Micron Technology, Inc. v. United Microelectronics Corporation et al, No. 3:2017cv06932 - Document 139 (N.D. Cal. 2019)
Court Description: ORDER GRANTING JINHUA'S MOTION TO DISMISS; AFFORDING PLAINTIFF LEAVE TO AMEND. The complaint, to the extent asserted against Jinhua, is dismissed. Micron's request for leave to amend is granted, and Micron shall file any amended complaint no later than February 8, 2019. Signed by Judge Maxine M. Chesney on January 18, 2019. (mmclc1, COURT STAFF) (Filed on 1/18/2019)
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1 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE NORTHERN DISTRICT OF CALIFORNIA 8 9 MICRON TECHNOLOGY, INC., Plaintiff, 10 v. United States District Court Northern District of California 11 12 UNITED MICROELECTRONICS CORPORATION, et al., 13 Case No. 17-cv-06932-MMC ORDER GRANTING JINHUA'S MOTION TO DISMISS; AFFORDING PLAINTIFF LEAVE TO FILE AMENDED COMPLAINT Re: Dkt. No. 106 Defendants. 14 15 Before the Court is defendant Fujian Jinhua Integrated Circuit Co., Ltd.'s ("Jinhua") 16 "Motion to Dismiss for Insufficient Process and for Lack of Personal Jurisdiction," filed 17 October 2, 2018. Plaintiff Micron Technology, Inc. ("Micron") has filed opposition, to 18 which Jinhua has replied. Having read and considered the papers filed in support of and 19 in opposition to the motion, the Court rules as follows.1 BACKGROUND 20 21 In its complaint, Micron alleges it is a "semiconductor-producing compan[y]" with a 22 "portfolio of high performance memory technologies" including "Dynamic Random Access 23 Memory ('DRAM') integrated circuits" (see Compl. ¶¶ 1, 4, 5), that defendant United 24 Microelectronics Corporation ("UMC") is a "semiconductor foundry" (see Compl. 25 ¶ 2), and that Jinhua is a "company founded in Mainland China" that "plans to be in 26 27 28 1 By order filed November 20, 2018, the Court took Jinhua's motion under submission and deferred ruling thereon until December 10, 2018, to afford Micron an additional opportunity to effectuate service. United States District Court Northern District of California 1 commercial DRAM production" (see Compl. ¶ 8). 2 According to Micron, UMC and Jinhua "executed a deal," under which UMC, 3 although it "lack[ed] any significant, independent intellectual property in advanced DRAM 4 technology," would "provide Jinhua with DRAM process technology and enable Jinhua to 5 become a leading force in the DRAM business." (See Compl. ¶ 2.) Micron alleges that 6 UMC and Jinhua "developed and set in motion a plan for UMC to recruit key personnel 7 from Micron's Taiwanese affiliate," Micron Memory Taiwan Co., Ltd. ("MMT"'). (See 8 Compl. ¶ 2.a.) In particular, Micron alleges that "UMC and Jinhua conspired to induce 9 former MMT employees to misappropriate electronic and paper files containing Micron 10 trade secrets from MMT and to deliver those trade secrets to UMC" (see Compl. 11 ¶ 2.b), that UCM then "recruit[ed] various MMT personnel with access to Micron trade 12 secrets" (see Compl. ¶ 25), that two MMT employees, prior to resigning from MMT and 13 beginning employment with UMC, took from Micron trade secrets at the "direct[ion]" of 14 UMC (see Compl. ¶¶ 10-12), and that UMC "incorporated Micron's trade secrets into 15 technologies that it transferred and/or plans to transfer to Jinhua" (see Compl. ¶ 2.c). 16 Based on the above allegations, Micron alleges against UMC and Jinhua the 17 following four causes of action: (1) Count I, titled "Misappropriation of Trade Secrets 18 Under the Defend Trade Secrets Act[,] 18 U.S.C. § 1836(b)," (2) Count II, titled "Civil 19 RICO[,] 18 U.S.C. § 1962(c)," (3) Count III, titled "Civil RICO [,] 18 U.S.C. § 1962(d)," and 20 (4) Count IV, titled "Trade Secret Misappropriation Under the California Uniform Trade 21 Secrets Act[,] Cal. Civ. Code § 3426." 22 DISCUSSION 23 By the instant motion, Jinhua argues the complaint should be dismissed for 24 insufficient service of process and lack of personal jurisdiction. 25 A. Service of Process 26 27 Under the Federal Rules of Civil Procedure, a foreign corporation may be served at "a place not within any judicial district of the United States" in the same manner as that 28 2 United States District Court Northern District of California 1 by which an individual may be so served, see Fed. R. Civ. P. 4(h)(2),2 including, inter alia, 2 the following: (1) "unless prohibited by the foreign country's law," by "using any form of 3 mail that the clerk addresses and sends to the [corporation] and that requires a signed 4 receipt," see Fed. R. Civ. P. 4(f)(2)(C); and (2) "by other means not prohibited by 5 international agreement, as the court orders," see Fed. R. Civ. P. 4(f)(3). 6 In August 2018, Micron sought to effectuate service under Rule 4(f)(2)(C), 7 specifically, by causing the Clerk of Court to mail a copy of the summons and complaint 8 to Stephen Chen, the President of Jinhua (see Doc. Nos. 89, 90), which method of 9 service Jinhua, by the instant motion, then challenged. After the motion was filed, 10 however, the Court, pursuant to Rule 4(f)(3), granted Micron leave to serve Jinhua by 11 other means, specifically, service by email sent to Jinhua's United States counsel of 12 record (see Order, filed November 20, 2018), which service was accomplished on 13 November 21, 2018 (see Proof of Service, filed November 21, 2018). 14 Accordingly, as Jinhua has now been properly served pursuant to Rule 4(f)(3), 15 Jinhua's challenge to Micron's earlier attempt to effectuate service is moot. 16 B. Personal Jurisdiction 17 18 19 Jinhua contends Micron cannot establish the Court's personal jurisdiction over Jinhua. Personal jurisdiction may be "general" or "specific." See Bancroft & Masters, Inc. 20 v. Augusta Nat'l Inc., 223 F.3d 1082, 1086 (9th Cir. 2000). Here, Micron alleges the 21 Court has specific jurisdiction over Jinhua. (See Compl. ¶ 17.) A court has specific 22 jurisdiction over a defendant if "(1) the defendant has performed some act or 23 consummated some transaction within the forum or otherwise purposefully availed [itself] 24 of the privileges of conducting activities in the forum, (2) the claim arises out of or results 25 from the defendant's forum-related activities, and (3) the exercise of jurisdiction is 26 27 28 2 The one exception is personal delivery. 3 1 2 Micron argues that Jinhua has engaged in three forum-related activities that 3 suffice to support a finding that Jinhua is subject to personal jurisdiction. As set forth 4 below, however, the Court finds Micron has failed to allege sufficient facts to support a 5 finding that any of those activities supports a finding of specific jurisdiction. See 6 Butcher's Union Local No. 498 v. SDC Investment, Inc., 788 F.2d 535, 539-40 (9th Cir. 7 1986) (holding plaintiff must "allege and eventually prove" facts to support finding of 8 personal jurisdiction; further holding plaintiff, in opposing motion to dismiss for lack of 9 personal jurisdiction, may not rely on factual assertions not pleaded in complaint). 10 United States District Court Northern District of California reasonable." See Bancroft & Masters, 223 F.3d at 1086.3 First, Micron argues, and offers evidence it asserts supports a finding, that Jinhua 11 has applied to and obtained from the United States Patent and Trademark Office 12 ("USPTO") patents that are based on Micron's trade secrets. Although a defendant that 13 applies for and obtains a patent from the USPTO is deemed to have "purposefully 14 directed its activities at the United States," see Touchcom, Inc. v. Bereskin & Parr, 574 15 F.3d 1403, 1416 (Fed. Cir. 2009), Micron has not based any of its claims on those 16 activities, and, consequently, any such contacts cannot support a finding of specific 17 jurisdiction here, see Butcher's Union Local No. 498, 788 F.2d at 540; see also Bancroft 18 & Masters, 223 F.3d at 1086 (holding "second requirement for personal jurisdiction is that 19 the contacts constituting purposeful availment must be the ones that give rise to the 20 current suit"); see, e.g., American Wave Machines, Inc. v. Surf Lagoons, Inc., 2014 WL 21 10475281, at *8 (S.D. Cal. November 12, 2014) (holding plaintiff's evidence that 22 defendant obtained patent from USPTO did not support finding of personal jurisdiction 23 where plaintiff's claims did "not arise out of or relate to [defendant's] patent"). 24 25 26 27 28 3 Micron argues, and the Court agrees, that the relevant forum here is the United States, as Micron has alleged federal claims, specifically, claims under 18 U.S.C. §§ 1836(b), 1962(c), and 1962(d), and Jinhua has not identified a state in which it would be subject to jurisdiction. See Holland America Lina Inc v. Wartsila North America, Inc., 485 F.3d 450, 461-62 (9th Cir. 2007) (holding where plaintiff alleges federal claim and defendant does not identify state in which it would be subject to jurisdiction, court may consider defendant's "contacts with the nation as a whole"). 4 United States District Court Northern District of California 1 Second, Micron argues, and offers evidence it asserts supports a finding, that 2 Jinhua employees, while in California in October 2016, met with "crucial equipment 3 suppliers" from which Jinhua "purchas[ed] equipment to manufacture DRAM technology." 4 (See Micron's Opp. at 7:1, 16:18, 18:13.) Although such activities would appear to 5 constitute purposeful availment of the privilege of doing business in the United States, 6 see Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475-76 (1985) (holding defendant 7 who "has created continuing obligations between himself and residents of the forum" has 8 "availed himself of the privilege of conducting business there"), Micron has not based any 9 claim thereon, and, as discussed above, such contacts thus do not support a finding of 10 specific jurisdiction, see Butcher's Union Local No. 498, 788 F.2d at 540; Bancroft & 11 Masters, 223 F.3d at 1086. 12 Lastly, Micron relies on allegations in its complaint that Jinhua, in June 2016, 13 "posted material on the U.S.-based organization CASPA's website advertising numerous 14 Jinhua job openings in a variety of DRAM positions" and, in October 2016, "sent a 15 travelling delegation to Silicon Valley . . . to recruit additional personnel for the DRAM 16 project" at a "job fair," during which Jinhua stated it would begin "mass production of its 17 first DRAM product beginning only one year later." (See Compl. ¶¶ 35-36.)4 According to 18 the complaint, said activities were "steps in furtherance of the [above-described] 19 conspiracy" between UMC and Jinhua. (See Compl. ¶ 35.) There is no dispute that a 20 misappropriation claim under § 1836 can be based on "conduct occurring outside the 21 United States" where "an act in furtherance of the offense was committed in the United 22 States," see 18 U.S.C. § 1837,5 nor has Jinhua disagreed that attempts within the United 23 24 25 26 27 28 4 Additionally, Micron has offered evidence that Jinhua did, in fact, attend and make presentations at the job fair, and that Jinhua also obtained resumes from attendees. (See, e.g., CIark Decl. Exs. 23 {Doc. No. 88], 26 at 22:2-4 [Doc. No. 95-5], 27 [Doc. No. 75-57].) 5 As noted, Count I asserts a claim under § 1836. Counts II and III, which assert RICO claims, are based on the alleged violations of § 1836. (See Compl. ¶¶ 64-66, 7576.) 5 1 States to recruit employees for work overseas can constitute purposeful availment. As 2 Jinhua points out, however, the complaint here does not include facts to support a finding 3 that Jinhua's recruitment efforts in the United States were made in furtherance of any act 4 of misappropriation identified in the complaint. Rather, to the extent the complaint makes 5 reference to such recruitment efforts, it includes only general, conclusory allegations as 6 to furtherance (see Compl. ¶¶ 17, 35), which allegations are insufficient to support a 7 finding of personal jurisdiction. See Butcher's Union Local No. 498, 788 F.2d at 540 8 (finding insufficient "nonspecific conclusory statement" in complaint offered to establish 9 personal jurisdiction; observing "complaint must include something more than mere 10 conclusory statements unsupported by specific facts").6 Accordingly, the complaint is subject to dismissal.7 United States District Court Northern District of California 11 12 C. Leave to Amend In its opposition, Micron requests leave to amend to plead additional jurisdictional 13 14 facts. A "court should freely give leave [to amend] when justice so requires." Fed. R. 15 16 Civ. P. 15(a)(2). In the instant case, it appears Micron, at the time it filed its complaint, 17 was not aware of various events it has described in its opposition, in particular, Jinhua's 18 obtaining patents from the USPTO and meeting with and ordering products from 19 suppliers in California. Further, it appears Micron may be able to plead facts to support 20 its conclusory assertion that Jinhua's recruitment efforts in the United States were in 21 furtherance of one or more acts of misappropriation. 22 Accordingly, Micron's request will be granted. 23 // 24 25 26 27 28 6 In its opposition, Micron argues, in essence, that Jinhua sought to recruit employees in the United States who, if hired, would assist it in producing products that incorporated Micron's trade secrets. The complaint, however, includes no such allegations. 7 In light of such ruling, the Court does not address herein Jinhua's additional arguments in support of dismissal. 6 CONCLUSION 1 2 3 4 5 6 For the reasons stated above, Jinhua's motion to dismiss is hereby GRANTED, and the complaint, to the extent asserted against Jinhua, is hereby DISMISSED. Micron's request for leave to amend is hereby GRANTED, and Micron shall file any amended complaint no later than February 8, 2019. 8 IT IS SO ORDERED. 7 8 Dated: January 18, 2019 MAXINE M. CHESNEY United States District Judge 9 10 United States District Court Northern District of California 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 8 In so amending, Micron is not limited to adding allegations to support the factual assertions made in its opposition and may add any facts it believes support its claims. 7
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