Patent Rights Protection Group LLC v. Video Gaming Technologies Inc. et al., No. 2009-1391 (Fed. Cir. May 10, 2010).
The patents at issue in this case relate to various types of casino-style gaming machines. The district court dismissed the case for lack of jurisdiction and improper venue, ruling that exercising personal jurisdiction over the accused infringers would be unreasonable under Ninth Circuit precedent. The district court found that the relevant factors either weighed in favor of a finding of unreasonableness or were neutral. The district court also denied the patentee’s request for jurisdiction discovery. On appeal, the Federal Circuit vacated the decision and remanded.
For a federal district court to exercise personal jurisdiction over a non-consenting out of state defendant, two requirements must be met: the defendant must be amenable to service of process, and exercising jurisdiction over the defendant must comport with due process. The Federal Circuit stated that “[t]he constitutional touchstone of the due process inquiry remains whether the defendant purposefully established minimum contacts in the forum State.”
The accused infringers argued that they lacked the “minimum contacts” to support a case in the state of Nevada. However, the accused infringers’ admitted presence at numerous trade shows in Nevada. The Federal Circuit held that “[m]odern transportation and communications have made it much less burdensome for a party sued to defend itself outside its home state,” and in view of the accused infringers admitted presence at numerous trade shows in the forum, “neither company faces a particularly onerous burden in defending itself” in the forum. Furthermore, the Federal Circuit stated that neither accused infringer “has presented a compelling case that the presence of some other consideration would render jurisdiction unreasonable.”
The Federal Circuit also stated that “discovery should ordinarily be granted where pertinent facts bearing on the question of jurisdiction are controverted or where a more satisfactory showing of the facts is necessary.” Because a question as to the motives of the accused infringers’ exhibition of its products at trade shows in Nevada was in doubt, the Federal Circuit believed that “additional discovery may unearth facts sufficient to support the exercise of personal jurisdiction over one or both of the [accused infringers].”
A copy of the opinion can be found here.