The opinion of the court was delivered by: Katz, Senior District Judge.
The plaintiff, Visual Security Concepts, Inc. (VSC), has sued
several defendants for patent infringement related to the
manufacture of a clear-cabinet television set used in
correctional institutions. The present motion to dismiss
submitted by defendant Korea Electronics Company, Ltd. (KEC),
contends, inter alia, that it is not subject to personal
jurisdiction in this court. Because the plaintiff has not met its
burden of showing that KEC has the necessary minimum contacts
with this forum, the motion will be granted. The court does not
reach the other grounds for dismissal raised by the defendant.
A federal court may exercise personal jurisdiction over a
non-resident defendant to the extent permitted under applicable
state law, see Fed.R.Civ.P. 4(e), and Pennsylvania authorizes
long-arm jurisdiction to the extent permitted by the due process
clause. See 42 Pa.C.S. § 5322(b).*fn1 Once jurisdiction has
been challenged, the plaintiff "bears the burden of establishing
either that the cause of action arose from the defendant's
forum-related activities (specific jurisdiction) or that the
defendant has continuous and systematic contacts with the forum
state (general jurisdiction)." Mellon Bank (East) v. DiVeronica
Bros., 983 F.2d 551, 554 (3d Cir. 1993) (citations, punctuation
omitted). In most cases, the plaintiff's jurisdictional
allegations must be supported by appropriate affidavits or
documents, as a motion brought pursuant to Federal Rule of Civil
Procedure 12(b)(2) requires resolution of factual issues. See
TJS Brokerage & Co., Inc. v. Mahoney, 940 F. Supp. 784, 787
The plaintiff may meet its burden and present a prima facie
case for exercising personal jurisdiction by "establishing with
reasonable particularity sufficient contacts between the
defendant and the forum state." Mellon Bank (East) PSFS v.
Farino, 960 F.2d 1217, 1223 (3d Cir. 1992) (citations omitted).
Jurisdiction is proper only if the defendant has constitutionally
sufficient "minimum contacts" that indicate that it has
"purposefully directed" its activities toward the forum. Burger
King Corp. v. Rudzewicz, 471 U.S. 462, 472, 474, 105 S.Ct. 2174,
85 L.Ed.2d 528 (1985). In other words, fortuitous contacts
are inadequate, as the minimum contacts must be "such that [a
defendant] should reasonably anticipate being haled into court"
in the forum. World-Wide Volkswagen Corp. v. Woodson,
444 U.S. 286, 297, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980). As is
particularly important in this case, "with regard to producers or
sellers of goods, the mere foreseeability that a product one
sells may end up in the forum state does not render the seller
amenable to suit in the forum state." Pennzoil Prods. Co. v.
Colelli & Assoc., Inc., 149 F.3d 197, 203 (3d Cir. 1998)
(citations, punctuation omitted). Furthermore, even if minimum
contacts are demonstrated, the court may exercise personal
jurisdiction only if doing so would comport with "traditional
notions of fair play and substantial justice." International
Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90
L.Ed. 95 (1945).
KEC is a Korean corporation with its principal place of
business in Korea. See Am.Compl. ¶ 3; Jae Hoon Lee Aff. (1) ¶
4.*fn2 It manufactures electronics products and components,
including television sets, that are exported to numerous
countries, including the United States. See Lee Aff. (1) ¶ 4.
KEC is not licensed to do business in Pennsylvania and has no
office, property, telephone, mailing address, sales agent or
representative, agent for service of process, or bank accounts in
Pennsylvania. See id. ¶ 3. Nor does it advertise in
Pennsylvania. See id.
While KEC admits that it manufactures clear televisions, it
does so only for KTV, Inc., one of the other defendants, and only
to meet KTV's specifications. See id. ¶ 4; see also Jong Hyun
Kim Dep. at 45, 51. KEC describes KTV as its "distributor." Lee
Aff. (1) ¶ 4. KTV, in turn, is a New Jersey corporation. See
id. ¶ 5. KEC owns fifty percent of KTV's outstanding stock while
another unrelated Korean corporation, Kolon Company, owns the
other fifty percent. See Lee Aff. (2) ¶ 4; see also Lee Aff.
(1) ¶ 5 (stating that KEC's ownership interest in KTV is not a
"majority or controlling interest"); Kim Dep. at 14 (explaining
that one other entity has ownership interest and that KEC does
not "own" KTV); Sung Soo Park Dep.*fn3 at 6, 12-13 (stating that
he believes that "KEC supplies some materials" to KTV and that
KEC does not own KTV).
KEC itself has never sold or delivered any television sets of
any type to Pennsylvania and has not itself shipped televisions
to or through Pennsylvania. All KEC televisions sold in the
United States are "shipped by Korea Electronics Co., Ltd. F.O.B.
Korea, to KTV, Inc." Lee Aff. (1) ¶ 6. KEC does not have input
into KTV's sales or marketing decisions but rather fills orders
placed by that company. See Lee Aff. (2) ¶¶ 5, 7; Kim Aff. ¶ 2
(KTV is an "independent company and makes all financial, pricing,
purchasing, sales, and marketing decisions internally and
independently of Korea Electronics"). KTV has no authority to act
on KEC's behalf and has no power to bind KEC. See Kim Aff. ¶ 3.
KEC is not paying any part of KTV's attorneys' fees in this
matter because "this is KTV's problem, so KTV pays all the
expenses." Kim Dep. at 51.
KTV has only seven employees, see Kim Aff. ¶ 7, and KTV and
KEC share one employee, Mr. Kim. See Lee Aff. (2) ¶ 10; Park
Dep. at 14; Kyung Shim Dep.*fn4 at 8-9. Mr. Kim is the president
of KTV and a non-voting director of KEC. See Lee Aff.
(2) ¶ 2; Kim Aff. ¶ 1. He began working for KEC only upon his
return to Korea from New Jersey in 1998, see Lee Aff. (2) ¶ 2,
and he clearly treats his obligations to the two companies
separately. The compartmentalization of his duties is apparent in
the manner by which he is compensated by the two companies: KTV
continued to pay his KTV-related "expenses and benefits" after
Mr. Kim returned to Korea, but KEC paid his salary. See Lee
Aff. (2) ¶ 3; see also Park Dep. at 22 (stating that KTV pays
Mr. Kim's KTV expenses while he is in the United States). One
additional KTV employee, Jin Jang, who works in sales, previously
worked for KEC. See Kim Aff. ¶ 7; Jin Jang Dep. at 8-9. KEC
arranged for him to come to the United States and to work for
KTV, but after he arrived, his salary was paid only by KTV. See
Jang Dep. at 8-10. Mr. Jang clearly distinguishes between his
past career at KEC and his present employment at KTV. See id.
at 9-12, 22, 24.*fn5
There is currently no evidence suggesting that any clear
television sets were sold in Pennsylvania, and Mr. Lee states
that he is unaware of any sets ever having been sold in
Pennsylvania. See Lee Aff. (1) ¶ 6. Plaintiff's only
information on this subject consists of rather cryptic references
in redacted documents. See Plf. Ex. E. The first of these
documents is a December 12, 1997, fax from the "Visual Product
Division" of KEC to Mr. Kim and copied to Mr. Jang at KTV. The
second page of this fax contains a header entitled "Prison
Market, Access." The text, which is in English, describes the
author's belief that there is a growing demand by state prison
systems for a clear cabinet television. The writer asks KEC to
prepare several samples quickly. Mr. Kim explains that this was
faxed to him in his capacity as president of KTV before he began
working for KEC. See Kim Aff. ¶ 8.
The next three documents contain redacted minutes of meetings
held, respectively, on April 7, 1998; February 2, 1998; and
January 12, 1998. Each contains a heading referring to prisons
and a subheading referring to American Institutional, which is
also a named defendant. These notes state, respectively: (1)
"Pennsylvania is delaying the mandate for a clear set because of
the higher price involved."; (2) "Teddy informs me that there was
a general meeting of 27 Pennsylvania DOC managers at which the
13CLR was discussed and recommended."; and (3) "American
Institutional has visited all of the Pennsylvania facilities and
received uniformly positive responses." There is no information
as to who attended the meeting, although the parties seem to
agree that a KTV employee, Jay Bergen, wrote the notes. Mr. Lee
Korea Electronics does not have in its files the
memoranda or notes attached to [plaintiff's]
documents entitled "meetings." Korea Electronics
never received such things from KTV other than
purchase orders. The "internal memorandum" referred
to in the opposition memo is not an internal memo
between KTV and Korea Electronics. Korea Electronics
does not and did not have any meetings with KTV
regarding sales, marketing or anything else
referenced in the documents. If these notes relate to
meetings, they are not meetings that Korea
Electronics attended, knew of, or otherwise had
anything to do with in any way.
Lee Aff. (2) ¶ 9. Mr. Kim acknowledges the possibility that he
might have received those notes but comments that each of the
items are dated before he was hired at KEC and that he would not
have informed KEC of any of the information in those notes. See
Kim Aff. ¶ 6; see also Kim. Dep. at 39-41 (stating ...