MD Model Train Manufacturer’s Lawsuit Derailed By Lack of Personal Jurisdiction

Monday, November 28, 2016

Maryland-based model train manufacturer Mike’s Train House (“MTH”) sued Metropolitan Transportation Authority (“MTA”) of New York seeking declaratory judgment of non-infringement of MTA’s trademarks, and trademark cancellation under the Lanham Act.  U.S. District Court Judge Frederick Motz held that MTA’s cease-and-desist letters to MTH were insufficient to invoke specific personal jurisdiction and did not constitute “transact[ing] business” under Maryland’s long-arm statute.  Further, MTA’s third-party license agreements, from which MTA derived revenue through licensees’ sales in Maryland, did not justify the exercise of personal jurisdiction because the agreements did not (i) impose specific enforcement requirements on MTA or its licensees or (ii) grant MTA control over the licensees’ sales or marketing activities.  Finally, MTA’s Internet sales into Maryland were ruled “largely irrelevant for the jurisdictional analysis in the declaratory judgment context.”