Opinion
21-CV-10831 (PGG) (JW)
02-07-2023
TOMAS MAYOR, Plaintiff, v. MAHAMADOU S. SANKAREH and ATLANTIC COOLING TECHNOLOGIES & SERVICES, LLC, Defendants. ATLANTIC COOLING TECHNOLOGIES & SERVICES, LLC, Cross Claimant, v. MAHAMADOU S. SANKAREH, Cross Defendant.
JENNIFER E. WILLIS, UNITED STATES MAGISTRATE JUDGE
REPORT & RECOMMENDATION
TO THE HONORABLE PAUL G. GARDEPHE, DISTRICT JUDGE:
This action was originally brought in the Supreme Court of the State of New York, County of Bronx. Following the commencement of the action, Defendant Atlantic Cooling Technologies & Services, LLC (“Defendant”)removed the case to the Southern District of New York. Dkt. No. 1. This motion to dismiss for lack of personal jurisdiction follows. Dkt. No. 19. It is my recommendation that the motion be GRANTED.
Individual Defendant Mahamadou S. Sankareh has not appeared in the federal action. “Defendant” refers only to Atlantic Cooling Technologies & Services, LLC, which made the subject motion.
BACKGROUND
On May 31, 2021, Plaintiff was in a car accident on eastbound route 495 in the state of New Jersey. Complaint ¶¶ 16-17, dated Sept. 24, 2021 (Dkt. No. 1 Ex. 1) (“Compl.”). Plaintiff alleges that the accident was with a motor vehicle owned by Defendant, which was at that time operated by Mahamadou Sankareh. Id. at ¶ 18. Plaintiff suffered injuries as a result of the collision and required medical aid, leading him to incur certain expenses. Id. at ¶¶ 21-22. Plaintiff also alleges that those injuries impacted his employment. Id. at ¶¶ 23-24. Plaintiff brought this action against Defendant and Mr. Sankareh for negligence and negligent entrustment causing his severe injuries and damage. Id. at ¶ 34.
The Summons and Complaint was served on Defendant on November 18, 2021. Notice of Removal of Civil Action to Federal Court by Defendants Under 28 U.S.C. §§ 1332, 1441, and 1446 at ¶ 4, dated November 18, 2021 (Dkt. No. 1) (“Notice of Removal”). On December 17, 2021, Defendant filed their notice of removal. Id. In that motion, Defendant articulated the basis for federal court jurisdiction over this action; namely, that there is complete diversity among the parties and the amount in controversy exceeds $75,000. Id. at ¶ 8. Diversity of citizenship was alleged as follows: Plaintiff as a resident of Florida; Defendant as a New Jersey corporation with its principal place of business located in New Jersey; and Mr. Sankareh as a resident of New Jersey. Id. at ¶¶ 9-11.
On January 6, 2022, Defendant filed their Answer to the Complaint. Dkt. No. 5. Defendant raised seventeen affirmative defenses in that pleading, the fifteenth of which was that “The Court lacks personal jurisdiction over Defendant” and therefore “Plaintiff's Complaint should be dismissed for lack of personal jurisdiction.” Id. at 7. On April 7, 2022 an initial pretrial conference was held before District Judge Paul G. Gardephe. Following that conference, Judge Gardephe ordered the Parties to submit a letter stating their positions on “the issues of diversity jurisdiction, personal jurisdiction, and venue in this case.” Order at 1, dated April 7, 2022 (Dkt. No. 9).
On April 21, 2022, the parties filed the letter addressing those issues. Plaintiff agreed that Defendant's principal place of business was in New Jersey, but also noted that Defendant was registered with the New York Department of State and was authorized to do business in New York, had an address at which to receive service of process in New York, and advertised as doing business in New York City. Letter at 1, dated April 21, 2022 (Dkt. No. 12). Defendant disagreed, arguing that there was not personal jurisdiction over Defendant in New York as the accident occurred in New Jersey. Id. at 1-2. Affidavits were filed by both parties supporting these assertions. Affidavit of Defendant Atlantic Cooling Technologies & Services, LLC, dated April 20, 2022 (Dkt. No. 13); Affidavit of Tomas Mayor, dated April 19, 2022 (Dkt. No. 14). Judge Gardephe subsequently ordered Plaintiff to rebut Defendant's contentions regarding personal jurisdiction with case law. Memo Endorsement, dated April 27, 2022 (Dkt. No. 17). Said letter was filed on May 2, 2022. Dkt. No. 16. On May 6, 2022, Judge Gardephe set the briefing schedule for Defendant's motion to dismiss for lack of personal jurisdiction. Dkt. No. 17. On May 26, 2022, Defendant filed their Motion to Dismiss, Dkt. No. 19, along with a Memorandum of Law in Support of the Motion to Dismiss, Dkt. No. 20 (“Memo.”), and an Affidavit from Cheryl Kerin in Support of the Motion to Dismiss. Dkt. No. 21 (“Kerin. Aff.”). On June 6, 2022, Plaintiff filed their Opposition brief as well as supporting documents. Dkt. No. 23 (“Opp.”). On June 10, 2022, Defendant filed their Reply. Dkt. No. 24 (“Reply”).
LEGAL STANDARD
Defendant moves to dismiss under Federal Rule of Civil Procedure (“FRCP”) 12(b)(2), asserting that this Court lacks personal jurisdiction over them. Memo. at 1. When served with a Rule 12(b)(2) motion to dismiss, it is the plaintiff's burden to demonstrate to the court that jurisdiction exists over the defendant. Whitaker v. Am. Telecasting, Inc., 261 F.3d 196, 208 (2d Cir. 2001). A plaintiff may meet this burden “by pleading in good faith... legally sufficient allegations of jurisdiction, i.e., by making a prima facie showing of jurisdiction.” Id. (quoting Jazini v. Nissan Motor Co., Ltd., 148 F.3d 181, 184 (2d Cir. 1998)). The plaintiff may support this through “his own affidavits and supporting materials containing an averment of facts that, if credited. would suffice to establish jurisdiction over the defendant.” Id. (citations and quotations omitted). Likewise, when ruling on 12(b)(6) motions courts may rely on materials outside of the pleadings. See Minnie Rose LLC v. Yu, 169 F.Supp.3d 504, 510 (S.D.N.Y. 2016). “[A]ll allegations re construed in the light most favorable to the plaintiff and doubts are resolved in the plaintiff's favor, notwithstanding a controverting presentation by the moving party.” A.I. Trade Fin., Inc. v. Petra Bank, 989 F.2d 76, 79-80 (2d Cir. 1993).
Assessing whether personal jurisdiction is proper is a two-step process. “[T]he court must look first to the [law] of the forum state, in this instance New York.” Bensusan Rest. Corp. v. King, 126 F.3d 25, 27 (2d Cir. 1997). Second, “[i]f the exercise of jurisdiction is appropriate ... the court must decide whether such exercise comports with the requisites of due process.” Id. New York exercises general jurisdiction over a party if “it has engaged in such a continuous and systematic course of doing business [in New York] that a finding of its presence [in New York] is warranted.” Sonera Holding B.V. v. Cukurova Holding A.S., 750 F.3d 221, 224 (2d Cir. 2014) (citing Landoil Resources Corp. v. Alexander & Alexander Servs., Inc., 77 N.Y.2d 28, 33 (1990)). “[A] court exercises general jurisdiction over a corporation consistent with due process only where the corporation's contacts with the forum are so ‘continuous and systematic,' as compared with the corporations other national and international activities, that it is ‘essentially at home' in the forum state.” Vera v. Republic of Cuba, 91 F.Supp.3d 561, 567 (S.D.N.Y. 2015) (quoting Daimler AG v. Bauman, 571 U.S. 117, 138-39 (2014)), rev'd on other grounds by Vera v. Republic of Cuba, 867 F.3d 310 (2d Cir. 2017).
As for the exercise of specific jurisdiction, New York's long-arm statute is codified in New York Civil Practice Law and Rules (“CPLR”) § 302 which governs “personal jurisdiction by acts of non-domiciliaries.” Specifically at issue in this matter is § 302(a)(1) which states that “a court may exercise personal jurisdiction over any non-domiciliary. who in person or through an agent transacts any business within the state or contracts anywhere to supply goods or services in the state.” The other three subsections are not applicable to the facts in this case, and thus do not warrant discussion.
DISCUSSION
Defendant's argument that this Court lacks jurisdiction over them is two-fold. First, Defendant argues that there is no general personal jurisdiction over them because they are incorporated in, and have their principal place of business, in New Jersey. Memo. at 5. Second, there is no specific personal jurisdiction over Defendant because the cause of action does not arise from any activity by Defendant in the state of New York. Id. at 6-8.
Plaintiff offers several arguments for why personal jurisdiction may exist over Defendant, two of which warrant discussion. The first of those is that Defendant is registered with the New York Department of State and has a service of process address in New York. Opp. at ¶ 35. Along with that, Plaintiff points out that Defendant advertises its business in New York. Id. at ¶ 29. Second, Plaintiff argues that because personal jurisdiction would exist over Mr. Sankareh, as Plaintiff alleges he is a resident of New York, that jurisdiction extends to make jurisdiction here proper over Defendant as well. Id. at ¶ 4 (citing CPLR § 503 which states that “the place of trial shall be in the county in which one of the parties resided when it was commenced”).
As the burden to demonstrate the existence of personal jurisdiction lies with Plaintiff, the Court will first look at their argument for general personal jurisdiction over Defendant, and then consider specific personal jurisdiction for completeness.
A. Whether Defendant's commercial activities in New York are sufficient to sustain general personal jurisdiction.
The facts that are relevant to this part of the inquiry are not in dispute. On the one side, Defendant is incorporated in New Jersey and maintains its principal place of business in New Jersey. Kerin Aff. at ¶¶ 4-5. On the other side, Defendant advertises their business as serving the New York Metropolitan Area, stating that their facility is located in New Jersey specifically so it can easily access “NYC and anywhere in the tri-state area with a moments notice.” Opp. at ¶ 29 (quoting https://www.atlanticcooling.com/). Furthermore, as part of the legal requirements for doing business in New York, Defendant has registered with the New York Department of State and authorized the New York Secretary of State as their agent for receiving service of process.
As recently as 2021, the New York Court of Appeals weighed in on the question of whether registering with the New York Secretary of State in accordance with the Business Corporation Law constitutes consent to general personal jurisdiction in New York. Aybar v. Aybar, 37 N.Y.3d 274, 280 (2021). The Court of Appeals wrote that, though the statute requires a foreign corporation to “register and designate an instate agent for service of process,” the statute does not “condition the right to do business on consent to the general jurisdiction of New York courts or otherwise afford general jurisdiction to New York courts over foreign corporations that comply with these conditions.” Id., 37 N.Y.3d at 283; see also Bustamante v. Atrium Med. Corp., No. 18-cv-8395 (ALC), 2020 WL 583745, at *3 (S.D.N.Y. Feb. 6, 2020) (looking to New York state law and finding the same).
The fact that Defendant does substantial business in New York and targets its business activities at the New York Metropolitan Area also does not suffice to support the exercise of general jurisdiction over them. “[G]eneral jurisdiction typically only lies in a corporation's place of incorporation and principal place of business.” Seabrooks v. Brown, No. 18-cv-10155 (PAC), 2019 WL 5450445, at *3 (S.D.N.Y. Oct. 24, 2019) (citing Daimler, 571 U.S., at 121). Engaging in business practices in New York state does not render a corporation at home here. See Id. (finding that a corporation with its headquarters in New Jersey that operated truck service centers in New York was not at home for purposes of general jurisdiction); Guccione v. Harrah's Mktg. Servs. Corp., No. 06-cv-4361 (PKL), 2009 WL 2337995, at *3 (S.D.N.Y. July 29, 2009) (Even though defendant advertised in New York and contracted for New York citizens to visit their casino, that still was not enough to serve as a basis for general jurisdiction.); Kaufhold v. Cyclopian Music, Inc., No. 10-cv-4588 (DLC), 2010 WL 5094630, at *3 (S.D.N.Y. Dec. 14, 2010) (Even assuming defendant solicited business in New York, that did not constitute a sufficient basis for general personal jurisdiction.); 7 W. 57th St. Realty Co., LLC v. Citigroup, Inc., Case No. 13-cv-981 (PGG), 2015 WL 1514539, at *10 (S.D.N.Y. Mar. 31, 2015) (“Plaintiff must demonstrate that [defendant's] suit-related conduct creates minimum contacts with New York, however, not simply that [defendant has] a presence here or conduct[s] business activities here in general.” (emphasis in original)). Thus, the Court does not have general jurisdiction over Defendant.
B. Whether specific jurisdiction exists over Defendant in this matter.
As stated above, CPLR § 302(a)(1) is the provision of New York's long-arm jurisdiction statute which applies in this case. “Long arm jurisdiction [under CPLR § 302(a)(1)] over a nondomiciliary exists where (i) a defendant transacted business within the state and (ii) the cause of action arose from that transaction of business.” Johnson v. Ward, 4 N.Y.3d 516, 519 (2005).
As for the first prong of this analysis, Plaintiff's Opposition adequately shows that Defendant does transact business within New York; in fact, Defendant's website appears to target New York for its services. See Paterno v. Laser Spine Inst., 24 N.Y.3d 370, 377 (2014) (stating that “where the non-domiciliary seeks out and initiates contact with New York, solicits business in New York, and establishes a continuing relationship, a non-domiciliary can be said to transact business within the meaning of CPLR 302(a)(1)”).
However, the second prong does not appear to be satisfied. The New York Court of Appeals has held that “a substantial relationship must be established between a defendant's transactions in New York and a plaintiff's cause of action in order to satisfy the nexus requirement of the statute.” Johnson, 4 N.Y.3d at 519 (quotation omitted). Here, as in Johnson, the cause of action arises out of a motor vehicle accident that occurred in New Jersey. Plaintiff does not make any allegations that the accident was in any way connected with business that Defendant transacted in New York. In the absence of any such assertions, the Court will not sua sponte infer a connection, particularly as there is no obvious link between Defendant's business and the driving of a vehicle in New Jersey. As such, the relationship between the claim and Defendant's general business is too attenuated. The Court does not have specific jurisdiction over Defendant in this matter.
C. Whether CPLR § 503 confers personal jurisdiction over Defendant.
For Plaintiff's second argument, that because personal jurisdiction allegedly exists over Mr. Sankareh it therefore extends to Defendant as well, he cites to CPLR § 503. CPLR § 503 states that “the place of trial shall be in the county in which one of the parties resided when it was commenced”. This provision governs the proper venue for an action; while Plaintiff is correct that that provision establishes New York as the proper venue for an action against Mr. Sankareh if he resides in New York, it does not confer personal jurisdiction over Defendant in this matter. See, e.g., Stravropoulos v. Asano, No. 2001-627 Q C, 2002 WL 655261, at *1 (N.Y.App.Div. Jan. 30, 2002) (“”[T]he court below erroneously applied CPLR 503, a venue provision, to the instant personal jurisdiction matter.”). Furthermore, the federal venue provision states that venue is proper in “any judicial district in which any defendant is subject to the court's personal jurisdiction.” 28 U.S.C. § 1391(b)(3). Thus, while personal jurisdiction may give rise to proper venue, the reverse is not indicated by the statute.
RECOMMENDATION
I recommend that the 12(b)(2) motion to dismiss be GRAN personal jurisdiction over Defendant Atlantic Cooling Technologies
FILING OF OBJECTIONS TO THIS REPORT AND RECOM
Pursuant to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Fede Procedure, the parties shall have fourteen days from service of t written objections. See also Fed.R.Civ.P. 6. Such objections, and objections shall be filed with the Clerk of Court and on ECF. An extension of time for filing objections must be directed to Judge Ga to file objections within fourteen days will result in a waive and will preclude appellate review. See Thomas v. Arn, 474 Cephas v. Nash, 328 F.3d 98, 107 (2d Cir. 2003).
SO ORDERED