Society for Human Resource Management v. Zrowth LLC
- Vince Chhabria
- 3:21-cv-07684
- U.S. District Court · Northern District of California
- 2
Society for Human Resource Management v. Zrowth LLC: Judge Chhabria denied default judgment because the plaintiff did not establish personal jurisdiction over Zrowth.
Society for Human Resource Management must provide additional facts supporting personal jurisdiction over Zrowth LLC or face dismissal of the complaint and closure of the case.
What happened
In Society for Human Resource Management v. Zrowth LLC, the court considered the plaintiff’s request for a judgment against Zrowth after Zrowth did not defend the case.
The plaintiff relied on allegations that Zrowth had an office in California, conducted business there, and operated a website accessible to California residents. The court said those allegations did not establish general jurisdiction and did not show that Zrowth specifically targeted California through its website.
Judge Chhabria denied the motion for default judgment. He ordered the plaintiff to file an amended complaint and an affidavit explaining the basis for personal jurisdiction within 28 days. If the plaintiff does not do so, or does not establish jurisdiction, the complaint will be dismissed for lack of personal jurisdiction and the case will be closed.
The detailed version
- Society for Human Resource Management v. Zrowth LLC · No. 3:21-cv-07684
- Vince Chhabria
- Apr. 18, 2022
Background
Society for Human Resource Management sued Zrowth LLC over alleged trademark infringement and moved for default judgment. The court stated that it could not enter a default judgment unless it had jurisdiction over both the subject matter and the parties. The plaintiff had the burden to establish personal jurisdiction over Zrowth.
The complaint described Zrowth as a Wyoming limited liability company with its principal place of business in Wyoming. To support jurisdiction in California, the plaintiff pointed to allegations that Zrowth had an office in California, transacted business in and from California, and maintained a website accessible to California residents that advertised, promoted, and sold the allegedly infringing products and services.
Personal Jurisdiction Analysis
The court held that these allegations were insufficient to establish general jurisdiction. General jurisdiction ordinarily requires a defendant to be essentially at home in the forum state, and the allegations did not establish that California was Zrowth’s home for jurisdictional purposes.
The court then addressed specific jurisdiction. Because the claims sounded in tort, including the trademark claims alleged in the complaint, the Ninth Circuit’s purposeful-direction test applied. That test requires an intentional act, conduct expressly aimed at the forum state, and harm the defendant knows is likely to occur in the forum state.
The court found that the complaint alleged intentional trademark-infringement acts but did not allege that those acts were expressly aimed at California. A passive website is not enough merely because people in the state can access it. The plaintiff also did not identify facts showing that Zrowth directly targeted California through the website, such as appealing to and profiting from a specific California audience.
Order
The court denied the plaintiff’s motion for default judgment. It ordered the plaintiff, within 28 days, to file an amended complaint and an accompanying affidavit demonstrating the basis for personal jurisdiction. The court stated that if the plaintiff failed to file those materials within 28 days, or failed to meet its burden to establish jurisdiction over Zrowth, the complaint would be dismissed for lack of personal jurisdiction and the case would be closed.
The order was issued by United States District Judge Vince Chhabria and dated April 18, 2022.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.