# Opinion

> District Court, E.D. Pennsylvania · August 21, 2026

URL: https://www.frixlaw.com/law-library/cases/11423782

## Case

- **Full name:** Freight Innovation LLC v. Fellowship Warehousing & Logistics LLC, et al.
- **Court:** District Court, E.D. Pennsylvania
- **Decided:** August 21, 2026
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

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## Opinion text

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA

FREIGHT INNOVATION LLC, : CIVIL ACTION
Plaintiff, :
:
v. : No. 25-2559
:
FELLOWSHIP WAREHOUSING & :
LOGISTICS LLC, et al., :
Defendants. :

MEMORANDUM
KENNEY, J. AUGUST 21, 2026
Before the Court are various Motions to Dismiss filed by Defendants Chaim Gross, Shani
Gross, FoamTex LLC (“FoamTex”), SmartShip Network LLC (“SmartShipped”), Samuel
Greenwald, Yaakov Landsman, and Simcha Newmark. See ECF Nos. 109, 110, 111, 115, 132.
Plaintiff opposes dismissal as to each Defendant. See ECF Nos. 123, 136, 145. For the reasons
set forth below, the Court decides the Motions as follows. The Court will GRANT Chaim Gross’,
Shani Gross’, FoamTex’s, and Simcha Newmark’s Motions to Dismiss for lack of personal
jurisdiction (ECF Nos. 109, 110, 111, 132), and will DISMISS all claims asserted against them
WITHOUT PREJUDICE to Plaintiff refiling those claims in a court that can exercise personal
jurisdiction over them. The Court will GRANT SmartShipped’s, Samuel Greenwald’s, and
Yaakov Landsman’s Motion to Dismiss for failure to state a claim (ECF No. 115), and DISMISS
the claims asserted against them in the First Amended Complaint (“FAC”): Count III is
DISMISSED WITHOUT PREJUDICE against Samuel Greenwald and Yaakov Landsman in
light of Plaintiff’s voluntary withdrawal of the claim; Count III is DISMISSED WITH
PREJUDICE against SmartShipped; and Count IV is DISMISSED WITH PREJUDICE against
SmartShipped, Samuel Greenwald, and Yaakov Landsman. Finally, the Court will deny leave to
amend as futile.
I. BACKGROUND
A. Factual Background

1. The Shipping Services Agreement
Plaintiff Freight Innovation LLC is “a freight and shipping transport company” that
provides “shipping services to clients in order to streamline the time and costs associated with their
freight shipments.” ECF No. 78 ¶ 1. In June 2023, Plaintiff agreed to provide shipping services
to Defendants FellowShip Warehousing & Logistics LLC (“FellowShip”) and Milliard Enterprises
LLC d/b/a Milliard Brands (“Milliard Enterprises”) for a period of two years. Id. ¶¶ 20, 23. The
terms and scope of the parties’ contractual relationship were set out in a Contract Optimization
Agreement (the “Agreement”). Id. ¶ 20.1 On June 27, 2023, Jack Kressner, Director of Business
Development, signed the Agreement as the “‘authorized representative’ on behalf of the ‘Client,’”
which was defined as “‘FellowShip/Milliard.’” Id. ¶¶ 21, 25 (citation omitted). On June 29, 2023,

Plaintiff’s CEO, Stephen Nadel, countersigned the Agreement. Id. ¶ 25. The Agreement contained
a Pennsylvania forum selection clause and further provided that it is “governed by the laws of the
Commonwealth of Pennsylvania[,]” except for its choice of law rules. Id. ¶ 14; see also ECF No.
69-7 § 12.

1 The Agreement was filed as part of the summary judgment record. See ECF No. 69-7. Since
Plaintiff quotes from and cites to portions of the Agreement in its FAC, see, e.g., ECF No. 78 ¶¶
21–25, the Court finds that the Agreement is incorporated into the FAC by reference. See OFI
Asset Mgmt. v. Cooper Tire & Rubber, 834 F.3d 481, 490 (3d Cir. 2016) (explaining that courts
may consider “documents incorporated into the complaint by reference” when deciding a Rule
12(b)(6) motion to dismiss (internal quotations and citation omitted)).
Under the terms of the Agreement, Defendants FellowShip and Milliard Enterprises
“engaged Plaintiff as their exclusive third-party consultant partner for parcel transportation
services” and “agreed to pay Plaintiff 50% of their realized savings” from shipping costs “[i]n
exchange for [Plaintiff’s] services.” ECF No. 78 ¶¶ 20, 24 (emphasis omitted). In order to

calculate realized savings, the Agreement provided that “Plaintiff would obtain shipment
information directly from the carrier(s), or that Defendants would provide to Plaintiff ‘on a
monthly basis, all carrier invoices covered by this Agreement.’” Id. ¶ 24 (quoting ECF No. 69-7
§ 4(b)). Moreover, during the two-year period of the Agreement, FellowShip and Milliard
Enterprises agreed not to use “‘other 3rd party UPS or FedEx accounts’” and agreed that they
“‘would not simultaneously utilize or engage in a direct relationship with the same carrier offered
by [Plaintiff] (example: UPS via FI and UPS direct) without prior consent.’” Id. ¶ 22 (quoting
ECF No. 69-7 §§ 8, 16).
After executing the Agreement in June 2023, Milliard Enterprises provided Plaintiff with
“copies of its existing FedEx agreements to review and advise upon, which were in the name of

‘Milliard Brands.’” Id. ¶ 26. Defendant Samuel Greenwald, who was a “director” at Milliard
Enterprises, “sent Plaintiff payment information.” Id.; see also id. ¶ 68. Plaintiff provided its
services in turn to FellowShip and Milliard Enterprises “in accordance with the Agreement,”
including providing them with access to Plaintiff’s “valuable, proprietary rate information.” Id. ¶
27.
Over the course of “about two months, Plaintiff was paid a total of approximately $25,000”
in exchange for its services. Id. ¶ 29. “The funds were paid by ‘Milliard Brands.’” Id. But
sometime after this initial payment, FellowShip and Milliard Enterprises “abruptly stopped
responding to Plaintiff’s communications” and “stopped making payments.” Id. ¶¶ 29–30; see
also id. ¶ 32. FellowShip and Milliard Enterprises then allegedly “failed to provide access to their
shipping information or copies of their monthly shipping invoices, as required” by the terms of the
Agreement. Id. ¶ 30. FellowShip and Milliard Enterprises also “started using another UPS
provider, hired other third-party consultants, and signed a deal with FedEx directly, cutting out

Plaintiff.” Id. ¶ 31. Plaintiff alleged that these actions constituted “blatant violations of the
exclusivity provisions of the Agreement.” Id.
On April 30, 2024, Plaintiff’s counsel wrote a letter to Defendant Chaim Gross, the
majority owner of both FellowShip and Milliard Enterprises, reminding FellowShip and Milliard
Enterprises of their contractual obligation to provide Plaintiff with “(i) their contracts with FedEx
and UPS, or (ii) copies of their other carrier and third-party contracts or proposals received from
June 29, 2023 to the present.” Id. ¶ 33. Neither Chaim Gross nor any of the other Defendants
responded. Id.
2. Other “Affiliated” Corporate Entities
Based on representations made by FellowShip’s and Milliard Enterprises’ former counsel

in this litigation, “Plaintiff initially believed . . . that the ‘Milliard’ party it had been dealing with
was Defendant Milliard Enterprises LLC.” Id. ¶ 37. However, when Plaintiff deposed Chaim
Gross “in this action on March 20, 2026, he revealed for the first time” that Lakewood Candies
LLC d/b/a Milliard Brands (“Lakewood Candies”)—another entity that he owns—“was the
‘Milliard Brands’ with which Plaintiff had been dealing.” Id. In addition to FellowShip, Milliard
Enterprises, and Lakewood Candies, Chaim Gross has a majority ownership interest in Defendant
FoamTex. Id. ¶ 38(a)–(d). Defendant Simcha Newmark has a minority ownership interest in
FoamTex. Id. ¶ 38(c).
According to Plaintiff, Milliard Enterprises, Lakewood Candies, and FoamTex have all
used “deceptively similar business names[,]” “sold the same products[,]” and have been “used
interchangeably . . . while projecting the image of being a singular business called ‘Milliard’ or
‘Milliard Brands.’” Id. ¶¶ 40, 49; see also id. ¶¶ 41–42. For example, “[r]epresentatives of

Milliard [Enterprises], Lakewood Candies, and FoamTex held themselves out as representing
‘Milliard’ or ‘Milliard Brands,’ and used milliardbrands.com email addresses when
communicating with third parties.” Id. ¶ 43; see also id. ¶¶ 44–46 (alleging that Milliard
Enterprises, Lakewood Candies, and FoamTex have all used “the same shared website,” sold the
same types of products “all under the same ‘Milliard’ name and logo[,]” and “used the same
Amazon storefronts to market and sell their products online”); id. ¶ 50 (“FellowShip, Milliard
[Enterprises], Lakewood Candies, and FoamTex have used the same set of shipping accounts and
subaccounts held in the name of ‘Milliard Brands,’ ‘Milliard,’ or variations thereof, to ship their
parcels”). FellowShip, Milliard Enterprises, Lakewood Candies, and FoamTex also allegedly
regularly enter into contracts under “the name ‘Milliard Brands’ or ‘Milliard,’ without specifying

the specific corporate entity that is the contracting party.” Id. ¶ 47.
During his March 2026 deposition, Chaim Gross further represented that FellowShip and
Milliard Enterprises have now “gone out of business,” and that Lakewood Candies is currently
“winding down its business.” Id. ¶ 59. According to Plaintiff, “Defendants have methodically
moved the business, assets, and employees of FellowShip, Milliard [Enterprises], and Lakewood
Candies over to new corporate entities.” Id. ¶ 60. One of those new entities is FoamTex, which
allegedly is operating “under the ‘Milliard Brands’ name” and is “selling the same exact products
that were formerly sold by Milliard [Enterprises] and Lakewood Candies.” Id. ¶ 61. As to
FellowShip, Plaintiff alleged that FellowShip “rebranded and continued to operate the same
business under a new name, SmartShipped.” Id. ¶ 63. Defendant SmartShip Network LLC—i.e.,
SmartShipped—has two members, Defendants Yaakov Landsman and Samuel Greenwald, and
“was formed on or about March 10, 2025.” Id. ¶ 64. Both Landsman and Greenwald were former
employees of Milliard Enterprises and/or Lakewood Candies. Id. ¶¶ 67–68.

B. Procedural History
As the parties are all too familiar, this case has a somewhat lengthy and contorted
procedural history, and the instant Motions to Dismiss arise by means of an unusual posture.
Plaintiff originally initiated this action against Defendants FellowShip and Milliard Enterprises in
California state court on October 11, 2024 (the “California Action”). Id. ¶ 35. After litigating the
case in California for several months, on April 25, 2025, Plaintiff, FellowShip, and Milliard
Enterprises entered into a stipulation, in which the parties agreed that Plaintiff’s claims in the
California Action would be dismissed and refiled in a new action in the Eastern District of
Pennsylvania due to a forum selection clause in the parties’ Agreement. Id. ¶ 36. FellowShip and
Milliard Enterprises thereby agreed to submit to the jurisdiction and venue of this Court. Id.

On May 20, 2025, Plaintiff refiled its action in the Eastern District of Pennsylvania. See
ECF No. 1. Rather than moving to dismiss, on September 10, 2025, FellowShip and Milliard
Enterprises filed their answers to the original Complaint. See ECF Nos. 19, 20. Thereafter, the
parties proceeded to discovery, engaged in several months of written discovery, and took
depositions. At one point, a motion to compel was filed and resolved. See ECF Nos. 39, 49. In
addition, in the midst of discovery, FellowShip and Milliard Enterprises changed counsel, which
necessitated an extension of the parties’ case deadlines. See ECF Nos. 46, 51–52, 58–60.
After the close of discovery, Plaintiff filed a Motion for Partial Summary Judgment, and
FellowShip and Milliard Enterprises filed a Motion for Summary Judgment. See ECF Nos. 69,
71. Based on the arguments and factual representations that FellowShip and Milliard Enterprises
made in their Motion for Summary Judgment, it became clear to the Court that Lakewood
Candies—which was a non-party at the time—played a central role in the parties’ dispute and
appeared to be a party in interest. See ECF No. 76 at 1 n.1. Moreover, there appeared to be factual

information that should have been revealed to Plaintiff earlier during fact discovery, which was
instead withheld or misrepresented. See id. The Court thus denied without prejudice the parties’
Motions for Summary Judgment and granted Plaintiff leave to amend its Complaint, as Plaintiff
had previously represented that it wanted to seek leave to amend. See ECF Nos. 76–77; see also
ECF No. 62 at 4–7.
On May 11, 2026, Plaintiff filed its FAC. See ECF No. 78. Plaintiff named nine new
Defendants, in addition to Does 1–10, and asserted four causes of action. See id. ¶¶ 76–106. First,
Plaintiff asserted a claim for breach of contract against Defendants FellowShip, Milliard
Enterprises, Lakewood Candies, FoamTex, and Chaim Gross. Id. ¶¶ 76–89. As part of this claim,
Plaintiff alleged that Defendants Lakewood Candies, FoamTex, and Chaim Gross are liable for the

actions of Defendants FellowShip and Milliard Enterprises under a theory of single enterprise
liability. Id. ¶¶ 85–89. Second, in the alternative to its breach of contract claim, Plaintiff asserted
a claim for unjust enrichment against Defendants FellowShip, Milliard Enterprises, Lakewood
Candies, and FoamTex. Id. ¶¶ 90–95. Third, Plaintiff asserted a claim for a violation of the
Pennsylvania Uniform Voidable Transactions Act (“PUVTA”) against all Defendants. Id. ¶¶ 96–
102. Fourth, Plaintiff asserted a claim for aiding and abetting against all Defendants. Id. ¶¶ 103–
06. Plaintiff seeks damages, specific performance of the Agreement, a declaration that certain
transfers of assets between Defendants are void, and an injunction enjoining Defendants from
certain future asset transfers, among other relief. See id. at 16–17 (Prayer for Relief).
After the FAC was filed, Defendants FellowShip, Milliard Enterprises, and Lakewood
Candies filed a joint Motion to Dismiss, which the Court granted in part and denied in part. See
ECF Nos. 85, 94, 101. At present, there are five pending Motions to Dismiss before the Court that
were filed over the course of June and July 2026:

• Chaim Gross moved to dismiss all claims asserted against him for lack of personal
jurisdiction under Rule 12(b)(2), for improper venue under Rule 12(b)(3), and for
failure to state a claim under Rule 12(b)(6). See ECF No. 109-1 at 7.
• Shani Gross moved to dismiss all claims asserted against her for lack of personal
jurisdiction under Rule 12(b)(2), for improper venue under Rule 12(b)(3), and for
failure to state a claim under Rule 12(b)(6). See ECF No. 110-1 at 6.
• FoamTex moved to dismiss all claims asserted against it for lack of personal
jurisdiction under Rule 12(b)(2), for improper venue under Rule 12(b)(3), and for
failure to state a claim under Rule 12(b)(6). See ECF No. 111-1 at 7.
• SmartShipped, Samuel Greenwald, and Yaakov Landsman moved to dismiss all claims
asserted against them for failure to state a claim under Rule 12(b)(6). See ECF No.
115-1 at 6.
• Simcha Newmark moved to dismiss all claims asserted against him for lack of personal
jurisdiction under Rule 12(b)(2), for improper venue under Rule 12(b)(3), for
insufficiency of service of process under Rule 12(b)(5), and for failure to state a claim
under Rule 12(b)(6). See ECF No. 132-1 at 6.

Due to the unusual posture that the Motions to Dismiss were filed in, the Court notes that a
significant amount of discovery has already occurred in this case and a fuller record was available
to Plaintiff when amending its Complaint.
On June 26, 2026, Plaintiff filed a Consolidated Opposition to the Motions to Dismiss filed
by Chaim Gross, Shani Gross, and FoamTex. See ECF No. 123. In addition, Plaintiff filed an
Opposition to SmartShipped’s, Samuel Greenwald’s, and Yaakov Landsman’s Motion to Dismiss
on July 6, 2026, see ECF No. 136, and filed an Opposition to Simcha Newmark’s Motion to
Dismiss on July 16, 2026. See ECF No. 145. SmartShipped, Greenwald, and Landsman filed a
Reply in Further Support of their Motion to Dismiss on July 8, 2026. See ECF No. 138.
Accordingly, the Motions to Dismiss are ripe for consideration.
II. LEGAL STANDARDS
A. 12(b)(2)

Pursuant to Federal Rule of Civil Procedure 12(b)(2), a defendant can move to dismiss a
complaint for lack of personal jurisdiction. See Fed. R. Civ. P. 12(b)(2). “Once challenged, the
plaintiff bears the burden of establishing personal jurisdiction.” O’Connor v. Sandy Lane Hotel
Co., Ltd., 496 F.3d 312, 316 (3d Cir. 2007); see also Danziger & De Llano, LLP v. Morgan
Verkamp LLC, 948 F.3d 124, 129 (3d Cir. 2020) (explaining that a plaintiff has “the burden to
come forward with sufficient facts to establish that jurisdiction is proper” (internal quotations and
citation omitted)). Since the Court did not hold an evidentiary hearing, Plaintiff “need only
establish a prima facie case of personal jurisdiction” and is “entitled to have [its] allegations taken
as true and all factual disputes drawn in [its] favor.” O’Connor, 496 F.3d at 316 (internal
quotations and citation omitted).

In addition, while Plaintiff does not bear a “heavy” burden, it must demonstrate “with
reasonable particularity sufficient contacts between the defendant and the forum state” and “may
not rely on the bare pleadings alone.” Stern v. Aracari Project, No. 24-cv-1222, 2025 WL 899320,
at *2 (E.D. Pa. Mar. 21, 2025) (internal quotations and citations omitted). Rather, Plaintiff “must
respond with actual proofs, not mere allegations.” Patterson by Patterson v. F.B.I., 893 F.2d 595,
604 (3d Cir. 1990) (internal quotations and citation omitted); see also Metcalfe v. Renaissance
Marine, Inc., 566 F.3d 324, 330 (3d Cir. 2009) (explaining that a “plaintiff must ‘prov[e] by
affidavits or other competent evidence that jurisdiction is proper’” (quoting Dayhoff Inc. v. H.J.
Heinz Co., 86 F.3d 1287, 1302 (3d Cir. 1996))). Therefore, courts are allowed to “consider
extrinsic evidence when adjudicating a contest to personal jurisdiction.” Spring Pharms., LLC v.
Retrophin, Inc., No. 18-cv-4553, 2019 WL 6769988, at *5 (E.D. Pa. Dec. 11, 2019) (citing
Patterson by Patterson, 893 F.2d at 603–04).
B. 12(b)(3)

A defendant can move to dismiss claims against it for improper venue under Rule 12(b)(3).
See Fed. R. Civ. P. 12(b)(3). 28 U.S.C. § 1391(b) provides that a civil action can be brought in
three different venues. For example, a plaintiff can bring an action in “a judicial district in which
any defendant resides, if all defendants are residents of the State in which the district is located.”
28 U.S.C. § 1391(b)(1). In addition, a plaintiff can initiate a suit in “a judicial district in which a
substantial part of the events or omissions giving rise to the claim occurred, or a substantial part
of property that is the subject of the action is situated.” Id. § 1391(b)(2). Defendants “bear the
burden of showing improper venue.” Myers v. Am. Dental Ass’n, 695 F.2d 716, 725 (3d Cir. 1982).
When evaluating a Rule 12(b)(3) motion, “a court must accept as true the allegations in the
complaint, although both parties may submit affidavits in support of their positions.” MacKay v.

Donovan, 747 F. Supp. 2d 496, 502 (E.D. Pa. 2010). Multiple districts may be proper in which to
litigate an action, so “[v]enue does not have to be the ‘best forum’ for the action.” Id. (citation
omitted). In addition, “a plaintiff’s choice of venue is accorded deference, especially when that
choice is plaintiff’s home forum.” Id. (citing Shutte v. Armco Steel Corp., 431 F.2d 22, 25 (3d Cir.
1970)).
C. 12(b)(5)
A district court may dismiss a complaint for “insufficient service of process.” Fed. R. Civ.
P. 12(b)(5). It is Plaintiff’s responsibility to have “the summons and complaint served within the
time allowed by Rule 4(m),” see Fed. R. Civ. P. 4(c)(1), and a defendant can “object to the
plaintiff’s failure to comply with the procedural requirements for proper service.” White v. Green,
No. 09-cv-1219, 2009 WL 3209647, at *1 (E.D. Pa. Oct. 6, 2009) (internal quotations and citation
omitted), aff’d, 382 F. App’x 199 (3d Cir. 2010). When deciding a Rule 12(b)(5) motion, “the
party making the service has the burden of demonstrating its validity when an objection to service

is made.” Id. (internal quotations and citation omitted). If “process has not been properly served
on a defendant, district courts possess broad discretion to either dismiss the plaintiff’s complaint
for failure to effect service or to simply quash service of process.” Umbenhauer v. Woog, 969
F.2d 25, 30 (3d Cir. 1992).
D. 12(b)(6)
A Rule 12(b)(6) motion tests the sufficiency of a claim. When deciding a motion to dismiss
for failure to state a claim, the Court must “accept all factual allegations as true, [and] construe the
complaint in the light most favorable to the plaintiff.” Warren Gen. Hosp. v. Amgen Inc., 643 F.3d
77, 84 (3d Cir. 2011) (internal quotations and citation omitted). Conclusory allegations “are not
entitled to the assumption of truth.” Connelly v. Lane Constr. Corp., 809 F.3d 780, 787 (3d Cir.

2016) (internal quotations and citation omitted). To survive a Rule 12(b)(6) motion, a plaintiff’s
well-pleaded complaint must state a “plausible entitlement to relief[,]” and the “[f]actual
allegations must be enough to raise a right to relief above the speculative level.” Bell Atl. Corp. v.
Twombly, 550 U.S. 544, 555, 559 (2007). While a plaintiff is not required to plead “detailed factual
allegations,” Federal Rule of Civil Procedure 8(a)(2) “requires more than labels and conclusions,
and a formulaic recitation of the elements of a cause of action will not do.” Id. at 555; see also
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (“Threadbare recitals of the elements of a cause of
action, supported by mere conclusory statements, do not suffice.”). Put another way, the factual
allegations must “raise a reasonable expectation that discovery will reveal evidence of the
necessary element[s]” of the plaintiff’s claims. Connelly, 809 F.3d at 789 (internal quotations and
citation omitted); see also Iqbal, 556 U.S. at 678 (“A claim has facial plausibility when the plaintiff
pleads factual content that allows the court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.”).

When determining a Rule 12(b)(6) motion, district courts “must consider only the
complaint, exhibits attached to the complaint, matters of public record, as well as undisputedly
authentic documents if the complainant’s claims are based upon these documents.” Mayer v.
Belichick, 605 F.3d 223, 230 (3d Cir. 2010) (citing Pension Benefit Guar. Corp. v. White Consol.
Indus., Inc., 998 F.2d 1192, 1996 (3d Cir. 1993)). Courts may also consider “documents
incorporated into the complaint by reference, and matters of which a court may take judicial
notice.” OFI Asset Mgmt., 834 F.3d at 490 (internal quotations and citation omitted).
III. DISCUSSION
A. Personal Jurisdiction
The Court begins with Defendants Chaim Gross’, Shani Gross’, FoamTex’s, and Simcha

Newmark’s Motions to Dismiss for lack of personal jurisdiction. Under Federal Rule of Civil
Procedure 4(k), a district court exercises personal jurisdiction over an out-of-state defendant to the
extent authorized by the law of the state “where it sits.” O’Connor, 496 F.3d at 316 (citing Fed.
R. Civ. P. 4(k)(1)(A)); see also Daimler AG v. Bauman, 571 U.S. 117, 125 (2014). Here,
Pennsylvania’s long arm statute applies and allows for personal jurisdiction over nonresidents
“based on the most minimum contact with th[e] Commonwealth allowed under the Constitution
of the United States.” 42 Pa. Cons. Stat. Ann. § 5322(b). Accordingly, the Court must determine
whether it can exercise personal jurisdiction over Defendants Chaim Gross, Shani Gross,
FoamTex, and Simcha Newmark consistent with the Due Process Clause of the Fourteenth
Amendment.
There are multiple means by which a plaintiff can make out a prima facie showing of
personal jurisdiction over a defendant. A review of Plaintiff’s FAC and the parties’ briefing

reveals that Plaintiff has thrown jurisdictional “spaghetti at the wall” with the “hop[e] that some
of the mess will stick.” DLJ Mortg. Cap., Inc. v. Stevens, 167 F.4th 632, 634 (3d Cir. 2026).
Specifically, Plaintiff alleged in the FAC that this Court can exercise personal jurisdiction over
Chaim Gross, Shani Gross, FoamTex, and Simcha Newmark under three different theories: (1)
under a “closely related parties” theory; (2) as an alter ego of FellowShip and Milliard Enterprises;
and (3) under a single enterprise theory. See ECF No. 78 ¶¶ 16–17. In addition, as to FoamTex
only, Plaintiff alleged that this Court can exercise personal jurisdiction over FoamTex under a
fourth theory: the traditional test for specific jurisdiction. See id. ¶ 16. The Court will wade into
the morass of theories alleged by Plaintiff, which all fail for the reasons discussed in detail below.2
1. General Jurisdiction

To exercise general personal jurisdiction over a defendant, the defendant must have a
“‘continuous and systematic’” affiliation with the forum state so “as to render [it] essentially at
home in the forum state.” Daimler AG, 571 U.S. at 127 (quoting Goodyear Dunlop Tires

2 The Agreement contains a provision indicating that it “shall be interpreted, enforced and
governed by and under the laws of the Commonwealth of Pennsylvania, except regarding choice
of law.” ECF No. 69-7 § 12; see also ECF No. 78 ¶ 14. Throughout their briefing, the parties did
not expressly dispute whether Pennsylvania state law applies, did not conduct a choice-of-law
analysis, and primarily relied on Pennsylvania law to the extent the claims and jurisdictional
theories alleged in the FAC involved substantive issues. The Court finds that the parties have
“waived any objection to that choice of law by failing to make” any argument regarding it. Shuker
v. Smith & Nephew, PLC, 885 F.3d 760, 776 n.16 (3d Cir. 2018); see also Williams v. BASF
Catalysts, LLC, 765 F.3d 306, 316 (3d Cir. 2014) (“[P]arties may waive choice-of-law issues.”).
Accordingly, the Court need not conduct a choice-of-law analysis and will apply either federal or
Pennsylvania law.
Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011)). For individual defendants, the “paradigm
forum for the exercise of general jurisdiction” is their place of domicile. Goodyear Dunlop Tires
Operations, S.A., 564 U.S. at 924. “[F]or a corporation, it is an equivalent place, one in which the
corporation is fairly regarded as at home.” Id.; see also Daimler, 571 U.S. at 137 (explaining that

for “a corporation, the place of incorporation and principal place of business are paradig[m] . . .
bases for general jurisdiction” (internal quotations and citation omitted)). In the absence of general
jurisdiction, a court can still exercise jurisdiction over an out-of-state defendant if the requirements
of specific jurisdiction are satisfied or if a defendant has otherwise consented to the jurisdiction of
the Court.
Here, as alleged in the FAC, Chaim Gross is domiciled in and is a citizen of New Jersey,
see ECF No. 78 ¶¶ 4–7; Shani Gross is domiciled in and is a citizen of New Jersey, see id. ¶ 6;
FoamTex is a New Jersey LLC with its principal place of business in New Jersey, see id. ¶ 7; and
Simcha Newmark is domiciled in and is a citizen of New Jersey, see id. ¶ 7. The Court thus does
not have general jurisdiction over any of these Defendants because they are not considered “at
home” in Pennsylvania. Daimler AG, 571 U.S. at 127 (citation omitted).3

2. Consent to Jurisdiction Through a Forum Selection Clause
This case also involves a Pennsylvania forum selection clause. See ECF No. 78 ¶ 14; see
also ECF No. 69-7 § 12. As a general matter, “there are a variety of legal arrangements by which
a litigant may give express or implied consent to the personal jurisdiction of the court.” Burger

3 When foreign corporations register to do business in Pennsylvania, they effectively consent to
general jurisdiction under Pennsylvania’s statutory framework. See 15 Pa. Cons. Stat. § 411(a),
(f); see also 42 Pa. Cons. Stat. § 5301(a)(2). The Supreme Court has found that Pennsylvania’s
statute “comport[s] with the Due Process Clause.” Mallory v. Norfolk S. Ry. Co., 600 U.S. 122,
128 (2023); see also id. at 134, 146. Here, Plaintiff did not argue that this provides a basis for the
Court to exercise general jurisdiction over FoamTex, so the Court does not address it.
King Corp. v. Rudzewicz, 471 U.S. 462, 472 n.14 (1985) (internal quotations and citation omitted).
For instance, through forum selection clauses, parties often “stipulate in advance to submit
controversies for resolution within a particular jurisdiction[,]” thereby consenting to the
jurisdiction of that court. Id.; see also Mallory, 600 U.S. at 145 (explaining that “signing a contract

with a forum selection clause” is an action that “can carry . . . profound consequences for personal
jurisdiction”).
Here, Plaintiff alleged that Defendants FellowShip and Milliard Enterprises consented to
the jurisdiction of this Court when they signed the Agreement containing the Pennsylvania forum
selection clause. See ECF No. 78 ¶ 14; see also id. ¶ 15 (alleging that Defendants FellowShip and
Milliard Enterprises also consented to jurisdiction when they entered into a stipulation, in which
they agreed to submit to jurisdiction in the Eastern District of Pennsylvania). Although Defendants
Chaim Gross, Shani Gross, FoamTex, and Simcha Newmark did not sign the Agreement
themselves, Plaintiff asserts that the forum selection clause should still be applied to these four
Defendants on the basis that they are “closely related parties” to FellowShip and Milliard

Enterprises. See id. ¶¶ 16–17; see also ECF No. 123 at 15–17.
“Federal law controls the question of whether to enforce a forum selection clause.” In re
McGraw-Hill Glob. Educ. Holdings, 909 F.3d 48, 58 (3d Cir. 2018). However, state law “typically
governs . . . whether the clause applies to a non-signatory as a . . . closely related party[,]” though
contracting parties “are generally free to specify which law governs a contract’s interpretation, and
may agree to modify the choice specified in the contract.” Id. Here, the parties have applied
federal law in analyzing whether Defendants constitute closely related parties, see, e.g., ECF No.
109-1 at 14–15; ECF No. 110-1 at 10–11; ECF No. 111-1 at 18; ECF No. 123 at 15–17; ECF No.
132-1 at 14–15, so the Court “will therefore apply federal law” as well, in light of the parties’
apparent “stipulation.” In re McGraw-Hill Glob. Educ. Holdings, 909 F.3d at 58–59.
In the Third Circuit, there are “four substantive issues that bear on whether” a forum
selection clause applies to and binds a non-signatory. Id. at 59. Here, the parties have not moved

to transfer this action pursuant to 28 U.S.C. § 1404, so only three of the four elements are relevant
to the Court’s analysis. To determine whether non-signatories “are bound by the terms of [an]
agreement[]” between signatories, courts analyze: (1) whether the non-signatories are either
“intended third-party beneficiaries of the contract” or “closely related parties[;]” (2) whether
“enforcement was foreseeable to the non-signator[ies;]” and (3) whether “the dispute itself . . .
fall[s] within the scope of the forum selection clause.” Id.; see also Liberty Surplus Ins. Corp. v.
AXA Ins. Co., 788 F. App’x 850, 853 (3d Cir. 2019) (listing the same three elements).
With respect to the first element, “[i]n determining whether a non-signatory is closely
related to a contract, courts consider the non-signatory’s ownership of the signatory, its
involvement in the negotiations, the relationship between the two parties[,] and whether the non-

signatory received a direct benefit from the agreement.” In re McGraw-Hill Glob. Educ. Holdings,
909 F.3d at 63 (quoting Carlyle Inv. Mgmt. LLC v. Moonmouth Co. SA, 779 F.3d 214, 219 (3d Cir.
2015)). Courts have found a non-signatory to be closely related to a contractual dispute and bound
by a forum selection clause in a “variety of situations.” See Synthes, Inc. v. Emerge Med., Inc.,
887 F. Supp. 2d 598, 607 (E.D. Pa. 2012) (collecting cases). For example, the Third Circuit has
held that a corporate entity that was “affiliated” with the entity that signed the agreement on its
behalf, was “owned and controlled by” the same person as the signatory entity, and had “a close
relationship to the agreement itself” qualified as a closely related party. See Carlyle Inv. Mgmt.
LLC, 779 F.3d at 219 & n.3; see also First Fin. Mgmt. Grp. v. Univ. Painters of Balt., Inc., No.
11-cv-5821, 2012 WL 1150131, at *3 (E.D. Pa. Apr. 5, 2012) (“Corporations owned and controlled
by the party signing the contract containing the forum selection clause have been found to be bound
by the clause.”); Synthes, 887 F. Supp. 2d at 610 (explaining that “close business relationships
between the signatories and non-signatories to the pertinent agreements, together with the fact that

the dispute among the parties centered on the interpretation of the agreements” supported binding
the non-signatories). In addition, forum selection clauses have been enforced “against non-
signatories where their actions and interests are inextricably intertwined with the contract dispute
underlying [the] case.” Mackler v. SME, Inc. USA, No. 23-cv-4353, 2024 WL 3729872, at *7
(E.D. Pa. Aug. 8, 2024) (internal quotations and citation omitted); see also Meridian Bank v. Sandy
Spring Bank, No. 22-cv-3951, 2023 WL 8258769, at *5 (E.D. Pa. Nov. 29, 2023) (finding that co-
conspirators who were acting against the interests of the plaintiff were closely related to the
employment agreements at issue). Accordingly, “courts considering this question of whether a
non-signatory may be bound by a forum selection clause take a common sense, totality of the
circumstances approach that essentially inquires into whether, in light of those circumstances, it is

fair and reasonable to bind a non-party to the forum selection clause.” Synthes, 887 F. Supp. 2d at
607.
With respect to the second element, foreseeability is another “prerequisite to applying the
closely related parties doctrine.” In re McGraw-Hill Glob. Educ. Holdings LLC, 909 F.3d at 64.
“[B]efore binding a non-signatory as a closely related party,” courts “require a finding that
enforcement of the clause by or against the non-signatory would be foreseeable.” Id. (collecting
cases). As articulated by the Third Circuit, a finding of foreseeability “must have some evidentiary
basis, other than pure speculation, that the party sought to be bound had an awareness of the clause,
its contents, and that it might be defensively invoked.” Id. at 65. However, the forum selection
clause and its contents do not need to have been “reasonably communicated to the party against
whom enforcement is sought.” Id. (internal quotations and citation omitted). Instead,
foreseeability can be found as long as “there [is] some evidentiary basis for such a finding.” Id.;
see also JMJS, Inc. v. Idzi, No. 22-cv-1514, 2023 WL 6260121, at *4 (W.D. Pa. Sept. 26, 2023)

(“The application of this principle turns on whether the third party should have foreseen that it
could become embroiled in the contractual dispute between the signatories and be bound by their
agreement.”).
With respect to the third element, courts evaluate whether the claims asserted against the
defendants “fall within the scope of the forum selection clause.” In re McGraw-Hill Glob. Educ.
Holdings LLC, 909 F.3d at 59. “Whether or not a forum selection clause applies depends on what
the specific clause at issue says.” John Wyeth & Bro. Ltd. v. CIGNA Int’l Corp., 119 F.3d 1070,
1075 (3d Cir. 1997). Accordingly, determining the scope of the forum selection clause at issue
requires a court to examine the language of the clause. See id.
With this framework in mind, the Court turns to evaluating whether the Pennsylvania

forum selection clause can be applied to Defendants Chaim Gross, Shani Gross, Simcha Newmark,
and FoamTex pursuant to the closely related parties doctrine for purposes of exercising personal
jurisdiction.
a. Chaim Gross Is Not a Closely Related Party to the Agreement
The Court starts with whether Chaim Gross is a closely related party to the Pennsylvania
forum selection clause. Plaintiff alleged that Chaim Gross is a member of both FellowShip and
Milliard Enterprises. See ECF No. 78 ¶¶ 4–5. Specifically, Chaim Gross “is the 100% owner of
Milliard [Enterprises]” and “owns a 75% interest in FellowShip.” Id. ¶ 38(a), (d); see also id. ¶¶
9, 86. According to Plaintiff, Chaim Gross is thus a closely related party “by virtue of [his] status
as owner[] of the companies.” ECF No. 123 at 16. But as explained above, ownership of a
corporate entity is just one consideration in the Court’s determination as to whether an individual
qualifies as a closely related party. Courts also may consider the individual’s “involvement in the
negotiations, the relationship between the two parties[,] and whether the non-signatory received a
direct benefit from the agreement.” Carlyle Inv. Mgmt. LLC, 779 F.3d at 219.

Beyond the allegations regarding Chaim Gross’ ownership role in these two LLCs, see
ECF No. 78 ¶¶ 4–5, 9, 38, 86, there are no factual allegations in the FAC indicating whether he
also served as a senior executive, officer, or employee of these corporate entities, or otherwise
indicating the extent of his involvement in operating these entities on a day-to-day basis. There
are also no facts in the FAC demonstrating that Chaim Gross participated in the negotiations of
the Agreement or the communications surrounding it. Courts have found that senior executives of
companies qualify as closely related parties where they had personal involvement in or signed the
contract at issue containing the forum selection clause. See, e.g., Carlyle Inv. Mgmt. LLC, 779
F.3d at 219 (finding that an owner of a signatory entity was a closely related party where the owner
was listed in the agreement as the “primary contact person” for the entity and was involved in

negotiations); Powervar, Inc. v. Power Quality Scis., Inc., No. 20-cv-5908, 2021 WL 2986417, at
*3 (E.D. Pa. July 15, 2021) (finding that a plaintiff alleged sufficient facts to establish that Sweat,
“the sole and dominant shareholder,” was closely related where he “signed the [a]greement as
‘Owner’ of [the company]”); O’Shaughnessy v. Palazzo, 496 F. Supp. 3d 872, 879 (E.D. Pa. 2020)
(finding that the President of SSPT was a closely related party where the plaintiff alleged that “he
was personally involved in the recruitment of Plaintiff and the drafting of the documents, and that
[he] personally executed the promissory note”); Synthes, 887 F. Supp. 2d at 610–11, 615 (finding
that a Chief Operating Officer (“COO”) was a closely related party where the COO worked closely
with the sales representatives, had extensive knowledge of the agreements, and recognized the risk
of legal action). Here, Plaintiff has not sufficiently pleaded that Chaim Gross had any involvement
in the Agreement at issue. Furthermore, Chaim Gross did not sign the Agreement; instead, Jack
Kressner was the employee who purportedly signed the Agreement “as the ‘authorized
representative’ on behalf of the ‘Client’”—i.e., “FellowShip/Milliard.” ECF No. 78 ¶¶ 21, 25; see

also ECF No. 69-7 at 9. Moreover, while Plaintiff alleged generally that “Defendants accepted
the benefits of the services provided by Plaintiff[,]” see ECF No. 78 ¶ 28, Plaintiff did not plead
specific facts demonstrating how Chaim Gross himself received a direct benefit from the shipping
services arrangement between Plaintiff and Defendants FellowShip and Milliard Enterprises.
Second, as to foreseeability, Plaintiff leaves the Court to speculate as to how Chaim Gross
purportedly had knowledge of the Agreement, rather than pleading any facts or marshaling some
evidence demonstrating that he was “aware of or participated in . . . the contractual negotiations.”
In re: Howmedica Osteonics Corp., 867 F.3d 390, 407 n.13 (3d Cir. 2017). “[C]ourts do not apply
the ‘closely related parties’ doctrine if doing so would have been unforeseeable for the party
against whom the clause would be enforced.” Id. (collecting cases); see also In re McGraw-Hill

Glob. Educ. Holdings LLC, 909 F.3d at 65 (explaining that there must be “some evidentiary basis,
other than pure speculation” to satisfy foreseeability). In its Opposition, Plaintiff directed the
Court to two items: (1) the stipulation that FellowShip and Milliard Enterprises filed in the
California Action, in which those entities consented to jurisdiction in Pennsylvania; and (2) its
allegation that Plaintiff’s counsel sent Chaim Gross pre-lawsuit correspondence once the
Agreement had allegedly been breached. See ECF No. 123 at 16–17; see also ECF No. 78 ¶ 33.
However, the fact that Chaim Gross may have been involved in making decisions over the course
of this litigation as a client, and through his ownership role of the corporate entities, does not
support Plaintiff’s contention that it was foreseeable that the Pennsylvania forum selection clause
would later be defensively invoked against him in a personal capacity. At bottom, there are
insufficient facts in the FAC for the Court to find that Chaim Gross should have foreseen that he
would be bound by the forum selection clause.
For these reasons, Plaintiff has not satisfied its burden of showing that Chaim Gross is a

closely related party to the Agreement or that enforcement of the forum selection clause against
him was foreseeable. Accordingly, Plaintiff has failed to make out a prima facie showing that this
Court can exercise personal jurisdiction over Chaim Gross consistent with the closely related
parties doctrine.
b. Shani Gross and Simcha Newmark Are Not Closely Related Parties to the
Agreement
Next, Plaintiff purports to apply the Pennsylvania forum selection clause to Shani Gross
and Simcha Newmark through the closely related parties doctrine. But Plaintiff’s allegations
regarding Shani Gross and Simcha Newmark fail to satisfy the doctrine’s requirements to an even
greater extent than its allegations regarding Chaim Gross. Plaintiff attempts to manufacture a close
connection between Shani Gross, Simcha Newmark, and the forum selection clause by means of
their ownership position in other corporate entities that purportedly are “affiliated” with
FellowShip and Milliard Enterprises. See ECF No. 123 at 16; ECF No. 145 at 12–13. Plaintiff
alleged that Shani Gross is a member of Lakewood Candies and that she owns 10% of the
company. See ECF No. 78 ¶¶ 6, 38(b). Plaintiff further alleged that Simcha Newmark is a member
of FoamTex and owns one-third of the company. Id. ¶¶ 7, 38(c). According to Plaintiff, both

Lakewood Candies and FoamTex are “affiliated” with FellowShip and Milliard Enterprises. Id.
¶¶ 9, 83. However, there are no factual allegations in the FAC that Shani Gross or Simcha
Newmark are or were owners of FellowShip or Milliard Enterprises. Nor are there any factual
allegations that either Shani Gross or Simcha Newmark were ever involved in the negotiations of
the Agreement between Plaintiff, FellowShip, and Milliard Enterprises, or that Shani Gross or
Simcha Newmark received a direct benefit from the Agreement. Indeed, Shani Gross and Simcha
Newmark are each referenced in only three allegations in the FAC. See id. ¶¶ 6–7, 17, 38(b)–(c).
And Plaintiff has not pleaded sufficient facts or presented an “evidentiary basis” showing that

Shani Gross or Simcha Newmark had an awareness of the forum selection clause or that it could
be defensively invoked against them. In re McGraw-Hill Glob. Educ. Holdings LLC, 909 F.3d at
65. Applying the forum selection clause to Shani Gross and Simcha Newmark under these
circumstances would stretch the closely related parties doctrine too far and would not be
foreseeable.
Moreover, in its Opposition to Simcha Newmark’s Motion, Plaintiff argues that “Mr.
Newmark, as FoamTex’s one-third owner, is closely related to FoamTex in the same way that
Carlyle recognizes ownership interest as relevant to the closely-related-party inquiry.” ECF No.
145 at 13 (citing Carlyle Inv. Mgmt. LLC, 779 F.3d at 219). Once again, while ownership is a
relevant consideration in the closely related parties inquiry, the Carlyle Investment Management

LLC court focused on other facts beyond mere ownership to find a close connection between
affiliated entities, a common owner, and a contract. In Carlyle Investment Management LLC,
Plaza (one of the entities that the Third Circuit found was closely related) was the director of
Moonmouth (an affiliated corporate entity) and executed the subscription agreement at issue on
behalf of Moonmouth. Carlyle Inv. Mgmt. LLC, 779 F.3d at 219. Both Plaza and Moonmouth
were “owned and controlled by” the same individual, Reijtenbagh. Id. In addition, provisions
within the “[s]ubscription [a]greement itself indicate[d] the close relationship between
Moonmouth, Plaza, and Reijtenbagh.” Id. Reijtenbagh was listed as the “primary contact person”
for Moonmouth and was “also listed as a person authorized to give and receive instructions on
behalf of Moonmouth.” Id. The subscription agreement further stated that Plaza’s income was
the “‘source of funds’ for Moonmouth’s investment[,]” and the negotiations surrounding the
subscription agreement “were conducted by Moonmouth, Plaza, and Reijtenbagh.” Id. Based on
that amalgamation of facts, the Third Circuit agreed with the district court that Moonmouth, Plaza,

and Reijtenbagh were all closely related to the agreement. Id.
Here, by contrast, there are minimal facts in the FAC beyond Simcha Newmark’s partial
ownership of FoamTex—an entity that is allegedly affiliated with FellowShip and Milliard
Enterprises—that connect Newmark to the Agreement. Moreover, Plaintiff does not allege that
FoamTex or Newmark are mentioned in the Agreement itself, nor does Plaintiff allege that
Newmark is an owner of either of the signatory companies. See ECF No. 78 ¶¶ 38(a), (c)–(d). In
short, the facts that the Third Circuit relied upon in Carlyle Investment Management LLC to find
that an owner of an affiliated company was closely related to a contract are absent here with respect
to Simcha Newmark.
Therefore, Plaintiff has not adequately demonstrated that Shani Gross or Simcha Newmark

are “closely related to the [A]greement in such a way that it would be foreseeable that they would
be bound” to its forum selection clause. Carlyle Inv. Mgmt. LLC, 779 F.3d at 219. The Court thus
cannot exercise personal jurisdiction over Shani Gross or Simcha Newmark pursuant to the closely
related parties doctrine.
c. FoamTex Is Not a Closely Related Party to the Agreement
Finally, Plaintiff argues that FoamTex is a closely related party to the Agreement as an
“affiliated entit[y]” that is also “owned and controlled by” Chaim Gross. ECF No. 123 at 16; see
also ECF No. 78 ¶¶ 7, 9, 38(c) (alleging that FoamTex is also owned by Chaim Gross and is
“affiliated” with Milliard Enterprises and FellowShip). However, beyond Plaintiff’s allegation
that there is a common owner among the signatory companies and FoamTex, there are no
allegations in the FAC that FoamTex was involved in the negotiations surrounding the Agreement.
And Plaintiff does not allege that FoamTex is referenced within the Agreement. See Carlyle Inv.
Mgmt. LLC, 779 F.3d at 219 (finding that affiliated entities with a common owner were closely
related parties where one entity signed the subscription agreement on behalf of the other entity and

both were referenced in provisions in the agreement); First Financial Mgmt. Grp., Inc., 2012 WL
1150131, at *4 (finding that a corporation was “inextricably linked to the contract containing the
forum selection clause” where the corporation “was listed as the ‘entity controlled by [l]icensee’”
within the contract and was established through the contract). Indeed, Plaintiff may not have even
been aware of FoamTex’s existence until Chaim Gross was deposed in connection with this
litigation. See ECF No. 62 at 5–6; cf. ECF No. 78 ¶ 37.
Plaintiff argues that FoamTex benefited from the Agreement because “it shared the
shipping accounts that Plaintiff reviewed and advised upon, used those accounts to send its
shipments, and thus took advantage of the benefits of Plaintiff’s services under the Agreement.”
ECF No. 123 at 16; see also ECF No. 78 ¶¶ 50, 91. But Plaintiff did not allege that the Agreement

itself contained any provisions contemplating that FoamTex would receive a direct benefit from
Plaintiff’s services. In addition, Plaintiff did not allege that the contracting parties expected that
FoamTex would receive a direct benefit from the contractual relationship. In other words,
assuming the truth of Plaintiff’s allegations that FoamTex has been using shipping accounts that
Plaintiff advised upon in 2023 when it gave FellowShip and Milliard Enterprises access to its
proprietary information, see id. ¶¶ 27–30, 50, 91, any benefit that FoamTex later received occurred
indirectly. Furthermore, with respect to foreseeability, Plaintiff has not pleaded sufficient facts or
presented an adequate “evidentiary basis” from which the Court can reasonably deduce that
FoamTex had an awareness of the Pennsylvania forum selection clause or that it could be invoked
against it. In re McGraw-Hill Glob. Educ. Holdings LLC, 909 F.3d at 65; cf. Metcalfe, 566 F.3d
at 330 (explaining that a “plaintiff must ‘prov[e] by affidavits or other competent evidence that
jurisdiction is proper’” (quoting Dayhoff Inc., 86 F.3d at 1302)).
For these reasons, Plaintiff has not sufficiently demonstrated that this Court can exercise

personal jurisdiction over FoamTex in accordance with the closely related parties doctrine.
3. Traditional Test for Specific Jurisdiction
Next, the Court turns to the traditional test for specific jurisdiction. In its FAC and its
Opposition, Plaintiff asserted that the Court can exercise specific jurisdiction over FoamTex
pursuant to the traditional test that assesses a defendant’s contacts with the forum. See ECF No.
78 ¶ 16; see also ECF No. 123 at 17.4 In its Motion to Dismiss, FoamTex argues that specific
jurisdiction does not exist because Plaintiff did not identify any “Pennsylvania-directed conduct
by FoamTex” in its FAC and only alleged generally that FoamTex “‘us[ed] shipping services
provided by Plaintiff’ and ‘benefit[ed] from’ services ‘provided . . . from this District.’” ECF No.
111-1 at 16 (quoting ECF No. 78 ¶ 16). According to FoamTex, the use of Plaintiff’s “services

does not establish that FoamTex purposefully directed conduct at the forum.” Id. at 16–17.
Instead, FoamTex argues that the “Calder effects test” requires a plaintiff to demonstrate conduct

4 In its Opposition to Simcha Newmark’s Motion to Dismiss, Plaintiff argues for the first time that
this Court can exercise specific jurisdiction over Newmark under the traditional test. See ECF No.
145 at 13–14. Plaintiff claims that Newmark’s “use of a milliardbrands.com email address in
connection with Defendants’ shipping accounts . . . and his ownership interest in FoamTex, which
manufactures its products in Pennsylvania” demonstrate purposeful availment of the privilege of
conducting business in Pennsylvania. Id. at 13. However, Plaintiff did not allege in its FAC that
the Court can exercise specific jurisdiction over Newmark under the traditional test, so the Court
will not address this theory as to Newmark because “[i]t is axiomatic that the complaint may not
be amended by the briefs in opposition to a motion to dismiss.” Commonwealth of Pa. ex rel.
Zimmerman v. PepsiCo, Inc., 836 F.2d 173, 181 (3d Cir. 1988) (internal quotations and citation
omitted); see also ECF No. 145 at 14 (arguing that “Mr. Newmark’s personal jurisdiction exposure
. . . rests on paragraph 17’s closely-related-party allegation . . . and from his role as an aider and
abettor of Mr. Gross’s fraud” (citing ECF No. 78 ¶¶ 104–06)).
that is “‘expressly aimed’ at the forum.” Id. at 17 (quoting IMO Indus., Inc. v. Kiekert AG, 155
F.3d 254, 265–66 (3d Cir. 1998)).
Plaintiff reduces its position to a single paragraph in its Opposition. See ECF No. 123 at
17. Plaintiff contends that specific jurisdiction exists because FoamTex has “purposefully availed

itself of the privilege of conducting activities within Pennsylvania by using shipping services
provided by Plaintiff to send shipments of its items here, and by exploiting Plaintiff’s services
provided from this district.” Id. (first citing ECF No. 78 ¶ 16; then citing Ford Motor Co. v. Mont.
Eighth Jud. Dist. Ct., 592 U.S. 351, 359 (2021)). In support of its argument, Plaintiff points to
portions of Chaim Gross’ deposition testimony, in which he stated that “FoamTex manufactures
its products in Pennsylvania.” Id. (citing ECF No. 123-2 at 57:10–19). According to Plaintiff,
“[i]t therefore follows that [FoamTex] conducted shipping activity in Pennsylvania[,]” and
“Plaintiff’s claims ‘arise out of or relate to’ that shipping activity.” Id.
Specific jurisdiction “covers defendants less intimately connected with a State.” Ford
Motor Co., 592 U.S. at 359. The Supreme Court has set forth “two tests for specific jurisdiction:

(1) the ‘traditional’ test—also called the ‘minimum contacts’ or purposeful availment test[;]” and
“(2) the ‘effects’ test,” which was articulated in Calder v. Jones, 465 U.S. 783 (1984). See Hasson
v. FullStory, Inc., 114 F.4th 181, 186 (3d Cir. 2024) (citations omitted). The traditional test has
three components. First, a plaintiff must demonstrate that “the defendant has minimum contacts
with the forum such that it purposefully avail[ed] itself of the privilege of conducting activities
within the forum and invok[ed] the benefits and protections of [the forum’s] laws.” Id. (internal
quotations and citation omitted). Next, the plaintiff’s claims must “arise out of or relate to the
defendant’s contacts with the forum[,]” such that there is evidence of “a strong relationship among
the defendant, the forum, and the litigation.” Ford Motor Co., 592 U.S. at 359, 365 (internal
quotations and citations omitted). Finally, exercising jurisdiction over the defendant must
“comport[] with traditional notions of fair play and substantial justice such that the defendant
should reasonably anticipate being haled into court in that forum.” Hasson, 114 F.4th at 186
(internal quotations and citation omitted).5

The Court turns to evaluating whether Plaintiff has satisfied the traditional test for specific
jurisdiction, beginning with the first prong. FoamTex is a New Jersey LLC with its principal place
of business in New Jersey. See ECF No. 78 ¶ 7. Plaintiff did not allege that FoamTex is a signatory
to the Agreement with Plaintiff, but even if it were a signatory, “[t]he mere existence of a contract”
with an in-forum plaintiff “is insufficient to establish minimum contacts.” Budget Blinds, Inc. v.
White, 536 F.3d 244, 261 (3d Cir. 2008) (citing Burger King Corp., 471 U.S. at 478). Here,
Plaintiff pleaded one generalized allegation that FoamTex “directed [its] activities toward, and
purposefully availed [itself] of, the forum by conducting business in this District, including by
using shipping services provided by Plaintiff to send shipments of [its] items and by exploiting
and financially benefiting from the services provided by Plaintiff from this District.” ECF No. 78

¶ 16. But that singular, conclusory allegation tells the Court almost nothing as to whether or how
FoamTex was targeting its activities towards Pennsylvania. And Plaintiff did not otherwise plead
specific facts regarding any in-forum conduct by FoamTex in its FAC. Instead, Plaintiff primarily
attempts to tie its own contacts—i.e., its provision of services in Pennsylvania—to FoamTex,

5 In its Motion to Dismiss, FoamTex invoked Calder’s effects test. See ECF No. 111-1 at 17.
However, Plaintiff did not provide any argument in response to FoamTex’s invocation of the
effects test and instead only addressed the traditional test in its Opposition. See ECF No. 123 at
17. Since Plaintiff “had ample opportunity to” address this theory in response to FoamTex’s
Motion to Dismiss, but “failed to do so[,]” the Court will not consider the argument here as a basis
by which it can exercise personal jurisdiction over FoamTex. See Dreibelbis v. Scholton, 274 F.
App’x 183, 185 (3d Cir. 2008) (finding that the “district court exercised sound discretion when it
refused to consider an argument that, in effect, had been waived” (collecting cases)).
which is insufficient to satisfy the first prong. See Walden v. Fiore, 571 U.S. 277, 286 (2014)
(“[T]he plaintiff cannot be the only link between the defendant and the forum. Rather, it is the
defendant’s conduct that must form the necessary connection with the forum State that is the basis
for its jurisdiction over him.”). Notwithstanding this pleading deficiency, Plaintiff attached

evidence to its Opposition indicating that FoamTex manufactures products in Pennsylvania. See
ECF No. 123-2 at 57:10–19. Therefore, Plaintiff has made a prima facie showing that FoamTex
has at least some minimum contacts with Pennsylvania by means of its manufacturing activity,
such that it has purposefully availed itself of the privilege of conducting business within the forum.
Plaintiff’s FAC falters at the second prong, though. When the Court scrutinizes FoamTex’s
contacts—manufacturing activity in Pennsylvania—in the context of the claims that Plaintiff has
asserted against FoamTex, the “connection” between “the defendant, the forum, and the litigation”
is “too weak” to support the exercise of specific jurisdiction. Hepp v. Facebook, 14 F.4th 204, 208
(3d Cir. 2021) (internal quotations and citation omitted). When assessing specific jurisdiction, the
“usual practice” is to do so “on a claim by claim basis.” United Emp. Assocs. v. Landmark Constr.

Co., Inc., No. 23-cv-3668, 2024 WL 4988982, at *4 (E.D. Pa. Dec. 5, 2024) (internal quotations
and citation omitted), appeal dismissed, No. 25-1024, 2025 WL 1824825 (3d Cir. May 1, 2025);
see also Danziger & De Llano, LLP, 948 F.3d at 130 (“Whether a plaintiff’s claims ‘arise out of
or relate to’ the defendant’s contacts with the forum state depends, in part, on the type of claim
brought.” (citation omitted)). However, “it may not be necessary to do so for certain factually
overlapping claims,” such as when a plaintiff asserts a breach of contract claim and an unjust
enrichment claim in the alternative, as Plaintiff has done here with respect to FoamTex. United
Emp. Assocs., 2024 WL 4988982, at *4 (internal quotations and citation omitted).
Notably, Plaintiff does not contend that its claims against FoamTex arise out of or relate to
any of FoamTex’s manufacturing activity in Pennsylvania. See ECF No. 123 at 17. Instead,
Plaintiff’s position is that its claims against FoamTex “‘arise out of relate to’ [FoamTex’s]
shipping activity.” Id. (emphasis added); see also ECF No. 78 ¶ 16. That is a significant issue for

Plaintiff because it simply assumes that, because FoamTex manufactured products in
Pennsylvania, “[i]t therefore follows that it conducted shipping activity in Pennsylvania.” ECF
No. 123 at 17. The Court does not make the same assumption. Unlike FoamTex’s manufacturing
activity, which was bolstered by deposition testimony, Plaintiff has not presented any evidence in
support of its contention that FoamTex ships its products in Pennsylvania. Nor does the FAC
contain any factual allegations regarding, for example, the extent or nature of FoamTex’s shipment
of its products in Pennsylvania, whether FoamTex ships its products to customers located in
Pennsylvania, or any quantifiable evidence of shipments in Pennsylvania. In other words, Plaintiff
has not made a prima facie showing that FoamTex’s shipping activities serve as a contact to the
forum. And because FoamTex challenged jurisdiction, it is Plaintiff’s burden to set forth

“competent evidence that jurisdiction is proper,” Metcalfe, 566 F.3d at 330 (internal quotations
and citation omitted), as opposed to relying on “mere allegations” alone that FoamTex made use
of Plaintiff’s shipping services. Miller Yacht Sales, Inc. v. Smith, 384 F.3d 93, 101 n.6 (3d Cir.
2004).
Turning to the claims that Plaintiff has brought against FoamTex, the Court begins with
whether Plaintiff’s breach of contract claim sufficiently arises out of or relates to FoamTex’s
alleged manufacturing activity in Pennsylvania.6 To demonstrate relatedness in a contract case,

6 Because Plaintiff’s unjust enrichment claim is “factually overlapping[,]” the Court does not
independently assess that claim. See United Emp. Assocs., 2024 WL 4988982, at *4.
district courts inquire whether “[t]he defendant’s contacts with the forum” were “instrumental in
either the formation of the contract or its breach.” Danziger & De Llano, LLP, 948 F.3d at 130
(emphasis omitted). For example, “courts recognize ‘prior negotiations and contemplated future
consequences, along with the terms of the contract and the parties’ actual course of dealing’ as

evidence of such purposeful contact” from which a plaintiff’s claims arise out of or relate to.
United Emp. Assocs., 2024 WL 4988982, at *4 (quoting Burger King, 471 U.S. at 479).
With respect to Plaintiff’s contract-based claim, Plaintiff has not adequately demonstrated
how FoamTex’s manufacturing contacts with Pennsylvania were instrumental in either the
formation of, or the alleged breach of, the Agreement between Plaintiff, FellowShip, and Milliard
Enterprises. Plaintiff did not allege that there is an express, written contract between Plaintiff and
FoamTex; rather, Plaintiff relies on a single enterprise theory of liability to impute a breach to
FoamTex. See ECF No. 78 ¶¶ 85–89. In addition, the FAC does not contain facts regarding any
contractual negotiations between Plaintiff and FoamTex that may have been conducted in
Pennsylvania, any communications between Plaintiff and FoamTex that may have been exchanged

in Pennsylvania, or any longstanding course of dealing or business relationship that may have
occurred in Pennsylvania. Moreover, FoamTex is not alleged to have sent any payments to
Plaintiff in connection with the Agreement. See id. ¶ 52 (alleging that a bank account in Lakewood
Candies’ name made a $25,000 payment to Plaintiff). In other words, the contractual contacts that
courts tend to look for when evaluating relatedness are not present in Plaintiff’s FAC. See United
Emp. Assocs., 2024 WL 4988982, at *9 (“reject[ing] the notion that the few contacts by [the
defendant] were at all instrumental in the formation or breach of a contract between” the defendant
and plaintiff and therefore finding a lack of personal jurisdiction).
With respect to Plaintiff’s PUVTA claim against FoamTex, Plaintiff likewise has not
sufficiently demonstrated how FoamTex’s manufacturing activity in Pennsylvania arises out of or
relates to a claim centered around a fraudulent transfer. For example, Plaintiff did not allege that
the purported grant of a software license and transfer of “business and assets to FoamTex” occurred

in Pennsylvania. ECF No. 78 ¶¶ 51, 73. Nor did Plaintiff allege that any movement of assets from
FellowShip’s or Milliard Enterprises’ bank accounts to FoamTex was tied to accounts located in
Pennsylvania. The only connection that this claim appears to have to Pennsylvania is that the
alleged creditor (i.e., Plaintiff) is a Pennsylvania entity. See id. ¶ 3. However, as discussed above,
this is insufficient for the purposes of establishing that specific jurisdiction exists over FoamTex.
See Walden, 571 U.S. at 286 (“[A] defendant’s relationship with a plaintiff or third party, standing
alone, is an insufficient basis for jurisdiction.”).
In sum, there is not a “strong relationship among the defendant, the forum, and the
litigation” with respect to the contacts Plaintiff has demonstrated that FoamTex has with
Pennsylvania and the claims that Plaintiff has asserted against FoamTex. Ford Motor Co., 592

U.S. at 365 (internal quotations and citation omitted). Therefore, Plaintiff has not adequately met
its burden of showing that this Court can exercise specific jurisdiction over FoamTex under the
traditional test.
4. Alter Ego Jurisdiction
Next, Plaintiff alleged that this Court can exercise personal jurisdiction over Defendants
Chaim Gross, Shani Gross, and FoamTex pursuant to an alter ego theory of jurisdiction. See ECF
No. 78 ¶¶ 16–17.7 In its Opposition, Plaintiff argues that because Chaim Gross, Shani Gross, and

7 Plaintiff initially alleged that this Court can exercise personal jurisdiction over Simcha Newmark
as an alter ego of FellowShip and Milliard Enterprises. See ECF No. 78 ¶ 17. However, Plaintiff
has since abandoned its alter ego theory as to Newmark by failing to address the theory in its
FoamTex are all “alter egos of Milliard [Enterprises] and Lakewood, who are subject to personal
jurisdiction in this Court[,]” the Court can, in turn, exercise personal jurisdiction over them as well
by imputation. ECF No. 123 at 17. However, in its FAC, Plaintiff only alleged that Chaim Gross,
Shani Gross, and FoamTex are “alter egos of FellowShip and Milliard [Enterprises].” ECF No.

78 ¶¶ 16–17 (emphasis added). To the extent that Plaintiff now argues in its Opposition that these
three Defendants are also alter egos of Lakewood Candies, the Court will not consider that
argument because Plaintiff cannot use its Opposition to amend the FAC. See Commonwealth of
Pa. ex rel. Zimmerman, 836 F.2d at 181 (internal quotations and citation omitted).
Under the alter ego theory of jurisdiction, “[a] court may exercise personal jurisdiction,
consistent with the Constitution, over a corporate entity that is the alter ego of a party over which
jurisdiction is proper.” Katz v. DNC Servs. Corp., No. 16-cv-5800, 2017 WL 5885672, at *4 (E.D.
Pa. Nov. 29, 2017) (internal quotations and citation omitted); cf. Shuker, 885 F.3d at 781 (“[I]f a
subsidiary is merely the agent of a parent corporation, . . . or if the parent corporation otherwise
‘controls’ the subsidiary, then personal jurisdiction exists over the parent whenever personal

jurisdiction (whether general or specific) exists over the subsidiary.” (internal quotations and
citations omitted)). “The exercise of jurisdiction over an alter ego is compatible with due process
because a corporation and its alter ego are the same entity—thus, the jurisdictional contacts of one
are the jurisdictional contacts of the other for purposes of the International Shoe due process

Opposition to Newmark’s Motion. See ECF No. 145 at 12–14 (arguing only that the Court can
exercise personal jurisdiction over Newmark under the closely related parties doctrine and the
traditional test for specific jurisdiction); see also Dreibelbis, 274 F. App’x at 185 (affirming a
district court’s refusal to consider an argument where the plaintiff “had ample opportunity to make
this argument in response to defendants’ motion to dismiss and failed to do so”). Accordingly, the
Court need not determine whether Simcha Newmark is an alter ego of FellowShip or Milliard
Enterprises for jurisdictional purposes. Id. (“[T]he [d]istrict [c]ourt exercised sound discretion
when it refused to consider an argument that, in effect, had been waived.” (collecting cases)).
analysis.” Sys. Div., Inc. v. Teknek Elecs., Ltd., 253 F. App’x 31, 37 (Fed Cir. 2007). The alter
ego theory allows a court to impute an in-forum corporate entity’s contacts to a related corporate
entity where the plaintiff can establish that “the out-of-forum corporation either controls or is
controlled by an in-forum affiliate to such a degree that the two corporations operate as a single,

amalgamated entity.” In re Chocolate Confectionary Antitrust Litig., 674 F. Supp. 2d 580, 596
(M.D. Pa. 2009); see also In re Enter. Rent-A-Car Wage & Hour Emp. Pracs. Litig., 735 F. Supp.
2d 277, 319 (W.D. Pa. 2010) (“[T]he alter-ego test looks to whether the degree of control exercised
by the parent is greater than normally associated with common ownership and directorship and
whether the parent controls the day-to-day operations of the subsidiary such that the subsidiary
can be said to be a mere department of the parent.” (internal quotations and citation omitted)),
aff’d, 683 F.3d 462 (3d Cir. 2012) [hereinafter In re Enter.].
When determining “whether to apply the alter ego theory, [the Court] must start from the
general rule that the corporate entity should be upheld unless specific, unusual circumstances call
for an exception.” Riad v. Porsche Cars N. Am., Inc., 657 F. Supp. 3d 695, 701 (E.D. Pa. 2023)

(internal quotations and citation omitted). “Proving that a corporation is merely an alter ego is a
burden that is notoriously difficult for plaintiffs to meet.” Trinity Indus., Inc. v. Greenlease
Holding Co., 903 F.3d 333, 365 (3d Cir. 2018) (internal quotations and citation omitted); see also
Reynolds v. Turning Point Holding Co., LLC, No. 19-cv-1935, 2020 WL 953279, at *3 (E.D. Pa.
Feb. 26, 2020) (“Courts have noted a ‘strong presumption’ against . . . deeming companies alter-
egos of each other.” (collecting cases)). That said, determining whether a court has jurisdiction
“over an alleged alter ego is ‘a less onerous standard’ than [the standard that courts] apply under
[Rule] 12(b)(6) for piercing the corporate veil for liability purposes.” Sugartown Worldwide LLC
v. Shanks, 129 F. Supp. 3d 201, 205 (E.D. Pa. 2015) (quoting Bell v. Fairmont Raffles Hotel Int’l,
No. 12-cv-757, 2013 WL 6175717, at *3 (W.D. Pa. Nov. 25, 2013)). In this district, courts
consider the following ten factors when determining whether a corporate entity can be understood
to be an alter ego for jurisdictional purposes:
(1) ownership of all or most of the stock of the related corporation;
(2) common officers and directors; (3) common marketing image;
(4) common use of a trademark or logo; (5) common use of
employees; (6) integrated sales system; (7) interchange of
managerial and supervisory personnel; (8) performance by the
related corporation of business functions which the principal
corporation would normally conduct through its own agent or
departments; (9) acting of the related corporation as marketing arm
of the principal corporation, or as an exclusive distributor; and (10)
receipt by the officers of the related corporation of instruction from
the principal corporation.
Lutz v. Rakuten, Inc., 376 F. Supp. 3d 455, 471 (E.D. Pa. 2019) (citing Neopart Transit, LLC v.
CBM N.A. Inc., 314 F. Supp. 3d 628, 645 (E.D. Pa. 2018)). “No single factor is dispositive, and
the court may consider all relevant evidence to determine whether . . . actual control” is
demonstrated. In re Chocolate Confectionary Antitrust Litig., 602 F. Supp. 2d 538, 570 (M.D. Pa.
2009).
At the outset, the Court questions the applicability of the alter ego theory to FoamTex in
this case because this theory tends to arise in the context of general jurisdiction when a plaintiff
seeks to impute the continuous and systematic contacts of an in-forum subsidiary corporation to
an out-of-forum parent corporation. See Lutz, 376 F. Supp. 3d at 470–71 (addressing the alter ego
theory of personal jurisdiction as applied to the subsidiary and parent corporations); Katz, 2017
WL 5885672, at *4–5 (expressing skepticism that the alter ego theory applies where there is “no
formal corporate relationship” between defendants). Here, Plaintiff did not allege that FoamTex
has a parent-subsidiary relationship with FellowShip or Milliard Enterprises, nor did Plaintiff
allege that FoamTex is a successor company to either entity. Nevertheless, because some courts
appear to have applied the doctrine outside of a parent-subsidiary relationship, the Court proceeds
to consider the alter ego theory. See Copia Commc’ns, LLC v. AMResorts, L.P., No. 16-cv-5575,
2017 WL 4012687, at *6 (E.D. Pa. Sept. 11, 2017) (explaining that the alter ego theory is “most
readily applied in the context of parent/subsidiary relationships between entities[,]” but noting that

“in some instances the alter ego theory may apply in the context of other sorts of corporate
arrangements, so long as their operations and management are sufficiently interconnected”).
a. FoamTex Is Not an Alter Ego
Plaintiff initially alleged that FoamTex is an alter ego of FellowShip and Milliard
Enterprises. See ECF No. 78 ¶ 16. However, in its Opposition, Plaintiff no longer argues that
FoamTex is an alter ego of FellowShip, see ECF No. 123 at 17–19, so it has abandoned its assertion
of alter ego jurisdiction over FoamTex by way of its alleged relationship with that corporate entity.
See Dreibelbis, 274 F. App’x at 185 (finding that the “district court exercised sound discretion
when it refused to consider an argument that, in effect, had been waived” (collecting cases)).
Accordingly, the Court only addresses whether FoamTex can be considered an alter ego of
Milliard Enterprises.

Furthermore, although Plaintiff’s argument is not well-fleshed out, Plaintiff appears to be
seeking to impute Milliard Enterprises’ consent to jurisdiction through the forum selection clause
to FoamTex, rather than imputing jurisdiction to FoamTex through Milliard Enterprises’ contacts
with the forum. See ECF No. 123 at 18–19. Courts have found that waivers of personal
jurisdiction can be imputed to alter ego corporations. See Patin v. Thoroughbred Power Boats,
Inc., 294 F.3d 640, 653 (5th Cir. 2002) (finding that “it is consistent with due process to impute a
corporation’s waiver of personal jurisdiction to its successor (or its individual alter ego)”); see also
Platina Bulk Carriers Pte Ltd. v. Praxis Energy Agents DMCC, No. 20-cv-4892, 2021 WL
4137528, at *4 (S.D.N.Y. Sept. 10, 2021) (“[A] forum selection clause may be enforced against a
[signatory] company’s alter ego.”).
Here, some of the ten factors articulated above point towards a finding that FoamTex is an
alter ego of Milliard Enterprises. As to the second factor, FoamTex shares a common majority

owner with Milliard Enterprises—i.e., Chaim Gross. See ECF No. 78 ¶ 38(a), (c); see also id. ¶
39. As to the third and fourth factors, Plaintiff alleged that FoamTex and Milliard Enterprises
“project[] the image of being a singular business” under the “Milliard” or “Milliard Brands” name.
Id. ¶ 40; see also id. ¶¶ 41–43, 61. In addition, representatives of both FoamTex and Milliard
Enterprises “used milliardbrands.com email addresses when communicating with third parties[,]”
see id. ¶ 43; used “the same shared website, www.milliardbrands.com[,]” see id. ¶ 44; used that
website “to market and sell the furniture, mattresses, and household goods products of Milliard
[Enterprises] . . . and Foamtex, all under the same ‘Milliard’ name and logo[,]” see id. ¶ 45; and
“interchangeably used the same Amazon storefronts to market and sell their products online[,]”
see id. ¶ 46; see also id. ¶ 40 (alleging that FoamTex and Milliard Enterprises sell the same

products). As to the sixth and eighth factors, Plaintiff alleged that FoamTex and Milliard
Enterprises “have used the same set of shipping accounts and subaccounts[,]” see ECF No. 78 ¶
50; that, on “information and belief,” FoamTex and Milliard Enterprises “have shared the same
bank accounts with one another and comingled funds[,]” see id. ¶ 52; and that, on “information
and belief,” Milliard Enterprises has “laid out the money for FoamTex’s shipping needs[,]” see id.
¶ 54. Therefore, there is some indication that the two companies used a similar sales system and
that Milliard Enterprises has performed business functions for FoamTex, though Plaintiff’s
showing of integration and operational control is not particularly strong, nor bolstered by evidence.
See In re Enterpr., 735 F. Supp. 2d at 323 (finding that “the resources defendant parent provided
to its operating subsidiaries” did “not show a high-level of operational control over the operating
subsidiaries[,]” and the fact that a company “is portrayed as a single brand to the public” does not
necessarily “demonstrate the necessary control.”).
Other factors cut in the opposite direction and against a high degree of day-to-day

operational control. As to the first factor, there are no allegations in the FAC that FoamTex owns
the stock of Milliard Enterprises, or vice versa. As to the second factor, beyond a common owner,
there are otherwise no allegations as to whether these two companies share common officers or
directors. Cf. id. (“A degree of control naturally flows from” the “sharing by the corporations of
directors and the ownership by defendant parent of one-hundred percent of [a subsidiary’s] stock[,]
. . . but this incidental control does not rise to the level required to permit the exercise of jurisdiction
over the parent.”). As to the fifth and seventh factors, Plaintiff did not specifically allege that
FoamTex and Milliard Enterprises share common employees or managerial and supervisory
personnel. As to the ninth and tenth factors, Plaintiff did not allege that FoamTex acts as a
marketing arm or exclusive distributor for Milliard Enterprises, or that officers of Milliard

Enterprises receive instructions from or are directed by FoamTex on a day-to-day basis.
Furthermore, the record before the Court does not reflect, for example, whether or the extent to
which FoamTex controls Milliard Enterprises’ budget, or whether FoamTex oversees essential
components of Milliard Enterprises’ businesses. This is significant because “[a]lter ego
jurisdiction requires evidence of such control.” In re Chocolate Confectionary Antitrust Litig.,
602 F. Supp. 2d at 571.
On balance, after considering the relevant factors, the Court finds that Plaintiff has failed
to plead sufficient facts and has failed to put forth “competent evidence” demonstrating that
FoamTex is an alter ego of Milliard Enterprises for jurisdictional purposes. Dayhoff Inc., 86 F.3d
at 1302. As alleged in the FAC, there are not enough facts showing that FoamTex pervasively
“controls or is controlled by” Milliard Enterprises “to such a degree that the two corporations
operate as a single, amalgamated entity.” Katz, 2017 WL 5885672, at *4 (internal quotations and
citation omitted); see also In re Enter., 735 F. Supp. 2d at 324 (finding that an operating subsidiary

was “not the alter ego of defendant parent” where the evidence did not “show defendant parent
exercised any control over the internal workings or day-to-day operations of its subsidiaries”
(internal quotations and citation omitted)); In re Chocolate Confectionary Antitrust Litig., 602 F.
Supp. 2d at 571 (finding that plaintiff failed to demonstrate “a prima facie case of alter ego
jurisdiction” where the evidence presented did not establish “the corporate parents’ actual control
over the daily affairs of their subsidiaries”). Accordingly, this Court cannot exercise personal
jurisdiction over FoamTex by imputing Milliard Enterprises’ agreement to a forum selection
clause to FoamTex pursuant to an alter ego theory.
b. Chaim and Shani Gross Are Not Alter Egos
The Court turns next to the individual Defendants, Chaim and Shani Gross. Plaintiff
initially alleged in its FAC that Chaim and Shani Gross are “alter egos of FellowShip and Milliard

[Enterprises].” ECF No. 78 ¶ 17. In its Opposition, however, Plaintiff now argues that Chaim and
Shani Gross are “alter egos of Lakewood [Candies] and/or the other entity Defendants[,]” but
primarily provides argument regarding Lakewood Candies. ECF No. 123 at 19. Since Plaintiff
did not allege in its FAC that Chaim and Shani Gross are alter egos of Lakewood Candies, the
Court will not address that contention here because, as explained above, Plaintiff cannot use its
Opposition to amend the FAC. See Commonwealth of Pa. ex rel. Zimmerman, 836 F.2d at 181.
Despite the minimal argument that Plaintiff provided as to how Chaim and Shani Gross can be
considered alter egos of FellowShip or Milliard Enterprises, the Court will analyze this argument.
Courts have found that “[e]xercising jurisdiction over a corporate control person who is
alleged to be an entity’s alter ego is compatible with due process when [the court] can properly
exercise jurisdiction over the entity based on the premise the alter ego is the same entity.”
Sugartown Worldwide LLC, 129 F. Supp. 3d at 205 (internal quotations and citation omitted)

(collecting cases); see also Est. of Thomson ex rel. Est. of Rakestraw v. Toyota Motor Corp.
Worldwide, 545 F.3d 357, 362 (6th Cir. 2008) (“[F]ederal courts have consistently acknowledged
that it is compatible with due process for a court to exercise personal jurisdiction over an individual
. . . when the individual . . . is an alter ego . . . of a corporation that would be subject to personal
jurisdiction in that court.” (quoting Patin, 294 F.3d at 653)); United Emp. Assocs., 2024 WL
4988982, at *10 (same). Here, the Court has personal jurisdiction over FellowShip and Milliard
Enterprises based on the forum selection clause and the stipulation that they signed. However, in
order to determine whether Chaim and Shani Gross can be considered alter egos of either of these
two corporate entities, the Court needs to first determine whether grounds exist to pierce the
corporate veil for jurisdictional purposes.

i. Applicable Law on Veil Piercing
“[V]eil piercing for jurisdictional purposes is substantive where, to retain personal
jurisdiction over one defendant, as the alter ego of another, would mean subjecting that defendant
to potential liability that it would not otherwise face.” Id. at *4. Therefore, the Court applies
principles from state law.8

8 As discussed above, see supra note 2, the parties did not conduct a choice-of-law analysis in their
briefing. Defendants Chaim and Shani Gross assumed that Pennsylvania’s law on veil piercing
applies. See ECF No. 109-1 at 10–11; ECF No. 110-1 at 11–12. Meanwhile, Plaintiff cited to a
case from the Eastern District of Pennsylvania that discusses two elements from New Jersey’s law
on veil piercing. See ECF No. 123 at 19 (citing Millard v. Yassen Assocs., LLC, No. 22-cv-694,
2022 WL 17093936, at *4 (E.D. Pa. Nov. 21, 2022)). However, Plaintiff then appears to have
referenced and applied the ten factors that courts in the Eastern District of Pennsylvania look to
Under Pennsylvania law, the corporate form may be disregarded if a plaintiff can
demonstrate that the corporate veil should be pierced. See Ashley v. Ashley, 393 A.2d 637, 641
(Pa. 1978) (“[W]henever one in control of a corporation uses that control, or uses the corporate
assets, to further his or her own personal interests, the fiction of the separate corporate identity

may properly be disregarded.”); see also In re Dravo LLC-Derivative Claims Against Carmeuse

when evaluating alter ego jurisdiction, such as those articulated in In re Chocolate Confectionary
Antitrust Litigation, 641 F. Supp. 2d 367, 384–85 (M.D. Pa. 2009). See ECF No. 123 at 19–20
(arguing that “the factors discussed above establish that Lakewood [Candies]—the entity jointly
owned by Mr. Gross and Ms. Gross—is operated as a mere instrumentality of its individual
owners”); see also id. at 18 (citing to the ten factors for alter ego jurisdiction). Therefore, Plaintiff
appears to have conflated Pennsylvania and New Jersey law, and it is unclear from Plaintiff’s brief
whether Plaintiff’s position is that New Jersey or Pennsylvania law controls. If Plaintiff’s position
is that New Jersey law applies, then Plaintiff failed to reference the relevant factors for veil piercing
under New Jersey law, such as “gross undercapitalization[,] failure to observe corporate
formalities, [and] non-payment of dividends,” among others. See Pasternack v. Klein, No. 14-cv-
2275, 2017 WL 10810183, at *8 (E.D. Pa. July 24, 2017) (internal quotations and citation omitted),
aff’d, 751 F. App’x 332 (3d Cir. 2018).

Since none of the parties conducted a choice-of-law analysis and the parties appear to have relied
at least in part on principles from Pennsylvania law, the Court will apply Pennsylvania law for the
Motions to Dismiss. The Court reiterates that they have “waived any objection to that choice of
law by failing to make” any argument regarding it. Shuker, 885 F.3d at 776 n.16.

However, the Court notes that “Pennsylvania choice of law principles” typically instruct a court to
“look to the law of the state in which an entity is incorporated to determine whether a plaintiff may
pierce that entity’s corporate veil[,]” which would suggest that New Jersey’s law on veil piercing
would ordinarily be applied for Milliard Enterprises and California’s law on veil piercing would
ordinarily be applied for FellowShip. McElroy v. FirstEnergy Corp., 824 F. App’x 97, 99 (3d Cir.
2020); see also Commonwealth v. Golden Gate Nat’l Senior Care LLC, 158 A.3d 203, 236 (Pa.
Commw. Ct. 2017) (noting that “[u]nder Pennsylvania law, the existence and extent of shareholder
liability . . . is determined by the law of the state of incorporation[,]” so the law of the state of
incorporation also governs veil piercing), aff’d in part, rev’d in part sub nom., Commonwealth ex
rel. Shapiro v. Golden Gate Nat’l Senior Care LLC, 194 A.3d 1010 (Pa. 2018).

Moving forward in this action, all counsel are instructed to conduct a better and more
comprehensive analysis of the relevant law in their briefing, so that the legal issues that the parties
seek a ruling on from the Court are more clearly set forth. Overall, the briefing for the Motions to
Dismiss has not met the standards that are expected in the Eastern District of Pennsylvania, and
would not be acceptable at the Third Circuit level.
Lime, Inc., 357 A.3d 104, 118 (Pa. 2026) (“[W]hen persons and entities establish corporations or
LLCs, they are not free to blur the lines of the capacity in which they act as it may suit them”
(internal quotations and citation omitted)). As relevant here, “[w]hen a court is faced with
determining whether the equitable doctrine of veil piercing is available to a plaintiff,” the court

uses as a starting point “the general rule that the corporate entity should be recognized and upheld,
unless specific, unusual circumstances call for an exception.” Id. (internal quotations and citation
omitted). In Pennsylvania, “there is a strong presumption . . . against piercing the corporate veil.”
Lumax Indus., Inc. v. Aultman, 669 A.2d 893, 895 (Pa. 1995).
The Supreme Court of Pennsylvania has endorsed “a two-part standard for evaluating
whether a plaintiff can pierce a corporation’s veil of protection[.]” In re Dravo LLC-Derivative
Claims Against Carmeuse Lime, Inc., 357 A.3d at 119. “First, there must be such unity of interest
and ownership that the separate personalities of the corporation and the individual no longer exist,
and second, adherence to the corporate fiction under the circumstances would sanction fraud or
promote injustice[.]” Mortimer v. McCool, 255 A.3d 261, 286–87 (Pa. 2021) (internal quotations

and citation omitted). There are various factors that are relevant in guiding the veil piercing
inquiry, including “undercapitalization, failure to adhere to corporate formalities, substantial
intermingling of corporate and personal affairs[,] and use of the corporate form to perpetrate a
fraud.” Id. at 278 (internal quotations and citation omitted). In addition, an owner of a corporation
can still be held liable for the acts of a corporation “without a specific finding of fraud, in
circumstances including wherever equity requires that such be done either to prevent fraud,
illegality[,] or injustice[,] or when recognition of the corporate entity would defeat public policy
or shield someone from public liability for crime.” Carmen Enters., Inc. v. Carpenter, No. 2151
EDA 2023, 2025 WL 46741, at *5 (Pa. Super. Ct. Jan. 8, 2025) (internal quotations and citation
omitted).
ii. Veil Piercing Is Not Warranted Against Shani Gross
As to Shani Gross, Plaintiff did not allege that she was an owner of FellowShip or Milliard

Enterprises, or that she was involved in the operation of those corporate entities. In addition,
Plaintiff did not present any evidence indicating that Shani Gross intermingled her personal affairs
and accounts with those of FellowShip or Milliard Enterprises, or that she was using either entity
“to perpetrate a fraud.” Mortimer, 255 A.3d at 278 (internal quotations and citation omitted). The
record before the Court does not support piercing the corporate veil against Shani Gross for
jurisdictional purposes, so the Court cannot exercise personal jurisdiction over Shani Gross
pursuant to an alter ego theory.
iii. Veil Piercing Is Not Warranted Against Chaim Gross
Piercing the corporate veil against Chaim Gross, who “owns a 75% interest in FellowShip”
and “is the 100% owner of Milliard [Enterprises,]” is a closer call. ECF No. 78 ¶ 38(a), (d).

However, Plaintiff likewise failed to satisfy its burden of making a prima facie showing that veil
piercing is warranted with respect to Chaim Gross, even under the “less onerous standard” of
piercing for jurisdictional, as opposed to liability purposes. Sugartown Worldwide LLC, 129 F.
Supp. 3d at 205 (internal quotations and citation omitted).
First, there are no allegations that FellowShip and Milliard Enterprises were grossly
undercapitalized, though Plaintiff did allege that FellowShip and Milliard Enterprises have now
“both gone out of business” and “currently have no significant assets.” ECF No. 78 ¶¶ 58–59.
Moreover, “a judgment in excess of $30 million has been entered against FellowShip and
Lakewood Candies in a California state court action.” Id. ¶ 58. Accordingly, while the Court can
reasonably infer that the two entities may have been undercapitalized, there is not conclusive
evidence demonstrating as much. See Arrowhead Conveyor Corp. v. Giuseppe’s Finer Foods,
Inc., Nos. 309 WDA 2019 & 351 WDA 2019, 2020 WL 1460815, at *10 (Pa. Super. Ct. Mar. 24,
2020) (“It is not fraudulent for investors to take reasonable, legal steps to wind down a failing

business venture.”).
Second, there is some indication that FellowShip and Milliard Enterprises failed to properly
“adhere to corporate formalities.” Mortimer, 255 A.3d at 278 (internal quotations and citation
omitted). For example, Plaintiff alleged that FellowShip and Milliard Enterprises “have used the
same set of shipping accounts and subaccounts” and that FellowShip and Milliard Enterprises
shared the same set of documents. ECF No. 78 ¶¶ 50, 56; see also id. ¶ 53. Plaintiff further alleged
on “information and belief” that FellowShip and Milliard Enterprises “do not properly document
transactions between each other or compensate each other for services provided or assets
transferred between one another[,]” and “have shared the same bank accounts with one another
and comingled funds.” Id. ¶¶ 51–52. Assuming the truth of Plaintiff’s factual allegations for the

purpose of resolving Defendants’ Motions to Dismiss, it appears that corporate formalities may
not have always been observed among the various entities that Chaim Gross owns. However,
Plaintiff did not bolster these allegations with evidence, which is striking given that FellowShip
and Milliard Enterprises have been in this litigation from the start and extensive discovery has
already been conducted as to these entities. Even if Plaintiff had supplied evidence, FellowShip’s
and Milliard Enterprises’ alleged failures to adhere to corporate formalities does not in and of itself
demand veil piercing. Indeed, the Third Circuit has observed that “[n]ot every disregard of
corporate formalities or failure to maintain corporate records justifies piercing the corporate veil.”
Kaplan v. First Options of Chi., Inc., 19 F.3d 1503, 1521 (3d Cir. 1994).
Third, Plaintiff failed to allege or to present evidence demonstrating that there was a
“substantial intermingling of corporate and personal affairs.” Mortimer, 255 A.3d at 278 (internal
quotations and citation omitted) (emphasis added). Plaintiff did not allege that Chaim Gross signed
the Agreement between Plaintiff, FellowShip, and Milliard Enterprises that is now in dispute. See

ECF No. 78 ¶ 21; see also Juarez v. Jeune Invs., LLC, No. 2256 EDA 2024, 2025 WL 2631623,
at *11 (Pa. Super. Ct. Sept. 12, 2025) (finding veil piercing was warranted against an individual in
part because he “consistently” did not “maintain separation between the LLC and [himself] as [an]
individual[]” and signed agreements “individually and without referencing” the LLC or his “role[]
within the LLC”). Moreover, Plaintiff did not point to any evidence showing that Chaim Gross
siphoned or diverted funds from FellowShip or Milliard Enterprises for his personal benefit, loaned
personal funds to these entities, or substantially intermingled his personal assets and bank accounts
with theirs. See Carmen Enter., Inc., 2025 WL 46741, at *5 (“[W]henever one in control of a
corporation uses that control, or uses the corporate assets, to further his or her own personal
interests, the fiction of the separate corporate identity may properly be disregarded.” (internal

quotations and citation omitted)). In its Opposition, Plaintiff notes that it “recently received over
3,400 pages of bank records showing that funds were transferred from Lakewood [Candies’]
account to Mr. Gross personally, as well as to ‘Chaim Gross & Shani.’” ECF No. 123 at 24–25.9
But those bank records are not before the Court, and Plaintiff does not contend that there are any
records showing a transfer from FellowShip and Milliard Enterprises to Chaim Gross, such that
he was “us[ing] the assets of [these LLCs] as if they were his own.” Carmen Enter., Inc., 2025
WL 46741, at *6 (internal quotations and citation omitted).

9 The “subpoenaed bank records” that Plaintiff references in its Opposition briefs, see ECF No.
136 at 15; ECF No. 123 at 24, have been the subject of motions to quash. See ECF Nos. 122, 142,
144.
Finally, Plaintiff alleged that Chaim Gross “engaged in corporate wrongdoing by using
intentionally deceptively similar names for multiple corporate entities” to sow confusion with third
parties. ECF No. 78 ¶ 87. According to Plaintiff, this “confusion was deliberate, intentional, and
wrongful[,]” and was done “to avoid . . . contractual obligations and defraud creditors.” Id. ¶ 88;

see also id. ¶ 98 (“Chaim Gross transferred FellowShip’s and Milliard[] [Enterprises’] assets
through a series of shell companies . . . to avoid obligations to Plaintiff and other creditors”). There
are thus some facts suggesting that Chaim Gross was “misusing the corporate form,” but those
facts are likewise not supported by evidence. Mortimer, 255 A.3d at 278.
On balance and “tread[ing] lightly[,]” see id., a consideration of the Mortimer factors
articulated above does not lead the Court to the conclusion that there was “such unity of interest
and ownership that the separate personalities of” FellowShip, Milliard Enterprises, and Chaim
Gross “no longer exist.” Id. at 286–87 (internal quotations and citation omitted). The Court finds
that piercing the corporate veil for the sake of establishing personal jurisdiction over Chaim Gross
through an alter ego theory is not warranted under these circumstances.

5. Single Enterprise Theory
Finally, in its FAC, Plaintiff asserted a single enterprise theory against FoamTex as a
purported basis for exercising personal jurisdiction. See ECF No. 78 ¶ 16.10 However, in its
Opposition, Plaintiff failed to develop an argument as to how the Court can exercise personal

10 Plaintiff also alleged that this Court can exercise personal jurisdiction over Chaim Gross, Shani
Gross, and Simcha Newmark under a single enterprise theory. See ECF No. 78 ¶ 17. However,
in its Opposition briefs, Plaintiff did not argue that the single enterprise theory applies to Chaim
and Shani Gross, or to Simcha Newmark as a basis to assert personal jurisdiction, so it has
abandoned its single enterprise theory as to those Defendants for jurisdictional purposes. See
Dreibelbis, 274 F. App’x at 185; see also ECF No. 145 at 18 (“Plaintiff does not seek to hold Mr.
Newmark liable for FellowShip’s or Milliard[] [Enterprises’] breach of the Agreement under a
veil-piercing or single-enterprise theory”).
jurisdiction over an out-of-state defendant pursuant to this theory. Instead, Plaintiff mentions only
in passing that FoamTex, FellowShip, and Milliard Enterprises “are operated as a single
enterprise” in connection with its arguments regarding the closely related parties doctrine. See
ECF No. 123 at 16. Elsewhere in its briefing, Plaintiff contends that “FoamTex is liable under a

theory of single enterprise liability” and discusses that theory of liability in more detail in
connection with Defendants’ Rule 12(b)(6) Motions to Dismiss for failure to state a claim. See id.
at 21–23; see also id. at 3 (“The breach of contract claim is plausibly alleged against FoamTex and
Mr. Gross under a theory of single enterprise liability”); id. at 12 (“It also alleges that Lakewood
Candies, FoamTex, and Chaim Gross are liable for the actions of Fellow[S]hip and Milliard under
a theory of single enterprise liability.”); id. at 23 (“[T]he FAC adequately establishes that FoamTex
is liable on a single enterprise theory”).
Accordingly, because Plaintiff has not presented any authority or argument as to how this
Court can exercise personal jurisdiction over FoamTex based on a single enterprise theory, the
Court finds that Plaintiff has forfeited that theory to the extent it was asserted as a basis for personal

jurisdiction. See DLJ Mortg. Cap., Inc., 167 F.4th at 635 (“[W]hen a litigant raises an argument
‘in passing (such as, in a footnote)’ but fails to ‘squarely argue[]’ it, we consider it a forfeiture”
(quoting Kalu v. Spaulding, 113 F.4th 311, 344 n.21 (3d Cir. 2024))).
* * *
In sum, Plaintiff failed to sufficiently demonstrate that this Court can exercise personal
jurisdiction over Defendants Chaim Gross, Shani Gross, FoamTex, and Simcha Newmark
consistent with the Due Process Clause. Therefore, the Court will grant Chaim Gross’, Shani
Gross’, FoamTex’s, and Simcha Newmark’s Motions to Dismiss for lack of personal jurisdiction
(ECF Nos. 109, 110, 111, 132), and will dismiss the claims asserted against Chaim Gross, Shani
Gross, FoamTex, and Simcha Newmark without prejudice.11
If Plaintiff still seeks to pursue claims against these individuals and corporate entity,
Plaintiff may do so in a court that has jurisdiction over them. However, leave to amend will not

be granted. Given the unusual posture of this case, Plaintiff had a significant amount of discovery
available to it at the time that it amended its Complaint, some of which may have pertained to
jurisdiction. Moreover, Plaintiff has not argued that Chaim Gross, Shani Gross, Simcha Newmark,
or FoamTex are necessary parties to this litigation. Under the circumstances of this case, the Court
finds that leave to amend would be “futile,” as Plaintiff has not provided the Court with any
indication that the jurisdictional deficiencies discussed at length are curable by an additional round
of amendment. See Grayson v. Mayview State Hosp., 293 F.3d 103, 108 (3d Cir. 2002); see also
Jablonski v. Pan Am. World Airways, Inc., 863 F.2d 289, 292 (3d Cir. 1988) (explaining that
amendment of a complaint is futile when it “will not cure the deficiency in the original complaint
or if the amended complaint cannot withstand a renewed motion to dismiss”); United Emp. Assocs.,

2024 WL 4988982, at *13 (finding that leave to amend the claims asserted against a defendant
“would be futile” where the court “lack[ed] personal jurisdiction over” that defendant).

11 Because the Court is granting Chaim Gross’, Shani Gross’, and FoamTex’s Rule 12(b)(2)
Motions to Dismiss, the Court need not address these Defendants’ Rule 12(b)(3) and Rule 12(b)(6)
Motions. Similarly, because the Court is granting Simcha Newmark’s Rule 12(b)(2) Motion to
Dismiss, the Court need not address Newmark’s Rule 12(b)(3), Rule 12(b)(5), and Rule 12(b)(6)
Motions.

In two sentences of its Opposition to Simcha Newmark’s Motion to Dismiss, Plaintiff requested
“limited jurisdictional discovery.” See ECF No. 145 at 4, 19. But Plaintiff did not provide any
argument as to why jurisdictional discovery is warranted and whether the relevant standard for
granting jurisdictional discovery has been satisfied. See, e.g., Toys “R” Us, Inc. v. Step Two, S.A.,
318 F.3d 446, 456 (3d Cir. 2003). Accordingly, the Court will not order jurisdictional discovery
as to Simcha Newmark under these circumstances.
Defendants SmartShipped, Samuel Greenwald, and Yaakov Landsman did not move to
dismiss Plaintiff’s FAC for lack of personal jurisdiction. See ECF No. 115. Under Rule 12(h)(1),
they have thus waived the defense of lack of personal jurisdiction, so the Court will proceed to
consider their Motions to Dismiss for failure to state a claim. See Fed R. Civ. P. 12(h)(1); see also

Burger King Corp., 471 U.S. at 472 n.14 (explaining that personal jurisdiction “is a waivable
right”).
B. Merits: Count III
Defendants SmartShipped, Samuel Greenwald, and Yaakov Landsman filed Motions to
Dismiss pursuant to Rule 12(b)(6). Plaintiff did not assert Counts I or II against these three
Defendants, so the Court begins its analysis with Count III, an alleged violation of the PUVTA.
Although Plaintiff initially asserted Count III against all Defendants, see ECF No. 78 ¶¶ 96–102,
Plaintiff now states that it is “voluntarily withdraw[ing] Count III” against both Samuel Greenwald
and Yaakov Landsman without prejudice. ECF No. 136 at 4, 16. The Court will thus dismiss
Count III against Greenwald and Landsman without prejudice, and need only evaluate whether

Plaintiff stated a plausible claim for a violation of the PUVTA against SmartShipped.
The PUVTA provides that “a transfer made or obligation incurred by a debtor is voidable
as to a creditor” when certain conditions are met. 12 Pa. Cons. Stat. § 5104. The statute contains
different provisions regarding liability for a fraudulent transfer depending on whether a plaintiff is
asserting an actual or constructive fraud theory. Id. § 5104(a)(1)–(2).
With respect to actual fraud, in order to void a transfer under Section 5104(a)(1), a plaintiff
must allege facts demonstrating that “the debtor made the transfer or incurred the obligation . . .
with actual intent to hinder, delay or defraud any creditor of the debtor.” Id. § 5104(a)(1). On
occasion, a plaintiff may present direct evidence of a debtor’s “‘actual intent to hinder, delay or
defraud’” a creditor. Eddystone Rail Co., LLC v. Bridger Logistics, LLC, No. 17-cv-00495, 2024
WL 3090882, at *36 (E.D. Pa. June 21, 2024) (quoting 12 Pa. Cons. Stat. § 5104(a)(1)), appeal
dismissed, Nos. 24-2239 & 24-2284, 2025 WL 2048326 (3d Cir. Jan. 22, 2025). “[I]n the absence
of direct evidence,” the PUVTA identifies various factors or “badges of fraud” a plaintiff may rely

on as circumstantial evidence in supporting an actual fraud claim. Id. For example, some of the
badges of fraud include considerations of whether: “the transfer or obligation was to an insider;”
“the debtor retained possession or control of the property transferred after the transfer;” or “the
transfer or obligation was disclosed or concealed.” 12 Pa. Cons. Stat. § 5104(b)(1)–(3). The list
of factors enumerated in § 5104(b) is not exhaustive, nor is any one combination sufficient to
establish actual fraud. See Chestnut St. Consol., LLC v. Dawara, 619 F. Supp. 3d 489, 506–07
(E.D. Pa. 2022) (“No particular badge is necessary, nor is any combination sufficient; finding
intent is always fact specific.” (internal quotations and citation omitted)); cf. In re C.F. Foods,
L.P., 280 B.R. 103, 109 (Bankr. E.D. Pa. 2002) (“The plain language of § 5104(b) clearly provides
that other factors, beyond those listed, can be considered in determining whether a transfer was

made with actual intent to defraud. Therefore, even in the absence of any of the enumerated
badges, a court can find actual fraud.”).
With respect to constructive fraud, in order to void a transfer under Section 5104(a)(2), a
plaintiff must allege facts demonstrating that “the debtor made the transfer or incurred the
obligation . . . without receiving a reasonably equivalent value in exchange for the transfer or
obligation.” 12 Pa. Cons. Stat. § 5104(a)(2). In addition, a plaintiff is required to plead facts
demonstrating the debtor either (1) “was engaged or was about to engage in a business or a
transaction for which the remaining assets of the debtor were unreasonably small in relation to the
business or transaction; or” (2) “intended to incur, or believed or reasonably should have believed
that the debtor would incur, debts beyond the debtor’s ability to pay as they became due.” Id. §
5104(a)(2)(i)–(ii).
Furthermore, the Superior Court of Pennsylvania has interpreted the PUVTA to “require[]
the plaintiff to prove the ‘transfer’ of an ‘asset’ to establish that any statutory relief applies.” TD

Bank, N.A. v. Andreasyan, No. 1722 EDA 2023, 2024 WL 4297802, at *5 (Pa. Super. Ct. Sept. 26,
2024). The statute defines an “[a]sset” as the “[p]roperty of a debtor[,]” and defines “[t]ransfer”
as “[e]very mode, direct or indirect, absolute or conditional, voluntary or involuntary, of disposing
of or parting with an asset or an interest in an asset[,]” including “payment of money, release,
lease, license and creation of a lien or other encumbrance.” 12 Pa. Cons. Stat. § 5101(b).
While a plaintiff is required to adhere to a heightened standard of pleading under Federal
Rule of Civil Procedure 9(b) in alleging actual fraud, caselaw suggests that the heightened pleading
standard in Rule 9(b) is inapplicable to causes of action alleging constructive fraudulent transfer.
See, e.g., Agri-Mktg., Inc. v. ProTerra Sols., LLC, No. 17-cv-00627, 2018 WL 1444167, at *9
(E.D. Pa. Mar. 22, 2018) (finding that actual fraud is “analyzed under Rule 9(b), whereas

[constructive fraud] is required only to meet the demands of Rule 8”); In re Forks Specialty Metals
Inc., Bankr. No. 17-18061, Adversary No. 19-00028, 2023 WL 3239468, at *20–22 (Bankr. E.D.
Pa. Apr. 30, 2023) (“Claims of actual fraud are evaluated under Federal Rule of Civil Procedure
9(b) . . . [whereas] [c]laims asserting a constructively fraudulent transfer must meet the more
relaxed plausibility pleading standard of Federal Rule of Civil Procedure 8(a).”); 7301 Penn Ave.,
LLC v. ChemImage Corp., No. 23-cv-1836, 2024 WL 4349199, at *1 (W.D. Pa. Sept. 30, 2024)
(same).
With this framework in mind, the Court turns to the allegations against SmartShipped.
Although Plaintiff did not specify in its FAC which statutory provision it was proceeding under, it
appears to have alleged both actual and constructive fraud theories, see ECF No. 78 ¶¶ 99–100,
and the parties made arguments concerning both in their briefing.
1. Plaintiff Failed to State a PUVTA Claim Against SmartShipped
In support of its PUVTA claim, Plaintiff alleged that it “has a right to payment from

FellowShip and/or Milliard [Enterprises],” but has not been paid in full yet. Id. ¶ 97. Nevertheless,
“[w]ithout Plaintiff’s knowledge or consent, Chaim Gross transferred FellowShip’s and Milliard[]
[Enterprises’] assets through a series of shell companies, such as Lakewood [Candies], FoamTex,
and SmartShipped, owned and controlled by Mr. Gross and/or other individual Defendants in order
to avoid obligations to Plaintiff and other creditors.” Id. ¶ 98. Plaintiff further alleged that those
transfers “were made without benefit or valuable consideration to FellowShip or Milliard
[Enterprises]” and, as a result, both “FellowShip and Milliard [Enterprises] have become
insolvent.” Id. ¶¶ 99, 101. In making these transfers, “Mr. Gross and the other Defendants acted
with the intent to hide assets, hinder recovery, or move such assets beyond the reach of Plaintiff
or other creditors[,]” resulting in a violation of the PUVTA. Id. ¶ 100.

In addition, in its Opposition, Plaintiff argues that it “allege[d] a claim for actual fraudulent
transfer against SmartShipped” by means of its “allegations that Fellow[S]hip’s clients, business,
and software product were transferred to SmartShipped.” ECF No. 136 at 13 (citing ECF No. 78
¶¶ 70–72). Plaintiff also points the Court to allegations that purportedly correspond to various
badges of fraud enumerated in Section 5104(b). Id. at 14.
As discussed above, in order for Plaintiff to plead a violation of the PUVTA, Plaintiff
needed to identify a purported “‘transfer’ of an ‘asset.’” TD Bank, N.A., 2024 WL 4297802, at *5.
Upon a close review of Plaintiff’s FAC, the only substantive factual allegation of a “transfer”
involving SmartShipped is the allegation that “clients of FellowShip were transferred over to
SmartShipped, who is now servicing them.” ECF No. 78 ¶ 70. Pennsylvania courts have
recognized a property interest in proprietary client lists and other client-related information. See,
e.g., Bohler-Uddeholm Am., Inc. v. Ellwood Grp., Inc., 247 F.3d 79, 107 (3d Cir. 2001)
(“‘[C]ustomer lists and customer information . . . [are] highly confidential and constitute[] a

valuable asset. Such data has been held to be property in the nature of a “trade secret” for which
an employer is entitled to protection, independent of a non-disclosure contract.’” (quoting
Robinson Elec. Supervisory Co. v. Johnson, 154 A.2d 494, 496 (Pa. 1959))); McCarthy & Co.,
Inc. v. Pollen, Nos. 2254 EDA 2023 & 943 EDA 2024, 2025 WL 1743726, at *2 (Pa. Super. Ct.
June 24, 2025) (describing “confidential and proprietary information” as “including client lists,
client contracts, client tax returns, [and] client financial statements”), appeal granted, 353 A.3d
180 (Pa. 2026) (per curiam). But this has not been extended to viewing clients themselves as
something that a business can have a property interest in, nor did Plaintiff identify any cases in
which Pennsylvania courts have held that clients can be considered “assets.” Plaintiff did not
otherwise allege in its FAC that client lists or other proprietary information about FellowShip’s

clients were transferred to SmartShipped. Therefore, Plaintiff’s allegation that “clients of
FellowShip were transferred over to SmartShipped” cannot sustain a claim for a violation of the
PUVTA against SmartShipped. ECF No. 78 ¶ 70.
As to other allegations involving SmartShipped, none suffice to support a purported
violation of the PUVTA. Plaintiff alleged that SmartShipped “provides the same or very similar
services to those FellowShip provided[,]” some employees worked for both companies, “FoamTex
acquired” FellowShip’s software product, ScanShip, “without any compensation,” and
“SmartShipped now offers that software to customers.” Id. ¶¶ 71, 72. These allegations do not
contain any mention of a “transfer” of FellowShip’s software to SmartShipped, such as a “payment
of money, release, lease, license and creation of a lien or other encumbrance” in exchange for the
software. 12 Pa. Cons. Stat. § 5101(b). And the fact that “SmartShipped now offers” ScanShip to
its customers is, on its own, insufficient to show that the software was transferred to SmartShipped.
ECF No. 78 ¶ 72; see also TD Bank, N.A., 2024 WL 4297802, at *5 (“[T]o be eligible for relief

under section 5104, a plaintiff must first establish that there was a ‘transfer’ of an ‘asset’ that
applies.” (quoting 12 Pa. Cons. Stat. § 5104)). By contrast, Plaintiff expressly alleged that
“Lakewood Candies owned the rights to a software product, ScanShip, which it decided to give to
FellowShip free of charge” and that “Fellow[S]hip then in turn granted a ‘perpetual license’ to
FoamTex to access and use the software without paying anything of value to Lakewood Candies.”
ECF No. 78 ¶ 51; see also id. ¶ 72 (alleging that “FoamTex acquired ownership of FellowShip’s
software product, ScanShip, without any compensation”). Here, Plaintiff failed to allege that any
transfer of software to SmartShipped actually took place, and did not allege any facts regarding
that transfer, including when or how it occurred. Therefore, the allegations about FellowShip’s
software cannot support a claim against SmartShipped for a purported violation of the PUVTA.

Next, Plaintiff’s generalized allegations that “the transfer of Defendants’ business and
assets to FoamTex and SmartShipped has left the other entity defendants insolvent” are also
insufficient to state a claim. Id. ¶ 73; see also id. ¶ 74 (“Upon information and belief,
SmartShipped and the other entity Defendants did not properly document transactions between
each other or compensate each other for services provided or assets transferred amongst each
other.”); id. ¶ 98 (“Chaim Gross transferred FellowShip’s and Milliard[] [Enterprises’] assets
through a series of shell companies, such as Lakewood, FoamTex, and SmartShipped, owned and
controlled by Mr. Gross and/or other individual Defendants in order to avoid obligations to
Plaintiff and other creditors.”); id. ¶ 104 (same). These conclusory allegations are devoid of facts
demonstrating any actual transfer of a specific asset to SmartShipped occurred.
For these reasons, Plaintiff has failed to plead adequate facts establishing that an asset was
transferred to SmartShipped within the meaning of the PUVTA. Accordingly, Plaintiff has not

stated a plausible PUVTA claim against SmartShipped, and the Court will dismiss Count III
against SmartShipped.
Plaintiff requested leave to amend on the basis that it can “supply further facts once it fully
analyzes Defendants’ subpoenaed bank records.” ECF No. 136 at 15. “That argument, of course,
puts the cart before the horse.” Levey v. Brownstone Inv. Grp., LLC, 590 F. App’x 132, 137 (3d
Cir. 2014). Plaintiff “may not attempt to use discovery as a fishing expedition to determine”
whether a transfer of an asset occurred and “to seek out the facts necessary to establish a legally
adequate complaint.” White v. Hon Co., 520 F. App’x 93, 95 (3d Cir. 2013). Indeed, the Third
Circuit has cautioned against providing plaintiffs with an “opportunity ‘to conduct a fishing
expedition in order to find a cause of action.’” Levey, 590 F. App’x at 137 (quoting Ranke v.

Sanofi-Sythelabo Inc., 436 F.3d 197, 204 (3d Cir. 2006)); see also Twombly, 550 U.S. at 556
(requiring a plaintiff to plead “enough fact[s] to raise a reasonable expectation that discovery will
reveal evidence” of its claims); Iqbal, 556 U.S. at 686 (“Because respondent’s complaint is
deficient under Rule 8, he is not entitled to discovery, cabined or otherwise.”); Bergin v. Teamsters
Loc. Union No. 77, No. 10-cv-2289, 2011 WL 486230, at *2 (E.D. Pa. Feb. 4, 2011) (“‘[F]ishing
expeditions’ to seek out the facts needed to bring a legally sufficient complaint are barred by the
pleading clarifications in Iqbal and Twombly.”). This is why motions to dismiss are generally
resolved before any discovery begins in a case. Levey, 590 F. App’x at 137. However, given the
unique procedural posture of the case, there has already been substantial discovery into
FellowShip’s documents. Yet despite the extensive record that Plaintiff had at its fingertips,
Plaintiff failed to state a plausible PUVTA claim against SmartShipped, even though Plaintiff’s
claim was centered around conclusory allegations that FellowShip’s assets were transferred to
SmartShipped. Under the circumstances of this case, the Court finds that amendment of Count III

as to SmartShipped would be “futile.” Grayson, 293 F.3d at 108. Accordingly, the Court will
deny leave to amend and will dismiss Count III against SmartShipped with prejudice.
C. Merits: Count IV
Finally, the Court turns to Defendants SmartShipped’s, Samuel Greenwald’s, and Yaakov
Landsman’s Motions to Dismiss Count IV pursuant to Rule 12(b)(6). Plaintiff initially asserted a
cause of action for “Aiding and Abetting” against all Defendants, see ECF No. 78 ¶¶ 103–06, but
has subsequently withdrawn Count IV against Defendants FellowShip, Milliard Enterprises,
Lakewood Candies, FoamTex, and Chaim Gross. See ECF No. 94 at 3, 26; ECF No. 123 at 26.
Plaintiff maintains its assertion of Count IV against Defendants SmartShipped, Samuel Greenwald,
and Yaakov Landsman.

In its FAC, Plaintiff only identified Count IV as an “Aiding and Abetting” claim without
specifying what the underlying tort that Defendants are alleged to have aided and abetted is. The
Court thus turns to the allegations themselves to shed light on this claim. As to Count IV, Plaintiff
alleged that “Chaim Gross transferred FellowShip’s and Milliard[] [Enterprises’] assets through a
series of shell companies.” ECF No. 78 ¶ 104. Plaintiff further alleged that “all” Defendants
“knew of Mr. Gross’s purpose in transferring such assets away . . . and through receipt of these
assets, Defendants assisted, benefitted, and encouraged Mr. Gross’s fraud and fraudulent transfer.”
Id. ¶ 105. Accordingly, Plaintiff appears to have alleged a claim for aiding and abetting a
fraudulent transfer. In other words, Plaintiff’s aiding and abetting claim is tied to the conduct
underlying Plaintiff’s PUVTA claim.
That is problematic for Plaintiff because several Defendants point out that “no
Pennsylvania court has recognized aiding and abetting a PUVTA violation, and the statute’s closed

remedial scheme forecloses it.” ECF No. 109-1 at 19 (citing 12 Pa. Cons. Stat. §§ 5107, 5108(b));
see also ECF No. 110-1 at 13 (same); ECF No. 111-1 at 19 (same); ECF No. 132-1 at 17 (same).
Moreover, courts in several other states have found that liability for aiding and abetting a
fraudulent transfer is precluded by similar fraudulent transfer statutes. See, e.g., Crystallex Int’l
Corp. v. Petrόleos De Venezuela, S.A., 879 F.3d 79, 89 (3d Cir. 2018) (noting that “[t]he Chancery
Court has foreclosed the possibility of aiding and abetting liability under” the Delaware Uniform
Fraudulent Transfer Act (“DUFTA”) (citing Edgewater Growth Cap. Partners, L.P. v. H.I.G.
Cap., Inc., No. 3601-VCS, 2010 WL 720150, at *2 (Del. Ch. Mar. 3, 2010))); In re Rescue
Rangers, LLC, 756 B.R. 521, 531 (Bankr. E.D. Va. 2017) (noting that a cause of action for “aiding
and abetting fraudulent transfers” does “not exist under federal or Virginia law”); GATX Corp. v.

Addington, 879 F. Supp. 2d 633, 643 (E.D. Ky. 2012) (“[T]he Court believes that Kentucky would
follow the overwhelming majority of states that hold [a] cause of action [for aiding and abetting
fraudulent conveyances] does not exist.”); Mann v. GTCR Golder Rauner, L.L.C., 483 F. Supp. 2d
884, 918 (D. Ariz. 2007) (predicting that the Arizona Supreme Court would not adopt an
“independent cause of action for aiding and abetting a fraudulent transfer under” the Arizona
Uniform Fraudulent Transfer Act); Freeman v. First Union Nat’l Bank, 865 So.2d 1272, 1276
(Fla. 2004) (“There simply is no language in [the Florida Uniform Fraudulent Transfer Act] that
suggests the creation of a distinct cause of action for aiding-abetting claims against non-
transferees.”).
Notably, Plaintiff did not contest this particular argument in its Opposition briefs, and
failed to provide the Court with any clear authority indicating that Pennsylvania already recognizes
or would recognize a cause of action for aiding and abetting a fraudulent transfer. Therefore, the
Court finds that Plaintiff has effectively abandoned any cause of action for aiding and abetting a

fraudulent transfer. See Dreibelbis, 274 F. App’x at 185 (affirming a district court’s finding that
a plaintiff had waived an argument where plaintiff “had ample opportunity to make this argument
in response to defendants’ motion to dismiss and failed to do so”); Levy-Tatum v. Navient Sols.,
Inc., 183 F. Supp. 3d 701, 712 (E.D. Pa. 2016) (“This Court has previously treated a plaintiff’s
failure to address a defendant’s arguments for dismissal as an abandonment.” (collecting cases));
Jac

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/11423782. Public record. Not legal advice.