The opinion of the court was delivered by: BECHTLE
Presently before the court is defendant's motion to dismiss plaintiff's complaint on the grounds that this court lacks jurisdiction over the subject matter of the complaint and jurisdiction over the person of the defendant and plaintiff's motion for sanctions. For the reasons stated herein, defendant's motion will be denied and plaintiff's motion will be dismissed as moot.
Plaintiff, Provident National Bank, is a national banking association with its principal place of business in the Commonwealth of Pennsylvania. Defendant, the California Federal Savings and Loan Association, is a Federal Savings and Loan Association, federally chartered under the Home Owners' Loan Act of 1933. See 12 U.S.C. § 1461 et seq. Defendant has 138 branch offices in California, 37 branch offices in Florida, 13 branch offices in Georgia, and 6 branch offices in Nevada. A substantial amount of defendant's business is conducted in those four states, California, Florida, Georgia, and Nevada.
A smaller amount of defendant's business is conducted in Pennsylvania. Defendant had on December 31, 1984, 631 depositors with Pennsylvania addresses of a total number of 953,390 depositors. Defendant's Pennsylvania depositors number only.066% of defendant's total number of depositors. In addition, the Pennsylvania depositors contributed a mere $10,000,000.00 to defendant's $14 billion of total deposits, or.071% of defendant's total deposits. Moreover, on December 31, 1984, a mere $10,000,000.00 of defendant's total outstanding loans of $12 billion could be traced to Pennsylvania residents. In other words, only.083% of defendant's total outstanding loans on December 31, 1984 were to Pennsylvania residents.
On January 8, 1985, plaintiff agreed to sell a Negotiable Certificate of Deposit (the "Certificate") to Asset Management Fund for Savings Institutions, Inc.
in the amount of $5 million at a rate of $8.30%. The Certificate was to have a term of 61 days, beginning on January 9, 1985 and maturing on March 11, 1985. It was to be delivered, physically, on January 9, 1985, by Manufacturers Hanover Bank,
defendant's transfer agent for all negotiable instruments in the United States, to State Street Boston Securities Service Corporation.
The offer, acceptance, negotiation, and arrangement of the sale of the Certificate was done on January 8, 1985 in a telephone call between P. Louis Johnson ("Johnson"), defendant's Vice President Corporate Savings, and Mark McEntee ("McEntee"), an employee of Lehman Management Co., Inc. At the time of the phone call, Johnson was physically located in California, and McEntee was in New York. At the end of the phone conversation, Johnson agreed to send McEntee a letter confirming the conversation and, at McEntee's request, to send a copy of that letter to Provident Institutional Management Corporation in Pennsylvania.
On January 9, 1985, the confirmation letter was sent to McEntee and a copy of that letter was sent to Provident Institutional Management Corporation in Pennsylvania.
Plaintiff provided the funds on January 9, 1985 for the purchase of the Certificate. The Certificate was not delivered on January 9, 1985. In fact, the Certificate had not been delivered on February 25, 1985, 47 days after the scheduled delivery date.
At the maturity of the Certificate, defendant made a repayment. Plaintiff asserts in this lawsuit, however, that defendant's repayment was inadequate, or, in other words, defendant failed to repay plaintiff $54,180.56. Plaintiff seeks a recovery of damages in the amount of $54,180.56 plus interest and costs.
In its present motion to dismiss, defendant argues (1) that this court, a Federal District Court, lacks diversity jurisdiction because, as a federally chartered savings and loan association, defendant is not a citizen of any state for diversity jurisdiction purposes and (2) that this court, sitting in Pennsylvania, cannot assert general jurisdiction over the person of the defendant because the defendant has not had continuous and systematic business contacts with Pennsylvania at any time. Defendant contends, and plaintiff concedes, that this court cannot assert specific jurisdiction because plaintiff's claim does not arise out of or relate to defendant's contacts with Pennsylvania.
1. Subject Matter Jurisdiction