48 (claim 16)).

         On June 30, 2015, U.S. Patent No. 9, 066, 511, entitled “Crawling Arthropod Intercepting Device and Method” (“the '511 Patent”), was issued to Plaintiff and Purdue Research Foundation. (Id. ¶ 6.) The '511 Patent describes the method of catching bed bugs with a device having a liquid-free inner and outer receptacle, by placing the device on the floor under a bed, sofa, or chair. ('511 Patent, ECF No. 13-1 col. 11-12.)

         Defendant United Industries Corporation (“United”), a Delaware corporation with its principal place of business in Missouri, sells and distributes through others in Tennessee and throughout United States bed bug traps called Hot Shot Bed Bug Interceptors. (Id. ¶¶ 2, 13.) The Hot Shot Bed Bug Interceptor utilizes a pitfall trap in a box, which is placed under the desired furniture or object to trap bed bugs. (Id. ¶ 14.)

         On June 30, 2016, Plaintiff sent Defendant a cease and desist letter. (Id. ¶ 16.) On July 11, 2016, Scott Piering responded to the letter, stating that Spectrum Brands (of which Defendant is a part) would respond after review of the matter. (Id. ¶ 17.)

         B. Procedural Background

         On June 30, 2016, Plaintiff filed its Complaint in this action. (ECF No. 1.) Plaintiff alleged that Defendant's Hot Shot Bed Bug Interceptors infringed the '973 Patent, at least as to Claims 1 and 16. (Id. ¶ 13.) Plaintiff sought relief pursuant to 35 U.S.C. §§ 283-85. (Id. at PageIDs 4-5.)

         On October 17, 2016, the parties filed a Joint Motion for Extension of Time for United Industries Corporation to Answer or Otherwise Respond to Complaint and Memorandum in Support thereof. (ECF No. 9.) On October 18, 2016, the Court granted the motion for extension, providing Defendant until December 16, 2016 to file its answer or otherwise respond to the Complaint. (ECF No. 10.)

         On December 13, 2016, Plaintiff filed an Amended Complaint alleging Defendant directly, indirectly, and willfully infringed the both the '973 and '511 Patents. (ECF No. 13.) Plaintiff's Amended Complaint further alleges that even after sending its cease and desist letter, and receiving a response, Defendant continues to infringe the two patents at issue. (Id. ¶ 19.) The Amended Complaint seeks relief pursuant to 35 U.S.C. §§ 271, 283, 284, and 285. (Id. at PageIDs 46-47.)

         On February 13, 2017, Defendant filed three motions: (1) Motion to Dismiss for Improper Venue (ECF No. 22); (2) Motion to Stay Pending the United States Supreme Court's Decision in the TC Heartland Case (ECF No. 23); and (3) Motion to Dismiss for Lack of Personal Jurisdiction and to Dismiss Plaintiff's Indirect and Willful Infringement Claims (ECF No. 24). On March 13, 2017, Plaintiff filed timely responses in opposition to Defendant's three motions. (ECF Nos. 27-29.) On March 27, 2017, Defendant filed timely replies to its motions to dismiss. (ECF Nos. 30-31.)

         On April 14, 2017, the Court entered an Order Denying Defendant's Motion to Dismiss and Order Denying Defendant's Motion to Stay. (ECF No. 32.) The Court specifically denied Defendant's Motion to Dismiss for Improper Venue (ECF No. 22). (Id. at PageID 565.)

         On May 26, 2017, following the Supreme Court's May 22, 2017 ruling in TC Heartland LLC v. Kraft Foods Grp. Brands, LLC, No. 16-341, 137 S.Ct. 1514 (2017), Defendant filed a Motion to Reconsider its Motion to Dismiss for Improper Venue and Motion to Stay. (ECF No. 35.) Plaintiff filed its response in opposition on June 15, 2017. (ECF No. 39.) On May 31, 2017, Defendant filed a “Consent Motion [to] Stay[] All Proceedings Pending the Court's Disposition of Motion to Reconsider Defendant's Motion to Dismiss for Improper Venue.” (ECF No. 36.)

         On June 15, 2017, the Court granted the motion to stay proceedings (ECF No. 37), and on July 7, 2017, granted the motion to reconsider (ECF No. 40). The Court's Order Granting Defendant's Motion for Reconsideration and Order for Supplemental Briefing on Venue further required the parties submit supplemental briefing on the issue of venue following the Supreme Court's recent decision. (ECF No. 40 at PageIDs 605-06.)

         II. LEGAL STANDARDS

         A. Motion to Dismiss for Failure to State a Claim

         Fed. R. Civ. P. 12(b)(6) allows dismissal of a complaint that “fail[s] to state a claim upon which relief can be granted.” As such, a Rule 12(b)(6) motion permits the “defendant to test whether, as a matter of law, the plaintiff is entitled to legal relief even if everything alleged in the complaint is true.” Mayer v. Mylod, 988 F.2d 635, 638 (6th Cir. 1993) (citing Nishiyama v. Dickson Cnty., 814 F.2d 277, 279 (6th Cir. 1987)). A motion to dismiss only tests whether the plaintiff has pleaded a cognizable claim and allows the court to dismiss meritless cases which would waste judicial resources and result in unnecessary discovery. Brown v. City of Memphis, 440 F.Supp.2d 868, 872 (W.D. Tenn. 2006).

         When evaluating a motion to dismiss for failure to state a claim, the court must determine whether the complaint alleges “sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). If a court decides in light of its judicial experience and common sense that the claim is not plausible, the case may be dismissed at the pleading stage. Iqbal, 556 U.S. at 679. The “[f]actual allegations must be enough to raise a right to relief above [a] speculative level.” Ass'n of Cleveland Fire Fighters v. City of Cleveland, 502 F.3d 545, 548 (6th Cir. 2007) (quoting Twombly, 550 U.S. at 555). A claim is plausible on its face if “the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 556). A complaint need not contain detailed factual allegations. However, a plaintiff's “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Id. When deciding a 12(b)(6) motion to dismiss, the court may look to “matters of public record, orders, items appearing in the record of the case and exhibits attached to the complaint” for guidance. Barany-Snyder v. Weiner, 539 F.3d 327, 332 (6th Cir. 2008) (quoting Amini v. Oberlin Coll., 259 F.3d 493, 502 (6th Cir. 2001)).

         B. Motion to Dismiss for Lack of Personal Jurisdiction

         The court must have personal jurisdiction over each asserted claim. SunCoke Energy Inc. v. MAN Ferrostaal Aktiengesellschaft, 563 F.3d 211, 220 (6th Cir. 2009) (White, J., concurring) (“[P]ersonal jurisdiction must be proper as to each claim. . . .”). A federal court looks to the state long-arm statute in which it sits to determine the appropriate limitations on personal jurisdiction, then assesses the exercise of jurisdiction, if any, under due process requirements. Federal Rule of Civil Procedure 4(k)(1)(a); see Aristech Chem. Int'l Ltd. v. Acrylic Fabricators, Ltd., 138 F.3d 624, 627 (6th Cir. 1998); CompuServe, Inc. v. Patterson, 89 F.3d 1257, 1262 (6th Cir. 1996); Bird v. Parsons, 289 F.3d 865, 871 (6th Cir. 2002). The jurisdictional limits of Tennessee law and of the federal constitutional law of due process are identical. Intera Corp. v. Henderson, 428 F.3d 605, 616 (6th Cir. 2005); First Cmty. Bank, N.A. v. First Tennessee Bank, N.A., 489 S.W.3d 369, 384 (Tenn. 2015), cert. denied sub nom. Fitch Ratings, Inc. v. First Cmty. Bank, N.A., 136 S.Ct. 2511, 195 L.Ed.2d 841 (2016); Tenn. Code Ann. § 20-2-223(a).[1] Thus, the Court need only determine whether exercising personal jurisdiction over the defendant is consistent with federal due process requirements. Bridgeport Music, Inc. v. Still N The Water Pub., 327 F.3d 472, 477 (6th Cir. 2003). The due process clause requires that a non-resident defendant have at least “certain minimum contacts with the [forum state] such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.'” Youn v. Track, Inc., 324 F.3d 409, 417 (6th Cir. 2003) (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)).

         “There are two kinds of personal jurisdiction within the Federal Due Process inquiry: (1) general personal jurisdiction, where the suit does not arise from defendant's contacts with the forum state; and (2) specific jurisdiction, where the suit does arise from the defendant's contacts with the forum state.” Conn v. Zakharov, 667 F.3d 705, 712-13 (6th Cir. 2012). General jurisdiction allows a plaintiff to sue a defendant “on any and all claims, ” regardless of the connection (or lack thereof) between the claim and the forum. Maxitrate Tratamento Termico E Controles v. Super Sys., Inc., 617 F.App'x 406, 408 (6th Cir. 2015), cert. denied sub nom. Maxitrate Tratamento Termico E Controles v. Allianz Seguros S.A., 136 S.Ct. 336 (2015) (citing Daimler AG v. Bauman, 134 S.Ct. 746, 769 (2014)). Specific jurisdiction, by contrast, “exposes the defendant to suit in the forum state only on claims that arise out of or relate to a defendant's contacts with the forum.” Kerry Steel, Inc. v. Paragon Indus., Inc., 106 F.3d 147, 149 (6th Cir. 1997). That is, when alleged contacts fall short of being “continuous and systematic, ” those contacts may still support the exercise of specific jurisdiction if they relate to the cause of action. The Sixth Circuit Court of Appeals has set out a three-part test for determining when specific jurisdiction exists:

First, the defendant must purposefully avail [himself] of the privilege of acting in the forum state or causing a consequence in the forum state. Second, the cause of action must arise from the defendant's activities there. Finally, the acts of the defendant or consequences caused by the defendant must have a substantial enough connection with the forum state to make the exercise of jurisdiction over the defendant reasonable.

S. Mach. Co. v. Mohasco, 401 F.2d 374, 381 (6th Cir. 1968);[2] see also Harmer v. Colom, 650 F.App'x 267, 272 (6th Cir. 2016). The Court of Appeals for the Federal Circuit employs the same three-part test in the patent context. AFTG-TG, LLC v. Nuvoton Tech. Corp., 689 F.3d 1358, 1361 (Fed. Cir. 2012).

         When a defendant challenges personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2), “[t]he plaintiff bears the burden of making a prima facie showing of the court's personal jurisdiction over the defendant.” Intera Corp. v. Henderson, 428 F.3d 605, 615 (6th Cir. 2005). A plaintiff “can meet this burden by ‘establishing with reasonable particularity sufficient contacts between [a defendant] and the forum state to support jurisdiction.'” Neogen Corp. v. Neo Gen ...


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