YUAN MEI CORPORATION v. SNOW JOE, LLC et al

Filing 64

OPINION AND ORDER granting Defendants' 14 Motion to Dismiss Plaintiff's Amended Complaint. To the extent Plaintiff is able to cure the deficiency identified in the Court's Order, it shall have thirty (30) days from the date of this Order to file a second amended complaint. Signed by Judge Claire C. Cecchi on 3/6/2025. (wh)

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
YUAN MEI CORPORATION,

Civil Action No.: 24-7906

Plaintiff,
v.

OPINION & ORDER

SNOW JOE, LLC, et al.,
Defendants.
CECCHI, District Judge.
Before the Court is the motion to dismiss for lack of jurisdiction plaintiff Yuan Mei
Corporation’s (“Plaintiff”) amended complaint (ECF No. 1-3) (“AC”) filed by defendants All
Season Power LLC (“All Season”), Joseph Cohen (“Cohen”), and OPE Marketplace LLC (“OPE”)
(ECF No. 14) (“Mot.”) and joined in support by defendant Snow Joe LLC (“Snow Joe”) (ECF No.
15) (collectively, “Defendants”). Plaintiff opposed the motion (ECF No. 21) (“Opp.”) and
Defendants replied in support (ECF No. 24) (“Reply”). The Court decides this matter without oral
argument pursuant to Federal Rule of Civil Procedure 78(b). For the reasons set forth below,
Defendants’ motion is GRANTED.
I.

BACKGROUND
A. Factual History
This matter arises out of an alleged business relationship between Plaintiff and defendant

Snow Joe. According to the complaint, Plaintiff is a Taiwanese product manufacturer and Snow
Joe is a New Jersey-based seller of consumer products that was founded by defendant Cohen. AC
¶¶ 1-3. The two parties entered into an agreement in 2015—which they have periodically
updated—under which Plaintiff would manufacture products to be purchased by Snow Joe and

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sold under the Snow Joe brand name. Id. ¶ 6. The latest version of that agreement provides that
the relationship between the parties is governed by the laws of the state of New Jersey. Id. ¶ 9.
In April 2023, following conversations between the parties, Snow Joe purportedly
acknowledged over several emails that it owed Plaintiff almost eight million dollars for past
inventory. Id. ¶¶ 13-16. In September 2023, Plaintiff sent Snow Joe a letter demanding payment
of all past due amounts and threatening legal action if no repayment agreement was reached. Id. ¶
17. No agreement was subsequently reached, and Plaintiff filed the instant action in state court
against Snow Joe. Id. ¶¶ 18-19.
Following the filing of the initial complaint, Snow Joe transferred substantially all its assets
in a sale conducted pursuant to Article 9 of the Uniform Commercial Code. Id. ¶¶ 22-23, 25.
According to Plaintiff, defendant All Season became the owner and operator of Snow Joe and
continued to maintain the business as it existed previously, including “the appearance and design
of the website, business operations, and products being sold.” Id. ¶ 28. Then, at some point prior
to the filing of the amended complaint, defendant OPE became the owner and operator of Snow
Joe and further continued to maintain the preexisting website, business operations, and products
being sold. Id. ¶¶ 32-33. Plaintiff alleges that defendant Cohen has remained “employed and/or in
control of operations” of Snow Joe following the Article 9 sale. Id. ¶ 30.
B. Procedural History
Plaintiff filed its initial complaint against Snow Joe in the Superior Court of New Jersey,
Hudson County, on September 18, 2023. See ECF No. 1-1. Plaintiff subsequently filed an amended
complaint against all Defendants on July 1, 2024. See ECF No. 1-3. The amended complaint asserts
state law claims for: book account; unjust enrichment; breach of contract; breach of the covenant

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of good faith and fair dealing; breach of fiduciary duty; successor liability; and alter ego. See id.
¶¶ 34-77.
Defendants All Season, OPE, and Cohen removed the action to this Court on July 19, 2024.
ECF No. 1. Removal was premised on diversity jurisdiction, as Plaintiff is a citizen of the Republic
of China and Defendants are citizens of New York and Pennsylvania. See id. ¶¶ 7-25. On August
12, 2024, All Season, OPE, and Cohen filed the instant motion to dismiss for lack of jurisdiction.
ECF No. 14. Defendant Snow Joe joined the motion the following day. ECF No. 15. Defendants
claim that Plaintiff has failed to comply with two New Jersey statutes governing foreign
corporations, N.J.S.A. § 14A: 13-11 and N.J.S.A. § 14A: 13-20, and that failure to comply with
either one of those statutes precludes Plaintiff from pursuing an action in this Court. See generally
ECF No. 14.
C. Statutory Background
N.J.S.A. § 14A: 13-11 and N.J.S.A. § 14A: 13-20 impose limitations on foreign
corporations engaged in commerce in New Jersey. As relevant here, both statutes foreclose access
to the courts if a foreign corporation does not meet certain administrative requirements. For
instance, N.J.S.A. § 14A: 13-11 provides that a foreign corporation that is “transacting business”
within the state must obtain a certificate of authority, or it may not “maintain any action of
proceeding in any court of this State.” Meanwhile, N.J.S.A. § 14A: 13-20 provides that a foreign
corporation “carrying on any activity or owning or maintaining any property” in the state—and
which has not obtained a certificate of authority—must file a notice of business activities report
before maintaining “any action or proceeding in any State or Federal court in New Jersey.” As
both parties appear to agree that their relationship is governed by New Jersey law, see AC ¶ 9;
Mot. at 2, these statutes are controlling insofar as they are applicable to the present action.

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II.

STANDARD OF REVIEW
Pursuant to Federal Rule of Civil Procedure 12(b)(1), a court must grant a motion to

dismiss if it determines that it lacks subject matter jurisdiction over a claim. In re Schering Plough
Corp. Intron/Temodar Consumer Class Action, 678 F.3d 235, 243 (3d Cir. 2012). In evaluating a
12(b)(1) motion, a court must first determine whether the motion is a facial or factual challenge to
the existence of jurisdiction, as this determines the proper scope of review. Const. Party of Pa. v.
Aichele, 757 F.3d 347, 357-58 (3d Cir. 2014). Under a facial challenge—which attacks the
sufficiency of the complaint—the court “must only consider the allegations of the complaint and
documents referenced therein and attached thereto, in the light most favorable to the plaintiff.” Id.
at 358. Under a factual challenge—which asserts that there is no subject matter jurisdiction because
of some underlying jurisdictional facts—the court “may look beyond the pleadings to ascertain the
facts.” Id.
Although Defendants do not style their challenge as either facial or factual, the Court
construes their motion as a factual attack because Defendants do not assert that Plaintiff’s pleading
is insufficient, but rather that Plaintiff has failed to comply with N.J.S.A. § 14A: 13-11 and
N.J.S.A. § 14A: 13-20. 1 See Field Smart Lighting Co., Ltd. v. Checkolite Intern., Inc., No. 136953, 2014 WL 2155372, at *2-3 (D.N.J. May 22, 2014) (construing 12(b)(1) motion premised on
failure to comply with N.J.S.A. § 14A: 13-11 as a factual challenge). Accordingly, the Court will
consider evidence submitted by the parties beyond the pleadings in deciding the motion. See Ricky
Kamdem-Ouaffo trading as Kamdem Grp. v. Colgate Palmolive Co., No. 15-7902, 2016 WL
6398517, at *4 (D.N.J. Oct. 26, 2016) (“In considering a factual challenge to subject matter
jurisdiction . . . the Court may consider evidence outside the pleadings (such as affidavits,
Plaintiff notes in its opposition that Defendants no not specify whether their challenge is facial or factual. Opp. at 4.
Nonetheless, Plaintiff asserts that this Court has jurisdiction “[r]egardless of the standard applied.” Id.

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depositions, testimony, and other information) to resolve the factual issues bearing on
jurisdiction.”).
III.

DISCUSSION
Defendants contend that Plaintiff is foreclosed from pursuing an action in this Court

pursuant to both N.J.S.A. § 14A: 13-11 and N.J.S.A. § 14A: 13-20 because Plaintiff has failed to
either procure a certificate of authority or file a notice of business activities report. Plaintiff does
not appear to argue that it has either obtained such a certificate or filed such a report, but instead
asserts that it is not subject to the relevant statutes. For reasons discussed herein, the Court agrees
with Defendants that N.J.S.A. § 14A: 13-20 precludes this Court from exercising jurisdiction over
the instant matter and dismisses the action. However, the Court will allow Plaintiff the opportunity
to attempt to satisfy this statutory requirement and replead.
A. N.J.S.A. § 14A: 13-11
Plaintiff is not subject to N.J.S.A. § 14A: 13-11 because it is not a foreign corporation that
is “transacting business” in New Jersey for purposes of the statute. 2 By its terms, the statute only
applies to foreign corporations that are “transacting business” in the state. N.J.S.A. § 14A: 1311(1). “Transacting business,” moreover, refers to activities of local or intrastate business, and not
merely interstate business that touches New Jersey. 3 Berlin, Sachs & Werkstell v. Cart-Wright
2
Plaintiff also asserts that the statute’s jurisdictional bar only applies to state courts, and not federal courts. Opp. at 47. However, because the Court is sitting in diversity in jurisdiction—and thus enforcing state, not federal, rights—the
statute may preclude this Court’s jurisdiction. See Am. Ests., Inc. v. Marietta Cellars Inc., No. 10-6763, 2011 WL
1560823, at *2 (D.N.J. Apr. 25, 2011) (“Because this Court sits in diversity jurisdiction, [defendant] is correct that
[N.J.S.A. § 14A: 13-11] may close the doors of the Court to [plaintiff].”); cf. Datasphere Inc. v. Comput. Horizons
Corp., No. 5-2717, 2005 WL 8174965, at *2 (D.N.J. Dec. 7, 2005) (finding N.J.S.A. § 14A: 13-11 will not bar federal
court jurisdiction “in a non-diversity case” where plaintiff seeks to enforce “rights granted by a federal statute”).
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This is a constitutional necessity: in Eli Lilly & Company v. Sav-On-Drugs, Incorporated, the Supreme Court
analyzed New Jersey’s then-applicable certification requirement for foreign corporations and stated that under the
Commerce Clause, the statute may not apply to corporations engaged solely in interstate trade. 366 U.S. 276, 278
(1961); see also Bonnier Corp. v. Jersey Cape Yacht Sales, Inc., 5 A.3d 799, 801-02 (N.J. App. Div. 2010) (“The
Court majority in Eli Lilly noted that, for purposes of the Commerce Clause analysis, it is critical whether the foreign
corporation’s presence in the State is confined to interstate business or whether the corporation also engaged in
intrastate business.”)

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Indus., Inc., No. 89-1781, 1990 WL 126197, at *2 (D.N.J. Aug. 27, 1990); see also Field Smart
Lighting Co., Ltd. v. Checkolite Intern., Inc., No. 13-6953, 2014 WL 2155372, at *3 (D.N.J. May
22, 2014) (noting N.J.S.A. § 14A: 13-11 “is applicable to foreign corporations conducting
intrastate business in New Jersey, as opposed to solely interstate business which touches New
Jersey”). To determine whether a corporation’s business activities are sufficiently local to fall
within the statute, courts are directed to examine the totality of the circumstances, Berlin, 1990
WL 126197, at *2, including whether the corporation has an office, employees, or a telephone
listing within the state, and whether local salespeople have the authority to approve contracts, see
QBI Intern. v. Princeton Gamma Tech, Inc., No. 84-2445, 1988 WL 78161, at *1 (D.N.J. June 27,
1988). Plaintiff has provided a declaration that it does not have an office, employees, or telephone
number in New Jersey, that all contact information for the corporation “routes through Taiwan,”
and that no shipments to Snow Joe were delivered to a New Jersey port. 4 See ECF No. 21-1 ¶¶ 78, 10. In the absence of countervailing considerations presented by Defendants, this information
is sufficient to find that Plaintiff is not “transacting business” in New Jersey for the purposes of
N.J.S.A. § 14A: 13-11, and thus is not subject to its certification requirement. See Field Smart
Lighting, 2014 WL 2155372, at *3 (finding N.J.S.A. § 14A: 13-11 not applicable where
corporation had “no offices or employees in New Jersey” and its products were “shipped to
Mexico”); QBI Intern., 1988 WL 78161, at *2 (finding N.J.S.A. § 14A: 13-11 not applicable where
corporation had “no office or warehouse in New Jersey,” “no telephone listing in th[e] state” and
its products were “subject to acceptance and approval” outside of the state).

Defendants do not appear to contest these facts, but state that they are “irrelevant to the instant analysis.” Reply at 9.
Defendants assert that the analysis should instead be controlled by N.J.S.A. § 14A: 13-15. Id. However, as described
below, N.J.S.A. § 14A: 13-15 determines whether a foreign corporation must “file a notice of business activities
report,” not whether it must obtain a certificate of authority pursuant to N.J.S.A. § 14A: 13-11. Defendant’s contention
is thus misplaced.

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B. N.J.S.A. § 14A: 13-20
Plaintiff is subject to N.J.S.A. § 14A: 13-20 because it falls within the statute’s ambit and
does not appear to have filed the requisite notice of business activities report. Whereas N.J.S.A.
§ 14A: 13-20 specifies the consequences of a failure to file a notice of business activities report,
N.J.S.A. § 14A: 13-15 enumerates the several “[a]ctivities” that, if conducted by a foreign
corporation, require that corporation to file such a report. As relevant here, those activities include
“receiving payments from . . . businesses located in this State” in an aggregate of greater than
$25,000. N.J.S.A. § 14A: 13-15(e). According to exhibits provided by Plaintiff along with its
amended complaint, the company received at least one payment totaling $500,000 from New
Jersey-based Snow Joe. See ECF No. 1-3, Ex. A at 7-10 (email from Yuan Mei employee
discussing the “$500,000 that Snow Joe wire-transferred back in Jan 10, 2023"). Despite this
activity, Plaintiff does not appear to have filed a notice of business activities report. 5 In the absence
of such a filing, and pursuant to N.J.S.A. § 14A: 13-20, Plaintiff cannot maintain the present action.
See Horgan Bros., Inc. v. Monroe Prop., L.L.C., No. 7-3028, 2010 WL 2674166, at *4 (D.N.J.
June 30, 2010) (dismissing case where plaintiff failed to file required notice of business activities
reports).
However, following others in this district, the Court will dismiss the complaint without
prejudice and allow Plaintiff the opportunity to replead after it has satisfied the requirements of
N.J.S.A. § 14A: 13-20. See Bernard Katz d/b/a Telesonic Packaging Corp. v. Apuzzo, No. 1916426, 2021 WL 12095085, at *5 (D.N.J. June 28, 2021) (noting that “legal authority within this
district . . . indicates that a non-compliant foreign corporation can retroactively comply with [the

Specifically, Plaintiff does not point the Court to any such filing in either its opposition papers or its attached
declaration, nor does it provide a copy of such a filing in its exhibits. Instead, Plaintiff asserts that under New Jersey
law it should be allowed to “cure any alleged filing deficiencies during the pendency of the litigation at issue.” Opp.
at 5.

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notice of business activity filing requirement] to then gain access to New Jersey courts”); Horgan
Bros., Inc., 2010 WL 2674166, at *4 (dismissing without prejudice and allowing non-compliant
foreign corporation to “satisfy its obligations” under N.J.S.A. § 14A: 13-20 and requirements
before “return[ing] to the Court”).
IV.

CONCLUSION
For the reasons stated above, Defendants’ motion to dismiss is granted.
Accordingly, IT IS on this 6th day of March, 2025,
ORDERED that Defendants’ motion to dismiss (ECF No. 14) Plaintiff’s amended

complaint (ECF No. 1-3) is GRANTED without prejudice;
ORDERED that to the extent Plaintiff is able to cure the deficiency identified in the
Court’s Order, it shall have thirty (30) days from the date of this Order to file a second amended
complaint.
SO ORDERED.

/s/ Claire C. Cecchi
CLAIRE C. CECCHI, U.S.D.J.

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