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Bell v. Halcyon Business Publications, Inc.

United States District Court, S.D. Indiana, Indianapolis Division

May 24, 2018

RICHARD N. BELL, Plaintiff,
v.
HALCYON BUSINESS PUBLICATIONS, INC., Defendant.

          ORDER GRANTING DEFENDANT'S MOTION TO DISMISS FOR LACK OF JURISDICTION

          SARAH EVANS BARKER, JUDGE United States District Court Southern District of Indiana

         This cause is before the Court on Defendant's Motion to Dismiss for Lack of Jurisdiction [Docket No. 16], filed on December 29, 2017, pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure. Plaintiff Richard N. Bell has brought his claim against Defendant Halcyon Business Publications, Inc. (“Halcyon”), alleging that Halcyon committed copyright infringement when it allegedly downloaded and posted on its website a photograph of the Indianapolis skyline (“Indianapolis Photo”) taken by Mr. Bell.[1] Halcyon contends that this court lacks personal jurisdiction over it and seeks dismissal. For the reasons detailed below, we GRANT Defendant's Motion to Dismiss.

         Factual Background

         Mr. Bell, an Indiana resident, filed his complaint in this action on November 29, 2017, alleging copyright infringement and violations of the Lanham Act. Specifically, Mr. Bell alleges that Halcyon displayed on its website the Indianapolis Photo without his permission and added a copyright notice to its site falsely indicating that Halcyon owns the rights to the Indianapolis Photo.

         Halcyon is a for-profit limited corporation organized under the laws of New York with its principal place of business in Westbury, New York. Dennis Shea owns Halcyon and is a resident of Westbury, New York. Halcyon publishes Area Development magazine, which is a publication covering corporate site selection and relocation throughout the United States. Halcyon also operates a website which displays postings regarding cities around the country, including Indianapolis. Halcyon does not maintain any offices in Indiana, has no employees in Indiana, holds no assets located in Indiana, pays no taxes to the State of Indiana, and has no bank or other financial institution accounts in Indiana. Likewise, Mr. Shea, the principal officer of Halcyon, has never lived in Indiana, does not have an Indiana driver's license or a bank account in Indiana, and has never paid taxes to the State of Indiana.

         Halcyon acknowledges that, between 2011 and 2017, it paid one Indiana resident, Steve Stackhouse-Kaelble, to write for Area Development as an independent contractor.[2] Halcyon did not, however, pay Mr. Stackhouse-Kelble to write the article that contained the Indianapolis Photo. Halcyon also sold advertising to two Indiana companies between 2011 and 2017, which advertisements represented 3.26% and 4.55% of Halcyon's total online and magazine revenues in 2016 and 2017, respectively. Of the 34, 701 total unpaid subscribers of Area Development magazine nationwide, 1, 056 are from Indiana, comprising 3% of total subscribers. The record before us reveals that Halcyon has no other connections with Indiana.[3]

         Legal Analysis

         I. Applicable Law

         Federal Rule of Civil Procedure 12(b)(2) requires dismissal of a claim where personal jurisdiction is lacking. When “[a] defendant moves to dismiss the complaint under Federal Rule of Civil Procedure 12(b)(2) for lack of personal jurisdiction, the plaintiff bears the burden of demonstrating the existence of jurisdiction.” Purdue Research Found. v. Sanofi-Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir. 2003). When, as here, a district court rules on a defendant's motion to dismiss based on the submission of written materials, the plaintiff “need only make out a prima facie case of personal jurisdiction” and “is entitled to the resolution in its favor of all disputes concerning relevant facts presented in the record.” Id. (internal citations omitted).

         In order to properly exercise personal jurisdiction over a non-resident defendant, the court must undertake and satisfy a two-step analysis. First, the court must determine whether its exercise of jurisdiction over the defendant comports with the forum's long-arm statute. Assuming the first step is satisfied, the court must then determine whether this exercise is authorized by the Due Process Clause of the Constitution. See Felland v. Clifton, 682 F.3d 665, 672 (7th Cir. 2012). Because Indiana's long-arm statute “reduce[s] analysis of personal jurisdiction to the issue of whether the exercise of personal jurisdiction is consistent with the [f]ederal Due Process Clause, ” we need only discuss the second step of this analysis. LinkAmerica Corp. v. Cox, 857 N.E.2d 961, 967 (Ind. 2006); Ind. Trial R. 4.4(a).

         Due process subjects a defendant to personal jurisdiction in a particular state only if the defendant has “certain minimum contacts with [that state] such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.'” Mobile Anesthesiologists Chi., LLC v. Anesthesia Assocs. of Hous. Metroplex, P.A., 623 F.3d 440, 443 (7th Cir. 2010) (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)). A defendant's “minimum contacts” with the forum state must involve its “purposeful[ ] avail[ment] … of the privilege of conducting activities within the forum [s]tate, thus invoking the benefits and protections of its laws.” Asahi Metal Indus. Co. v. Super. Ct. of Cal., 480 U.S. 102, 109 (1987) (citation omitted). The requirement of purposeful availment allows potential defendants to reasonably anticipate conduct for which they may be haled into court in a foreign jurisdiction. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985).

         Personal jurisdiction may be either specific or general. The exercise of specific jurisdiction over a particular defendant is proper if the cause of action “is related to or ‘arises out of' [the] defendant's contacts with the forum … [such] that a ‘relationship among the defendant, the forum, and the litigation” exists. Helicoptores Nacionales de Colom., S.A. v. Hall, 466 U.S. 408, 414 (1984) (quoting Shaffer v. Heitner, 433 U.S. 186, 204 (1977)). By contrast, the Constitution places a “considerably more stringent” restriction on a court's exercise of general jurisdiction. Purdue Research Found., 338 F.3d at 787 (citing United States v. Swiss Am. Bank, Ltd., 274 F.3d 610, 619 (1st Cir. 2001)). General jurisdiction over a particular defendant exists only “when the [party's] affiliations with the State in which suit is brought are so constant and pervasive ‘as to render [i]t essentially at home in the forum State.'” Daimler AG v. Bauman, 571 U.S. 117, 121 (2014) (quoting Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011)). “These contacts must be so extensive to be tantamount to [the defendant] being constructively present in the state to such a degree that it would be fundamentally fair to require it to answer in an Indiana court in any litigation arising out of any transaction or occurrence taking place anywhere in the world.” Purdue Research Found., 338 F.3d at 787. In other words, where such continuous and systematic contacts are present, the court may exercise jurisdiction over the defendant regardless of the subject matter of the lawsuit. Hyatt Int'l Corp. v. Coco, 302 F.3d 707, 713 (7th Cir. 2002).

         II. Discussion

         Mr. Bell maintains that, by virtue of its contacts with Indiana, Halcyon is subject to both general and specific jurisdiction in the state. We disagree. First, with regard to general jurisdiction, it is clear that Halcyon does not have the requisite “continuous and systematic contacts” with Indiana that would render it “essentially at home” here as is required for the exercise of general jurisdiction. See Goodyear, 564 U.S. at 919. Mr. Bell attempts to support general jurisdiction over Halcyon with a one-sentence assertion, to wit, that “each year, ” the company has “‘continuous and systematic contacts' with more than 4, 000 [ ] Hoosier residents.” Pl.'s Resp. at 6. However, Mr. Bell fails to cite any evidence to support this number of claimed contacts with Indiana or expand in any way on this conclusory assertion. The Seventh Circuit has recognized that in cases like this where the defendant is neither incorporated in nor has its principal place of business in the forum state, the exercise of general jurisdiction requires “more than the ‘substantial, continuous, and systematic course of business' that was once thought to suffice.” Kipp v. Ski Enterprise Corp. of Wis., Inc., 783 F.3d 695, 698 (7th Cir. 2015) (citing Daimler, 571 U.S. at 136-39). Thus, ...


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