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LIGHTING SYS. v. INTERNATIONAL MERCHANDISING ASSOC

January 22, 1979

LIGHTING SYSTEMS, INC.
v.
INTERNATIONAL MERCHANDISING ASSOCIATES, INC., et al.



The opinion of the court was delivered by: KNOX

The plaintiff in this suit has alleged breach of confidential relationship, borrowing of trade secrets, unfair competition and patent infringement. It has set forth these claims in several counts. Count 1 claims tortious violation of a confidential relationship in that the parties entered into an agreement in Erie, Pennsylvania, on October 1, 1974, and it is averred that on September 30, 1975, the defendant's agent visited plaintiff's manufacturing plant in Erie and learned the details of plaintiff's manufacturing process with respect to a portable light manufactured by plaintiff and then used the information thus acquired to manufacture the same in competition with the plaintiff.

 The contract in question is dated October 1, 1974, and is signed by Lighting Systems, Inc., a Pennsylvania Corporation by E. B. Zelina, President and also signed by International Merchandising.

 Count 2 of the complaint charges unfair competition in violation of plaintiff's registered trademark for Tote-a-Lite by manufacturing a similar product known as "Lug-a-Lite" by defendant. Count 3 claims imputed liability on the defendant Hanimex Corporation Ltd., which is alleged to be the parent of International Merchandising and acting in concert therewith. Hanimex has neither appeared in this action nor filed any motions.

 Count 4 is a patent infringement action alleging that plaintiff held certain patents covering a portable light and the defendant had violated the thing.

 The defendants, International Merchandising Associates, Inc., Albert L. Bernard and Patricia Schoenberg have filed a motion to dismiss or to stay. It is claimed that there is no personal jurisdiction over the three named under the Pennsylvania Long Arm Statute, further that the patent count is improper in that venue is not properly laid in the Western District of Pennsylvania under 28 U.S.C. § 1400(b) of the Patent Act. It is further claimed that there is insufficient service of process and that the same is not evidenced by a certified or registered mail receipt. Finally, it is claimed that Counts 1, 2 and 3 of the complaint should be stayed because there is a similar suit pending in the Circuit Court of Cook County Illinois in which the Illinois Court of Appeals has held that there is personal jurisdiction of Lighting Systems, Inc. in Illinois. The Illinois complaint is captioned "International Merchandising Associates, Inc. v. Lighting Systems Inc. and Floyd Devroy," arising out of the same contract as that which forms the basis of the present case. The Illinois action involves breach of the contract which forms the basis of plaintiff's complaint in this federal court.

 (1) Jurisdiction under Pennsylvania Long Arm Statute.

 The present Pennsylvania Long Arm Statute is found in 42 Pa.C.S.A. 5321 as amended by the Act of April 28, 1978, eff. 60 days thereafter, i. e., on and after June 27, 1978. It replaces the old Pennsylvania Long Arm Statute previously found in 42 Pa.C.S.A. § 8301, et seq. (Act of November 15, 1972 P.L. § 1063 eff. 90 days thereafter and being the act in effect at the time the contract was entered into, hereinafter referred to as the old law.)

 Under the old law in Section 8309(a), it was provided that doing business consisted of the doing of a single act in this Commonwealth for the purpose of thereby realizing pecuniary benefit or doing a single act with the intention of initiating a series of such acts and that the defendant International Merchandising Associates Inc. is subject to the Pennsylvania Long Arm Statute under this Act having entered into the contract here in Pennsylvania.

 With respect to individuals long arm jurisdiction was provided in § 8303 covering a person who, acting individually or through an agent, servant or employee, committed a tortious act within this Commonwealth on or after August 30, 1970, and also § 8305 covering a non resident who, individually or through an agent, servant or employee, caused harm within this Commonwealth on or after August 30, 1970.

 Under the new Act, 42 Pa.C.S.A. § 5322, it is provided that jurisdiction over persons outside the Commonwealth exists in the case of doing a single act for the purpose of realizing pecuniary benefit or for causing harm or tortious injury inside the Commonwealth by an act or omission outside the Commonwealth. In § 5301 "person" is defined to include individuals, corporations and partnerships.

 We thus hold that under either Act a person acting or corporation acting outside the Commonwealth and causing harm as alleged in this complaint, whether the person be individual or corporation, is subject to long arm jurisdiction of the Pennsylvania Courts and hence subject to the jurisdiction of this Federal Court sitting in Pennsylvania in a diversity action. It is noted that under § 5322(b) it is provided that the legislature intended to exercise jurisdiction of the courts of the Commonwealth (which would include Federal Courts) to the fullest extent allowed under the Constitution of the United States, leaving it for the courts to determine in each case whether the basic principles of fairness as laid down in International Shoe Company v. Washington, 326 U.S. 310, 66 S. Ct. 154, 90 L. Ed. 95 (1945), have been violated.

 We hold that it is not unfair for the defendant corporation and Schoenberg who came to Erie, Pennsylvania and executed the contract to be required to stand suit in Pennsylvania. See Vespe Contracting Co. v. Anvan Corp., 433 F. Supp. 1226 (E.D.Pa.1977).

 The general rule is that the officers of a corporation are personally responsible for the alleged tortious conduct of the corporation if they personally take part in the commission of the tort or direct other officers, agents or employees to commit the act. Vespe, Supra, and see Zubik v. Zubik, 384 F.2d 267 (3d Cir. 1967). In other words a corporate officer who personally commits a tort in his capacity as an officer of the corporation can be held along with the corporation. This is sufficient to establish personal ...


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