Federal Circuit expands personal jurisdiction in declaratory judgement suits

In Xilinx Inc. v. Papst Licensing GmbH & Co. KG, Appeal No. 2015-1919 (Fed. Cir. Feb. 15, 2017), the Federal Circuit reversed a district court's decision to grant a motion to dismiss for lack of jurisdiction filed by the non-practicing entity Pabst Licensing. Prior to this, Pabst sent a "love letter" to Xilinx asking for a license. Xilinx invited Pabst to negotiate a license in California, and then Pabst sent some of its agents to negotiate that license.  When the negotiations failed, Xilinx filed for a declaratory judgment of non-infringement in a California court. Pabst, who is located in Delaware, responded by filing a motion to dismiss for lack of jurisdiction.  The district court granted the motion to dismiss.

The Federal Circuit reversed, stating: “[T]here is no question that Papst has the required minimum contacts with California.Papst purposefully directed its activities to California when it sent multiple notice letters to Xilinx and traveled there to discuss Xilinx’s alleged patent infringement and potential licensing arrangements.”

This decision may be questioned on public policy grounds - for it may discourage out-of-state patentees from attempting negotiations with alleged infringers if that means they will have to subject themselves to the jurisdiction of a court in a faraway state.

More information on this case can be found here:

https://www.ipintelligencereport.com/2017/02/22/federal-circuit-expands-personal-jurisdiction-in-declaratory-judgment-suits/#page=1