Wednesday, July 20, 2016

D. Delaware decision on jurisdiction vacated by CAFC in Polar Electro

The outcome:

Polar Electro Oy (“Polar”) appeals from the decision of
the United States District Court for the District of Delaware
granting Suunto Oy’s (“Suunto”) motion to dismiss
for lack of personal jurisdiction. See Polar Electro Oy v.
Suunto Oy, No. 11-1100, 2015 WL 2248439 (D. Del. May
12, 2015). Because the district court erred in determining
that Suunto lacked sufficient minimum contacts with
Delaware to support specific jurisdiction, we vacate and

Yes, Polar and Suunto are BOTH Finnish companies.

Note a footnote

The parties designated certain information in
their merits briefs as confidential, but later informed the
court that “the information in the merits briefs may be
discussed at argument and included in any opinion.”
Polar Electro Oy v. Amer Sports Winter & Outdoor, No.
15-1930, ECF No. 50 (Fed. Cir. Apr. 29, 2016). Other
materials designated as confidential in the joint appendix
remain sealed. Id.

As to the law

Determining whether personal jurisdiction over an
out-of-state defendant is proper entails a two-part inquiry.
Elecs. for Imaging, Inc. v. Coyle, 340 F.3d 1344,
1349 (Fed. Cir. 2003). First, a district court analyzes and
applies the long arm statute of the state in which it sits to
determine whether personal jurisdiction is proper under
the statute. Id. Second, the court determines whether
exercising jurisdiction over the defendant in the forum
state comports with the Due Process Clause of the U.S.
Constitution. Id. Here, because the district court’s dismissal
of Suunto is premised on its determination that
due process considerations prevented its exercise of
jurisdiction, we consider the due process inquiry first.

Yes, International Shoe is cited:

Due process requires that the defendant have sufficient
“minimum contacts” with the forum state, “such that
the maintenance of the suit does not offend traditional
notions of fair play and substantial justice.” Int’l Shoe Co.
v. Washington, 326 U.S. 310, 316 (1945) (internal quotation
marks and citation omitted). Personal jurisdiction
has two forms: specific and general. AFTG-TG, LLC v.
Nuvoton Tech. Corp., 689 F.3d 1358, 1360 (Fed. Cir.
2012). General jurisdiction is not at issue here.


Because McIntyre did not produce a majority opinion,
we have held that we must follow its narrowest holding,
which is what “can be distilled from Justice Breyer’s
concurrence—that the law remains the same after McIntyre.”
AFTG-TG, 689 F.3d at 1363 (citing Marks v. United
States, 430 U.S. 188, 193 (1977)). Thus, we must follow
our existing precedent. In Beverly Hills Fan Co. v. Royal
Sovereign Corp., 21 F.3d 1558, 1566 (Fed. Cir. 1994), this
court declined to decide which of Justice O’Connor’s and
Justice Brennan’s tests should be adopted because the
outcome of that appeal would be the same under either
test. Subsequent panels have followed that approach, as
the resolution of the cases thus far has not required us to
“take a side on the Asahi divide.” AFTG-TG, 689 F.3d at
1364; see also Celgard, 792 F.3d at 1382; Commissariat a
L’Energie Atomique v. Chi Mei Optoelectronics Corp., 395
F.3d 1315, 1322 & n.7 (Fed. Cir. 2005); Viam Corp. v.
Iowa Export-Import Trading Co., 84 F.3d 424, 428 (Fed.
Cir. 1996).

Suunto loses

We agree with Polar that Suunto has sufficient contacts
with Delaware to sustain specific jurisdiction. The
record shows that Suunto’s actions satisfy the more
stringent tests articulated by Justice O’Connor in Asahi
and by Justice Kennedy in McIntyre, as well as the more
flexible test articulated by Justice Brennan. Specifically,
Suunto purposefully shipped at least ninety-four accused
products to Delaware retailers, fully expecting that its
products would then be sold in Delaware as a result of its
activities. It thus can be said that Suunto’s actions are
purposefully directed to Delaware, indicating an intent
and purpose to serve not only the U.S. market generally,
but also the Delaware market specifically.


We agree with Polar that the district court correctly
applied the dual jurisdiction theory in this case. It may
seem counterintuitive
that the dual jurisdiction theory
does not demand the full satisfaction of any individual
subsection of the Delaware long arm statute. But to date,
no Delaware state court has rejected that theory. Indeed,
the Delaware Supreme Court has had opportunities to
reject the theory, but has declined to do so. See Graphics
Props. Holdings, Inc. v. ASUS Comput. Int’l, 70 F. Supp.
3d 654, 661 (D. Del. 2014) (collecting cases). The district
courts in Delaware have applied the dual jurisdiction
theory in several patent cases. See, e.g., Robert Bosch
LLC v. Alberee Prods., Inc., 70 F. Supp. 3d 665, 672–76
(D. Del. 2014); Graphics Props., 70 F. Supp. 3d at 659–62;
Intellectual Ventures I LLC, v. Ricoh Co., 67 F. Supp. 3d
656, 660–61 (D. Del. 2014); Belden Techs., Inc. v. LS
Corp., 829 F. Supp. 2d 260, 267–68 (D. Del. 2010); Power
Integrations, 547 F. Supp. 2d at 370–74. But see Round
Rock Research LLC v. ASUSTeK Comput. Inc., 967 F.
Supp. 2d 969, 975–78 (D. Del. 2013). Although the Boone
decision is not binding on this court or the district court,
we conclude that the district court did not err in applying
the dual jurisdiction theory in this case.



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