Yangtze Memory Technologies, Inc. v. Strand Consult

• Court: District Court, N.D. California
• Decided: May 20, 2025
• Docket: 5:24-cv-03454
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 YANGTZE MEMORY TECHNOLOGIES, Case No. 24-cv-03454-NW INC., et al., 8 Plaintiffs, ORDER GRANTING DEFENDANTS’ 9 MOTION TO DISMISS v. 10 Re: ECF No. 65 STRAND CONSULT, et al., 11 Defendants.

12 13 On June 7, 2024, Plaintiffs Yangtze Memory Technologies Company, Ltd., (“YMTC”) and 14 Yangtze Memory Technologies, Inc. (“YMT – USA”) (collectively, “Plaintiffs”) filed a complaint 15 (“Original Complaint”) alleging claims for trade libel and violations of Cal. Bus. Prof. Code 16 § 17200 et seq. against Defendants Strand Consult and Roslyn Layton. Compl., ECF No. 1. On 17 November 17, 2024, Plaintiffs filed an amended complaint, dropping their state law claims, and 18 instead bringing claims under the Latham Act, 15 U.S.C. § 1125(a), and adding Defendant DCI 19 Group AZ, L.L.C. (“DCI”) (collectively, “Defendants”). Amend. Compl., ECF No. 50 (“FAC”). 20 Defendants moved to dismiss Plaintiffs’ amended complaint pursuant to Federal Rules of 21 Civil Procedure 12(b)(1), (2) and (6), as well as 9(b). Mot. to Dismiss, ECF No. 65 (“Mot.”). 22 Plaintiffs opposed, and Defendants filed a reply. Opp’n, ECF No. 66 (“Opp’n”); Reply, ECF No. 23 67 (“Reply”). 24 The Court found this matter suitable for resolution without oral argument and vacated the 25 hearing set for May 21, 2025. Civil L.R. 7-1(b); ECF No. 80. Defendants’ motion to dismiss for 26 lack of personal jurisdiction is GRANTED with leave to amend in part. 27 I. BACKGROUND 1 memories.” FAC ¶ 5. Plaintiff YMTC is headquartered in Wuhan, China, but conducts business 2 globally. Id. ¶ 20. Plaintiff YMTC – USA is a wholly owned subsidiary of YMTC and is a 3 California corporation with its principal place of business in Santa Clara, California. Id. ¶ 21. 4 Defendant Strand Consult maintains its principal place of business in Copenhagen, 5 Denmark, and does business as China Tech Threat, a website. Id. ¶ 22. Defendant Roslyn Layton 6 is Executive Vice President of Strand Consult and a “co-founder” of China Tech Threat. Id. ¶ 23. 7 The parties contest Layton’s domicile; Defendants argue she resides and is domiciled in Denmark, 8 while Plaintiffs allege she is domiciled in Florida. Mot. at 5; FAC ¶ 23. Defendant DCI is an 9 Arizona limited liability company with its principal place of business in Washington, D.C. FAC 10 ¶ 24. 11 Plaintiffs allege that, since as early as September 2020, Micron, “another major player in 12 the 3D NAND space” and not a party to this action, has “resorted to a sham marketing scheme to 13 undermine YMTC’s achievements by spreading lies about YMTC and its products.” Id. ¶¶ 7, 11. 14 According to Plaintiffs, “Micron funded a website called ‘China Tech Threat’ or ‘CTT,’ run by 15 Defendants Roslyn Layton, Strand Consult, and DCI” that “is engaged in ‘astroturfing,’ the 16 practice of cleverly disguising the corporate messaging of businesses (such as Micron), as 17 grassroots advocacy.” Id. ¶¶ 7-8. Plaintiffs allege that “[t]he falsehoods Defendants have spread 18 through China Tech Threat have harmed YMTC’s reputation and business relationships,” and 19 “have also hurt U.S. consumers.” Id. ¶ 18. 20 On December 17, 2024, Defendants moved to dismiss Plaintiffs’ amended complaint 21 pursuant to Federal Rules of Civil Procedure 12(b)(1), (2) and (6), as well as 9(b). Mot. at 1. 22 Defendants argue that (1) the Court lacks subject matter jurisdiction over this action, (2) the 23 Plaintiffs have not sufficiently alleged Article III standing and statutory standing under the Latham 24 Act, and (3) that the Court lacks personal jurisdiction over DCI. Id. In the alternative, Defendants 25 argue that Plaintiffs do not plausibly allege facts to support their Lanham Act claims. Id. 26 The Court finds that Plaintiffs have not met their burden to establish personal jurisdiction, 27 and grants Defendants’ motion to dismiss without leave to amend as to DCI, and with leave to 1 Court does not reach the alternate arguments in Defendants’ motion to dismiss. 2 II. LEGAL STANDARD 3 In their motion to dismiss, Defendants argue the Court lacks personal jurisdiction over DCI 4 because Plaintiffs have not sufficiently alleged DCI’s connection to California. Mot. at 15. The 5 Court additionally considers whether it may exercise personal jurisdiction over Strand Consult and 6 Layton.1 “This court must consider jurisdiction even if the parties have not challenged it.” 7 Roberts v. United States, 887 F.2d 899, 900 (9th Cir. 1989) (citing Louisville & Nashville R. Co. v. 8 Mottley, 211 U.S. 149, 152 (1908)). 9 “It is the plaintiff’s burden to establish jurisdiction.” Ziegler v. Indian River Cnty., 64 F.3d 10 470, 473 (9th Cir. 1995). The plaintiff needs only to make a prima facie showing of jurisdiction to 11 survive a jurisdictional challenge on a motion to dismiss, when the court acts on a defendant’s 12 motion to dismiss under Rule 12(b)(2) without holding an evidentiary hearing. Id. While the 13 Court “may not assume the truth of allegations in a pleading which are contradicted by 14 affidavit,” CollegeSource, Inc. v. AcademyOne, Inc., 653 F.3d 1066, 1073 (9th Cir. 2011) (internal 15 quotation marks omitted), the Court must resolve conflicts between the facts contained in the 16 parties’ affidavits in the plaintiff’s favor. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 17 797, 800 (9th Cir. 2004). 18 A. California Personal Jurisdiction 19 There are two types of personal jurisdiction – general and specific jurisdiction. Ranza v. 20 Nike, Inc., 793 F.3d 1059, 1068 (9th Cir. 2015). “[G]eneral jurisdiction requires affiliations so 21 continuous and systematic as to render the foreign corporation essentially at home in the forum 22 State, i.e., comparable to a domestic enterprise in that State.” Daimler AG v. Bauman, 571 U.S. 23 117, 133 n.11 (2014) (internal quotations, citations, and alterations omitted). Plaintiffs do not 24 contend that the Defendants are “at home” in California, therefore, only specific jurisdiction is at 25 issue. 26 Specific jurisdiction must comport with the forum state’s long-arm statute, and with 27 1 constitutional requirements of due process. Ziegler, 64 F.3d at 473; Daimler, 571 U.S. at 126. 2 California’s long-arm statute extends jurisdiction to the limits imposed by the Due Process 3 Clause. Cal. Code Civ. P. § 410.10; see also Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 4 1218, 1223 (9th Cir. 2011) (“California’s long-arm statute . . . is coextensive with federal due 5 process requirements, so the jurisdictional analyses under state law and federal due process are the 6 same.”). This Court must determine whether exercising specific personal jurisdiction over 7 Defendants offends due process. 8 Due process limits a court’s power to “render a valid personal judgment against a 9 nonresident defendant.” See World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 291 10 (1980). “For a court to exercise personal jurisdiction over a nonresident defendant consistent with 11 due process, that defendant must have certain minimum contacts with the relevant forum such that 12 the maintenance of the suit does not offend traditional notions of fair play and substantial 13 justice.” Id. (quoting Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)) (internal quotation 14 marks omitted); see also Walden v. Fiore, 571 U.S. 277, 286 (2014) (“Due process requires that a 15 defendant be haled into court in a forum State based on his own affiliation with the State, not 16 based on the random, fortuitous, or attenuated contacts he makes by interacting with other persons 17 affiliated with the State.”) (internal quotations omitted). 18 Specific jurisdiction exists if: (1) the defendant has performed some act or consummated 19 some transaction with the forum by which it purposefully availed itself of the privilege of 20 conducting business in California; (2) the plaintiff’s claims arise out of or result from the 21 defendant’s forum-related activities; and (3) the exercise of jurisdiction is reasonable. Rio 22 Properties, Inc. v. Rio Int'l Interlink, 284 F.3d 1007, 1019 (9th Cir. 2002) (citing Burger King 23 Corp. v. Rudzewicz, 471 U.S. 462, 475-76 (1985)). “The plaintiff bears the burden on the first two 24 prongs, but once both are established, the defendant must come forward with a ‘compelling case’ 25 that the exercise of jurisdiction would not be reasonable.” Id. (internal citations omitted) (citing 26 Boschetto v. Hansing, 539 F.3d 1011, 1016 (9th Cir. 2008)). 27 B. Nationwide Personal Jurisdiction 1 jurisdiction over a defendant if “the defendant is not subject to jurisdiction in any state’s courts of 2 general jurisdiction.” Fed. R. Civ. P. 4(k)(2). “Under Rule 4(k)(2), the due process analysis is 3 nearly identical to traditional personal jurisdiction analysis . . . [but] rather than considering 4 contacts between [the defendant] and the forum state, we consider contacts with the nation as a 5 whole.” Ayla, LLC v. Alya Skin Pty. Ltd., 11 F.4th 972, 979 (9th Cir. 2021) (internal citations 6 omitted) (citing Holland Am. Line Inc. v. Wärtsilä N. Am., Inc., 485 F.3d 450, 462 (9th Cir. 7 2007)). 8 III. DISCUSSION 9 The Court analyzes in turn whether there is personal jurisdiction over (a) DCI, and (b) 10 Strand Consult and Layton. 11 A. Personal Jurisdiction over DCI 12 DCI is an Arizona limited liability company with its principal place of business in 13 Washington, D.C. FAC ¶ 24. Plaintiffs acknowledge that “[e]ach member of DCI is a citizen of a 14 state other than California.” Id. Because DCI is an out-of-forum defendant,2 Plaintiffs are 15 required to show that: (1) DCI purposefully availed itself of the privilege of conducting activities 16 in California, thereby invoking the benefits and protections of its laws; (2) Plaintiffs’ claims arise 17 out of Defendants’ California-related activities; and (3) the exercise of jurisdiction would be 18 reasonable. Ziegler, 64 F.3d at 473. 19 1. Purposeful Availment 20 If a case sounds in tort, as here, courts employ a purposeful direction test, often referred to 21 as the “effects” test. Calder v. Jones, 465 U.S. 783, 788 (1984). Under the Calder “effects” test, 22 jurisdiction may attach if an out-of-forum defendant engages in conduct aimed at, and having 23 effect in, the situs state. Id. at 789. “[T]he three elements of purposeful availment in tort cases 24 are: (1) intentional action; (2) aimed at the forum state; and (3) causing harm that the defendant 25

26 2 Plaintiffs have offered little in the amended complaint specific to DCI or DCI’s role in the alleged conduct. Throughout the amended complaint, Plaintiffs group the Defendants together, 27 arguing that DCI participated in the alleged conduct via their connection to Strand Consult and 1 should have anticipated would be suffered in the forum state.” Ziegler, 64 F.3d at 474. 2 Importantly, a plaintiff’s connection to a defendant’s conduct in the forum should not drive the 3 jurisdictional analysis. Axiom Foods, Inc. v. Acerchem Int’l, Inc., 874 F.3d 1064, 1070 (9th Cir. 4 2017); Walden, 571 U.S. at 285. 5 i. Intentional Action 6 Under the first prong, Plaintiffs must show that DCI committed an intentional act. 7 Schwarzenegger, 374 F.3d at 806. To satisfy the intentional act prong, “the defendant must act 8 with the ‘intent to perform an actual, physical act in the real world.’” Picot v. Weston, 780 F.3d 9 1206, 1214 (9th Cir. 2015). “The threshold of what constitutes an intentional act is relatively 10 low.” AirWair Int’l Ltd. v. Schultz, 73 F. Supp. 3d 1225, 1233 (N.D. Cal. 2014). Here, Plaintiffs 11 allege that “DCI funded China Tech Threat and authored false, misleading, and disparaging 12 statements about YMTC,” which is an intentional action. 13 ii. Express Aim 14 Under the second prong, Plaintiffs must demonstrate that DCI “expressly aimed” its 15 intentional acts at the forum. Schwarzenegger, 374 F.3d at 802. The central question for 16 evaluating if an action was “expressly aimed” is whether the defendant “reached out beyond its 17 home—by, for example, exploiting a market in the forum state.” Ford Motor Co. v. Mont. Eighth 18 Judicial Dist. Ct., 592 U.S. 351, 359 (2021) (quotations and alterations omitted). A defendant 19 does not purposefully direct its activities at the forum state when the unilateral activity of the 20 plaintiff or a third party is all that connects the defendant to the forum state. See Walden, 571 U.S. 21 at 284–85 (citing World-Wide Volkswagen Corp., 444 U.S. at 291–92). 22 Plaintiffs allege that “[e]ach Defendant intentionally directed false and misleading 23 statements through the China Tech Threat website at [YMT – USA] and California, knowing 24 [YMT – USA] maintained its principal place of business in this district.” FAC ¶ 25. Plaintiffs’ 25 case centers on the China Tech Threat website, which “disseminates information and commentary 26 targeting technology policy and markets.” Id. ¶ 22. The China Tech Threat website is a passive 27 website, it “disseminates” and publishes articles. It is not interactive in the sense that users can 1 (9th Cir. 1997) (distinguishing between “passive” and “interactive” websites, where, if interactive, 2 “users can exchange information with the host computer”). 3 “It is well settled that [m]ere passive operation of a website is insufficient to demonstrate 4 express aiming.” Herbal Brands, Inc. v. Photoplaza, Inc., 72 F.4th 1085, 1091 (9th Cir. 2023), 5 cert. denied, 144 S. Ct. 693 (2024) (internal citations omitted). “Not all material placed on the 6 Internet is, solely by virtue of its universal accessibility, expressly aimed at every state in which it 7 is accessed.” Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218, 1231 (9th Cir. 2011) 8 (website with membership club and ability to submit news tips and photos was interactive). Even 9 “operation of an interactive website does not, by itself, establish express aiming,” without 10 “‘something more’—conduct directly targeting the forum.” Id. at 1229; Briskin v. Shopify, Inc., 11 135 F.4th 739, 758 (9th Cir. 2025) (holding that “an interactive platform ‘expressly aims’ its 12 wrongful conduct toward a forum state when its contacts are its ‘own choice and not “random, 13 isolated, or fortuitous”’ . . . even if that platform cultivates a ‘nationwide audience[ ] for 14 commercial gain’”; affirming “principle of requiring ‘something more’ to demonstrate ‘express 15 aiming.’”). 16 When the website itself is the only jurisdictional contact, the Court’s analysis turns on 17 whether there is “something more” or “conduct directly targeting the forum.” See, e.g., Mavrix 18 647 F.3d at 1229–31 (defendant expressly aimed the content of “celebrity-gossip.net” at California 19 for commercial gain because the company knew about its favorable customer base in California). 20 Here, the Court finds that Plaintiffs have not adequately alleged that there is “something 21 more” that ties DCI to California. Plaintiffs argue that DCI availed itself of California by 22 operating China Tech Threat to “specifically to influence California business decisions and harm 23 YMTC’s California operations.” FAC ¶ 27. Plaintiffs include a China Tech Threat article as an 24 Exhibit, where the website’s “tag line” is visible: “We study the problems of technology produced 25 by the People’s Republic of China and suggest policy solutions to protect the security, privacy, 26 and prosperity of all Americans.” FAC, Ex. 3 at 3. Plaintiffs also rely on a singular article in 27 support of this argument – a June 2022 publication, titled “How Apple’s Partnership With Chinese 1 However, a single article about Apple, a company in California, and a website tag line about 2 “prosperity of all Americans” is not enough to show that Defendants specifically directed their 3 entire website towards California. 4 Plaintiffs additionally argue that “Defendants used California-based internet infrastructure 5 to disseminate their false and misleading statements.” FAC at ¶¶ 26, 29. But, Plaintiffs do not 6 connect DCI specifically to the “internet infrastructure.” Id. There is no indication that DCI is 7 involved in the selection of and continued contact with the “internet infrastructure.” 8 Plaintiffs fail to allege sufficient facts to demonstrate that DCI expressly aimed its China 9 Tech Threat website at California. 10 iii. Foreseeable Harm 11 Third, Plaintiffs must demonstrate that DCI knew that its intentional act would cause harm 12 in California. Ziegler, 64 F.3d at 474. Plaintiffs allege a connection to the forum by referring to 13 their own conduct within California, including that YMTC employees “routinely travelled 14 throughout this judicial district to meet and work with potential customers and technical partners” 15 in this district and argue that DCI “knowingly timed and published on the China Tech Threat 16 website to disrupt these discussions, directly and foreseeably harm[ing] YMT Inc.’s business 17 relationships.” FAC ¶ 28. Without more information about DCI’s own actions specifically 18 directed at California, the claims do not involve “contacts that the defendant himself creates with 19 the forum State.” Walden, 571 U.S. at 284-85 (“the plaintiff cannot be the only link between the 20 defendant and the forum”). Furthermore, the claims here are not analogous to website sales cases, 21 where claims “clearly arise out of and relate to Defendants’ conduct of selling those same products 22 to [the forum] residents.” Herbal Brands, 72 F.4th at 1096; see also Ayla, 11 F.4th at 983. This is 23 not sufficient to establish personal jurisdiction. Additionally, given that Plaintiffs did not support 24 their claims with any articles in which Defendants discussed or mentioned YMT – USA, it is 25 difficult to understand how DCI could have anticipated harms that would be suffered in California, 26 as opposed to in China, which was the primary subject of Defendants’ articles on their website. 27 The Court finds that DCI has not purposefully availed itself of this forum. 1 2. Arising Out of California Activities 2 The Court finds that DCI has not purposefully availed itself of California, and Plaintiffs’ 3 claims do not arise out of Defendants’ forum-related activities. “The second requirement of the 4 specific jurisdiction test is that the claims arise out of the defendants’ forum-related activities.” 5 Ziegler, 64 F.3d at 474. Plaintiffs fail to allege facts that show DCI’s role in the publications that 6 allegedly caused harm, what harm specifically was caused in California, and what activities 7 directed at California relate to Plaintiff’s Latham Act claims. Plaintiffs do not allege that YMT 8 – USA, had a relationship to Apple – the subject of the article Plaintiffs primarily rely upon – or 9 that Apple in fact terminated the relationship to the detriment of either of the Plaintiffs. FAC ¶ 27. 10 The Court finds that Plaintiffs’ claims do not arise out of Defendants’ forum-related activities. 11 3. Reasonableness of Exercising Jurisdiction 12 Because Plaintiffs have not satisfied the first two prongs, the Court need not analyze 13 whether, with the burden shifted to the Defendants, there is a “‘compelling case’ that the exercise 14 of jurisdiction would not be reasonable.” Schwarzenegger, 374 F.3d at 802. 15 The Court dismisses Plaintiffs’ claims against DCI without leave to amend. 16 B. Personal Jurisdiction over Strand Consult and Layton 17 Defendant Strand Consult’s principal place of business is Copenhagen, Denmark. FAC 18 ¶ 22. Defendant Layton “is Executive Vice President of Strand Consult and a “co-founder” of 19 China Tech Threat.” Id. at ¶ 23. 20 Plaintiffs allege that Layton “resides and maintains a domicile” in Naples, Florida, because 21 Layton has a Florida address listed on China Tech Threat correspondence, and because “Layton is 22 registered to vote in Florida and regularly engages in business activities and communications 23 related to China Tech Threat within the United States, including California.” Id. Defendants 24 disagree and assert that “Dr. Layton in fact resides and is domiciled in Denmark.” Mot. at 5. 25 In reviewing a motion to dismiss for lack of jurisdiction, the Court will generally consider 26 the disputed facts in the light most favorable to the plaintiff; however, the Court must not assume 27 the truth of allegations in a pleading that are contradicted by an affidavit. CollegeSource, Inc., 653 1 Here, Layton has provided a declaration stating that her “home has been in Denmark since 2 2010, and she intends to remain there”; “[s]he lives in Denmark with her husband and their 3 children”; and “Strand Consult, a Danish company, is Dr. Layton’s only regular employer; she 4 does her work from Denmark except while on business trips.” Declaration of Roslyn Layton, 5 ¶¶ 1-4, ECF No. 65-5. Layton acknowledges the Naples, Florida address cited by Plaintiffs and 6 notes that that was her childhood home, and is her mother’s address, which she has used on 7 correspondence related to China Tech Threat. Id. at ¶¶ 5-7. The Court finds that Layton is 8 domiciled in Denmark. Mississippi Band of Choctaw Indians v. Holyfield, 490 U.S. 30, 48 (1989) 9 (domicile is “established by physical presence in a place” with the “intent to remain there”). 10 Three requirements must be met in order to establish personal jurisdiction over out-of- 11 forum defendants who are not domiciled in any state under Rule 4(k)(2): (1) the claim against the 12 defendant must arise under federal law; (2) the defendant must not be subject to the personal 13 jurisdiction of any state court of general jurisdiction; and (3) the federal court’s exercise of 14 personal jurisdiction must comport with due process. Pebble Beach Co. v. Caddy, 453 F.3d 1151, 15 1159 (9th Cir. 2006). 16 Here, the claims against Defendants “arise under the Lanham Act, 15 U.S.C. § 1125(a), 17 and involve questions of federal law.” FAC ¶ 30. Strand Consult and Layton are domiciled in 18 Denmark and not domiciled in the United States, and the Court has no information to support that 19 they are subject to the personal jurisdiction of any state court of general jurisdiction. The only 20 remaining question for this Court to consider is whether the Court’s exercise of personal 21 jurisdiction over the Defendants would comport with due process. 22 “The due process analysis under Rule 4(k)(2) is nearly identical to traditional personal 23 jurisdiction analysis with one significant difference: rather than considering contacts between [the 24 defendant] and the forum state, [the Court] consider[s] contacts with the nation as a whole.” 25 Axiom Foods, Inc., 874 F.3d at 1072 (quoting Holland Am. Line, 485 F.3d at 462). Specific 26 jurisdiction exists over out-of-forum residents Strand Consult and Layton if (1) they performed 27 some act by which they purposefully directed their activities toward the United States or 1 Plaintiffs’ Lanham Act claims arise out of or result from Defendants’ United States-related 2 activities, and (3) the exercise of jurisdiction is reasonable. Ayla, 11 F.4th at 979. 3 1. Purposeful Availment 4 The analysis of whether Strand Consult and Layton have purposefully availed themselves 5 of jurisdiction in the United States is substantially similar to the above analysis regarding whether 6 DCI availed itself of jurisdiction in California. “[T]he three elements of purposeful availment in 7 tort cases are: (1) intentional action; (2) aimed at the forum state; and (3) causing harm that the 8 defendant should have anticipated would be suffered in the forum state.” Ziegler, 64 F.3d at 474. 9 Importantly, a plaintiff’s connection to a defendant’s conduct in the forum should not drive the 10 jurisdictional analysis. Axiom Foods, Inc., 874 F.3d at 1070; Walden, 571 U.S. at 285 (“the 11 plaintiff cannot be the only link between the defendant and the forum”). 12 i. Intentional Action 13 Plaintiffs allege that Strand Consult and Layton committed an intentional act when they 14 “made demonstrably false and misleading statements of fact in their commercial advertising and 15 promotion.” FAC ¶ 64. Strand Consult and Layton do not dispute that they operate China Tech 16 Threat and wrote articles published on the China Tech Threat website. Mot. at 4. Therefore, the 17 intentional act prong is satisfied. AirWair Int’l Ltd., 73 F. Supp. 3d at 1233 (holding that threshold 18 for intentional act is “relatively low”). 19 ii. Express Aim 20 Because China Tech Threat is a passive website, see Herbal Brands, Inc., 72 F.4th at 1091 21 (mere passive operation of a website is insufficient to demonstrate express aiming), the relevant 22 question is whether the Defendants have engaged in “‘something more,’ namely ‘conduct directly 23 targeting the forum,’” to establish express aiming. Adobe Sys. Inc. v. Nwubah, 2019 WL 6611096, 24 at *6 (N.D. Cal. Dec. 5, 2019). Plaintiffs have not established the existence of “something more.” 25 While China Tech Threat is intended to educate a United States audience with content in English, 26 uses content delivery networks in the United States, and is hosted on a “.com” site, courts have 27 found that such connections are too insignificant to hale foreign Defendants into court in the 1 jurisdiction when defendants’ newsletter had “[a]t least 70 recipients with companies in the United 2 States” and plaintiffs had “fail[ed] to explain the relationship between the 70 recipients and their 3 respective companies.”); Glencore Grain Rotterdam B.V. v. Shivnath Rai Harnarain Co., 284 F.3d 4 1114, 1123 (9th Cir. 2002) (holding that a defendant should not be haled into court as a result of 5 “random,” “fortuitous,” or “attenuated” contacts and declining to exercise Rule 4(k)(2) jurisdiction 6 when the defendant had made seven individual shipments to the East Coast); Holland Am. Line 7 Inc., 485 F.3d at 462 (holding that defendants’ contacts with United States “hardly constitute 8 significant contacts” and declining to exercise Rule 4(k)(2) jurisdiction when defendants made 9 occasional visits to cruise ships and unspecified advertising in various marine publications). 10 In Holland Am. Line, the Ninth Circuit found that “[w]e consistently have held that a mere 11 web presence is insufficient to establish personal jurisdiction.” Id. The Ninth Circuit evaluated a 12 Finnish company’s “entirely passive website and [company’s] advertisements in various marine 13 publications,” finding that the “website does not provide any direct means for purchasing parts or 14 requesting services; it simply provides information on the various products manufactured by the 15 Wärtsilä consortium and redirects potential customers to the appropriate subsidiary.” Id. (applying 16 the same analysis for purposeful direction toward the forum state and the United States under Rule 17 4(k)(2)). Moreover, the Ninth Circuit noted that “[t]he few cases in which our sister circuits have 18 concluded that Rule 4(k)(2) conferred jurisdiction have involved defendants with much more 19 extensive contacts to this country.” Holland Am. Line Inc., 485 F.3d at 462 (citing Mwani v. bin 20 Laden, 417 F.3d 1, 13 (D.C. Cir. 2005) (holding that jurisdiction could be exercised where 21 defendants had engaged in numerous conspiracies to bomb locations in the United States); Adams 22 v. Unione Mediterranea Di Sicurta, 364 F.3d 646, 651 (5th Cir. 2004) (upholding personal 23 jurisdiction under Rule 4(k)(2) where the defendant insurer had directly insured hundreds of 24 claims in the United States)). 25 Plaintiffs argue that Strand Consult and Layton expressly aimed their actions at the United 26 States because “[t]he China Tech Threat webpage uses Cloudflare content delivery network 27 (CDN) services to improve the speed at which the site can be accessed within California,” and 1 the location of content delivery networks is not sufficient to establish personal jurisdiction. 2 See Browne v. McCain, 612 F.Supp.2d 1118, 1124 (C.D. Cal. 2009) (holding that the court did not 3 have personal jurisdiction over a defendant because the location of YouTube servers in California 4 was not enough to show express aim); Prevail Legal v. Justin Gordon, et al., 2021 WL 1947578, 5 at *5 (N.D. Cal. May 14, 2021) (holding that it was “random” that the server hosting Plaintiff’s 6 software code happened to be in California even through principal place of business was in Santa 7 Clara, California); Hungerstation LLC v. Fast Choice LLC, 2020 WL 137160, at *1 (N.D. Cal. Jan 8 13, 2020) (holding that Saudi Arabia-based defendants that used “their then-valid [software] 9 credentials to wrongfully access, copy, and steal . . . repositories of copyrighted and proprietary 10 source code” were not subject to personal jurisdiction because if the party hosts its data with a 11 Silicon Valley company, the Northern District of California would always have jurisdiction); 12 Republic of Kazakhstan v. Ketebaev, 2017 WL 6539897, at *7 (N.D. Cal. Dec. 21, 2017) (“The 13 mere fact that Google—the company that owns the servers—is headquartered in California is not 14 enough to establish that Khrapunov, a Kazakh citizen who resides in Switzerland, expressly aimed 15 his alleged conduct at California.”). 16 Strand Consult and Layton’s use of content delivery networks in California is not enough 17 to establish a connection with the forum. Additionally, Strand Consult and Layton’s 18 administration of a passive website without “something more” is not enough to hale them into 19 court in this forum. 20 iii. Foreseeable Harm 21 The third part of the purposeful direction test is whether Strand Consult and Layton knew 22 that their intentional actions would cause harm in the forum. Ziegler, 64 F.3d at 474. For 23 jurisdictional purposes, a corporation incurs economic loss in the forum of its principal place of 24 business. See CollegeSource, Inc. v. AcademyOne, Inc., 653 F.3d 1066, 1079 (9th Cir. 2011). 25 Here, Plaintiffs’ allegations are that Defendants knowingly “made demonstrably false and 26 misleading statements of fact in their commercial advertising and promotion” that “were intended 27 to exploit xenophobic anxieties and prejudice against YMTC.” FAC ¶ 64. Considering that 1 States. While, by the same logic, it would be foreseeable that YMT – USA’s losses would be felt 2 in the United States, Plaintiffs have not alleged facts showing harm specifically to YMT – USA. 3 Although Plaintiffs satisfied the first prong (“intentional act”) of the purposeful availment 4 test, Plaintiffs did not satisfy the second and third prongs: “aimed at the forum state”; and “causing 5 harm that the defendant should have anticipated would be suffered in the forum state.” Ziegler, 64 6 F.3d at 474. 7 2. Arising Out of United States Related Activities 8 “The second requirement of the specific jurisdiction test is that the claims arise out of the 9 defendants’ forum-related activities.” Ziegler, 64 F.3d at 474. Specific jurisdiction requires a 10 relationship between the forum and the claim. Holland Am. Line Inc., 485 F.3d at 460-61. Here, 11 that relationship is missing. Plaintiffs’ claims concern allegations of a “widespread and 12 coordinated campaign of false and misleading commercial advertising and promotion specifically 13 targeting YMTC and its 3D NAND flash memory products.” FAC ¶ 62. Plaintiffs specifically 14 allege harms incurred by YMTC, which is based in China, but do not connect the harms to YMT 15 – USA or to the forum. Walden, 571 U.S. at 285 (the connection to the forum state must be 16 analyzed with regard “to the defendant’s contacts with the forum State itself, not the defendant’s 17 contacts with persons who reside there.”). The Court finds that Plaintiffs’ claims do not arise out 18 of Defendants’ forum-related activities. 19 3. Reasonableness of Exercising Jurisdiction 20 As with the analysis of personal jurisdiction over DCI, because Plaintiffs have not satisfied 21 the first two prongs, the Court need not analyze whether, with the burden shifted to the 22 Defendants, there is a “‘compelling case’ that the exercise of jurisdiction would not be 23 reasonable.” Schwarzenegger, 374 F.3d at 802.3 24 3 Even if the Court were to analyze the reasonableness of exercising jurisdiction over Strand 25 Consult and Layton, the Court would find it to be unreasonable because, inter alia, Defendants had limited personal interjections into the forum; the substantial burden on the Denmark domiciled 26 Defendants to litigate in this forum; and the fact that an alternate forum is available in Denmark. Ayla, 11 F.4th at 983 (Courts use seven factors to evaluate whether jurisdiction would be 27 reasonable: (i) the extent of the [defendant’s] purposeful interjection into the forum state; (ii) the 1 Because this Court concludes that Plaintiffs have not adequately alleged purposeful 2 direction or that the claims against Strand Consult and Layton arise out of or relate to their 3 contacts with the United States, this Court holds that Plaintiffs have not adequately alleged 4 specific jurisdiction over Strand Consult and Layton based on their nationwide contacts. The 5 Court dismisses Plaintiffs’ claims against Strand Consult and Layton with leave to amend to allege 6 facts sufficient to establish the Court’s personal jurisdiction over Strand Consult and Layton. 7 C. Discovery 8 While a district court is vested with broad discretion to permit or deny jurisdictional 9 discovery, courts generally require a plaintiff to make out a “colorable basis” for jurisdiction to 10 warrant discovery. See Crouch v. Ruby Corp., 639 F. Supp. 3d 1065, 1083 (S.D. Cal. 2022) 11 (requiring fuller showing of jurisdictional facts before jurisdictional discovery); see also Teras 12 Cargo Transp. (Am.) LLC v. Cal Dive Int’l (Austl.) Pty Ltd., 2015 WL 6089276, at *8 (N.D. Cal. 13 Oct. 16, 2015) (citing cases). Courts may properly deny jurisdictional discovery where “there is 14 insufficient evidence to give rise to more than a ‘hunch’” that discovery will make out a case for 15 exercising personal jurisdiction over a defendant. See id. (denying jurisdictional discovery and 16 observing that “speculation ‘cannot rise above the “mere hunch” bar that the Ninth Circuit requires 17 cleared to obtain jurisdictional discovery’”) (quoting Corcera Sols., LLC v. Razor, Inc., 2014 WL 18 587869, at *3 (N.D. Cal. Feb. 14, 2014)). That approach applies here: Plaintiffs’ claims are based 19 on their own presence in California, which is an insufficient basis for finding specific jurisdiction. 20 The claims do not arise out of or are related to Defendants’ forum-related activity. Walden, 571 21 U.S. at 286. Although Plaintiffs are granted leave to amend as to personal jurisdiction over Strand 22 Consult and Layton, the Court finds that jurisdictional discovery is not warranted. 23 D. Request for Judicial Notice 24 In support of its motion to dismiss, Defendants request that the Court take judicial notice 25 of the defendant's state; (iv) the forum state’s interest in adjudicating the dispute; (v) the most 26 efficient judicial resolution of the controversy; (vi) the importance of the forum to the plaintiff's interest in convenient and effective relief; and (vii) the existence of an alternative forum.) Most of 27 the factors indicate that exercising jurisdiction over the Denmark-based Defendants would be ] of three public webpages. Mot. at 25. The Court declines to rule on Defendants’ requests for 2 || judicial notice, as the Court did not rely on any of those sources in resolving the present motion. 3 || IV. CONCLUSION 4 The Court GRANTS Defendants’ motion to dismiss based on lack of personal jurisdiction 5 over DCI without leave to amend, and with leave to amend as to personal jurisdiction over Strand 6 || Consult and Layton. 7 Plaintiffs are permitted to file a second amended complaint by June 10, 2025, to allege 8 specific facts that establish that Strand Consult and Layton purposefully availed themselves of the 9 || forum and that Plaintiffs’ claims arise out of Strand Consult and Layton’s forum-related activities. 10 IT IS SO ORDERED. 11 Dated: May 20, 2025

5 Noél Wise 13 United States District Judge

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