Catalyst Inc. v. Empathy Catalyst Consulting

Background

Catalyst Inc. sued Empathy Catalyst Consulting over alleged trademark infringement and unfair competition under federal and state law. Catalyst alleged that Empathy Catalyst used the CATALYST mark in connection with consulting services and events in the United States and Canada. Catalyst also alleged that Empathy Catalyst had United States clients, including clients connected to California, and had hosted or advertised events in California.

Empathy Catalyst moved to dismiss for lack of personal jurisdiction and improper venue. Personal jurisdiction means the court’s authority to exercise power over a defendant. Empathy Catalyst argued that it had no connection to California. Its founder and principal, Alia Ali, stated that all of the company’s clients were Canadian and that Empathy Catalyst had never had a California client. Ali also denied that the company had hosted an event in Hermosa Beach or performed work for Big West Rotaract. Catalyst responded with screenshots from Empathy Catalyst’s website and social-media accounts.

Legal standard

The court described the Ninth Circuit’s three-part test for specific personal jurisdiction over a nonresident defendant: the defendant must purposefully direct activities toward California or purposefully conduct business there; the claim must arise from or relate to those activities; and exercising jurisdiction must be reasonable. The plaintiff bears the burden on the first two requirements. If the plaintiff satisfies them, the defendant must present a compelling case that jurisdiction would be unreasonable.

The court also explained that jurisdictional discovery should ordinarily be allowed when facts relevant to jurisdiction are disputed or when further factual development may establish a basis for jurisdiction.

Ruling

The court found that the record was insufficiently developed to resolve personal jurisdiction and that further discovery might establish facts supporting jurisdiction. It therefore GRANTED Catalyst’s request to take jurisdictional discovery and DEFERRED ruling on Empathy Catalyst’s pending motion to dismiss until the discovery was completed and the parties filed supplemental briefs regarding jurisdiction.

The court VACATED the January 17, 2025 hearing. It directed the parties to meet and confer about deadlines for jurisdictional discovery and supplemental briefs. By January 24, 2025, they were required either to file a stipulation on those matters or to submit a case-management statement with competing timelines; the court would address the timing at the January 31, 2025 initial case-management conference.