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Trial Court Finds Plaintiff Lacks Personal Jurisdiction over Holding Company Defendant

Court: Supreme Court of New York, New York County

Plaintiffs Michele Stuck and Jack Bannister, individually and as executors of the estate of Penelope Rigsby, brought an action against countless cosmetic manufacturers, including BATUS Holding Inc. Plaintiffs sued BATUS individually and as successor-in-interest to British American Cosmetics, Yardley Co., and Yardley of London Inc. 

On the other hand, BATUS argued that as a holding company it never placed any products into the stream of commerce and thus has no ties to the State of New York. Plaintiff countered that personal jurisdiction over BATUS existed because of its relationship with the manufactures of Yardley of London talcum powder products, which allegedly contributed to the decedent’s illness and death. BATUS moved to dismiss plaintiffs’ action based on this supposed lack of personal jurisdiction. 

To find personal jurisdiction, the court must determine whether it has a general or specific jurisdiction over the moving defendant, in this case BATUS. New York’s general jurisdiction statute CPLR § 301 and its long arm statute CPLR § 302(a) govern over a non-domiciliary defendant. According to CPLR § 301, general jurisdiction exists when a defendant’s “affiliations with the State [of] New York are so continuous and systematic as to render it essentially at home in the…State.”  Robins v. Procure Treatment Ctrs., Inc., 157 A.D.3d 606, 607 (1st Dept. 2018) (internal citations omitted). Crucially, “aside from an exceptional case, a corporation is at home only in a state that is the company’s place of incorporation or its principal place of business.”  Lowy v. Chalkable, LLC, 186 A.D.3d 590, 592 (2d Dept. 2020) (internal citations omitted) (emphasis added). 

Moreover, the court recognized, “The relevant inquiry regarding a corporate defendant’s place of incorporation and principal place of business, is at the time the action is commenced.”  Stuck v. Avon Prods., Inc., 202023 NY Slip Op 33488[U], *3 [Sup Ct, NY County 2023]); see Lancaster v. Colonial Motor Freight Line, Inc., 177 A.D.2d 152, 156 (1st Dept. 1992). The court found it was uncontested that BATUS’s principal place of business was outside the State of New York and that it was not incorporated in said state either.  As such, it was clear general personal jurisdiction was not applicable to this defendant. 

Turning to New York State’s long arm statute, CPLR § 302(a) declares that specific jurisdiction may be exercised over a non-resident who:

(1) transacts any business within the state or contracts anywhere to supply goods or services in the state; or (2) commits a tortious act within the state…; or (3) commits a tortious act without the state causing injury to person…within the state…if he (i) regularly does or solicits business, or engages in any other persistent course of conduct, or derives substantial revenue from goods used or consumed or services rendered, in the state, or (ii) expects or should reasonably expect the act to have consequences in the state and derives substantial revenue from interstate or international commerce; or (4) owns, uses or possesses real property situated within the state.

Stuck, 202023 NY Slip Op 33488[U], *4. BATUS relied on the affidavit of Lisa M. Oakes, its Corporate Secretary. Oakes’ affidavit stated that as a holding company, BATUS did not manufacture, design, distribute, supply, or sell any asbestos containing talcum powder. She affirmed the company had no nexus with NYS as it owned no real estate within it, had never been incorporated there, had never maintained its corporate offices there, had not contracted for goods or services there, was not licensed to conduct business there, and that BATUS was not the successor-in-interest to Yardley of London. 

The court concluded BATUS successfully established it did not transact business in NYS, did not commit a tortious act against the plaintiff in NYS, did not commit a tortious act against the plaintiff without the state which caused plaintiff injury within the state; and did not own real estate within the state.  Further, it found the plaintiff’s evidence allegedly connecting BATUS to NYS made no mention of the specific defendant and thus was insufficient. As a result, the court determined it had no general or specific jurisdiction over BATUS and granted the defendant’s motion to dismiss pursuant to CPLR § 3211(a)(8) on the grounds that it lacked personal jurisdiction.

Read the full decision here.