Last week, the U.S. Court of Appeals for the Federal Circuit issued an opinion in Trimble Inc. v. PerDiemCo, LLC, No. 19-2164 (May 12, 2021), reversing the district court’s dismissal for lack of personal jurisdiction.
PerDiemCo sent Innovative Software Engineering, LLC (“ISE”) a letter asserting ISE’s products and services were covered by several of PerDiemCo’s patents and attaching an unfiled complaint. ISE, a subsidiary of Trimble, forwarded the letter to Trimble. Thereafter, the parties engaged in negotiations, during which time PerDiemCo also asserted Trimble’s products were covered by its patents. During the negotiations, PerDiemCo called, emailed, or wrote Trimble twenty-two times. Trimble and ISE ultimately filed an action for declaratory judgment of noninfringement in the Northern District of California. PerDiemCo moved to dismiss for lack of personal jurisdiction. The district court granted the motion, concluding that it lacked specific personal jurisdiction over PerDiemCo based on the Federal Circuit’s holding in Red Wing Shoe Co. v. Hockerson-Halberstadt, Inc. that “[a] patentee should not subject itself to personal jurisdiction in a forum solely by informing a party who happens to be located there of suspected infringement.” Trimble appealed.
The Federal Circuit reversed the district court’s decision. First, the Court explained that subsequent developments had clarified the scope of its holding in Red Wing. The Court noted that the Supreme Court (1) has since clarified that the analysis of personal jurisdiction does not rest on special patent policies and “is governed by the same . . . procedural rules as other areas of civil litigation”; (2) has held that communications sent into a state may create specific personal jurisdiction; and (3) has established that a broad set contacts with a forum are relevant when assessing minimum contacts. Accordingly, the Court held that, though Red Wing was correctly decided on its facts, there is “no general rule that demand letters can never create specific personal jurisdiction.”
Next, the Court analyzed PerDiemCo’s contacts with California and found they were much more extensive than those present in Red Wing. PerDiemCo had “amplified its threats of infringement” and even “went so far as to identify the counsel it retained to sue Trimble and ISE and the venue in which it planned to file suit.” For those reasons, the Court held that PerDiemCo was subject to personal jurisdiction in the Northern District of California and the case should not have been dismissed.