Norkol/Fibercore, Inc. v. Gubb

279 F. Supp. 2d 993, 2003 U.S. Dist. LEXIS 15756, 2003 WL 22075390
CourtDistrict Court, E.D. Wisconsin
DecidedAugust 25, 2003
Docket01-C-1267
StatusPublished
Cited by9 cases

This text of 279 F. Supp. 2d 993 (Norkol/Fibercore, Inc. v. Gubb) is published on Counsel Stack Legal Research, covering District Court, E.D. Wisconsin primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Norkol/Fibercore, Inc. v. Gubb, 279 F. Supp. 2d 993, 2003 U.S. Dist. LEXIS 15756, 2003 WL 22075390 (E.D. Wis. 2003).

Opinion

DECISION AND ORDER

ADELMAN, District Judge.

Plaintiffs (“Fibercore”) brought this patent infringement action against defendants Quad/Graphics, Inc. (“Quad/Graphics”), L & P Converters Corp. (“L & P”), Sterling Technology, Inc. (“Sterling”), and Martin Gubb (“Gubb”). Quad/Graphics has since been dismissed as a defendant. Plaintiffs assert two patent infringement claims. Plaintiffs also assert, against defendants Sterling and Gubb, a claim for conspiracy to induce infringement and claims of tor-tious interference with prospective business advantage and tortious interference *995 with lawful business. This court has jurisdiction over the claims relating to patents under 28 U.S.C. § 1338(a) and supplemental jurisdiction over the state law claims under 28 U.S.C. § 1367(a). Before me now are Gubb’s motions to dismiss plaintiffs second amended complaint for lack of personal jurisdiction and/or for improper venue, and Sterling and Gubb’s motion to dismiss the conspiracy claim for failure to state a claim.

I. FACTS

Fibercore is in the business of cutting off the ends of paper rolls and holds several patents on devices that perform this function. Gubb is a California resident and the owner and president of both L & P and Sterling. Sterling is a division of L & P. Sterling recently sold a machine that cuts paper rolls to Quad/Graphics. This machine is the alleged infringing product. The sale of the machine was negotiated on behalf of Sterling by Gubb. In the course of the transaction, Gubb had a number of contacts with Wisconsin. Quad/Graphics is a Wisconsin company, and Gubb negotiated the sale with Quad/Graphics employees who were located in Wisconsin. Gubb’s contacts with Wisconsin were both telephonic and written.

II. PERSONAL JURISDICTION OVER GUBB

Pursuant to Fed.R.Civ.P. 12(b)(2), Gubb moves to dismiss plaintiffs’ claims against him based on the absence of personal jurisdiction. Whether a court has personal jurisdiction over a defendant in a patent case is determined according to the law of the federal circuit rather than of the regional circuit in which the case arose. Wayne Pigment Corp., v. Halox, 220 F.Supp.2d 931, 933 (E.D.Wis.2002). Plaintiffs have the burden of proving personal jurisdiction and, for purposes of determining the issue, I take all of their factual allegations as true unless they are directly controverted. Id. I may consider evidence so long as I resolve all factual disputes in plaintiffs’ favor. Id.

In determining whether this court has personal jurisdiction over a defendant, I look first to Fed.R.Civ.P. 4(k). Id. Rule 4(k) provides that even when the claim being asserted is a federal one, a federal court applies the relevant state statute to determine personal jurisdiction. Id. The question of whether I have personal jurisdiction over an out-of-state defendant involves two inquiries: (1) whether the forum state’s long-arm statute, here, Wis. Stat. § 801.05, permits the exercise of personal jurisdiction; and (2) whether the assertion of personal jurisdiction would violate due process. Id. In applying the state long-arm statute, I defer to the Wisconsin court’s interpretation of the statute and I liberally construe it in favor of exercising jurisdiction. Id. Wis. Stat. § 801.05 provides jurisdiction to the full extent provided by due process. Allen-Bradley Co., Inc. v. Datalink Technologies, Inc., 55 F.Supp.2d 958, 959 (E.D.Wis.1999).

Under § 801.05, Wisconsin can exercise two types of personal jurisdiction over a nonresident defendant, general and specific. General jurisdiction is proper when a defendant has “continuous and systematic business contacts” with a state, and it allows a defendant to be sued in that state regardless of the subject matter of the lawsuit. Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 416, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984). On the other hand, a state may exercise specific jurisdiction when the defendant has a lesser degree of contact with the state and the litigation arises out of or is related to those contacts. Id. at 414 n. 8, 104 S.Ct. 1868.

In the present case, in the course of negotiating the sale of the Sterling machine to Quad/Graphics, Gubb had both *996 telephonic and written contacts with Wisconsin, and the quantity of the contacts was more than minimal. Gubb does not dispute that such contacts would be sufficient to establish personal jurisdiction over him under the Wisconsin long-arm statute if, when the contacts occurred, he had been acting as an individual. However, he argues that he made the contacts solely in his capacity as an agent of Sterling and that, therefore, the court may not exercise jurisdiction over him as an individual. 1

Gubb argues that he may not be haled into Wisconsin courts because he is protected by the “fiduciary shield doctrine.” The doctrine denies personal jurisdiction over an individual whose presence and activity in the state in which the suit is brought were solely on behalf of his employer or other principal. Rice v. Nova Biomedical Corp., 38 F.3d 909, 912 (7th Cir.1994). Gubb’s argument thus raises the question of whether Wisconsin recognizes the fiduciary shield doctrine.

The Wisconsin Supreme Court has not spoken on the issue. Therefore, in addressing Gubb’s argument, I must predict how that court would decide the question today. Rodman Indus., Inc. v. G & S Mill, Inc., 145 F.3d 940, 942-43 (7th Cir. 1998). In making this prediction, I may seek guidance from lower Wisconsin courts or courts of other jurisdictions. See King v. Damiron Corp., 113 F.3d 93, 95 (7th Cir.1997). However, I must be circumspect in expanding the boundaries of established state jurisprudence. Id. at 97.

It is generally believed that the fiduciary shield doctrine originated in Rene Boas & Assocs. v. Vernier, 22 A.D.2d 561, 257 N.Y.S.2d 487 (N.Y.App.Div.1965). Intermatic, Inc. v. Taymac Corp., 815 F.Supp. 290, 294 (S.D.Ind.1993). In

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279 F. Supp. 2d 993, 2003 U.S. Dist. LEXIS 15756, 2003 WL 22075390, Counsel Stack Legal Research, https://law.counselstack.com/opinion/norkolfibercore-inc-v-gubb-wied-2003.