Indelicato v. Liberty Transportation, Inc.

Filing 19

REPORT AND RECOMMENDATIONS RE: 8 MOTION to Dismiss for Lack of Jurisdiction filed by Liberty Transportation, Inc.Objections due per 28 U.S.C. § 636(b) and Fed. R. Civ. P. 6, 72.Signed by Hon. Hugh B. Scott on 8/16/2018. (GAI)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NEW YORK
William Indelicato,
Plaintiff,

Report and Recommendation
18-CV-253V

v.
Liberty Transportation, Inc.,
Defendant.

I.

INTRODUCTION
Plaintiff William Indelicato responded to an online advertisement from defendant Liberty
Transportation, Inc. seeking New York truck drivers to help with manifests for various shipping
loads. Plaintiff eventually leased a truck from defendant and entered an independent contractor
agreement to accept manifests at his discretion. Between February 2017 and March 2018, plaintiff
hauled 167 loads for defendant and was paid biweekly for manifests completed. Over time, plaintiff
grew unhappy with how much defendant was deducting from his paychecks for expenses set forth
in his independent contractor agreement. In short, plaintiff came to believe that the deductions
improperly left his pay below federal and state minimum-wage requirements.
Plaintiff brought suit here alleging violations of the Fair Labor Standards Act (“FLSA”), 29
U.S.C. §§ 201–219, and Article 6 of the New York Labor Law (the “Labor Law”), N.Y. Lab. Law
§§ 190–199-a. Defendant now has filed a motion to dismiss the complaint for lack of personal
jurisdiction, under Rule 12(b)(2) of the Federal Rules of Civil Procedure (“FRCP”). Defendant
argues that it has insufficient general or specific contacts with New York to maintain personal
jurisdiction, considering its Pennsylvania location and incorporation; plaintiff’s independent
contractor status; and the small percentage of its overall business that has connections to New York;

among other factors. Plaintiff argues that the Court can exercise personal jurisdiction over
defendant, considering defendant’s efforts to recruit more New York drivers and considering the
number of manifests that he accepted that had some connection to New York, also among other
factors.
District Judge Lawrence J. Vilardo has referred this case to this Court under 28 U.S.C.
§ 636(b). (Dkt. No. 11.) The Court held oral argument on July 12, 2018. (Dkt. No. 18.) For the
reasons below, the Court respectfully recommends granting defendant’s motion.
II.

BACKGROUND
This case concerns allegations that defendant deducted too much from plaintiff’s pay,

causing plaintiff’s pay to fall below the minimum wage and to violate both the FLSA and the Labor
Law. Plaintiff is a resident of New York. Defendant is a Pennsylvania corporation with its principal
place of business in Pennsylvania. Defendant is a trucking “dispatching Company that seeks out
Shippers needing Independent Contractor services being provided as a common and / or contract
carrier by motor vehicle.” (Dkt. No. 9-1 at 8.) For the sake of brevity and consistent with Rule 12,
the Court recites the following background information in the light most favorable to plaintiff,
without further use of the word “alleged.”

A. Plaintiff responds to an ad and signs a contract
The relationship between plaintiff and defendant began around February 2017. Defendant
posted an advertisement online seeking one or more truck drivers in New York. Plaintiff responded
to the advertisement and communicated with defendant about the job. Defendant was interested in
hiring plaintiff because he lived in New York and held a New York driving license; defendant
wanted to increase its business with Canadian customers by developing a regular route across the
Peace Bridge in Buffalo. (Dkt. No. 13-2 at 2.) The communications led to the parties entering two
2

separate agreements; plaintiff asserts that he signed the necessary documents at his home in New
York. Since plaintiff did not own his own truck, he entered a Monthly Vehicle Lease Agreement to
lease a truck from defendant. (Id. at 7.)1 Among other provisions, the lease agreement contained
this language in a section titled, “Deductions”:
Lessee [i.e., plaintiff] agrees to permit and does permit Landmark to accept
automatic payments for any items under this Agreement (including, but not limited
to, lease payments, maintenance, registration fees, and insurance payments), directly
from Lessee’s employer, contractor, carrier, or anyone making payment to Lessor for
services where Lessee uses the leased “vehicle.” The purpose of this paragraph is to
insure that the Lease payment is guaranteed as a primary payment before any other
costs or expenses paid by Lessee.
(Id. at 11.) The parties also entered a Contractor Agreement that set up plaintiff as an independent
contractor who could accept shipping manifests from defendant’s dispatchers. (Dkt. No. 9-1 at 8.)
Among other provisions of this agreement, plaintiff had discretion to accept or to refuse available
manifests (id. at 10), though his discretion was somewhat limited by the need to take enough work to
meet his lease payments (Dkt. No. 13-2 at 11). Plaintiff agreed “to pay all direct costs and expenses
incidental to the operation of the Contractor’s vehicles and employees if and when utilized and
committed by Contractor. (This includes, but is not restricted to, drivers, helpers, oil, fuel, tolls,
repairs, ferries, liability insurance, Workers’ Compensation insurance premiums, any State
Unemployment Compensation premiums, all assessments, penalties, phone calls, road and fuel taxes,
registrations, permits, and fines for traffic violations.)” (Dkt. No. 9-1 at 10.) Defendant would pay
plaintiff for each manifest upon completion, subject to deductions that plaintiff authorized. (Id. at
11.) The Contractor Agreement specified that payments to plaintiff “are not to be construed as pay
/ wages, but are paid as Contract settlement payment for the services performed pursuant to this
1

The copy of the lease agreement that the Court has is not fully signed. For Rule 12 purposes only, the
Court notes that the parties do not appear to be contesting that they signed and fully executed a lease
agreement substantially identical to the copy that the Court has.

3

Agreement.” (Id. at 14.) Finally, the Contractor Agreement contains the following choice-of-law
provision: “Any interpretation or enforcement of this Agreement shall be exclusively in the Court of
Common Pleas of Westmoreland County applying the Laws of the Commonwealth of
Pennsylvania.” (Id. at 16.)
On March 24, 2017, plaintiff picked up his truck in Pennsylvania. Around that time,
defendant informed plaintiff that he had to incorporate as a condition of employment. (Dkt. No.
13-2 at 3.) Plaintiff opened a sole proprietorship and began the process of incorporating as a New
York limited liability corporation. (Id.) For reasons not disclosed in the record, plaintiff never
finished the creation of the limited liability corporation. (Id.)

B. Defendant’s deductions from plaintiff’s pay
The full extent of the relationship between plaintiff and defendant is not clear, but the
record provides some clues. Plaintiff accepted a total of 167 manifests until March 2018. (Id. at 4;
Dkt. No. 17-1 at 5–12.) Of the manifests that plaintiff accepted, some originated in New York,
some ended in New York, some passed through New York, and others had nothing to do with New
York. (Dkt. No. 13-2 at 4; Dkt. No. 17-1 at 5–12.) By plaintiff’s estimates, a majority of his
manifests originated in New York with an additional percentage of manifests ending in New York.2
(Dkt. No. 13-2 at 4.) Some of plaintiff’s New York manifests were regular biweekly arrangements.
(Id.)
The problems that arose between plaintiff and defendant concerned the nature of the
deductions to which plaintiff had agreed. Plaintiff has not provided all of his payment statements,
but he has provided one that he considers a sample. (Id. at 28.) The sample payment does not
2

Although the Court is construing all facts in the light most favorable to plaintiff for Rule 12 purposes, it will
note defendant’s documentation of every load that plaintiff hauled for a manifest. (Dkt. No. 17-1 at 5–12.)
The Court will address this documentation in more detail later.

4

specify the origin, route, or destination for the manifest that led to the payment. Nonetheless,
plaintiff points to the sample payment to show the severity of the deductions that defendant was
making. On the face of the sample payment, defendant paid an “independent contractor
settlement” in the gross amount of $5,159.19. Under the gross pay amount follow a series of
deductions whose abbreviations are not obvious but that appear to represent deductions for items
like insurance, maintenance, fuel, and commercial trucking plates. By the time defendant finished
making deductions, plaintiff had a net pay of $919.59. The sample payment also includes some yearto-date information. For the calendar year 2017 through June 16, 2017, plaintiff had a gross pay of
$39,363.87 and a net pay of $11,392.02. The record does not make clear to what extent plaintiff and
defendant discussed the amount of the deductions before plaintiff resorted to litigation. The record
as a whole, however, makes apparent that plaintiff grew unhappy with the amount of the deductions
and with the amount of net pay that he wound up taking home.

C. This litigation
Plaintiff commenced this case by filing a complaint, with potential collective and class action
claims, on February 16, 2018. (Dkt. No. 1.) The heart of plaintiff’s complaint is his concern that
the payment deductions that defendant subtracts from gross pay are large enough to implicate the
FLSA and the Labor Law:
Defendant makes substantial deductions from the paychecks of Plaintiff and
other drivers. These deductions are for the sole benefit of Defendant and include
items such as insurance, vehicle lease payments, vehicle maintenance payments, fuel,
on board recording device (which the Defendant uses to track the every move of its
drivers), occupational accidental insurance (workers’ compensation insurance), and
other miscellaneous expenses.
These deductions can be so significant that they sometimes result in Plaintiff
and other drivers being paid an hourly wage that falls below the minimum wage
required by the FLSA ($7.25 during all relevant times) and the NYLL (ranging from
$7.25 to $15.00 during the relevant six-year period and depending on work location).
For example, during the two-week period ending on February 3, 2018, Defendant
5

subjected Plaintiff to the following deductions: $1,868.45 for fuel; $343.82 for
insurance; $728.04 for the truck lease; $260.59 for vehicle maintenance; $17.00 for
the on board recording device lease fee; and $76.00 for workers’ compensation
insurance. In the wake of these deductions, Plaintiff was left with only $358.46 in
pay for a two-week period in which he worked approximately 70 hours.
(Dkt. No. 1 at 3–4.) Consequently, the complaint contains three claims or counts. In Count I,
plaintiff accuses defendant of paying below the minimum wage required by the FLSA. In Count II,
plaintiff accuses defendant of paying below the minimum wage required by the Labor Law. In
Count III, plaintiff accuses defendant of wage deductions that violated the Labor Law. Plaintiff
intends to seek a collective action under the FLSA for “all United States residents who, during any
time within the past three years, worked for Defendant as drivers and purportedly worked as nonemployee contractors.” (Id. at 4.) Plaintiff additionally intends to seek a class action under the
Labor Law for “all New York residents who, during any time within the past six years, worked for
Defendant as drivers and purportedly worked as non-employee contractors.” (Id.)
Defendant filed its motion to dismiss on May 23, 2018. Defendant argues that personal
jurisdiction cannot arise under New York’s long-arm jurisdiction statute:
Based on the totality of the circumstances, Liberty cannot be subject to
personal jurisdiction in New York. Indelicato’s claims arise from his agreement to
provide equipment and driving services for Liberty. Compl., ¶ 8. Indelicato and
Liberty negotiated and signed the Contractor Agreement in Pennsylvania. Runzo
Decl., ¶ 10. No employee of Liberty ever traveled to New York regarding
Indelicato’s agreement or that of any other contractor. Id., ¶ 18. In addition, the
Contractor Agreement Indelicato signed with Liberty includes a choice-of-law clause
requiring that all disputes related to the interpretation or enforcement of the
agreement be brought in Pennsylvania. Id., ¶ 11, Attachment 1, § 25. Moreover,
Liberty’s drivers perform an insignificant amount of driving through the state of
New York and rarely deliver into the state. Id., ¶¶ 15, 16. Indelicato himself spent
the vast majority of his time performing work outside the state. Id., ¶ 17. Liberty
has no property or employees in New York and makes all business decisions from its
headquarters in Pennsylvania. Id. ¶¶ 8, 14. Thus, there is no basis for this Court to
exercise personal jurisdiction over Liberty.
(Dkt. No. 9 at 7.) Defendant also distinguishes the New York contacts that plaintiff has highlighted
6

as his own contacts with New York, not its contacts with New York. (Dkt. No. 17 at 3.) With
respect to any analysis under the Due Process Clause, defendant asserts that it does not have the
necessary contacts with New York to establish general jurisdiction:
Plaintiff does not—indeed, he cannot—allege that Liberty is incorporated or
domiciled in New York or is otherwise “at home” in the state. Liberty is a
Pennsylvania company with its principal place of business in Pennsylvania. Runzo
Decl., ¶¶ 3, 4. Liberty maintains no property or employees in New York. Id., ¶ 8.
Less than 1% of the dispatched miles traveled by all Liberty contractors occur in
New York. Id., ¶ 16. Although Liberty is registered to do business in New York,
that alone is not enough to subject it to general jurisdiction. See Brown, 814 F.3d at
629, 641 (a corporation’s contacts in a state for general jurisdiction purposes must be
assessed not in isolation but in the context of the company’s overall activity, and
merely registering to do business or appointing an agent for service of process is
insufficient); Spratley v. FCA US LLC, No. 317CV0062MADDEP, 2017 WL
4023348, at *4 (N.D.N.Y. Sept. 12, 2017) (“after Daimler, registration to do business
in New York does not amount to consent to general jurisdiction”). There is no
question that Liberty is not subject to general jurisdiction in New York.
(Id. at 9; see also Dkt. No. 17 at 7 (asserting 145,228 miles in New York for defendant’s contractors in
2015, out of a total of nearly 20 million miles driven that year).) In a similar way, defendant argues
against specific jurisdiction as well:
For the same reasons this Court may not exercise personal jurisdiction under New
York’s long-arm statute, it may not exercise such jurisdiction under the Due Process
Clause—doing so would offend “traditional notions of fair play and substantial
justice.” Int’l Shoe, 326 U.S. at 316. Liberty contracted with Indelicato in
Pennsylvania to perform services across the country. Runzo Decl., ¶¶ 10, 12. All
contacts between Liberty and Indelicato occurred in Pennsylvania, and the
agreement Indelicato signed specifically selected Pennsylvania law to apply to it. Id.,
¶¶ 10, 11, 13, 14. Liberty does not have the minimum contacts with New York
required to subject it to the specific personal jurisdiction of this Court for
Indelicato’s wage claims.
(Dkt. No. 9 at 10.)
Plaintiff opposes defendant’s motion for several reasons. Plaintiff argues in favor of the
necessary minimum contacts between defendant in New York by reciting the advertising targeting
job applicants in the Buffalo area; defendant’s desire to have a New York route that would increase
7

Canadian business; the signing of documents in New York; the requirement to create a limited
liability corporation in New York; the numerous manifests that started, ended, or passed through
New York; and the delivery of pay stubs or violation notices to plaintiff’s home in New York. (Dkt.
No. 13 at 1–2.) Plaintiff then provides more specific details about the circumstances of his work:
Here, there is no dispute that Liberty has purposefully transacted business in
New York. In this regard, the Court is referred to the facts described in Section I
supra and the accompanying exhibits. As indicated, Liberty:
•

is registered to do business in New York;

•

obtained insurance in New York;

•

has contracted with around 10 New York drivers;

•

logged 145,228 miles of New York travel in a 2-year period;

•

has been cited in New York on 17 separate occasions for 34 safety
violations involving 14 separate truck tractors and 15 separate semitrailers;

•

employs a Dispatcher who purports work in the “Greater New York
City Area”;

•

regularly picks-up and drops-off delivery loads at New York facilities
owned by New York customers;

•

has sent executives (including Senior Vice President Runzo) to New
York to meet with vendors;

•

advertised for driver openings in the Buffalo, New York area;

•

actively recruited Plaintiff for a New York-based job and sent
contracts to his New York home; [and]

•

signed contracts that Plaintiff had already executed at his New York
home.

(Id. at 6.) Plaintiff additionally argues that, for purposes of the FLSA and the Labor Law, he should
be considered a statutory employee and not an independent contractor:
8

Moreover, there is a substantial relationship between Liberty’s abovedescribed New York activities and Plaintiff’s specific claims in this lawsuit. Here,
Plaintiff asserts that, even though he signed an independent contractor agreement, he
should be considered a statutory employee under the New York Labor Law and
FLSA because, inter alia, Liberty controlled and monitored his work. See Complaint
(Doc. 1) at ¶¶ 9, 27, and 31. As such, the independent contractor agreement that
Liberty sent to Plaintiff’s New York home and that Plaintiff signed in his New York
home will play an important role in this lawsuit. Also, in determining the extent of
Liberty’s control over Plaintiff’s work, the factfinder will be required to analyze the
relationship between Liberty and Plaintiff with respect to the work that Plaintiff
performed in New York state. As just one of many examples, Liberty fined Plaintiff
$75.00 for alleged violations found against Plaintiff during a safety inspection of his
vehicle in New York in May 2017. See Exhibit E. Liberty’s purported control over
Plaintiff is further evidenced by Plaintiff’s allegation that Liberty unilaterally dictated
the customers he serviced and the loads that he picked-up and dropped-off.
(Id.)
III.

DISCUSSION

A. Rule 12(b)(2) motions to dismiss generally
“When responding to a Rule 12(b)(2) motion to dismiss for lack of personal jurisdiction, the
plaintiff bears the burden of establishing that the court has jurisdiction over the defendant.” Bank
Brussels Lambert v. Fiddler Gonzalez & Rodriguez, 171 F.3d 779, 784 (2d Cir. 1999) (citation omitted).
“In deciding a pretrial motion to dismiss for lack of personal jurisdiction a district court has
considerable procedural leeway. It may determine the motion on the basis of affidavits alone; or it
may permit discovery in aid of the motion; or it may conduct an evidentiary hearing on the merits of
the motion. If the court chooses not to conduct a full-blown evidentiary hearing on the motion, the
plaintiff need make only a prima facie showing of jurisdiction through its own affidavits and
supporting materials. Eventually, of course, the plaintiff must establish jurisdiction by a
preponderance of the evidence, either at a pretrial evidentiary hearing or at trial. But until such a
hearing is held, a prima facie showing suffices, notwithstanding any controverting presentation by
the moving party, to defeat the motion.” Marine Midland Bank, N.A. v. Miller, 664 F.2d 899, 904 (2d
9

Cir. 1981) (citations omitted). “Those documents [i.e., submitted in the prima facie showing] are
construed in the light most favorable to plaintiff and all doubts are resolved in its favor.” CutCo
Indus., Inc. v. Naughton, 806 F.2d 361, 365 (2d Cir. 1986) (citation omitted).

B. Personal jurisdiction generally
“Federal courts ordinarily follow state law in determining the bounds of their jurisdiction
over persons.” Daimler AG v. Bauman, 571 U.S. 117, 125 (2014) (citing Fed. R. Civ. P. 4(k)(1)(A)).
“This is because a federal district court’s authority to assert personal jurisdiction in most cases is
linked to service of process on a defendant who is subject to the jurisdiction of a court of general
jurisdiction in the state where the district court is located.” Walden v. Fiore, 571 U.S. 277, 134 S. Ct.
1115, 1121 (2014) (internal quotation marks and citation omitted). State law will determine the
outermost boundaries here as well; the parties have not pointed out any provision of the FLSA that
would address those limits. With respect to state law, “[f]or a court to exercise general jurisdiction
over a defendant, 1) state law must authorize general jurisdiction; and 2) jurisdiction must comport
with constitutional due process principles.” Reich v. Lopez, 858 F.3d 55, 62 (2d Cir.), cert. denied, 138
S. Ct. 282, 199 L. Ed. 2d 127 (2017) (internal quotation marks and citation omitted). New York has
a statute that authorizes general jurisdiction. See N.Y. CPLR 301; Landoil Res. Corp. v. Alexander &
Alexander Servs., Inc., 565 N.E.2d 488, 490 (N.Y. 1990) (“A foreign corporation is amenable to suit in
New York courts under CPLR 301 if it has engaged in such a continuous and systematic course of
‘doing business’ here that a finding of its ‘presence’ in this jurisdiction is warranted.”) (citations
omitted). Whether general jurisdiction exists here thus reduces to the question of whether that
reach would violate federal constitutional due process principles.
“Constitutional due process assures that an individual will only be subjected to the
jurisdiction of a court where the maintenance of a lawsuit does not offend traditional notions of fair
10

play and substantial justice.” Waldman v. Palestine Liberation Org., 835 F.3d 317, 328 (2d Cir. 2016),
cert. denied sub nom. Sokolow v. Palestine Liberation Org., 138 S. Ct. 1438 (2018) (internal quotation marks
and citation omitted). “Even when the cause of action does not arise out of or relate to the foreign
corporation’s activities in the forum State, due process is not offended by a State’s subjecting the
corporation to its in personam jurisdiction when there are sufficient contacts between the State and
the foreign corporation.” Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 (1984)
(citations omitted). “For an individual, the paradigm forum for the exercise of general jurisdiction is
the individual’s domicile; for a corporation, it is an equivalent place, one in which the corporation is
fairly regarded as at home.” Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 924 (2011)
(citation omitted); see also Daimler AG, 571 U.S. at 137 (“With respect to a corporation, the place of
incorporation and principal place of business are paradigm bases for general jurisdiction.”) (internal
quotation and editorial marks and citations omitted). The phrase “paradigm forum” does not
necessarily mean the only way to establish general jurisdiction. See BNSF Ry. Co. v. Tyrrell, ___ U.S.
___, 137 S. Ct. 1549, 1558 (2017) (“The exercise of general jurisdiction is not limited to these
forums; in an ‘exceptional case,’ a corporate defendant’s operations in another forum may be so
substantial and of such a nature as to render the corporation at home in that State.”) (internal
quotation marks and citation omitted). Nonetheless, the Supreme Court has found only one such
“exceptional case” in the last 70 years. See generally Perkins v. Benguet Consol. Mining Co., 342 U.S. 437
(1952) (temporary relocation of a corporation from the Philippines to Ohio made Ohio the center of
corporate activity). Corporate activity in a state that constitutes only 5–10% of overall corporate
activity does not suffice. See BNSF, 137 S. Ct. at 1554. Sales activity, a regional office, and a
subsidiary relationship to another corporation are not enough. See Daimler AG, 571 U.S. at 139
(“Here, neither Daimler nor MBUSA is incorporated in California, nor does either entity have its
11

principal place of business there. If Daimler’s California activities sufficed to allow adjudication of
this Argentina-rooted case in California, the same global reach would presumably be available in
every other State in which MBUSA’s sales are sizable.”). Combining sales, employment, and a
physical presence in a state will not create general jurisdiction. See Brown v. Lockheed Martin Corp., 814
F.3d 619, 628 (2d Cir. 2016). Media and lobbying activities are not enough, either. See Waldman, 835
F.3d at 333.
With respect to specific jurisdiction, “New York decisions . . . at least in their rhetoric, tend
to conflate the long-arm statutory and constitutional analyses by focusing on the constitutional
standard: whether the defendant’s conduct constitutes purposeful availment of the privilege of
conducting activities within the forum State, thus invoking the benefits and protections of its laws.”
Best Van Lines, Inc. v. Walker, 490 F.3d 239, 247 (2d Cir. 2007) (internal quotation and editorial marks
and citations omitted).
“In order for a court to exercise specific jurisdiction over a claim, there must be an affiliation
between the forum and the underlying controversy, principally, an activity or an occurrence that
takes place in the forum State. When there is no such connection, specific jurisdiction is lacking
regardless of the extent of a defendant’s unconnected activities in the State.” Bristol-Myers Squibb Co.
v. Superior Court of California, San Francisco Cty., ___ U.S. ___, 137 S. Ct. 1773, 1781 (2017) (internal
quotation and editorial marks and citations omitted). “As a rule in these cases, [the Supreme Court]
has inquired whether there was some act by which the defendant purposefully availed itself of the
privilege of conducting activities within the forum State, thus invoking the benefits and protections
of its laws.” Goodyear, 564 U.S. at 924 (internal quotation and editorial marks and citations omitted).
The analysis “looks to the defendant’s contacts with the forum State itself, not the defendant’s
contacts with persons who reside there.” Walden, 134 S. Ct. at 1122 (citations omitted). In the
12

Second Circuit, “[t]hat analysis involves a consideration of the relationship among the defendant, the
forum, and the litigation. Where the defendant has had only limited contacts with the state it may be
appropriate to say that he will be subject to suit in that state only if the plaintiff’s injury was
proximately caused by those contacts. Where the defendant’s contacts with the jurisdiction that
relate to the cause of action are more substantial, however, it is not unreasonable to say that the
defendant is subject to personal jurisdiction even though the acts within the state are not the
proximate cause of the plaintiff’s injury.” Chew v. Dietrich, 143 F.3d 24, 29 (2d Cir. 1998) (internal
quotation marks and citations omitted).

C. Personal jurisdiction as applied here
With the general principles of personal jurisdiction in mind, the Court now turns to the
specific circumstances present here. Defendant is not incorporated in New York, and it does not
have a principal place of business here. Defendant has no assets in New York. Cf. Rates Tech. Inc. v.
Cequel Commc’ns, LLC, 15 F. Supp. 3d 409, 417 (S.D.N.Y. 2014) (“Moreover, the lack of an office,
employees, bank accounts, or property in the forum is significant.”). Defendant’s trucking business
in New York is neither a majority nor a substantial plurality of its overall business. Cf. Ontel Prod.,
Inc. v. Project Strategies Corp., 899 F. Supp. 1144, 1147 (S.D.N.Y. 1995) (finding personal jurisdiction
over an out-of-state defendant where “fully eighty percent of all nationwide orders are fulfilled by”
the local independent contractor). Plaintiff was an independent contractor with no authority to bind
defendant. Cf. Top Form Mills, Inc. v. Sociedad Nationale Industria Applicazioni Viscosa, 428 F. Supp.
1237, 1249 (S.D.N.Y. 1977)(finding personal jurisdiction where defendant’s agent “was authorized
under certain circumstances to confirm contracts in New York for Avandero’s [a freight forwarding
agency] services. He received copies of all documents and correspondence relating to individual
shipments by Avandero, acted as Avandero’s New York overseer of these shipments, and answered
13

or processed complaints from customers. On occasion he collected payments due Avandero.”).
That plaintiff might have signed his agreements in New York is not a significant factor and would
have been offset by the completion of arrangements in Pennsylvania to pick up the leased truck. Cf.
Lane v. Vacation Charters, Ltd., 750 F. Supp. 120, 124 (S.D.N.Y. 1990) (“Defendant’s unrefuted
evidence indicates that [a non-party acting for plaintiff] initiated contact with the defendant and
travelled to Philadelphia for negotiations. The contract was only mailed to her in New York for
signature. At no time did defendant’s employees travel to New York to conduct business.
Moreover, [the non-party] cannot be seen as defendant’s agent in this transaction.”). Plaintiff had
discretion to accept or to reject manifests as he wished. When he did accept manifests, plaintiff’s
duties did not include soliciting further business or making other logistical arrangements for
defendant. The record is not clear as to exactly how defendant would go about seeking new
business opportunities, but anything that it did in that regard did not involve plaintiff or New York
very much if at all. Cf. Riviera Trading Corp. v. Oakley, Inc., 944 F. Supp. 1150, 1156 (S.D.N.Y. 1996)
(“It is not enough that an independent contractor is present in New York, systematically soliciting
business for the corporation, no matter how substantial the orders.”) (internal quotation and
editorial marks and citations omitted); see also Williams v. Preeminent Protective Servs., Inc., 81 F. Supp. 3d
265, 269 (E.D.N.Y. 2015) (prima facie showing made where “Plaintiff was expected to be available
to defendants at all times, and was provided with a company-owned laptop, cellphone, and internet
hotspot for that purpose. Plaintiff’s duties included coordinating communications between
Preeminent’s central office and hundreds of its field employees via a text-messaging system she
implemented and operated from her home.”).
The nature of plaintiff’s manifests, alone or in conjunction with other factors that plaintiff
has cited, does not change the circumstances that the Court discussed above. As noted earlier,
14

defendant in its reply papers attached a complete list of all 167 manifests that plaintiff accepted
during the time when he worked for plaintiff. (Dkt. No. 17-1 at 5–12.) Defendant assessed the list
of manifests to conclude that plaintiff “incurred less than 10% of his miles in New York.” (Dkt.
No. 17 at 5.) To give plaintiff the benefit of the doubt for Rule 12 purposes, the Court has
examined the list of manifests a little differently. The Court agrees with defendant that 49 manifests
started or ended in New York. For an additional 34 manifests, however, the route began on one
side of New York—states such as Pennsylvania, Nebraska, or Oklahoma—and ended in a New
England state such as Connecticut or Massachusetts. Taking judicial notice of the geographical
necessity of passing through New York to reach New England states from Pennsylvania or points
farther west, the Court added these 34 manifests to the other 49 for a total of 83 manifests out of
167 that required at least some contact with New York. Additionally, if the Court generously gave
plaintiff the benefit of the doubt and counted all of the mileage for those 83 manifests as mileage
that had something to do with New York at some point then the total would amount to 33,659.1
miles out of 85,658, a rate of about 39 percent. The Court’s calculations come closer to plaintiff’s
informal estimates. Yet even with these more generous numbers, plaintiff has not shown that his
New York business amounted to more than a small percentage of the millions of miles that
defendant claims as its annual business. Cf. JetBlue Airways Corp. v. Helferich Patent Licensing, LLC, 960
F. Supp. 2d 383, 394 (E.D.N.Y. 2013) (dozens of licensing agreements worth millions of dollars “are
sufficient to permit an exercise of general personal jurisdiction”).
Consequently, all of the above factors3 push the Court to conclude that plaintiff has not

3

Because the above factors suffice to establish a lack of personal jurisdiction, the Court does not see the need
to address questions surrounding the choice-of-law provision in the Contractor Agreement (Dkt. No. 9-1 at
16): whether plaintiff’s claims concern the “interpretation or enforcement” of the agreement; whether a trial
court in Pennsylvania could enforce plaintiff’s federal and New York claims; and whether Pennsylvania law
would apply to any of plaintiff’s claims. If the choice-of-law provision did not apply at all then the above

15

made a prima facie showing of either general or specific jurisdiction. To hold otherwise “would
mean that a freight forwarder is subject to suit on any cause of action in any jurisdiction to which it
makes substantial shipments if, even without maintaining an office, it solicits such business there.”
Aquascutum of London, Inc. v. S. S. Am. Champion, 426 F.2d 205, 212 (2d Cir. 1970). Transfer of the
case to a more appropriate district might have been an option as an alternative to outright dismissal.
28 U.S.C. § 1406(a); see Minnette v. Time Warner, 997 F.2d 1023, 1027 (2d Cir. 1993)(ordering transfer
and noting that “the functional purpose of 28 U.S.C. § 1406(a) is to eliminate impediments to the
timely disposition of cases and controversies on their merits”) (citations omitted); accord WorldCare
Corp. v. World Ins. Co., 767 F. Supp. 2d 341, 365 (D. Conn. 2011) (citations omitted). The parties
have not mentioned transfer in their papers, however, and did not raise the issue at oral argument.
The Court accordingly will not address the issue further.
IV.

CONCLUSION
For all of the foregoing reasons, the Court respectfully recommends granting defendant’s

motion. (Dkt. No. 8.)
V.

OBJECTIONS
A copy of this Report and Recommendation will be sent to counsel for the parties by
electronic filing on the date below. “Within 14 days after being served with a copy of the
recommended disposition, a party may serve and file specific written objections to the proposed
findings and recommendations.” FRCP 72(b)(2); see also 28 U.S.C. § 636(b)(1). Any objections must
be filed electronically with the Clerk of the Court through the CM/ECF system.
“As a rule, a party’s failure to object to any purported error or omission in a magistrate

factors still would establish a lack of personal jurisdiction. If the choice-of-law provision required bringing
suit in Pennsylvania then it would be only one more factor establishing a lack of personal jurisdiction.

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judge’s report waives further judicial review of the point.” Cephas v. Nash, 328 F.3d 98, 107 (2d Cir.
2003) (citations omitted); see also Mario v. P & C Food Markets, Inc., 313 F.3d 758, 766 (2d Cir. 2002)
(“Where parties receive clear notice of the consequences, failure timely to object to a magistrate’s
report and recommendation operates as a waiver of further judicial review of the magistrate’s
decision.”) (citation omitted). “We have adopted the rule that failure to object timely to a magistrate
judge’s report may operate as a waiver of any further judicial review of the decision, as long as the
parties receive clear notice of the consequences of their failure to object. The rule is
enforced under our supervisory powers and is a nonjurisdictional waiver provision whose violation
we may excuse in the interest of justice.” United States v. Male Juvenile (95-CR-1074), 121 F.3d 34,
38–39 (2d Cir. 1997) (internal quotation marks and citations omitted).
“Where a party only raises general objections, a district court need only satisfy itself there is
no clear error on the face of the record. Indeed, objections that are merely perfunctory responses
argued in an attempt to engage the district court in a rehashing of the same arguments set forth in
the original papers will not suffice to invoke de novo review. Such objections would reduce the
magistrate’s work to something akin to a meaningless dress rehearsal.” Owusu v. N.Y. State Ins., 655
F. Supp. 2d 308, 312–13 (S.D.N.Y. 2009) (internal quotation and editorial marks and citations
omitted).
SO ORDERED.

__/s Hugh B. Scott________
DATED: August 16, 2018

Hon. Hugh B. Scott
United States Magistrate Judge

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