Judge Robinson Denies Motion to Dismiss for Lack of Personal Jurisdiction Without Prejudice
March 1, 2016
Publication| Intellectual Property
In DNA Genotek Inc. v. Spectrum DNA, C.A. No. 15-661 (D. Del. Feb. 4, 2016), Judge Robinson denied a motion to dismiss for lack of personal jurisdiction filed by defendants Spectrum DNA, Spectrum Solutions LLC, and Spectrum Packaging LLC (collectively, “Spectrum”), with leave to renew following jurisdictional discovery. Plaintiff DNA Genotek Inc. (“Genotek”) initiated the patent infringement action against Spectrum for manufacturing an allegedly infringing saliva DNA collection device. Spectrum argued that it had no contacts with Delaware sufficient to establish personal jurisdiction there, but Genotek alleged that Spectrum was subject to Delaware’s long-arm statute under a “dual jurisdiction” or “stream of commerce” theory. Specifically, Genotek argued that Spectrum’s sale of the accused product to Ancestry, a genealogy research service, was sufficient “additional conduct” indicating Spectrum’s “intent or purpose” to serve the Delaware market, since Ancestry subsequently placed Spectrum’s product into the stream of commerce, has nationwide sales that include Delaware, and specifically targets the Delaware market.
Judge Robinson noted that, with the exception of delivering its product to Ancestry (itself located outside of Delaware), the current record did not show Spectrum intended to serve the Delaware market. There was as yet no indication that Spectrum actually shipped the accused product to Delaware or sold it in the state, or had any control over Ancestry’s actions regarding the accused product after delivering its product into Ancestry’s possession. Nor did the Court find any indication that potential customers could order the accused product directly from Spectrum online.
Judge Robinson distinguished these facts from cases finding personal jurisdiction, in which the nonresident defendant specifically engaged a third-party distributor to solicit business from or to resell its products throughout the entire country (expressly providing for Delaware). Instead, the Court found these facts closer to decisions finding no personal jurisdiction, such as when agreements with distributors did not mention Delaware as a target area for sales.
In light of the business relationship between Spectrum and Ancestry and questions regarding Spectrum’s marketing and sales activities, Judge Robinson ordered jurisdictional discovery to supplement the facts in the record regarding Spectrum’s contacts with Delaware. Accordingly, Judge Robinson denied the defendant’s motion to dismiss without prejudice to renew.
Analysis: Because of the limited record available to the Court on motions to dismiss for lack of personal jurisdiction, jurisdictional discovery is not unusual.