Beemac, Inc. v. Steel
| Decision Date | 20 May 2021 |
| Docket Number | Civil Action No. 2:20-cv-1458 |
| Parties | BEEMAC, INC., Plaintiff, v. REPUBLIC STEEL, Defendant. |
| Court | U.S. District Court — Western District of Pennsylvania |
Hon. William S. Stickman IV
Plaintiff, Beemac, Inc. ("Beemac"), filed suit against Defendant, Republic Steel ("Republic"), in the Court of Common Pleas of Beaver County, Pennsylvania, requesting relief under various state law causes of action for Republic's alleged failure to pay Beemac for transportation and shipping services performed in 2019 and 2020. (ECF No. 1-1, ¶¶ 5-16, 23-50). Republic removed the action to this Court under 28 U.S.C. §§ 1332, 1441, and 1446 (ECF No. 1, p. 1), and subsequently filed a Motion to Dismiss for Lack of Personal Jurisdiction (ECF No. 3) under Federal Rule of Civil Procedure 12(b)(2). The parties have filed their respective positions on the issues, and for the reasons that follow, the Court will deny Republic's Motion to Dismiss for Lack of Personal Jurisdiction (ECF No. 3).
Beemac is a professional trucking and logistics company that provides services throughout North America. (ECF No. 10-1, ¶ 5). It is a Pennsylvania corporation with a principal place of business in Pennsylvania. (ECF No. 1-1, ¶ 1). Republic is a Delaware corporation and its principal place of business is in Ohio. (ECF No. 1-1, ¶ 2); (ECF No. 4-2, ¶ 3).
Throughout the years, Republic has reached out and engaged with Beemac for the transportation and shipment of products "to or from locations in several states, including Pennsylvania." Consistent with their preexisting relationship, Republic, on two separate occasions, solicited the business of Beemac in Pennsylvania. On both occasions, Republic invited Beemac to respond to its Request for Quotation, which concerned transportation service rates for various "lanes in interstate commerce designated by Republic for its business needs." Some of those lanes included areas in Pennsylvania. Each time, Beemac responded by offering its lane rates and Republic twice agreed to those rates. Thereafter, Beemac proceeded to transport shipments for Republic to, from, and through Pennsylvania, which included approximately ninety-one shipments from or to Pennsylvania for a period spanning approximately seventeen months. (ECF No. 10-1, ¶¶ 6-18). In doing so, Beemac used trucks and employees located in Pennsylvania. (ECF No. 10-1, ¶ 5). It was also standard practice for Republic to wire payments to Beemac in Pennsylvania. (ECF No. 10-1, ¶ 20).
For each shipment, Beemac constructed and sent bills of lading and invoice documents to Republic, to which Republic represented that it agreed to pay the offered rates set forth in those documents. In reliance on those representations, Beemac allegedly performed by providing transportation and shipping services to Republic. (ECF No. 10-1, ¶ 19). Republic, however, has not paid Beemac for the transportation services at issue. (ECF No. 10-1, ¶ 21). Beemac alleges that it sustained monetary damages in the amount of $2,232,811.50, and requests relief under the following common law causes of action: (1) breach of contract; (2) unjust enrichment; (3) account stated; (4) fraud in the inducement; and (5) negligent misrepresentation. (ECF No. 1-1, ¶¶ 23-50).
Federal Rule of Civil Procedure 12(b)(2) requires a court to dismiss a case when a court lacks personal jurisdiction over a defendant. Fed. R. Civ. P. 12(b)(2). A court must analyze jurisdictional contacts on a claim-by-claim basis. Miller Yacht Sales, Inc. v. Smith, 384 F.3d 93, 104 (3d Cir. 2004). Once a defendant contests the sufficiency of personal jurisdiction, the burden shifts to a plaintiff to establish personal jurisdiction O'Connor v. Sandy Lane Hotel Co., Ltd., 496 F.3d 312, 316 (3d Cir. 2007). If there is no evidentiary hearing, a plaintiff must make a prima facie case by furnishing facts that establish with reasonable particularity that personal jurisdiction exists. Provident Nat'l Bank v. Cal. Fed. Sav. & Loan Ass'n, 819 F.2d 434, 437 (3d Cir. 1987) (citation omitted). If a court holds an evidentiary hearing, the standard of proof elevates to a preponderance of the evidence standard. LaRose v. Sponco Mfg., Inc., 712 F. Supp. 455, 458-59 (D.N.J. 1989) (citing Marine Midland Bank, N.A. v. Miller, 664 F.2d 899, 904 (2d Cir. 1981)). See also Hufnagel v. Ciamacco, 281 F.R.D. 238, 244 (W.D. Pa. 2012) (citing cases). If a plaintiff meets his burden, the burden shifts back to the defendant to present a compelling case that personal jurisdiction is unreasonable. Carteret Sav. Bank, FA v. Shushan, 954 F.2d 141, 150 (3d Cir. 1992) (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477 (1985)).
A plaintiff's case cannot merely rely on the pleadings but must be supported by sworn affidavits or other competent evidence. Time Share Vacation Club v. Atl. Resorts, Ltd., 735 F.2d 61, 66 n.9 (3d Cir. 1984). All allegations made by a plaintiff are accepted as true and all disputed facts are construed in the plaintiff's favor. Carteret, 954 F.2d at 142 n.1. To that end, any conflicts between the evidence submitted by a plaintiff and a defendant are construed in a plaintiff's favor. In re Enter. Rent-A-Car Wage & Hour Empl.'t Practices Litig., 735 F. Supp. 2d 277, 307 (W.D. Pa. 2010). If a plaintiff initially fails to meet his burden but makes factual allegations suggestingthat the requisite contacts exist, a court can order jurisdictional discovery to ameliorate the jurisdictional inquiry. Toys "R" Us, Inc. v. Step Two, S.A., 318 F.3d 446, 456 (3d Cir. 2003).
Republic requests that the Court dismiss this case on the ground that it lacks personal jurisdiction over Republic because neither general nor specific personal jurisdiction are applicable. (ECF No. 4, pp. 3-7). Beemac does not argue that general jurisdiction is present, but rather it contends that the Court has specific personal jurisdiction over Republic because it purposefully directed its conduct to the forum, the claims arose out of or relate to that conduct, and the exercise of jurisdiction would be consistent with traditional notions of fair play and substantial justice.1 (ECF No. 10, pp. 6-14).
"Federal courts ordinarily follow state law in determining the bounds of their jurisdiction over persons." Walden v. Fiore, 571 U.S. 277, 283 (2014) (quoting Daimler AG v. Bauman, 571 U.S. 117, 125 (2014)) (internal quotation marks omitted). "This is because a federal district court's authority to assert personal jurisdiction in most cases is linked to service of process on a defendant 'who is subject to the jurisdiction of a court of general jurisdiction in the state where the district court is located.'" Id. (quoting Fed. R. Civ. P. 4(k)(1)(A)).
A district court's exercise of personal jurisdiction over a defendant "depends on the defendant's having such 'contacts' with the forum State that 'the maintenance of the suit' is'reasonable, in the context of our federal system of government,' and 'does not offend traditional notions of fair play and substantial justice.'" Ford Motor Company v. Montana Eighth Judicial District Court, 141 S. Ct. 1017, 1024 (2021) (). With this focus in mind, the Supreme Court has recognized two kinds of personal jurisdiction: "general (sometimes called all-purpose) jurisdiction and specific (sometimes called case-linked) jurisdiction." Id. (citing Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011)).2
Specific personal jurisdiction, which is at issue here, was founded on "an idea of reciprocity" between a defendant and the forum. Id. at 1025. Put similarly, "[w]hen (but only when) a company 'exercises the privilege of conducting activities within a state'—thus 'enjoying the benefits and protections of its laws'—the State may hold the company to account for related misconduct." Id. (quoting Int'l Shoe Co., 326 U.S. at 319). A defendant should be provided with "fair warning," which means "knowledge that 'a particular activity may subject it to the jurisdiction of a foreign sovereign.'" Id. (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985)). "The law of specific jurisdiction . . . seeks to ensure that States with 'little legitimate interest' in a suit do not encroach on States more affected by the controversy." Id. (citing Bristol-Myers, 137 S. Ct. at 1780).
To establish specific personal jurisdiction, a federal court sitting in diversity must first ascertain whether the relevant state's long-arm statute permits the exercise of personal jurisdiction, then a court must ask whether it may properly exercise jurisdiction under the Due Process Clause.IMO Industries, Inc. v. Kiekert AG, 155 F.3d 254, 259 (3d Cir. 1998). Because "Pennsylvania's long-arm statute gives its courts jurisdiction over out-of-state defendants to the maximum extent allowed by the U.S. Constitution[,]" Danziger & De Llano, LLP v. Morgan Verkamp LLC, 948 F.3d 124, 129 (3d Cir. 2020), the Court's inquiry at step one is merged into its analysis at step two.3 Specific personal jurisdiction is accordingly present when the following three elements areestablished: (1) a defendant purposefully directs its activities at the forum, (2) a plaintiff's claims arise out of or relate to the defendant's activities, and (3) the exercise of personal jurisdiction does not "offend traditional notions of fair play and substantial justice." Id. (quoting Int'l Shoe Co., 326 U.S. at 316) (internal quotation marks omitted).
Beemac requests monetary relief under the following causes of action: (1) breach of contract; (2) unjust enrichment; (3) account stated; (4) fraud in the inducement; and (5) negligent misrepresentation. (ECF No. 1-1, ¶¶ 23-50). "Usually a court...
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