The opinion of the court was delivered by: PLATT
In this diversity action for breach of contract and conversion, defendants, citizens of Ohio move pursuant to Rule 12(b)(2) and (5) of the Federal Rules of Civil Procedure for dismissal on the ground that this Court lacks in personam jurisdiction, and on the related ground that dismissal is mandated by Rule 12(b)(5) because of insufficiency of service of process.
Plaintiff Moser, a citizen of New York, was the owner of a herd of pure bred registered Aberdeen-Angus cattle. His herd was originally maintained at the Black Watch farms.
In or about September 1970 Black Watch Inc. filed Chapter 11 proceedings in the Southern District of New York. At that time, defendants, Bill and Ellen Boatman, mailed a four-page form letter to Moser in New York, outlining, in detail, the services that their Rolling Ridge Ranch could provide. There is no dispute as to this solicitation, but conflicts arose as to the succeeding events where defendants and defendants' alleged agent were present in the State of New York.
Plaintiff's affidavit (Garber) indicates that in October 1970, a meeting took place in the Sheraton Inn at LaGuardia Airport between defendants Bill and Ellen Boatman, Mr. William Brown (the Boatmans' attorney), Mr. Roger Mesecher (the Boatmans' Administrative Assistant) and Harry Garber, attorney for seventeen herd owners, including plaintiff Moser. According to Mr. Garber, terms of an agreement between the herd owners and Boatman were discussed; however, there is no mention of the length or outcome of the meeting. Shortly thereafter, another meeting took place at the same Sheraton Inn. Present was Bill Boatman, along with his ranch office manager, Mr. James Cawley, Mr. Garber and the herd owners. The basic agreement was reached at this meeting except for some subsequent revisions. The contract was then prepared by the Boatmans' attorney in Ohio, forwarded to New York for the herd owners' signatures and was thereafter executed by the Boatmans in Ohio.
The foregoing two occasions were the only instances that the Boatmans were present in New York. However, plaintiff's affidavit refers to three occasions in March, April and May 1971 where an alleged agent for the Boatmans, one John King, was in New York City to discuss a possible assignment of the original agreement to a new corporation, the Forty-one Cattle Company, an Ohio corporation. This assignment agreement was signed by plaintiff on May 24, 1971.
Defendant Bill Boatman's affidavit disputes the Garber description of the two meetings at LaGuardia Airport. According to him, they were "brief meetings" where defendant Boatman merely "outlined the services he could provide." He concludes that all negotiations concerning the agreement occurred in Ohio. Further, he denies plaintiff's allegation that King was his agent, when King made his three visits to New York.
The relevant statute here is New York's so-called "long arm" statute, CPLR Section 302, the pertinent part of which provides that
"§ 302. Personal jurisdiction by acts of non-domiciliaries
(a) Acts which are the basis of jurisdiction. As to a cause of action arising from any of the acts enumerated in this section, a court may exercise personal jurisdiction over any nondomiciliary, or his executor or administrator, who in person or through an agent:
1. transacts any business within the state;"
The basis for the New York "long arm" statute was the line of Supreme Court decisions beginning with International Shoe v. State of Washington, 326 U.S. 310, 66 S. Ct. 154, 90 L. Ed. 95 (1945). There the Court established the "minimum contacts" theory for establishing jurisdiction over a foreign corporation. After this decision it was no longer essential that the foreign corporation "consent" to jurisdiction or be "doing business" within the forum state. Due process "requires only that in order to subject a defendant to a judgment in personam, . . . he have certain minimal contacts with it, such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.'" 326 U.S. at 316, 66 S. Ct. at 158.
International Shoe was extended even further in McGee v. International Life Insurance Co., 355 U.S. 220, 78 S. Ct. 199, 2 L. Ed. 2d 223 (1957) where jurisdiction was allowed over an insurance company with no office or agent in California, which had never solicited business there and whose only contact was the writing of the policy. The critical factor was that "the suit was based on a contract ...