Corp. v. Axiom Medical, Inc., 600 F. Supp. 731, 734 (E.D.N.Y. 1985) (finding jurisdiction for declaratory judgment cause of action, but not for unfair competition and unjust enrichment causes of action) (citing Sterling Television Presentations v. Shintron, 454 F. Supp. 183 (S.D.N.Y. 1978)). See also Darby Drug Company, Inc. v. Zlotnick, 573 F. Supp. 661 (E.D.N.Y. 1983); R.F.D. Group Ltd. v. Rubber Fabricators, Inc., 323 F. Supp. 521 (S.D.N.Y. 1971).
A. General Jurisdiction Under Section 301
Section 301 confers general jurisdiction over any foreign corporation "doing business" within the jurisdiction, regardless of whether the cause arises out of that transaction or business. Laufer v. Ostrow, 55 N.Y.2d 305, 434 N.E.2d 692, 696, 449 N.Y.S.2d 456, 460 (1982). To be "doing business," "a defendant must be 'engaged in such a systematic and continuous course of doing business here as to warrant a finding of its 'presence' in this jurisdiction.'" Kash ' N Gold, Ltd. v. ATSPI, Inc., 690 F. Supp. 1160, 1162 (E.D.N.Y. 1988) (quoting Laufer, 434 N.E.2d at 695, 449 N.Y.S.2d at 458. To support general jurisdiction, New York courts require substantial solicitation that is carried on with a considerable measure of continuity and from a permanent locale within the state. Beacon Enterprises Inc. v. Menzies, 715 F.2d 757, 763 (2d Cir. 1983).
For purposes of section 301, Riviera has not met its burden of demonstrating that Oakley is "doing business" in New York State. Oakley has no property, offices, warehouses, employees, bank accounts or telephone listings within the State of New York. See Kash ' N Gold, 690 F. Supp. at 1162. Oakley products are sold to consumers in New York State but are sold through retail outlets that purchase Oakley products from Oakley headquarters in Irvine, California. Sales to retailers are governed by Oakley's "Retail Standards Agreement" that specifically provides that it is to be performed in Irvine, California. In 1995, sales of Oakley products to New York State constituted only 1.9% of Oakley's domestic sales and 1.4% of Oakley's total sales. See Transistor Devices, Inc. v. Tracor, Inc., 654 F. Supp. 601, 603-04 (E.D.N.Y. 1987).
Oakley's sunglasses are sold at numerous retail outlets in New York, including the chain called Sunglass Hut. Oakley sales are solicited primarily by way of telephone contact, by in-house territorial manager employees. Oakley uses outside sales representatives, including several residing in New York, to service the authorized retail accounts that reside in the State of New York, but they are independent contractors, and not employed by Oakley. Oakley has no control over the manner in which they conduct their services for Oakley and the representatives have no authority to bind Oakley in contract or to open new account locations.
Under New York law, Oakley does not do business in New York for purposes of section 301. "The shipment of goods into New York does not ipso facto constitute 'doing business.'" Beacon Enterprises, 715 F.2d at 763 (citing Loria & Weinhaus, Inc. v. H.R. Kaminsky & Sons, Inc., 495 F. Supp. 253, 257 (S.D.N.Y. 1980). "No court has ever held that the maintenance of even a substantial sales force within the state is a sufficient contact to assert jurisdiction in an unrelated cause of action." Congoleum Corp. v. DLW Aktiengesellschaft, 729 F.2d 1240, 1242 (9th Cir. 1984). "It is not enough that an independent contractor is present in New York, systematically soliciting business for the corporation," Artemide SpA v. Grandlite Design and Mfg. Co., Ltd., 672 F. Supp. 698, 703 (S.D.N.Y. 1987), no matter how substantial the orders. Id. (citing Miller v. Surf Properties, Inc., 4 N.Y.2d 475, 176 N.Y.S.2d 318, 151 N.E.2d 874 (1958), Laufer v. Ostrow, 55 N.Y.2d 305, 449 N.Y.S.2d 456, 459, 434 N.E.2d 692 (1982) and Delagi v. Volkswagenwerk, 29 N.Y.2d 426, 433, 328 N.Y.S.2d 653, 657 278 N.E.2d 895, 898 (1972).
The cases relied upon by Riviera, Landoil Resources Corp. v. Alexander & Alexander Services, Inc., 918 F.2d 1039 (2d Cir. 1990), and Aquascutum of London, Inc. v. SS American Champion, 426 F.2d 205 (2d Cir. 1970), are not persuasive authorities in support of finding jurisdiction here. In Landoil, the Court found that New York did not have personal jurisdiction over the Defendant. The Court held that sales consisting of only 2% of total income in New York would not in and of itself confer jurisdiction, 918 F.2d at 1044, and that for the "solicitation plus" rule to apply, "a Defendant's presence in New York in addition to solicitations must amount to more than 'paying persons to perform essentially mechanical tasks for it.'" Id. at 1045.
Likewise, in Aquascutum, the Court found that it could not exercise jurisdiction over a foreign freight forwarder defendant that did not solicit shipment in New York, but did make shipments to New York. The Court found important the defendant's representation in the state by independent contractors rather than employees. Aquascutum of London, 426 F.2d at 211.
In sum, Riviera has not met its burden of demonstrating that Oakley has a presence in the state sufficient to confer jurisdiction pursuant to section 301 over causes of action not relating to the business conducted in New York.
B. Specific Jurisdiction Under Section 302
Riviera also alleges personal jurisdiction pursuant to Section 302(a)(2), which provides, in relevant part:
[A] court may exercise personal jurisdiction over any nondomiciliary . . . who in person or through an agent:
2. commits a tortious act within the state . . .;