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New World International, Inc. v. Ford Global Technologies, LLC

Exclusive License with In-Forum Entity Insufficient, Without More, to Establish Specific Personal Jurisdiction Over Patentee

New World International, Inc. v. Ford Global Technologies, LLC, (Fed. Cir. June 8, 2017) (Prost, BRYSON, Wallach) (N.D. Tex.: Lynn) (3 of 5 stars)

Fed Cir affirms dismissal of declaratory judgment complaint for lack of personal jurisdiction. The district court correctly determined that, per Breckenridge, 444 F.3d 1356 (Fed. Cir. 2006), the mere existence of an exclusive license of certain FGTL design patents between FGTL and a company doing business in Texas (“LKQ”) was insufficient to establish personal jurisdiction over FGTL in Texas. The district court also correctly determined that FGTL’s obligation to indemnify LKQ in certain circumstances was insufficient to establish specific personal jurisdiction. Genetic Implant, 123 F.3d 1455 (Fed. Cir. 1997), is not contrary because that case merely noted the presence of an indemnity obligation, but did not rely on such an obligation to find personal jurisdiction. Further, the indemnity agreement required FGTL to indemnify LKQ for claims alleging infringement of the patents of others, and had nothing to do with FGTL’s design patents (which were at issue). The district court also correctly determined that New World had failed to demonstrate that FGTL’s sending of cease-and-desist letters was coordinated in any way with LKQ. The case was thus further distinguishable from Breckenridge (in which there was demonstrated coordination between the licensee and the licensor as to patent enforcement). Taking all evidence into consideration, the license between FGTL and LKQ did not “impose a sufficient obligation on the patent holder [FGTL] regarding the enforcement of the patent rights to subject the patent holder to specific jurisdiction [in Texas].” Op. at 18.

The district court also did not abuse its discretion in denying New World’s motion to amend its complaint post-dismissal to add new allegations in support of personal jurisdiction over FGTL. New World’s desire to “buttress its jurisdictional presentation” was insufficient to overcome the district court’s discretion, particularly as New World maintained that it “had done enough previously to avoid dismissal.” Op. at 19–20. Notably, New World had not alleged the discovery of any new evidence.

KEYWORDS: PERSONAL JURISDICTION (NO); DECLARATORY JUDGMENT, NEW WORLD INTERNATIONAL, INC.; FORD GLOBAL TECHNOLOGIES, LLC