Case3:14-cv-03264-JD Document738 Filed06/11/15 Page1 of 7
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`UNITED STATES DISTRICT COURT
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`NORTHERN DISTRICT OF CALIFORNIA
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`IN RE CAPACITORS ANTITRUST
`LITIGATION.
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`Master File No. 14-cv-03264-JD
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`ORDER DENYING DEFENDANT
`NIPPON CHEMI-CON’S MOTION TO
`DISMISS FOR LACK OF PERSONAL
`JURISDICTION
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`Re: Dkt. No. 478
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`As detailed in a prior order, Dkt. No. 710, these consolidated antitrust class actions allege
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`price-fixing conspiracies in the capacitor industry. Nippon Chemi-Con Corporation (“NCC”), a
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`Japanese corporation that manufactures capacitors, is named as a defendant by the direct
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`purchasers and the indirect purchasers in their separate consolidated complaints. Dkt. No. 400
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`¶ 71; Dkt. No. 401 ¶ 44. NCC joined the global motions to dismiss that the Court largely denied.
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`See Dkt. No. 474 at xii n.1; Dkt. No. 479 at 1 n.1. NCC also filed this separate motion seeking
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`dismissal for lack of personal jurisdiction. Dkt. No. 478. The motion is denied.
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`BACKGROUND
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`The direct purchaser plaintiffs (“DPPs”) and indirect purchaser plaintiffs (“IPPs”) named
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`NCC as a defendant in their complaints. Dkt. No. 400 ¶ 71; Dkt. No. 401 ¶ 44. Both complaints
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`also named as a defendant NCC’s U.S. subsidiary, United Chemi-Con Corporation (“UCC”),
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`which is an Illinois corporation. Dkt. No. 400 ¶ 72; Dkt. No. 401 ¶ 45. UCC does not contest
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`personal jurisdiction; only NCC moves to dismiss.
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`DISCUSSION
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`On a motion to dismiss for lack of personal jurisdiction under Federal Rule of Civil
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`Procedure 12(b)(2), the party asserting personal jurisdiction has the burden of proving its
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`existence. Action Embroidery Corp. v. Atlantic Embroidery, Inc., 368 F.3d 1174, 1177 (9th Cir.
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`Northern District of California
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`United States District Court
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`Case3:14-cv-03264-JD Document738 Filed06/11/15 Page2 of 7
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`2004). Where, as here, the motion is based on written materials rather than an evidentiary hearing,
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`the plaintiff need only make a prima facie showing of jurisdictional facts. Schwarzenegger v.
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`Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004). In determining whether such a
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`showing has been made, the court takes as true uncontroverted allegations in the complaint and
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`resolves factual conflicts in the parties’ affidavits in favor of the party asserting jurisdiction.
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`Action Embroidery, 368 F.3d at 1177.
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`For a court to exercise personal jurisdiction over a defendant, there must be an applicable
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`rule or statute that confers jurisdiction over it. Id. And for a court to exercise personal jurisdiction
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`over a nonresident defendant like NCC, the defendant must have at least “minimum contacts” with
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`the relevant forum so that the exercise of jurisdiction “does not offend traditional notions of fair
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`play and substantial justice.” Schwarzenegger, 374 F.3d at 801 (quoting International Shoe Co. v.
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`Washington, 326 U.S. 310, 316 (1945)).
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`The parties agree that the statute conferring jurisdiction over NCC is the Clayton Act, 15
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`U.S.C. § 22, and that the “relevant forum” with which NCC must have minimum contacts is the
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`United States as a whole. Dkt. No. 635-4 at 6; Dkt. No. 684; see also Action Embroidery, 368
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`F.3d at 1177, 1180 (in Section 1 antitrust case, Clayton Act § 12 is statutory jurisdictional basis
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`and United States is relevant forum). The parties also agree that the only question before the
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`Court is whether it can properly exercise specific jurisdiction over NCC. Plaintiffs do not argue
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`that NCC’s contacts with the United States allow the Court to exercise general jurisdiction over it.
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`The dispute between the parties is whether the test for specific jurisdiction is satisfied for
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`NCC. In our Circuit, courts apply a three-part test to determine whether specific jurisdiction
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`comports with due process: (1) the non-resident defendant must purposefully direct its activities
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`or consummate some transaction with the forum or resident therein; or perform some act by which
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`it purposefully avails itself of the privilege of conducting activities in the forum, thereby invoking
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`the benefits and protections of its laws; (2) the claim must arise out of or relate to the defendant’s
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`forum-related activities; and (3) the exercise of jurisdiction must be reasonable. Schwarzenegger,
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`374 F.3d at 802. Plaintiff bears the burden of satisfying the first two prongs, and if the plaintiff
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`succeeds, the burden then shifts to the defendant to “present a compelling case” that the exercise
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`of jurisdiction would not be reasonable. Id.
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`Purposeful availment and purposeful direction in the first part of the test are distinct
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`concepts. Schwarzenegger, 374 F.3d at 802. In an apparent effort to hedge its bet, NCC mentions
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`both without commitment. But our Circuit has indicated that the right analysis in this case is
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`purposeful direction. The Circuit has determined that “purposeful availment analysis is most often
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`used in suits sounding in contract,” id., which does not fit this price-fixing conspiracy case. And it
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`recently applied the purposeful direction analysis in In re Western States Wholesale Natural Gas
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`Antitrust Litigation, 715 F.3d 716, 743 (9th Cir. 2013), an antitrust case. See also Fleury v.
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`Cartier Int’l., No. C-05-4525 EMC, 2006 WL 2934089, at *2 (N.D. Cal. Oct. 13, 2006) (applying
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`purposeful direction test to antitrust claims). The Court applies that analysis here.
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`A showing that a defendant purposefully directed his conduct toward a forum state usually
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`consists of evidence of the defendant’s actions outside the forum state that are directed at the
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`forum, “such as the distribution in the forum state of goods originating elsewhere.”
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`Schwarzenegger, 374 F.3d at 803. Our Circuit evaluates purposeful direction under the three-part
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`“effects” test traceable to Calder v. Jones, 465 U.S. 783 (1984): the defendant must have
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`“(1) committed an intentional act, (2) expressly aimed at the forum state, (3) causing harm that the
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`defendant knows is likely to be suffered in the forum state.” Schwarzenegger, 374 F.3d at 803.
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`I. PURPOSEFUL DIRECTION
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`The only real issue in dispute is whether NCC has expressly aimed its conduct toward the
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`United States. Plaintiffs’ evidence, which the Court finds to be sufficient, falls into two
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`categories.
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`The first relates to sales of NCC’s capacitors in the United States. Plaintiffs presented
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`evidence in the form of shipping records showing that NCC in Japan sent electrolytic capacitors
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`directly to company customers in the United States during the alleged class period. See Dkt.
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`No. 637-2 (FedEx labels showing shipments of “aluminum electrolytic capacitors,” from NCC to
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`eIQ Energy in San Jose, California); Dkt. No. 698-3 (invoice & packing list describing goods as
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`aluminum electrolytic capacitors and listing NCC as “shipper” and a recipient company in
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`California as the “deliver to”). It is true that NCC’s U.S. subsidiary, UCC, is shown as the
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`“accountee” in both cases, and defendant submitted a declaration stating that “to the extent UCC
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`resells NCC capacitors in the United States, UCC takes title to those capacitors in Japan.” Dkt.
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`No. 478-1 ¶ 21. The Court agrees with NCC that jurisdiction over it cannot be traced through
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`UCC under an agency or alter ego theory, and the Court declines plaintiffs’ arguments to the
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`contrary. But NCC’s effort to deflect the impact of the shipping records by focusing on the
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`“accountee” line misses the mark as well.
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`The fact that UCC is the “accountee” and takes title to these capacitors in Japan might
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`make a difference for tax and accounting purposes, but not for this jurisdictional analysis. The
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`documents showing that NCC physically shipped electrolytic capacitors directly to customers in
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`the United States (regardless of the manner in which legal title to those capacitors may have
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`passed) establish that NCC is, directly or indirectly, serving the United States as a market for its
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`products. See World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297-87 (1980) (“The
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`forum State does not exceed its powers under the Due Process Clause if it asserts personal
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`jurisdiction over a corporation that delivers its products into the stream of commerce with the
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`expectation that they will be purchased by consumers in the forum State.”); see also In re Cathode
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`Ray Tube (CRT) Antitrust Litigation, 27 F. Supp. 3d 1002, 1013 (N.D. Cal. 2014) (“Defendant
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`does not have to direct Panasonic’s activity in order for this to count as purposeful direction: it is
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`enough for Defendant to have known that Panasonic was going to sell these goods in the United
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`States, which evidence shows Defendant indeed knew”).1
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`Plaintiffs’ position is enhanced by the second category of evidence, which shows that NCC
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`aimed its alleged cartel behavior at the United States. Plaintiffs’ exhibit on this point, Dkt.
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`No. 636-1, consists of meeting minutes from August 29, 2003. NCC is listed as a participant and
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`1 Plaintiffs’ evidence includes documents that show NCC as the “shipper” and a United States
`company as the “consignee,” although these additional documents do not explicitly list the United
`States company as the “ship to” recipient. See, e.g., Dkt. Nos. 698-2, 698-5, 698-6. Plaintiffs also
`point to the declaration submitted by NCC in which its “Department Manager of Administration
`Headquarters” admits two possible direct sales by NCC into the United States “totaling under
`$150 made between April and October 2003.” Dkt. No. 478-1 ¶ 7. This evidence provides
`additional support for plaintiffs’ prima facie showing.
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`the minutes expressly state that the “purpose of the meeting is to exchange information by market
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`and by capacitor category so that each company will be able to enjoy profits and that healthy
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`market prices will be maintained.” The minutes note that “[i]n the U.S., GM is enjoying brisk
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`sales (Business circumstances vary among Big 3),” and additionally discuss prices for cases,
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`presumably of capacitors, using United States currency (cents). While this document standing
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`alone would not have added much to the jurisdictional analysis, the Court finds that in
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`combination with the U.S.-directed sales documents discussed above, plaintiffs have met their
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`burden of establishing purposeful direction. See CRT, 27 F. Supp. 3d at 1012 (finding purposeful
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`direction where, among other things, plaintiffs provided evidence that “co-conspirators
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`coordinated pricing decisions in relation to United States market conditions, and discussed CRT
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`prices in U.S. dollars”).
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`NCC has repeatedly invoked Daimler AG v. Bauman, 134 S.Ct. 746 (2014), as mandating
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`dismissal. At the hearing, however, in response to questions by the Court, NCC reversed course
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`and agreed that Daimler is a case about general jurisdiction only, and is not on point for the
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`specific jurisdiction question presented here. Cf. CRT, 27 F. Supp. 3d at 1014 (finding that comity
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`concerns raised in Daimler are lessened where “only specific jurisdiction is at issue”).
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`Walden v. Fiore, 134 S.Ct. 1115 (2014), another case relied on by NCC, also does not help
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`it. That case differs from this one in significant ways. In Walden, petitioner “never traveled to,
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`conducted activities within, contacted anyone in, or sent anything or anyone to Nevada,” the
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`relevant forum. 134 S.Ct. at 1124 (emphasis added). That contrasts sharply to the facts here,
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`where NCC physically shipped electrolytic capacitors to the United States. In fact, Walden
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`expressly holds that such “physical entry into the State -- either by the defendant in person or
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`though an agent, goods, mail, or some other means -- is certainly a relevant contact” in finding
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`minimum contacts for specific jurisdiction. Id. at 1122. And the Court has found an adequate
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`showing that NCC aimed its alleged cartel behavior at the United States. Cf. In re W. States
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`Wholesale Natural Gas Antitrust Litig., 715 F.3d at 744 (alleged facts, taken as true, establish that
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`defendants’ “price manipulation was ‘expressly aimed’ at Wisconsin, because the AEP Defendants
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`knew and intended that the consequences of their price manipulation would be felt in
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`Wisconsin.”). Consequently, “when viewed through the proper lens -- whether defendant’s
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`actions connect him to the forum,” Walden, 134 S.Ct. at 1124 (emphasis in original), the answer
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`here is the opposite of what it was in Walden: yes, NCC has made jurisdictionally meaningful
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`contacts with the relevant forum, the United States.
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`II.
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`CLAIM ARISING OUT OF OR RELATING TO DEFENDANT’S FORUM-
`RELATED ACTIVITIES
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`Plaintiffs have also satisfied the second prong -- their claims arise out of or relate to
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`defendant’s forum-related activities. Plaintiffs need only make a prima facie showing that NCC’s
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`U.S.-directed actions were a “but-for” cause of their claims. CRT, 27 F. Supp. 3d at 1013 (citing
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`Bancroft & Masters, Inc. v. Augusta Nat’l., Inc., 223 F.3d 1082, 1088 (9th Cir. 2000)). This test
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`requires “some nexus between the cause of action and the defendant’s activities in the forum.” Id.
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`(quoting Shute v. Carnival Cruise Lines, 897 F.2d 377, 387 (9th Cir. 1988), overruled on other
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`grounds, 499 U.S. 585 (1991)). Without a doubt, plaintiffs’ claims in these antitrust actions arise
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`out of and are related to the sale of NCC’s capacitors in the United States and NCC’s alleged
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`participation in the alleged capacitor price-fixing conspiracies.
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`III. REASONABLENESS OF EXERCISING JURISDICTION
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`The Court also needs to consider whether the exercise of specific jurisdiction over NCC is
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`reasonable. For this part of the test, the burden is on the defendant to present a “compelling case”
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`that the exercise of jurisdiction is not reasonable. Schwarzenegger, 374 F.3d at 802. For
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`jurisdiction to be reasonable, it must comport with fair play and substantial justice. Bancroft &
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`Masters, Inc., 223 F.3d at 1088. “The reasonableness determination requires the consideration of
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`several specific factors: (1) the extent of the defendant’s purposeful interjection into the forum
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`state, (2) the burden on the defendant in defending in the forum, (3) the extent of the conflict with
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`the sovereignty of the defendant’s state, (4) the forum state’s interest in adjudicating the dispute,
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`(5) the most efficient judicial resolution of the controversy, (6) the importance of the forum to the
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`plaintiff’s interest in convenient and effective relief, and (7) the existence of an alternative forum.”
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`Id.
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`These factors do not require extended discussion because NCC made only the slightest nod
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`towards them in its briefs. See Dkt. No. 684 at 8-9. NCC’s argument is perfunctory and falls far
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`short of meeting its burden of presenting a “compelling case” of unreasonableness. The scant
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`discussion it does offer largely tracks the unpersuasive points made in the CRT case, with much
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`less breadth and depth, and the Court rejects them for the same reasons detailed in that decision.
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`27 F. Supp. 3d at 1013-15.
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`Even affording NCC the benefit of the doubt and considering some of the seven factors, its
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`arguments fail. On purposeful interjection, for example, the Court finds that there is more here
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`than in most cases. In addition to the facts that show purposeful direction, NCC admits that it was
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`registered and licensed to do business in the United States, and had a research and development
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`office in San Jose, California, during the time period at issue in this litigation. Dkt. No. 478-1
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`¶ 11. Moreover, as was the case in CRT, plaintiffs are “United States citizens who allege that they
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`were harmed by defendant, which directed its activities toward the United States. That gives
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`United States federal courts an interest in hearing this case.” 27 F. Supp. 3d at 1014. In addition,
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`the record on the alternative forum factor is too undeveloped to weigh in favor of either party, and
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`the burden on NCC to defend against a case abroad, while not light, is mitigated by the advances
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`in modern technology and counter-balanced by the United States federal courts’ interest in hearing
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`this case.
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`CONCLUSION
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`The Court finds sufficient facts to warrant specific jurisdiction over NCC and that it is not
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`unfair or unreasonable to subject NCC to the jurisdiction of this Court. Consequently, Nippon
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`Chemi-Con Corporation’s motion to dismiss for lack of personal jurisdiction is denied.
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`IT IS SO ORDERED.
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`Dated: June 11, 2015
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`________________________
`JAMES DONATO
`United States District Judge
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