Summary
holding that nonresident defendant's website with hotel reservation system did not constitute "transacting business" such that it was subject to specific personal jurisdiction in New York
Summary of this case from Pascarelli v. KoehlerOpinion
No. 00 Civ. 6559 (GEL).
January 9, 2001.
Richard Mandel, Virag Virag, Esqs., New York, N.Y. for Plaintiff Franciso Rodriguez.
Sheryl M. Schwartz, Herold and Haines, P.A., New York, N.Y. for Defendants Circus Circus Casinos and Slots-A-Fun Inc.
OPINION AND ORDER
Plaintiff Francisco Rodriguez, a resident of New York, brings this action for personal injuries against defendants Circus Circus Casinos, Inc. ("CCC") and Slots-A-Fun, Inc. ("Slots"), two Nevada corporations. Rodriguez claims that he suffered a head injury requiring emergency medical care after a fall in a Las Vegas casino, due to negligence on the part of defendants, who allegedly owned and operated the casino. Subsequent treatment and diagnosis in New York apparently revealed the onset of various neurological complications. The action is now before this Court on the defendants' motion to dismiss for lack of personal jurisdiction. After careful consideration of the submissions of the parties, the motion is granted.
DISCUSSION
Personal jurisdiction over a non-resident in a diversity case is determined by the law of the jurisdiction in which the federal court sits. Bensusan Restaurant Corp. v. King, 126 F.3d 25, 27 (2d Cir. 1997). New York law authorizes courts to exercise either general or long-arm jurisdiction over non-resident defendants. See C.P.L.R 301 (general jurisdiction), 302(a) (long-arm jurisdiction). A foreign corporation is subject to general jurisdiction if it engages in a systematic and continuous course of doing business in New York, so as to warrant a finding of its presence. Beacon Enterprises Inc. v. Menzies, 715 F.2d 757, 762 (2d Cir. 1983); Frummer v. Hilton Hotels Int'l, Inc. 19 N.Y.2d 533, 536 (1967). Such a systematic and continuous course of doing business may be established where, for example, a corporation has bank accounts, assets, offices, employees or agents in the State of New York. See Mareno v. Rowe, 910 F.2d 1043, 1046 (2d Cir. 1990); see also Frummer, 19 N.Y.2d at 537 (noting that the "pivotal factor" is whether the New York agent "does all the business which the [non-resident corporation] could do were it here by its own officials"). Long-arm jurisdiction is appropriate, even in the absence of continuous and systmatic conduct, where a plaintiff's cause of action arose from, inter alia, (1) business transacted within the state (2) a tortious act committed within the state, or (3) a tortious act committed outside of the state, resulting in an injury within the state, See C.P.L.R. 302(a)(1)-(3); Kreutter v. McFadden Oil Corp., 71 N.Y.2d 460, 467 (1988) (describing § 302 as a "single act" statute).
There is clearly neither general nor long-arm jurisdiction over Slots. Slots displays none of the indicia of systematic and continuous business conduct necessary to subject it to general jurisdiction in New York. Slots is a Nevada Corporation with its principal place of business in Las Vegas. It is not licensed, nor does it do any business, in New York. It has no telephone listings, bank accounts, assets, offices, employees or agents in the State of New York. Even if Slots solicited business in New York, and the record does not establish that it does, solicitation alone is insufficient to subject a foreign corporation to general jurisdiction in New York. See Laufer v. Ostrow, 55 N.Y.2d 305, 310 (1982).
Nor is there long-arm jurisdiction over Slots. No "transaction" involving Slots occurred in New York. At any rate, this is a claim for personal injuries resulting from the defendants' tortious conduct, and the tortious conduct alleged, negligent management and operation of a casino, occurred in Las Vegas, not New York. Nor is this a case where tortious conduct in Nevada caused injury in New York. Although the full extent of Rodriguez's injuries only became evident once the he had returned to New York, any injuries he suffered were effected in Las Vegas. Damages suffered within New York do not furnish the predicate injury for long-arm jurisdiction under C.P.L.R. 302(a)(3). See Mareno, 910 F.2d at 1046 (suffering a financial loss in New York does not satisfy requirement that injury be caused within New York); Ditchek v. Baines, 665 F. Supp. 350, 351 (S.D.N.Y. 1987) ("Section 302(a)(3) CPLR. looks to the imparting of the original injury within the state of New York and not the resultant damage, in order that jurisdiction might be effectuated."). Consequently, this action must be dismissed against Slots for lack of personal jurisdiction.
Most likely, dismissal of this action against Slots effectively disposes of the present case, since it apparently managed and operated the casino where the events in controversy occurred. But Rodriguez has also sued a related corporate entity, CCC. Although it is unclear how CCC is claimed to be liable for Rodriguez's injuries, the merits of this action against CCC cannot be addressed unless the Court has jurisdiction over it. Had Rodriguez relied upon the same bases for asserting personal jurisdiction over both Slots and CCC, there would be nothing left to resolve. As to CCC, however, Rodriguez claims an additional basis for jurisdiction, pointing out that CCC operates a website that is accessible in New York, through which it is possible to make hotel reservations, and that operation of this website constitutes either "doing business," or at least "transacting business" in New York in satisfaction of the statutory requirements. Neither logic nor legal authority supports this conclusion.
Rodriguez argues that an internet-based reservation system constitutes a "virtual office" in New York. However innovative the internet may be as a means of commerce, its use for booking hotel rooms does not present any novel legal issues with respect to personal jurisdiction. CCC's operation of the website in question does not constitute "doing business" in New York for the purposes of establishing general jurisdiction. For jurisdictional purposes, there is no material difference between using the internet to make a reservation with an out-of-state entity and placing a telephone call to that entity for the same purpose. Existing case law establishes that the ability of a New York resident to make a telephone reservation with an out-of-state hotel cannot alone make that hotel subject to general jurisdiction in New York. See Tripmasters. Inc. v. Hyatt Int'l Corp., 696 F. Supp. 925, 933 n. 8 (S.D.N.Y. 1988) (listing of toll free number for reservation in New York is "mere solicitation" insufficient to establish general jurisdiction); Ziperman v. Frontier Hotel of Las Vegas, 374 N.Y.S.2d 697, 700 (2d Dep't 1975) (foreign hotel's solicitation of guests by listing a toll-free direct-line telephone number in local telephone directory was insufficient to establish general jurisdiction). Cf. Frummer, 19 N.Y.2d at 537 (general jurisdiction over foreign hotel only exists if there is a reservation agent in New York who does not have to confirm reservations with the hotel). Similarly, the accessibility of CCC's website to New York residents (and their ability to make a reservation through it) cannot be sufficient to establish general jurisdiction over CCC. This conclusion is in accord with the developing case law on the subject. See Cornell v. Assicurazioni Generale Consol., 97 Civ. 2262, 98 Civ. 9186, 2000 WL 284222, at *2 (S.D.N.Y. March 16, 2000) ("A firm does not `do business' in New York simply because New York citizens can contact the firm via the worldwide web."); Hearst Corp. v. Goldberger, 96 Civ. 3620, 1997 WL 97097, at *8 (S.D.N.Y. Feb. 26, 1997) (contact via the worldwide web and email alone do not satisfy "doing business" standard required for general jursidiction). Plaintiff cites no contrary authority.
For the same reasons, CCC's operation of its website does not amount to "transacting business" under the long-arm statute. Even if it did, that would not help Rodriguez. Under New York law, long-arm jurisdiction may be based on transitory business dealings, and even on a single transaction — but only if the cause of action arises from the transaction itself. See Kreutter, 71 N.Y.2d at 467; McGowan v. Smith, 52 N.Y.2d 268, 273 (1981). Even if Rodriguez had made his hotel reservation over CCC's website — and it is not alleged that he did — the personal injuries at the heart of this lawsuit arose, if at all, from the allegedly negligent conduct of the defendants in Nevada rather than from the making of a hotel reservation. Absent the requisite nexus, there is no basis for long-arm jurisdiction over CCC.
The mere fact that CCC maintained a website accessible in New York cannot by itself establish personal jurisdiction over CCC, and therefore this action must be dismissed against it as well.
CONCLUSION
For the foregoing reasons, the defendants' motion to dismiss for lack of personal jurisdiction is granted.
SO ORDERED: