The opinion of the court was delivered by: Grady, District Judge.
Before the court is the defendants' motion to dismiss the
complaint pursuant to Rule 12(b)(2) of the Federal Rules of Civil
Procedure. For the reasons stated in this opinion, the motion is
Viewed in the plaintiff's favor, the relevant facts are as
follows. Plaintiff LFG, LLC, doing business as Zap Futures, is an
Illinois limited liability company with its principal place of
business in Chicago. It is an electronic brokerage firm involved
in the trading of commodity futures and options over the
internet.*fn1 Zap Futures provides on-line trading, on-line
stock and commodity futures and options research, quotes, and
financial news. It uses the trademark "ZAP" in connection with
its goods and services and has maintained a web site with the
internet domain address "zapfutures.com" since 1996.*fn2
Defendant Zapata Corporation ("Zapata") is a Delaware
corporation with its principal place of business in Houston,
Texas. In early 1998, Zapata developed a plan to create an
internet "portal" through which users could access the internet.
Accordingly, Zapata formed defendant Zap Corp. in April 1998 as a
wholly-owned subsidiary to conduct Zapata's internet
business.*fn3 Zap Corp. is a Nevada corporation with its
principal place of business in Rochester, New York. Its computer
server is in New York as well.
In June 1998, defendants launched their web site (the "Zap
site"), which uses the domain address "zap.com." Internet users
in the United States and most of the world can access the Zap
site. At the time this action was brought, the site was
structured as a "portal," offering a list of connections to other
web sites by way of "hyperlinks."*fn4 Some of the linked sites
merely provided information; others were interactive — for
example, allowing users to purchase music or make travel
reservations. The Zap site connected users to the linked sites at
no charge; in addition, it offered users the opportunity to sign
up for Zapata's mailing list and the ability to make the Zap site
a user's "starting page" at no charge.*fn5
In early summer 1998, Zap Corp. entered into non-binding
letters of intent to acquire the web sites hyperlinked to the Zap
site. Thereafter, and until some point after this suit was
commenced, the Zap site described that list of hyperlinks as "OUR
SITES." In mid-October 1998, however, Zap Corp. announced that it
would not be proceeding with the acquisitions contemplated by the
letters of intent and withdrew the letters. The Zap site as it
currently appears provides links to only two sites, "Word" and
"Charged," the only other web sites Zap Corp. owns.*fn6
Three of the web sites formerly listed on the Zap site under
the heading "OUR SITES" were "Starting Point," "Daily Stocks,"
and "Stocksheet." "Starting Point" provides access to information
about stocks, commodities, and related investments, among other
things. "Daily Stocks" and "Stocksheet" offer stock and commodity
quotes, charts, news, and research. At least three of plaintiff
Zap Futures' competitors advertised their services on one of
these three web sites.
Zap Futures brought this action in August 1998, alleging that
defendants had violated Sections 43(a) and 43(c) of the Lanham
Act, 15 U.S.C. § 1125(a), (c), in connection with their Zap site
activities. Plaintiff also alleges common law unfair competition
and violations of the Illinois Deceptive Trade Practices Act, the
Illinois Consumer Fraud and Deceptive Business Practices Act, and
the Illinois Anti-Dilution Act. The gist of Zap Futures' claim
involves defendants' use of the name "Zap" and the domain name
"zap.com" in connection with stocks and commodities trading.
Plaintiff alleges that defendants' activities will likely cause
trade and public confusion and dilution of the quality of Zap
Futures' "ZAP" mark. Zap Futures seeks to enjoin defendants'
alleged trademark infringement, trademark dilution, and unfair
competition, and also seeks damages. Defendants have moved to
dismiss this suit for lack of personal jurisdiction pursuant to
Rule 12(b)(2) of the Federal Rules of Civil Procedure.
The standards by which the court must evaluate a 12(b)(2)
motion to dismiss are straightforward. The plaintiff bears the
burden of providing sufficient evidence to establish a prima
facie case for personal jurisdiction. RAR, Inc. v. Turner
Diesel, Ltd., 107 F.3d 1272, 1276 (7th Cir. 1997); Michael J.
Neuman & Assocs. v. Florabelle Flowers, Inc., 15 F.3d 721, 724
(7th Cir. 1994); Arena Football League, Inc. v. Roemer,
947 F. Supp. 337, 339 (N.D.Ill. 1996). The jurisdictional allegations
in the complaint are taken as true unless controverted by the
defendant's affidavits. Any conflicts among affidavits must be
resolved in the plaintiff's favor. Turnock v. Cope,
816 F.2d 332, 333 (7th Cir. 1987); Cherry Communications, Inc. v. Coastal
Tel. Co., 906 F. Supp. 452, 454 (N.D.Ill. 1995); Czarobski v.
St. Kieran's Church, 851 F. Supp. 1219, 1220 (N.D.Ill. 1994).
In federal question cases, a prima facie case for personal
jurisdiction has two elements. First, the plaintiff must
demonstrate that bringing the defendant into court comports with
Fifth Amendment Due Process. Second, the plaintiff must show that
the defendant is amenable to service of process. See United
States v. De Ortiz, 910 F.2d 376, 381-82 (7th Cir. 1990). As we
discuss below, Zap Futures has met both requirements.
A court's assertion of personal jurisdiction must comport with
"`traditional notions of fair play and substantial justice'" to
satisfy the Due Process Clause. International Shoe Co. v.
Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945)
(quoting Milliken v. Meyer, 311 U.S. 457, 463, 61 S.Ct. 339, 85
L.Ed. 278 (1940)). The touchstone of the due process analysis is
whether the defendant purposefully established "minimum contacts"
with the political unit encompassing the forum. Asahi Metal
Indus. Co. v. Superior Court of Cal., 480 U.S. 102, 108-09, 107
S.Ct. 1026, 94 L.Ed.2d 92 (1987). Even defendants not physically
present in the jurisdiction have sufficient "minimum contacts" if
they do some act by which they purposefully avail themselves of
the privilege of conducting activities in the forum state,
Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 2 L.Ed.2d
1283 (1958), and if they "should reasonably anticipate being
haled into court there." World-Wide Volkswagen Corp. v.
Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 62 L.Ed.2d 490
(1980). Due process also requires that the action arise from or
relate to the defendant's contacts with the forum state. Burger
King Corp. v. Rudzewicz,
471 U.S. 462, 472, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985);
Heritage House Restaurants, Inc. v. Continental Funding Group,
Inc., 906 F.2d 276, 281 (7th Cir. 1990). Finally, the court
should consider whether it ...