Motion to Dismiss for Lack of Personal Jurisdiction Granted Where Supplier of Allegedly Infringing Product Sued for Declaratory Relief After Its Customer Was Sued in a Different Jurisdiction

July 8, 2013

Ball Metal Beverage Container Corp. "(Ball Metal") filed a declaratory judgment action against CMI&J LLC ("CML&J") for non-infringement and invalidity. CML&J moved to dismiss the action for lack of personal jurisdiction, contending that it lacked sufficient minimum contacts with Colorado.

The declaratory judgment action centered on U.S. Patent No. 8,245,866 (the "'866 Patent"), which is directed to a type of beverage container. Three friends created the product embodied in the '866 Patent, Daniel Gibson, Joseph Snecinski, and Todd Epstein. The three friends incorporated CML&J to license the beverage container described in the '866 Patent. Gibson and Snecinski reside in Connecticut, and Epstein resides in Massachusetts. CML&J's place of business is in Connecticut.

As explained by the district court, on April 2012, MillerCoors LLC introduced a Punch Top can in connection with its Miller Lite and Miller Genuine Draft beers. CML&J asserted that the cans infringe the '866 Patent. On October 15, 2012, CML&J filed a patent infringement suit against MillerCoors in the United States District Court for the District of Connecticut and, that same day, CML&J contacted MillerCoors in Chicago, Illinois, telling them of the complaint and inviting a licensing agreement. As further explained by the district court, "[p]laintiff - a Colorado corporation with its principal place of business in this state - responded to this letter, apprising defendant that it was the manufacturer of the Punch Top can and would indemnify MillerCoors from suit. Plaintiff proceeded to set forth in detail the bases for its assertions that its Punch Top cans did not infringe the '866 Patent and that the patent was invalid. (See id., Exh. 4.) A lengthy response from defendant followed, and over the next several months, the parties exchanged a series of letters discussing the merits of defendant's patent claims and possible ways to settle their differences. (See id., Exhs. 5-9.) Ultimately, however, the parties could not reach a resolution. This lawsuit followed."

The district court summarized personal jurisdiction law in patent cases as follows: "[i]n patent law cases, the question whether this court has personal jurisdiction over a defendant is governed by the law of the Federal Circuit. See Red Wing Shoe Co. v. Hockerson-Halberstadt, Inc., 148 F.3d 1355, 1358 (Fed. Cir. 1998). The Federal Circuit, in turn, looks to the relevant state's long-arm statute to determine whether it permits the assertion of personal jurisdiction over the defendant. 3D Systems, Inc. v. Aarotech Laboratories, Inc., 160 F.3d 1373, 1376-77 (Fed. Cir. 1998). Because the Colorado long-arm statute extends personal jurisdiction as far as the federal constitutional requirements of due process permit, Keefe v. Kirschenbaum & Kirschenbaum, P.C., 40 P.3d 1267, 1270 (Colo. 2002), the analysis collapses into a single inquiry as to whether the requirements of due process are satisfied."

The district court found that there were insufficient contacts under the facts described above. "In this case, defendant's contacts with the state of Colorado are based on nothing more than the mere fortuity that plaintiff happens to be a resident of this state. Such has never been sufficient to support the assumption of personal jurisdiction over a
nonresident defendant. See Far West Capital, Inc. v. Towne, 46 F.3d 1071, 1079 (10th Cir. 1995). The parties' communications involved a suit filed against MillerCoors, based in Chicago, Illinois, in a Connecticut federal court. Defendant did not purposefully direct any activity at Colorado; it was plaintiff that opened the exchange by informing defendant that it would be indemnifying MillerCoors from suit."

The district court also concluded that sending the letter to a customer in Illinois could not subject the defendant to personal jurisdiction in Colorado. "Nor does defendant's response informing plaintiff of its alleged rights in the patent make defendant subject to personal jurisdiction in this forum. See Red Wing Shoe Co., 148 F.3d at 1360-61. A patentee must be free to inform a suspected infringer of its claims without undue risk of subjecting itself to suit in the alleged infringer's home forum. See Hildebrand v. Steck Manufacturing Co., 279 F.3d 1351, 1356 (2002) ("[A]n offer to license is so closely akin to an offer to settle that it may not be a separate contact upon which to base jurisdiction."). See also Kash 'n Gold, Ltd. v. ATSPI, Inc., 690 F.Supp. 1160, 1163 (E.D.N.Y. 1988) (noting that tort claims for intentional interference with business relations in patent case "are not reliable bases for jurisdiction")."

Accordingly, the district court granted the motion to dismiss for lack of personal jurisdiction.


Ball Metal Beverage Container Corp. v. CML&J, LLC, Case No. 1:13-cv-00695-REB-MJW (D. Col. June 27, 2013)

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