Deliberately and purposefully shipping allegedly infringing products to retailers in the forum constitutes purposeful availment sufficient to support specific personal jurisdiction
Polar Electro Oy v. Suunto Oy, No. 2015-1930 (Fed. Cir. July 20, 2016)
The patentee appealed the district court’s decision granting the alleged infringer’s motion to dismiss for lack of personal jurisdiction. The alleged infringer, a foreign company, ships its products to retailers identified by its United States’ sister company for distribution in the United States. The patentee asserted that some of those products were shipped by the alleged infringer to retailers in the forum. The alleged infringer argued that its sister company takes title to those products abroad, and pays for and directs the shipments to the United States.
The district court held that the alleged infringer did not have sufficient contacts with the forum to support specific personal jurisdiction. Relying upon the Supreme Court’s 2011 decision in J. McIntyre Machinery, Ltd. v. Nicastro, the district court did not find “something more” in the alleged infringer’s activities directed toward the forum beyond placing its products into the stream-of-commerce.
Noting that the stream-of-commerce theory remains unsettled since the Supreme Court’s 1987 Asahidecision, the Federal Circuit held that the alleged infringer had sufficient contacts with the forum, under any articulation of the stream-of-commerce test. Further, it held that the purposeful shipment of at least 94 accused products to forum retailers for sale in the forum amounted to purposeful availment. This purposeful conduct included physically fulfilling the orders, packaging the products, and preparing the shipments. The Federal Circuit vacated the district court’s decision and remanded for determination of whether the exercise of personal jurisdiction would be reasonable and fair.