Andersen v. Sportmart, Inc., 2:94 CV 0136AS.

• Decision Date: 14 July 1999
• Docket Number: No. 2:94 CV 0136AS.,2:94 CV 0136AS.
• Citation: 57 F.Supp.2d 651
• Parties: Amanda ANDERSEN, b/n/f Kenneth Andersen, Kenneth Andersen and Linda Andersen Plaintiffs, v. SPORTMART, INC., Wilson Sporting Goods Co., General Sportcraft Co. Ltd., Foremost Sports Co., a Division of General Sportcraft Co.,and A & O Rubber Plastics Defendants. Sportmart, Inc., Wilson Sporting Goods Co., Foremost Sports Co., and General Sportcraft Co., Ltd., Cross-Plaintiffs, v. A & O Rubber & Plastic Ind. Co., Ltd., d/b/a Hung Yeh Rubber & Plastic Co., Ltd. Cross-Defendant. Sportmart, Inc., Wilson Sporting Goods Co., Foremost Sports Co., and General Sportcraft Co., Ltd., Third Party Plaintiffs, v. Taiwan Daido, Ltd., Tung Chin Industrial Store, Hung Wang, Hung Wen-Ming, and Hung Ming-Pen Third Party Defendants.
• Court: U.S. District Court — Northern District of Indiana

Page 651

57 F.Supp.2d 651

Amanda ANDERSEN, b/n/f Kenneth Andersen, Kenneth Andersen and Linda Andersen Plaintiffs, v. SPORTMART, INC., Wilson Sporting Goods Co., General Sportcraft Co. Ltd., Foremost Sports Co., a Division of General Sportcraft Co.,and A & O Rubber Plastics Defendants.

Sportmart, Inc., Wilson Sporting Goods Co., Foremost Sports Co., and General Sportcraft Co., Ltd., Cross-Plaintiffs, v. A & O Rubber & Plastic Ind. Co., Ltd., d/b/a Hung Yeh Rubber & Plastic Co., Ltd. Cross-Defendant.

Sportmart, Inc., Wilson Sporting Goods Co., Foremost Sports Co., and General Sportcraft Co., Ltd., Third Party Plaintiffs, v. Taiwan Daido, Ltd., Tung Chin Industrial Store, Hung Wang, Hung Wen-Ming, and Hung Ming-Pen Third Party Defendants.

No. 2:94 CV 0136AS.

United States District Court, N.D. Indiana, Fort Wayne Division.

July 14, 1999.

COPYRIGHT MATERIAL OMITTED

David C. Bohrer, Kathryn C. Thomas, Oppenheimer Wolff and Donnelly, Chicago, IL, for Sportmart Inc., Wilson Sporting Goods Co., Inc., General Sportcraft Co., Ltd., Inc., Foremost Sport Co., Sportman Inc.

Douglas K. Dieterly, James M. Lewis, Barnes and Thornburg, South Bend, IN, Mark A. Garvin, Barnes and Thornburg, Fort Wayne, IN, Charles Ya-Wen Chiu, for Taiwan Daido, Ltd.

MEMORANDUM OF DECISION AND ORDER

WILLIAM C. LEE, Chief Judge.

In July, 1992, plaintiff, Amanda Andersen, suffered a severe eye injury while playing in her backyard with an allegedly defective batting tee. The injury spawned the present lawsuit wherein Andersen and her parents sued the distributors, sellers¹, and manufacturer² of the batting tee under negligence, products liability, and breach of warranty theories. Seeking contribution and indemnification, Defendants General Sportcraft, Sportmart, Wilson, and Foremost (collectively referenced herein as "Sportcraft") filed their cross-complaint against manufacturer, A & O Rubber³ and a third-party complaint against Taiwan Daido, Ltd. ("Daido"), the Taiwanese buying agent for Sportcraft. In April, 1998, after reaching settlement with Sportcraft, plaintiffs dismissed their lawsuit without prejudice to Sportcraft's pending cross-claim and third party claims for contribution. These are the sole claims pending in this action.

Presently before the court is Daido's Motion to Dismiss for Lack of Personal Jurisdiction, filed on April 1, 1998. This filing triggered Sportcraft's Motion for Leave to Conduct Discovery on the Limited Issue of Personal Jurisdiction. In a published order dated, May 5, 1998, Magistrate Judge Roger Cosbey granted Sportcraft's motion.⁴ As a result of that order, Sportcraft deposed Daido's President, Toru Tsukagoshi and requested additional discovery in the form of interrogatories and requests for production of documents. More than a year later, on June 11, 1999, Sportcraft tendered its "Opposition to Taiwan Daido's Motion to Dismiss for Lack of Personal Jurisdiction or, in the alternative, Motion to Transfer Venue Pursuant to 28 U.S.C. § 1406(a)." Daido replied on June 25, 1999.

For the following reasons, the motion to dismiss is DENIED and this case shall be TRANSFERRED to the United States District Court for the District of New Jersey.

APPLICABLE STANDARD AND FACTUAL BACKGROUND

On a motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(2), the plaintiff has the burden to make a prima facie showing that personal jurisdiction exists. See Neuman v. Florabelle Flowers, Inc., 15 F.3d 721, 724 (7th Cir.1994).⁵ A plaintiff satisfies this prima facie requirement by presenting evidence of specific facts that, when taken as true, are sufficient to support a finding of personal jurisdiction. Sheridan v. Ascutney Mountain Resort Services, Inc., 925 F.Supp. 872 (D.C.Mass. 1996) ("a prima facie showing of personal jurisdiction must be based on evidence of specific facts set forth in the record; the plaintiff must go beyond the pleadings and make affirmative proof."); see also Cable/Home Communication Corp. v. Network Prods., Inc., 902 F.2d 829, 855 (11th Cir.1990) (plaintiff must make a prima facie showing that jurisdiction exists by presenting enough evidence to withstand a motion for a directed verdict). When deciding whether plaintiff has made the necessary showing, a court is not limited to the pleadings but may consider affidavits, interrogatories, depositions, oral testimony or any combination of the recognized methods of discovery. Turnock v. Cope, 816 F.2d 332, 333 (7th Cir.1987); Jobe v. ATR Marketing, Inc., 87 F.3d 751 (5th Cir.1996). At this stage, all factual disputes are resolved in the plaintiff's favor. See Turnock, 816 F.2d at 333. Applying these standards, the straightforward and relatively uncomplicated facts are:

Daido is an independently run Taiwanese corporation with its principal place of business in Taipei, Taiwan. (Tsukagoshi Aff. ¶¶ 3, 4). Daido employs eight employees, all of which reside in Taiwan or nearby Asian countries. (Tsukagoshi Aff. ¶ 20). Daido's business involves acting as a regional purchasing agent for companies outside of Asia which seek to purchase goods manufactured in Asia. (Tsukagoshi Aff. ¶ 5). As a purchasing agent, Daido places orders for goods on behalf of its clients with Asian companies, monitors the production schedule, inspects the finished order for shipping, and arranges the shipping.⁶ (Tsukagoshi Dep. p. 69) All of Daido's business is conducted within the Taiwanese border.

Daido does not maintain or lease any offices, facilities, places of business or property in Indiana (Tsukagoshi Aff. ¶¶ 12, 13); has no employees or agents in Indiana (Tsukagoshi Aff. ¶¶ 10, 11); has never directly sold any product in Indiana or advertised, designed or selected any product specifically for use in Indiana (Tsukagoshi Aff. ¶¶ 14, 15); and has never maintained any business relationships with any Indiana corporation (Tsukagoshi Aff. ¶ 16).

Operating as a purchasing agent for General Sportcraft in 1991 and 1992,⁷ Daido arranged sales of certain products, including batting tees, manufactured by A & O Rubber to General Sportcraft. These batting tees are the same type and model which allegedly caused Amanda Andersen's injury. According to Tsukagoshi, upon A & O Rubber's completion of the order, he shipped the batting tees to General Sportcraft at a New Jersey address. (Tsukagoshi Dep. p. 70). Although Tsukagoshi shipped the batting tees to New Jersey, Tsukagoshi testified that he "didn't believe that everything was sold in New Jersey." (Tsukagoshi Dep. p. 76-77).

In addition to this belief, there are some facts which suggest that Daido knew that Sportcraft distributed the products it received from Daido throughout the United States. In November, 1992, Tsukagoshi authored a letter which indicates that he had some knowledge that Sportcraft's retailers included K-Mart, Wal-Mart, and Venture, Inc. In 1993, Tsukagoshi received a fax from Sportcraft informing Tsukagoshi that a Sportcraft employee saw a particular game Daido had distributed in a Troy, Michigan K-Mart. Also in 1993, Tsukagoshi met with K-Mart representatives in K-Mart's Taipei office to discuss the design of certain products which would be shipped to Sportcraft for sale in K-Mart. Finally, while visiting the United States, Tsukagoshi stated that he saw some of the products he had shipped to Sportcraft in a K-Mart store. Tsukagoshi could not recall the date, time, or location of this K-Mart store.

With these facts set forth, the court turns to the parties' arguments.

A. Personal Jurisdiction

A federal court must obtain personal jurisdiction over a third-party defendant before it proceeds to adjudicate a third-party claim. Nortown Steel Supply Co. v. Northern Indiana Steel Supply Co., 315 F.2d 789 (7th Cir.1963). Federal courts sitting in diversity cases may exercise personal jurisdiction over a nonresident defendant only if a court in the state in which the district court sits would have such jurisdiction. NUCOR Corp. v. Aceros Y Maquilas de Occidente, S.A. de C.V., 28 F.3d 572, 580 (7th Cir.1994); Wilson v. Humphreys (Cayman) Limited, 916 F.2d 1239, 1243 (7th Cir.1990), cert. denied, 499 U.S. 947, 111 S.Ct. 1415, 113 L.Ed.2d 468 (1991). Thus, this court has jurisdiction only if Indiana confers jurisdiction through its long-arm statute.

Traditionally, the Seventh Circuit employs a two part inquiry to determine whether personal jurisdiction exists. Wilson, 916 F.2d at 1243. First, using the state's long-arm statute, the court determines whether the state statute permits jurisdiction. Id. If not, the inquiry ends. Id. If the state statute permits jurisdiction, the court engages in a second inquiry to determine whether the assertion of jurisdiction complies with constitutional due process standards. Id.

In Indiana, the long-arm statute, embodied in Trial Rule 4.4, extends the personal jurisdiction of federal courts to the limit allowed under the due process clause of the fourteenth amendment. Wallace v. Herron, 778 F.2d 391, 393 (7th Cir.1985). Accordingly, because Indiana's long-arm statute extends itself within the full reach of the due process clause, compliance with the dual inquiries expressed in Wilson is achieved by a single inquiry of whether the exercise of personal jurisdiction comports with due process. Wilson, 916 F.2d at 1243; Dehmlow v. Austin Fireworks, 963 F.2d 941, 944 (7th Cir.1992) ("The first inquiry is wholly unnecessary in the case of many modern state statutes which include catch-all provisions that grant to state courts jurisdiction over all matters in which the state may constitutionally assert jurisdiction.")

Due process requires a nonresident defendant to have "certain minimum contacts with [the forum] such that the maintenance of the suit does not offend `traditional notions of fair play and substantial justice.'" International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945). Indeed, in this case, Daido's conduct and connection with Indiana must be such that it ...