Allure Pet Products, LLC v. Donnelly Marketing & Development LLC ( 2024 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-0429-23
ALLURE PET PRODUCTS,
LLC,
Plaintiff-Respondent, APPROVED FOR PUBLICATION
January 17, 2024
v.
APPELLATE DIVISION
DONNELLY MARKETING &
DEVELOPMENT LLC, d/b/a
CONCORD EXPO GROUP, and
KATHY LYNN KAZMAIER
DONNELLY, individually,
Defendants-Appellants.
___________________________
Argued January 8, 2024 – Decided January 17, 2024
Before Judges Sabatino, Mawla, and Marczyk.
On appeal from an interlocutory order of the Superior
Court of New Jersey, Law Division, Morris County,
Docket No. L-1281-21.
Joshua Matthew Lurie argued the cause for appellants
(Lurie Strupinksy, LLP, attorneys; Joshua Matthew
Lurie, on the brief).
Joseph M. Morgese argued the cause for respondent
(Wilson, Elser, Moskowitz, Edelman & Dicker, LLP,
attorneys; Joseph M. Morgese, of counsel and on the
brief).
The opinion of the court was delivered by
SABATINO, P.J.A.D.
This interlocutory appeal solely concerns an issue of personal
jurisdiction. The issue is whether our state court has personal jurisdiction over
a defendant Utah company and its owner who entered into a contract to reserve
exhibition space for plaintiff, a New Jersey pet product supplier, at a biannual
trade show in Germany planned for 2020. The trade show was eventually
postponed because of the COVID-19 pandemic, and the company and its
owner declined to refund plaintiff's payment or apply it to the next show in
2022.
Defendants argue they lacked the required "minimum contacts" to be
sued in New Jersey, stressing that plaintiff originally initiated the parties '
relationship in 2011 by asking defendants to arrange for space at an earlier
trade show in 2012. They further contend it would offend constitutional
principles of fair play and substantial justice to compel them to litigate this
civil case in this state so distant from Utah.
For the reasons that follow, we affirm the trial court's finding of personal
jurisdiction under these circumstances. As a matter of law, it is not dispositive
that the New Jersey plaintiff originally initiated contact with the Utah
company and its owner years before the present transaction. The record shows
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the Utah defendants sought and procured renewal contracts with plaintiff for
the next four biannual trade shows, including 2020. In addition, the Utah
defendants repeatedly solicited new or renewal business from at least ten other
New Jersey pet companies during that time frame. Given that conduct, the
Utah defendants "purposely availed" themselves of doing business with New
Jersey customers to a level sufficient to satisfy the criteria for in personam
jurisdiction under the Due Process Clause. The norms of fair play and
substantial justice are not offended here.
I.
We derive the pertinent facts, as did the motion judge, from the
jurisdictional discovery exchanged between the parties.
Plaintiff Allure Pet Products, LLC ("Allure") is a wholesale and
consumer pet product supplier based in Denville, New Jersey. Allure is co-
owned by two New Jersey residents. In this lawsuit, Allure seeks recovery of
$14,256.80 it paid to defendant Donnelly Marketing & Development LLC
(d/b/a "Concord"), a Utah company, for services it claims it did not receive.
Concord's sole member and owner is co-defendant Kathy Lynn Kazmaier
Donnelly. Her father had previously founded the company in or about 2003 or
2004, and she took over the business after he passed away in 2013. Donnelly
operates the business from Utah.
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As described in Donnelly's deposition testimony, Concord organizes a
variety of international trade shows. Among other things, Concord arranges
for exhibitors to have booths to display their products and services at the trade
shows. Concord's "turnkey package" includes assistance with marketing and
promotion within the trade show, hotel accommodations, translators, on -site
cleaning, security, and lounges with food and drink.
One of those trade shows is "Interzoo," in which vendors of pet products
and services from around the world participate. The Interzoo show is
customarily held biannually. Apparently, the only means for an exhibitor to
obtain space within the United States Pavilion at the show, other than through
Concord, is to share a booth with another exhibitor or to make arrangements
directly with Interzoo.
The parties' relationship began in September 2011 when Robert Flynn, a
co-owner of Allure, telephoned Donnelly and asked whether Allure could
obtain a booth at the upcoming Interzoo show planned for 2012. Donnelly
responded to Flynn through an email and offered her company's services. She
then contacted the Interzoo project team to arrange space for Allure at the
2012 show. That initial transaction went forward, with Allure paying Concord
for its services.
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In or about early 2013, Donnelly sent all of its 2012 Interzoo exhibitors,
including Allure, what she described as a "special offer" to renew their space
for the next Interzoo show in 2014. The offer extended to past customers the
same space and services at the same rates. Allure took advantage of Concord's
renewal offer and, in fact, increased its amount of reserved space for the 2014
show.
The same pattern repeated for the 2016 and 2018 Interzoo shows, with
Concord extending its special offer, and Allure renewing space through
Concord, with some adjustments of its booth location. As Donnelly recalled,
she generally sent the special offers by certified mail, to ensure their receipt by
the past customers. Allure was among the clients that were mailed these
special offers. If an exhibitor chose to renew, it would send back to Concord a
signed copy of the contract and a check for the deposit.
The present dispute arose in connection with the Interzoo show that had
been planned for May 2020 in Nuremberg, Germany. As per its custom, after
the 2018 show, Concord extended Allure a special offer to renew for 2020.
On April 26, 2019, Donnelly sent Allure an email attaching the special
offer for 2020. The special offer specified a 30.24 square meter "island
turnkey stand" within the United States Pavilion, plus a catalogue listing and
communications package, for a total price of $14,256.80. Donnelly asked
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Allure to respond by emailing back the signed contract within four days and
paying a deposit within thirty days.
Allure's representative, Julie Krauss, emailed Donnelly back and
requested the tentative floor plan for the 2020 show. In reply, Donnelly
emailed Krauss a working diagram of the floor plan but noted she had shared
the diagram with a few other companies that also might want to move their
booth location.
Four days after receiving Concord's renewal offer for the 2020 show,
Krauss emailed Donnelly and advised her that "after much deliberation,"
Allure agreed to renew the same booth from the 2018 show for 2020. The
email noted "[w]e can work on the details later" and that Allure would arrange
to pay the deposit, followed by the remaining balance due in December.
Donnelly responded with more details and reminded Krauss to send back the
contract and deposit in order to "secure the space." The parties thereafter
mutually signed the contract, and Allure paid the full balance.
Subsequently, in early 2020, the worldwide COVID-19 pandemic caused
the sponsor to cancel the 2020 Interzoo show. The sponsor initially announced
it would reschedule the event in 2021. At Concord's suggestion, Allure agreed
to take part in the rescheduled show in 2021 under their preexisting contract.
As the pandemic lingered, the sponsor decided to postpone the show
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until 2022. At that point, Allure asked Concord to apply its deposit to the
2022 show. When Concord declined to do so, Allure demanded its money
back. Concord was unwilling to refund the money, asserting that Allure bore
the risk of the 2020 show's cancellation. It pointed to language within its form
contract stating that plaintiff's deposit of the total participation fee was non-
refundable.1
These events prompted Allure to sue Concord and Donnelly in the Law
Division, seeking repayment of the funds it paid and other relief. Defendants
moved to dismiss the complaint under Rule 4:6-2,2 alleging our courts lack
personal jurisdiction over them. Defendants also asserted plaintiff's complaint
failed to state a claim upon which relief may be granted. The trial court
ordered jurisdictional discovery, which the parties completed through the
exchange of documents and interrogatory answers, and the remote depositions
of Donnelly and Krauss.
One of the key documents supplied by defendants in discovery was a
chart Donnelly prepared that shows Concord's interactions with New Jersey
1
We need not address here the merits of the parties' positions and instead
confine our discussion to the jurisdictional issue.
2
Although not specified in the motion papers or appellate briefs, the pertinent
portion of Rule 4:6-2 for this jurisdictional ground is subsection (b).
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customers for the 2012, 2014, 2016, 2018, and 2020 Interzoo shows. 3
Depending on how the numbers are counted, the chart reflects that Concord
has done business with ten or more New Jersey customers, including Allure,
during that time span, most of them renewing their space every two years. As
Donnelly recounted during her deposition and as the chart reflects, some of
those New Jersey customers date back to the early 2000s when her father
owned the business.
Upon considering the discovery and hearing oral argument, the trial
court denied defendants' motion. In his initial written decision, the motion
judge concluded the court had specific, but not general, personal jurisdiction
over defendants in connection with the contract. The judge observed, in
particular, that the complaint alleges a contract involving a New Jersey
company. The judge made other rulings bearing upon non-jurisdictional issues
not before us.
Defendants moved for reconsideration. The judge again denied their
motion. Among other things, the judge made note of plaintiff's argument that
the discovery showed defendants "were conducting business with New Jersey-
3
According to Donnelly, some of the records from previous years were lost
due to computer problems, so she reconstructed the information and presented
it in the composite chart. The chart was the subject of extensive questioning at
Donnelly's deposition and has been helpful to our analysis.
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based pet products entities over the course of [eight] years."
Defendants moved for leave to appeal, which we granted but "solely
with respect to the jurisdictional ruling and the trial court's subsequent denial
of reconsideration."
II.
As we noted at the outset, defendants emphasize that plaintiff is the
party that initiated contact with them in 2011, unsolicited, and therefore they
did not purposefully avail themselves of business in this state. They further
stress that they are located in Utah, have not physically entered New Jersey,
and that the trade show in question had been planned to occur abroad in
Germany. Defendants also argue that even if minimum contacts and
purposeful availment are present, it would be unfair to force them to litigate
this case far away in New Jersey.
The general principles of in personam jurisdiction we apply here have
been long established. New Jersey courts "may exercise in personam
jurisdiction over a non-resident defendant 'consistent with due process of
law.'" Bayway Refin. Co. v. State Utils., Inc., 333 N.J. Super. 420, 428 (App.
Div. 2000) (alterations omitted) (quoting R. 4:4-4(b)(1)). Our courts exercise
jurisdiction over nonresident defendants "to the uttermost limits permitted by
the United States Constitution." Jardim v. Overley, 461 N.J. Super. 367, 377
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(App. Div. 2019) (quoting Avdel Corp. v. Mecure, 58 N.J. 264, 268 (1971)).
A two-part test governs an analysis of personal jurisdiction: (1)
defendant must have "minimum contacts" with the forum state; and (2)
maintaining the suit in that state cannot offend "traditional notions of fair play
and substantial justice." Int'l Shoe Co. v. Washington, 326 U.S. 310, 316
(1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463 (1940)). "[T]he
requisite quality and quantum of contacts is dependent on whether general or
specific jurisdiction is asserted . . . ." Citibank, N.A. v. Est. of Simpson, 290
N.J. Super. 519, 526 (App. Div. 1996).
General jurisdiction "requires affiliations 'so "continuous and
systematic" as to render'" a non-resident organizational defendant "'essentially
at home in the forum State.'" Daimler AG v. Bauman, 571 U.S. 117, 133 n.11
(2014) (quoting Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S.
915, 919 (2011)).
Both parties agree that Concord and Donnelly are not subject to general
jurisdiction in New Jersey. Accordingly, as the motion judge correctly
recognized, the court must focus here on whether there is specific jurisdiction
over those defendants.
Specific jurisdiction depends on the "relationship among the defendant,
the forum, and the litigation." Lebel v. Everglades Marina, Inc., 115 N.J. 317,
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323 (1989) (quoting Shaffer v. Heitner, 433 U.S. 186, 204 (1977)). The
litigation must "aris[e] out of or relate[] to the defendant's contacts with the
forum." Daimler AG, 571 U.S. at 127 (quoting Helicopteros Nacionales de
Colombia, S.A. v. Hall, 466 U.S. 408, 414, n.8 (1984)).
Unlike the continuous and systematic contact requirements of general
jurisdiction, specific jurisdiction requires only "minimum contacts" resulting
"from the defendant's purposeful conduct and not the unilateral activities of the
plaintiff." Lebel, 115 N.J. at 323. A single act can support jurisdiction, so
long as the defendant created a "substantial connection" with the forum.
Maglio & Kendro, Inc. v. Superior Enerquip Corp., 233 N.J. Super. 388, 396
(App. Div. 1989) (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476
n.18 (1985)). "This 'purposeful availment' requirement ensures that a
defendant will not be haled into a jurisdiction solely as a result of 'random,'
'fortuitous,' or 'attenuated' contacts." Lebel, 115 N.J. at 323-24 (quoting
Burger King, 471 U.S. at 475).
Upon considering a defendant's contacts, courts analyze "whether the
defendant should 'reasonably anticipate being haled into court [in the forum
state].'" Bayway, 333 N.J. Super. at 429 (alteration in original) (quoting
World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297-98 (1980)).
The analysis is often fact-sensitive. See, e.g., JA/GG Doe 70 v. Diocese of
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Metuchen, __ N.J. Super. __, __ (App. Div. 2023) (finding purposeful
availment where a Virginia diocese retained control over a priest sent to serve
in New Jersey despite the Virginia diocese's awareness of priest's sexual
propensities towards children); D.T. v. Archdiocese of Philadelphia, __ N.J.
Super. __, __ (App. Div. 2023) (finding no such purposeful availment where
another archdiocese owned property in New Jersey in the past but had no
knowledge of a Pennsylvania priest's transportation of a minor to New Jersey) .
Apart from this analysis, due process also requires the extension of
jurisdiction be reasonable under the circumstances by comporting with
"traditional notions of fair play and substantial justice." Asahi Metal Indus.
Co. v. Super. Ct. of Cal., 480 U.S. 102, 113 (1987) (quoting Int'l Shoe, 326
U.S. at 316). A court "must consider the burden on the defendant, the interests
of the forum State, and the plaintiff's interest in obtaining relief." Ibid. The
court must also weigh "the interstate judicial system's interest in obtaining the
most efficient resolution of controversies; and the shared interest of the several
States in furthering fundamental substantive social policies." Ibid. (quoting
World-Wide Volkswagen, 444 U.S. at 292).
On appeal, we apply these principles based on the record amassed before
the motion judge. As a "mixed question of law and fact," Citibank, 290 N.J.
Super. at 532, personal jurisdiction entails findings of fact that are reviewed
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for "substantial, credible evidence in the record" and legal conclusions that are
reviewed de novo, Rippon v. Smigel, 449 N.J. Super. 344, 358 (App. Div.
2017). The trial court's findings of fact concerning jurisdiction must be upheld
if they are supported by substantial credible evidence, ibid., although "[a] trial
court's interpretation of the law and the legal consequences that flow from
established facts are not entitled to any special deference." Manalapan Realty,
L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995).
Here, because the motion judge did not conduct an evidentiary hearing
or make any direct observations of witness credibility—and appellants do not
argue the judge was required to conduct such a hearing—we essentially
perform a de novo review of the same motion record.
III.
Applying these principles, it is abundantly clear that defendants engaged
in the minimum level of contacts with Allure (and with other New Jersey
customers) sufficient to support specific jurisdiction in this state. By their
repetitive actions in soliciting and re-soliciting Allure to renew trade show
business every two years for at least eight years, defendants "purposefully
availed" themselves of the benefits of that commercial relationship.
Defendants leveraged their role as the apparent exclusive broker of exhibition
space in the United States Pavilion. They further promoted that business by
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extending "special offers" to entice Allure and other returning customers.
We recognize that when purposeful availment is found, the defendant
often initiated the very first contact with the plaintiff in the forum state. See,
e.g., Avdel, 58 N.J. at 267 (in which the New York defendant "requested one
of the [New Jersey] plaintiff's salesmen to come to a job site in New York for
a demonstration" and, days later, ordered rivets from defendant by telephone);
Maglio, 233 N.J. Super. at 391 (in which a Pennsylvania defendant initially
telephoned the New Jersey plaintiff "seeking to engage plaintiff's services to
search for a new general manager for defendant's Pennsylvania office"). See
also Burger King, 471 U.S. at 467-87 (in which a Michigan defendant applied
for a franchise application from a plaintiff company headquartered in Florida,
with an apparent intention to create a multi-year relationship with plaintiff);
Power Invs., LLC v. SL EC, LLC, 927 F.3d 914, 919 (6th Cir. 2019) (in which
a Missouri defendant solicited financing from a Kentucky plaintiff to purchase
a power plant in Missouri); Waimberg v. Med. Transp. of Am., Inc., 52 F.
Supp. 2d 511, 513-16 (E.D. Pa. 1999) (in which a Nevada defendant faxed an
offer letter to a Pennsylvania plaintiff inviting him to become a financial
officer of a company in Las Vegas).
However, as this case illustrates, such first contact is not always
jurisdictionally dispositive. The 2012 contract between Allure and Concord
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was not a "one-off," as that term is used in current parlance. Cf. Jardim, 461
N.J. Super. at 383 (involving a single sale of a used car between strangers,
described as a "one-shot affair"). Instead, Concord repeated its efforts over
four consecutive trade shows to solicit Allure's renewal business, and to profit
from those renewals. The "special offers" Concord extended and promoted
were designed to extract more revenue from Allure and other New Jersey
exhibitors.
Defendants argue it is improper to consider the other ten or more New
Jersey customers depicted on the chart, asserting that those contacts bear only
upon general jurisdiction and not specific jurisdiction. We do not adopt such a
narrow view of that evidence. The chart substantiates that defendants'
repeated biannual interactions were not isolated. Instead, they were consistent
with a business pattern and practice of maintaining relationships an d a stream
of income from such New Jersey clientele.
We are also satisfied that the exercise of personal jurisdiction over
defendants in this state will not offend traditional principles of fair play or
substantial justice. Defendants knew they were dealing with a repeat customer
located in New Jersey. They did not include a forum selection clause in their
form contract, which could have required disputes to be litigated in Utah or
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some other designated venue. See, e.g., Burger King, 471 U.S. at 481 (treating
a forum selection clause as pertinent to the Due Process analysis).
We further note this is a non-jury case involving a modest amount of
money and a limited number of witnesses. The initial deposition of Donnelly,
who may well be defendants' sole witness, was conducted remotely. Counsel
is free to request that any additional depositions or testimony in a bench trial
be similarly conducted remotely, subject to the trial court's discretion. See
Pathri v. Kakarlamath, 462 N.J. Super. 208, 212-21 (App. Div. 2020)
(explaining factors that bear upon the trial court's discretion to allow remote
testimony). We discern no unfair burden.
In sum, although we do not adopt the motion judge's express reasoning
that hinged upon the complaint's reference to the existence of the contract, we
affirm the court's finding of personal jurisdiction over these defendants. See
Isko v. Planning Bd. of Livingston Twp., 51 N.J. 162, 175 (1968) (appellate
court may affirm a judgment on different grounds than those identified below).
Affirmed.
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