Opinion
MDL 1428 (SAS), No. 02 Civ. 3101 (SAS).
March 6, 2006
Appearances
For Plaintiffs:
Jay J. Rice, Esq. Nagel, Rice, Dreifuss Mazie, LLP Livingston, NJ.
Robert A. Swift, Esq. Hilary Cohen, Esq. Kohn, Swift Graf, PC Philadelphia, PA.
Kenneth Nolan, Esq. Christina Fry, Esq. Speiser, Krause, Nolan Granito New York, NY.
For Defendant:
Arthur J. Liederman, Esq. Aarti Soni, Esq. Morrison Mahoney LLP New York, NY.
OPINION AND ORDER
Plaintiffs, the relatives of Americans who died in a ski train fire on November 11, 2000, in Kaprun, Austria, brought several actions against numerous individual and corporate defendants for damages and declaratory and injunctive relief. The Judicial Panel on Multidistrict Litigation ("MDL Panel") consolidated these suits for pretrial purposes before this Court. Defendant Bosch Rexroth AG ("BRAG") now moves to dismiss for lack of personal jurisdiction. For the reasons set forth below, BRAG's motion to dismiss is denied.
See In re Ski Train Fire in Kaprun, Austria on November 11, 2000, 175 F. Supp. 2d 1379 (J.P.M.L. 2001).
I. BACKGROUND
The following facts are drawn from the parties' submissions, and are undisputed unless otherwise noted.
involved in the sale of hydraulic systems and applications." Given their common relationship to Robert Bosch GmbH, BRAG and BRC are referred to by plaintiffs as "sister corporations" and by defendant as "cousins." The two companies have a relationship in which BRAG sells components that it has manufactured to BRC, which acts as a distributor of these parts in the United States. "This relationship has further involved BRAG's offer of technical expertise and knowledge to BRC and BRAG's assistance to BRC in its use of the Rexroth `brand.'"
Reply Memorandum of Law in Further Support of Bosch Rexroth AG's Motion to Dismiss for Lack of Personal Jurisdiction ("Reply Mem.") at 2.
Plaintiffs' Brief in Opposition to Defendant Bosch Rexroth AG's Motion to Dismiss for Lack of Personal Jurisdiction ("Pl. Mem.") at 13.
Reply Mem. at 1.
Id. at 10.
B. Procedural History
The original complaint in this case was filed in the Eastern District of Pennsylvania on August 17, 2001, and subsequently amended by the Consolidated Complaint in the MDL proceeding. On May 17, 2002, BRAG filed a motion to dismiss plaintiffs' complaint in which one of the grounds was lack of personal jurisdiction. On August 14, 2002, this Court denied BRAG's motion, subject to renewal upon the completion of jurisdictional discovery. BRAG filed a renewed motion to dismiss for lack of personal jurisdiction on December 19, 2005.
See In re Ski Train Fire in Kaprun, Austria on November 11, 2000, 230 F. Supp. 2d 392, 396-97 (S.D.N.Y. 2002).
II. APPLICABLE LEGAL STANDARDS
Personal jurisdiction in a diversity action "is determined in accordance with the law of the [forum state], with `federal law' entering the picture only for the purpose of deciding whether a state's assertion of jurisdiction contravenes a constitutional guarantee." The forum state in an MDL proceeding is the district court where the action was originally filed. Thus, this Court looks to Pennsylvania law to determine whether personal jurisdiction is proper. In order for a Pennsylvania court to exercise jurisdiction over a nonresident defendant, plaintiffs must show that (1) Pennsylvania's long-arm statute authorizes jurisdiction; and (2) the exercise of jurisdiction satisfies constitutional principles of due process.
Arrowsmith v. United Press Int'l, 320 F.2d 219, 223 (2d Cir. 1963).
See In re MTBE Litig., 175 F. Supp. 2d 593, 606 n. 20 (S.D.N.Y. 2001) ("When considering questions of state law the transferee court must apply the state law that would have applied to the individual cases had they not been transferred for consolidation.").
See Vetrotex Certainteed Corp. v. Consolidated Fiber Glass Prods. Co., 75 F.3d 147, 150 (3d Cir. 1996) (noting that a district court sitting in diversity applies the law of the forum state to determine whether personal jurisdiction is proper).
See 42 Pa. Cons. Stat. § 5301 et seq. (Purdon's 2002).
See Graham v. Machinery Dist., Inc., 410 Pa. Super. 267, 269-70 (1991); Temtex Prods., Inc. v. Kramer, 330 Pa. Super. 183, 194 (1984).
Once a defendant raises a personal jurisdiction defense, the burden of establishing the court's jurisdiction rests with plaintiff. The plaintiff's burden is "to make a prima facie showing with sworn affidavits or other competent evidence that such jurisdiction exists." In this case, plaintiffs argue that BRAG's direct contacts with Pennsylvania are sufficient to confer general jurisdiction. In the alternative, they rely on BRAG's relationship with BRC and argue that the nature of the relationship is such that BRC's contacts with the forum may be imputed to BRAG.
See Cinalli v. Kane, 191 F. Supp. 2d 601, 610 (E.D. Pa. 2002).
Rose v. Continental Aktiengesellschaft (AG), No. 99 Civ. 3794, 2001 WL 236738, at *1 (E.D. Pa. Mar. 2, 2001) (citing Time Share Vacation Club v. Atlantic Resorts, Ltd., 735 F.2d 61, 66-67 n. 9 (3d Cir. 1984)).
Plaintiffs do not claim that BRAG should be subject to specific jurisdiction. See Pl. Mem. at 4.
A. Direct Contacts
To determine whether the exercise of personal jurisdiction satisfies principles of due process, Pennsylvania courts apply a two-prong test. First, a court must determine whether the defendant purposefully established sufficient contacts with the forum. Second, "jurisdiction may be exercised where the court determines, in its discretion, that to do so would comport with `traditional notions of fair play and substantial justice.'" "In determining whether this requirement has been met, a court should consider the following: (1) the burden on the defendant, (2) the forum state's interest in adjudicating the dispute, (3) the plaintiff's interest in obtaining convenient and effective relief, (4) the interstate judicial system's interest in obtaining the most efficient resolution of controversies and (5) the shared interest of several states in furthering fundamental substantive social policies."
See Vetrotex Certainteed, 75 F.3d at 150-51; Cinalli, 191 F. Supp. 2d at 610.
See Vetrotex Certainteed, 75 F.3d at 150 (citing Burger King v. Rudzewicz, 471 U.S. 462, 474 (1985)).
Id. at 150-51 (quoting International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)).
American Bus. Fin. Servs., Inc. v. First Union Nat'l Bank, No. 01 Civ. 4955, 2002 WL 433735, at *5-6 (Pa. Com. Pl. Mar. 5, 2002) (citing Kubik v. Letteri, 532 Pa. 10, 14 (1992)).
The Pennsylvania long-arm statute authorizes jurisdiction "`to the fullest extent allowed under the Constitution of the United States,'" and under either of two theories. If a plaintiff's cause of action arises out of the defendant's forum-related activities or contacts, defendant may be subject to "specific jurisdiction." Specific jurisdiction is focused on the particular acts of the defendant that gave rise to the underlying cause of action. General jurisdiction, in contrast, exists where a defendant has engaged in continuous and systematic activities within the forum, permitting a court to exercise jurisdiction over the defendant for non-forum-related disputes. Contacts are considered continuous and systematic only if they are "extensive and pervasive," making the standard for general jurisdiction "`much higher than that for specific jurisdiction.'" When evaluating a corporation's ties to a state for purposes of general jurisdiction, "neither the percentage of business in the forum state, nor the absolute amount of sales and customers in the forum state is dispositive proof" of continuous and systematic activity. Instead, a court should look to the party's "purposeful and extensive availment" of a forum, and consider the degree to which a corporation's contacts with a given forum are "central to the conduct of its business."
Renner v. Lanard Toys Ltd., 33 F.3d 277, 279 (3d Cir. 1994) (quoting 42 Pa. Cons. Stat. § 5322(b)).
42 Pa. Cons. Stat. § 5322. Accord Allied Leather Corp. v. Altama Delta Corp., 785 F. Supp. 494, 497 (M.D. Pa. 1992).
See, e.g., American Bus. Fin. Servs., 2002 WL 433735, at *5.
See 42 Pa. Cons. Stat. § 5301; Pennzoil Prods. Co. v. Colelli Assocs., 149 F.3d 197, 200-01 (3d Cir. 1998); Allied Leather, 785 F. Supp. at 497.
Field v. Ramada Inn, 816 F. Supp. 1033, 1036 (E.D. Pa. 1993).
Rose, 2001 WL 236738, at *1 (quoting Clark v. Matsushita Elec. Indus. Co., 811 F. Supp. 1061, 1067 (M.D. Pa. 1993)).
Modern Mailers, Inc. v. Johnson Quin, Inc. 844 F. Supp. 1048, 1053 (E.D. Pa. 1994) (citing Provident Nat'l Bank v. California Fed. Sav. Loan Assoc., 819 F.2d 434, 438 (3d Cir. 1987)).
Provident Nat'l Bank, 819 F.2d at 437, 438.
B. Imputing Forum Contacts of a Related Company
In some circumstances, the contacts of a resident corporation may be imputed to a nonresident defendant for purposes of establishing personal jurisdiction. Under Pennsylvania law, such contacts will be attributed to the nonresident corporation "when one of three circumstances is present: (1) the independence of the two corporate entities has been disregarded; (2) the parent corporation exercises control over the subsidiary such that the two should be considered one company; or (3) the subsidiary performs important functions that otherwise the parent would have to perform on its own."
Lewis-Ugdah v. HBE Corp., No. 00 Civ. 3884, 2000 WL 1780233, at *3 (E.D. Pa. Dec. 1, 2000) (citing Brooks v. Bacardi Rum Corp., 43 F. Supp. 559, 562-63 (E.D. Pa. 1996)). See also Arch v. American Tobacco Co., 984 F. Supp. 830, 837 (E.D. Pa. 1997) (suggesting a comprehensive approach whereby "all relevant factors" contained in the three tests are considered at once); In re Latex Gloves Prods. Liab. Litig., No. MDL 1148, 2001 WL 964105, at *3 (E.D. Pa. Aug. 22, 2001) (citing Superior Coal Co. v. Ruhrkohle, A.G., 83 F.R.D. 414, 421 (E.D. Pa. 1979)) (listing ten factors to consider, which "offer a discretely individuated and functional framework for this analysis").
Plaintiffs invoke the second of these circumstances, which courts apply when a parent's control over its subsidiary is so complete that it is a "mere department" of the parent. "`The degree of control exercised by the parent must be greater than normally associated with common ownership and directorship.'" "Appropriate parental involvement includes: `monitoring of the subsidiary's performance, supervision of the subsidiary's finance and capital budget decisions, and articulation of general policies and procedures.'" Such involvement by the parent does not render the subsidiary a mere department of it. For the subsidiary to be a mere department, plaintiffs must prove that the parent controls the day-to-day operations of the subsidiary.
Schulman v. Walt Disney World Co., No. 91 Civ. 5259, 1992 WL 38390, at *3 (E.D. Pa. Feb. 25, 1992) (citing Schenck v. Walt Disney World Comp., 742 F. Supp. 838 (S.D.N.Y. 1990)).
Arch, 984 F. Supp. at 837-38 (quoting Savin Corp. v. Heritage Copy Prods., Inc., 661 F. Supp. 463, 469 (M.D. Pa. 1987)).
In re Latex Gloves Prods. Liab. Litig., 2001 WL 964105, at *3 (quoting United States v. Bestfoods, 524 U.S. 51, 72 (1998)).
See Arch, 984 F. Supp. at 838 n. 10.
These quotations reveal that the vast majority of cases addressing this issue involve the relationships between parent and subsidiary corporations. But plaintiffs note that at least two courts have implied that the relationship between "sister" corporations could potentially satisfy the third test listed above, which is sometimes referred to as the "agency" inquiry.
See Pl. Mem. at 13 (citing Frummer v. Hilton Hotels, Int'l, Inc., 19 N.Y.2d 533, 537-38 (1967); Hvide Marine Int'l Inc. v. Employers Ins. of Wausau, 724 F. Supp. 180, 185 (S.D.N.Y. 1989)).
III. DISCUSSION
A. Defendant's Direct Contacts with Pennsylvania
BRAG is not qualified or registered to do business in Pennsylvania, and neither owns nor leases any real estate in Pennsylvania or the United States. The company has no office, telephone listing, or mailing address in Pennsylvania. It also has no bank account or assets in the United States and does not pay taxes. Yet plaintiffs argue that BRAG's direct contacts with Pennsylvania are sufficiently continuous and systematic to justify this court's exercise of general jurisdiction. Indeed, it is well established that personal jurisdiction can exist without a showing that the defendant has established a physical presence in the forum state.
See 5/17/02 Affidavit of Ingo Neuer, Head of BRAG Legal Department ("Neuer Aff."), Ex. B to 12/19/05 Affirmation of Arthur J. Liederman, Counsel to Defendant ("Liederman Aff.") ¶¶ 2, 4, 5, 11.
See id. ¶¶ 7-9.
See id. ¶¶ 10-11.
See Pl. Mem. at 5-12.
See, e.g., Burger King, 471 U.S. at 476 ("So long as a commercial actor's efforts are purposefully directed toward residents of another State, we have consistently rejected the notion that an absence of physical contacts can defeat personal jurisdiction there.") (quotation marks and citations omitted).
BRAG has exported a great quantity of its products to Pennsylvania. From August 1999 through August 2001, BRAG derived revenues of $200,460,933 from sales in Pennsylvania alone. Defendant argues that this revenue derived from sales to BRC, and that the products sold were used to design and build applications for BRC customers, with whom BRAG had no direct involvement. But the relevance of sales in the forum is not dependent on the number of customers or the percentage of a company's overall revenues — courts should instead consider "whether [defendant] has substantial and significant ties with [Pennsylvania] through the sale of its product here." To obtain two hundred million dollars in revenue from Pennsylvania over a two year period, BRAG shipped its products on a biweekly basis, and most likely engaged in daily communication with its buyer in the forum.
See Pl. Mem. at 2; Defendant Bosch Rexroth AG's First Supplemental Responses to Plaintiffs' First Set of Interrogatories as to Jurisdiction Directed to the Bosch Rexroth Defendants ("BRAG's Supp. Interrogatory Response"), Ex. 1 to 1/7/06 Declaration of Hilary Cohen, Counsel to Plaintiffs ("Cohen Decl."), at 4-5. The total revenues derived from sales in the United States over the same time period amounted to $1,287,814,352. See id. at 4-5; Pl. Mem. at 2.
See, e.g., Memorandum of Law in Support of Bosch Rexroth AG's Motion to Dismiss for Lack of Personal Jurisdiction ("Def. Mem.") at 5 ("At best the evidence will only establish that BRAG had a working relationship with a distributor in Pennsylvania but that it did not have any other relationships or business interests in Pennsylvania.").
See Supplemental Affidavit of Ingo Neuer ("Supp. Neuer Aff."), Ex. D to 1/23/06 Reply Affirmation of Arthur J. Liederman ("Liederman Reply Aff."), ¶ 12; Affidavit of Alfons Weber, Executive Vice President of BRAG ("Weber Aff."), Ex. A to Liederman Reply Aff. ¶ 5.
Amp Inc. v. Methode Elecs., Inc., 823 F. Supp. 259, 268 (M.D. Pa. 1993).
See 6/2/00 Email from BRAG, Ex. 6 to Cohen Decl. (describing shipping schedule of parts from BRAG to BRAG every Sunday and Wednesday, resulting in import of up to 100,000 pounds of BRAG products per month); Pl. Mem. at 6 (describing the "hundreds of thousands of invoices, delivery orders, and communications related [to] sales into Pennsylvania").
BRAG's marketing efforts directed at the forum are also relevant to establishing that it had continuous and systematic contacts. BRAG claims that it "conducts no advertising and does not market any products in the State of Pennsylvania or the United States." But BRAG admits that BRAG and BRC "have cooperated in analyzing the United State[s] market," and that BRAG has performed additional marketing studies about the United States market in Germany that did not constitute joint efforts with BRC. Plaintiffs also assert that BRAG researched and developed the U.S. market for its products and services, by increased use of the English language and by "americanizing" its catalogs.
See, e.g., Corporate Aviation Concepts, Inc. v. Multiservice Corp., No. 03 Civ. 3020, 2003 WL 22794693, at *3 (E.D. Pa. Nov. 13, 2003).
Neuer Aff. ¶ 6.
Reply Mem. at 23.
See Supp. Neuer Aff. ¶ 14. Plaintiffs assert that a marketing-related project called the "Stealth Tier Project" was undertaken in cooperation with BRC to expand the U.S. market, but BRAG's General Counsel said in his affidavit that this project was never implemented. See id. ¶ 8.
See Pl. Mem. at 6, 10, 11.
Finally, plaintiffs also rely on the fact that BRAG personnel made many trips to Pennsylvania during the relevant time period. Dozens of BRAG employees came for short periods of time to participate in meetings, and at least twenty-two BRAG employees, on thirty-eight different occasions, worked in Pennsylvania for more than one month. Whether or not these employees should be considered "regularly employed in Pennsylvania," they certainly constitute further evidence that BRAG's contacts with the forum occurred frequently and were at the core of its business, so that BRAG should reasonably anticipate being haled into a court of the state.
See BRAG/BRC Travel Summary Pursuant to Federal Rule of Evidence 1006 ("Pl. Travel Summary"), Ex. 2 to Cohen Decl. In fact, plaintiffs state that BRAG sent more than ninety-five employees to Pennsylvania, and that these employees "spent more than ten years of manpower days working at BRC and in Pennsylvania." Pl Mem. at 2 (citing Pl. Travel Summary).
See Pl. Mem. at 9-10; Pl. Travel Summary. BRAG disputes these characterizations of employee travel and some of the underlying facts that plaintiffs use to support them. See, e.g., Supp. Neuer Aff. ¶¶ 3, 4, 13. On the other hand, plaintiffs believe that there "were many more trips to Pennsylvania since it is indisputable that BRAG failed to produce all responsive travel documents and meeting minutes." Pl. Mem. at 7 n. 3. This dispute does not affect the general jurisdiction analysis — there is already evidence in the record of fairly extensive travel of BRAG employees to Pennsylvania, and the question is what such evidence establishes.
Pl. Mem. at 10. See also Def. Mem. at 1 (stating that BRAG has "no employees regularly located within the United States").
Cf. Provident Nat'l Bank, 819 F.2d 434 (California bank subjected to general jurisdiction although its only contacts with Pennsylvania consisted of having a minuscule percentage of its depositors in Pennsylvania, receiving a minimal amount of its deposits from Pennsylvanians, and having few outstanding loans to Pennsylvania residents, because it engaged in daily transactions in the forum, and these transactions were at the core of its business); Silva v. Maryland Screen Printers, Inc., No. 04 Civ. 2018, 2005 WL 2250842, at *3 (M.D. Pa. Sept. 15, 2005) (defendant subjected to general jurisdiction because agents of defendant solicited sales from Pennsylvania customers and defendant sold and shipped merchandise to Pennsylvania purchasers); Amp Inc., 823 F. Supp. 259 (foreign manufacturer subjected to general jurisdiction, because although manufacturer's Pennsylvania sales were not a significant percentage of its overall sales, it had substantial level of Pennsylvania sales, and had continuous and substantial ties with Pennsylvania customers through network of distributors and sales agents who, though located outside Pennsylvania, regularly sold products there).
The facts of this case are analogous to those summarized in a recent decision, Paradise Motors v. Toyota De Puerto Rico Corp. The Court wrote:
Although Toyota Motor does not have a business license, it does have contacts with this jurisdiction that are continuous and systematic. It is undisputed that Toyota Motor has shipped Toyota vehicles directly to Paradise in the Virgin Islands. . . . Paradise's president testifies that their sales of Toyota vehicles average $2,000,000 dollars per year. Furthermore, Toyota Motor does not deny that it continues to manufacture Toyotas sold in the Virgin Islands. Additionally, Toyota Motor has sent representatives and materials to Paradise to facilitate the continued sale of its products. For these reasons, I find that Toyota Motor is subject to general jurisdiction.
314 F. Supp. 2d 495 (D.V.I. 2004).
Id. at 499 (citations omitted).
Here, as in Paradise Motors, the direct contacts plaintiffs have demonstrated between BRAG and the forum state are sufficient to establish "continuous and systematic general business contacts."
Field, 816 F. Supp. at 1036.
The exercise of general jurisdiction over BRAG in this case also comports with `traditional notions of fair play and substantial justice.'" BRAG has clearly availed itself of the benefits of doing business in Pennsylvania. Given the nature of defendant's contacts in the state, the particular circumstances of this case, and plaintiffs' interest in obtaining convenient and effective relief, defendant can be sued in this forum.
Vetrotex Certainteed, 75 F.3d at 150-51 (quoting International Shoe, 326 U.S. at 316).
B. Jurisdiction Based on BRC's Presence in Pennsylvania
Having found that defendant's direct contacts with Pennsylvania are sufficient to establish general jurisdiction, I now turn to plaintiffs' argument that this Court may exercise jurisdiction over BRAG based on the activities of BRC. The parties do not dispute that BRC is "present" in Pennsylvania and subject to personal jurisdiction in the state. Plaintiffs argue that BRC is BRAG's agent and also that BRC performs the functions that BRAG would perform if it were present in the forum. Thus, they urge this Court to base jurisdiction over defendant on BRC's presence in Pennsylvania.
See Pl. Mem. at 12-22.
Plaintiffs rely on various assertions about the relationship between BRAG and BRC. Both corporations are admittedly owned by Bosch Rexroth GmbH, and plaintiffs point to overlap between the management and leadership teams among Bosch Rexroth GmbH subsidiaries. In addition, BRAG has met with BRC to discuss their relationship, and its employees and board members have frequently traveled to Pennsylvania. The two corporations have a uniform trademark and logo, and there is a dispute as to whether they have ever engaged in joint projects together. Finally, plaintiffs argue that BRC is a point of contact for BRAG in the forum and "provides the American face" to BRAG advertising.
See id. at 16-18; Employee Overlap Between Bosch Rexroth AG and Bosch Rexroth Corporation Chart, Ex. 12 to Cohen Decl.
See Def. Mem. at 8; Pl. Travel Summary.
See 12/1/05 Interpreted Oral Deposition of Christoph Kainzbauer, Ex. 5 to Cohen Decl., at 30, 32-34.
See Pl. Mem. at 11 (describing the "DXX project"); Reply Mem. at 5 (contesting its relevance). There is also a factual dispute concerning whether there were efforts to standardize the content of BRAG or BRC websites during the relevant time period. See Pl. Mem. at 18-19; Reply Mem. at 6. Evidently, the launch of a "Bridge Project" website occurred after the jurisdictionally significant time period, but its planning phases was during the significant time period. Defendant claims that no part of the project was performed in Pennsylvania and no BRC employees were involved in any significant way. See Affidavit of Christoph Kainzbauer, BRAG employee ("Kainzbauer Aff."), Ex. B to Liederman Reply Aff., ¶ 5.
Pl. Mem. at 21.
However, the facts do not establish the pervasive structural relationship between the two organizations that plaintiffs hoped to find. BRC is a separate United States corporation and has no subsidiary, affiliate, or stock ownership relationship with BRAG. BRAG has no direct financial interest in BRC and all transfers between the two corporations are by sale. The head of the BRAG Management Board testified under oath that there is no direct relationship between BRC and BRAG and the two companies do not control or dictate one another's business. BRAG has no influence on: approving or firing BRC executives, the compensation of BRC employees, or handling service problems in the United States. BRAG has no veto power over any BRC decisions.
See Neuer Aff. ¶¶ 15-16.
See Def Mem. at 1; Neuer Aff. ¶ 13.
See 11/30/05 Interpreted Oral Deposition of Manfred Grundke, Head of the BRAG Management Board ("Grundke Dep."), Ex. G to Liederman Aff., at 102-03, 105.
See id. at 66.
See id. at 59.
See id. at 71.
See Defendant Bosch Rexroth AG's 11/20/02 Responses to Plaintiffs' First Set of Interrogatories as to Jurisdiction Directed to the Bosch Rexroth Defendants ("BRAG's 11/20/02 Interrogatory Response"), Ex. C to Liederman Aff. at 6.
Indeed, BRC appears to have complete fiscal independence from BRAG. The corporations maintain separate financial statements and bank accounts, and BRC plans, creates and establishes its own budgets and conducts its own financial planning. BRC does business with other companies and incorporates parts other than those produced by BRAG. BRC has developed its own technology and products. As a result of this financial independence, I am convinced that "BRC's economic success has been its own and has never inured to the economic benefit of BRAG. BRAG's economic benefit has only been derived indirectly where the success of BRC has continued to demand the supply of the component products."
See id. at 7.
See id. at 6.
See Reply Mem. at 2.
See Weber Aff. ¶¶ 5-6.
Reply Mem. at 10.
As this Court noted in 2002, plaintiffs have not shown that "were it not for the presence of BRC, Bosch Rexroth AG would be conducting its own activities in Pennsylvania. Rather, it appears from the evidence presented that Bosch Rexroth AG would simply hire another distributor for its products." Plaintiffs analogize the facts of this case to the parent-subsidiary relationships that have been held to justify general jurisdiction over the nonresident parents. But in fact it seems more similar to the cases of nonresident holding companies, where imputation of jurisdiction has been held improper because "the subsidiary is not performing a function that the parent would otherwise have had to perform itself (the holding company could simply hold another type of subsidiary)."
In re Ski Train Fire in Kaprun, Austria on November 11, 2000, 230 F. Supp. 2d at 402.
Gallagher v. Mazda Motor of Am., Inc., 781 F. Supp. 1079, 1085 (E.D. Pa. 1992) (citing Savin Corp., 661 F. Supp. at 471, Akzona Inc. v. E.I. Du Pont De Nemours Co., 607 F. Supp. 227, 237 (D. Del. 1984)).
Plaintiffs have also failed to establish that BRAG asserts day-to-day control over the activities of BRC. Indeed, where there is no evidence of direct control and the corporate formalities are separate and distinct, courts have refused to impute general jurisdiction. The fact that "the companies may have a close relationship or may coordinate and cooperate . . . is not sufficient to impute forum contacts."79
See, e.g., Arch, 984 F. Supp. 830 (finding that jurisdictional contacts of holding company's wholly owned subsidiary could not properly be imputed to holding company even though companies had an overlapping director, because separate corporate structures were maintained, subsidiary had substantial autonomy, and charges for goods and services between holding company and subsidiary were at prices applicable to arm's length transactions); Rose, 2001 WL 236738 (finding that sales, a consolidated annual report, and close cooperation were not sufficient to impute any forum contacts of BMW Group to BMW AG).
III. CONCLUSION
For the foregoing reasons, BRAG's motion to dismiss for lack of personal jurisdiction is denied. The Clerk of the Court is directed to close the motion [docket # 6]. A conference is scheduled for Tuesday, March 21, at 2 p.m.
SO ORDERED.