Spy Optic Inc. v. AreaTrend, LLC

[7] 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA [10] 11 SPY OPTIC INC., a California Case No.: 3:19-cv-01770-WQH-BLM Corporation, 12 ORDER Plaintiff, [13] v. [14] AREATREND, LLC, an Ohio 15 Limited Liability Company; and DOES 1-10, [16] Defendants. [17] 18 HAYES, Judge: 19 The matter pending before the Court is the Motion to Dismiss filed by Defendant 20 AreaTrend, LLC (ECF No. 7). 21 PROCEDURAL BACKGROUND 22 On September 16, 2019, Plaintiff Spy Optic Inc. (“Spy Optic”) initiated this action 23 by filing a Complaint against Defendant AreaTrend, LLC (“AreaTrend”) for (1) federal 24 trademark infringement and counterfeiting; (2) federal false designation of origin; (3) 25 tortious interference with existing contractual relations; (4) California common law 26 trademark infringement; (5) California common law unfair competition; and (6) California 27 statutory unfair competition. (ECF No. 1). On October 24, 2019, Defendant filed a Motion 28 to Dismiss for lack of personal jurisdiction. (ECF No. 7). On November 18, 2019, Plaintiff 1 filed a Response in opposition. (ECF No. 12). On November 19, 2019, Plaintiff filed a 2 Supplemental Declaration in opposition. (ECF No. 13). On November 25, 2019, 3 Defendant filed a Reply. (ECF No. 14). 4 ALLEGATIONS OF THE COMPLAINT 5 Plaintiff engages “in the extensive development, advertising, and marketing of 6 sunglasses, sunglass products, wearing apparel and sporting goods.” (ECF No. 1 at 3). 7 Plaintiff “uses and has used the trademarks ‘SPY’, ‘SPY OPTIC’ and a cross logo, among 8 others, in connection with its goods and/or services” (collectively, “Spy Marks”). Id. The 9 Spy Marks “are valid, subsisting, in full force and effect, and are incontestable pursuant to [10] 15 U.S.C. § 1065 .” Id. at 4 . Plaintiff has “continuously used the S[py] Marks in interstate 11 commerce in connection with the sale, distribution, promotion, and advertising of genuine 12 Spy Optic® products since their respective dates of first use.” Id. “The Spy Marks have 13 never been abandoned.” Id. Plaintiff has “expended substantial time, money, and other 14 resources in developing, advertising, and otherwise promoting the Spy Marks.” Id. The 15 Spy Marks “are widely recognized and exclusively associated by consumers, the public, 16 and the trade as being high-quality products sourced from Spy Optic.” Id. The Spy Marks 17 “have achieved secondary meaning as an identifier of high-quality sunglasses, sunglass 18 products, apparel, and sporting goods.” Id. The Spy Marks “have come to symbolize the 19 enormous goodwill of Spy Optic and its products throughout the United States and the 20 world.” Id. “No other manufacturer lawfully uses the Spy Marks or any marks 21 substantially similar to them in connection with similar types of goods.” Id. Plaintiff 22 “suffers irreparable harm to its goodwill as well as a direct monetary loss any time any 23 third parties, including Defendant, sell counterfeit and infringing goods bearing trademarks 24 identical or substantially indistinguishable from Spy Marks.” Id. 25 “Defendant is an online retailer of various brand-name products including clothing, 26 accessories, and home décor via its website, www.areatrend.com ….” Id. at 5 . “Defendant 27 has purchased, advertised, offered for sale, and/or sold eyewear bearing the Spy Marks” on 28 its website, despite not being “an authorized retailer of Spy Optic® branded goods.” Id. 1 [I]t is reasonable to conclude that these goods are either counterfeit, infringing, obtained from entities who are prohibited from selling said goods [2] to Defendant pursuant to the contractual relationship they have with Plaintiff 3 regarding the distribution of goods as described above, or a combination thereof. [5] Id. Defendant has “received actual notice to cease and desist from its improper acquisition 6 and deceptive promotion and sale of products bearing the Spy Marks ….” Id. at 5-6 . 7 Defendant continues to “wrongfully purchase, advertise, promote, offer for sale, and/or 8 sell” eyewear bearing the Spy Optics trademarks “on its website.” Id. at 6 . 9 STANDARD OF REVIEW 10 Under Federal Rule of Civil Procedure 12(b)(2), a defendant may move to dismiss a 11 complaint for lack of personal jurisdiction. See Fed. R. Civ. P. 12(b)(2). In opposing a 12 defendant’s Rule 12(b)(2) motion, “the plaintiff bears the burden of establishing that 13 jurisdiction is proper.” Boschetto v. Hansing, 539 F.3d 1011, 1015 (9th Cir. 2008) (citation 14 omitted). Where the court considers the motion without holding an evidentiary hearing, 15 “the plaintiff need only make a prima facie showing of jurisdictional facts to withstand the 16 motion to dismiss.” Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218, 1223 (9th 17 Cir. 2011) (citing Brayton Purcell LLP v. Recordon & Recordon, 606 F.3d 1124, 1127 (9th 18 Cir. 2010), abrogated on other grounds as recognized by Axiom Foods, Inc. v. Acerchem 19 Int’l, Inc., 874 F.3d 1064 (9th Cir. 2017)). “The plaintiff cannot ‘simply rest on the bare 20 allegations of its complaint,’ but uncontroverted allegations in the complaint must be taken 21 as true.” Id. (quoting Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th 22 Cir. 2004)). “[W]e may not assume the truth of allegations in a pleading which are 23 contradicted by affidavit ... but we resolve factual disputes in the plaintiff’s favor.” Id. 24 (alteration in original) (internal quotation marks, quotation, and citation omitted). In other 25 words, “the plaintiff need only demonstrate facts that if true would support jurisdiction 26 over the defendant.” Ballard v. Savage, 65 F.3d 1495, 1498 (9th Cir. 1995) (citation 27 omitted). [28] 1 CONTENTIONS OF THE PARTIES 2 Defendant contends that Plaintiff’s Complaint should be dismissed for lack of 3 personal jurisdiction. Defendant contends that the maintenance of an interactive website 4 is insufficient to support general jurisdiction over a foreign defendant. Defendant asserts 5 that it has no employees or offices in California. Defendant asserts that it derives a trivial 6 amount of sales from California. Defendant contends that this Court lacks specific 7 jurisdiction. Defendant contends that it has not purposefully directed activities at 8 California or purposefully availed itself of the privilege of conducting activities in 9 California. Defendant contends that it has no California contacts that could be the but-for 10 cause of Plaintiff’s alleged injury. Defendant contends that the exercise of jurisdiction in 11 California would be constitutionally unreasonable. 12 Plaintiff contends that there is general jurisdiction over Defendant because 13 Defendant operates a highly interactive website through which California consumers can 14 purchase products. Plaintiff contends that there is specific jurisdiction over Defendant. 15 Plaintiff contends that the highly commercial nature of Defendant’s website constitutes 16 purposeful availment. In the alternative, Plaintiff contends that the purposeful availment 17 element is satisfied based on Defendant’s tortious conduct directed at the forum. Plaintiff 18 contends that Defendant committed an intentional act expressly aimed at California causing 19 foreseeable harm to Plaintiff in California by continuing to sell and ship eyewear bearing 20 the Spy Marks to California after receiving a cease and desist letter from Plaintiff. Plaintiff 21 contends that Defendant has failed to meet its burden of showing that the exercise of 22 personal jurisdiction would be unreasonable. 23 DISCUSSION 24 “Federal courts apply state law to determine the bounds of their jurisdiction over a 25 party.” Axiom Foods, 874 F.3d at 1067 (citation omitted). “California authorizes its courts 26 ‘to exercise jurisdiction to the full extent that such exercise comports with due process.’” [27] Id. (citation omitted); see also Cal. Civ. Proc. Code § 410.10 (“A court of this state may 28 exercise jurisdiction on any basis not inconsistent with the Constitution of this state or of 1 the United States.”). “Accordingly, ‘the jurisdictional analyses under [California] state law 2 and federal due process are the same.’” Axiom Foods, 874 F.3d at 1067 (quoting Mavrix 3 Photo, 647 F.3d at 1223 ) (alteration in original). “There are two forms of personal 4 jurisdiction that a forum state may exercise over a nonresident defendant–general 5 jurisdiction and specified jurisdiction.” Boschetto, 539 F.3d at 1016 . 6 1. General Jurisdiction 7 “[A] finding of general jurisdiction permits a defendant to be haled into court in the 8 forum state to answer for any of its activities in the world.” Schwarzenegger, 374 F.3d at 9 801 (citation omitted). The standard for general jurisdiction “is an exacting standard ….” [10] Id. (citation omitted). For general jurisdiction to exist, a defendant’s affiliations with the 11 forum state must be “so ‘continuous and systematic’ as to render them essentially at home 12 in the forum State.” Daimler AG v. Bauman, 571 U.S. 117, 127 (2014) (quoting Goodyear 13 Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011)). To determine whether 14 a nonresident defendant’s contacts are sufficiently substantial, continuous, and systematic, 15 the Court of Appeals considers their “[l]ongevity, continuity, volume, economic impact, 16 physical presence, and integration into the state’s regulatory or economic markets ….” 17 Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163, 1172 (9th Cir. 2006). In the case of 18 a corporation, “[t]he paradigmatic locations where general jurisdiction is appropriate over 19 a corporation are its place of incorporation and its principal place of business.” Ranza v. 20 Nike, Inc., 793 F.3d 1059, 1069 (9th Cir. 2015) (citing Daimler, 571 U.S. at 137 ). “Only 21 in an ‘exceptional case’ will general jurisdiction be available anywhere else.” Martinez v. 22 Aero Caribbean, 764 F.3d 1062, 1070 (9th Cir. 2014) (quoting Daimler, 571 U.S. at 139 23 n. 19). 24 The Court of Appeals has found that “t[h]e level of interactivity of a nonresident 25 defendant’s website provides limited help in answering the distinct question whether the 26 defendant’s forum contacts are sufficiently substantial, continuous, and systematic to 27 justify general jurisdiction.” Mavrix Photo, 647 F.3d at 1227 (citation omitted). 28 “Interactive websites where a user can exchange information with the host computer … are 1 now extremely common.” CollegeSource, Inc. v. AcademyOne, Inc., 653 F.3d 1066 , 1075 2 (9th Cir. 2011) (internal quotation marks and citation omitted). “If the maintenance of an 3 interactive website were sufficient to support general jurisdiction in every forum in which 4 users interacted with the website, ‘the eventual demise of all restrictions on the personal 5 jurisdiction of state courts’ would be the inevitable result.” Id. at 1075-76 (quoting World6 Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 294 (1980)). 7 Defendant is “an Ohio limited liability company with its principal place of business 8 located [in] North Canton, OH ….” Kasper Decl. ¶ 3, ECF No. 7-2 at 2. Defendant “is not 9 and never has been registered to do business in California.” Id. ¶ 4, ECF No. 7-2 at 2. 10 Defendant does not have any “executives or employees [who] regularly travel to California 11 for business purposes.” Id. ¶ 5, ECF No. 7-2 at 2. Defendant “does not advertise nor 12 market products in California.” Id. ¶ 6, ECF No. 7-2 at 2. Defendant “does not have any 13 offices, sales representatives, warehouse facilities, suppliers, toll free telephone numbers 14 or other business associations in California.” Id. ¶ 7, ECF No. 7-2 at 2. 15 The “operation of an interactive website—even a ‘highly interactive’ website—does 16 not confer general jurisdiction.” Mavrix Photo, 647 F.3d at 1226 ; see also CollegeSource, [17] 653 F.3d at 1075-76 (“If the maintenance of an interactive website were sufficient to 18 support general jurisdiction in every forum in which users interacted with the website, ‘the 19 eventual demise of all restrictions on the personal jurisdiction of state courts’ would be the 20 inevitable result.”). The Court concludes that Plaintiff has failed to present sufficient 21 evidence to meet the “exacting standard” necessary to establish general jurisdiction. 22 Schwarzenegger, 374 F.3d at 801 (citation omitted). 23 2. Specific Jurisdiction 24 “The inquiry whether a forum State may assert specific jurisdiction over a 25 nonresident defendant ‘focuses on the relationship among the defendant, the forum, and 26 the litigation.’” Axiom Foods, 874 F.3d at 1068 (quoting Walden v. Fiore, 571 U.S. 277 , 27 283-84 (2014)). “Two principles animate the ‘defendant-focused’ inquiry.” Id. (quoting 28 Walden, 571 U.S. at 284). “First, the relationship between the nonresident defendant, the 1 forum, and the litigation ‘must arise out of contacts that the defendant himself creates with 2 the forum state.’” Id. (quoting Walden, 571 U.S. at 284 ) (emphasis in original). “Second, 3 the minimum contacts analysis examines ‘the defendant’s contacts with the forum State 4 itself, not the defendant’s contacts with persons who reside there.’” Id. (quoting Walden, 5 571 U.S. at 285). “It follows that ‘a defendant’s relationship with a plaintiff or third party, 6 standing alone, is an insufficient basis for jurisdiction.’” Id. (quoting Walden, 571 U.S. at 7 286). 8 “In a specific jurisdiction inquiry, we consider the extent of the defendant’s contacts 9 with the forum and the degree to which the plaintiff's suit is related to those contacts.” 10 Yahoo! Inc. v. La Ligue Contre Le Racisme Et L’Antisemitisme, 433 F.3d 1199, 1210 (9th 11 Cir. 2006). “A strong showing on one axis will permit a lesser showing on the other.” Id. 12 “While ‘a single act can support jurisdiction’” in a tort case, “the act must first ‘create[ ] a 13 substantial connection with the forum.’” Axiom Foods, 874 F.3d at 1068 . (quoting Burger 14 King Corp. v. Rudzewicz, 471 U.S. 462 , 475 n.18 (1985)) (alteration in original) (internal 15 quotation marks omitted). “Put differently, ‘some single or occasional acts related to the 16 forum may not be sufficient to establish jurisdiction if their nature and quality and the 17 circumstances of their commission create only an attenuated affiliation with the forum.’” [18] Id. (quoting Burger King, 471 U.S. at 475 n.18) (internal quotation marks omitted). “A 19 defendant’s ‘random, fortuitous, or attenuated contacts’ will not suffice.” Id. (quoting 20 Walden, 571 U.S. at 286) (internal quotation marks omitted). 21 The Court of Appeals employs a three-prong test to assess whether a defendant’s 22 contacts with the forum state are sufficient to subject it to specific jurisdiction: 23 (1) the defendant must either “purposefully direct his activities” toward the forum or “purposefully avail[ ] himself of the privileges of conducting [24] activities in the forum”; 25 (2) “the claim must be one which arises out of or relates to the defendant’s forum-related activities”; and [26] (3) “the exercise of jurisdiction must comport with fair play and substantial 27 justice, i.e., it must be reasonable.” [28] 1 Id. (quoting Dole Food Co. v. Watts, 303 F.3d 1104, 1111 (9th Cir. 2002)) (alteration in 2 original). “The plaintiff bears the burden of satisfying the first two prongs of the test.” Id. 3 (quoting Schwarzenegger, 374 F.3d at 802 ). “If the plaintiff meets that burden, ‘the burden 4 then shifts to the defendant to present a compelling case that the exercise of jurisdiction 5 would not be reasonable.’” Id. at 1068-69 (quoting Burger King, 471 U.S. at 476-78 ) 6 (internal quotation marks omitted). 7 a. Purposeful Direction 8 For causes of action sounding in tort, the Court of Appeals applies the purposeful 9 direction test, rather than the purposeful availment test, which generally applies to claims 10 arising from a contract. See id. at 1069 (“Where, as here, a case sounds in tort, we employ 11 the purposeful direction test.”). Alleged trademark infringement qualifies as tortious 12 conduct under the Calder effects test. See Rio Properties, Inc. v. Rio Int’l Interlink, 284 13 F.3d 1007, 1019-20 (9th Cir. 2002) (applying Calder effects test to case involving 14 trademark infringement). The purposeful direction test, “often referred to as the ‘effects’ 15 test, derives from Calder v. Jones, 465 U.S. 783 … (1984).” Axiom Foods, 874 F.3d at 16 1069 (citation omitted). To satisfy the Calder purposeful direction test, “[t]he defendant 17 must have ‘(1) committed an intentional act, (2) expressly aimed at the forum state, (3) 18 causing harm that the defendant knows is likely to be suffered in the forum state.’” Id. 19 (citation omitted). 20 1) Intentional Act 21 The first prong of the purposeful direction inquiry requires that the defendant 22 committed an intentional act. The Court of Appeals “construe[s] ‘intent’ in the context of 23 the ‘intentional act’ test as referring to an intent to perform an actual, physical act in the 24 real world, rather than an intent to accomplish a result or consequence of that act.” 25 Schwarzenegger, 374 F.3d at 806 . 26 Plaintiff alleges that “Defendant has purchased, advertised, offered for sale, and/or 27 sold eyewear bearing the Spy Marks” on its website, despite not being “an authorized 28 retailer of Spy Optic® branded goods.” (ECF No. 1 at 5). Plaintiff alleges that Defendant 1 continues to “wrongfully purchase, advertise, promote, offer for sale, and/or sell” eyewear 2 bearing the Spy Optics trademarks “on its website.” Id. at 6. 3 Plaintiff submitted supporting exhibits of Defendant’s website from November 12, 4 2019 featuring eyewear bearing the Spy Marks (Ex. A to Blakley Decl., ECF No. 12-1 at 5 6-8) and Defendant’s Amazon website from November 18, 2019 featuring eyewear bearing 6 the Spy Marks (Ex. G to Blakley Decl., ECF No. 12-1 at 32-45). Plaintiff submitted a 7 supporting exhibit of Defendant’s website from November 12, 2019 featuring “Add to 8 Cart” and “Buy Now” options, which facilitate customer purchases. (Ex. B to Blakley 9 Decl., ECF No. 12-1 at 10). Plaintiff submitted a supporting exhibit of Defendant’s website 10 from November 12, 2019 featuring the “Contact Us!” webpage, which lists Defendant’s 11 phone numbers, email address, and live chat option. (Ex. C to Blakley Decl., ECF No. 1212 1 at 13). Plaintiff submitted a supporting exhibit of Defendant’s website from November 13 12, 2019 featuring the “Sign Up” webpage, which allows customers to create an account 14 with Defendant. (Ex. D to Blakley Decl., ECF No. 12-1 at 16). This constitutes prima 15 facie evidence of intentional acts within the meaning of Calder. The Court finds that 16 Plaintiff has carried the burden to show an intentional act by Defendant. Plaintiff has made 17 a prima facie showing that Defendant advertised and sold eyewear bearing the Spy Marks. 18 Loomis v. Slendertone Distribution, Inc., No. 3:19-cv-854-MMA (KSC), 2019 WL 19 5790136, at *10 (S.D. Cal. Nov. 6, 2019) (“Because Defendants developed, advertised, 20 and sold the product, the Court finds Plaintiff has carried her burden to show an intentional 21 act by Defendant.”). The Court concludes that the first prong of the Calder test is satisfied. 22 2) Express Aiming 23 The second prong of the purposeful direction inquiry is whether the defendant 24 expressly aimed its conduct at the forum state. A plaintiff must demonstrate that California 25 is the “focal point” of both the claims and the harm suffered. Axiom Foods, 874 F.3d at 26 1071 (quoting Walden, 571 U.S. at 287 ). A plaintiff must prove that “the ‘effects’ caused 27 by the defendants’ [conduct]—i.e., the injury to the plaintiff[] …—connected the 28 defendants’ conduct to California, not just to a plaintiff who lived there.” Walden, 571 1 U.S. at 288 (emphasis in original). The express aim of the defendant must pertain to the 2 forum state, “not the defendant’s contacts with a resident of the forum.” Picot v. Weston, [3] 780 F.3d 1206, 1214 (9th Cir. 2015). A plaintiff does not show express aiming if “none of 4 [the] challenged conduct ha[s] anything to do with California itself.” Id. at 1215 (quoting 5 Walden, 571 U.S. at 289). A plaintiff does not demonstrate express aiming by alleging 6 injuries that are “entirely personal to him and would follow him wherever he might choose 7 to live or travel” and are “not tethered to California in any meaningful way.” Id. 8 The Court of Appeals has explained that 9 we have struggled with the question whether tortious conduct on a nationally accessible website is expressly aimed at any, or all, of the forums in which the [10] website can be viewed…. On the one hand, we have made clear that 11 “maintenance of a passive website alone cannot satisfy the express aiming prong.” … On the other, we have held that “operating even a passive website [12] in conjunction with ‘something more’—conduct directly targeting the 13 forum—is sufficient.” … In determining whether a nonresident defendant has done “something more,” we have considered several factors, including the [14] interactivity of the defendant’s website, … the geographic scope of the 15 defendant’s commercial ambitions, … and whether the defendant “individually targeted” a plaintiff known to be a forum resident …. [16] 17 Mavrix Photo, 647 F.3d at 1229 (citations omitted). The Court of Appeals has further 18 explained that 19 We have held that “individualized targeting” satisfies the express aiming requirement…. In the context of copyright infringement, we have held that a [20] defendant’s “alleged willful infringement of [a plaintiff’s] copyright, and its 21 knowledge of both the existence of the copyright and the forum of the copyright holder,” established “individualized targeting.” … In Walden, the [22] Supreme Court rejected our conclusion that the defendants’ “knowledge of 23 [the plaintiffs’] ‘strong forum connections,’” plus the “foreseeable harm” the plaintiffs suffered in the forum, comprised sufficient minimum contacts…. [24] The Court found that our approach “impermissibly allow[ed] a plaintiff's 25 contacts with the defendant and forum to drive the jurisdictional analysis.” … The Court made clear that we must look to the defendant’s “own contacts” [26] with the forum, not to the defendant’s knowledge of a plaintiff’s connections 27 to a forum…. Following Walden, we now hold that while a theory of individualized targeting may remain relevant to the minimum contacts [28] 1 inquiry, it will not, on its own, support the exercise of specific jurisdiction, absent compliance with what Walden requires. [2] 3 Axiom Foods, 874 F.3d at 1069-70 (citations omitted). 4 Plaintiff alleges that it “is incorporated under the laws of the state of California with 5 a principal place of business located [in] … Carlsbad, California ….” (ECF No. 1 at 2). 6 Plaintiff alleges that Defendant “is a limited liability company duly organized and existing 7 under the laws of the State of Ohio with a principal place of business located [in] … North 8 Canton, Ohio ….” Id. Plaintiff alleges that Plaintiff “served Defendant with a cease and 9 desist letter informing Defendant that ‘[a]ll Spy Optic authorized sources are strictly 10 prohibited from transshipping and/or reselling any Spy Optic-branded products to any 11 entity that sells such products’” on December 20, 2018. Id. at 9 (emphasis in original). 12 Plaintiff alleges that “[t]he letter further requested that Defendant cease and desist selling 13 Spy Optic branded products.” Id. Plaintiff alleges that “[d]espite having received actual 14 notice to cease and desist from its improper acquisition and deceptive promotion and sale 15 of products bearing the Spy Marks, Defendant has continued to wrongfully purchase, 16 advertise, promote, offer for sale, and/or sell” eyewear bearing the Spy Optics trademarks 17 “on its website.” Id. at 5-6. 18 In his declaration, Plaintiff’s Counsel states that 19 [Plaintiff] is a corporation organized and existing under the laws of the state of California with an office and principal place of business in Carlsbad, [20] California. [21] Blakley Decl. ¶ 2, ECF No. 12-1 at 2. In his declaration, Plaintiff’s Vice President of [22] Revenue states that [23] On February 3, 2017 I made two purchases of [eyewear bearing the Spy Optics [24] trademarks] from Areatrend via the Areatrend storefront on Amazon, which 25 were shipped and delivered to me in Carlsbad California. [26] (ECF No. 13 at 2). Plaintiff’s Vice President of Revenue cites to a supporting exhibit of a [27] purchase receipt from February 2, 2017 featuring a February 3, 2017 shipping date; the [28] 1 name, description, and price of two items; a Carlsbad, California shipping address; and 2 payment and billing information. Ex. A to Ninegar Decl., ECF No. 13-1 at 2. 3 In his declaration, Plaintiff’s Counsel states that 4 Despite having received actual notice to cease and desist from its improper acquisition and deceptive promotion and sale of products bearing the Spy [5] Marks, Defendant has continued to wrongfully purchase, advertise, promote, 6 offer for sale, and/or sell [eyewear bearing the Spy Optics trademarks] on its website. [7] 8 Blakley Decl. ¶ 12, ECF No. 12-1 at 4. 9 Plaintiff submitted a supporting exhibit of Plaintiff’s cease and desist letter sent to 10 Defendant on December 20, 2018. Ex. E to Blakley Decl., ECF No. 12-1 at 19-20. The 11 cease and desist letter is addressed to “Defendant’s Chief Executive Officer” from “Brent 12 Blakely of the Blakely Law Group.” Id. at 19. The cease and desist letter states, in relevant 13 part, 14 We are counsel for Spy Optic (“Spy Optic”).… Spy Optic eyewear is being advertised, offered for sale, and sold on Area Trend’s website which it did not [15] receive directly from Spy Optic. Consequently, it is reasonable to conclude 16 that the unauthorized Spy Optic eyewear sold by Area Trend is either counterfeit or was obtained from entities who are prohibited from selling said [17] goods to Area Trend pursuant to the contractual relationship they have with 18 Spy Optic regarding the distribution of goods as described above. To the extent you’re are not already on notice, you are hereby put on notice of Spy [19] Optic’s contractual relationship with its authorized sources, and you will be 20 liable for all damages sustained as a result of further interference with these contracts. Based on the foregoing, we hereby demand on behalf of Spy Optic [21] that Area Trend: 22 (1) Immediately cease and desist further purchase, advertisement, marketing, promotion, distribution, offering for sale, and/or sale Spy Optic branded [23] products; 24 (2) Surrender your remaining inventory of Spy Optic branded products to Spy Optic; and [25] (3) Provide full disclosure, including production of documents, regarding 26 Area Trend’s source for Spy Optic branded products, including information regarding (a) from whom Area Trend obtained Spy Optic products; (b) [27] amount purchased; (c) amount sold; and (d) amount in current inventory. [28] 1 Id. at 19-20. The letterhead lists the following California address for the Blakely Law 2 Group: “1334 PARKVIEW AVENUE, SUITE 280, MANHATTAN BEACH, 3 CALIFORNIA 90266.” Id. at 19. 4 In his declaration, Defendant’s Chief Executive Officer states that 5 I am the Chief Executive Officer of Areatrend, which is an Ohio limited liability company with its principal place of business located at 7584 Whipple [6] Ave. NW, North Canton, OH 44720. Areatrend is not and never has been 7 registered to do business in California. No executives or employees of Areatrend regularly travel to California for business purposes. Areatrend does [8] not advertise nor market products in California. Areatrend does not have any 9 offices, sales representatives, warehouse facilities, suppliers, toll free telephone numbers or other business associations in California. AreaTrend [10] sells products through it own website www.areatrend.com, as well as through 11 third-party online retailers. Areatrend’s website allows a third-party to purchase a product, but Areatrend does not maintain a mailing list, [12] membership club, or any other method of creating an ongoing relationship 13 with anyone, much less anyone from California. Areatrend’s sales to California are nominal. Total sales to California of all products Areatrend sells [14] through all channels represent 4.7 % of gross sales. Sales of Spy Optic 15 products to California from all channels represent .0018 % of total sales. Areatrend does nothing to expressly target the California market. [16] 17 Kasper Decl. ¶¶ 3-10, ECF No. 7-2 at 2. 18 In Graco, a trademark infringement case, this Court held that 19 The Court finds that the record contains evidence tending to show that Defendants’ products were sold to California customers. The record shows [20] that Defendants received a letter regarding infringement and a possible 21 California lawsuit. The record shows that Plaintiff is a Minnesota company and Defendants conduct their business in Texas. The record shows that [22] Plaintiff hired investigators to purchase and receive the products in California. 23 The record does not show that Defendants’ business is targeted at a Californiaspecific market or industry.… Plaintiff (a Minnesota company) sending a [24] cease and desist letter to Defendants (based in Texas) regarding infringement 25 and a possible California lawsuit cannot demonstrate express aiming in this case. [26] 27 Graco Minnesota Inc. v. PF Brands, Inc., No. 18-cv-1690-WQH-AGS, 2019 WL 1746580 , 28 at *6 (S.D. Cal. Apr. 17, 2019) (citations omitted). 1 In this case, the evidence in the record shows that Plaintiff is a California company 2 and that Defendant is an Ohio company. See Blakley Decl. ¶ 2, ECF No. 12-1 at 2; Kasper 3 Decl. ¶ 3, ECF No. 7-2 at 2. The evidence in the record shows that Defendant sold products 4 to Plaintiff in California. See Blakley Decl. ¶ 13, ECF No. 12-1 at 4; Ex. A to Ninegar 5 Decl., ECF No. 13-1 at 2. The evidence in the record shows that Plaintiff sent a cease and 6 desist letter to Defendant on December 20, 2018. See Ex. E to Blakley Decl., ECF No. 127 1 at 19-20. 8 However, the evidence in the record does not establish that Defendant’s business is 9 targeted at a California-specific market or industry. The record does not show that 10 California is the “focal point” of both the infringement claims and the alleged harm in this 11 case. Axiom Foods, 874 F.3d at 1070-71 (sending a trademark-violating email to 343 12 recipients, including 10 California residents and 55 with California companies, did not 13 expressly aim at California because “[i]t can hardly be said that ‘California [wa]s the focal 14 point both of the [newsletter] and of the harm suffered’”) (second and third alterations in 15 original) (citation omitted). In other cases, district courts have found express aiming 16 because of additional factors, none of which are present in this case. See e.g., Loomis, 2019 17 WL 5790136 , at *12 (designating an agent for service of process in California; registering 18 with the California Secretary of State; and placing products “in the hands of California19 specific individuals”); Lindora, LLC v. Isagenix Int’l, LLC, 198 F. Supp. 3d 1127 , 1139 20 (S.D. Cal. 2016) (selling more products to consumers in California than in any other state; 21 having more associates in California than in any other state; holding training workshops, 22 promotional tours, and annual conferences in California; and maintaining a website 23 “contain[ing] a page directed specifically to California consumers regarding [Defendant]’s 24 compliance with a California consumer protection statute”); Cree, Inc. v. Fastbuy, Inc., 25 No. CV 18-01802-CJC(ASx), 2018 WL 4850404 , at *4 (C.D. Cal. July 16, 2018) 26 (importing goods that Defendant knows are counterfeit into California ports; storing the 27 goods in warehouses throughout California; and distributing those goods to buyers). [28] 1 In this case, the only reference to California in Plaintiff’s cease and desist letter is 2 found in the letterhead, which lists a California address for the Blakely Law Group. 3 Defendant’s sale and shipment of two allegedly infringing products to California on 4 February 3, 2017 occurred before Plaintiff’s cease and desist letter was sent on December 5 20, 2018. The Court concludes that the cease and desist letter and the two purchases do 6 not show that the challenged conduct is connected to California. The Court concludes that 7 Plaintiff fails to make a prima facie showing that Defendant engaged in tortious conduct 8 expressly aimed at California. The Court need not determine whether specific personal 9 jurisdiction is lacking for other reasons. See Picot, 780 F.3d at 1215 n.4 (“Because Picot 10 has not established the second prong of our purposeful direction test, we need not address 11 the third prong.”) (citation omitted). 12 3. Jurisdictional Discovery 13 Plaintiff contends that Defendant’s claim that its total sales to California represent 14 only 4.7% of gross sales is misleading. Plaintiff asserts that it would need to perform 15 discovery on Defendant’s sales to California in order to establish the extent of Defendant’s 16 contacts with California. Plaintiff requests leave to conduct jurisdictional discovery. 17 Defendant contends that the Court should deny any request by Plaintiff for jurisdictional 18 discovery because Plaintiff’s allegations of jurisdiction have been denied by Defendant and 19 remain unrebutted. 20 “A court may permit discovery to aid in determining whether it has in personam 21 jurisdiction…. In granting discovery, the trial court is vested with broad discretion ….” 22 Data Disc, Inc. v. Sys. Tech. Assocs., Inc., 557 F.2d 1280 , 1285 n.1 (9th Cir. 1977) (citation 23 omitted). “[W]here pertinent facts bearing on the question of jurisdiction are in dispute, 24 discovery should be allowed.” Am. W. Airlines, Inc. v. GPA Group, Ltd., 877 F.2d 793 , 25 801 (9th Cir. 1989) (citation omitted); see also Mitan v. Feeney, 497 F. Supp. 2d 1113 , 26 1119 (C.D. Cal. 2007) (stating that discovery is warranted only if the plaintiff “make[s] a 27 ‘colorable’ showing,” which is “less than a prima facie showing,” of “‘some evidence’ 28 tending to establish personal jurisdiction over the defendant”) (citations omitted). 1 || However, “where a plaintiff's claim of personal jurisdiction appears to be both attenuated 2 based on bare allegations in the face of specific denials made by the defendants, the 3 ||Court need not permit even limited discovery.” Pebble Beach Co. v. Caddy, 453 F.3d 4 |{1151, 1160 (9th Cir. 2006) (citation omitted). A court need not grant discovery based on 5 ||“purely speculative allegations of attenuated jurisdictional contacts.” Getz v. Boeing Co., 6 F.3d 852, 860 (9th Cir. 2011). 7 In this case, the Court finds that the discovery Plaintiff seeks regarding additional 8 California and other sales information would not change the jurisdictional analysis. See 9 || Adobe Sys. Inc. v. Cardinal Camera & Video Ctr., Inc., No. 15-cv-02991-JST, 2015 WL 10 }/5834135, at *5 (N.D. Cal. Oct. 7, 2015) (stating that “a sale into the forum is not a 11 |}substantial contact where it ‘involved the forum state only because that is where the 12 || purchaser happened to reside.’ ... District courts have extended this principle to cases 13 ||involving multiple sales entering the forum simply because the purchasers happened to live 14 || in the forum’) (citing cases where California sales constituted 10% and 1.6% of total sales 15 not demonstrate purposeful direction). Plaintiff’s “claim of personal jurisdiction 16 appears to be both attenuated and in the face of specific denials” by Defendants. Pebble 17 ||Beach, 453 F.3d at 1160. Plaintiff fails to make a colorable showing of personal 18 || jurisdiction in this case. See Mitan, 497 F. Supp. 2d at 1119 . The Court declines to exercise 19 |/its discretion to permit jurisdictional discovery. 20 CONCLUSION 21 IT IS HEREBY ORDERED that the Motion to Dismiss filed by Defendan 22 || AreaTrend, LLC (ECF No. 7) is GRANTED. 23 IT IS FURTHER ORDERED that Plaintiff's request for jurisdictional discovery is 24 || DENIED. 25 The case is dismissed without prejudice. 26 || Dated: April 13, 2020 itt Z. A a 27 Hon. William Q. Hayes 28 United States District Court