Opinion
Case No. 03 C 6460.
April 16, 2004
MEMORANDUM OPINION AND ORDER
Recycling Sciences International, Inc. (RSI) has sued Four Seasons Environmental, Inc, TDX Associates, McLaren/Hart, Inc., and Industrial Recovery Systems International, Inc., for patent infringement. IR Systems has moved to dismiss RSI's claims for lack of personal jurisdiction. For the reasons stated below, the Court grants IR System's motion.
Facts
RSI, which is based in Illinois, has sued IR Systems for patent infringement. IR Systems, a Delaware corporation based in North Carolina, is a soil and process waste remediation company. The alleged infringement involves IR Systems' alleged use of a thermal desorption process to remediate contaminated soil in Illinois, a process for which RSI claims to hold patents.
RSI has the burden of establishing a prima facie case of personal jurisdiction over the defendant. Purdue Research Found v. Sanofi-Synthelabo, S.A., 338 F.3d 773, 783 (7th Cir. 2003). In determining whether a plaintiff has made the necessary showing, a court may consider affidavits and exhibits submitted by the parties. Turnock v. Cope, 816 F.2d 332, 333 (7th Cir. 1987). The facts alleged in the complaint are taken as true unless controverted by the affidavits or evidence submitted by the defendant. Saylor v. Dyniewski, 836 F.2d 341, 342 (7th Cir. 1988). Conflicts in the parties' affidavits are resolved in the plaintiff's favor. RAR, Inc. v. Turner Diesel, Ltd., 107 F.3d 1272, 1275 (7th Cir. 1997). In this case, only defendant IR Systems submitted an affidavit, from its President Thaddeus Kuzniar. RSI has made no effort to controvert Kuzniar's affidavit, so we take his assertions as true.
According to Kuzniar, IR Systems has never had a place of business, employees, facilities, phone numbers, addresses, or bank accounts in Illinois. The company is not licensed to do business in Illinois and does not transact any business here. No equipment owned by IR Systems has been used, maintained, leased, or otherwise placed in Illinois for soil remediation purposes. IR Systems has never registered to do business in Illinois and does not have an agent appointed for service of process in this state. IR Systems has never advertised or sold any products or services here. It has never paid taxes in Illinois and has no shareholders residing in Illinois. See Kuzniar Decl. ¶¶ 2-7.
IR Systems' primary alleged connection with Illinois is through its Web site and through McLaren/Hart, a bankrupt company from which IR Systems bought equipment in 2000. Kuzniar Decl. ¶ 9. IR Systems' Web site contains a section entitled "Case Histories" which lists two Illinois projects, one in Lincolnwood and one in Batavia. See Pltf. Mem., Ex. 1. Kuzniar states in his affidavit, however, that IR Systems was not involved in either project and that the projects were listed simply to illustrate the capabilities of the technology that the company uses to remediate contaminated soil. Kuzniar Decl. ¶ 10. Kuzniar states that IR Systems has never used, leased, or placed any equipment in Illinois for any purpose. Id. ¶ 11. As noted earlier, RSI has offered no evidence to contradict Kuzniar's statements.
Discussion
Before a court may exercise personal jurisdiction over an out-of-state defendant, the defendant must be amenable to service in the forum state, and the court's exercise of personal jurisdiction over the defendant must comport with federal due process requirements. LSI Indus, Inc. v. Hubbell Lighting, Inc., 232 F.3d 1369, 1371 (Fed. Cir. 2000). Because Illinois permits service of process to the extent permitted by due process, see 735 ILCS 5/2-209(c), the due process inquiry is determinative of IR Systems' motion. RAR, 107 F.3d at 1276.
Due process permits a court to exercise personal jurisdiction over a defendant only if it has certain "minimum contacts" with the state "such that [it] should reasonably anticipate being haled into court there." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980); Int'l Shoe Co. v. Washington, 326 U.S. 310, 320 (1945). Once these minimum contacts are found, they are considered along with other factors to ascertain whether personal jurisdiction over the defendant would comport with tradition notions of "fair play and substantial justice." Int'l Shoe, 326 U.S. at 320.
There are two types of jurisdiction: general and specific. General jurisdiction can be asserted only if the defendant is domiciled in the forum state or "when the defendant maintains `continuous and systematic' contacts with the forum state even when the cause of action has no relation to those contacts." Helicopteros Nacionales de Columbia S.A. v. Hall, 466 U.S. 408, 414-16 (1984). Specific jurisdiction can be asserted when the cause of action "arises out of" or "relates to" the defendant's contacts with the forum state, even if the defendant's contacts with the state have been "isolated and sporadic." Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472-73 (1985).
IR Systems does not have the "continuous and systematic" contacts with Illinois needed to give this Court general jurisdiction. Based on the record before the Court, IR Systems does not and has not maintained offices, owned real estate, employed residents, paid taxes, conducted business, advertised or sold products in this state. It has done nothing to actively procure business from Illinois, and it has not done business here with any degree of permanence or continuity. See Michael J. Neuman Assocs. v. Florabelle Flowers, 15 F.3d 721, 724 (7th Cir. 1994) (a corporation is doing business in a state if it operates within the state, not occasionally or casually, but with a fair measure of permanence and continuity.)
The fact that IR Systems has a Web site available to Illinois (and other states') residents does not provide the contacts necessary to establish general jurisdiction. IR Systems' Web site is a "passive" site; in other words, it simply provides information and does not allow a user to exchange information with IR Systems. Though the law regarding how an entity's maintenance of a Web site affects the general jurisdiction inquiry is as yet unclear, see, e.g., Lakin v. Prudential Securities, 348 F.3d 704, 711 (8th Cir. 2003) (citing cases), IR Systems cites no authority for the proposition that the mere maintenance of a passive Web site is sufficient to confer general jurisdiction over an entity that otherwise has no significant contacts with the forum state. In addition, IR Systems has made no effort to quantify the frequency with which Illinois residents have accessed IR Systems' site. Without such information, the Court has no basis to conclude that this particular Web site has resulted in the type of systematic contacts needed to confer general jurisdiction.
Specific jurisdiction is likewise lacking. RSI alleges in its complaint that IR Systems has used the patented technology to remediate soil in Illinois, but this allegation is squarely controverted by Kuzniar's affidavit, and RSI has offered nothing to contradict that affidavit. Under the circumstances, RSI cannot rely on its unsupported allegation as a basis for personal jurisdiction.
RSI also argues that IR Systems' Web site constitutes an offer to sell patented technology within the meaning of 35 U.S.C. § 271(a) and that because the site is accessible from Illinois it provides a basis for specific jurisdiction. But RSI has offered no evidence that the Web site lists the price for using the purportedly patented system or even a description of that system, which is what is required for an "offer to sell" to exist. See 3D Systems v. Aarotech Lab., 160 F.3d 1373, 1379 (Fed. Cir. 1998) (a 35 U.S.C. § 271(a) "offer to sell" occurs when a defendant provides potential buyers with both a description of the product and a purchase price); see generally, Engate, Inc. v. Esquire Deposition Services, LLC, No. 01 C 6204, 2003 WL 22117805, at *8-11 (N.D. Ill. Sept. 10, 2003). And there is no indication that IR Systems Web site in any way targets Illinois for business. It takes a more focused means of advertising to create the basis for specific jurisdiction. Compare Logan Prods. v. Optibase, Inc., 103 F.3d 49, 53 (7th Cir. 1996) (advertisement in a national trade magazine, newsletters to forum state residents, and distributor based in the state all evinced an intent to intentionally serve the forum state's market, thus, establishing minimum contacts). The mere existence of a passive Web site like that maintained by IR Systems is insufficient. See, e.g., Lakin, 348 F.3d at 710. Consequently, specific jurisdiction is lacking.
Conclusion
For the reasons stated above, the Court grants defendant IR System's motion to dismiss for lack of personal jurisdiction [docket #8-1].