This Week on the Ninth: National Contacts | Morrison & Foerster LLP – Left Coast Appeals

This week, the Ninth Circuit is considering a personal jurisdiction case involving a Vietnamese music company.

LANG VAN, INC. vs. VNG CORPORATION
The Court finds that the exercise of personal jurisdiction over a Vietnamese company was appropriate under Rule 4(k)(2) when the plaintiff’s federal claims alleged substantial activity directed deliberately at the United States, including more of 320,000 app downloads by US customers, US trademark registration, and longstanding efforts to partner with US companies.

Panel: Judges Bybee, Bennett and Bataillon (D. Neb.), Judge Bataillon writing the opinion.

Highlight: “The Court finds that there is substantial evidence of intentional orientation towards the American market. This evidence clearly supports the jurisdiction of Rule 4(k)(2). Respondent’s position is not only inconsistent but unreasonable in this regard. Jurisdiction, pursuant to Rule 4(k)(2), is reasonable given the Respondent’s contacts with the United States.

Background: Lang Van Inc. is a California company that produces and distributes Vietnamese music. VNG is a Vietnamese company that makes Zing MP3, a music download site and app available through Google Play and Apple’s App Store. Lang Van sued VNG for copyright infringement in federal court in California. The district court dismissed, finding that VNG’s contacts with California were insufficient to warrant specific jurisdiction, but not determining whether VNG deliberately directed its activities toward the United States as a whole.

Result: the ninth inverted circuit. Since Lang Van filed a federal lawsuit and VNG asserted that it was not subject to the personal jurisdiction of any state in the United States, the Court analyzed personal jurisdiction over VNG under the Federal Rule of Civil Procedure 4(k)(2). Under this rule, the Court explained, “rather than examining contact between the . . . [defendants] and the forum state, we consider contacts with the nation as a whole.

In reviewing all of VNG’s domestic contacts, the Court concluded that the exercise of personal jurisdiction over VNG was permitted under Rule 4(k)(2). VNG deliberately targeted American companies and their intellectual property by specifically looking for American-made music (including the complainant’s songs) and launching its English-language Zing MP3 app in the United States, where it was downloaded over 320 000 times. VNG has made no effort to block US users from its services. On the contrary, it actively sought licensing partnerships with American companies, boasting on a US trademark application that it had a “long-term plan for legal cooperation with rights holders.” . . in the West” and a long record “since 2012” of “licensing contracts signed” and “cooperation agreements” with “American studios”. The Court concluded that this “substantial evidence of intentional orientation to the US market” “clearly supports the jurisdiction of Rule 4(k)(2)”.

The Court also rejected VNG’s alternative forum non conveniens argument, finding that Vietnam was not an appropriate forum for U.S. copyright claims brought by a California company where the “alleged illegal activities [were] deliberately directed to the United States.

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