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IMAGE TEN v. WALTER READE ORGANIZATION (07/02/74)

decided: July 2, 1974.

IMAGE TEN, INC.
v.
WALTER READE ORGANIZATION, INC., APPELLANT



Appeal from order of Court of Common Pleas, Civil Division, of Allegheny County, Oct. T., 1972, No. 2086, in case of Image Ten, Inc. v. The Walter Reade Organization, Inc.

COUNSEL

Thomas Levendos, with him George Shorall, for appellant.

Andrew M. Schifino, with him Louis J. Grippo, for appellee.

Jones, C. J., Eagen, O'Brien, Pomeroy, Nix and Manderino, JJ. Opinion by Mr. Justice Manderino. Mr. Justice Roberts took no part in the consideration or decision of this case. Mr. Justice Pomeroy concurs in the result.

Author: Manderino

[ 456 Pa. Page 487]

The appellant, The Walter Reade Organization, Inc., and the appellee, Image Ten, Inc., entered into a contract on June 10, 1968. Under the contract the appellant acquired, for a consideration, the "sole right and privilege" to distribute, exhibit, rent, advertise and otherwise market the appellee's full-length motion picture entitled "Night of the Living Dead." In February of 1972, the appellee filed a complaint in equity, demanding an injunction, an accounting and damages for appellant's alleged breach of contract. An amended complaint was later permitted. Service was made through the Secretary of the Commonwealth pursuant to section 1011(B) of the Business Corporation Law, Act of May 5, 1933, P. L. 364, art. X, § 1011(B), as amended, 15 P.S. § 2011(B). The trial court dismissed appellant's preliminary objections in the nature of a demurrer alleging lack of jurisdiction. This appeal followed.

The central issue raised by the appellant is whether the shipping of motion picture films into Pennsylvania, either directly or indirectly, is sufficient to meet the "doing business" requirement of the Pennsylvania "long-arm statute." Act of May 5, 1933, P. L. 364, art. X, § 1011(B), as amended, 15 P.S. § 2011(B) (repealed and replaced by Act of November 15, 1972, P. L. 1063, No. 271, § 5, 42 Pa. S. § 8309.

After the appellant contracted with the appellee, it entered into agreements with numerous distributors and exhibitors in Pennsylvania for the showing of appellee's motion picture. Pursuant to those agreements, appellant has shipped the motion picture from outside of Pennsylvania into Pennsylvania where it has been shown on numerous occasions between 1968 and the time of the filing of the appellee's complaint.

[ 456 Pa. Page 488]

Appellant does not dispute the above facts but contends that they are insufficient to constitute "doing business" because appellant has no offices in Pennsylvania; is not listed in any Pennsylvania telephone directories; has no agents in Pennsylvania; has no salesmen, clerks, or employees in Pennsylvania; enters into all contracts with Pennsylvania distributors and exhibitors in the State of New York; and does business with the Pennsylvania distributors and exhibitors by telephone and mail from the State of New York.

Appellant first argues that in order for jurisdiction to attach under the Business Corporation Law, the presence of appellant or its agents in some substantial form is required. According to appellant, the presence of independent contractors or distributors in Pennsylvania is not sufficient to constitute "doing business" in Pennsylvania. Appellant cites the following cases: Wenzel v. Morris Distrib. Co., 439 Pa. 364, 266 A.2d 662 (1970); Yoffee v. Golin, 413 Pa. 154, 196 A.2d 317 (1964); Namie v. DiGirolamo, 412 Pa. 589, 195 A.2d 517 (1963). We do not agree.

Under Pennoyer v. Neff, 95 U.S. 714, 24 L. Ed. 565 (1878), the due process inquiry was addressed to the "presence" of the defendant in the forum state. International Shoe Co. v. Washington, 326 U.S. 310, 90 L. Ed. 95, 66 S. Ct. 154 (1945), looked to "minimum contacts" in the forum state, not "physical presence" in the forum state. International Shoe Co. said: "[D]ue process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice' . . . ." ...


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