Yangtze Memory Technologies, Inc. v. Strand Consult

Background

Yangtze Memory Technologies Company, Ltd. and Yangtze Memory Technologies, Inc. sued Strand Consult and Roslyn Layton. They later filed an amended complaint that added DCI Group AZ, L.L.C. and asserted claims under the Lanham Act, 15 U.S.C. § 1125(a). The amended complaint alleged that the defendants operated the China Tech Threat website and published false, misleading, and disparaging statements about Yangtze Memory Technologies and its products.

The defendants moved to dismiss under Federal Rules of Civil Procedure 12(b)(1), 12(b)(2), 12(b)(6), and 9(b). Their arguments included lack of subject-matter jurisdiction, lack of Article III and statutory standing, lack of personal jurisdiction over DCI, and failure to plausibly allege Lanham Act claims. The court did not reach those alternative arguments concerning the claims’ sufficiency.

Personal jurisdiction over DCI

The court held that the plaintiffs did not adequately show that DCI had purposefully directed conduct toward California or that the claims arose from DCI’s California-related activities. The plaintiffs alleged that DCI funded China Tech Threat and authored false statements about Yangtze Memory Technologies. But the court found that a single article about Apple, a website tagline referring to all Americans, and alleged use of California-based internet infrastructure did not establish that DCI expressly aimed the website at California. The plaintiffs also did not adequately connect DCI to the internet infrastructure or identify facts showing that DCI’s own actions caused or anticipated harm specifically in California.

The court therefore dismissed the plaintiffs’ claims against DCI without leave to amend.

Personal jurisdiction over Strand Consult and Roslyn Layton

The court determined that Roslyn Layton was domiciled in Denmark based on her declaration that she had lived there since 2010, intended to remain there, lived there with her family, and worked from Denmark. The court analyzed personal jurisdiction over Strand Consult and Layton under Federal Rule of Civil Procedure 4(k)(2), which can allow jurisdiction over defendants who are not subject to jurisdiction in any state when the claims arise under federal law and nationwide contacts satisfy due process.

The court found that the plaintiffs established only that Strand Consult and Layton intentionally operated the China Tech Threat website and wrote articles published there. The court concluded that the passive website, its English-language content, its intended United States audience, its use of United States content-delivery networks, and its “.com” address did not provide the additional conduct directly targeting the United States that was required. The plaintiffs also did not adequately allege that their claims arose from the defendants’ United States-related activities. In particular, the allegations focused on harm to Yangtze Memory Technologies, which is based in China, without adequately connecting the alleged harm to Yangtze Memory Technologies, Inc. or to the United States.

The court dismissed the claims against Strand Consult and Layton with leave to amend. The plaintiffs were permitted to file a second amended complaint by June 10, 2025, alleging specific facts showing purposeful direction toward the forum and that their claims arose from the defendants’ forum-related activities.

Other requests and disposition

The court denied jurisdictional discovery because the plaintiffs had not shown more than a speculative basis that discovery would establish personal jurisdiction. The court also declined to rule on the defendants’ requests for judicial notice because it had not relied on the requested materials.

The court granted the defendants’ motion to dismiss based on lack of personal jurisdiction over DCI without leave to amend, and with leave to amend as to Strand Consult and Layton. Judge Noél Wise did not decide the alternative arguments concerning subject-matter jurisdiction, standing, failure to state a claim, or the pleading requirements under Rule 9(b).