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A.v. IMPORTS v. COL DE FRATTA

October 24, 2001

A.V. IMPORTS, INC., PLAINTIFF,
v.
COL DE FRATTA, S.P.A., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Cooper, District Judge

MEMORANDUM OPINION

This matter comes before the Court on the motion of defendant Cielo S.p.A. ("Cielo"), a/k/a Col de Fratta S.p.A., to dismiss for lack of personal jurisdiction. For the reasons expressed below, the motion to dismiss will be denied.

BACKGROUND

Plaintiff A.V. Imports is a Maryland corporation, and its principal business activity is the importation and distribution of wines. (Compl. ¶ 2.) Defendant Cielo is an Italian corporation that produces private label wines, including wines for export from Italy to the United States. (Compl. ¶ 31; Answer of Dufour ¶ 31.) "Maestro Italiano Merlot-Cabernet," the product at the center of this suit, is among the wines Cielo produces for export. (Aff. of Pierpaolo Cielo dated 6-18-00 ("Cielo Aff.") ¶ 9.) Defendant Dufour & Co. ("Dufour"), d/b/a Maestro Italiano, is a Massachusetts corporation that imports wines into the United States and does business in New Jersey. (Compl. ¶¶ 4, 29; Answer of Dufour ¶¶ 29, 30, 32.) Dufour imports into the United States and New Jersey the "Maestro Italiano Merlot-Cabernet" produced by Cielo. (Answer of Dufour ¶ 32.)
Plaintiff filed this action against defendants for (1) trade dress infringement under 15 U.S.C. § 1125, and (2) deceptive acts and practices in violation of the New Jersey Trade Names, Trademarks and Unfair Trade Practices Act, N.J. Stat. Ann. 56:4, and (3) unjust enrichment. (Compl. Counts I-III.) "Maestro Italiano Merlot-Cabernet" allegedly infringes the trade dress of plaintiff's wine identified as "Luna di Luna Merlot-Cabernet Blend." (Id.)

DISCUSSION

Defendant Cielo moves, pursuant to Federal Rule of Civil Procedure 12(b)(2), to dismiss for lack of personal jurisdiction. Rule 4(e) of the Federal Rules of Civil Procedure permits a district court sitting in diversity to assert personal jurisdiction over a nonresident defendant to the extent allowed by the law of the state in which the district court sits. New Jersey's long-arm rule, New Jersey Civil Practice Rule 4:4-4, permits jurisdiction over a nonresident defendant to the "uttermost limits permitted by the United States Constitution." Avdel Corp. v. Mecure, 58 N.J. 264, 268, 277 A.2d 207, 209 (1971); see also Carteret Sav. Bank, FA v. Shushan, 954 F.2d 141, 145 (3d Cir.), cert. denied, 506 U.S. 817 (1992); Am. Tel. & Tel. Co. v. MCI Communications Corp., 736 F. Supp. 1294, 1301 (D.N.J. 1990). The Due Process Clause of the Fourteenth Amendment "limits the reach of long-arm statutes so that a court may not assert personal jurisdiction over a nonresident defendant who does not have `certain minimum contacts with [the forum] such that the maintenance of the suit does not offend `traditional notions of fair play and substantial justice.'" Provident Nat'l Bank v. Cal. Fed. Sav. & Loan Ass'n, 819 F.2d 434, 436 (3d Cir. 1987) (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 320 (1945)). The nature of the defendant's contacts with the forum state must be such that the defendant "should reasonably anticipate being haled into court there." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980). An essential element in each case is "that there be some act by which the defendant purposely avails itself of the privilege of conducting activities with the forum State, thus invoking the benefits and protections of its laws." Hanson v. Denckla, 357 U.S. 235, 253 (1958).
Once a jurisdictional defense has been raised, the plaintiff bears the burden of demonstrating that the defendant's contacts with the forum state are sufficient to give the court in personam jurisdiction. N. Penn Gas Co. v. Corning Natural Gas Corp., 897 F.2d 687, 689 (3d Cir.), cert. denied, 498 U.S. 847 (1990); Apollo Techs. Corp. v. Centrosphere Indus. Corp., 805 F. Supp. 1157, 1182 (D.N.J. 1992). The plaintiff must "sustain its burden of proof through `sworn affidavits or other competent evidence.'" N. Penn Gas, 897 F.2d at 689 (quoting Stranahan Gear Co. v. NL Indus., Inc., 800 F.2d 53, 58 (3d Cir. 1986)). In deciding whether the plaintiff has satisfied that burden, a court resolves all disputes concerning material facts in the plaintiff's favor. LaRose v. Sponco Mfg. Inc., 712 F. Supp. 455, 458 (D.N.J. 1989). Prior to trial, a plaintiff need only make a prima facie showing of jurisdiction by "establishing with reasonable particularity sufficient contacts between the defendant and the forum state." Mellon Bank (East) PSFS, Nat'l Ass'n v. Farino, 960 F.2d 1217, 1223 (3d Cir. 1992) (citation omitted).
The plaintiff may meet its burden by establishing that a court has either "general" or "specific" jurisdiction. Provident Nat'l Bank, 819 F.2d at 437. A nonresident's contacts with the forum must be "continuous and substantial" to establish general jurisdiction.*fn1 Id. Specific jurisdiction is "invoked when the claim is related to or arises out of the defendant's contacts with the forum." Dollar Sav. Bank v. First Sec. Bank, 746 F.2d 208, 211 (3d Cir. 1984).
For a court to properly exercise personal jurisdiction, the plaintiff must satisfy a two-part test. IMO Indus., Inc. v. Kiekert AG, 155 F.3d 254, 259 (3d Cir. 1998); see also Vetrotex Certainteed Corp. v. Consol. Fiber Glass Prods. Co., 75 F.3d 147, 150-51 (3d Cir. 1996). First, the plaintiff must demonstrate that the defendant has sufficient minimum contacts with the forum state. IMO Indus., Inc., 155 F.3d at 259. Second, if minimum contacts are established, jurisdiction may be found when the court determines, in its discretion, that to do so would comport with "traditional notions of fair play and substantial justice." Id.

A. Minimum Contacts

The issue of minimum contacts generally is fact sensitive in that it turns on the "`quality and nature of a defendant's activity [in relation to the forum state.]'" Pennzoil Prods. Co. v. Colelli & Assocs., Inc., 149 F.3d 197, 203 (3d Cir. 1998) (quoting Max Daetwyler Corp. v. R. Meyer, 762 F.2d 290, 298 (3d Cir. 1985)). Plaintiff relies on the stream-of-commerce theory as a basis for assertion of personal jurisdiction over the nonresident defendant. (Pl.'s Br. in Opp'n to Def.'s Mot. to Dismiss ("Pl.'s Br.") at 5-6.) Under that theory, a forum state may exercise personal jurisdiction over a nonresident defendant that delivered its goods, albeit indirectly, into the state and either derived a substantial benefit or had a reasonable expectation of deriving such a benefit. Pennzoil Prods. Co., 149 F.3d at 203. The stream-of-commerce theory, therefore, is an independent basis for satisfying the minimum-contacts standard, see, e.g., Woodson, 444 U.S. at 297, and New Jersey long ago adopted the stream-of-commerce theory as a basis for finding in personam jurisdiction over a foreign manufacturer or distributor. Charles Gendler & Co. v. Telecom Equip. Corp., 102 N.J. 460, 477, 508 A.2d 1127, 1136 (1986).*fn2
The United States Supreme Court discussed the stream-of-commerce theory in Asahi Metal Industry Co. v. Superior Court of California, Solano County, 480 U.S. 102 (1987). Writing for a plurality of four, Justice O'Connor concluded that the mere placement of a product into the stream of commerce with an awareness that it may end up in a specific state is not enough to establish minimum contacts. Id. at 112 (plurality opinion) ("[A] defendant's awareness that the stream of commerce may or will sweep the product into the forum State does not convert the mere act of placing the product into the stream into an act purposefully directed toward the forum State."). Because minimum contacts must have some basis in a defendant's purposeful availment of the privilege of conducting activities in the forum state, some "additional conduct" that "may indicate an intent or purpose to serve the market in the forum State" is required before personal jurisdiction may be exercised over the defendant. Id. at 111-12. Types of "additional conduct" needed to establish purposeful availment include, inter alia, "designing the product for the market in the forum State, advertising in the forum State, establishing channels for providing regular advice to customers in the forum State, or marketing the product through a distributor who has agreed to serve as the sales agent in the forum State." Id. at 112.

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