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A.v. IMPORTS v. COL DE FRATTA
October 24, 2001
A.V. IMPORTS, INC., PLAINTIFF,
COL DE FRATTA, S.P.A., ET AL., DEFENDANTS.
The opinion of the court was delivered by: Cooper, District Judge
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.
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.)
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
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.
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.
In light of the plurality opinion of Justice O'Connor in Asahi,
therefore, defendant Cielo must have "purposefully availed" itself of the
forum state in order for the Court to exercise personal jurisdiction over
it.*fn3 Plaintiff maintains that Cielo
had positive knowledge that its product is imported into, and sold in,
New Jersey (Pl.'s Br. at 8), and Cielo concedes such knowledge (Def.'s
Reply Br. in Supp. of Mot. to Dismiss ("Def.'s Reply Br.") at 2). The
parties agree that Cielo's mere awareness that Maestro Italiano is
imported into, and sold in, New Jersey would be insufficient alone to
establish minimum contacts. (Pl.'s Br. at 6-7; Def.'s Reply Br. at 2.)
Cielo argues that the Court lacks personal jurisdiction over it because
it does not have any office in New Jersey, does not own or lease any
property in New Jersey, does not have any employees in New Jersey, and
does not pay any taxes in or to New Jersey. (Def.'s Br. in Supp. of
Motion to Dismiss ("Def.'s Br.") at 2, 5.) The dearth of an office,
property, employees, and tax payments, however, does not decide the issue
because the absence of a "physical presence" in New Jersey is not
determinative for jurisdictional purposes. Burnham v. Super. Ct. of
Cal., 495 U.S. ...
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