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Tanner v. Heath Graphics LLC

United States District Court, N.D. New York

March 8, 2017

PHELICIA TANNER, Plaintiff,
v.
HEATH GRAPHICS LLC, et al., Defendants.

          MEMORANDUM-DECISION AND ORDER

          Lawrence E. Kahn U.S. District Judge

         I. INTRODUCTION

         This case returns to the Court on defendant Mabeg Systems GmbH's second motion to dismiss for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2). Dkt. No. 43 (“Motion”). In a previous order, this Court denied Mabeg's first motion to dismiss for lack of personal jurisdiction and insufficient service of process and allowed plaintiff Phelicia Tanner to conduct jurisdictional discovery. Dkt. No. 38 (“March Order”) at 1. After discovery closed, Mabeg filed the pending Motion, to which Tanner-together with defendant and cross-claimant Heath Graphics LLC-responded. Dkt. Nos. 54 (“Heath Response”), 56-7 (“Tanner Response”). Mabeg then filed a reply. Dkt. No. 59-1 (“Reply”). For the following reasons, the Court grants Mabeg's motion.

         II. BACKGROUND[1]

         Tanner is a resident of Corinth, New York. Dkt. No. 1 (“Complaint”) ¶ 1. Heath Graphics is a corporation organized under the laws of the State of Washington; its principal place of business is in King County, Washington. Id. ¶¶ 6, 8. Mabeg is a foreign corporation organized under the laws of Germany, and it maintains its principal and sole place of business in Mörfelden-Walldorf, Germany. Id. ¶¶ 16-17; Dkt. No. 19-2 (“Grübel Affidavit”) ¶ 2.[2] Tanner conclusorily asserts that both Defendants were authorized to and did conduct and transact business within the State of New York. Compl. ¶¶ 9-10, 18-19.

         Tanner was employed at Web/Graphics/Amsterdam Printing (“Web Graphics”) in Queensbury, New York. Id. ¶ 38. On January 30, 2012, Tanner was injured while working with a Heath Sheet-fed Microcheck Press, which is a device used to print checks in industrial settings. Id. ¶¶ 35, 39, 41. Tanner was attempting to adjust the device's air pressure using an air valve located on the device when her left thumb became caught in a moving part. Id. ¶¶ 40-41. As a result of the injury, Tanner's left thumb had to be amputated. Id. ¶ 48. She also suffered disfigurement, nerve damage, and Complex Regional Pain Syndrome. Id.

         Heath Graphics designs, develops, and manufactures the Heath Sheet-fed Microcheck Press. Id. ¶¶ 26-29. Heath Graphics is also responsible for the assembly, inspection, repair, distribution, and sale of its machines. Id. ¶¶ 30-34. Tanner alleges that Heath Graphics sold a Heath Sheet-fed Microcheck Press to Web Graphics. Id. ¶¶ 37-38.

         Mabeg is a German corporation that operates in the “planning, design, manufacture and sale of machinery, components and equipment, in particular for the graphic industry and the general mechanical and plant engineering.” Grübel Aff., Ex. A. Tanner alleges that Mabeg designed, engineered, developed, manufactured, assembled, inspected, repaired, distributed, and/or sold the Heath Sheet-fed Microcheck Press and/or some component parts thereof. Compl. ¶ 136. In support of this assertion, Tanner submits a photograph of the identification plate adhered to the printing press that caused Tanner's injuries, which shows that the machine was manufactured by Mabeg Maschinenbau GmbH & Co. KG. Dkt. No. 29-23. Tanner contends that Mabeg sold, supplied, or provided the Heath Sheet-fed Microcheck Press or some of its component parts to Heath Graphics, which then sold the device to Web Graphics. Compl. ¶ 138.

         Mabeg was founded on February 25, 2010. Grübel Aff. ¶ 3. Mabeg contends that it has never delivered or sold a Microcheck Press or a similar product to Heath Graphics in the State of Washington or to any other state in the United States. Id. ¶ 6. Mabeg contends that it is impossible for Mabeg to have manufactured the device at issue in this case or its component parts because Mabeg was not in existence at the time when the machine would have had to have been manufactured prior to Tanner's injury. Id. ¶ 7. But in its response to one of Tanner's interrogatories, Mabeg stated that it had sold three items to Heath Graphics since 2010. Dkt. No. 43-1 (“Grogan Affidavit”) Ex. B, at 8.[3] Mabeg did not say what these items were. Id.

         Grübel asserts that he is aware of another company that manufactured sheet feeders “identical to the product described in the Complaint” called “Mabeg Maschinenbau GmbH & Co.KG, ” which was dissolved after undergoing bankruptcy proceedings in Germany several years ago. Id. ¶¶ 8-9. He contends that although Mabeg has used “the historically valuable name ‘Mabeg'” since 2010, it has not assumed by contract or otherwise the liabilities of Mabeg Maschinenbau GmbH & Co.KG or any other company. Id. ¶ 10.

         Grübel states that Mabeg has never been incorporated or authorized to do business in New York, nor has it sought the privilege of doing so. Id. ¶¶ 11-12. Mabeg does not maintain any offices, warehouses, or places of business, nor does it lease, rent, or control any real estate in New York. Id. ¶¶ 13, 25. Mabeg does not employ any officers or agents in New York. Id. ¶ 14. Grübel further states that Mabeg does not solicit business, advertise, or otherwise participate in the sale, purchase, distribution, resale, or service of any goods in New York State. Id. ¶¶ 15-17; Grogan Aff. Ex. B, at 6. Mabeg has never contracted with any New York entity to complete any work or project in New York. Grübel Aff. ¶ 18. Additionally, Mabeg does not have a mailing address, telephone listing, or bank account in New York, nor has it ever paid any taxes in New York. Id. ¶¶ 20-21, 23-24.

         Mabeg entered into an exclusive agency agreement with TM Design & Engineering, LLC (“TMDE”) in April 2011. Dkt. No. 29-15 (“Alio Affidavit Exhibit H”) at 1. TMDE is based in Wisconsin, id. at 2, and under the agreement, which became effective on May 1, 2011, TMDE would serve as the exclusive distributor of Mabeg's products in the United States, id.; Heath Resp. at 14. TMDE would also “advertis[e] Mabeg products, mak[e] calls on potential clients, [and] support customer service for specific products as requested by Mabeg.” Heath Resp. at 14. In responding to one of Tanner's interrogatories, Mabeg said it had “sold numerous items to TM Design and Engineering since its inception in 2010.” Grogan Aff. Ex. B, at 9. Mabeg did not describe these items. Id.

         Mabeg has international reach. In 2012, Mabeg's sales to the United States accounted for 1.72% of total sales, 61.55% of sales involved German, Swiss, or Austrian entities, and the remainder involved thirty-eight other countries. Id. at 13. In 2013, Mabeg's United States sales accounted for 3.44% of total sales, its German, Swiss, and Austrian sales accounted for 55.65%, and the remainder went to forty-five other countries. Id. at 14. In 2014, 7.58% of Mabeg's sales were made in the United States, 72.08% were made in Germany and Switzerland, and the remainder went to forty-four other countries. Id. at 15. Finally, in 2015, Mabeg's United States sales accounted for 1.74% of total sales, 76.18% of sales went to German and Swiss entities, and the remainder involved forty-six other countries. Id. at 17.

         The origins of the machine (or its component parts) that injured Tanner remain unclear. Tanner notes that she “is unable to produce facts to ascertain the chain of sale of the subject machine press; if it was manufactured specifically for [Tanner's] former employer in New York State; and how it made its way into New York.” Tanner Resp. at 7. She blames Mabeg for this, suggesting that its discovery responses on this and other points were inadequate. Id. at 6. As noted above, Tanner's Complaint alleges that Mabeg sold the machine (or its component parts) to Heath Graphics, which then sold it to Web Graphics. Compl. ¶ 138. It is at least possible that Mabeg instead sold the relevant item to TMDE, which then sold it to Heath Graphics, which finally sold it to Web Graphics.[4] In any event, aside from the item that injured Tanner, there is no evidence (or allegation) that any Mabeg products have ended up in New York, though Mabeg's sales figures indicate that a not insubstantial portion of its products ended up somewhere in the United States from 2012 to 2015. Grogan Aff. Ex. B, at 13-17.

         III. LEGAL STANDARD

         Where a party moves to dismiss an action for lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(2), the plaintiff bears the burden of showing that the court has jurisdiction over the defendant. Metro. Life Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 566 (2d Cir. 1996). When ruling on a motion to dismiss under Rule 12(b)(2) for lack of personal jurisdiction, a court is not limited to considering “the four corners of the complaint.” Phillips v. Reed Grp., Ltd., 955 F.Supp.2d 201, 225 (S.D.N.Y. 2013). “[T]he Court may also rely on submitted affidavits and other supporting materials submitted in relation to the motion.” Id. Where a court relies only upon the pleadings and supporting affidavits, a plaintiff need only make a ...


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