Opinion
No. CV 09-6000903-S
November 22, 2010
RULING RE THIRD-PARTY DEFENDANT'S MOTION TO DISMISS
In this case, the plaintiffs, George Gionis et al., sued the defendant, Russo's Marine Mart, Inc., a Massachusetts boat dealer, over the sale of a Rampage power boat. George Gionis and Richard Burke bought the boat in 2007 from Russo's for $400,000. The boat was delivered to the buyers in New London, CT. Allegedly, it was represented to be a new demo, but the buyers later discovered that it had run aground prior to sale and had been repaired, defectively, to their injury. After the lawsuit was filed, Russo's filed a third-party complaint against the business that repaired the boat prior to sale: MacDougalls Cape Cod Marine Service, Inc., a Massachusetts boat yard. The third-party complaint alleges that MacDougalls is liable to Russo's for breach of contract over the repair, and that it should indemnify Russo's for any liability to the buyers. Presently before the court is MacDougalls' motion to dismiss. (Doc. No. 135.00.) MacDougalls argues that the third party complaint against it should be dismissed because of lack of personal jurisdiction. For the following reasons, this court agrees. Accordingly, the third-party complaint is dismissed.
I
"A motion to dismiss . . . properly attacks the jurisdiction of the court, essentially asserting that the plaintiff cannot as a matter of law and fact state a cause of action that should be heard by the court . . . A motion to dismiss tests, inter alia, whether, on the face of the record, the court is without jurisdiction." (Citation omitted; internal quotation marks omitted.) Beecher v. Mohegan Tribe of Indians of Connecticut, 282 Conn. 130, 134, 918 A.2d 880 (2007). "The motion to dismiss . . . admits all facts which are well pleaded, invokes the existing record and must be decided upon that alone . . . Where, however . . . the motion is accompanied by supporting affidavits containing undisputed facts, the court may look to their content for determination of the jurisdictional issue . . ." (Citations omitted; internal quotation marks omitted.) CT Page 23205 Cogswell v. American Transit Ins. Co., 282 Conn. 505, 516, 923 A.2d 638 (2007). "If the defendant challenging the court's personal jurisdiction is a foreign corporation . . . it is the plaintiff's burden to prove the court's jurisdiction." Id., 515.
II
The issue in this motion is whether MacDougalls, a Massachusetts company, can be sued in Connecticut. Ordinarily, Connecticut courts only have personal jurisdiction over persons or businesses that are in residence or have a place of business in Connecticut. See Pennoyer v. Neff, 95 U.S. 714, 732-33, 24 L.Ed. 565 (1877). In this case, it is uncontested that MacDougalls is a Massachusetts business located in Massachusetts. It is considered a foreign corporation. Moreover, it repaired the boat at its boat yard in Falmouth, MA, for Russo's. It never did any business with the buyers. It did no work for any of the parties in Connecticut. It did work for Russo's, a Massachusetts company, in Massachusetts. There is no suggestion that MacDougall knew or should have known of the future sale or future destination of the boat. Ordinarily, if it is to be sued, the lawsuit should be filed against it in Massachusetts. However, Russo's claims that this court has personal jurisdiction over MacDougalls under the Connecticut long-arm statute. General Statutes § 33-929. MacDougalls, nevertheless moves to dismiss arguing that the long-arm statute does not apply under the facts in this case. It supplies facts in an affidavit by Thomas F. Stainton, General Manager of MacDougalls in support of its motion to dismiss. Russo's counter-argues that the long-arm statute applies, and it supplies excerpts from the deposition of Stainton in support of its arguments.
Both sides agree that the most pertinent provision of the long-arm statute on point in this case is General Statutes § 33-929(f)(2). That part of the statute provides:
Every foreign corporation shall be subject to suit in this state, by a resident of this state or by a person having a usual place of business in this state, whether or not such foreign corporation is transacting or has transacted business in this state and whether or not it is engaged exclusively in interstate or foreign commerce, on any cause of action arising as follows: . . . (2) out of any business solicited in this state by mail or otherwise if the corporation has repeatedly so solicited business, whether the orders or offers relating thereto were accepted within or without the state . . .
Neither party has raised the issue of whether Russo's can invoke this statute. The plain language of the statute suggests not. The statute only allows invocation by "a resident of [Connecticut] or by a person having a usual place of business in [Connecticut] . . ." General Statutes § 33-929(f)(2); Wilkinson v. Boats Unlimited, Inc., 236 Conn. 78, 87-88, 670 A.2d 1296 (1996). Russo's is a foreign corporation. The point has not been addressed by our appellate courts. Among the Superior Court judges that have addressed the point, there is a split in authority. See, e.g. Winkelman v. Dohm, Superior Court, judicial district of Waterbury, Doc. No. 096682 (April 27, 1992, Barnett, J.) [ 6 Conn. L. Rptr. 381] (allowing suit); Salgado v. Korta, Superior Court, judicial district of Fairfield, Doc. No. CV 05-4005829 (August 9, 2005, Gilardi, J.) [ 39 Conn. L. Rptr. 742] (dismissing suit); Fox Steel Co. v. Rohlf's Stained Lead Glass, Inc., Superior Court, judicial district of New Haven, Doc. No. CV 04-400971 (May 13, 2005, Devlin, J.) [ 39 Conn. L. Rptr. 353] (dismissing suit); Nationwide Mutual Ins. v. Davidson, Superior Court, judicial district of New London, Doc. No. 545891 (August 3, 1999, Mihalakos, J.) (dismissing suit). Since the parties have not raised the issue, the court will not address it, either.
General Statutes § 33-929(f)(2) (emphasis added).
Thus, the test in this case is whether MacDougalls repeatedly solicits business in Connecticut, and whether Russo's cause of action arises out of that business. The outcome depends on the facts. Pitruzello v. Muro, 70 Conn.App. 309, 319, 798 A.2d 469 (2002). The caselaw instructs that the phrase "arising . . . out of any business solicited in this state" does not require a causal connection between MacDougalls' Connecticut directed activities and the lawsuit. See Thompson v. Chemical Bank, 234 Conn. 281, 290, 661 A.2d 595 (1995). Nevertheless, "[i]t is the totality of [MacDougalls'] conduct and connection with this state that must be considered, on a case by case basis, to determine whether [MacDougalls] could reasonably have anticipated being haled into court here." (Citations omitted; internal quotation marks omitted.) Thomason v. Chemical Bank, supra, 234 Conn. 291. In other words, "[a] plaintiff's `cause of action aris[es] . . . out of . . . business solicited in this state' if, at the time the defendant engaged in solicitation in Connecticut, it was reasonably foreseeable that, as a result of that solicitation, the defendant could be sued in Connecticut by a solicited person on a cause of action similar to that now being brought by the plaintiffs." Id., 296.
Under this test, Russo's argues that MacDougalls admitted at deposition to advertising in a number of cruising guides, that it has a website, and that it advertises in some boating periodicals such as Sounding Magazine, all for the purpose of attracting customers from all over New England. It argues that this is sufficient to establish personal jurisdiction under General Statute § 33-929(f)(2). However, the court was not supplied with copies of the advertisements or a depiction of, or an address for, the website. To resolve this issue, the court should consider the nature and frequency of the advertising, and evaluate factors such as whether the ads and internet site are aimed at Connecticut boaters or dealers, and whether the advertisements and internet site are soliciting business or are merely informational. See, e.g., Wellner v. Kasarjian, Superior Court, judicial district of Hartford, Doc. No. CV 96-562940 (April 5, 1999, Peck, J.); Delbuono v. The Imperial Palace Hotel Casino, LLC, Superior Court, judicial district of New Haven, Doc. No. CV 07-5011543 (November 30, 2007, Zoarski, J.T.R.). Considering that the burden of proof is on Russo's to prove that the court has personal jurisdiction over MacDougalls, the court must conclude that the present record does not substantiate Russo's claim. Whether MacDougalls repeatedly solicits business in Connecticut under such circumstances that it was reasonably foreseeable that MacDougalls could be sued in Connecticut in this type of case is unsubstantiated. Consequently, it cannot be concluded that the court has personal jurisdiction over MacDougalls in this case on this ground.
Alternatively, Russo's argues that MacDougalls is subject to the long-arm statute because it transacts business in this state without having registered. On this point, the statute provides:
Every foreign corporation which transacts business in this state in violation of section 33-920 shall be subject to suit in this state upon any cause of action arising out of such business.
General Statutes § 33-929(e).
Russo's evidence on this point is that MacDougalls admitted at deposition that it has a mobile electronics van that can go up and down the East Coast to service customers. However, MacDougalls supplies an affidavit by its general manager that it has been in business since 1938, that it does not perform structural repairs in any state other than Massachusetts, and that only once, in the last eight years, it sent its electronics van to Connecticut to help a regular Massachusetts customer temporarily in Connecticut. Under this record Russo's has not substantiated its claim that MacDougalls transacts business in this state for the purposes of the long-arm statute. The relationship or nexus between MacDougalls' business and this state is simply "too attenuated." See, e.g., Ryan v. Cerullo, 282 Conn. 109, 121, 918 A.2d 867 (2007); see also General Statutes § 33-920(b)(10) ("The following activities . . . do not constitute transacting business . . . : conducting an isolated transaction that is completed within thirty days and that is not one in the course of repeated transactions of a like nature . . .").
Russo's offers the court the option of reserving decision to permit further discovery on this issue. The implication is that it is willing to proceed if it prevails, but would like more time to conduct more discovery if it might not prevail. The proposal is rejected. If that were permitted, litigation would be interminable. No continuance was requested. None is granted.
Absent sufficient evidence of grounds for invoking the long-arm statute, the court lacks personal jurisdiction over a foreign boat business, even though the ultimate customer was a Connecticut resident injured in Connecticut. See Wilkinson v. Boats Unlimited, Inc., 236 Conn. 78, 87, 670 A.2d 1296 (1996). In this case, the court finds insufficient evidence of grounds for invoking the long-arm statute. Thus, the court lacks personal jurisdiction over MacDougalls and its motion to dismiss must be granted. Of course, MacDougalls may still be subject to suit in Massachusetts.
III
Having concluded that the long-arm statute does confer personal jurisdiction over MacDougalls in this case, it is unnecessary to reach MacDougalls' other arguments: (A) that if it did confer jurisdiction, such an exercise would violate the due process clause of the United States Constitution under the "minimum contacts" test set forth in the seminal case of International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945); and (B) that MacDougalls was not served with process at the correct location in Massachusetts.
IV
For all of the above stated reasons, the third-party defendant's motion to dismiss (Doc. No. 135.00) is granted and third-party complaint is dismissed accordingly.