Thornton and Company, Inc. v. Lindamar Industries, Inc.

Filing 39

RULING granting 34 Motion to Transfer to Another District; denying 19 Motion to Dismiss for Lack of Jurisdiction. Signed by Judge Janet C. Hall on 12/9/2011. (Oliver, T.)

UNITED STATES DISTRICT COURT
DISTRICT OF CONNECTICUT
THORNTON & COMPANY, INC.
Plaintiff,
v.
LINDAMAR INDUSTRIES, INC.
Defendant.

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CIVIL CASE NO.
3:11-cv-375 (JCH)

DECEMBER 9, 2011

RULING RE: DEFENDANT’S MOTION TO DISMISS (DOC. NO. 19)
& PLAINTIFF’S MOTION TO TRANSFER (DOC. NO. 34)
I.

INTRODUCTION
Plaintiff Thornton & Company, Inc. (“Thornton”) filed this action against the

defendant, Lindamar Industries, Inc. (“Lindamar”), on March 7, 2011, alleging that
Lindamar owes it $130,515.40 for “goods sold and delivered [by Thornton to Lindamar]
from June 28, 2010, through August 24, 2010.” Compl. (Doc. No. 1) ¶ 4. Lindamar has
moved to dismiss this action pursuant to Rule 12(b)(2) of the Federal Rules of Civil
Procedure for lack of personal jurisdiction. Mot. to Dismiss (Doc. No. 19). Thornton
objects to the Motion, arguing, first, that Lindamar is subject to suit in Connecticut, and,
second, that the court should transfer rather than dismiss the case if it finds jurisdiction
lacking. Pl.’s Mem. in Opp. (Doc. No. 33) at 1; Mot. to Transfer (Doc. No. 34). For the
following reasons, the court grants the plaintiff’s Motion to Transfer and denies the
defendant’s Motion to Dismiss as moot.
II.

FACTUAL BACKGROUND1
The plaintiff, Thornton, is a Connecticut corporation with its principal place of

1

For purposes of this Motion to Dismiss, the court takes the facts alleged in the plaintiff’s
complaint, affidavit, and exhibits as true and draws all inferences in plaintiff’s favor. See Distefano v.
Carozzi North America, Inc., 286 F.3d 81, 84 (2d Cir. 2001).

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business in Southington, Connecticut. Compl. ¶ 1. The defendant, Lindamar, is a
California corporation with its principal place of business in Paso Robles, California.
Compl. ¶ 2.
Thornton sells bulk plastic resin (“plastic”) it obtains from third-party suppliers to
manufacturers, who melt the plastic down for use in products such as plastic bags and
food containers. Wittneben Aff. (Doc. No. 33-1) ¶ 2. Beginning in April 2010, Lindamar
ordered plastic from Thornton on ten occasions. Id. ¶¶ 4, 8. These orders were placed
with Douglas Dunn, Thornton’s sales representative in California. Id. ¶ 4.
The sales to Lindamar were made on credit. Id. ¶ 5. Following each sale,
Thornton would send an invoice to Lindamar. Id. ¶ 10(f). On the back of each invoice
was a list of Conditions of Sale, including a clause stating that the “contract shall be
governed by the laws of the State of Connecticut.” Invoice (Doc. No. 33-5) ¶ 8.
For five of the orders, Lindamar sent payment to the Thornton offices in
Connecticut. Wittneben Aff. ¶ 5. Another order was returned and resold to another
party. Id. ¶ 7. On four occasions, however, Lindamar refused to pay, arguing that
Thornton had provided defective plastic. Id. ¶ 9. Further, the plastic could not be
returned and resold, because it had already been processed into other products and
sold to third parties. Id. Thornton subsequently filed suit, claiming that Lindamar owed
it $130,515.40 for the unpaid orders. Compl. ¶ 4.
III.

LEGAL STANDARD
“On a Rule 12(b)(2) motion to dismiss for lack of personal jurisdiction, the plaintiff

bears the burden of showing that the court has jurisdiction over the defendant.” Met Life
Ins. Co. v. Robertson-Ceco Corp., 84 F.3d 560, 566 (2d Cir. 1996). “Where a court

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relies on pleadings and affidavits, rather than conducting a ‘full-blown evidentiary
hearing,’ the plaintiff need only make a prima facie showing that the court possesses
personal jurisdiction over the defendant.” DiStefano, 286 F.3d at 84. “A plaintiff can
make this showing through his own affidavits and supporting materials containing an
averment of facts that, if credited . . . , would suffice to establish jurisdiction over the
defendants.” Whitaker v. American Telecasting, Inc., 261 F.3d 196, 208 (2d Cir. 2008)
(internal citations and quotation marks omitted). All allegations are construed “in the
light most favorable to plaintiff and doubts are resolved in the plaintiff’s favor.” Id.
IV.

DISCUSSION
“[T]he amenability of a foreign corporation to suit in federal court in a diversity

action is determined in accordance with the law of the state where the court sits.”
Arrowsmith v. United Press Int’l, 320 F.2d 219, 223 (2d Cir. 1963) (en banc).
“Connecticut uses a familiar two-step analysis to determine if a court has personal
jurisdiction. First, the court must determine if the state’s long-arm statute reaches the
foreign corporation. Second, if the statute does reach the corporation, then the court
must decide whether that exercise of jurisdiction offends due process.” Bensmiller v.
E.I. Dupont de Nemours & Co., 47 F.3d 79, 81 (2d Cir. 1995).
Thornton argues that jurisdiction is conferred by section 33-929(f) of the
Connecticut General Statutes, which provides, in relevant part, that “every foreign
corporation shall be subject to suit in this state, by a resident of this state or by a person
having a usual place of business in this state . . . on any cause of action arising . . . out
of any contract made in this state or to be performed in this state.” Conn. Gen. Stat. §
33-929(f)(1). Thus, jurisdiction is only proper in this case if the court finds that the sales

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contracts at issue were made in Connecticut or were to be performed in Connecticut.
A.

Were the contracts made in Connecticut?

Under Connecticut law, a contract “is considered made when and where the last
thing is done which is necessary to create an effective agreement.” H. Lewis
Packaging, LLC v. Spectrum Plastics, Inc., 296 F. Supp. 2d 234, 239 (D. Conn. 2003).
Here, Lindamar made its offers to buy plastic to Douglas Dunn, Thornton’s sales
representative in California. Thornton argues that those orders were accepted by its
Vice President, Nathaniel DeAngelis, at the company’s office in Southington,
Connnecticut. Pl.’s Mem. in Opp. at 4. The court disagrees. DeAngelis simply
communicated approval of the orders to sales representative Dunn. See id. This is the
corporate equivalent of an offeree talking to himself. It was Dunn in California who
actually communicated acceptance to the offeror, Lindamar. See id. 4 (stating that
DeAngelis “communicated Plaintiff’s acceptance of the [offers] back through Mr. Dunn
to Lindamar”). Accordingly, the court finds that the last step necessary to create an
effective agreement occurred in California, not Connecticut.
B.

Were the contracts performed in Connecticut?

Thonton contends that it “substantially performed every aspect of its contractual
obligations with Defendant here in Connecticut.” Pl.’s Mem. in Opp. at 4. It points out
that its Connecticut employees made calls to outside suppliers in order to locate plastic
appropriate for Lindamar; ran periodic credit checks on Lindamar; conducted online
research on Lindamar; wired funds to suppliers; made arrangements to ship plastic to
Lindamar; mailed invoices to Lindamar; and communicated by phone, email, and fax
with Lindamar regarding the quality of the plastic.

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In cases where a plaintiff seeks to rely on its own performance to satisfy section
33-929(f)(1), “courts have found jurisdiction only where (1) the contract expressly
contemplated or required performance in Connecticut, or (2) the plaintiff has actually
performed its obligations in Connecticut and such performance was the most substantial
part of the obligations to be performed under the contract.” General Star Indemnity Co.
v. Anheuser-Busch Co., No. 3:97-CV-2542, 1998 WL 774234, at *4 (D. Conn. Aug. 24,
1998) (citing cases).
In this case, the court does not find that the sales agreements between the
parties expressly contemplated or required performance in Connecticut. Lindamar
placed orders with a California sales agent for the delivery of plastic in California.
Where Thornton performed the administrative work necessary to secure those
deliveries was largely irrelevant to Lindamar. These were, at core, contracts for the sale
of goods, not contracts for the provision of Connecticut-based credit or administrative
services. Contra Advanced Claims Service v. Franco Enterprises, No. CV00037458S,
2000 WL 1683416, at *4 (Conn. Super. Oct. 14, 2000) (jurisdiction found proper where
parties contracted for plaintiff to perform investigative services in Connecticut); Bowman
v. Grolsche Bierbrouwerji B.V., 474 F. Supp. 725, 731-32 (D. Conn. 1979) (jurisdiction
found proper where written agreement contemplated that the plaintiff would sell the
defendant’s beer in Connecticut).2
For similar reasons, the court does not find that the activities performed by
2

For purposes of analysis under section 33-929(f)(1), the court does not find it necessary to
resolve the parties’ dispute as to whether the choice of law clause listed on the back of Thornton’s
invoices can properly be considered part of the parties’ sales agreements. See Pl.’s Mem. in Opp. at 7
(arguing that the course of performance established Lindamar’s acceptance of the invoice terms and
conditions). Even if the choice of law clause was integrated into the agreements, a choice of Connecticut
law does not amount to an express requirement or contemplation of Connecticut performance. See ebmpapst, Inc., et al., v. AEIOMed, Inc., 2009 U.S. Dist. LEXIS 8790, at *5 (D. Conn. Feb. 5, 2009).

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Thornton in Connecticut were “the most substantial part of the obligations to be
performed under the contract.” General Star Indemnity Co., 1998 WL 774234, at *4.
Again, all of the administrative activities described by Thornton were ancillary to its
primary obligation under the contracts: delivering plastic to Lindamar in California.3
Finally, the court finds that Lindamar’s sending of payments, emails, and faxes
from California to Connecticut, see Pl.’s Mem. in Opp. at 5, 7, is insufficient to confer
jurisdiction under section 33-929(f)(1). While the sending and receiving of payments
and other items has been found to constitute performance under section 33-929(f)(1) in
some cases, see, e.g., Teleco Oilfield Servs., Inc. v. Skandia Ins. Co., 656 F. Supp.
753, 757 (D. Conn. 1987), the Connecticut Supreme Court has made clear that such
acts “come within [the statute only] if the defendant ha[s] other significant contacts with
this state.” Lombard Brothers, Inc. v. General Asset Management Co., 190 Conn. 245,
257 (1983) (finding that the transfer of funds from Connecticut and the sending of
confirmation slips to Connecticut did not confer statutory jurisdiction where contracts
were “substantially made and executed in New York” and defendant had “sparsity of
contacts” with Connecticut).4
Here, Lindamar did not place its sales orders with Thornton’s Connecticut
employees, did not send its employees to visit Thornton’s Connecticut offices, has no

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The court notes that Thornton does not claim in its Memorandum or Affidavit that the plastic at
issue was shipped from a location in Connecticut. Instead, it claims that a Connecticut-based employee
arranged the shipping. Wittneben Aff. ¶ 4 (“Ms Cowdell then made arrangements for the shipment of
plastic to Defendant by rail or truck.”). Thus, even if the court characterized Thornton’s primary obligation
as shipment of plastic rather than delivery of plastic, it would not find that the most substantial part of
Thornton’s obligations were performed in Connecticut.
4

The Lombard decision actually addressed Conn. Gen. Stat. § 33-411(c), a statutory precursor to
section 33-929(f)(1) with identical language. Compare Lombard Bros, 190 Conn. at 253 (quoting
language of section 33-411(c)), with Conn. Gen. Stat. § 33-929(f)(1).

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employees of its own in Connecticut, has no property or bank accounts in Connecticut;
and does not advertise or sell its products in Connecticut. Hall Aff. (Doc. No. 20-2) ¶¶
3-10. As a result, the court finds that Lindamar has not had the sort of “significant
contacts” with Connecticut that the Lombard court deemed necessary to justify
jurisdiction under section 33-929(f)(1). See ebm-papst, Inc., et al., v. AEIOMed, Inc.,
2009 U.S. Dist. LEXIS 8790, at *5 (D. Conn. Feb. 5, 2009) (“Partial payments made to
Connecticut, without more, are . . . insufficient to constitute performance of the contract
pursuant to 33-929(f)(1).”).
In summary, Thornton has failed to make a prima facie showing that the court
has personal jurisdiction over Lindamar.5 Pursuant to 28 U.S.C. § 1406(a), however, a
court may cure a lack of personal jurisdiction “by transfer to a district in which personal
jurisdiction [can] be exercised.” SongByrd, Inc. v. Estate of Grossman, 206 F.3d 172,
179 n.9 (2d Cir. 2000). Thornton has requested that, rather than dismiss the case, the
court transfer it to the Central District of California where the defendant resides. Pl.’s
Mem. in Opp. at 12. Lindamar agrees that the Central District of California is a proper
venue for the case. Def.’s Mem. in Supp. (Doc. No. 20) at 9. Accordingly, the court
concludes that it is in the interest of justice to transfer the case rather than dismiss it.
V.

CONCLUSION
For the forgoing reasons, the plaintiff’s Motion to Transfer (Doc. No. 34) is

granted and the defendant’s Motion to Dismiss (Doc. No. 19) is denied as moot. The

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Because the court concludes that the requirements of section 33-929(f) are not satisfied, it need
not address whether the exercise of jurisdiction would offend due process. The court notes, however,
that it has serious doubts as to whether Lindamar could be found to have “purposefully avail[ed] itself of
the privilege of conducting activities within [Connecticut], thus invoking the benefits and protections of its
laws.” Hanson v. Denckla, 357 U.S. 235, 253 (U.S. 1958).

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Clerk is directed to transfer this case to the United States District Court for the Central
District of California.
SO ORDERED
Dated at Bridgeport, Connecticut, this 9th day of December, 2011.

/s/ Janet C. Hall
Janet C. Hall
United States District Judge

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