A Pennsylvania trial court lacked personal general jurisdiction over a Delaware corporation headquartered in Connecticut when a New Jersey plaintiff failed to show that the company purposefully distributed its products in Pennsylvania, a Philadelphia judge has ruled.
Philadelphia Court of Common Pleas Judge Arnold L. New granted the preliminary objections raised by defendant Conair to jurisdiction in Pennsylvania over plaintiff Sandra J. Derringer’s claim that her finger was severely lacerated by a Conair product, a clogged “Smart Stick” blending device.
New’s opinion has added significance as he has taken on a larger role in the Philadelphia Court of Common Pleas’ civil system as both the supervising judge of the trial division’s civil section and the coordinating judge of the Complex Litigation Center, which has both mass tort cases and appeals from arbitration. The case is now on appeal to the state Superior Court.
There is not specific personal jurisdiction because the underlying incident occurred in New Jersey, New said.
And there is not general personal jurisdiction because there was not enough evidence of continuous and systemic contacts between Conair’s business activities and Pennsylvania, New said.
While Derringer introduced a copy of Conair’s website listing Pennsylvania retail stores selling its products, “plaintiff failed to show defendant purposefully distributed its products in Pennsylvania … where defendant’s products are available for purchase, the record lacks evidence to demonstrate defendant purposefully distributed its products into the ‘stream of commerce’ with the intent its products be available for purchase in this forum,” New reasoned.
New said there was a paucity of evidence of contractual or other relationships between Conair and third-party retailers in Pennsylvania; evidence of direct distribution of Conair’s products to Pennsylvania retail stores; evidence of what volume of products Conair shipped to Pennsylvania retailers; or evidence of the percentage of income Conair derived from third-party sales in Pennsylvania.
There is no statutory framework guiding Pennsylvania judges in determining if a non-resident corporation’s activities are so continuous and systematic in Pennsylvania that the judicial branch can exercise personal general jurisdiction over them, so determining this sort of jurisdiction depends upon case law, New said.
New cited mostly cases from the U.S. Supreme Court, including the 2011 decision in Goodyear Dunlop Tires Operations v. Brown. New also referenced the 2012 state Superior Court’s decision in Mendel v. Williams, which determined that Pennsylvania statutory law governing general jurisdiction over non-residents only requires “‘the minimum business activity necessary to establish general jurisdiction under the due process clause,’” New said.
The Goodyear decision led to the rejection of the theory that courts could have general jurisdiction over non-resident corporations just because those corporations put their products into the stream of commerce; the case instead established a new test, New said. The higher court stated in Goodyear that non-resident corporations are subject to general personal jurisdiction in situations in which the corporations, because their association with the state is so continuous and systematic, “‘as to render them essentially at home’” in the state.
Derringer argued that Pennsylvania had jurisdiction over Conair because Conair placed its products in the stream of commerce with the intention that its products reach both sellers and consumers in Pennsylvania, New said.
Derringer also argued that Conair availed itself of the business opportunities in Pennsylvania, including by advertising, shipping products into the state and receiving money from people and businesses who order products and parts, New said.
Conair argued that Pennsylvania’s exercise of jurisdiction over it would violate the due process clause of the federal Constitution, New said, because Derringer failed to establish Conair’s minimum contacts with the forum and that Conair could reasonably anticipate being haled into the Philadelphia Court of Common Pleas.
Conair is not registered to do business in Pennsylvania, does not own or lease any real estate in Pennsylvania and has no employees in Pennsylvania, New said.
Conair also does not have any real or personal property, bank accounts or registered agents in Pennsylvania, New said.
The judge distinguished the case from one state appellate court case cited by the plaintiff, the Superior Court’s 1973 decision in McCrory v. Girard Rubber. That appellate panel “noted the defendant’s activities in the forum would otherwise make it amenable to suit where the non-resident corporation admitted it took orders directly from Pennsylvania customers by telephone and through the mail, and the defendant made deliveries of those sales into Pennsylvania at its own expense.”
McCrory has not been cited since 1981, and the Superior Court decision was issued before Goodyear rejected the stream of commerce theory as a basis for general jurisdiction over a foreign defendant, New said.
Derringer filed claims for negligence, strict liability and breach of warranty for damages under $50,000, according to the opinion.
There is a parallel case in New Jersey between Derringer and Conair, which is at the summary judgment stage, according to the docket.
Derringer’s counsel, Thomas F. Reilly of Swartz Campbell, did not respond to a request for an interview. Conair’s counsel, Stephen J. Alexander of Capehart Scatchard, declined comment, citing the ongoing proceedings.
(Copies of the 14-page opinion in Derringer v. Conair, PICS No. 13-0052, are available from The Legal Intelligencer. Please call the Pennsylvania Instant Case Service at 800-276-PICS to order or for information.) •