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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`ZTE (USA) INC.,
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`Plaintiff,
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`v.
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`AGIS SOFTWARE DEVELOPMENT LLC,
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`Defendant.
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`
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`Case No. 18-cv-06185-HSG
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`ORDER DENYING MOTION TO
`SUPPLEMENT RECORD; DENYING
`MOTION TO DISMISS; AND
`DENYING MOTION FOR SANCTIONS
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`Re: Dkt. Nos. 41, 48, 107
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`Pending before the Court is Defendant AGIS Software Development LLC’s (“AGIS
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`Software”) motion to dismiss the Second Amended Complaint (“SAC”) for lack of personal
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`jurisdiction and Defendant’s motion for sanctions. See Dkt. Nos. 41, 48. The Court held a
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`hearing on the motions and took them under submission on June 14, 2019. See Dkt. No. 85.
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`Plaintiff subsequently filed a motion to supplement the record. See Dkt. No. 107. The Court finds
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`this motion appropriate for disposition without oral argument and the matter is deemed submitted.
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`See Civil L.R. 7-1(b).
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`Having carefully considered the parties’ arguments, the Court DENIES Plaintiff’s motion
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`to supplement the record, DENIES WITHOUT PREJUDICE Defendant’s motion to dismiss,
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`and DENIES Defendant’s motion for sanctions.
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`I. BACKGROUND
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`A. Procedural History
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`On June 21, 2017, AGIS Software filed a patent infringement action in the Eastern District
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`of Texas against ZTE (USA) Inc., as well as ZTE Corporation and ZTE (TX) Inc. See AGIS
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`Software Dev. LLC v. ZTE Corp., No. 2:17-cv-517 (E.D. Tex. June 21, 2017) (“AGIS I”), ECF No.
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`1. Over AGIS Software’s objections, the Texas court granted the ZTE entities’ motion to dismiss
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`Northern District of California
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`United States District Court
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`Case 4:18-cv-06185-HSG Document 114 Filed 09/12/19 Page 2 of 12
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`for improper venue and transferred the action to the Northern District of California. See AGIS I,
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`ECF No. 85. In doing so, the district court reasoned that ZTE (USA) did not have a regular and
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`established place of business in the Eastern District of Texas. Id. at 3–7. ZTE (USA) requested
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`that the case be transferred to the Northern District of California, and the district court noted that
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`AGIS Software did not proffer an alternative. Id. at 7. AGIS Software subsequently filed a
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`voluntary dismissal, and the district court dismissed the patent infringement action without
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`prejudice. See id., ECF Nos. 86, 87.
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`On the day of the dismissal, October 9, 2018, Plaintiff filed this declaratory judgment
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`action in the Northern District of California, initially naming three defendants: (1) AGIS
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`Software; (2) AGIS Holdings, Inc. (“AGIS Holdings”); and (3) Advanced Ground Information
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`Systems, Inc. (“AGIS Inc.”). See Dkt. No. 1. Plaintiff later amended the complaint, removing
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`AGIS Holdings and AGIS Inc. as defendants. See Dkt. No. 18. In the operative Second Amended
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`Complaint (“SAC”), Plaintiff seeks a declaratory judgment of non-infringement or
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`unenforceability against Defendant AGIS Software as to five patents.1 See Dkt. No. 39.
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`B. Factual Allegations
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`Plaintiff alleges that Defendant AGIS Software is a wholly-owned subsidiary of AGIS
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`Holdings. See SAC ¶ 3. AGIS Software, for its part, is a Texas limited liability company with its
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`principal place of business in Texas. See id. ¶ 7. Plaintiff alleges that Defendant asserted the
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`same patents-in-suit in other patent infringement actions2; some of these actions were against
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`California-based companies; and as part of these cases, Defendant “conducted meaningful
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`enforcement activities in California,” including traveling to and deposing witnesses there. Id.
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`¶¶ 8–10.
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`Defendant now moves to dismiss the complaint, contending that notwithstanding
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`Plaintiff’s allegations, the Court lacks personal jurisdiction over AGIS Software. See Dkt. No. 41;
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`1 U.S. Patent Nos. 8,213,970; 9,408,055; 9,445,251; 9,467,838; and 9,749,829 (the “patents-in-
`suit”).
`2 See AGIS I; AGIS Software Dev. LLC v. Huawei Device USA Inc. et al., No. 2:17-cv-513 (E.D.
`Tex.); AGIS Software Dev. LLC v. LG Electronics, Inc., No. 2:17-cv-515 (E.D. Tex.); AGIS
`Software Dev. LLC v. Apple Inc., No. 2:17-cv-516 (E.D. Tex.).
`2
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`Northern District of California
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`United States District Court
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`Case 4:18-cv-06185-HSG Document 114 Filed 09/12/19 Page 3 of 12
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`see also SAC ¶ 3. Defendant also seeks monetary sanctions against Plaintiff for filing this action
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`in the Northern District of California without a proper basis for exercising personal jurisdiction.
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`See Dkt. No. 48. In support of its motion to dismiss, Defendant has filed a declaration from
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`Malcolm K. Beyer, Jr., Defendant’s Chief Executive Officer, stating that Mr. Beyer resides in
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`Florida and that AGIS Software:
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`•
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`•
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`is the “sole and exclusive owner” of the patents-in-suit;
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`is not registered to do business in California;
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`• does not have a registered agent for service of process in California;
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`• does not have “offices, employees, equipment, bank accounts or other assets in
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`California”;
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`• does not pay taxes in California;
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`• does not manufacture or sell products in California;
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`• does not solicit or engage in business in California;
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`• does not recruit employees in California;
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`• does not own, rent, or lease any property in California;
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`• has not filed a lawsuit in California; and
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`• has not retained counsel in California related to enforcing the patents-in-suit.
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`See Dkt. No. 41-1 ¶¶ 4–22.
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`Plaintiff does not dispute these facts. Rather, Plaintiff alleges that the Court should
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`consider contacts that Defendant’s related entities have with California. See Dkt. No. 59 at 8–10.
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`Additionally, after Defendant’s motion to dismiss and motion for sanctions had been heard and
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`taken under submission, Plaintiff filed a motion to supplement the record. See Dkt. No. 107. In it,
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`Plaintiff seeks to add two transcripts, which it states “suggest that AGIS conducted and solicited
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`business in California.” See id. at 3.
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`II. LEGAL STANDARD
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`Federal Rule of Civil Procedure 12(b)(2) authorizes a defendant to seek dismissal of an
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`action for lack of personal jurisdiction. See Fed. R. Civ. P. 12(b)(2). Federal Circuit law governs
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`the personal jurisdiction analysis in a patent-related action. See Breckenridge Pharm., Inc. v.
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`Northern District of California
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`United States District Court
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`Case 4:18-cv-06185-HSG Document 114 Filed 09/12/19 Page 4 of 12
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`Metabolite Labs., Inc., 444 F.3d 1356, 1361 (Fed. Cir. 2006). In analyzing personal jurisdiction,
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`the Federal Circuit engages in a two-part inquiry: (1) whether the state’s long-arm statute
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`authorizes service of process on the defendant; and (2) whether the exercise of jurisdiction
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`comports with due process. Celgard, LLC v. SK Innovation Co., 792 F.3d 1373, 1377 (Fed. Cir.
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`2015).
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`Where a state, like California, “authorize[s] its courts to exercise jurisdiction over persons
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`on any basis not inconsistent with . . . the Constitution of the United States,” see Walden v. Fiore,
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`571 U.S. 277, 283 (2014), federal courts ask whether the exercise of jurisdiction over a defendant
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`“comports with the limits imposed by federal due process,” Daimler AG v. Bauman, 571 U.S. 117,
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`125 (2014); see also Cal. Civ. Proc. Code § 410.10 (California’s long-arm statute is co-extensive
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`with the federal due process clause). “Due process requires that the defendant have sufficient
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`‘minimum contacts with [the forum state] such that maintenance of the suit does not offend
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`traditional notions of fair play and substantial justice.’” Celgard, 792 F.3d at 1377 (quoting Int’l
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`Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)).
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`There are two categories of personal jurisdiction a plaintiff can invoke: general and
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`specific. LSI Indus. Inc. v. Hubbell Lighting, Inc., 232 F.3d 1369, 1375 (Fed. Cir. 2000).
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`“General jurisdiction arises when a defendant maintains ‘continuous and systematic’ contacts with
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`the forum state even when the cause of action has no relation to those contacts.” LSI Indus. Inc.,
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`232 F.3d at 1375 (quoting Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414–
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`16 (1984)). “Specific jurisdiction ‘arises out of’ or ‘relates to’ the cause of action even if those
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`contacts are ‘isolated and sporadic.’” Id. (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462,
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`472–73 (1985)).
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`When a district court’s determination of personal jurisdiction is based on affidavits and
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`other written materials rather than an evidentiary hearing, the plaintiff only bears the burden of
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`making a prima facie showing of jurisdictional facts. Celgard, 792 F.3d at 1378. Under a prima
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`facie standard, the court must resolve all factual disputes, including conflicts in affidavits, in the
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`plaintiff’s favor. Avocent Huntsville Corp. v. Aten Int’l Co., 552 F.3d 1324, 1329 (Fed. Cir.
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`2008).
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`Northern District of California
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`United States District Court
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`Case 4:18-cv-06185-HSG Document 114 Filed 09/12/19 Page 5 of 12
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`III. ANALYSIS
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`A. Personal Jurisdiction
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`Plaintiff asserts that the Court has both general and specific jurisdiction over Defendant.3
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`See SAC ¶ 7. Because Plaintiff relies, at least in part, on the contacts of Defendant’s related
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`entities—particularly AGIS Inc.—for purposes of establishing personal jurisdiction, the Court first
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`addresses Plaintiff’s imputation argument.
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`i.
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`Imputation
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`Plaintiff posits that AGIS Software is a sham entity designed to preclude jurisdiction
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`outside the Eastern District of Texas.4 See SAC ¶ 11; see also Dkt. No. 59 at 1, 4–10. As such,
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`Plaintiff argues that the activities of AGIS Inc. “should be attributed” to AGIS Software and that
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`“the two entities should be treated jointly for personal jurisdiction.” See Dkt. No. 59 at 10.
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`The Federal Circuit has cautioned that “the corporate form is not to be lightly cast aside”
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`and “the corporate entity should be recognized and upheld, unless specific, unusual circumstances
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`call for an exception.” 3D Sys., Inc. v. Aarotech Labs., Inc., 160 F.3d 1373, 1380 (Fed. Cir. 1998).
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`Nevertheless, the corporate form is not intended to frustrate personal jurisdiction. See In re
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`Microsoft Corp., 630 F.3d 1361, 1364–65 (Fed. Cir. 2011) (collecting cases). Accordingly, “the
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`contacts of a third-party may be imputed to the defendant under either an agency or alter ego
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`theory.” Celgard, 792 F.3d at 1379. Courts have invoked these theories where (1) “there is a
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`unity of interest and ownership such that separate personalities [of the two entities] no longer
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`exist”; and (2) “failure to disregard [their separate identities] would result in fraud or injustice.”
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`See Ranza v. Nike, Inc., 793 F.3d 1059, 1073 (9th Cir. 2015) (quotations omitted).
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`3 To the extent Plaintiff suggests that the district court in AGIS I addressed the issue of personal
`jurisdiction, the Court is not persuaded. The district court only analyzed venue under 28 U.S.C.
`§ 1400(b), and was careful to acknowledge that its analysis was limited to the specific facts before
`it. See AGIS I, ECF. No. 85 at 6, n.5. The Court is similarly unpersuaded that the district court’s
`personal jurisdiction analysis in Life360, Inc. v. Advanced Ground Information Systems, Inc., No.
`5:15-cv-00151-BLF (N.D. Cal.), somehow settles the issue, as AGIS Software was not a party to
`that suit. The Court thus conducts its own independent analysis.
`4 The Court declines Defendant’s invitation to disregard Plaintiff’s imputation argument because
`Plaintiff raised it in opposition, see Dkt. No. 47 at 2–3. The nature of Defendant and AGIS Inc.’s
`relationship directly bears on the question of personal jurisdiction. Cf. Beverly Hills Fan Co. v.
`Royal Sovereign Corp., 21 F.3d 1558, 1562–63 (Fed. Cir. 1994) (considering declaration
`submitted after complaint for purposes of personal jurisdiction analysis).
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`Northern District of California
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`United States District Court
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`Case 4:18-cv-06185-HSG Document 114 Filed 09/12/19 Page 6 of 12
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`The Federal Circuit has also noted that exercising jurisdiction over a subsidiary may also
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`be “fair and reasonable” for purposes of due process where the parent company:
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`Incorporate[d] a holding company in another state, transfer[red] its
`patents to the holding company, arrange[d] to have those patents
`licensed back to itself by virtue of its complete control over the
`holding company, and threaten[ed] its competitors with infringement
`without fear of being a declaratory judgment defendant, save perhaps
`in the state of incorporation of the holding company.
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`Dainippon Screen Manufacturing Co. v. CFMT, Inc., 142 F.3d 1266, 1267, 1270–71, & n.2 (Fed.
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`Cir. 1998) (analyzing whether asserting personal jurisdiction was “reasonable and fair” after
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`finding a subsidiary had sufficient contacts, on its own, with the forum state). In short, the Federal
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`Circuit suggested in Dainippon that the subsidiary was created specifically to manipulate
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`jurisdiction. Id. at 1271, & n.3 (“[A] patent holding subsidiary . . . cannot fairly be used to
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`insulate patent owners from defending declaratory judgment actions in those fora where its parent
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`company operates under the patent and engages in activities sufficient to create personal
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`jurisdiction and declaratory judgment jurisdiction.”); accord Google Inc. v. Rockstar Consortium
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`U.S. LP, No. C 13-5933 CW, 2014 WL 1571807, at *3–4, & n.3 (N.D. Cal. Apr. 17, 2014)
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`(finding evidence supported plaintiff’s allegation that patent-holding subsidiary was alter ego of
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`its parent, and “created . . . solely to dodge jurisdiction”).
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`To support imputation in this case, Plaintiff asserts that (1) the two entities have
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`overlapping officers, employees, and past legal representation,5 Dkt. No. 59-2, Ex. A, ¶ 17, Dkt.
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`No. 59-14, Ex. M at 21, Dkt. No. 30-2, ¶¶ 2–3; (2) Defendant’s CEO once stated in a deposition
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`that Defendant and AGIS Inc. “work closely with one another,” Dkt. No. 59-2, Ex. A, ¶ 8; and
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`(3) AGIS Inc. has a non-exclusive license for the patents-in-suit from Defendant, see Dkt. No. 59-
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`3, Ex. B. Yet these facts, even if true, do not establish that Defendant has no identity separate and
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`apart from AGIS Inc. At best, Plaintiff has established that the entities share a parent-subsidiary
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`relationship, which is “insufficient, on its own, to justify imputing one entity’s contacts with a
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`5 The Court notes that some of this alleged “overlap” occurred before Defendant was created. See
`Dkt. No. 30-2, ¶¶ 2–3; see also Advanced Ground Information Systems, Inc. v. Life360, Inc., No.
`9:14-cv-80651-DMM (S.D. Florida), ECF. No. 32 at 2–3.
`6
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`Northern District of California
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`United States District Court
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`Case 4:18-cv-06185-HSG Document 114 Filed 09/12/19 Page 7 of 12
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`forum state to another for the purpose of establishing personal jurisdiction.” See Ranza, 793 F.3d
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`at 1070; compare Google Inc., No. C 13-5933 CW, 2014 WL 1571807, at *3–4 (finding
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`circumstances suggested subsidiary was a sham where, inter alia, all subsidiary employees also
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`work for the parent; all subsidiary officers are also parent board members; and the parent and
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`subsidiary operate out of the same suite).
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`Plaintiff also contends that Defendant’s very creation supports a finding that it was
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`designed to avoid jurisdiction outside Texas. See Dkt. No. 59 at 10.
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`• Defendant first registered with the Texas Secretary of State on June 1, 2017, see
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`Dkt. No. 59-13;
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`• Approximately two weeks later, on June 15, 2017, AGIS Inc. assigned the patents-
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`in-suit to AGIS Holdings, who in turn assigned them to Defendant, see SAC ¶ 11;
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`Dkt. No. 59-15, Ex. N; and
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`• The day after the assignments became effective, Defendant filed four patent
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`infringement actions in Texas. See Section I, n.2, supra.
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`The Court acknowledges that the Federal Circuit’s dicta in Dainippon cautions that patent holding
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`subsidiaries cannot be used to circumvent jurisdiction. See Dainippon, 142 F.3d at 1270–71. Yet
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`the Federal Circuit has not held that the mere assignment of patents to a subsidiary renders that
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`assignee a sham entity. See Dainippon, 142 F.3d at 1267, 1270–71. Although suggestive, the
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`Court does not find that Plaintiff’s allegations establish that Defendant is merely the alter ego of
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`AGIS Inc. or was created solely to circumvent jurisdiction. See Ranza, 793 F.3d at 1073. The
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`Court finds that imputation would be improper on the basis of this record, and thus cabins its
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`subsequent analysis to those allegations specifically against Defendant.6
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`ii. General Jurisdiction
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`“[A]n assertion of general jurisdiction requires that the defendant have continuous and
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`systematic contacts with the forum state,” although such contacts will still confer jurisdiction
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`6 Because the Court finds imputation is improper, the Court does not consider the two transcripts
`Plaintiff has attached to its motion to supplement the record. See Dkt. No. 107. Both transcripts
`relate solely to AGIS Inc. and reflect events that occurred before Defendant was created. Id. The
`Court therefore DENIES Plaintiff’s motion to supplement the record.
`7
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`Northern District of California
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`United States District Court
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`Case 4:18-cv-06185-HSG Document 114 Filed 09/12/19 Page 8 of 12
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`“even when the cause of action has no relationship with those contacts.” Avocent, 552 F.3d at
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`1331–32 (quotation omitted). This is a high bar. As the Supreme Court has explained, for
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`purposes of general jurisdiction, such contacts must “render [the entity] essentially at home in the
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`forum State.” Daimler, 571 U.S. at 122.
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`Here, Plaintiff contends that Defendant is subject to the Court’s general jurisdiction based
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`on Defendant’s marketing, promotion, and sales of its “LifeRing and HoundDog applications” in
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`California. See Dkt. No. 59 at 10–11. Plaintiff also asserts that Defendant has an interactive
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`website and mobile applications available in California, and has a “strategic partnership” with
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`Green Hills Software, which is based in Santa Barbara, California. Id. at 11. The Court is
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`skeptical that these contacts would render an entity “essentially at home” in California, but more
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`fundamentally, these alleged contacts relate to AGIS Inc. and not to Defendant. See Dkt. No. 59-
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`7, Ex. F; Dkt. No. 59-9, Ex. H. As Plaintiff acknowledges, Defendant “is a limited liability
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`company organized and existing under the laws of the State of Texas, and maintains its principal
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`place of business” in Texas. See SAC ¶ 3. Plaintiff has failed to make a prima facie showing that
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`the Court has general jurisdiction over Defendant.
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`iii.
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`Specific Jurisdiction
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`When analyzing specific personal jurisdiction, the Federal Circuit considers whether
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`“(1) the defendant purposefully directed its activities at residents of the forum, (2) the claim arises
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`out of or relates to those activities, and (3) assertion of personal jurisdiction is reasonable and
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`fair.” Avocent, 552 F.3d at 1332 (quotations omitted). “The first two factors correspond with the
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`‘minimum contacts’ prong of the International Shoe analysis, and the third factor corresponds to
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`the ‘fair play and substantial justice’ prong of the analysis.” Id. (quotation omitted). Additionally,
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`in a declaratory judgment action, “the nature of the claim . . . arises out of or relates to the
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`activities of the defendant patentee in enforcing the patent or patents in suit.” Id. Thus, “only
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`enforcement or defense efforts related to the patent rather than the patentee’s own
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`commercialization efforts are to be considered for establishing specific personal jurisdiction.”
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`Autogenomics, Inc. v. Oxford Gene Tech. Ltd., 566 F.3d 1012, 1020 (Fed. Cir. 2009) (emphasis
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`added).
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`Northern District of California
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`United States District Court
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`Case 4:18-cv-06185-HSG Document 114 Filed 09/12/19 Page 9 of 12
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`Stripped down to those allegations solely related to Defendant and the patents-in-suit,
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`Plaintiff contends that the Court has specific jurisdiction over Defendant because (1) Defendant
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`filed patent infringement suits against California residents in the Eastern District of Texas; and
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`(2) in litigating those actions, Defendant conducted discovery in California, including traveling
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`there for depositions and subpoenaing third-party entities that reside in California. See Dkt. No.
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`59 at 14–22; SAC ¶¶ 8, 10, 12. The Court addresses each in turn.
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`First, Plaintiff explains that Defendant filed patent infringement actions against Apple,
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`Inc., which is incorporated under the laws of California, and against ZTE (TX), Inc., which
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`Plaintiff asserts is a California resident.7 See AGIS Software Development LLC v. Apple, Inc., No.
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`2:17-cv-00516-JRG (E.D. Tex.), ECF No. 1 at ¶ 2 (“Upon information and belief, Defendant
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`Apple is a California corporation having a principal place of business in Cupertino, California.”);
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`AGIS I, ECF No. 1 (Complaint against, inter alia, ZTE (TX), Inc.). Even assuming ZTE (TX),
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`Inc. is indeed a resident of California, Defendant filed these two actions in the Eastern District of
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`Texas. Id. Courts have repeatedly found that out-of-state enforcement activities are insufficient to
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`establish personal jurisdiction. See, e.g., Radio Sys. Corp. v. Accession, Inc., 638 F.3d 785, 792
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`(Fed. Cir. 2011) (“[E]nforcement activities taking place outside the forum state do not give rise to
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`personal jurisdiction in the forum.”); AU Optronics Corp. Am. v. Vista Peak Ventures, LLC, No.
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`18-CV-04638-HSG, 2019 WL 690282, at *3 (N.D. Cal. Feb. 19, 2019) (collecting cases); Kyocera
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`Int’l, Inc. v. Semcon IP, Inc., No. 18-cv-1575-CAB-MDD, 2018 WL 5112056, at *3 (S.D. Cal.
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`Oct. 19, 2018) (considering lawsuits outside of California, but against entities with principal
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`places of business in California, “unequivocally tangential and decidedly inadequate to justify the
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`exercise of personal jurisdiction in this case”). Indeed, the Supreme Court has explained that “the
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`‘minimum contacts’ analysis looks to the defendant’s contacts with the forum State itself, not the
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`defendant’s contacts with persons who reside there.” See Walden, 571 U.S. at 285.
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`7 The Court notes that Plaintiff has not provided any support for the suggestion in its opposition
`that ZTE (TX), Inc. resides in California, other than a cite to the complaint in AGIS I. See Dkt.
`No. 59 at 15. The complaint in that case, however, alleges that ZTE (TX) is incorporated under
`the laws of Texas and has its principal place of business in Texas. See AGIS I, ECF No. 1 at ¶ 3.
`Thus, Defendant does not appear to have known ZTE (TX) was a California resident.
`9
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`Northern District of California
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`United States District Court
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`Case 4:18-cv-06185-HSG Document 114 Filed 09/12/19 Page 10 of 12
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`Plaintiff nevertheless suggests that filing an action against a California resident, albeit in
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`another jurisdiction, is tantamount to sending a cease-and-desist letter to an entity in the forum
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`state. See Dkt. No. 59 at 14. Even if the Court were to accept this analogy, Plaintiff’s cases do
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`not hold that such contacts satisfy “traditional notions of fair play and substantial justice” such that
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`personal jurisdiction is warranted. See New World Int’l, Inc. v. Ford Glob. Techs., LLC, 859 F.3d
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`1032, 1038 (Fed. Cir. 2017); Red Wing Shoe Co. v. Hockerson-Halberstadt, Inc., 148 F.3d 1355,
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`1360–61 (Fed. Cir. 1998). To the contrary, the Federal Circuit has explained that:
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`Principles of fair play and substantial justice afford a patentee
`sufficient latitude to inform others of its patent rights without
`subjecting itself to jurisdiction in a foreign forum. A patentee should
`not subject itself to personal jurisdiction in a forum solely by
`informing a party who happens to be located there of suspected
`infringement. Grounding personal jurisdiction on such contacts alone
`would not comport with principles of fairness.
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`Red Wing, 148 F.3d at 1360–61.
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`Second, Plaintiff cites to discovery efforts that Defendant conducted as part of these Texas
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`cases: subpoenaing documents from a third-party California corporation, and noticing depositions
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`of witnesses located in California. See, e.g., Dkt. No. 59-20, Ex. S; Dkt. No. 59-21, Ex. T. As an
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`initial matter, Plaintiff does not cite any authority finding such contacts sufficient to establish
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`personal jurisdiction. The Supreme Court has explained that contacts that are “‘random,’
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`‘fortuitous,’ or ‘attenuated’ . . . or [the result] of the unilateral activity of another party or a third
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`person,” are insufficient for purposes of the minimum contacts analysis. Burger King, 471 U.S. at
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`475 (quotations omitted); accord Red Wing, 148 F.3d at 1359 (Fed. Cir. 1998). The Court finds
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`that Defendant’s discovery efforts are the result of unilateral third-party activity, namely where
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`documents and witnesses that are related to these Eastern District of Texas infringement actions
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`may be located. Cf. Walden, 571 U.S. at 285.
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`Although acknowledging that these contacts may be insufficient on their own to establish
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`specific jurisdiction, see Dkt. No. 59 at 15–16, Plaintiff contends that when viewed collectively,
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`specific jurisdiction is nevertheless proper. The Court is not persuaded. Plaintiff’s two categories
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`of contacts appear to collapse into one: Defendant litigated actions against California-based
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`10
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`Northern District of California
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`United States District Court
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`Case 4:18-cv-06185-HSG Document 114 Filed 09/12/19 Page 11 of 12
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`companies. As explained above, the Court finds this ground for personal jurisdiction unavailing.
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`Thus, the Court does not find personal jurisdiction has been established under these circumstances.
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`iv.
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`Jurisdictional Discovery
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`The Court has broad discretion to permit jurisdictional discovery, which “should ordinarily
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`be granted where pertinent facts bearing on the question of jurisdiction are controverted or where a
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`more satisfactory showing of the facts is necessary.” Butcher’s Union Local No. 498 v. SDC
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`Investment, Inc., 788 F.2d 535, 540 (9th Cir. 1986) (quotation omitted). Nevertheless, the Court
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`may deny jurisdictional discovery if “it is clear that further discovery would not demonstrate facts
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`sufficient to constitute a basis for jurisdiction,” Wells Fargo & Co. v. Wells Fargo Express Co.,
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`556 F.2d 406, 430 n.24 (9th Cir. 1977), or when the request is “based on little more than a hunch
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`that it might yield jurisdictionally relevant facts,” Boschetto v. Hansing, 539 F.3d 1011, 1020 (9th
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`Cir. 2008).
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`The Court finds that additional discovery may yield relevant jurisdictional facts. The
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`Court finds that Plaintiff has raised enough of a question regarding whether Defendant is a sham
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`entity such that AGIS Inc.’s contacts with California should be imputed to Defendant for purposes
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`of jurisdiction to warrant further discovery. Accordingly, the Court exercises its discretion and
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`GRANTS Plaintiff’s request to conduct jurisdictional discovery. Because the Court does not
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`intend to indefinitely delay this action, Plaintiff shall have one month to conduct targeted
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`discovery to support personal jurisdiction, consistent with this order. The Court therefore SETS
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`October 14, 2019, as the jurisdictional discovery cut-off.
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`B.
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`Sanctions
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`In connection with its motion to dismiss, Defendant has also filed a motion for sanctions
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`against Plaintiff for filing this suit in the Northern District of California. See Dkt. No. 48.
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`Sanctions under Federal Rule of Civil Procedure 11 are appropriate when an attorney has certified
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`“claims . . . [not] warranted by existing law or by a nonfrivolous argument for the extension,
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`modification, or reversal of existing law or the establishment of new law.” Fed. R. Civ. P.
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`11(b)(2). Although the Court has concluded as part of this order that Plaintiff has not yet alleged
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`sufficient facts to support personal jurisdiction, the Court notes that personal jurisdiction is a
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`11
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`Northern District of California
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`United States District Court
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`
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`Case 4:18-cv-06185-HSG Document 114 Filed 09/12/19 Page 12 of 12
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`highly fact-intensive inquiry. The Court is not persuaded that Plaintiff’s claims are frivolous, and
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`thus DENIES the motion for sanctions.
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`IV. CONCLUSION
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`Accordingly, the Court DENIES WITHOUT PREJUDICE the motion to dismiss and
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`DENIES the motion for sanctions. The Court also DENIES Plaintiff’s pending motion to
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`supplement the record, but will permit limited jurisdictional discovery. The Court SETS October
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`14, 2019, as the jurisdictional discovery cut-off, and further SETS a case management conference
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`on October 22, 2019, at 2:00 p.m.
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`IT IS SO ORDERED.
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`Dated:
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`______________________________________
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`HAYWOOD S. GILLIAM, JR.
`United States District Judge
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`Northern District of California
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`United States District Court
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`9/12/2019
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`