Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_06-cv-03450/USCOURTS-cand-5_06-cv-03450-2/pdf.json

Nature of Suit Code: 840
Nature of Suit: Trademark
Cause of Action: 15:1121 Trademark Infringement

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Case No. C 06-3450 JF (RS)

ORDER (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION TO DISMISS ETC.

(JFLC2)

**E-Filed 8/16/06**

NOT FOR CITATION

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

CLARUS TRANSPHASE SCIENTIFIC, INC.,

 Plaintiff,

 v.

Q-RAY, INC., et al.,

 Defendants.

Case Number C 06-3450 JF (RS)

ORDER (1) GRANTING IN PART

AND DENYING IN PART

DEFENDANTS’ MOTION TO

DISMISS; AND (2) GRANTING

MOTION TO TRANSFER VENUE TO

THE NORTHERN DISTRICT OF

ILLINOIS

[Doc. No. 7]

Defendants Q-Ray, Inc. (“Q-Ray”), QT, Inc. (“QT”), Bio-Ray, Inc. (“Bio-Ray”), BioMetal, Inc. (“Bio-Metal”), Que Te “Andrew” Park (“Park”) and Jung Joo Park (“Jung Joo Park”)

move to dismiss the complaint of Plaintiff Clarus Transphase Scientific, Inc. (“Clarus”) for lack

of personal jurisdiction and improper venue. Alternatively, Defendants move to transfer venue to

the Northern District of Illinois. The Court has considered the parties’ briefing as well as the oral

arguments presented at the hearing on August 11, 2006. For the reasons discussed below, the

motion to dismiss will be granted as to Defendants Q-Ray, Bio-Ray, Bio-Metal, Jung Joo Park

and Andrew Park, and denied as to QT. Because allowing the action to proceed in a forum in

Case 5:06-cv-03450-JF Document 57 Filed 08/16/06 Page 1 of 10
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 The “complaint” electronically filed on the Court’s docket consists only of exhibits; it

appears that the substantive complaint was erroneously omitted. Plaintiffs are directed to cure

this filing error as soon as is practicable.

2

 Clarus filed a motion for preliminary injunction on the following day, July 7, 2006. 

That motion has been set for hearing on September 8, 2006.

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Case No. C 06-3450 JF (RS)

ORDER (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION TO DISMISS ETC.

(JFLC2)

which all defendants are subject to personal jurisdiction will serve the interests of judicial

economy, the motion to transfer venue will be granted.

I. BACKGROUND

Clarus owns trademark and trade dress rights in the “Q-Link” ionized pendant, a jewelry

item that is worn around the neck. Clarus filed the instant action on May 26, 2006, alleging that

Park, its former licensee, has begun selling a “knock-off” pendant called the “Q-Ray” ionized

pendant through his company QT.1 Clarus asserts trade dress and related claims against Park, his

wife Jung Joo Park, QT, and other corporate entities. 

All of the corporate defendants were incorporated in Illinois and have their principal

places of business there. The Parks are residents of Illinois. On July 6, 2006, Defendants filed a

joint motion to dismiss the instant action for lack of personal jurisdiction and improper venue or,

alternatively, to transfer venue to the Northern District of Illinois.2

On July 21, 2006, Clarus filed opposition to Defendants’ motion, conceding lack of

jurisdiction as to Q-Ray, Bio-Ray, Bio-Metal and Jung Joo Park, but asserting that personal

jurisdiction does exist with respect to QT and Park. The Court granted leave to conduct limited

discovery into the question of personal jurisdiction and set the motion for hearing on August 11,

2006. Both sides filed supplemental briefs on August 9, 2006.

II. MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION

A. Legal Standard

A district court sitting in California may exercise personal jurisdiction over a non-resident

defendant if the defendant has “minimum contacts” with California such that maintenance of the

suit “does not offend traditional notions of fair play and substantial justice.” Data Disc, Inc. v.

Systems Technology Associates, Inc., 557 F.2d 1280, 1286 (9th Cir. 1977); see also International

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Case No. C 06-3450 JF (RS)

ORDER (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION TO DISMISS ETC.

(JFLC2)

Shoe Co. v. Washington, 326 U.S. 310, 316 (1945).

If the nonresident defendant’s contacts with California are “substantial” or “continuous

and systematic,” the defendant is subject to “general jurisdiction” in California even if the cause

of action is not related to the defendant’s activities within the state. Data Disc, 557 F.2d at 1287. 

“The standard for establishing general jurisdiction is fairly high, and requires that the defendant’s

contacts be of the sort that approximate physical presence.” Bancroft & Master, Inc. v. August

Nat’l Inc., 223 F.3d 1082, 1086 (9th Cir. 2000) (internal quotation marks and citations omitted). 

“Factors to be taken into consideration are whether the defendant makes sales, solicits or engages

in business in the state, serves the state’s markets, designates an agent for service of process,

holds a license, or is incorporated there.” Id. 

If the defendant’s activities within the state are not so pervasive as to subject it to general

jurisdiction, it may be subject to “specific jurisdiction” if the cause of action is directly related to

those activities. Data Disc, 557 F.2d at 1287. The Ninth Circuit has articulated a three-part test

to determine when it is appropriate to exercise specific jurisdiction over a particular defendant: 

(1) the nonresident defendant has performed some act by which he purposefully avails himself of

the privilege of conducting activities in the forum, thereby invoking the benefits and protections

of its laws; (2) the claim arises out of or results from the defendant’s forum-related activities; and

(3) exercise of jurisdiction is reasonable. Id. 

When a nonresident defendant raises a challenge to personal jurisdiction, the plaintiff

bears the burden of showing that jurisdiction is proper. Decker Coal Co. v. Commonwealth

Edison Co., 805 F.2d 834, 839 (9th Cir. 1986). In the context of a motion to dismiss based upon

pleadings and affidavits, the plaintiff may meet this burden by making a prima facie showing of

personal jurisdiction. Metropolitan Life Ins. v. Neaves, 912 F.2d 1062, 1064 n.1 (9th Cir. 1990);

Data Disc, 557 F.2d at 1285. In determining whether the plaintiff has made a prima facie

showing, documents submitted by the plaintiff are construed in the light most favorable to the

plaintiff and all doubts are resolved in the plaintiff’s favor. Metropolitan Life, 912 F.2d at 1064

n.1.

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Case No. C 06-3450 JF (RS)

ORDER (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION TO DISMISS ETC.

(JFLC2)

B. QT

Clarus introduces evidence that QT maintains an interactive website selling its jewelry

products (primarily Q-Ray ionized bracelets) in a “virtual store” that is accessible to California

residents; advertises nationally on television and in magazines; has sent approximately 125,000

direct marketing emails to California residents in 2006; has sent approximately 62,000 direct

mail solicitations to California residents in 2006; and has sent more than 500 Q-Ray catalogs into

California. Clarus also introduces evidence that QT uses a California based company, Euro

RSCG of Carlsbad, in relation to its nationally televised infomercials; that QT has had sales

representatives in California in the past; and that QT maintained a “fulfillment” center in

California for part of 2000 and filed a California tax return in 2000. Finally, Clarus introduces

evidence that QT has more than 100,000 retail customers in California and more than 100

wholesale customers in California. QT’s retail sales into California exceed $4 million for the last

three years; its wholesale sales into California total approximately $100,000. Based upon this

evidence, the Court has no difficulty finding that it has general jurisdiction over QT.

QT nonetheless cites Bancroft & Master for the proposition that general jurisdiction is

not present. In that case, the California owner of the Internet domain name “masters.com”

brought action against a Georgia golf club that owned the “Masters” trademark, seeking

declaratory judgment of non-infringement of the mark and other relief. The Ninth Circuit held

that the golf club’s contacts with California were insufficient to establish general jurisdiction. 

However, the court’s finding was based upon its conclusion that the golf club’s website was

passive and that the golf club did not target any advertising toward California. The court

concluded that the golf club’s “occasional, unsolicited sales of tournament tickets and

merchandise to California residents are insufficient to create general jurisdiction.” Bancroft &

Master, 223 F.3d at 1086. This reasoning is inapplicable in the instant case. Clarus has

presented evidence that QT maintains an active website, aggressively targets advertising toward

California, and sells products worth hundreds of thousands of dollars to California residents

California annually. 

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Case No. C 06-3450 JF (RS)

ORDER (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION TO DISMISS ETC.

(JFLC2)

C. Park

“Under the fiduciary shield doctrine, a person’s mere association with a corporation that

causes injury in the forum state is not sufficient in itself to permit that forum to assert personal

jurisdiction over the person.” Davis v. Metro Productions, Inc., 885 F.2d 515, 520 (9th Cir.

1989); see also Colt Studio, Inc. v. Badpuppy Enterprise, 75 F.Supp.2d 1104, 1111 (C.D. Cal.

1999) (“The mere fact that a corporation is subject to local jurisdiction does not necessarily mean

its nonresident officers, directors, agents, and employees are suable locally as well”). “For

jurisdictional purposes, the acts of corporate officers and directors in their official capacities are

the acts of the corporation exclusively and are thus not material for purposes of establishing

minimum contacts as to the individuals.” Colt Studio, 75 F.Supp.2d at 1111. However, “[i]f the

corporation is the ‘alter ego’ of the individual defendants so as to justify disregard of the

corporate entity, then a finding of personal jurisdiction over the corporation will support a

finding of personal jurisdiction over the individuals.” Id.; see also Davis, 885 F.2d at 520. 

Alternatively, personal jurisdiction over the individual may be found based upon “the

individual’s control of, and direct participation in the alleged activities” of the corporation. Wolf

Designs, Inc. v. DHR & Co., 322 F.Supp.2d 1065 (C.D. Cal. 2004); see also Smith + Noble LLC

v. South Jersey Vinyl, Inc., 47 U.S.P.Q.2d 1944, 1946-47 (1998).

Clarus argues that Park is subject to the specific jurisdiction of this Court because Park

controlled and directly participated in the activities that give rise to jurisdiction over QT. As

discussed above, QT is subject to the general jurisdiction of this Court based upon its substantial

and continuous contacts with California unrelated to the Q-Ray ionized pendant at issue in this

lawsuit. Clarus does not cite any authority for the proposition that the Court can look through

these general activities of QT to find general jurisdiction over Park. Instead, Clarus argues that

in addition to being subject to general jurisdiction, QT is subject to the specific jurisdiction of

this Court as a result of QT’s contacts with California relating to the Q-Ray ionized pendant, and

that the Court can look through these contacts to find specific jurisdiction over Park based upon

his control and participation.

Although as discussed above this Court’s general jurisdiction over QT is not a difficult

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 Clarus’ counsel ordered an additional pendant from QT as well. A plaintiff cannot

manufacture personal jurisdiction in a trademark case by purchasing the accused product in the

forum state. Millennium Enterprises, Inc. v. Millennium Music LP, 33 F.Supp.2d 907, 911 (D.

Ro. 1999). 

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Case No. C 06-3450 JF (RS)

ORDER (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION TO DISMISS ETC.

(JFLC2)

one, the question of whether QT also is subject to the specific jurisdiction of this Court is very

close. As noted above, in attempting to determine the existence of specific jurisdiction over a

particular defendant the Court asks whether: (1) the nonresident defendant has performed some

act by which he purposefully avails himself of the privilege of conducting activities in the forum,

thereby invoking the benefits and protections of its laws; (2) the claim arises out of or results

from the defendant’s forum-related activities; and (3) exercise of jurisdiction is reasonable. See

Data Disc, 557 F.2d at 1287. While there is evidence that QT advertises its Q-Ray

bracelet products extensively in California, the record is quite unclear as to how extensively QT

advertises the Q-Ray pendant in California. While QT has sold its line of ionized bracelets for

years, it did not begin selling the ionized pendant until approximately the same time the instant

lawsuit was filed on May 26, 2006. See Decl. of Charles Park, ¶ 11 (stating that the Q-Ray

ionized pendant was not offered for sale until June 2006). QT had not sold any Q-Ray ionized

pendants in California at the time the suit was filed. There is evidence that QT subsequently

made a single sale of four pendants to a California resident after the suit was filed,3 and that three

other California residents ordered pendants that QT has not shipped because they are backordered.

The Court has serious reservations as to whether QT’s advertising and sales of the Q-Ray

ionized pendant in California are sufficient to meet the “purposeful availment” prong. Moreover,

there is little or no evidence that Clarus’ claims arise out of QT’s advertising and sales of the

pendant in California, because the only California sales appearing in the record occurred after

Clarus filed this action. However, even assuming without deciding that the first two prongs of

the test are met, the Court concludes that exercise of personal jurisdiction over Park would be

unreasonable. While there is evidence that Park, as the CEO and sole shareholder of QT,

ultimately approved the design and marketing of the subject pendant, there is no evidence that he

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Case No. C 06-3450 JF (RS)

ORDER (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION TO DISMISS ETC.

(JFLC2)

had any personal involvement in the advertising of that pendant (if any) in California, or that he

was involved in the single California sale that has occurred. Under these circumstances, given

Park’s residency in Illinois and lack of any meaningful contacts with California, the Court

declines to assert personal jurisdiction over Park. 

III. MOTION TO DISMISS FOR IMPROPER VENUE

A civil action in which subject matter jurisdiction is based in part upon a federal question

may be “brought only in (1) a judicial district where any defendant resides, if all defendants

reside in the same State, (2) a judicial district in which a substantial part of the events or

omissions giving rise to the claim occurred, or a substantial part of property that is the subject of

the action is situated, or (3) a judicial district in which any defendant may be found, if there is no

district in which the action may otherwise be brought.” 28 U.S.C. § 1391(b). For purposes of

venue, a corporate defendant is deemed to reside in any judicial district in which it is subject to

personal jurisdiction. 28 U.S.C. § 1391(c). 

Defendants assert that venue is improper in California because Defendants are not subject

to personal jurisdiction in California. As discussed above, the Court concludes that jurisdiction

is proper with respect to QT. Moreover, Defendants do not address subsection (2) of § 1391(b),

providing that venue is proper in a judicial district in which a substantial part of the events giving

rise to the claim occurred. Plaintiffs assert sales of the alleged knock-off pendant in California. 

Accordingly, Defendants have failed to demonstrate that venue in this district is improper.

IV. MOTION TO TRANSFER

Defendants’ alternative motion to transfer venue to the Northern District of Illinois is

governed by 28 U.S.C. § 1404(a), which provides as follows: 

(a) For the convenience of parties and witnesses, in the interest of justice, a

district court may transfer any civil action to any other district or division where it

might have been brought.

28 U.S.C. § 1404(a). This action might have been brought in the Northern District of Illinois

because all defendants reside in Illinois. See 28 U.S.C. § 1391(b).

Ordinarily, a plaintiff’s choice of forum is accorded substantial weight, and courts will

not grant a motion under § 1404(a) unless the “convenience” and “justice” factors tip strongly in

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Case No. C 06-3450 JF (RS)

ORDER (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION TO DISMISS ETC.

(JFLC2)

favor of transfer. Florens Container v. Cho Yang Shipping, 245 F.Supp.2d 1086, 1092 (N.D.

Cal. 2002); see also Piper Aircraft Co. v. Reyno, 454 U.S. 235, 257 (1981); Decker Coal Co. v.

Commonwealth Edison Co., 805 F.2d 834, 843 (9th Cir. 1986). However, the Court may

disregard the plaintiff’s choice of forum where the plaintiff’s suit is the result of forum-shopping. 

Alltrade. Inc., v. Uniweld Products, Inc., 946 F.2d 622, 628 (9th Cir. 1991). 

A motion for transfer pursuant to § 1404(a) lies within the discretion of the Court. Jones

v. GNC Franchising, Inc., 211 F.3d 495, 498 (9th Cir. 2000). The decision whether to grant such

a motion turns on the facts of the particular case. Id. The factors to be weighed in deciding a

motion for transfer include: (1) the location where the relevant agreements were negotiated and

executed; (2) the state that is most familiar with the governing law; (3) the plaintiff’s choice of

forum; (4) the respective parties’ contacts with the forum; (5) the contacts relating to the

plaintiff’s cause of action in the chosen forum; (6) the differences in the costs of litigation in the

two forums; (7) the availability of compulsory process to compel attendance of unwilling

non-party witnesses; (8) the ease of access to sources of proof; (9) the presence of a forum

selection clause; and (10) that the relevant public policy of the forum state, if any. Id. at 498-99.

Many of these factors are inapplicable to the instant case. Clearly, Clarus’ choice of

forum must be accorded significant weight. However, balanced against that choice is the Court’s

determination that it cannot exercise personal jurisdiction over Park. Clarus’ counsel made clear

at the hearing that Clarus wishes to pursue this action against both QT and Park. Because Park

cannot be sued in California, and because all the documentary evidence pertaining to the

development, marketing and sales of the Q-Ray ionized pendant are located in Illinois, the Court

concludes that Illinois is a superior forum for litigation of this action and that transfer to that

forum will best serve the interests of judicial economy. Accordingly, the Court will grant

Defendants’ motion to transfer venue to the Northern District of Illinois.

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Case No. C 06-3450 JF (RS)

ORDER (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION TO DISMISS ETC.

(JFLC2)

V. ORDER

(1) Defendants’ motion to dismiss for lack of personal jurisdiction is GRANTED as

to Defendants Q-Ray, Bio-Ray, Bio-Metal, Jung Joo Park and Andrew Park, and

DENIED as to Defendant QT; 

(2) Defendants’ motion to dismiss for improper venue is DENIED;

(3) Defendants’ motion to transfer venue to the Northern District of Illinois is

GRANTED; and

(4) The Clerk of the Court SHALL TRANSMIT the file to the Northern District of

Illinois and SHALL CLOSE this Court’s file in the action.

 

DATED: 8/16/06

__________________________________

JEREMY FOGEL

United States District Judge

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Case No. C 06-3450 JF (RS)

ORDER (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS’ MOTION TO DISMISS ETC.

(JFLC2)

This Order was served on the following persons:

John C. Gorman jgorman@gormanmiller.com

Craig Alan Hansen chansen@gormanmiller.com

Michael J. Hoisington mhoisington@higgslaw.com,

Ross Kimbarovsky rossk@uhlaw.com

Charles F. Reidelbach, Jr. reidelbach@higgslaw.com,

Phillip Samouris samouris@higgslaw.com, moklestadn@higgslaw.com

Richard Henry Tilghman , IV rhtilghman@uhlaw.com 

Case 5:06-cv-03450-JF Document 57 Filed 08/16/06 Page 10 of 10