People Express Airlines, Inc. v. 200 Kelsey Associates, LLC, No. 4:2012cv00061 - Document 20 (E.D. Va. 2013)
Court Description: OPINION AND ORDER - 200 Kelsey's motion to dismiss pursuant to Rule 12(b)(2) is GRANTED. While the Court finds that personal jurisdiction over 200 Kelsey wanting, it reaches no conclusion as to the substantive aspects ofPEOPLExpress's Complaint. PEOPLExpress is therefore free to take whatever action it sees fit in a more appropriate forum. Signed by District Judge Mark S. Davis and filed on 2/5/13. (jcow, )
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UNITED STATES DISTRICT EASTERN DISTRICT COURT FILED OF VIRGINIA Newport News Division PEOPLE EXPRESS AIRLINES, INC. CLERK, US DiSTRiCT COURT NORFOLK, VA A Delaware Corporation Plaintiffs, Civil Action No. v. 200 KELSEY ASSOCIATES, 4:12cv61 LLC A New Jersey Limited Liability Company Defendant. OPINION AND ORDER This matter Associates, LLC's is before the ("200 Kelsey") Court on Defendant 2 00 Kelsey motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(2) or, in the alternative, to dismiss in part pursuant to Federal Rule of Civil Procedure 12(b)(6) Rule and to strike impertinent matter pursuant to Federal of Civil Procedure 12(f). After examining the Complaint, 200 Kelsey's motion to dismiss and the associated memoranda, the Court finds that the facts and legal contentions are adequately presented and oral argument would not aid in the decisional process. Fed. R. Civ. P. 78(b); E.D. Va. Loc. Civ. R. 7(J) . The matter is therefore ripe for decision. For the reasons set forth below, the Court GRANTS 200 Kelsey's motion to dismiss pursuant to Rule 12(b)(2). Because the Court finds it lacks personal jurisdiction, it does not reach 200 Kelsey's alternative ground for dismissal pursuant to Rule 12(b)(6) nor its motion to strike pursuant to Rule 12(f) . I. FACTUAL HISTORY1 Plaintiff People Express Airlines, Airlines or PEOPLExpress Inc. d/b/a PEOPLExpress ("PEOPLExpress") is a Delaware Corporation with a principle place of business in Newport News, Virginia. Defendant Kelsey is a limited liability company organized under the laws of the State of New Jersey with its principal place declaration of of business the parties' in New rights York. The in certain suit seeks a trademarks and judgment against 200 Kelsey for cybersquatting and unfair trade practices. PEOPLExpress is a corporation that formed in the summer of 2011 with the intent to begin providing airline passenger service in Virginia under the "famous" brand and marks related to "PEOPLE EXPRESS," including the word mark "PEOPLEXPRESS," the combination mark "PEOPLExpress," and a design mark depicting the profiles of two faces. related marks The "PEOPLE EXPRESS" brand ("Brand") and ("Marks") were previously used for passenger 1 The facts recited here are drawn from Plaintiff's Complaint and are assumed true for the purpose of deciding the motion currently before the Court. They are not to be considered factual findings for any purpose other than consideration of the pending motion. See TomTom, Inc. v. APT Sys. GmbH, No. I:12cv528, 2012 WL 4457730, at *1 (E.D. Va. Sept. 14, 2012). flight service by another company, also operating under the name PEOPLExpress, service from after PEOPLExpress 1981 becoming claims no until 1987, part of when that another connection to airline. the former Plaintiff PEOPLExpress claims only that it of the Brand and associated Marks company made ceased Plaintiff PEOPLExpress. intends to make use "famous" by the prior airline. Plaintiff PEOPLExpress asserts that it intended to commence passenger service in the summer of 2012 and that in the summer of 2011 it began taking several actions in preparation for such service, including performing marketing and accounting studies of Brand. the PEOPLExpress claims that it has invested significant time and money in extensive preparations to use the Brand in commerce. PEOPLExpress Trademark Additionally, on September 22, 2011, filed an intent-to-use application with the U.S. Office. This application and the circumstances surrounding it give rise to the instant litigation. Specifically, Office informed PEOPLExpress's on January PEOPLExpress intent-to-use 18, 2012, that it application, the U.S. could because Trademark not 200 approve Kelsey already held a prior-pending intent-to-use application for the mark "PEOPLE PEOPLExpress EXPRESS," claims that filed 200 on Kelsey's September pending 16, 2009. intent-to-use application is the second such application that 200 Kelsey has filed with respect to the "PEOPLE EXPRESS" mark, and that 200 Kelsey filed this second application five days before the first application was to become abandoned due to 200 Kelsey's failure to file a statement of use. the "PEOPLE EXPRESS" September 21, 2005, Thus, mark 200 Kelsey has allegedly kept unavailable the date to 200 for it filed its registration first since intent-to-use application. With respect application, the U.S. Allowance on May 17, Kelsey's Trademark 2011. second office intent-to-use issued a Notice of 200 Kelsey then filed for a six- month extension of time to file its statement of use on November 17, 2011, which extension PEOPLExpress claims granted, was granted on that further extensions effectively suspending any November 19, 2011. of time might be further action Kelsey's intent-to-use application until May 17, on 2014, 200 at the latest. PEOPLExpress alleges that 200 Kelsey has a practice of registering trademark applications without having the intent to use the marks in commerce, and that 200 Kelsey continually extends its registrations so it may demand licenses from those, such as commerce. money" PEOPLExpress, do intend to use the marks in PEOPLExpress claims that 200 Kelsey aims "to extort for marks legitimate who it has never used and in which it has no rights. PEOPLExpress further alleges that, in addition to filing fraudulent trademark applications, 200 Kelsey registers domain names for marks in which it has no ownership or interest, and does not intend to use in any way, in an effort to "hold" the domain name. PEOPLExpress accordance with this practice, name complains that, in 200 Kelsey registered the domain www.peopleexpressairline.com on July 26, 2005 and the domain name www.peopleexpressair.com on November 23, 2009. Sometime after learning of 200 Kelsey's pending intent-to- use application, PEOPLExpress contacted 200 Kelsey regarding the mark. PEOPLExpress claims that 200 Kelsey refused to consider any agreement involving its application other than a "license" of the mark application. agreement to PEOPLExpress PEOPLExpress pending the complains resolution that such of a such license is improper because it would create in 200 Kelsey controlling rights to the mark where none currently exist. II. PEOPLExpress PROCEDURAL HISTORY initiated the instant action on April 26, 2010, when it filed a three-count Complaint against 200 Kelsey seeking a declaratory judgment (Count I) and alleging that 200 Kelsey cyber squatted in violation of the Lanham Act (Count II) and engaged in unfair trade practices (Count III). PEOPLExpress declare that specifically PEOPLExpress's use requests of the that "PEOPLE the court EXPRESS" (1) mark does not infringe on the rights of 200 Kelsey; (2) declare that 200 Kelsey has no right, title, or interest in the marks domain names involving the words PEOPLE and EXPRESS; preliminary from and pursuing names or Kelsey websites any logos to permanent assign injunctions existing associated to or future with and trademark PEOPLExpress; PEOPLExpress or domain names; restraining (5) all rights order 200 (3) 200 issue Kelsey involving (4) to order any Kelsey or and the 200 all to abandon any and all trademark applications for any mark including the words "PEOPLE" and "EXPRESS" and any other mark associated with PEOPLExpress. PEOPLExpress also seeks actual and punitive damages, costs, and attorneys' fees. On May 18, 2012, 200 Kelsey filed its motion to dismiss and a brief supporting such motion. ECF Nos. filed its opposition brief on June 5, 2012. Kelsey filed its reply brief on June 11, Therefore, 5-6. PEOPLExpress ECF No. 2012. 9. ECF No. 200 10. 200 Kelsey's motion to dismiss is fully briefed and ripe for this Court's consideration. III. DISCUSSION If the Court lacks personal jurisdiction over 200 Kelsey, dismissal of all claims is appropriate.2 Therefore, the Court 2 200 Kelsey has filed a motion to dismiss for lack of personal jurisdiction pursuant to Rule 12(b)(2). PEOPLExpress responds by arguing only that this Court has personal jurisdiction over 200 Kelsey in this action. PEOPLExpress does not argue, in the alternative, that a transfer of venue pursuant to 28 U.S.C. §1406 is appropriate, should the Court find that it lacks such jurisdiction. Failure to raise a claim that transfer of venue is appropriate constitutes a begins by considering 200 Kelsey's Motion to Dismiss Pursuant to Rule 12(b)(2). Because jurisdiction over 200 the Kelsey, Court it finds does not it lacks reach personal 200 Kelsey's alternative ground for dismissal nor its motion to strike. A. Rule 12(b)(2) Standard of Review permits a party to dismiss an action on the ground that jurisdiction over that party. request the that a court lacks court personal Fed. R. Civ. P. 12(b)(2). When a defendant challenges the court's personal jurisdiction over him, the plaintiff possesses bears personal evidence. the burden of proving jurisdiction by a Mylan Labs. , Inc. (4th Cir. 1993); Combs v. 1989). denies In cases where facts essential v. Bakker, Akzo, that the preponderance N.V. , 2 of F.3d 56, 886 F.2d 673, 676 court the 59-60 (4th Cir. "the defendant provides evidence which for under threat of dismissal, jurisdiction, xthe plaintiff must, present sufficient evidence to create a factual dispute on each jurisdictional element which has been denied by the defendant and on which the defendant has presented evidence.'" Colt Def., L.L.C. v. Heckler & Koch Def., Inc., No. 2:04cv258, 2004 U.S. Dist. LEXIS 28690, at *29-30 (E.D. Va. Oct. waiver of such claim. Jenson v. Klayman, 115 Fed. App'x 634, 635-36 (4th Cir. 2004) . Additionally, although the Court has discretion to transfer venue in the interest of justice, there are no facts before the Court suggesting an appropriate alternative venue or that transfer is in the interest of justice. See 28 U.S.C. § 1406(a). 22, 2004) (quoting Indus. Leasing Corp., When party, Carbon Corp. 737 F. Supp. deciding the v. Equity Auto & Equip. 925, 926 (W.D. Va. 1990)). question of its jurisdiction over a the Court may rule "on the basis only of motion papers, supporting legal complaint." memoranda Combs, 886 and F.2d the at relevant 676. In allegations that of context, a "the burden on the plaintiff is simply to make a prima facie showing of a sufficient jurisdictional prima facie jurisdictional challenge." showing, Id. "a basis court 93312, F.3d Nutrition at at No. 3:09cv269, *4 (E.D. Va. Sept. 29, 62) . However, "the court pleading allegations plaintiff, assume inferences at Co., 676. in the credibility, and for the existence of to both v. Mead Dist. LEXIS (citing Mylan Labs, must light look U.S. the plaintiff's PBM Prods, 2009 2009) a may plaintiff and defendant's proffered proof." Johnson survive evaluating In district to construe most draw all favorable the jurisdiction." most Combs, 2 relevant to the favorable 886 F.2d In any motion pursuant to Rule 12(b) (2), the ultimate question is whether the plaintiff has proven that the Court has personal jurisdiction over the defendant. "'Personal jurisdiction' is the phrase used to express a court's power to bring a person into its adjudicative process." Noble Sec, (E.D. Va. Inc. 2009) v. MIZ (citing Eng'g, Ltd., Black's Law 611 F. Supp. Dictionary 2d 513, 857 (7th 525 ed. 1999)). "Federal jurisdiction its district 'only to constitutional federal courts."' power Id. Inc. , 126 F.3d 617, of personal Inst, of n.15 (4th requires state, Cir. authorized by ordain (4th Cir. Fin. general Analysts 2009). "requires under the v. lower Centricut, There are two types CFA Inst, 551 285, 292 ... contact F.3d v. jurisdiction personal connection with defendant to defend the itself only that the forum state in that Helicopteros Nacionales de Colombia, with the forum S.A. relevant that it is Id. conduct fair state." Id. v. Hall, 466 U.S. for (citing 408, (1984)). "[F]or a district jurisdiction over a be Inc. India, systematic' personal Congress and specific. of such establish 1997)). "General and jurisdiction such a 414-15 and (quoting ESAB Grp., 622 'continuous exercise regardless of where the relevant conduct occurred." Specific the to jurisdiction: Chartered degree may such that a defendant may be sued in that state for any reason, have the courts satisfied: (1) authorized under the court nonresident the to defendant, exercise [forum] jurisdiction must requirements the Inc. v. Cir. 2003). of [specific] two Fourteenth personal conditions jurisdiction state's long arm statute; the exercise of of assert must must be and (2) comport with the due process Amendment." Carefirst Pregnancy Ctrs. , Inc., 334 Carefirst F.3d 390, of Md., 397 (4th Virginia's long-arm statute provides that "[a] court may exercise personal jurisdiction over a person, who acts directly or by an agent, of as to a cause of action arising from" enumerated activities, in this Commonwealth," or omission 328.1(A)(1) Fourth in & Circuit which amounts rise to a Commonwealth." noted that "a single 'transacting business' cause of action jurisdiction upon [Virginia] contractual Va. Code Ann. § 8.01- The United States Court of Appeals for the has to "[t] ransacting any business and "[clausing tortious injury by an act this (3). including a number relationship may act by a nonresident in Virginia be sufficient and gives to confer courts," even if that act is a mere conducted entirely out-of-state telephone and mail. English & Smith v. 38-40 (4th Cir. 1990) (quoting Danville Plywood Corp. v. Plain & Fancy Kitchens, Inc. , Peninsula Cruise, 315, 318-19 237 Va. 'is a Inc. (1999) 255, 260 (1989)) to "[w]hen jurisdiction Va. acts 533, 534-35 New River Yacht confer ("We have statue Virginia from v. Va. 901 (1977)); Sales, Inc., F.2d 36, see also 257 Va. (quoting Nan Ya Plastics Corp. v. DeSantis, single-act [Virginia's 218 Metzger, via requiring jurisdiction on only our a person long-arm statute], only a enumerated over held that [therein] may Code § 8.01-328.1(C). 10 be Code one § 8.01-328.1 transaction courts.'"). is cause based of asserted in However, solely upon action arising against him." Virginia's long-arm statute has been determined "to extend personal jurisdiction to extent permissible inquiry." Consulting Eng'rs Ltd., 561 F.3d 273, 277 (4th Cir. 2009) Haven Advocate, 315 F.3d 256, (4th process requirement "sufficient is 'minimum 'the maintenance of 261 satisfied contacts' with Corp. the v. due Geometric, (citing Young v. Cir. if 2002)). the the forum The defendant state such New due has that the suit does not offend traditional notions of fair play and substantial justice.'" Co. v. Wash. , 326 U.S. the of existence under [so that] the statutory inquiry merges with the process clause, constitutional the 310, sufficient 316 Id. (quoting Int'1 Shoe (1945)). minimum In order to establish contacts with the forum, a plaintiff must prove that the defendant '"purposefully directed his activities at the residents of the forum' and that the plaintiff's cause of action 'arise[s] out of those activities." Id. (quoting Burger King Corp. v. Rudzewicz, (1985)). Furthermore, the defendant's 471 U.S. activities or 462, 472 contacts with the forum must be such that he would "reasonably anticipate being haled into court" in the forum state. World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980). In accordance has established sufficient court is with a minimum to the above three-part contacts consider: nMD standard, test exist. the 11 for the Fourth Circuit determining Specifically, extent to which a the whether district defendant purposefully activities arise out whether availed in of the quality, 334 712 (2) of the Inc. the directed at personal 2002)). 397. conducting the State; The 561 and (3) be F.3d Consultants, analysis claims would jurisdiction v. Digital Serv. (4th Cir. of plaintiffs' Geometric, not merely the quantity, F.3d at privilege whether reasonable.'" (quoting ALS Scan, 707, of activities exercise constitutionally F.3d State; those the itself at Inc., focuses of the contacts. 278 293 on the Carefirst, "Even a single contact may be sufficient to create jurisdiction when the cause of action arises out of that single contact, substantial justice' Burger King, has not provided that is 471 U.S. at purposefully conducting not the principle of thereby 477-78). availed activities in offended." However, itself the forum, personal jurisdiction is appropriate. LLC v. Shandong (4th Cir. Noble, 2012) Linglong Rubber of 561 Id. where a the (quoting defendant privilege of for dismissal of lack Tire Eng'g & Distrib., Co. , Ltd. , (citing Geometric, 'fair play and 682 F.3d at F.3d 273); 292, 302 see also 611 F. Supp. 2d at 530. B. Analysis As argues a threshold only that matter, this the Court Court may notes exercise that PEOPLExpress specific personal jurisdiction over 200 Kelsey based on its actions with respect to the Brand, Marks, and Plaintiff 12 PEOPLExpress. PEOPLExpress does not contend that this Court may exercise general personal jurisdiction over specifically 200 Kelsey. disclaims jurisdiction in Accordingly, its the the brief Court On the Court's contrary, ability in opposition to considers only to the PEOPLExpress exercise such instant motion. the question Court lacks of its specific jurisdiction over 200 Kelsey. 200 Kelsey argues jurisdiction because contacts with the 200 that this Kelsey does forum. 200 purposefully availed itself of in Virginia and, accordingly, forum would offend substantial justice. submitted an ("Reich"). Kelsey contends traditional notions of that it never doing business fair In support of its position, affidavit any meaningful that haling it into court in this from its president, play and 200 Kelsey has Michael Reich Reich certifies that 200 Kelsey does not maintain a does not advertise in Virginia, is not engaged in significant or in Virginia, has no long-term business activities employees or agents have any property, bank accounts, addresses in Virginia, nor any facilities in Virginia. ECF No. is not incorporated in Virginia facts have the privilege of physical presence in Virginia, not not personal suggesting that business in Virginia. 200 has See ECF No. 6 at 8. 13 f 5) or mailing locations Additionally, (Compl. Kelsey offices, operations, 6-2. and does in Virginia, or 200 Kelsey and there are no otherwise conducted In response,3 PEOPLExpress offers two bases upon which it asserts that this Court may jurisdiction over 200 Kelsey: PEOPLExpress purchase constituted an resident of a (1) license forum, specific personal 200 Kelsey's "demand"4 that for individualized the exercise the "PEOPLE tortious sufficient to act give EXPRESS" taken rise mark against to a specific jurisdiction of 200 Kelsey; and (2) 200 Kelsey's registration of domain names using the "PEOPLE EXPRESS" mark and subsequent offer to sell such domain names to PEOPLExpress created personal jurisdiction over 200 Kelsey in this forum. 200 Kelsey replies that PEOPLExpress initiated contact with 200 Kelsey occurred outside represents at his outside that office of of Virginia Virginia. PEOPLExpress's in and that such contact 2 00 Kelsey Specifically, attorney Connecticut all in contacted January its attorney to express 2012 PEOPLExpress's interest in purchasing 200 Kelsey's rights in the "PEOPLE EXPRESS" mark. After some communication back and forth via telephone and email, Reich met with PEOPLExpress President, 3 PEOPLExpress The Court notes that failed to plead personal jurisdiction in its Complaint and that all of PEOPLExpress's arguments in support of this Court's jurisdiction over 200 Kelsey were raised after 2 00 Kelsey filed its motion to dismiss pursuant to Rule 12(b)(2). 4 200 Kelsey does not concede that a demand was made, but in ruling on personal jurisdiction, this Court "must construe all relevant pleading allegations in the light most favorable to the plaintiff . . . ." Combs, 886 F.2d at 676. Therefore, the Court characterization for purposes of this motion only. 14 will adopt this Michael Morisi ("Morisi"), in New York to discuss PEOPLExpress's interest in the mark. agreement its and no response rights it may constitute business to However, contract formed. PEOPLExpress's hold in purposeful Virginia the "PEOPLE of mark does benefits of establishing not doing personal because 200 Kelsey did not initiate all communications occurred outside the forum, to PEOPLExpress's jurisdiction, 200 trademark owner therefore, 200 alleged that in purchasing whatever the no contract resulted with PEOPLExpress, respect Kelsey argues EXPRESS" of purposes forum, 2 00 interest availment for jurisdiction in this the contact, was the parties could not reach an Kelsey within Kelsey's domain names second argues the the basis that meaning forum party. for the are insufficient to is Lanham out-of-forum activities With personal PEOPLExpress of and not Act concerning establish a and, the personal jurisdiction over 200 Kelsey in the instant action. As discussed above, determining whether a court can exercise personal jurisdiction over a defendant is a two-pronged inquiry, focusing both on the long-arm statute of the state in which the While district these two court sits inquiries statute extends personal and due merge process because jurisdiction to considerations. Virginia's the long-arm extent authorized by the Due Process Clause of the Fourteenth Amendment, and the Court therefore need only conduct a constitutional analysis, 15 see Geometric, 561 F.3d at 277, the Court will briefly address its jurisdiction under the Virginia long-arm statute PEOPLExpress's statute) reliance before on specific to turning two the constitutional (in light of provisions of that inquiry. The Court will then address each of the proffered acts of purposeful availment act is in turn. sufficient Circuit's test, 12(b)(2) 302 Ultimately, to satisfy because the it first finds prong that of neither the Fourth the Court finds that dismissal pursuant to Rule is appropriate. (citing Geometric, See Tire Eng'g & Distrib., 682 F.3d at 561 F.3d at 273) ; see also Noble, 611 F. Supp. 2d at 53 0. i. PEOPLExpress Virginia's Long-Arm Statute cites two subsections of Virginia's long-arm statute in support of its argument that this Court may exercise personal jurisdiction over 2 00 Kelsey. In relevant part, long-arm statute provides that: A. A court may exercise personal jurisdiction over a person, who acts directly or by an agent, as to a cause of action arising from the person's: 3. Causing tortious injury by an act or omission in this Commonwealth. 4. Causing tortious injury in this Commonwealth to any person by an act or omission outside this Commonwealth if he regularly does or solicits business, or engages in any other persistent course of conduct, used or or derives consumed substantial or services Commonwealth. 16 revenue rendered, from in goods this the Va. Code Ann. § 8.01-328.1 (A) (1) & (3). In reviewing these provisions in light of the facts before it, the Court finds that neither supports the exercise of personal jurisdiction over 200 Kelsey in this case. First, to jurisdiction subject in a nonresident Virginia pursuant defendant to § to personal 8.01-328.1(A)(3), PEOPLExpress "must allege 'that one essential act of the alleged tort occurred in Virginia.'" Pharm., Nov. LLC, 13, 2008) 05-0335, also No. 3:08cv393, 1983). v. 2757930, at *6 Broad. Co. , Am. PEOPLExpress committed any 2008 WL Pharm., 4911232, (quoting Decisions Insights, 2005 WL Brown Provident act has in (E.D. 704 failed Virginia. Va. F.2d to Inc. v. Quillen, No. Oct. 21, see 1296, jurisdiction 328.1(A)(3) because over there 200 are facts 2005)); 1300 that regardless Kelsey no *3 Amneal Va. PEOPLExpress has suffered a tortious injury, exercise at v. (E.D. allege Thus, Inc. (4th Cir. 200 Kelsey of whether this Court may not pursuant to suggesting § 8.01that any aspect of such tortious injury was caused "by an act or omission in this Commonwealth." Va. Code Ann. § 8.01-328.1(A)(3) (emphasis added). Personal jurisdiction over 200 Kelsey is exercised pursuant to § 8.01-328.1(A) (4) . also not properly For this provision of Virginia's long-arm statute to confer jurisdiction, must show that (1) 200 Kelsey 17 caused tortious PEOPLExpress injury in the Commonwealth by an act or omission outside of the Commonwealth; (2) 200 Kelsey regularly does or solicits business, in any other persistent substantial rendered in the from revenue action arises Kelesy, in of used and has or derives consumed or services PEOPLExpress's cause of or (3) conduct. conduct, See failed Va. to make Ann. such PEOPLExpress relies solely upon any other persistent revenue from asserting course goods used of or On the contrary, that it has no presence in the Commonwealth of Virginia. failed to requirement 8.01- showing. offer any evidence set of an There are no facts before the Court suggesting rendered in Virginia. affidavits § allegations Kelsey regularly does or solicits business, substantial has Code in arguing this Court's personal jurisdiction over isolated demand.5 the 200 such PEOPLExpress Specifically, 200 goods Commonwealth; from 328.1(A)(4). course or engages forth in or engages conduct, or derives consumed or services 200 Kelsey has offered physical or business Because PEOPLExpress or argument as § 8.01-328.1 (A) (4) , to the the Court second finds that it may not properly exercise jurisdiction pursuant to this subsection of Virginia's long-arm statute. 5 PEOPLExpress characterizes such demand only as a "license" demand. Compl. H 46, ECF No. 1; see also ECF No. 9 at 4, 7. Although PEOPLExpress summarily trademark owner can domicile, PEOPLExpress an offer, as the Court argues that an offer to sell a domain name to a create jurisdiction in the trademark owner's does not allege that 200 Kelsey ever made such discusses in greater detail below. 18 Although the Court finds that the proffered subsections of Virginia's long-arm statute do not support a finding of personal jurisdiction over another subsection jurisdiction. that "[a] person, 200 may in may acts this support Specifically, court who Kelsey the Section exercise directly case, or an note that of such exercise 8.01-328.1(A)(1) personal by it does provides jurisdiction agent, as to a over a cause of action arising from the person's ... transacting any business in this 8.01-328.1(A)(1). Commonwealth." Va. Code Ann. Courts have repeatedly held that statute requiring jurisdiction." Thus, the nonresidents Id. is one transaction Peninsula Cruise, purpose provisions state to only of the engage "is in some in to Virginia to the to one omitted). And, purposeful thus, Accordingly, with § activity the turns to the constitutional inquiry, in in over this inquiry 561 F.3d at mind, specifically, its clause." "statutory Geometric, 8.01-328.1 (A) (1) of jurisdiction the extent permissible under the due process (citations confer (citing cases). extent assert merges with the constitutional inquiry." 277. "is a single-act 257 Va. at 319 statue, implicated, who § 8.01-328.1 Virginia the Court the two acts that PEOPLExpress alleges constitute purposeful availment. ii. As described three-prong test Due Process Requirements above, for the Fourth determining 19 Circuit whether a has set court has forth a personal jurisdiction over a find such that it consider (1) itself (2) of has nonresident defendant. jurisdiction over For 200 this Court Kelsey, it to must the extent to which 200 Kelsey purposefully availed the privilege of conducting activities in Virginia; whether PEOPLExpress's claims arise out of those activities; and (3) whether this Court's exercise of personal jurisdiction is constitutionally reasonable. However, because the Court See Geometric, finds that 561 F.3d at 278. none of 200 actions rise to the level of purposeful availment, finds that dismissal is appropriate. F.3d at 302 (citing Geometric, Kelsey's it ultimately Tire Eng'g & Distrib., 561 F.3d at 273); 682 see also Noble, 611 F. Supp. 2d at 530. a. License Demand as Purposeful Availment PEOPLExpress's that mark, PEOPLExpress 200 Kelsey primary purchase contention a license purposefully is to directed that, by demanding the "PEOPLE EXPRESS" its activities at a resident of Virginia in a manner sufficient to give this Court personal jurisdiction over 200 Kelsey for any cause of action arising out of such contact. PEOPLExpress is correct that be sufficient to create jurisdiction when the arises out of that single contact." The Supreme Court has "[e]ven a single contact may routinely creates a 'substantial connection' 20 Carefirst, held that cause of action 334 F.3d at 397. "[s]o with the forum, long as it even a single act can support jurisdiction" Burger King, 471 U.S. Ins. Co. , 335 U.S. over at 475 n.18 220, 223 a nonresident (quoting McGee v. Int'l Life (1957)). But, "'some occasional acts' related to the forum may not be establish jurisdiction [such] circumstances of their at The 318) . Supreme Id. Court has create only not be 'random,' into 'fortuitous,' 'unilateral Burger haled activity King, 471 of U.S. a or observed jurisdiction that party 475 an 'attenuated' the "purposeful as a contacts, or (internal 326 U.S. that a defendant solely 'attenuated' another at or sufficient to (quoting Int'1 Shoe, availment" requirement is designed to "ensure[] will single 'if their nature and quality and commission' affiliation with the forum.'" defendant. a result or of of the third person.'" citations omitted). Accordingly: The unilateral activity of those who claim some relationship with a nonresident defendant cannot satisfy the requirement of contact with the forum state.... [I] t is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws. Id. (quoting Hanson v. Denckla, (internal quotation marks omitted). nonresident defendant proximately result is proper from actions 21 357 U.S. Thus, 235, 253 jurisdiction over a "where the contacts by the (1958)) defendant [at issue] himself that create a 'substantial connection' McGee, U.S. (quoting Because of at 223) w[jJurisdiction may not be others," generated Kelsey's it 335 with the by Court the defendant" have reasonably Court for the conduct NANA Dev. Corp. , Ultimately, as exercise to "those when the Court a single act, of specific 1124, considers in Id. original). [contacts] determining [Virginia]" anticipated F.2d state." manufactured by the conduct complained of 783 forum (emphasis "conduct and connection with should demand, looks the being in this 1127 whether actually whether is haled such that into action. (4th the 2 00 this Chung v. Cir. 1986). alleged license is sufficient to warrant this Court's personal jurisdiction over 200 Kelsey in this action under the Due Process Clause. The Fourth Circuit has summarized various, nonexclusive factors that district courts consider when evaluating whether a defendant has purposefully availed himself of conducting business in the forum State. the privileges of Such factors include, but are not limited to: 6 Although this standard requires a "substantial connection" with the forum state, it is distinct from the standard applicable to general personal jurisdiction, by which a State exercises jurisdiction over a party "in a suit not arising out of or related to the defendant's contacts with the forum." Burger King, 471 U.S. at 473 n.15 (quoting Helicopteros, 466 U.S. at 414 n.9) (emphasis added). The "substantial connection" required to support the exercise of specific jurisdiction refers to the connection required between the defendant's activities and the forum, when those activities serve as in which such jurisdiction is exercised. U.S. at 223). 22 the basis See id. for the (quoting McGee, suit 335 (1) whether the defendant maintains offices or agents in the forum state; (2) whether the defendant owns property in the forum state; (3) whether the defendant reached into the forum state to solicit or initiate business; (4) whether the defendant deliberately engaged in significant or long-term business activities in the forum state; (5) whether the parties contractually agreed that the law of the forum state would govern disputes; (6) whether the defendant made in-person contact with the resident of the forum state in the forum state regarding the business relationship; and (7) the nature, quality and extent of the parties communications about the business being transacted. Geometric, 561 F.3d (numbering added). Kelsey maintains property in at offices Virginia, Accordingly, the first, of or or or finding (internal citations omitted) There are no facts before the Court that 200 significant a 278 agents that long-term has business second, purposeful it in Virginia, that deliberately activities it owns engaged in in Virginia. and fourth factors weigh against availment. Similarly, both parties agree that they were unable to reach an agreement concerning the "PEOPLE parties, EXPRESS" mark. Since no contract exists between the the fifth factor weighs neither in favor nor against a finding of purposeful suggesting that PEOPLExpress in 200 the Kelsey Virginia. between the parties Therefore, availment. Further, ever On made the occurred outside sixth factor 23 in-person contrary, the against are no facts contact of Virginia, weighs purposeful availment. there a only with meeting in New York. finding of The third factor purposeful availment. Kelsey agree 200 likewise weighs Specifically, against a finding of both PEOPLExpress and 200 (although with varying degrees of emphasis), Kelsey's license demand was in response to an that inquiry initiated by PEOPLExpress after it learned of 200 Kelsey's prior pending intent-to-use application. There are no facts before the Court suggesting that 200 Kelsey ever "reached into" Virginia to solicit or initiate business. Geometric, at reached 278. On Virginia pending to the initiate although court may initiated it accord with 20 0 The may Fourth not treat such weight" to "special contact PEOPLExpress contact application. that, n.17; contrary, with the other. Circuit the outside of as its expressly held dispositive, fact that Inst., Ohio, F.3d concerning has fact CFA see also Diamond Healthcare of Mary Health Partners, Kelsey 561 551 Inc. v. one F.3d a party at 295 Humility of 229 F.3d 448, 451 (4th Cir. 2000) (finding nonresident defendant's contacts insufficient to confer personal jurisdiction, in part, because the plaintiff had initiated the contractual relationship). In that of six none purposefully the availed business in Virginia, to the fact that the first itself light of factors the the Court does complained 24 of of the Court's suggest privileges findings 200 of Kelsey conducting accord significant weight demand occurred not only outside of Virginia, but solely in response to contact initiated by PEOPLExpress. This quality, leaves the and extent of and 200 Kelsey. matter, any seventh the and final factor, the nature, communications between PEOPLExpress Geometric, 561 F.3d at 278. As a threshold the Court observes that PEOPLExpress has failed to plead facts concerning its communications with 200 Kelsey, with the exception of its general allegation in Paragraph 46 of the Complaint resolve that that: the [200] "When matter approached of Kelsey ha[d] the by blocking Plaintiff to intent-to-use filed for PEOPLE EXPRESS, attempt application [200] refused to consider anything other than a 'license'...." H 46, ECF No. 1. to Kelsey Compl. PEOPLExpress likewise failed to describe any other communications with 200 Kelsey in its brief in opposition to 200 Kelsey's motion to dismiss. to 200 Kelsey's proffers Accordingly, concerning such evaluating the seventh Geometric factor.7 that its attorney, Edmund J. the Court looks communication when 200 Kelsey represents Ferdinand, III ("Ferdinand"), received one voicemail message at his office in Connecticut from 7 The Court may properly consider such proffers when evaluating whether PEOPLExpress has made jurisdictional basis to Prods., 2009 U.S. Dist. a prima facie showing of a survive 200 Kelsey's challenge. LEXIS 93312, at *4. However, sufficient See PBM "the court must construe all relevant ... allegations in the light most favorable to the plaintiff, assume credibility, and draw the most favorable inferences for the existence of jurisdiction." Id. 25 PEOPLExpress's attorney, Ferdinand and Byers interest "PEOPLE Duncan Byers exchanged emails in purchasing any rights EXPRESS" mark. ECF No. ("Byers"), and that concerning PEOPLExpress's 200 Kelsey may 10, Ex. 1-2. have in the Additionally, Ferdinand exchanged emails with Morisi regarding Morisi's desire to meet with Reich in New York. 200 Kelsey represents that this meeting did in fact take place. Thus, one to voicemail emails outside the from exchanged of PEOPLExpress between Virginia. the two, the Court has before it 200 and Even construing Kelsey, one they do not support a finding that 200 series meeting these light most favorable to PEOPLExpress, a of occurring communications in the Court finds that Kelsey purposefully directed its efforts toward PEOPLExpress. For these reasons, finding of demand. purposeful Although finds that, none of the Geometric factors support a availment these factors based are on not the alleged exclusive, license the Court in viewing the facts before it as a whole and in the light most favorable to PEOPLExpress, there is simply not enough to support a finding that 2 00 Kelsey purposefully availed itself of the privilege exchanges and occurred here, of doing telephone are, alone, purposeful availment." (describing the business in Virginia. Brief email such those that conversations, as "qualitatively insufficient Tire Eng'g & Distrib., 682 Fourth Circuit's 26 analysis in to show F.3d at 302 Geometric concerning a nonresident defendant who "maintained no offices in Virginia" and had never traveled there, but who had "exchanged four brief emails and had several phone conversations with the Virginia-based which plaintiff"). PEOPLExpress applications and in Geometric, complains 200 its outside Virginia. As alleged Geometric, the Kelsey's license conduct of intent-to-use demand occurred 561 F.3d at 282. entirely The Court finds that 200 Kelsey's alleged contacts are simply too attenuated to support this Court's exercise of specific personal jurisdiction over 200 Kelsey in this case. PEOPLExpress cannot, own unilateral inquiry and solicitation of a finding to the contrary. through its information, See Burger King, support 471 U.S. at 475 (quoting Hanson, 357 U.S. at 253). b. Alleged Offer to Sell Domain Name as Purposeful Availment In license addition to demand its was primary contention 200 Kelsey's to sufficient that specific personal create jurisdiction over 200 Kelsey in Virginia, PEOPLExpress summarily argues that "a person who registers a trademark as a domain name and offers subject that domain name to domicile." Toeppen, briefly personal ECF No. 141 F.3d addressing for sale to a jurisdiction 9 at 1316, the 6 in (citing 1322-24 merits of trademark owner the trademark Panavision (9th this Cir. Int'l, is owner's L.P. 1998)). argument, ... v. Before the Court observes that PEOPLExpress has not pled or otherwise alleged any 27 facts indicating that 200 names to PEOPLExpress. Kelsey Rather, ever offered to sell domain PEOPLExpress simply alleges that 200 Kelsey registered two domain names using the Brand without subsequently making a marketplace use of those domains.8 H1I 51-52, ECF No. 1. Accordingly, exercise specific personal basis of such offers even if the jurisdiction over 200 alone, there are no facts Compl. Court could Kelsey on the alleged in the Complaint or briefings indicating that any such offers were ever made. Additionally, the Ninth Circuit case cited PEOPLExpress requires that the nonresident "engage[] to register purpose [another's] of extorting his domain names for the money [the from 141 F.3d at 1322. rule this reach), in PEOPLExpress in a scheme trademarks as Panavision Int'1, applies by Circuit could Accordingly, (a question not trademark invoke even if such a the it owner]." Court as a does not basis for jurisdiction, as PEOPLExpress, by its own pleading, affirms that it is not currently and has never been the owner of the mark at 8 PEOPLExpress generally "scheme to extort money" argues that 200 from PEOPLExpress. Kelsey ECF No. was engaged 9 at 8. in a However, the only facts alleged supporting the existence of such scheme concern the alleged "license" demand. Compl. U 46, ECF No. 1; see also ECF No. 9 at 4, 7. In its Complaint, PEOPLExpress alleges that, in other such schemes, 200 Kelsey registered domain names using marks that it had reserved in intent-to-use applications with the intent to extort money from others interested in such marks. Compl. H 48, ECF No. 1. However, PEOPLExpress fails to allege any facts suggesting that, in this case, 200 Kelsey did anything more than register two domain names in 2005 and 2009. Nowhere does PEOPLExpress claim that 200 Kelsey subsequently offered to sell those domain names to or otherwise extort money from PEOPLExpress. 28 issue. Accordingly, specific the Court finds no basis for exercising personal jurisdiction over 200 Kelsey under PEOPLExpress's alternative theory. V. CONCLUSION The Court finds that PEOPLExpress has failed to show that 200 Kelsey purposefully availed itself of the privilege of doing business in activities Virginia at or otherwise PEOPLExpress, a purposefully resident of directed Virginia. its Because PEOPLExpress has failed to make a prima facie showing of this first element of the the Rule does 12(b)(2) not action. have As jurisdictional analysis, analysis personal a result, above, the jurisdiction Court over dismiss finds all the pursuant that reaches of no foregoing to Rule personal jurisdiction conclusion PEOPLExpress's Complaint. as to is 200 2 00 Kelsey 200 Kelsey's GRANTED. over the forth in that in it this Kelsey's and 12(f). reasons, 12(b)(2) set concludes the Court need not address alternative motions under Rules 12(b)(6) For as 2 00 motion While the to Court Kelsey wanting, it substantive aspects of PEOPLExpress is therefore free to take whatever action it sees fit in a more appropriate forum. The Clerk is REQUESTED to send a copy of Order to counsel of record for the parties. 29 this Opinion and IT IS SO ORDERED /sWfcr Mark S. Davis United States District Judge Norfolk, Virginia February 5 / 2013 30
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