The opinion of the court was delivered by: STANTON
American Network, Inc. ("ANI"), a New York corporation that provides services allowing computer users to gain access to the Internet, asserts claims of trademark infringement and unfair competition against Access America / Connect Atlanta, Inc. ("Access"), a Georgia corporation that provides similar services. ANI claims that a mark used by Access, "America.Net", infringes a mark ANI owns, "American.Net".
Defendant moves pursuant to Federal Rule of Civil Procedure 12(b)(2) to dismiss the complaint for lack of personal jurisdiction, and in the alternative moves pursuant to 28 U.S.C. § 1404(a) to transfer this action to the Northern District of Georgia.
As both parties have presented matters outside the pleadings to the court and neither suggests that it requires further discovery to respond to the materials presented, this motion is treated as a motion for summary judgment with respect to the jurisdictional issue. See Rodriguez v. Fullerton Tires Corp., 115 F.3d 81, 83 (1st Cir. 1997). The undisputed facts are as follows, viewed in the light most favorable to plaintiff. See Ball v. Metallurgie Hoboken-Overpelt, S.A., 902 F.2d 194, 197 (2d Cir.), cert. denied, 498 U.S. 854, 111 S. Ct. 150, 112 L. Ed. 2d 116 (1990).
Defendant has its only office and all of its business facilities in Alpharetta, Georgia, and all of its employees are Georgia residents. It owns no property in New York. Its "server," which is the computer equipment it uses to provide its customers with access to the Internet,
is located in Georgia.
Defendant uses its server to maintain a site on the World Wide Web ("the Web")
and publish documents there. Computer users may visit defendant's site by directly dialing the telephone number for that site or by connecting to it through the Internet.
When a computer user visits defendant's site, the document that initially appears on the user's computer screen is the "home page." (Charugundla Aff., Ex. B.) At the top of that page is the word "america.net" in large letters. Below, in smaller type, the page shows defendant's Georgia mailing address and describes how to browse through other "pages" or documents stored at defendant's site and how to return from those pages to the home page.
Defendant's home page displays a "hyperlink" to a page provided by defendant's sales department. By selecting that hyperlink, the computer user can view on his or her screen defendant's service agreement, which states that it "is printed on paper and is included with every package of client software delivered to America.Net customers. By opening the client software disk packaging, each customer agrees to this agreement." (Cohen Aff., Ex. A.) The agreement states that all of defendant's subscribers must enter into the agreement to use defendant's services.
Defendant claims that it has 7500 subscribers worldwide but only six in New York. It claims that those New York subscribers constitute only 0.08% of its customer base and contribute only $ 150 per month out of its monthly revenue of $ 195,000. Defendant does not state whether those subscribers are customers of the Connect Atlanta division, the IBC Affiliates division, or some other division.
Plaintiff ANI has 18,000 customers, including 1500 in New York City, which is where its principal place of business is located. It sells its Internet services under the marks "American Network, Inc." and "American.Net", and owns the mark "American Network, Inc.", which is registered with the United States Patent and Trademark Office.
ANI's president, Kent Charugundla, states that he first heard of defendant in 1994 at an industry trade show where defendant had sent a representative. At the time, defendant was not using the "America.Net" mark. Charugundla gave the representative his business card, which showed plaintiff's "American Network" mark and its New York place of business. Two years later, when Charugundla was at a convention, he saw a poster on which defendant was using the "America.Net" mark. He told one of defendant's executives that use of that mark infringed plaintiff's rights. After receiving a letter from defendant's counsel demanding that plaintiff give up its mark, plaintiff filed this action, asserting that defendant's mark is confusingly similar to plaintiff's and that its use infringes plaintiff's trademark rights under federal and state law.
Because the federal trademark laws do not give plaintiff the right to nationwide service of process, this court can exercise jurisdiction over a defendant only pursuant to the law of the forum state. See Stabilisierungsfonds Fur Wein v. Kaiser Stuhl Wine Distribs. Pty. Ltd., 207 U.S. App. D.C. 375, 647 F.2d 200, 204 (D.C. Cir. 1981). Plaintiff relies on New York's long-arm statute, N.Y. CPLR § 302, and asserts that this court can exercise jurisdiction over defendant under subsections (a)(1), (a)(2), and (a)(3)(ii) of that statute. Defendant contends that none of those subsections apply and that the exercise of jurisdiction over it would violate due process.
The New York long-arm statute provides in section ...