Fulano, J. v. Fanjul Corp. ( 2020 )

J-A10040-20
2020 Pa. Super. 166
JUAN FULANO AND JUANA FULANO, : IN THE SUPERIOR COURT OF
et al., : PENNSYLVANIA
Appellants :
:
:
v. :
:
:
FANJUL CORPORATION, ALCOHOLES : No. 3291 EDA 2018
FINOS DOMINICANOS, BIESTERFELD :
INTERNATIONAL GMBH AND :
BIESTERFELD U.S., INC., DREXEL :
CHEMICAL COMPANY, INICIA :
GROUP, UPL LIMITED :
Appeal from the Order Dated October 22, 2018
In the Court of Common Pleas of Philadelphia County Civil Division at
No(s): January Term, 2018, No. 02241
BEFORE: BOWES, J., SHOGAN, J., and PELLEGRINI, J.*
OPINION BY PELLEGRINI, J.: FILED JULY 10, 2020
This is an appeal from the orders of the Court of Common Pleas of
Philadelphia County (trial court) sustaining the preliminary objections filed by
Fanjul Corp. (Fanjul), Drexel Chemical Company (Drexel), Inicia Ltd. (Inicia)
and UPL Limited (UPL) (collectively, “Defendants”).1 Appellants (Plaintiffs) are
Dominican agricultural workers who filed a civil action alleging that they
suffered adverse health effects through exposure to toxic pesticides while
working in the Dominican Republic. The trial court determined that none of
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* Retired Senior Judge assigned to the Superior Court.
1Fanjul and Inicia were, respectively, incorrectly named in the complaint as
Fanjul Corporation and Inicia Group.
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the Defendants, all foreign corporations, were subject to personal jurisdiction
in Pennsylvania. After review, we affirm.
I.
We first briefly summarize Plaintiffs’ civil action. On January 15, 2018,
Plaintiffs filed a thirteen-count complaint in the trial court against six
defendants. Plaintiffs are a group of forty-one Dominican residents claiming
that they were exposed to toxic pesticides and herbicides while working as
fumigators in the sugar cane industry in the Dominican Republic.2 Through
this exposure, Plaintiffs suffered, among other health effects, eye and skin
irritation, headaches, difficulty breathing, chest and stomach pain, nausea and
chronic coughing. Plaintiffs averred that they were injured while working for
subsidiaries of Fanjul (a Florida corporation) and Inicia (a British Virgin Islands
corporation),3 and that the pesticides were produced by Drexel (a Tennessee
corporation) and UPL (an Indian corporation).4 In total, Plaintiffs raised six
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2 Plaintiffs are identified in the complaint by the pseudonym “Juan Fulano.”
The sole female plaintiff “Juana Fulano” was not a fumigator but worked in the
sugar cane fields after they had been fumigated.
3 Of the forty-one Plaintiffs, thirty of them alleged that they worked for a
subsidiary of Fanjul, Central Romana Corporation, Ltd., while seven alleged
that they worked for Grupo Vicini, a predecessor of Inicia.
4 The other two co-defendants, Alcoholes Finos Domincanos and Biesterfeld
International GmbH, are not parties to this this appeal.
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common law causes of action sounding in tort; one count for violation of
International Law; and six causes of action for violations of Dominican Law.
Because Defendants were nonresident corporations, regarding
jurisdiction, Plaintiffs generally averred that:
Th[e] [Trial] Court has personal jurisdiction over Defendants
under the Pennsylvania Long-Arm Statute, 42 Pa.C.S.A. § 5322,
because, inter alia, Defendants transact business throughout the
United States, including in Pennsylvania and in this judicial
district. In addition, as set forth herein, Defendants maintain
sufficient contacts with [Pennsylvania] such that this Court’s
exercise of personal jurisdiction over them does not offend
traditional notions of fair play and substantial justice.
Plaintiffs’ Complaint, 1/15/18, at Paragraph 97.
Plaintiffs asserted a “stream of commerce” theory for personal
jurisdiction over Fanjul and Inicia, alleging that both controlled “sugar
empires” through their various subsidiaries that produce and distribute sugar
throughout the United States, including Pennsylvania. As for the pesticide
producers, Plaintiffs averred that Drexel registers and sells its products in
Pennsylvania while UPL has an in-state alter ego subsidiary, United
Phosphorus, Inc. (UPI), based in Montgomery County.
Defendants all filed preliminary objections under Pa.R.C.P. 1028(a)(1)
for lack of personal jurisdiction and included supporting affidavits that they
had insufficient contacts—if any at all—with Pennsylvania to permit either
general or specific personal jurisdiction. Plaintiffs responded by requesting
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the trial court to allow jurisdictional discovery under Pa.R.C.P. 1028(c)(2).5
After the trial court entered 30-day orders for the parties to conduct discovery,
Plaintiffs served interrogatories, document requests and deposition notices on
Defendants. While Defendants objected to some of the document requests,
each produced a corporate-designee to be deposed about their respective
corporation’s contacts with Pennsylvania.
After holding two hearings for argument, the trial court entered separate
orders dismissing all claims against Drexel, Inicia and UPL.6 The trial court,
however, deferred ruling on Fanjul’s preliminary objections in order to allow
Plaintiffs to conduct additional jurisdictional discovery. After Fanjul produced
their corporate-designee for a second deposition, the trial court entered an
October 22, 2018 order sustaining Fanjul’s preliminary objections and
dismissing all claims against it with prejudice. Because Fanjul was the final
remaining defendant, Plaintiffs filed their notice of appeal and asserted in their
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5 Rule 1028(c)(2) provides: “The court shall determine promptly all
preliminary objections. If an issue of fact is raised, the court shall consider
evidence by depositions or otherwise.” Pa.R.C.P. 1028(c)(2).
6The dates of the orders were July 17, 2018 (Drexel), August 3, 2018 (Inicia)
and August 6, 2018 (UPL).
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court-ordered Rule 1925(b) statement that the trial court erred in finding that
it lacked personal jurisdiction over Defendants.7
II.
Before addressing Plaintiffs’ personal jurisdiction challenges, we must
first address whether this appeal should be quashed, as both Drexel and UPL
have raised several arguments that Plaintiffs violated the Rules of Appellate
Procedure.8
A.
Drexel and UPL first argue that this appeal should be quashed because
Plaintiffs did not file notices of appeal from the separate orders sustaining their
preliminary objections. Rule of Appellate Procedure 341 defines a “final order”
as, among other things, any order that “disposes of all claims and of all
parties.” Pa.R.A.P. 341(b)(1). Because several co-defendants were still in
the case when the trial court dismissed Drexel and UPL, neither order
sustaining their preliminary objections was final and appealable. See K.H. v.
J.R., 826 A.2d 863, 869 (Pa. 2003) (“[I]n an action involving multiple
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7 Plaintiffs also asserted that the trial court should have allowed additional
jurisdictional discovery concerning Fanjul and Inicia. We address these claims
in each defendant’s respective section.
8 Drexel and UPL raised these arguments in a joint motion to quash, and Inicia
raised similar arguments in a motion to dismiss. We denied the motions
without prejudice to them being raised again in their briefs. Inicia now adopts
by reference Drexel’s arguments under Pa.R.A.P. 2137. Fanjul raises no
procedural arguments in their brief.
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defendants, and in the absence of an express determination by the trial court
under [Pa.R.A.P.] 341(c), an order granting summary judgment as to one
party is treated as appealable as of right only after the disposition of the claims
involving the remaining parties.”). Plaintiffs thus correctly waited to file their
appeal until the final remaining defendant Fanjul was dismissed.
Drexel and UPL also argue that Plaintiffs’ notice of appeal incorrectly
listed only the trial court’s October 22, 2018 order dismissing Fanjul rather
than listing all of the trial court’s orders dismissing the other Defendants.
However, “in the circumstance where each of the defendants in a single action
is dismissed prior to trial, an appeal from the order dismissing the remaining
claim or party is sufficient to bring for review the earlier issued orders.” K.H.,
826 A.2d at 871 (citation omitted). “Any concern as to the intended scope of
the appeal may be addressed through the filing of a statement of matters
complained of on appeal pursuant to Appellate Procedural Rule 1925(b).” Id.
Plaintiffs stated in their Rule 1925(b) statement that they were challenging
the orders dismissing Defendants and attached each order that they now seek
to challenge. Any ambiguity as to the scope of the appeal was clarified
through the Rule 1925(b) statement. We therefore find no error.
B.
Drexel and UPL next argue that Plaintiffs waived their challenges by
filing a vague, imprecise Rule 1925(b) statement. Plaintiffs’ statement read,
in relevant part:
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1. The trial court abused its discretion and committed an error of
law in sustaining Drexel's Preliminary Objections to the Complaint
and dismissing Drexel as a defendant for want of personal
jurisdiction.
2. The trial court abused its discretion and committed an error of
law in sustaining Inicia's Preliminary Objections to the Complaint
and dismissing the claims asserted against Inicia with prejudice.
***
4. The trial court abused its discretion and committed an error of
law in sustaining UPL's Preliminary Objections to the Complaint
and dismissing the Complaint as to UPL.
Plaintiffs’ Statement of Errors Complained of on Appeal Pursuant to Pa.R.A.P.
1925(b), 11/29/18, at 2.
“The [Rule 1925(b)] Statement shall concisely identify each error that
the appellant intends to assert with sufficient detail to identify the issue to be
raised for the judge.” Pa.R.A.P. 1925(b)(4)(ii). “[T]he [Rule] 1925(b)
statement must be sufficiently ‘concise’ and ‘coherent’ such that the trial court
judge may be able to identify the issues to be raised on appeal, and the
circumstances must not suggest the existence of bad faith.” Commonwealth
v. Vurimindi, 200 A.3d 1031, 1038 (Pa. Super. 2018). “[A] Rule 1925(b)
statement is a crucial component of the appellate process because it allows
the trial court to identify and focus on those issues the party plans to raise on
appeal.” Id. (citing Riley v. Foley, 783 A.2d 807, 813 (Pa. Super. 2001).
“[W]hen issues are too vague for the trial court to identify and address, that
is the functional equivalent of no concise statement at all.” Commonwealth
v. Smith, 955 A.2d 391, 393 (Pa. Super. 2008) (citing Commonwealth v.
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Dowling, 778 A.2d 683, 686 (Pa. Super. 2001)). “When the trial court has
to guess what issues an appellant is appealing, that is not enough for
meaningful review.” Commonwealth v. Lemon, 804 A.2d 34, 37 (Pa. Super.
2002) (citing Dowling, 778 A.2d at 686).
First, Plaintiffs specifically identified the issue of personal jurisdiction as
to Drexel, and the trial court explained its reasoning for finding that it lacked
jurisdiction over Drexel in its Rule 1925(a) opinion, expressing no confusion
as to Plaintiffs’ challenge. See Trial Court Opinion (T.C.O.), 1/14/19, at 8-10.
In this regard, Drexel does not argue that the trial court’s analysis is either
lacking or insufficient in any manner as a result of Plaintiffs’ Rule 1925(b)
statement. Moreover, Rule of Appellate Procedure 1925(b)(4)(v) provides, in
relevant part, “[e]ach error identified in the Statement will be deemed to
include every subsidiary issue that was raised in the trial court[.]” Pa.R.A.P.
1925(b)(4)(v). Accordingly, we find no waiver as to Drexel. See Smith, 955
A.2d at 393 (no waiver where trial court meaningfully addressed issues
despite vague Rule 1925(b) statement).
In contrast, Plaintiffs did not identify the issue of personal jurisdiction
as to Inicia and UPL in the Rule 1925(b) statement. We note that the trial
court issued one-paragraph orders sustaining Defendants’ preliminary
objections but did not include its reasoning. This Court has explained:
When the reasons for a trial court’s ruling are vague or not
discernable from the record, then an appellant may be forced to
file a vague Rule 1925(b) statement, and it would be unjust to
consider such filing a violation of the Rule. Just as the trial judge
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cannot be made to guess what an appellant is complaining of on
appeal, an appellant cannot be made to guess what the trial judge
is thinking in his or her ruling. Therefore, under these limited
circumstances where the appellant is unable to ascertain the trial
court's rationale for the ruling under appeal, it is not appropriate
to find waiver or to dismiss the appeal based on a vague Rule
1925(b) statement.
Hess v. Fox Rothschild, LLP, 925 A.2d 798, 803-04 (Pa. Super. 2007)
(internal citations and quotation marks omitted).
However, “[i]f the appellant in a civil case cannot readily discern the
basis for the judge's decision, the appellant shall preface the Statement with
an explanation as to why the Statement has identified the errors in only
general terms. In such a case, the generality of the Statement will not be
grounds for finding waiver.” Pa.R.A.P. 1925(b)(4)(vi).
Though Plaintiffs did not preface their Rule 1925(b) statement
explaining why it generally identified the errors, we decline to find that this
omission warrants quashing the appeal. Like Drexel, the trial court
discerned that Plaintiffs were contesting personal jurisdiction over Inicia and
UPL, especially since that was the primary issue litigated through their
preliminary objections. See T.C.O. at 11-16. Further, our research reveals
no case law from this Court that failure to comply with Rule 1925(b)(4)(vi)
results in waiver, nor does Drexel or UPL attempt to make the argument that
we should adopt such a rule based on analogous violations of the Rules of
Appellate Procedure. Accordingly, we find no waiver based on Plaintiffs’ Rule
1925(b) statement.
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C.
Drexel and UPL next allege that Plaintiffs’ counsel failed to serve them
with either the notice of appeal or the Rule 1925(b) statement. Based on our
review of the record, counsel filed both electronically under the belief that
doing so would result in all parties being served. As Defendants point out,
under our Rules of Appellate Procedure, appellants must concurrently serve
their notice of appeal and Rule 1925(b) statement on all parties.9
Nevertheless, despite Plaintiffs’ apparent error, we are again
constrained to find that neither quashing nor remanding this matter is
necessary. First, regarding the failure to serve the notice of appeal on
Defendants, Rule of Appellate Procedure 902 provides as follows:
Failure of an appellant to take any step other than the timely filing
of a notice of appeal does not affect the validity of the appeal, but
it is subject to such action as the appellate court deems
appropriate, which may include, but is not limited to, remand of
the matter to the lower court so that the omitted procedural step
may be taken.
Pa.R.A.P. 902.
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9 Rule of Appellate Procedure 906 specifically requires that the appellant,
concurrent with filing their notice of appeal, shall serve copies on “[a]ll parties
to the matter in the trial court, including parties previously dismissed pursuant
to an interlocutory order[.]” Pa.R.A.P. 906(a)(1). Rule of Appellate Procedure
1925 provides, in relevant part, that service of the Rule 1925(b) statement on
the parties “shall be concurrent with filing and shall be by any means of service
specified under Pa.R.A.P. 121(c).” Pa.R.A.P. 1925(b)(1).
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As noted before, the trial court filed a Rule 1925(a) opinion with its
reasoning for sustaining the preliminary objections, and all Defendants have
fully briefed their respective positions on appeal. As a result, Plaintiffs’ error
has not hindered meaningful appellate review. See Coffman v. Kline, 167
A.3d 772, 776 (Pa. Super. 2017) (“Where a party's procedural missteps do
not affect the validity of the appeal, remand is not required.”). Additionally,
Drexel and UPL do not cite any case law from this Court for the proposition
that failure to serve a Rule 1925(b) statement requires an appeal to be
quashed; nor does either party develop an argument for why we should
establish such a rule through this case based on analogous case law. In the
absence of either, we decline to quash based on Plaintiffs’ service errors.
D.
Finally, Drexel and UPL allege that Plaintiffs violated several Rules of
Appellate Procedure in filing and serving their reproduced record. These
violations include: (1) failure to timely file or serve their reproduced record
concurrently with their brief; (2) failure to file or serve a designation of
contents of reproduced record, as required by Pa.R.A.P. 2154; and (3) filing
incomplete copies with improper pagination.
First, Drexel and UPL are indeed correct that Plaintiffs violated Pa.R.A.P.
2154, which provides, in relevant part:
[T]he appellant shall not later than 30 days before the date fixed
by or pursuant to Rule 2185 (service and filing of briefs) for the
filing of his or her brief, serve and file a designation of the parts
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of the record which he or she intends to reproduce and a brief
statement of issues which he or she intends to present for review.
Pa.R.A.P. 2154(a).
Despite receiving several extensions to file their merits brief and
reproduced record, Plaintiffs never filed a designation of reproduced record in
compliance with Rule 2154.10 Plaintiffs ultimately filed their brief on the final
day to do so (June 7, 2019), but did not concurrently file their reproduced
record in accordance with Pa.R.A.P. 2186.11 Instead, Plaintiffs electronically
filed their reproduced record on June 18, 2019, and neglected to file paper
copies with this Court and serve the Defendants as required by Pa.R.A.P.
2187(a).
Having found that Plaintiffs have violated the Rules of Appellate
Procedure, we must determine if their violations warrant quashing the appeal.
In this regard, Rule of Appellate Procedure 2101 provides:
Briefs and reproduced records shall conform in all material
respects with the requirements of these rules as nearly as the
circumstances of the particular case will admit, otherwise they
may be suppressed, and, if the defects are in the brief or
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10 After Plaintiffs’ deadline for filing a designation of record passed, Defendants
filed counter-designations of contents of the reproduced record on April 11,
2019 (Fanjul), April 15, 2019 (Drexel and UPL) and April 16, 2019 (Inicia).
11 Rule 2186(a)(1) provides: “The reproduced record shall be served and filed
not later than … the date of service of the appellant’s brief[.]” Pa.R.A.P.
2186(a)(1). Appellants are allowed to file the reproduced record beyond that
time if they elect to proceed under Pa.R.A.P. 2154(b), which governs large
records. Plaintiffs, however, never gave notice to the trial court that they
intended to proceed under that subdivision.
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reproduced record of the appellant and are substantial, the appeal
or other matter may be quashed or dismissed.
Pa.R.A.P. 2101 (emphasis added).
Similarly, Rule of Appellate Procedure 2188 states:
If an appellant fails to file his designation of reproduced record,
brief or any required reproduced record within the time prescribed
by these rules, or within the time as extended, an appellee may
move for dismissal of the matter.
Pa.R.A.P. 2188.
“Compliance with the Pennsylvania Rules of Appellate Procedure 2152-
2154 regarding contents of reproduced records on appeal is mandatory, not
directory.” Rosselli v. Rosselli, 750 A.2d 355, 357 (Pa. Super. 2000). This
Court will quash an appeal when the appellant’s violations substantially
impede the appellate process. Id. at 359-60 (appeal quashed due to
appellant’s failure to comply with the Rules of Appellate Procedure regarding
reproduced record). However, “when the defects in the reproduced record
are not so serious as to preclude our ability to properly evaluate and address
the substantive arguments advanced by the parties,” then we have declined
to quash the appeal. Hagel v. United Lawn Mower Sales & Service, Inc.,
653 A.2d 17, 19 (Pa. Super. 1995); Kern v. Kern, 892 A.2d 1, 6 (Pa. Super.
2002) (“[T]his Court quashes appeals for failure to conform to the Rules of
Appellate Procedure only where the failure to conform to the Rules results in
the inability of this Court to discern the issues argued on appeal.”) (citation
omitted).
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Though Plaintiffs failed to comply with the rules for filing its reproduced
record, we decline quashing the appeal. Under Rule of Appellate Procedure
2101, even when the defects in the reproduced record are substantial,
quashing an appeal is not mandatory. Moreover, as we found in preceding
issues, our review of Plaintiffs’ challenges is not substantially hampered by
the failure to produce a reproduced record conforming to the Rules of
Appellate Procedures. We therefore deny Drexel and UPL’s arguments for
quashing the appeal.
III.
Turning to the merits of Plaintiffs’ personal jurisdiction challenges, our
standard of review is as follows:
In determining whether the trial court properly sustained
preliminary objections, the appellate court must examine the
averments in the complaint, together with the documents and
exhibits attached thereto, in order to evaluate the sufficiency of
the facts averred. When sustaining the trial court's ruling will
result in the denial of a claim or a dismissal of suit, preliminary
objections will be sustained only where the case is free and clear
of doubt, and this Court will reverse the trial court's decision
regarding preliminary objections only where there has been an
error of law or an abuse of discretion.
Moreover, when deciding a motion to dismiss for lack of personal
jurisdiction[,] the court must consider the evidence in the light
most favorable to the non-moving party. This Court will reverse
the trial court's decision regarding preliminary objections only
where there has been an error of law or an abuse of discretion.
Once the moving party supports its objections to personal
jurisdiction, the burden of proving personal jurisdiction is upon the
party asserting it.
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Calabro v. Socolofsky, 206 A.3d 501, 505 (Pa. Super. 2019) (quoting
Sulkava v. Glaston Finland Oy, 54 A.3d 884, 889 (Pa. Super. 2012)).
The Due Process Clause of the Fourteenth Amendment to the United
States Constitution limits the authority of a state to exercise in personam
jurisdiction over nonresident defendants. Burger King Corp. v. Rudzewicz,
471 U.S. 462, 471–72 (1985). The extent to which the Due Process Clause
proscribes jurisdiction depends on the nature and quality of the defendant's
contacts with the forum state. Id. at 474–76; Kubik v. Letteri, 614 A.2d
1110, 1114 (Pa. 1992). Where a defendant “has established no meaningful
contacts, ties or relations” with the forum, the Due Process Clause prohibits
the exercise of personal jurisdiction. Burger King, 471 U.S. at 472.
However, where a defendant has “purposefully directed” his activities at the
residents of the forum, he is presumed to have “fair warning” that it may be
called to suit there. Id.
“A defendant's activities in the forum [s]tate may give rise to either
specific or general jurisdiction.” Mendel v. Williams, 53 A.3d 810, 817 (Pa.
Super. 2012). Specific jurisdiction “depends on an affiliation between the
forum and the underlying controversy, principally, [an] activity or an
occurrence that takes place in the forum State and is therefore subject to the
State's regulation.” Vaughn Estate of Vaughn v. Olympus America, Inc.,
208 A.3d 66, 73 (Pa. Super. 2019) (citation omitted). We have summarized
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the three requirements for a forum to exercise specific jurisdiction over a
nonresident defendant as follows:
First, the defendant must have purposefully availed itself of the
privilege of conducting activities within the forum State or have
purposefully directed its conduct into the forum State. Second,
the plaintiff's claim must arise out of or relate to the defendant's
activities in the forum state. Third, jurisdiction must be fair and
reasonable so as not to offend tradition notions of fair play and
substantial justice.
Hammons v. Ethicon, 190 A.3d 1248, 1262 (Pa. Super. 2018) (citing
Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco
County, 137 S. Ct. 1773, 1785 (2017)) (internal quotations and citations
omitted).
As we have explained, “[b]ecause due process may permit specific
jurisdiction based solely on single or occasional acts purposefully directed at
the forum, it is narrow in scope, limiting a cause of action to the extent that
it arises out of or relates to the very activity that establishes jurisdiction.”
Mendel, 53 A.3d at 817 (internal quotations omitted).
General Jurisdiction, on the other hand, is established over a
nonresident corporation when it: “(1) is incorporated under or qualified as a
foreign corporation under the laws of this Commonwealth; (2) consents, to
the extent authorized by the consent; or (3) carries on a continuous and
systematic part of its general business within this Commonwealth.” Seely v.
Caesars Entertainment Corporation, 206 A.3d 1129, 1133 (Pa. Super.
2019) (citing 42 Pa.C.S. § 5301(a)(2)(i-iii)) (footnotes and emphasis
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omitted). In contrast to specific jurisdiction, “[a] court with general
jurisdiction may hear any claim against that defendant, even if all the incidents
underlying the claim occurred in a different State.” Hammons, 190 A.3d at
1261 (quoting Bristol-Myers, 137 S. Ct. at 1780).
Beginning with Goodyear Dunlop Tire Operations, S.A. v. Brown,
564 U.S. 915 (2011), the United States Supreme Court has limited states’
ability to subject corporations to general jurisdiction. A court will have general
personal jurisdiction over a foreign corporation only when its affiliations with
the state are so “continuous and systematic” as to render them essentially at
home in the forum state. Id. at 919. In Daimler AG v. Bauman, 571 U.S.
117 (2014), the Supreme Court clarified that the “paradigm” forums in which
a corporate defendant would be “at home” are that corporation’s place of
incorporation and its principal place of business. Id. at 137. However, as will
be discussed in relation to Drexel, the Daimler Court stated that in an
“exceptional case” a corporate defendant’s operations in a forum outside of
its state of incorporation or principal place of business “may be so substantial
and of such a nature as to render the corporation at home in that [s]tate.”
Id. at 139 n.19.
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IV.
A.
Plaintiffs first challenge that the trial court lacked specific personal
jurisdiction over Fanjul.12 Plaintiffs contend here, as they did in their
complaint, that Fanjul controls a “sugar empire” through its various alter ego
subsidiaries.13 Plaintiffs devote a large part of their brief on the
interconnectedness of Fanjul and these entities, arguing that Fanjul is so
intertwined with them that their corporate forms may be disregarded.
Plaintiffs contend that Fanjul, through these entities, places “its products into
the stream of commerce with sufficient intentionality so as to be subject to
personal jurisdiction in Pennsylvania.” Plaintiffs’ Brief at 38. According to
Plaintiffs, this establishes specific personal jurisdiction under Pennsylvania’s
long-arm statute, 42 Pa.C.S. § 5322(a). Fanjul counters that Plaintiffs have
never alleged any connection between their claims and Pennsylvania to
support specific personal jurisdiction. As a result, Fanjul contends, any alter
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12 The trial court also found that it lacked general personal jurisdiction over
Fanjul because neither Fanjul nor its subsidiaries were incorporated in
Pennsylvania or had their principal place of business here. T.C.O. at 18.
Plaintiffs do not challenge this determination.
13 The alleged alter egos include the previously-mentioned Central Romana
Corporation, Ltd., American Sugar Refining, Inc., ASR Group International,
Inc. and Domino Foods, Inc. None of these entities are incorporated or have
their principal place of business in Pennsylvania.
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ego analysis of its subsidiaries is unnecessary because Plaintiffs’ claims are
not connected to Pennsylvania.
We agree with Fanjul that we need not undertake any alter ego analysis
of Fanjul and its subsidiaries. Plaintiffs are Dominican residents claiming that
they were injured in the Dominican Republic by products that were neither
developed nor made in Pennsylvania. To invoke specific personal jurisdiction,
a plaintiff’s claims must “arise out of or relate to” the defendant’s activities in
the forum state. Hammons, 190 A.3d at 1262. This is reflected in
Pennsylvania’s long-arm statute, which gives courts personal jurisdiction over
defendants or their agents “as to a cause of action or other matter arising”
from specified particular types of contact with Pennsylvania. 42 Pa.C.S.
§ 5322(a) (emphasis added). Plaintiffs have never alleged that their claims
arise from any contacts Fanjul or any of its subsidiaries have with
Pennsylvania. As a result of failing to so allege, Plaintiffs cannot establish
specific personal jurisdiction.
Plaintiffs nevertheless argue that Fanjul is subject to specific personal
jurisdiction because it has placed sugar into the “stream of commerce,”
including in Pennsylvania. However, “[s]tream of commerce cases typically
involve an injury allegedly caused by a product or part manufactured by a
nonresident defendant and placed into the stream of commerce without
knowledge of its eventual destination.” Zeger v. Joseph Rhodes, Ltd., 775
F. Supp. 817, 820 (M.D. Pa. 1991). Because Plaintiffs do not allege that they
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were injured in Pennsylvania by a product produced by Fanjul, their effort to
invoke “stream of commerce” for specific personal jurisdiction is unavailing.
Recognizing this deficiency, Plaintiffs urge this Court to expand the
“stream of commerce” theory for specific personal jurisdiction. Plaintiffs’
Reply Brief at 2-3. We decline to do so. Plaintiffs’ proposed expansion would
effectively subject defendants to specific personal jurisdiction in any forum in
which it distributes a product, regardless of there being any connection
between the defendant’s forum contacts and the plaintiff’s claims.
Accordingly, the trial court correctly found that it lacked specific personal
jurisdiction over Fanjul.14
B.
Plaintiffs next challenge the trial court’s determination that it lacked
personal jurisdiction over Inicia. As they did with Fanjul, Plaintiffs allege that
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14 Plaintiffs also claim that the trial court should have compelled Fanjul to
produce certain documents and witnesses after it deferred ruling on Fanjul’s
preliminary objections. However, there was no need for further discovery
because the issue raised by the preliminary objections was whether the
allegations in the complaint were legally sufficient to support specific personal
jurisdiction. Plaintiffs do not allege that their claims arise out of any forum
contacts with Pennsylvania by Fanjul or any of its alleged alter egos. The trial
court therefore did not err in ruling on Fanjul’s preliminary objections after
already providing Plaintiffs with two rounds of jurisdictional discovery. See
Nutrition Management Services, Co. v. Hinchcliff, 926 A.2d 531, 536 (Pa.
Super. 2007) (finding jurisdictional discovery was unnecessary when the issue
raised by preliminary objections was whether allegations in plaintiff’s
complaint were legally sufficient to sustain specific personal jurisdiction).
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Inicia controls a “sugar empire” through various alter ego subsidiaries,
specifically, Ingenio Cristóbal Colón (Cristóbal Colón) and Compañía Anónima
de Explotaciones Industriales (CAEI). Plaintiffs focus almost exclusively on
the interconnectedness of these entities, and then argue that the actions of
Cristóbal Colón and CAEI can be imputed to Inicia. Plaintiffs’ Brief at 15-22,
41-43. In contrast to Fanjul, however, Plaintiffs contend that the trial court
had both general and specific personal jurisdiction over Inicia. Id. at 43-45.15
First, Plaintiffs fail to explain how Pennsylvania would have general
personal jurisdiction over Inicia, which is incorporated in the British Virgin
Islands and based in Santa Domingo, Dominican Republic.16 Plaintiffs argue
that Inicia’s lack of physical presence in Pennsylvania is not determinative of
general personal jurisdiction, but then fail to point to any evidence that Inicia
through its alleged alter egos carries on “a continuous and systematic part of
its general business within this Commonwealth.” 42 Pa.C.S § 5301(a)(2)(iii).
____________________________________________
15 As noted before, Plaintiffs also raise a discovery claim concerning Inicia,
arguing that the trial court erred in denying additional jurisdictional discovery
against Inicia. However, Plaintiffs waited until their reply brief to provide
argument in support of this claim. Rule of Appellate Procedure 2113 states
that an “appellant may file a brief in reply to matters raised by appellee's brief
not previously raised in appellant's brief.” Pa.R.A.P. 2113(a). An appellant is
prohibited from using their reply brief as a vehicle to argue issues raised but
inadequately developed in their original brief. Commonwealth v. Fahy, 737
A.2d 214, 219 n.8 (Pa. 1999) (citations omitted). The issue is thus waived.
16 None of Inicia’s alleged alter egos are incorporated or have their principal
place of business in Pennsylvania. At oral argument, Inicia stated that they
were not sugar growers but a management company.
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The trial court thus correctly concluded that it lacked general personal
jurisdiction over Inicia.
Plaintiffs likewise provide little argument about specific personal
jurisdiction, arguing merely that “the facts supported application of the stream
of commerce theory to establish personal jurisdiction over Inicia.” Plaintiffs’
Brief at 45. As we explained in relation Fanjul, this is a misapplication of the
“stream of commerce” theory of specific personal jurisdiction. Plaintiffs are
Dominican residents who allege that they were injured in the Dominican
Republic; they do not allege that Inicia produced a product that was placed
into the stream of commerce that ultimately injured them in Pennsylvania.
Accordingly, Plaintiffs’ claim as to Inicia fails.17
C.
Plaintiffs next argue that the trial court had personal jurisdiction over
Drexel on two separate bases: (1) Drexel has substantial contacts with
Pennsylvania to permit general personal jurisdiction; and (2) Drexel
____________________________________________
17 Inicia asks this Court to sanction Plaintiffs under Pa.R.A.P. 2744, urging this
Court to deem Plaintiffs’ appeal to be frivolous. “In determining the propriety
of [sanctions], we are ever guided by the principle that an appeal is not
frivolous simply because it lacks merit[; r]ather, it must be found that the
appeal has no basis in law or fact.” U.S. Claims v. Dougherty, 914 A.2d
874, 878 (Pa. Super. 2006). Though we have determined that Plaintiffs’ issues
as to Inicia lack merit, we decline to impose sanctions on Plaintiffs for filing
this appeal, especially since Inicia is the only party requesting that we do so.
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consented to jurisdiction by registering its products under Pennsylvania’s
Pesticide Control Act of 1973 (Pesticide Control Act), 3 P.S. §§ 111.21-112.
1.
Plaintiffs first claim that the trial court had general personal jurisdiction
over Drexel. As we explained above, after the United States Supreme Court’s
decision in Daimler, general personal jurisdiction “will not lie” in a state in
which a corporation is neither incorporated nor has its principal place of
business. Hammons, 190 A.3d at 1261. Recognizing this, Plaintiffs argue
that Drexel qualifies as an “exceptional case” under Daimler where general
personal jurisdiction may be allowed over a corporation when its activities in
a state are “so substantial and of such a nature as to render the corporation
at home in that [s]tate.” Daimler, 571 U.S. at 139 n.19.
Drexel is a chemical manufacturer of agricultural products that is
incorporated in Tennessee and based in Memphis, Tennessee. Drexel
produced six products that Plaintiffs alleged caused their injuries: Pas 80;
MSMA 72 SL; Drexel Terbutrina 50 SC; Diuron 80 SP; Drexel Ametrina 50 SC;
and 2-4 DB. Drexel’s products are developed in Memphis and manufactured
in Tennessee, Mississippi and Georgia. Drexel then sells its products to
distributors who, in turn, the sell them to customers. Out of Drexel’s over
100 customer distributors, less than 20 are licensed to do business in
Pennsylvania, and only one is actually located in state.
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For products shipped directly to Pennsylvania, Drexel’s reported sales
revenue totaled 2.26% in 2016 and 2.89% in 2017 out of its total sales
revenue. These totals do not include shipments outside of Pennsylvania that
are later shipped into the state. Drexel’s corporate-designee, however,
estimated that if those totals were included in its Pennsylvania sales revenue
it would be no higher than 5% of its total sales revenue.
Additionally, Drexel has no plants or offices in Pennsylvania; its in-state
physical presence is limited to a leased warehouse in Bucks County. Nor does
Drexel have any employees or officers in state. Its closest employee is its
Northeast sales representative, who is based in New Jersey. Drexel also does
not directly advertise or market its products in Pennsylvania.
Based on our review, this is not an “exceptional case” in which Drexel
can be constitutionally subjected to general personal jurisdiction in
Pennsylvania. In BNSF Railway Co. v. Tyrell, 137 S. Ct. 1549 (2017), the
United States Supreme Court addressed what constitutes an “exceptional
case” under Daimler to allow general jurisdiction over a nonresident
corporation outside of its place of incorporation and principal place of business.
There, North and South Dakota filed a civil action Montana state court against
BNSF, a Delaware-incorporated railway company with its principal place of
business in Texas. BNSF maintained over 2,000 miles of railroad track in
Montana (about 6% of its total track mileage); employed about 2,100 workers
there (less than 5% of its total work force); had only one of its 24 automotive
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facilities within the state; and generated less than 10% of its total revenues
in the state. Id. at 1554. Finding these contacts insufficient to establish
general personal jurisdiction, the BNSF Court explained:
BNSF … is not incorporated in Montana and does not maintain its
principal place of business there. Nor is BNSF so heavily engaged
in activity in Montana as to render it essentially at home in that
State. As earlier noted, BNSF has over 2,000 miles of railroad
track and more than 2,000 employees in Montana. But, as we
observed in Daimler, the general jurisdiction inquiry does not
focus solely on the magnitude of the defendant's in-state contacts.
Rather, the inquiry calls for an appraisal of a corporation's
activities in their entirety; a corporation that operates in many
places can scarcely be deemed at home in all of them.
Id. at 1559 (internal quotation marks, alterations, and citations omitted).
As the trial court observed, Drexel’s contacts with Pennsylvania pale in
comparison with those that the BNSF Court found to be insufficient to qualify
as a Daimler “exceptional case” allowing general jurisdiction over a
nonresident corporation. See T.C.O. at 9-10. With no offices in Pennsylvania,
Drexel’s physical presence in state is limited to leasing a single warehouse to
store its products for distribution in the Northeast. Likewise, Drexel has no
employees or officers in Pennsylvania; its nearest employee is a sales
representative in New Jersey. Moreover, Drexel has only one distributor
customer in Pennsylvania that accounts for less than 3% of its total gross
revenue. Even if its shipments outside of Pennsylvania that are then shipped
into the state were included, Drexel’s revenues for Pennsylvania would still
total less than 5% of their total revenues. Finally, Drexel has no direct
marketing or advertising in Pennsylvania.
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Despite these facts, Plaintiffs ask us to reject the trial court’s reliance
on BNSF but provide no argument explaining why Drexel’s contacts with
Pennsylvania are greater than those that the BNSF Court found to be
insufficient. Moreover, Plaintiffs fail to point us to any Pennsylvania court has
ever applied the purported Daimler “exceptional case” exception. Nor do
Plaintiffs cite any federal or state court, post-Daimler, holding that a
corporate defendant’s contacts with a forum were so substantial as to permit
general personal jurisdiction outside of its place of incorporation or principal
place of business. Accordingly, the trial court correctly found that Drexel’s
contacts with Pennsylvania were insufficient to constitutionally allow general
personal jurisdiction.
2.
Plaintiffs next claim that Drexel has consented to general jurisdiction in
Pennsylvania by registering its pesticides under the Pesticide Control Act.
Though Drexel has neither registered as a foreign corporation doing business
in Pennsylvania nor consented to jurisdiction here, Plaintiffs contend that
Drexel’s registration of its pesticides is tantamount to registering as a foreign
corporation in Pennsylvania and thus subjecting itself to personal jurisdiction
under 42 Pa.C.S. § 5301(a)(2).18
____________________________________________
18 Section 5301 of the Judicial Code provides, in relevant part:
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In support, Plaintiffs rely on the declaration of purpose of the Pesticide
Control Act, which is to “to regulate in the public interest, the labeling,
distribution, storage, transportation, use, application, and disposal of
pesticides.” 3 P.S. § 111.23. The Pesticide Control Act requires that “[e]very
pesticide which is distributed in this State shall be registered[.]” 3 P.S.
§ 111.25a(a). “Distribute” is defined in the Act as “offer for sale, hold for sale,
sell, barter, or supply pesticides in this State.” 3 P.S. § 111.24. Based on
this, Plaintiffs believe that Drexel understood that it was subjecting itself to
general personal jurisdiction in Pennsylvania. We disagree.
____________________________________________
(a) General rule.--The existence of any of the following
relationships between a person and this Commonwealth shall
constitute a sufficient basis of jurisdiction to enable the tribunals
of this Commonwealth to exercise general personal jurisdiction
over such person, or his personal representative in the case of an
individual, and to enable such tribunals to render personal orders
against such person or representative:
* * *
(2) Corporations.--
(i) Incorporation under or qualification as a foreign
corporation under the laws of this Commonwealth.
(ii) Consent, to the extent authorized by the consent.
(iii) The carrying on of a continuous and systematic
part of its general business within this
Commonwealth.
42 Pa.C.S. § 5301(a)(2)(i)-(iii).
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Besides citing no case law in support of its claim, Plaintiffs are asking us
to ignore that the Pesticide Control Act contains no provisions notifying
registrants that they will be subjected to general personal jurisdiction in
Pennsylvania under 42 Pa.C.S. § 5301. This stands in contrast to foreign
corporations and limited liability companies being required under the
Pennsylvania Associations Code, 15 Pa.C.S. §§ 101-419, to register with the
Department of State before conducting business in Pennsylvania. 15 Pa.C.S.
§ 411(a). By registering to do business here, those entities are put on notice
that our courts will be permitted to exercise general personal jurisdiction over
any cause of action that is asserted against them. 42 Pa.C.S. § 5301(a)(2)(i).
Significantly, this Court has held that, even after Daimler, consent by
registration remains a viable method of obtaining personal jurisdiction
because the party has waived challenging personal jurisdiction “by registering
to do business under a [statutory framework] which specifically advises the
registrant of its consent by registration.” Webb-Benjamin, LLC v.
International Rug Group, LLC, 192 A.3d 1133, 1139 (Pa. Super. 2018)
(quoting Bors v. Johnson & Johnson, 208 F. Supp. 3d 648, 655 (E.D. Pa.
2016)) (emphasis in original). Indeed, one of the purposes of requiring
registration of foreign corporations is to facilitate the subjection of those
corporations to Pennsylvania courts and ensuring that citizens have access to
information in their dealings with them. 15 Pa.C.S. § 412, Comments;
Hoffman Const. Co. v. Erwin, 200 A. 579, 580 (Pa. 1938) (purpose of
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registration “is to bring foreign corporations doing business in this State within
the reach of legal process”).
Additionally, as Drexel observes, the Pesticide Control Act requires
manufacturers to not only register its pesticides that it offers to sell or actually
sells in Pennsylvania, but also to register any pesticides that it holds for sale,
supplies, transports, or delivers for transport in state. 3 P.S. § 111.24
(“Distribute” means to offer for sale, hold for sale, sell, barter, or supply
pesticides in this State.”); 3 P.S. § 111.28(a)(1) (“No person shall distribute,
transport, or deliver for transportation, into, through or within this
Commonwealth … [a]ny pesticide which has not been registered pursuant to
the provisions of this act.”). As a result, certain activities require
manufacturers to register their pesticides with Pennsylvania but do not also
obligate them to register as a foreign corporation. We, therefore, cannot
conclude that registrants under the Pesticide Control Act voluntarily consent
to general personal jurisdiction simply by registering their pesticides with
Pennsylvania.
D.
In their final challenge, Plaintiffs argue that the trial court erred in
concluding that it lacked general personal jurisdiction over UPL, which is an
Indian corporation based in Mumbai, India. Plaintiffs alleged that UPL are the
manufacturers of Asulox SL 40, one of the pesticides that they were exposed
to during their work. Because UPL is neither incorporated nor has its principal
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place of business in Pennsylvania, Plaintiffs seek to impute Pennsylvania’s
general personal jurisdiction over UPL’s subsidiary UPI, which is based in
Pennsylvania. Plaintiffs maintain that UPI is controlled by UPL and that it is
permissible for UPL to be subjected to general personal jurisdiction in
Pennsylvania under an alter ego theory of jurisdiction.
While there are few cases addressing it, there is Pennsylvania precedent
for an alter ego theory of personal jurisdiction over a foreign corporation. 19
____________________________________________
19 Citing Daimler, the trial court held that UPI’s general personal jurisdiction
could not be imputed to UPL even if it determined that UPI was a wholly-
owned subsidiary of UPL. T.C.O. at 11. The Daimler Court held that a
German car manufacturer could not be subjected to general personal
jurisdiction in California, even with its New Jersey-based subsidiary’s contacts
imputed to it and those contacts being deemed sufficient to render the
subsidiary “at home” California. Daimler, 571 U.S. at 136-39. Justifiably,
some federal courts have questioned whether general personal jurisdiction
over a foreign parent corporation may be imputed through its subsidiary. See,
e.g., Sabol v. Bayer Healthcare Pharm., Inc., ___ F.Supp.3d ___, 2020
WL 705170, at *8 (S.D.N.Y. Feb. 12, 2020) (observing that, post-Daimler,
“it is not entirely clear that courts may impute general jurisdiction from a
domestic entity to a foreign entity”).
However, the Daimler Court was reviewing the Ninth Circuit’s agency theory
of jurisdiction, noting that it represented “a less rigorous test” than the more
stringent alter ego approaches developed by other Circuit Courts of Appeals.
Daimler, 571 U.S. at 134-35 (observing that “several Courts of Appeals have
held ... that a subsidiary's jurisdictional contacts can be imputed to its parent
only when the former is so dominated by the latter as to be its alter ego”).
Because the Daimler Court did not explicitly disavow application of the alter
ego approach to general personal jurisdiction, we will address the merits of
Plaintiff’s alter ego argument in regards to UPL. See Seeley, 206 A.3d at
1134-35 (this Court finding that foreign parent was not subject to general
personal jurisdiction in Pennsylvania based on its subsidiary being located in
Delaware County).
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Generally, a corporate parent will retain its distinct identity and not be subject
to the jurisdictions of its subsidiaries, even when it shares common directors,
officers and shareholders. Botwinick v. Credit Exch., Inc., 213 A.2d 349,
354 (Pa. 1965). In Botwinick, however, our Supreme Court explained:
There is a well recognized exception to these general rules if the
record demonstrates that the subsidiary is the ‘alter ego’ of the
parent to the extent that domination and control by the parent
corporation renders the subsidiary a mere instrumentality of the
parent; under such extreme circumstances the parent corporation
may be held to be doing business within the state under the facade
of the subsidiary[.]
Id. (internal citations omitted); Barber v. Pittsburgh Corning Corp., 464
A.2d 323, (Pa. Super. 1983) (personal jurisdiction established where
defendants purposely availed themselves of benefits and protections of
Pennsylvania law and substantially conducted recurring business affairs
through operations of its industrial subsidiaries).
While this inquiry has rarely been addressed since Botwinick, our sister
federal courts have frequently addressed alter ego jurisdiction and developed
the pertinent inquiry. Under the alter-ego theory of personal jurisdiction, “if
a subsidiary is ‘merely the agent’ of its parent corporation or the parent
corporation ‘controls’ the subsidiary, ‘then personal jurisdiction exists over the
parent whenever personal jurisdiction (whether general or specific) exists over
the subsidiary.’ ” Lutz v. Rakuten, Inc., 376 F. Supp. 3d 455, 470–71 (E.D.
Pa. 2019) (quoting Shuker v. Smith & Nephew, PLC, 885 F.3d 760, 781
(3d Cir. 2018)).
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The theory applies only if “the degree of control exercised by the parent
is greater than normally associated with common ownership and directorship”
and “the parent controls the day-to-day operations of the subsidiary such that
the subsidiary can be said to be a mere department of the parent.” Action
Mfg. Co. v. Simon Wrecking Co., 375 F. Supp. 2d 411, 422 (E.D. Pa. 2005)
(citation omitted).
In determining whether a subsidiary is the alter ego of its parent
corporation, courts consider the following factors:
(1) ownership of all or most of the stock of the related corporation;
(2) common officers and directors; (3) common marketing image;
(4) common use of a trademark or logo; (5) common use of
employees; (6) integrated sales system; (7) interchange of
managerial and supervisory personnel; (8) performance by the
related corporation of business functions which the principal
corporation would normally conduct through its own agent or
departments; (9) acting of the related corporation as marketing
arm of the principal corporation, or as an exclusive distributor;
and (10) receipt by the officers of the related corporation of
instruction from the principal corporation.
Lutz, 376 F. Supp. 3d at 47 (quotations and citations omitted).
“These factors are best viewed as a non-exclusive guide to help resolve
the broader issue of whether the companies have a single functional and
organic identity.” Simeone ex rel. Estate of Albert Francis Simeone, Jr.
v. Bombardier-Rotax GmbH, 360 F. Supp. 2d 665, 676 (E.D. Pa. 2005)
(internal quotation omitted). Thus, “no one aspect of the relationship between
two corporations unilaterally disposes of the analysis, and the court may
consider any evidence bearing on the corporations' functional
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interrelationship.” In re Chocolate Confectionary Antitrust Litigation,
674 F. Supp. 2d 580, 598 (M.D. Pa. 2009).
Plaintiffs’ argument, which is less than a page-and-a-half and contains
no citations to either the record or case law, highlights a few facts developed
through discovery that they assert weigh in favor of finding that UPI is the
alter ego of UPI. First among these, Plaintiffs emphasize that UPL is expected
to follow UPL’s policies and that their compliance is monitored, with these
policies including marketing coordination, human resources, contracting
requirements, and coordination of operating expenses.
However, monitoring and gathering information about a subsidiary’s
performance is typical in a parent-subsidiary relationship and does not involve
the kind of day-to-day control needed to establish an alter ego relationship.
See In re Chocolate Confectionary Antitrust Litigation, 641 F. Supp. 2d.
367, 386 (M.D. Pa. 2009) (approval of budgets and gathering information
about corporate performance typify standard parent-subsidiary interactions).
Further, compliance with corporate-wide accounting, finance, or sales
protocols are likewise typical of the parent-subsidiary relationship. Id.
(“Uniformity in finance procedure is a practical necessity for global
conglomerates to monitor corporate growth and maximize efficiency, and
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imposition of mandatory financial reporting does not divest subsidiaries of
control over daily operating activities.”) (citation omitted).20
Plaintiffs next highlight that UPI is free to use UPL’s trademark symbol
without any compensation. While this may be indicative of an alter ego
relationship, it would not rise to the level of necessary control to establish it.
See In re Enterprise Rent-A-Car Wage & Hour Employment Practices
Litigation, 735 F. Supp. 2d 277, 323 (W.D. Pa. 2010) (finding common
marketing image and joint use of trademarked logos does not alone justify
finding alter ego relationship).
Plaintiffs also assert that UPI is the exclusive sales agent of UPL
agricultural products in the United States. UPL sells its products to its
subsidiaries outside of India, who then, in turn, sells them to UPI.21 Plaintiffs’
argument, however, is undercut by the fact that UPI is free to purchase and
sell products made by other manufacturers. Thus, whatever weight that can
be attached to UPL selling its products in the US through UPI in the United
____________________________________________
20 In fact, UPL’s general counsel, Rohit Kumar, explained in his deposition that
only UPI reported to UPL through one employee, namely, UPI’s president or
vice president of business, who would report UPL’s global sales director.
Deposition of Rohit Kumar, 7/24/18, at 30. Kumar classified this reporting as
being a performance review in the nature of a supervisory capacity. Id.
Significantly, Kumar stated that UPL does not have involvement in the day-
to-day operations of UPI. Id. at 39.
21UPL does direct sales to the United States, but it is a relatively miniscule
portion of their global sales, accounting for 0.09% in 2017 and 0.16% in 2018.
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States is diminished by the fact that UPI does not exclusively sell UPL
products. Plaintiffs acknowledge this in their brief but fail to explain why this
does not undermine their exclusive agent argument.
Moreover, as UPL points out in their brief, there were a number of factors
that weigh in favor of UPI not being an alter ego of UPL, namely, (1) UPL owns
none of UPI’s stock; (2) no common officers or directors between the two
entities; (3) no common use of employees; and (4) no interchange of
managerial or supervisory personnel. All of this is in addition to neither entity
sharing bank accounts; maintaining separate financial and accounting
records; having separate employees; and UPI being adequately and
independently financed. Significantly, Plaintiffs do not contest any of these
facts, all of which strongly weigh in favor of finding that UPL and UPI exercise
a typical parent-subsidiary relationship rather than UPI being the mere
instrumentality of UPL.22
Accordingly, we find that the trial court did not err in finding that
Plaintiffs could not impute UPI’s general personal jurisdiction in Pennsylvania
to UPL through an alter ego theory of jurisdiction.
____________________________________________
22 Though Plaintiffs’ alter ego theory is lacking under the facts of this case,
alter ego theory remains a viable avenue for asserting personal jurisdiction
when there is evidence that a Pennsylvania subsidiary is the mere
instrumentality of its parent corporation. See Williams by Williams v. OAO
Severstal, No. 938 WD 2017 (Pa. Super. filed October 3, 2019) (unpublished
memorandum) (finding specific personal jurisdiction based on defendant
parent corporation using its subsidiary as its mere Pennsylvania
instrumentality).
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Orders affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 7/10/20
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