Hall, R. v. Husqvarna Professional Products ( 2022 )

J-A07034-22
NON-PRECEDENTIAL DECISION - SEE SUPERIOR COURT I.O.P. 65.37
REBECCA QUINN HALL, AS : IN THE SUPERIOR COURT OF
ADMINISTRATIX OF THE ESTATE OF : PENNSYLVANIA
ROBERT ERIC HALL DECEASED :
:
v. :
:
HUSQVARNA PROFESSIONAL :
PRODUCTS, N.A., INC., HUSQVARNA :
PROFESSIONAL PRODUCTS, INC., :
HUSQVARNA AB, HUSQVARNA :
GROUP, HUSQVARNA AND MADLE'S :
HARDWARE, INC. AND MADLE'S :
HARDWARE :
:
:
APPEAL OF: HUSQVARNA :
PROFESSIONAL PRODUCTS, INC. : No. 1026 EDA 2021
Appeal from the Order Entered May 14, 2021
In the Court of Common Pleas of Philadelphia County
Civil Division at No(s): 201001099
REBECCA QUINN HALL, AS : IN THE SUPERIOR COURT OF
ADMINISTRATIX OF THE ESTATE OF : PENNSYLVANIA
ROBERT ERIC HALL :
:
v. :
:
HUSQVARNA PROFESSIONAL :
PRODUCTS, N.A., INC., HUSQVARNA :
PROFESSIONAL PRODUCTS, INC., :
HUSQVARNA AB, HUSQVARNA :
GROUP, HUSQVARNA, MADLE'S :
HARDWARE, INC., AND MADLE'S :
HARDWARE :
:
:
APPEAL OF: MADLE'S HARDWARE, :
INC., AND MADLE'S HARDWARE : No. 1162 EDA 2021
J-A07034-22
Appeal from the Order Entered May 14, 2021
In the Court of Common Pleas of Philadelphia County
Civil Division at No(s): 201001099
BEFORE: DUBOW, J., McLAUGHLIN, J., and KING, J.
MEMORANDUM BY KING, J.: FILED JUNE 24, 2022
Appellants, Husqvarna Professional Products, N.A., Inc., Husqvarna
Professional Products, Inc., Husqvarna AB, Husqvarna Group, Husqvarna
(collectively, “HPP”)1 and Madle’s Hardware, Inc. and Madle’s Hardware
(collectively, “Madle’s Hardware”), appeal from the order entered in the
Philadelphia County Court of Common Pleas, which overruled their preliminary
objections to venue in Philadelphia County.2 We affirm.
In its opinion, the trial court set forth the relevant facts and procedural
history of this case as follows.
On or about October 20, 2018, Decedent was operating a
lawn tractor at his property in Coopersburg, PA, Lehigh
County, when “the tractor unexpectedly rolled and caused
Decedent to fall off the tractor onto his right foot and leg
and then onto the ground.” Decedent sustained a rupture
of his right patellar tendon which required surgical repair on
October 29, 2018. On November 25th, 2018, Decedent died
from a pulmonary embolism, alleged to have resulted from
the injuries he suffered to his right knee on October 20,
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1 The parties stipulated to the dismissal of some of the HPP defendants prior
to this appeal.
2 This appeal is properly before us pursuant to Pa.R.A.P. 311(b)(2) (stating
appeal may be taken as of right from order in civil action or proceeding
sustaining venue of matter or jurisdiction over person or over real or personal
property if court states in order that substantial issue of venue or jurisdiction
is presented).
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2018. As a result, on October 15, 2020, [Appellee Rebecca
Quinn Hall, as administratrix of the estate of Decedent
Robert Eric Hall,] filed the instant action by way of a civil
complaint.
[Appellee’s] complaint names multiple defendants, all of
whom fall into two distinct categories: [HPP] and [Madle’s
Hardware]. [Madle’s Hardware is] located in Coopersburg,
PA, Lehigh County. It is not averred that [Madle’s
Hardware] regularly conduct[s] business in Philadelphia
County. Therefore, whether venue is proper in Philadelphia
County is reliant on a finding that [HPP] regularly conduct[s]
business in Philadelphia.[3]
[HPP] in the instant matter [is] the same [group of]
defendants as [those] in [Hangey v. Husqvarna
Professional Products, Inc., 247 A.3d 1136 (Pa.Super.
2021) (en banc)]. Identical to the Plaintiff in Hangey,
[Appellee] alleges in the instant matter [that HPP] regularly
conduct[s] business in Philadelphia, whereas the other
named Defendants have no relation to Philadelphia County.
HPP is a Delaware corporation with a principal place of
business in Charlotte, North Carolina. HPP primarily sells
lawn and garden equipment, including riding lawn tractors.
… HPP is not registered to do business in Philadelphia
County. HPP also does not rent, own or utilize any
warehouses or other facilities in Philadelphia County. HPP
does not have any addresses or telephone numbers in
Philadelphia County. HPP does not own or rent any real
property in Philadelphia County. HPP does not have any
officers or employees residing in or based out of Philadelphia
County.
On November 9, 2020 and November 11, 2020, [HPP] and
[Madle’s Hardware], respectively, filed preliminary
objections claiming venue is improper in Philadelphia
County. On November 30, 2020, [Appellee] filed answers
to both [Appellants’] preliminary objections. On December
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3 See Pa.R.C.P. 1006(c)(1) (stating “an action to enforce a joint or joint and
several liability against two or more defendants…may be brought against all
defendants in any county in which the venue may be laid against any one of
the defendants…”).
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8, 2020, this [c]ourt issued a rule to show cause allowing all
parties until January 26, 2021 to take discovery and file
supplemental briefs on the issue of improper venue. On
December 22, 2020, [HPP] filed both a motion for
reconsideration and motion to stay proceedings, asking this
[c]ourt to not rule on the instant preliminary objections until
the Superior Court’s en banc panel issued an opinion in …
[Hangey]. On January 11, 2021, this [c]ourt denied said
motions, however, on January 14, 2021, this [c]ourt
granted a request for an extension of time to file
supplemental briefs until February 15, 2021. On February
15, 2021, all parties submitted to this [c]ourt supplemental
briefs on the issue of improper venue.
On March 8, 2021, the Superior Court filed its en banc
opinion in Hangey[.] …[T]he en banc panel in the Superior
court overturned the Philadelphia Trial Court opinion that
[HPP] did not regularly conduct business in Philadelphia
County. On March 10, 2021, [Appellee] filed a second
supplemental brief as a result of the decision in Hangey.
On March 11, 2021, [HPP] also filed a second supplemental
brief addressing Hangey, in which [HPP] stated [its]
intention to petition for allowance of appeal to the PA
Supreme Court [in that case]. On March 16, 2021, [Madle’s
Hardware] filed a second supplemental brief adopting the
position of [HPP’s] second supplemental brief. On April 7,
2021, [HPP] filed a petition for allowance of appeal to the
PA Supreme Court [in Hangey] under the docket number
147 EAL 2021.
On May 14, 2021, this [c]ourt entered an Order overruling
[Appellants’] preliminary objections [based on the Hangey
decision]. …
On May 18, 2021, [HPP] filed an Appeal to the Superior
Court. On June 9, 2021, Madle’s Hardware…filed an Appeal
to the Superior Court. On June 15, 2021, this [c]ourt
entered an Order pursuant to Pa.R.A.P. 1925(b) ordering
[Appellants] to file a statement of matters complained of on
appeal. On July 6, 2021 and July 7, 2021, Madle’s
Hardware…and [HPP], respectively, filed a statement of
matters complained of on appeal pursuant to Pa.R.A.P.
1925(b). On August 31, 2021, the Superior Court granted
an order for consolidation of the…appeals.
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(Trial Court Opinion, filed 9/24/21, at 1-4) (internal citations to record and
footnotes omitted). On May 10, 2022, the Supreme Court granted allowance
of appeal in Hangey. Thereafter, Appellants filed an application to stay in
this Court pending the Supreme Court’s decision in Hangey. We denied
Appellants’ application on May 18, 2022.
Appellants raise one issue for our review:
Did the trial court misapply the law and rule unreasonably—
thereby abusing its discretion—by eschewing the required
case-by-case application of the quality-quantity test for
venue and instead categorically applying this Court’s holding
in Hangey v. Husqvarna Prof. Prods. to determine that
[HPP] regularly conducted business in Philadelphia County
under Rule 2179(a)(2)?
(Appellants’ Brief at 3).
Appellants argue the trial court improperly concluded that HPP regularly
conducts business in Philadelphia County. Appellants assert that the trial court
was not bound by this Court’s en banc decision in Hangey and it should have
conducted an analysis based on the facts of this case. Appellants insist the
record evidence in this case materially differs from the record evidence in
Hangey. Appellants emphasize that HPP’s business contacts in Philadelphia
are de minimis such that the quantity prong of the venue test is not satisfied.
Appellants submit that HPP’s sales in Philadelphia during 2019 should drive
the analysis because it shows a “snapshot of the case” at the time it was
initiated. Thus, Appellants contend that HPP’s sales in Philadelphia between
2014-2020 are not relevant. Appellants also claim Appellee’s “estimation” of
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HPP’s sales in Philadelphia between 2014-2020 is speculative.
In any event, Appellants maintain that HPP’s sales in Philadelphia ranged
from 0.003% to 0.017% of its national sales between 2014-2020, which is an
average of only 0.009%. During 2019, Appellants insist HPP’s sales in
Philadelphia were approximately 0.003% of its national sales. Appellants
contend the dollar amount of business conducted in Philadelphia in 2019 is
materially less than that at issue in Hangey. In sum, Appellants maintain
HPP’s business activities in Philadelphia are not continuous and sufficient.
Aside from HPP’s de minimis sales in Philadelphia, Appellants claim HPP
lacked the other sorts of qualifying business contacts that, when coupled with
the company’s local sales, could possibly support a finding that the company
was regularly conducting business in the chosen forum. For example,
Appellants stress that HPP is not registered to do business in Philadelphia,
does not own, rent, or utilize any facilities in Philadelphia, does not have any
addresses or telephone numbers in Philadelphia, does not have any officers or
employees residing or based in Philadelphia, and has not entered into any
contracts with the local government. Appellants submit that any alleged
online advertising HPP conducts to “target” Philadelphia County is irrelevant
to the trial court’s analysis because advertising does not satisfy the quality
prong of the test. Likewise, Appellants posit that the existence of product
warranties or product registrations tied to Philadelphia residents does not
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satisfy the quality prong of the test, where such warranties “are collateral and
incidental” to HPP’s corporate purpose to sell lawn and garden equipment.
Further, Appellants insist that the allegedly voluminous sales of HPP
products to consumers at Lowe’s stores in Philadelphia County are of no
moment because those are Lowe’s sales—not HPP’s sales. Appellants explain
that HPP generates its revenue by selling the products in question to Lowe’s
outside of Philadelphia; if and when Lowe’s later sells the products to
consumers at one of its Philadelphia stores would evince Lowe’s doing
business in Philadelphia, not HPP. Appellants conclude the court abused its
discretion in overruling their preliminary objections to venue, and this Court
must reverse and remand for transfer of venue to Lehigh County. We
disagree.
This Court has explained:
The trial court is accorded considerable discretion in
determining whether or not to grant a petition for change of
venue, and the standard of review is one of abuse of
discretion. The plaintiff’s choice of forum is given great
weight. Thus, the party seeking a change of venue bears
the burden of proving that a change of venue is necessary,
while a plaintiff generally is given the choice of forum so
long as the requirements of personal and subject matter
jurisdiction are satisfied.
In determining whether a corporation or partnership
regularly conducts business in a county, we employ a
quality-quantity analysis. … A business entity must perform
acts in a county of sufficient quality and quantity before
venue in that county will be established. Quality of acts will
be found if an entity performs acts in a county that directly
further or are essential to the entity’s business objective;
incidental acts in the county are not sufficient to meet the
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quality aspect of the test. Acts that aid a main purpose are
collateral and incidental while those necessary to an entity’s
existence are direct. [Purcell v. Bryn Mawr Hospital, 525
Pa. 237, 579 A.2d 1282 (1990)] (incidental acts include
advertising, solicitation of business from a county,
education programs for personnel in county, hiring of
personnel from the county, and purchase of supplies from
county); see also Krosnowski v. Ward, 836 A.2d 143,
147 (Pa.Super.2003) (en banc) (business referrals to and
from an independently operated business entity in another
county do not establish venue in that county as referrals
were in aid of main business purpose and not actual conduct
of business in that county). Quantity of acts means those
that are sufficiently continuous so as to be considered
habitual. Each case must be based upon its own individual
facts.
Zampana-Barry v. Donaghue, 921 A.2d 500, 503-04 (Pa.Super. 2007),
appeal denied, 596 Pa. 709, 940 A.2d 366 (2007) (some internal citations and
quotation marks omitted). See also Pa.R.C.P. 2179(a)(2) (stating venue is
proper against corporation or similar entity in county where it “regularly
conducts business”). “Further, the venue rules exclusively address where
venue properly may be laid at the time the suit is initiated. Thus, question of
improper venue is answered by taking a snapshot of the case at the time it is
initiated; if it is ‘proper’ at that time, it remains ‘proper’ throughout the
litigation.” Hausmann v. Bernd, 271 A.3d 486, 493 (Pa.Super. 2022)
(internal citation omitted).
“Pennsylvania appellate courts have often considered the percentage of
overall business a defendant company conducts in a county to determine if
the quantity prong was met.” Hangey, supra at 1141.
[C]ourts often consider whether the percentage of a
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defendant’s business is sufficient to constitute “habitual”
contact. However, no court has stated that the percentage
of a defendant’s business is the sole evidence relevant to
the “quantity” analysis. Rather, courts must determine
whether all the evidence presented, including the scope of
the defendant’s business, viewed in the context of the facts
of the case, establish that a defendant’s contacts with the
venue satisfy the quantity prong.
Where this Court concluded that conducting a small
percentage of a business in a venue did not satisfy the
quantity prong, the Court’s core finding was that the
contacts failed the quality prong of the venue test and the
cases often addressed defendants who were small and/or
local companies, not multi-billion-dollar corporations. …
* * *
The percentage of a company’s overall business that it
conducts in a given county, standing alone, is not
meaningful and is not determinative of the “quantity” prong.
Each case turns on its own facts, and we must evaluate
evidence of the extent of a defendant’s business against the
nature of the business at issue. A small or local business
may do all of its work in just a few counties or even a single
one, while a large business may span the entire nation.
Indeed, the percentage of sales a multi-billion-dollar
company makes in a particular county will almost always be
a tiny percentage of its total sales. Courts thus should not
consider percentages in isolation. Rather, courts must
consider all of the evidence in context to determine whether
the defendant’s business activities in the county were
regular, continuous, and habitual.
Id. at 1141-42 (internal citations omitted) (emphasis in original). See also
Dibble v. Page Transportation, Inc., No. 565 EDA 2021, 2021 WL 5408725(Pa.Super. filed Nov. 19, 2021) (unpublished memorandum at *6)4 (stating:
____________________________________________
4See Pa.R.A.P. 126(b) (stating we may rely on unpublished decisions of this
Court filed after May 1, 2019 for persuasive value).
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“[I]n analyzing the quantity prong of the test, the number of contacts with
Philadelphia County is to be considered from the perspective of the county
rather than solely from that of the business. While a percentage of sales in a
county may be miniscule viz-a-viz the company’s overall sales, they may
nonetheless amount to systematic, continuous and habitual, and therefore
‘regular,’ business in the county”).
In Hangey, the Hangeys filed a complaint in Philadelphia County in
March 2017 against HPP and Trumbauer’s Lawn and Recreation, Inc., after Mr.
Hangey was maimed when he fell off his lawnmower and the lawnmower ran
over his legs while the blades were still engaged. The accident occurred in
Wayne County. The defendants filed preliminary objections alleging improper
venue. Discovery related to the issue of venue revealed, inter alia, that in
2016, HPP had approximately $1.4 billion in sales revenue in the United
States, of which $75,310.00 came from direct sales in Philadelphia County.
Of the $75,000 in sales made in Philadelphia in 2016, roughly $69,700 came
from a single Husqvarna authorized dealer, DL Electronics, Inc. Approximately
0.005% of HPP’s 2016 United States sales revenue resulted from direct sales
in Philadelphia County.
Sales data from 2014 and 2015 was substantially similar, with
approximately 0.005% of annual United States sale revenue resulting from
direct sales within Philadelphia County. These figures did not include the
revenue generated by selling products at retailers such as Home Depot,
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Lowe’s, or Sears. In the case of “big box” retailers, John Stanfield, the
corporate representative for HPP, testified that HPP delivers its products to
the retailers’ distribution centers, none of which are located in Philadelphia
County. The retailers then retain sole discretion as to where the products are
offered for sale, including stores located in Philadelphia County. See id. at
1139. Following oral argument, the trial court sustained the preliminary
objections and transferred venue to Bucks County. The Hangeys appealed.
This Court, sitting en banc, reversed the trial court’s decision.5 In doing
so, this Court held:
Here, HPP is a multi-billion-dollar corporation. It had at
least one authorized dealer located in Philadelphia to which
it delivered products for sale. Although HPP’s sales through
authorized dealers in Philadelphia constituted only 0.005%
of HPP’s national sales, the dollar figure of those
Philadelphia sales in 2016 was $75,310. The number and
dollar figure of sales in Philadelphia, and the fact that
HPP has an authorized dealer in Philadelphia to sell
its products, is relevant to the determination of
whether HPP’s contacts with Philadelphia satisfied
the “quantity” prong of the venue analysis. Therefore,
we conclude the trial court erred in relying almost
exclusively on evidence of the percentage of defendant’s
business that occurred in Philadelphia when addressing the
quantity prong.
Further, based on the totality of the evidence, HPP’s
contacts satisfied the quantity prong of the venue test. Its
contacts with Philadelphia—including having an authorized
dealer in Philadelphia, and selling $75,310 worth of products
through that dealer in 2016 in Philadelphia—were
“sufficiently continuous so as to be considered habitual.”
See Zampana-Barry, 921 A.2d at 504.
____________________________________________
5 Judge Stabile wrote a dissent, which this author joined.
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In reaching this conclusion, we do not find it necessary to
approve or disapprove of any of our prior decisions. Rather,
our conclusion is based on the prior precedents of the
Pennsylvania Supreme Court and consistent with those of
our Court. However, as discussed above, we clarify that the
percentage of sales of a corporation in a venue is but one
factor to consider when determining whether the quantity
prong of the venue analysis is satisfied, and such evidence
must be viewed within the context of the business at issue
in each case.
Hangey, supra at 1142-43 (internal footnote omitted) (emphasis added).
This Court noted that venue was proper in Philadelphia without reference to
sales from Lowe’s or similar stores. Id. at 1142 n.2. This Court further stated
that there was no challenge to the trial court’s finding that the quality prong
of the venue test was met. Id. at 1143. Accordingly, this Court reversed the
order sustaining the preliminary objections to venue.
Instantly, the trial judge in this case is the same trial judge who presided
in Hangey. The court offered the following rationale for overruling Appellants’
preliminary objections:
It was this [c]ourt’s decision in Hangey, due to the facts
Plaintiff provided on the record, that [HPP] did not regularly
conduct business in Philadelphia County. This [c]ourt
decided the evidence produced by the Hangey Plaintiffs,
expressly noting $75,310 worth of sales amounting to
.005% of [HPP’s] total revenue in 2016, was not enough to
overcome the jurisdictional challenge of [HPP]. Ultimately,
on March 8, 2021, an en banc panel of the Superior Court
held that Plaintiff had not met their burden and it was an
abuse of this [c]ourt’s discretion to decide [HPP] did not
regularly conduct business in Philadelphia County. While
this [c]ourt still believes it did not abuse its discretion in
rendering its opinion, it respects and remains deferential to
the opinion of the Superior Court.
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In the instant matter, [Appellee relies] on identical
arguments and elements of proof. As such, since the instant
matter involves the exact same question about [HPP]
addressed by the Superior Court in Hangey, whether [HPP]
regularly conduct[s] business in Philadelphia County, this
[c]ourt is bound by that decision.
7 This [c]ourt recognizes [Appellee has] a less
complete picture of the applicable sales numbers in
the relevant years in the instant matter than the
Plaintiffs in Hangey, as [Appellee] did not provide this
[c]ourt with sales figures for the year 2018 (the year
of the accident) or the year 2020 (the year the instant
matter was initiated). [Appellee] did, however,
provide this [c]ourt with the following figures: In
2018, 2019, and 2020, respectively, the percentage
of Philadelphia based sales was .017%, .003% and
.010%. …
(Trial Court Opinion at 7-8).
The record supports the trial court’s analysis. Here, John Stanfield, the
Assistant Secretary for the parent company of HPP provided deposition
testimony on February 8, 2021. Mr. Stanfield confirmed that HPP has four
authorized independent dealers in Philadelphia. Those dealers are not the
same as “big box” retailers located in Philadelphia such as Home Depot and
Lowe’s. Additionally, HPP confirmed its percentage of sales in Philadelphia
from 2014-2020 as follows: 2014: 0.005%, 2015: 0.005%, 2016: 0.005%,
2017: 0.015%, 2018: 0.017%, 2019: 0.003%, and 2020: 0.010%. HPP did
not provide the dollar amount of sales for 2018 (the year of the accident) or
2020 (the year Appellee filed the complaint). Instead, HPP disclosed only the
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dollar amount of sales for 2019.6
Although Appellants contend 2019 is the relevant year to analyze,
Appellee initiated the instant lawsuit in late 2020. Thus, 2020 is the more
appropriate year for a “snapshot” of the case.7 See Hausmann, supra. Even
without the specific dollar amount of sales for 2020, the record makes clear
the quantity prong of the venue test was satisfied. As in Hangey, the record
in this case demonstrates that HPP had at least one authorized dealer located
in Philadelphia (specifically, four). At the time the complaint was filed in 2020,
HPP’s percentage of sales in Philadelphia was 0.010% of its total national
sales. The fact that this percentage might be small is not determinative on
its own. See Hangey, supra. See also Dibble, supra. In light of the law
as set forth in this Court’s decision in Hangey,8 we agree with the trial court
that the record in this case similarly demonstrated that HPP’s contacts in
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6 The parties stipulated to a confidentiality order concerning the dollar amount
of HPP’s sales. As we write for the benefit of the parties, and in light of their
stipulation, we will not reveal the dollar amount of sales in this memorandum.
7 In Hangey, this Court analyzed HPP’s sales in 2016, where the action was
initiated in March 2017. Because the complaint in Hangey was filed in early
2017, the 2016 sales were more appropriate to analyze in that case.
8Although our Supreme Court has granted allowance of appeal in Hangey,
unless and until our Supreme Court rules otherwise, this Court’s en banc
decision in Hangey remains binding precedent. See Commonwealth v.
Martin, 205 A.3d 1247 (Pa.Super. 2019) (stating this Court is bound by
existing precedent and continues to follow controlling precedent unless it is
overturned by our Supreme Court).
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Philadelphia satisfy the quantity prong of the venue analysis.9 Accordingly,
we affirm the order overruling Appellants’ preliminary objections to venue.
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 6/24/2022
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9 Any challenge to the quality prong of the venue test is waived where neither
Madle’s Hardware nor HPP’s Rule 1925(b) statement articulated a specific
challenge under the quality prong of the test. See Lineberger v. Wyeth,
894 A.2d 141 (Pa.Super. 2006) (stating general rule that vague Rule 1925(b)
statement can render issues waived on appeal; when court has to guess what
issues appellant is appealing, that is not enough for meaningful review).
Although Appellants mentioned the “quality-quantity” test in their respective
concise statements, Appellants failed to specify a complaint concerning the
quality prong of the test, instead, focusing their claims of error on the
quantity prong of the test.
Moreover, HPP is in the business of distributing consumer outdoor products.
HPP furthers this business objective by having independent authorized dealers
in Philadelphia. HPP derives revenue directly from sales of its products in
Philadelphia. Thus, HPP performs acts in Philadelphia that directly further or
are essential to its business objective, such that the quality prong of the venue
test is satisfied. See Zampana-Barry, supra.- 15 -