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Renner v. Lanard Toys Limited

argued: July 14, 1994.

DAVID J. RENNER AND DARCY L. RENNER, HIS WIFE, APPELLANTS
v.
LANARD TOYS LIMITED



On Appeal from the United States Court for the Western District of Pennsylvania. (D.C. Civ. No. 93-cv-00317E).

Before: Sloviter, Chief Judge, Roth, Circuit Judge, and Pollak,*fn* District Judge

Author: Sloviter

Opinion OF THE COURT

SLOVITER, Chief Judge.

Appellants David J. Renner and his wife, Darcy L. Renner, appeal from the district court's order dismissing for lack of personal jurisdiction their products liability case against the defendant, Lanard Toys, Ltd. This case calls upon us to consider the current status of the "stream of commerce" theory of establishing specific jurisdiction over a defendant, a theory we have not addressed since our opinion in Max Daetwyler Corp. v. Meyer, 762 F.2d 290 (3d Cir.), cert. denied, 474 U.S. 980, 88 L. Ed. 2d 336, 106 S. Ct. 383 (1985). Since then, the Supreme Court issued its opinion in Asahi Metal Industry Co. v. Superior Court, 480 U.S. 102, 94 L. Ed. 2d 92, 107 S. Ct. 1026 (1987).

I.

On July 14, 1991, David J. Renner was severely wounded when a Lanard Toy "prop shots stuntplane" he was using allegedly exploded, lodging shards of plastic into his face and left eye. The "prop shots stuntplane" is a cylinder with a propeller on it that flies skyward when a ripcord is pulled on the plane's handheld launching pad. The toy had been purchased for Renner's nephew at the McCrory's store in Erie, Pennsylvania. It had been supplied to McCrory's by its buying agent, Trade Power Associates, Ltd., which had purchased the toy from Lanard in Hong Kong.

On February 11, 1993, the Renners filed a complaint in the Erie County Court of Common Pleas alleging causes of action based on negligence, breach of warranty, strict liability, and loss of consortium. The complaint alleges that Lanard is a Hong Kong corporation with an office in New York, and is subject to jurisdiction in Pennsylvania. Lanard removed the case to the district court on November 12, 1993 and filed a motion to dismiss for lack of personal jurisdiction three days later, or November 15, 1993.

In support of its motion to dismiss, Lanard submitted a written statement, denominated an affidavit,*fn1 to the district court by its Managing Director, James W. Hesterberg, asserting that Lanard manufactures toys in Hong Kong and sells them to independent distributors F.O.B. (freight-on-board) Hong Kong and does not sell or manufacture toys in Pennsylvania; that Lanard owns no real property in Pennsylvania; that it has no employees, offices, post office boxes or bank accounts in Pennsylvania; that it has no exclusive distributors, or any financial interest in or control over any of its distributors; and that it has no way of knowing or controlling where distributors market its products.

In response, the Renners presented little evidence that would connect Lanard with Pennsylvania. They submitted two affidavits detailing that Lanard toys are still sold in Pennsylvania and are carried by K-Mart and Hills Department Stores in addition to McCrory's. The Renners also submitted two documents, that apparently had been produced to them by Lanard, each titled a "Test Report." App. at 116, 123. One report, dated November 13, 1990, is six pages and details the results of tests run by a Hong Kong laboratory on styles of the prop shot plane/helicopter to determine whether the samples complied with the "McCrory Stores Protocol with reference to ASTM Standard Consumer Safety Specification on Toy Safety F963-86." App. at 116, 118. The report lists McCrory Stores in York, Pennsylvania as the "Applicant." The report contains a notation showing that it was directed to the attention of a Mr. Michael Capuano, and "Debby (Lanard Toys Ltd)." App. at 116. The second, dated August 31, 1991, is a similar six page report, lists McCrory Stores as the "Applicant," and also shows it was directed to the attention of Mr. Capuano and "Miss Debbie Chan (Lanard)." App. at 122.

Plaintiffs filed their response to the motion to dismiss on December 7, 1993. Two days later, on December 9, 1993, the district court dismissed the case for lack of personal jurisdiction because it found that there was no evidence that Lanard had "purposefully availed" itself of Pennsylvania's jurisdiction. District court op. at 1. Plaintiffs' motion for reconsideration was filed December 13 and denied by the Court on December 15. The plaintiffs filed a timely notice of appeal.

II.

In determining whether a federal court can maintain jurisdiction over a nonresident defendant, we must first determine whether the exercise of jurisdiction is authorized under the state (or appropriate federal) long-arm statute and then whether it meets the requirements of the Due Process Clause of the United States Constitution. Pennsylvania's long-arm statute authorizes jurisdiction to the fullest extent permissible under the Constitution:

the jurisdiction of the tribunals of this Commonwealth shall extend to all persons . . . to the fullest extent allowed under the Constitution of the United States and may be based on the most minimum contact with this ...


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