GENETIC VETERINARY SCIENCES, INC., DBA PAW PRINTS GENETICS, Plaintiff-Appellee
LABOKLIN GMBH & CO. KG, THE UNIVERSITY OF BERN, Defendants-Appellants
Opinion Issued: July 29, 2019
from the United States District Court for the Eastern
District of Virginia in No. 2:17-cv-00108-HCM-DEM, Senior
Judge Henry C. Morgan, Jr.
P. Walters, Lowe Graham Jones PLLC, Seattle, WA, argued for
Johanna Wilbert, Quarles & Brady, LLP, Milwaukee, WI,
argued for defendants-appellants. Also represented by Michael
Piery; Nikia L. Gray, Washington, DC.
Wallach, Hughes, and Stoll, Circuit Judges.
WALLACH, CIRCUIT JUDGE.
Genetic Veterinary Sciences, Inc., d/b/a Paw Prints Genetics
("PPG") sued Appellants LABOKLIN GmbH & Co. KG
("LABOKLIN") and the University of Bern ("the
University") (together, "Appellants") in the
U.S. District Court for the Eastern District of Virginia
("District Court"), seeking a declaratory judgment
that claims 1-3 ("Asserted Claims") of the
University's U.S. Patent No. 9, 157, 114 ("the
'114 patent") are patent-ineligible under 35 U.S.C.
§ 101 (2012). J.A. 50-57 (Complaint). Appellants filed a
motion to dismiss the Complaint for, inter alia, lack of
subject-matter jurisdiction and lack of personal
jurisdiction, see J.A. 58-60, which the District
Court denied, see J.A. 302-16 (Order). Following the
close of the parties' evidence during a jury trial but
before submitting the case to the jury, the District Court
granted PPG's motion for judgment as a matter of law
("JMOL") and held the Asserted Claims
patent-ineligible under § 101. See Genetic
Veterinary Scis., Inc. v. LABOKLIN GmbH & Co., KG,
314 F.Supp.3d 727, 728 (E.D. Va. 2018), appeal
dismissed, No. 18-1625, 2018 WL 6334978 (4th Cir. June
5, 2018); see also J.A. 1 (Final Judgment).
appeal the District Court's conclusions as to
jurisdiction and patent-ineligibility. We have jurisdiction
pursuant to 28 U.S.C. § 1295(a)(1) (2012). We affirm.
University is the owner of the '114 patent and an agent
or instrumentality of the Swiss Confederation, "having a
place of business in Bern, Switzerland." J.A. 1090. In
2013, the University granted an exclusive license of its
'114 patent to the German company LABOKLIN, J.A. 1091,
whose "principal place of business is in Bad Kissingen,
Germany," J.A. 1090; see J.A. 173-218
(Confidential License Agreement). Among many conditions of
the License Agreement, LABOKLIN was required to commercialize
the invention in North America "within [a specific time
period] of the Effective date." J.A. 214-15.
Subsequently, and at the time of the filing of
Appellants' Motion to Dismiss, LABOKLIN had entered into
two sublicenses in the United States. See J.A. 309,
349-51 (referencing California and Michigan sublicensees).
The License Agreement required both LABOKLIN and the
University to obtain the other's consent prior to sending
any cease-and-desist letter to a potential infringer. J.A.
217. The License Agreement further stated that if the
infringing activity "d[oes] not abate within [a specific
time period]" and the University gives LABOKLIN written
notice of its election not to bring suit, LABOKLIN has a
right to sue for infringement. J.A. 218.
a corporation headquartered in the State of Washington . J.A
. 302 . It offer s laboratory services for testing for
genetic variations and mutations known to cause certain
diseases in dogs, including a test for "detect[ing] the
presence of a mutation in the SUV39H2 gene." J.A. 302.
Relevant to the facts of this case, PPG would accept a
customer's request to test sample DNA received "from
all over the world" and once the DNA test was concluded,
would send the results back to the customer. See
J.A. 101-02, 68.
January 2017, after obtaining the University's consent to
send PPG a cease-and-desist letter, see J.A. 312,
349, 353, counsel for LABOKLIN sent a cease-and-desist letter
to PPG at its business location in Spokane, Washington,
see J.A. 99-104. The cease-and-desist letter
explained that "[LABOKLIN] is the exclusive license
holder of [the '114 patent]," J.A. 100, as well as
the exclusive licensee of the related European and German
patents, see J.A. 99, all of which were attached as
enclosures, and the letter stated that given "[PPG]
make[s] use of the patent as defined in above-mentioned
patent claim 1[, ] . . . you [PPG] have committed an act of
patent infringement," J.A. 102. After receiving the
cease-and-desist letter, PPG brought suit against both
LABOKLIN and the University, requesting declaratory judgment
that the Asserted Claims of the '114 patent are
ineligible under § 101 for failing to claim
patent-eligible subject matter, and ultimately asserting that
PPG therefore cannot be liable for infringing the Asserted
Claims. See J.A. 50-57.
and the University moved to dismiss the Complaint under,
inter alia, Federal Rules of Civil Procedure 12(b)(1) for
lack of subject-matter jurisdiction and 12(b)(2) for lack of
personal jurisdiction. J.A. 35. Following an evidentiary
hearing, the District Court issued its Order finding
jurisdiction established over both LABOKLIN and the
University. See J.A. 302-16. First, applying Federal
Rule of Civil Procedure 4(k)(2), and considering the
cease-and-desist letter and LABOKLIN's licensing
activities in the United States, the District Court held that
it may exercise personal jurisdiction over LABOKLIN because
LABOKLIN had sufficient minimum contacts with the United
States to comport with due process. J.A. 310; see
Fed. R. Civ. P. 4(k)(2) (explaining how personal jurisdiction
is established for a federal claim outside state-court
jurisdiction). Second, the District Court held that
jurisdiction was established over the University as a foreign
sovereign in the United States because, inter alia, the
University had engaged in "commercial activity"
sufficient to trigger an exception to jurisdictional immunity
under 28 U.S.C. § 1605(a)(2) by "obtain[ing] a
patent and then threaten[ing] PPG by proxy with
litigation." J.A. 314.
subsequently asserted counterclaims for infringement of the
'114 patent, J.A. 317-28; however, PPG stipulated to
infringement of the Asserted Claims, and the only issue that
proceeded to trial was PPG's invalidity defense, J.A.
1088, 1089-116 (containing, in a draft final pretrial order,
the stipulated facts of both parties). Following the close of
both parties' evidence at trial but before submitting the
case to the jury, the District Court granted PPG's Motion
for JMOL and held the Asserted Claims patent-ineligible under
§ 101. See Genetic Veterinary, 314 F.Supp.3d at
728. This appeal followed.
aver that the District Court: (1) "lacks personal
jurisdiction over LABOKLIN" because LABOKLIN lacks
sufficient contacts with the forum; and (2) "lacks
personal and subject[-]matter jurisdiction over the
University because the University enjoys sovereign
immunity." Appellants' Br. 16. We address each issue
Personal Jurisdiction Over LABOKLIN
Standard of Review and Legal Standards
jurisdiction is a question of law that we review de
novo." Autogenomics, Inc. v. Oxford Gene Tech.
Ltd., 566 F.3d 1012, 1016 (Fed. Cir. 2009) (citation
omitted). We apply Federal Circuit law to questions of
personal jurisdiction because the issue "is intimately
involved with the substance of the patent laws."
Grober v. Mako Prods., Inc., 686 F.3d 1335,
1345 (Fed. Cir. 2012) (internal quotation marks and citation
omitted); see Hildebrand v. Steck Mfg. Co., 279 F.3d
1351, 1354 (Fed. Cir. 2002) (applying Federal Circuit law to
determinations of personal jurisdiction over out-of-state
defendant-patentees in patent infringement cases and
declaratory judgment cases). Where the district court's
disposition as to personal jurisdiction is based on
affidavits and other written materials in the absence of an
evidentiary hearing, a plaintiff need only make a prima facie
showing that defendants are subject to personal jurisdiction.
See Elecs. For Imaging, Inc. v. Coyle, 340 F.3d
1344, 1349 (Fed. Cir. 2003). Where discovery is conducted,
however, the plaintiff bears the burden of proving by a
preponderance of the evidence the facts necessary to
establish personal jurisdiction over the defendant.
Pieczenik v. Dyax Corp., 265 F.3d 1329, 1334 (Fed.
Cir. 2001). We review any underlying factual findings for
clear error. Grober, 686 F.3d at 1345. A factual
finding is "clearly erroneous" only when the entire
record leaves the reviewing court "with the definite and
firm conviction that a mistake has been committed."
Anderson v. City of Bessemer City, 470 U.S. 564,
Rule of Civil Procedure 4(k)(2) states, in relevant part:
"For a claim that arises under federal law, serving a
summons . . . establishes personal jurisdiction over a
defendant if: (A) the defendant is not subject to
jurisdiction in any state's courts of general
jurisdiction; and (B) exercising jurisdiction is consistent
with the United States Constitution and laws."
Fed.R.Civ.P. 4(k)(2). In applying and interpreting Rule
4(k)(2), we therefore allow a court to exercise personal
jurisdiction over a nonresident if: "(1) the
plaintiff's claim arises under federal law, (2) the
defendant is not subject to jurisdiction in any state's
courts of general jurisdiction, and (3) the exercise of
jurisdiction comports with due process." Synthes
(U.S.A.) v. G.M. Dos Reis Jr. Ind. Com de Equip. Medico,
563 F.3d 1285, 1293-94 (Fed. Cir. 2009).
assertion of jurisdiction to comport with due process, a
nonresident defendant must have "certain minimum
contacts with [the forum] such that the maintenance of the
suit does not offend traditional notions of fair play and
substantial justice." Int'l Shoe Co. v.
Washington, 326 U.S. 310, 316 (1945) (internal quotation
marks and citation omitted). Relevant here, "if Rule
4(k)(2) supplies the due process analysis, then the forum is
the United States," "as opposed to the state in
which the district court sits [i.e. Virginia]."
Synthes (U.S.A.), 563 F.3d at 1291, 1295.
summarized the Supreme Court's due process jurisprudence
for specific personal jurisdiction as a three-part test:
"(1) whether the defendant purposefully directed its
activities at residents of the forum; (2) whether the claim
arises out of or relates to the defendant's activities
with the forum; and (3) whether assertion of personal
jurisdiction is reasonable and fair." Inamed Corp.
v. Kuzmak, 249 F.3d 1356, 1360 (Fed. Cir. 2001)
(internal quotation marks and citation omitted). "The
first two factors correspond with the 'minimum
contacts' prong of the [International Shoe]
analysis, and the third factor corresponds with the 'fair
play and substantial justice' prong of the
analysis." Id. "We have consistently
rejected attempts to satisfy the defendant-focused
'minimum contacts' inquiry by demonstrating contacts
between the plaintiff (or third parties) and the forum
State." Walden, 571 U.S. at 284.
to the third factor regarding whether assertion of personal
jurisdiction is "reasonable and fair,"
"[w]here a defendant who purposefully has directed his
activities at forum residents seeks to defeat jurisdiction,
he must present a compelling case that the presence of some
other considerations would render jurisdiction
unreasonable." Burger King Corp. v. Rudzewicz,
471 U.S. 462, 476 (1985) (emphasis added). In Burger
King, the Supreme Court identified five considerations
relevant to the reasonableness inquiry:
[C]ourts in "appropriate case[s]" may evaluate 
"the burden on the defendant,"  "the forum
State's interest in adjudicating the dispute," 
"the plaintiff's interest in obtaining convenient
and effective relief,"  "the interstate judicial
system's interest in obtaining the most efficient
resolution of controversies," and  the "shared
interest of the several States in furthering fundamental
substantive social policies."
Id. at 477 (second alteration in original) (quoting
WorldWide Volkswagen Corp. v. Woodson, 444 U.S. 286,
District Court Had ...