United States District Court, D. New Jersey
WILLIAM J. MARTINI, U.S.D.J.
InvenTel Products, LLC's ("InvenTel" or
"Plaintiff) brings this action for various direct and
contributory violations of its intellectual property rights.
The matter comes before the Court on Defendant Google
LLC's ("Google") motion to compel arbitration,
dismiss, or transfer the case to the Northern District of
California, ECF No. 43, and Defendants Shopify Inc. and
Shopify (USA) Inc.'s ("Shopify") motion to
dismiss, ECF No. 53. For the reasons set forth below, the
motions are GRANTED IN PART and
DENIED IN PART.
sells a variety of consumer products in the United States via
mail-order and online sales, including the HD MIRROR CAM®
("HD MIRROR CAM"). The HD MIRROR CAM is a security
camera for automobiles. InvenTel holds patents, copyrights,
and trademarks on HD MIRROR CAM technology and marketing
Jimmy Li, Lin Amy, and Wu Jinzhao ("Li Defendants")
allegedly produce counterfeit HD MIRROR CAMs
("Counterfeit Products") in China and market them
to U.S. customers online. The online sale of the Counterfeit
Products is the subject of a related action ("Prior
Action") brought by InvenTel against the Li Defendants,
Google, Shopify, GoDaddy, and others (collectively,
"Defendants"). See InvenTel Products, LLC v.
voluntarily dismissing Google from the Prior Action, InvenTel
learned of a new website created by the Li Defendants to
further market the Counterfeit Products:
www.hdmirrorcambuy.com ("Website"). On April 2,
2019, InvenTel initiated this suit alleging similar acts of
infringement to the Prior Action but occurring on the new
Website. On June 17, InvenTel dismissed the Prior Action
matter, InvenTel alleges that it "duly notified Google
regarding the infringement by the Li Defendants" but
"despite such notice .. . Google has permitted and
continues to permit the Li Defendants" to use
Google's advertisement services called
"Adworks". Compl. ¶¶ 88-89, ECF No. 1.
Other than notice through the Prior Action and settlement
negotiations thereof, however, the Complaint does not specify
how or when InvenTel notified Google of any infringement, or
whether such notice related to the new Website. See
Id. ¶¶ 91-95. The Complaint does quote the
Website's claim that "[w]e use Google Analytics to
help us understand how our customers use the Site - you can
read more about how Google uses your Personal Information
here." Id. ¶ 96 (linking to Google's
Shopify, InvenTel makes general allegations about
Shopify's business model and inadequate trademark
infringement policy. Id. ¶¶ 54-66. With
respect to the infringement at issue here, InvenTel alleges
Shopify "hosts and/or has hosted some of the"
websites used by the Li Defendants to sell Counterfeit
Products. Id. ¶ 67. Thus, Shopify
"facilitates sales" of the infringing products.
Id. ¶ 68. Inventel alleges it notified Shopify
of the Li Defendants' infringement in October 2018, via
the Prior Action, and in settlement discussions, but Shopify
continues to facilitate the Li Defendants' sales.
Id. ¶69-71. Finally, the Complaint quotes
language from the Website stating that "we use Shopify
to power our online store" and referencing a Shopify
website. Id. ¶ 73.
April 16, 2019, the Court entered an order temporarily
restraining Defendants from infringing on InvenTel's
intellectual property rights. See Order, ECF No. 6
("TRO"). After Google, GoDaddy, and Shopify
submitted briefing and supporting material, the Court
terminated the TRO and denied InvenTel's motion for a
preliminary injunction. Op. & Order, ECF Nos. 18-19,
29-30. Now before the Court is Google's motion to compel
arbitration, transfer, or dismiss, ECF No. 43, and
Shopify's motion to dismiss pursuant to Federal Rule of
Civil Procedure ("FRCP") 12(b)(2) and 12(b)(6), ECF
argues (A) it is not subject to the Court's personal
jurisdiction while (B) Google argues this matter should be
dismissed because the parties agreed to arbitrate or litigate
in a different forum. Alternatively, both Google and Shopify
argue (C) that Plaintiff fails to state a claim upon which
relief can be granted. Each argument is taken in turn below.
Personal Jurisdiction Over Shopify
argues it is not subject to the personal jurisdiction of this
Court. Shopify Br. at 6-11, ECF No. 53-2. Specifically,
Shopify argues (1) it is not subject to General Jurisdiction
in New Jersey, (2) it has no actual involvement with the
Website at issue, and (3) even crediting the allegations of
involvement, the Court lacks specific jurisdiction.
argues because it is not incorporated in New Jersey, does not
have a principle place of business in New Jersey, and has no
offices in New Jersey, it is not subject to general
jurisdiction in New Jersey. Shipify Br. at 7. In response,
"Inventel declines to address the issue of General
Jurisdiction at this time, but reserves the right to seek
Discovery into the extent of Shopify's affiliations
within the State of New Jersey if the Court declines to find
[s]pecific [j]urisdiction." InvenTel Opp. to Shopify at
13 n.2, ECF No. 58.
response is insufficient. A party may not "decline to
address the issue" to avoid the consequences of an
argument. Id.; see, e.g., Alpine Bus. Grp., Inc. v.
Sabathia, 10-cv-4850, 2011 WL 589959, at *2 (D.N.J. Feb.
10, 2011) ("An unsupported position is considered waived
or abandoned."). The allegations in the Complaint
confirm Shopify's place of incorporation and business.
Compl. ¶¶ 7-8. Nothing in the Complaint sets forth
a basis for finding general jurisdiction exists, including
the allegation that Shopify regularly conducts business
throughout the United States. Compare Compl.
¶¶7-8, with Daimler AG v. Bauman, 571 U.S.
117, 139 (2014) (rinding no general jurisdiction despite
sizable sales in California). Thus, the Court need not
provide discovery, as requested by InvenTel. InvenTel Opp. to
Shopify at 13 n.2; Toys "R" Us, Inc. v. Step
Two, S.A., 318 F.3d446, 456 (3d Cir. 2003) ("If
a plaintiff presents factual allegations that suggest..
. the possible existence of the requisite contacts between
the party and the forum state, the plaintiffs right to
conduct jurisdictional discovery should be sustained."
(emphasis added) (cleaned up)).
challenges the Court's specific jurisdiction based on
both (a) outside evidence and (b) accepting the allegations
in the Complaint. Shopify Br. at 8-11.
deciding Rule 12(b)(2) motions, "[i]f the district court
does not hold an evidentiary hearing, the plaintiffs need
only establish a prima facie case of personal jurisdiction.
Moreover, it is well established that in deciding a motion to
dismiss for lack of jurisdiction, a court is required to
accept the plaintiffs allegations as true, and is to construe
disputed facts in favor of the plaintiff." Metcalfe
v. Renaissance Marine, Inc., 566 F.3d 324, 330 (3d Cir.
the Court has not held an evidentiary hearing. While Shopify
encourages the Court to take judicial notice of its previous
factual finding, it would be improper to credit
Defendant's Counsel's word over the allegations in
the Complaint without holding a hearing and providing for
very limited discovery. See id.; see also Toys
"R" Us, Inc., 318 F.3d at 456 (mandating
jurisdictional discovery once prima facie showing of
jurisdiction made). However, because InvenTel fails to make
the threshold showing of prima facie jurisdiction, discovery
and a hearing are unnecessary. See Toys "R" Us,
Inc., 318 F.3d at 456.
Accepting the Allegations
only substantive allegations against Shopify relating to the
alleged infringement are that Shopify (1) "hosts and/or
has hosted some of the Li websites which, as discussed above,
were used to advertise, market and sell products in the
United States and specifically in New Jersey"; (2)
"facilitates sales in the United States and specifically
in New Jersey"; (3) failed to stop infringing ...