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October 10, 1991


The opinion of the court was delivered by: Sprizzo, District Judge:


Plaintiff ICC Primex Plastics Corp. ("Primex") brings this action against defendants LA/ES Laminati Estrusi Termoplastici S.P.A. ("LA/ES"), CO-EX Corporation ("CO-EX") and individual defendant Cosimo Conterno. The action stems from a failed joint venture allegedly entered into by Primex and LA/ES, and includes allegations that the defendants breached their obligations under a letter of intent to form the joint venture, misappropriated information provided to them by the plaintiff and used that information for their own purposes in derogation of a fiduciary duty, interfered with Primex`s business opportunities, and breached fiduciary duties owed to the plaintiff. All defendants move to dismiss the action for lack of personal jurisdiction, Fed.R.Civ.P. 12(b)(2), or for a transfer to the District of Connecticut. 28 U.S.C. § 1404(a). The Court has held a hearing and considered all of the testimony and exhibits submitted by the parties and, for the reasons that follow, the motions to dismiss are granted.*fn1 The following constitutes the Court`s findings of fact and conclusions of law pursuant to Fed.R.Civ.P. 52(a).


LA/ES is an Italian Corporation engaged in the business of acetate sheet production for the optical industry. See Transcript of Hearing ("Tr.") at 43. Its main office is in Italy and it has no offices or sales personnel in the State of New York. See Tr. 44. LA/ES's sales representatives solicit business throughout the world and the United States, including the State of New York, primarily by mail and telephone from Italy. See Defendant`s Response to Plaintiff`s Interrogatories No. 9 ("Int.") (annexed to Affidavit of Karin Schlosser ("Schlosser Aff.") at Ex. 14). Those representatives have made sales calls upon customers in New York on occasion, and have attended some trade shows in New York. See Tr. 47; Int. No. 9. Moreover, in addition to the sales representatives located in Italy, LA/ES presently has a sales agent located in Connecticut, Roland Optical Co., which receives a commission on its sales.*fn2 See Tr. 47. LA/ES also has a number of customers in New York and received gross revenue of $404,130.00 from sales to New York customers between June 1, 1987 and August 1990. See Int. No. 56 & Schedule C.

Individual defendant Cosimo Conterno is an Italian citizen residing in Switzerland. See Tr. 43. He is the chief executive officer of both LA/ES and Estrusione Materie Plastiche, S.A. ("EMP"), a Swiss corporation which manufactures extrusion polycarbonate thin wall sheet. See id. Conterno does not maintain any offices or residences in New York, but he has travelled to New York and continues to travel to Connecticut from time to time for business reasons. See Tr. 44; Affidavit of Cosimo Conterno at ¶ 14 (July 31, 1990) ("Conterno Aff. I"); Int. No. 61-68.

In late 1987, Conterno and LA/ES entered into discussions with Primex regarding the possibility of forming a joint venture for the production and distribution in the United States of polycarbonate wall sheets, which are typically used in the construction of greenhouses. See Tr. 19-20, 44-47, 100-03. These discussions included trips by plaintiff`s representatives Murray Aibinder and Paul Bertsch to Italy to meet with Conterno and inspect LA/ES` plants, see Tr. 45-46, 100, 136, and visits by Conterno to Primex`s offices in Indiana and New Jersey. See Tr. 46; Conterno Aff. I at ¶ 4. In addition, LA/ES and Conterno furnished technical materials and other data to Primex. See Tr. 46-47, 133, 143-45.

These preliminary discussions resulted in the execution of a letter of intent on January 12, 1988. See Schlosser Aff. at Ex. 1. The letter of intent contemplated three stages leading to the formation of the joint venture: (1) the parties would explore the feasibility of the project, with Primex responsible for the investigation of the cost and feasibility of marketing, distribution, and manufacturing the product in the United States and LA/ES and Conterno responsible for negotiations with suppliers of resin, a raw material necessary for production; (2) the parties would form a corporation which would market in the United States polycarbonate sheets manufactured in Europe for six months; and (3) if the marketing experiment phase proved successful, the company would thereafter begin to manufacture as well as distribute the product in the United States. See Schlosser Aff. at Ex. 1; see Tr. 101-104. The evidence at the hearing established that the most critical prerequisite for the success of the joint venture was the success of Conterno`s efforts to obtain a global contract for raw materials, such as the resin necessary to manufacture the product. See Tr. 76, 102-05, 120-22; Defendant`s Memorandum of Law in Support of Motion to Dismiss at Ex. B (letter from John Farber to Cosimo Conterno (March 8, 1988)). However, although Conterno had discussions with some suppliers and visited one in May, 1988 in Michigan, he was not able to obtain such a contract. See Schlosser Aff. at Ex. 2 (letter from C. Conterno to M. Aibinder (Aug. 24, 1988)).

While Conterno was endeavoring to obtain the contract, Primex spoke to a number of sales representatives and requested that one of those firms, Polymark, Inc. ("Polymark") make a presentation to the joint venture partners. The principals of Polymark were David Bilhorn, Byron Roderick, and Leo Carter. A meeting was held at Primex`s offices in New York on May 18, 1988,*fn3 the major purpose of which was to introduce the Polymark representatives to Conterno. See Tr. 49-54, 63-64, 71-74, 107-08, 138-41; Affidavit of Murray Aibinder at ¶ 17. Following their presentation, which Conterno criticized as overly "optimistic," Tr. 55, 74, Aibinder and Conterno decided to offer the position to Bilhorn and Roderick, but not Carter. See Tr. 75-76, 109-10; Affidavit of David Bilhorn ("Bilhorn Aff.") at ¶ 8. Polymark rejected that offer. See Tr. 60, 68, 109-10; Bilhorn Aff. at ¶ 8. Moreover, although Aibinder had some discussions with Polymark after the meeting, he was not successful in persuading Polymark to accept the position as sales representatives on the basis offered by Aibinder and Conterno. See Tr. 115-17.

Other matters were also discussed at the meeting, including product specifications, commercial considerations, and the need for a favorable contract for raw materials. See Tr. 107. At the end of the meeting, it was agreed that Aibinder would draft the joint venture agreement, and that Conterno would provide more technical information to Primex and continue to try to obtain the necessary contract for the raw materials. See Tr. 111-12.

However, unbeknownst to Aibinder, after Polymark rejected the offer made by Primex and LA/ES, David Bilhorn contacted Conterno to inquire if LA/ES would be interested in exporting its products to the United States and marketing them through Polymark. See Tr. 59; Affidavit of Cosimo Conterno at ¶ 4 (Dec. 28, 1990) ("Conterno Aff. II"); Bilhorn Aff. at ¶ 9. Since he had been thus far unable to obtain a price concession on the raw materials and since he felt that Primex had no independent knowledge of the marketplace, Conterno decided to investigate the possibility of a business relationship with Polymark. See Tr. 59, 69, 84-86; Conterno Aff. II at ¶¶ 4-5. He asked Ian Jeremy Baines to speak to Bilhorn. See Tr. 10-12, 69, 85-86. Baines reported to Conterno that he thought that Bilhorn was knowledgeable about the business. See Tr. 14. Thereafter, Baines and Conterno decided to form a company to market polycarbonate structured sheets in the United States and to hire Bilhorn as a salesman. See Tr. 14-15, 70.

The company they formed in September 1988 was defendant CO-EX Corporation.*fn4 CO-EX is a Connecticut corporation and has its principal place of business there. See Tr. 91. It has no offices or employees in New York, see Tr. 91-92, but it does solicit business in the state by mail and telephone. See Tr. 3-4. Its representatives, including Bilhorn,*fn5 also have attended trade shows and made occasional sales calls upon New York customers. See Tr. 4-5, 10, 16-17, 29. Moreover, CO-EX presently sells products to potential customers in New York through a representative in New Jersey, whose sales must be approved by CO-EX. See Tr. 92, 95-96.

The evidence further demonstrated that CO-EX's sales to New York customers between August 1988 and June 1990 totalled approximately $120,000 and constituted approximately 10% of CO-EX's business. See Tr. 18; Schlosser Aff. at Exs. 9, 10, 11. In addition, CO-EX sometimes provides its customers with promotional material seeking to have them persuade their customers to purchase its product, however, none of CO-EX's customers have any authority to bind CO-EX. See Tr. 24-26. Nor did CO-EX have any control over the manner or means by which its customers resold its product. See Tr. 21, 24-27, 31-32.


Plaintiff first argues that CO-EX and LA/ES are subject to personal jurisdiction because those companies are "doing business" in New York State. Under N.Y.Civ.Prac.L. & R. ("CPLR") 301 (McKinney 1990), a court may exercise personal jurisdiction over a defendant on any cause of action where the defendant is "`engaged in such a continuous and systematic course of "doing business" here as to warrant a finding of its "presence" in this jurisdiction.`" Landoil Resources Corp. v. Alexander & Alexander Servs. Inc., 918 F.2d 1039, 1043 (2d Cir. 1990) (quoting McGowan v. Smith, 52 N.Y.2d 268, 272, 419 N.E.2d 321, 323, 437 N.Y.S.2d 643, 645 (1981)). In applying this test, New York courts have consistently held that the solicitation of business alone will not justify the exercise of general personal jurisdiction over defendant. See Landoil Resources, supra, 918 F.2d at 1043; Laufer v. Ostrow, 55 N.Y.2d 305, 310, 434 N.E.2d ...

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