The opinion of the court was delivered by: SPATT
The defendant, Castings USA, Inc. ("Castings" or the "defendant"), moves to dismiss the Complaint for lack of personal jurisdiction and improper venue, pursuant to Fed. R. Civ. P. 12(b)(2) and (3), respectively, or, in the alternative, to transfer the case to the United States District Court for the Eastern District of Arkansas, pursuant to 28 U.S.C. § 1404(a).
Castings is a corporation organized under the laws of the State of Arkansas, and is engaged in the business of manufacturing casting molds. Castings' principal place of business and corporate headquarters are located in Pine Bluffs, Arkansas. The plaintiff, Laumann Manufacturing Corporation ("Laumann" or the "plaintiff"), is a New York corporation located in the State of New York and is engaged in the business of manufacturing.
In April 1993, Laumann contacted five or six manufacturers throughout the country, including Castings, to obtain price quotations for the manufacture and sale of "arms" to Laumann in New York. The function of these "arms" is not clear from the parties' papers. The parts were to be shipped to New York to be used to fulfill a contract between Laumann and the Department of the Army of the United States Government.
The plaintiff sent to each of the bidding manufacturers a copy of the government design for the aforementioned part, as well as a list of the terms and conditions to govern the contract. According to the plaintiff, Castings submitted, by letter, on April 21, 1993, a quotation for consideration, and a list of terms applicable to any resulting agreement between the parties. Laumann placed an order with Castings by a Purchase Order dated May 21, 1993. According to the plaintiff, the parties negotiated the agreement at arm's length. Under the terms of the contract, Castings would manufacture 625 "arms," pattern number 12325801, and would fulfill the order in accordance with the terms set forth by both Laumann and Castings, therefore complying with the standards required by the Department of the Army. The parties agreed that the law of the State of New York would govern the contract.
In July 1993 Castings indicated that an error had been made with regard to the price of the aforementioned "arms." After additional negotiation by telephone and written correspondence between the parties, a subsequent agreement was reached where Laumann agreed to pay a higher price for the parts than originally quoted by Castings.
Subsequently, Laumann commenced this action by filing its complaint in November 1994 in the Supreme Court of the State of New York, Nassau County, alleging that Castings breached the terms of the contract. The defendant filed a Notice of Removal under 28 U.S.C. § 1446, based on diversity jurisdiction.
Castings filed the instant motion seeking to dismiss the complaint because the Court lacks personal jurisdiction over the defendant pursuant to Fed. R. Civ. P. 12(b)(2) and improper venue pursuant Fed. R. Civ. P. 12(b)(3) or, in the alternative, to transfer this matter to the United States District Court for the Eastern District of Arkansas. In support of its lack of personal jurisdiction argument, Castings enumerates a number of factors which indicate that Castings has virtually no contacts with the State of New York. Included in these factors are that Castings does not now, and has never: (1) had a place of business in the State of New York, (2) had any employees in the State of New York, (3) had a bank account or finances in the State of New York, (4) been licensed or registered to do business in New York, nor (5) attended any trade shows or conventions in New York.
With regard to the Rule 12(b)(3) motion for dismissal based on improper venue, the defendant articulates that the plaintiff has not satisfied the applicable venue statute, 28 U.S.C. § 1391. Castings does not reside in the Eastern District of New York; no substantial part of the events or omissions giving rise to the claim occurred in the district; Castings is not subject to personal jurisdiction in New York; and there is another district in which this action may be brought, the Eastern District of Arkansas.
In the alternative, the defendant Castings, pursuant to 28 U.S.C. § 1404(a), moves to have the action transferred to the Eastern District of Arkansas. Castings contends that the action could have been brought in the Eastern District of Arkansas, because, in Castings' view, the location of the operative events took place in Arkansas. Moreover, the increased level of convenience of the parties and witnesses, and the trial efficiencies of the respective courts' dockets, also warrants a transfer of venue.
A. PERSONAL JURISDICTION OVER DEFENDANT
Prior to discussing the issue presented by the instant motion, the court will set forth several general principles which apply to motions challenging personal jurisdiction. If the court relies on the pleadings and affidavits alone, the plaintiff need only make a prima facie showing of jurisdiction in order to defeat the motion to dismiss. Welinsky v. Resort of World D.N.V., 839 F.2d 928, 930 (2d Cir. 1988). Moreover, the pleadings and affidavits are construed in the light most favorable to the plaintiff, and all doubts are resolved in its favor. Cutco Indus., Inc. v. Naughton, 806 F.2d 361, 365 (2d Cir. 1986); Hoffritz for Cutlery, Inc. v. Amajac Ltd., 763 F.2d 55, 57 (2d Cir. 1985).
Personal jurisdiction over a defendant in a diversity action is determined by reference to the relevant statutes of the forum state. Amajac, 763 F.2d at 57. Under New York law, the court must follow a two-step procedure in order to determine whether there is personal jurisdiction over a defendant: (1) the Court must determine whether New York Civil Practice Law and Rules ("CPLR") sections 301 or 302 provide a basis for personal jurisdiction, and (2) if they do, the Court must then conduct a constitutional inquiry to determine whether the exercise of personal jurisdiction over the defendant would offend due process pursuant to International Shoe Company v. Washington, 326 U.S. 310, 66 S. Ct. 154, 90 L. Ed. 95 (1945), and its progeny. En Vogue Optical Ltd. v. UK Optical Ltd., 843 F. Supp. 838, 841 (E.D.N.Y. 1994).
Pursuant to CPLR section 301, the court may exercise general jurisdiction over a non-domiciliary based on the defendant's "presence" within the state. A defendant is present if he is found to be "doing business" in the state. Frummer v. Hilton Hotels, International, 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). "Doing Business" has been equated with a continuous an systematic course of business by a defendant in New York. Twine v. Levy, 746 F. Supp. 1202, 1204 (E.D.N.Y. 1990). A corporation that is licensed to do business in New York meets the criteria of "doing business" for purposes of personal jurisdiction under CPLR section 301. Augsbury Corp. v. Petrokey Corp., 97 A.D.2d 173, 175, 470 N.Y.S.2d 787, 789 (3d Dep't 1983).
In the instant case, the plaintiff does not assert that CPLR section 301 confers jurisdiction over the defendant, because Castings is neither licensed to do business in New York, nor does it conduct a continuous and systematic course of business in New York. Rather, the plaintiff argues that personal jurisdiction is conferred upon Castings pursuant to New York's Long-Arm statute, CPLR section 302(a)(1). That section provides that a non-domiciliary is subject to personal jurisdiction if it "transacts business within the state, or contracts anywhere to supply goods or ...