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Cintron Beverage Group, Llp v. Nemr Aoun D/B/A Garden Beverages

July 26, 2011

CINTRON BEVERAGE GROUP, LLP,
PLAINTIFFS
v.
NEMR AOUN D/B/A GARDEN BEVERAGES, ET AL., DEFENDANTS



The opinion of the court was delivered by: Rufe, J.

MEMORANDUM OPINION AND ORDER

Plaintiff Cintron Beverage Group LLC ("Cintron") and movant Garden Food Distributor, Inc ("GFDI") entered into an oral distribution agreement under which GFDI would distribute beverages produced by Cintron. For approximately two years, Cintron sent beverage products to GFDI, and GFDI distributed those products in Michigan, Illinois and Ohio. GFDI remitted payment to Cintron's Philadelphia headquarters. When the Defendants failed to make payments owed, Cintron brought this action for breach of contract and unjust enrichment. Now before the Court is GFDI's Motion to Dismiss pursuant to Federal Rule of Civil Procedure 12(b)(2), asserting lack of personal jurisdiction. *fn1 For the reasons below, the Court finds that GFDI is not subject to the jurisdiction of this Court.

FACTUAL BACKGROUND

Plaintiff Cintron is a Delaware limited liability company with its headquarters in Philadelphia, Pennsylvania. *fn2 Cintron manufactures and distributes various beverage products, including energy drinks, fruit drinks, and teas, through a world-wide network of independent distributors. *fn3 Defendant GFDI is a Michigan corporation, with its principal place of business in Dearborn, Michigan, engaged in the business of purchasing and distributing beverages in Michigan and Ohio. *fn4 GFDI has no real estate, personal property, assets, offices, employees, agents, bank accounts, business addresses or phone listings in Pennsylvania, nor does GFDI advertise, sell or distribute any product or render any services in Pennsylvania. *fn5
In 2007 or 2008, a Cintron representative contacted GFDI to inquire whether GFDI would be interested in distributing Cintron manufactured beverages in southwest Michigan and Toledo Ohio. *fn6 Cintron and GFDI entered into an oral distribution agreement, but did not reduce the contract to writing and had no agreement whereby GFDI consented to subject itself to the jurisdiction of any court in Pennsylvania. *fn7 For approximately two years, the parties maintained a business relationship in which GFDI ordered Cintron beverage products and Cintron delivered those products to GFDI in Dearborn, Michigan for resale in southeast Michigan and Toledo, Ohio. *fn8 GFDI did not request that the Cintron product it obtained come from any particular geographical location or source. *fn9

For each order delivered to GFDI, Cintron sent an invoice directing GFDI to submit payment to Cintron headquarters in Pennsylvania within 30 days of receipt. *fn10 Over two years, GFDI submitted payments to Cintron in Pennsylvania totaling approximately $303,332.24. *fn11

But, according to Cintron, GFDI ordered, received, accepted, and resold Cintron product totaling $206,650.20 without making payments, causing financial harm to Cintron in Pennsylvania. *fn12

Therefore, Cintron filed a breach of contract complaint in this Court on July 13, 2010.

On August 20, 2010, GFDI answered the complaint and asserted counterclaims, raising lack of personal jurisdiction as its first affirmative defense, and on October 18, 2010, GFDI filed a motion to dismiss for lack of in personam jurisdiction. *fn13 In support of that Motion, the president of GFDI attests that Cintron personnel and sales representatives visited the GFDI offices and sales representatives in Michigan on multiple occasions, but no employee or officer of GFDI has ever been to Pennsylvania to conduct business with Cintron. *fn14 Cintron disputes the latter averment, alleging that on July 14, 2008, GFDI sent an employee to Pennsylvania to "deliver a payment of $70,829.55, and to discuss the reconciliation of the outstanding invoices." *fn15 Cintron provides no other information about the alleged visit to Pennsylvania.

STANDARD OF REVIEW

On a motion to dismiss for lack of personal jurisdiction, a court is required to accept a plaintiff's allegations as true and construe disputed facts in favor of the plaintiff. *fn16 Once a defendant raises a jurisdictional defense, the plaintiff has the burden of proving that jurisdiction is proper by affidavits or other competent evidence. *fn17 Plaintiff need only establish a prima facie case of personal jurisdiction, *fn18 and meets this burden by stating the bases for personal jurisdiction with reasonable particularity. *fn19 "Factual disputes created by the affidavits, documents, and depositions submitted for the court's consideration are resolved in favor of the non-moving party." *fn20 Federal courts sitting in diversity may exercise personal jurisdiction over nonresident defendants to the extent provided by the law of the state in which the federal court sits. *fn21
Pennsylvania's Long-Arm Statute allows personal jurisdiction over nonresident defendants to the constitutional limits of the due process clause of the Fourteenth Amendment. *fn22 Under this standard, nonresident defendants are required to have minimum contacts with Pennsylvania so as not to offend traditional notions of fair play and substantial justice. *fn23 There are two types of personal jurisdiction: general and specific. *fn24

DISCUSSION

I. GENERAL PERSONAL ...


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