Viahart, LLC v. Arkview LLC d/b/a Moo Toys and d/b/a Lexivon

CourtDistrict Court, E.D. Texas
DecidedAugust 20, 2020
Docket6:19-cv-00406
StatusUnknown

This text of Viahart, LLC v. Arkview LLC d/b/a Moo Toys and d/b/a Lexivon (Viahart, LLC v. Arkview LLC d/b/a Moo Toys and d/b/a Lexivon) is published on Counsel Stack Legal Research, covering District Court, E.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Viahart, LLC v. Arkview LLC d/b/a Moo Toys and d/b/a Lexivon, (E.D. Tex. 2020).

Opinion

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF TEXAS No. 6:19-cv-00406 Viahart, LLC, Plaintiff, V. Arkview LLC et al., Defendants. Before BARKER, District Judge ORDER This case arises from a dispute between manufacturers of certain engineering-type children’s toys. Plaintiff alleges that defendants have infringed on its non-patent intellectual prop- erty related to the “Brainflakes” interlocking-disk toy. Before the court are the following motions: e Defendant PlayLearn USA, Inc.’s motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(2) (for lack of personal jurisdiction) and 12(b)(6) (for fail- ure to state a claim upon which relief may be granted) (Doc. 11), which was briefed through the reply (Docs. 18 & 19). e Defendant Comfortscape LLC’s motion to dismiss pur- suant to Rule 12(b)(2) (Doc. 39), which was briefed through the sur-reply (Docs. 59, 65, & 69). e Defendant Jesus Diaz Maso’s motion to dismiss pursu- ant to Rule 12(b)(2) and 12(b)(6) (Doc. 40), which was briefed through the sur-reply (Docs. 60, 66, & 70). e Finally, defendant Creative Kids Far East, Inc.’s motion to dismiss pursuant to Rule 12(b)(2) and 12(b)(6) (Doc. 58), which was briefed through the sur-reply (Docs. 62, 67, & 71).

For the reasons set forth below, the court grants the motions to dismiss on Rule 12(b)(2) personal-jurisdiction grounds. Ac- cordingly, the court will not address the alternative failure-to- state-a-claim argument in those motions to dismiss. See Perva- sive Software Inc. v. Lexware GmbH & Co. KG, 688 F.3d 214, 231- 32 (5th Cir. 2012). Background Defendant PlayLearn is a New York corporation that does not maintain “any employees, office locations, or other pres- ence in Texas” and does not engage in any advertising tar- geted specifically toward Texas residents, “by geographically- focused online marketing or otherwise.” Doc. 11 at 6. It does operate its own e-commerce website and sell through Ama- zon.com Inc.’s e-commerce platform. Doc. 11-2. PlayLearn’s sales through Amazon are “fulfilled by Amazon,” meaning that Amazon stores the products in its facilities and “pick[s], pack[s], ship[s], and provide[s] customer service for [those] products.” Id. It is unknown whether Amazon stored any of PlayLearn’s products in Texas or performed any other fulfill- ment services in Texas. PlayLearn’s only sales to Texas resi- dents have been through Amazon. Id. PlayLearn argues that it cannot be automatically subject to the jurisdiction of this court simply because it operates an e-commerce site accessi- ble in Texas and made some sales to Texas residents that were fulfilled by Amazon. Doc. 11 at 5-7. Defendant Comfortscape is organized in Delaware. Doc. 65-1. Defendant Maso is a Florida resident and the president of Comfortscape. Id. Comfortscape, like PlayLearn, has no contacts with Texas other than its presence on Amazon’s plat- form and sales through Amazon’s fulfillment services. Doc. 39 at 4. Maso’s only contacts with Texas are two personal trips and a layover in an airport. Doc. 40-1. Comfortscape argues that it cannot automatically be subject to the jurisdiction of this court simply because it uses Amazon’s platform and ful- fillment services. Doc. 39 at 4-5. Maso argues that he cannot be subject to the jurisdiction of this court because of actions attributable to Comfortscape, even if those actions would sub- ject Comfortscape to the jurisdiction of the court. Doc. 40 at 6- 8. Defendant Creative Kids is a New York corporation. Doc. 58 at 7. Creative Kids sells the product in question to another entity, “Creative Kids Online LLC,” also based in New York, which sells the product to consumers and other businesses. Id. at 2-3. Creative Kids does no marketing, except through Amazon, and that marketing is not targeted to any particular state. Id. at 7. Creative Kids argues that it has no contacts with Texas that could subject it to the jurisdiction of this court. With respect to PlayLearn, Comfortscape, and Maso, plaintiff argues that their presence on Amazon’s platform and their sales to Texas residents through Amazon is sufficient to establish personal jurisdiction. Docs. 18 at 7-11; 59 at 5-10; & 60 at 5-9. Plaintiff makes the same argument as to Creative Kids but also attempts to argue, without citing authority, that Creative Kids’ relationship with Creative Kids Online LLC subjects it to jurisdiction here. Doc. 62 at 5-6, 8-12. Legal Standard Federal courts follow the law of the forum state in deter- mining the bounds of in personam jurisdiction. Daimler AG v. Bauman, 571 U.S. 117, 125 (2014). The Texas long-arm statute grants personal jurisdiction to the full extent allowed by fed- eral due-process limits and, therefore, this inquiry becomes one of federal constitutional limits. Moki Mac River Expeditions v. Drugg, 221 S.W.3d 569, 575 (Tex. 2007); Johnston v. Multidata Sys. Int’l Corp., 523 F.3d 602, 609 (5th Cir. 2008). Due-process limitations dictate that a defendant is subject to personal ju- risdiction only if it “has certain minimum contacts with [the forum state] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Daimler AG, 571 U.S. at 126 (cleaned up). This inquiry has two parts. In the first part of the inquiry, the court must determine whether the defendant has purposefully availed itself of the privilege of conducting business in the forum state and of “the benefits and protections” of the forum's laws. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475-76 (1985). If so, it is “pre- sumptively not unreasonable to require [it] to submit to the burdens of litigation in that forum as well.” Id. Specific juris- diction, as opposed to general jurisdiction, exists where “the suit arises out of or relates to” the foreign defendant’s “mini- mum contacts” with the forum. Daimler AG, 571 U.S. at 127. Thus, the focus of the analysis is on the relationship between the defendant, the forum, and the litigation. Walden v. Fiore, 571 U.S. 277, 284 (2014). And this analysis involves three prin- ciples. First, the contacts must be those of the defendant itself, rather than the unilateral act of some third party, and those contacts must be with the forum state, rather than with per- sons in the forum state. Id. at 284-86. Second, the contacts must be purposeful, rather than random or fortuitous. Id. at 286 (citing Burger King, 471 U.S. at 475). Third, the defendant must seek some benefit or advantage by its contacts with the forum. See Burger King, 471 U.S. at 473-76. In the second part of the inquiry, maintenance of the suit in the selected forum must comply with traditional notions of fair play and substantial justice. Id. at 476-78. The court need not analyze the second inquiry where the first inquiry fails. The touchstone of the personal-jurisdiction analysis is whether the defendant “should reasonably anticipate being haled into court” in the forum, given its relevant conduct. Id. at 474. But foreseeability is not the ultimate concern and is constrained by the above framework and by the principle that jurisdiction is primarily a question of authority rather than fairness. See J. McIntyre Mach., Ltd v. Nicastro, 564 U.S. 873, 881-84 (2011). Thus, jurisdiction may only rest on the defend- ant’s purposeful contacts that manifest its intention to submit to jurisdiction. Id.; Wilson v. Belin, 20 F.3d 644

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Viahart, LLC v. Arkview LLC d/b/a Moo Toys and d/b/a Lexivon, Counsel Stack Legal Research, https://law.counselstack.com/opinion/viahart-llc-v-arkview-llc-dba-moo-toys-and-dba-lexivon-txed-2020.