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Creative Controls' alleged copying of photographs from Kindig's website is unrelated to the patent claims, as is Creative Controls' alleged donation the parking brake. Furthermore, as explained below, the parties agree that the single sale made to a Utah resident should be ignored for the jurisdictional analysis. In support of its motion to dismiss for lack of personal jurisdiction, Creative Controls offers an affidavit by its president detailing its lack of contacts with Utah. It has never maintained a regular or established place of business in Utah. It is not registered to do business in Utah, and has no employees in Utah.
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These lawsuits allege that the companies are infringing on the copyrights and patents of custom car shops by selling products that are similar to the shops’ products. Kindig has fourteen causes of action against Creative Controls. Claims 1, 2, 7, 12, 13, and 14 are the patent-related claims. These claims are wholly unrelated to Creative Controls' alleged copying of Kindig's website. Claim 11 is for business disparagement based on statements made at a trade conference in Las Vegas, Nevada.
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1) Creative Controls' website does not constitute purposeful availment of the Utah forum. We can sometimes provide need-based exceptions to these rules. In this part, we’ll explore the resolution of the lawsuit and its consequences for Kindig It Design, their reputation, and the future of the “Bitchin’ Rides” show. As Creative Controls stated, their website was not made mainly to attract clients from a specific location.
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While the court has specific personal jurisdiction over all the remaining claims, Kindig did not adequately plead claim 9 for fraud. Accordingly, Creative Controls' Motion to Dismiss is GRANTED IN PART AND DENIED IN PART and claims 1, 2, 7, 9, 11, 12, 13, and 14 are dismissed. Creative Controls argues that Kindig's unjust enrichment and conversion claims (claims 8 and 10) are preempted by federal copyright law. In so doing, it relies on the Tenth Circuit case of Ehat v. Tanner .
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At the motion to dismiss stage, Kindig need only provide factual allegations that, taken as true, indicate that Creative Controls made an offer to sell to a resident of Utah other than in the sale orchestrated by Kindig. Even viewing all well-pleaded facts in the light most favorable to Kindig, it has not satisfied its minimal burden in this regard. Under Kindig's view, every court in every state could exercise personal jurisdiction over Creative Controls simply because it maintains an interactive website. Were the court to adopt such an approach, “then the defense of personal jurisdiction, in the sense that a State has geographically limited judicial power, would no longer exist.” ALS Scan, Inc. v. Dig.
III. Kindig Has Stated a Claim Under Rule 12 For All Copyright-Related Claims Except for the Fraud Claim
Kindig alleges that Creative Controls copied the photographs from Kindig's website and used them to illegally create infringing websites and other derivative works. Kindig argues that Creative Controls purposefully availed itself of the Utah forum by illegally copying the materials from Kindig's website in Utah. Given the exponential growth in the number of interactive websites, the Zippo approach—which would remove personal jurisdiction's geographical limitations based on the mere existence of those those websites—is particularly troubling. And the problem would grow more acute every year as more individuals and businesses create interactive websites. The court recognizes that one possible way to distinguish the Facebook activities from the Zippo test is that Zippo referred to commercial activity and most individual social media pages are not maintained for commercial purposes.
Creative Controls sent the brake to Kindig's place of business in Utah. In return, Kindig sent Creative Controls a disk containing photographs of the finished car. Accompanying the disk was a letter from Kindig indicating that Creative Controls could use the photographs for promotional purposes. The photographs on the disk are among the copyrighted photographs that Kindig alleges Creative Controls illegally copied. Despite the lateness of its motion to compel, Kindig-It makes no attempt to modify the scheduling order for good cause.
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Nor can the court discern good cause given that the responses to the discovery request were given 51 days before the close of fact discovery. Kindig-It had time to either file a motion to compel or request to extend the discovery deadline before it passed. Moreover, the fact that the parties may have been negotiating a settlement does not give them license to ignore deadlines without seeking permission of the court. A private agreement between the parties that "any discovery requests will be extended" does not extend the discovery cutoff. Rule 16(b)(4) unambiguously provides that a scheduling order "may be modified only for good cause and with the judge's consent." The outcome of these lawsuits could have a significant impact on the custom car industry.
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So, they marketed and targeted their website for everyone who could access it. Whereas Creative Controls defended themselves, saying that the Kindig team had permitted them to use the pictures through a letter in exchange for a custom parking brake they donated to King-It Designs. According to an online report, Kindig-It Design filed a case against Creative Controls in 2015.
In doing so, it relies heavily on the “sliding scale” framework outlined in a 1997 federal district court decision, Zippo Mfg. Under this framework, active websites, which facilitate internet transactions by the repeated and knowing transmission of files, nearly always establish the minimum contacts necessary for jurisdiction. But “passive Web sites,” which do little more than provide information, do not. For “interactive Web sites,” which fall in the middle of the scale, jurisdiction depends on the “level of interactivity and commercial nature of the exchange of information that occurs on the Web site.” Id. But the Zippo sliding scale framework has never been adopted by the Federal Circuit. In fact, there is considerable uncertainty in the Federal Circuit, as in many others, as to how internet contacts and websites should be treated when evaluating personal jurisdiction.
Creative Controls moves to dismiss on the basis that the court lacks personal jurisdiction over it. Alternatively, Creative Controls moves to transfer the case to Michigan and to dismiss various causes of action under Rule 12(b)(6) for failing to state a claim. The court held a hearing on the motion on September 24, 2015. Due to inadequacies in the briefing, the court requested additional memoranda from both parties, which were filed on October 12, 2015. Creative Controls argues that “[i]t would be a significant burden on Creative Controls to have to defend the lawsuit in Utah while Creative Controls is located in Michigan.” It does not, however, explain why this would the case. In the modern world of air transportation and digital communication, the court has no difficulty in finding that litigating in Utah will not create so substantial a burden to Creative Controls as to violate Due Process.
Grp., Inc. v. GPS Indus., Inc. , 645 F.Supp.2d 1130, 1138–42 (S.D.Fla.2009) (citing numerous divergent cases across various circuits). Accordingly, the court must first determine whether to apply the Zippo sliding scale framework in this case. Under both Federal Circuit and Tenth Circuit law, the plaintiff bears the initial burden of establishing personal jurisdiction. See Shrader , 633 F.3d at 1239 (explaining the burden); Elecs.
