Delorme Publishing Co. v. Briartek, Inc.

• Court: Superior Court of Maine
• Decided: July 28, 2014
• Docket: CUMcv-13-368
• Status: Unpublished

Opinion

f ~J Y E Rf D AUG 2 2 Z014

STATE OF MAINE SUPERIOR COURT CUMBERLAND, ss. CIVIL ACTION DocketNo. CV-13-368

RAe- WH -Lf/-~~-l4- DELORME PUBLISHING COMPANY, INC., and DELORME INREACH, LLC,

Plaintiffs ORDER ON MOTION TO DISMISS v.

MP..INE BRIARTEK, INC., and LEWIS SIP..IE Or C'erl<.·s office CRENSHAW, III, cumberland ss. '

J\JL 'L S 20\~ Defendants RE.Cf.\\JED Before the court is the Defendants' Motion to Dismiss the Plaintiffs' Complaint for lack

of personal jurisdiction pursuant to Maine Rule of Civil Procedure 12(b)(2). This court held a

non-testimonial hearing on the Defendants' Motion. The Plaintiffs have opposed the Defendants'

Motion, and have asked that the Motion either be denied or that the Plaintiffs be permitted to

conduct jurisdictional discovery prior to the resolution of the Motion.

The Plaintiffs' Complaint claims that the Defendants have misappropriated one or more

ofthe Plaintiffs' trade secrets in violation of(l) the Maine Uniform Trade Secrets Act, 10

M.R.S.A. § 1541, et seq., and (2) the Virginia Uniform Trade Secrets Act, V.C.A. § 59.1-336.

Factual and Procedural Background:

DeLorme Publishing Company, Inc. and DeLorme InReach, LLC (collectively

"DeLorme") are both Maine companies with their principal places of business in Yarmouth,

Maine. Defendant BriarTek, Inc. ("BriarTek") is a Virginia company with its principal place of

business in Alexandria, Virginia. Defendant Lewis Crenshaw, III was BriarTek's director of

engineering during the periods pertinent to the Plaintiffs' Complaint, and he is a resident of

Norfolk, Virginia.

DeLorme and BriarTek are competitors in the same industry. Both DeLorme and

BriarTek sell satellite emergency notification devises, and both companies use Iridium Satellite,

Inc.'s ("Iridium") satellite network. 1 DeLorme is alleging that Crenshaw and BriarTek obtained

trade secrets concerning DeLorme from Iridium (a Virginia corporation) through improper

means that resulted in a breach of duty on the part oflridium. 2 More specifically, DeLorme has

alleged that BriarTek disclosed in a filing in federal court that Crenshaw wrote to Iridium

seeking informing regarding sales ofDeLorme's inReach device. 3 The trade secrets at issue

appear to concern the Iridium satellite modem, sales information, and the business relationship

between DeLorme and Iridium.

DeLorme and BriarTek and BriarTek, IP Inc. (a non-party to this action) have been

involved in litigation with one another in federal court. In its declaratory judgment action before

the U.S. District Court for the Eastern District of Virginia, the Plaintiff originally attempted to

1 From reading BriarTek's memorandum it appears that the Iridium entities involved may have been confused. According to BriarTek, it has value added reseller agreements with Iridium Satellite, LLC, not Iridium Satellite, Inc. BriarTek also contends that the Iridium employee allegedly involved in the activities pertinent to this case was employed by Iridium Communications, Inc. For purposes of this Motion, however, the exact Iridium entities involved are irrelevant. 2 The court notes from the filings that there is a dispute between the two parties regarding whether the Defendants intentionally sought information regarding DeLorme from Iridium. There is no need for an evidentiary hearing on this factual dispute, however, as even assuming, for purposes of this Motion, that the Defendants intentionally sought the information regarding DeLorme from Iridium, the court still lacks personal jurisdiction over the Defendants. The court would lack personal jurisdiction over this dispute under either scenario. 3 The Defendants have provided this filing and it does not state what the Complaint purports, instead it states that "Mr. Crenshaw asked an Iridium employee for Iridium's projection on the size of the market for devices similar to the Cerberus." (DeLorme Ex. 1 Opp. 3.)

2 amend its Complaint against BriarTek and BriarTek IP, Inc. to include a claim that BriarTek and

Crenshaw violated Virginia's Uniform Trade Secrets Act, but the court denied such amendment.

Standard:

Maine law allows the court "to assert jurisdiction over nonresident defendants to the

fullest extent permitted by the due process clause of the United States Constitution, 14th

amendment." 14 M.R.S. § 704-A. The Statute also provides that:

Any person, whether or not a citizen or resident of this State, who in person or through an agent does any of the acts hereinafter enumerated in this section, thereby submits such person, and, if an individual, his personal representative, to the jurisdiction of the courts of this State as to any cause of action arising from the doing of any of such acts: ...

Doing or causing a tortious act to be done, or causing the consequences of a tortious act to occur within this State;

14 M.R.S.A. § 704-A(2)(B).

In order to exercise personal jurisdiction over a nonresident defendant the Law Court has

held that:

due process is satisfied when three conditions are met: (1) Maine has a legitimate interest in the subject matter of the litigation; (2) the defendant, by his or her conduct, reasonably could have anticipated litigation in Maine; and (3) the exercise of jurisdiction by Maine's courts comports with traditional notions of fair play and substantial justice.

Commerce Bank & Trust Co. v. Dworman, 2004 ME 142, ~ 14, 861 A.2d 662 (citations omitted).

The burden is on the plaintiff to demonstrate that the first two conditions are met, and

then the burden shifts to the defendant to demonstrate that the exercise of jurisdiction would fail

to comport with fair play and substantial justice. !d. The Plaintiff must meet its burden using

"specific facts in the record," but the court will interpret the record in the light rrrost favorable to

the plaintiff. Bicliford v. Onslow Mem 'I Hosp. Found., Inc., 2004 ME 111, ~ 10, 855 A.2d 1150,

115 5. When, as in this instance, the court decides the jurisdiction question simply on the

3 affidavits and pleading of the parties, the plaintiff only needs to make a prima facie showing of

jurisdiction. Dorfv. Complastik Corp., 1999 ME 133, ~ 14, 735 A.2d 984.

To determine whether personal jurisdiction may be exercised, the court will apply the

minimum contacts requirement as enunciated in International Shoe Co. v. Washington, 326 U.S.

310 (1945). See Dworman, 2004 ME 142, ~ 14, 861 A.2d 662. The Supreme Court has held that

"For a State to exercise jurisdiction consistent with due process, the defendant's suit related

conduct must create a substantial connection with the forum state." Walden v. Fiore, 134 S. Ct.

1115, 1121 (2014). The Court specified that the relationship between the Defendant and the

forum State "must arise out of contacts that the 'defendant himself' creates with the forum State .

. . ,"and the court's analysis must examine "the defendant's contacts with the forum State itself,

not the defendant's contacts with persons who reside there." Id. at 1122 (citing Burger King

Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985))(emphasis in the

original).

Discussion:

As an initial matter, the court notes that in support of their Motion the Defendants have

submitted an affidavit from BriarTek Inc. and BriarTek IP, Inc.'s co-founder Joseph Landa.

Plaintiffs failed to submit any affidavits in opposition to the Motion. The Plaintiffs have relied

solely on the allegations in their Complaint. SeeDorf 1999 ME 133, ~ 13, 735 A.2d 984

(quotations and citations omitted) ("The plaintiffs showing in opposition to the motion must be

made on specific facts set forth in the record[.] This means that [a] plaintiff must go beyond the

pleadings and make affirmative proof. This showing may be made by affidavit or otherwise.")

Despite the Plaintiffs failure to go beyond the pleadings, the court undertook the analysis below

considering the filings from both parties.

4 The Defendants contend that the Complaint is facially defective, because it contains no

basis for personal jurisdiction over the non-resident Defendants. The Defendants have argued

that none of the three prongs of the test described in Dworman are met. The court agrees as to

two ofthe prongs and thereby finds that the court lacksjurisdiction. 4 The Defendants also argue

that the Plaintiffs' assertions are meritless, and that the U.S. District Court for the Eastern

District of Virginia warned DeLorme that if it tried to re-file the claim, Iridium appeared to be a

necessary party. The court notes that as it is dismissing this case for lack of personal jurisdiction,

it is unnecessary to reach BriarTek's last contention.

Does Maine have a legitimate interest?

In determining whether or not Maine has a legitimate interest in the subject matter of the

litigation, the Law Court has qualified that "[a]lthough Maine has an interest in providing its

citizens with a means of redress against nonresidents, an interest beyond mere citizenry is

necessary, such as the protection of its industries, the safety of its workers, or the location of

witnesses and creditors within its border." Murphy v. Keenan 667 A.2d 591, 594 (Me. 1995)

(citations omitted) (holding that Maine did not have a legitimate interest in the subject matter of

the litigation when Maine resident brought complaint ~or damages because he purchased a boat

with a warranty from a New Hampshire dealership, which was encumbered by liens the Maine

resident was unaware of, since the only state interest was providing a forum for redress.)

The Defendants argue that the State of MainP- does not have a legitimate interest in this

action, as there is no industry to protect and the Defendants have not reached into Maine or

entered into relationships or obligations with Maine citizens. The Defendants' analysis, however,

4 The court does not find that additional jurisdictional discovery on the part of the Plaintiffs would be likely to change the outcome of this Motion.

5 overlooks Maine's interest in protecting the trade secrets of its businesses. Maine has a

legitimate interest in protecting corporations within its borders. See Murphy v. Keenan, 667 A.2d

591, 594 (Me. 1995). Thereby, the Plaintiffs have demonstrated that they have met this

requirement for jurisdiction.

Anticipation of litigation in Maine/purposeful availment

In order to find that a party should anticipate the possibility of litigation in Maine the

court has found that a party "must purposefully avail oneself of the privilege of conducting

activities within the jurisdiction and benefit from the protection of its laws." Dworman, 2004 ME

142, ~ 16, 861 A.2d 662, 667 (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462,474-75

(1985)). )). "Due process requires that a defendant be haled into court in a forum State based on

his own affiliation with the State, not based on the 'random, fortuitous, or attenuated' contacts he

makes by interacting with other persons affiliated with the State." Walden v. Fiore, 134 S. Ct.

1115, 1123 (2014) (quoting Burger King, 471 U.S. at 475(internal quotation marks omitted)).

"A defendant's activities are sufficient to establish minimum contacts when (1) the

activities of the defendant have been directed at the forum's residents; (2) the defendant

deliberately engages in significant activities in the forum; or (3) the defendant creates continuing

obligations between itself and residents ofthe forum." Cavers v. Houston McLane Co., Inc.,

2008 ME 164, ~ 24, 958 A.2d 905.

The effect in Maine of an out-of-state act is one factor to be analyzed as a part of the

minimum contacts test. Bickford, 2004 ME-11, ~ 12, 855 A.2d 1150 (quoting Murphy, 667 A.2d

at 595). '" [T]he commission outside the forum state of an act that has consequences in the forum

state is by itself an insufficient contact where all the events necessary to give rise to a tort claim

occurred outside the forum state."' !d.

6 DeLorme has not shown that the Defendants' actions were directed at Maine residents,

that DeLorme purposefully engages in significant activities in Maine, or that the Defendants

have purposefully created continuing obligations with Maine residents. All of the relevant

allegedly tortious events occurred in Virginia. In this instance, the only relation to Maine is

DeLorme's presence in Maine, and the possible effect of the communications between the

Defendants and Iridium upon DeLorme. The Defendants could not have anticipated litigation in

Maine. All of the Defendants' relevant interactions were with Iridium, another Virginia

corporation. DeLorme has not shown purposeful availment on the part of the Defendants, nor has

DeLorme satisfied the minimum contacts test.

Traditional notions offair play and substantial justice

The last factor to consider is whether Maine's exercise of jurisdiction "comports with

traditional notions affair play and substantial justice." Dworman, 2004 ME 142, ~ 14, 861 A.2d

662. "This analysis requires consideration of' a variety of factors including the nature and

purpose of defendant's contacts with the forum state, the connection between the contacts and the

cause of action, the number of contacts, the interest of the forum state ... , and the convenience

and fairness to both parties."' Cavers, 2008 ME 164, ~ 36,958 A.2d 905 (quoting Labbe v.

Nissen Corp., 404 A.2d 564, 570 (Me.1979). Considering that BriarTek and Iridium are both

Virginia companies, Crenshaw is a Virginia resident, and that this case relates to actions that

were taken in Virginia, it does not appear fair to have the Defendants litigate this case in Maine.

Aside from any potential effects of the communication between the Defendants and Iridium upon

DeLorme, DeLorme has not mentioned any contacts between the Defendants and Maine.

Exercising jurisdiction over this case in Maine would not be in keeping with fair play and

substantial justice.

7 Accordingly, this court orders that the Defendants' Motion is GRANTED. Plaintiffs'

case is dismissed.

The Clerk is directed to incorporate this Order into the docket by reference pursuant to

Maine Rule of Civil Procedure 79(a).

Dated:

8 prod/1.8.1b1/prd11 MAINE JUDICIAL INFORMATION SYSTEM 07/29/2014 gmerritt CUMBERLAND COUNTY SUPERIOR COURT mjxxi013 PAGE A - ATTORNEY BY CASE VIEW ~~LORME PUBLISHING COMPANY INC ET AL VS BRIARTEK INC ET AL .rN:AOCSsr -2013-0075692 CASE #:PORSC-CV-2013-00368

01 0000002466 ~B~RANN~~~P~E~T~E~R~----------------------------------------- 184 MAIN STREET PO BOX 3070 LEWISTON ME 04243-3070 F DELORME PUBLISHING COMPANY INC ~P=L________~R~T~N~D~~0~8~/=2=2~/~2~0~13 F DELORME INREACH LLC ~P=L________~R~T~N~D~~0~8~/=2=2~/~2~0~13

02 0000008551 O'KEEFE, MARGARET MINISTER MERRILLS WHARF 254 COMMERCIAL ST PORTLAND ME 04101 F BRIARTEK INC .=.D.::.E:_F_ _ ____;R:.;;T~N:.:.::D;,___.::.0~9!....;/1:::..:6~/_:2:...::0..:1~3 F LEWIS CRENSHAW, III DEF RTND 09/16/2013