Pendzimas v. Eastern Metal Products Corporation

• Citation: 218 F. Supp. 524
• Decision Date: 28 April 1961
• Docket Number: No. 4-60 Civil 221.,4-60 Civil 221.
• Parties: Edward J. PENDZIMAS and Margaret L. Pendzimas, Plaintiffs, v. EASTERN METAL PRODUCTS CORPORATION, Defendant.
• Court: U.S. District Court — District of Minnesota

218 F. Supp. 524

Edward J. PENDZIMAS and Margaret L. Pendzimas, Plaintiffs, v. EASTERN METAL PRODUCTS CORPORATION, Defendant.

No. 4-60 Civil 221.

United States District Court D. Minnesota, Fourth Division.

April 28, 1961.

M. W. Gaughan, Minneapolis, Minn., for defendant, in support of motion.

K. R. Pearson, of Robins, Davis & Lyons, Minneapolis, Minn., for plaintiffs, in opposition thereto.

NORDBYE, District Judge.

This cause comes before the Court on defendant's motion for an order quashing, vacating and setting aside the service of the summons and complaint purportedly made upon it by serving the Secretary of State of the State of Minnesota, and for an order of dismissal herein.

The complaint alleges that the defendant, a corporation with its principal officers in Tuckahoe, New York, is engaged in the manufacture and sale of certain household appliances, including an electrical cooking device known as a deep fry, which product, according to the complaint, was sold by a retailer in Minnesota to plaintiffs in this State. The complaint alleges that the fryer was carelessly and negligently manufactured and assembled, whereby it functioned improperly and caused the overheating of cooking oil used therein, resulting in an explosion which caused personal injury to Margaret L. Pendzimas, one of the plaintiffs, and whereby Edward J. Pendzimas, her husband, sustained damages by reason of the personal injury to his wife.

The motion is based upon the following affidavit:

"SEYMOUR TROY, being duly sworn, deposes and says:

"I am the President of Eastern Metal Products Corporation, which has been named as the defendant in the above entitled action.

"I reside at 15 Southfield Road, Mt. Vernon, New York, and have my offices at 135 Marbledale Road, Tuckahoe, New York, Eastern Metal Products Corporation is a corporation organized under the laws of the State of New York, and was engaged until 1957 in the business of assembling and distribution of deep fryers.

"Eastern Metal Products Corporation maintains no warehouse facilities but prior to and in 1957 did maintain warehouse facilities at Tuckahoe, New York, and Fort Smith, Arkansas.

"Eastern Metal Products Corporation does not have any office in the State of Minnesota. It has no warehouse space in Minnesota and has no employee or agent in the State of Minnesota. It owns no property of any kind in the State of Minnesota.

It has never been authorized to do business in the State of Minnesota by the authorities of the State of Minnesota.

"This action did not arise out of any business transacted by Eastern Metal Products Corporation with any resident of the state of Minnesota and this action does not arise out of anything done by the Eastern Metal Products Corporation in the State of Minnesota.

"The deep fryers, Model RF 90, according to the records of the Eastern Metal Products Corporation, were shipped in response to an order through the mail of World Enterprise, 509 Hennepin Avenue, Minneapolis, Minnesota, a wholesaler. That the records of Eastern Metal Products Corporation show no dealings with Hannah's Furniture and Appliance Store, 707 East Lake street, Minneapolis, Minnesota, nor with any Hannah's Furniture and Appliance Store at any location. Eastern Metal Products Corporation has no knowledge or information as to what disposition was made of said deep fryer after it was shipped F.O.B. New York City, or F.O.B. Ft. Smith, Arkansas.

"All orders by wholesalers, retailers and independent factory representatives from Minnesota were placed directly with the Eastern Metal Products Corporation's factory located at Tuckahoe, N.Y. and/or Ft. Smith, Arkansas, for acceptance. All orders sent to Minnesota wholesalers and retailers were sent by collect freight from the Eastern Metal Products Corporation factory and billings were also made from said factory.

"Eastern Metal Products Corporation has and had no control over wholesalers and retailers in the State of Minnesota and has and had no contact with the ultimate consumers. Eastern Metal Products Corporation carried on no advertisement of its products within the State of Minnesota.

"Seymour Troy"

There is no showing by the plaintiffs as to any activities in this State by the defendant other than those stated in the above affidavit. Service was purportedly obtained by serving the Secretary of State and jurisdiction is based upon the following Minnesota statute, the pertinent portions of which read as follows (Sec. 303.13 subd. 1(3), Minn.Stat. Ann.):

"If a foreign corporation * * commits a tort in whole or in part in Minnesota against a resident of Minnesota, such acts shall be deemed to be doing business in Minnesota by the foreign corporation and shall be deemed equivalent to the appointment by the foreign corporation of the secretary of the State of Minnesota * * * to be its true and lawful attorney upon whom may be served all lawful process in any actions or proceedings against the foreign corporation arising from or growing out of such * * * tort * * *."

The question submitted is substantially the same as that which was before this Court in Mueller v. Steelcase Co., Inc., D. C., 172 F.Supp. 416. Since that decision, however, the Supreme Court of Minnesota has handed down three decisions, to wit, Beck v. Spindler, 256 Minn. 543, 99 N.W.2d 670; Atkins v. Jones & McLaughlin Steel Co., 258 Minn. 571, 104 N.W.2d 888¹; and Dahlberg Co. v. Western Hearing Aid Center, 259 Minn. 330, 107 N.W.2d 831. In Atkins v. Jones & McLaughlin Steel Co., supra, the Supreme Court upheld the constitutionality of the statute here involved and determined that the statute did not deny the defendant due process under the Federal Constitution. In that case the plaintiff was injured in this State while unloading containers of hydrofluosilicic acid, the product of the defendant, a corporation organized in New York, not qualified to do business in this State and which did no business herein except that which allegedly arose under the Minnesota statute above quoted. It had, however, sold its product to customers in Minnesota for some fifty years f. o. b. New York. But the court apparently did not consider the length of time defendant had sold its merchandise to customers in Minnesota a matter of any significance. It was the single tortious act in New York causing the injury to plaintiff in Minnesota which was held to be the doing of business herein sufficient to sustain the service of process under the Minnesota statute.

But notwithstanding the views of the Minnesota Supreme Court in these recent cases, I am constrained, in light of the present factual situation, to adhere to the views expressed in the Mueller case, with some further amplification and possible clarification. In that case I stated that the defendant "performed no tortious act in Minnesota." In making that statement, I was fully aware that we do not have an actionable tort until someone is injured. The tort may be localized here because it was in this State that the last of the events took place which would make the tortfeasor liable. However, neither in the Mueller case nor in the instant situation did the defendant come into this State and perform a tortious act.²

No doubt due process may be sustained where there is a single act transaction in a State by a foreign corporation. The entering into a contract in whole or in part, or the commission of a tort in whole or in part in this State by a foreign corporation may meet the minimal contacts which square with the principles of due process as enunciated in International Shoe Company v. State of Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95. But in the instant case, according to the showing made herein, the defendant has not had even the barest vestige of any contacts, realistically considered, within the State of Minnesota. The Court fully recognizes that in light of the modern trend of the decisions, it is not necessary to find that the defendant is "present" in the State. Nor is it necessary to find that by reason of its activities herein, it is constructively here. However, it is difficult, consistent with the teachings of the weight of authority, to find any support for the fiction that, by reason of a single sale of merchandise to a Minnesota wholesaler consummated in another State, a negligent foreign corporation, without more, has therefore by a so-called voluntary act, brought this litigation into being in this State and subjected itself to process herein because here the last event took...