Facts
- Jack Frummer, a New York resident, stayed at the London Hilton Hotel in 1963 and alleged he was injured in his room while attempting to shower.
- Frummer sued in New York seeking damages against Hilton (U.K.) Ltd., the operator of the London hotel, and related Hilton corporate entities doing business in New York.
- Hilton (U.K.) had no hotel operations or physical presence in New York.
- Hilton (U.K.) used a New York-based reservations and promotional operation (“Hilton Reservation Service”) connected to related Hilton companies.
- The New York reservations operation maintained a New York office, telephone listing, and bank account.
- The New York reservations operation was authorized to accept and confirm reservations for the London Hilton and regularly promoted the hotel and maintained contacts with travel agents in the United States.
- Hilton (U.K.) moved to dismiss for lack of personal jurisdiction under CPLR 3211(a)(8); the motion was denied and that denial was affirmed on appeal, leading to review by New York’s highest court.
Issues
- Whether New York could exercise specific (long-arm) jurisdiction over Hilton (U.K.) under CPLR 302(a)(1) on the theory that the claim “arose from” business transacted in New York.
- Whether New York could exercise general jurisdiction under CPLR 301 because Hilton (U.K.) was “doing business” in New York through the continuous and systematic activities of the in-state reservations operation.
Decision
- The court held CPLR 302(a)(1) did not apply because the plaintiff did not allege dealings in New York with Hilton (U.K.) or its agents and the injury claim did not arise from in-state transactions.
- The court held New York had jurisdiction under CPLR 301 because Hilton (U.K.) was doing business in New York through an in-state reservations operation conducting continuous and systematic activities essential to Hilton (U.K.)’s hotel business.
- The court affirmed the order denying Hilton (U.K.)’s motion to dismiss for lack of personal jurisdiction.
Legal Principles
- Under CPLR 301, a foreign corporation is subject to general jurisdiction in New York when it engages in a continuous and systematic course of doing business in the state sufficient to render it “present.”
- “Mere solicitation” in New York is insufficient for CPLR 301; solicitation plus additional substantial in-state services may establish presence.
- In-state activities of an affiliate or agent may be attributed to a foreign corporation for CPLR 301 purposes when the local entity performs services so important to the foreign corporation that, without the local entity, the foreign corporation would perform those services itself.
- CPLR 302(a)(1) requires an articulable nexus: the cause of action must arise from the defendant’s transaction of business within New York.
Conclusion
New York could not assert long-arm jurisdiction because the injury claim did not arise from Hilton (U.K.)’s New York activities, but it could assert general jurisdiction under CPLR 301 because the New York reservations office performed continuous, systematic, and essential functions—beyond solicitation—attributable to Hilton (U.K.).