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Automated Facilities Management Corporation v. Smartware Group, Inc.

United States District Court, First Circuit

October 22, 2013

Automated Facilities Management Corporation
v.
Smartware Group, Inc., et al. No. 2013 DNH 138

MEMORANDUM AND ORDER

Automated Facilities Management Corporation (“AFMC”), the exclusive licensee for United States Patent Nos. 7, 548, 970 and 7, 606, 919 (the “‘970 Patent” and “‘919 Patent, ” respectively), has sued Smartware Group, Inc., for patent infringement. Smartware has responded with a counterclaim against AFMC and a third-party complaint against Tangopoint, Inc., seeking a declaratory judgment of non-infringement and patent invalidity against both defendants. Tangopoint moves to dismiss the third-party complaint pursuant to Federal Rule of Civil Procedure 12(b)(2), claiming that the court lacks personal jurisdiction. For the reasons set forth below, I grant Tangopoint’s motion to dismiss.

I.

II. BACKGROUND

AFMC is a Texas corporation and wholly owned subsidiary of Acacia Research Corporation (“ARC”), a patent licensing company. Doc. No. 2. As a patent licensing company, ARC directs its subsidiaries to partner with patent owners, license patents, and share resulting revenues.

Tangopoint, a Delaware corporation with its principle place of business in Nebraska, is the owner of the two patents in question. In January 2007, Tangopoint entered into an “Exclusive Licensing Agreement” (“Agreement”) concerning the two patents with Acacia Patent Acquisition Corporation (“APAC”), a subsidiary of ARC. APAC then assigned its interest in the patents to its subsidiary, AFMC.

Smartware is a New Hampshire software corporation with its principle place of business in New Hampshire. Smartware focuses its business on maintenance software, including “Bigfoot, ” a computerized maintenance management software (“CMMS”) package.

A. The Exclusive Licensing Agreement

The Agreement between Tangopoint, as owner of the patents, and AFMC, as licensee, purports to grant AFMC a worldwide exclusive license, including the exclusive right to grant sublicenses, to sue for and collect past, present, and future damages, and to seek injunctive relief in cases of patent infringement. Doc. No. 18-1. Tangopoint expressly retains the right to a percentage of all royalties that AFMC obtains from licenses or enforcement efforts, a limited right to terminate the Agreement, and a limited right to use the patents in its own products. Id.

B. Procedural Background

Pursuant to its rights under the Agreement, AFMC brought suit in this district against Smartware for patent infringement, claiming that Smartware’s Bigfoot software infringes Patents ‘919 and ‘970. Doc. No. 1. Smartware responded with several affirmative defenses, including non-infringement and invalidity. Doc. No. 8. It also brought a counterclaim against AFMC and a third-party complaint against Tangopoint seeking a declaratory judgment of non-infringement and invalidity. Id.

Smartware argues in its third-party complaint that this court has personal jurisdiction over Tangopoint in part because “Tangopoint knew, or should have known, that its licensing of the [patents] would subject it to counterclaims of patent invalidity in jurisdictions in which AFMC brought suit against alleged infringers.” Id. It further asserts that Tangopoint “purposely availed itself of the privilege of conducting activities within the State of New Hampshire” because AFMC brought suit in this district to enforce the patent and Tangopoint authorized the suit when it entered into the Agreement. Id. Smartware does not claim that Tangopoint has any other contacts with New Hampshire.

III. ANALYSIS

A. Personal Jurisdiction

The analysis of a personal jurisdiction claim in federal court begins with Rule 4 of the Federal Rules of Civil Procedure. Merial Ltd. v. Cipla Ltd., 681 F.3d 1283, 1293 (Fed. Cir. 2012). If a defendant is amenable to suit under Rule 4, personal jurisdiction exists unless the defendant lacks sufficient “minimum contacts” with the forum to satisfy the requirements of due ...


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