The opinion of the court was delivered by: District Judge Charles P. Kocoras
Magistrate Judge Daniel G. Martin
MEMORANDUM OPINION AND ORDER
Plaintiff Snap-On, Inc. ("Snap-On" or "Plaintiff") has sued Defendants Robert Bosch LLC ("Bosch LLC"), Robert Bosch GmbH ("Bosch GmbH"), and Beissbarth GmbH ("Beissbarth") (collectively "Defendants") for the infringement of various patents Snap-On holds concerning a wheel-alignment system that it manufactures. Plaintiff alleges that Defendants infringed the patents by introducing and selling a competing alignment product known as the FWA 4630 in the United States. Beissbarth and Bosch GmbH, which are both German companies, are referred to collectively herein as "the German Defendants."
On January 16, 2012, Beissbarth and Bosch GmbH filed Motions to Dismiss claims against them for lack of personal jurisdiction. On May 17, 2012, District Judge Charles Kocoras referred the case to Magistrate Judge Morton Denlow for the resolution of discovery matters, including discovery related to the parties' jurisdictional dispute. As described more fully below, Judge Denlow issued an initial order, and jurisdictional discovery proceeded. The case was reassigned to this Court on October 1, 2012 after Judge Denlow retired from the bench.
The parties disagree on whether the discovery responses the German Defendants provided pursuant to Judge Denlow's order are sufficient, or whether additional discovery is required before District Judge Kocoras can consider the pending Motions to Dismiss. Before this Court are Bosch GmbH's Motion for Protective Order Precluding Additional Personal Jurisdictional Discovery  and its Motion for Protective Order to Preclude Expanding Personal Jurisdictional Discovery . Beissbarth is not a party to these motions and has not sought protection from further discovery. The Court allowed Snap-On to file a consolidated response that includes its Request for Jurisdictional Document Discovery . After considering the parties' briefs and exhibits, the Court finds that the first Motion for Protective Order is denied as moot, the second Motion for Protective Order is granted, and Plaintiff's Request is granted in part and denied in part.
Snap-On manufactures and distributes a variety of tools and equipment, including diagnostic devices used to identify problems with wheel alignment. These products are sold in the automotive aftermarket. By the early 1990s, Snap-On began distributing a new form of "vision" or "image" alignment that uses camera modules to target specific portions of a wheel. Snap-On claims that Bosch LLC infringed the patents related to this system by introducing the competing FWA 4630 aligner in the fall of 2009. Bosch LLC is a Delaware corporation with its principal place of business in Broadview, Illinois. The company is part of the world-wide organization known as the Bosch Group. (Doc. 195 at Ex. 11). This group includes the German parent company, Bosch GmbH, which in turn owns 350 subsidiaries in sixty countries, including the German subsidiary Beissbarth. (Id.).
The German Defendants concede that Beissbarth manufactures the FWA 4630 in Germany, where Beissbarth first introduced it to the German market as a product called the "Easy 3D." (Doc. 173 at 2). As the Court understands it, Beissbarth sells its image aligner in Europe under the Easy 3D name, but Bosch LLC distributed it in this country as the product at issue in this suit, the FWA 4630. Bosch LLC purchases the FWA 4630 from Beissbarth in Germany and has it shipped to the United States. (Id.).
Plaintiff alleges that the German Defendants are not passive parties to the FWA 3640's sale in this country. Plaintiff claims that Bosch GmbH made the decision to introduce the FWA 4630 in the United States and that it has been directly involved in purposeful activities that led to its importation and sale. (Doc. 90 at 7). Plaintiff also claims that Bosch GmbH acquired Beissbarth to further this plan because Beissbarth is experienced in manufacturing diagnostic equipment. Acting together, Bosch GmbH and Beissbarth allegedly designed the FWA 4630 and then worked with Bosch LLC to introduce it to the American market. (Id.).
The German Defendants vigorously dispute this allegation. They supported their Motions to Dismiss with four affidavits given by employees of Beissbarth and Bosch GmbH. The affidavits made various fact assertions intended to demonstrate that the German Defendants did not have a sufficient role in selling the FWA 4630 in Illinois or other parts of the United States to give rise to personal jurisdiction. (Doc. 195 at Ex. 1). In response, Snap-On sought discovery to establish whether personal jurisdiction exists over Bosch GmbH and Beissbarth.
District Judge Kocoras held a status hearing on January 19, 2012 and agreed that some jurisdictional discovery was in order. Plaintiff's counsel consented at the hearing to draft discovery requests and to submit them to the German Defendants so that the parties could narrow the relevant issues. An additional status was held in May 2012, when the parties reported that they could not reach an agreement on the scope of jurisdictional discovery. Counsel for the German Defendants told Judge Kocoras that Snap-On was proposing nineteen document requests as well as a set of interrogatories. (Trans. of 5/17/2012 hearing at 5). Judge Kocoras referred the matter to Judge Denlow, and the parties promptly filed discovery motions and motions for protective orders.
At a June 18, 2012 hearing, Judge Denlow granted all the motions in part and ordered that jurisdictional discovery should be "limited to any contacts by Bosch GmbH and Beissbarth GmbH with the United States regarding the accused product[,] and jurisdictional discovery should initially be limited to interrogatories and request[s] for admission." (Doc. 158). Snap-On subsequently submitted 74 requests for admission and 22 interrogatories to Bosch GmbH, and 75 requests and 24 interrogatories to Beissbarth. The German Defendants responded, and the parties then brought the three motions currently before this Court.
The question of whether jurisdictional discovery should be allowed in a patent infringement suit is determined under the law of the regional circuit in which the case is filed. Autogenomics, Inc. v. Oxford Gene Tech. Ltd., 566 F.3d 1012, 1021-22 (Fed. Cir. 2009). Discovery is permitted in the Seventh Circuit only when a plaintiff first establishes a prima facie case demonstrating that personal jurisdiction exists. Central States, S.E. and S.W. Areas Pension Fund v. Reimer Express World Corp., 230 F.3d 934, 946 (7th Cir. 2000). A plaintiff must also demonstrate that "the factual record is at least ambiguous or unclear on the jurisdictional issue." Ticketreserve, Inc. v. viagogo, Inc., 656 F. Supp.2d 775, 782 (N.D. Ill. 2009) (citation omitted).
The issue of whether personal jurisdiction exists in this case is a matter for the District Judge to decide. Yet the standard that guides such an analysis determines the need and the relevance of the documents that Snap-On is seeking. Unlike the right to discovery, the question of whether a court has personal jurisdiction over a defendant in a patent case is decided under the law of the Federal Circuit. A three-prong test applies to this analysis. A court asks whether: (1) the defendant purposefully directed its activities to residents of the forum; (2) the claim arises out of or relates to those activities; and (3) the assertion of personal jurisdiction is reasonable and fair. Akro Corp. v. Luker, 45 F.3d 1541, 1545-46 (Fed. Cir. 1995). The first two factors correspond to the familiar "minimum contacts" prong of the test set forth in Int'l Shoe Co. v. Washington, 326 U.S. 310 (1945). Inamed Corp v. Kuzmak, 249 F.3d 1356, 1360 (Fed. Cir. 2001).
With the exception of two Bosch GmbH employees who attended a meeting in Illinois, Snap-On does not claim in its response that the German Defendants had meaningful contacts with this State. However, physical contact with the forum is not necessary. A plaintiff can show minimal contacts by demonstrating that a defendant has delivered its products into the stream of commerce with an expectation that they will reach the forum. Nuance Comm., Inc. v. Abbyy Software House, 626 F.3d 1222, 1233 (Fed. Cir. 2010). Thus, even when a foreign manufacturer has no assets, employees, or direct sales in a forum, a court can still exercise personal jurisdiction over it when the defendant purposefully ships products through a distributor with the expectation that they will be sold in the forum. See Beverley Hills Fan Co. v. Royal Sovereign Corp., 21 F.3d 1558, 1565-67 (Fed. Cir. 1994); Nuance Comm., 626 F.3d at 1233-34.
Both Snap-On and the German Defendants devote a considerable portion
of their arguments to disputing what District Judge Kocoras and Judge
Denlow have stated concerning the scope of discovery.*fn1
Snap-On argues that neither judge disallowed document
requests completely. The German Defendants claim that both judges'
prior rulings preclude all forms of discovery other than
interrogatories and requests for admission.
The Court disagrees with the German Defendants' view of the record. Judge Kocoras stated at the January 19, 2012 hearing that document production might be one means of addressing the jurisdictional issue. He noted that he was "fairly well married to the idea of interrogatories" instead of depositions or document requests in light of the parties' tendency "to ask for the sun, moon, and stars." (Trans. of 1/19/2012 hearing at 23-24). However, Judge Kocoras did not rule out the possibility of future document requests altogether. He only stated that document production should not be considered "unless and until there is a basis for me to believe whatever is being relied on, that is being the subject of the document request or being attacked, has a good faith basis behind it." (Id.). Judge Denlow's June 18 order is in broad agreement with this position. The order states that discovery should be "initially" limited to interrogatories and requests for admission. (Doc. 158). It did not close off all possibilities of such discovery in the future. (Id.).
This Court agrees with the District Judge and Magistrate Judge Denlow that the requests already exchanged were the most appropriate initial means of jurisdictional discovery. For this reason, the Court finds that document production should be considered in this dispute only if answers to the interrogatories and the requests for admission that Judge Denlow permitted have been clearly insufficient.
Snap-On argues that the German Defendants' discovery responses are more than just inadequate. It also claims that they are misleading and intentionally incomplete. If Plaintiff's position is correct, the documents Snap-On seeks may be in order. It is possible, however, that Snap-On has merely received responses that it does not like. The German Defendants contend that they gave Plaintiff what it asked for in the interrogatories, but that Snap-On inadequately framed its discovery requests and is now unhappy with the answers it received. If that is the case, then document production may not be required.
The Court therefore approaches the voluminous record that has been submitted as part of these motions with two guiding inquiries: What has Snap-On already asked for, and what basis exists for finding that the ...