Courtroom Television Network v. Focus Media, Inc.

• Decision Date: 19 August 1999
• Citation: 264 A.D.2d 351,695 N.Y.S.2d 17
• Court: New York Supreme Court — Appellate Division
• Parties: COURTROOM TELEVISION NETWORK, Appellant,<BR>v.<BR>FOCUS MEDIA, INC., Respondent.

264 A.D.2d 351

695 N.Y.S.2d 17

COURTROOM TELEVISION NETWORK, Appellant,

v.FOCUS MEDIA, INC., Respondent.

Decided August 19, 1999.

Concur — Rosenberger, J. P., Williams, Tom, Wallach and Buckley, JJ.

The issue in this breach of contract action is whether a New York court may assert jurisdiction over defendant Focus Media, Inc. (Focus), a California corporation. At all times relevant to this action, plaintiff Courtroom Television Network (Court TV) was a New York partnership located in New York City. Defendant Focus is an advertising and media-buying firm which places advertising on television broadcasts on behalf of its clients. In the fourth quarter of 1997, Focus bought 345 advertisements on Court TV on behalf of Focus's client Tactica. Plaintiff brought this action to recover on 10 allegedly unpaid invoices totaling over $101,000.

Focus is not licensed to do business in New York, nor does it have employees or an agent for service of process in New York. Moreover, it has no bank account or telephone listing in New York. Focus and Court TV negotiated the sale of advertising time for the 345 advertisements in question by means of telephone calls, letters and faxes between the parties. After Court TV accepted Focus's offer, Focus sent review tapes of the advertisements to Court TV in New York. Once the advertisements were approved, Focus sent dub tapes which were then broadcast by Court TV in the agreed-upon time slot.

The IAS Court granted Focus's motion to dismiss the complaint. The court found that Focus had insufficient contacts with New York for the assertion of general jurisdiction under CPLR 301, because it did not do business in this State on a continuous and systematic basis (Landoil Resources Corp. v Alexander & Alexander Servs., 77 NY2d 28, 33). The shipment of review tapes and dub tapes was found not to constitute supplying goods and services under CPLR 302 (a) (1). Finally, the court deemed Focus's contacts with New York for the purpose of buying advertising space on Court TV insufficient to qualify as transacting business in New York under CPLR 302 (a) (1).

Under CPLR 302, a nondomiciliary defendant is subject to the jurisdiction of New York State courts if the defendant engaged in some purposeful activity within the State and there is a substantial relationship between the activity and the cause of action sued upon (Amodeo v Star Mfg. Co., 88 AD2d 1081, 1082). The statute sets forth various grounds for long-arm jurisdiction. For instance, under CPLR 302 (a) (1), an out-of-State defendant may be sued in New York if it "transacts any business within the state or contracts anywhere to supply goods or services in the state". The requisite contacts may take place by mail or telephone; physical presence in the State is not required (Parke-Bernet Galleries v Franklyn, 26 NY2d 13). The key inquiry is whether defendant purposefully availed itself of the benefits of New York's laws (Parke-Bernet Galleries v Franklyn, supra, at 19). Jurisdiction may be predicated on a transaction conducted by means of telephone calls, faxes, and the acts of an in-State agent (Camel Invs. v Transocean Capital [Bermuda], 195 AD2d 533, 534).

Lupton Assocs. v Northeast Plastics (105 AD2d 3, 7) found jurisdiction under the "transacts any business" test of CPLR 302 (a) (1) where, as here, the out-of-State defendant contracted with the plaintiff for the latter to perform commercial activities in New York for the defendant's benefit. The defendant in Lupton made one shipment of goods to New York for p...