Kevin Barry Fine Art Associates v. Ken Gangbar Studio, Inc.

Background

Kevin Barry Fine Art Associates (KBFAA) filed the action seeking a declaration of non-infringement. Ken Gangbar Studio, Inc. (KGSI) answered and asserted counterclaims against KBFAA and other parties for copyright infringement, conspiracy to violate the Racketeer Influenced and Corrupt Organizations Act, and substantive violations of that Act. KGSI later amended its counterclaims to add Marriott International, Inc. (Marriott) and Design Force Corporation (Design Force), among others.

KGSI alleged that the defendants participated in a scheme involving counterfeit copies of artworks by Ken Gangbar, whose works KGSI alleged it owned the copyrights to. As to Marriott and Design Force, KGSI alleged that Design Force selected allegedly infringing artwork for display at the JW Marriott hotel near Minneapolis, Minnesota, and that Marriott recommended KBFAA to Design Force. KGSI also alleged that Marriott and Design Force were responsible for or benefited from the selection and display of the artwork.

Motions and Legal Standard

Marriott and Design Force moved to dismiss for lack of personal jurisdiction and improper venue. The court considered personal jurisdiction first. Personal jurisdiction is the court’s power to exercise authority over a particular defendant. KGSI had the burden of showing facts supporting that power.

The court explained that personal jurisdiction may be general or specific. General jurisdiction requires affiliations with California so continuous and systematic that the company is essentially at home there. Specific jurisdiction requires the defendant’s own purposeful contacts with California, a claim arising from or related to those contacts, and an exercise of jurisdiction that is reasonable.

Marriott

The court found no general jurisdiction over Marriott. Marriott was incorporated in Delaware and headquartered in Maryland. Although Marriott’s portfolio included properties in California, Marriott owned only ten properties, none in California, and many of the portfolio properties were franchised or licensed but owned and managed by other entities. The court also found that evidence that Marriott had been involved in eighty actions in the Northern District of California did not establish general jurisdiction because the evidence did not explain Marriott’s role in those cases, when they occurred, or whether they involved California incidents.

The court also found no specific jurisdiction. Because copyright infringement is treated as a tort for this analysis, the court applied a test asking whether Marriott intentionally acted, expressly aimed its conduct at California, and caused harm it knew was likely to occur in California. The court held that Marriott’s alleged recommendation of KBFAA did not establish the required California contact. The allegedly infringing artwork was selected for and displayed at the Minnesota hotel, and KGSI’s argument relied on KBFAA’s California contacts rather than Marriott’s own contacts.

The court rejected KGSI’s contention that its allegations also involved the Bayview Marriott in Newport Beach, California. The second amended counterclaims linked that location to Host Hotels and CHC Bayview, not Marriott International, Inc. The court also stated that KGSI could not rely on the Marriott name to connect Marriott to the property, particularly given the separate ownership and management structure and KGSI’s failure to directly allege that Marriott owned or managed the property.

The court concluded that KGSI could not amend its pleading in good faith to cure the jurisdictional problem. It therefore granted Marriott’s motion to dismiss without leave to amend.

Design Force

The court likewise found insufficient California contacts for Design Force. KGSI’s allegations concerning Design Force involved work on the JW Marriott hotel in Minnesota. KGSI again relied on KBFAA’s California contacts rather than contacts that Design Force itself had with California.

The court rejected KGSI’s attempt to distinguish the Supreme Court’s decision in Walden v. Fiore. The court explained that the jurisdictional inquiry must focus on the defendant’s contacts with the forum state itself, not merely the defendant’s contacts with people or companies located there. Design Force’s work on the Minnesota hotel was insufficient to establish California jurisdiction, and KGSI did not dispute Design Force’s jurisdictional evidence or request jurisdictional discovery.

The court concluded that the pleading could not be cured by alleging additional facts and granted Design Force’s motion to dismiss without leave to amend.

Disposition

The court granted Marriott’s and Design Force’s motions to dismiss for lack of personal jurisdiction without leave to amend. It directed the clerk to terminate both parties from the action. The dismissal was without prejudice to KGSI’s ability to pursue its claims in another district where personal jurisdiction exists.