Blockchange Ventures I GP, LLC v. Blockchange, Inc.

Background

Blockchange Ventures I GP, LLC brought seven causes of action against Blockchange, Inc. The claims included trademark infringement and dilution, unfair competition, and deceptive acts under the Lanham Act, common law, and New York General Business Law §§ 349, 350, and 360-L.

Blockchange, Inc. moved to dismiss under Federal Rule of Civil Procedure 12(b)(4) for insufficient process, Rule 12(b)(6) for failure to state a claim, Rule 12(b)(2) for lack of personal jurisdiction, and Rule 12(b)(3) for improper venue.

Service of Process

The court held that Blockchange Ventures had not properly served Blockchange, Inc. The original summons was neither signed nor sealed. Although the plaintiff later filed a signed version, the court found that the plaintiff still had not served the defendant with that signed summons.

Personal Jurisdiction

The court also held that the plaintiff had not made the required preliminary showing for personal jurisdiction under New York Civil Practice Law and Rules § 302(a)(1). That provision allows jurisdiction over a defendant that transacts business in New York or contracts to supply goods or services there.

The plaintiff relied on the defendant’s website, its use of cookies, and an alleged partnership with Gemini Trust Company, LLC, which the opinion identifies as a New York corporation. The defendant submitted sworn testimony disputing that it had a partnership with Gemini. The court stated that, even if the partnership existed, the plaintiff had not shown that its claims arose from that partnership. The court also found that the website’s accessibility in New York and its use of cookies, without more, were insufficient to establish that the defendant transacted business in New York.

Venue

The court found that venue was improper under 28 U.S.C. § 1391. The website’s accessibility in New York and its use of cookies did not establish that a substantial proportion of the events underlying the claims occurred in the Southern District of New York. The court noted the absence of proof of other activities in the district.

Disposition

Because the court lacked personal jurisdiction and venue was improper, it did not reach Blockchange, Inc.’s Rule 12(b)(6) argument. Judge Alvin K. Hellerstein dismissed the case without prejudice for insufficient service of process, lack of personal jurisdiction, and improper venue. The court also cancelled the scheduled oral argument and directed the Clerk to terminate the civil case and the open motions.