Slack Technologies, Inc. v. Phoji, Inc.

Background

Slack Technologies, Inc. filed a lawsuit asking for a declaration that it did not infringe Phoji, Inc.’s ’149 patent. Phoji moved to dismiss under Federal Rule of Civil Procedure 12(b)(2), arguing that the court lacked personal jurisdiction over it. Slack also asked for discovery about jurisdictional facts.

The opinion states that Phoji is based in Minneapolis, Minnesota, and Slack is based in San Francisco, California. Beginning in 2019, Phoji sent Slack letters and other communications asserting that Slack infringed the ’149 patent and discussing possible licensing, damages, and potential litigation. The parties exchanged more than a dozen communications before Slack filed its complaint.

Slack also alleged that Phoji had other California contacts, including distributing its mobile app through Google and Apple, participating in a San Francisco marketing conference, appearing in an interview connected to a California-based company, using advertisements mentioning California locations, and sending its chief executive officer to California for business. Phoji submitted a declaration disputing some of these allegations, including the alleged January 2020 business trip.

Personal Jurisdiction

The court applied Federal Circuit law to the substantive personal-jurisdiction question because the case involved patent law. Because California’s long-arm statute reaches as far as due process permits, the court treated the statutory and constitutional inquiries as one question.

Slack relied only on specific jurisdiction, which concerns whether the defendant’s forum-related conduct is connected to the particular lawsuit. The court applied a three-part test: whether Phoji purposefully directed activities at California residents, whether Slack’s claim arose from or related to those activities, and whether exercising jurisdiction would be reasonable and fair.

The court concluded that Phoji’s communications accusing Slack of infringement satisfied the first two parts of the test. However, Federal Circuit precedent generally requires more than infringement or cease-and-desist letters in a patent declaratory-judgment case. The additional activities must be purposefully directed at the forum and materially related to enforcing or defending the patent.

The court rejected Phoji’s argument that its communications could not count because they did not always expressly threaten litigation. The court found that Phoji clearly accused Slack of infringement, that at least one letter expressly referred to litigation, and that other communications did so implicitly.

The court nevertheless held that the communications to Slack were not enough by themselves to establish specific jurisdiction. It distinguished a Federal Circuit decision involving enforcement efforts against multiple entities in the forum, explaining that Slack’s case did not involve similar facts.

Other Alleged Activities

The court held that Slack had not shown that Phoji’s relationships with Google Play and the Apple App Store imposed continuing obligations on Phoji to enforce or defend the ’149 patent. The court also concluded that Slack had not shown how Phoji’s marketing conference, interview, sample social-media posts, or alleged business trip related to patent enforcement or defense. At most, the court characterized those activities as commercialization efforts, which do not establish the required connection to patent enforcement or defense.

Jurisdictional Discovery and Disposition

The court exercised its discretion to deny Slack’s request for jurisdictional discovery. It reasoned that Slack had not made the required showing that additional discovery would produce facts establishing jurisdiction. The court also stated that information about product distribution in California would amount to a fishing expedition because commercialization of the patented product was not the required enforcement-related activity.

The court granted Phoji’s motion to dismiss for lack of personal jurisdiction and denied Slack’s request for jurisdictional discovery. It directed the clerk to enter final judgment and close the file. The order states that it disposed of Docket No. 21.