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Judge Stark denies renewed motion to dismiss for lack of personal jurisdiction

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In a recent Memorandum Order, Chief Judge Leonard P. Stark denied foreign defendant API Korea Co., Ltd.’s (“API”) renewed motion to dismiss the second amended complaint for lack of personal jurisdiction. Robert Bosch LLC, v. Alberee Products, Inc., et al., C.A. No. 12-574-LPS (D. Del. Mar. 17, 2016) (public version published Mar. 25, 2016). The Court had previously granted plaintiff’s (“Bosch”) request for jurisdictional discovery with respect to API.

Judge Stark first rejected Bosch’s argument that “jurisdictional discovery . . . revealed evidence that API has an agency relationship” with U.S. defendants Alberee Products, Inc. (“Alberee”) and Saver Automotive Products, Inc. (“Saver”). Id. at 2-5. Accordingly, Judge Stark did not attribute Alberee or Saver’s jurisdictional contacts to API. Id. at 5. Moreover, while Bosch also argued for an “alter ego” relationship, Judge Stark found that Bosch failed to “point to any fraud or inequity which would allow the Court to ‘pierce the corporate veil.’” Id. at 3 n.2.

Judge Stark did, however, find that the Court may exercise dual jurisdiction over API pursuant to Delaware’s long-arm statute. Id. at 6. Specifically, Bosch asserted a theory of “dual, or stream-of-commerce, jurisdiction based on subsections c(1) and c(4) of Delaware’s long-arm statute.” Id. at 5. Judge Stark reasoned that in the “absence of any evidence that API intended to exclude Delaware from the U.S. distribution of the finished wiper blade products containing the API components, the Court finds that API had an intent to serve the Delaware market, and it is undisputed that this cause of action arises from injuries caused by those products.” Id. at 5-6. Judge Stark also found the exercise of jurisdiction over API based on the stream-of-commerce comports with the requirements of Due Process. Id. at 8. Judge Stark explained that “jurisdictional discovery has revealed evidence supporting an inference ‘that the distribution channel formed by [API, Alberee, Saver, and Costco] was intentionally established, and that defendants knew, or reasonably could have foreseen, that a termination point of the channel was [Delaware].’” Id. at 7. As Judge Stark noted, “[t]his goes beyond evidence of mere foreseeability that API’s components would be sold in Delaware. Rather, API had knowledge that its components were used by Alberee in finished products sold to Saver for distribution through nationwide retailers such as Costco.” Id.

 

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