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Indiana doesn’t have jurisdiction in IP suit, rules 7th Circuit

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The 7th Circuit Court of Appeals ordered a District judge to dismiss a case filed by a company with California ties against another California company alleging various IP violations. The judges found Indiana does not have personal jurisdiction over the matter based on emails the allegedly offending company sent.

Advanced Tactical, which manufactures and sells PepperBall branded items, filed its lawsuit against Real Action Paintball Inc. in the Northern District of Indiana, alleging violations of the Lanham Act, common law trademark infringement and unfair competition, trade dress infringement and misappropriation of trade secrets. The lawsuit stems from an email Real Action sent out in 2012 and a message on its website that announced it had acquired the machinery, recipes and materials once used by PepperBall Technologies Inc. But Advanced Tactical had acquired PepperBall Technologies after the business went into foreclosure.

Advanced Tactical claims to have a headquarters in Indiana, but that is unclear, according to the court record. After holding an evidentiary hearing, the District judge concluded the court had personal jurisdiction and that Advanced Tactical was entitled to a preliminary injunction.

The District Court found the necessary minimum contacts based on the following: Real Action fulfilled several orders of the allegedly infringing projectiles for purchasers in Indiana; it knew Advanced Tactical was an Indiana company and could foresee that the misleading emails and sales would harm Advanced Tactical in Indiana; it sent at least two misleading email blasts to a list that included Indiana residents; it had an interactive website available to residents of Indiana; and it put customers on their email list when they made a purchase, thereby giving the company some economic advantage.

But in Advanced Tactical Ordinance Systems Inc. v. Real Action Paintball Inc. and K.T. Tran, 13-3005,  the 7th Circuit found none of these meets the standards the Supreme Court of the United States has set governing specific jurisdiction.

“Specific jurisdiction must rest on the litigation-specific conduct of the defendant in the proposed forum state. The only sales that would be relevant are those that were related to Real Action’s allegedly unlawful activity. Advanced Technical – which has the burden of proof here – has not provided evidence of such sales,” Chief Judge Diane Wood wrote.

“To hold otherwise would mean that a plaintiff could bring suit in literally any state where the defendant shipped at least one item,” she continued.

The act that Real Action maintains an email list to allow it to shower past customers and subscribers with company-related emails doesn’t show a relation between the company and Indiana, the 7th Circuit ruled. “The connection between the place where an email is opened and a lawsuit is entirely fortuitous.”

The judges also found the interactivity of a website is a poor proxy for adequate in-state contacts. The case is remanded with instructions to vacate the judgment and dismiss the case for lack of personal jurisdiction.
 

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  1. A traditional parade of attorneys? Really Evansville? Y'all need to get out more. When is the traditional parade of notaries? Nurses? Sanitation workers? Pole dancers? I gotta wonder, do throngs of admiring citizens gather to laud these marching servants of the constitution? "Show us your billing records!!!" Hoping some video gets posted. Ours is not a narcissistic profession by any chance, is it? Nah .....

  2. My previous comment not an aside at court. I agree with smith. Good call. Just thought posting here a bit on the if it bleeds it leads side. Most attorneys need to think of last lines of story above.

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  4. He must be a Rethuglican, for if from the other side of the aisle such acts would be merely personal and thus not something that attaches to his professional life. AND ... gotta love this ... oh, and on top of talking dirty on the phone, he also, as an aside, guess we should mention, might be important, not sure, but .... "In addition to these allegations, Keaton was accused of failing to file an appeal after he collected advance payment from a client seeking to challenge a ruling that the client repay benefits because of unreported income." rimshot

  5. I am not a fan of some of the 8.4 discipline we have seen for private conduct-- but this was so egregious and abusive and had so many points of bad conduct relates to the law and the lawyer's status as a lawyer that it is clearly a proper and just disbarment. A truly despicable account of bad acts showing unfit character to practice law. I applaud the outcome.

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