Baanyan Software Services, Inc. v. Hima Bindhu Kuncha , 433 N.J. Super. 466 ( 2013 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-2058-12T3
BAANYAN SOFTWARE SERVICES, INC.,
Plaintiff-Appellant,
APPROVED FOR PUBLICATION
v. December 19, 2013
HIMA BINDHU KUNCHA, APPELLATE DIVISION
Defendant-Respondent.
Submitted December 10, 2013 – Decided December 19, 2013
Before Judges Reisner, Alvarez and Carroll.
On appeal from Superior Court of New Jersey,
Law Division, Middlesex County, Docket No.
L-2529-12.
Archer & Greiner, attorneys for appellant
(Patrick Papalia, of counsel; Leo J. Hurley,
Jr., on the brief).
Hima Bindhu Kuncha, respondent pro se.
The opinion of the court was delivered by
CARROLL, J.S.C. [temporarily assigned].
Plaintiff Baanyan Software Services, Inc. (Baanyan),
appeals from a December 7, 2012 Law Division order dismissing
its complaint for lack of personal jurisdiction over defendant
Hima Bindhu Kuncha.1 Since we conclude that defendant lacked
minimum contacts with New Jersey, and that to subject defendant
to jurisdiction in New Jersey would offend traditional notions
of fair play and substantial justice, we affirm.
I.
We discern the following facts from the limited record
before the Law Division on the motion to dismiss. Because no
jurisdictional discovery was ordered, nor apparently requested,
we rely upon the complaint and the certifications that were
filed supporting and opposing defendant's dismissal motion.
Baanyan is an information technology development and
software consulting company with its headquarters in Edison, New
Jersey. According to Baanyan's website, it is part of a
multinational corporate organization that, "[r]eaching out from
its locations in [the] USA and India, is able to locate and
attract the very best computing talent from all over the globe."
Baanyan employed defendant as a computer systems analyst,
pursuant to a written consulting agreement. Defendant was
living in California in January 2011 when the agreement was
1
In her brief, defendant challenges an $825 counsel fee award
imposed against her as a sanction. We decline to disturb the
November 5, 2012 order imposing that sanction, as defendant has
not cross-appealed from that order. "It is clear that only the
. . . orders . . . designated in the notice of appeal . . . are
subject to the appeal process and review." Pressler & Verniero,
Current N.J. Court Rules, Comment 6.1 on R. 2:5-1 (2014).
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signed. Defendant negotiated certain terms of the contract
through various e-mails and telephone calls with representatives
of Baanyan. Defendant sent an executed copy of the consulting
agreement to Baanyan, which executed it at its New Jersey
headquarters. The agreement itself is silent as to Baanyan's
address. It also contains no forum selection clause.
The terms of employment required defendant to relocate from
California to Illinois to provide the consulting services.
Defendant moved to Illinois in February 2011, and began
providing services as needed for two of Baanyan's clients, both
located in Illinois. From May 2011 through August 2011,
defendant was out of the country, and provided no services for
Baanyan. After defendant returned to Illinois, during September
2011 she resumed working for Baanyan on a project for one of its
corporate clients, Halcyon, Inc., a company based in Ohio.
Baanyan paid defendant for her services in Illinois via direct
deposit into her Illinois bank account. The five payments she
received were memorialized by receipts bearing Baanyan's New
Jersey address. At no time during her brief employment with
Baanyan did defendant ever work in New Jersey, nor did she ever
provide services for any client of Baanyan that was located in
New Jersey.
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In October 2011, defendant ceased working for Baanyan and
began working for Halcyon. She continued to work for Halcyon
until December 23, 2011. According to defendant's unrefuted
certification, both she and Halcyon "settled the dispute with
Baanyan about my having gone to work for Halcyon. In fact,
Baanyan was paid monies on that dispute, not only by Halcyon,
but by me." In January 2012, defendant moved to Tennessee, and
obtained employment with another software company headquartered
in California. Defendant continues to live and work in
Tennessee.
On April 10, 2012, Baanyan filed suit against defendant in
the Law Division, Middlesex County, alleging breach of contract,
tortious interference with Baanyan's business relationships,
breach of fiduciary obligations, unjust enrichment, and fraud.
Defendant initially did not respond to Baanyan's complaint,
which resulted in the entry of default against her on August 8,
2012. Thereafter, defendant moved to dismiss plaintiff's
complaint for lack of personal jurisdiction. Alternatively,
defendant sought to vacate the prior default.
On December 7, 2012, Judge Jane B. Cantor granted
defendant's motion to dismiss. In a written decision that
accompanied her order, the judge, citing a recent unpublished
decision of this court presenting a similar factual scenario,
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concluded that the circumstances here were insufficient to
establish personal jurisdiction over defendant. Specifically,
Judge Cantor reasoned:
[D]efendant in this case has not done
business or resided in New Jersey. At all
pertinent times the defendant worked in
Illinois for two of plaintiff's corporate
clients, both in Illinois. All contacts
concerning the hiring took place while the
defendant was in California. Any breach of
the contract that might have taken place
took place while defendant was in Illinois.
As a result, Judge Cantor dismissed plaintiff's complaint due to
lack of personal jurisdiction.
II.
On appeal, Baanyan argues that defendant's contacts with
New Jersey, which consist of entering into a consulting
agreement with a New Jersey corporation, providing services for
and accepting payment from the New Jersey corporation, with
receipts bearing the corporation's New Jersey address, and
providing timesheets to the corporation, are together sufficient
to establish personal jurisdiction over defendant in New Jersey.
Baanyan further argues that New Jersey's exercise of
jurisdiction over defendant would not offend traditional notions
of fair play and justice, because defendant entered into an
agreement that she knew would have substantial effects in New
Jersey. Finally, Baanyan submits that the fact that defendant
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was not physically present in New Jersey is not dispositive of
whether New Jersey can exercise jurisdiction over her. For the
reasons that follow, we find these arguments unpersuasive.
New Jersey courts may exercise personal jurisdiction over a
non-resident defendant "consistent with due process of law." R.
4:4-4(e). New Jersey's long arm jurisdiction extends "to the
uttermost limits permitted by the United States Constitution."
Avdel Corp. v. Mecure, 58 N.J. 264, 268 (1971).
Following the landmark decision by the United States
Supreme Court in International Shoe Co. v. Washington, 326 U.S.
310, 66 S. Ct. 154, 90 L. Ed. 95 (1945), a two-part test has
consistently been applied in determining the extent to which
courts can assert personal jurisdiction over out-of-state
residents. First, "due process requires only that in order to
subject a defendant to a judgment in personam, if he be not
present within the territory of the forum, he have certain
minimum contacts with it[.]" Id. at 316, 66 S. Ct. at 158, 90
L. Ed. at 102. Second, the minimum contacts must be of a nature
and extent "such that the maintenance of the suit does not
offend 'traditional notions of fair play and substantial
justice.'" Ibid. (quoting Milliken v. Meyer, 311 U.S. 457, 463,
61 S. Ct. 339, 343, 85 L. Ed. 278, 283 (1940)); see also Hanson
v. Denckla, 357 U.S. 235, 78 S. Ct. 1228, 2 L. Ed. 2d 1283
6 A-2058-12T3
(1958); McGee v. Int'l Life Ins. Co., 355 U.S. 220, 78 S. Ct.
199, 2 L. Ed. 2d 223 (1957). "[T]he requisite quality and
quantum of contacts is dependent on whether general or specific
jurisdiction is asserted[.]" Citibank, N.A. v. Estate of
Simpson, 290 N.J. Super. 519, 526 (App. Div. 1996).
"If a cause of action is unrelated to the defendant's
contacts with the forum state, the court's jurisdiction is
general." Mische v. Bracey's Supermarket, 420 N.J. Super. 487,
491 (App. Div. 2011); see also Charles Gendler & Co. v. Telecom
Equip. Corp., 102 N.J. 460, 472 (1986). For general
jurisdiction to obtain, the defendant must have contacts with
this State that are "'so continuous and substantial as to
justify subjecting the defendant to jurisdiction.'" Waste
Mgmt., Inc. v. The Admiral Ins. Co., 138 N.J. 106, 123 (1994),
cert. denied sub nom., WMX Techs. v. Canadian Gen. Ins. Co., 513
U.S. 1183, 115 S. Ct. 1175, 130 L. Ed. 2d 1128 (1995) (quoting
Gendler, supra, 102 N.J. at 472); see also Jacobs v. Walt
Disney World, Co., 309 N.J. Super. 443, 452 (App. Div. 1998).
"This standard for establishing general jurisdiction is
difficult to meet, requiring extensive contacts between a
defendant and a forum." Mische, supra, 420 N.J. Super. at 492.
Specific jurisdiction is available when the "cause of
action arises directly out of a defendant's contacts with the
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forum state." Waste Mgmt., supra, 138 N.J. at 119. In this
context, a "'minimum contacts inquiry must focus on the
relationship among the defendant, the forum, and the
litigation.'" Lebel v. Everglades Marina, Inc., 115 N.J. 317,
323 (1989). The minimum contacts requirement is satisfied "so
long as the contacts expressly resulted from the defendant's
purposeful conduct and not the unilateral activities of the
plaintiff." Ibid. (citing World-Wide Volkswagen Corp. v.
Woodson, 444 U.S. 286, 297-98, 100 S. Ct. 559, 567-68, 62 L. Ed.
2d 490, 501-02 (1980)). "In determining whether the defendant's
contacts are purposeful, a court must examine the defendant's
'conduct and connection' with the forum state and determine
whether the defendant should 'reasonably anticipate being haled
into court [in the forum state].'" Bayway Ref. Co. v. State
Utils., Inc., 333 N.J. Super. 420, 429 (App. Div.), certif.
denied, 165 N.J. 605 (2000) (quoting World-Wide Volkswagen
Corp., supra, 444 U.S. at 297, 100 S. Ct. at 567, 62 L. Ed. 2d
at 501).
Stated otherwise, when the defendant is not present in the
forum state, "'it is essential that there be some act by which
the defendant purposefully avails [herself] of the privilege of
conducting activities within the forum state, thus invoking the
benefit and protection of its laws.'" Waste Mgmt., supra, 138
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N.J. at 120 (quoting Hanson, supra, 357 U.S. at 253, 78 S. Ct.
at 1240, 2 L. Ed. 2d at 1298). This "purposeful availment"
requirement ensures that an out-of-state defendant will not be
haled into court based on "random, fortuitous, or attenuated
contacts or as a result of the unilateral activity of some other
party." Id. at 121; see also Blakey v. Cont'l Airlines, 164
N.J. 38, 67 (2000).
There is no requirement that the defendant ever be
physically present in the forum state. See Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 476, 105 S. Ct. 2174, 2184, 85 L. Ed.
2d 528, 543 (1985). The Supreme Court has indicated that:
Although territorial presence frequently
will enhance a potential defendant's
affiliation with a State and reinforce the
reasonable foreseeability of suit there, it
is an inescapable fact of modern commercial
life that a substantial amount of business
is transacted solely by mail and wire
communications across state lines, thus
obviating the need for physical presence
within a State in which business is
conducted. So long as a commercial actor's
efforts are "purposefully directed" toward
residents of another State, we have
consistently rejected the notion that an
absence of physical contacts can defeat
personal jurisdiction there.
[Ibid.]
Thus, "the existence of minimum contacts turns on the
presence or absence of intentional acts of the defendant to
avail itself of some benefit of a forum state." Waste Mgmt.,
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supra, 138 N.J. at 126. After an examination of the defendant's
minimum contacts with the state, the court must determine
whether "the assertion of jurisdiction affect[s] traditional
notions of fair play and substantial justice." Blakey, supra,
164 N.J. at 69.
Ultimately, the presence or absence of personal
jurisdiction must be determined "on a case-by-case basis."
Bayway Ref. Co., supra, 333 N.J. Super. at 429. This analysis
requires a judicial examination of several elements in an effort
to satisfy the notions of "fair play and substantial justice."
Lebel, supra, 115 N.J. at 328. Specifically, the court must
consider:
[T]he burden on the defendant, the interests
of the forum [s]tate, and the plaintiff's
interest in obtaining relief. It must also
weigh in its determination "the interstate
judicial system's interest in obtaining the
most efficient resolution of controversies;
and the shared interest of the several
[s]tates in furthering fundamental
substantive social policies."
[Asahi Metal Indus. Co., Ltd. v. Super. Ct.
of Cal., 480 U.S. 102, 113, 107 S. Ct. 1026,
1033, 94 L. Ed. 2d 92, 105 (1987) (quoting
World-Wide Volkswagen, supra, 444 U.S. at
292, 100 S. Ct. at 564, 62 L. Ed. 2d at
498).]
With those precedents in view, we turn to consider whether
Baanyan has met its burden of establishing a prima facie basis
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for exercising personal jurisdiction over defendant. See
Blakey, supra, 164 N.J. at 71. Because the trial court
dismissed the action on defendant's motion prior to discovery,
we assume that Baanyan can establish all of its allegations and
assertions. NCP Litig. Trust v. KPMG LLP, 187 N.J. 353, 365-66
(2006). Our review of the trial court's ruling on a motion to
dismiss for lack of jurisdiction at the inception of the case is
de novo. Mastondrea v. Occidental Hotels Mgmt. S.A., 391 N.J.
Super. 261, 268 (App. Div. 2007).
The extensive contacts required for establishing general
jurisdiction are not present here. It is undisputed that
defendant never resided nor did business in New Jersey, and that
at all relevant times she acted in Illinois, servicing two of
Baanyan's customers located there.
To establish specific jurisdiction, plaintiff argues that
defendant purposefully sought out employment from Baanyan. As
noted, the burden is on Baanyan to "allege or plead sufficient
facts" to warrant the court's exercise of jurisdiction, see
Blakey, supra, 164 N.J. at 71, and it must do so by way of
"sworn affidavits, certifications, or testimony." Jacobs,
supra, 309 N.J. Super. at 454 (quoting Catalano v. Lease &
Rental Mgmt. Corp., 252 N.J. Super. 545, 547-48 (Law Div.
1991)). In the present litigation, the record simply does not
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support Baanyan's argument. The certification of Baanyan's
president, Raghu Daripali, merely states that plaintiff and
defendant "entered into a Consultant Agreement" whereby
plaintiff would employ defendant as a consultant. Defendant's
supplemental certification, on the other hand, avers that she
"was recommended to [Baanyan] by a sales person, Sai Sudani, who
worked . . . at Baanyan's office in Hyderabad, India," and that
defendant discussed the terms and conditions with Baanyan's
representatives in India. Additionally, Baanyan's website
proclaims that it "finds and retains qualified professionals,"
and, "[r]eaching out from its locations in USA and India, [it]
is able to locate and attract the very best computing talent
from all over the globe." Thus, contrary to plaintiff's
argument, there is no evidence in the record to support the
contention that defendant sought out employment with Baanyan in
New Jersey.
Additionally, we have held that telephonic and electronic
communications with individuals and entities located in New
Jersey alone, are insufficient minimum contacts to establish
personal jurisdiction over a defendant. Pfundstein v. Omnicon
Grp. Inc., 285 N.J. Super. 245, 252 (App. Div. 1995). In
Pfundstein, the panel found that New Jersey courts did not have
jurisdiction over a New York corporation that executed a
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severance agreement with the plaintiff, an executive of the New
York corporation's subsidiary. Ibid. The court noted that
negotiation of the provisions of the agreement via telephonic
and interstate mail communications was not an attempt by the
defendant to "tap an interstate market or avail itself of the
privilege of doing business" in New Jersey, but rather was "a
'fortuitous' or 'attenuated' contact between [the defendant] and
New Jersey." Ibid. Thus, the court held that New Jersey could
not exercise specific jurisdiction over the defendant. Ibid.
Similarly, the fact that defendant received payment from
Baanyan, and submitted timesheets to Baanyan, does not support a
finding of personal jurisdiction as this was all done
electronically and did not require any contact with New Jersey.
See Mellon Bank (EAST) PSFS, N.A. v. DiVeronica Bros., Inc., 983
F.2d 551, 555 (3d Cir. 1993) (noting that courts have rejected
the notion that accepting checks drawn on a bank in the forum
state is a valid basis for finding jurisdiction).
Finally, Baanyan argues that subjecting defendant to
personal jurisdiction in New Jersey does not offend traditional
notions of fair play and substantial justice. However,
plaintiff's interest in obtaining relief is but one of the facts
that we must consider in determining whether the exercise of
personal jurisdiction over defendant here is reasonable.
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Nothing in the record supports a finding that plaintiff, a
multinational corporation, could not obtain the relief it seeks
in Tennessee, where defendant resides, or in Illinois, where all
of defendant's consulting services were rendered, and Baanyan's
customers who benefited therefrom are located. Moreover, any
breach of contract or tort that was allegedly committed occurred
in Illinois. New Jersey's nexus to, and interest in, the
dispositive events that occurred in Illinois, is virtually
nonexistent.
In summary, we conclude that defendant's contacts with New
Jersey are attenuated at best. They are not continuous and
systematic so as to establish general jurisdiction. They are
more akin to random, fortuitous contacts, rather than a
purposeful availment of the benefits and privileges of New
Jersey law, and hence are likewise insufficient to establish
specific jurisdiction. Additionally, to allow Baanyan, an
international company, to compel an individual employee to
defend against a New Jersey lawsuit, where that employee was
hired to work in Illinois, and never lived in, worked in, or
visited New Jersey, violates principles of "fair play and
substantial justice." Lebel, supra, 115 N.J. at 328. We are
therefore satisfied that the facts support the trial judge's
finding that Baanyan failed to establish that defendant has
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sufficient minimum contacts with the State of New Jersey for
jurisdiction to exist.
Affirmed.
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