into Dlinois is too attenuated to constitute purposeful availment of Illinois. See Kooima v. Zacklift
Int'l, Inc., 209 F.R.D. 444 (D.S.D. 2002).
Specific Jurisdiction

Xing Te Hao is a Chinese corporation located in Shanghai, China that manufactures and
sells power tools. All of Xing Te Hao’s power tools, including the items in dispute, are developed
and manufactured in China. When Xing Te Hao sells these products, it receives purchase orders
at its Shanghai, China business address, and ships products from Shanghai, China based upon
these purchase orders. As for the sale of the items in dispute, none were sold to Illinois customers
directly. Indeed, the vast majority of the sales were to S.K. Enterprises, Inc. of Newburgh, New
York. As for Illinois, Xing Te Hao is not registered to do business there; has no sales agents,
employees, offices, manufacturing facilities, bank accounts, telephones or telephone listings there;
has not acquired ownership, possession or control of an asset or thing of value there; and has not
made, used, or sold any products there.

B&D argues that Xing Te Hao has purposefully directed its activities at Illinois on the
basis of its attendance at two trade conferences in Chicago, As way of background, since the
beginning of 2001, Xing Te Hao has been present in Illinois only twice: once in August 2001 and
a second time in August 2002.” Both of these visits occurred when Xing Te Hao was an exhibitor
during the National Hardware Show held in conjunction with International Hardware Week at
McCormick Place in Chicago, Illinois. Xing Te Hao exhibited at these shows to tens of thousands
of industry professionals from across the world. Of these two visits to Illinois, Xing Te Hao

exhibited one of the allegedly infringing products only once. Specifically, Xing Te Hao displayed

* The patents in suit issued on January 9, 2001 and September 11, 2001.
4


Additional Discovery

In the event that I am inclined to grant Xing Te Hao’s motion, B&D requests “a chance to
probe further” by taking jurisdictional discovery. Renner v. Lanard Toys Ltd., 33 F.3d 277, 283
Grd Cir. 1994); Toys “R” Us, Inc, v. Step Two, S.A., 318 F.3d 446, 456 (3d Cir. 2003) (“courts
are to assist the plaintiff by allowing jurisdictional discovery unless the plaintiff’s claim is ‘clearly

oo

frivolous.’”). As the foregoing discussion demonstrates, B&D has failed to provide enough
evidence establishing the existence of personal jurisdiction over Xing Te Hao in this matter, and I
am thus inclined to grant the motion. However, Xing Te Hao has identified several possible bases
for personal jurisdiction, which, upon further discovery, may prove sufficient. As a matter of
discretion, I grant B&D an additional eight weeks for limited jurisdictional discovery on the
following items:

1. Whether Xing Te Hao had any intent to sell the single 5-in-1 tool that it brought to
Ilinois for the August 2001 show such that its activity constituted “importation” of an
accused device;

2. Whether Xing Te Hao offered any product descriptions or price quotations of the
single 5-in-1 tool that it brought to Illinois such that its activity constituted an “offer to
sell;” and

3. Whether Xing Te Hao’s aggregate contacts support nationwide personal jurisdiction
under the stream of commerce theory as articulated in Beverly Hills.

Four weeks after the close of discovery, B&D is ordered to submit a brief addressing how the new
evidence gathered during this extended discovery affects the three issues specifically identified

above. Four weeks later, Xing Te Hao is ordered to reply to B&D’s submission. Shortly

thereafter, I will issue a final ruling on the motion to dismiss.


For specific jurisdiction, the Federal Circuit has established a three-prong test that must be
satisfied: (1) whether the defendant purposefully directed its activities at the residents of the
forum; (2) whether the claim arises out of or is related to those activities; and (3) whether
assertion of personal jurisdiction is reasonable and fair. HollyAnne Corp. v. TFT, Inc., 199 F.3d
1304, 1307 (Fed. Cir. 1999). Here, specific jurisdiction over Xing Te Hao does not exist because
it has not purposefully directed its activities at Illinois and because this case does not arise out of
or relate to Xing Te Hao’s activities in Illinois.

Nationwide Jurisdiction

Xing Te Hao’s aggregate contacts do not support nationwide personal jurisdiction under
the stream of commerce theory. Beverly Hills, 21 F.3d 1558. Merely placing products in the
stream of commerce is insufficient to sustain personal jurisdiction on this theory. See Asahi Metal
Indus. Co., Ltd. v. Superior Court of California, 480 U.S. 102, 112 (1987); Allen-Bradley Co.,
Inc. v. Datalink Techs., Inc., 55 F.Supp.2d 958, 961 (E.D. Wis. 1999) (granting motion to dismiss

- where plaintiff failed to present evidence showing that defendant played a role in establishing the
distribution channel or that defendant had expectation or knowledge that its products were going
to the forum). The plaintiff in Beverly Hills provided evidence that (1) over 50 of the accused
devices were being held for sale in the forum; (2) the defendant’s customers in the forum included
six retail outlets selling the accused device; (3) there was an ongoing commercial relationship
between the defendant and those retail outlets; and (4) there were particularized allegations in the
complaint that were not directly contravened by the defendant. 21 F.3d at 1560-64. In contrast,
B&D has come forward with no evidence of any kind here. Standing alone, B&D’s bare,

unparticularized allegations that Xing Te Hao could foresee its accused products making their way


a single 5-in-1 power tool at the August 2001 show. This power tool was located on a display
board among various power tool products but was not used or otherwise included as part of any
demonstration during the show. Unfortunately for B&D, mere attendance at a trade conference is
insufficient to assert specific jurisdiction. See Geodetic Services Inc. v. Metronor AS, 2000 WL
1027222, 55 U.S.P.Q.2d 1365, 1368 (M.D. Fla. 2000). Accordingly, this Court will not exercise
personal jurisdiction over a foreign defendant based on mere attendance at a trade show in the
forum.

In addition, although a “defendant who sends an agent into IlJinois to solicit or negotiate a
contract is transacting business within the statutory definition” and thus subject to personal
jurisdiction, see Scovil Mfg. Co. v. Dateline Elec. Co., 461 F.2d 897, 900 (7th Cir. 1972), I reject
B&D’s argument that this is such a situation here. The defendant in Scovil made at least seven
trips to Chicago over a three-year period where it had negotiations and post-contract discussions
with the plaintiff. Jd. at 898-900, Moreover, the contract that formed the basis of the suit was
allegedly breached by the defendant in Illinois. Jd. at 898. In this case, Xing Te Hao has been
present in Illinois only twice since 2001 and, unlike in Scovil, the facts do not demonstrate that
there were any sales, uses, or offers to sell the accused product in Illinois.

In relation to the second element of the HollyAnne test, B&D argues that its patent
infringement claim arises out of or relates to Xing Te Hao’s limited activities in Illinois on the
ground that: (1) bringing the 5-in-1 power tool to the 2001 National Hardware Show in Chicago
constituted “importation” of the infringing tool for use at the trade show pursuant to 35 U.S.C.
§271(a) and/or (2) displaying the 5-in-1 power tool at the same trade show constituted an “offer

for sale” of the infringing tool pursuant to 3D Systems, Inc. v. Aarotech Labs., Inc., 160 F.3d


In the meantime, Xing Te Hao’s Motion to Dismiss for Lack of Personal Jurisdiction is
ENTERED AND CONTINUED.

ENTER:

J) BEs

famgs B. Zagel ( 7
ited States Dis lige

pate: /3 ax C093



‘Minate Order Form (06/97)

United States District Court, Northern District of Illinois

Name of Assigned Judge Sitting Judge if Other
or Magistrate Judge James B. Zagel than Assigned Judge
CASE NUMBER 02 C 4615 DATE 6/13/2003
CASE BLACK & DECKER INC., ET AL vs. §.K. ENTERPRISES, ET AL
TITLE
{In the following box (a) indicate the party filing the motion, e.g., plaintifY, defendant, 3rd party plaintiff, and (b) state brielly the nature
MOTION: of the motion being presented.]
DOCKET ENTRY:
qd) o Filed motion of [ use listing in “Motion” box above.]
(2) o Brief in support of motion due
(3) o Answer brief to motion due. . Reply to answer brief due.
(4) o Ruling/Hearing on set for at
(5) oO Status hearing[held/continued to] [set for/re-set for] on set for at
(6) i) Pretrial conference[held/continued to] [set for/re-set for] on _setfor at
(7) o Trial{set for/re-set for] on _at
(8) Oo [Bench/Jury trial] [Hearing] held/continued to at
(9) i This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]
OFRCP4(m) O Local Rule 41.1 CFRCP41(a)(1) [1 FRCP41(a)(2).
qo [Other docket entry] Enter memorandum opinion and order granted leave to conduct
additional discovery.
a1) ff {For further detail see order attached to the original minute order.]

No notices required, advised in open court.
No notices required.

Notices mailed by judge’s staff.

Notified counsel by telephone

Docketing to mail notices.

Mail AO 450 form.

Copy to judge/magistrate judge

courtroom
deputy’s
initials

DW

yisia'sn
as)

€2:9 Rd SI NI EU

Lyne 19

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Document”
Number
number of notices

JUN 1-7 2063

Date/time received in

copia] igrit's Ofte] | -f

JUN 1 7 2603

dlare docketed

date mailed notice

mailing deputy initials



1373, 1379 (Fed. Cir. 1998). Regarding the first argument, simply bringing a product in the
United States for display at a trade show does not constitute importation under §271(a) absent
evidence that the corporation brought the particular product into the United States with the intent
to sell it. Creo Products Inc. v. Presstek, Inc., 166 F.Supp.2d 944, 976 (D. Del. 2001), aff’d, 305
F.3d 1337 (Fed. Cir. 2002); see also Cybiotronics, Ltd. v. Golden Source Electronics, Ltd., 130
F.Supp.2d 1152, 1176 (C.D. Cal. 2001) (refusing to find infringement under §271(a) for
“importing into the United States” where there was no evidence that foreign corporation
transmitted product samples for purposes of sale). Here, B&D has provided no evidence that
Xing Te Hao had any intent to sell the single 5-in-1 tool that it brought to Illinois. Regarding the
second argument, an “offer to sell” requires description of the product and a price at which it
could be purchased. 3D Systems, Inc., 160 F.3d at 1379.3 Here, B&D cannot point to any
evidence of product descriptions or price quotations by Xing Te Hao during its visit to Illinois, see
HollyAnne v. TFT, 199 F.3d 1304, 1309-10 (Fed. Cir. 1999), and merely displaying an accused
product, even in an obviously commercial atmosphere such as a trade show, does not, by itself,
constitute an offer to sell. See, e.g., Fluid Mgmt. Ltd. v. H.E.R.O. Indus., Ltd., No. 95 C 5604,
1997 WL 112839 (N.D. Ill. Mar. 11, 1997); Intermedics, Inc. v. Ventritex, Inc., 775 F.Supp. 1269,
1286 (N.D. Cal. 1991). Accordingly, nothing in the record supports that conclusion that Xing Te

Hao has offered to sell its accused product in Illinois.

> To constitute an offer, a communication must constitute an offer under the “norms of
traditional contractual analysis.” Rotec Indus., Inc. v. Mitsubishi Corp., 215 F.3d 1246, 1255
(Fed. Cir. 2000). Under traditional contract law, an offer communicates a “manifestation of
willingness to enter into a bargain, so made as to justify another person in understanding that his
assent to that bargain is invited and will conclude it.” Restatement (Second) of Contracts §24
(1979).



UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION
BLACK & DECKER INC. and BLACK &
DECKER (U.S.) INC.,
Plaintiffs,
No. 02 C 4615
v. Judge James B. Zagel
SHANGHAI XING TE HAO INDUSTRIAL
CO., LTD., S.K. ENTERPRISES, INC., and
QVC NETWORK, INC., —
PS aU
Defendants.
JUN 17 2003

MEMORANDUM OPINION AND ORDER

Black & Decker (“B&D”) has brought suit in the United States District Court for the
Northern District of Illinois against Shanghai Xing Te Hao Industrial Company, Ltd. (“Xing Te
Hao”) for patent infringement on the basis of selling its “Strategy 18 Volt Cordless 5-in-1
Combination Tool Kit” and its “5 Star 18 Volt Cordless Power Tool.” Xing Te Hao moves to
dismiss the complaint for lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure
12(b)(2).

B&D bears the burden of demonstrating the existence of personal jurisdiction. RAR, Inc.
v. Turner Diesel, Ltd., 107 F.3d 1272, 1276 (7th Cir, 1997).' Determining whether there is
jurisdiction over an out-of-state defendant involves a two-step inquiry: (1) whether the forum

state’s long arm statute permits service of process, and (2) whether the assertion of personal

' Although cases from the various jurisdictions are cited throughout this opinion, in a
patent infringement case, when determining whether jurisdiction over an out-of-state infringer is
consistent with due process, Federal Circuit precedent controls. See Akro Corp. v. Luker, 45

F.3d 1541, 1543 (Fed. Cir. 1995).


jurisdiction would violate due process, Pieczenik v. Dyax Corp., 265 F.3d 1329, 1333 (Fed. Cir.),
reh’g en banc den. (2001). The Illinois long arm statute is coextensive with federal due process
requirements. Klump v. Duffus, 71 F.3d 1368, 1371 (7th Cir. 1995). Thus, the two-step inquiry
folds into one: whether the exercise of personal jurisdiction over the defendant would offend
federal due process. See Red Wing Shoe Co., Inc. v. Hockerson-Halberstadt, Inc., 148 F.3d 1355,
1358 (Fed. Cir. 1998).

Personal jurisdiction is proper under federal due process only when the defendant has
“Minimum contacts” with the forum “such that the maintenance of the suit does not offend
traditional notions of fair play and substantial justice.” International Shoe Co. v. Washington, 326
US. 310, 316 (1945). Under “minimum contacts,” a defendant may be subject to either specific
jurisdiction or general jurisdiction. LSI Indus. Inc. v. Hubbell Lighting, Inc., 232 F.3d 1369, 1375
(Fed. Cir. 2000). For general jurisdiction, a defendant must have “continuous and systematic”
contacts with the forum. Helicopteros Nacionales de Colombia, S.A. y. Hall, 466 U.S. 408, 414-
16 (1984). Only when “continuous corporate activity within a state [is] thought so substantial and
of such a nature as to justify suit against it on causes of action arising from dealings entirely
distinct from those activities” may a Court assert general jurisdiction over a corporate defendant.
International Shoe, 326 US. at 318. Here, it is fairly obvious and B&D does not dispute that
Xing Te Hao’s contacts with Illinois are not sufficient enough to give rise to general jurisdiction.
In addition, Xing Te Hao’s aggregate contacts do not support nationwide personal jurisdiction
under the stream of commerce theory. See Beverly Hills Fan Co. v. Royal Sovereign Corp., 21

F.3d 1558 (Fed. Cir. 1994).