There are many things to love about Delaware. There's the majestic beauty of the Brandywine. The excitement of tax-free shopping. The award-winning mollusk collection at the natural history museum. The easy train access to other cities with more than 6 restaurants. It is truly a special place.
All this is to say that, if I was to sue someone, I'd want to do it in Delaware. Sadly, that's not always possible.
Such is the lesson of ACCO Brands USA LLC v. Performance Designed Products LLC, C.A. No 23-437-GBW, D.I. 18 (D. Del. Jan. 17, 2024). ACCO was a downhome Delaware company (*cough* headquartered in Illinois *cough*). So when they got a letter accusing them of infringing PDB's patents, they sued for declaratory judgment of non-infringement in the greatest District mankind has yet encountered.
That's Delaware.
PDB, the patentee, was a California company. So they moved to dismiss for lack of jurisdiction and improper venue. ACCO countered that:
- PDB sold its products embodying the patents in Delaware,
- PDB directed their enforcement efforts - including a letter and several firm zoom calls -- at a Delaware corporation (ACCO), and
- HAVE YOU SEEN THESE MOLLUSKS?!
Judge Williams, however, found these counterpoints unpersuasive. As to the first:
[T]he Federal Circuit has made clear that a declaratory judgment claim "neither directly arises out of nor relates to the making, using, offering to sell, selling, or importing of arguably infringing products in the forum, but instead arises out of or relates to the activities of the defendant patentee in enforcing the patent or patents in suit." Thus, the relevant inquiry in determining specific personal jurisdiction in a declaratory judgment action is "to what extent ... the defendant patentee purposefully directed such enforcement activities at residents of the forum, and the extent to which the declaratory judgment claim arises out of or relates to those activities."
Id. at 5 (internal citations omitted).
This leads directly to point two above, which Judge Williams also found unpersuasive:
Plaintiff ACCO has not shown that PDP has participated in "other activities" such that it could anticipate being brought to court in Delaware. The notice letter was sent to ACCO's Senior Vice President, Eric Bensussen, at his Washington State address. And the Federal Circuit has consistently held that "warning letters from [ ] an out-of-state patentee cannot, without more, support personal jurisdiction in an action for a declaratory judgment of patent invalidity and non infringement." . . . the Court is not swayed by the argument that a few virtual meetings to discuss settlement, which ultimately failed to end in agreement or collaboration, amount to "additional activity," but instead could be categorized as an extension of seeking settlement out of court
Id. at 6 (internal citations omitted).
The Court did not specifically address the Mollusk issue.
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