MEMORANDUM OPINION
Pending before the Court is Defendants ASUS Technology Pte Ltd. (“ASUS Singapore”) and ASUSTek Computer Inc.’s (“ASUS Taiwan,” collectively the “Foreign Defendants”) motion to dismiss for lack of personal jurisdiction and improper venue. (D.I. 25) For the reasons discussed below, the Court will deny the Foreign Defendants’ motion.
PROCEDURAL BACKGROUND
I. The 2012 Action (C.A. No. 12-210-LPS)
Plaintiff Graphics Properties Holdings, Inc. (“GPH”) filed an action against ASUS Computer International (“ASUS California”), ASUS Singapore, and ASUS Taiwan on February 1, 2012. (C.A. No. 12-210 D.I. 1) GPH filed an Amended Complaint on March 27, 20.12. (Id. at D.I. 8) In its Amended Complaint, GPH asserted U.S. Patent Nos. 5,896,119 (the “ '119 patent”), 6,816,145 (the “ '145 patent”), and 8,144,158 (the “ '158 patent”) against all three defendants. The defendants collectively moved to dismiss the action for lack of jurisdiction or, in the alternative, to transfer. (Id. at D.I. 11)
On October 11, 2012, the Court heard oral argument on the motion and denied
II. The 2013 Action (C.A. No. 13-864-LPS)
On May 17, 2013, GPH filed a second action against ASUS California, ASUS Taiwan and ASUS Singapore. (D.I. 1) GPH amended this complaint on July 19, 2013. (D.I. 7) In this Amended Complaint, GPH asserted that ASUS tablets, including the Nexus 7, infringe U.S. Patent Nos. 6,650,-327 (the “ '327 patent”) and 5,717,881 (the “ '881 patent”). The Foreign Defendants filed their motion to dismiss for lack of personal jurisdiction on December 31, 2013. (D.I. 25)
FACTUAL BACKGROUND
ASUS Taiwan is a Taiwanese corporation with its principal place of business in Taiwan. (C.A. 12-210 D.I. 14 at ¶2) The accused products are designed and manufactured in Taiwan or China. (Id. at ¶ 8) ASUS Taiwan does not directly sell the accused products in Delaware. (Id. at ¶ 9) Instead, it sells title to the products to ASUS Singapore in Taiwan or China. (Id. at ¶ 10)
ASUS Singapore is a Singaporean corporation that is 100% owned by ASUS Taiwan and has its principal place of business in Singapore. (See D.I. 29 Ex. 4 at 101; C.A. No. 12-210 D.I. 15 at ¶ 2) ASUS Singapore does not directly sell the accused products in Delaware either. (C.A. No. 12-210 D.I. 15 at ¶ 9) Instead, the accused products sold in the United States are first sold by ASUS Singapore to ASUS California. (Id. at D.I. 16 at ¶ 9)
ASUS California is 100% owned by ASUS Taiwan. (See D.I. 29 Ex. 4 at 100) ASUS California generally receives products from ASUS Singapore at ports or airports in California. (C.A. No. 12-210 at ¶ 10) ASUS California then sells the products to resellers throughout the United States, including Delaware. (See, e.g., D.I. 29 ¶ 6) ASUS California does not contest jurisdiction in Delaware.
LEGAL STANDARDS
Pursuant to Federal Rule of Civil Procedure 12(b)(2), a party may move to dismiss a case based on the court’s lack of personal jurisdiction over that party. Determining the existence of personal jurisdiction requires a two-part analysis — one statutory and one constitutional.
When a defendant moves to dismiss a lawsuit for lack of personal jurisdiction, the plaintiff bears the burden of showing the basis for jurisdiction. See Power Integrations, Inc. v. BCD Semiconductor,
DISCUSSION
I. The Delaware Long-Arm Statute
The Delaware long-arm statute, in relevant part, states that:
(c) As to a cause of action brought by any person arising from any of the acts enumerated in this section, a court may exercise personal jurisdiction over any nonresident, or a personal representative, who in person or through an agent:
(1) Transacts any business or performs any character of work or service in the State; ...
(4) Causes tortious injury in the State or outside of the State by an act or omission outside the State if the person regularly does or solicits business, engages in any other persistent course of conduct in the State or derives substantial revenue from services, or things used or consumed in the State....
10 Del. C. § 3104. GPH does not allege that jurisdiction exists under any one prong of Delaware’s long-arm statute. Instead, GPH asserts that personal jurisdiction exists under a “dual jurisdiction” or “stream of commerce” theory that implicates two portions of the long-arm statute: subsection (c)(1) and (c)(4).
The Delaware long-arm statute “has been broadly construed to confer jurisdiction to the maximum extent possible under the due process clause.” LaNuova, D & B, S.p.A v. Bowe Co.,
It is conceivable that a tort claim could enjoy a dual jurisdictional basis under (c)(1) and (c)(4) if the indicia of activity set forth under (c)(4) were sufficiently extensive to reach the transactional level of (c)(1) and there was a nexus between the tort claim and transaction of business or performance of work.
Id. at 768 n. 3. Subsequently, Delaware Superior Court cases have held that this footnote stands for the proposition that “when a [defendant] has sufficient general contacts with Delaware and the plaintiffs’ claims arise out of those contacts,” even if no subsection of the long-arm statute is fully satisfied, “jurisdiction is appropriate under [partial satisfaction of] § 3104(c)(1) and (e)(4).” Boone v. Oy Partek Ab,
In applying LaNuova, Boone, and Wright, this Court has held that “[t]he dual jurisdiction concept arises from at least partial satisfaction of subsections (1) and (4) of the Delaware long-arm statute .... Dual jurisdiction may be established when a manufacturer, has sufficient general contacts with Delaware and the plaintiffs’ claims arise out of those contacts.” Belden Techs., Inc. v. LS Corp.,
In at least one recent decision, another Judge in this District reached a contrary conclusion, predicting that the Delaware Supreme Court would-not embrace the “dual jurisdiction” theory. See Round Rock Research LLC v. ASUSTeK Computer Inc.,
the (c)(1) and (c)(4) subsections involve overlapping concepts, and there thus might be times when the set of facts that establishes general jurisdiction under (c)(4) also establishes specific jurisdiction under (c)(1), and thus the jurisdiction would be “dual.” Perhaps an interesting observation, but one meaningless for development of the law, and hence properly relegated to a footnote.
Id. at 976. Round Rock further explained that although the Delaware Superior Court has adopted the dual jurisdiction theory, in doing so
the Superior Court was consistent with one principle of the Supreme Court (the long arm statute should reach non-residents to the maximum extent possible) but was inconsistent with two other principles (the long arm statute should be separately analyzed from due process considerations, and its interpretation should flow from the statutory language).
Id. Accordingly, Round Rock held that it could not “agree, or predict, that the Delaware Supreme Court would recognize ‘dual jurisdiction.’ ” Id. at 977; see also Liqui-Box Corp. v. Scholle Corp.,
In light of the differing views on this issue, the Court must first address whether it will continue to apply the dual jurisdiction theory of personal jurisdiction under the Delaware long-arm statute. Be- ’ cause the Delaware Supreme Court has not. expressly decided the issue, the Court’s role here is limited to “predicting] how that tribunal would rule” on this issue of state law. In re Makowka,
The Delaware Supreme Court has had several opportunities to reject the dual jurisdiction theory but has refrained from doing so. See Boone,
Moreover, it is uncontested that “Delaware’s long arm statute ... is to be broadly construed to confer jurisdiction to the maximum extent possible under the Due Process Clause.” Hercules Inc. v. Leu Trust & Banking (Bah.) Ltd.,
Given this record, and particularly the fact that no Delaware state court has rejected the assertion of personal jurisdiction under the dual jurisdiction theory, the Court concludes that the Delaware Supreme Court, if faced with the issue, would hold that the “stream-of-commerce” theory does provide a basis for personal jurisdiction under Delaware law, even though the theory is not expressly authorized by Delaware’s long-arm statute. The Court reaches this conclusion notwithstanding the contrary, and not unreasonable, prediction of a fellow Judge of this Court.
The Court must next determine whether the Foreign Defendants are subject to jurisdiction under the theory of “dual jurisdiction.” “[T]he dual jurisdiction analysis requires a showing of both: (1) an intent to serve the Delaware market; and (2) that this intent results in the introduction of the product into the market and that plaintiffs cause of action arises from injuries caused by that product.” Belden Techs., Inc.,
“A non-resident firm’s intent to serve the United States market is sufficient to establish an intent to serve the Delaware market, unless there is evidence that'the firm intended to exclude from its marketing and distribution efforts some portion of the country that includes Delaware.” Power Integrations,
Here, the record shows that the Foreign Defendants target the United States market by selling to ASUS California, which then sells the accused products to resellers for distribution across the United States. Of key significance is the fact that there are at least three physical resale outlets (Best Buy stores) inside Delaware that stock and sell the accused devices (D.I. 29 at ¶ 6), and the record reflects that the Foreign Defendants are aware of and actively utilize these reseller outlets to sell the accused devices (D.I. 29 Ex. 1). Hence, there is evidence not only of the Foreign Defendants targeting the United States generally but also of them targeting Delaware specifically. The evidence of sales in Delaware also satisfies the second prong of the statutory analysis, as it demonstrates that the Foreign Defendants’ intent resulted in the introduction of the accused devices in Delaware. (See D.I. 29 at ¶ 6)
II. Due Process
Having determined that this Court has jurisdiction under Delaware’s long-arm statute, the Court must next determine if “subjecting the nonresident defendant to jurisdiction in Delaware violates the Due
In Asahi,
The “substantial connection” between the defendant and the forum State necessary for a finding of minimum contacts must come about by an action of the defendant purposefully directed toward the forum State. The placement of a product into the stream of commerce, without more, is not an act of the defendant purposefully directed toward the forum State.
Id. at 112,
In Beverly Hills Fan Co. v. Royal Sovereign Corp.,
More recently, in J. McIntyre Machinery, Ltd. v. Nicastro, — U.S. -,
In its decisions, the Federal Circuit has emphasized the general proposition “that a court should not decide a legal issue when doing so is unnecessary to resolve the case
The O’Connor test is satisfied when a party engages in “[additional conduct ... [to] indicate an intent or purpose to serve the market in the forum State, [such as] ... advertising in the forum State, establishing channels for providing regular advice to customers in the forum State, or marketing the product through a distributor who has agreed to serve as the sales agent in the forum. State.” Asahi,
III. “Arising From”
The Foreign Defendants raise a further challenge to this Court’s exercise of jurisdiction. According to the Foreign Defendants, GPH’s complaint fails to satisfy the “arising from” language of the Delaware long-arm statute. Section 3104(c) provides that “[a]s to a cause of action brought by any person arising from any of the acts enumerated in this section, a court may exercise personal jurisdiction over any nonresident.” 10 Del. C. § 3104(c) (emphasis added). It follows from this “arising from” language that “[t]he court cannot base jurisdiction on events that occurred after the filing of [the] complaint.” Intel Corp. v. Silicon Storage Tech., Inc.,
GPH concedes that no Foreign Defendant performs any relevant acts in Delaware; instead, GPH relies upon acts by third parties, such as Best Buy, in Delaware. (D.I. 28 at 3-5) Hence, GPH is left to allege not direct infringement but only indirect infringement by the Foreign Defendants. Indirect infringement, whether contributory or induced, “requires knowledge of the existence of the patent that is infringed,” Global-Tech Apps., Inc. v. SEB SA,
However, “[t]he ‘arising from’ language in 10 Del. C. § 3104(c) [only] requires [that] the defendant’s act set in motion a series of events which form the basis for the cause of action before the court.” Sprint Nextel Corp. v. IPCS, Inc.,
■ The Foreign Defendants do correctly note that, to this point, GPH has only provided facts showing sales of accused devices in Delaware five months after the filing of the Complaint. Facts showing that the accused devices were on sale in Delaware prior to the filing of this suit will be required to sustain this Court’s exercise of jurisdiction over the Foreign Defendants. Thus, although the Court is denying the Foreign Defendants’ motion at this point, the Court will be prepared to reevaluate whether it can properly exercise jurisdiction over the Foreign Defendants as the case proceeds.
CONCLUSION
For the reasons stated above, the Court will deny the Foreign Defendants’ motion to dismiss. An appropriate Order follows.
ORDER
At Wilmington this 29th day of September, 2014:
For the reasons set forth in the Memorandum Opinion issued this date, IT IS HEREBY ORDERED that Defendants’ Motion to Dismiss for Lack of Jurisdiction Over the Person (D.I. 25) is DENIED.
Notes
. With regard to the statutory inquiry, the court applies the law of the state in which the district court is located; as to the constitutional inquiry, in a patent case the court applies the law of the Federal Circuit. See Auto-genomics, Inc. v. Oxford Gene Tech. Ltd.,
. Subsection (c)(1) confers “specific” jurisdiction over a non-resident defendant; subsection (c)(4) confers “general” jurisdiction. See, e.g., LaNuova D & B, S.p.A. v. Bowe Co.,
. Delaware does not have an intermediate appellate court. Decisions of Delaware's trial courts Superior, Chancery, and Family Court are subject to appellate review only by the Delaware Supreme Court. See generally Del. Code Ann. tit. 10, §§ 141-50, 341-51, 541-46, 921-29.
