Guangzhou Shanshui Tongxun Shebei Youxian Gongsi, et al. v. Phone Lasso, LLC

Background

The plaintiffs are Guangzhou Shanshui Tongxun Shebei Youxian Gongsi, HK Sanli Trading Co., Limited, Hongkong Yuanhong Et Limited, Shen Zhen Shi Ma Si Ka Ke Ji You Xian Gong Si, and Shenzhen Shi Shun Xing Tong Ke Ji You Xian Gong Si. The opinion describes them as companies based in Mainland China and Hong Kong that sell cell-phone accessories, including phone lanyards, through Amazon.com’s marketplace.

Phone Lasso initiated an Amazon Patent Evaluation Express proceeding in April 2025, accusing the plaintiffs’ phone lanyards of infringing U.S. Patent No. 8,523,031. The opinion explains that Amazon’s APEX program allows a patent owner or licensee to notify Amazon of possible infringement by a marketplace seller. If infringement appears likely, Amazon may remove the accused products from its listings. The plaintiffs’ complaint asserted claims for a declaration that they did not infringe the patent, unfair competition under California law, and tortious interference with economic relations.

Personal Jurisdiction

Phone Lasso moved to dismiss under Federal Rule of Civil Procedure 12(b)(2), arguing that the California court lacked personal jurisdiction. Personal jurisdiction means the court’s authority to exercise power over the defendant. The plaintiffs did not claim that California had general jurisdiction over Phone Lasso; they relied on specific jurisdiction, which can exist when the defendant’s forum-related conduct is sufficiently connected to the claims.

The plaintiffs argued that Phone Lasso’s APEX complaint was aimed at removing their Amazon listings and disrupting sales in California. They relied particularly on SnapPower v. Lighting Defense Group, in which the Federal Circuit found that an APEX complaint was purposefully directed at a Utah company located in Utah. The court distinguished that decision because the plaintiffs here were based in Mainland China and Hong Kong, not California. In the court’s view, the possibility that sales to California customers could be affected did not itself show that Phone Lasso purposefully directed its conduct toward California.

The court also considered Phone Lasso’s evidence that it was organized under North Carolina law, had its principal place of business and sole corporate office in Raleigh, North Carolina, and had no employees or physical presence in California. Phone Lasso also presented unrebutted evidence that it had not conducted the relevant patent-enforcement activities in California, entered into an exclusive patent license with a California resident, pursued earlier patent enforcement in California, or communicated a patent-enforcement threat to or within California.

The court concluded that the plaintiffs had not made the required initial showing that Phone Lasso purposefully directed its activities toward California. Because the plaintiffs failed that first requirement, the court did not decide whether their claims arose from Phone Lasso’s forum-related activities or whether exercising jurisdiction would be fair and reasonable.

Transfer

After finding that it lacked personal jurisdiction, the court considered whether to dismiss the case or transfer it under 28 U.S.C. § 1631. The court determined that transfer was in the interest of justice. The parties disagreed about the destination: the plaintiffs proposed the Western District of Washington, while Phone Lasso proposed the Eastern District of North Carolina.

The court selected the Eastern District of North Carolina, where Phone Lasso is located. It rejected the plaintiffs’ reliance on a forum-selection provision in the APEX agreement because the provision applied only to disputes under that agreement. The court also noted a Washington federal court’s decision finding no personal jurisdiction in a related type of APEX dispute.

Disposition

The court concluded that it lacked personal jurisdiction over Phone Lasso and transferred the case to the United States District Court for the Eastern District of North Carolina. It did not reach Phone Lasso’s arguments that venue in California was improper or that the plaintiffs failed to state a tortious-interference claim.