Emerson Elec. Co. v. Suzhou Cleva Elec. Appliance Co.

Emerson Elec. Co. v. Suzhou Cleva Elec. Appliance Co.

Opinion

MEMORANDUM AND ORDER

This matter is before the Court on the Motion for Summary Judgment of Non-Infringement [*2]  as to Suzhou Cleva Electric Appliance Co., Ltd. ("Suzhou Cleva") and Cleva Hong Kong Limited ("Cleva Hong Kong"). (Doc. 229). Emerson consents to judgment being entered in favor of Suzhou Cleva but opposes the motion as to Cleva Hong Kong. (Doc. 249). For the following reasons, I will grant the motion as to Suzhou Cleva and deny it as to Cleva Hong Kong.

I. Factual Background¹

Emerson is the owner of several patents related to wet/dry vacuum cleaners. Emerson has brought claims based on six of these patents against Defendants Suzhou Cleva, Cleva Hong Kong, Cleva North America, Inc., and Sears, Roebuck & Co. Emerson alleges that Defendants make, sell, offer to sell, or import various wet/dry vacuums (the "Accused Products") that infringe Emerson's patents.

Cleva Hong Kong is a company organized under the laws of Hong Kong. Cleva Hong Kong purchases Accused [*3]  Products in China from a manufacturer in China, and it sells various Accused Products to customers based in the United States, including Sears. For example, Cleva Hong Kong is a party to a January 2012 Supply Agreement in which the "Seller" is listed jointly as Cleva Hong Kong and Cleva North America and the "Buyer" is listed as several Sears and Kmart entities in Illinois.² The Supply Agreement states, "Seller agrees to sell to Buyer the products listed in the attached Exhibit A," and Exhibit A lists various Accused Products.

Cleva Hong Kong is not directly involved in reaching out to North American customers or negotiating the terms of sales contracts with those customers; those matters are handled by Cleva North America. However, Cleva Hong Kong arranges the shipment and delivery of the Accused Products to Sears and other companies, prepares invoices, and receives payment. For example, Cleva Hong Kong delivers products directly to Sears, and Sears pays Cleva Hong Kong. When Cleva Hong Kong delivers products to its U.S.-based customers, the "Destination" is listed as "USA," but the shipping is done FOB China or FOB Shanghai.³ Although the Supply Agreement lists prices for some products to be shipped FOB Alabama, Cleva Hong Kong's corporate deponent testified that those products should be purchased from Cleva North America and not from Cleva Hong Kong.

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