Shenzhen OKT Lighting Co., Ltd. v. JLC-TECH LLC

Background

Shenzhen OKT Lighting Co., Ltd. brought claims seeking declarations that JLC-TECH LLC’s U.S. Patent No. 10,508,805 was not infringed, invalid, and unenforceable. The dispute concerned competing overhead LED lighting products. JLC-TECH had sued Shenzhen in an earlier related proceeding in the Eastern District of Pennsylvania concerning a different patent, and JLC-TECH later sued another Shenzhen customer in the District of Maryland concerning the patent at issue here.

Shenzhen alleged that JLC-TECH had business relationships with two New York representatives, attended three New York lighting trade shows, sold products in New York, and sent a January 2020 patent infringement letter to Arlee Lighting, a Shenzhen customer. JLC-TECH moved to dismiss the First Amended Complaint for lack of personal jurisdiction and improper venue under Federal Rules of Civil Procedure 12(b)(2) and 12(b)(3). Shenzhen separately moved for leave to file a Second Amended Complaint adding more facts and claims concerning copyright infringement and Section 43(a) of the Lanham Act. Shenzhen also requested jurisdictional discovery.

Personal Jurisdiction

The court concluded that Shenzhen had shown JLC-TECH transacted business in New York through its trade-show attendance and sales relationships. But New York’s long-arm statute also required a sufficient connection between those activities and Shenzhen’s declaratory-judgment claims. The court found no such connection. The claims arose from JLC-TECH’s patent-enforcement threat to Arlee Lighting, not from JLC-TECH’s New York sales, distributor relationships, or trade-show attendance.

The court held that the cease-and-desist letter to Arlee Lighting, standing alone, could not establish specific personal jurisdiction in this patent declaratory-judgment action. It also rejected Shenzhen’s argument that JLC-TECH’s attendance at trade shows constituted additional patent-enforcement activity. Shenzhen had not alleged that JLC-TECH enforced or defended the patent at those shows. The court likewise rejected unsupported arguments that JLC-TECH’s New York representatives were exclusive licensees with enforcement obligations.

The court also determined that due process did not permit exercising jurisdiction over JLC-TECH. Under the Federal Circuit’s test, Shenzhen had not shown that its claims arose from JLC-TECH’s activities purposefully directed at New York. The court further found that exercising jurisdiction would not be reasonable and fair, particularly because the parties were already involved in litigation in another district.

Venue

The court held that venue was improper under each relevant part of the federal venue statute. JLC-TECH was not a resident of the Southern District of New York because it was not subject to personal jurisdiction there. The only event Shenzhen identified as giving rise to its claims—the receipt of JLC-TECH’s infringement letter by Arlee Lighting—occurred in the Eastern District of New York, not the Southern District. Venue was also improper under the provision applicable when another district is available, because the parties had litigated in the Eastern District of Pennsylvania and the District of Maryland.

Shenzhen at one point requested transfer if venue was improper, but later stated that it preferred dismissal. The court therefore dismissed rather than considering transfer.

Leave to Amend

The court denied leave to amend as futile. Although the proposed Second Amended Complaint added allegations about copyright-related letters and other enforcement threats, it did not sufficiently connect the patent claims to JLC-TECH’s New York contacts. The proposed copyright and Lanham Act claims also relied primarily on cease-and-desist letters to Arlee Lighting and Big Shine. The court held that those letters, without more, did not establish personal jurisdiction.

The proposed complaint referred to a copyright-enforcement threat at the 2019 LightFair but did not identify that trade show’s location. The court therefore could not determine whether that incident had a connection to New York. The court also noted that JLC-TECH had sent a draft complaint to Arlee Lighting but had not filed it or otherwise shown that it used New York courts. Because the court resolved the amendment request on personal-jurisdiction grounds, it did not address JLC-TECH’s argument that Shenzhen lacked standing to assert declaratory-judgment claims for its customers.

Jurisdictional Discovery and Disposition

The court denied Shenzhen’s request for jurisdictional discovery because Shenzhen had not made the initial factual showing required to establish personal jurisdiction. The court granted JLC-TECH’s motion to dismiss, denied Shenzhen’s cross-motion for leave to amend, denied JLC-TECH’s letter-motion for oral argument as moot, directed the clerk to terminate the motions, and closed the case. Judge Ramos’s ruling was based on jurisdiction, venue, amendment, and discovery issues rather than on whether JLC-TECH’s patent was actually infringed, valid, or enforceable.