Larson v. SoundSkins Global

Background

Benjamin L. Larson alleged that SoundSkins Global, Compustar Australia Pty Ltd, and Mobile Marine & Car Audio LLC, doing business as Lakes Audio, directly infringed United States Patent 8,739,921. The patent covers a sealing, absorbing, and decoupling ring kit used in vehicle speaker systems. Larson alleged that the defendants sold, offered for sale, distributed, and advertised an infringing product in the United States.

Compustar’s motion

Compustar moved to dismiss under Federal Rule of Civil Procedure 12(b)(5) for insufficient service of process and, alternatively, under Rule 12(b)(2) for lack of personal jurisdiction. The court addressed only the service issue because it was dispositive.

Compustar is an Australian company. Larson’s attorneys communicated with Compustar’s United States-based trademark attorney, Ruth Khalsa, and later with Minnesota attorney Alan M. Anderson during settlement discussions. Both attorneys stated that they were not authorized to accept service for Compustar. Larson nevertheless attempted to serve them. The process server eventually handed the summons and complaint to Anderson through his secretary, and Anderson tore them up.

The court held that Larson had not provided prima facie evidence—that is, initial evidence sufficient to support his position—that service was proper. Under Rule 4, an attorney can accept service for a client only when expressly or implicitly authorized to do so. The court found no factual basis for such authorization and noted that both attorneys had repeatedly denied having it. The court also rejected Larson’s argument that actual notice of the lawsuit was enough. The court therefore granted Compustar’s motion under Rule 12(b)(5) and dismissed Larson’s complaint against Compustar without prejudice. The court did not address Compustar’s personal-jurisdiction argument.

Lakes Audio’s motion

Lakes Audio moved under Rule 12(b)(6) for failure to state a claim. It argued that Larson’s allegations of direct patent infringement were vague and conclusory.

The court explained that a complaint must allege enough facts to make a claim plausible, although a patent-infringement complaint need not establish every element of a patent claim in detail. The court found that Larson’s complaint identified the accused product by name, included a photograph of the product and its packaging, identified a representative patent claim, alleged that the accused products were made according to the steps in that claim, and identified additional patent claims allegedly infringed. The court held that these allegations placed Lakes Audio on notice of the alleged infringement and denied Lakes Audio’s motion to dismiss.

Attorney fees and costs

Compustar requested attorney fees and costs under 35 U.S.C. § 285, which permits fees to a prevailing party in an exceptional patent case. Compustar argued that Larson had failed to conduct a reasonable investigation before filing suit and continued to assert that service was proper despite statements to the contrary.

The court concluded that the record was limited because the case was at an early stage. Although the court stated that Larson’s service attempts were arguably not made in good faith, it found insufficient evidence to establish that Larson’s investigation or conduct made the case exceptional. The court denied Compustar’s request for attorney fees and costs.

Order

Judge Wilhelmina M. Wright ordered that Compustar’s motion to dismiss was granted; Larson’s complaint against Compustar was dismissed without prejudice; Lakes Audio’s motion to dismiss was denied; and Compustar’s request for attorney fees and costs was denied.