CollegeSource v. AcademyOne

Misappropriation of material by an agent, not in the forum, on behalf of a defendant, also not in the forum, may still provide sufficient grounds for a court to find specific personal jurisdiction in the forum.

CollegeSource, a California corporation, sued AcademyOne, a Pennsylvania corporation, in federal district court in California for misappropriating material from CollegeSource’s website. After failing to create a business partnership with CollegeSource, AcademyOne contracted with a Chinese company to access CollegeSource’s website and copy material. AcademyOne moved for, and was granted, a dismissal for lack of personal jurisdiction. On appeal, CollegeSource argued that the California district court was an appropriate forum because it had general personal jurisdiction over AcademyOne. In support, CollegeSource pointed to the fact that AcademyOne misappropriated the material in California, marketed its services to California consumers, and had users and subscribers in California. The Ninth Circuit however ruled that AcademyOne failed to meet the exacting standard needed to establish general jurisdiction resulting from continuous and systematic forum activity. In the alternative CollegeSource argued that AcademyOne had “sufficient minimum contacts” with California to establish specific personal jurisdiction. Focusing on the misappropriation claim, the Ninth Circuit held that the district court did have specific personal jurisdiction over AcademyOne. First, AcademyOne had purposefully directed its activities at the forum state by acting intentionally in aiming its activities at California knowing its actions would harm CollegeSource. Next, the misappropriation claims arose out of AcademyOne’s forum related activities listed under the first prong. Lastly, the Court held the exercise of jurisdiction comported with “fair play and substantial justice” as AcademyOne failed to present a compelling case that jurisdiction was unreasonable because of the ease of travel and availability of communication technology. REVERSED and REMANDED.