Judge Mark A. Young, Case Number: 23SMCV05910, Date: 2024-06-06 Tentative Ruling

Judge: Mark A. Young, Case: 23SMCV05910, Date: 2024-06-06 Tentative Ruling

Case Number: 23SMCV05910 Hearing Date: June 6, 2024 Dept: M

CASE NAME: Clean Product Advocates LLC, et al., v. S. Bertram Inc., et al.

CASE NO.: 23SMCV05910

MOTION: Motion to Quash Service of Summons; Motion to Set Aside

HEARING DATE: 6/6/2024

Legal Standard

“A defendant . . . may serve and file a notice of motion for one or more of the following purposes: (1) To quash service of summons on the ground of lack of jurisdiction of the court over him or her . . ..” (CCP § 418.10(a).) A court lacks jurisdiction over a party if there has not been proper service of process. (Ruttenberg v. Ruttenberg (1997) 53 Cal.App.4th 801, 808.) “When a motion to quash is properly brought, the burden of proof is placed upon the plaintiff to establish the facts of jurisdiction by a preponderance of the evidence.” (Aquila, Inc. v. Sup. Ct. (2007) 148 Cal.App.4th 556, 568.) “[C]ompliance with the statutory procedures for service of process is essential to establish personal jurisdiction. [Citation.]” (Dill v. Berquist Construction Co. (1994) 24 Cal.App.4th 1426, 1444.) “[T]he filing of a proof of service creates a rebuttable presumption that the service was proper” but only if it “complies with the statutory requirements regarding such proofs.” (Id. at 1441-1442.)

EVIDENTIARY ISSUES

The parties’ requests for judicial notice are GRANTED.

Analysis

Defendant S. Betram Inc. moves to quash service of summons and moves to set aside default. The Court will first address the motion to quash. Defendant argues that the Court lacks personal jurisdiction because there are insufficient contacts between it and California. As it is undisputed that Defendant is not a resident of California, the motion is properly brought. Plaintiff therefore must demonstrate all facts necessary to support personal jurisdiction against Defendant.

The extent to which a California court can exercise personal jurisdiction over a non-resident defendant depends on the nature and quality of defendant's “minimum contacts” with the state. (See International Shoe Co. v. Washington (1945) 326 U.S. 310, 316.) “Minimum contacts” refers to the relationship between the nonresident and the forum state is such that the exercise of jurisdiction does not offend traditional notions of fair play and substantial justice. (Id.; Asahi Metal Industry Co. v. Superior Court (1987) 480 U.S. 102.) A court may assume specific jurisdiction over a nonresident, if the nonresident purposefully directed its activities at forum residents, or purposefully availed itself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of local law. (Hanson v. Denckla (1958) 357 U.S. 235.) Specific jurisdiction involves a three-part test: (1) the nonresident defendant must do some act or consummate some transaction with the forum or perform some act by which he purposefully avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws; (2) the claim must be one which arises out of or results from the defendant's forum-related activities; and (3) exercise of jurisdiction must be reasonable.”¿¿(Jewish Defense Organization, Inc. v. Sup. Ct. of Los Angeles County (1999) 72 Cal.App.4th 1045, 1054 [purposeful¿availment¿exists where a defendant performed some type of affirmative conduct which allows or promotes the transaction of business within the forum state].)

“ ‘ “The purposeful availment inquiry ... focuses on the defendant's intentionality. [Citation.] This prong is only satisfied when the defendant purposefully and voluntarily directs [its] activities toward the forum so that [it] should expect, by virtue of the benefit [it] receives, to be subject to the court's jurisdiction based on” [its] contacts with the forum.’ [Citation.] Thus, purposeful availment occurs where a nonresident defendant ‘ “purposefully direct[s]” [its] activities at residents of the forum’ [citation], ‘ “purposefully derive[s] benefit” from’ its activities in the forum [citation], ‘create[s] a “substantial connection” with the forum’ [citation], ‘ “deliberately” has engaged in significant activities within’ the forum [citation], or ‘has created “continuing obligations” between [itself] and residents of the forum’ [citation]. By limiting the scope of a forum's jurisdiction in this manner, the ‘ “purposeful availment” requirement ensures that a defendant will not be haled into a jurisdiction solely as a result of “random,” “fortuitous,” or “attenuated” contacts....’ [Citation.] Instead, the defendant will only be subject to personal jurisdiction if ‘ “it has clear notice that it is subject to suit there, and can act to alleviate the risk of burdensome litigation by procuring insurance, passing the expected costs on to customers, or, if the risks are too great, severing its connection with the state.” ’ [Citation.]” (Snowney v. Harrah’s Entertainment (2005) 35 Cal.4th 1054, 1062-1063.)

In the context of products liability, defendant’s placement of a product into the stream of commerce alone does not establish minimum contacts with a forum state. (J. McIntyre Machinery, Ltd. v. Nicastro (2011) 564 US 873, 885-886; see Bombardier Recreational Products, Inc. v. Dow Chemical Canada ULC (2013) 216 Cal.App.4th 591, 603-604 [knowledge that defendant's products would eventually be used in California insufficient to establish jurisdiction in California]; Dow Chemical Canada ULC v. Sup.Ct. (2011) 202 Cal.App.4th 170, 179 [no minimum contacts with California found where Canadian manufacturer “might have predicted or known that its products would reach California”].) “The placement of a product into the stream of commerce, without more, is not an act of the defendant purposefully directed toward the forum State. Additional conduct of the defendant may indicate an intent or purpose to serve the market in the forum State, for example, designing the project for the market in the forum State, advertising in the forum State, establishing channels for providing regular advice to customers in the forum State, or marketing the product through a distributor who has agreed to serve as the sales agent in the forum State.” (Asahi, supra, 480 US at 112, plur. opn. of O'Connor, J; see also World-Wide Volkswagen Corp. v. Woodson (1980) 444 US 286, 297 [a purchaser's unilateral activity of bringing goods into a forum state does not constitute “purposeful availment” by an out-of-state retailer or distributor].) California courts have accordingly held that, where products are not sold in a state as part of the regular and anticipated flow of commerce into that state, mere foreseeability that products could reach the forum state is not enough to establish minimum contacts. (Bombardier, supra, 216 Cal.App.4th at 604; see Luberski, Inc. v. Oleificio F.LLI Amato S.R.L. (2009) 171 Cal.App.4th 409 [Italian company entered into a direct sales contract with a California business purposefully had availed itself of the California forum]; cf. Carretti v. Italpast (2002) 101 Cal.App.4th 1236 [company lacked contacts where product sold to retailer in Italy, it had no offices or employees in US, it did not market, advertise or sell its products directly to California users, and there was only one California distributor who purchased its product].)

Defendant, for its part, presents unrebutted evidence that denies the hallmarks of minimum contacts. (Weitz Decl., paras. 7-15.) Defendant explains that it is a food service company distributing fresh produce, grocery, frozen and canned foods. Defendant operates out Linden, New Jersey. Bertram’s direct distribution is made primarily within New York, New Jersey, and Connecticut. (Id., para. 9.) Bertram does not advertise or distribute the Product to any customer or person in California. (Id., paras. 10-12.) Defendant does sell the product to third party distributors, but once delivered they lose all control over the product. (Id., paras. 13-14.) Defendant has a website from which customers may make purchases. (Id. para. 15.) However, purchases can only be made through user accounts, and there are no users in California. (Id.)

Plaintiff does not present sufficient evidence showing Defendant’s purposeful availment. Plaintiff only cites Defendant’s placement of the subject product into the stream of commerce, with the mere possibility that it would end up in California. Plaintiff claims that Defendant distributed its product in California. Plaintiff only cites a representation that the product was “Distributed by S. BERTRAM INC.” While this shows that the product was distributed by Defendant, this would not necessarily show Defendant sold the product to a California distributor, or knew that a third party distributor would sell the product in California. Plaintiff cites an “interactive website” wherein Defendant admits that it offers services to its customers in the “Tri-State” area and “across the globe.” (Ex. C.) However, no part of the website suggests that Defendant directed this website or services to Californians. In fact, the website apparently requires a customer to register as a user. (Id.) Defendant notes that they only sell to registered users, and there are no users registered in California. (Weitz Decl., para. 15.)

Here, Plaintiff presents no evidence that Defendant directly distributed the subject product to California, directed any marketing at California, or otherwise created any continuing obligations to distribute products in California. Plaintiff does not present any evidence that Defendant knew that the product would be distributed to California consumers. Thus, Plaintiff only shows that Defendant placed the product into the stream of commerce.

Considering the undisputed record, Plaintiff failed to establish Defendant’s purposeful availment. Defendant therefore lacks the necessary minimum contacts with California to support personal jurisdiction. Accordingly, the motion to quash is GRANTED.

Lack of personal jurisdiction renders a default void. (Strathvale Holdings v. E.B.H., (2005) 126 Cal. App. 4th 1241, 1250.) As the Court lacks personal jurisdiction over Defendant, the default against Defendant is void. (CCP § 473(d).) Accordingly, Defendant’s motion to vacate the default is GRANTED.