The World in U.S. Courts: Summer 2015 - Personal Jurisdiction/Forum Non Conveniens
May.14.2015
Defendant Bell Media, on behalf of a New York company to which it had licensed the "Fashion Television" mark, sent a "cease and desist" letter to FTV relating to FTV's use of the "Fashion Television" mark which Bell Media claimed that it owned. FTV responded by suing Bell Media, as successor-in-interest to a company called Chum Limited, for false advertising, tortious interference, and trade libel. Bell Media moved to dismiss for lack of personal jurisdiction.
Bell Media is a Canadian media corporation with primary operations in Toronto, Ontario. It broadcasts programming in Canada and sells advertising to both Canadian and U.S. businesses. It does not have real property, offices, bank accounts, or other assets in New York. Nor does it have any employees in New York or broadcast content or offer goods or services in New York. Bell Media's contacts with New York are limited to the following: (1) it is the successor-in-interest to Chum, and Chum initiated litigation against FTV in New York in 1998, (2) the securities of Bell Media's ultimate parent are listed on the New York Stock Exchange, and (3) Bell Media uses TeleRep, an independent media sales agency, which has offices in New York and sells advertising time to U.S. advertisers for U.S. and Canadian media clients.
The District Court in New York explained that personal jurisdiction over Bell Media could be asserted only if consistent with New York law and the federal Due Process Clause. New York law would allow specific jurisdiction if Bell Media, itself or through an agent, (1) transacted any business within the State or contracted anywhere to supply goods or services in the State, (2) committed a tortious act within the State or (3) committed a tortious act outside of the State that causes injury to person or property within the State, if Bell Media (i) were found to have engaged in a "persistent course of conduct" in the State or (ii) were found to have derived "substantial revenue" from operations in the State, or (iii) should reasonably have expected the tortious act to have consequences in the State. The claims at issue would also have to arise from the contacts on which jurisdiction was based.
The Court found that this standard was not satisfied. Plaintiffs alleged that specific jurisdiction over Bell Media existed because negotiations occurred in New York relating to license agreements that were the basis of the suit. But the Court found no evidence that Bell Media had negotiated the terms of those agreements in New York or that the contract was executed there. The Court also rejected claims that jurisdiction could attach because Bell Media's counterparties in the licenses had New York contacts, observing that only Bell Media's contacts were relevant. Finally, the Court rejected an argument that Bell Media was the agent of the New York entity in sending the cease and desist letter to FTV that led to the suit being filed.
The Court independently found that specific personal jurisdiction could not be asserted consistent with the federal Due Process Clause of the U.S. Constitution. Most notably, Bell Media's predecessor, Chum, had been a plaintiff in New York 18 years previously in litigation over the "Fashion Television" mark. But the Court found that this action was too remote in time to form a basis for jurisdiction, especially under the circumstance that Bell Media had acted in this case after having itself disposed of its rights to the New York company.
FTV also argued that Bell Media was subject to the Court's general jurisdiction, a finding that would require Bell Media's contacts with New York to be so continuous and systematic as to render it "at home" in the State. Specifically, FTV pointed to the efforts of Bell Media's advertising representative in New York and other licensing efforts. The Court disagreed. It added—unusually for an analysis of general personal jurisdiction—that "the analysis might be different" if FTV had alleged claims arising from the contacts by Bell media's advertising representative.