CHANT ENGINEERING CO., INC. v. CUMBERLAND SALES COMPANY

District Court, E.D. Pennsylvania·Decided March 5, 2021·No. 2:20-cv-04559·Unknown

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF PENNSYLVANIA

CHANT ENGINEERING CO. INC. : CIVIL ACTION Plaintiff : : NO. 20-4559 v. : : CUMBERLAND SALES COMPANY, et al. : Defendants :

NITZA I. QUIÑONES ALEJANDRO, J. MARCH 5, 2021

MEMORANDUM OPINION

INTRODUCTION Before this Court are the motions to dismiss for lack of personal jurisdiction, filed by Defendants Moe Machines, LLC (“Moe”), and Evans and Melissa Hood (collectively, with Moe, the “Moe Defendants”), [ECF 40, 41, 44], which Plaintiff Chant Engineering Co. Inc. (“Plaintiff” or “Chant”) has opposed. [ECF 50].1 In their motions, the Moe Defendants argue that this Court lacks general and specific personal jurisdiction over them because they are not “at home” in Pennsylvania, as required by the seminal Supreme Court decision Daimler AG v. Bauman, 571 U.S. 117 (2014), and because Plaintiff’s claims do not arise out of any contacts the Moe Defendants have or had with Pennsylvania. The issues presented in the motions have been fully briefed and are ripe for disposition. After careful consideration and for the reasons set forth herein, the Moe Defendants’ motions are granted.

1 The other defendants in this action have each filed their own motions to dismiss. Those motions have been addressed in separate opinions. BACKGROUND2 In 2013, Philip Chant, President of Chant Engineering Co. Inc. (a Pennsylvania entity), and Patrick Poe, then-President of Cumberland (a Tennessee entity), began discussing the possible sale of Cumberland’s various assets, in particular, Cumberland’s intellectual property rights in certain equipment. On April 15, 2014, Chant and Cumberland entered into an Asset Purchase Agreement, pursuant to which Cumberland sold Chant certain intellectual property rights to various equipment and Cumberland’s “customer lists, sales leads, quotes, etc.” As part of the agreement, Cumberland agreed not to compete with Chant for a defined period of time and to refer future business inquiries for the referenced equipment to Chant. Subsequent to Plaintiff’s acquisition of Cumberland’s intellectual property, Plaintiff obtained a copyright for a winder machine, the exclusive rights to which Plaintiff acquired from Cumberland.

Sometime in 2020, Defendants Melissa Hood and Evans Hood, daughter and son-in-law of Defendants Patrick Poe and Patricia Poe (all of whom live in Tennessee), created Defendant MOE Machines, LLC (a Tennessee entity). Plaintiff alleges that the Moe Defendants, along with Patrick and Patricia Poe and Cumberland, manufactured and sold a winder machine substantially identical to that for which Plaintiff obtained a copyright. The Moe Defendants did not pay Plaintiff for a license or other permission to manufacture the equipment.

LEGAL STANDARD Pursuant to Federal Rule of Civil Procedure (“Rule”) 12(b)(2), a defendant may move to dismiss a claim for lack of personal jurisdiction. Fed. R. Civ. P. 12(b)(2). Once a defendant has raised a lack of jurisdiction defense, the burden shifts to the plaintiff to present a prima facie case establishing jurisdiction over the non-resident defendant in the forum. Pinker v. Roche Holdings Ltd., 292 F.3d 361, 368 (3d Cir. 2002); see also Miller Yacht Sales, Inc., v. Smith, 384 F.3d 93, 97 (3d Cir. 2004) (“[W]hen the court does not hold an evidentiary hearing on the motion to dismiss, the plaintiff need only establish a prima facie case of personal jurisdiction.”). The plaintiff has the burden to show, “with reasonable particularity,” enough contact between the defendant and the

2 The facts relevant to the issue of personal jurisdiction are set forth herein. Where undisputed, the facts are taken from the parties’ pleadings and supporting declarations. Where the facts are disputed, they are construed in Plaintiff’s favor. forum state to support the exercise of personal jurisdiction by the forum state. Mellon Bank v. Farino, 960 F.2d 1217, 1223 (3d Cir. 1992) (internal citations omitted); see also Action Mfg. Co. v. Simon Wrecking Co., 375 F. Supp. 2d 411, 418 (E.D. Pa. 2005) (“In order to establish a prima facie case, the plaintiff must present specific facts that would allow the court to exercise

jurisdiction over the defendant.”). In determining the existence of personal jurisdiction, courts “must accept all of the plaintiff’s allegations as true and construe disputed facts in favor of the plaintiff.” Pinker, 292 F.3d at 368. Once the plaintiff’s “allegations are contradicted by an opposing affidavit . . . [the plaintiff] must present similar evidence in support of personal jurisdiction.” In re Chocolate Confectionary Antitrust Litig., 602 F. Supp. 2d 538, 556 (M.D. Pa. 2009). To counter opposing affidavits, “[p]laintiffs may not repose upon their pleadings []. Rather, they must counter defendant[’s] affidavits with contrary evidence in support of purposeful availment jurisdiction.” Id. at 559. To that end, the “plaintiff must respond to the defendant’s motion with ‘actual proofs;’ ‘affidavits which parrot and do no more than restate [the] plaintiff’s allegations . . . do not end the

inquiry.’” Lionti v. Dipna, Inc., 2017 WL 2779576, at *1 (E.D. Pa. June 27, 2017) (quoting Time Share Vacation Club v. Atl. Resorts, Ltd., 735 F.2d 61, 66 n.9 (3d Cir. 1984)). DISCUSSION The Moe Defendants move to dismiss this action based on the lack of requisite sufficient minimum contacts with Pennsylvania to support personal jurisdiction in this forum. The Moe

Defendants have offered the sworn declaration of Melissa Hood, one of Moe’s owners, in which she attests, inter alia, that: (1) Moe is neither incorporated in, nor maintains a principal place of business in, Pennsylvania, but rather, is a corporate entity incorporated and maintaining its principal place of business in Tennessee; and (2) the Hoods are residents of Tennessee. To demonstrate sufficient contacts with this forum to sustain personal jurisdiction, Plaintiff has not contested these jurisdictional facts3 but has instead relied primarily on the Moe Defendants’ conduct in allegedly manufacturing a piece of equipment based on Plaintiff’s copyrighted works, marketing that piece of equipment on the internet, and joining a trade association. Plaintiff’s

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