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STERLING TV PRESENTATIONS, INC. v. SHINTRON CO.

June 14, 1978

STERLING TELEVISION PRESENTATIONS, INC., Plaintiff,
v.
SHINTRON COMPANY, INC., Defendant



The opinion of the court was delivered by: BRODERICK

MEMORANDUM ORDER

 VINCENT L. BRODERICK, U.S.D.J.

 Defendant Shintron Co., Inc. ("Shintron") has moved for dismissal of the complaint pursuant to Fed.R.Civ.P. 12(b)2-5 on the grounds of lack of personal jurisdiction over the plaintiff, improper venue, insufficiency of process, and insufficiency of service of process. For the reasons hereafter stated, defendant's motion is denied.

 Plaintiff Sterling Television Presentations, Inc. ("Sterling") is a New York corporation with its principal place of business on Long Island, which designs, manufactures and sells electronic equipment, including typewriters, primarily in the field of video character generators. One of these "typewriters", the T1000A Studio Titling System ("T1000A") is the basis for this action. Sterling has copyrights on certain technical drawings related to the T1000A.

 Shintron is a Massachusetts corporation with its principal place of business in Cambridge, Massachusetts.

 On April 21, 1976 Sterling and Shintron entered into an exclusive marketing agreement (hereafter the "April 1976 agreement") by the terms of which Shintron became the exclusive retail marketing agent for the T1000A and Sterling ceased marketing the T1000A.

 Shintron began marketing the T1000A, renaming it the Shintron Model 505 Videotypewriter. During the autumn of 1976, Shintron fell behind in payments to Sterling under the April 1976 agreement and eventually the April 1976 agreement was terminated.

 On December 22, 1976 Sterling and Shintron entered into a new agreement (hereafter the "December 1976 agreement") under which defendant would market the T1000A on a non-exclusive basis. By the terms of this agreement, Sterling was to ship the typewriters directly to Shintron's retail customers and was to receive payments directly from the retail customers, crediting Shintron's account.

 In January 1977 Sterling sent to Shintron, at Shintron's request, a T1000A (Model 505) videotypewriter to use as a demonstrator. The parties performed under the December 1976 agreement until it was terminated in June 1977. Thereafter, Shintron commenced to manufacture and continued to sell the Model 505 videotypewriter.

 Sterling seeks an injunction ordering Shintron to cease the manufacture and sale of the Model 505 videotypewriter. Sterling claims that the manufacture and sale constitute breach of the April 1976 agreement, breach of a confidential relationship, and infringement of Sterling's copyright.

 Shintron has filed no answer to the complaint, but appears specially to contest personal jurisdiction, venue and service of process. While Sterling has moved for a preliminary injunction, that motion is being held in abeyance pending disposition of Shintron's motion to dismiss.

 Jurisdiction

 Personal jurisdiction over a foreign corporation is governed by the law of the forum state. Arrowsmith v. United Press International, 320 F.2d 219, 223 (2d Cir. 1963). Pursuant to N.Y. CPLR Section 302(a)(1), a foreign corporation is subject to suit in New York if it has transacted business within the state and the cause of action asserted arises out of the New York transaction of business. See Fontanetta v. American Board of Internal Medicine, 421 F.2d 355, 357-58 (2d Cir. 1970); Frummer v. Hilton Hotels Int'l., Inc., 19 N.Y.2d 533, 536, 281 N.Y.S.2d 41, 227 N.E.2d 851, cert. denied, 389 U.S. 923, 19 L. Ed. 2d 266, 88 S. Ct. 241 (1967); Herbert M. Wachtell, N.Y. Practice under the CPLR, (5th ed. 1976), p. 41. Thus, I must examine Shintron's transactions within New York and determine the issue of personal jurisdiction separately for each cause of action asserted in Sterling's complaint. See R.F.D. Group Limited v. Rubber Fabrications, Inc., 323 F. Supp. 521 (S.D.N.Y. 1971).

 Plaintiff bears the burden of proof in establishing personal jurisdiction over defendant. I shall make this determination on the pleadings and affidavits before me, Lynn v. Cohen, 359 F. Supp. 565, 566 (S.D.N.Y. 1973), which will be considered in the light most favorable to Sterling, the non-moving party. Freeman v. Gordon & Breach Science Publishers, Inc., 398 F. Supp. 519, 520 (S.D.N.Y. 1975).

 First cause of action. In the first cause of action Sterling charges Shintron with copyright infringement through Shintron's use in its brochures of certain drawings. The infringement allegedly occurred through unauthorized copying and distribution of the drawings. It is not clear whether Shintron copied the drawings or whether it wrongfully used drawings with which it had been supplied. These drawings were distributed in a manual which accompanied the Model 505 videotypewriter. Shintron shipped at least one videotypewriter to New York, to Sterling, although it was shipped F.O.B. Massachusetts.

 Mere shipment of merchandise to New York does not constitute transaction of business. Kramer v. Vogl, 17 N.Y.2d 27, 267 N.Y.S.2d 900, 215 N.E.2d 159 (1966).

 However, solicitation plus shipment does constitute a sufficient tie with the State of New York to warrant the finding of jurisdiction under CPLR Section 302(a)(1). See Singer v. Walker, 15 N.Y.2d 443, 261 N.Y.S.2d 8, 209 N.E.2d 68, cert. denied, sub nom. Estwing Mfg. Co. v. Singer, 382 U.S. 905, 15 L. Ed. 2d 158, 86 S. Ct. 241 (1965); and Buckley v. Redi-Bolt, Inc., 49 Misc. 2d 864, 268 N.Y.S.2d 653 (Sup. Ct. 1966) discussed in McLaughlin, James B., Practice Commentaries C.302:13 at p. 80 (McKinney 1972).

 Shintron demonstrated and displayed its products, including the manual, at an exposition in New York City during the second week of October 1977. The show was attended by Mr. Shintaro Asano, president of Shintron, and two Shintron salesmen. The purpose of exhibiting at the exposition was to solicit orders.

 Thus Shintron has engaged in purposeful activity within New York, enjoying the protection of the laws of the state. Longines-Wittnauer Watch Co. v. Barnes & Reinecke, Inc., 15 N.Y.2d 443, 261 N.Y.S.2d 8, 209 N.E.2d 68 (1965). I find that this court has personal ...


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