Advanced Tactical Ordnance Systems, LLC v. Real Action Paintball, Inc. (May

9, 2014)

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Nature of the Case

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Facts

Advanced (P) manufactures and sells PepperBall branded items, including PepperBall projectile irritants. Its headquarters is allegedly in Indiana, though that is less clear than it might be-the company appears to have at least one office in California. P acquired trademarks and other property in a foreclosure sale from a company called PepperBall Technologies Inc. PepperBall Technologies Inc. was located in California. Before the foreclosure, PepperBall Technologies had purchased its irritant projectiles from at least two sources: Perfect Circle, half owner of P, and a Mexican company called APON. After P acquired the rights, APON stopped work. APON's chief operating officer, Conrad Sun, a citizen of California, contacted D, a California company, to see if Real Action was interested in acquiring irritant projectiles from APON. The parties concluded their deal in August 2012, after which D posted on its website and sent through its email list an announcement that it had acquired the “machinery, recipes, and materials once used by PepperBall Technologies Inc.” P fired off a cease-and-desist letter. In response, D added a disclaimer to the original message, stating that it was neither associated nor affiliated with PepperBall Technologies and its brands and that D projectiles were not made by the current PepperBall Technologies. P filed this suit in the District Court for the Northern District of Indiana. The complaint alleged personal jurisdiction under Indiana's long-arm statute. P claimed that D was doing business in Indiana, via an interactive website capable of accepting orders from citizens of Indiana; engaging in tortious acts outside Indiana while knowing they would harm citizens of Indiana; causing damage in Indiana while deriving substantial revenue from goods sold in Indiana; and conspiring to engage in tortious conduct calculated to harm a citizen of Indiana. P also noted that D regularly emailed customers or potential customers from all over the United States, including Indiana, and that it had made at least one sale to an Indiana resident. The court concluded that personal jurisdiction was proper and that P was entitled to a preliminary injunction. D under 28 U.S.C. § 1292(a)(1), contesting both the personal jurisdiction ruling and the injunctive relief.