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May 3, 1989

FRANCIS J. LaROSE, Plaintiff,
SPONCO MFG. INC., trading or doing business as "SPONCO", and PHOENIX SALES CORPORATION, REECE SUPPLY CO., and SKY-HY ERECTORS & EQUIPMENT, INC., jointly and severally, Defendants

The opinion of the court was delivered by: COHEN

 Presently before us, in this products liability action, is a motion to dismiss for lack of in personam jurisdiction, filed by defendant, Reece Supply Co. of Dallas, Inc. ("Reece"). Reece claims that it lacks the minimum contacts necessary to be haled into New Jersey as it has never transacted business in this State; in short Reece claims to have never purposefully availed itself of the benefits of this jurisdiction, and therefore should not be subject to the concomitant burden of being subjected to suit here. Plaintiff, Francis J. LaRose ("LaRose") argues a theory of injection of goods into the stream of commerce as a basis for our holding in personam jurisdiction over Reece, urging that because Reece allegedly sold the subject defective product in question, an aerial ladder truck, to LaRose's employer Riley Signs of Pleasantville, New Jersey ("Riley") in a face-to-face transaction, Reece therefore knew that the product would be used in New Jersey because Riley must have so indicated to them. One of the main factual questions contested by both sides is how the sale transaction of the aerial ladder occurred and whether Reece was aware that this product was purchased for use solely in New Jersey. We conclude, for the reasons set forth below, that there is no in personam jurisdiction in this Court, and that pursuant to 28 U.S.C. § 1406(a) this portion of the case will be transferred to the United States District Court for the Northern District of Texas.


 Francis LaRose, was a sign maintenance worker living in New Jersey, employed by Riley Signs, a sign maintenance company located in Pleasantville, New Jersey and operating solely in New Jersey until he was severely injured in an accident in Atlantic City on January 29, 1987. While LaRose was perched on a raised and extended fifty-five foot aerial ladder mounted on a Chevrolet truck chassis, manufactured by the Sponco Mfg. Co. ("Sponco"), another defendant in this case, allegedly as a result of its defective condition and unsafe design, the Sponco aerial ladder suddenly uncontrollably retracted in a "free-fall fashion" causing LaRose to plummet approximately forty feet to the pavement below. As a result of his significant injuries resulting from the fall, LaRose claims to be totally disabled and unable to continue working at any job. LaRose, a New York resident, *fn1" filed suit in New Jersey State Court, and the action was properly removed to this Court with jurisdiction predicated upon 28 U.S.C. § 1332. The defendants are Sponco Mfg. Co. of Ottowa, Kansas, the manufacturer of the aerial ladder; Sponco's parent company, Phoenix Sales Corp.; Reece, a Texas based company; and Sky-Hy Erectors & Equipment, Inc. of Plainfield, New Jersey, the company that reconstructed and rebuilt the aerial ladder for Riley in 1984. Riley is not named as a defendant.

 Primarily at issue, in our consideration of this motion, is the manner in which the vehicle in question, the Sponco aerial ladder truck, came into Riley's possession. Plaintiff alleges that representatives of Reece were present at a National Electric Sign Association Convention ("NESA") in Las Vegas, Nevada in May of 1979, as were representatives of Riley and Sponco. Plaintiff avers that representatives of Reece sold the Sponco aerial ladder truck in a face-to-face transaction to representatives of Riley, and that Riley indicated to Reece's sales people that they intended to use this piece of equipment solely in connection with their New Jersey business. Plaintiff argues that this face-to-face transaction suffices to posit in personam jurisdiction in this Court, even though all of the traditional minimum contacts are lacking. Jurisdiction is proper even though there is this lack of traditional contacts according to plaintiff, because Reece's sales of the product "extend[ed] to New Jersey-based customers, as evidenced not only by Reece's purchase of the subject Sponco unit for demonstration at a national trade convention in Las Vegas open to customers nationwide, but by the fact that Reece indeed sold the subject product to Riley Signs, a customer based exclusively in New Jersey." Plaintiff's Brief in Opposition at 5, 6. We take this to be an "injection into the stream of commerce" argument, which has in some instances supported in personam jurisdiction. See, e.g., Asahi Metal Industry Co. v. Superior Court of Calif. of Solano County, 480 U.S. 102, 94 L. Ed. 2d 92, 107 S. Ct. 1026 (1987). As evidence of the face-to-face transaction, plaintiff proffers a Seller, Donor, or Trader's Affidavit dated May 14, 1979 which indicates that Reece Supply Company sold the involved vehicle to Riley Signs for twenty-five thousand dollars.

 Reece suggests that the events at the NESA convention occurred in a significantly different manner. Rather than Reece being involved in a face-to-face transaction with Riley, defendant alleges that representatives of Sponco sold the product to Riley. See Affidavit of Alton Herring at 2 (Dec. 23, 1988). However, due to an exclusive distribution franchise agreement between Sponco as wholesaler and Reece as retailer, Sponco was precluded from selling directly to Riley while in Reece's exclusive distribution territory. Therefore the sale had to be transacted "through" Reece, although Alton Herring, Executive Vice-President of Reece avers that "at no time did Reece Supply Co. of Dallas, Inc. ever handle the truck sale or put it [the truck] in inventory at its premises." Affidavit of Alton Herring at 2 (Sept. 26, 1988). Richard Reece, President of Reece, who was also present at the NESA convention also states that "at no time during the convention, did any employee of Reece Supply Co. of Dallas, Inc. sell in a face-to-face manner the 1979 Chevrolet truck to the person or company who bought it off the convention floor; this sale transaction was made by and between employees of Sponco Mfg., Inc. and the buyer and was not participated in by those identified employees of Reece Supply Co. of Dallas, Inc., who were present at the convention." Affidavit of Richard Reece, at 2 (Dec. 20, 1988).

 Thus, Reece claims only to have done the paperwork necessary for the transaction because Sponco was foreclosed from direct sales to the public by the distribution franchise agreement, and did not purposefully avail itself of the benefits of doing business in New Jersey, as Reece did not "inject" anything into the stream of commerce, but merely transferred title after the goods were placed into that stream by Sponco.

 II. Reece's Motion to Dismiss for Lack of in personam Jurisdiction

 Reece has moved, pursuant to Fed. R. Civ. P. 12(b)(2), to dismiss for lack of in personam jurisdiction. The burden of establishing that this Court possesses in personam jurisdiction over a party is always placed on the party asserting its existence, in this case, the plaintiff. See, e.g., Provident Nat. Bank v. Cal. Fed. Sav. & Loan Ass'n., 819 F.2d 434, 437 (3d Cir. 1987). To overcome this challenge, plaintiff is required to establish either that this cause of action arose specifically from defendant's particular activities within the forum State ("specific jurisdiction") or that defendant engaged in "continuous and systematic" contacts with the forum State, New Jersey ("general jurisdiction"). See, e.g., Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414, 80 L. Ed. 2d 404, 104 S. Ct. 1868 (1984).

 Plaintiff here is asserting specific jurisdiction arising from the injection into the stream of commerce by Reece of the defective product with knowledge that the product would come to rest in New Jersey. He need only establish a prima facie case of jurisdiction at this point, since the factual record only contains pleadings and affidavits. See, e.g., Data Disc, Inc. v. Systems Technology Associates, Inc., 557 F.2d 1280, 1285 (9th Cir. 1977) ("If a plaintiff's proof is limited to written materials, it is necessary only for these materials to demonstrate facts which support a finding of jurisdiction in order to avoid a motion to dismiss." This is so because "any greater burden - such as proof by a preponderance of the evidence - would permit a defendant to obtain a dismissal simply by controverting the facts established by a plaintiff through his own affidavits and supporting materials."). Thus, here plaintiff would meet the threshold burden of pleading/persuasion if his pleadings and affidavits are sufficient to support a finding of jurisdiction. *fn2"

 In the process of determining whether plaintiff has met this burden, we are mindful that pleadings and affidavits are to be considered in the light most favorable to the plaintiff, as non-moving party. Warth v. Seldin, 422 U.S. 490, 501, 45 L. Ed. 2d 343, 95 S. Ct. 2197 (1975); see also Pharmaceutical Group Services, Inc. v. National Pharmacies, Inc., 592 F. Supp. 1247, 1248 (E.D. Pa. 1984). Although neither the Third Circuit nor the Supreme Court has determined whether we should resolve factual discrepancies in juxtaposed affidavits in favor of the party bearing the burden of establishing jurisdiction, several other courts have suggested that the proper course is to resolve such discrepancies in the burdened party's favor, which in this case is the plaintiff. See Pharmaceutical Group Services, supra at 1248; Felicia v. Gulf American Barge, Ltd., 555 F. Supp. 801, 803 n.1 (N.D. Ill. 1983). See also United States Ry. Equip. Co. v. Port Huron & Detroit R. Co., 495 F.2d 1127, 1128 (7th Cir. 1974); O'Hare Int'l. Bank v. Hampton, 437 F.2d 1173, 1176 (7th Cir. 1971).

 We agree that this is the most prudent course relying on the Court's rationale in Data Disk, supra 557 F.2d at 1285, quoted above for the related concept of level of burden. It makes sense to us that to simply allow defendant to controvert plaintiff's affidavits with their own versions and then resolve discrepancies in its favor would always lead to the conclusion that the defendant should be dismissed. We do not think that is a prudent result, at such an early stage of litigation, without the benefit of a full evidentiary hearing. Cautious as we are about any potential "opening of the litigation floodgates," we believe that by resolving discrepancies in favor of the plaintiff (or party with the burden) we will not be opening the floodgates, nor will we be foreclosing plaintiffs by a knee-jerk reaction. The converse of this mechanistic approach, resolving discrepancies in plaintiff's favor, is not so troublesome as the plaintiff still has the burden of making a prima facie case, which some plaintiffs will invariably fail to make.

 Finally, a corollary to the rule we have just stated at length is that until either an evidentiary hearing is had or trial is reached, once the plaintiff has met the burden and established a prima facie case of jurisdiction, that suffices, regardless of any controverting presentation by the moving party, to defeat the motion. Marine Midland Bank, N.A. v. Miller, 664 F.2d 899, 904 (2d Cir. 1981). Thus, if plaintiff meets the prima facie burden, he may proceed to trial, and may only be challenged to establish jurisdiction again at a pre-trial hearing where the burden is then raised to a preponderance of the evidence standard, such as on a motion for summary judgment, or at trial where the higher burden also attaches, but no other preliminary motions on the papers can re-visit the jurisdiction issue. Marine Midland Bank, supra.

 We now turn to the more difficult question of whether plaintiff has set forth a prima facie showing of in personam jurisdiction. Plaintiff's and defendants' submitted affidavits are not minorily inconsistent, rather there are significant discrepancies in what transpired at the NESA convention. Accordingly we take ...

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