Opinion
01 Civ. 7487 (DAB)
March 15, 2004
MEMORANDUM ORDER
Third-Party Defendant Lunenburg Foundry Engineering Limited' s ("LIFE" or "Third-Party Defendant") has moved to dismiss the Third-Party Complaint for lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(2).
BACKGROUND
In August 2001, Plaintiff Kurt Schultz ("Plaintiff") filed this suit against Defendant Ocean Classroom Foundation, Inc. and Schooner Harvey Gamage Foundation, Inc. (collectively known as "Ocean" or "Third-Party Plaintiffs") to recover damages for personal injuries he allegedly sustained from a defective windlass while on board the sailing vessel HARVEY GAMAGE, owned and operated by Ocean, off the coast of Puerto Rico. At the time of the accident, Schultz alleges he was employed by Ocean. (Compl. at ¶¶ 7, 9; Third-Party Compl. at ¶¶ 7, 9.) Ocean is a New York corporation, and Schultz is a resident of the State of Texas. (Compl. at ¶ 5; Third-Party Compl. at ¶¶ 1, 2.)
A "windlass" is "any of numerous hauling or lifting machines consisting primarily of a drum or cylinder wound with rope and turned by a crank." Webster's II, New Riverside University Dictionary (1994).
Ocean commenced a third-party action in accordance with Rule 14(a) of the Federal Rules against Lunenburg Foundry Engineering Limited ("LIFE" or "Third-Party Defendant"), the alleged manufacturer of the windlass. The Third-Party Complaint was filed against LIFE, the alleged manufacturer of the windlass on the HARVEY GAMAGE. (Third-Party Compl. at ¶ 13.)
Federal Rule 14(a) states: "At any time after commencement of the action a defending party, as a third-party plaintiff, may cause a summons and complaint to be served upon a person not a party to the action who is or may be liable to the third-party plaintiff for all or part of the plaintiff's claim against the third-party plaintiff" and if the third-party complaint is not served within 10 days after the serving of the original answer, "[t]he third-party plaintiff must obtain leave on motion upon notice to all parties to the action." At the Rule 16 conference before the Court on February 15, 2002, the parties explained that third parties might have to be joined. The Court's February 15, 2002, Scheduling Order granted the parties leave to file a third-party Complaint if necessary.
LIFE, a limited liability company, has its principal and only place of business in Lunenberg, Canada in the province of Nova Scotia. (Kinley Decl. at ¶ 4; Kinley Depo. at 7-9.) LIFE operates a ship yard and a foundry in Lunenburg where it manufactures marine hardware and other equipment for the marine trade and repairs vessels. (Kinley Decl. at ¶ 5; Kinley Depo. at 13-16.) LIFE designs its marine hardware using Canadian standards and directs its products and services principally to the Canadian market, which accounts for over 90% of its business. (Kinley Decl. at ¶ 5; Kinley Depo. at 87.) LIFE is not organized under the laws of, is not registered to do business in, does not maintain any offices in, and does not have any employees, sales agents, or officers in the State of New York or any other state. (Kinley Decl. ¶ 6.) Moreover, the company does not maintain any bank accounts in New York, nor have a registered agent who can legally receive service of process in New York or any other state. (Id.)
Though the bulk of LIFE'S business originates in Canada, it does transact some business with American companies and individuals and does maintain some business relationships with American-based corporations. From January 1997 through August 2002, LIFE entered approximately twenty-two transactions involving shipments to New York destinations totaling $13,328 Canadian dollars in sales, amounting to 0.07% of all of LIFE'S sales for the same time period. (Kinley Depo. at 48.) As Peter Kinley, the Chief Executive Officer of LIFE, explained in his Deposition, the typical sale to an individual or company in New York state:
This is equivalent to approximately $9,998 U.S. dollars. The exchange rate on February 4, 2004 was 1.333 Canadian dollars to one U.S. dollar. See www.ny.frb.org/markets/fxrates/.
Well, the standard for any customer would be that they'd call us and tell us what they wanted and we'd make it and there'd be some issue about terms, how they'd pay for it. There'd be some issue about specific sizes of things, you know, getting the specification right, produce it, get the money, ship it to them or sometimes there'd be a partial payment even before the job was started and then the final payment. Generally, anything going out of the country we ask for payment up front.
(Id. at 49-50.)
All these transactions were carried out in Canadian dollars. (Kinley Decl. at ¶¶ 13-15.)
In addition to these transactions, on August 18, 1999, Andrew Moore, the sole owner and President of Navigator Stove Works ("Navigator"), (Navig. Depo. at 7-9), a corporation based in Brooklyn, New York, directly approached LIFE in Nova Scotia to negotiate a licensing agreement ("Agreement") to manufacture stoves whose design and manufacture LIFE once oversaw. (Navig. Depo. at 10-12; Kinley Depo. at 36-38). Navigator arranged in the Agreement to license seven plates of foundry stove patterns from LIFE, guaranteeing LIFE a 6% royalty on any stoves manufactured and sold from these plates. (Navig. Depo. at 8, 13, 21, 22). For example, for the years 2001-2002, LIFE'S royalties totaled approximately $1,600.00. (Kinley Decl. at 16).
In his deposition, Andrew Moore describes the meeting which produced the Agreement: "Yeah. I picked them up when I was up there [in Canada]. We signed the licensing agreement and put the patterns in the back of my pick-up and drove home." (Navig. Depo. at 8, 22). Moore also stated that he had never met with LIFE employees in New York. (Id. at 16.)
Navigator currently produces two types of stoves from these patterns. (Id. at 25). The Agreement also designates LIFE as a distributor of Navigator stoves for the Canadian provinces of Prince Edward Island, Nova Scotia and Newfoundland. (Id. at 38.) Navigator and LIFE also agreed, that when LIFE sells a stove, it would get a twenty-percent discount off retail. (Id. at 38, 56, 57). LIFE displays a Navigator stove at its place of business and calls Navigator two to four times annually requesting pamphlets about these stoves. (Id. at 38). To date, LIFE has not sold any Navigator stoves. (Id. at 38, 39). The Agreement does not prevent Navigator from doing business with other companies. (Id. at 21).
LIFE also advertises occasionally in general trade magazines that have a North American circulation, including New York, and sends representative to various trade shows, including some in the states. (Kinley Depo. at 57-58; Kinley Decl. ¶ 10.) None of the trade shows in the past several years has been in New York; Kinsley did recall attending one trade show in the Javits Center in New York City some many years ago. (Kinley Depo. at 29; Kinley Decl. ¶ 10.)
LIFE maintains a Website (the "Website"), accessible on the worldwide web, containing links to other websites relevant to the boating community. (Kinley Decl. at ¶¶ 7-9.) The Website is highly interactive and displays many of the companies products, including windlasses (Decl. Fromm, Exh. K.). The prices on the Website are quoted only in Canadian dollars; the Website makes no mention of New York. However, among the links contained on the LIFE Website is one to the Navigator's homepage, as negotiated in the Agreement. (Navig. Depo. at 44, 46-7.). Navigator maintains a reciprocal link, one of thirteen such links on its website. (Id. at 31, 48, 49, 61).
In its Answer, LIFE asserted that this Court lacked personal jurisdiction over it. (Third-Party Ans. at Aff. Defs. f 3.) At a subsequent Rule 16 Conference on November 22, 2002, the Court issued a Briefing Schedule for this Motion. Third-Party Defendant timely filed their Motion to Dismiss, to which Third-Party Plaintiffs have responded. LIFE filed a Reply.
DISCUSSION
I. Standards for Motion to Dismiss for Lack of Personal Jurisdiction in New York
It is well-established that "[i]n resolving questions of personal jurisdiction in a diversity action, a district court must conduct a two-part inquiry. First, it must determine whether the plaintiff has shown that the defendant is amenable to service of process under the forum state's laws; and second, it must assess whether the court's assertion of jurisdiction under these laws comports with the requirements of due process." Metropolitan Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 567 (2d Cir. 1996) (citation omitted); see also Fed.R.Civ.P. 17(b) ("The capacity of a corporation to sue or be sued . . . shall be determined by the law of the state in which the district court is held."); Asahi Metal Ind. Co. v. Superior Crt. of Calif. 480 U.S. 102 (1987) (holding that once personal jurisdiction is established, exercise of that jurisdiction must still qualify as fair and reasonable under the Due Process Clause of the Fourteenth Amendment).
Although the party asserting personal jurisdiction ultimately bears the burden of demonstrating such jurisdiction, where no evidentiary hearing has been held, it is sufficient for that party to simply make a prima facie showing of jurisdiction. See Jazini v. Nissan Motor Co., 148 F.3d 181, 184 (2d. Cir. 1998). As such, "the court must view all of the allegations in the light most favorable to plaintiffs and resolve all doubts in plaintiffs' favor." In re Ski Train Fire in Kaprun, Austria on Nov. 11, 2000, 230 F. Supp.2d 403, 406 (S.D.N.Y. 2002) (citing Hoffritz for Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55, 57 (2d Cir. 1985)).
However, w[a]fter discovery, the plaintiff's prima facie showing, necessary to defeat a jurisdiction testing motion, must include an averment of facts that, if credited by the trier, would suffice to establish jurisdiction over the defendant." Ball v. Metallurgie Hoboken-Overpelt, S.A., 902 F.2d 194, 197 (2d Cir. 1990). This averment can come in the form of a Rule 12(b)(2) motion, "which assumes the truth of the plaintiff's factual allegations for purposes of the motion and challenges their sufficiency." Id.
Here, Third-Party Plaintiffs premise jurisdiction under general and specific personal jurisdiction, respectively, §§ 301 and 302 of New York's Civil Practice Law Rules ("CPLR"). Since jurisdictional discovery has been conducted, the Court looks to the sufficiency of Third-Party Plaintiffs' factual allegations.
A. General Personal Jurisdiction under § 301
General personal jurisdiction may be asserted over corporations "doing business" in New York under CPLR § 301, which states in pertinent part, "[a] court may exercise such jurisdiction over persons, property or status as might have been exercised heretofore." As interpreted by courts, § 301 permits "a court to exercise jurisdiction over a foreign corporation on any cause of action if the defendant is engaged in such a continuous and systematic course of `doing business' here as to warrant a finding of its `presence' in this jurisdiction." Landoil Resources Corp. v. Alexander Alexander Servs., Inc., 918 F.2d 1039, 1043 (2d Cir. 1990) (internal quotations omitted) (citations omitted). "Doing business" requires that the defendant be present in New York "not occasionally or casually, but with a fair measure of permanence and continuity." Id. (citing Tauza v. Susquehanna Coal Corp., 220 N.Y. 259, 267 (1917)). This inquiry is a "simple and pragmatic" test, and courts have traditionally focused on a "traditional set of indicia," including the (1) existence of a company office in the state, (2) the presence of bank accounts or property in the state, (3) the maintaining of a phone listing in the state, (4) any public relations work done in the state, and (5) attempts by the company to promote its interests through agents or other individuals permanently located in the state. Wiwa v. Royal Dutch Petroleum Co., 226 F.3d 88, 98 (2d Cir. 2000) (citations omitted), cert. denied, 532 U.S. 941 (2001).
Courts have also asserted jurisdiction under § 301 over entities that "regularly solicit business [in New York] and engage in some additional commercial activity within the state," Thomas Publishing Company, 237 F. Supp.2d 489, 491 (S.D.N.Y. 2002). This is known as the "solicitation plus" doctrine. Kinsepp at 27 (citing Aquascutum of London, Inc. v. S.S. American Champion, 426 F.2d 204, 211 (2d Cir. 1970)). This doctrine requires that the case involve "either financial or commercial dealings in New York, either personally or through an agent,"Id. at 27 (citing Aquascutum, at 212)), and its key question "is whether the defendant (or its agent) behaved in such a way so as to encourage others to spend money (or otherwise act) in a manner that would benefit the defendant." Wiwa, 226 F.3d at 98. Finally, the solicitation must be substantial and done from a permanent location within the state for a party asserting jurisdiction to invoke this doctrine. See Pellegrino v. The Stratton Corp., 679 F. Supp. 1164, 1170 (N.D.N.Y. 1988)("Basically, New York courts have required `substantial solicitation' that is done with a `considerable measure of continuity and from a permanent locale' within the state.") (citing Beacon Enterprises, Inc. v. Menzies, 715 F.2d 757, 763 (2d Cir. 1983)).
B. "Doing Business" under CPLR § 301
Third-Party Defendant argues that § 301 does not confer jurisdiction over it here. The "simple and pragmatic" test is not satisfied because LIFE has no office, employees, bank accounts or property in New York. It is not licensed to do business in New York. LIFE further contends that it does not meet the requirements of the "solicitation plus" doctrine as its solicitation of business in New York is neither "substantial" nor transacted with a considerable measure of continuity and from a permanent locale in the state.
Third-Party Plaintiffs argue that when LIFE'S highly interactive Website, its advertisements in magazines circulated in New York, and its contractual obligations with Navigator arising from the Agreement are examined in toto, it is clear that LIFE actively does business in New York, sufficient for this Court to exercise jurisdiction over Third-Party Defendant.
Third-Party Plaintiffs also argue that under the "solicitation plus" doctrine, LIFE actively solicits business in New York by maintaining a website accessible in New York, advertising in publications that are distributed throughout the United States including New York, and attending trade shows in the United States. When such solicitation is coupled with LIFE'S sales to New York residents, its Agreement with Navigator, then § 301's requirements have been met.
It is indisputable that LIFE does not have any offices in New York State, nor does it maintain a telephone listing here.
It has no assets of any kind in the state in the form of real property or liquid assets, and it has no agents who are permanently (or even occasionally) in New York.
It has only one contractual relationship with a New York company, and the Agreement was signed in Canada at the sole initiative of Navigator, not LIFE. In the past few years, LIFE has sold $13,000 to New York addresses, constituting no more than 0.07% of its overall sales during that time period.
LIFE'S advertising does not specifically target New York. In his deposition, Kinley could not even state whether the several magazines in which LIFE advertises are circulated in New York (Kinley Depo. at 58-59); LIFE instead placed those advertisements to reach the Maritime Provinces market, in which it is located. LIFE has never sent agents to New York to buy advertising or to promote its business there through any public relations medium, nor it seems conducted any public relations work. Furthermore, advertisements in newspapers and radio will not satisfy the jurisdictional requirements of § 301. Muollo v. Crestwood Village, Inc., 547 N.Y.S.2d 87, 88 (N.Y. 2d Dept 1989) (finding no jurisdiction over a foreign company that advertised extensively in New York). Indeed, New York courts have long held that "absent a showing of an office or employees or agents in New York, the use of New York media for advertising defendant's foreign business . . . has been held insufficient to confer jurisdiction over the defendant in New York." Carbone v. Fort Erie Jockey Club, Ltd., 366 N.Y.S.2d 485, 487 (N.Y. 4th Dept 1975) (citing Frummer v. Hilton Hotels Int'l, 19 N.Y.2d 533 (1967); see also Cardone v. Jiminy Peak, Inc., 667 N.Y.S.2d 82, 83 (N.Y. 3d Dept 1997) (finding no jurisdiction over a Massachusetts ski resort which among other things placed advertisements on New York radio stations, television stations, and print media). Here, it is not even a. close question when occasional advertisements were placed in three journals, none of which are New York-specific publications.
The trade shows to which LIFE has sent representatives all took place in other states, save one that took place at the Javits Center years ago. It is a rather attenuated argument that LIFE has done business in New York by attending trade shows in other states where potential New York customers might be; this hardly amounts to systematic conduct in the forum state. Cf. Holness v. Maritime Overseas Corp., 676 N.Y.S.2d 540, 543 (1st Dept 1998) (no jurisdiction over a corporation who advertises in New York and even sends agents occasionally to the state) (citing McGowan v. Smith, 52 N.Y.2d 268, 272 (1981)).
Finally, Third-Party Plaintiff's substantial reliance on LIFE'S Website to establish their jurisdictional argument is misplaced. "[T]he fact that a foreign corporation has a website accessible in New York is insufficient to confer jurisdiction under CPLR § 301," In re Ski Train Fire in Kaprun, Austria on Nov. 11, 2000, 230 F. Supp.2d 376, 383 (S.D.N.Y. 2002) (quoting Spencer Trask Ventures v. Archos S.A., No. 01 Civ. 1169, 2002 WL 417192 at *6-*7 (S.D.N.Y. Mar. 18, 2002)), and is rather a question to determine under § 302. Even when viewed in connection with LIFE'S other activities and in the light most favorable to the nonmovant, the Website proves nothing. Indeed, the Website lists prices solely in Canadian dollars, makes no mention of New York, and has only one link to a New York corporation. In short, under § 301's traditional indicia, Third-Party Plaintiffs' factual allegations are insufficient.
Third-Party Plaintiffs claim that items can be directly purchased from the Website. (See, e.g., Fromm Decl., Exh. G at K29-33.) In his Deposition, Kinley noted that it was not possible to order products directly from the Website. (Kinley Depos. At 82-83.) Resolving this fact in Third-Party Plaintiffs' favor, however, does not alter the Court's determination.
In analyzing the facts here under the "solicitation plus" doctrine, the Court first notes that the doctrine requires that the defendant's solicitation activities be substantial enough to bring it within the doctrine. Dunn v. Southern Charters, Inc., 506 F. Supp. 564, 567 (E.D.N.Y. 1981). In Dunn, the court found it doubtful at best that a company deriving no more than 1.5% of its revenues could have jurisdiction exercised over it, citing cases in which 2% and 4% were also deemed insufficient. Id. (citing Stark Carpets v. M-Geough Robinson, Inc. 481 F. Supp. 499, 505 (S.D.N.Y. 1980); New England Laminates Co. v. Murphy, 362 N.Y.S.2d 730, 732-33 (Sup.Ct. 1974)). Here, LIFE derived only 0.07% of its revenues from New York. Furthermore, LIFE has no employees or agents permanently located in New York to promote and solicit business on its behalf, as the doctrine requires. The Court is therefore not persuaded that the factual averments demonstrate that the "solicitation doctrine" is even implicated here. Accordingly, the Court declines to analyze the case under the doctrine.
The Southern District cases relied upon by Third-Party Plaintiffs are inapposite. In three of the cases, the companies challenging jurisdiction employed agents in New York who were actively seeking to promote the companies interest, as the "solicitation doctrine" requires.See Thomas Publishing Company, 237 F. Supp.2d at 491 (finding "solicitation plus" test satisfied in part because an agent for the defendant "has visited New York on a series of occasions to further [defendant's] business interests"); Bicicletas Windsor, S.A. v. Bicycle Corp. of America, 783 F. Supp. 781, 784 (S.D.N.Y. 1992) (noting that the defendant had hired a "territorial manager" to represent the company in the New York metropolitan area and even placed an announcement in a trade magazine, trumpeting the hire); Student Advantage, Inc. v. Int'l Student Exchange Cards, Inc., 00 Civ. 1971 (ACS), 2000 WL 1290585 (S.D.N.Y. Sept. 13, 2000) (finding jurisdiction with company that had agents working in New York actively recruiting new clients and procuring contracts with over 170 New York merchants). There has been no allegation that LIFE has employees or agents permanently in New York.
The remaining two cases cited premise jurisdiction not under § 301 but § 302. See Starmedia Network, Inc. v. Star Media, Inc., 00 Civ. 4647 (DLC), 2001 WL 417118 (S.D.N.Y. 2001 Apr. 23, 2001) (finding jurisdiction under § 302 and never once mentioning § 301); National Football League v. Miller, 99 Civ. 11846 (JSM), 2000 WL 335566 (S.D.N.Y. Mar. 30, 2000) (same).
In sum, Third-Party Plaintiffs have failed to aver sufficient facts that § 301 confers jurisdiction over LIFE.
B. Specific Personal Jurisdiction
Under CPLR § 302(a)(3), specific jurisdiction may in certain circumstances be asserted over a foreign company by a New York federal court. Section 302 reads in pertinent part:
[A] court may exercise personal jurisdiction over any non-domiciliary, who . . .
3. commits a tortious act without the state causing injury to person or property within the state, except as to a cause of action for defamation of character arising from the act, if he
(i) regularly does or solicits business, or engages in any other persistent course of conduct, or derives substantial revenue from goods used or consumed or services rendered, in the state, or
(ii) expects or should reasonably expect the act to have consequences in the state and derives substantial revenue from interstate or international commerce; or
C.P.L.R. § 302(a).
"Courts determining whether there is injury in New York sufficient to warrant § 302(a)(3) jurisdiction must generally apply a situs-of-injury test, which asks them to locate the `original event which caused the injury.'" Bank Brussels Lambert v. Fiddler Gonzalez Rodriguez, 171 F.3d 779, 791 (2d Cir. 1999) (citations omitted). The original event is "generally distinguished not only from the initial tort but from the final economic injury and the felt consequences of the tort." Id., (citing Hermann v. Sharon Hosp., Inc., 522 N.Y.S.2d 581, 583 (2d Dept. 1987) (citing McGowan v. Smith, 52 N.Y.2d 268, 273-74 (1981)). Furthermore, an "injury does not occur within the state simply because the plaintiff is a resident."Mareno v. Rowe, 910 F.2d 1043, 1046 (2d Cir. 1990).
In certain situations, financial loss and damage in New York can constitute the "injury" necessary to establish jurisdiction under § 302. The Second Circuit has held that § 302 is satisfied if a tortious act results in an immediate, not subsequent, financial injury in New York.See Hargrave v. Oki Nursery, Inc., 636 F.2d 897 (2d Cir. 1980). Of paramount importance to this analysis is that "the exercise of personal jurisdiction must be based" on a "direct injury within the state" and a close "expectation of consequences within the state" stemming from the tortious act. Mareno, 910 F.2d at 1046.
Third-Party Defendant argues that the injury was suffered in Puerto Rico, not New York. LIFE further argues that the lawsuit filed in New York by Schultz is not the proper injury by which to determine jurisdiction under § 302 since the underlying tort occurred in Puerto Rico. "The possible economic loss to be suffered by Ocean in N.Y. if any, is simply a remote and consequential effect of the accident and injury in Puerto Rico."
(Def. Reply Memo, of Law at 14.)
Third-Party Plaintiffs argue that LIFE committed the tortious act of negligently designing and manufacturing a defective windlass and that this act caused the injury of a lawsuit brought in New York against Third-Party Plaintiffs. In Ocean's estimation, this lawsuit constitutes financial injury and establishes the site of injury as New York.
The nature of the injury is open to question. While for purposes of this Motion, Third-Party Defendant concedes their records indicate one of their windlasses was sold to the prior owners of the HARVEY GAMAGE, it is not clear whether the defect, if any, was in the windlass' manufacture, installation, or maintenance. However, assuming arguendo that the windlass was made by LIFE, was defective, and caused the injury to Plaintiff Schultz, it appears to the Court that the initial tort would have occurred in the manufacture of the windlass. The "original event" transpired on the HARVEY GAMAGE in Puerto Rico, which in turn, gave rise to the lawsuit in New York. Thus, the lawsuit, while certainly a financial injury that Third-Party Plaintiffs must bear, is not an immediate and direct result of the original event, but rather an indirect and consequential event.
Third-Party Plaintiffs erroneously rely on two Second Circuit and Southern District cases. National Westminster Bank PLC, v. Retirement Care Assocs., Inc., 98 Civ. 6023 (JSM), 1999 WL 239677 (S.D.N.Y. Apr. 23, 1999) and Hargrave do not require a finding of jurisdiction here. InNational Westminster Bank PLC, jurisdiction was established because the defendant knew that "its actions were directed at avoiding a financial obligation to a New York entity under a contract that was partially negotiated and executed in New York and should have expected that its actions would cause financial loss in New York." Id. at *8. In Hargrave, the plaintiff, a New York vineyard, brought suit against a California nursery, which supposedly misrepresented the health of certain vines it sold to plaintiff. The Second Circuit found that the injury "was immediately felt in New York where plaintiffs were domiciled and doing business, where they were located when they received the misrepresentations, and where the vines were to be shipped." Hargrave, 636 F.2d at 900. Here, there was no direct and immediate financial loss suffered by a New York entity from the original event. The lawsuit is a consequential injury, and Third-Party Defendant, unlike the defendants inHargrave and National Westminster Bank PLC could not have reasonably expected that its actions would cause injury in New York.
Southern District case law reinforces the Court's determination here. In Atlantic Mutual Ins. Co., Inc. v. CSX Expedition, 2002 WL 202195 (S.D.N.Y. Feb. 7, 2002), Atlantic Mutual, an insurance company, alleged that the defendants had negligently repaired a container ship, which later carried one of Atlantic Mutual's insured's cargo and damaged it when water leaked into the ship. Atlantic Mutual then had to pay a claim under its policy in New York and brought suit against the company that had repaired the ship. Judge McKenna ruled that the original event occurred at sea and not in New York and that the payment on the claim was a consequential "effect" of the injury under § 302 analysis. Id. at 4. § 302(a) did not extend jurisdiction over a foreign corporation because the injury was too remote and indirect. This is precisely the case at bar. An allegedly defective item results in an accident at sea whose ramifications include claims in New York. The Court agrees with Atlantic Mutual that the original event did not occur in New York, thus making § 302 inapplicable. As such, jurisdiction over LIFE under § 302 cannot lie.
CONCLUSION
Because jurisdiction is not applicable here under either CPLR §§ 301 or 302, this Court need not resolve whether the assertion of jurisdiction here would comport with federal due process requirements. Accordingly, the Court GRANTS Third-Party Defendant's Motion to Dismiss.
SO ORDERED.