Clearone, Inc. v. Revolabs, Inc.

This opinion is subject to revision before final
publication in the Pacific Reporter
2016 UT 16IN THE
SUPREME COURT OF THE STATE OF UTAH
CLEARONE, INC.,
Appellant,
v.
REVOLABS, INC.,
Appellee.
No. 20141184
Filed April 1, 2016
On Direct Appeal
Third District, Salt Lake
The Honorable Judge Kate A. Toomey
Case No. 140905197
Attorneys:
James E. Magleby, Christine T. Greenwood, Jennifer Fraser Parrish,
Kennedy Davis Nate, Salt Lake City, for appellant
Steven W. Dougherty, Andrew R. Hale, Salt Lake City, for appellee
CHIEF JUSTICE DURRANT authored the opinion of the Court, in which
ASSOCIATE CHIEF JUSTICE LEE, JUSTICE DURHAM,
and JUSTICE HIMONAS joined.
JUSTICE JOHN A. PEARCE became a member of the Court on
December 17, 2015, after oral argument in this matter, and
accordingly did not participate.
CHIEF JUSTICE DURRANT, opinion of the Court:
Introduction
¶ 1 This case presents us with the opportunity to review and
apply the United States Supreme Court‘s recent cases on both
specific and general personal jurisdiction. The question is whether
CLEARONE v. REVOLABS
Opinion of the Court
Revolabs, a corporation incorporated in Delaware with its principal
place of business in Massachusetts, is subject to either specific or
general personal jurisdiction in Utah. The underlying dispute arose
when Revolabs allegedly interfered with ClearOne‘s contractual
relationship with Timothy Mackie by recruiting and hiring him
while he was still employed by ClearOne. ClearOne brought suit
against Revolabs, asserting claims of intentional interference with a
contractual relationship, predatory hiring, and aiding and abetting a
breach of fiduciary duty. The trial court granted Revolabs‘s motion
to dismiss for lack of personal jurisdiction, which ruling ClearOne
now appeals. After a review of the United States Supreme Court‘s
personal jurisdiction jurisprudence, we conclude that Revolabs has
insufficient contacts with Utah to subject it to jurisdiction here and
affirm.
Background
¶ 2 Plaintiff ClearOne is a Utah corporation that designs,
develops, and sells audio-visual equipment, with its principal place
of business in Utah.1 Defendant Revolabs is a competitor that is
incorporated in Delaware with its principal place of business in
Massachusetts. Mr. Mackie is a former employee of ClearOne who
worked for ClearOne in a technical sales position from November
2009 to September 2013. In December 2009, Mr. Mackie entered into
a Confidentiality, Non-Competition, and Invention Assignment
Agreement with ClearOne. This employment contract included
provisions preventing Mr. Mackie from competing with ClearOne
during his employment and for one year after the employment
ended and prohibiting him from soliciting ClearOne customers for
the same one-year period. There were also a number of other
provisions relating to the confidentiality of customer information
and trade secrets. Both the contract and the fiduciary duties owed by
Mr. Mackie to ClearOne were to be performed, at least in part, in
Utah and were governed by Utah law. Mr. Mackie resided in Texas
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1 As this is an appeal from the dismissal of the case under rule
12(b)(2) of the Utah Rules of Civil Procedure, ―we must ‗accept the
factual allegations in the complaint as true and consider all
reasonable inferences to be drawn from those facts in a light most
favorable to the plaintiff.‘‖ Ho v. Jim’s Enters., Inc., 2001 UT 63, ¶ 6, 29
P.3d 633 (citation omitted). The recitation of the facts complies with
this standard.
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during these events, and the only allegations as to where Mr. Mackie
performed his work for ClearOne indicates that he worked in Texas.
¶ 3 In August 2013, Mr. Mackie, while still residing in Texas,
contacted individuals at Revolabs about leaving ClearOne to work
for Revolabs. Over the next several weeks, Mr. Mackie
communicated with several individuals about this potential
transition through calls, video chats, and emails. These individuals
included: Curtiss Singleton, Revolabs‘s director of sales for the
Americas, who was located in Georgia; Marc Cremer, Revolabs‘s
chief operating officer, who was located in Massachusetts; Daniel
Kleman, Revolabs‘s field sales engineer for its western region, who
was located in California; and Jonathan McGarry, Revolabs‘s field
sales engineer for its eastern region, who was located in
Massachusetts. After several discussions and interviews, Mr. Cremer
offered Mr. Mackie a position at Revolabs on September 3, 2013,
which Mr. Mackie accepted. Mr. Mackie executed an employment
and confidentiality agreement with Revolabs on September 6, 2013,
and tendered his resignation to ClearOne on September 9, 2013,
stating that his last day would be September 20, 2013. Mr. Mackie
began working for Revolabs on September 23, 2013. No part of these
events took place in Utah.
¶ 4 On December 19, 2013, ClearOne filed suit against
Mr. Mackie in Utah district court for, inter alia, breach of the
employment agreement, which litigation remains pending in a
separate action. After learning of Revolabs‘s involvement with and
encouragement of Mr. Mackie‘s resignation, ClearOne filed suit
against Revolabs in Utah district court on July 30, 2014. ClearOne
sought damages and an injunction for Revolabs‘s alleged tortious
interference with Mr. Mackie‘s employment contract, predatory
hiring under the Utah Unfair Competition Act, and aiding and
abetting Mr. Mackie‘s alleged breach of his fiduciary duties to
ClearOne.
¶ 5 Prior to discovery being conducted, Revolabs filed a motion
to dismiss under Utah Rule of Civil Procedure 12(b)(2) for lack of
personal jurisdiction. ClearOne opposed the motion and filed its
own motion seeking jurisdictional discovery in order to determine
whether Revolabs should be subject to general jurisdiction in Utah.
As evidence in support of its claim that Revolabs had systematic and
continuous contacts with Utah, ClearOne pointed to Revolabs‘s
publicly accessible website; the fact that Revolabs is included in an
online directory of Utah businesses maintained by the Utah
Department of Workforce Services (though the site states that
Revolabs currently has no employees in Utah); and a bid solicitation
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CLEARONE v. REVOLABS
Opinion of the Court
by Utah Valley University for audio-visual equipment, including
equipment sold by Revolabs. Revolabs responded to this evidence
with an affidavit stating that it ―does not maintain or conduct any
business operations in the state of Utah and does not direct any
advertising into Utah; it has no offices in Utah, owns no property in
Utah[,] and maintains no employees in Utah.‖ ClearOne has not
disputed this statement. The trial court denied ClearOne‘s request
for discovery and granted Revolabs‘s motion to dismiss. ClearOne
appealed the trial court‘s decision.
Standard of Review
¶ 6 ClearOne raises two claims on appeal: first, the trial court
erred in dismissing Revolabs for lack of specific personal
jurisdiction. ―[T]he propriety of a 12(b)(2) dismissal is a question of
law, [and] we give the trial court‘s ruling no deference and review it
under a correctness standard.‖2 Second, the trial court erred in
denying discovery to determine whether Revolabs was subject to
general personal jurisdiction in Utah. We review the trial court‘s
decision on this issue for abuse of discretion.3 We have jurisdiction
pursuant to Utah Code section 78A-3-102(3)(j).
Analysis
¶ 7 ―The authority of the state to hale a nonresident into a state
court hinges on the ability to establish personal jurisdiction.‖4 And a
court‘s exercise of personal jurisdiction over a party must be
―consistent with the due process protections of the Fifth and
Fourteenth Amendments to the United States Constitution.‖5 There
_____________________________________________________________
2Ho v. Jim’s Enters., Inc., 2001 UT 63, ¶ 6, 29 P.3d 633 (citation
omitted).
3 See Sizova v. Nat’l Inst. of Standards & Tech., 282 F.3d 1320, 1326
(10th Cir. 2002).
4 Pohl, Inc. of Am. v. Webelhuth, 2008 UT 89, ¶ 9, 201 P.3d 944.
5 Osborne v. Adoption Ctr. of Choice, 2003 UT 15, ¶ 20, 70 P.3d 58.
The exercise of jurisdiction must also satisfy our long-arm statute.
See Anderson v. Am. Soc’y of Plastic & Reconstructive Surgeons, 807 P.2d
825, 827 (Utah 1990). Because ―our legislature has directed us to
construe [the long-arm statute] ‗so as to assert jurisdiction over
nonresident defendants to the fullest extent permitted by the due
process clause,‘‖ and as the parties have not argued over the
applicability of the statute, we can ―assume the application of the
(Continued)
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are two categories of personal jurisdiction, specific and general
jurisdiction, both of which are implicated in this case. 6 ClearOne first
argues that the trial court erred in dismissing Revolabs for lack of
specific personal jurisdiction. Alternatively, ClearOne claims that the
court abused its discretion by denying ClearOne the opportunity to
conduct discovery in order to determine whether Revolabs should
be subject to general personal jurisdiction. Below, we discuss these
two issues in turn and affirm.
I. Revolabs Is Not Subject to Specific Personal Jurisdiction in Utah
¶ 8 ―[S]pecific personal jurisdiction gives a court power over a
defendant only with respect to claims arising out of the particular
activities of the defendant in the forum state . . . .‖7 The United States
Supreme Court has interpreted the Due Process Clause of the
Fourteenth Amendment to permit a state to exercise specific
personal jurisdiction over a party only when the party has
―minimum contacts with [the state] such that the maintenance of the
suit does not offend ‗traditional notions of fair play and substantial
justice.‘‖8 ―In judging minimum contacts, a court properly focuses on
‗the relationship among the defendant, the forum, and the
litigation.‘‖9 The Supreme Court recently clarified the kind of
contacts with a state that satisfy this test in Walden v. Fiore.10 We first
address Walden and its impact on the ―effects‖ test derived from the
Supreme Court‘s decision in Calder v. Jones. In so doing, we
recognize that the Supreme Court has rejected a particular approach
to the minimum contacts test, which limits our decision in Pohl, Inc.
of America v. Webelhuth. We then apply the principles found in
Walden to the present case, which lead us to the conclusion that the
trial court was correct in dismissing Revolabs for lack of personal
jurisdiction.
statute[ ]and go straight to the due process issue.‖ Id. (citation
omitted).
6 See Pohl, 2008 UT 89, ¶ 9.
7 Pohl, Inc. of Am. v. Webelhuth, 2008 UT 89, ¶ 10, 201 P.3d 944(alteration in original) (citation omitted)
8Int’l Shoe Co. v. Wash., Office of Unemployment Comp. & Placement,
326 U.S. 310, 316 (1945) (citation omitted).
9 Calder v. Jones, 465 U.S. 783, 788 (1984) (citation omitted).
10 134 S. Ct. 1115 (2014).
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CLEARONE v. REVOLABS
Opinion of the Court
A. Walden Narrowed the Broad Interpretation of Calder
Adopted in Pohl
¶ 9 ClearOne relies almost exclusively on our 2008 decision in
Pohl, Inc. of America v. Webelhuth in support of its argument that
Revolabs is subject to specific personal jurisdiction in Utah. Pohl in
turn relied on a 1984 Supreme Court case, Calder v. Jones. The initial
issue raised by the parties is whether the Supreme Court‘s decision
in Walden altered or clarified Calder such that Pohl‘s interpretation of
Calder is no longer good law. Below, we address each case in the
order it was decided and conclude that Walden, while not overruling
Calder, significantly altered the interpretation of Calder that
supported our decision in Pohl. Accordingly, the broad
interpretation of the ―effects‖ test derived from Calder and adopted
by us in Pohl has been narrowed by Walden.
1. Calder v. Jones
¶ 10 In Calder v. Jones, the Supreme Court was called on to decide
whether two individuals, a reporter and an editor employed by the
National Enquirer magazine, were subject to specific personal
jurisdiction in California for their part in writing and editing an
allegedly defamatory article.11 The relevant contacts linking the
defendants to California were that the Enquirer circulated about
600,000 copies in California, and ―[t]he allegedly libelous story
concerned the California activities of a California resident,‖
―impugned the professionalism of an entertainer whose television
career was centered in California,‖ and ―was drawn from California
sources.‖12 Further, ―the brunt of the harm, in terms both of
respondent‘s emotional distress and the injury to her professional
reputation, was suffered in California.‖13 ―In sum, California [was]
the focal point both of the story and of the harm suffered.‖14 The
Supreme Court accordingly held that jurisdiction was ―proper in
California based on the ‗effects‘ of their Florida conduct in
California.‖15
_____________________________________________________________
11 Calder, 465 U.S. at 784–86. The article suggested that the
respondent, Shirley Jones, drank so heavily that it interfered with her
obligations as a television entertainer. Id. at 788 n.9.
12 Id. at 785, 788–89.
13 Id. at 789.
14 Id.15 Id.6
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¶ 11 As the Ninth Circuit has noted, ―[s]ubsequent cases have
struggled somewhat with Calder‘s import,‖ as the ―effects‖ language
does not clarify how foreseeable the effects must be or to what
degree the effects must impact the plaintiff or the forum state in
order to give rise to specific jurisdiction.16 One interpretation of
Calder is a minimum contact analysis known as the ―effects‖ test.17
This test has three prongs: ―the defendant must have (1) committed
an intentional act, which was (2) expressly aimed at the forum state,
and (3) caused harm, the brunt of which is suffered and which the
defendant knows is likely to be suffered in the forum state.‖18 It was
this ―effects‖ test, interpreted broadly, that we relied upon in Pohl to
reverse the trial court‘s determination that jurisdiction was
improper.19
2. Pohl, Inc. of America v. Webelhuth
¶ 12 Pohl involved a construction project in Missouri overseen by
a Missouri general contractor.20 Pohl, a Utah corporation, was
contracted to manufacture and supply panels to be installed on the
exterior of the building.21 Disputes arose over the ―production,
delivery, and payment schedule for the panels,‖ leading to Pohl‘s
contract being terminated.22 Pohl sued the general contractor and
various other subcontractors and individuals, all of whom were
based in Missouri, alleging that they had conspired to interfere with
_____________________________________________________________
16 Bancroft & Masters, Inc. v. Augusta Nat’l Inc., 223 F.3d 1082, 1087
(9th Cir. 2000).
17 At least ―two primary tests have emerged‖ from Calder: a
―restrictive view‖ that requires proof ―that the defendant target[ed]
the forum state, not merely a forum resident,‖ and a ―broad view,‖
which only requires proof ―that the defendant target[ed] a plaintiff
known to reside in the forum state.‖ Lee Goldman, From Calder to
Walden and Beyond: The Proper Application of the “Effects Test” in
Personal Jurisdiction Cases, 52 SAN DIEGO L. REV. 357, 365–66 (2015).
The Ninth Circuit‘s ―effects‖ test, which is the approach we adopted
in Pohl, is the ―broad view.‖ Id. at 366.
18 Bancroft & Masters, 223 F.3d at 1087.
19 See 2008 UT 89, ¶¶ 25–30.
20 Id. ¶ 3.
21 Id.
22 Id. ¶ 4.
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CLEARONE v. REVOLABS
Opinion of the Court
Pohl‘s contract.23 The district court dismissed the defendants for lack
of personal jurisdiction, concluding that the defendants‘ actions
―were performed exclusively in the State of Missouri‖ and,
accordingly, there was ―no nexus between Defendants‘ contacts with
Utah and Plaintiff‘s claims,‖ and the court of appeals affirmed.24 We
reversed and remanded.25
¶ 13 In reversing the court of appeals, we adopted a broad
formulation of the ―effects‖ test. We first discussed Calder, where
jurisdiction in California was appropriate because ―California [was]
the focal point both of the [defamatory] story and of the harm
suffered.‖26 We did not discuss any of the specific contacts that were
present in Calder, such as the extensive circulation of the magazine in
California or the defendants‘ use of California sources in writing the
story. We noted only that the defendants in that case ―did not go to
California to work on the story.‖27 We summarized Calder as
permitting jurisdiction ―[b]ecause the reporters knew that their tort
would cause harm in California.‖28
¶ 14 We then reviewed the ―effects‖ test derived from Calder,
which ―may be satisfied if the defendant is alleged to have
(1) committed an intentional act; (2) expressly aimed at the forum
state; (3) causing harm, the brunt of which is suffered—and which
the defendant knows is likely to be suffered—in the forum state.‖29
In describing how these prongs could be satisfied, we discussed a
Ninth Circuit case, Harris Rutsky & Co. Insurance Services v. Bell &
_____________________________________________________________
23 Id. ¶¶ 4–6.
24 Id. ¶¶ 6–7.
25 Id. ¶ 31. We did not actually determine that jurisdiction was
proper because we had announced a new standard for determining
personal jurisdiction in conspiracy cases and remanded for further
proceedings. We also reversed the trial court and court of appeals‘
conclusion that our long-arm statute did not permit jurisdiction, an
issue not raised in this case. See id. ¶¶ 12–22.
26 Id. ¶ 26 (quoting Calder, 465 U.S. at 789).
27 Id.28 Id.29Id. ¶ 27 (quoting Harris Rutsky & Co. Ins. Servs. v. Bell &
Clements Ltd., 328 F.3d 1122, 1131 (9th Cir. 2003)).
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Clements Ltd.30 In that case, the second prong of the effects test—
whether the defendant ―expressly aimed‖ conduct at the forum
state—was satisfied because ―the defendants knew that the plaintiff
corporation was a California resident, and so the alleged acts were
expressly aimed at California.‖31 The third prong—whether the
brunt of the harm was suffered in the forum state—was also satisfied
because ―the plaintiff was a California corporation with its principal
place of business in California, and the brunt of the harm was
therefore felt in California.‖32
¶ 15 Thus, although our formulation of the ―effects‖ test focused
on a defendant‘s connections to the forum state, our description of
how the test could be satisfied centered on a defendant‘s connections
with a plaintiff who resided in the forum state. Pohl‘s broad
interpretation of Calder and the ―effects‖ test permitted jurisdiction
over a defendant so long as the defendant‘s tortious act targeted a
plaintiff known to be a resident of the forum and the injury was
suffered by the plaintiff in the forum state.33 Although we did not
apply this test to the defendants in Pohl, we did hold that the
defendants‘ actions—none of which took place in Utah and none of
which had any impact in Utah other than the alleged injury to the
plaintiff—could potentially satisfy the minimum contacts analysis.34
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30 328 F.3d 1122 (9th Cir. 2003).
31 Pohl, 2008 UT 89, ¶ 27.
32 Id.33 See id. ¶ 25 (―The premise of the conclusion reached by both the
court of appeals and the trial court was that because all of the
defendants‘ allegedly tortious actions took place in Missouri, no
minimum contacts existed. This approach erroneously ignores the
fact that a tort is incomplete without an injury, and thus the place of
injury is an important component of the minimum contacts analysis.
Moreover, ‗within the rubric of ―[purposeful] availment‖ the Court
has allowed the exercise of jurisdiction over a defendant whose only
―contact‖ with the forum state is the ―purposeful direction‖ of a
foreign act having effect in the forum state.‘‖ (citation and footnote
omitted)).
34See id. ¶ 32 (―[W]e believe that jurisdiction can be established
over the defendants under the Calder ‗effects‘ test by showing that
the defendants were engaged in a conspiracy that was expressly
aimed at Utah and that the conspiracy caused harm in Utah . . . .―).
(Continued)
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CLEARONE v. REVOLABS
Opinion of the Court
Ultimately, Pohl suggests that there is no need to examine whether
the defendant had any contacts with the forum state besides the
injury felt by the plaintiff, because any intentional tort committed
against a resident of a forum state can be of itself a sufficient
minimum contact. The question before us today is whether, post-
Walden, this formulation of Calder and the ―effects‖ test remains
viable.
3. Walden v. Fiore
¶ 16 In Walden, the Supreme Court was asked ―to decide
whether a court in Nevada may exercise personal jurisdiction over a
defendant on the basis that he knew his allegedly tortious conduct in
Georgia would delay the return of funds to plaintiffs with
connections to Nevada.‖35 The plaintiffs were professional gamblers
who, when returning from a gambling trip in Puerto Rico with
almost $100,000 in cash, were stopped by Mr. Walden, a DEA agent,
in Georgia.36 Mr. Walden seized the money and, after plaintiffs
returned to Nevada, allegedly drafted and submitted a false
probable cause affidavit.37 Plaintiffs filed a Bivens suit against
Mr. Walden in Nevada, seeking money damages for the alleged
violation of their Fourth Amendment rights.38 The federal district
court dismissed the suit, concluding ―that [Mr. Walden‘s] search of
[plaintiffs] and his seizure of the cash in Georgia did not establish a
basis to exercise personal jurisdiction in Nevada,‖ because the fact
that ―petitioner caused harm to respondents in Nevada while
knowing they lived in Nevada‖ was insufficient to confer
jurisdiction.39 The Ninth Circuit reversed, holding that Mr. Walden
―‗expressly aimed‘ his submission of the allegedly false affidavit at
Nevada by submitting the affidavit with knowledge that it would
Justice Wilkins dissented from the majority opinion on essentially
these grounds. See id. ¶ 35 (Wilkins, J., dissenting) (―In this matter,
the actions complained of, while clearly impacting the Utah plaintiff,
just as clearly occurred in Missouri. None of the acts complained of
occurred in Utah.‖).
35 134 S. Ct. at 1119.
36 Id.37 Id. at 1119–20.
38 Id. at 1120.
39 Id.10
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affect persons with a ‗significant connection‘ to Nevada‖40—the same
―effects‖ test we adopted from the Ninth Circuit in Pohl.
¶ 17 The Supreme Court then reversed the circuit court‘s
decision, holding that the Ninth Circuit‘s approach ―impermissibly
allows a plaintiff‘s contacts with the defendant and forum to drive
the jurisdictional analysis.‖41 The Court, eschewing a rigid test,
looked to ―[t]wo related aspects‖ of ―the relationship among the
defendant, the forum, and the litigation‖ to determine jurisdiction42:
whether ―the relationship . . . arise[s] out of contacts that the
‗defendant himself‘‘ creates,‖ and whether those contacts are ―with
the forum State itself, not . . . with persons who reside there.‖ 43 The
first aspect means that jurisdiction cannot be predicated ―on the
‗unilateral activity‘ of a plaintiff.‖44 And the second means that ―a
defendant‘s relationship with a plaintiff or third party, standing
alone, is an insufficient basis for jurisdiction.‖45 Indeed, the Court
repeatedly emphasized that ―the plaintiff cannot be the only link
between the defendant and the forum.‖46
¶ 18 The Court turned to Calder as an example of these
principles.47 It stated that, ―[a]lthough we recognized that the
defendants‘ activities ‗focus[ed]‘ on the plaintiff, our jurisdictional
inquiry . . . examined the various contacts the defendants had
created with California (and not just with the plaintiff) by writing the
allegedly libelous story.‖48 The Supreme Court clarified that
jurisdiction in Calder was possible not because the plaintiff suffered
an injury while residing in California, but because ―the injury to the
plaintiff‘s reputation in the estimation of the California public‖
necessarily ―connected the defendants‘ conduct to California, not just
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40 Id.41 Id. at 1125.
42 Id. at 1121–22 (citation omitted).
43 Id. at 1122 (citation omitted).
44 Id. at 1123 (citation omitted).
45 Id.
46 Id. at 1122.
47 Id. at 1123.
48 Id. (second alteration in original) (citation omitted).
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CLEARONE v. REVOLABS
Opinion of the Court
to a plaintiff who lived there.‖49 ―The strength of that connection was
largely a function of the nature of the libel tort,‖ which requires
―publication to third persons.‖50 ―That connection, combined with
the various facts that gave the article a California focus,‖ such as the
plaintiff‘s work as a California television entertainer and the
defendants‘ reliance on California sources in writing the story,
permitted jurisdiction.51 Thus, at least according to the Supreme
Court in Walden, ―Calder made clear that mere injury to a forum
resident is not a sufficient connection to the forum.‖52
¶ 19 After clarifying Calder‘s holding, the Court looked to the
facts of the case before it, stating that ―no part of [Mr. Walden‘s]
course of conduct occurred in Nevada.‖53 Mr. Walden ―never
traveled to, conducted activities within, contacted anyone in, or sent
anything or anyone to Nevada.‖54 Thus, Mr. Walden ―formed no
jurisdictionally relevant contacts with Nevada‖ because none of the
―defendant‘s actions connect him to the forum.‖55
¶ 20 The Court then directed its attention to the Ninth Circuit‘s
use of the ―effects‖ test—the same broad test we adopted in Pohl. In
so doing, the Court gave guidance on how the second and third
prong of the test should be employed. First, as to ―express aiming,‖
the Court rejected the Ninth Circuit‘s finding of minimum contacts
based on Mr. Walden‘s ―direct[ion] [of] his conduct at plaintiffs
whom he knew had Nevada connections.‖56 According to the Court,
the Ninth Circuit‘s approach ―improperly attributes a plaintiff‘s
forum connections to the defendant and makes those connections
‗decisive‘ in the jurisdictional analysis.‖57 Thus, the Court clarified
that the ―express aiming‖ prong of the ―effects‖ test could not be
satisfied simply by showing that the defendant targeted an entity
known to be a resident of the forum.
_____________________________________________________________
49 Id. at 1124 (first emphasis added).
50 Id.
51 Id.
52 Id. at 1125.
53 Id. at 1124.
54 Id.
55 Id.
56 Id. at 1125.
57 Id.
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¶ 21 Then, as to the ―brunt of the injury‖ prong, the Court
rejected the plaintiffs‘ argument that jurisdiction was proper because
they ―suffered the ‗injury‘ caused by [Mr. Walden‘s] allegedly
tortious conduct . . . while they were residing in the forum.‖58 It
explained that ―an injury is jurisdictionally relevant only insofar as it
shows that the defendant has formed a contact with the forum
State.‖59 And in that case, the plaintiffs‘ injury was ―not the sort of
effect that is tethered to Nevada in any meaningful way,‖ as the
injury was felt in Nevada ―not because anything independently
occurred there, but because Nevada is where respondents chose to
be‖ when the injury occurred.60 Thus, ―[t]he proper question is not
where the plaintiff experienced a particular injury or effect but
whether the defendant‘s conduct connects him to the forum in a
meaningful way.‖61
¶ 22 Walden‘s interpretation of Calder and discussion of the
appropriate minimum contacts analysis has significantly narrowed
the broadly formulated ―effects‖ test we adopted in Pohl.62 As
discussed, our decision in Pohl adopted a broad interpretation of the
―effects‖ test that permitted jurisdiction solely on the basis of a
defendant‘s connections with a plaintiff who resided in the forum
state. Although it may still be true that jurisdiction can be premised
on the defendant‘s ―‗purposeful direction‘ of a foreign act having
effect in the forum state,‖63 Walden has clarified that the ―effect in the
forum state‖ must be more than an effect on a plaintiff in the forum
state. Other courts faced with this question have come to the same
conclusion.64 Thus, although Walden did not overrule Calder, it
_____________________________________________________________
58 Id.59 Id.60 Id.61 Id.62 See Pohl, 2008 UT 89, ¶¶ 26–27.
63 Id. ¶ 25 (emphases omitted) (citation omitted).
64 See, e.g., Maxitrate Tratamento Termico E Controles v. Super Sys.,
Inc., 617 Fed. Appx. 406, 408 (6th Cir. 2015) (―Hedman relies on
language in Calder suggesting that, if a defendant knows that its
intentional acts will cause effects in a state, then that state can
exercise jurisdiction over the defendant. . . . But the Supreme Court
rejected that theory of personal jurisdiction (and that interpretation
of Calder) last year in Walden.‖ (citation omitted)); Advanced Tactical
(Continued)
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CLEARONE v. REVOLABS
Opinion of the Court
clarified that the effects of an alleged tort must be felt by more than
just a plaintiff with significant contacts with the forum state—they
must be felt in some broader sense by the forum state itself, as was
the case with the defamatory story in Calder.65 Under Walden, the
proper application of the ―effects‖ test looks beyond both the
plaintiff‘s connections to the forum state and the plaintiff‘s injury to
whether the defendant has ―create[d] a substantial connection with
the forum State.‖66
¶ 23 Thus, to the extent that Pohl adopted an interpretation of
Calder that permitted a plaintiff to be ―the only link between the
defendant and the forum,‖ its interpretation is inconsistent with
Walden.67 Instead, we must look to whether the defendant has
minimum contacts with Utah, not just with a plaintiff residing in
Utah. We turn now to the application of these principles to the facts
of this case.
B. Under Walden’s Clarified Interpretation of Calder, Revolabs
Lacks Sufficient Minimum Contacts with Utah to Subject It to
Specific Personal Jurisdiction
¶ 24 Having discussed how Pohl‘s broad formulation of the
―effects‖ test has been narrowed by the Supreme Court‘s decision in
Walden, we turn now to a discussion of whether, under Walden,
Revolabs should be subject to personal jurisdiction in Utah. We
conclude that because Revolabs‘s only alleged contact with Utah is
the effects its alleged tortious conduct had on ClearOne, and because
the alleged tort does not otherwise create meaningful contacts with
Utah, Revolabs is not subject to personal jurisdiction in Utah.
Ordnance Sys., LLC v. Real Action Paintball, Inc., 751 F.3d 796, 802
(―[A]fter Walden there can be no doubt that ‗the plaintiff cannot be
the only link between the defendant and the forum.‘ . . . Any
decision that implies otherwise can no longer be considered
authoritative.‖ (citation omitted)).
65 See Maxitrate, 617 Fed. Appx. at 408–09; see also Picot v. Weston,
780 F.3d 1206, 1214–15 (9th Cir. 2015) (holding that there was no
jurisdiction because the tort connected the defendant only to the
plaintiff, not the forum).
66 Walden, 134 S. Ct. at 1121.
67 Id. at 1122–23 (―[A] defendant‘s relationship with a plaintiff or
third party, standing alone, is an insufficient basis for jurisdiction.‖).
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¶ 25 As stated, in order for a court to exercise personal
jurisdiction over a defendant, the defendant must have ―minimum
contacts with [the state] such that the maintenance of the suit does
not offend ‗traditional notions of fair play and substantial justice.‘‖68
In the context of an intentional tort, we apply the ―effects‖ test,
which looks to whether ―the defendant is alleged to have
(1) committed an intentional act; (2) expressly aimed at the forum
state; (3) causing harm, the brunt of which is suffered—and which
the defendant knows is likely to be suffered—in the forum state.‖69
¶ 26 When applying the ―effects‖ test, however, we must keep in
mind the two guiding principles of Walden: whether ―the
relationship [between the defendant, the litigation, and the
forum] . . . arise[s] out of contacts that the ‗defendant himself‘‘
creates,‖ and whether those contacts are ―with the forum State itself,
not . . . with persons who reside there.‖70 The Court in Walden
repeatedly cautioned that ―the plaintiff cannot be the only link
between the defendant and the forum,‖71 ―a plaintiff‘s contacts with
the defendant and forum [cannot] drive the jurisdictional analysis,‖72
and ―[t]he proper question is not where the plaintiff experienced a
particular injury or effect but whether the defendant‘s conduct
connects him to the forum in a meaningful way.‖ 73 Further, the
Court ―reiterate[d] that the ‗minimum contacts‘ inquiry principally
protects the liberty of the nonresident defendant, not the interests of
the plaintiff.‖74 Applying these principles to the case at hand, we
conclude that Revolabs has not created any jurisdictionally relevant
contacts with Utah and cannot be subject to personal jurisdiction
here.
¶ 27 The relevant facts are these: ClearOne is a Utah corporation
with its principal place of business in Utah. ClearOne and
Mr. Mackie entered into an employment contract for a technical sales
position that was governed by Utah law, though ClearOne has not
_____________________________________________________________
68 Int’l Shoe, 326 U.S. at 316 (citation omitted).
69 Pohl, 2008 UT 89, ¶ 27 (citation omitted).
70 Walden, 134 S. Ct. at 1122 (citation omitted).
71 Id.72 Id. at 1125.
73 Id.74 Id. at 1125 n.9.
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CLEARONE v. REVOLABS
Opinion of the Court
identified the location where this contract was executed. ClearOne
has also not described the location or region in which Mr. Mackie
worked and sold ClearOne products, except for a reference to a trade
show located in Texas. It is clear, however, that during the time
period relevant to the complaint, Mr. Mackey resided in Texas.
While residing (and presumably working) in Texas, Mr. Mackie
contacted Revolabs about the possibility of working for it instead of
ClearOne. A number of conversations and other communications
followed, exchanged between Mr. Mackie (in Texas) and
Mr. Singleton (in Georgia), Mr. Cremer (in Massachusetts),
Mr. Kleman (in California), and Mr. McGarry (in Massachusetts). As
a result of these communications, Mr. Mackie eventually resigned
from ClearOne and began working for Revolabs outside of Utah,
which ClearOne alleges was in violation of Mr. Mackie‘s duties
under the contract and as a fiduciary of ClearOne. These actions—
the alleged interference with a Utah contract and employment
relationship—are the only contacts that Revolabs is alleged to have
with Utah as it relates to ClearOne‘s claims.
¶ 28 Under these facts, we do not see any way in which Revolabs
expressly aimed its actions at Utah such that it created sufficient
minimum contacts with the state. ClearOne has not alleged that
Revolabs was attempting to ―enter[] a contractual relationship that
‗envisioned continuing and wide-reaching contacts‘‖ in Utah, nor
that it was ―‗deliberately exploi[ting]‘ a market‖ in Utah.75 ClearOne
has also not alleged that Revolabs physically entered Utah ―in
person or through an agent, goods, mail, or some other means.‖76 To
be sure, ClearOne has alleged that Revolabs intentionally injured
ClearOne with full knowledge that ClearOne was a Utah
corporation. But the Supreme Court has expressly rejected
knowledge of a plaintiff‘s forum connections as a sufficient
jurisdictional basis.77 To permit jurisdiction because of these
_____________________________________________________________
75 Id. at 1122 (citations omitted).
76 Id.77 Id. at 1124–25 (―Rather than assessing petitioner‘s own contacts
with Nevada, the Court of Appeals looked to petitioner‘s knowledge
of respondents‘ ‗strong forum connections.‘ In the court‘s view, that
knowledge, combined with its conclusion that respondents suffered
foreseeable harm in Nevada, satisfied the ‗minimum contacts‘
inquiry. This approach to the ‗minimum contacts‘ analysis
impermissibly allows a plaintiff‘s contacts with the defendant and
(Continued)
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allegations would return to the broad interpretation of the ―effects‖
test that was rejected in Walden.78
¶ 29 As to the ―brunt of the injury‖ prong, the alleged injury
resulting from Revolabs‘s alleged conduct ―is jurisdictionally
relevant only insofar as it shows that the defendant has formed a
contact with the forum State.‖79 Otherwise, ―mere injury to a forum
resident is not a sufficient connection to the forum.‖80 In Calder, the
injury was jurisdictionally relevant because the publication of the
allegedly libelous article necessarily connected the defendants to
California.81 As the Wyoming Supreme Court described, ―the alleged
wrongdoing, libel, was itself tied to the location into which the
words were ‗sent.‘‖82 The question here is whether there is
something ―about the nature of the alleged [misconduct] . . . [that]
inextricably links the misconduct to the location where the [injury
was felt].‖83
¶ 30 ClearOne argues that ―the epicenter of the claims and injury
in this case is Utah.‖ But its description of how Revolabs‘s alleged
misconduct is linked to Utah is instructive as to why jurisdiction is
improper:
Utah is the focal point not just because ClearOne is
headquartered in Utah, but also because the
employment contract that [Mr.] Mackie entered into
with ClearOne was and is governed by Utah law,
forum to drive the jurisdictional analysis.‖ (citation omitted)
(footnote omitted)).
78 Id. at 1122 (―We have consistently rejected attempts to satisfy
the defendant-focused ‗minimum contacts‘ inquiry by
demonstrating contacts between the plaintiff (or third parties) and
the forum State.‖).
79 Id. at 1125.
80 Id.
81 Id. at 1124 (―[T]he ‗effects‘ caused by the defendants‘ article—
i.e., the injury to the plaintiff‘s reputation in the estimation of the
California public—connected the defendants‘ conduct to California,
not just to a plaintiff who lived there.‖).
82 State ex rel. State Treasurer of Wyo. v. Moody’s Inv’rs Serv., Inc.,
349 P.3d 979, 985 (Wyo. 2015) (citation omitted).
83 Id.17
CLEARONE v. REVOLABS
Opinion of the Court
required performance by ClearOne and [Mr.] Mackie
(at least in part) in Utah. Moreover, [Mr.] Mackie‘s
fiduciary obligations were created and governed by
Utah law, were owed to a Utah company, and were to
be fulfilled, in part, in Utah. Finally, ClearOne‘s
predatory hiring claim is also subject to Utah law.
The only reason Revolabs‘s alleged misconduct is linked to Utah is
because ClearOne unilaterally chose to execute a contract governed
by Utah law, chose to incorporate in Utah, and chose to assert Utah
causes of action. Although we accept as true ClearOne‘s allegation
that the employment contract between ClearOne and Mr. Mackie
was subject to Utah law, it seems clear that Mr. Mackie‘s actual work
was not based in Utah, as the only description of the work
Mr. Mackie performed relates to Texas, where he resided at all
relevant times. Thus, although ClearOne has alleged that Revolabs
tortiously interfered with an employment contract and fiduciary
duties governed by Utah law, there are no allegations to support the
conclusion that the employment relationship or Revolabs‘s alleged
subversion of that relationship were inextricably linked to Utah in
any other way besides ClearOne‘s presence here.
¶ 31 Indeed, the fact that the contract was made under Utah law
is unavailing as the Supreme Court has held that ―an individual‘s
contract with an out-of-state party alone can[not] automatically
establish sufficient minimum contacts in the other party‘s home
forum.‖84 By the same token, interference with a contract based in
another state is likewise insufficient without any other contact
linking the defendant to the forum state. And the only other relevant
contacts ClearOne suggests that Revolabs has all turn on the Utah
contacts of ClearOne and Mr. Mackie. This type of connection is
insufficient under Walden.85 Revolabs must have contacts ―with the
forum State itself, not . . . with persons who reside there.‖86
_____________________________________________________________
84 Walden, 134 S.Ct. at 1122–23 (citation omitted).
85 Id. at 1122 (―We have consistently rejected attempts to satisfy
the defendant-focused ‗minimum contacts‘ inquiry by
demonstrating contacts between the plaintiff (or third parties) and
the forum State.‖); see also id. at 1123 (―[I]t is . . . insufficient to rely on
a defendant‘s ‗random, fortuitous, or attenuated contacts‘ or on the
‗unilateral activity‘ of a plaintiff.‖ (citation omitted)).
86 Id. (citation omitted).
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¶ 32 The Ninth Circuit confirmed this understanding in Picot v.
Weston, a recent, post-Walden case dealing with a similar claim of
tortious interference.87 In that case, Mr. Picot attempted to sue
Mr. Weston in California and accused Mr. Weston of ―making
statements to [Mr.] Coats (an Ohio resident) that caused HMR (a
Delaware corporation with offices in Ohio) to cease making
payments into two trusts (in Wyoming and Australia).‖88
―[Mr.] Weston did all this from his residence in Michigan, without
entering California, contacting any person in California, or otherwise
reaching out to California.‖89 The Ninth Circuit, quoting Walden,
stated that ―[i]n short, ‗none of [Mr.] [Weston‘s] challenged conduct
had anything to do with [California] itself‖ and found jurisdiction
improper.90 As discussed, the same analysis and result is present
here.
¶ 33 Ultimately, Revolabs‘s conduct had little to do with Utah,
even though it had a lot to do with ClearOne. There is nothing other
than ClearOne‘s contract and the fact that ClearOne happens to be
incorporated here that links Revolabs to Utah. And ClearOne‘s
unilateral activity—choosing to incorporate in Utah and maintain its
principal place of business in Utah—is an insufficient basis for
jurisdiction.91 As ClearOne‘s counsel acknowledged during oral
argument, to hold otherwise would subject Revolabs to jurisdiction
wherever ClearOne chose to incorporate. Such a result would
―impermissibly allow[] [ClearOne‘s] contacts with the defendant and
forum to drive the jurisdictional analysis.‖92 As Walden made clear,
―the plaintiff cannot be the only link between the defendant and the
forum.‖93 Accordingly, because Revolabs does not have sufficient
minimum contacts with Utah, we affirm the trial court‘s decision on
this point.
_____________________________________________________________
87 780 F.3d 1206, 1214–15 (9th Cir. 2015).
88 Id. at 1215.
89 Id.
90 Id. (third and fourth alteration in original).
91 See Walden, 134 S. Ct. at 1123.
92 Id. at 1125.
93 Id. at 1122.
19
CLEARONE v. REVOLABS
Opinion of the Court
II. ClearOne Has Not Provided Sufficient Evidence that Revolabs
Could Be Subject to General Personal Jurisdiction to Warrant
Jurisdictional Discovery
¶ 34 ClearOne‘s second argument is that, even if Revolabs is not
subject to specific personal jurisdiction, ClearOne should have the
opportunity to conduct discovery in order to determine whether
Revolabs should be subject to general personal jurisdiction. Unlike
specific personal jurisdiction, ―[g]eneral personal jurisdiction
permits a court to exercise power over a defendant without regard to
the subject of the claim asserted,‖94 and is thus also known as ―all-
purpose‖ personal jurisdiction. Because ClearOne has failed to
―present facts to the court which show why jurisdiction would be
found if discovery were permitted‖95 under the standard the
Supreme Court has set forth, we affirm the trial court‘s denial of
ClearOne‘s request for discovery. We first address the standard for
reviewing a denial of jurisdictional discovery, then discuss the
standard for determining general jurisdiction, and end by explaining
how the discovery sought by ClearOne would not provide a
sufficient basis for general jurisdiction.
¶ 35 A court ―may determine jurisdiction on affidavits alone,
permit discovery, or hold an evidentiary hearing.‖96 But the party
seeking discovery has ―the obligation to present facts to the court
which show why jurisdiction would be found if discovery were
permitted.‖97 Further, the denial of a request to conduct discovery is
reviewed for abuse of discretion, and ―[a]n appellate court will not
interfere with the trial court‘s refusal to grant discovery except upon
the clearest showing that the dismissal resulted in actual and
substantial prejudice to the litigant.‖98 Denying jurisdictional
discovery ―is not an abuse of discretion when it is clear that further
_____________________________________________________________
94 Pohl, Inc. of Am. v. Webelhuth, 2008 UT 89, ¶ 9, 201 P.3d 944(citation omitted).
95United States v. Swiss Am. Bank, Ltd., 274 F.3d 610, 626 (1st Cir.
2001).
96 Anderson v. Am. Soc’y of Plastic & Reconstructive Surgeons, 807
P.2d 825, 827 (Utah 1990).
97 Swiss Am. Bank, 274 F.3d at 626.
98 Wells Fargo & Co. v. Wells Fargo Express Co., 556 F.2d 406, 430
n.24 (9th Cir. 1977).
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discovery would not demonstrate facts sufficient to constitute a basis
for jurisdiction.‖99
¶ 36 The question, then, is whether the facts that ClearOne might
discover if its request was granted would provide a sufficient basis
for general jurisdiction. The United States Supreme Court recently
clarified in Daimler AG v. Bauman the level of contact with a state a
party must have in order to permit the state to exercise general or
―all-purpose‖ jurisdiction over the party.100 In Daimler, Argentinian
residents filed a complaint in a California federal district court
attempting to sue DaimlerChrysler Aktiengesellschaft (Daimler), a
German public stock company that manufactures Mercedes-Benz
vehicles in Germany.101 The plaintiffs argued that ―the California
contacts of Mercedes-Benz USA, LLC (MBUSA), a subsidiary of
Daimler incorporated in Delaware with its principal place of
business in New Jersey,‖ could be attributed to Daimler and thereby
permit general jurisdiction to be exercised over Daimler in
California.102 MBUSA‘s California contacts consisted of ―multiple
California-based facilities,‖ including a regional office, and a high
volume of sales of Daimler vehicles.103
¶ 37 The Supreme Court, ―assum[ing] MBUSA‘s contacts [were]
imputable to Daimler,‖ held that there was ―no basis to subject
Daimler to general jurisdiction in California, for Daimler‘s slim
contacts with the State hardly render it at home there.‖104 This was a
reaffirmation that general jurisdiction is appropriate only when a
_____________________________________________________________
99 Id.100 134 S. Ct. 746, 760–62 (2014).
101 Id. at 750–51. The complaint alleged that Daimler collaborated
with Argentinian state security forces during Argentina‘s ―Dirty
War‖ in order to kidnap, detain, torture, and kill the plaintiffs or
close relatives of the plaintiffs. Id. at 751.
102 Id. at 751–52.
103Id. at 752. MBUSA was ―the largest supplier of luxury vehicles
to the California market,‖ and its California sales accounted for
―over 10% of all sales of new [Daimler] vehicles in the United States‖
and ―2.4% of Daimler‘s worldwide sales.‖ Id.104 Id. at 760. The Supreme Court assumed but did not decide
whether MBUSA‘s contacts with California were sufficient to
establish general personal jurisdiction over MBUSA. Id. at 758.
21
CLEARONE v. REVOLABS
Opinion of the Court
―corporation‘s ‗affiliations with the State are so ―continuous and
systematic‖ as to render [it] essentially at home in the forum
State.‘‖105 In so holding, the Court expressly rejected the ―doing
business‖ test, which purported to subject a corporation to general
jurisdiction ―in every State in which a corporation ‗engages in a
substantial, continuous, and systematic course of business.‘‖106
Instead, the Court clarified that a defendant‘s contacts with the state
must be so extensive as to be ―comparable to a domestic enterprise in
that State,‖107 with the paradigmatic examples being a corporation‘s
―place of incorporation and principal place of business.‖108 Although
the Court did ―not foreclose the possibility that in an exceptional
case‖109 a company could be considered ―at home‖ elsewhere, it
cautioned that ―[a] corporation that operates in many places can
scarcely be deemed at home in all of them.‖110 Thus, despite the
significant number of facilities located in California and amount of
_____________________________________________________________
105 Id. at 761 (alteration in original) (citation omitted).
106 Id. at 760–61 (citation omitted). The Court called this
formulation of the general jurisdiction test ―unacceptably grasping.‖
Id. at 761.
107 Id. at 758 n.11.
108 Id. at 760.
109 Id. at 761 n.19. The case cited by the Supreme Court as an
―exceptional case,‖ Perkins, is instructive, as it is both ―exceptional‖
and the only case decided by the Supreme Court permitting general
jurisdiction. See id. at 756 & n.8 (discussing Perkins v. Benguet Consol.
Mining Co., 342 U.S. 437 (1952)). In Perkins, the defendant company
was incorporated and had its principal place of business in the
Philippines until it was forced to suspend its operations during
World War II. Perkins, 342 U.S. at 448. During the war, the president
of the company moved to Ohio, where he kept an office, maintained
the company‘s files, and oversaw the company‘s activities. Id. As the
Supreme Court explained, general jurisdiction was possible ―because
‗Ohio was the corporation‘s principal, if temporary, place of
business.‘‖ Daimler, 134 S. Ct. at 756 (citation omitted). See also id. at
756 n.8 (confirming that the company in Perkins was ―at home‖ in
Ohio because ―[t]o the extent that the company was conducting any
business during and immediately after the Japanese occupation of
the Philippines, it was doing so in Ohio‖ and ―Ohio was the center of
the corporation‘s wartime activities‖).
110 Daimler, 134 S. Ct. at 762 n.20.
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business transacted in California, such activity was insufficient to
consider Daimler ―at home‖ in California.
¶ 38 When ClearOne‘s request for discovery is viewed in the
light of the high standard for general personal jurisdiction set by the
United States Supreme Court, it is clear that further discovery could
not lead to ―facts sufficient to constitute a basis for jurisdiction.‖
Indeed, the Supreme Court stated that ―it is hard to see why much in
the way of discovery would be needed to determine where a
corporation is at home.‖111 This is true because, as ClearOne
concedes, the question of general personal jurisdiction turns on
whether the in-state activities of a company—Revolabs in this case—
―closely approximate the activities that ordinarily characterize a
corporation‘s place of incorporation or principal place of
business.‖112 The facts and allegations provided by ClearOne fall far
short of this level of activity.
¶ 39 The facts alleged by ClearOne in support of its claim of
jurisdiction are that Revolabs has a publicly accessible website, that
Revolabs is included in an online directory of Utah businesses
maintained by the Utah Department of Workforce Services—though
the site states that Revolabs currently has no employees in Utah—
and that Utah Valley University issued a bid solicitation for audio-
visual equipment, including equipment sold by Revolabs. ClearOne
has not, however, contradicted Revolabs‘s affidavit statement that
―Revolabs does not maintain or conduct any business operations in
the state of Utah and does not direct any advertising into Utah; it has
no offices in Utah, owns no property in Utah[,] and maintains no
employees in Utah.‖ ClearOne‘s only response is that discovery may
reveal that Revolabs gains revenue from Utah, that Revolabs may be
party to Utah contracts, or that Revolabs may have conducted
business prior to litigation—facts that ClearOne argues are
suggested by Revolabs‘s website, the online directory, and the bid
solicitation.
_____________________________________________________________
111 Id.; see also id. at 760 (setting place of incorporation and
principal place of business as paradigm bases for general jurisdiction
because ―[t]hose affiliations have the virtue of being unique . . . as
well as easily ascertainable‖).
112 Carmouche v. Tamborlee Mgmt., Inc., 789 F.3d 1201, 1205 (11th
Cir. 2015).
23
CLEARONE v. REVOLABS
Opinion of the Court
¶ 40 The problem with ClearOne‘s argument is that it claims
general jurisdiction could be predicated on Revolabs‘s potentially
―substantial and continuous business activity in Utah.‖ This ―doing
business‖ approach to general jurisdiction, however, was expressly
considered and flatly rejected by the Supreme Court as part of its
holding in Daimler.113 Indeed, activity exponentially more extensive
than what ClearOne suggests Revolabs may be engaged in was
considered ―slim‖ in Daimler, and ―plainly [did] not approach‖ the
level of association necessary for general jurisdiction.114 ―A
corporation‘s ‗continuous activity of some sort[] within a state . . . is
not enough to support the demand that the corporation be amenable
to suits unrelated to that activity.‘‖115 The limited number of
Supreme Court cases on this point clearly require something more
than just some revenue or contracts to qualify the company as ―at
home‖ in that state.116
_____________________________________________________________
113 See Daimler, 134 S. Ct. at 760–61 (―Plaintiffs would have us look
beyond the exemplar bases [of place of incorporation and principal
place of business] and approve the exercise of general jurisdiction in
every State in which a corporation ‗engages in a substantial,
continuous, and systematic course of business.‘ That formulation, we
hold, is unacceptably grasping.‖ (citation omitted)).
114 Id. at 760, 761 n.19.
115Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S. Ct. 2846,
2856 (2011) (citation omitted).
116 Compare Daimler, 134 S. Ct. at 756 n.8 (general jurisdiction
present in Perkins because ―Ohio was the center of the corporation‘s
wartime activities‖), with id. at 752 (no general jurisdiction when
company had ―multiple California-based facilities, including a
regional office,‖ and had a significant volume of sales in California),
Goodyear, 131 S. Ct at 2852 (no general jurisdiction when companies
―ha[d] no place of business, employees, or bank accounts in North
Carolina,‖ did ―not design, manufacture, or advertise their products
in North Carolina,‖ and did ―not solicit business in North Carolina
or themselves sell or ship [products] to North Carolina customers,‖
even if ―a small percentage of [the companies‘ products] . . . were
distributed within North Carolina‖), and Helicopteros Nacionales de
Colombia, S.A. v. Hall, 466 U.S. 408, 416 (1984) (no general jurisdiction
when a company‘s ―contacts with Texas consisted of sending its
chief executive officer to Houston for a contract-negotiation session;
accepting into its New York bank account checks drawn on a
(Continued)
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¶ 41 The Supreme Court was clear that bases for general
jurisdiction aside from the corporation‘s place of incorporation and
principal place of business should be found only in exceptional
cases, and this does not appear to be one. Indeed, as a matter of
common sense, there are likely many companies that have no official
operations in Utah that still derive some revenue from Utah
consumers. It would strain the Supreme Court‘s standard for general
jurisdiction beyond recognition to suggest that a company like
Revolabs that has no business operations in a state can fairly be said
to be ―at home‖ there because of some potential revenue or
contracts. Accordingly, because ClearOne has failed to show that
discovery would lead to facts proving that Revolabs is ―at home‖ in
Utah, we hold that the trial court did not abuse its discretion in
denying ClearOne‘s discovery request.
Conclusion
¶ 42 The Supreme Court‘s recent cases provide clear guidance as
to the issues that we address today. Walden has clarified Calder‘s
―effects‖ test and, under Walden, ClearOne has failed to allege that
Revolabs has sufficient minimum contacts to subject it to specific
personal jurisdiction in Utah. Revolabs‘s connection to ClearOne and
Mr. Mackie is simply insufficient, on its own, to confer jurisdiction.
As to general personal jurisdiction, the Supreme Court in Daimler
clearly rejected the ―doing business‖ test that was the basis for
ClearOne‘s claim. As it is clear that no further discovery could lead
to facts supporting general jurisdiction, the trial court did not abuse
its discretion in denying ClearOne‘s motion. Accordingly, we affirm
the trial court‘s decision as to both issues.
Houston bank; purchasing helicopters, equipment, and training
services . . . ; and sending personnel to [Texas] for training‖).
25