1996 Decisions

Opinions of the United

States Court of Appeals

for the Third Circuit

1-26-1996

Vetrotex Certainteed Corp. v. Consolidated Fiber

Glass Prod. Co.

Precedential or Non-Precedential:

Docket 94-2058

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Recommended Citation

"Vetrotex Certainteed Corp. v. Consolidated Fiber Glass Prod. Co." (1996). 1996 Decisions. Paper 252.

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1 

UNITED STATES COURT OF APPEALS 

FOR THE THIRD CIRCUIT 

------------ 

No. 94-2058 

------------ 

VETROTEX CERTAINTEED CORPORATION, 

Appellant

v. 

CONSOLIDATED FIBER GLASS PRODUCTS COMPANY 

---------- 

On Appeal from the United States District Court 

for the Eastern District of Pennsylvania 

(D.C. Civil No. 94-2947) 

---------- 

Argued Monday, December 11, 19950

BEFORE: ROTH, LEWIS and GARTH, Circuit Judges

---------- 

(Opinion filed January 26, 1996) 

---------- 

 Jon A. Baughman, Esq. (Argued) 

 Pepper, Hamilton & Scheetz 

 3000 Two Logan Square 

 18th & Arch Streets 

 Philadelphia, PA 19103-2799 

 Attorney for Appellant

 

0

This matter was originally heard on June 27, 1995 before Judges 

Hutchinson, Roth, and Garth. Because Judge Hutchinson died prior 

to an opinion being rendered, the Panel was reconstituted to 

include Judge Lewis, and the appeal was reargued. 
2 
2 

 Virginia H. McMichael, Esq. (Argued) 

 Dilworth, Paxson, Kalish & 

 Kauffman 

 3200 Mellon Bank Center 

 1735 Market Street 

 Philadelphia, PA 19103 

 Wesley G. Beverlin, Esq. 

 Knapp, March, Jones & Duran 

 515 South Figueroa Street 

 Suite 1400, Manulife Plaza 

 Los Angeles, CA 90071 

 Attorneys for Appellee

 

 

 ---------- 

 OPINION OF THE COURT 

 ---------- 

GARTH, Circuit Judge: 

 Plaintiff-appellant Vetrotex CertainTeed Corporation 

("Vetrotex"), a Pennsylvania corporation, brought suit in the 

federal district court for the Eastern District of Pennsylvania 

against defendant-appellee Consolidated Fiber Glass Products 

Company ("Conglas"), a California corporation. The issue 

presented in this appeal is whether the district court properly 

dismissed the complaint of Vetrotex for lack of personal 

jurisdiction. Because it is not contested that general 

jurisdiction does not lie, and because we find that Conglas has 

not purposefully directed its activities toward Pennsylvania for 

purposes of specific jurisdiction, we will affirm. 

I. 
3 

 Vetrotex is a Pennsylvania corporation engaged in the 

manufacture and sale of various fiber glass reinforcement 

products. Vetrotex, which was incorporated in March of 1991, is 

a wholly-owned subsidiary of CertainTeed Corporation 

("CertainTeed"), another Pennsylvania corporation. Vetrotex is a 

national corporation with facilities and offices in several 

states, including California. Conglas is a California 

corporation engaged in the manufacture of fiber glass roofing 

products, including fiber glass mats. Conglas has no offices, 

employees or representatives in Pennsylvania, nor has it ever 

sold any of its products in Pennsylvania, or engaged in sales to 

distributors or other third parties who sell Conglas products in 

Pennsylvania. 

 Between 1980 and 1989, Conglas and CertainTeed engaged 

in sporadic contracts for fiber glass products, which culminated 

in a letter dated May 19, 1989 from CertainTeed to Conglas, 

stating that CertainTeed would not be able to supply all of 

Conglas's needs for glass and urging Conglas to go to another 

vendor for glass. The CertainTeed letter concluded by stating: 

"Finally, Jack, I want to thank you for our business relationship 

over the past years. I plan on continuing this contact for none 

of us can foretell the future and its opportunities." After this 

arrangement was terminated, Conglas had no further business 

relationship with CertainTeed.0

 

0

Between May of 1989 and February of 1991, the record reveals no 

relationship between Conglas and CertainTeed/Vetrotex. Indeed, 

the prior relationship between the parties had ended by 1989 and 

a new relationship began in 1991 when CertainTeed/Vetrotex 
4 

 In February of 1991, CertainTeed again found itself 

with a supply of chopped strands to sell, and it communicated 

with Conglas to ascertain if Conglas would be interested in 

purchasing "44E" chopped strand. During the week of February 11, 

1991, CertainTeed met with representatives of Conglas in 

California to solicit Conglas's purchase of CertainTeed's fiber 

glass materials. On February 25, 1991, CertainTeed wrote and 

forwarded an agreement to Conglas in California. Upon receiving 

the letter, Conglas executed the agreement and returned it to 

CertainTeed's headquarters in Valley Forge, Pennsylvania (the 

"1991 Supply Agreement"). 

 In March of 1991, Vetrotex was incorporated as 

CertainTeed's wholly-owned subsidiary in charge of fiber glass 

reinforcement products operations. 

 In January of 1992, representatives of 

CertainTeed/Vetrotex flew to California and met with Conglas to 

discuss a continuation of CertainTeed's agreement to sell chopped 

strands to Conglas. At that meeting, the essential terms of a 

 

solicited business from Conglas and entered into the 1991 and 

1992 Supply Agreements. Those agreements, as discussed in text, 

were initiated by CertainTeed/Vetrotex and all the contacts with 

respect to those agreements were California contacts. 

 It was obviously for this reason that the parties joined 

issue only with respect to specific jurisdiction rather than 

general jurisdiction, the latter of which would have involved the 

various pre-1989 matters with which Judge Roth is concerned and 

which we read as the premise for the dissent. 

 In light of the new relationship initiated by Vetrotex in 

1991 and the parties' acknowledgement that Burger King's specific 

jurisdiction teachings control our disposition, we attach little 

relevance to the general jurisdictional elements emphasized by 

the dissent. General jurisdiction was not a theory urged by 

Vetrotex. 
5 

new agreement were negotiated between Conglas and 

CertainTeed/Vetrotex. Conglas did not send representatives to 

Pennsylvania to meet with Vetrotex. Conglas did, however, place 

some telephone calls to CertainTeed/Vetrotex's offices in Valley 

Forge, Pennsylvania in the course of negotiating the renewal of 

the 1991 Supply Agreement 

 On March 13, 1992, CertainTeed/Vetrotex and Conglas 

renewed the 1991 Supply Agreement (now the "1992 Supply 

Agreement"). The 1992 Supply Agreement was prepared by 

CertainTeed/Vetrotex and sent to Conglas in California, where it 

was executed. The 1992 Supply Agreement provided for a two-year 

contract period that would automatically be renewed for an 

additional one-year period commencing April 1, 1994, unless 

canceled upon sixty-days notice. 

 Under the 1992 Supply Agreement, Vetrotex agreed to 

ship fiber glass material directly from its plant in Wichita 

Falls, Texas, to Conglas's manufacturing facility in Bakersfield, 

California. Vetrotex's invoicing for the product sold under the 

1992 Supply Agreement was handled by Vetrotex's Southern 

California office, and all payments for the fiber glass material 

were sent to Vetrotex's office in Los Angeles, California. 

Conglas's primary contact at Vetrotex was Jerry Leland, a sales 

representative working out of Vetrotex's Santa Ana, California 

office. 

 In 1993, Vetrotex decided to withdraw from the fiber 

glass chopped strand business and sought to terminate its 

contract with Conglas. Vetrotex claims that it canceled the 1992 
6 

agreement by telephone on December 2, 1993, more than sixty days 

prior to the April 1, 1994 deadline. According to Conglas, it 

was only on March 23, 1994 that Vetrotex telephoned Conglas in 

California with the information that Vetrotex would not sell any 

more fiber glass chopped strand product to Conglas after March 

31, 1994. Vetrotex ceased delivery of 44E strand, and Conglas 

withheld payment on outstanding invoices. 

 On May 12, 1994, Vetrotex brought the present diversity 

action against Conglas in the Eastern District of Pennsylvania, 

seeking to recover $303,595.35 in withheld payments from Conglas. 

Shortly thereafter, Conglas sued Vetrotex in California state 

court, seeking damages for breach of the 1992 Supply Agreement. 

Vetrotex then removed the California action to the Central 

District of California, where it is currently stayed pending the 

resolution of this appeal. Vetrotex has not yet counterclaimed 

in the California action, but admitted at oral argument before us 

that there is no impediment to its filing a counterclaim in that 

action. 

 On July 5, 1994, Conglas moved to dismiss Vetrotex's 

Pennsylvania action for lack of personal jurisdiction or, 

alternatively, for improper venue. On October 18, 1994, the 

district court for the Eastern District of Pennsylvania issued a 

memorandum and order entered on October 20, 1994, dismissing 

Vetrotex's complaint without prejudice for lack of personal 

jurisdiction. 

 The district court found the relevant and dispositive 

facts, which we recite in text, infra, to be undisputed. 
7 

Accordingly, the district court concluded that Conglas's contacts 

with Pennsylvania were "marginal and were not directed at 

Pennsylvania to benefit from its laws" and held that to exercise 

jurisdiction over Conglas "would offend traditional notions of 

fair play and substantial justice." Id. Vetrotex appealed. 

II. 

A. 

 "Whether personal jurisdiction may be exercised over an 

out-of-state defendant is a question of law, and this court's 

review is therefore plenary." Mellon Bank (East) PSFS, N.A. v. 

DiVeronica Bros., Inc., 983 F.2d 551, 554 (3d Cir. 1993) (citing 

Mesalic v. Fiberfloat Corp., 897 F.2d 696, 698 (3d Cir. 1990)). 

We review any factual findings made by the district court for 

clear error. Mellon Bank (East) PSFS, Nat'l Ass'n v. Farino, 960 

F.2d 1217, 1220 (3d Cir. 1992). 

 A district court sitting in diversity applies the law 

of the forum state in determining whether personal jurisdiction 

is proper. Fed. R. Civ. P. 4(e). Pennsylvania's long-arm 

statute provides that its reach is coextensive with the limits 

placed on the states by the federal Constitution. 42 Pa. Cons. 

Stat. Ann. § 5322(b) (1981). We therefore look to federal 

constitutional doctrine to determine Conglas's susceptibility to 

personal jurisdiction in Pennsylvania. The due process clause of 

the Fourteenth Amendment places limits on the power of a state to 

assert personal jurisdiction over a nonresident defendant. 

Pennoyer v. Neff, 95 U.S. 714, 733 (1877). 
8 

 The due process limit to the exercise of personal 

jurisdiction is defined by a two-prong test. First, the 

defendant must have made constitutionally sufficient "minimum 

contacts" with the forum. Burger King Corp. v. Rudzewicz, 471 

U.S. 462, 474 (1985) (the "constitutional touchstone" of personal 

jurisdiction is "whether the defendant purposefully established 

'minimum contacts' in the forum State"). The determination of 

whether minimum contacts exist requires an examination of "the 

relationship among the forum, the defendant and the litigation," 

Shaffer v. Heitner, 433 U.S. 186, 204 (1977), in order to 

determine whether the defendant has "'purposefully directed'" its 

activities toward residents of the forum. Burger King, 471 U.S. 

at 472 (quoting Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 

774 (1984)). There must be "some act by which the defendant 

purposefully avails itself of the privilege of conducting 

activities within the forum State, thus invoking the benefits and 

protections of its laws." Hanson v. Denckla, 357 U.S. 235, 253 

(1958). Second, if "minimum contacts" are shown, jurisdiction 

may be exercised where the court determines, in its discretion, 

that to do so would comport with "traditional notions of fair 

play and substantial justice." International Shoe Co. v. 

Washington, 326 U.S. 310 (1945); Farino, 960 F.2d at 1222. 
9 

B. 

 Vetrotex alleged that the district court had specific 

jurisdiction over Conglas. "Specific jurisdiction is invoked 

when the cause of action arises from the defendant's forum 

related activities," North Penn Gas Co. v. Corning Natural Gas 

Corp., 897 F.2d 687, 690 (3d Cir. 1990), cert. denied, 498 U.S. 

847 (1990); see Helicopteros Nacionales de Colombia v. Hall, 466 

U.S. 408, 414 n.8 (1984); Dollar Sav. Bank v. First Sec. Bank of 

Utah, N.A., 746 F.2d 208, 211 (3d Cir. 1984), such that the 

defendant "should reasonably anticipate being haled into court 

there." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 

297 (1980). Vetrotex does not allege general jurisdiction.0

 As is evident from the complaint, this action concerns 

only Conglas's alleged breach of the 1992 Supply Agreement. The 

1992 Supply Agreement, standing alone, is an insufficient ground 

upon which to exercise specific personal jurisdiction over 

Conglas. See Grand Entertainment Group, Ltd. v. Star Media 

Sales, Inc., 988 F.2d 476, 482 (3d Cir. 1993) ("[A] contract 

alone does not 'automatically establish sufficient minimum 

contacts in the other party's home forum.'") (quoting Burger 

King, 471 U.S. at 478); Mellon Bank (East) v. DiVeronica Bros., 

 

0

"General jurisdiction is invoked when the plaintiff's cause of 

action arises from the defendant's non-forum related activities." 

North Penn Gas Co. v. Corning Natural Gas Corp., 897 F.2d 687, 

690 n.2 (3d Cir. 1990). To establish general jurisdiction, the 

plaintiff must show that the defendant has maintained "continuous 

and systematic" contacts with the forum. See Helicopteros 

Nacionales de Colombia v. Hall, 466 U.S. 408, 414 n.9 & 416 

(1984); Burger King Corp. v. Rudzewicz, 471 U.S. 462, 473 n.15 

(1985). 
10 

Inc., 983 F.2d 551, 557 (3d Cir. 1993) ("Contracting with a 

resident of the forum state does not alone justify the exercise 

of personal jurisdiction over a non-resident defendant.") (citing 

Mellon Bank (East) PSFS, Nat'l Ass'n v. Farino, 960 F.2d 1217, 

1222 (3d Cir. 1992)). 

 In determining whether specific jurisdiction exists, 

however, we consider not only the contract but also "prior 

negotiations and contemplated future consequences, along with the 

terms of the contract and the parties' actual course of dealing." 

Burger King, 471 U.S. at 479. 

III. 

A. 

 The facts underlying the present case are not in 

dispute. Vetrotex solicited Conglas to obtain the 1991 Supply 

Agreement by telephone and by personal visits to Conglas 

headquarters in California.

0

 Conglas did not solicit the 1991 

Supply Agreement, and no Conglas personnel ever visited 

Pennsylvania. Conglas signed the 1991 Supply Agreement in

California and sent it to CertainTeed in Pennsylvania. Similarly, 

with respect to the 1992 Supply Agreement, officers of 

CertainTeed flew to California to negotiate that contract. The 

1992 Supply Agreement was prepared by CertainTeed and sent to 

Conglas in California, where it was executed. No product was 

 

0

Even though the complaint does not mention the 1991 Supply 

Agreement, we find it to be relevant as a "prior negotiation" to 

the 1992 Supply Agreement, which had renewed the 1991 Supply 

Agreement. 
11 

shipped from, through, or to Pennsylvania. Instead, the chopped 

strand was manufactured in Texas and shipped directly from 

Vetrotex's plant in Texas to Conglas's facility in California. 

Vetrotex handled all of the transportation arrangements and paid 

the transportation costs. Vetrotex's invoicing for product sold 

under the 1992 Supply Agreement was handled by Vetrotex's 

California office. Conglas made all payments for goods to 

Vetrotex's California office. 

 The district court found, among other things that the 

following facts were not in dispute: 

Vetrotex solicited Conglas to obtain the 

1991-92 contract by telephone and by personal 

visits to Conglas headquarters in California. 

The parties engaged in telephone 

communication prior to entering into the 

1991-92 contract. Conglas signed the 

disputed contract in California and sent it 

to Vetrotex in Pennsylvania. Conglas made 

all payments for goods to Vetrotex 

CertainTeed's California office. Under the 

disputed contract, Vetrotex did not deliver 

any goods to Conglas in Pennsylvania. 

(Memorandum and Order entered October 20, 1994 at 4). 

Understandably, Vetrotex agreed at oral argument that none of 

these findings of fact are clearly erroneous. See North Penn Gas 

v. Corning Natural Gas, 897 F.2d 687, 688 (3d Cir. 1990) ("A 

determination of minimum contacts is based upon findings of fact. 

As such, the district court's factual findings will not be 

disturbed unless clearly erroneous."). The district court also 

found that Vetrotex "has not shown solicitation, advertisement, 

or delivery by Conglas in Pennsylvania since 1989." Id. at 3. 
12 

 The only contacts that Conglas had with Pennsylvania 

consisted of some telephone calls and letters written to Vetrotex 

in Pennsylvania. However, this Court has recognized that 

"informational communications in furtherance of [a contract 

between a resident and a nonresident] does not establish the 

purposeful activity necessary for a valid assertion of personal 

jurisdiction over [the nonresident defendant]." Sunbelt Corp. v. 

Noble, Denton & Assoc., Inc., 5 F.3d 28, 32 (3d Cir. 1993) 

(citing Stuart v. Spademann, 772 F.2d 1185, 1193 (5th Cir. 1985) 

(stating that "an exchange of communications between a resident 

and a nonresident in developing a contract is insufficient of 

itself to be characterized as purposeful activity invoking the 

benefits and protection of the forum state's laws")). 

 Thus, in the present case, Conglas was merely a 

"passive buyer" of Vetrotex's product.0 We hold that the 

undisputed circumstances attending Conglas's 1991 and 1992 Supply 

Agreements with Vetrotex do not support the conclusion that 

Conglas "purposefully availed" itself of the privilege of doing 

business in Pennsylvania for purposes of the district court's 

 

0

The Eighth Circuit has recognized that "reaching out" is 

particularly difficult to find where the nonresident defendant is 

a buyer, rather than a seller, of the resident plaintiff's 

products. See Bell Paper Box, Inc. v. Trans Western Polymers, 

Inc., 53 F.3d 920, 922 (8th Cir. 1995). This distinction is even 

more telling when the defendant is a "passive" buyer, i.e. one 

which has been solicited as a customer of the plaintiff. See

Stewart, A New Litany of Personal Jurisdiction, 60 U. Colo. L. 

Rev. 5, 45-46 (1989). The First Circuit, for instance, requires 

a showing that the defendant's forum-related activities in 

contract cases were "instrumental in the formation of the 

contract." United Elec. Workers v. 163 Pleasant St. Corp., 960 

F.2d 1080, 1089 (1st Cir. 1992). 
13 

exercise of personal jurisdiction over Conglas. See Sunbelt 

Corp., 5 F.3d at 32 (holding that a Pennsylvania corporation's 

contract with a Texas corporation and post-contract telephone and 

facsimile communications with the same were insufficient to show 

"purposeful availment" of the privilege of doing business in 

Texas, for purposes of the Texas long-arm statute, the latter of 

which is co-extensive with the reach of the federal 

constitution).0

 The instant case is distinguishable from other cases 

where jurisdiction over a nonresident defendant has been premised 

largely on the defendant's contract with a resident of the forum 

state. For instance, this is not a case where the defendant 

solicited the contract or initiated the business relationship 

leading up to the contract. Compare Mellon Bank (East) PSFS, 

Nat'l Ass'n v. Farino, 960 F.2d 1217 (3d Cir. 1992). Nor is this 

a case where the defendant sent any payments to the plaintiff in 

the forum state, compare North Penn Gas v. Corning Natural Gas, 

897 F.2d 687, 690-91 (3d Cir. 1990), or where the defendant 

engaged in extensive post-sale contacts with the plaintiff in the 

forum state. Compare Mesalic v. Fiberfloat Corp., 897 F.2d 696, 

700 (3d Cir. 1990) (after selling a boat to New Jersey buyer, 

 

0

Vetrotex also argues that the fact that the invoices as distinct 

from the general Supply Agreements, provided as a term and 

condition, that they (the invoices) were to be governed by and 

should be construed in accordance with Pennsylvania law, is 

relevant to personal jurisdiction over this case. We disagree. 

The choice of law provisions pertain only to the individual sales 

contracts for each shipment of fiber glass chopped strand, and we 

do not find them relevant to our jurisdictional analysis of the 

underlying Supply Agreements. 
14 

defendant sent written correspondence to the buyer's New Jersey 

residence, delivered the boat to New Jersey, and attempted to 

repair the boat in New Jersey). 

B. 

 Vetrotex argues that the relationship that existed 

between Conglas and CertainTeed in the 1980s are also relevant as 

"prior negotiations" or "course of dealing" with respect to the 

1992 Supply Contract under Burger King. Burger King's reference 

to "prior negotiations," "future consequences," "terms of the 

contract," and "course of dealing," however, clearly contemplates 

dealings between the parties in regard to the disputed contract, 

not dealings unrelated to the cause of action. In Burger King, 

the Court found specific jurisdiction over a Michigan franchisee, 

Rudzewicz, in the franchisor Burger King's home state, Florida, 

where "Rudzewicz deliberately reached out beyond Michigan and 

negotiated with a Florida corporation," id. at 479-80, to enter 

into a "carefully structured 20-year relationship that envisioned 

continuing and wide-reaching contacts." Id. at 480. 

 In the present case, the negotiations that occurred 

between Vetrotex and CertainTeed in the 1980s are unrelated to 

the 1992 Supply Contract and are not relevant to specific 

jurisdiction.0 See International Shoe, 326 U.S. at 319 (the 

cause of action must "arise[] out of" or "relate[] to" the 

defendant's contacts with the forum); Helicopteros, 466 U.S. at 

414 n.8; Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 

 

0

As earlier noted in text, Vetrotex has argued this appeal only 

on the issue of specific, and not general, jurisdiction. 
15 

(1985); C.L. Grimes v. Vitalink Communications Corp., 17 F.3d 

1553, 1559 (3d Cir.), cert. denied, 115 S. Ct. 480 (1994); Dollar 

Sav. Bank v. First Sec. Bank of Utah, N.A., 746 F.2d 208, 211 (3d 

Cir. 1984). 

 Vetrotex would characterize the "thirteen-month hiatus" 

in the parties' dealings from 1989 to 1991 as a mere interruption 

in an ongoing course of dealing. The district court did not 

agree, nor do we. The relationship between the parties in which 

CertainTeed supplied Conglas with fiber glass chopped strands was 

terminated by CertainTeed's letter of May 19, 1989, which urged 

Conglas to look elsewhere for suppliers. The 1991 Supply 

Agreement (renewed by the 1992 Supply Agreement at issue here) 

began a new relationship between the parties, separate and apart 

from the prior relationship. There is no evidence in the record 

that the parties understood the 1991 and 1992 Supply Contracts to 

be merely a continuation of the relationship that the parties had 

in the 1980s.0

 Conglas has not "purposefully availed itself" of the 

privilege of doing business in Pennsylvania for purposes of 

establishing the "minimum contacts" required for specific 

jurisdiction. Nor has Vetrotex established "minimum contacts" on 

any other grounds between Conglas and Pennsylvania for purposes 

 

0

Thus, we find Associated Business Telephone Systems Corp. v. 

Greater Capital Corp., 861 F.2d 793, 797 (3d Cir. 1988), to be 

distinguishable. In that case, we held that a district court in 

New Jersey had specific jurisdiction over a California 

corporation that had entered into a contract with a New Jersey 

corporation. However, the contract there provided for a ten-year 

life and created continuing obligations between the two 

companies. 
16 

of specific jurisdiction.0 Accordingly, we hold that the 

assertion of jurisdiction over Conglas would violate the 

fundamental dictates of due process. 

IV. 

 We will affirm the district court's dismissal of 

Vetrotex's complaint for lack of personal jurisdiction. 

 

0

Because we have concluded that Vetrotex has not made the 

threshold showing of sufficient minimum contacts with 

Pennsylvania to warrant the exercise of personal jurisdiction 

over Conglas, we need not address the secondary issue of whether 

exercising jurisdiction would comport with fair play and 

substantial justice. See Bell Paper Box, Inc. v. Trans Western 

Polymers, Inc., 53 F.3d 920, 921 (8th Cir. 1995) ("Due process 

requires both minimum contacts with the forum state and accord 

with the notions of 'fair play and substantial justice.'") 

(emphasis added) (quoting Burger King Corp. v. Rudzewicz, 471 

U.S. 462, 474 (1985)). 
17 

Vetrotex CertainTeed Corporation v. Consolidated

Fiber Glass Products Company

No. 94-2058 

_________________________________________________ 

ROTH, Circuit Judge, Dissenting: 

 As I read the Supreme Court's decision in Burger King 

Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985), a court determining 

whether specific personal jurisdiction lies must consider prior 

business dealings between the parties. The majority opinion in 

this case, however, plays down the importance of a long business 

relationship established between Conglas and CertainTeed/Vetrotex 

during the 1980s. The majority focuses only on the final 1992 

Supply Contract, see Majority Op. at ___ (slip op. at 14), 

despite the fact that the 1992 contract grew out of and was 

founded upon a thirteen-year-old working relationship. 

 I believe that the majority's narrow focus on the 1992 

contract misinterprets the Supreme Court's rule in Burger King by 

refusing to consider the entire "course of dealings" between the 

relevant parties. The negotiations and dealings during the 1980s 

are, in my opinion, both relevant and related to the present 

cause of action. Because I would find that Conglas purposefully 

availed itself of the privilege of conducting business within 

Pennsylvania by virtue of its longstanding business relationship 

with Vetrotex, I write in dissent. 

I. 
18 

 In its discussion of the facts, the majority opinion 

emphasizes the 1991 and 1992 Supply Contracts and minimizes a 

significant course of dealings that occurred between the parties 

during the 1980s. These dealings affected the negotiation of the 

1992 Supply Agreement and should not have been dismissed by the 

court as irrelevant. The omitted facts demonstrate that Conglas 

initiated and pursued a contractual relationship with CertainTeed 

at its Pennsylvania office and made sufficient voluntary contacts 

with Pennsylvania such that it should have "reasonably 

anticipate[d] being haled into court there." World-Wide 

Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980). 

 On April 30, 1980, Conglas sent CertainTeed a new 

product announcement for Conmat-90, a fiber glass roofing mat, 

expressly soliciting orders for the new product. In July 1981, 

Conglas representative Tom Pessel followed up on Conglas's April 

1980 solicitation letter by visiting CertainTeed's Blue Bell, 

Pennsylvania office to discuss CertainTeed's requirements for 

fiber glass mat and Conglas's ability to satisfy those 

requirements. Following additional correspondence between 

Conglas and CertainTeed's Pennsylvania offices, CertainTeed 

placed an order for Conglas mats in November 1981. 

 In early 1982, Conglas and CertainTeed negotiated a 

formal agreement pursuant to which Conglas agreed to sell fiber 

glass mat to CertainTeed for the twelve-month period from 

February 1, 1982 through January 31, 1983. After the execution 

of the 1982 agreement, Conglas and CertainTeed began a 

collaborative effort to resolve quality control issues raised by 
19 

CertainTeed's testing of Conglas's fiber glass mats. This 

process resulted in regular communication between Conglas and 

CertainTeed personnel located in Pennsylvania, as well as a 

number of visits by Conglas representatives to the CertainTeed 

facility located in Blue Bell, Pennsylvania. 

 Conglas and CertainTeed entered into sales agreements 

similar to the 1982 agreement in February 1983 and May 1984. 

Despite these successive agreements, the Conglas mats failed to 

qualify for use in CertainTeed's roofing shingles. For this 

reason, CertainTeed terminated the 1984 agreement. Conglas later 

contacted CertainTeed in 1986 and 1989 regarding the sale to 

CertainTeed of fiber glass mats, but no further agreements were 

reached. 

 In addition to this business relationship involving the 

sale of Conglas fiber glass mats to CertainTeed, the parties also 

entered into a business relationship in which CertainTeed sold 

chopped fiber glass strands to Conglas. Although the record is 

devoid of any written agreements documenting sales of chopped 

strands to Conglas during the 1980s, CertainTeed did produce 

correspondence between the parties pertaining to such activities. 

Correspondence in the record indicates that in 1987 and 1988 

CertainTeed provided Conglas with a certain volume of chopped 

strands each month. On December 8, 1987, representatives of 

Conglas visited CertainTeed in Valley Forge, Pennsylvania. Among 

the topics discussed was CertainTeed's supply to Conglas of 

chopped strands. 
20 

 CertainTeed's sale of chopped strands to Conglas was 

interrupted, apparently at the end of 1989, when CertainTeed was 

unable to meet Conglas's needs due to supply shortages. In 

February 1991, however, CertainTeed again found itself with 

chopped strands to sell. CertainTeed and Conglas entered into 

negotiations regarding the terms of a sales agreement. David 

Sharpe, a Vice President at CertainTeed, participated in these 

negotiations from his office in Valley Forge, Pennsylvania, and 

he forwarded a letter agreement (the "1991 Supply Contract") to 

Conglas in California from Pennsylvania. The 1991 Supply 

Contract is on CertainTeed letterhead with its Pennsylvania 

headquarters address prominently displayed. Upon receiving the 

1991 Supply Contract, a Conglas representative executed the 

agreement and returned it to CertainTeed's Pennsylvania 

headquarters. 

 On March 13, 1992, in anticipation of the expiration of 

the 1991 Supply Contract, the parties entered into another 

agreement (the "1992 Supply Contract"). By this time 

CertainTeed's subsidiary, Vetrotex, had been incorporated. 

Pursuant to the 1992 Supply Contract, Vetrotex agreed to continue 

selling chopped fiber glass strands to Conglas. As noted in the 

majority opinion, Dick Sharpe received several telephone calls 

from Conglas at his Valley Forge, Pennsylvania, office in 

negotiating the terms of the 1992 Supply Contract. Like the 1991 

Supply Contract, the 1992 Supply Contract is printed on 

Vetrotex/CertainTeed letterhead, displaying the company's 

Pennsylvania address. 
21 

II. 

A. 

 Because this case involves a contract between 

interstate parties, the Supreme Court's opinion in Burger King is 

the analytical keystone. See Mellon Bank (East) PSFS, N.A. v. 

Farino, 960 F.2d 1217, 1222 (3d Cir. 1992). In upholding the 

district court's exercise of specific personal jurisdiction in 

Burger King, the Supreme Court noted that the minimum contacts 

inquiry is a "fair warning" requirement of due process, which is 

satisfied "if the defendant has 'purposefully directed' his 

activities at residents of the forum, and litigation results from 

alleged injuries that 'arise out of or relate to' those 

activities." Burger King, 471 U.S. at 472 (citations omitted). 

The Court explained: 

[W]ith respect to interstate contractual obligations, 

we have emphasized that parties who "reach out beyond 

one state and create continuing obligations with 

citizens of another state" are subject to regulation 

and sanctions in the other State for the consequences 

of their activities. . .. [W]here individuals 

"purposely derive benefit" from their interstate 

activities, it may well be unfair to allow them to 

escape having to account in other States for 

consequences that arise proximately from such 

activities . . .. 

Id. at 473-74 (citations omitted). Thus, under Burger King, 

parties taking the affirmative step of negotiating and entering 

into interstate contractual obligations will likely subject 

themselves to specific personal jurisdiction in the other state. 

The Court warned, however, that "an individual's contract with an 

out-of-state party alone [cannot] automatically establish 
22 

sufficient minimum contacts in the other party's home forum." Id.

at 478 (emphasis in original). Such a mechanical test has been 

explicitly rejected. 

 Instead, when deciding the question of specific 

personal jurisdiction, the Supreme Court favors a "highly 

realistic" approach that takes into account factors such as 

"prior negotiations and contemplated future consequences," and 

"the terms of the contract and the parties' actual course of 

dealing." Id. at 479. The reality of the situation in this case 

is that CertainTeed/Vetrotex and Conglas were involved in a 

business relationship spanning more than ten years. Over those 

years, Conglas affirmatively solicited business with CertainTeed, 

repeatedly made phone calls to Pennsylvania, sent employees to 

visit CertainTeed's facilities in Pennsylvania, and mailed 

contracts to Pennsylvania to be signed. Additionally, Conglas 

deliberately involved itself in several contractual obligations 

with CertainTeed/Vetrotex, fully aware that these corporations 

were headquartered in Pennsylvania. Thus, the facts in the 

instant case reveal that Conglas is not being brought into 

Pennsylvania solely as a result of "random," "fortuitous," or 

"attenuated" contacts, nor as a result of the "unilateral 

activity of another party or third person." Id. at 475 

(citations omitted). Rather, Conglas has knowingly and 

deliberately engaged in a pattern of contacts with Pennsylvania 

such that Conglas should have expected that it could be subject 

to litigation there. 

III. 
23 

 Until now, the question whether two parties' prior 

business relationships should be taken into account in 

determining the existence of specific personal jurisdiction has 

not been addressed by this court. As in all issues of personal 

jurisdiction, however, this question cannot be answered 

mechanically. Instead, each case must be individually evaluated 

in full to determine whether the parties' "actual course of 

dealing" is such that the nonresident party was effectively on 

notice that it might be haled into court in the other party's 

home forum. In the instant case, it is clear that Conglas, 

through its long history of dealing with CertainTeed and its 

subsidiary Vetrotex, engaged in repeated contacts with 

representatives and facilities located in Pennsylvania. By 

virtue of these extensive contacts, Conglas was on notice that it 

could be subject to litigation in Pennsylvania. Thus, the 

longstanding relationship between these parties is relevant and 

should have been taken into account in determining whether 

Conglas established sufficient minimum contacts in Pennsylvania. 

See, e.g., Reynolds Metals Co. v. FMALI, Inc., 862 F. Supp. 1496, 

1498-99 (E.D. Va. 1994) (taking parties' continuing relationship 

into consideration in finding that specific personal jurisdiction 

was proper). 

 Accordingly, I dissent. I believe that, based on the 

entire course of dealings between the parties, Conglas had 

minimum contacts in Pennsylvania sufficient to allow the district 

court to exercise personal jurisdiction over Conglas. I would 

therefore reverse the district court's order dismissing 
24 

Vetrotex's complaint and remand this case to the district court 

for further proceedings.