## Facts

- Toys “R” Us, Inc. and Geoffrey, Inc. (Toys) owned and used “Imaginarium” trademarks in the United States and operated Imaginarium stores and shop-in-shops, including locations in New Jersey.
- Step Two, S.A. and Imaginarium Net, S.L. (Step Two) were Spanish companies operating “Imaginarium” toy stores outside the United States and using the Imaginarium name on Internet websites.
- Toys sued Step Two in the District of New Jersey alleging Lanham Act violations (trademark infringement, unfair competition, misuse of trademark notice, and cybersquatting) and related state-law claims.
- Step Two had no U.S. retail stores, did not pay U.S. taxes, and did not engage in traditional U.S. advertising.
- Step Two operated interactive websites allowing users to view products and place orders; ordering was in Spanish, and Step Two asserted it did not ship merchandise outside Spain.
- Toys alleged the websites were used to commit the complained-of trademark and related violations and suggested Step Two directed activity toward the United States and possibly New Jersey.
- Toys also identified non-Internet contacts, including Step Two’s purchases from U.S. suppliers and attendance by Step Two’s president at U.S. toy fairs.
- Step Two moved to dismiss for lack of personal jurisdiction; Toys sought jurisdictional discovery to develop facts about Step Two’s contacts with New Jersey and the United States.
- The district court denied jurisdictional discovery and dismissed for lack of personal jurisdiction.

## Issues

1. Whether the district court abused its discretion by denying jurisdictional discovery and dismissing for lack of personal jurisdiction.
2. What showing is required to obtain jurisdictional discovery in a case alleging specific jurisdiction based on an interactive website plus limited non-Internet contacts.
3. Whether operation of an interactive website accessible in the forum, without more, supports specific personal jurisdiction over a foreign defendant.

## Decision

- The Third Circuit reversed the denial of jurisdictional discovery and the dismissal for lack of personal jurisdiction.
- The case was remanded for limited jurisdictional discovery concerning Step Two’s business activities in the United States and for reconsideration of personal jurisdiction after discovery.
- The court did not decide the ultimate jurisdiction question, leaving it for the district court to reassess on a fuller record.

## Legal Principles

- Specific personal jurisdiction requires minimum contacts showing the defendant purposefully availed itself of the forum and that the claims arise out of or relate to those forum-directed contacts.
- An interactive website’s accessibility in the forum is insufficient, by itself, to establish specific jurisdiction; there must be evidence of purposeful targeting of the forum or transactions with forum residents through the site.
- A court may consider non-Internet contacts together with website activity when evaluating whether the defendant purposefully directed conduct toward the forum.
- Jurisdictional discovery should be permitted when the plaintiff alleges facts with reasonable particularity suggesting the possible existence of the contacts required for jurisdiction; denying discovery despite such a threshold showing is an abuse of discretion.

## Conclusion

The Third Circuit held that allegations of an interactive commercial website combined with identified U.S.-related business activities were enough to justify limited jurisdictional discovery before dismissing for lack of personal jurisdiction, and it remanded for discovery and renewed jurisdiction analysis.


Toys “R” Us, Inc. v. Step Two, S.A., 318 F.3d 446 (3d Cir. 2003)