Opinion
02-CV-0932E(Sc)
October 29, 2003
MEMORANDUM and ORDER
This decision may be cited in whole or in any part.
Danielewicz commenced this products liability action in New York State Supreme Court, County of Niagara, on September 9, 2002 against CLAAS KGaA mbH ("KGaA"), CLAAS Saulgau GmbH ("Saulgau") and CLAAS Selbstfahrende Erntemaschinen GmbH ("CSE"). Defendants removed the case to this Court on December 23, 2002. On May 8, 2003 defendants filed a motion to dismiss for lack of personal jurisdiction pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure ("FRCvP"). For the reasons set forth below, defendants' motion will be denied without prejudice.
Defendants are foreign corporations with their principal places of business in Germany.
Defendants contend, inter alia, that (1) they have conducted no activities that would subject them to jurisdiction under CPLR § 302, (2) Danielewicz cannot establish that defendants should have expected that their acts would have consequences in New York State and (3) neither Saulgau nor KGaA played any role in the design, manufacture or assembly of the Forage Harvester.
Danielewicz, a dairy farmer, was injured while greasing the chopping blade of a 381 Horsepower Self Propelled Forage Harvester Machine ("Forage Harvester"). The Forage Harvester was manufactured in Germany by Claas OHG and sold to Claas of America, LLC ("Claas of America") — the exclusive distributor of such machines in the United States. Danielewicz alleges that the defendants negligently and/or defectively manufactured and designed the Forage Harvester.
Claas OHG underwent a restructuring after the sale of the Forage Harvester at issue. Defendants claim that CSE was assigned responsibility for the sales of Forage Harvesters to Claas of America, LLC in the United States. KGaA is a holding company that owns the shares of CSE. Saulgau designs and manufacturers attachments and accessories that can be used with the Forage Harvester.
Plaintiff has commenced a separate action against Claas of America, LLC that is currently pending in state court.
When responding to a motion to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of establishing such. DiStefano v. Carozzi North America, Inc., 286 F.3d 81, 84 (2d Cir. 2001). Whether a federal court has personal jurisdiction over a given defendant in a diversity case is determined according to the law of the forum state. Id. Under New York law, this Court's two-step inquiry involves consideration of the relevant State long-arm provisions — section 302 of New York's Civil Practice Law and Rules ("CPLR") is relevant here — and federal due process requirements. Where, as here, personal jurisdiction is challenged before discovery or an evidentiary hearing, the plaintiff may overcome the challenge by making a prima facie showing of personal jurisdiction over the defendant. DiStefano, at 84. The Court considers the pleadings and affidavits in the light most favorable to the plaintiff. Id.
Bank Brussels Lambert v. Fiddler Gonzalez Rodriguez, 171 F.3d 779, 784 (2d Cir. 1999).
See also Jazini v. Nissan Motor Co., 148 F.3d 181, 184 (2d Cir. 1998) ("[P]rior to discovery, a plaintiff challenged by a jurisdiction testing motion may defeat the motion by pleading in good faith *** legally sufficient allegations of jurisdiction, i.e., by making a prima facie showing of jurisdiction.") (internal quotations omitted).
This Court has conducted no evidentiary hearing and no discovery has been conducted in this case. This Court will deny defendants' motion without prejudice and permit plaintiff to seek discovery. Indeed, even if this Court were inclined to grant defendants' motion, it would nonetheless give plaintiff leave to amend. Consequently, it is preferable to defer the personal jurisdiction determination until after discovery on this issue has been completed — at which point defendants may renew their motion. Inasmuch as Claas of America was the exclusive distributor of the Forage Harvester for CSE, information pertaining to the contract would be relevant in ascertaining whether personal jurisdiction exists over the defendants. Accordingly, defendants' motion will be denied without prejudice.
Although discovery has ostensibly been obtained in the related state court action against Claas of America, this Court will not deem such as transforming this action into a "post-discovery" motion to dismiss — especially inasmuch as the defendants are not parties to the state court action.
After discovery on personal jurisdiction is completed, plaintiff may seek to file an amended pleading that conforms his allegations to any discovered evidence.
See, e.g., Traver v. Officine Meccaniche Toschi SPA, 233 F. Supp.2d 404, 412-414 (N.D.N.Y. 2002) (denying foreign manufacturer's FRCvP 12(b)(2) motion without prejudice because the court was "unable to state with certainty that Defendant could have or should have expected its acts to have consequences in New York" within the meaning of CPLR 302(a)(3)(ii)); compare id. at 413 (noting that the "substantial revenue from interstate of international commerce" requirement of CPLR 302(a)(3)(ii) does not require that the revenue come from New York) with Defs.' Mem. of Law, at 5 ("[N]one of the Claas Defendants generate substantial revenue from the sale of Forage Harvesters in the State of New York.").
Kernan v. Kurz-Hastings, Inc., 175 F.3d 236, 241-242 (2d Cir. 1999) (holding that personal jurisdiction existed over foreign manufacturer sued by distributor pursuant to an exclusive distribution contract); Hein v. Cuprum, S.A., 136 F. Supp.2d 63, 68-69 (N.D.N.Y. 2001) (holding that, in personal injury action, personal jurisdiction existed over foreign manufacturer based on the terms of a Purchasing Agreement between the manufacturer and the distributor); Adams v. Bodum, Inc., 208 A.D.2d 450, 451 (1st Dep't 1994) (holding that, in personal injury action, personal jurisdiction existed over manufacturer under CPLR 302(a)(3)(ii) because exclusive distributorship agreement "provided ample basis for [trial court's] finding that [manufacturer] should have reasonably expected that persons in New York would be purchasing and using its coffee maker"); Thompson v. Nishimoto Trading Co., 689 N.Y.S.2d 858, 861 (N.Y.Sup.Ct. 1999) (holding that, in personal injury action, personal jurisdiction existed over Japanese manufacturer because it had entered into an exclusive distribution agreement covering the United States). There is sufficient question as to the nature of the relationships among the defendants and whether the facts are such that personal jurisdiction exists and, if so, over whom. Moreover, despite defendants' attempt to distinguish Kernan, such stands for the proposition that entering into an exclusive distribution contract is at least indirect evidence of an attempt to serve the New York market. Compare Kernan, at 242 (holding that exclusive distributorship agreement between Japanese manufacturer and Pennsylvania distributor for distribution of manufacturer's products in, inter alia, United States, satisfied CPLR "302(a)(3)(ii)'s reasonable expectation requirement" because it demonstrated "attempt to serve the New York market") with Defs.' Reply Mem., at 3-4 (suggesting that personal jurisdiction existed in Kernan "based on [the manufacturer-distributor] relationship].").
Accordingly, it is hereby ORDERED that defendants' motion to dismiss is denied without prejudice and that plaintiff may for now only seek discovery relevant to the issue of personal jurisdiction.