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BOEING CO. v. SPAR AERO. PRODS.

July 24, 1974

THE BOEING COMPANY, a corporation, Plaintiff,
v.
SPAR AEROSPACE PRODUCTS LTD., 825 Caledonia Road, Toronto, Ontario, Canada, Defendant and LEVY INDUSTRIES LIMITED, 1400 Weston Road Toronto, Ontario, Canada, Defendant, YORK GEARS LIMITED, 825 Caledonia Road, Toronto, Ontario, Canada, Defendant



The opinion of the court was delivered by: VANARTSDALEN

 VanARTSDALEN, District Judge.

 Plaintiff, The Boeing Company (Boeing) brought this indemnity/contribution action against defendants, Spar Aerospace Products Ltd. (Spar), Levy Industries Limited (Levy), and York Gears Limited (York), for breach of express and implied warranties on the basis of the defective manufacture of certain helicopter component parts. Boeing is a Delaware corporation with its principal place of business in Pennsylvania, while the defendants are Canadian corporations with their principal places of business in Toronto, Canada.

 The three Canadian defendants have moved to dismiss the complaint for lack of in personam jurisdiction. Several affidavits and exhibits have been filed by the parties and oral argument has been presented. Since determination of this jurisdictional issue requires independent analysis of the activities of each of the defendants, separate treatment will be necessary. Preliminarily, however, certain facts and issues are applicable to all defendants and may be collectively discussed.

 None of the defendants are incorporated in Pennsylvania or registered to do business in the state. Pursuant to Fed. R. Civ. P. 4(e), *fn1" plaintiff served process on defendants according to the provisions of the former Pennsylvania "long-arm" statute. Pa. Stat. tit. 15 § 2011. The current "long-arm" statute, Pa. Stat. tit. 42 §§ 8301-8311, was not in effect at the time the presently disputed service was made. The validity of service therefore must be governed by the former "long-arm" statute, Pa. Stat. tit. 15 § 2011, as it was the law in effect at the time service was made. Benn. v. Linden Crane Co., 370 F. Supp. 1269, 1273-1274 (E.D. Pa. 1973); McCully-Smith Associates, Inc. v. Armour and Company, 349 F. Supp. 694, 695-696 (W.D. Pa. 1972); Nelson v. Doll Furniture Company, 304 F. Supp. 159, 161 (E.D. Pa. 1969).

 Section 2011 (B) of the former statute states:

 
Any foreign business corporation which shall have done any business in this Commonwealth, without procuring a certificate of authority . . . shall be conclusively presumed to have designated the Secretary of the Commonwealth as its true and lawful attorney authorized to accept, on its behalf, service of process in any action arising within this Commonwealth.

 A clear and literal reading of this provision indicates two basic jurisdictional requirements: (1) the foreign corporation must have done business in Pennsylvania and (2) the action must arise within Pennsylvania. As per the latter requirement, the Third Circuit concluded in Siders v. Upper Mississippi Towing Corporation, 423 F.2d 535 (3rd Cir. 1970), that it means nothing more than that the cause of action be filed in Pennsylvania. Id. at 537, n. 3. But see Keene v. Multicore Solders Ltd., 379 F. Supp. 1279, slip op. at 3 (E.D. Pa. 1974). *fn2" Given this interpretation, the "arise within" requirement of Section 2011 (B) is clearly satisfied in the instant case as suit was filed in Pennsylvania. However, even accepting, as defendants contend, that this language requires that the cause of action factually arise within Pennsylvania, see Keene v. Multicore Solders Ltd., supra, it is clear, under the facts of this case, that plaintiff's cause of action arises out of the sale and delivery of helicopter component parts to plaintiff in Pennsylvania for assembly in the helicopter herein involved at plaintiff's Pennsylvania plant. The instant action therefore clearly "arises within" Pennsylvania under any construction of that phrase, even though arguably plaintiff had no cause of action against defendants until plaintiff's liability to the crash victims was determined by settlement of the civil actions filed in California State Court.

 The sole remaining inquiry therefore is whether the defendants have done business in Pennsylvania within the meaning of Section 2011(C) and if so, whether the extension of jurisdiction over them as authorized by the "long-arm" statute would violate the constitutional mandates of due process.

 Section 2011(C), which defined doing business under the former statute, read after amendment in 1968:

 
For the purposes of determining jurisdiction of courts within this Commonwealth, the doing by any corporation in this Commonwealth of a series of similar acts for the purpose of thereby realizing pecuniary benefit or otherwise accomplishing an object, or doing a single act in this Commonwealth for such purpose, with the intention of thereby initiating a series of such acts, shall constitute "doing business." For the purposes of this subsection the shipping of merchandise directly or indirectly into or through this Commonwealth shall be considered the doing of such an act in this Commonwealth.
 
Pa. Stat. tit. 15 § 2011(C), as amended, Acts 1968, July 20, P.L. 459, No. 216 § 54.

 In order to establish "doing business" under any of the above methods of Section 2011(C), "a systematic course of conduct as contrasted with isolated or sporadic occurrences" has to be demonstrated. Gorso v. Bell Equipment Corporation, 476 F.2d 1216, 1221-1222 (3d Cir. 1973). The activities ...


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