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EUGENE IOVINE, INC. v. RUDOX ENGINE & EQUIP. CO.

March 16, 1992

EUGENE IOVINE, INC., Plaintiff, against RUDOX ENGINE AND EQUIPMENT COMPANY, Defendant. RUDOX ENGINE AND EQUIPMENT COMPANY, Third-Party Plaintiff, -against- W.I. HORLICK COMPANY, INC., Third-Party Defendant.


The opinion of the court was delivered by: LEONARD D. WEXLER

 WEXLER, District Judge.

 In the above-referenced case, Eugene Iovine, Inc. ("Iovine"), the general contractor for the New York City Health and Hospital Corporation ("NYCH&HC") brought suit against Rudox Engine and Equipment Company ("Rudox") for breach of warranty based on Rudox's contract with Iovine to supply twenty-six motor generator sets to upgrade the elevators at Kings County Hospital, located in Brooklyn, New York. Subsequently, Rudox commenced a third-party action against W.I. Horlick Company, Inc. ("Horlick"), the assembler and supplier of the twenty-six motor generator sets, for indemnity and contribution. Presently before the Court is Horlick's motion to dismiss for lack of in personam jurisdiction pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure. For the reasons stated below, the motion is denied.

 I. BACKGROUND

 The following material facts are not in dispute. Iovine is a New York corporation having its principal place of business in East Farmingdale, New York; Rudox is a New Jersey corporation having its offices in Carlstadt, New Jersey; and Horlick is a Massachussetts corporation with offices in Boston and Randolph, Massachussetts.

 On or about July 31, 1984, Rudox was awarded a $ 162,320 contract by Iovine to provide twenty-six motor generator sets for Kings County Hospital. On or about August 3, 1984, Rudox, from its New Jersey office, sent to Horlick, at its Massachussetts office, a purchase order for the motor generator sets.

 Subsequently, Horlick forwarded submittals for the motor generator sets to Rudox for its review and approval. *fn1" These submittals were forwarded by Rudox to NYCH&HC which revised them in October, 1984 and then approved them on December 11, 1984. On or about October 21, 1985, Horlick notified Rudox that the motor generator sets were ready and four days later, Rudox, or its agent, picked them up from Horlick's Boston office.

 This Court can properly assert personal jurisdiction over Horlick, a non-domiciliary of New York, only if Horlick has (a) purposely availed itself of the benefits of doing business in New York and; (b) has sufficient minimum contacts with New York so that it can reasonably expect to be called to defend itself in New York. International Shoe Co. v. Washington, 326 U.S. 310, 316, 90 L. Ed. 95, 66 S. Ct. 154 (1945); Savin v. Ranier, 898 F.2d 304, 306 (2d Cir. 1990); Paine-Webber Inc. v. Westgate Group Inc., 748 F. Supp. 115, 118 (S.D.N.Y. 1990). Rudox cites the following as constituting the required minimum contacts: (1) Horlick is listed under "Motor Generator Sets" in The Thomas Register, a "Yellow Pages" type of advertising directory that is published in New York and distributed throughout the world; (2) Horlick assembled three motor generator sets for a New York customer of Rudox in 1978 or 1979 (Horlick maintains that its work was performed only in Massachussetts); (3) in 1990, Horlick sent a bill to Unisys Corp., in New York, in relation to a diesel generator set that Horlick had purchased from Rudox for Unisys; (4) Horlick "reached out" beyond Massachussetts and negotiated a contract with Rudox in New Jersey; (5) Horlick knew that its submittals would be sent by Rudox to engineers of the NYCH&HC in New York in order to obtain final approval of the contract; (6) Horlick knew that the motor generator sets purchased by Rudox were destined for the Kings County Hospital in New York; (7) on September 28 and 29, 1989, Paul Horlick, then the president of Horlick, went to New York for, and actively participated in, two meetings with NYCH&HC to discuss alleged problems with the motor generator sets. (Horlick contends that there was only one meeting, it lasted only 30 minutes, and Paul Horlick did not say a word).

 II. DISCUSSION

 In a third-party action, the district court must obtain personal jurisdiction over a third-party defendant before it can adjudicate the third-party claim. Coleman v. American Export Isbrandtsen Lines, Inc., 405 F.2d 250, 251-52 (2d Cir. 1968). This Court may assert personal jurisdiction over a non-resident in a diversity action only where a New York court would be able to assert such jurisdiction. See Marine Midland Bank, N.A. v. Miller, 664 F.2d 899, 901 (2d Cir. 1981); Rosenthal v. Warren, 475 F.2d 438, 440 (2d Cir.), cert. denied, 414 U.S. 856, 38 L. Ed. 2d 106, 94 S. Ct. 159 (1973). Consequently, this Court must look to New York's long-arm statute, CPLR §§ 301 and 302, to determine if personal jurisdiction can be asserted against Horlick. Pyramid Co. of Ithaca v. The Original Great American Chocolate Chip Cookie Co. Inc., 102 Misc. 2d 1056, 425 N.Y.S.2d 230, 231-32 (Sup. Ct. 1980).

 A. Legal Standard under CPLR § 302(a)(1)

 Rudox asserts that CPLR § 302(a)(1) confers this Court with jurisdiction over Horlick. *fn2" Section 302(a)(1) permits "a court [to] exercise jurisdiction over any non-domiciliary . . . who . . . transacts any business within the state or contracts anywhere to supply goods or services within the state." However, the claim against the non-domiciliary must arise from the same acts which form the basis for the allegation that the non-domiciliary is transacting business in New York. Hoffritz for Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55, 59 (2d Cir. 1985); Beacon Enterprises, Inc. v. Menzies, 715 F.2d 757, 764 (2d Cir. 1983); McGowan v. Smith, 52 N.Y.2d 268, 437 N.Y.S.2d 643, 645, 419 N.E.2d 321 (Ct. App. 1981). Furthermore, the Court must determine whether the non-domiciliary has engaged in purposeful activity in New York, thereby invoking the benefits and protections of New York law. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474, 85 L. Ed. 2d 528, 105 S. Ct. 2174 (1985); Hanson v. Denckla, 357 U.S. 235, 250-52, 2 L. Ed. 2d 1283, 78 S. Ct. 1228 (1958); Longines-Wittanauer Watch Co. v. Barnes & Reinecke, Inc., 15 N.Y.2d 443, 261 N.Y.S.2d 8, 13, 209 N.E.2d 68 (Ct. App.), cert. denied, 382 U.S. 905 (1965).

 Each case is unique and this Court must consider both the quantity and quality of Horlick's activities within New York that are related to the Rudox contract. Fiedler v. First City Nat. Bank of Houston, 807 F.2d 315, 317 (2d Cir. 1986) (quoting Sterling National Bank & Trust Co. of New York v. Fidelity Mortgage Investors, 510 F.2d 870, 873 (2d Cir. 1975)); Longines-Wittnauer Watch Co., 261 N.Y.S.2d at 19. Moreover, proof of a single transaction in New York could satisfy the requirements of § 302(a)(1). ...


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