in determining whether the corporation is doing business in that State, as the nature and extent of its selling activities within the jurisdiction; pointing out, as a general criterion of 'doing business' that
'Continuity of action from a permanent locale is essential. The foreign corporate defendant must be 'here, not occasionally or casually, but with a fair measure of permanence and continuity'.'
The same case also determined that representation of a foreign corporation in its local activities by a separate individual or by a separate corporation instead of by a directly controlled subsidiary or branch office is not determinative of the question whether the corporation is doing business within the State; but if a resident buyer is acting as agent of the foreign corporation, the absence of a local corporate office will not deprive the New York Courts of jurisdiction.
The weight of evidence submitted on this motion relevant to the question of whether Around-the-World does business in New York State, tested by the New York criteria above indicated, seems to compel the conclusion that Around-the-World was not doing business, and, therefore, was not found in, and hence this action could not have been brought against that corporation in the State of New York. Reduced to its simplest features, the activities of Around-the-World, insofar as they affected New York residents, consisted of the broadcasting by mail and through advertising media of invitations to enroll in membership in the 'club' by filling out a membership application and sending it with a certain monetary payment to the corporation at its office in New Jersey. Thereupon receipt of the application would be acknowledged by the corporation to the applicant by mail, and an order placed by the corporation with a shipper of merchandise in a foreign country directing the shipment of an article of merchandise directly to the enrolled member. Plaintiffs say that a contract resulted between a person in New York who responded to the corporation's offer of enrollment, when the applicant signed and mailed the application form accompanied by the required payment. Defendant contends, however, that no contract came into existence until the application for enrollment had been accepted by the corporation. In support of their contention in this regard plaintiffs rely on Packard Englewood Motors, Inc., v. Packard Motor Car Co., Inc., 3 Cir., 1954, 215 F.2d 503, and upon Wester v. Casein Co. of America, 206 N.Y. 506, 100 N.E. 488. Both of these decisions recognize the principle stated in Section 65 of the Restatement of the Law of Contracts that transmittal of an acceptance of an offer by the means directed in the offer results in the formation of a contract at the place of such acceptance unless at the place of such acceptance World contends that no contract resulted until it accepted the application for enrollment. Assuming, however, that the transmittal of the application for enrollment with the required fee by mail from New York to the offeror corporation created a contract, the consummation of the contract would not constitute the doing of business in New York. Schmidt v. Esquire, Inc., 7 Cir., 1954, 210 F.2d 908, certiorari denied sub nom. Schmidt v. Crowell-Collier Publishing Co., 348 U.S. 819, 75 S. Ct. 31, 99 L. Ed. 646; Cannon v. Time, Inc., 4 Cir., 1940, 115 F.2d 423. In Cannon it was pointed out, at page 425, that 'Mere solicitation of business by an agent does not constitute such a doing of business as to subject a foreign corporation to the local jurisdiction; and the situation is not changed by the fact that the agent may collect some money in connection with the business solicited.' To a similar effect are Green v. Chicago, B. & Q.R. Co., 205 U.S. 530, 27 S. Ct. 595, 51 L. Ed. 916, and Philadelphia & Reading R. Co. v. McKibbin, 243 U.S. 264, 37 S. Ct. 280, 61 L. Ed. 710.
The cases relied upon by plaintiffs are distinguishable from and do not control the immediate question. In Cannon, supra, Judge Parker, 115 F.2d at page 425, summarizes International Harvester Co. of America v. Commonwealth of Kentucky, 234 U.S. 579, 34 S. Ct. 944, 58 L. Ed. 479, as disclosing 'a continuous course of business of large volume within the state, evidenced by solicitation of orders, delivery of goods, acceptance of checks and drafts and the discounting of these within the state' which supported the conclusion that 'all of these things, taken together, amounted to the doing of business within the state.' The question posed in International Shoe, supra, (326 U.S. 310, 66 S. Ct. 156), was whether that (Delaware) corporation had 'by its activities in the State of Washington rendered itself amenable to proceedings in the courts of that state to recover unpaid contributions to the state unemployment compensation fund exacted by' the Washington State Statutes. The question was answered affirmatively because, although the foreign corporation had no office in the State of Washington and made 'no contracts either for sale or purchase of merchandise there * * *' and maintained 'no stock of merchandise in that state and makes there no deliveries of goods in intrastate commerce', it employed eleven to thirteen resident salesmen under direct supervision and control of sales managers in its home office in St. Louis, whose activities were confined to the State of Washington and whose compensation was in the form of commissions based upon the amount of their sales in that State. It also appeared that these salesmen were furnished by their employer with samples for display to prospective purchasers, and were reimbursed by the employer for rentals paid for sample and hotel rooms used in their sales activities. Each salesman was authorized to exhibit samples and solicit orders at prices and on terms fixed by the employer; the orders being thereafter transmitted to the corporation's office in St. Louis where the orders were accepted and shipment of merchandise made to the purchasers. No salesmen had 'authority to enter into contracts or to make collections.' Because the foregoing activities of the foreign corporation in Washington were 'systematic and continuous' and 'resulted in a large volume of interstate business, in the course of which (the corporation) received the benefits and protection of the laws of the state, including the right to resort to the courts for the enforcement of its rights' and 'the obligation * * * sued upon arose out of those very activities' the Supreme Court concluded 'that these operations establish sufficient contacts or ties with the state of the forum to make it reasonable and just according to our traditional conception of fair play and substantial justice to permit the state to enforce the obligations which appellant has incurred there.' The dissimilarity of the facts at bar to those involved in International Shoe is obvious. Those in Travelers Health, Perkins, Green and Schutt, supra, are equally distinguishing.
This action could not have been brought against Around-the-World in New York under 28 U.S.C.A. § 1391(c). Therefore, the action may not be removed as to Around-the-World under 28 U.S.C.A. § 1404(a). I do not construe the latter subsection as authorizing the transfer of an action as to one or as to less than all of several parties from one District to another. Therefore, even if this action might have been brought against the defendant Margulies in New York, and even if the transfer of this action to the Southern District of New York might subserve the convenience of the parties and witnesses and appear to be in the interest of justice as far as plaintiffs and defendant Margulies are concerned, I would still feel impelled to deny the present motion. It is accordingly so ordered.
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