United States District Court, S.D. New York
August 18, 2005.
J. ROGER FAHERTY, Plaintiff,
SPICE ENTERTAINMENT, INC.; PLAYBOY ENTERPRISES, INC.; PLAYBOY ENTERPRISES INTERNATIONAL INC.; D. KEITH HOWINGTON, ANNE HOWINGTON, and LOGIX DEVELOPMENT CORPORATION, Defendants.
The opinion of the court was delivered by: ROBERT SWEET, Senior District Judge
Defendants Logix Development Corporation (hereinafter, "Logix")
and D. Keith Howington and Anne Howington (hereinafter, the
"Howingtons") (collectively, the "Defendants") have moved for
dismissal of the complaint filed by plaintiff J. Roger Faherty
(hereinafter, "Faherty) based on: (1) lack of personal
jurisdiction pursuant to Rule 12(b) (2), Fed.R.Civ.P.; (2)
improper venue pursuant to Rule 12(b) (3), Fed.R.Civ.P.; and
(3) failure to state a claim upon which relief can be granted
pursuant to Rule 12(b) (6), Fed.R.Civ.P.
For the reasons set forth below, the motion to dismiss is
granted for lack of personal jurisdiction under Rule 12(b) (2),
Fed.R.Civ.P. Lacking the requisite jurisdiction, this Court
refrains from reaching the merits of the remaining issues
Plaintiff filed his complaint on April 14, 2004, commencing
this action against Defendants Playboy Enterprises Inc., Playboy
International Inc., Spice Entertainment Inc., Logix, and the
Howingtons. The initial complaint alleged four causes of action:
breach of contract, statutory indemnification, tortious
interference with a contract, and common law conspiracy. On January 14, 2005, Defendants Logix and the Howingtons moved
to dismiss the complaint on grounds of lack of jurisdiction,
improper venue, and failure to state a claim. Faherty filed
opposition to the motion to dismiss and cross-moved to stay the
instant proceedings pending resolution of an ongoing and related
suit currently scheduled for trial in the Superior Court of
California, County of Los Angeles. The motion was marked fully
submitted on March 9, 2005.
Defendants Playboy Enterprises Inc., Playboy International Inc.
(hereinafter, collectively "Playboy") and Spice Entertainment
Inc., (hereinafter, "Spice") have stipulated with Faherty to
staying the instant action pending the resolution of the
California suit. This Court so ordered the parties' stipulation
on February 11, 2005. As such, the instant motion to dismiss does
not encompass any arguments set forth by Defendants Playboy or
The facts are set forth in the statements of the parties and
are not in dispute except as noted below. All well-pleaded
allegations are accepted as true for the purpose of this motion.
See Chambers v. Time Warner, Inc., 282 F.3d 147, 153 (2d Cir.
2002). The following statements do not constitute findings of the
Court. Faherty, a citizen and resident of New Jersey, filed a
complaint on April 14, 2004, against Defendants Spice and
Playboy, Defendant Logix, and Defendants D. Keith Howington and
Defendant Spice Entertainment, Inc., formerly known as Spice
Entertainment Companies, Inc., (collectively, "Spice"), is a
corporation organized and existing under the laws of the State of
Delaware, with a principal place of business in Chicago,
Illinois. Defendant Spice is a wholly owned subsidiary of
Defendant Playboy is a corporation organized and existing under
the laws of the State of Delaware, having its principal place of
business in Chicago, Illinois.
Defendant Logix is a corporation organized and existing under
the laws of the State of California, with its principal place of
business in Camarillo, California.
Defendants D. Keith Howington and Anne Howington are citizens
and residents of the State of California, residing in Ventura
County, California, and are the principal shareholders, officers,
and directors of Logix.
Faherty was the Chief Executive Officer of Spice until Playboy
acquired Spice on March 15, 1999. In connection with this acquisition, Spice effected a spin-off of a wholly-owned
subsidiary, Directrix, Inc., (hereinafter, "Directrix"), to
Spice's shareholders. At that point, Faherty ended his employment
with Spice and assumed the position of Chief Executive Officer at
The instant action arises from and relates to an alleged breach
by Defendants Spice and Playboy of the indemnification provisions
applicable to corporate officers and directors, as set forth in
the June 13, 1997 Amended and Restated By-Laws (hereinafter, the
"By-Laws") of Defendant Spice, presently a wholly-owned
subsidiary of Defendant Playboy.
The California Action
On May 17, 2001, Logix and the Howingtons, as plaintiffs,
commenced suit against Faherty, Spice, Playboy, and other
defendants in the Superior Court of California, (hereinafter, the
"California Action"). The California Action focused upon an
alleged breach of an Agreement dated January 18, 1997,
(hereinafter, the "Main Agreement"), between Logix and Emerald
Media, Inc. (hereinafter, "EMI").
In the California Action, Logix and the Howingtons sought to
hold Spice, Playboy, Faherty and others liable for EMI's alleged
breach of the Main Agreement under an alter ego theory of liability. Plaintiffs further alleged that they had been
defrauded by Spice, Playboy, Faherty, and others.
Trial in the California Action is scheduled to proceed in late
Defendants Playboy and Spice Settle with Logix and the
In February 2004, Logix and the Howingtons entered into a
confidential settlement agreement (hereinafter, the "Settlement
Agreement") with Defendants Playboy and Spice, in which they
settled their claims against Playboy and Spice for $8.5 million.
Faherty was not included as a beneficiary of this confidential
Settlement Agreement in the California Action.
Based on his exclusion from this agreement, Faherty now seeks,
in part, contractual and statutory indemnity from Defendants
Playboy and Spice with respect to the claims asserted by Logix
and the Howingtons against Faherty in the California Action.
Faherty also seeks damages from Defendants Logix and the
Howingtons for tortious interference with Faherty's contractual
right to indemnity from Defendants Playboy and Spice. Discussion
Defendants Logix and the Howingtons (collectively, the
"Defendants") are named in only two of the four counts in
Faherty's complaint: the Third Count, for tortious interference
with contract, and the Fourth Count, for common law conspiracy.
As such, the instant motion to dismiss focuses exclusively on
these two counts.
A. Standard of Review
A motion to dismiss pursuant to Rule 12 must be denied "unless
it appears beyond doubt that the plaintiff can prove no set of
facts in support of his claim which would entitle him to relief."
Scheuer v. Rhodes, 416 U.S. 232, 236 (1974) (quoting Conley v.
Gibson, 355 U.S. 41, 45-46 (1957)). For purposes of a Rule 12
motion, all well pleaded allegations are accepted as true, and
all inferences are drawn in favor of the pleader. Mills v. Polar
Molecular Corp., 12 F.3d 1170, 1174 (2d Cir. 1993).
B. Defendants Filed Motion to Dismiss for Lack of Personal
Jurisdiction in a Timely Fashion
Faherty contends that Defendants failed to file their motion to
dismiss pursuant to Rule 12(b) (2), Fed.R.Civ.P., with the
Court in a timely fashion, thereby waiving their ability to argue
lack of personal jurisdiction. Both parties agree that Defendants waived the service of
summons on May 11, 2004. According to Rule 4(d)(3), Fed.R. Civ.
P., "a defendant that, before being served with process, timely
returns a waiver so requested is not required to serve an answer
to the complaint until 60 days after the date on which the
request for the waiver of service was sent." Thus, Defendants
were required to serve an answer to the complaint by July 11,
Defendants served an initial version of a motion to dismiss in
June 2004, well in advance of the July deadline and in full
compliance with Rule 12(a) (1) (B), Fed.R.Civ.P., which
reiterates the 60 day clock set forth in Rule 4(d) (3). See
Fed.R.Civ.P. 12(a) (1) (B) (a defendant shall serve an answer
"if service of the summons has been timely waived on request
under Rule 4(d), within 60 days after the date when the request
for waiver was sent . . .") Although Defendants served Faherty
with a motion to dismiss in accordance with Rule 4(d)(3),
Fed.R.Civ.P., Defendants did not file such motion with the Court until
January 14, 2005.
Faherty contends that this delay in filing with the Court
constitutes a waiver, thus preventing Defendants from arguing
lack of personal jurisdiction at this time. However, as Rule
5(d), Fed.R.Civ.P., makes clear, "all papers after the
complaint required to be served upon a party . . . must be filed
with the courts in a reasonable time after service." Defendants explain that the six month delay between serving
Faherty and filing with the Court resulted from logistical
complications, specifically Defendants' need to find local
counsel in New York and for their California counsel to be
admitted pro hac vice into New York courts, and from
Faherty's request to initiate settlement discussions. Once
several months passed without fruitful settlement negotiations,
Defendants filed the instant motion with the Court.
Rule 5(d)'s allowance for "reasonable time" to file with the
Court includes the time necessary to find local counsel, obtain
pro hac vice status for outside counsel, and engage in
settlement discussions. Furthermore, it is well established that:
The federal courts have liberally construed the words
"reasonable time" in order to minimize the incidence
of technical objections that a paper, although served
in ample time, was not filed under Rule 5(d) at the
4B Charles Alan Wright & Arthur R. Miller, Federal Practice and
Procedure § 1152 (3d ed. 2005).
For the foregoing reasons, Defendants' delay in filing the
instant motion with the Court did not constitute a waiver.
Defendants' motion to dismiss for lack of personal jurisdiction
has been filed with Court in a timely manner and in adherence
with Rule 5(d), Fed.R.Civ.P. C. Jurisdiction Has Not Been Established
Defendants contend that Faherty's complaint should be dismissed
for lack of personal jurisdiction pursuant to Rule 12(b) (2),
Fed.R.Civ.P., arguing that Faherty failed to allege sufficient
contact between Defendants and the instant forum to subject
Defendants to this Court's jurisdiction.
Plaintiffs bear the burden of establishing that the court has
jurisdiction over a defendant when served with a Rule 12(b) (2)
motion to dismiss. DiStefano v. Carozzi North American Inc.,
286 F.3d 81, 84 (2d Cir. 2001); Robinson v. Overseas Military
Sales Corp., 21 F.3d 502, 507 (2d Cir. 1994). Because an
evidentiary hearing has not been held, the plaintiffs need only
make a prima facie showing of jurisdiction through the
complaint's allegations and affidavits in order to defeat the
motion to dismiss. CutCo Indus., Inc. v. Naughton,
806 F.2d 361, 365 (2d Cir. 1986); Network Enterprises, Inc. v. APBA
Offshore Prods. Inc., 01 Civ. 11765 (CHS), 2002 WL 31050846, at
*8 (S.D.N.Y. Sept. 12, 2002).
The facts must be construed in the light most favorable to
plaintiffs. Cooper, Robertson & Partners L.L.P. v. Vail,
143 F. Supp. 2d 367, 370 (S.D.N.Y. 2001) (citing Hoffritz for Cutlery
Inc. v. Amajac, Ltd., 763 F.2d 55, 57 (2d Cir. 1985)). In
assessing whether personal jurisdiction is authorized, the court
must look first to the long-arm statute of the forum state. Bensusan Rest.
Corp. v. King, 126 F.3d 25, 27 (2d Cir. 1997). If the exercise
of jurisdiction is appropriate under that statute, the court must
decide whether such exercise comports with the requisites of due
In a diversity action, the law of the state in which the
district court sits governs personal jurisdiction over a
nonresident defendant. See Fed.R.Civ.P. 4(k) (1) (A);
United States v. First National City Bank, 379 U.S. 378, 381-82
(1965). Here, Faherty argues that Defendants are amenable to suit
under New York's corporate presence doctrine and under its long
arm statute. See N.Y.C.P.L.R. §§ 301, 302(a)(1)-(4).
1. Corporate Presence Doctrine
Pursuant to caselaw codified by section 301 of New York's Civil
Practice Law and Rules, an unlicensed foreign corporation is
subject to the general personal jurisdiction of the courts of New
York if such corporation is "doing business" in the state. See
Landoil Resources Corp. v. Alexander & Alexander Servs., Inc.,
77 N.Y.2d 28, 33, 563 N.Y.S.2d 739, 741, 565 N.E.2d 488, 490
(1990); accord Wiwa v. Royal Dutch Petroleum Co.,
226 F.3d 88, 95 (2d Cir. 2000). A defendant corporation is deemed to be
"doing business" in New York if it has engaged in "such a
continuous and systematic course of [business] here that a
finding of its `presence' in this jurisdiction is warranted[.]" Landoil,
77 N.Y.2d at 33, 563 N.Y.S.2d at 741, 565 N.E.2d at 490 (citing
Laufer v. Ostrow, 55 N.Y.2d 305, 309-310, 449 N.Y.S.2d 456,
458, 434 N.E.2d 692, 694 (1982); Delagi v. Volkswagenwerk AG,
29 N.Y.2d 426, 430-31, 328 N.Y.S.2d 653, 655-56, 278 N.E.2d 895,
896 (1972); Frummer v. Hilton Hotels Int'l, 19 N.Y.2d 533, 536,
281 N.Y.S.2d 41, 43, 227 N.E.2d 851, 853 (1967).
However, Faherty fails to allege sufficient facts to establish
that Defendants were found to have been "doing business" in New
York or that Defendants demonstrated any "of the factors
indicative of presence" in New York. Mareno v. Rowe,
910 F.2d 1043, 1046 (2d Cir. 1990). See also Fremay, Inc. v. Modern
Plastic Mach. Corp., 15 A.D.2d 235, 241-42, 222 N.Y.S.2d 694,
700-01 (1st Dept. 1961) (holding that for the purpose of
determining whether defendant corporation was doing business in
New York, it was of "no particular moment" that (1) the
defendant's corporate officers resided in New York and (2) that
such officers used their personal offices for incidental
transactions relating to their status as officers/investors.)
Faherty simply states that the Main Agreement, dated January
18, 1997, the breach of which gave rise to the California Action,
was negotiated in part by EMI and Logix in the State of New York.
(Aff. of Patrick J. Monaghan at ¶ 34.) However, the instant suit
arises out of Defendants' alleged failure to include Faherty's interests in the negotiation of the Settlement Agreement in
February 2004. The location of the negotiation of the Main
Agreement, the only fact alleged by Faherty that connects the
instant action to the State of New York, is a contextual, or
historical, fact but not a salient or sufficient fact conferring
in personem jurisdiction under N.Y.C.P.L.R. § 301.
Faherty fails to allege any facts pertaining to the location of
the negotiation of the Settlement Agreement. Furthermore, he
fails to allege additional facts to qualify Defendants as a
corporation "doing business" in the State of New York. As such,
Faherty fails to establish personal jurisdiction pursuant to the
corporate presence doctrine.
2. Long Arm Jurisdiction
New York State's long arm statute provides that:
As to a cause of action arising from any of the acts
enumerated in this section, a court may exercise
personal jurisdiction over any non-domiciliary, or
his executor or administrator, who in person or
through an agent:
1. transacts any business within the state or
contracts anywhere to supply goods or services in the
2. commits a tortious act within the state, except as
to a cause of action for defamation of character
arising from the act; or
3. commits a tortious act without the state causing
injury to person or property within the state, except
as to a cause of action for defamation of character arising from the act, if he
(i) regularly does or solicits business, or engages
in any other persistent course of conduct, or derives
substantial revenue from goods used or consumed or
services rendered, in the state, or
(ii) expects or should reasonably expect the act to
have consequences in the state and derives
substantial revenue from the interstate or
international commerce; or
4. owns, uses or possesses any real property situated
within the state.
N.Y.C.P.L.R. § 302(a).
In the complaint, Faherty alleges tortious interference with
contract, asserting that,
By negotiating and entering into a settlement with
Spice and Playboy and intentionally excluding
plaintiff Faherty, defendants willfully,
intentionally, and maliciously interfered with
Faherty's contractual right to indemnification from
Spice and Playboy.
(Comp. at ¶ 38). Faherty alleges that this same conduct gives
rise to the fourth count in the complaint, common law conspiracy,
detailing no further allegations against the Defendants.
As stated earlier, to prevail in the pre-discovery stage,
Faherty must make a prima facie showing of jurisdiction, and,
under a proper Rule 12(b) (2) analysis, all facts must be
construed in the light most favorable to Faherty. However,
despite this standard, Faherty fails to develop a record that yields a conclusion of
prima facie jurisdiction.
a. Count Three: Tortious Interference with Contract
i. § 302(a) (1)
Faherty provides no facts to support his allegations that the
negotiations and settlement referenced in the complaint affected
the transaction of business or the supply of goods and services
within the state, as required under N.Y.C.P.L.R. § 302(a) (1).
Instead, Faherty offers unsubstantiated allegations that do not
establish a presence in New York under C.P.L.R. 302(a) (1). See
Cutco Indus. at 365; Network Enterprises, Inc. at *8;
Socialist Workers Party v. Attorney General of the United
States, 375 F. Supp. 318, 322 (S.D.N.Y. 1974).
For the purpose of determining whether a given foreign
corporation defendant transacted business in New York under
N.Y.C.P.L.R. § 302(a) (1), "what counts is not the quantity of
contacts with New York, but rather the nature and quality of the
contacts." Lawrence Wisser & Co., Inc. v. Slender You, Inc.,
695 F. Supp. 1560, 1563 (S.D.N.Y. 1988). This inquiry focuses on
whether the defendant "`engaged in some purposeful activity
[here] . . . in connection with the matter in suit.'"
Parke-Bernet Galleries, Inc. v. Franklyn, 26 N.Y.2d 13, 16,
308 N.Y.S.2d 337, 340, 256 N.E.2d 506, 507 (1970) (quoting Longines Wittnauer Watch Co. v. Barnes &
Reinecke, 15 N.Y.2d 443, 457, 261 N.Y.S.2d 8, 18-19,
209 N.E.2d 68, 75 (1965)). Section 302(a) (1) requires purposeful activities
within New York and a "substantial nexus between the transaction
of business and the cause of action sued upon." Kahn Lucas
Lancaster, Inc. v. Lark Int'l Ltd., 956 F. Supp. 1131, 1134
(S.D.N.Y. 1997). Failure to satisfy either requirement mandates
dismissal of the claim for lack of jurisdiction.
The relationship between the business conducted in New York and
the claims alleged by a plaintiff must be direct. See Jacobs
v. Felix Bloch, 160 F. Supp. 2d 722, 739 (S.D.N.Y. 2001)
(holding no personal jurisdiction over plaintiff's copyright
infringement claim despite defendant engaging in numerous
transactions in New York related to the copyright infringement
that was the substance of the suit since these transactions were
not directly tied to the plaintiff's claims); see Pieczenik v.
Dyax Corporation, 265 F.3d 1329, 1333-34 (Fed. Cir. 2001)
(holding no personal jurisdiction over patent infringement claim
because mere existence of a contract between foreign defendant
and a corporation domiciled in New York was insufficient to prove
that foreign defendant transacted business in New York which had
a nexus to the induced infringement claims).
According to the Defendants, the negotiation and execution of
the Settlement Agreement, the terms of which excluded Faherty and gave rise to the instant suit, purportedly occurred
exclusively in California in February 2004 a critical fact that
remains undisputed by Faherty. Looking further back in time,
Faherty argues that in personem jurisdiction flows from the
negotiation of the Main Agreement, which occurred prior to and
during January 1997. As discussed earlier, Faherty contends that
the negotiation of the Main Agreement in 1997, the breach of
which constitutes the cause of action in the California Action,
occurred in part in New York. Faherty claims that these
negotiations "took place in New York as well as California and by
phone." (Aff. of Patrick J. Monaghan at ¶ 34.)
However, the Main Agreement, and consequently the negotiation
of the Main Agreement, are not the subject of the instant motion.
As it now stands, the complaint is silent as to the location of
the negotiation of the Settlement Agreement. Thus, Faherty fails
to allege sufficient contact with the State of New York arising
from the negotiation and eventual settlement of the California
Action to sustain a finding of in personam jurisdiction under
N.Y.C.P.L.R. § 302(a)(1).
ii. § 302(a) (2)
To obtain jurisdiction under N.Y.C.P.L.R. § 302(a)(2), the
defendant must have been present physically in New York while
committing the tort. Feathers v. McLucas, 15 N.Y.2d 443, 459, 261 N.Y.S.2d 8, 209 N.E.2d 68 (1965); see also Bensusan,
126 F.3d at 29 (denying jurisdiction under § 302(a) (2) where acts
were performed by persons physically present in Missouri even
though injury may have been suffered in New York); Carlson v.
Cuevas, 932 F. Supp. 76, 80 (S.D.N.Y. 1996) ("To subject
non-residents to New York jurisdiction under § 302(a) (2), the
defendant must commit the tort while he or she is physically in
New York state.").
The tortious act alleged by Faherty is, as explained above, the
negotiation and ultimate execution of a settlement between the
Defendants and Playboy and Spice. Again, the complaint fails to
allege where these negotiations and ultimate settlement took
place. Without additional details, Faherty's naked assertion in
the Third Count of the complaint does not establish the
commission of a tort in New York sufficient to establish
jurisdiction under C.P.L.R. 302(a) (2). Conclusory allegations do
not substitute for evidentiary facts; hence, Faherty fails to
make a showing of prima facie jurisdiction.
iii. § 302(a) (3)
Section 302(a) (3), which addresses tortious acts committed
outside New York causing injury in New York, also would not
confer jurisdiction. See N.Y.C.P.L.R. § 302(a) (3). Again, the
simple act of negotiating a settlement agreement in another
jurisdiction that affected Faherty, potentially in the State of
New York, is not, by itself, enough. See Sec. Nat. Bank v. Ubex
Corp., 404 F. Supp. 471, 474-75 (S.D.N.Y. 1975) (no jurisdiction
where injury existed in New York solely because of plaintiff's
domicile there); CMNY Capital, L.P. v. Perry, No. 97 Civ. 6172
(MBM), 1998 WL 132846, at *7-8 (S.D.N.Y. Mar.23, 1998) (no
jurisdiction with respect to tort claims, including fraud, based
on failure to share proceeds from sale of Rhode Island radio
"[C]ourts determining whether there is injury in New York
sufficient to warrant § 302(a) (3) jurisdiction must generally
apply a situs-of-injury test, which asks them to locate the
`original event which caused the injury.'" Whitaker v. American
Telecasting, Inc. 261 F.3d 196, 208-09, (2d Cir. 2001) (citing
Bank Brussels Lambert v. Fiddler Gonzalez & Rodriguez,
171 F.3d 779, 791 (2d Cir. 1999) (citation omitted)). "[T]he situs of the
injury is the location of the original event which caused the
injury, not the location where the resultant damages are felt by
the plaintiff." Id. (citing Mareno v. Rowe, 910 F.2d 1043,
1046 (2d Cir. 1990) (internal citation/quotations omitted))
(where plaintiff lived in New York and sued his New Jersey
employer for wrongful discharge, situs of injury was location of
events which caused injury, i.e., New Jersey, not place where
economic consequences were felt, i.e., New York); see also
Hermann v. Sharon Hosp., Inc., 135 A.D.2d 682, 683,
522 N.Y.S.2d 581, 583 (2d Dep't 1987) (in medical malpractice action,
situs of injury was place where plaintiff received medical
treatment, not where the effects of the doctor's negligence were felt). "The occurrence of financial consequences in New York due
to the fortuitous location of plaintiffs in New York is not a
sufficient basis for jurisdiction under § 302(a) (3) where the
underlying events took place outside New York." Id. (citing
United Bank of Kuwait v. James M. Bridges, Ltd.,
766 F. Supp. 113, 116 (S.D.N.Y. 1991)).
Faherty's own allegations make clear that the "original event
which [allegedly] caused the injury" was the Defendants' act of
entering into the settlement. Since that occurred in California,
the "situs-of-injury" is California not New York. Thus, there
is no personal jurisdiction under N.Y.C.P.L.R. § 302(a) (3), as
the Defendants' allegedly tortious acts were committed outside
the State of New York and did not cause any injury to Faherty
within the State of New York.
Moreover, even if there were a basis for finding that Faherty,
who admits he is a resident of New Jersey and not of New York,
did suffer injury in New York (which Faherty does not allege in
the complaint), there still would be no basis for the exercise of
personal jurisdiction pursuant to § 302(a) (3). First, Faherty
fails to allege that Defendants derive "substantial revenue" from
New York or otherwise engage in a "persistent course of conduct"
in New York. N.Y.C.P.L.R. § 302(a) (3) (i). And second, Faherty
fails to allege that Defendants did expected, or had any reason
to expect, that their acts of entering into the settlement in California with Playboy and Spice would have any foreseeable
consequences whatsoever in the State of New York. See
N.Y.C.P.L.R. § 302(a) (3) (ii).
As such, Faherty fails to allege fact giving rise to in
personam jurisdiction pursuant to N.Y.C.P.L.R. § 302(a) (3).
iv. § 302(a) (4)
Section 302(a) (4) provides for personal jurisdiction over a
non-domiciliary who "owns, uses or possesses any real property
situated within the state." N.Y.C.P.L.R. § 302 (a) (4). Faherty's
allegations of tortious interference do not involve the use or
possession of any property in the State of New York. Thus, this
section of New York's long-arm statute is inapplicable and cannot
confer personal jurisdiction to the Court in this matter.
b. Count Four: Common Law Conspiracy
With respect to Count Four of the complaint, common law
conspiracy, Faherty alleges that "[t]he defendants conspired
between and among themselves to deprive plaintiff of the right to
indemnification." (Compl. at ¶ 47). However, the complaint
alleges only one theory of liability against Defendants Count
Three alleging tortious interference with contract. Faherty does
not allege any additional conduct by Defendants to support his common law conspiracy claim; instead, he relies exclusively on
the alleged conduct underlying the tortious interference claim.
As explained above, that theory of liability does not confer
personal liability onto the Court. Since those allegations do not
support a finding of in personam jurisdiction, the conspiracy
claim, which arises out of the identical factual record alleged
to underlie the tortious interference claim, also fails to confer
in personam jurisdiction.
Finally, as a tangential note, Faherty argues that Defendants,
in particular Logix, were subject to personal service in this
judicial district and thus subject to proper venue in this
judicial district under 28 U.S.C. § 1391 (a), giving rise to in
personam jurisdiction over the Defendants. This is an improper
conflation of venue and in personam jurisdiction and a
mistaken interpretation of both New York State's long-arm
statute, see N.Y.C.P.L.R. § 302(a), and the federal venue
statute, see 28 U.S.C. § 1391(a).
As the factual record fails to make the requisite showing of
prima facie jurisdiction, sections 301 and 302 (a) (1)-(4) of
the New York State long-arm statute do not confer personal
jurisdiction to this Court over Defendants in the instant matter. Conclusion
Given the foregoing reasons, the complaint is dismissed without
prejudice for lack of personal jurisdiction. In the absence of
such jurisdiction, the Court will not address the merits of the
remaining issues. Faherty is granted leave to replead within
thirty (30) days of entry of this opinion.
It is so ordered.
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