Opinion
CIVIL ACTION NO. 01-CV-4345
November 13, 2003
MEMORANDUM AND ORDER
Presently before the Court are Defendant HAZET-Werk's Motion for Summary Judgment (Doc. No. 24), and HAZET-Werk's Motion to Dismiss Plaintiffs' Complaint for Lack of Personal Jurisdiction Under Fed.R.Civ.P. 12(b)(2) (Doc. No. 25). For the following reasons, HAZET-Werk's Motion to Dismiss will be granted and HAZET-Werk's Motion for Summary Judgment will be denied as moot.
Background
Plaintiff Angelo Affatato ("Affatato") was employed as a mechanic/technician for RS Imports ("RS"). (Compl. ¶ 10.) Affatato alleges that on or about October 22, 1999, while in the course and scope of his employment at RS, he was attempting to remove the suspension spring on the front passenger side of a 1997 Mercedes Benz E 420 Wagon. While placing the spring compressor and clamps onto the spring to compress and remove the spring, the spring compressor and clamps suddenly and without warning popped off of the spring striking Affatato in the head and causing him to suffer serious injuries. (Id.) Plaintiffs filed this complaint against Defendants, HAZET-Werk ("HAZET"), the manufacturer of the spring compressor, and Mercedes Benz USA ("MB USA"), the distributor of the spring compressor, asserting claims for negligence, strict liability, and breach of express and implied warranties. Affatato's wife, Filomena Affatato, asserts a claim for loss of consortium.
Plaintiff also named Daimler Chrysler AG as a defendant but voluntarily dismissed Daimler Chrysler AG pursuant to Federal Rule of Civil Procedure 41(a).
I. HAZET's Motion To Dismiss
A. Applicable Legal Standard
HAZET moves to dismiss the complaint for lack of personal jurisdiction. A motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(2) "`requires resolution of factual issues outside the pleadings, i.e., whether in personam jurisdiction actually lies.'" Snider v. Howards. Slatkln, Inc., 105 F. Supp.2d428, 430 (E.D. Pa. 2000) (quoting Time Share Vacation Club v. Atlantic Resorts, Ltd., 735 F.2d 61, 66 (3d Cir. 1984)). When the defense of lack of personal jurisdiction is raised, the plaintiff may not simply rely on the pleadings to survive a motion to dismiss. Id. Once the defense is raised, the plaintiff must prove by a preponderance of the evidence facts establishing jurisdiction. Culbreth v. Simone, 511 F. Supp. 906, 910 (E.D. Pa. 1981) (citing McNutt v. General Motors Acceptance Corp., 298 U.S. 178, 189 (1936)). However, in deciding a motion to dismiss, we must "accept the plaintiff's allegations as true," and "construe disputed facts in favor of the plaintiff." Toys "R " Us, Inc. v. Step Two, S.A., 318 F.3d 446, 457 (3d Cir. 2003) (citing Pinker v. Roche Holdings, Ltd., 292 F.3d 361, 368 (3d Cir. 2001)).
Rule 4(e) permits a district court to assert personal jurisdiction over a non-resident to the extent allowed under the law of the state where the court sits. Remick v. Manfredy, 238 F.3d 248, 255 (3dCir. 2001) (citing Pennzoil Prod. Co. v. Colelli Assocs., Inc., 149 F.3d 197, 200 (3d Cir. 1998)). Under Pennsylvania's long-arm statute, 42 PA. CONS. STAT. § 5322(b), Pennsylvania courts may "`exercise personal jurisdiction over nonresident defendants to the constitutional limits of the due process clause of the fourteenth amendment.'" Id. (quoting Mellon Bank (East) PSFS, Nat'lAss'n v. Farino, 960 F.2d 1217, 1221 (3d Cir. 1992)). When a plaintiff asserts specific personal jurisdiction over a defendant, as in this case, due process requires that the defendant have "minimum contacts with the forum necessary for the defendant to have `reasonably anticipate[d] being haled into court there.'" Pennzoil, 149 F.3d at 201 (quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980)). The required "minimum contacts must have a basis in `some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.'" Asahi Metal Indus. Co., Ltd. v. Superior Ct. of Cal, 480 U.S. 102, 109 (1987) (O'Connor, J., plurality opinion) (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985)). Assuming minimum contacts have been established, in an appropriate case the court may also inquire whether "the assertion of personal jurisdiction would comport with `fair play and substantial justice.'" Burger King, 471 U.S. at 476 (quoting International Shoe Co. v. Washington, 326 U.S. 310, 320 (1945)).
B. Discussion
HAZET is a German limited partnership with its principal place of business in Remscheid, Federal Republic of Germany. (Miiller Decl. ¶ 3.) HAZET manufactures standard and special tools for the industrial and automotive sectors at its production facilities in Germany. (Id. ¶ 4.) HAZET does not own any real property or other assets in Pennsylvania. (Id. ¶¶ 10, 12.) It has no employees in Pennsylvania. (Id. ¶ 16.) It does not directly advertise or solicit business or sell any products in Pennsylvania. (Id. ¶¶ 17-19.) It has no distributers for its products in Pennsylvania, and has never specially designed any product for the Pennsylvania market. (Id. ¶¶ 14, 28.)
Plaintiffs contend that HAZET has sufficient minimum contacts with Pennsylvania to support personal jurisdiction. Plaintiffs also contend that "traditional notions of fair play and substantial justice" support jurisdiction over HAZET. Plaintiffs' contentions are based on the fact that HAZET placed the spring compressor that is the subject of this action in the "stream of commerce" by selling it to Mercedes Benz Germany ("MB Germany") in Germany. MB Germany then distributed the device to MB USA. MB USA distributed the tool to RS, one of its authorized dealers in Pennsylvania, where the tool allegedly injured Affatato. According to Plaintiffs, this conduct establishes a regular and anticipated flow of the product into Pennsylvania, awareness that the final product is being marketed in Pennsylvania, and satisfies each of the three tests for personal jurisdiction announced by the Supreme Court in Asahi.
To assess Plaintiffs' claim of jurisdiction via the stream of commerce, we must first identify the three tests for jurisdiction announced by the Supreme Court in Asahi. Though the Supreme Court approved the "stream of commerce" theory of personal jurisdiction in Asahi, it failed to produce a majority opinion as to how the stream of commerce test is satisfied. Justice O'Connor, joined by three justices, concluded that the "placement of a product into the stream of commerce, without more, is not an act of the defendant purposefully directed toward the forum state," and thus not sufficient to subject the defendant to personal jurisdiction in that state. Asahi, 480 U.S. at 112. To subject oneself to jurisdiction in the forum, Justice O'Connor required "[a]dditional conduct of the defendant [that] may indicate an intent or purpose to serve the market in the forum State." Id. Justice Brennan, writing for another plurality of four, argued that the minimum contacts required by due process were satisfied so long as there is a "regular and anticipated flow of [the defendant's] products" into the forum and the defendant "is aware that the final product is being marketed in the forum," finding the additional conduct described by Justice O'Connor unnecessary. Id. at 117. Justice Stevens, the ninth vote, stated that whether or not a defendant's conduct satisfies the minimum contacts test "is affected by the volume, the value, and the hazardous character of the components [placed in the stream of commerce.]" Id. at 122.
Examples of such additional conduct include "designing the product for the market in the forum State, advertising in the forum State, establishing channels for providing regular advice to customers in the forum State, or marketing the product through a distributer who had agreed to serve as the sales agent in the forum State." Asahi, 480 U.S. at 112.
Since the Supreme Court's decision in Asahi, the Third Circuit has repeatedly declined to adopt any one of the three tests announced Asahi, preferring to analyze questions of jurisdiction via the stream of commerce under all three tests. See, e.g., Pennzoil, 149 F.3dat 207 n. 13; Renner v. Lanard Toys, Ltd., 33 F.3d 277, 283 (3d Cir. 1994) (declining to adopt any of the three Asahi tests and remanding case to district court so that plaintiff could conduct jurisdictional discovery). However, HAZET urges us to follow Portella v. Life-Time Truck Prod., Inc., wherein another court in this district adopted Justice O'Connor's stream-of-commerce test and applied it in dismissing a complaint for lack of personal jurisdiction. 127 F. Supp.2d 652, 659 (E.D. Pa. 2000). In Portella, a truck driver sued the truck manufacturer, Ford, for injuries he sustained when a ladder attached to the side of his truck broke. Ford brought a third-party complaint against the installer of the ladder, Manning Truck Modification, Inc. ("Manning"). Manning, which did all of its business in Kentucky and had no customers other than Ford, moved to dismiss the complaint for lack of personal jurisdiction. The court granted Manning's motion on the grounds that it lacked direct sales, business contacts, and customers (other than Ford) in Pennsylvania, as well as the "additional conduct" described by Justice O'Connor. Id. at 658. The court acknowledged, however, that the "facts of this case might lead to a different result under the much broader stream-of-commerce standards enunciated by Justice Brennan or Justice Stevens in Asahi Metal" Id. at 659.
We decline HAZET's invitation to exclusively adopt Justice O'Connor's stream of commerce test because to do so is not necessary for our decision. Rather, we find that jurisdiction over HAZET is foreclosed by the Third Circuit's opinion in Renner. In Renner, the plaintiff, David J. Renner, a Pennsylvania resident, was injured while using a toy manufactured by the defendant, Lanard Toys, Ltd., a company based in Hong Kong. Renner had purchased the toy at a store in Pennsylvania. The store bought the toy from a buying agent who had purchased it from Lanard in Hong Kong. Lanard moved to dismiss the complaint for lack of personal jurisdiction and submitted an affidavit showing that it was a Hong Kong-based company with no assets or employees in Pennsylvania. The affidavit also showed that Lanard had no exclusive distributors, and no way of knowing or controlling where its distributors marketed its products. Though the Third Circuit declined to adhere to any one of the three stream of commerce tests stated in Asahi, the court ruled that the record before it "did not show the type of `purposeful availment' by Lanard in Pennsylvania that would satisfy minimum contacts." Renner, 33 F.3d at 283. Instead of dismissing the complaint, however, the court remanded the case to the district court so that the plaintiff could conduct jurisdictional discovery.
In contrast to Renner, Plaintiffs in this case have had an opportunity to conduct jurisdictional discovery, but the record they have produced no more shows the minimum contacts required by due process than the record before the court in Renner. As in Renner, the record in this case shows that the HAZET is a foreign-based entity that has no employees or assets in the forum, and does not market or sell any products in the forum. Any HAZET products that end up in Pennsylvania arrive as a result of the actions of third-party distributors over which HAZET has no control. The unilateral activities of third-parties cannot constitute a basis for jurisdiction over HAZET. See Stranahan Gear Co., Inc. v. NL Indus., Inc., 800 F.2d 53, 59 (3d Cir. 1986) (citing Hanson v. Denckla, 357 U.S. 235, 253 (1958)). In sum, we find HAZET's contacts with Pennsylvania indistinguishable from those described as insufficient in Renner. We therefore conclude that we lack jurisdiction over HAZET.
In light of our decision to dismiss the complaint against HAZET for lack of personal jurisdiction, we have no need to discuss HAZET's motion for summary judgment, which we deny as moot.
An appropriate order follows.
ORDER
AND NOW, this 19th day of November, 2003, upon consideration of Defendant HAZET-Werk's Motion for Summary Judgment (Doc. No. 24) and HAZET-Werk's Motion to Dismiss Plaintiffs' Complaint for Lack of Personal Jurisdiction Under Fed.R.Civ.P. 12(b)(2) (Doc. No. 25), and all papers filed in support thereof and in opposition thereto, it is ORDERED as follows:
1. HAZET-Werk's Motion to Dismiss is GRANTED.
2. HAZET-Werk's Motion to for Summary Judgment is DENIED as MOOT.
IT IS SO ORDERED.