No. C 04-00380 SI.
June 7, 2004
ORDER TRANSFERRING ACTION TO MIDDLE DISTRICT OF NORTH CAROLINA
On June 4, 2004, this Court heard argument on defendant's Motion to Dismiss for Lack of Personal Jurisdiction, pursuant to Federal Rules of Civil Procedure Rule 12(b)(2), and/or for Lack of Subject Matter Jurisdiction, pursuant to 17 U.S.C. § 411(a). Having carefully considered the argument of counsel and the papers submitted, this Court finds that it lacks personal jurisdiction over defendant Litera Corporation and accordingly TRANSFERS this action to the United States District Court for the Middle District of North Carolina, where it might properly have been brought pursuant to 28 U.S.C. § 140(a).
Plaintiff Workshare Technology Inc. complains that defendant Litera Corporation has infringed plaintiff's rights by copying software programs of which plaintiff is the exclusive licensee in the United States, and by reproducing, among other things, all or portions of the graphical user interface of these programs. Compl. at ¶ 23. Defendant moves to dismiss this action pursuant to Rule 12(b)(2) for lack of personal jurisdiction, contending that Litera lacks minimum contacts with the State of California such that exercise of jurisdiction over it would not be fair or reasonable. In the alternative, defendant argues that the Court cannot exercise subject matter jurisdiction because plaintiff lacks a certificate of registration of copyright as defendant argues is required under 17 U.S.C. § 411(a). The Court need not go to the latter issue of subject matter jurisdiction, however, because plaintiff has not met its burden of establishing that Litera has sufficient contacts in California to allow the Court to properly exercise personal jurisdiction over it.
Defendant Litera is incorporated in the State of New Jersey and has its principal and only place of business in the State of North Carolina. Decl. of Deepak Massand in Supp. of Def.'s Mot. to Dismiss ("Massand Decl.") at ¶ 3. All of Litera's employees and independent contractors work out of the North Carolina office. Id. None of the employees or independent contractors of Litera have ever attended business conferences or similar functions in California related to Litera. Id. Furthermore, Litera does not maintain any California offices; it does not have any employees within California; and it has no corporate activity in this state. Id. at ¶ 4. Litera does not actively market its products in the state and it does not direct any advertising to California markets. Id. at ¶ 6. Litera has no sales in California and does not derive any of its revenues from residents of California. Id. at ¶ 7. The Court has viewed the Litera's website and agrees with defendant that it is should be characterized as passive, since it provides little more than information about Litera's products. Any opportunity to purchase defendant's product is a distant second to the site's primary purpose of educating the public about its product. Further, there is no evidence that defendant has marketed its product in California through its website. In fact, "there have only been three to four individuals that have registered with Litera's website from the State of California to obtain a demonstration copy of [plaintiff's product]." Id. at ¶ 10. Defendant believes that three of the registered individuals are principals of the plaintiff or are related to plaintiff. Id. at 10. All of the defendant's witnesses, including its founder and president Deepak Massand, and all of the documents concerning Litera's accused software, are located in North Carolina. Id. at 14.
It would be unreasonable for the Court to require Litera to defend itself in this action in this forum, and plaintiff's interest in bringing suit in California does not outweigh the burden that would be caused defendant if this action stayed in this forum. The Court therefore concludes that it lacks personal jurisdiction over these claims against this defendant.
At oral argument, the Court inquired of counsel for plaintiff whether it would rather this action be dismissed under Rule 12(b)(2) or transferred to North Carolina pursuant to 28 U.S.C. § 1406(a); plaintiff elected the latter. Accordingly, this action is hereby TRANSFERRED to the Middle District of North Carolina, where it might have been brought.
The remaining question of subject matter jurisdiction is best resolved by the trial court in North Carolina.
Taking all uncontroverted allegations in plaintiff's complaint as true, and resolving all factual conflicts in plaintiff's favor, plaintiff has not established that this Court may properly exercise personal jurisdiction over Litera. For the foregoing reasons and for good cause shown, the Court hereby TRANSFERS this action to the Middle District of North Carolina. [docket # 21].