Troma Entertainment, Inc. v. Centennial Pictures Inc., et al., Case No. 12-1883 (2d Cir. Sept. 6, 2013) [click for opinion]
Troma is a film production and distribution company based in New York. It brought an infringement action in the Eastern District of New York claiming Centennial Pictures secretly sold distribution rights to its movies to a distributor in Germany. The district court dismissed the case for lack of personal jurisdiction, and the Second Circuit affirmed.
New York’s long-arm statute confers personal jurisdiction over defendants whose out-of-state conduct causes injury to persons or property within the state. New York Civil Practice Law and Rule § 302(a)(3). Plaintiff argued that Defendants’ infringement caused Plaintiff to suffer economic loss, namely lost commercial profits, in New York since that is where Plaintiff is based. The Second Circuit rejected this argument. The court noted that a plaintiff’s suffering economic loss in New York is alone insufficient to justify exercising personal jurisdiction over a defendant. Jurisdiction exists where “the plaintiff’s business is either lost or threatened.” In this case, that would have been either in California, where the defendants planned their infringement scheme, or Germany, where they carried out the plan, but not New York.