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E.I. du Pont de Nemours and Co. v. Agfa-Gavaert NV

United States District Court, D. Delaware

August 15, 2018

AGFA-GAVAERT NV, ET AL., Defendants.


          GOLDBERG, J.

         This patent infringement and breach of contract case arises from a business relationship gone awry. Plaintiff, E.I. du Pont de Nemours and Company (“DuPont”), has filed a Motion for a Temporary Restraining Order and Preliminary Injunction, requesting that I enjoin Defendants, Agfa-Gavaert NV (“the Parent”), Agfa Graphics NV (“the Belgian Subsidiary”), and Agfa Corporation (“the Delaware Subsidiary”) from affirmatively using certain materials in a pending patent proceeding in Germany. The Parent and Belgian Subsidiary, both based in Belgium, have filed a Motion to Dismiss pursuant to Federal Rule of Evidence 12(b)(2), contending that I do not have personal jurisdiction over them.

         For the reasons that follow, I will grant the Parent and Belgian Subsidiary's Motion to Dismiss and deny DuPont's Motion for a Temporary Restraining Order as moot.[1]


         Although multi-faceted, the dispute between the parties centers around several patents held by the Belgian Subsidiary, including the '759 Patent, which is the subject of this lawsuit.

         DuPont filed its original Complaint in the District of Delaware on November 3, 2017, and subsequently filed an Amended Complaint on November 17, 2017.[3] DuPont brings the following causes of action: declaratory judgment of invalidity of the '759 Patent (Count I); declaratory judgment of non-infringement of the '759 Patent (Count II); declaratory judgment of implied license of the '759 patent (Count III); declaratory judgment of equitable estoppel (Count IV); unfair competition claim under Section 43(A) of the Lanham Act, 15 U.S.C. § 1125 (Count V); declaratory judgment of patent exhaustion (Count VI); violation of Delaware Deceptive Trade Practices Act (Count VII); violation of Delaware Consumer Fraud Act (Count VIII); breach of contract and covenant of good faith and fair dealing (Count IX); copyright infringement (Count X); and breach of website terms of use (Count XI).

         DuPont filed its Motion for a Temporary Restraining Order and Preliminary Injunction on December 6, 2017. On January 24, 2018, the Parent and Belgian Subsidiary filed a Motion to Dismiss pursuant to Federal Rule of Evidence 12(b)(2).[4]

         A. The Parties

         DuPont, a corporation that is a wholly owned subsidiary of DowDuPont, Inc., manufactures and supplies Cyrel® Flexographic Printing Plates and Equipment. These plates look similar to large rubber stamps and are “used to print color images of flexible labels and packaging for hundreds of everyday items, including potato chip bags, frozen vegetable bags, milk cartons, candy bar wrappers, and cereal boxes.” DuPont offers a line of both digital and analog flexographic printing plates suitable for thermal development, as well as corresponding thermal development processing equipment under the trade name Cyrel® FAST. (Am. Compl. ¶¶ 1, 19.)

         “AGFA” is the collective name used by DuPont for the Parent, Belgian Subsidiary, and Delaware Subsidiary.[5] The Parent is a Belgian public limited company with its principal place of business in Mortsel, Belgium. DuPont alleges that it is the parent company to several “wholly owned agent-subsidiaries, ” through which it “centrally operates its Agfa Graphics Division.”[6]The Belgian Subsidiary, is a public limited company with its principal place of business in Mortsel, Belgium.[7] It is a wholly owned subsidiary of the Parent, and according to DuPont, operates as “part of, and with and under the dominion and control of [the Parent] and/or [Parent's] Graphics Division.” The Belgian Subsidiary is the assignee of European Patent No. 1170 121 B1, titled “Direct-to-plate flexographic printing plate precursor” (“the EP '121 patent”), the German Patent DE 600 00237 T2 (“the German Patent”), and United States Patent No. 6, 551, 759 (“the '759 Patent”).[8] Finally, the Delaware Subsidiary is a wholly owned subsidiary of the Parent organized under the laws of Delaware. DuPont alleges that the Delaware Subsidiary “operates as part of, and with and under the control of [the Parent] or [the Belgian Subsidiary], and/or AGFA Graphics Division.” (Id. ¶¶ 2, 4-6, 20-21.)

         B. Litigation History Between the Parties

         On March 25, 2003, DuPont challenged the EP '121 Patent through what is referred to as an “Opposition” in the European Patent Office (“the EPO”). On April 26, 2007, the Opposition Division of the EPO revoked the EP '121 Patent for insufficient disclosure. The Board of Appeals of the EPO set aside this decision on July 23, 2010 and referred it back to the Opposition Division. On February 1, 2017, the Opposition Division rejected DuPont's request that it revoke the reinstated EP '121 Patent. DuPont appealed this rejection on April 19, 2017 and was still waiting for a decision when it filed the Amended Complaint in this case. (Id. ¶ 22.) DuPont notified me by correspondence on June 1, 2018 that it had withdrawn its appeal in the EPO.

         In or about 2005, “AGFA, ” through the Belgian Subsidiary, informed DuPont of its position that some of DuPont's Cyrel® FAST flexographic printing plates and corresponding equipment infringed the EP '121 Patent in Europe and the '759 Patent in the United States. DuPont responded that the EP '121 Patent was invalid. DuPont and “AGFA” subsequently began negotiating for a license or sale of the '121 Patent and related patents, however, no agreement was reached and the parties suspended negotiations until the EP '121 Patent appeal was resolved before the EPO. (Id. ¶¶ 23-24.)

         DuPont alleges that beginning in 2011, DuPont and “AGFA, ” through the Delaware Subsidiary, entered into an initial distribution and marketing agreement (“the U.S. Agreement”), which was last renewed and signed in 2016. According to DuPont, the U.S. Agreement authorized “AGFA” as a marketer and distributor in the United States for certain DuPont Cyrel® flexographic plates and equipment. Pursuant to this agreement, “AGFA” agreed to promote, sell, and provide customer service for Cyrel® products. (Id. ¶¶ 27-31.)

         DuPont contends that pursuant to the U.S. Agreement, to facilitate the promotion, marketing, distribution, and related support for DuPont's Cyrel® products, DuPont authorized “AGFA” to provide DuPont's written, recorded, and/or digitally available materials to “AGFA's” contractually assigned Cyrel® customers and potential customers, under the following terms and conditions:

AGFA shall use information regarding the PRODUCTS provided by DuPont, including without limitation promotional and technical literature solely for purposes of performing its obligations hereunder, including but not limited to developing its marketing programs for the Products. AGFA shall make no claims, warranties, statements or representations with respect to the Products other than those set forth in product literature that is provided by DuPont.

         These materials included: all customer and authorized distributor accessible Cyrel® sales, marketing, promotional, technical, instructional, safety, product and process information; documents and/or presentations; documents titled “DuPont Cyrel DFR Data Sheet, ” which is the subject of U.S. Copyright Registration No. TX0008429562, and “DuPont Cyrel Fast Presentation, ” which is the subject of U.S. Copyright Registration No. TX0008427628; and “other copyright-protected all-rights-reserved materials” from the DuPont website. (Id. ¶¶ 31-34; id., Exs. D, M, N.)

         The U.S. Agreement originated from a distribution agreement entered into by DuPont and the Harold M. Pitman Company (“Pitman”) by which Pitman became a distributor of DuPont's plates. According to DuPont, “AGFA” purchased Pitman in 2010 and was assigned the distribution agreement as a result of its purchase of Pitman. (Pl.'s Resp. at 4.) Defendants contest this allegation, arguing it was the Delaware Subsidiary that acquired Pitman's assets in 2010, the Delaware Subsidiary that was transferred Pitman's distribution agreement with DuPont, and the Delaware Subsidiary that distributed DuPont's plates in the United States pursuant to the U.S. Agreement. (Defs.' Mot. at 1, 5.)

         DuPont alleges that on July 4, 2017, “AGFA, ” through the Belgian Subsidiary, filed a patent infringement lawsuit against DuPont in Regional Court in Dusseldorf, Germany. The complaint in Germany asserts that DuPont's Cyrel® FAST DFR plates infringe the German Patent. The crux of the current dispute and focus of DuPont's injunction request is that the German complaint and written evidence “rel[y] heavily on AGFA's unauthorized reproduction, distribution, and use of DuPont's copyright-protected and other all-rights reserved publications, technical and promotional literature, product-labels and plate-products.” (Am. Compl. ¶¶ 39, 41.)

         C. DuPont's Allegations Regarding Personal Jurisdiction Over the Parent and the Belgian Subsidiary

         The allegations contained in the Amended Complaint regarding personal jurisdiction over the Parent and the Belgian Subsidiary are:

[The Parent and Belgian Subsidiary, ] through their own dominion or control and actions and/or their agent-subsidiaries' dominion and control and actions, and/or their control and dominion of AGFA Graphics Division and instrumental use of their agent subsidiaries, . . . have aided or abetted each other in committing and/or directly or indirectly committed tortious, illegal or injurious acts, or otherwise have transacted business and contracted to supply services in Delaware within the scope of Delaware's long arm statute, 10 Del. C. § 3104. [The Parent and Belgian Subsidiary] ha[ve] minimum contacts with Delaware that relate directly to this controversy such that personal jurisdiction over them will not violate Constitutional due process, and it is fair and reasonable for this Court to assert personal jurisdiction over them.
Upon information and belief, by or through conduct, coordination, supervision or their dominion and control of the AGFA Graphics Division, [the Parent] and/or [the Belgian Subsidiary] have maintained systematic and continuous contacts with [the Parent]'s wholly owned subsidiary [the Delaware Subsidiary], a Delaware corporation. Upon information and belief, [the Parent] and/or [the Belgian Subsidiary] have exerted and continue to exercise dominion and control over [the Delaware Subsidiary], directing it, for example, to negotiate and sell or provide to DuPont its joint marketing, promotion, sales and distribution capabilities and services regarding the DuPont Cyrel® Products AGFA Agreement (see infra Ex. D).
Further, [the Parent and Belgian Subsidiary] ha[ve] committed, or ha[ve] aided and abetted each other in committing or causing tortious conduct directed at DuPont, a Delaware corporation, and thus this Court may exercise jurisdiction over AGFA-Europe for this additional reason[.]

(Id. ¶¶ 15-17.)


         The Parent and Belgian Subsidiary aver that the allegations in the Amended Complaint are conclusory and insufficient to demonstrate either specific or general personal jurisdiction. They urge that because I do not have personal jurisdiction over either of them, they should be dismissed from this case.

         In response to the Motion to Dismiss, DuPont requested jurisdictional discovery, which I granted. The parties engaged in the ordered jurisdictional discovery, and DuPont has now submitted numerous exhibits that it believes establish personal jurisdiction over the Parent and Belgian Subsidiary. I held oral argument on May 10, 2018 where DuPont further directed my attention to particular exhibits within its extensive submissions.

         The parties seem to agree that I must resolve the jurisdiction issue before addressing DuPont's Motion for a Temporary Restraining Order and Preliminary Injunction. Because “[a] district court cannot enjoin a party if it does not have jurisdiction over that party, ” I will address the Motion to Dismiss first. See Celgard, LLC v. LG Chem, Ltd., 624 Fed.Appx. 748, 751 (Fed. Cir. 2015).

         A. Legal Standard

         When reviewing a motion to dismiss for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2), the court must accept the plaintiff's allegations as true and resolve disputed facts in favor of the plaintiff. Pinker v. Roche Holdings Ltd., 292 F.3d 361, 368 (3d Cir. 2002). However, “[o]nce a jurisdictional defense has been raised, the plaintiff bears the burden of establishing with reasonable particularity that sufficient minimum contacts have occurred between the defendant and the forum state to support jurisdiction.” Bell Helicopter Textron, Inc. v. C & C Helicopter Sales, Inc., 295 F.Supp.2d 400, 403 (D. Del. 2002) (citing Provident Nat'l Bank v. California Federal Sav. & Loan Assoc., 819 F.2d 434, 437 (3d. Cir. 1987)). They may do so through sworn affidavits or other competent evidence. Parker v. Learn Skills Corp., 530 F.Supp.2d 661, 670 (D. Del. 2008) (citing Time Share Vacation Club v. Atlantic Resorts, Ltd., 735 F.3d 61, 66 n.9 (3d Cir. 1984)). A plaintiff “is required to respond to a Rule 12(b)(2) motion to dismiss for lack of personal jurisdiction with actual proof, not mere allegations.” Id.

         To meet this burden, DuPont must show that (1) the Delaware long-arm statute authorizes jurisdiction over the Parent and Belgian Subsidiary, and (2) the exercise of personal jurisdiction comports with constitutional Due Process. Nespresso USA, Inc. v. Ethical Coffee Co. SA, 263 F.Supp.3d 498, 502 (D. Del. 2017). The Delaware long-arm statute is construed broadly “to confer jurisdiction to the maximum extent possible under the Due Process Clause, ” thus DuPont need not put forward any additional evidence that the long-arm statute authorizes jurisdiction over the Parent and Belgian Subsidiary.[9] Id.

         As to the second requirement, “due process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Id. at 503 (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)). This “minimum contacts” doctrine can be met through a showing of “general jurisdiction” or “specific jurisdiction.” Id.

         “A court may assert general jurisdiction over foreign . . . corporations to hear any and all claims against them when their affiliations with the state are so ‘continuous and systematic' as to render them essentially at home in the forum State.” Daimler AG v. Bauman, 134 S.Ct. 746, 754 (2014) (quoting Int'l Shoe Co., 326 U.S. at 317).

         A corporation's “principal place of business” and state of incorporation are “paradigm” bases for finding general jurisdiction with respect to corporations. Id. at 760. However, other “substantial, continuous, and systematic” contacts with a forum state may form the basis for general jurisdiction if they are of such a nature and degree to render the defendant essentially at home in the forum State.” Id. at 761 (internal quotations and citation omitted).

         Specific jurisdiction refers to the authority to hear cases in which “the suit aris[es] out of or relate[s] to the defendant's contacts with the forum.” Helicopteros Nacionales de Columbia, S.A. v. Hall, 466 U.S. 408, 414 n.8 (1984). This type of personal jurisdiction exists where (1) “the defendant has ‘purposefully directed' his activities at residents of the forum, and (2) “the litigation results from alleged injuries that ‘arise out of or relate to' those activities.” Burger King v. Rudzewicz, 471 U.S. 462, 476 (1985) (citations omitted).

         Regarding the first step, the defendant must have “purposefully avail[ed] itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.” J. McIntyre Mach., Ltd. v. Nicastro, 131 S.Ct. 2780, 2788 (2011) (alteration in original) (quoting Hanson v. Denckla, 357 U.S. 235, 253 (1958)). “The placement of a product into the stream of commerce, without more, is not an act of the defendant purposefully directed toward the forum State.” Asahi Metal Indus. Co. v. Super. Ct. of Cal., 480 U.S. 102, 112 (1987)). Purposeful availment may be shown when an out-of-state defendant has set up offices in, pays taxes to or owns property in the forum state, and has sent employees to the forum state. See McIntyre, 131 S.Ct. at 2790. It can also be shown where an out-of-state defendant has registered to do business in the forum state or holds bank accounts in the forum state. See Goodyear, 131 S.Ct. at 2852.

         B. Analysis

         The Parent and Belgian Subsidiary maintain that the jurisdictional allegations in the Amended Complaint are conclusory and the subsequent information submitted by DuPont through briefing fails to supply the necessary facts to establish personal jurisdiction. They provide the following uncontested information in support of their position:

- The Parent and Belgian Subsidiary are both headquartered in Mortsel, Belgium;
- Neither the Parent nor the Belgian Subsidiary owns or leases any real estate in Delaware or anywhere else in the United States;
- The Parent is the parent company of almost 100 subsidiaries and “does not export any products into Delaware or elsewhere ...

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