Tracy v. Paragon Contact Lens Laboratories, Inc.

• Decision Date: 23 May 1974
• Citation: 355 N.Y.S.2d 650,44 A.D.2d 455
• Parties: Ronald TRACY et al., Respondents, v. PARAGON CONTACT LENS LABORATORIES, INC., Appellant.
• Court: New York Supreme Court — Appellate Division

Page 650

355 N.Y.S.2d 650

44 A.D.2d 455

Ronald TRACY et al., Respondents, v. PARAGON CONTACT LENS LABORATORIES, INC., Appellant.

Supreme Court, Appellate Division, Third Department.

May 23, 1974.

Pearis, Resseguie, Hogan & Kline, Binghamton (Richard A. Barber, Binghamton, of counsel), for appellant.

Robert L. Miller, Elmira, for respondents.

Before STALEY, J.P., and GREENBLOTT, SWEENEY, MAIN and REYNOLDS, JJ.

GREENBLOTT, Justice.

This is an appeal from an order of the Supreme Court at Special Term, entered February 26, 1973 in Tioga County, which denied defendant's motion to dismiss the complaint because of lack of personal jurisdiction over the defendant.

Defendant Paragon Contact Lens Laboratories, Inc. is a Louisiana corporation with its offices in that state. Its business is supplying contact lenses to registered optometrists and physicians; it has no contact with patients, the ultimate users of its product. Approximately 15% ¹ of its business is interstate, primarily in Alabama, Mississippi and Pennsylvania, but defendant does no business in New York. It has not directly supplied its product to any optometrist or physician in the State, it does not solicit business or engage in a persistent course of conduct within the State, and it does not derive any revenue from goods sold within the State.

The plaintiff Nancy Jo Tracy ² is and apparently at all pertinent times was a resident of the Village of Waverly in Tioga County, New York. The Guthrie Clinic is a physicians' association affiliated with the Robert Packer Hospital, located in Sayre in Bradford County, Pennsylvania. Waverly and Sayre are adjacent communities, lying on opposite sides of the New York-Pennsylvania border. On or about May 15, 1968, Nancy Jo Tracy was fitted by a member of the staff of Guthrie Clinic for a pair of contact lenses allegedly manufactured by defendant. Defendant's moving papers indicate that it received an order for these lenses on June 17, 1968, and that it sent the lenses to Guthrie Clinic on July 19, 1968, without any indication of whom they were for or that they were to be used by a New York resident.

On or about June 15, 1969, the lens which Nancy Jo Tracy was wearing in her right eye allegedly broke into pieces, causing serious and permanent injuries to the eye. This action to recover damages for injury to the eye, based on defendant's alleged negligence and breach of warranty, was commenced on or about May 9, 1972 by personal service of a summons on defendant at its headquarters in New Orleans. Following service of the complaint, defendant moved to dismiss on the ground that the court did not have personal jurisdiction of the defendant (CPLR 3211, subd. (a), par. 8). Defendant's appeal is taken from the order denying said motion.

Inasmuch as defendant does no business whatsoever in this State, the only provision of our long-arm statute (CPLR 302), pursuant to which jurisdiction might be invoked, is so much of paragraph 3 of subdivision (a), which permits the exercise of personal jurisdiction over a nondomiciliary who 'commits a tortious act without the state causing injury to person or property within the state * * * if he * * * (ii) expects or reasonably should expect the act to have consequences in the state and derives substantial revenue from interstate or international commerce * * *.' This provision was enacted in 1966 as an amendment to CPLR 302 in an attempt to fill a gap demonstrated by the decision in Feathers v. McLucas, 15 N.Y.2d 443, 261 N.Y.S.2d 8, 209 N.E.2d 68. There, an action was brought in New York to recover for personal injuries and property damage sustained by an explosion in New York of a tractor-drawn tank containing propane gas. The tank had been manufactured in Kansas by the defendant, a foreign corporation with nationwide sales of steel products, and had been sold to a Missouri corporation 'presumably with knowledge that the latter would mount the tank on a wheelbase and then sell it to * * * a Pennsylvania corporation, which operated as a licensed interstate carrier in Pennsylvania and several other states, including New York' (15 N.Y.2d at p. 458, 261 N.Y.S.2d at p. 19, 209 N.E.2d at p. 76). In holding that there was no jurisdiction under the long-arm statute as then in effect, the Court of Appeals stated: 'If, in fact, the Legislature of this State had intended to confer jurisdiction on the strength of injurious forum consequences alone, without regard to the locus of the commission of the tortious act itself, it would presumably have used language appropriate to reflect such a design.' (15 N.Y.2d at p. 461, 261 N.Y.S.2d at p. 22, 209 N.E.2d at p. 78.) In the 'Report of the Judicial Conference to the 1966 Legislature in Relation to the Civil Practice Law and Rules' it is stated that 'the requirement of reasonable expectation of potential forum consequences...