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SAS GROUP, INC. v. WORLDWIDE INVENTIONS

February 13, 2003

SAS GROUP, INC. PLAINTIFF,
v.
WORLDWIDE INVENTIONS, INC. DEFENDANTS.



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

MEMORANDUM DECISION AND ORDER

Plaintiff SAS Group, Inc. ("SAS") brought this suit in diversity against defendant Worldwide Inventions, Inc. ("Worldwide") for breach of contract, unjust enrichment, and fraud and misrepresentation. Worldwide moved for dismissal pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure, for lack of personal jurisdiction.

This court held an evidentiary hearing on January 23, 2003, after which plaintiff moved to dismiss voluntarily its third cause of action for fraud and misrepresentation. Since Worldwide has neither filed an answer nor opposed SAS's motion to dismiss its third cause of action, SAS is entitled to dismissal of its claim pursuant to Rule 41(a)(1)(i) of the Federal Rules of Civil Procedure. As a result, only Worldwide's motion to dismiss SAS's breach of contract and unjust enrichment claims remains for consideration.

For the following reasons, Worldwide's motion is denied.

FACTS

The following discussion represents the court's findings of fact relevant to disposition of the motion.

Worldwide is a Florida corporation that finds and develops new products, and either licenses the products to others or manufactures the products itself. [Bart Test., Hr'g Tr. 4]. SAS is a New York corporation that markets products to mass merchandisers, retail chains, and stores throughout the United States and overseas, as well as on direct response television. [Amended Compl. ¶ 7].

In May of 2001, Worldwide's president and vice president, Mitchell Garfinkel and Philip Bart, traveled to New York in order to meet with Michael Sobo, the president of SAS. [Bart Test., Hr'g Tr. 15]. The purpose of the visit was to try and license or sell its goods to SAS.*fn1 Id. at 18. The two companies had no business relationship prior to that time. [Garfinkel Aff. 6]. In fact, Sobo had never heard of Worldwide prior to May of 2001. [Sobo Test., Hr'g Tr. 40].

Bart and Garfinkel visited SAS at its corporate headquarters in Tarrytown, New York. [Bart Test., Hr'g Tr. 7]. They brought at least three sample products to the meeting — a "walking dog," a radio-controlled "motor ball," and "slap wraps" — and they demonstrated how the products worked.*fn2 Id. at 8-10.

Sobo did not express interest in any of Worldwide's products other than the "slap wraps." [Sobo Test., Hr'g Tr. 33-34]. Bart told Sobo that he would be able to manufacture and sell to him "slap wraps" in various styles. They also discussed pricing at the meeting, but only in general terms. Bart told Sobo that pricing depended on quantity and other variables, but that the "slap wraps" would generally cost less than a dollar. [Bart Test., Hr'g Tr. 23; Sobo Test., Hr'g Tr. 41-42].

After the New York meeting in May, Sobo kept in touch with Bart and Garfinkel via telephone, fax, and email. They contacted each other approximately once every week or two to discuss issues such as pricing and the specifics of how Worldwide planned to manufacture the "slap wraps." [Sobo Test., Hr'g Tr. 34, 37-38; Bart Test., Hr'g Tr. 47]. Despite these relatively frequent contacts, the parties failed to finalize a deal by the end of summer 2001.

At some point thereafter, a dispute developed between the parties. SAS claims that Worldwide sent a second invoice to SAS, even though SAS never submitted another purchase order, billing SAS for "slap wraps" and related charges totaling $82,436.01. Id. at ΒΆ 13. SAS further claims that its accounting department "erroneously" paid the second invoice because it mistakenly thought the invoice related to goods covered by the purchase order for 100,008 "slap wraps." ...


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