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Government Employees Insurance Co. v. Whitserve LLC

United States District Court, D. Maryland, Southern Division

March 7, 2017



          Paul W. Grimm United States District Judge

         In an April 22, 2016 letter addressed to Plaintiff Government Employees Insurance Company (“GEICO”)'s General Counsel, Dana Proulx, Defendant WhitServe LLC (“WhitServe”) accused GEICO of infringing two of its patents by sending automated emails to customers inviting them to renew their insurance policies. Letter from Daniel R. Ferri, Niro Law, to Dana Proulx, General Counsel, GEICO Corp. 1 & attach. (Apr. 22, 2016), Compl. Ex. C., ECF No. 1-3.[1] WhitServe offered to license the patents at issue to GEICO. Id. at 1-2. Rather than respond to the letter, GEICO filed a Complaint in this Court seeking a declaratory judgment that it had not infringed WhitServe's patents. Compl. ¶¶ 28-29, 35-36. WhitServe filed the instant Motion to Dismiss, in which it argues that this Court lacks personal jurisdiction over the company. ECF No. 19. The Motion is fully briefed. Def.'s Mem., ECF No. 19-1; Pl.'s Opp'n, ECF No. 24; Def.'s Reply, ECF No. 25. Because I find that WhitServe has not engaged in any activities covered by Maryland's long-arm statute, the Court lacks personal jurisdiction, and I will therefore grant WhitServe's Motion.

         Standard of Review

         When a defendant challenges this Court's personal jurisdiction under Fed.R.Civ.P. 12(b)(2), the jurisdictional question “is to be resolved by the judge, with the burden on the plaintiff ultimately to prove grounds for jurisdiction by a preponderance of the evidence.” Fyfe Co., LLC v. Structural Grp., LLC, No. CCB-13-176, 2013 WL 2370497, at *2 (D. Md. May 30, 2012) (quoting Carefirst of Md., Inc. v. Carefirst Pregnancy Ctrs., Inc., 334 F.3d 390, 396 (4th Cir. 2003)). If the Court considers the operative Complaint and the parties' briefings but does not conduct an evidentiary hearing, then “the burden on the plaintiff is simply to make a prima facie showing of a sufficient jurisdictional basis in order to survive the jurisdictional challenge.” In re Celotex Corp., 124 F.3d 619, 628 (4th Cir. 1997) (quoting Combs v. Bakker, 886 F.2d 673, 676 (4th Cir.1989)); see also Consulting Eng'rs Corp. v. Geometric Ltd., 561 F.3d 273, 276 (4th Cir. 2009)). This is the approach I will take. I “must construe all relevant pleading allegations in the light most favorable to the plaintiff, assume credibility, and draw the most favorable inferences for the existence of jurisdiction.” Fyfe, 2013 WL 2370497, at *2 (quoting Mylan Labs., Inc. v. Akzo, N.V., 2 F.3d 56, 62 (4th Cir. 1993) (citation and quotation marks omitted)); see also Mitrano v. Hawes, 377 F.3d 402, 406 (4th Cir. 2004). Yet, I “need not ‘credit conclusory allegations or draw farfetched inferences.' ” Tharp v. Colao, No. WDQ-11-3202, 2012 WL 1999484, at *1 (D. Md. June 1, 2012) (quoting Masselli & Lane, PC v. Miller & Schuh, PA, No. 99-2440, 2000 WL 691100, at *1 (4th Cir. May 30, 2000)).


         Under Fed.R.Civ.P. 4(k)(1)(A), a federal court may exercise personal jurisdiction over a nonresident defendant such as WhitServe if (1) doing so comports with the Fourteenth Amendment's due process requirements; and (2) jurisdiction is authorized by the forum state's long-arm statute. Carefirst of Maryland, Inc. v. Carefirst Pregnancy Ctrs., Inc., 334 F.3d 390, 396 (4th Cir. 2003). Maryland's long-arm statute authorizes the exercise of personal jurisdiction over a corporate defendant that is neither served in Maryland nor organized under its laws and that does not maintain its principal place of business in Maryland, if the corporation:

(1) Transacts any business or performs any character of work or service in the State;
(2) Contracts to supply goods, food, services, or manufactured products in the State;
(3) Causes tortious injury in the State by an act or omission in the State;
(4) Causes tortious injury in the State or outside of the State by an act or omission outside the State if he regularly does or solicits business, engages in any other persistent course of conduct in the State or derives substantial revenue from goods, food, services, or manufactured products used or consumed in the State;
(5) Has an interest in, uses, or possesses real property in the State; or
(6) Contracts to insure . . . any person, property, risk, contract . . . located, executed, or to be performed within the State at the time the contract is made, unless the parties otherwise provide in writing.

Md. Code Ann., Cts. & Jud. Proc. § 6-103(b); see also Id. 6-103(a); Tawney v. AC & R Insulation Co., No. WDQ-13-1194, 2013 WL 5887625, at *2 (D. Md. Oct.30, 2013); Metro. Reg'l Info. Sys., Inc. v. Am. Home Realty Network, Inc., 888 F.Supp.2d 691, 699 (D. Md. 2012).

         Maryland courts have provided somewhat confusing guidance on the degree to which Maryland's long-arm statute approaches the jurisdictional ceiling set by the Due Process Clause. On the one hand, Maryland courts have held that the long-arm statute “is coextensive with the limits of personal jurisdiction set by the due process clause of the Federal Constitution, ” meaning that the statutory inquiry “merges with [the] constitutional examination.” Perdue Foods LLC v. BRF S.A., 814 F.3d 185, 188 (4th Cir. 2016) (quoting Beyond Sys., Inc. v. Realtime Gaming Holding Co., LLC, 878 A.2d 567 (Md. 2005)). On the other hand, Maryland courts also have cautioned that this overlap does not permit courts to “dispense with analysis under the long-arm statute, ” Mackey v. Compass Mktg., Inc., 892 A.2d 479, 493 n.6 (Md. 2006), and this Court has noted that “there may be cases where personal jurisdiction is proper under constitutional due process but not under Maryland's long-arm statute, ” Sigalia v. ABR of VA, Inc., 145 F.Supp.3d 486, 490 (D. Md. 2015). The courts have harmonized these apparently contradictory holdings by clarifying that each individual prong of the long-arm statute should be interpreted “to the limits permitted by the Due Process Clause when [courts] can do so consistently with the canons of statutory construction.” Mackey, 892 A.2d at 493 n.6; see also Joseph M. Coleman & Assocs., Ltd. v. Colonial Metals, 887 F.Supp. 116, 118 (D. Md. 1995) (“[T]o the extent a ...

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