Patsoureas v. Choice Hotels International, Comfort Suites, and SNK Hotels, Inc.
MEMORANDUM (Order to follow as separate docket entry) re: 8 First MOTION to Dismiss for Lack of Jurisdiction filed by Choice Hotels International, Comfort Suites, and SNK Hotels, Inc. (See memo for complete details.)Signed by Chief Judge Christopher C. Conner on 8/9/17. (ki)
IN THE UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF PENNSYLVANIA
STEVE G. PATSOUREAS,
CHOICE HOTELS INTERNATIONAL, :
COMFORT SUITES, and SNK
CIVIL ACTION NO. 1:17-CV-555
(Chief Judge Conner)
Plaintiff Steve G. Patsoureas (“Patsoureas”) alleges that defendants Choice
Hotels International (“Choice Hotels”), Comfort Suites, and SNK Hotels, Inc.
(“SNK”)1 negligently failed to install or maintain a safety bar for the shower in his
hotel room, causing him severe injuries when he slipped and fell during his stay.
(See Doc. 2). Before the court is defendant SNK‟s motion (Doc. 8) to dismiss
Patsoureas‟s complaint for lack of personal jurisdiction pursuant to Federal Rule of
Civil Procedure 12(b)(2). FED. R. CIV. P. 12(b)(2). For the reasons that follow, the
court will grant the motion.
Defendant SNK Hotels, Inc. avers that “SNK Hotels, LLC” is the correct
name for SNK Hotels, Inc. and that SNK Hotels, Inc. does business as “Comfort
Suites.” (Doc. 9 at n.1). For the sake of brevity, the court will refer to defendant
SNK Hotels, Inc. as “SNK.”
Factual Background & Procedural History
SNK is an Ohio limited liability company with its principal place of
business at 1234 Omni Plex Drive in Cincinnati, Ohio.2 (Doc. 8-3 ¶ 2; see Doc. 2 ¶ 4).
“Comfort Suites” is the brand name under which SNK operates its hotel, which is
also located at 1234 Omni Plex Drive. (Doc. 2 ¶¶ 3-4; Doc. 8-3 ¶ 3). Patsoureas
currently resides in York, Pennsylvania. (Doc. 2 ¶ 1).
On May 26, 2016, Patsoureas purchased an overnight stay at SNK‟s Comfort
Suites in Cincinnati, Ohio. (Id. ¶ 6). Patsoureas attempted to use the shower within
his room the next day. (Id. ¶ 7). Unfortunately, Patsoureas slipped and fell,
sustaining severe injuries. (Id. ¶ 10).
Plaintiff commenced this action in the Court of Common Pleas for Dauphin
County on February 24, 2017. (Doc. 2). Defendants removed the action to the
Middle District of Pennsylvania. (Doc. 1). On May 8, 2017, SNK filed the instant
motion to dismiss. (Doc. 8). The motion is fully briefed (Docs. 9, 15, 16) and ripe for
Pursuant to Federal Rule of Civil Procedure 12(b)(2), a party may move to
dismiss a complaint for lack of personal jurisdiction. FED. R. CIV. P. 12(b)(2). In
Patsoureas alleges in his complaint that SNK is an Arizona company.
(Doc. 2 ¶ 4). SNK remonstrates that it is not affiliated with the alleged office in
Arizona, and that it is an Ohio limited liability company. (Doc. 9 at 2; see Doc. 8-3
¶ 1). Patsoureas does not respond to this statement in his briefing. (See Doc. 15 at
1-2). Hence, the court finds that Patsoureas has effectively waived this contention
as to SNK‟s place of incorporation. See D‟Angio v. Borough of Nescopeck, 34 F.
Supp. 2d 256, 265 (M.D. Pa. 1999).
ruling on a Rule 12(b)(2) motion, the court must accept the allegations in the
complaint as true and draw all reasonable inferences supported by the well-pleaded
factual allegations in the plaintiff‟s favor. Pinker v. Roche Holdings Ltd., 292 F.3d
361, 368 (3d Cir. 2002); Carteret Sav. Bank, FA v. Shushan, 954 F.2d 141, 142 n.1
(3d Cir. 1992). The court‟s review is not limited to the face of the pleadings, as
consideration of affidavits submitted by the parties is both appropriate and
required. See Carteret Sav. Bank, 954 F.2d at 146.
Although the plaintiff bears the ultimate burden of proving personal
jurisdiction over a defendant, Mellon Bank (East) PSFS Nat‟l Ass‟n v. Farino, 960
F.2d 1217, 1223 (3d Cir. 1992), the plaintiff need not make such a showing at the
pleading stage of litigation. Metcalfe v. Renaissance Marine, Inc., 566 F.3d 324, 330
(3d Cir. 2009). To survive a motion to dismiss, the plaintiff must merely allege
sufficient facts to establish a prima facie case of jurisdiction over the defendant. Id.;
Carteret Sav. Bank, 954 F.2d at 142 n.1. When claims of jurisdiction are not clearly
frivolous, courts ordinarily allow jurisdictional discovery. See Metcalfe, 566 F.3d at
335-36 (citing Compagnie Des Bauxites de Guinee v. L‟Union Atlantique S.A.
d‟Assurances, 723 F.2d 357, 362 (3d Cir. 1983)).
SNK argues that it lacks sufficient minimum contacts with Pennsylvania
to justify the court‟s exercise of personal jurisdiction. (Doc. 8 at 2-3). SNK avers
that it does not: (1) conduct business in the Commonwealth, (2) hold any offices or
employees in the Commonwealth, (3) own property in the Commonwealth, or (4)
advertise or solicit business in the Commonwealth. (Id. at 5; Doc. 9 at 7-10).
Patsoureas rejoins that SNK purposefully directed its activities at the
Commonwealth by operating as part of Choice Hotels, which provides services
within the state of Pennsylvania. (Doc. 15 at 2).
A federal court may assert jurisdiction over a nonresident of the forum
state to the extent authorized by the law of the forum. See FED. R. CIV. P. 4(k)(2).
The Pennsylvania Long-Arm Statute grants jurisdiction coextensive with that
permitted by the Due Process Clause of the Fourteenth Amendment. 42 PA. CONS.
STAT. § 5322(b). The court‟s constitutional inquiry is guided by the “minimum
contacts” test established in International Shoe Co. v. Washington, 326 U.S. 310
(1945). Under this test, the plaintiff must show that the nonresident defendant has
“certain minimum contacts with [the forum] such that the maintenance of the suit
does not offend traditional notions of fair play and substantial justice.” Int‟l Shoe,
326 U.S. at 316 (internal quotations and citation omitted); see Marten v. Godwin,
499 F.3d 290, 296 (3d Cir. 2007). The focus of the minimum contacts analysis is “the
relationship among the defendant, the forum, and the litigation,” Shaffer v. Heitner,
433 U.S. 186, 204 (1977), such that the defendant has fair warning that he may be
subject to suit in that forum. Gen. Elec. Co. v. Deutz AG, 270 F.3d 144, 150 (3d Cir.
2001); Marten, 499 F.3d at 296. “[T]he mere unilateral activity of those who claim
some relationship with a nonresident defendant cannot satisfy the requirement of
contact with the forum State.” World-Wide Volkswagen Corp. v. Woodson, 444 U.S.
286, 298 (1980) (internal citation omitted).
A federal court must possess one of two forms of personal jurisdiction to
comport with these principles. See D‟Jamoos ex rel. Estate of Weingeroff v. Pilatus
Aircraft Ltd., 566 F.3d 94, 102 (3d Cir. 2009) (citing Helicopteros Nacionales de
Colombia v. Hall, 466 U.S. 408, 414-15 (1984)). General jurisdiction allows a court to
exercise its jurisdiction over any party that possesses “continuous and systematic”
contacts with the forum state, regardless of whether the claim arises out of the
party‟s forum-related activities. Helicopteros, 466 U.S. at 415 n.9; Marten, 499 F.3d
at 296. Specific jurisdiction, on the other hand, allows the court to hear claims
arising out of or relating to the party‟s contacts with the forum state. Helicopteros,
466 U.S. at 414 n.8; Telcordia Tech Inc. v. Telkom SA Ltd., 458 F.3d 172, 177 (3d Cir.
Patsoureas asserts only general jurisdiction based on SNK‟s relationship
with Choice Hotels. (Doc. 15 at 2). The issue central to the general jurisdiction
determination is whether the defendant maintains “perpetual, abiding ties with
the forum.” In re Chocolate Confectionary Antitrust Litigation, 674 F. Supp. 2d
580, 596-97 (M.D. Pa. 2009) (“Chocolate II”). In these cases it is not the quantity
of contacts that is significant, but the quality of those contacts. Compare Perkins
v. Benguet Consol. Mining Co., 342 U.S. 437, 445 (1952) with Helicopteros, 466 U.S.
at 416-18. Contacts giving rise to jurisdiction must be “the bread and butter of [the
defendant‟s] daily business.” Provident Nat‟l Bank v. California Federal Sav. &
Loan Ass‟n., 819 F.2d 434, 438 (3d Cir. 1987); see also Chocolate II, 674 F. Supp. 2d
at 598 n.24 (citing Metcalfe, 566 F.3d at 335). SNK contends that its complete lack
of contact with Pennsylvania, as well as the tenuous connection between SNK‟s
individual hotel and the overarching brand name, does not comport with traditional
notions of fair play and substantial justice. (Doc. 9 at 6-7; Doc. 16 at 2). We agree
that the complaint is devoid of allegata sufficient to establish general jurisdiction on
A plaintiff may also assert an alter ego relationship between a parent
company and its subsidiary as an alternate means of establishing a court‟s
jurisdiction over a defendant. Chocolate II, 674 F. Supp. 2d at 598. The hallmarks
of an alter ego relationship are invasive control by a parent corporation over its
subsidiary, and disregard for traditional corporate boundaries. See 16 JAMES WM.
MOORE ET AL., MOORE‟S FEDERAL PRACTICE ¶ 108.42 (3d. ed. 2012). Such control
must exceed the usual supervision that a parent exercises over a subsidiary. See
Kehm Oil Co. v. Texaco, Inc., 537 F.3d 290, 300-01 (3d Cir. 2008); Chocolate II, 674
F. Supp. 2d at 598 (citing Simeone ex rel. Estate of Albert Francis Simeone, Jr.
v. Bombardier-Rotax GmbH, 360 F. Supp. 2d 665, 675 (E.D. Pa. 2005)). Hence, to
establish an alter ego scenario, the parent company‟s control must go beyond mere
monitoring of the subsidiary‟s business plans and profitability; it must rise to the
level of interference with the subsidiary‟s day-to-day operations. See United States
v. Bestfoods, 524 U.S. 51, 69 (1998). Even when a parent corporation interferes with
daily operations, that interference alone may not be determinative. If a parent and
subsidiary continue to respect traditional corporate boundaries by maintaining, for
example, their own bylaws, articles of incorporation, and boards of directors, “the
subsidiary will not be deemed to be the „alter ego‟ of the parent, no matter how
much control the parent exercises.” Poe v. Babcock Int‟l., PLC, 662 F. Supp. 4, 6
(M.D. Pa. 1985).
Courts evaluate corporate dependence in light of whether:
(1) the parent owns all or a significant majority of the
(2) commonality of officers or directors exists between the
(3) the group possesses a unified marketing image,
including common branding of products,
(4) corporate insignias, trademarks, and logos are uniform
across corporate boundaries,
(5) group members share employees,
(6) the parent has integrated its sales and distribution
systems with those of its subsidiaries,
(7) the corporations exchange or share managerial or
(8) the subsidiary performs business functions that would
ordinarily be handled by a parent corporation,
(9) the parent uses the subsidiary as a marketing division
or as an exclusive distributor, and
(10) the parent exercises control or provides instruction to
the subsidiary‟s officers and directors.
In re Chocolate Confectionary Antitrust Litig., 602 F. Supp. 2d 538, 569-70 (M.D.
Pa 2009) (citing Simeone, 360 F. Supp. 2d at 675); accord Genesis Bio. Pharms.
v. Chiron Corp., 27 F. App‟x 94, 98 (3d Cir. 2002). No single factor is dispositive.
Simeone, 360 F. Supp. 2d at 675. The court may also consider any evidence bearing
on the corporations‟ functional interrelationship. Id. Plaintiffs may rely upon an
alter ego connection to acquire jurisdiction over either a foreign parent or a foreign
subsidiary based upon their relationship with an in-forum entity. Id.
Patsoureas asks the court for jurisdictional discovery to establish personal
jurisdiction based on SNK‟s relation to its parent company, Choice Hotels. (Doc. 15
at 2). Patsoureas has the burden of demonstrating a prima facie case of personal
jurisdiction in order to qualify for jurisdictional discovery. Metcalfe, 566 F.3d at
335-36; Carteret Sav. Bank, 954 F.2d at 146. Patsoureas fails to meet this burden.
Patsoureas cannot prove a prima facie case by resting on the bare
allegations of his complaint as he does sub judice. He merely avers that Choice
Hotels “supervises and sets forth protocols in the operations of the hotels which are
a part of its group including [SNK‟s] Comfort Suites in Cincinnati, Ohio.” (Doc. 15
at 2). This broad allegation establishes only that SNK is a subsidiary of Choice
Hotels, which is insufficient to establish a prima facie case of personal jurisdiction
based on an alter ego theory. See Kehm, 537 F.3d at 300-01; Chocolate II, 674 F.
Supp. 2d at 598. Patsoureas does not adduce any supplemental materials which
would support a finding of alter ego jurisdiction. The court requires more than
mere speculation of an alter ego relationship to subject SNK to general jurisdiction
The court will grant SNK‟s motion (Doc. 8) to dismiss for lack of personal
jurisdiction. An appropriate order shall issue.
/S/ CHRISTOPHER C. CONNER
Christopher C. Conner, Chief Judge
United States District Court
Middle District of Pennsylvania
August 9, 2017
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