## Facts

- Nationwide Contractor Audit Service, Inc. provided audit and compliance services and operated as a competitor of National Compliance Management Services, Inc. (NCMS).
- Nationwide sued NCMS in Pennsylvania state court asserting state-law claims for tortious interference with prospective contractual relations and unfair competition.
- NCMS removed the case to the U.S. District Court for the Western District of Pennsylvania based on diversity jurisdiction.
- NCMS moved to dismiss under Rule 12(b)(2), arguing Pennsylvania lacked personal jurisdiction over it.
- Nationwide alleged NCMS interfered with Nationwide’s actual or prospective customers; the alleged competitive conduct was centered outside Pennsylvania, principally involving customers located outside Pennsylvania (including Kansas).
- NCMS was not incorporated in Pennsylvania, did not have its principal place of business there, and allegedly lacked offices, employees, or regular operations in Pennsylvania.

## Issues

1. Whether Pennsylvania could exercise specific personal jurisdiction over NCMS consistent with due process based on NCMS’s alleged forum-related contacts connected to the dispute.
2. Whether Pennsylvania could exercise general personal jurisdiction over NCMS based on “continuous and systematic” contacts.
3. Whether alleged economic injury felt by a Pennsylvania plaintiff, without conduct expressly aimed at Pennsylvania, can satisfy an “effects” theory of specific jurisdiction.

## Decision

- The court granted NCMS’s Rule 12(b)(2) motion and dismissed for lack of personal jurisdiction.
- The court held Nationwide failed to make a prima facie showing that NCMS had sufficient Pennsylvania contacts for either specific or general jurisdiction.
- The court rejected jurisdiction based solely on the claim that Nationwide experienced economic harm in Pennsylvania.
- The court identified Kansas as an available forum where NCMS would be subject to jurisdiction and where the dispute was centered.

## Legal Principles

- Pennsylvania’s long-arm statute extends jurisdiction to the constitutional limit; the analysis turns on federal due process.
- On a Rule 12(b)(2) motion, the plaintiff bears the burden to establish a prima facie basis for jurisdiction; factual conflicts are resolved in the plaintiff’s favor, but jurisdiction requires supporting allegations or proof.
- Specific jurisdiction requires purposeful direction of activities at the forum and a claim that arises out of or relates to those forum-directed contacts.
- General jurisdiction requires contacts so continuous and systematic that the defendant is essentially at home in the forum.
- Under an “effects” theory, it is insufficient that a plaintiff feels economic injury in the forum; the defendant must have expressly aimed the challenged conduct at the forum state.

## Conclusion

The court dismissed the action because NCMS’s alleged competitive conduct was not purposefully directed at Pennsylvania and NCMS lacked continuous and systematic Pennsylvania contacts; economic effects felt by the plaintiff in Pennsylvania, without forum-targeted conduct, did not establish personal jurisdiction.


Nationwide Contractor Audit Serv., Inc. v. Nat’l Compliance Mgmt. Servs., Inc., 622 F. Supp. 2d 276 (W.D. Pa. 2008)