Catalyst Inc. v. Empathy Catalyst Consulting

[3] 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA [6] 7 CATALYST INC., Case No. 24-cv-02557-SI 8 Plaintiff, ORDER VACATING JANUARY 17, 2025 HEARING ON MOTION TO 9 v. DISMISS FOR LACK OF PERSONAL JURISDICTION AND GRANTING 10 EMPATHY CATALYST CONSULTING, PLAINTIFF'S REQUEST TO ALLOW JURISDICTIONAL DISCOVERY 11 Defendant. [12] Defendant Empathy Catalyst Consulting’s motion to dismiss for lack of personal jurisdiction [13] is scheduled for a hearing on January 17, 2025. After review of the parties’ papers, the Court [14] concludes that it is appropriate to defer ruling on the motion to allow for jurisdictional discovery. [15] Accordingly, the January 17 hearing is VACATED. The parties are directed to promptly meet and 16 confer regarding (1) a timeframe for Catalyst to take jurisdictional discovery and (2) a timeframe 17 for the parties to file supplemental briefs regarding the issue of personal jurisdiction, once 18 jurisdictional discovery is complete. By January 24, 2025, the parties shall either file a stipulation 19 regarding these matters, or they shall file a case management conference statement setting forth the 20 competing proposed timelines, and the Court will address the timeframe at the January 31, 2025 21 initial case management conference. [22] DISCUSSION [23] Plaintiff Catalyst Inc. (“Catalyst”) filed this lawsuit against defendant Empathy Catalyst [24] Consulting (“Empathy Catalyst”), alleging claims for trademark infringement and unfair [25] competition under federal and state law. Catalyst “is a global advisory, consulting, and research [26] nonprofit organization that has been working to build inclusive environments and expand [27] opportunities for women in business and the professions for over 60 years.” Compl. ¶ 2. Catalyst 1 provides advisory and consulting services and materials on diversity, equity and inclusion (“DEI”) 2 to more than 400 public companies, private businesses, and other organizations, including entities in this District. Id. Catalyst is a not-for-profit consulting organization organized under the laws of [3] Ohio, with its principal place of business in New York, New York. Id. ¶ 15. Catalyst has registered [4] the CATALYST trademark “for a wide variety of goods and services related to its mission of [5] empowering women in the workplace and promoting DEI, including consulting services, [6] publications, and conferences.” Id. ¶ 6. The CATALYST mark has been registered since 1984 and [7] is incontestable. Id. ¶¶ 6, 35. The CATALYST mark is also registered in Canada. Id. ¶¶ 6, 36. [8] Defendant Empathy Catalyst is a for-profit consulting firm that has its principal place of [9] business in Vancouver, Canada. Id. ¶ 16. Empathy Catalyst provides consultancy services focused [10] on DEI, and it offers education, consultation, facilitation, mediation and coaching. Id. ¶¶ 7-8. The [11] complaint alleges that Empathy Catalyst has clients in Canada and the United States, including in [12] this District, and that Empathy Catalyst uses the CATALYST mark in connection with events in [13] both countries, which it promotes using its social media platforms. Id. ¶¶ 9-10. Catalyst claims that [14] Empathy Catalyst’s U.S. clients include Big West Rotaract (San Jose, California), Montrose [15] Recreation District (Montrose, Colorado), Montrose Black Canyon Rotary (Montrose, Colorado), [16] the city of Montrose, Colorado, and The Ready (“fully distributed across the U.S.” according to [17] LinkedIn), and that Empathy Catalyst hosted a virtual DEI event for Big West Rotaract in 2021. [18] Catalyst also claims that Empathy Catalyst advertised, and may have hosted, an in-person event in [19] Hermosa Beach, California in 2021. Catalyst also emphasizes that Empathy Catalyst’s website and [20] social media has advertised United States-based events and that Empathy Catalyst’s website and [21] social media are accessible in the United States. [22] On December 9, 2024, Empathy Catalyst filed a motion to dismiss for lack of personal [23] jurisdiction and improper venue. Empathy Catalyst contends that this Court lacks personal [24] jurisdiction because it does not have any connection to California. Empathy Catalyst has filed the [25] declaration of Alia Ali, the founder and principal of Empathy Catalyst. Ali states, inter alia, that [26] she founded Empathy Catalyst in 2021, that all of its clients are Canadian, and that it has never had [27] a client in California. Ali Decl. ¶¶ 3-4. Ali denies the allegations of the complaint and specifically 1 denies having hosted an event in Hermosa Beach or doing work for Big West Rotaract. Id. ¶¶ 102 11. In response to the Ali declaration, Catalyst has submitted screenshots from Empathy Catalyst’s 3 website and social media in support of its assertion that Empathy Catalyst has had clients in 4 California. 5 Catalyst contends that this Court has specific jurisdiction over Empathy Catalyst. The Ninth 6 Circuit has articulated three requirements for establishing specific jurisdiction over a non-resident 7 defendant: 8 (1) the defendant must either purposefully direct his activities toward the forum or purposefully avail himself of the privileges of conducting activities in the forum; (2) 9 the claim must be one which arises out of or relates to the defendant’s forum-related activities; and (3) the exercise of jurisdiction must comport with fair play and 10 substantial justice, i.e. it must be reasonable. 11 Axiom Foods, Inc. v. Acerchem Int’l, Inc., 874 F.3d 1064, 1068 (9th Cir. 2017) (alterations and 12 quotations omitted). The plaintiff bears the burden of satisfying the first two prongs of the test, and 13 if the plaintiff fails to satisfy either prong, then the district court does not have personal jurisdiction 14 over the defendant. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 802 (9th Cir. 2004). 15 If the plaintiff satisfies both prongs, then the burden shifts to the defendant to present a “compelling 16 case” that the exercise of jurisdiction would not be reasonable under the third prong. Burger King 17 Corp. v. Rudzewicz, 471 U.S. 462 , 476–78 (1985). All three prongs of the test must be met for the 18 district court to exercise personal jurisdiction over the defendant. 19 The parties’ briefing applies the purposeful direction test. See also Ayla, LLC v. Alya Skin 20 Pty. Ltd., 11 F.4th 972 , 979 (9th Cir. 2021) (“Trademark infringement is treated as tort-like for 21 personal jurisdiction purposes, and so we focus on purposeful direction here.”). A defendant 22 purposefully directs activity at the forum state when the defendant “(1) [has] committed an 23 intentional act, (2) expressly aimed at the forum state, (3) causing harm the defendant knows is 24 likely to be suffered in the forum state.” Dole Foods Co., Inc. v. Watts, 303 F.3d 1104, 1111 (9th 25 Cir. 2002) (citing Bancroft, 223 F.3d at 1087). A defendant’s contacts with a forum “would be 26 insufficient if they were ‘random, isolated, or fortuitous.’” Ayla, 11 F.4th at 981 (quoting Keeton v. 27 Hustler Mag., Inc., 465 U.S. 770, 774 (1984)). 1 activity at California. Catalyst’s opposition to defendant’s motion requests leave to conduct 2 || jurisdictional discovery. “Discovery should ordinarily be granted where ‘pertinent facts bearing on 3 the question of jurisdiction are controverted or where a more satisfactory showing of the facts is 4 || necessary.’” Butcher’s Union Loc. No. 498, United Food & Com. Workers v. SDC Inv., Inc., 788 5 F.2d 535, 540 (9th Cir. 1986) Gnternal citation omitted). The Court finds that the record is 6 || insufficiently developed to resolve personal jurisdiction and that “further discovery . . . might well 7 demonstrate facts sufficient to constitute a basis for jurisdiction.” Harris Rutsky & Co. Ins. Servs., 8 || Inc. v. Bell & Clements Ltd., 328 F.3d 1122, 1135 (9th Cir. 2003). Accordingly, the Court GRANTS 9 || Catalyst’s request to take jurisdictional discovery and DEFERS ruling on the pending motion to 10 || dismiss until that discovery is conducted and the parties have filed supplemental briefs regarding 11 || jurisdiction. a 12 IT IS SO ORDERED. 15 || Dated: January 15, 2025 2 SUSAN ILLSTON A 16 United States District Judge it 4 18