The opinion of the court was delivered by: NEWCOMER
Presently before this Court are Motion of Defendant B.A.T. Industries p.l.c. to Dismiss the First Amended Complaint for Lack of Personal Jurisdiction, and plaintiffs' response thereto, and defendant's reply thereto. For the following reasons, the Court grants defendant's motion. Also before this Court are Motion to Quash and for Entry of a Protective Order of Defendant B.A.T. Industries p.l.c., and plaintiffs' response thereto, and defendant's reply thereto. For the following reasons, the Court denies defendant's motion as moot. Also before this Court is the Motion of Plaintiffs to Add British American Tobacco Company as a Defendant. For the following reasons, the Court grants plaintiffs' motion.
On August 27, 1996, this action was removed from state court. On December 2, 1996, plaintiffs
filed a "First Amended Complaint -- Class Action." B.A.T. Industries p.l.c. ("BAT") was one of the defendants named in the complaint, along with a few of BAT's subsidiaries, namely Brown & Williamson Tobacco Corporation ("B&W"), Batus, Inc. ("Batus") and Batus Holdings, Inc. ("Batus Holdings")
On January 29, 1997, BAT filed a motion to dismiss plaintiffs' first amended complaint for lack of personal jurisdiction. By Order entered February 12, 1997, the Court dismissed BAT's motion without prejudice to BAT refiling such a motion after the Court disposes of plaintiffs' motion for class certification.
On March 28, 1997, BAT filed a motion to quash and for entry of a protective order in response to discovery requests served on it by plaintiffs. On May 1, 1997, plaintiffs filed a combined memorandum which contained (1) a response to BAT's motion to dismiss for lack of personal jurisdiction,
(2) a response to BAT's motion to quash discovery and for entry of a protective order, and (3) a motion to add British American Tobacco Company ("BATCo") as a party defendant. On May 23, 1997, BAT filed a reply to plaintiffs' response to BAT's motion to dismiss and motion to quash discovery and for entry of a protective order. In its reply, counsel for BAT stated that it does not represent BATCo at the present time, and thus they are not in a position to oppose plaintiffs' motion on behalf of BATCo.
In response, plaintiffs argue that BAT's motion to dismiss is "truly without basis." In sum, plaintiffs argue that (1) BAT itself has engaged in tortious activity sufficient to justify the exercise of specific jurisdiction pursuant to Pennsylvania's long-arm statute; (2) the actions of BAT's tobacco subsidiary, defendant B&W, should be imputed to BAT; and (3) BAT is the legal successor to BATCo. Based on these reasons, plaintiffs argue that the Court can properly exercise personal jurisdiction over BAT.
In its motion to quash and for the entry of a protective order,
BAT argues that "plaintiffs' attempt to take discovery from it is at odds with settled principles of judicial administration and fairness that require a plaintiff to plead specific facts demonstrating a basis for jurisdiction before being entitled to subject an overseas defendant to discovery, particularly the full-blown merits discovery plaintiffs seek here." In response, plaintiffs contend that, at a minimum, they should be entitled to conduct discovery into jurisdictional facts before the Court dismisses plaintiffs' amended complaint against BAT for lack of personal jurisdiction.
Pursuant to Rule 21 of the Federal Rules of Civil Procedure, plaintiffs move to add BATCo as a party defendant. Plaintiffs argue that research has demonstrated that BATCo is involved in the wrongful actions alleged in plaintiffs' first amended complaint. No response has been filed to plaintiffs' motion. The Court will address the issues raised by the present motions seriatim.
Once a defendant raises a personal jurisdiction defense, the plaintiff bears the burden of coming forward with a set of facts sufficient to create a prima facie case of jurisdiction. Mellon Bank (EAST) PSFS v. Farino, 960 F.2d 1217, 1223 (3d Cir. 1992); Provident Nat'l Bank v. California Fed. Sav. & Loan Ass'n, 819 F.2d 434, 437 (3d Cir. 1987). A plaintiff's jurisdictional allegations must be supported with appropriate affidavits, documents or other competent evidence, because a Rule 12(b)(2) motion "requires resolution of factual issues outside the pleadings." Time Share Vacation Club v. Atlantic Resorts, Ltd., 735 F.2d 61, 67 n.9 (3d Cir. 1984).
A federal district court is permitted to exercise "personal jurisdiction over a nonresident of the state in which the court sits to the extent authorized by the law of the state." Provident, 819 F.2d at 436 (citing Fed. R. Civ. P. 4(e)). Under Pennsylvania's long-arm statue, there exists two distinct bases for finding that a defendant is subject to personal jurisdiction -- general jurisdiction and specific jurisdiction. "General jurisdiction exists when the non-resident is deemed 'present' in the state by virtue of its voluntary action, such as maintaining continuous and substantial forum contacts, consenting to jurisdiction, or being domiciled in the state." Brooks v. Bacardi Rum Corp., 943 F. Supp. 559, 561 (E.D. Pa. 1996).
Specific jurisdiction exists if the cause of action arises through any one of the following contacts with the state: (1) transacting business in Pennsylvania, (2) contracting to supply services or things in the Commonwealth, (3) causing harm or tortious injury by an act or omission in Pennsylvania, (4) causing harm or tortious injury by an act or omission outside the state, (5) having an interest in or using or possessing real property in the state, (6) engaging in the insurance business in the state, (7) accepting an election or appointment in the state, (8) executing a bond, (9) making an application to a governmental unit for any certification, license or similar instrument, or (10) committing a violation within the state of any law or court order. 42 Pa. Cons. Stat. Ann. § 5322(a)(1)-(10).
The United States Supreme Court and the Pennsylvania Supreme Court have recognized that "the analysis of whether a state may exercise jurisdiction over a non-resident individual must be tested against both statutory and constitutional standards." Kenny v. Alexson Equip. Co., 495 Pa. 107, 432 A.2d 974, 980 (1981) (citing McGee v. International Life Ins. Co., 355 U.S. 220, 78 S. Ct. 199, 2 L. Ed. 2d 223 (1957)). Under Pennsylvania law, however, a court may exercise personal jurisdiction to the fullest extent allowed by the United States Constitution. 42 Pa. Cons. Stat. Ann. §§ 5308, 5322(b). Because there is a conflation of the statutory and constitutional inquiries, Pennsylvania jurisdictional law requires only a single step analysis, i.e., whether the court's assertion of jurisdiction complies with the constitutional requirement of due process as articulated in the personal jurisdiction context. See Clark v. Matsushita Elec. Indus. Co., 811 F. Supp. 1061, 1064 (M.D. Pa. 1993).
The Supreme Court has held that jurisdiction is proper when a defendant purposefully establishes "minimum contacts" in the forum state, by deliberately engaging in significant activities or by creating continuing obligations such that he has "availed himself of the privilege of conducting business there." Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475-76, 105 S. Ct. 2174, 2184, 85 L. Ed. 2d 528 (1985). These acts must be "such that [a defendant] should reasonably anticipate being haled into court [in the forum State]." World-Wide Volkswagen v. Woodson, 444 U.S. 286, 297, 100 S. Ct. 559, 567, 62 L. Ed. 2d 490 (1980). Further, the court's exercise of jurisdiction must comport with "traditional notions of fair play and substantial justice." Milliken v. Meyer, 311 U.S. 457, 463, 61 S. Ct. 339, 343, 85 L. Ed. 278 (1940). When ascertaining whether personal jurisdiction exists, courts must resolve the question based on the circumstances that the particular case presents. Burger King, 471 U.S. at 485, 105 S. Ct. at 2189.
In this case, plaintiffs do not argue that the Court has general jurisdiction over BAT but rather they argue that the Court has specific jurisdiction over BAT due to BAT's contacts with Pennsylvania. In advancing their argument, plaintiffs essentially attempt to demonstrate that BAT has sufficient minimum contacts with Pennsylvania based on (1) BAT's contacts with Pennsylvania and (2) the contacts of its subsidiary, B&W, with Pennsylvania. The Court will first address whether BAT itself possesses the necessary "minimum contacts" with Pennsylvania that would permit this Court to exercise specific personal jurisdiction over it.
The "minimum contacts" prong, for specific jurisdiction purposes, is satisfied by actions, or even a single act, by which the nonresident defendant "purposefully avails itself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws." See Burger King Corp., 471 U.S. at 475, 105 S. Ct. at 2183. The defendant's purposeful availment must be such that it "should reasonably anticipate being haled into court" in the forum state. World-Wide Volkswagen, 444 U.S. at 297, 100 S. Ct. at 567.
Plaintiffs have failed to allege any facts that would indicate that BAT has even one contact with Pennsylvania. BAT has submitted the affidavit of David Wilson, the Company Secretary of BAT. As evidenced by the Wilson Affidavit, BAT has done nothing which could be deemed "purposeful availment" of the benefits of doing business in the Pennsylvania. BAT is an overseas public limited company incorporated under the laws of England and Wales. (Wilson Aff. P 2). BAT "is a holding company that has never manufactured, marketed, packaged, sold, distributed or advertised tobacco products, or any other goods or products, in the State of Pennsylvania or elsewhere." (Wilson Aff. P 3). BAT is not licensed nor qualified to conduct business in Pennsylvania and has never transacted any business within Pennsylvania and maintains no officer, agent, distributor, servant, employee, broker, wholesaler or other representative within Pennsylvania. (Wilson Aff. PP 6-7). BAT also does not own, lease or possess real or personal property in the state. Further BAT maintains no bank accounts, pays no taxes, receives no mail, has not entered into contracts, and has no agent for service of process in Pennsylvania. (Wilson Aff. PP 9-11, 13). BAT's officers, employees, records and office are located in the United Kingdom. In sum, the Court finds that BAT itself does not have one contact with Pennsylvania.
Plaintiffs claim that BAT is directly involved in tobacco research and has established minimum contacts with Pennsylvania through such tobacco research. This claim is not supported by the evidence of record. For example, plaintiffs point to the August 1996 Report of the United States Food & Drug Administration as evidencing BAT's involvement in research. A close review of that document, however, provides no support for plaintiffs' allegations and demonstrates that is was B&W and BATCo, and not BAT, that performed the research referred to throughout the report. In addition, many of the documents make reference to the involvement of "BAT" in tobacco research without specifying whether the reference is to BAT, BATCo or B&W. These documents simply provide no support for plaintiffs' position. Plaintiffs provide no further documentary ...