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DOMOND v. GREAT AMERICAN RECREATION

September 15, 2000

MARIE DOMOND AND JEAN DOMOND, PLAINTIFFS,
V.
GREAT AMERICAN RECREATION, INC., AND VERNON VALLEY RECREATION ASSOCIATION, INC., DEFENDANTS.



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

MEMORANDUM OF DECISION AND ORDER

This diversity case involves claims that Plaintiff Marie Domond sustained personal injuries allegedly caused by the Defendants negligence while the Plaintiffs were attending the Defendants amusement park in New Jersey. Presently before the Court are the Defendants' motions to vacate the default judgment previously entered against them, to dismiss the complaint for lack of personal jurisdiction, and to have the case transferred to the District of New Jersey.

BACKGROUND

Unless otherwise indicated, the following facts are taken from the plaintiffs complaint. Because the Defendants' motion to dismiss is based upon an alleged lack of personal jurisdiction under Fed. R. Civ. P. 12(b)(2), the Court will also consider the various affidavits submitted by the parties on that issue. See Ball v. Metallurgie Hoboken-Overpelt, S.A., 902 F.2d 194, 196-98 (2d Cir. 1990).

Marie Domond ("Marie") and Jean Domond ("Jean") are residents of New York State. Great American Recreation, Inc., and Vernon Valley Recreation Association, Inc., (collectively, "Great American") are New Jersey corporations. According to the complaint, Great American's principal place of business is "outside of New York," although the complaint does not specifically state where.

On August 17, 1995 the Plaintiffs paid the required admission to Action Park, an amusement park owned and operated by Great American in Vernon, New Jersey. They allege that, while on a ride called the "Aqua Skoot," Marie fell backwards and struck her head on metal rollers that make up the ride, causing her serious injuries.

On April 2, 1996, Great American filed for bankruptcy in the United States Bankruptcy Court, District of New Jersey. On November 20, 1996, The Plaintiffs commenced this action alleging negligence on behalf of Marie and a claim for loss of services by Jean. Because Great American was in bankruptcy at the time, the Plaintiffs' action was automatically stayed pursuant to 11 U.S.C. § 362.

In September, 1997, as a consequence of the bankruptcy proceeding, the Defendants were merged into a new entity known as GAR, Inc., which was formed in part to resolve existing claims against them that arose prior to the bankruptcy filing.

On December 16, 1996, United States Bankruptcy Judge Novalyn L. Winfield directed the parties to proceed to mediation on the Plaintiffs' claims. Between January 8, 1997 and July 6, 1998, the Plaintiffs made four written requests to Great American Recreation, Inc.; Skadden, Arps, Slate, Meagher, & Flom LLP, Great American's counsel; and Evanston Insurance Company to schedule the court-ordered mediation. Great American's only response to the Plaintiffs' correspondence was a settlement offer made by Michael Sangalli, the Vice President & CFO of Great American Recreation, Inc., on July 11, 1997.

On July 6, 1998 the Bankruptcy Court granted the Plaintiffs' motion to terminate the automatic stay as it related to this action. On July 15, 1998 and August 6, 1998 the Plaintiffs sent letters to Great American Recreation; its counsel; and Robert Drexel, Esq. of GAR, Inc., advising them of the pending lawsuit and demanding that the Great American file an answer. Great American nevertheless did not respond to the complaint. On November 4, 1998, this Court heard oral argument on the Plaintiffs' motion for a default judgment. Although Mr. Drexel, counsel for GAR, Inc. appeared at this time, no objection was made to the relief requested by the Plaintiffs, and on November 9, 1998 a default judgment was ordered on the issue of liability.

Great American now moves to vacate the November 9, 1998 default under Fed. R. Civ. P. 60(b) on the grounds that confusion resulting from the bankruptcy proceedings over who was to represent Great American and that there was a dispute over whether the Plaintiffs' claims were covered by insurance which caused the default. In addition, Great American argues that this Court lacks personal jurisdiction over it, and that the complaint should be dismissed pursuant to Fed. R. Civ. P. 12(b)(2) or, in the alternative, the case should be transferred to the District of New Jersey.

I. DISCUSSION

A. As to Personal Jurisdiction over Great American

The Court's first consideration in this case is whether personal jurisdiction exists over Great American in New York. In a 12(b)(2) motion the plaintiff bears the burden of demonstrating that the court has jurisdiction over the defendant. See Bank Brussels Lambert v. Fiddler Gonzalez & Rodriguez, 171 F.3d 779, 784 (2d Cir. 1999); Kernan v. Kurz-Hastings, Inc., 175 F.3d 236, 240 (2d Cir. 1999), citing Metropolitan Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 566 (2d Cir. 1996). If the court relies on pleadings and the affidavits alone, the plaintiff is only required to make a prima facie showing of jurisdiction, including an averment of facts that, if credited by the ultimate trier of fact, sufficiently establishes jurisdiction over the defendants. See Kernan v. Kurz-Hastings, Inc., 175 F.3d 236, 240 (2d Cir. 1999); Jazini v. Nissan Motor Co. Ltd., 148 F.3d 181, 184 (2d ...


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