Preferred Display, Inc. v. Vincent Longo, Inc.

Citations: 642 F. Supp. 2d 98; 2009 U.S. Dist. LEXIS 68142; 2009 WL 2400966Docket: 3:09-mc-00365

Court: District Court, D. Connecticut; August 4, 2009; Federal District Court

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Preferred Display, Inc. (PDI) filed a lawsuit against Vincent Longo, Inc. (VLI) in the U.S. District Court for the District of Connecticut, seeking payment for unpaid invoices related to cosmetics display cases. PDI's claims include breach of contract, unjust enrichment, and a violation of Connecticut's Uniform Commercial Code (UCC). VLI responded with a motion to dismiss the case, arguing a lack of personal jurisdiction.

The court outlines the standard for evaluating a motion to dismiss under Rule 12(b)(2), stating that the burden is on the plaintiff to demonstrate the court's jurisdiction over the defendant. The plaintiff may initially establish jurisdiction through legally sufficient allegations, with a prima facie showing required before discovery is complete. Affidavits and other materials can support this showing, and all allegations are viewed in the light most favorable to the plaintiff.

The court must first apply Connecticut's long arm statute to determine if jurisdiction is permissible and then assess whether exercising that jurisdiction aligns with due process requirements. In this instance, the court ultimately granted VLI's motion to dismiss for lack of personal jurisdiction. PDI is identified as a New Jersey corporation based in Clifton, New Jersey, specializing in manufacturing custom cosmetics display cases for retail.

PDI operates offices and manufacturing facilities in Connecticut and New Jersey, while VLI, a New York corporation based in New York City, sells cosmetics through its website and retail partners, including Sephora and Beautiful Faces in Connecticut. VLI has reportedly failed to pay 22 invoices totaling $441,855.19 to PDI for display cases, with at least three cases shipped from New Jersey to Connecticut retailers. VLI contends that the court lacks personal jurisdiction, arguing that PDI, as a non-resident, cannot invoke Connecticut's long arm statute (section 33-929(f)) without having a usual place of business in Connecticut. PDI must demonstrate such a business presence to qualify as a plaintiff under this statute, as clarified by relevant case law. The court notes that while Connecticut's definitions of "usual place of business" are limited, precedent suggests that having a certificate of authority and maintaining operations in the state can suffice to establish this status. The court finds that VLI's assertion about the necessity of being incorporated or primarily based in Connecticut does not align with the statute's language.

The statute requires that the plaintiff must have a "usual place of business" in Connecticut, which PDI satisfies as it is registered to do business in the state and has one location there. However, establishing jurisdiction under Conn. Gen.Stat. § 33-929(f) also necessitates that the cause of action arises from certain specified scenarios. 

For jurisdiction under § 33-929(f)(1), it must be shown that the cause of action arises from a contract made or to be performed in Connecticut. VLI claims the contract was made in New York or New Jersey, and PDI has not claimed otherwise nor provided evidence to support a finding that the contract was made in Connecticut. The court then examines whether the contract was "to be performed" in Connecticut, noting that performance does not need to be explicitly stated in the contract.

To establish jurisdiction based solely on plaintiff's performance, PDI must demonstrate either that the contract required performance in Connecticut or that the most substantial part of its obligations was performed there. PDI has not shown that the contract expressly required performance in Connecticut, nor has it provided sufficient evidence that the most substantial part of its obligations was performed there. The parties dispute the nature of PDI's obligations, with PDI asserting it was to assemble and ship display cases, while VLI claims it was to deliver them. The absence of the actual contract in the record complicates the court's evaluation of whether PDI has met its burden to establish jurisdiction based on performance in Connecticut.

PDI's brief indicates that some display cases were assembled in Connecticut, and parts of the contract were partially performed there. However, these assertions do not demonstrate that PDI's primary performance under the contract took place in Connecticut. If PDI's obligation was to deliver the display cases, their assembly in Connecticut is not pertinent to jurisdiction. The display cases related to the unpaid invoices were delivered nationwide, with only three going to Connecticut, indicating that most performance occurred outside the state. Consequently, PDI does not satisfy the requirements for personal jurisdiction under Conn. Gen. Stat. § 33-929(f)(1).

Regarding jurisdiction under Conn. Gen. Stat. § 33-929(f)(3), which pertains to foreign corporations and their goods distributed with the expectation of use in Connecticut, the relevant goods are the display cases. Although some cases were made and used in Connecticut, PDI, not VLI, was responsible for their manufacture and distribution. Therefore, the statute does not apply, as it requires the foreign corporation to have produced or distributed the goods in Connecticut.

As for Conn. Gen. Stat. § 33-929(e), VLI claims that even if PDI sought jurisdiction under this statute, it would fail. This statute allows personal jurisdiction over a foreign corporation that transacts business in Connecticut without proper authorization, provided the cause of action stems from that business. VLI contends that PDI cannot invoke this statute because VLI did not transact business in Connecticut, and even if it did, PDI's claims do not arise from such activities. The court notes that if VLI transacted business in Connecticut, it involved selling cosmetics in retail stores, but does not take a definitive stance on this issue.

PDI's claims are based on unpaid invoices for display cases, not on VLI's retail sale of cosmetics in Connecticut, failing to meet the jurisdictional criteria under section 33-929(e). Consequently, the court lacks jurisdiction over VLI, leading to the granting of the defendant's Motion to Dismiss for Lack of Personal Jurisdiction. The case is ordered closed with judgment entered for the defendant. Additionally, the court notes that the discovery deadline is set for September 4, 2009. Changes to the Connecticut long-arm statute in 1997 did not affect the relevant sections applied in this case, which are consistent with prior precedent. Other jurisdiction scenarios, such as repeated solicitation or tortious conduct, are not relevant here. It remains unclear if the invoices stem from a single contract or multiple agreements, but the court will treat them as one for this ruling. Ambiguous statements made by Wilson regarding the case's connection to Connecticut do not provide sufficient grounds for jurisdiction under Conn. Gen.Stat. § 33-929(f)(1). The court also notes that foreign corporations must have a certificate of authority to conduct business in Connecticut. Since the long arm statute does not apply to VLI, the court does not address constitutional due process implications.