Zero filed for declaratory relief against Pirelli seeking to
protect its use of ZERO and ZERO-formative marks. Zero makes electric motorcycles under the
ZERO MOTORCYCLES mark in many foreign countries, since 2007. It has US registrations for ZERO on electric
vehicles, namely motorcycles, as well as ZERO MOTORCYLES, ZERO DS, ZERO S, ZERO
SS, ZERO X and ZERO MX. Pirelli makes various products, including tires for
vehicles, and owns a number of trademarks which incorporate the ZERO mark. (There are a number of Pirelli companies; the
one that conducts business in California is Pirelli Tire LLC.)
Zero alleged that Pirelli began a global campaign against
Zero’s trademark registrations in 2009, filing oppositions and cancellations in
the USPTO and elsewhere, and that Pirelli submitted a declaration of use and
incontestability claiming that the ZERO mark was in use in the US. Its exemplar was marketing material showing a
tire with the P ZERO mark, which Zero alleged was false because the exemplar
was for P ZERO, not ZERO.
Zero sought to join the US subsidiaries, a motion the court
denied because of undue delay. In
addition, the new claims Zero sought to assert didn’t work. Zero wanted to add a Lanham Act disparagement
claim; it was unclear whether the disparagement was of Zero’s products or of
its marks, but no claim for trademark disparagement exists under the Lanham
Act. The allegedly false assertions were
that Pirelli has used a Zero mark identical to Zero’s mark and that Pirelli
swore that Zero was confusing and diluting Pirelli’s marks. But these misstatements were made to the PTO,
not in commercial advertising or promotion. Moreover, they related to Zero’s
marks, not to its goods or services (what about its commercial activities?).
The California UCL claim failed; it was too conclusory, and
Zero didn’t allege facts showing a willful intent to provide false testimony to
the PTO, which would have been “unlawful.”
Pirelli allegedly lied about its use of the Zero mark, but it provided
the exemplar using P ZERO, and the fact that it submitted that exemplar “undermines
any assertion of a willful intent to deceive the PTO, since the PTO obviously
could assess the accuracy of Defendants' representation by comparing it to the
exemplar.” Likewise Zero failed to plead
unfairness; Pirelli “did little more” than seek to protect its IP rights.
More interesting, perhaps, was the court’s ruling on
personal jurisdiction over the non-US defendants. After finding no general
jurisdiction, the court analyzed whether their alleged attempts to harm Zero’s
marks created specific jurisdiction. In
the 9th Circuit, specific jurisdiction requires purposeful direction
to the forum/resident or purposeful availment of the forum; the claim must
arise out of or relate to those forum-related activities; and the exercise of
jurisdiction must comport with fair play and substantial justice. Satisfying the first two prongs shifts the
burden to the defendant to show that the exercise of jurisdiction would be
unreasonable.
Purposeful direction applies to tort claims. This means an intentional act, expressly
aimed at the forum state, causing harm the defendant knows is likely to be
suffered in the forum state. A merely
foreseeable effect in the forum state is generally insufficient. Though Pirelli’s acts were intentional and
may have had effects in California, the court found no express aiming. Instead, Pirelli allegedly aimed its
activities at the PTO, in DC. (Compare
the Second Circuit on copyright infringement.)
Another case found that a letter sent to a Virginia domain
name registrar challenging plaintiff's use of a particular domain name was
expressly aimed at California because it individually targeted the plaintiff, a
California corporation doing business almost exclusively in California. But Zero is a Delaware corporation doing
business worldwide. Thus, Pirelli’s
conduct didn’t individually target Zero in California with the intention of
disrupting its California business.
Likewise, Indianapolis Colts, Inc. v. Metropolitan Baltimore
Football Club Ltd. Partnership, 34 F.3d 410 (7th Cir.1994), was no help. In that case, the only activity the Baltimore
defendant had planned in Indiana was broadcast of its football games, which
were going to be shown nationwide. But the court concluded that the plaintiff’s
trademarks would be affected in Indiana, making jurisdiction proper. The Ninth Circuit has rejected that expansive
reading of Supreme Court precedent, refusing to hold that a foreign act with
foreseeable effects in the forum state always gives rise to specific
jurisdiction. More is required: specific
aiming at the forum.
Likewise, Zero’s claim didn’t arise out of Pirelli’s
forum-related activities: there was no showing that but for Pirelli’s
forum-related conduct, the injury wouldn’t have occurred. The conduct at issue here took place outside
of and was not related to California.
Even if Zero had succeeded on the first two prongs, the court found that
exercising jurisdiction would be unreasonable in this case, because defendants
are Italian entities that have no reason to be in California. They purposefully availed themselves of the
benefits of DC through proceedings before the PTO, and can be sued there.
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