Wilderness USA, Inc. v. DeAngelo Bros. LLC

265 F. Supp. 3d 301
CourtDistrict Court, W.D. New York
DecidedAugust 23, 2017
Docket6:17-CV-06491-EAW
StatusPublished
Cited by2 cases

This text of 265 F. Supp. 3d 301 (Wilderness USA, Inc. v. DeAngelo Bros. LLC) is published on Counsel Stack Legal Research, covering District Court, W.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wilderness USA, Inc. v. DeAngelo Bros. LLC, 265 F. Supp. 3d 301 (W.D.N.Y. 2017).

Opinion

DECISION AND ORDER

ELIZABETH A. WOLFORD, United States District. Judge

INTRODUCTION

Plaintiff Wilderness USA, Inc. (“Plaintiff’) commenced this action in New York State Supreme Court, Monroe County, seeking various forms of relief arising out of a contractual dispute with defendant DeAngelo Brothers LLC (“Defendant”). (Dkt. 1-1). On July 25, 2017, Defendant [303]*303filed a notice of removal to this Court based on diversity jurisdiction. (Dkt. 1; see Dkt. 2 (continuation of exhibits)).

Presently pending before the Court is Defendant’s motion to dismiss for lack of in personam jurisdiction and improper venue. (Dkt. 9). The central question governing the disposition of this motion is whether the Court has general jurisdiction over a party, such as Defendant, who is registered to do business as a foreign corporation in New York State, and, as such, has appointed the New York State Secretary of State as its agent for service process. See N.Y. Bus. Corp. Law §§ 1301, 1304(a)(6). Defendant rightly acknowledges that New York courts have permitted the exercise of general jurisdiction over a foreign corporation upon no other basis but compliance with the registration statute. See Steuben Foods, Inc. v. Oystar Grp., No. 10-CV-780S, 2013 WL 2105894, at *3 (W.D.N.Y. May 14, 2013). However, Defendant also contends that this method of acquiring personal jurisdiction is outmoded and has been rendered inapplicable in light of the Supreme Court’s decision in Daimler AG v. Bauman, — U.S. -, 134 S.Ct. 746, 187 L.Ed.2d 624 (2014), as well as the subsequent cases decided within this Circuit. (Dkt. 9-2 at 15-17). Plaintiff recognizes that several federal district court cases have construed Daimler as Defendant suggests, (Dkt. 13 at 16), but Plaintiff argues that these cases were wrongly decided and that the exercise of general jurisdiction pursuant to New York’s business registration statute is still supported by good law. Because the Court agrees with Defendant that Daimler altered the landscape for acquiring personal jurisdiction in a case such as this, Defendant’s motion to dismiss (Dkt. 9) is granted, and Plaintiffs complaint is dismissed without prejudice.

FACTUAL BACKGROUND1

Plaintiff, a New York corporation maintaining its principal place of business within this district in Monroe County, New York (Dkt. 1-1 at ¶ 1), operates a business specializing in “vegetation management” {id. at 7). Plaintiff employs various individuals to assist in controlling overgrowth along highways and right-of-ways. {Id. at ¶8). According to Defendant’s notice of removal, Defendant is a Pennsylvania limited liability company and maintains its principal place of business in Pennsylvania.2 (Dkt. 1 at ¶ 11; see Dkt. 9-3 at ¶ 3).

On February 15, 2016, Plaintiff entered into a subcontract with a nonparty contractor known as Mercier, Inc. (“Mercier”) (Dkt. 1-1 at ¶ 9). Mercier agreed to bid on projects offered by the Georgia Department of Transportation (“GDOT”), and promised to assign Plaintiff as its sole subcontractor for vegetation management on any contracts it’was awarded by the State of Georgia. {Id. at ¶ 12). Mercier obtained three contracts for vegetation [304]*304management within three different GDOT districts (collectively, “GDOT Contract”). (Id. at ¶ 13). However, after learning that the owner of Mercier wished to sell the company to Defendant, Plaintiff engaged in negotiations with Mercier and Defendant to protect its rights under the subcontract. (Id. at ¶¶ 14,17).

On November 29, 2016, Plaintiff, Defendant, and Mercier entered into an “Assignment and Assumption and Release” agreement (the “Agreement”), which provided that Defendant would assume Mercier’s responsibilities under the subcontract with Plaintiff. (Id. at ¶ 21). The Agreement also prevented Defendant from interfering with Plaintiffs work under the GDOT Contract. (Id. at ¶ 22). Plaintiff alleges that it has been competently performing its obligations under the GDOT Contract for over a year and a half. (Id. at ¶ 35).

In June and July of 2017, Defendant allegedly sent its employees to antagonize GDOT personnel about Plaintiffs job performance under the GDOT Contract. (Id. at ¶ 42). Plaintiff notified Defendant that it was interfering with Plaintiffs obligations under the GDOT Contract, and Defendant responded by terminating the subcontract for several material breaches of the subcontract and the GDOT Contract. (Id. at ¶¶ 44-45). Plaintiff alleges that Defendant manufactured these various contractual breaches to “squeeze [Plaintiff] out of the GDOT Contract so that it can take over the work itself.” (Id. at ¶ 48). Plaintiff further alleges that it will suffer irreparable harm upon the termination of the subcontract, such as being forced to lay off 50 employees in Georgia, the loss of its goodwill and reputation with GDOT, and the loss of “substantial investments in acquiring materials and equipment” for the performance of the GDOT Contract. (See id. at ¶¶ 50-51, 53).

Plaintiff filed this action in New York State Supreme Court, Monroe County, seeking a declaration that it has not materially breached the subcontract or the GDOT Contract, a declaration that Defendant’s purported termination of the subcontract is void, injunctive relief enjoining Defendant from seeking to terminate the subcontract or otherwise interfere with Plaintiffs performance of the GDOT Contract, and, alternatively, monetary damages for Defendant’s alleged breach of the subcontract and the Agreement. (Id. at 10-12). On July 20, 2017, the state court entered a temporary restraining order preventing Defendant from terminating the subcontract or otherwise interfering with Plaintiffs performance of the GDOT Contract. (Dkt. 1-8).

Defendant has since filed a notice of removal (Dkt. 1), and a motion to dismiss/transfer of venue (Dkt. 9). Defendant claims that this Court does not have the authority to exercise either general or specific jurisdiction over Defendant, and thus, the action must be dismissed for lack of personal jurisdiction. (Dkt. 9-2 at 13-24). Plaintiff responds only to Defendant’s argument regarding general jurisdiction, and contends that personal jurisdiction has been established because Defendant has registered to do business in New York State as a foreign corporation and has appointed the New York State Secretary of State as its agent for service of process in the state. (Dkt. 13 at 6-17).

Defendant also contends that the complaint should be dismissed because the Western District of New York is an improper venue for this action and, alternatively, even if this Court chooses not to dismiss this action, the matter should be transferred to the State of Georgia as a matter of convenience. (Dkt. 9-2 at 24-29). Plaintiff opposes Defendant’s venue arguments, claiming that the Western District [305]*305of New York is the proper venue for this action, and that this Court should not exercise its discretion to transfer the case. (Dkt. 13 at 17-21).

DISCUSSION

I. Personal Jurisdiction

A. Legal Standard

“The requirement that a court have personal jurisdiction flows not from Art. Ill, but from the Due Process Clause. ...

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Bluebook (online)
265 F. Supp. 3d 301, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wilderness-usa-inc-v-deangelo-bros-llc-nywd-2017.