UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

FORD MOTOR COMPANY, et al., 

Plaintiffs,

v.

AUTEL U.S. INC. and AUTEL 

INTELLIGENT TECHNOLOGY

CO., LTD., 

Defendants.

_____________________________/

Case No. 2:14-cv-13760

Judge Terrence G. Berg

 

DEFENDANTS’ MOTION TO DISMISS

Defendants Autel U.S. Inc. (“Autel.US”) and Autel Intelligent Technology 

Co., Ltd. (“Autel ITC”) (collectively, “Autel”), through counsel, respectfully move 

for dismissal of the Complaint filed by Plaintiffs Ford Motor Company and Ford 

Global Technologies, LLC (“Ford”). The basis of this Motion is that all counts in 

the Complaint fail to state a claim on which relief can be granted and, in addition, 

personal jurisdiction is lacking as respects Autel ITC. This Motion is supported by 

law and analysis set forth in the accompanying Brief. 

Counsel for Autel contacted counsel for Ford on January 28, 2015 

requesting concurrence in the relief sought with this motion, and concurrence has 

not been reached.

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Respectfully submitted,

KERR, RUSSELL AND WEBER, PLC

By:/s/Fred K. Herrmann

Fred K. Herrmann (P49519)

Detroit Center, Suite 2500

500 Woodward Avenue

Detroit, Michigan 48226

(313) 961-0200

(313) 961-0388 (Facsimile)

fherrmann@kerr-russell.com

Dated: January 30, 2015

DRINKER BIDDLE & REATH LLP

Keith A. Walter

Zhun Lu

Thatcher Rahmeier

222 Delaware Ave., Ste. 1410

Wilmington, DE 19801-1621 

(302) 467-4200 

(302) 467-4201 (Facsimile) 

keith.walter@dbr.com

zhun.lu@dbr.com

thatcher.rahmeier@dbr.com

Attorneys for Defendants Autel U.S. Inc. and 

Autel Intelligent Technology Co., Ltd.

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

FORD MOTOR COMPANY, et al., 

Plaintiffs,

v.

AUTEL U.S. INC. and AUTEL 

INTELLIGENT TECHNOLOGY

CO., LTD., 

Defendants.

_____________________________/

Case No. 2:14-cv-13760

Judge Terrence G. Berg

 

BRIEF IN SUPPORT OF

DEFENDANTS’ MOTION TO DISMISS

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TABLE OF CONTENTS

STATEMENT OF ISSUES PRESENTED.................................................................v

PRELIMINARY STATEMENT ................................................................................1

FACTUAL ALLEGATIONS .....................................................................................3

A. Copyright and Trade Secret Allegations................................................3

B. Trademark Allegations...........................................................................5

C. Facts Regarding Personal Jurisdictions..................................................7

STANDARD OF REVIEW........................................................................................7

A. Legal Standard Under Rule 12(b)(6)......................................................7

B. Legal Standard Under Rule 12(b)(2)......................................................8

ARGUMENT..............................................................................................................8

I. The Copyright Claims Are Not Plausible on Their Face and 

Should Be Dismissed. ............................................................................8

A. The Copyright Infringement Claim Should Be Dismissed....................9

B. The Circumvention of Copyright Protection Claim Merits 

Dismissal. .............................................................................................11

II. The Federal Trademark Claims Should be Dismissed.........................15

III. The Michigan State Law Claims Are Not Plausible on Their 

Face and Should Be Dismissed. ...........................................................19

A. The Trade Secret Claims Should be Dismissed. ..................................19

B. The Trademark-Related State Law Claims Also Warrant 

Dismissal. .............................................................................................22

IV. Personal Jurisdiction is Lacking as to Defendant Autel ITC...............23

CONCLUSION.........................................................................................................25

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TABLE OF AUTHORITIES

Page(s)

CASES

Ashcroft v. Iqbal,

556 U.S. 662 (2009)...................................................................................7, 15, 18

Bell Atlantic Corp. v. Twombly,

550 U.S. 544 (2007).....................................................................................7, 8, 21

Chamberlain Grp., Inc. v. Skylink Techs., Inc.,

381 F.3d 1178 (Fed. Cir. 2004) ..........................................................................12

CMI v. Intermet,

649 N.W.2d 808 (Mich. App. 2002)...................................................................21

Compuware Corp. v International Business Machines,

2003 U.S. Dist. LEXIS 24894 (E.D. Mich. 2003)..............................................21

Curcio Webb LLC v. Nat'l Benefit Programs Agency, Inc.,

79 U.S.P.Q.2D 1119, 2006 U.S. Dist. LEXIS 394 (S.D. Ohio 2006)................11

Daddy's Junky Music Stores, Inc. v. Big Daddy's Family Music Ctr.,

109 F.3d 275 (6th Cir. 1997) ..............................................................................16

Dassault Systemes, S.A. v. Childress,

No. 09-10534, 2014 WL 6865498 (E.D. Mich. Dec. 3, 2014)...........................22

Dice v. Bold Technologies,

913 F. Supp. 2d 389 (E.D. Mich. 2012) .......................................................12, 20

Dorchen/Martin Assocs. v. Brook of Cheboygan, Inc.,

838 F. Supp. 2d 607 (E.D. Mich. 2012) ...............................................8, 9, 10, 16

Dow Jones & Co. v. Ablaise Ltd.,

606 F.3d 1338 (Fed. Cir. 2010) ..........................................................................23

Feist Publ'ns, Inc. v. Rural Tel. Servs. Co.,

499 U.S. 340 (1991)..................................................................................9, 10, 11

Hensley Mfg. v. ProPride, Inc.,

579 F.3d 603 (6th Cir. 2009) ............................................................16, 17, 18, 19

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Herman Miller, Inc. v. Palazzetti Imports and Exports, Inc.,

270 F.3d 298 (6th Cir. 2001) ..............................................................................18

Interactive Prods. Corp. v. A2Z Mobile Office Solutions, Inc.,

326 F.3d 687 (6th Cir. 2003) ........................................................................16, 17

Janda v. Riley-Meggs Industries, Inc.,

764 F. Supp. 1223 (E.D. Mich. 1991) ................................................................22

John Labatt Ltd. v. Molson Breweries,

853 F. Supp. 965 (E.D. Mich. 1994) ..................................................................22

Kewanee Oil Co. v. Bicron Corp.,

416 U.S. 470 (1974)............................................................................................21

Kohus v. Mariol,

328 F.3d 848 (6th Cir. 2003) ................................................................................9

Kubik, Inc. v. Hull,

224 N.W.2d 80 (Mich. App. 1974).....................................................................20

Lafarge Corp. v. Altech Envt’l USA,

220 F. Supp. 2d 823 (E.D. Mich. 2002) ...................................................8, 23, 24

Leapers, Inc. v. First Quality Distributors, Inc.,

No. 11-15058, 2012 WL 1714938 (E.D. Mich. May 15, 2012).........................22

Leelanau Wine Cellars, Ltd. v. Black & Red, Inc.,

502 F.3d 504 (6th Cir. 2007) ..............................................................................22

Lexmark Int’l, Inc. v. Static Control Components, Inc.,

387 F.3d. 522 (6th Cir. 2004) ......................................................................passim

Michels v. Monaco Coach Corp.,

298 F. Supp. 2d 642 (E.D. Mich. 2003) .............................................................23

Mike’s Train House, Inc. v. Lionel, L.L.C.,

472 F.3d 398 (6th Cir. 2006) ..............................................................................20

Nagle Indus., Inc. v. Ford Motor Co.,

173 F.R.D. 448 (E.D. Mich. 1997).....................................................................21

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Nat'l Bus. Dev. Servs., Inc. v. Am. Credit Educ. & Consulting, Inc.,

299 F. App'x 509 (6th Cir. 2008)......................................................................8, 9

Service Solutions U.S., LLC v. Autel US, Inc.,

C.A. No. 13-10534-TGB-LJM, Dkt. No. 31 ......................................................23

United States v. Reichert,

747 F.3d 445 (6th Cir. 2014) ..............................................................................21

Veteran Med. Prods., Inc. v. Bionix Dev. Corp.,

2008 WL 696546 (W.D. Mich. March 13, 2008)...............................................21

STATUTES, RULES & REGULATIONS

17 U.S.C. § 101........................................................................................................10

17 U.S.C. §§ 101 et seq..............................................................................................5

17 U.S.C. § 1201............................................................................................ 5, 12-15

17 U.S.C. § 1201 et seq............................................................................................11

Fed. R. Civ. P. 9(b) .............................................................................................vi, 23

Fed R. Civ. P. 12(b)(2).....................................................................................3, 8, 23

Fed. R. Civ. P. 12(b)(6).....................................................................................passim

M.C.L. § 445.903.....................................................................................................22

M.C.L. § 445.1902(d) ..............................................................................................20

M.C.L. § 445.1903(1) ..............................................................................................19

M.C.L. § 445.1908...................................................................................................21

M.C.L. § 600.711.....................................................................................................23

OTHER AUTHORITIES

Nimmer on Copyrights § 3.04[B][2]........................................................................10

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STATEMENT OF ISSUES PRESENTED

Issue #1:

Should Ford’s claim for copyright infringement be dismissed on the basis 

that Ford failed to allege that any original elements of any compilation of data 

within the FFData file were copied?

Issue #2:

Should Ford’s claim for circumvention of technological measures under the 

DMCA be dismissed on the basis that Ford did not sufficiently allege ownership of 

copyrightable subject matter accessed as a result of circumvention, or a prohibited 

purpose by Autel, or that sufficient facts were not alleged that would show the

DMCA exemption for reverse engineering to be inapplicable? 

Issue #3:

Should Ford’s Lanham Act trademark claims be dismissed on the basis that 

Ford failed to allege facts sufficient to show use of the Ford Marks as a trademark, 

or otherwise on the basis that those allegations lack sufficient factual detail and 

amount to permissible fair use?

Issue #4:

Should Ford’s claims for trade secret misappropriation and unjust 

enrichment under Michigan law be dismissed on the basis that insufficient facts are 

pled to show a “trade secret” or that the conduct complained of was not 

permissible reverse engineering, or based on preemption principles in the case of 

the unjust enrichment claim?

Issue #5:

Should Ford’s claims for unfair competition under Michigan law and 

violation of the Michigan Uniform Trade Practices Act (MUTPA) be dismissed for 

the same reason as the Lanham Act claims, and additionally based on Fed. R. Civ. 

P. 9(b) with respect to the MUTPA claim?

Issue #6:

Should Autel Intelligent Technology Co., Ltd. be dismissed on the basis that 

personal jurisdiction over that entity is lacking?

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PRELIMINARY STATEMENT

In Lexmark Int’l, Inc. v. Static Control Components, Inc., 387 F.3d. 522 (6th 

Cir. 2004), a copyright action by a manufacturer of ink jet printers against an 

aftermarket supplier of replacement toner cartridges, the Sixth Circuit dramatically 

curtailed efforts by manufacturers to misuse copyright law to limit the sales of 

aftermarket products. Troubled by the manufacturer’s efforts to use copyright law 

“offensively” rather than defensively, Judge Merritt wrote separately regarding the 

potential of such misuse to allow manufacturers to “create monopolies” in the 

aftermarket through use: “Automobile manufacturers, for example, could control 

the entire market of replacement parts for their vehicles . . . .” Id. at 552-53. 

Ten years later, Ford has shown Judge Merritt’s concern to be well founded, 

as Ford brings this test case against Autel, a manufacturer of automotive diagnostic 

equipment, which if successful would have dramatic anticompetitive consequences 

to all manufacturers and users of aftermarket automotive products. By its 

Complaint, Ford seeks to enjoin sales of Autel’s products by obtaining a 

registration of copyright in a data compilation after Autel permissibly reverse 

engineered it to achieve interoperability, characterizing those efforts as “hacking.” 

Ford then goes a step further, invoking trademark law to misguidedly claim that 

the mere mention of Ford’s name is unlawful, even when the only use complained 

of is Autel’s identification of the various vehicle brands serviced by Autel’s 

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products. An examination of the factual allegations in Ford’s Complaint reveals 

that, once stripped of Ford’s accusatory characterizations, those allegations do not 

clear the plausibility bar of Twombly/Iqbal, and merit dismissal under Rule 

12(b)(6).

With regard to Ford’s copyright claims, the infringement claim must be 

dismissed because the copyright registration, obtained just a few months before 

bringing this Complaint, states on its face that it is for a compilation of data and 

not for the computer code itself, and there is no allegation that Autel copied the 

compilation of Ford’s data. The DMCA anti-circumvention claim fails because 

there is no allegation that a copyrighted work was accessed by the alleged 

circumvention or that circumvention was for the purpose of pirating copyrighted 

works, or that the alleged conduct is anything other than reverse engineering.

The trademark claims fare no better. The sine qua non of trademark law is 

consumer confusion as to product source, but the Complaint is bereft of factual 

allegations that would support such an inference under Twombly/Iqbal. Ford 

alleges only that Autel uses the Ford mark, alongside other automakers’ 

names/logos, on the menu screen of the Autel-branded product when it is turned 

on. This cannot qualify as “trademark use,” i.e. use of the Ford name as an 

indicator of source. Alternatively, it is permissible fair use under the Lanham Act. 

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No aftermarket manufacturer could ever sell a product if it could not identify the 

brand(s) of vehicles for which the product is interoperable.

The state law claims must be dismissed for similar reasons. The trade secret 

and unjust enrichment claims fail for lack of sufficient allegations of identifiable 

and enforceable trade secrets, or allegations that they were accessed in confidence. 

The remaining two state law claims are essentially trademark claims based on the 

same untenable allegations, and fail for the same reason as the Lanham Act claims. 

Finally, one of the two Autel entities, Autel Intelligent Technology Co., Ltd., 

moves for dismissal per Rule 12(b)(2) because personal jurisdiction is lacking. In 

sum, the complaint should be dismissed with prejudice.

FACTUAL ALLEGATIONS

A. Copyright and Trade Secret Allegations

Ford alleges that it developed a diagnostic tool referred to as the “IDS 

System” to diagnose and facilitate the repair of its vehicles. Complaint (“Compl.”)

¶ 13. Ford refers to the hardware and software components of the IDS System as 

its “Diagnostic Tools,” which plug into and interfaces with the vehicle’s on-board 

computer system using Ford’s “IDS Software.” Compl. ¶¶ 14-16. The IDS 

System, according to Ford, contains various “compilations of data,” including 

compilations “made generally available pursuant to applicable federal statutes,” 

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and compilations “not made publicly available and constitute trade secrets used by 

Ford and its network of authorized dealers and repair facilities.” Id. ¶¶ 18-19. 

Ford never states which of this information is publicly available and which 

is not, and what qualifies the referenced data compilations as “trade secrets.” Even 

so, Ford contends that one of the compilations within the IDS System that Ford 

believes is a “trade secret” is the allegedly encrypted “FFData” file. Compl. ¶¶ 19-

20. Ford alleges it obtained a copyright registration “for data from the FFData,” 

but does not specify which data from the FFData file was the subject of the 

registration, or how much. In any case, the copyright registration, attached to the 

Complaint as Exhibit A, states it is for a “compilation of data” and that it was not 

registered until May 20, 2014. Id., Ex. A. Notably, the tracking number on Ford’s 

copyright application, shown on the certificate, is called “F.Autel.” Id.

Ford then alleges that Autel created “a program titled PARSEALL.EXE” to 

“obtain unauthorized access to the FFData file compilations of data” in the IDS 

System, and used it “to extract the FFData file and copied the FFData file onto 

various products sold by Autel,” including Autel’s DS708 tool. Compl. ¶¶ 21-23. 

Ford alleges it knows this because, when the Autel DS708 product is connected to 

a Ford vehicle and interfaces with its IDS Software, various “test entries” from the 

FFData file may be found on the screen of the Autel DS708 and the IDS Software. 

Id. ¶¶ 24-26. The presence of this test data “conclusively demonstrates,” according 

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to Ford, that “Autel copied Ford’s proprietary database.” Id. ¶¶ 26-27. Ford never 

alleges, however, any facts to show the compilation of data on the Autel product –

i.e. the specific selection and arrangement of the allegedly copied data files – is the 

same as or substantially similar to the selection and arrangement of the subset of 

the FFData file for which Ford allegedly obtained its registration. Id. at 24-28, 32.

Nonetheless, Ford alleges Copyright Infringement under 17 U.S.C. §§ 101 et 

seq. (First Claim), Circumvention of a Copyright Protection System under 17 

U.S.C. § 1201 (Second Claim) and Misappropriation of Trade Secrets (Fifth 

Claim) and Unjust Enrichment (Sixth Claim). Compl. ¶¶ 31-44, 75-89.

B. Trademark Allegations

Ford also alleges that it owns and possesses “numerous registrations” for the 

word mark FORD and the so-called “Ford Oval.” Compl. ¶¶ 10-11. Ford does not 

identify these “numerous registrations” with the exception of Reg. No. 3,657,597 –

FORD & Design for “automobile repair and maintenance services” in International 

Class 37, attached as Exhibit B (and identified as the “FORD OVAL” registration). 

Compl., ¶ 30 & Ex. B. Ford refers to this registration, and the unidentified other 

“numerous registrations,” collectively as the “Ford Marks.” Id. ¶ 11. 

Ford’s specific trademark infringement allegations against Autel are set forth 

in a single paragraph. Compl. ¶ 29. In it, Ford alleges that “Autel also uses the 

FORD OVAL® on its products without authorization or a license from Ford,” and 

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includes a screen-shot of the electronic menu screen: 

Compl. ¶ 29. In the image, the “USA” touch button is shaded (showing it has been 

depressed), revealing the FORD name/logo alongside other American car model 

buttons; other buttons are immediately below for “European” and “Asian” models.

Thus, the only complained of use is the depiction of the FORD name and 

logo on an electronic menu screen button, alongside other carmakers, on an Autelbranded product. There is no allegation that Autel used the Ford mark to indicate 

the source of its product. Id. There also are no factual allegations stating why 

Autel’s use is likely to create consumer confusion. Id. ¶¶ 45-52. Even so, Ford 

alleges that this use by Autel entitles Ford to relief under the Lanham Act, in 

claims for Federal Trademark Infringement (Third Claim) and False Designation 

of Origin (erroneously also identified as Ford’s Third Claim), Compl. ¶¶ 45-61, 

and under Michigan law for unfair competition (Fourth Claim) and violation of the 

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Michigan Uniform Trade Practices Act (Fifth Claim). Id. ¶¶ 62-74.

C. Facts Regarding Personal Jurisdiction

Autel ITC is a Chinese corporation that is located and operates in China. 

See Declaration of Hongjing Li attached as Exhibit A at ¶ 4. Autel.US is a wholly 

owned subsidiary of Autel ITC based in New York. (Ex. A at ¶ 21). Autel ITC 

lacks contacts within this jurisdiction, separate and apart from the activities of its 

subsidiary, which would subject it to jurisdiction here. (Ex. A at ¶¶ 4-23). 

STANDARD OF REVIEW

A. Legal Standard Under Rule 12(b)(6)

Notice pleading under the Federal Rules of Civil Procedure “does not unlock 

the doors of discovery for a plaintiff armed with nothing more than conclusions.” 

Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009). In Iqbal, the United States Supreme 

Court clarified the standard for dismissal under Rule 12(b)(6), finding dismissal 

warranted where the complaint does not “allege ‘sufficient factual matter’ to show that 

a claim is facially plausible.” Iqbal, 556 U.S. at 675. Under this standard, “[f]actual 

allegations must be enough to raise a right to relief above a speculative level, on the 

assumption that all the allegations in the complaint are true . . . .” Bell Atlantic Corp. 

v. Twombly, 550 U.S. 544, 55-56 (2007). Accordingly, “a plaintiff's obligation to 

provide the 'grounds' of his 'entitle[ment] to relief' requires more than labels and 

conclusions, and a formulaic recitation of the elements of a cause of action will not 

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do.” Id. at 555 (citations omitted). Rather, to be plausible on its face, the pleading 

must include sufficient "factual content that allows the court to draw the reasonable 

inference that the defendant is liable for the misconduct alleged.” Id. at 570.

In the specific context of copyright infringement, the Sixth Circuit has 

recognized that “[c]opyright infringement lends itself readily to abusive litigation, 

since the high cost of trying such a case can force a defendant who might otherwise 

be successful in trial to settle in order to avoid the time and expenditure of a 

resource intensive case,” Dorchen/Martin Assocs. v. Brook of Cheboygan, Inc., 

838 F. Supp. 2d 607, 611 (E.D. Mich. 2012), citing Nat'l Bus. Dev. Servs., Inc. v. 

Am. Credit Educ. & Consulting, Inc., 299 F. App'x 509, 512 (6th Cir. 2008), as a 

result of which “greater particularity in pleading” is required for such claims. Id. 

B. Legal Standard Under Rule 12(b)(2)

On a personal jurisdiction challenge under Rule 12(b)(2), the plaintiff bears 

the burden of proof. Lafarge Corp. v. Altech Envt’l USA, 220 F. Supp. 2d 823, 827 

(E.D. Mich. 2002). Personal jurisdiction must be appropriate under the laws of 

Michigan and under the Due Process Clause of the United States Constitution. Id. 

ARGUMENT

I. The Copyright Claims Are Not Plausible on Their Face and Should Be 

Dismissed.

Ford’s copyright claims – both the infringement claim under the Copyright 

Act, and the circumvention claim under the Digital Millennium Copyright Act 

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(DMCA) – lack sufficient factual allegations to clear the plausibility bar of 

Twombly/Iqbal. Both claims should be dismissed accordingly.

A. The Copyright Infringement Claim Should Be Dismissed.

The pleading defect in Ford’s claim for copyright infringement (First Claim 

for Relief) is that it fails to allege that the specific compilation of data that is the 

subject of its copyright registration was copied by Autel.

“To establish copyright infringement, two elements must be proven: 

ownership of a valid copyright and copying of constituent elements of the work 

that are original.” Dorchen/Martin Assocs., 838 F. Supp. 2d at 617, citing Feist 

Publ'ns, Inc. v. Rural Tel. Servs. Co., 499 U.S. 340, 361 (1991); see Kohus v. 

Mariol, 328 F.3d 848, 853 (6th Cir. 2003). For Rule 12(b)(6) purposes, the 

allegation of copying must be sufficiently particularized to permit a plausible 

inference that infringement has occurred. See Dorchen/Martin Assocs., 838 F. 

Supp. 2d at 611-13, citing Nat'l Bus. Dev. Servs., Inc. v. Am. Credit Educ. & 

Consulting, Inc., 299 F. App'x at 512.1

1

 In Dorchen/Martin, the “Plaintiff . . . identified a work product that infringed on 

Plaintiff's copyrighted work,” and “allege[d] the finished facility as a whole is 

‘substantially similar,’” the claim was nonetheless dismissed because “Plaintiff has 

not described the manner in which Defendants’ work infringed upon Plaintiff's 

product in order to adequately give Defendants notice of the claim against them.” 

Similarly, in National Business Development Services, the Sixth Circuit affirmed 

dismissal of a copyright infringement claim where the defendant’s work was 

alleged to have “incorporate[d] the copyrighted materials” of the plaintiff’s 

copyright, but did not identify the elements incorporated. 299 F. App'x at 511-12.

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Here, Ford’s conclusory allegation of copying is deficient. Ford alleges it 

created a “FFData” file, Compl. ¶ 19, and that unspecified “data from the FFData” 

is encompassed within the registration, id. ¶ 28 & Eh. A. Not only do these 

allegations fail to state which “constituent elements” were copied or whether they 

are “original,” Dorchen/Martin Assocs., 838 F. Supp. 2d at 617, they are 

particularly deficient in light of the limited nature of the authorship stated on the 

copyright registration it obtained, which clarifies the copyright is for a 

“compilation of data.” Id.; see 17 U.S.C. § 101 (defining “compilation”). 

That the registration is only for a compilation of data is important, because 

protection for data compilations is much more limited. See, e.g., Feist 

Publications, Inc. v. Rural Telephone Service Co., 499 U.S. 340, 351 (1991) (“A 

factual compilation is eligible for copyright if it features an original selection or 

arrangement of facts, but the copyright is limited to the particular selection or 

arrangement.”) (emphasis added); Nimmer on Copyrights § 3.04[B][2] (discussing 

limitation of protection to author’s selection, coordination or arrangement). Thus, 

Ford has alleged that it has obtained a copyright registration for the compilation of 

some of the data from its “FFData” file within its so-called IDS System for 

diagnosing its vehicles.

The Complaint lacks any allegation, much less a sufficiently factually 

detailed allegation, that Autel copied the specific compilation of the subset of the 

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FFData file for which registration was obtained. Rather, Ford just alleges that 

contents of the FFData file can be found on the Autel device, without commenting 

on their selection or arrangement. Compl. ¶ 24-27. This is insufficient to establish 

liability, because copying the elements of a copyright-registered compilation is not 

unlawful, unless the selection and arrangement of that data is copied. See Curcio 

Webb LLC v. Nat'l Benefit Programs Agency, Inc., 79 U.S.P.Q.2D 1119, 2006 U.S. 

Dist. LEXIS 394, at *19 (S.D. Ohio 2006) (“If a work qualifies as a copyrightable 

factual compilation, it receives only thin copyright protection: ‘the facts contained 

in [the] existing work[] may be freely copied because copyright protects only the 

elements that owe their origin to the compiler--the selection, coordination and 

arrangement of facts.’”), quoting Feist, 499 U.S. at 359. Here, Ford’s alleged 

copyright in the compilation of data can only protect, at most, the arrangement of 

data, not the underlying data itself, which may be “freely copied.” 499 U.S. at 359.

Because Ford has alleged only that data in the FFData file was copied, 

without alleging that the compilation of that data was copied, Ford has alleged 

nothing unlawful. The First Claim for Relief should be dismissed accordingly.

B. The Circumvention of Copyright Protection Claim Merits Dismissal.

Ford’s Second Claim for Relief arises under the anti-circumvention 

provisions of the Digital Millennium Copyright Act (“DMCA”), 17 U.S.C. § 1201 

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et seq. Ford alleges that Autel violated this statute by “decrypting” the FFData file 

and using the information obtained. Compl. ¶¶ 38-44. 

Enacted in 1998, the DMCA does not create new property rights, but rather 

“creates new ‘causes of action for liability’” for copyright owners. Dice v. Bold 

Technologies, 913 F. Supp. 2d 389, 409 (E.D. Mich. 2012), quoting Chamberlain 

Grp., Inc. v. Skylink Techs., Inc., 381 F.3d 1178, 1192 (Fed. Cir. 2004). The 

statute provides that, subject to certain carve-outs, “No person shall circumvent a 

technological measure that effectively controls access to a work protected under 

this title,” 17 U.S.C. § 1201(a)(1), and “No person shall manufacture . . . or 

otherwise traffic in any technology [or] product . . . primarily designed or produced 

for the purpose of circumventing a technological measure . . . .” 17 U.S.C. § 

1201(a)(2); see Dice, 913 F. Supp. 2d at 409; Lexmark Int’l, Inc., 387 F.3d. at 547. 

Here, Ford’s DMCA allegations do not state a claim for three reasons: (1) 

Ford does not allege that it owned copyrightable subject matter at the time of the 

alleged circumvention; (2) Ford fails to allege a prohibited purpose of the alleged 

circumvention, and (3) Ford’s allegations trigger the DMCA exemption for reverse 

engineering and do not set forth facts showing why that exemption does not apply.

First, Ford does not allege it owned, at the time of the alleged 

circumvention, a “work protected under this title.” Ford alleged it obtained a 

copyright registration in May 2014, which clearly post-dated the alleged 

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circumvention, as the certificate reflects Ford used “F.Autel” as the tracking 

number for its application. Compl., Ex. A. The complaint is silent as to whether 

Ford owned a copyrightable work at the time of the alleged circumvention. As 

explained by the Sixth Circuit: 

One other point deserves mention. All three liability provisions of this 

section of the DMCA require the claimant to show that the 

“technological measure” at issue “controls access to a work protected 

under this title,” see 17 U.S.C. §1201(a)(2)(A)-(C), which is to say a 

work protected under the general copyright statute, id. § 102(a). 

Lexmark Int’l, Inc., 387 F.3d at 550 (emphasis in original). Perhaps Ford believes 

that the work for which registration was obtained is the exact same as the work 

allegedly decrypted, without any modifications, but in the absence of an allegation 

to that effect, the Court cannot simply assume it to be so.

A second defect is the absence of an allegation, required by subsection 

(a)(2), that the purpose of the circumvention was to trade in pirated goods. This 

requirement is rooted in Judge Merritt’s concurring opinion in Lexmark :

By contrast, Lexmark would have us read this statute in such a way that 

any time a manufacturer intentionally circumvents any technological 

measure and accesses a protected work it necessarily violates the 

statute regardless of its "purpose." Such a reading would ignore the 

precise language - "for the purpose of" - as well as the main point of the 

DMCA - to prohibit the pirating of copyright-protected works such as 

movies, music, and computer programs. If we were to adopt Lexmark's 

reading of the statute, manufacturers could potentially create 

monopolies for replacement parts simply by using similar, but more 

creative, lock-out codes. Automobile manufacturers, for example, 

could control the entire market of replacement parts for their vehicles 

by including lock-out chips. Congress did not intend to allow the 

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DMCA to be used offensively in this manner, but rather only sought to 

reach those who circumvented protective measures "for the purpose" of 

pirating works protected by the copyright statute. Unless a plaintiff can 

show that a defendant circumvented protective measures for such a 

purpose, its claim should not be allowed to go forward. 

387 F.3d at 552-53 (Merritt, J., Concurring). Neither of the other two panel judges 

disagreed with this point, and their comments reflect agreement. See 387 F.3d at 

553 (“[M]y colleagues and I agree on a number of points regarding this case. . . . 

We agree that the Digital Millennium Copyright Act (DMCA) was not intended by 

Congress to be used to create a monopoly in the secondary markets for parts or 

components of products that consumers have already purchased.”) (Feikins, J., 

concurring in part and dissenting in part). In fact, the very rationale of requiring 

this element of proof was the concern that a larger manufacturer may “enforce its 

will against a smaller rival” by imposing upon it “the potential cost of extended 

litigation and discovery . . . .” Id. at 552. Thus, because there is no allegation that 

Autel acted with a purpose of pirating, dismissal is required.

Third, Ford’s Complaint lacks sufficient allegations that the reverse 

engineering carve-out of the DMCA is inapplicable. 17 U.S.C. § 1201 provides:

(f) Reverse Engineering. — (1) Notwithstanding the provisions of 

subsection (a)(1)(A), a person who has lawfully obtained the right to use 

a copy of a computer program may circumvent a technological measure 

that effectively controls access to a particular portion of that program for 

the sole purpose of identifying and analyzing those elements of the 

program that are necessary to achieve interoperability of an 

independently created computer program with other programs, and that 

have not previously been readily available to the person engaging in the 

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circumvention, to the extent any such acts of identification and analysis 

do not constitute infringement under this title.

In light of Ford’s factual allegations – namely, that Autel sells an electronic 

diagnostic product for use with various automotive brands, including Ford, that 

incorporates data used by Ford’s “network of authorized dealers and repair 

facilities” to interface with Ford vehicles – the inference from these facts is that 

use by Autel was “to achieve interoperability”2 of Autel’s product with Ford’s onboard automotive engine software control unit, so that independent service 

facilities, mechanics and individual tinkerers would be able to work on their cars as 

well. See, e.g., Lexmark Int’l, Inc., 387 F.3d 545-46, 50-51. Even if there is a 

possible inference that this section of the DMCA is inapplicable, that is not 

enough, especially after Lexmark; plausibility is required. Iqbal, 556 U.S. at 679. 

II. The Federal Trademark Claims Should be Dismissed.

Ford’s Lanham Act claims (both denoted “Third Claim for Relief”) warrant 

dismissal because the use alleged by Ford – namely, appearance on a menu screen, 

to allow a user to specify the make of car on which the Autel product is to be used 

– is not “trademark use,” and there are no factual allegations that would permit a 

contrary inference. Alternatively, fair use bars recovery as a matter of law.

2

 The term “interoperability” is defined in 17 U.S.C. § 1201(f)(4) to mean “the 

ability of computer programs to exchange information, and of such programs 

mutually to use the information which has been exchanged.”

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“The touchstone of liability [for trademark infringement] is whether the 

defendant’s use of the disputed mark is likely to cause confusion among consumers 

regarding the origin of the goods offered by the parties.” Daddy's Junky Music 

Stores, Inc. v. Big Daddy's Family Music Ctr., 109 F.3d 275, 280 (6th Cir. 1997). 

“In determining whether a likelihood of confusion exists, a court will typically 

weigh the following eight factors: (1) strength of the senior mark; (2) relatedness 

of the goods or services; (3) similarity of the marks; (4) evidence of actual 

confusion; (5) marketing channels used; (6) likely degree of purchaser care; (7) the 

intent of defendant in selecting the mark; and (8) likelihood of expansion of the 

product lines.” Hensley Mfg. v. ProPride, Inc., 579 F.3d 603, (6th Cir. 2009), 

citing Daddy’s Junky Music Stores, Inc., 109 F.3d at 280; see also Interactive 

Prods. Corp. v. A2Z Mobile Office Solutions, Inc., 326 F.3d 687, 694 (6th Cir. 

2003); accord Dorchen/Martin Assocs. v. Brook of Cheboygan, Inc., 838 F. Supp. 

2d at 613 (applying same test to false designation of origin claim).

These factors notwithstanding, the Sixth Circuit in Hensley Manufacturing

observed that a trademark claim bypasses analysis of these factors, and is subject 

to dismissal under Rule 12(b)(6), where the mark is not, on its face, used to 

identify the source of the product – i.e., a non-trademark use. The court stated:

But the likelihood of confusion analysis also involves a preliminary 

question: whether the defendants “are using the challenged mark in a 

way that identifies the source of their goods.” Interactive Prods., 326 

F.3d at 695. If they are not, then the mark is being used in a “‘non-

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trademark’ way” and trademark infringement laws, along with the 

eight-factor analysis, do not even apply. Id. 

Analogizing that case to Interactive Products, where the defendant’s use of the 

plaintiff’s mark in a post-domain path was deemed non-actionable, the Sixth 

Circuit in Hensley Manufacturing found that the defendant’s use of the plaintiff’s 

“Hensley” mark was not actionable because the plaintiff merely used the name in 

connection with its advertising – whereas the plaintiff’s product name, the "Pivot 

Point Projection Hitch" or "3P Hitch,” was “not even remotely similar to the 

“Hensley” trademark. 579 F.3d at 610-11.

On this score, the case for dismissal is even stronger here. Ford does not 

even allege that Autel uses the Ford Marks in a way that identifies the source of 

Autel’s goods – rather, Ford merely contends, as did Hensley Manufacturing, that 

its name was used without permission on the Autel-branded product, as though the 

Lanham Act had somehow become a strict liability statute. And it is readily 

apparent from examining the sole use complained of that Autel is not using the 

Ford name as a mark: rather, as the screenshot shows, it is simply identifying the 

maker of the car to be worked on, so that the user may depress the button selecting 

it for use with the Autel product. It certainly cannot be characterized as use that 

might cause a mistaken purchasing decision, as the name appears on the electronic 

screen, which of course would not be visible to prospective buyers. Further, the 

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actual trademark under which the Autel product is sold (according to Ford), the 

Autel DS 708, Compl. ¶¶ 23-27, bears no resemblance at all to the Ford Marks.

Like the plaintiff in Hensley Manufacturing, Ford dutifully recites the rote 

elements of the claims, contending that Autel’s conduct was undertaken “with the 

intent to cause confusion, mistake, and to deceive customers.” Compl. ¶ 49. But 

also like Hensley Manufacturing, “such a conclusory and ‘formulaic recitation’ of 

the elements of a trademark infringement cause of action is insufficient to survive a 

motion to dismiss.” 579 F.3d at 611, citing Iqbal, 129 S. Ct. at 1954. In fact, Ford 

alleges almost no facts regarding to the eight factors relevant to a likelihood of 

confusion analysis, much less any facts showing use of the Ford Marks trademark. 

On the bare facts pled, dismissal is warranted.

These defects aside, fair use also operates as a bar. The Sixth Circuit 

reached the same conclusion in Hensley Manufacturing where, after finding that 

the plaintiff failed to state a claim under Twombly/Iqbal standards, the Court 

nonetheless evaluated the fair use defense on a Rule 12(b)(6) motion – and, finding 

that the defense applied, affirmed dismissal on that basis as well.

Under the fair use doctrine, “the holder of a trademark cannot prevent others 

from using the word that forms the trademark in its primary or descriptive sense.” 

579 F.3d at 612, quoting Herman Miller, Inc. v. Palazzetti Imports and Exports, 

Inc., 270 F.3d 298, 319 (6th Cir. 2001). Instead, “[t]he only right of exclusion that 

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trademark law creates in a descriptive word is in the secondary, new, 'trademark' 

meaning of the word that plaintiff has created. The original, descriptive primary 

meaning is always available for use by others to describe their goods, in the 

interest of free competition.” Id. And so here, it is apparent from the Complaint, 

including the screenshot shown, that Autel’s use was not to identify the product –

which already had a name – but rather in a descriptive sense, to describe the 

automobiles for which the Autel product could be used and calibrated. 

Were Ford’s allegations enough to state a claim – namely, that aftermarket 

providers cannot use the Ford name or logo to merely identify the make and model 

of the vehicle for which it is used – it would be a death knell to the very concept of 

an aftermarket for replacement parts or services by anyone other than the original 

manufacturer. A fair use defense clearly applies here, and warrants dismissal.

III. The Michigan State Law Claims Are Not Plausible on Their Face and 

Should Be Dismissed.

A. The Trade Secret Claims Should be Dismissed.

Based on the same allegations supporting the DMCA claim, Ford alleges in 

its Fifth Claim for Relief (the second of 2: Compl. at ¶¶ 75-83) that Autel 

misappropriated its trade secrets within the meaning of M.C.L. § 445.1903(1), and 

parrots those allegations in its Sixth Claim for Relief for unjust enrichment 

(Compl. ¶¶ 84-89). These claims also lack facial plausibility for three reasons.

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First, Ford has failed to properly allege the existence of a protectable trade 

secret, in several respects. The threshold failure is that Ford does not define what 

the “trade secrets” in question are.3

 Beyond that, Ford does not allege facts from 

which the Court may plausibly infer that the information in question qualifies as a 

“trade secret.” Such facts are central to this claim, as “[t]he first element of 

plaintiff alleging misrepresentation of trade secrets must prove is that the 

information at issue actually consists of a trade secret.” Mike’s Train House, Inc. 

v. Lionel, L.L.C., 472 F.3d 398, 410 (6th Cir. 2006).

Merely alleging information is “not publicly available” does not qualify it is 

a “trade secret”: under Michigan law, a trade secret must “[d]erive independent 

economic value” from not being generally known. M.C.L. § 445.1902(d). Ford 

has made no allegation of independent economic value. Also, “the information 

must, of necessity, be a Secret,” Dice Corp., 913 F. Supp. 2d at 406, quoting 

Kubik, Inc. v. Hull, 224 N.W.2d 80, 87 (Mich. App. 1974) – yet Ford admits it 

shares this information with authorized dealers and repair facilities, with no 

mention of confidentiality obligations. Compl. ¶ 18. In sum, Ford’s assertion that 

3

 Ford alleges only that its IDS System contains various data compilations, some 

of which “are made generally available pursuant to applicable federal statutes,” 

while [o]ther compilations of data within the IDS System . . . are not publicly 

available and constitute trade secrets . . . .” Compl. ¶ 18. Apparently these “trade 

secrets” are more than just the FFData file (because it is identified as only “[o]ne 

such compilation of data” among those trade secrets, per ¶ 19, and more than the 

contents of the copyright registration (which is a subset of the FFData, per ¶ 28). 

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unidentified information is a “trade secret,” without factual support, runs counter to 

Twombly’s directive to plead “more than labels and conclusions.” 550 U.S. at 555.

Second, the facts as alleged by Ford amount to reverse engineering, which is 

not actionable as trade secret misappropriation. See, e.g., Veteran Med. Prods., 

Inc. v. Bionix Dev. Corp., 2008 WL 696546, at *10 (W.D. Mich. March 13, 2008) 

(“trade secret law does not forbid the discovery of the trade secret by fair and 

honest means, e.g., independent creation or reverse engineering . . . .”), quoting 

Kewanee Oil Co. v. Bicron Corp., 416 U.S. 470, 489-90 (1974); see Nagle Indus., 

Inc. v. Ford Motor Co., 173 F.R.D. 448, 454 (E.D. Mich. 1997). State law has no 

application in this context. See United States v. Reichert, 747 F.3d 445, 447 (6th 

Cir. 2014) (“prior to the DMCA, a copyright owner would have had no cause of 

action against anyone who circumvented any sort of technological control . . . .”). 

Third, the unjust enrichment claim must be dismissed in any event because it 

is preempted by Michigan’s Uniform Trade Secrets Act (MUTSA). MCL § 

445.1908 (“this act displaces conflicting . . . law of this state providing civil 

remedies for misappropriation of a trade secret”); see Compuware Corp. v 

International Business Machines, 2003 U.S. Dist. LEXIS 24894, at *23 (E.D. 

Mich. 2003); CMI v. Intermet, 649 N.W.2d 808 (Mich. App. 2002).

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B. The Trademark-Related State Law Claims Also Warrant Dismissal.

Ford also relies on the same trademark infringement allegations to state 

claims for unfair competition under Michigan law (Fourth Claim for Relief) and 

violation of the Michigan Uniform Trade Practices Act, M.C.L. § 445.903 (Fifth 

Claim for Relief: first of 2, Compl., ¶¶ 69-74). These claims must be dismissed 

for the same reason that the Lanham Act claims are dismissed, discussed above.

Courts in this district have long recognized that the same Lanham Act 

analysis applies to these state law claims. See, e.g., John Labatt Ltd. v. Molson 

Breweries, 853 F. Supp. 965, 970 (E.D. Mich. 1994); Leelanau Wine Cellars, Ltd. 

v. Black & Red, Inc., 502 F.3d 504, 520 (6th Cir. 2007). As such, because 

dismissal of the Lanham Act claims is warranted, dismissal also is appropriate with 

respect to these state law claims. Id. Courts have reached this conclusion with 

regard to unfair competition, see, e.g., Leapers, Inc. v. First Quality Distributors, 

Inc., No. 11-15058, 2012 WL 1714938, at *9 (E.D. Mich. May 15, 2012) (granting 

motion to dismiss unfair competition claim where allegations were conclusory and 

lacked particulars); Dassault Systemes, S.A. v. Childress, No. 09-10534, 2014 WL 

6865498, at *8 (E.D. Mich. Dec. 3, 2014) (same), and even more readily with 

regard to claims under the MUTPA, as such claims sound in fraud and must be 

pled with particularity under Fed. R. Civ. P. 9(b). See, e.g., Michels v. Monaco 

Coach Corp., 298 F. Supp. 2d 642, 650 (E.D. Mich. 2003).

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IV. Personal Jurisdiction is Lacking as to Defendant Autel ITC.

Ford’s complaint improperly conflates the activities of two separate and 

distinct companies to establish personal jurisdiction over Autel ITC, a Chinese 

entity, based only on the contacts of its U.S. subsidiary, Autel.US. But Autel.US’s 

activities cannot be legally attributed to Autel ITC. See Dow Jones & Co. v. 

Ablaise Ltd., 606 F.3d 1338, 1349 (Fed. Cir. 2010). Autel ITC therefore seeks 

dismissal on the additional ground that the Court lacks personal jurisdiction over 

Autel ITC pursuant to Fed. R. Civ. P. 12(b)(2).4

Personal jurisdiction may be grounded in either general jurisdiction or 

limited (specific) jurisdiction. General jurisdiction exists if a corporation: (1) is 

incorporated in Michigan; (2) consents to jurisdiction in Michigan; or (3) engages 

in continuous and systematic business in Michigan. Id. citing Mich. Comp. Laws 

600.711. Limited personal jurisdiction exists if the defendant maintains minimum 

contacts with Michigan and those contacts give rise to the claim at issue. Lafarge, 

220 F. Supp. 2d at 828. Michigan’s long-arm statute provides five situations that 

will subject a corporation to limited personal jurisdiction which, if met, then 

requires the Court to determine whether asserting jurisdiction is fair under the Due 

Process Clause. Lafarge, 220 F. Supp. 2d at 828. 

4 In Service Solutions U.S., LLC v. Autel US, Inc., C.A. No. 13-10534-TGB-LJM, 

Dkt. No. 31, this Court only found that Autel ITC was subject to limited personal 

jurisdiction for the patent claims asserted in that case against unrelated products.

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Ford’s allegations related to personal jurisdiction are found only in 

paragraph 3 of the complaint, wherein Ford improperly lumps both Autel entities 

together and alleges: 

This action arises out of wrongful acts committed by Autel that are 

intentionally targeted at Ford in this District that subject Autel to 

personal jurisdiction here. Moreover, Autel markets, sells, furnishes, 

and supports the accused infringing products throughout the United 

States, including in the State of Michigan residents. . . . .

Compl. ¶ 3. As an initial matter, these allegations do not sufficiently allege, much 

less establish, that Autel ITC is subject to general jurisdiction in Michigan. As 

shown in the Declaration, Ford cannot do so in any event. (Ex. A at ¶¶ 4-23).

The complaint also fails to allege any facts sufficient to satisfy the five 

situations that will subject a corporation to limited personal jurisdiction under 

Michigan’s long-arm statute. Even if it did, such allegations would be trumped by 

the accompanying sworn evidence supplied by Autel ITC, confirming that none of 

the long-arm criteria apply. (Ex. A.). In particular, Autel ITC does not ship any 

products into Michigan (Ex. A at ¶ 12). Rather, Autel ITC sells accused products 

to Autel.US, CIF China, which then imports the products into the U.S. and sells 

them to U.S. distributors nationwide. (Ex. A at ¶ 22).

Due Process requires that Autel ITC have purposefully directed minimum 

contacts with Michigan, and Ford has submitted no evidence of this to support its 

bare allegations. Among other things, Autel ITC has not: (1) designed any 

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products to market specifically in Michigan (Ex. A at ¶ 18), (2) advertised in 

Michigan (Ex. A at ¶¶ 13-15 ); (3) established a method for providing regular 

advice to customers in Michigan, and does not provide advice to customers in 

Michigan (Ex. A at ¶ 19); or (4) marketed any accused products through a 

distributor who has agreed to serve as the sales agent in Michigan (Ex. A at ¶ 20). 

This evidence rebuts Ford’s bare allegation that Autel ITC is engaged in the sale, 

marketing or intentional targeting of this jurisdiction. Because Autel ITC does not 

have the necessary contacts with Michigan it should be dismissed from this case.

CONCLUSION

For the foregoing reasons, Defendants respectfully request that the Court 

dismiss the Complaint in its entirety, with prejudice. 

DRINKER BIDDLE & REATH LLP

Keith A. Walter

Zhun Lu

Thatcher Rahmeier

222 Delaware Ave., Ste. 1410

Wilmington, DE 19801-1621 

(302) 467-4200 

(302) 467-4201 (Facsimile) 

keith.walter@dbr.com

zhun.lu@dbr.com

thatcher.rahmeier@dbr.com

Respectfully submitted,

KERR, RUSSELL AND WEBER, PLC

By:/s/Fred K. Herrmann

Fred K. Herrmann (P49519)

Detroit Center, Suite 2500

500 Woodward Avenue

Detroit, Michigan 48226

(313) 961-0200

(313) 961-0388 (Facsimile)

fherrmann@kerr-russell.com

Attorneys for Defendants Autel U.S. Inc. and Autel Intelligent Technology Co., Ltd.

Dated: January 30, 2015

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

FORD MOTOR COMPANY, et al., 

Plaintiffs,

v.

AUTEL U.S. INC. and AUTEL 

INTELLIGENT TECHNOLOGY

CO., LTD., 

Defendants.

_____________________________/

Case No. 2:14-cv-13760

Judge Terrence G. Berg

 

CERTIFICATE OF SERVICE

I hereby certify that on January 30, 2015, I electronically filed the foregoing 

paper with the Clerk of the Court using the ECF system, which will send 

notification of such filing to counsel of record.

 

Dated: January 30, 2015

Respectfully submitted,

KERR, RUSSELL AND WEBER, PLC

By:/s/Fred K. Herrmann

Fred K. Herrmann (P49519)

Detroit Center, Suite 2500

500 Woodward Avenue

Detroit, Michigan 48226

(313) 961-0200

(313) 961-0388 (Facsimile)

fherrmann@kerr-russell.com

mpowell@kerr-russell.com

Attorneys for Defendants Autel U.S. and Autel 

Intelligent Technology Co., Ltd.

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