Ben & Jerry's Homemade, Inc. v. CORONET PRISCILLA ICE CR.

• Decision Date: 09 January 1996
• Docket Number: No. 2:95-CV-23.,2:95-CV-23.
• Court: U.S. District Court — District of Vermont
• Parties: BEN & JERRY'S HOMEMADE, INC., Plaintiff, v. CORONET PRISCILLA ICE CREAM CORP., Defendant.

921 F. Supp. 1206

BEN & JERRY'S HOMEMADE, INC., Plaintiff, v. CORONET PRISCILLA ICE CREAM CORP., Defendant.

No. 2:95-CV-23.

United States District Court, D. Vermont.

January 9, 1996.

Robert S. DiPalma, Paul, Frank & Collins, Inc., Burlington, VT, Douglas H. Meal, David R. Suny, Ropes & Gray, Boston, MA, for Ben and Jerry's Homemade, Inc. Richard C. Carroll, Kristensen, Cummings, Murtha & Stewart, P.C., Brattleboro, VT, for Coronet Priscilla Ice Cream Corp.

OPINION AND ORDER

SESSIONS, District Judge.

This matter is before the Court on cross-motions by the Plaintiff and Defendant. Defendant has filed a Motion to Dismiss for lack of personal jurisdiction, pursuant to Fed. R.Civ.P. 12(b)(2). Plaintiff opposes this motion. Plaintiff has filed a Motion for Summary Judgment, in accordance with Fed. R.Civ.P. 56(c). Defendant has filed opposition to this motion. Affidavits and supporting documents have been attached to the motions.

I. Factual Background

This is a diversity action based on a breach of contract claim. Plaintiff, Ben & Jerry's Homemade, Inc., ("Ben & Jerry's Homemade") is a corporation organized under the laws of the state of Vermont and has its principal place of business in Waterbury, Vermont. Defendant, Coronet Priscilla Ice Cream Corp., ("Coronet") is a New York corporation that has its principal place of business in Hicksville, New York. Plaintiff claims that it sold ice cream to Defendant, for which Defendant has refused to pay.

The following facts are not in dispute. Coronet distributes ice cream products and frozen foods in the New York metropolitan area. It began distributing Ben & Jerry's ice cream when it acquired the Ice Cream Man, Inc., a New York corporation. At that time, Coronet purchased Ben & Jerry's ice cream from Edy's Gourmet Ice Cream, Inc., ("Edy's"), another New York corporation. In February of 1994, Ben & Jerry's of New York, Inc., ("Ben & Jerry's of New York"), replaced Edy's as the exclusive distributor of Ben & Jerry's products in the metropolitan New York area for the class of trade "less than three cash registers." Ben & Jerry's of New York is a corporation organized under the laws of the state of New York with offices in Long Island City, New York. Coronet is a sub-distributor serving the less than three cash register class of trade.

On September 22, 1994, Coronet received a shipment of $61,268.12 worth of ice cream. Coronet was given a credit of $2,268.22 so that there was an outstanding balance of $58,999.90 for the ice cream. The shipment was sent F.O.B. Waterbury, Vermont from Ben & Jerry's Homemade. Coronet initially sent a check to Ben & Jerry's of New York for $58,999.90 to pay for the ice cream. Subsequently, Coronet stopped payment on the check. Shortly thereafter, the distributorship arrangement ended. On January 19, 1995, Ben & Jerry's Homemade filed suit against Coronet for failing to pay for the ice cream.

The remaining facts are in dispute. Coronet alleges that it has never entered into a contract with Ben & Jerry's Homemade. Instead, it has dealt with Ben & Jerry's of New York, a separate legal entity. Coronet maintains that it had a distributorship agreement with Ben & Jerry's of New York, with whom it placed all orders, including the shipment in question. As a sub-distributor for Ben & Jerry's of New York, Coronet worked with its Distribution Manager, Steven Cooperman.

Coronet's contact with Ben & Jerry's Homemade purportedly has been very limited. According to Coronet, it has never made a payment for Ben & Jerry's products to Ben & Jerry's Homemade. Rather, it has sent all payments to Ben & Jerry's of New York in Long Island City, New York. Although the President of Coronet, Steven Levine, has met Jerry Greenfield, co-founder of Ben & Jerry's Homemade, in New York on occasion and has had several telephone conversations with Mr. Greenfield and Thomas D'Urso, the Manager of Treasury Operations for Ben & Jerry's Homemade, Coronet avers that it has not "reached out" to do business in Vermont or engaged in a business relationship with Ben & Jerry's Homemade. Aff. of Steven Levine ¶ 14 ("Levine Aff.") (paper # 14).

Ben & Jerry's Homemade asserts that Coronet has contracted to purchase this shipment of ice cream, a full truckload, directly from Ben & Jerry's Homemade. Although some sales were made by Ben & Jerry's of New York to Coronet, whenever Coronet needed a full truckload of ice cream, it purchased it from Ben & Jerry's Homemade. Supp.Aff. of Thomas D'Urso ¶ 7 ("D'Urso Supp.Aff.") (paper # 17). Mr. D'Urso asserts that the content of his telephone conversations with Mr. Levine included, among other things, a discussion of payment, shipment and credit terms. D'Urso Supp.Aff. ¶ 8. Ben & Jerry's Homemade submits a bill of lading and an invoice, both printed on letterhead of Ben & Jerry's of Vermont, as evidence of its contention that full truckloads of ice cream, including this one, were sent pursuant to an agreement between it and Coronet. See Exh. A attached to Aff. of Thomas D'Urso ("D'Urso Aff.") (paper # 6) and Exh. A attached to D'Urso Supp.Aff. The invoice indicates that payment should be remitted to Ben & Jerry's Homemade, Inc. It also notes a credit of $2,268.22. However, it shows Steven Cooperman, of Ben & Jerry's of New York, as the salesperson for the shipment. Coronet does not contest the genuineness of the bill of lading or the invoice.

For the reasons discussed below, the parties' respective motions are denied. The Court shall address each motion seriatim.

II. Discussion

A. Personal Jurisdiction

In considering a motion to dismiss on jurisdictional grounds, the Court must take all allegations in the light most favorable to the plaintiff. Hoffritz for Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55, 57 (2d Cir.1985). However, the plaintiff "bears the burden of demonstrating contacts with the forum state sufficient to give the court jurisdiction over the person of the defendant." Sollinger v. Nasco Intern., Inc., 655 F.Supp. 1385, 1386 (D.Vt.1987). When there has been limited discovery and when the motion is being decided without an evidentiary hearing, as here, the plaintiff need make only a prima facie showing of jurisdiction, through its own affidavits and supporting materials. Marine Midland Bank, N.A. v. Miller, 664 F.2d 899, 904 (2d Cir.1981). Having set forth the appropriate standard for assessing the motion to dismiss, the Court now turns to the merits.

Personal jurisdiction over a nonresident defendant in a diversity action is determined on the basis of Vermont law, which invokes a two part analysis. See Arrowsmith v. United Press International, 320 F.2d 219, 231 (2d Cir.1963); Braman v. Mary Hitchcock Memorial Hospital, 631 F.2d 6, 7-8 (2d Cir.1980); Northern Aircraft, Inc. v. Reed, 154 Vt. 36, 40, 572 A.2d 1382 (1990). First, the Court must find that Vermont's long arm statute reaches the defendant. Second, it must determine that the exercise of the state's long arm statute does not offend due process. Northern Aircraft, 154 Vt. at 40, 572 A.2d 1382; see also Sollinger, 655 F.Supp. at 1387. Defendant was served pursuant to V.R.C.P. 4(e) and 12 V.S.A. § 913(b), the relevant Vermont long arm statute. Title 12 V.S.A. § 913(b) provides:

Upon the service on a party outside the state, and if it appears that the contact with the state or by the party or the activity in the state by the party or the contact or activity imputable to him is sufficient to support a personal judgment against him, the same proceedings may be had for a personal judgment against him as if the process or pleading had been served on him in the state.

Interpreting this section, the Vermont Supreme Court has held that an exercise of jurisdiction over an out-of-state defendant is proper if it comports with the due process clause. Northern Aircraft, 154 Vt. at 40, 572 A.2d 1382. Accordingly, the first part of the analysis merges into the second. Thus, the Court can proceed to an application of the due process clause.

The purpose of the due process clause is to ensure that a nonresident defendant is not subject to the binding judgments of a forum with which it has had no significant contacts. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 471-72, 105 S.Ct. 2174, 2181-82, 85 L.Ed.2d 528 (1985). To satisfy due process a nonresident defendant must have established minimum contacts with the forum state such that the defendant "should reasonably anticipate being haled into court there." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 567, 62 L.Ed.2d 490 (1980). A defendant should "reasonably anticipate" out-of-state litigation when it "purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws." Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1240, 2 L.Ed.2d 1283 (1958).

Arguing that its contact with Vermont has been fortuitous, attenuated and random, Defendant claims that it does not have the requisite minimum contacts with Vermont to sustain jurisdiction. Defendant does not have a Vermont office, it has no sales in Vermont, and it has never visited the state. Nonetheless, for purposes of deciding the instant matter, the Court must review the evidence in the light most favorable to the Plaintiff. Taken together, Plaintiff's claim that Defendant purchased the shipment in question from it, Mr. D'Urso's statement that he spoke with the Defendant's President about shipment, payment and credit terms, the invoice indicating that payment is to be remitted to Ben & Jerry's Homemade, and the uncontroverted evidence that Plaintiff sent the shipment F.O.B. Waterbury, Vermont establish contacts sufficient to invoke specific jurisdiction.¹

Intentional and affirmative action by the nonresident defendant in the forum state is the key to personal jurisdiction. Pasquale v. Genovese, 136 Vt. 417, 421, 392 A.2d 395 (1978). According to Plaintiff, Defendant has...