Wall v. Cont'l Kraft Corp.

RAYMOND WALL, Plaintiff, v. CONTINENTAL KRAFT CORPORATION, et al., Defendants.

CIVIL ACTION No. 15-04838

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA

July 18, 2016

PAPPERT, J.

MEMORANDUM

Plaintiff Raymond Wall ("Wall") is a Pennsylvania citizen and former employee of Inter-Papier Handelsgesellschaft, M.B.H. ("Inter-Papier"), a German corporation. Wall served as Inter-Papier's sales director in the United States throughout 2014 until his relations with the company began to deteriorate in early 2015. Wall contends that Inter-Papier, among other affiliated corporations (collectively "Defendants"), owe him wages and commissions. The defendants move to dismiss Wall's amended complaint. The motion, based on several grounds including an alternative request to transfer the case to the Southern District of New York, is denied in all respects.

I.

In 2014 Continental Kraft Corporation ("CKC") and Inter-Papier formed a joint venture named Inter-Papier North America, Inc. ("Inter-Papier NA"). (Pl.'s Am. Compl. ¶¶ 3-5, 9-10, ECF No. 11.) The companies market and sell various paper products domestically and internationally. (Id. ¶ 9.) Sometime thereafter David Landau ("Landau"), the President of CKC, and Udo Knappe ("Knappe"), the General Manager of Inter-Papier, "negotiated a compensation agreement" with Wall "within the territorial jurisdiction" of this Court for Wall's "services in North America." (Id. ¶ 11; Wall Aff. ¶ 16, ECF No. 19-1.) Before the agreement was finalized, Wall was already "marketing and selling Defendants' products" and receiving payment for his work from Defendants. (Pl.'s Am. Compl. ¶ 12.) During the contract negotiations, both Landau and Knappe were aware that Wall's home office was located in Holland, Pennsylvania, and "repeatedly" contacted him there. (Id. ¶¶ 2, 13-14; Wall Aff. ¶¶ 12, 15, 18-20, 49, 51-54.)

On August 8, 2014 Landau e-mailed Wall the "agreement." Knappe was copied on the e-mail. (Pl.'s Am. Compl. ¶¶ 18-19; Pl.'s Am. Compl., Ex. A.) The agreement outlined the financial terms between the parties and, among other things, granted Wall an advance of $90,000 per year (or $7,500 per month), to be applied against his commissions. (Pl.'s Am. Compl., Ex. A.) The ultimate terms of the agreement were finalized in Holland, Pennsylvania. (Wall Aff. ¶ 22.)

Wall "marketed, negotiated, and secured sales" of Defendants' products from his home office in Holland. (Pl.'s Am. Compl. ¶¶ 20-21.) He also solicited several Pennsylvania-based companies. (Id. ¶ 22; Wall Aff. ¶¶ 36-37.) As a result of Wall's interactions with potential clients, Defendants shipped their products to customers in Pennsylvania and throughout the United States. (Pl.'s Am. Compl. ¶¶ 25-26; Pl.'s Am. Compl., Ex. B; Wall Aff. ¶¶ 30, 38-39.) Defendants introduced Wall "as an employee of Inter-Papier to their customers" and "invited [him] to attend professional seminars with [their] other employees." (Pl.'s Am. Compl. ¶¶ 27-28; Wall Aff. ¶ 40.) Knappe told Inter-Papier to produce a business card for Wall, which listed his title as "Sales Director" and his address as "Holland, Pennsylvania." (Pl.'s Am. Compl. ¶ 15; Wall Aff. ¶¶ 43-44.) Defendants also "routinely sent samples of their products" to Wall's office in Holland, Pennsylvania. (Pl.'s Am. Compl. ¶ 17; Wall Aff. ¶¶ 31-34.)

From July through December 2014 Defendants paid Wall "the monthly draw [$7,500], as well as travel costs and expenses." (Pl.'s Am. Compl. ¶¶ 29-31.) At the end of 2014, Defendants informed Wall that "CKC ceased to exist" and tried to "renegotiate the terms of their relationship" with Wall. (Id. ¶ 32.) Sometime thereafter, Landau and Knappe informed Wall that a successor entity to CKC, DPL Trading, LLC ("DPL") was formed and that DPL "would undertake CKC's obligations with respect to the parties' agreement." (Id. ¶¶ 6, 33-34.) DPL made three payments to Wall in January and February of 2015. (Id. ¶¶ 35-37.) These payments were similar to the ones that CKC made previously. (Id. ¶ 35.) Sometime after February the parties' attempts to renegotiate their agreement broke down. (Id. ¶ 38.)

Wall filed his amended complaint on November 2, 2015 against CKC, Inter-Papier, Inter-Papier NA and DPL. (ECF No. 11.) The complaint alleges that Defendants breached their agreement with him, violated Pennsylvania's Wage Payment and Collection Law ("WPCL"), 43 Pa. Cons. Stat. Section 260.1, et seq., and in the alternative were unjustly enriched by Wall's services. (Pl.'s Am. Compl. ¶¶ 48-66.) Wall also requests an accounting of the "proceeds, earnings [and] profits received . . . by Defendants in violation of [his] statutory and common law rights." (Id. ¶¶ 67-72.) He seeks relief in the form of actual, liquidated and statutory damages for his lost wages, as well as interest, penalties and attorneys' fees and costs. (Id. at 11-12.)

Defendants filed a motion to dismiss on November 11, 2015 contending that: (1) the Court lacks personal jurisdiction; (2) the Court should dismiss the complaint under the doctrine of forum non conveniens or alternatively; (3) the matter should be transferred to the Southern District of New York; and (4) the WPCL count fails to state a claim upon which relief can be granted.¹ (Defs.' Mot. at 8, ECF No. 12.) Wall filed a response, sur-reply and second sur-replyand Defendants filed a reply. (ECF Nos. 19-20, 23, 34.) The Court heard oral argument on Defendants' motion on June 1, 2016. (ECF No. 31.)

II.

A.

In reviewing a motion to dismiss for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2), the Court "must accept all of the plaintiff's allegations as true and construe disputed facts in favor of the plaintiff." Pinker v. Roche Holdings Ltd., 292 F.3d 361, 368 (3d Cir. 2002) (citation omitted). A motion made pursuant to Rule 12(b)(2) "is inherently a matter which requires resolution of factual issues outside the pleadings," i.e., "whether in personam jurisdiction actually lies." Time Share Vacation Club v. Atl. Resorts, Ltd., 735 F.2d 61, 66 n.9 (3d Cir. 1984). Once the defense has been raised, "then the plaintiff must satisfy its burden of proof in establishing jurisdictional facts through sworn affidavits or other competent evidence" and may not "rely on the bare pleadings alone." Id. (citing Int'l Ass'n of Machinists & Aerospace Workers v. Nw. Airlines, Inc., 673 F.2d 700 (3d Cir. 1982)). The plaintiff must instead offer evidence that establishes with reasonable particularity the existence of sufficient contacts between the defendant and the forum state to support jurisdiction. See Carteret Sav. Bank v. Shushan, 954 F.2d 141, 146 (3d Cir. 1992); see also Provident Nat. Bank v. Cal. Fed. Sav. & Loan Ass'n, 819 F.2d 434, 437 (3d Cir. 1987).

B.

Under Federal Rule of Civil Procedure 4(k), a district court typically exercises personal jurisdiction according to the law of the state where it sits. See O'Connor v. Sandy Lane Hotel Co., Ltd., 496 F.3d 312, 316 (3d Cir. 2007). Pennsylvania's long-arm statute permits a court to exercise personal jurisdiction "to the fullest extent allowed under the Constitution of the UnitedStates and . . . based on the most minimum contact with this Commonwealth allowed under the Constitution of the United States." 42 Pa. Cons. Stat. § 5322(b). To exercise personal jurisdiction over Defendants, the Court must determine whether under the Due Process Clause they have "certain minimum contacts with . . . [Pennsylvania] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice." O'Connor, 496 F.3d at 316-17 (citing Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)).

There are two type of personal jurisdiction: general and specific. Id. (citing Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414-15 & n.9 (1984)). General jurisdiction is proper when a defendant's contacts with the forum state are "continuous and systematic," whether or not those contacts are related to the plaintiff's cause of action. See Remick v. Manfredy, 238 F.3d 248, 255 (3d Cir. 2001). Specific jurisdiction exists when the "non-resident defendant has 'purposefully directed' his activities at a resident of the forum and the injury arises from or is related to those activities." Gen. Elec. Co. v. Deutz, 270 F.3d 144, 150 (3d Cir. 2001) (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985)). Wall argues that the Court has specific jurisdiction over Defendants. (Pl.'s Resp. at 2-8, ECF No. 19.)

The specific jurisdiction inquiry has three parts. See O'Connor, 496 F.3d at 317. First, the plaintiff must show that the defendant "purposefully directed [its] activities at the forum." Burger King, 471 U.S. at 472; see also Marten v. Godwin, 499 F.3d 290, 296 (3d Cir. 2007). Second, the litigation must "arise out of or relate to" at least one of those activities. Helicopteros, 466 U.S. at 414; see also Grimes v. Vitalink Commc'ns Corp., 17 F.3d 1553, 1559 (3d Cir. 1994). Third, if the prior two requirements are met, a court may consider whether the exercise of jurisdiction otherwise "comport[s] with 'fair play and substantial justice.'" Burger King, 471 U.S. at 476 (quoting Int'l Shoe, 326 U.S. at 320).

i.

As an initial matter, Defendants must have "purposefully avail[ed] [themselves] of the privilege of conducting activities within the forum." Hanson v. Denckla, 357 U.S. 235, 253 (1958). However, "[p]hysical entrance is not required." O'Connor, 496 F.3d at 317 (citing Grand Entm't Group, Ltd. v. Star Media Sales, Inc., 988 F.2d 476, 482 (3d Cir. 1993) ("Mail and telephone communications sent by the defendants into the forum may count toward the minimum contacts that support jurisdiction.")).

Many of Defendants' "claim-specific" contacts with Pennsylvania constitute purposeful contacts. Id. at 318. Specifically, Wall's affidavit states that "Defendants shipped their products through Pennsylvania and . . . the jurisdictional territory of the Eastern...