Chief Judge Sleet Finds Personal Jurisdiction Over Declaratory Judgment Defendant Lacking, Grants Motion to Dismiss

Chief Judge Sleet recently granted a patent infringement defendant’s motion to dismiss for lack of personal jurisdiction given the defendant’s lack of sufficient contacts with Delaware. See Liqui-Box Corp. v. Scholle Corp., C.A. No. 12-464-GMS, Memorandum Op. at 1 (D. Del. June 17, 2013). The declaratory judgment defendant, Scholle, is a Nevada corporation with headquarters in California. One of the operating subsidiaries of Scholle, Scholle Packaging, is a Nevada corporation with primary operations in Illinois and headquarters in California. Of the two declaratory judgment plaintiffs, Liqui-Box Corp. and Liqui-Box Inc., one is an Ohio incorporated and based corporation and the other is a Delaware corporation with operations primarily in Texas. After Scholle sent a letter to Liqui-Box in Ohio alleging infringement of its patents, Liqui-Box filed a declaratory judgment action in the District of Delaware. The same day, Scholle filed an infringement action against Liqui-Box in the Northern District of Illinois. Id. 2.

Judge Sleet first found that the exercise of jurisdiction under Delaware’s long-arm statute was inappropriate, rejecting arguments that Scholle had sufficient direct contacts with Delaware and that the actions of Scholle’s subsidiary should be attributed to Scholle under an alter ego theory or an agency theory. Id. at 5-11. As part of this analysis, Judge Sleet emphasized that “the relevant inquiry for specific personal jurisdiction purposes is ‘to what extent . . . the defendant patentee purposefully directed such enforcement activities at residents of the forum, and the extent to which the declaratory judgment claim arises out of or relates to those activities.’” Because sales in Delaware were not “‘enforcement activities’ that might allow for specific jurisdiction in the declaratory judgment context,” found that the case did not fall under the specific jurisdiction or general jurisdiction provisions of the long-arm statute. Id.

Liqui-Box Corp. v. Scholle Corp., C.A. No. 12-464-GMS, Memorandum Op. (D. Del. June 17, 2013).

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