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STONER v. ARTS UNIQ

September 30, 2005.

CLAIRE STONER, Plaintiff
v.
ARTS UNIQ, INC., Defendant.



The opinion of the court was delivered by: SYLVIA RAMBO, Senior District Judge

MEMORANDUM

Before the court are Defendant's motions to dismiss, or in the alternative to transfer the case. (Doc. 6.) The parties have briefed the issues, and the matter is ripe for disposition. For the reasons that follow, Defendant's motion will be Denied.

I. Background

  Plaintiff Claire Stoner is an artist domiciled in New Freedom, Pennsylvania. (Compl. ¶ 3.) Defendant Arts Uniq, Inc., a Tennessee corporation, represents and promotes artists and artworks. (Id. ¶ 4.) Defendant represents many artists in the Commonwealth of Pennsylvania; Pennsylvania artists comprise over 10% of Defendant's client base. (Def.'s Reply Br. 4.) Defendant also enters into sales agreements with art dealers; sales to dealers in Pennsylvania comprise about two percent of Defendant's total sales. (Id.) Defendant advertises on its website that it has a business relationship with nearly 600 art dealers in Pennsylvania. (Pl.'s Br. in Opp'n 5; Doc. 15.) Plaintiff entered into an agreement with Defendant on January 30, 2003 to represent Plaintiff and her works. (Compl. ¶ 6.) Defendant advised Plaintiff that she could terminate the agreement unilaterally. (Id. ¶ 8.) On November 1, 2004, Plaintiff terminated her contractual relationship with Defendant. (Id. ¶ 7.) At that time, Plaintiff learned that Defendant had entered into long-term contracts on her behalf, and that some of these agreements ran for as much as two years past the date of termination. (Id. ¶¶ 11-20.) According to Plaintiff, she had not been informed of the length of these contracts. (Id. ¶¶ 14, 16, 18, 20.) Plaintiff asserts that Defendant continues to collect royalties on the sales of her work. (Id. ¶ 26.) Plaintiff believes that these royalties have amounted over $100,000 to date, and that they could amount to $150,000 over the life of these long-term contracts. (Id. ¶¶ 27, 30.)

  Plaintiff filed a Complaint alleging breach of contract on May 2, 2005, asking the court to enjoin the Defendant from acting as Plaintiff's agent and collecting royalties from that representation. (Id. ¶ 30.) She also seeks damages for those royalties that have been diverted to Defendant after the termination of their agreement. (Id.) Defendant filed a motion to dismiss pursuant to Rule 12(b)(2) and 12(b)(3) of the Federal Rules of Civil Procedure on August 25, 2005. In that motion, Defendant also moved for a change of venue pursuant to 28 U.S.C. § 1404.

  II. Discussion

  A. Personal Jurisdiction

  Rule 12(b)(2) of the Federal Rules of Civil Procedure allows a defendant to challenge the court's right to exercise personal jurisdiction over him. The defendant bears the initial burden of rasing a lack of jurisdiction. Carteret Sav. Bank, F.A. v. Shushan, 954 F.2d 141, 146 (3d Cir. 1992). The burden then shifts to the plaintiff to establish that the exercise of personal jurisdiction over the defendant is proper. Id. The plaintiff must "establish jurisdictional facts through sworn affidavits or other competent evidence." Time Share Vacation Club v. Atl. Resorts, 735 F.2d 61, 66 n. 9 (3d Cir. 1984). "[A]t no point may a plaintiff rely on the bare pleadings alone in order to withstand a defendant's Rule 12(b)(2) motion for lack of in personam jurisdiction." Id. The plaintiff need only make a prima facie showing of personal jurisdiction if there has been limited discovery or no evidentiary hearing.*fn1 Carteret, 954 F.2d at 142. After a prima facie case has been made, the plaintiff must still establish personal jurisdiction by a "preponderance of the evidence." Id.

  Pursuant to Rule 4(e) of the Federal Rules of Civil Procedure, a federal court may exercise personal jurisdiction over non-residents "to the extent permissible under the law of the state where the district court sits." Mellon Bank (East) PSFS v. Farino, 960 F.2d 1217, 1221 (3d Cir. 1992). Pennsylvania's long arm statute extends personal jurisdiction to the fullest extent allowed under the United States Constitution. 42 Pa. C.S.A. § 5322(b). Thus, the long-arm statute is limited only by the Due Process Clause.

  A district court may assert personal jurisdiction over a non-resident defendant when the defendant's "conduct and connection with the forum state are such that he should reasonably anticipate being haled into court there." World Wide Volkswagon Corp. v. Woodson, 444 U.S. 286, 297 (1980). Where a defendant "purposefully avails himself of the privilege of conducting activities within the forum state," the defendant is on notice that he is subject to suit in that state. Id.; Hanson v. Denkla, 357 U.S. 235, 253 (1958). This analysis centers on "whether the defendant has purposefully directed his activity toward the forum state." Burger King Corp. v. Redzewicz, 471 U.S. 462, 472 (1985).

  The court exercises specific jurisdiction over a defendant where the suit arises out of or is related to the defendant's contacts with the forum state. Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 n. 8 (1984). If the suit does not arise out of defendant's contacts with the forum state, the court may exercise general jurisdiction if the defendant's contacts are "continuous and systematic." Id. at 415-16.

  Defendant contends that because the agreement between the parties was concluded from Defendant's place of business in Tennessee, and because the agreement is governed by Tennessee law, Plaintiff cannot establish that Defendant had sufficient contact with Pennsylvania. However, Defendant admits having continual intentional contact with Pennsylvania. From at least 2003, Defendant has earned between one and two percent of its total annual sales income from Pennsylvania dealers. (Def.'s Reply Br. 4.) It has represented Pennsylvania artists during that length of time as well; over ten percent of Defendant's client base is comprised of Pennsylvania artists. (Id.) Defendant also advertises on its website that it has business relationships with nearly 600 art dealers in Pennsylvania. (Pl.'s Br. in Opp'n 5; Doc. 15.) Many of these dealers are located in the Middle District of Pennsylvania.

  Defendant has maintained continuous contact with the Commonwealth of Pennsylvania over a period of at least three years. Defendant purposefully directed his activities toward the Commonwealth by entering into business relationships with artists and art dealers in Pennsylvania. By these contacts, Defendant is on notice that it could be haled into court by any one of these artists they represent or dealers. Thus, it is not unfair to assert personal jurisdiction over Defendant here. Because the court finds that general personal jurisdiction over Defendant is proper, the court need not determine whether ...


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