In Xilinx, Inc. v. Papst Licensing GmbH & Co. KG, Appeal No. 2015-1919, the Federal Circuit held that to exercise specific personal jurisdiction, a court must find (1) sufficient minimum contacts between the party and the forum state, and (2) it is “reasonable and fair” to do so. In particular, the Federal Circuit found it was reasonable and fair to exercise jurisdiction over a party that sent notice letters into the forum state, visited the forum state to discuss its infringement contentions, and had previously litigated in the forum state.
Papst, a German non-practicing entity, sent several notice letters to Xilinx alleging patent infringement. After Xilinx failed to respond, Papst sent representatives to Xilinx’s headquarters in California to discuss its infringement contentions. No agreement was reached, and Xilinx filed a declaratory judgment action in the Northern District of California seeking a declaration of non-infringement and invalidity. The District Court dismissed the suit for lack of personal jurisdiction. Xilinx appealed.
Papst did not dispute that its actions, including sending notice letter to Xilinx and visiting Xilinx in California satisfied the minimum contacts requirement. Instead, Papst argued that exercise of personal jurisdiction was not “reasonable and fair.” It is presumptively reasonable to exercise jurisdiction where minimum contacts have been established. To defeat jurisdiction, a party must show a “compelling case” under Burger King, that jurisdiction is unreasonable. The five Burger King factors include: (1) the burden on the defendant, (2) the forum state’s interest in adjudicating the dispute, (3) the plaintiff’s interest in obtaining convenient and effective relief, (4) the interstate judicial system’s interest in obtaining the most efficient resolution of controversies, and (5) the shared interest of the several states in furthering fundamental substantive social policies.
Papst focused its argument on the first factor, relying on Redwing’s holding that although warning letters satisfy the requirements of minimum contacts, such letters cannot satisfy the fairness prong. Redwing explained that to require a defendant to answer in a distant foreign forum when its only contacts were efforts to give proper notice of its patent rights placed an undue burden on the defendant. The Court rejected Papst’s argument, finding that the burden on the defendant was minimal. Papst is a non-practicing entity residing outside of the United States, and has done more than merely send a notice letter into California, including traveling to California to discuss infringement contentions and a licensing offer. Papst even chose to file seven patent infringement lawsuits in California in the past.
Accordingly, the Federal Circuit held that exercising specific personal jurisdiction over Papst in California was proper.