Ent. Rent-A-Car Wage & Hour Emp. Practices Lit.

MEMORANDUM OPINION

CONTI, District Judge.

Pending before this court are two motions filed by defendant Enterprise Rent-A-Car Company

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(“ERAC-Missouri” or “defendant parent”). The first is a motion to dismiss the amended master complaint with respect to claims asserted against defendant parent. (Docket No. 65, Misc. No. 09-210.) The second is a motion seeking summary judgment in favor of defendant parent on joint employer issues. (Docket No. 124.)

J.

Procedural Background

The issues raised in the motion to dismiss the amended master complaint were briefed in connection with two motions to dismiss, stay, or transfer, which, on November 6, 2009, were dismissed without prejudice due to the filing on September 18, 2009 of the amended master complaint (Docket No. 35).

The first motion to dismiss, stay, or transfer (Docket No. 12, Civ. No. 07-1687) was filed by defendants ERAC-Missouri and Enterprise Rent-A-Car Company of Pittsburgh

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(“ERAC-Pittsburgh,” and together with ERAC-Missouri, “Hickton defendants”). The movant sought to dismiss, stay, or transfer the claims set forth in the complaint (Docket No. 1) filed by Niekolas C. Hickton (“Hickton”), on behalf of himself and all others similarly situated. The motion alleged, inter alia, that this court lacks personal jurisdiction over ERACMissouri and asked for the claims against ERAC-Missouri to be dismissed. After a hearing on April 23, 2008, the court ordered a stay, among other things, of all claims against ERAC-Missouri, due to a prior pending action against ERAC-Missouri in the United States District Court for the Eastern District of Missouri,

Zaba

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dy v. Enterprise Rent-A-Car Co.,

No. 4:07-CV-04494 (E.D.Mo.). (Docket No. 39.)

In a letter submitted on September 15, 2008, Hickton informed the court that all collective action claims were dismissed in

Zabady. (See

Docket No. 48.) In response, Hickton defendants submitted a letter on October 10, 2008. (Docket No. 48.) In the letter, Hickton defendants argued that the stayed portions of the lawsuit cannot proceed because the court lacks personal jurisdiction over ERACMissouri and that the claims against ERAC-Missouri should be dismissed or transferred to the United States District Court for the Eastern District of Missouri.

(Id.)

Following a status conference on October 15, 2008, this court ordered the parties to brief the issue whether personal jurisdiction exists over ERAC-Missouri. On April 10, 2009, Hickton submitted a memorandum of law in support of this court’s exercise of personal jurisdiction. (Docket No. 63.) On May 8, 2009, Hickton defendants filed a memorandum of law in opposition to the exercise of personal jurisdiction and in further support of ERACMissouri’s motion to dismiss. (Docket No. 80.) On May 27, 2009, Hickton filed a reply memorandum of law. (Docket No. 93.)

The second motion to dismiss, stay, or transfer (Docket No. 18, Civ. No. 09-832) was filed on September 29, 2008 in

Averill v. Enterprise Rent-A-Car Co.,

No. 1:08-cv-04191 (N.D.Ill), by defendant ERACMissouri. The motion sought to dismiss for lack of jurisdiction, stay, or transfer to the United States District Court for the Eastern District of Missouri the complaint of plaintiff Michael Keith Averill (“Averill,” and together with Hickton and the other plaintiffs in the consolidated actions, “plaintiffs”). (Docket No. 6.) On November 3, 2008, Averill filed a response to ERAC-Missouri’s motion to dismiss, stay, or transfer (Docket No. 32), raising arguments similar to those raised in the

Hick-ton

case. ERAC-Missouri filed a reply memorandum in support of the motion to dismiss, stay, or transfer on December 1, 2008. (Docket No. 40.)

On June 10, 2009, 626 F.Supp.2d 1325 (U.S.Jud.Pan.Mult.Lit.2009), the

Hickton

and

Averill

cases, among others, were consolidated by the Judicial Panel on Multidistrict Litigation for pretrial purposes in this court. This court heard oral argument on the two pending motions to dismiss on August 12, 2009. The court ordered subsequent briefing on several issues. On September 14, 2009, ERACMissouri filed a supplemental brief on personal jurisdictional matters (Docket No. 30), and plaintiffs filed a supplemental memorandum of law in support of this court’s exercise of jurisdiction (Docket No. 31). On October 5, 2009, ERAC-Missouri filed a reply to plaintiffs’ supplemental memorandum of law (Docket No. 50), and plaintiffs filed a response to ERAC-Missouri’s supplemental jurisdictional brief (Docket No. 51).

Hickton and Averill each filed separate collective actions under the Fair Labor Standards Act of 1938, as amended, 29 U.S.C. §§ 201

et seq.

(“FLSA”), among other claims. Hickton’s action was brought against ERAC-Missouri, its operating subsidiary, ERAC-Pittsburgh, and Does 1 through 10. Hickton’s complaint was filed December 11, 2007 in this district. (Docket No. 1, Civ. No. 07-1687.) Averill’s action was brought only against ERAC-Missouri. Enterprise Leasing Company of Chicago

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(“ELC-Chicago”)

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was ERAC-Missouri’s operating subsidiary at issue in that case. Averill’s complaint was originally filed on July 23, 2008 in the United States District Court for the Northern District of Illinois. (Docket No. 1, Civ. No. 09-832.) Hickton and Averill filed notices of adoption of the amended master complaint with respect to their actions.

(See

Docket Nos. 38, 39, Misc. No. 09-210.) The amended master complaint names as defendants, among others: ERAC-Missouri, ERAC-Pittsburgh, and ELC-Chicago. (Docket No. 35.) Averill’s action is now proceeding against ERACMissouri and ELC-Chicago.

(See

Docket No. 38.)

The motion for summary judgment was filed on February 26, 2010 (Docket No. 124, Misc. No. 09-210). In that motion, ERAC-Missouri argues that, although plaintiffs allege that ERAC-Missouri is a joint employer of plaintiffs under the FLSA, the undisputed facts show that it did not employ plaintiffs. On March 15, 2010, ERAC-Missouri filed a brief in support of the motion (Docket No. 147), an appendix of exhibits (Docket No. 150), and a statement of facts (Docket No. 148). On March 29, 2010, plaintiffs filed a memorandum in opposition to ERAC-Missouri’s motion (Docket No. 154), an appendix of exhibits (Docket No. 155), and a reply statement of facts (Docket No. 153). On April 12, 2010, ERAC-Missouri filed a reply memorandum in support of its motion (Docket No. 162), an additional exhibit (Docket No. 164), and a reply and consolidated statement of facts (Docket No. 163). On May 10, 2010, ERAC-Missouri filed a notice of supplemental authority (Docket No. 168). Plaintiff responded to notice of supplemental authority on May 13, 2010. (Docket No. 170.)

The court originally scheduled oral argument to take place on May 21, 2010 with respect to the motion for summary judgment on joint employer issues, but at that hearing the court ordered additional briefing on several topics. On May 27, 2010, ERAC-Missouri filed a supplemental brief (Docket No. 177), and on May 28, 2010, plaintiffs filed their brief (Docket No. 179) and a declaration of counsel Peter Muhic to which exhibits were attached (Docket No. 180). On June 7, 2010, the court heard oral argument on the issues raised in the motion for summary judgment.

For the reasons explained more fully in this memorandum opinion, the court will deny without prejudice ERAC-Missouri’s motion to dismiss and grant ERAC-Missouri’s motion for summary judgment on joint employer issues.

II. Factual Background

A. ERAC-Missouri

ERAC-Missouri is incorporated under Missouri law and maintains a principal place of business in St. Louis, Missouri. (Ex. 1 ¶ 3 to Hickton defendants’ memorandum of law in opposition to the exercise of personal jurisdiction and in further support of ERAC-Missouri’s motion to dismiss (Docket No. 80, Civ. No. 07-1687) (“Def.’s Br. Hickton”).) At the time these actions were commenced, ERAC-Missouri was the sole shareholder of thirty-eight subsidiaries in the United States that rent and sell vehicles.

4

(Consolidated state

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ment of facts (Docket No. 163) (“C.S.F.”) ¶ 1; appendix of exhibits in support of motion for summary judgment on joint employer issues (Docket No. 150) (“Def.’s App.”), Ex. 1 ¶ 5.) ERAC-Missouri is a subsidiary of The Crawford Group, Inc. (the “Crawford Group”). (Ex. A ¶ 3 to ERAC-Missouri’s reply memorandum in support of the motion to dismiss, stay, or transfer (Docket No. 40, Civ. No. 09-832) (“Def.’s Reply Averill”).)

The Crawford Group is the sole owner of The Crawford Group-Information Systems (“CGIS”). CGIS owned and maintained the “Enterprise brand”

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website, www.enterprise.com. (Id.)

6

The website does not distinguish between ERAC-Missouri and its operating subsidiaries, and the website states that Enterprise RenbA-Car has 878,000 vehicles, 64,000 employees,

7

and 6,900 offices in the United States and other countries. (Ex. R ¶¶ 5, 6 to Hickton’s memorandum of law in support of this court’s exercise of personal jurisdiction (Docket No. 63, Civ. No. 07-1687) (“Pl.’s Br. Hickton”).) Based upon these statistics, Enterprise Renb-A-Car claims on the website that it is the largest rental car company in North America, with a “World Headquarters” in St. Louis, Missouri. (Ex. L to

Pl.’s Br.

Hickton;

see

appendix of exhibits in support of plaintiffs’ memorandum of law in opposition to motion for summary judgment on joint employer issues (Docket No. 155) (“Pis.’ App.”), Ex. 12.) ERAC-Missouri, however, maintains that it has no offices or employees in Pennsylvania or Illinois. (Ex. 1 ¶ 5 to Def.’s Br. Hickton; Ex. D ¶ 6 to ERAC-Missouri’s memorandum of points and authorities in support of ERAC-Missouri’s motion to dismiss, stay, or transfer (Docket No. 20, Civ. No. 09-832) (“Def.’s Br. Averill”).)

ERAC-Missouri does not directly rent or sell vehicles anywhere in the world. (Ex. 1 ¶ 11 to Def.’s Br. Hickton.) Instead, wholly-owned operating subsidiaries of ERAC-Missouri conduct all rental services and vehicle sales.

(Id.

¶ 14.) ERAC-Missouri directly or indirectly supplies each operating subsidiary with administrative services including, but not limited to: business guidelines, employee benefit plans, rental reservation tools like enterprise.com, a customer contact center, insurance, information technology, and legal services.

(Id.

at ¶ 11; Ex. 5 at 46, 227, 239 to Def.’s Br. Hickton.) ERAC-Missouri offers many of these services to the operating subsidiaries at an advantageous price, because ERAC-Missouri achieves

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economies of scale.

(See

Def.’s App., Ex. 2 ¶ 15.) The business guidelines are distributed to the employees of the subsidiaries in a policy manual, titled “Business Ethics Guide, Personnel Policy, and Benefits Summary Plan Description,” that states “Information contained in the Business Ethics Guide, Personnel Policy, and Benefits Summary Plan Description refers to employees of: The Crawford Group, Inc., Enterprise Renb-A-Car Company and their various operating subsidiaries.” (Ex. 13 at P0157 to Averill’s response to defendant’s motion to dismiss, stay, or transfer (Docket No. 32, Civ. No. 09-832) (“Pl.’s Br. Averill”).) Later in the policy manual, the word “employee” is defined as “the person (who is not a dependent) on whose behalf the plan is established. Employees include only the common-law employees of Enterprise.”

(Id.

at P0181.) ERAC-Missouri also authorizes its operating subsidiaries to use the name “Enterprise RenbA-Car” and other registered trademarks. (Ex. Q ¶ 3 to Def.’s Reply Averill.)

Each operating subsidiary remunerated ERAC-Missouri in the form of corporate dividends and management fees. (Ex. 1 ¶ 10 to Def.’s Br. Hickton; Ex. 3 ¶ 10 to Def.’s Br. Hickton; Ex. D ¶ 9 to Def.’s Br. Averill.) The board of directors for each operating subsidiary decided on a quarterly basis whether to pay a dividend to ERAC-Missouri.

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(Ex. I at 11 to Hick-ton’s reply memorandum of law in support of this court’s exercise of personal jurisdiction (Docket No. 93, Civ. No. 07-1687) (“Pl.’s Reply Hickton”).) ERAC-Missouri recognized these dividends as an increase in equity and did not report the dividend on its federal income tax statements.

(Id.)

Likewise, the operating subsidiaries did not take a deduction for dividends paid.

(Id.)

ERAC-Missouri determines annually the amount of management fees to charge each operating subsidiary.

(Id.)

Management fees offset the expenses for services provided by defendant parent to the operating subsidiaries and are recorded as income and reported on ERAC-Missouri’s federal income tax statements.

(Id.)

Since the management fees are considered an ordinary business expense, operating subsidiaries claim a tax deduction for their payment.

(Id.)

B. Administrative Services Offered to Subsidiaries

ERAC-Missouri also wholly owns operating subsidiaries that do not rent or sell vehicles. A financial subsidiary, ERAC USA Finance, serves as the treasury department for ERAC-Missouri and the ERAC operating subsidiaries. (Ex. B at 27 to PL’s Br. Hickton.) ERAC USA Finance’s primary responsibility is to borrow funds from third-party lenders and lend them to the operating subsidiaries for use in their day-to-day business operations.

(Id.)

ERAC-Missouri wholly owns ELCO Administrative Services Co. (“ELCO”), a subsidiary devoted to securing a high level of insurance and facilitating the settlement of liability claims.

(Id.

at 225.) While the rental operating subsidiaries obtain their own insurance for vehicle damage and limited amounts for personal injury claims, the coverage sourced by ELCO is for claims in excess of the individual subsidiary’s coverage.

(Id.

at 227.) The costs for this additional group insurance are divided proportionately and billed directly by ELCO to the individual operating subsidiaries.

(Id.

at 227.)

Prior to January 2008, ERAC-Missouri directly operated a contact center for cus

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tomer support in St. Louis. (Ex. D at 22-23 to Pl.’s Br. Hickton.) In January 2008, ERAC-Missouri reorganized the contact center division into an operating subsidiary.

(Id.

at 22.) The functionality of the contact center as an operating subsidiary is identical to its role as a division of ERAC-Missouri.

(Id.)

Customers call the contact center by dialing a toll-free number that corresponds with the customer’s concern. (Ex. E at 20 to Pl.’s Br. Hick-ton.) One function of the contact center is to allow customers to book vehicle reservations at any of ERAC-Missouri’s operating subsidiaries. (Ex. D at 46 to Pl.’s Br. Hickton.) ERAC-Missouri’s operating subsidiaries refer to the contact center as “National Reservations” or “Nat Res.”

(Id.

at 22.) The contact center also serves as the primary point of contact for ERAC customers needing roadside assistance.

(Id.

at 46.) The contact center’s roadside assistance phone number is on every vehicle rental contract throughout the ERAC vehicle rental network.

(Id.

at 47-48.) The phone services and systems utilized by the contact centers are maintained by ERAC-Missouri’s information technology (“IT”) team. (Ex. E at 21 to PL’s Br. Hickton.)

ERAC-Missouri directly operates an IT division known as the e-commerce team.

(Id.

at 23.) The primary responsibility of the e-commerce team is to monitor and update the content on ERAC’s network of websites, including enterprise.com, enterprise.ca, enterprise.code.uk, enterprise.de, and enterprisecarsales.com.

(Id.)

These websites allow customers to book a vehicle rental reservation or obtain information regarding vehicles for sale.

(Id.

at 83-84, 89-90.) The individual operating subsidiaries interact with the websites by informing the e-commerce team when a vehicle class is no longer available and should be removed from the website.

(Id.

at 34.)

When visiting an ERAC rental website such as enterprise.com, a potential customer can input a state, address, or zip code convenient to where they would like to rent a vehicle, along with the corresponding rental dates. (Ex. 7 at P0105 to PL’s Br. Averill.) The customer may select where the customer would prefer to pick-up a rental vehicle from a list of the nearest ERAC locations.

(Id.

at P0107.) After selecting a location, a list of that location’s available vehicles and prices is presented.

(Id.

at P0119.) The customer may select a vehicle to hold for reservation, and input personal information such as name, phone number, and credit card information to hold the reservation.

(Id.

at P0120; Ex. J to PL’s Reply Hickton.) The rental is not complete, however, until the customer signs a ticket contract at the ERAC operating subsidiary’s rental location and takes the vehicle. (Ex. E at 31 to PL’s Br. Hickton.)

When a customer completes a rental entry on enterprise.com, a vehicle is reserved.

(Id.)

The data from the enterprise.com reservation is sent to and stored in Missouri at ERAC-Missouri’s data server facility.

(Id.

at 28.) A data retrieval system known as ECARS is used by each ERAC operating subsidiary to view the stored reservation data. (Id. at 29.) ECARS data is stored exclusively The ECARS system is also utilized for rentals booked through other avenues such as the contact center, the Automated Rental Management System (“ARMS”), which is a rental system used by auto body shops and insurance companies to provide vehicle reservations to their own customers through ERAC, and third-party booking channels such as Orbitz.com and Travelocity.com. (Id. at 25-26; 29-30.)

Enterprise Rent-A-Car’s website is optimized to generate “hits” on search engines for users searching for rental cars in

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Chicago. (Ex. 21 ¶¶ 5-9 to PL’s Br. Ave-rill.) Examples of optimization include the use of metatags and purchasing of sponsored listings on search engines.

(Id.)

To promote the ERAC brand, ERACMissouri’s marketing and communications division (“Mar Com”) provides individual operating subsidiaries with marketing materials, and produces national advertisements. (Ex. I at 13 to Pl.’s Reply Hick-ton.) Marketing materials include locally targeted discounts for free upgrades, ten percent off standard daily rates, five percent off standard weekly rates, and one free weekend day. (Ex. I at E-005523, E-005524 to Pl.’s Br. Hickton.) To take advantage of the discounts, customers are directed to visit enterprise.com or call the toll free number to make a reservation.

(Id.)

Each advertisement contains ERACMissouri’s trademarked Enterprise Rent-A-Car logo and does not mention any subsidiaries.

(Id.)

Mar Com creates special discounts for use over the internet on the ERAC websites. (Ex. E at 58-59 to PL’s Br. Hick-ton.) These promotions are loaded into the websites by the National Reservations team at the contact center.

(Id.

at 62.) Each operating subsidiary can participate in the special discounts, or opt out on a branch-by-branch basis.

(Id.

at 61-63.)

ERAC-Missouri has an acquisition department. This department consists of a team of individuals that deals with the automobile manufacturers to acquire vehicles for the operating subsidiaries. (Pis.’ App., Ex. 1 at 23.) Although the acquisition department deals with manufacturers, the operating subsidiaries make the decisions about which vehicles will comprise their fleets. (Def.’s App., Ex. 3 ¶ 15; Def.’s App., Ex. 4 ¶ 15; Def.’s App., Ex. 5 ¶ 15; Def.’s App., Ex. 6 ¶ 21; Def.’s App., Ex. 7 ¶ 15.) Some operating subsidiaries have local acquisition personnel that negotiate and purchase vehicles in their local markets. (Pis.’ App., Ex. 1 at 23; Def.’s reply exhibit (Docket No. 164, Misc. No. 09-210), Ex. 26 at 107 (“I have my department that handles it locally is referred to as the Vehicle Acquisition Department.... I negotiate what I’m going to pay the dealer here in Pittsburgh or in my market area.”).)

ERAC-Missouri operates another corporate division called ERAC USA Fleet Services (“Fleet Services”). (Ex. B, at 85 to PL’s Br. Hickton.) The primary function of Fleet Services is to collect various incentives received from vehicle manufacturers and redistribute them to ERAC operating subsidiaries.

(Id.

at 85-86.) When ERAC operating subsidiaries purchase the vehicles, the various incentives associated with group vehicle purchases are sent to Fleet Services and then distributed to the operating subsidiaries based upon the number of individual vehicle purchases.

(Id.)

ERAC-Missouri maintains an external job recruiting website, www.erac.com/ recruit. (Ex. 6 ¶2 to PL’s Br. Averill.) Prospective employees select a part of the country where they would like to work. (Ex. 8 at P0121 to PL’s Br. Averill.) Available positions in the region are displayed, and prospective employees may submit an online application for a position or contact a local recruiter by calling the contact center.

(Id.

at P0122-P0123; Ex. 6 at P0095-0104 to PL’s Br. Averill; Ex. 10 at P0137 to PL’s Br. Averill.)

The www.erac.com website is hosted by an unaffiliated third-party recruiting firm, TMP Worldwide. (Def.’s Reply Averill, Ex. B ¶ 3.) Users of www.erac.com can obtain information about careers at all subsidiaries and at defendant parent.

(Id.)

If users wish to submit an employment application, they must follow a link to www.us-erac-icims.com, which is hosted by

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another unaffiliated third-party firm, iCIMS.com, Inc. (“iCIMS”).

{Id.

¶4.) Before a user can submit an employment application, the user must indicate the city and state in which he or she would like to work.

{Id.

¶5.) Completed applications are sent by iCIMS to the recruiting department of the appropriate operating subsidiary, which conducts all follow-up communication with the applicant.

{Id.)

The subsidiary makes the hiring decision without oversight or approval from ERACMissouri.

{Id.)

ERAC-Missouri is billed by iCIMS for the cost of maintaining the www.us-erac-icims.com site. ERAC-Missouri forwards these costs to the relevant operating subsidiary depending upon the number of applications that subsidiary receives.

{Id.

¶ 7.)

ERAC-Missouri has a vice-president of customer service. That position is held by Dan Gass (“Gass”). Gass is responsible for overseeing a customer service evaluation program, known as the Enterprise Service Quality Index (“ESQI”). Customers of the operating subsidiaries are surveyed by a third-party company called Maritz, and Maritz forwards the results of the surveys to the operating subsidiaries. ESQI is used by the operating subsidiaries to evaluate customer satisfaction at their branch locations. (Pis.’ App., Ex. 1 at 85-86.)

In addition to customer service evaluations, ERAC-Missouri distributes employee satisfaction surveys to the operating subsidiaries. (Pis.’ App., Ex. 6 at 194-95.) A third-party facilitates the compilation of the results of the surveys. (Pis.’ App., Ex. 1 at 177.) The results are disseminated to the operating subsidiaries from which the information came.

{Id.)

At least one operating subsidiary, however, creates and uses its own employee satisfaction survey. (Def.’s App., Ex. 5 ¶ 63.)

C. Human Resources Services

ERAC-Missouri directly operates a corporate human resources (“HR”) department. (Ex. A, at 23-24 to Pl.’s Br. Hickton.) The HR department provides a variety of services to ERAC-Missouri’s operating subsidiaries, including: a 401(k) plan and profit-sharing plan; best practices for hiring and selection of employees; general job descriptions; employee performance review forms; a suggested “management track” for employee advancement; recommended policies and programs, including paid time off policy, paternity leave policy, and breath alcohol testing program; and a compensation guide for employee salaries.

{Id.

at 21-23, 137-41, 220; PL’s App., Ex. 8; Pis.’ App., Ex. 6 at 193-95.) Through the best practices and compensation guides, the HR department at ERAC-Missouri recommends which employees at operating subsidiaries should be salaried and which should receive hourly wages. (Ex. A at 295-96 to PL’s Br. Hickton.) The best practices guide provides: “The employee is the person (who is not a dependent) on whose behalf the plan is established. Employees include only the common-law employees of Enterprise.” (Ex. 13 at P0181 to PL’s Br. Averill.) The guide also provides: “Information contained in the ... Benefit Summary Plan Description refers to employees of: The Crawford Group, Inc., Enterprise Rent-A-Car Company and their various operating subsidiaries.” (Ex. 13 at P0157 to PL’s Br. Averill.)

The HR department negotiates benefit plans with national providers to offer employees of defendant parent and the operating subsidiaries health insurance, life insurance, accidental death and dismemberment, and long-term disability coverage. (Ex. F ¶¶ 3, 4, 8 to Def.’s Reply Averill.) Benefits plans are developed by

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Dana Beffa, head of the corporate benefits department. (Pis.’ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 157.) Participation in the benefit plans is not required, but if employees of an operating subsidiary enroll, defendant parent will bill the relevant operating subsidiary for the specific benefits elected. (Ex. F ¶¶ 6, 7, 9 to Def.’s Reply Averill.) Each employee can view his or her individual benefits by logging onto an employee website provided by defendant parent to all operating subsidiaries. (Ex. J at 23-24 to Pl.’s Reply Hickton.) The best practices guide, which provides information relevant to the benefits plans, states: “At their own discretion, each [operating subsidiary] may elect to provide other benefits specific to their employees and may elect to implement its own business practices and personnel policies unique to its operations and employees.” (Def.’s App., Ex. 22 at E-002420.) With the exception of operating branches located in Hawaii and Puerto Rico, operating subsidiaries never offered benefits plans outside of those created by the HR department. (PL’s App., Ex. 5, Adams Dep. Dec. 17, 2009 at 157.)

The HR department compiles a list of available employment opportunities throughout the ERAC network. (Ex. A at 216 to PL’s Br. Hickton.) This list is available on ERAC-Missouri’s email server and can be accessed by all employees of ERAC-Missouri and its operating subsidiaries.

(Id.)

If an employee transfers from one ERAC subsidiary to another, the HR department will assist in the employee relocation.

(Id.

at 218-19.) ERAC-Missouri has a centralized website, www. enterprise.com/eracpeople, that provides access to various information regarding benefits and retirement plans, as well as other company-related information. (Ex. 13 at P0165 to PL’s Br. Averill.)

When Edward Adams (“Adams”) first started working at ERAC-Missouri’s HR department, he developed practices for the hiring and selection of employees. (Ex. A at 23 to PL’s Br. Hickton; Pis.’ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 53-54.) He provided “insight into some best practices for those activities,” (Ex. A at 23 to PL’s Br. Hickton), based upon a review of the practices being used by the operating subsidiaries (Pis.’ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 53; Def.’s App., Ex. 2 ¶ 10). In general, Adams would survey the practices being used by the operating subsidiaries in a variety of ways, including telephone communications, email communications, and in-person meetings. (Pis.’ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 54.)

Adams testified that defendant parent’s HR department would develop job descriptions for various positions utilized by the operating subsidiaries. (Ex. A at 213 to PL’s Br. Hickton.) Similarly, the HR department would develop dress codes for the various positions.

(See, e.g.,

Pis.’ App., Ex. 7 at E-009705.) The job descriptions included the general duties and responsibilities for the positions. (Ex. A at 213, 219-20 to PL’s Br. Hickton.) Defendant parent recommended salaries for these positions, and the salary recommendations were set forth in a compensation guide.

(Id.

at 219-20.) The compensation guide’s recommendations were based upon “information from a variety of sources,” including responses from operating subsidiaries or suggestions from operating subsidiaries.

(Id.

at 230.) During his deposition, Adams stated that defendant parent is involved in the classification of the operating subsidiaries’ employees by providing input to operating subsidiaries in the form of recommended compensation practices:

Q. ... So we have a clean record, let me ask you the question again. Does

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the parent have any involvement in recommending to the subsidiary or to any of the subsidiaries whether or not people holding the position of branch manager are exempt from the overtime laws?

A. The parent has input, yes.

Q. And how does the parent provide that input?

A. Well, through best practices based upon sharing with the sub once we, being the parent, have gotten information from the sub whether or not we believe that that is an exempt position or an hourly position.

Q. And is that information conveyed in the compensation guide that the branch managers are — should be — are exempt? A. It is — it is identified as an exempt job.

Q. Okay.

A. It is not specifically conveyed as to why it is or how it became.

Q. Okay. Does the parent have any involvement in recommending to the subsidiaries whether or not people holding the title assistant branch managers are exempt from the overtime laws?

A. It would be the same process with the branch manager.

Q. Okay. So your answer would be yes, they have — they have involvement, and the involvement is through the best practices — development of the best practices?

A. Yes.

Q. Okay.

A. Input through the best practices.

(Id.

at 295-96.)

Adams testified that he had conversations with employees of operating subsidiaries that wished to deviate from the compensation recommendations in the best practices guide:

Q. Okay. Ed, if there’s a deviation from the compensation guide, is there a protocol for notifying the parent?

A. Yes.

Q. Okay. What is that protocol?

A. The protocol is that the parent would talk with the sub; and in most cases, it would be the sub initiating contact with the parent in order to discuss what the exception would be.

Q. Okay. And to whom does that conversation occur?

A. In many cases, it occurs with the corporate vice president of group operations or senior vice president of group operations or myself.

Q. Have you had conversations with operating subsidiaries in which they’ve conveyed to you that there’s a — they have deviated from the compensation guide?

A. I’ve had some conversations on some areas of the compensation guide, yes.

(Id.

at 298.) Adams asserted that the protocol for deviation was not formally stated:

Q. Does the parent — is the parent made aware of when a sub chooses not to follow an individual practice as set forth in this guide?

A. It might be.

Q. Is there a protocol for ensuring the parent is made aware?

A. Well, I think the protocol really is common courtesy to share with us if there’s something that they’re not doing, but I can’t say that that always occurs. Q. Okay. Ed, is it my understanding that the parent company has approximately 50 or so, plus or minus a few, operating subsidiaries and that the only way it ensures that the business practice guide which it develops and disseminates the policies therein are followed or

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deviated from is through common courtesy of the individual subs?

A. I think that’s one of the ways, but what I’m saying is that they may call, they may not call. So I can’t always tell you whether people are contacted on that. It depends on the issue.

(Ex. 7 at 323 to Def.’s Br. Hickton.)

Robert Keyes (“Keyes”), vice president and general manager of Enterprise Leasing Company of Philadelphia, LLC, testified that he did not follow the recommendations with respect to compensation of certain employees:

A. We have set up in our group a pay range that we would like to see folks achieve. And if the business does not support that within their commission structure we will put in place a nonstandard plan so that they will get their — as an example, if we feel an assistant manager should be in the $40,000 pay range, yet the profits of the business don’t support that, we would put something in place to allow them to achieve something near that $40,000 or exceed it.

Q. Can you give me an example of what you would put in place to do that.

A. Incentives, bonuses over and above just a percentage of the profits.

(Ex. 6 at 225-26 to Pis.’ App.) Keyes had conversations with Rick Allen (“Allen”), a vice president of his subsidiary, about the use of nonstandard pay plans, and Allen supported Keyes’ decision.

(Id.

at 226.) Keyes used nonstandard pay plans for a variety of employees, including certain assistant branch managers. (Def.’s App., Ex. 10 at 225.)

Adams testified that the ultimate decision to classify a position as exempt was up to the operating subsidiary:

A. ... We would recommend to the subs that these are exempt positions.

Q. Okay.

A.

It is for them to decide.

Q. To your knowledge, do any of the subsidiaries pay — despite the recommendations made in the compensation guide, pay assistant branch managers on an hourly basis?

A. Yes.

Q. Okay. To your knowledge, are the— are those locations within California?

A. To the best of my knowledge, they’re in California.

Q. Okay. To your knowledge, do any of the subsidiaries outside of California pay assistant branch managers on an hourly basis?

A. I’m not aware of any.

Q. Okay. To your knowledge, despite the recommendation in the compensation guide, do any operating subsidiaries pay branch managers on an hourly basis?

A. I’m not aware of any.

Q. Okay. And that’s both within California, outside of California?

A. That is correct.

(Id.

at 297 (emphasis added).)

In 2005, Adams attended a meeting at which ERAC-Missouri’s in-house counsel and general managers of the operating subsidiaries were present. (Pis.’ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 90.) At that meeting, Adams communicated his recommendation — which was later memorialized in the best practices guides — that assistant branch managers outside of California should be classified as exempt.

(Id.

at 89 (“The job title of assistant branch manager outside of California was recommended to be exempt, and we shared that with the individual subs.”).) With respect to the subsidiaries operating branch locations in California, Adams testified:

A. ... I do not determine what [the activities and job responsibilities] would

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be for that assistant branch manager in California.

All I can do is tell you as I have generally that they would not have employees reporting to them and that then-responsibilities would not include the kind of judgment and problem solving that we have in the other 49 states.

But I can’t tell you specifically what they do. Nor could I tell you specifically what any individual would do. That would be the general manager in that particular sub.

Q. Well, you would still ultimately be responsible for giving recommendations to California as to the classification of the employees in the branch locations as exempt or nonexempt. Correct?

A. ... I would' — if asked, I could make a recommendation based upon an understanding of what their job responsibilities are today in a particular sub. But I don’t know what they do and I never was an assistant branch manager, nor have I examined the assistant branch manager job in order to determine what they’re doing today.

Q. Well, it’s accurate to say that in your position you are overseeing corporate HR with respect to recommendations that go out to subsidiaries regarding the classification of the job positions in the subsidiaries as exempt or nonexempt. Correct?

A. That is correct.

Q. That includes California?

A. That includes California.

Q. So someone within corporate HR needs to have an understanding of what the job duties and responsibilities are for the positions in order to give those recommendations. Correct?

A. Someone in corporate may have an idea of — well, in fact someone in corporate may have been a part of developing a job description for California.

But once it’s provided to California, it’s up to those individual subs to determine what in fact they’re going to do of that general nature type of an assistant branch manager job.

(Pls.’ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 94-95.)

The best practices guide is sent to all full-time employees of defendant parent and the operating subsidiaries. (Ex. A at 334-35 to Pl.’s Br. Hickton.) Adams testified that defendant parent’s HR department provides assistance to employees of all operating subsidiaries, and this assistance includes the ability to participate in the retirement savings plan and 401(k) plan.

(Id.

at 21-23.) The HR department does not maintain personnel files for the operating subsidiaries’ branch managers or assistant branch managers. (Def.’s App., Ex. 2 at ¶ 21.)

Adams testified that he could recall at least one individual who went from a corporate vice president position at defendant parent to a vice president or general manager position at a subsidiary, and he believed that such position changes have happened more than once. (Ex. A at 58 to Pl.’s Br. Hickton.) He stated that “at virtually any point in [their] career,” a person can move from a corporate position at defendant parent to a position at an operating subsidiary.

(Id.

at 141.) The operating subsidiaries do not have an arrangement to interchange their branch managers or assistant branch managers with ERAC-Missouri or each other. (Def.’s App., Ex. 3 ¶ 76; Def.’s App., Ex. 4 ¶ 79; Def.’s App., Ex. 5 ¶ 78; Def.’s App., Ex. 6 ¶ 73; Def.’s App., Ex. 7 ¶ 77.)

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The HR department provides training and direction to management level employees of the operating subsidiaries. (Ex. F ¶ 33, 52-53 to Pl.’s Reply Hickton.) ERAC-Missouri’s corporate training department has approximately twenty employees and develops best practices for training that are distributed to the operating subsidiaries. (Pis.’ App., Ex. 5, Adams Dep. Dec. 17, 2009 at 31.)

Another ERAC-Missouri division related to the HR department is the employee communications division. (Ex. A at 50 to Pl.’s Br. Hickton.) The primary responsibility of the employee communications division is to communicate about the Enterprise brand.

(Id.

at 51.) Those communications encompass a wide range of issues affecting the ERAC network.

(Id.

at 50.) ERAC-Missouri sends magazines to employees of the subsidiaries on a quarterly basis. (Ex. 14 ¶ 7 to Pl.’s Br. Averill.)

ERAC-Missouri maintains a toll-free hotline for employees to voice concerns that they do not wish to raise with their direct superiors at an operating subsidiary. (Ex. B at 338 to Pl.’s Reply Hickton.) Messages on the hotline are received and addressed by business managers within ERAC-Missouri.

(Id.

at 338.) The same concerns can also be reported directly to the HR department.

(Id.

at 337.)

D. ERAC-Missouri’s Contacts in Pennsylvania and Illinois

ERAC-Missouri alleges that it is not registered with the Secretary of State of Pennsylvania or Illinois for the purpose of conducting business in either Pennsylvania or Illinois and does not have agents for service of process in those jurisdictions. (Ex. 1 ¶ 6 to Def.’s Br. Hickton; Ex. D ¶ 7 to Def.’s Br. Averill.) ERAC-Missouri, however, on July 30, 2008 — approximately eight months after the action in Pennsylvania was commenced — filed a certifícate of authority with the Pennsylvania Secretary of State stating that it is an active foreign business corporation providing “administrative services.” (Ex. A to Pl.’s Reply Hickton.) The filing states it is “perpetual,” and was on file as of May 5, 2009.

(Id.)

ERAC-Missouri asserts that the filing resulted from an error and on June 1, 2009, withdrew the filing. (Notice of Correction (Docket No. 96, Civ. No. 07-1687), Exs. A, B.)

ERAC-Missouri registered the “e and design” service mark with the Illinois Secretary of State in 1969 for use with “services in connection with the sale and leasing of automobiles,” which registration expired on December 31, 2009. (Ex. 2 at P0017 to PL’s Br. Averill.) ERAC-Missouri registered the “executive” service mark with the Illinois Secretary of State in 1997 for use with “vehicle renting and leasing services,” which registration will expire on August 12, 2012.

(Id.

at P0018.)

In August 2004, ERAC-Missouri initiated a lawsuit against Collision Industry Management Solutions in the United States District Court for the Northern District of Illinois.

(See

Ex. 1 to PL’s Br. Averill.) The lawsuit claimed that Collision Industry Management Solutions infringed ERAC-Missouri’s trademarks registered with the United States, when Collision Industry Management Solutions created a system offering a similar service to Enterprise Rent-A-Car’s ARMS system and called it by the same name.

(Id.

at P0001-P0003.) In the complaint, defendant parent alleged:

Enterprise is a Missouri corporation with a principal place of business at 600 Corporate Park Drive, St. Louis, Missouri 63105.

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Enterprise operates a large number of locations in the Northern District of Illinois. Both Enterprise and [the defendant] conduct business in the Northern District of Illinois, including the offering of their respective ARMS services and computer programming.

(Id.

at P0002.)

E. Boards of Directors of ERACMissouri’s Operating Subsidiaries

At the time the complaints were filed, the board of directors at every operating subsidiary was comprised of directors from ERAC-Missouri. (Ex. H at 175 to PL’s Reply Hickton.) Andrew C. Taylor (“Taylor”), Pamela Nicholson (“Nicholson”), and William W. Snyder (“Snyder”) are members of ERAC-Missouri’s board of directors, and they also serve as executive officers for ERAC-Missouri. (Ex. B at 79 to Pl.’s Br. Hickton; Pis.’ App., Ex. 2 at 14.) Those three individuals served on the three-person boards of directors of all operating subsidiaries.

9

(Id.

at 175.) In Nicholson’s biography she represents that she oversees the efforts of 68,000 employees, and in Snyder’s biography he represents that he has overall responsibility for more than 68,000 employees. (Pis.’ App., Exs. 10, 11.) In Taylor’s biography he similarly represents that “Enterprise Holdings has a fleet of more than one million vehicles and 68,000 employees.” (PL’s App., Ex. 16.)

As members of the boards of directors of the operating subsidiaries, Taylor, Nicholson, and Snyder collectively had the power, on behalf of an operating subsidiary, by majority vote to do all things necessary or convenient to carry out the business and affairs of the operating subsidiary.

10

(See

Pis.’ App., Ex. 3.

11

)

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The boards of directors of the operating subsidiaries delegated the vast majority of their authority to the operating subsidiaries’ management personnel, and principally to their general managers.

(See

Def.’s App., Ex. 1 ¶ 33; Def.’s App., Ex. 2 ¶3; Def.’s App., Ex. 3 ¶¶ 23-25; Def.’s App., Ex. 4 ¶¶ 23-25; Def.’s App., Ex. 5 ¶¶23-25; Def.’s App., Ex 6 ¶¶ 11, 27-28; Def.’s App., Ex. 7 ¶¶ 23-25.) In particular, they delegated the power to sell, transfer, or purchase property. In accordance with this delegation of power, Keyes, vice president and general manager of Enterprise Leasing Company of Philadelphia, LLC, testified he made the decision to purchase a rental office location. (Pis.’ App., Ex. 6 at 121.) Timothy Nettles (“Nettles”), the vice president and general manager of ERAC-Pittsburgh, testified that he “worked out a deal” to transfer two branch locations to another operating subsidiary. (Def.’s reply exhibit, Ex. 26 at 11.) The boards of directors delegated the power to hire or fire branch managers and assistant branch managers of each operating subsidiary to that subsidiary’s management personnel. (Def.’s App., Ex. 1 ¶ 33.) General managers can earn annual compensation ranging from the mid-six figures to upper-seven figures. (Def.’s App., Ex. 2 ¶ 4; Def.’s App., Ex. 9 at 14-16.)

F. Characteristics of ERAC-Missouri’s Operating Subsidiaries

Matthew Darrah, who serves as ERACMissouri’s executive vice president of North America, testified that ERAC-Missouri’s performance is related to the performance of the operating subsidiaries:

Q. Do you agree that the work of the employees at the branch locations is integral to the performance of the parent company Enterprise?

A. If the subsidiaries don’t do well, yeah, the entire, yeah, company doesn’t do well. The entity doesn’t do well.

Q. So is the answer to the question yes?

A. Yes.

(Pls.’ App., Ex. 1 at 104.)

The operating subsidiaries hire, promote, discipline, and fire their own branch managers and assistant branch managers. (Def.’s App., Ex. 2 ¶ 7; Def.’s App., Ex. 3 ¶¶ 30, 32-33; Def.’s App., Ex. 4 ¶¶ 30, 32-

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33; Def.’s App., Ex. 5 ¶¶30, 32-33; Def.’s App., Ex. 6 ¶¶ 30-31, 34-35; Def.’s App., Ex. 7 ¶¶ 30, 32-33.) For example, Keyes, vice president and general manager of Enterprise Leasing Company of Philadelphia, LLC, testified that in “my 24-and-a-half years with the company there has never been any precedent” of involvement of any person from ERAC-Missouri in his decisions to hire or fire employees of the operating subsidiaries. (Def.’s App., Ex. 10 at 240-41.) Although Taylor, Nicholson, and Snyder were the only members of the boards of directors and as board members could vote on various matters affecting the operating subsidiaries, they did not participate in hiring or firing branch managers or assistant branch managers. (Def.’s App., Ex. 3 ¶ 36; Def.’s App., Ex. 4 ¶ 36; Def.’s App., Ex. 5 ¶ 36; Def.’s App., Ex. 6 ¶ 38; Def.’s App., Ex. 7 ¶ 36; Def.’s App., Ex. 11 at 129-30.) Brian Mogauro (“Mogauro”), vice president and general manager of Enterprise Leasing of Orlando, LLC, testified that Taylor, Nicholson, and Snyder “were never involved in my — in that process in Orlando,” and any potential they possess for interjecting in that process is inconsequential because such interjection is “out of the norm of reality.” (Def.’s App., Ex. 11 at 130-32.) The operating subsidiaries review the performance of their branch managers and assistant branch managers. (Def.’s App., Ex. 2 ¶ 8; Def.’s App., Ex. 3 ¶ 31; Def.’s App., Ex. 4 ¶ 31; Def.’s App., Ex. 5 ¶ 31; Def.’s App., Ex. 6 ¶ 33; Def.’s App., Ex. 7 ¶ 31.) Keyes testified that in order to assess the performance of assistant branch managers at his operating subsidiary, he utilized an annual review form created by ERACMissouri. (Pis.’ App., Ex. 6 at 93-94.)

The operating subsidiaries decide where they will open and operate branches. (Def.’s App., Ex. 3 ¶ 45; Def.’s App., Ex. 4 ¶ 46; Def.’s App., Ex. 5 ¶ 46; Def.’s App., Ex. 6 ¶ 46; Def.’s App., Ex. 7 ¶ 46.) The operating subsidiaries decide the days and hours that their branches will be open for business. (Def.’s App., Ex. 3 ¶ 46; Def.’s App., Ex. 4 ¶47; Def.’s App., Ex. 5 ¶47; Def.’s App., Ex. 6 ¶ 49; Def.’s App., Ex. 7 ¶ 47.) The operating subsidiaries ' decide when their employees will be moved from one branch location to another. (Def.’s App., Ex. 3 ¶ 48; Def.’s App., Ex. 4 ¶ 49; Def.’s App., Ex. 5 ¶ 49; Def.’s App., Ex. 6 ¶ 51; Def.’s App., Ex. 7 ¶ 49.) The operating subsidiaries decide which days and hours their branch managers and assistant branch managers will work at the assigned branch locations. (Def.’s App., Ex. 3 ¶ 49; Def.’s App., Ex. 4 ¶ 50; Def.’s App., Ex. 5 ¶ 50; Def.’s App., Ex. 6 ¶ 52; Def.’s App., Ex. 7 ¶ 50; Def.’s App., Ex. 10 at 135.)

The operating subsidiaries set the compensation for their branch managers and assistant branch managers. (Def.’s App., Ex. 3 ¶ 37; Def.’s App., Ex. 4 ¶ 37; Def.’s App., Ex. 5 ¶¶ 37, 39; Def.’s App., Ex. 6 ¶ 39; Def.’s App., Ex. 7 ¶ 37.) The operating subsidiaries determine whether branch managers and assistant branch managers are classified as exempt from the FLSA overtime provisions. (Def.’s App., Ex. 3 ¶ 42; Def.’s App., Ex. 4 ¶ 43; Def.’s App., Ex. 5 ¶ 43; Def.’s App., Ex. 6 ¶ 45; Def.’s App., Ex. 7 ¶ 43; Def.’s App., Ex. 12 at 34-35.) Keyes testified at his deposition that if he wanted to change the classification of assistant branch managers working for his operating subsidiary from exempt from receiving overtime to nonexempt, he would consult Allen. (Def.’s App., Ex. 10 at 206-07.) Mogauro at his deposition was asked, “Who made the determination that assistant managers would be exempt under the [FLSA] for the Orlando group?” (Def.’s App., Ex. 11 at 78.) Mogauro responded, “I can only speak for since I’ve been here. Me.”

(Id.)

The operating subsidiaries’ classifications of assistant branch managers are consistent with the recommendations

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of ERAC-Missouri.

(See

C.S.F. ¶ 109.) While ERAC-Missouri creates and distributes job descriptions for assistant branch managers, the operating subsidiaries may or may not use these descriptions. For example, Nettles testified that he does not use the recommended job descriptions. (Def.’s App., Ex. 26 at 179.)

The operating subsidiaries elected to adopt many of the policies recommended by ERAC-Missouri. (Def.’s App., Ex. 3 ¶ 53; Def.’s App., Ex. 4 ¶ 54; Def.’s App., Ex. 5 ¶ 54; Def.’s App., Ex. 6 ¶¶ 55-56; Def.’s App., Ex. 7 ¶ 52.) For example, Mogauro uses within his operating subsidiary a form consent agreement regarding drug testing that was provided by ERACMissouri. (Pis.’ App., Ex. 4 at 123.) When Mogauro was asked if he expects employees who work at his operating subsidiary to comply with the policies recommended by ERAC-Missouri, he answered, “I would expect the employees in Orlando to adopt the policies that I set for Orlando.” (Def.’s App., Ex. 11 at 55.) Keyes testified that when a recommended policy “came in I would sit down with my HR manager and say, yes, this is something we are going to choose.” (Pl.s’ App., Ex. 6 at 194.) The operating subsidiaries may decide to vary from ERAC-Missouri’s recommended policies. (Def.’s App., Ex. 2 ¶ 16; Def.’s App., Ex. 3 ¶ 54; Def.’s App., Ex. 4 ¶¶ 55-56; Def.’s App., Ex. 5 ¶ 54; Def.’s App., Ex. 6 ¶ 55; Def.’s App., Ex. 7 ¶ 55.)

With respect to training materials, the operating subsidiaries may use the materials provided by ERAC-Missouri. (Def.’s App., Ex. 2 ¶ 18; Def.’s App., Ex. 3 ¶ 57; Def.’s App., Ex. 4 ¶ 58; Def.’s App., Ex. 5 ¶ 57; Def.’s App., Ex. 6 ¶ 57; Def.’s App., Ex. 7 ¶ 58.) The operating subsidiaries tailor the training they provide the employees who work at their branch locations, in order to suit the operating subsidiaries’ particular strategies and to best meet the unique needs of their businesses, clients, and locations. (Def.’s App., Ex. 3 ¶ 58; Def.’s App., Ex. 4 ¶ 59; Def.’s App., Ex. 5 ¶¶ 57-58; Def.’s App., Ex. 6 ¶¶ 57-58; Def.’s App., Ex. 7 ¶ 59.) Training sessions for assistant branch managers are held locally by the operating subsidiaries, and the training sessions are staffed by employees of the operating subsidiaries. (Def.’s App., Ex. 3 ¶ 59; Def.’s App., Ex. 4 ¶ 60; Def.’s App., Ex. 5 ¶¶ 59-61; Def.’s App., Ex. 6 ¶¶ 59-60; Def.’s App., Ex. 7 ¶ 60.) Newly-hired branch managers are invited to attend a single national meeting with other newly-hired branch managers from operating subsidiaries around the country, but assistant branch managers attend no such meetings. (Def.’s App., Ex. 3 ¶¶ 59-60; Def.’s App., Ex. 4 ¶¶ 60-62; Def.’s App., Ex. 5 ¶¶ 59-60; Def.’s App., Ex. 6 ¶¶ 59-60; Def.’s App., Ex. 7 ¶¶ 60-61.)

The sample plaintiffs

12

deposed in this case did not physically work at ERACMissouri’s headquarters. (Def.’s App., Ex. 14 at 46-47; Def.’s App., Ex. 15 at 99-100; Def.’s App., Ex. 16 at 28-29; Def.’s App., Ex. 17 at 135; Def.’s App., Ex. 18 at 340; Def.’s App., Ex. 19 at 11-12; Def.’s App.,

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Ex. 20 at 140-43.) Bajkowski, who worked as an assistant branch manager for ELC-Chicago, testified that the only direction he took from someone in corporate headquarters was during a training session. (Def.’s App., Ex. 13 at 52-53.) Biski, who worked as an assistant branch manager at a branch in Schenectady, New York, testified that he was unaware of anyone from corporate headquarters evaluating performance, commenting on performance reviews, or conducting an interview. (Def.’s App., Ex. 14 at 36, 40, 296-98.) Graham, who worked as an assistant branch manager at branches in Miami, Florida, testified that he understood his employment was with the subsidiary, not ERAC-Missouri. (Def.’s App., Ex. 15 at 96-100.) Hagler, who worked as an assistant branch manager at a branch in Tuscaloosa, Alabama, testified that he “assumed [he] was employed by Enterprise Leasing Company South Central,” not ERAC-Missouri. (Def.’s App., Ex. 16 at 28-29.) Hagstrom, who worked as an assistant branch manager at branches in New York, New York, and Singleton, who worked as an assistant branch manager for ELC-Chicago, testified that they never had contact with anyone from ERAC-Missouri during their employment. (Def.’s App., Ex. 17 at 87-88; Def.’s App., Ex. 21 at 93, 95.) Hick-ton, who worked as an assistant branch manager for ERAC-Pittsburgh, testified that he did not have contact with anyone from ERAC-Missouri during his hiring or promotion processes, and he indicated on job applications that his employer was “Enterprise Rent-A-Car Company of Pittsburgh.” (Def.’s App., Ex. 18 at 22-23, 82-83,120,132-33,180,186-87.)

ERAC-Missouri has the authority to enter into nationwide rental agreements that provide for car rental rates for certain customers. Darrah, ERAC-Missouri’s executive vice president of North America, testified about these contracts:

Q. You would want to make sure that Atlanta had sufficient vehicles to be able to service the demand?

A. Sufficient vehicles, sufficient operating space, space at airports is finite. You have to really watch the amount of business you bring on in some cases because it might be too much, believe it or not. But that is reality.

Q. Are there national sales contracts actually signed between the parties?

A. Oh, sure, yes.

Q. Who signs on behalf of Enterprise?

A. It would depend on the size of the account.

Q. What about somebody like IBM?

A. For somebody for like IBM, probably Brad Carr who you mentioned earlier. But for a small to medium size business, it would be somebody at the local group.

Q. Would Mr. Carr also be the one who would sign the contract for Enterprise with Siemens?

A. Yeah, more than likely.

Q. Would Mr. Carr be the one to negotiate any of the particular terms and conditions of those contracts with the customers?

A. He would be the one that would gather the information, would communicate with the groups that would be impacted by signing a customer that size, would get a — sign off on the rates and revenue that would be generated from that account, yes.

Q. As part of those national sales accounts, those customers would get special rates; is that correct?

A. Would they get special rates? They would get rates — -it just depends. There may be different rates and different markets based on the cost of doing business in those markets.

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Q. Well, they would get preferred rates or preferred terms that they would not get if they had not entered into the contract, correct?

A. There would certainly be some consideration for volume that would make the rates better for sure, yeah.

Q. Then once Mr. Carr signs off on those contracts, the specific branch locations that are effected would have to comply with the rates or the provisions of those contracts, correct?

A. They would have given their blessing, if you will, that go ahead and sign that up and I’ll handle it.

Q. Okay. And I think I asked you before, are you aware of any branch locations that ever refused to agree to entering into a National account or servicing a national account?

A. Could I come up with one? No. Certainly not after one was signed, no. But prior to one being signed, there may have been instances where an operating group said, you know, that’s probably not a good idea for us.

Q. Can you give me a specific example?

A. I can’t off the top of my head. I can tell you we fought long and hard about it in the Atlanta market with IBM. As much as we wanted that piece of business, we were concerned about whether or not we could handle it in that market. The local GM was concerned about whether or not they could handle the volume.

(Pls.’ App., Ex. 1 at 123-25.) When asked whether his operating subsidiary was required to comply with nationwide contracts, Keyes testified “not necessarily,” although he explained that he never rejected a nationwide contract because he found them all lucrative to his subsidiary. (Pls.’ App., Ex. 6 at 154-55.)

With respect to the nationwide contracts, Mogauro testified as follows:

Q. Number two refers to location participation; correct?

A. Yes, I see it.

Q. According to that first statement under location participation, “All locations are required to honor the rates contained in this agreement.”

Do you see that?

A. Yes.

Q. Would it be your understanding that Enterprise Orlando would be, required to honor the rates contained in this agreement?

A. My understanding — I would want this business in Orlando.

Q. That wasn’t exactly the question. You would comply with the terms of this agreement; correct?

A. I would adopt the terms of the agreement and appreciate the business.

Q. When you say adopt, what do you mean?

A. I would adopt and grant cars to this particular company that has these rates.

Q. You would comply with the terms of the agreement?

A. I wouldn’t say comply. I would say I would rent cars to the people based on this agreement.

Q. According to the terms of this agreement?

A. Correct.

(Pls.’ App., Ex. 4 at 103-04.)

With respect to the management hierarchy structure followed by the operating subsidiaries, assistant branch managers report to branch managers, and branch managers report to area managers. (C.S.F. ¶¶ 51, 53.) Area managers report to employees who work solely for the oper

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ating subsidiaries. The titles held by those employees vary depending on how the particular operating subsidiary decides to structure its own management. (C.S.F. ¶ 55.) For example, area managers working at branch locations operated by Enterprise Leasing Company of Philadelphia, L LC report to regional vice presidents. (Def.’s App., Ex. 3 ¶ 66.) Similarly, area managers working at branch locations operated by Enterprise Leasing Company— South Central, LLC report to regional vice presidents, although they used to report to regional managers. (Def.’s App., Ex. 4 ¶ 69.) Bruce McKee, general manager and president of Enterprise Leasing Company — South Central, LLC made the decision to reorganize management structure within his subsidiary.

(Id.)

In contrast, area managers working at branch locations operated by Enterprise Leasing Company of Orlando, LLC report to group rental managers. (Def.’s App., Ex. 5 ¶ 68.) All employees of the operating subsidiaries ultimately report to general managers. (Def.’s App., Ex. 3 ¶ 67; Def.’s App., Ex. 4 ¶¶ 25, 70; Def.’s App., Ex. 5 ¶¶25, 69; Def.’s App., Ex. 6 ¶¶ 11, 64; Def.’s App., Ex. 7 ¶ 68.)

With respect to the reporting obligations of the general managers, Keyes testified that he reports to Allen, who is the “[s]enior vice president.” (Pis.’ App., Ex. 6 at 36.) Keyes testified as follows:

Q. ... what is your understanding of what the role is of the three individuals who are the managers of the LLC?

A. To make sure I am doing my job.

Q. Do you ever report to Mr. Taylor, Ms. Nicholson and Mr. Snyder, the three of them together, in their role as the managers of the LLC?

A. My immediate supervisor is Rick Allen.

Q. And by that answer, what do you mean? I had asked you whether you ever report to those three together?

A. Then, no.

Q. So is it your understanding that you report to Mr. Allen and he reports to those three individuals in their role as managers of the LLC?

A. Yes.

Q. As managers of the LLC, is that another part of their responsibilities that they have a chairman of the holding company for Mr. Taylor, and as COO for Ms. Nicholson and CFO for Mr. Snyder?

A. Yes.

(Id.

at 167-68.) Allen is the vice president of a number of the operating subsidiaries.

(See

Def.’s App., Ex. 3 ¶ 22; Def.’s App., Ex 6 ¶ 26; Def.’s App., Ex. 7 ¶ 22.) Operating subsidiaries prepare and send monthly financial reports to ERAC-Missouri that contain, among other things, information regarding fleet size, profits, costs, and expenses. (C.S.F. ¶ 96; Pis.’ App., Ex. 4 at 71-72; Pis.’ App., Ex. 6 at 112-13.)

The operating subsidiaries contract directly with outside payroll services to process paychecks for their employees. (Def.’s App., Ex. 3 ¶ 72; Def.’s App., Ex. 4 ¶ 75; Def.’s App., Ex. 5 ¶ 74; Def.’s App., Ex. 6 ¶ 69; Def.’s App., Ex. 7 ¶ 73.) The operating subsidiaries draw from their own bank accounts to compensate their branch managers and assistant branch managers. (Def.’s App., Ex. 3 ¶ 71; Def.’s App., Ex. 4 ¶ 74; Def.’s App., Ex. 5 ¶ 73; Def.’s App., Ex. 6 ¶ 68; Def.’s App., Ex. 7 ¶ 72.) ERAC-Missouri plays no role in the payroll process used by the majority of the operating subsidiaries for branch managers and assistant branch managers. (Def.’s App., Ex. 2 ¶ 22.) ERAC-Missouri provides a shared payroll service to four of its smaller operating subsidiaries, which are located in (1) Missouri, (2) Hawaii, (3)

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Harrisburg, Pennsylvania, and (4) a combination of North Dakota, South Dakota, and Montana.

(Id.)

These four operating subsidiaries pay a special fee for the payroll service.

(Id.)

In addition to the services provided to the operating subsidiaries by ERAC-Missouri’s HR department, the subsidiaries maintain their own human resources departments. (Def.’s App., Ex. 3 ¶ 68; Def.’s App., Ex. 4 ¶ 71; Def.’s App., Ex. 5 ¶ 70; Def.’s App., Ex. 6 ¶ 65; Def.’s App., Ex. 7 ¶ 69; Def.’s App., Ex. 10 at 34-36; Def.’s App., Ex. 11 at 35, 129; Def.’s App., Ex. 12 at 15, 81, 115-116.)

The members of the boards of directors of the operating subsidiaries voted on several matters, such as the declaration of dividends. (Pls.’ App., Ex. 2 at 35-36; Pis.’ App., Ex. 4 at 89-90; Pl.’s App., Ex. 6 at 166.) General managers of the subsidiaries did not necessarily track the dividends that their boards of directors would select. For example, Keyes did not see a document stating the amount of a quarterly dividend paid on November 17, 2008. (Pls.’ App., Ex. 6 at 170.) Although that kind of document is available to Keyes, he never attempted to obtain one.

(Id.

at 171.)

G. ERAC-Pittsburgh

At the time the complaint was filed, ERAC-Pittsburgh was incorporated under Pennsylvania law and was registered to conduct business in Pennsylvania. (Ex. 4 ¶ 3 to Def.’s Br. Hickton.) It is wholly owned by ERAC-Missouri, and, as an operating subsidiary, it primarily rents vehicles.

(Id.

¶4.) Both ERAC-Missouri and ERAC-Pittsburgh observed corporate formalities, had separate articles of incorporation and bylaws, and filed separate annual reports.

(Id.

¶ 5.) ERAC-Pittsburgh maintains a corporate headquarters in Pittsburgh, Pennsylvania.

(Id.

¶ 8.)

Nettles is the vice-president and general manager of ERAC-Pittsburgh. (Ex. 3 ¶¶ 2, 5 to Def.’s Br. Hickton.) Nettles makes the operational decisions for ERAC-Pittsburgh.

(Id.

at ¶ 5.) Under Nettles’ supervision, ERAC-Pittsburgh builds and maintains a car rental business.

(Id.

¶ 7.) ERAC-Pittsburgh selects its branch locations, rents office space, chooses which vehicles to buy, and formulates its own strategies to capture the Pittsburgh car rental market.

(Id.

¶ 8.) Subject to Nettles’ authorization, ERAC-Pittsburgh’s management sets operating hours, establishes sales and rental prices (except for national accounts), processes payroll, maintains financial records and bank accounts, and makes employment decisions.

(Id.

at ¶ 9; Ex. 4 ¶ 12 to Def.’s Br. Hick-ton.) Nettles is required to attend two meetings a year at ERAC-Missouri’s offices in St. Louis. (Ex. D at 191 to PL’s Reply Hickton.) ERAC-Missouri recommends best practices for operating subsidiaries and branch locations, to which ERAC-Pittsburgh largely adheres. (Ex. 3 ¶¶ 11-12 to Def.’s Br. Hickton; Ex. F to PL’s Br. Hickton.)

ERAC-Pittsburgh pays an annual management fee to ERAC-Missouri for, among other things, the privilege of using ERAC trademarks and the Enterprise brand name. (Ex. 3 ¶¶ 8, 10 to Def.’s Br. Hickton.) ERAC-Pittsburgh frequently holds itself out to consumers as part of the Enterprise brand. For example, its signs at Pittsburgh-area airports read “Enterprise Renb-A-Car Company” without specifying “Enterprise Renb-A-Car Company of Pittsburgh.” (Ex. C at 145 to PL’s Br. Hickton.)

Nettles testified at his deposition that branch managers and assistant branch managers at his subsidiary have been classified as exempt from the FLSA overtime provisions ever since he put in place the

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management structure in 1989, and he based this structure upon his prior experience:

Q. Are all of the branch managers at Enterprise Pittsburgh exempt from the overtime requirements of the FLSA and Pennsylvania Wage Law?

A. They are, yes.

Q. Same question for assistant branch managers.

A. Yes.

Q. In your current position, has that always been the case for both branch managers and the assistant branch managers?

A. That’s the structure I put in place.

Q. You put in place?

A. Yes.

Q. When did you put that structure in place?

A. When I opened the subsidiary in 1989.

Q. Who made that — well, you said you decided. That was your—

A. That was my structure. That’s what I put in place, yes.

Q. Did anybody from the parent company have any input into that structure as you put it?

A. As far as my ultimate decision to go that route, no.

Q. Did you consult with anybody from the parent company about your choice to make these positions exempt?

A. No.

Q. How did you decide to make these positions exempt?

A. It’s more from just my past experience.

Again, in the Tampa subsidiary I was a daily rental branch manager. It’s a system where salary plus the commission on the profitability of that branch. And it’s a very, very motivating factor.

I always felt that, and that’s the way that I’m compensated. Being paid off of what you produce is the ultimate way to go.

(Def.’s App., Ex. 12 at 34-35.)

Nettles testified at his deposition that personnel hiring decisions were his alone, and defendant parent’s office did not have input:

Q. Did the parent company have any input into their hiring in their current positions?

A. As far as the decision to hire them?

Q. Yes.

A. No.

Q. Were you the sole person to decide to hire those people?

A. I made the final decision, yes.

Q. Was input provided by anybody else?

A. Input that I might have solicited.

Q. Who would you solicit that other information from?

A. I have a rather unique hiring style. Depending on the position, I will get input from other department heads, which those all are. If that person I’m hiring for has overlap or touches those other departments on a regular basis, I make them part of the interview process. I might have, if they came from another subsidiary, would have had conversation with their supervisor at the other subsidiary, seeing what kind of job they were doing there.

Q. Did you communicate with the parent company for the hiring of any of those individuals?

A. Only from the standpoint that that would be a significant item that I might, would have included in my end of the month report.

Q. But are you saying that prior to making the decision to hire these people,

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are you saying that you did not contact corporate?

A. I didn’t contact corporate specifically on that matter. There is a timing issue, though. If last month’s report there was an opening, that might have, that would qualify to me as a significant item, I would mention that in my, let’s see, January report. I may not replace the person until February. And then once they’re replaced, that would make the report in February as somebody that I selected to take over one of those positions.

Q. If there is an opening in one of those positions, does the parent company ever make a suggestion on an individual to fill that position?

A. In my case, no.

Q. And when you say in your case no, do you know whether the parent company would make such a suggestion in other operating subsidiaries?

A. I wouldn’t know that. But based on having worked in three other subsidiaries, I have never seen it happen. And I have worked for numerous Rick Allen types over my 30 years, and in my tenure, I have never seen that.

(Ex. 6 at 25-27 to Def.’s Br.-Hickton.)

With respect to whether the best practices guide was mandatory, Nettles stated:

Q. Now, you just spoke about proposed edits to this. Who do those edits go to, who are they sent to?

A. I believe the request for any changes came from Ed Adams.

Q. From Ed Adams. And Ed Adams—

A. He’s at the parent.

Q. At the parent company.

A. I believe he’s in the HR Department. You also mentioned earlier about the dress codes.

Q. Right.

A. And after thinking about that, again, that’s not a hard-cut-stone dress code. For example, we have a Hawaiian operation, and they wear the Aloha shirts, much to the chagrin of most of us on the mainland. I can remember years ago my counterpart who ran the Cleveland operation used to make fun of me because my, the men at least would wear blue blazers and kaki [sic] slacks and he made all his people wear white shirts and suits all the time, and he took a harder approach to the dress code than what I took. I took a more casual approach to the dress code.

(Id.

at 127-28.)

With respect to advertisements, Nettles testified:

Q. Does anybody from the parent company need to review the material that’s incorporated in the advertising for Enterprise Pittsburgh?

A. Not review. At one point in time I did my own ads.

More recently, there is a department in St. Louis that has some creative people that are much smarter and can put together ads much better than I can, and I’ve elected to purchase those ads from them.

(Id.

at 146.)

Nettles testified that, despite the recommended job descriptions provided by ERAC-Missouri to the operating subsidiaries, “we don’t use a job description.” (Def.’s reply exhibit, Ex. 26 at 179.)

The sole members of the board of directors of ERAC-Pittsburgh were Nicholson, Snyder, and Taylor. (Ex. 4 ¶ 6 to Def.’s Br. Hickton.) The officers were Allen (vice president), Louis Guido (vice president), Mark Litow (“Litow”) (secretary), Nettles (vice president), Nicholson (president), and Snyder (vice president, as

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sistant secretary, and treasurer).

(Id.)

Taylor, Nicholson, and Snyder are directors and executives of defendant parent; Allen and Litow are executives of defendant parent. (Ex. 1 ¶ 4 to Def.’s Br. Hickton.)

The board of directors of ERAC-Pittsburgh functioned through written consents rather than formal meetings. (Ex. B at 172 to Pl.’s Br. Hickton;

see

Exs. J, K to Pl.’s Br. Hickton.) One consent was titled “Action by Joint Consent in Lieu of the October 2008 Annual Meeting of Shareholders and Organization Meeting of Board of Directors of Enterprise Renb-ACar Company of Pittsburgh.” (Ex. K to PL’s Br. Hickton.) The consents would sometimes involve and apply to a number of subsidiaries.

(See, e.g.,

Ex. J to PL’s Br. Hickton.) Over a four-year period, ten unanimous written consents were executed involving only ERAC-Pittsburgh, and two of those related to matters other than the appointment or resignation of officers. (Decl. of Gerald D. Wells, III ¶26 to PL’s Br. Hickton.) The directors of ERACPittsburgh decided quarterly on the amount of the dividend to be paid to ERAC-Missouri. (Ex. I at 11 to PL’s Reply Hickton; Ex. 1 ¶ 10 to Def.’s Br. Hickton.) As an officer of ERAC-Pittsburgh, Snyder, who also was an executive vice president, assistant secretary, and director of ERAC-Missouri, was authorized to open bank accounts for ERAC-Pittsburgh and transfer funds from ERACPittsburgh’s accounts. (Ex. 1 ¶ 4 to Def.’s Br. Hickton; Ex. 4 ¶ 14 to Def.’s Br. Hick-ton.)

Hickton was formerly an employee of ERAC-Pittsburgh. (Ex. 4 ¶ 10 to Def.’s Br. Hickton.) Hickton signed an acknowledgement that he was employed only by ERAC-Pittsburgh, and not ERAC-Missouri.

(See

Ex. 15 to Def.’s Br. Hickton.) The acknowledgement stated:

By signing below, I acknowledge the receipt of the

Enterprise Business Practice Guide, Personnel Policies and Benefits Summary Plan Description

effective January 1, 2006, and acknowledge that I have read and understand the practices, policies, and benefits addressed in this book, including the Acknowledgement section, and agree to its terms and conditions.

I additionally acknowledge that unless specifically employed and assigned to the corporate headquarters, I am employed only by the subsidiary or affiliate where hired or assigned and not employed by the corporate parent or any other related or affiliated company.

(Def.’s Br. Hickton, Ex. 15.)

When Hickton was promoted to branch manager for ERAC-Pittsburgh, he traveled to ERAC-Missouri’s offices for additional training. (Ex. F ¶ 5 to PL’s Reply Hickton.) When interviewing prospective employees, Hickton was directed to ask questions from an approved list supplied by the HR department.

(Id.

¶ 33.) Hick-ton was required to seek the input and authorization of his area manager or group rental manager before formally reprimanding an employee, and after giving a formal reprimand, he was required to contact the human resources department.

13

(Id.

¶¶ 51, 52.) The responsibility for employment decisions was held by the area manager, loss control manager, or human resources department,

14

and the loss con

*305

trol manager was primarily responsible for termination of employees.

(Id.

¶ 54.) Hickton was not empowered to hire or fire employees.

(Id.)

As an employee, Hickton believed that ERAC-Pittsburgh and ERAC-Missouri were one and the same.

(Id.

¶ 4.) All employees referred to ERACMissouri and the operating subsidiaries collectively, as “Enterprise.”

(Id.)

ERACPittsburgh sometimes advertised to the public as simply “Enterprise Renh-A-Car Company,” without reference to the Pittsburgh region.

(See

Ex. 6 at 145 to Def.)

H. ELC-Chicago

ELC-Chicago is a wholly owned operating subsidiary of ERAC-Missouri. (Ex. D ¶ 4 to Def.’s Br. Averill.) ELC-Chicago is organized and operated in a nearly identical manner to ERAC-Pittsburgh. ELC-Chicago maintains a headquarters in Lombard, Illinois, shares no offices or records with ERAC-Missouri, files its own annual reports, and at the time of the commencement of the action by Averill had its own articles of incorporation and bylaws. (Ex. G ¶¶ 5, 8 to Def.’s Br. Averill.) ELC-Chicago has the authority to make all general business decisions related to operations and financial dealings.

(Id.

at ¶¶ 9, 12.) ELC-Chicago pays ERAC-Missouri regular corporate dividends.

(Id.

¶ 13.)

At the time the complaint was filed by Averill, the sole members of the board of directors of ELC-Chicago were Nicholson, Snyder, and Taylor. (Ex. G ¶ 6 to Def.’s Br. Averill.) The officers were Litow (secretary), Nicholson (president), Snyder (treasurer, vice president, and assistant secretary), Loren Ahlgren (vice president), Michael Cruickshank (regional vice president), David Livon (“Livon”) (vice president), James McCarthy (regional vice president), Daniel Milwit (vice president), Steven Nelick (regional vice president), David Pepper (vice president), Denis Phelan (regional vice president), Brendon Ross (vice president), James Strack (regional vice president), and Jeffrey Wilder (vice president).

(Id.)

ELC-Chicago paid corporate dividends, authorized by its board of directors, to ERAC-Missouri. (Ex. D ¶ 9 to Def.’s Br. Averill.) Taylor, Nicholson, and Snyder served as directors of ERAC-Missouri and ELC-Chicago. (Ex. D ¶ 3 to Def.’s Br. Averill.) Taylor, Litow, Nicholson, Snyder, and Livon were executives of defendant parent and ELC-Chicago.

(Id.)

Averill had to submit his employment application via the Enterprise brand’s website. (Ex. 13 ¶ 4 to Pl.’s Br. Averill.) Ave-rill was formerly an employee of ELC-Chicago. (Ex. G ¶ 10 to Def.’s Br. Averill.) Averill signed an acknowledgement that he was employed only by ELC-Chicago, and not ERAC-Missouri.

(See

Ex. H to Def.’s Reply Averill.) The acknowledgement stated:

By signing below, I acknowledge the receipt of the

Enterprise Business Practice Guide, Personnel Policies and Benefits Summary Plan Description

effective January 1, 2006, and acknowledge that I have read and understand the practices, policies, and benefits addressed in this book, including the Acknowledgement section, and agree to its terms and conditions.

I additionally acknowledge that unless specifically employed and assigned to the corporate headquarters, I am employed only by the subsidiary or affiliate where hired or assigned and not employed by the corporate parent or any other related or affiliated company.

(Def.’s Reply Averill, Ex. H.)

Constance Powell (“Powell”), an opt-in plaintiff in the

Averill

action who worked at locations in Florida for almost three years, alleges she worked for defendant

*306

parent. (Ex. 14 ¶¶ 1-3, 8 to Pl.’s Br. Ave-rill.) After she was appointed branch manager at a branch in Florida, she attended a seminar with ERAC-Missouri in St. Louis. She asserted that Taylor was the chairman of ERAC-Missouri, and he stated that ERAC-Missouri’s risk management and compliance department was responsible for Enterprise Rent-A-Car’s national policies, procedures, and rules.

(Id.

¶ 4.) Powell stated she toured a “computer mainframe and it housed at least 100 towers,” and she alleged that she was told all computer activities were monitored by the mainframe and “everything computer related was handled by St. Louis.”

(Id.

¶ 5.) She stated that “[m]ultiple times a month we would receive emails from [ERACMissouri]’s St. Louis office.... These emails usually were directives to increase sales, budget reports, marketing reminders, reminders to review our mission statement, [and] emails requiring participation in the get green’ program.”

(Id.

¶ 6.) She averred:

At no time during my employment did I believe Enterprise Rent A Car company was not my employer. I know [ERACMissouri] was my employer. The interaction between my branches and Corporate St. Louis was seamless and continuous. Everything was monitored by St. Louis. In fact, my superiors stated even on “call back” notes in the system was had to be careful because if we typed disparaging comments about a[sic] unruly customer St. Louis would call and reprimand the superior.

(Id.

¶ 8.)

III. Applicable Law

In the context of multidistrict litigation, when analyzing claims arising under federal law, there is a preference for applying the law of the circuit in which the transferee court is located.

See In re Trade Partners, Inc., Investors Litig.,

Nos. 1:07-CV-738, 1:07-CV-750, 1:07-CV-775, 2008 WL 3979238 , at *2 (W.D.Mich. Aug. 22, 2008);

see also In re Comp. of Managerial, Prof'l and Technical Employees Antitrust Litig.,

No. 02-CV-2924, 2006 WL 38937 , at *2 (D.N.J. Jan. 5, 2006) (“the transferee court [should] be free to decide a federal claim in the manner it views as correct without deferring to the interpretation of the transferor circuit.”). When analyzing claims under state law, “the transferee court must apply the state law that would have applied had the cases not been transferred for consolidation.’ ”

In re Genetically Modified Rice Litig.,

576 F.Supp.2d 1063, 1077 (E.D.Mo.2008) (quoting

In re Gen. Am. Life Ins. Co. Sales Practices Litig.,

391 F.3d 907, 911 (8th Cir.2004)).

The parties do not dispute that precedential opinions of the Court of Appeals for the Third Circuit are consistent with the law of the transferor forums. The court will follow precedential decisions of the Court of Appeals for the Third Circuit with respect to the federal questions presented. To the extent the parties cited case law of the Court of Appeals of the Seventh Circuit and made arguments based upon that law, there are no apparent outcome-determinative differences between the decisions of the Courts of Appeals for the Third Circuit and the Seventh Circuit.

IV. Motion to Dismiss for Lack of Personal Jurisdiction

A. Standard of Review for Motion to Dismiss for Lack of Personal Jurisdiction

A motion to dismiss pursuant to Rule 12(b)(2) of The Federal Rules of Civil Procedure challenges the ability of a court to exercise jurisdiction over a party to the dispute. If a jurisdictional defect exists,

*307

the court lacks the power to adjudicate effectively the controversy.

See Flood v. Braaten,

727 F.2d 303 , 306 n. 12 (3d Cir.1984) (“because he lacks minimum contacts’ with [the forum], the district court cannot assert jurisdiction over his person ____”);' Eugene F. Scoles & Peter Hay, Conflict of Laws at 263 (2d ed.1992). “When a defendant raises the defense of the court’s lack of personal jurisdiction, the burden falls upon the plaintiff to come forward with sufficient facts to establish that jurisdiction is proper.”

Mellon Bank (East) PSFS v. Farino,

960 F.2d 1217, 1223 (3d Cir.1992). “If the court elects not to hold a pre-trial evidentiary hearing on the issue of personal jurisdiction, the non-moving party may meet its burden by presenting a

prima facie

case in support of the exercise of personal jurisdiction over the moving party.”

Joint Stock Soc. v. Heublein, Inc.,

936 F.Supp. 177, 192 (D.Del.1996) (citing

Mellon Bank (East),

960 F.2d at 1223 ).

The parties in this case were afforded jurisdictional discovery and the court must look beyond the allegations in the pleadings in assessing whether plaintiffs presented a prima facie case:

A Rule 12(b)(2) motion, such as the motion made by the defendants here, is inherently a matter which requires resolution of factual issues outside the pleadings, i.e. whether in personam jurisdiction actually lies. Once the defense has been raised, then the plaintiff must sustain its burden of proof in establishing jurisdictional facts through sworn affidavits or other competent evidence.... [A]t no point may a plaintiff rely on the bare pleadings alone in order to withstand a defendant’s Rule 12(b)(2) motion to dismiss for lack of in personam jurisdiction.

Time Share Vacation Club v. Atlantic Resorts, Ltd.,

735 F.2d 61 , 66 n. 9 (3d Cir. 1984) (citing

Int’l Ass’n of Machinists & Aerospace Workers v. Northwest Airlines, Inc.,

673 F.2d 700 (3d Cir.1982)). “In other words, the nonmoving party must base its

prima fade

showing

of

personal jurisdiction over the moving party on evidence of specific facts set out in the record.”

Joint Stock Soc.,

936 F.Supp. at 192 (citing

Boit v. Gar-Tec Prods., Inc.,

967 F.2d 671, 675 (1st Cir.1992)). Any conflicts between the evidence submitted by the plaintiff and the defendant must be construed in the plaintiffs favor.

Barrett v. Catacombs Press,

44 F.Supp.2d 717, 722 (E.D.Pa.1999). Eventually, the plaintiff must establish in personam jurisdiction by a preponderance of the evidence:

If the nonmoving party succeeds in presenting a

prima facie

case based on its proffered evidence, the court may order an evidentiary hearing or deny the motion to dismiss. If the court denies the motion to dismiss based on the

prima facie

standard, the moving party later may raise again the issue of the exercise of personal jurisdiction over it. Eventually, the nonmoving party must establish by a preponderance of the evidence, either at a pre-trial hearing or at trial, that the exercise of personal jurisdiction over the moving party is proper.

Joint Stock Soc.,

936 F.Supp. at 193 (internal citations omitted).

B. Discussion

In cases where subject-matter jurisdiction is based upon a federal question arising under a statute and that statute is silent regarding service of process, Rule 4(e) of the Federal Rules of Civil Procedure provides that a federal district court may exercise personal jurisdiction over a nonresident defendant to the extent authorized by the law of the forum state in which it sits.

Provident Nat’l Bank v. Cal. Fed. Sav. & Loan Ass’n,

819 F.2d 434 , 436

*308

(3d Cir.1987);

Eason v. Linden Avionics, Inc.,

706 F.Supp. 311, 327 (D.N.J.1989). The FLSA is silent regarding service of process, and the court must look to state law in this situation.

See Aviles v. Kunkle,

978 F.2d 201, 204 (5th Cir.1992).

Pennsylvania’s long-arm statute allows a court to exercise personal jurisdiction over a person “to the fullest extent allowed under the Constitution of the United States and may be based on the most minimum contact with this Commonwealth allowed under the Constitution of the United States.” 42 Pa. Cons.Stat. § 5322(b). The statute is coextensive with the due process clause of the Fourteenth Amendment to the United States Constitution.

Dollar Sav. Bank v. First Sec. Bank of Utah,

746 F.2d 208 , 211 (3d Cir.1984).

Illinois’ long-arm statute grants a court personal jurisdiction over a person “on any other basis now or hereafter permitted by the Illinois Constitution and the Constitution of the United States.” 735 III. Comp. Stat. 5/2-209(c). Like the Pennsylvania long-arm statute, the Illinois long-arm statute is coextensive with the due process clause of the Fourteenth Amendment to the United States Constitution.

See Hyatt Int’l Corp. v. Coco,

302 F.3d 707, 714-16 (7th Cir.2002).

The due process clause of the Fourteenth Amendment prohibits the exercise of personal jurisdiction over a nonresident defendant unless that defendant has “minimum contacts” with the forum state in order that “ ‘the maintenance of the suit does not offend traditional notions of fair play and substantial justice.’ ”

Int’l Shoe Co. v. Washington,

326 U.S. 310, 316 , 66 S.Ct. 154 , 90 L.Ed. 95 (1945). Due process “protects an individual’s liberty interest in not being subject to the binding judgments of a forum with which he has established no meaningful contacts, ties, or relations.’ ”

Burger King Corp. v. Rudzewicz,

471 U.S. 462, 471-72 , 105 S.Ct. 2174 , 85 L.Ed.2d 528 (1985) (quoting

Int’l Shoe Co.,

326 U.S. at 319 , 66 S.Ct. 154 ). There are two situations in which personal jurisdiction may be exercised over a nonresident defendant. The first, general jurisdiction, arises out of “continuous and substantial forum affiliations,” and it may be exercised when the claims do not arise out of the defendant’s activities within the forum state.

Dollar Sav. Bank,

746 F.2d at 212. In contrast, specific jurisdiction “is invoked when the cause of action arises from the defendant’s forum related activities,” and, in such a case, the focus is on the minimum contacts between the nonresident defendant and the forum.

Id.

at 211-12. Specific jurisdiction requires “some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws.”

Hanson v. Denckla,

357 U.S. 235, 255 , 78 S.Ct. 1228 , 2 L.Ed.2d 1283 (1958).

Hickton and Averill advance three theories in support of the court’s exercise of personal jurisdiction over defendant parent: (A) the court has general jurisdiction, (B) the operating subsidiaries are the alter egos of ERAC-Missouri, and (C) the court has specific jurisdiction. The arguments of Hickton and Averill will be separately considered.

C. Motion to Dismiss With Respect to Hickton’s Complaint

1. General Jurisdiction

General jurisdiction exists when the defendant has continuous and systematic contacts with the forum state.

Helicopteros Nacionales de Colombia, S.A. v. Hall,

466 U.S. 408, 414-15 , 104 S.Ct. 1868 , 80 L.Ed.2d 404 (1984);

see Feldman v. Bally’s Park Place, Inc.,

No. 05-5345, 2006 WL 1582331 , at *2 (E.D.Pa. June 5, 2006)

*309

(“Federal courts sitting in Pennsylvania consider the following objective criteria in ascertaining the existence of general jurisdiction: (1) whether defendant is incorporated or licensed to do business in Pennsylvania; (2) whether the defendant has ever filed any tax returns with the Commonwealth of Pennsylvania; (3) whether the defendant files administrative reports with any agency or department of the Commonwealth .... ”). To determine whether a defendant conducted a continuous and systematic part of its business in the forum state, it is necessary to look at the defendant’s activities within the state over a period of time.

Modern Mailers, Inc. v. Johnson & Quin, Inc.,

844 F.Supp. 1048, 1052 (E.D.Pa.1994). The evidence required to establish general jurisdiction must be considerable.

See Reliance Steel Prods. Co. v. Watson, Ess, Marshall & Enggas,

675 F.2d 587, 589 (3rd Cir.1982) “[Tjhis is a much higher threshold to meet for the facts required to assert this general’ jurisdiction must be extensive and persuasive.’ ”

Id.

(quoting

Compagnie des Bauxites de Guinea v. Ins. Co. of N. Am.,

651 F.2d 877, 890 (3d Cir.1981) (Gibbons, J., dissenting)).

a. Filing of Certificate of Authority

Hickton explained in a footnote in his reply memorandum of law that on July 30, 2008, ERAC-Missouri filed a certificate of authority with the Secretary of State of Pennsylvania. At oral argument, the issue arose whether the filing of the certificate conferred personal jurisdiction over defendant parent. The Court of Appeals for the Third Circuit has held that a Pennsylvania court can exercise personal jurisdiction over a corporation that filed for and received authorization to engage in business in Pennsylvania.

Bane v. Netlink, Inc.,

925 F.2d 637, 640 (3d Cir.1991). The court of appeals specifically based its holding upon a section of Pennsylvania’s long-arm statute that is distinct from the section that is coextensive with the due process clause of the Fourteenth Amendment. The section relied upon in

Bane

was 42 Pa. Cons.Stat. § 5301, which provides:

(a) General Rule. — The existence of any of the following relationships between a person and this Commonwealth shall constitute a sufficient basis of jurisdiction to enable the tribunals of this Commonwealth

to exercise general personal jurisdiction

over such person, or his personal representative in the case of an individual, and to enable such tribunals to render personal orders against such person or representative:

(2) Corporations.—

(i) Incorporation under or

qualification as a foreign corporation under the laws of this Commonwealth.

(ii)

Consent,

to the extent authorized by the consent.

(b) Scope of jurisdiction. — When jurisdiction over a person is based upon this section any cause of action may be asserted against him, whether or not arising from acts enumerated in this section. Discontinuance of the acts enumerated in subsection (a)(2)(i) and (iii) and (3)(i) and (iii) shall not affect jurisdiction with respect to any act, transaction or omission

occurring during the period such status existed.

42 Pa. Cons.Stat. § 5301 (emphasis added). The court of appeals held that general jurisdiction existed over the corporate defendant in

Bane

either under subsection (a)(2)®, since it was a qualified foreign corporation by reason of its authorization to conduct business in Pennsylvania, or under subsection (a)(2)(h), since the certificate of authority can be viewed as consent to be sued in Pennsylvania.

Bane,

925 F.2d at 640-41 . Authorization to do busi

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ness in Pennsylvania, even if the only contact with the state, is sufficient for a Pennsylvania court to exercise jurisdiction.

Eagle Traffic Control, Inc. v. James Julian, Inc.,

933 F.Supp. 1251, 1256 (E.D.Pa.1996).

ERAC-Missouri’s authorization pursuant to the certificate of authority would serve as a ground upon which this court could exercise in personam jurisdiction over ERAC-Missouri; provided, that the certificate of authority is a relevant contact that can be considered by the court in this situation. Defendant argues that the filing of the certificate of authority is not a relevant contact, because contacts between the party and the forum after the complaint was filed are beyond the temporal scope of the personal jurisdictional analysis.

Under the traditional consent theory of jurisdiction, there is no specific time period in which consent or waiver must occur:

a party’s consent to a court’s jurisdiction may take place prior to the suit’s institution ..., or at the time suit is brought ..., or after suit has started. And having objected to the absence of in person-am jurisdiction, a defendant may rescind the objection, i.e., consent to the forum court’s jurisdiction, at any stage of the proceedings.

Gen. Contracting & Trading Co. v. Interpole, Inc.,

940 F.2d 20, 22 (1st Cir.1991) (internal citations omitted). Jurisdiction based upon a certificate of authority in Pennsylvania, however, is limited by the section of Pennsylvania’s long-arm statute that is at issue here.

See Bane,

925 F.2d at 641 . That section provides that jurisdiction is only “to the extent authorized by the consent.” 42 Pa. Cons.Stat. § 5301(b)(ii). When consent-based jurisdiction is grounded upon a certificate of authority, there is an apparent temporal limit. The statute provides that if the certificate of authority is withdrawn, general jurisdiction only exists over acts or transactions occurring during the period of authorization.

See

42 Pa. Cons.Stat. § 5301(b)®. In this case, defendant parent represented that on July 30, 2008 it inadvertently registered with the Pennsylvania Department of State, and, after becoming aware of the mistake on June 1, 2009, it withdrew the registration. The complaint was filed by Hickton on December 11, 2007. The commencement of the action predates the time period in which defendant parent was registered in Pennsylvania. The actions that underlie this lawsuit, therefore, occurred outside of the time period in which defendant parent was authorized to do business, and 42 Pa. Cons. Stat. § 5301 does not provide a basis for personal jurisdiction.

b. Other Contacts

i. Time Period in Which Relevant Contacts Are Assessed

The question remains whether contacts after the filing of the complaint are to be considered in determining whether general jurisdiction exists under Pennsylvania’s general long-arm statute. Pennsylvania courts may exercise jurisdiction over any party “not within the scope of section 5301 ... to the fullest extent allowed under the Constitution of the United States.” 42 Pa. Cons.Stat. § 5322(b). Hickton points to contacts with Pennsylvania occurring after the filing of his lawsuit that he argues are relevant in assessing whether defendant parent has continuous and systematic contacts for purposes of general jurisdiction under § 5322. Besides the business certificate, Hickton points to defendant parent hosting the Enterprise Ren1>-A-Car website after the lawsuit was initiated.

Hickton cites two decisions in support of consideration of contacts after the filing of

*311

the complaint:

Educational Testing Service v. Katzman,

631 F.Supp. 550, 556 (D.N.J.1986), and

McMullen v. European Adoption Consultants, Inc.,

109 F.Supp.2d 417, 420 (W.D.Pa.2000). In

Katzman ,

the district court observed:

The due process limitations on a court’s personal jurisdiction over nonresident defendants is meant to ensure that individuals have “fair warning that a particular activity may subject [them] to the jurisdiction of a foreign sovereign [thus giving] a degree of predictability to the legal system that allows potential defendants to structure their primary conduct with some minimum assurance as to where that conduct will and will not render them liable to suit [citations omitted].”

[Burger King Corp.,

471 U.S. at 472 , 105 S.Ct. 2174 ]. Once a defendant has been served with a complaint, he is on notice that he may be subject to jurisdiction in that forum. At that time, perhaps more than at any other, the defendant who wishes to contest jurisdiction, frequently on the advice of lawyers, begins ordering his affairs to show that he has no contacts with the forum state.

To use the date of the filing of a complaint in most cases seems appropriate so that a defendant may not avoid liability by removing himself from the jurisdiction. However, that moment in time should not be graven in stone particularly where, as here, the defendant has subsequent to the filing of a complaint established a continuous and systematic presence in the forum state. To permit the filing of a complaint to limit jurisdiction by immunizing a defendant’s future actions in the forum state when those actions are a mere continuation of those underlying the complaint would make no sense. Moreover, I fail to see any due process interest which would be served by such immunity.

Katzman,

631 F.Supp. at 556 . Although the court used language supporting the exercise of general jurisdiction (e.g. “continuous and systematic presence in the forum state”), the court in

Katzman

specifically addressed the concepts of “relating to” or “arising out of’ which relate to specific jurisdiction.

Id.

at 554-55, 560 .

Hickton also cites

McMullen .

In that case, the parents of an adopted child sued the adoption agency for breach of contract and related tort claims, due to the child’s medical condition.

McMullen,

109 F.Supp.2d at 418 . The court held the parents would be entitled to jurisdictional discovery of contacts during the time period after the 1992 adoption, stating that the “absence of a bright-line rule establishing a temporal framework for the minimum contacts analysis strongly reinforces the fact-specific, case-by-case nature of all jurisdictional analysis. We are persuaded that a broader timeframe, encompassing the time the complaint was filed, is appropriate here.”

Id.

at 420 .

Defendant parent cites a number of decisions which support its position that post-complaint contacts are irrelevant to the analysis.

See, e.g., Harlow v. Children’s Hosp.,

432 F.3d 50, 65 (1st Cir.2005);

Noonan v. Winston Co.,

135 F.3d 85, 95 (1st Cir.1998);

Metro. Life Ins. Co. v. Robertson-Ceco Corp.,

84 F.3d 560, 569-70 (2d Cir.1996);

Feldman,

2006 WL 1582331 , at *2 n. 3;

Fiacco v. Sigma Alpha Epsilon Fraternity,

No. Civ. 1:05-145-GZS, 2006 WL 890686 , at *5 n. 6 (D.Me. Mar. 31, 2006);

United Phosphorus, Ltd. v. Angus Chem. Co.,

43 F.Supp.2d 904, 910 (N.D.Ill.1999);

CIVIX-DDI LLC v. Microsoft Corp.,

No. 99-B-172, 1999 WL 1020248 , at *1508 (D.Colo. Oct. 1, 1999).

In

United Phosphorus,

the plaintiffs brought an antitrust action claiming that the defendants conspired to prevent the

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plaintiffs from entering the market for production of chemicals used in a certain prescription drug. Defendant Lupin Laboratories moved to dismiss for lack of personal jurisdiction. The complaint was filed in the Northern District of Illinois on April 4, 1994, and the district court refused to consider contacts with Illinois after that date. The court noted that the case involved

specific

jurisdiction because Lupin Laboratories’ contacts with Illinois arose from the alleged involvement in a conspiracy with the other defendants, and in the context of specific jurisdiction:

The focus on whether a defendant has purposefully availed itself of the privilege of conducting activities in the forum state necessarily implies that only conduct prior to the accrual of the cause of action or, at the very latest, the filing of the lawsuit is relevant. In other words, “purposeful availment” implies that the defendant, as shown by its activities, intended to be amenable to suit in the forum state. Conduct post-dating the filing of a complaint by definition cannot show that, when the defendant engaged in the post-complaint acts purportedly supporting jurisdiction, it intentionally exposed itself to the possibility of an event which had already occurred (the filing of a complaint in the forum state).

United Phosphorus,

43 F.Supp.2d at 908 .

The court rejected the plaintiffs’ request to consider post-complaint contacts for three reasons. First, the plaintiffs failed to cite any case law that supported the theory that all contacts, regardless whether they are pre- or post-suit, are jurisdictionally relevant.

Id.

at 910 . Second, the plaintiffs failed to cite any case law that supported the court’s ability to exercise jurisdiction (either general or specific) over a defendant where the events supporting jurisdiction occurred after the filing of the complaint.

Id.

Third,

the rules regarding personal jurisdiction are founded on the Due Process Clause, which requires that an individual have “fair warning” that a particular activity may subject it to the jurisdiction of the forum state.

See, e.g., [Burger King Corp.,

471 U.S. at 472 , 105 S.Ct. 2174 ]. While pre-suit activities may rise to the level of a “fair warning” that a defendant may be haled into a court in the forum state, post-suit activities cannot serve to warn the defendant of an event that has already occurred. The fact that the complaint alleges that the conspiracy continues to this day, therefore, is not jurisdictionally significant.

Id.

The only decision cited by either party that examines in detail the relevant legal concepts with respect to

general

jurisdiction is

Metropolitan Life.

In that decision, the court considered the defendant’s argument that the evaluation of continuous and systematic contacts should only focus upon those contacts with the forum during the year in which the complaint was filed. The plaintiff argued for a broader time period, going back six years from the date of the filing of the complaint. The court noted that the Supreme Court considered contacts with the forum state over a seven-year period in

Helicópteros,

and recognized that the “phrase continuous and systematic’ necessarily requires that courts evaluate the defendant’s contact with the forum state over time.”

Metro. Life Ins. Co.,

84 F.3d at 569 . The court concluded “[i]n general jurisdiction cases, district courts should examine a defendant’s contacts with the forum state over a period that is reasonable under the circum

stances

— up

to and including the date the suit was filed

— to assess whether they satisfy the continuous and systematic’ standard.”

Id.

at 569-70 (emphasis added).

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In

CIVIX-DDI,

the underlying contact asserted to support personal jurisdiction was the defendant’s acquisition on May 27, 1999 of a ten percent equity stake in a corporation based in Colorado, the forum state. The lawsuit was filed on January 26, 1999. The court refused to consider the acquisition for purposes of general jurisdiction, because this contact post-dated the initiation of the lawsuit. The court did not analyze the issue, but quoted several decisions including

Metropolitan Life. CI-VIX-DDI LLC,

1999 WL 1020248 , at *1508.

Although the court in

Metropolitan Life

stated that the temporal scope of general jurisdiction ends at the time of the complaint, there was no issue in that case with respect to whether contacts

after

the complaint should be considered. The Court of Appeals for the Second Circuit in

Metropolitan Life

commented that the court is bestowed with significant flexibility: “[t]he minimum contacts inquiry is fact-intensive, and the appropriate period for evaluating a defendant’s contacts will vary in individual cases.... The determination of what period is reasonable in the context of each case should be left to the court’s discretion.”

Metro. Life Ins. Co.,

84 F.3d at 569 .

Both

Katzman

and

United Phosphorus

involved the same issue — whether a court can consider post-complaint contacts in analyzing specific jurisdiction. The courts in the two decisions, relying upon the same language in

Burger King,

reached opposite conclusions. In

Katzman ,

the court considered post-complaint conduct, stating that once a defendant corporation is served with a complaint, it has fair notice that it may be subject to jurisdiction in the forum, and should accordingly structure its behavior.

Katzman,

631 F.Supp. at 556 . In

United Phosphorus,

the court did not consider post-complaint conduct, stating that such activities cannot provide “fair warning.”

United Phosphorus,

43 F.Supp.2d at 910 . This court need not resolve the conflict because, even taking into consideration defendant parent’s post-lawsuit contacts, Hickton did not adduce evidence of sufficient contacts with Pennsylvania to establish general personal jurisdiction.

ii. Analysis of the Contacts

Hickton argues ERAC-Missouri has continuous and systematic contacts with Pennsylvania through its (a) contact centers, (b) business conducted in the state, (c) interactive website, and (d) advertisements.

Until January 2008, ERAC-Missouri operated a contact center. It reached out to prospective customers on a nationwide basis with a toll-free telephone number, and all calls to this number were dealt with by the contact center. Customers were assisted by representatives at the contact center, and, if further assistance was necessary, the calls could be directed to an individual branch location, including those branch locations operated by ERAC-Pittsburgh.

Hickton argues that ERAC-Missouri conducted business in Pennsylvania. ERAC-Missouri solicited business from Pennsylvania residents and businesses, using its national marketing department. ERAC-Missouri also operated various “booking channels” to facilitate automobile rentals. One such booking channel is the enterprise.com website that individuals can use to reserve vehicle rentals. Another booking channel is ARMS, used by insurance companies to reserve vehicle rentals. Defendant parent also uses third-party booking channels that enable customers to reserve rental vehicles via travel websites such Travelocity.com and Orbitz.com. In

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addition, ERAC-Missouri was authorized to do business in Pennsylvania for a limited period of time after the complaint was filed in this case.

15

The Enterprise brand’s website, enterprise.com, is highly interactive and commercial in nature. Pennsylvania residents can create reservations at branch locations in Pennsylvania. ERAC-Missouri’s e-commerce team is responsible for the content of the website; ERAC-Pittsburgh does not maintain any hyperlinked websites or webpages. Hickton alleges that Pennsylvania residents are specifically targeted by the website, because, by providing the ability to reserve automobiles at Pennsylvania branch locations, the site is specifically tailored to the needs of Pennsylvania residents.

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ERAC-Missouri’s marketing and communications division provides subsidiaries with a variety of marketing materials, including advertisements and promotional materials. Hickton notes that the advertisements provided to subsidiaries portray Enterprise Rent-A-Car as a unified company. In order for a subsidiary to refrain from participating in a promotional campaign, the subsidiary must advise the contact centers of its intention to do so. Mar Com also creates the advertisements displayed on the enterprise.com website.

Defendant parent argues that Hickton failed to meet the substantial burden of establishing general jurisdiction. The continuous and systematic contacts necessary to establish general jurisdiction must be a central part of the defendant’s business.

Provident Nat’l Bank,

819 F.2d at 437-38 ; see

Fisher v. Teva PFC SRL,

212 Fed.Appx. 72, 75 (3d Cir.2006) (“The contacts must also be a central part of the defendant’s business.”). Defendant parent notes that the Court of Appeals for the Third Circuit has on multiple occasions rejected the contention that general jurisdiction arises from a website.

See, e.g., Kehm Oil Co. v. Texaco, Inc.,

537 F.3d 290, 300 (3d Cir.2008). Defendant parent argues that the subsidiaries set rules and rates for vehicle rentals and communicate those rules and rates to ERAC-Missouri’s IT specialists who maintain the website. Defendant parent asserts the contact center’s primary purpose is to accept phone calls and to place reservations on behalf of the operating subsidiaries. The operating subsidiaries are not required to use the services of the contact center, and must pay a fee for its use. Defendant parent contends that the booking channels merely direct potential customers to the operating subsidiaries, and the business transactions are between the customers and subsidiaries. With respect to the advertisements, defendant parent argues that advertisements in broadly-circulated publications do not establish continuous and systematic contacts with a specific forum.

The court must collectively look at all defendant parent’s contacts. Often the evidence offered by a plaintiff when viewed in isolation is not sufficient to confer general jurisdiction over a corporation, but if viewed in conjunction with all the evidence presented it may be sufficient.

See Forest Labs. Inc. v. Cobalt Labs. Inc.,

No. 08-21-GMS-LPS, 2009 WL 605745 , at *8 (D.Del. Mar. 9, 2009) (considering the proffered contacts collectively). Even viewing all evidence collectively, however, the court does not find that defendant parent’s contacts are sufficiently substantial and continual to render the exercise of personal jurisdiction reasonable in this situation. The burden of establishing general jurisdiction is “rigorous.”

Wartsila NSD N. Am., Inc. v. Hill Int'l Inc.,

269 F.Supp.2d 547, 553 (D.N.J.2003);

see Saudi v. Acomarit Maritimes Services, S.A.,

114 Fed.Appx. 449, 453 (3d Cir.2004) (“The standard for evaluating whether minimum contacts satisfy the test for general jurisdiction is more stringent than the test applied to questions of specific jurisdiction.”).

With respect to defendant parent’s website, the court notes that the website is for the Enterprise brand. The website is not specific to either ERACMissouri or the operating subsidiaries, but instead portrays Enterprise Rent-A-Car as a single company. The significance in this portrayal is minimal, because, in the context of general jurisdiction, the issue is whether the website targets Pennsylvania or is related to defendant parent’s business activities in Pennsylvania.

16

“Where

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a website is interactive and general jurisdiction is at issue, the court must analyze whether the website is targeted specifically to Pennsylvanians and whether the website is central to the defendant’s business in Pennsylvania.”

Mueller v. Sunshine Rest Merger Sub LLC,

No. 1:09-CV-0443, 2009 WL 1107263 , at *3 (M.D.Pa. Apr. 23, 2009) (citing

Haas v. Four Seasons Campground, Inc.,

952 A.2d 688, 695 (Pa.Super.Ct.2008));

see O’Connor v. Sandy Lane Hotel Co.,

No. Civ.A. 04-2436, 2005 WL 994617 , at *3 (E.D.Pa. Apr. 28, 2005)

(“O’Connor I”), rev’d with respect to specific jurisdiction,

496 F.3d 312, 317 (3d Cir.2007)

(“O’Connor II”); see also

16 James Wm. Moore, Moore’s Federal Practice § 208.44[3] at 108-90 to 108-90.1 (3d ed.2009) (“When an internet website is coupled with substantial business activity in the forum state, general jurisdiction may be found to exist.”).

There is no evidence of record that the website specifically targets Pennsylvania residents. Instead, the website is akin to an advertisement in an international publication. The website is central to ERACPittsburgh’s business in Pennsylvania, since customers can reserve automobiles for rent via the website. The website is not central, however, to ERAC-Missouri’s business, since ERAC-Missouri is a holding company that provides administrative services to its operating subsidiaries, but does not rent automobiles. For similar reasons, the significant interactive features of the website foster interactivity between Pennsylvania residents and the operating subsidiaries, and not between Pennsylvania residents and defendant parent.

See In re Nazi Era Cases Against German Defs. Litig.,

320 F.Supp.2d 204, 220 (D.N.J.2004) (holding that the parent’s website, “which serves as a shopping portal’ that allows customers to transact business with and purchase goods from [the parentj’s subsidiaries,” did not establish personal jurisdiction);

Carpenter v. Exelon Corp.,

No. 14-07-00149-CV, 2007 WL 3071998 , at *3 n. 11 (Tex.App. Oct. 23, 2007) (although customers could engage in online transactions with subsidiaries through a website owned and operated by the parent, “the use of the website by [the parent’s subsidiaries generally cannot be imputed to [the parent] to establish personal jurisdiction over [the parent]” since separate corporations are presumed to be distinct entities). The court concludes that the jurisdictional significance of the website is limited.

With respect to the contact centers, “there can be no dispute that the maintenance of a toll-free number is not a forum contact significant or continuous enough to ground general jurisdiction.”

O’Connor I,

2005 WL 994617 , at *4. The contact centers serve a function almost identical to the website, because those centers direct customers to operating subsidiaries with whom the customers can reserve rental vehicles.

The court concludes that the booking channels are subject to an analysis comparable to that applied to the website. Even though the booking channels are maintained by defendant parent, the channels are used to arrange rental reservations. The arranged-for transaction takes place between the customer and subsidiary — not between the customer and defendant parent. Defendant parent’s maintenance of the booking channels might be a contact with Pennsylvania, but the significance of

*317

the contact is limited, since the major business activity of the booking channels is between Pennsylvania residents and the operating subsidiaries.

With respect to the advertisements created by defendant parent’s Mar Com division, there is no evidence of record that the content of the advertisements directly targeted Pennsylvania residents. General advertising in a medium that reaches a widespread audience does not constitute continuous and systematic contact with Pennsylvania.

Gehling v. St. George’s Sch. of Med., Ltd.,

773 F.2d 539 , 542 (3d Cir.1985) (refusing to exercise general jurisdiction over a medical school that sent representatives on a media tour to appear on Pennsylvania radio and television shows in order to gain exposure, and also holding “[t]he

New York Times

and

Wall Street Journal

are non-Pennsylvania newspapers with international circulations, and advertising in them does not constitute continuous and substantial’ contacts with the forum state”). The advertisements were used to promote the automobile rental business, which is the business in which the operating subsidiaries engage, not defendant parent.

Viewing all the evidence as a whole, the court finds that defendant parent’s contacts with Pennsylvania are not sufficiently substantial and continuous to permit the exercise of personal jurisdiction over defendant parent in Pennsylvania.

2. Alter-Ego Theory

There is no dispute that this court may exercise both specific and general personal jurisdiction over ERAC-Pittsburgh. This court would have jurisdiction over ERACMissouri, if ERAC-Pittsburgh’s actions are attributable to ERAC-Missouri.

When a subsidiary of a foreign corporation is carrying on business in a particular jurisdiction, the parent company is not automatically subject to jurisdiction in that state because of the presumption of corporate separateness. Thus, if the subsidiary’s presence in the state is primarily for the purpose of carrying on its own business and the subsidiary has preserved some semblance of independence from the parent and is not acting as merely one of its departments, personal jurisdiction over the parent corporation may not be acquired simply on the basis of the local activities of the subsidiary company. The very nature of these often very difficult issues makes their resolution extremely fact dependent.

[I]f the subsidiary's] ... separate corporate status is formal only and without any semblance of individual identity, then the subsidiary’s business will be viewed as that of the parent and the latter will be said to be doing business in the jurisdiction through the subsidiary for purposes of asserting personal jurisdiction.

4A Charles Alan Wright

&

Arthur R. Miller, Federal Practice and Procedure § 1069.4 at 163-64, 74 (3d ed.2002). This concept is known as the alter-ego theory, and has been utilized by courts in this jurisdiction to determine whether a court may exercise personal jurisdiction over a foreign parent corporation.

See, e.g., Square D Co. v. Scott Elec. Co.,

No. 06-00459, 2008 WL 2704583 , at *2 (W.D.Pa. July 7, 2008).

Whether the exercise of jurisdiction over a parent corporation is proper under the alter-ego theory depends upon the details of the unique relationship between the parent corporation and its subsidiary.

See Bulova Watch Co. v. K. Hattori & Co.,

508 F.Supp. 1322, 1334 (E.D.N.Y.1981). The parent-subsidiary relationship itself is not sufficient to es

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tablish in personam jurisdiction over the parent entity. In

Botwinick v. Credit Exchange, Inc.,

419 Pa. 65 , 213 A.2d 349, 353 (1965), the Pennsylvania Supreme Court relied on

Cannon Manufacturing Co. v. Cudahy Packing Co.,

267 U.S. 333 , 45 S.Ct. 250 , 69 L.Ed. 634 (1925), in determining whether personal jurisdiction existed. The Pennsylvania Supreme Court discussed the background of

Cannon Manufacturing:

Cannon sued Cudahy Packing Company, a Maine corporation, in North Carolina. Service of process was made in North Carolina upon Cudahy Packing Company of Alabama, a subsidiary of the Maine corporation. To show the Maine corporation was doing business in North Carolina, Cannon sought to show the identity pro hac vice between the Maine and Alabama corporations. The Maine corporation owned all the capital stock of the Alabama corporation and ‘the [Maine corporation] dominate[d] the [Alabama corporation], immediately and completely’; the Alabama corporation marketed the products of the Maine corporation not as agent but as a subsidiary and bought such products from the Maine corporation and sold such products to dealers. Each corporation maintained its corporate identity separately and distinctly. The United States Supreme Court, speaking through the late Mr. Justice Brandéis, refused to ignore the corporate existence, carefully maintained, in determining the existence of jurisdiction and set aside the service made on the subsidiary corporation, stating, inter alia: ‘[S]uch use of a subsidiary does not necessarily subject the parent corporation to the jurisdiction’ of North Carolina and ‘The corporate separation, though perhaps merely formal, was real. It was not pure fiction[.]’

Botwinick,

213 A.2d at 353 (internal citations omitted).

Courts which apply the rationale of

Cannon

require the demonstration of a relationship beyond the mere parent-subsidiary association in order for the exercise of jurisdiction over the parent to be constitutionally permissible. To prevail under the alter-ego theory, a plaintiff must demonstrate that “[t]he degree of control exercised by the parent [is] greater than normally associated with common ownership and directorship.”

In re Latex Gloves Prods. Liab. Litig.,

No. MD L 1148, 2001 WL 964105 , at *3 (E.D.Pa. Aug. 22, 2001). “Plaintiffs must prove that 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.”

Id.

Courts have applied a variety of tests in evaluating the control of the parent over the subsidiary, demonstrating that “the issue may best be dealt with using a flexible, case-by-case standpoint.”

Id.

A ten-factor test offers a “discretely individuated and functional framework for this analysis.”

Id.

The ten factors include whether:

(1) the parent owns all or a significant majority of the subsidiary’s stock,

(2) commonality of officers or directors exists between the two corporations,

(3) the corporate family possesses a unified marketing image, including common branding of products,

(4) corporate insignias, trademarks, and logos are uniform across corporate boundaries,

(5) corporate family members share employees,

(6) the parent has integrated its sales and distribution systems with those of its subsidiaries,

(7) the corporations exchange or share managerial or supervisory personnel,

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(8) the subsidiary performs business functions that would ordinarily be handled by a parent corporation,

(9) the parent uses the subsidiary as a marketing division or as an exclusive distributor, and

(10) the parent exercises control or provides instruction to the subsidiary’s officers and directors.

In re Chocolate Confectionary Antitrust Litig.,

602 F.Supp.2d 538, 569-70 (M.D.Pa.2009)

(“Chocolate Confectionary

7”) (citing

Simeone ex rel. Estate of Albert Francis Simeone, Jr. v. Bombardier-Rotax GmbH,

360 F.Supp.2d 665, 675 (E.D.Pa.2005);

Directory Dividends, Inc. v. SBC Commc’ns, Inc.,

No. 01-CV-1974, 2003 WL 21961448 , at *3 (E.D.Pa. July 2, 2003)).

“Whether or not the court would pierce the corporate veil and impose liability on the parent for activities of the subsidiary is not the issue here.”

Bulova Watch Co.,

508 F.Supp. at 1342 . “[T]he alter-ego test for attribution of contacts, i.e. personal jurisdiction, is less stringent than that for liability.”

Stuart v. Spademan,

772 F.2d 1185 , 1198 n. 12 (5th Cir.1985) (citing

Marine Midland Bank, N.A v. Miller,

664 F.2d 899, 904 (2d Cir.1981)).

Hickton analyzes each of the ten factors. He argues that ERAC-Missouri owned one-hundred percent of the stock of all operating subsidiaries, including ERACPittsburgh. The three-member boards of directors of the operating subsidiaries were comprised of three board members of ERAC-Missouri. Hickton asserts that ERAC-Pittsburgh’s board did not act as an independent board, but rather acted via written consents. Enterprise Rent-A-Car markets and promotes itself as a single, homogeneous brand, in which the operating subsidiaries are indistinguishable from the parent. The general Enterprise brand logo is used by ERAC-Pittsburgh, and ERAC-Pittsburgh often holds itself out to consumers as “Enterprise Rent-A-Car Company,” without identifying a region. ERAC-Pittsburgh utilizes the services of employees of ERAC-Missouri’s IT and HR departments. Other departments of ERAC-Missouri also provide services to subsidiaries. ERAC-Missouri offers a 401(k) plan, profit sharing plan, and prescription drug plan to all employees. Enterprise uses a uniform, highly-integrated system for renting vehicles. Management and supervisory personnel move from parent to subsidiary and vice versa. The service offered by the Enterprise brand is automobile rentals — that service is exclusively provided by the operating subsidiaries. Defendant parent would otherwise have to undertake the business of the operating subsidiaries, but for their existence. The operating subsidiaries receive guidance in the form of instructional operating procedures from defendant parent, and if an operating subsidiary wishes to deviate from the procedures, there is a protocol that must be followed.

Defendant parent counters that there is a high threshold for exercising personal jurisdiction over a parent corporation pursuant to the alter-ego theory. ERACMissouri argues that much of the evidence Hickton asserts pursuant to the relevant factors does not demonstrate an unusual degree of control over the operating subsidiaries. It contends that the evidence is common with standard parent-subsidiary relationships.

a. Persuasive Decisions

As already explained, the 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.’ ”

Action Mfg. Co. v. Simon Wreck

*320

ing Co.,

375 F.Supp.2d 411, 422 (E.D.Pa.2005) (quoting

Directory Dividends,

2003 WL 21961448 , at *3). Two decisions from district courts within the Third Circuit shed light on the appropriate alter-ego analysis given the economic realities of twenty-first century business:

In re Latex Gloves Products Liability Litigation,

2001 WL 964105 , at * 1, and

In re Chocolate Confectionary Antitrust Litigation,

641 F.Supp.2d 367 (M.D.Pa.2009)

(“Chocolate Confectionary II”).

In re Latex Gloves Products Liability Litigation

involved a corporation that developed and manufactured healthcare products. The parent created a subsidiary corporation that sold and marketed latex gloves, and that subsidiary corporation itself owned secondary subsidiaries that manufactured the gloves.

In re Latex Gloves Prods. Liab. Litig.,

2001 WL 964105 , at *1. The boards of the parent and all subsidiaries consisted of the same three individuals, who transacted business in writing as opposed to holding in-person meetings. The parent’s board on occasion would buy and sell assets for the subsidiary corporation that sold and marketed gloves. The parent and the subsidiary corporation shared a payroll department, and healthcare benefits for the parent’s employees were provided by the subsidiary corporation.

Id.

at *1 . Financial statements and annual shareholder reports were consolidated.

Id.

at *2 .

In applying the alter-ego test and analyzing the ten factors, the court held that the subsidiary corporation was an alter ego of the parent. The court found significant that not only did the parent have the ability to control the subsidiary corporation, but deposition testimony suggested that the parent exercised this control and the parent and subsidiary corporation functioned as a single company. They portrayed themselves as a single company to the public.

Id.

at *4 . The court acknowledged that supervision of finances and articulation of general policies is not enough to confer jurisdiction, but noted that the parent approved all financial expenditures of the subsidiary corporation.

Id.

at *4 n. 13. The structure of the subsidiaries was key. They operated vertically as “strategic business units.”

Id.

at *6 . There was “evidence that the strategic business units cut managerially across corporate lines from the parent through the subsidiaries.”

Id.

at *6 n. 18. For example, one of the subsidiary corporation’s employees was the managing director of a secondary subsidiary’s manufacturing plant, with the power to hire and fire plant employees.

Id.

at *6 .

In

Chocolate Confectionary II,

three defendants moved to dismiss for lack of personal jurisdiction. One defendant was the Canadian subsidiary of the global parent. The parent resided in the forum. The Canadian company transferred profits to the parent by dividends and capital repatriations.

Chocolate Confectionary II,

641 F.Supp.2d at 373-74 . The parent established accounting protocols, required that it approve the annual budgets and capital expenditures in excess of $500,000, and issued a “Recurring Reports Manual” which governed the format of financial reports subsidiaries were required to submit.

Id.

at 373-74, 386 . The parent issued a “Finance Manual” that articulated broad pricing principles applicable to the Canadian subsidiary’s transactions.

Id.

at 374-75 . Approximately 85% of the subsidiary’s products were exported out of Canada, with the majority being exported to the United States.

Id.

at 374 .

The court held that the Canadian subsidiary was not an alter ego of the parent. With respect to the accounting, finance, and sales protocols, the court emphasized that “[u]niformity in finance procedure is a

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practical necessity for global conglomerates to monitor corporate growth and maximize efficiency, and imposition of mandatory financial reporting does not divest subsidiaries of control over daily operating activities.”

Id.

at 386 . The court found noteworthy the language in the finance manual distributed to subsidiaries encouraging them to “var[y] ... the way in which corporate principles are applied in practice,” and to implement operating plans “at the local level.”

Id.

at 387 . The subsidiaries were “very autonomous,” and although “linked by global brands,” they “would actually operate and market [their] products at the local level.”

Id.

Also important was the assumption of responsibility for operations and administration by the subsidiary’s managers. These managers did not supervise employees of other subsidiaries or “manage activities beyond the auspices of their employing corporation.” Id.

Since the Canadian subsidiary and the parent were not alter egos, the court proceeded to analyze whether general jurisdiction existed over the subsidiary based upon its contacts with the forum. The court held that the Canadian subsidiary’s export activity to the forum was not sufficient, because the Canadian subsidiary merely entered into arms-length transactions to sell the goods to an independent subsidiary. The Canadian subsidiary had no control over the other subsidiary’s distribution activities, and the product transfers represented “passive dissociation from the [forum] market rather than jurisdictional engagement with it.” Id. at 388 . Neither the Canadian subsidiary’s ratification of licensing agreements entered into by subsidiaries located within the forum nor the purchase of raw materials from the forum, even at regular intervals, was sufficient to confer general jurisdiction. Id. at 389 . Eighty-five trips to the forum over a seven-year span by the Canadian subsidiary’s executives for purposes of attending board meetings, conferences, and training were insufficient. Id. at 390 .

A second defendant was a holding company and ultimate parent of a group comprised of fifty-two operating entities. Although two immediate subsidiaries held legal title to trademarks and patents, the parent was the beneficial owner and licensor of all intellectual property. In exchange for granting licenses to operating entities, the parent received royalty payments. Id. at 375 . Executives of the parent made frequent trips to the forum to participate in acquisition activity and joint ventures. The parent managed products, brand images, and operations through strategic business units that were “constructed around product lines rather than along geographic or corporate boundaries.” Id. at 376 . Examples of product lines were confectionary, frozen foods, and pet care products. One unit was specifically assigned responsibility for designing promotional campaigns, conducting market research, and developing strategies for product placement.

Id.

at 376-77 . There was evidence, however, that one of the two immediate subsidiaries controlled the strategic business units. The operating subsidiaries had discretion to reject programs recommended by the units, and the operating subsidiaries created separate strategic business units that did not necessarily overlap. For example, the subsidiary within the forum had a unit for beverages, for which there was no counterpart.

Id.

at 392-93 . The parent maintained a system used to aggregate “financial, marketing, sales, and supply data ..., and group entities use it for a multitude of corporate functions, from cataloguing financial data to analyzing supply chain efficiency.”

Id.

at 377 . The operating entities retained all responsibility for the manufacturing, sales, and marketing processes.

Id.

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The court held that the operating subsidiary within the forum was not the alter ego of the parent.

Id.

at 391-95 . The court noted that the “mere presence of contractual ties between two related corporations does not meld into them a single entity,” and “[t]hat some of those benefits pass from [the operating entity] to [the parent] in the form of royalties rather than dividends sheds little light on the control that [the parent] exercises over [the operating entity]’s operational affairs.”

Id.

at 392 n. 36. The parent’s executive officers did not “manage the day-to-day operations” of the subsidiary, and the operating subsidiary exercised “a significant degree of autonomy over its daily affairs,” maintained “its own production facilities, purchase[d] raw materials through contracts to which [the parent was] not a party, formulatefd] its own budget, and established] its own administrative policies.”

Id.

at 395 .

With respect to general jurisdiction, the court rejected the plaintiffs’ argument that the parent had continuous and systematic contacts with the forum based upon a licensing arrangement between one of the primary subsidiaries and a corporation located within the forum, royalties the parent received from operating subsidiaries within the executives to the forum, events the parent held within the forum to entice investors, or the parent’s engagement in merger transactions with forum corporations.

Id.

at 396-99 .

The third defendant, the ultimate parent corporation of a group, managed the affairs of subsidiaries through a matrix organizational structure. Part of this structure was a panel organized by the parent that had responsibility “for the day-to-day management of the operations and the implementation of strategy.”

Id.

at 378 . The panel was comprised of the heads of strategic business units, and these heads also served as chief executives of the operating subsidiaries. The executives of the subsidiaries were responsible for their own subsidiary’s manufacturing activities, and also were responsible for management of the group’s international operations through the panel. The parent’s chief executive officer was an employee of a subsidiary corporation located within the forum.

Id.

The matrix structure allowed the panel to transfer personnel from one subsidiary to another, and the transferred employee, while employed by the transferee subsidiary, retained benefits and seniority accrued from the transferor subsidiary.

Id.

at 379 .

The court held that the plaintiffs produced prima facie evidence that the subsidiary within the forum was the alter ego of the third defendant.

Id.

at 400-05 . Similar to the second defendant, the parent vertically managed the group through strategic business units aligned with product groups rather than corporate boundaries, but unlike the second defendant, oversight of each unit was the responsibility of an executive of one of the operating subsidiaries. For example, the chief executive officer of the forum’s operating subsidiary was also the head of a strategic business unit, and he was responsible for that unit’s products regardless whether his subsidiary produced them.

Id.

at 401 . The parent in essence “conscripted employees of their subsidiaries to discharge group-wide management functions across corporate boundaries.”

Id.

The parent’s establishment of the panel, which controlled the daily functions of the operating subsidiaries “to the exclusion of their respective boards of directors” or managers, was also critical.

Id.

at 402 .

b. Application of the Alter-Ego Factors

The sharing by the corporations of directors and the ownership by defendant

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parent of one-hundred percent of ERACPittsburgh’s stock do not implicate that defendant parent controlled the subsidiary to the extent necessary to find that ERAC-Pittsburgh is an alter ego of defendant parent. A degree of control naturally flows from these aspects of the parent-subsidiary relationship, but this incidental control does not rise to the level required to permit the exercise of jurisdiction over the parent.

See Volkswagenwerk Aktiengesellschaft v. Beech Aircraft Corp.,

751 F.2d 117, 120 (2d Cir.1984) (“officers of any corporation that owns the stock of another necessarily exercise a considerable degree of control over the subsidiary corporation and the discharge of that supervision alone is not enough to subject the parent to ... jurisdiction”). In

Chocolate Confectionary II,

the court stated that these kind of corporate arrangements

reflect a parent corporation’s control over certain aspects of its subsidiary’s business but fall short of that required for a finding of alter ego status.... As the controlling shareholder of [the subsidiary], [the parent] is entitled to ordain [the subsidiary]^ officers and directors, influence executive compensation, approve budgets, gather information about corporate performance, and receive distributions of subsidiary profits.

Chocolate Confectionary II,

641 F.Supp.2d at 386 . “A parent corporation is entitled to establish group-wide financial protocols, monitor the performance of its subsidiaries, and reap financial benefits from their profits.”

Id.

at 394 .

The recommendations and best practices suggested by defendant parent in this case do not rise to the level of control to establish an alter-ego relationship. In

Chocolate Confectionary II,

a division of the second defendant (a parent corporation) formulated “guidelines and best practices,” which it distributed to operating subsidiaries. The court stated that “[b]y definition, these instructional resources are not corporate mandates.”

Id.

at 393 .

The common marketing image and joint use of trademarked logos fail to render ERAC-Pittsburgh an alter ego of ERACMissouri. Enterprise Rent-A-Car is portrayed as a single brand to the public, but this evidence does not demonstrate the necessary control by defendant parent over the subsidiaries.

See Seiko Epson Corp. v. Print-Rite Holdings, Ltd.,

No. 01-500, 2002 WL 32513403 , at *15 (D.Or. Apr. 30, 2002) (“The Court, therefore, finds the Group’s public image offers some evidence of the parties’ true relationships .... The Group’s marketing image, however, is only probative insofar as it is proof of the actual relationship between the parties. This evidence alone is insufficient to justify disregarding the general rule of corporate distinctions .... ”).

The use of an integrated sales system and use of services from defendant parent’s IT and HR departments likewise are not sufficient. These characteristics of this parent-subsidiary relationship merely show the resources defendant parent provided to its operating subsidiaries, but they do not show a high-level of operational control over the operating subsidiaries. In

Chocolate Confectionary II,

the court held that the second defendant’s implementation of an IT system, named GLOBE, did not render the subsidiary the parent

Use of the GLOBE system to achieve these ends is of little jurisdictional moment. Implementation of IT systems such as GLOBE is a ubiquitous practice in the modern business landscape, where investors and managers require access to instantaneous data in order to analyze the vacillation of revenue and expense. Utilization of such systems does not establish alter ego jurisdiction, particular

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ly when a parent has implemented them to farther activities — such as data collection and subsidiary oversight — that are inconsequential to the court’s Rule 12(b)(2) analysis. The doctrine of general jurisdiction does not require a corporation to eschew technological advances to avoid being haled into court, and [the parent’s reliance on the GLOBE system does not represent jurisdictionally meaningful contact with the [forum].

Id.

at 394 .

With respect to whether defendant parent would have to perform the business functions of the operating subsidiaries if not for their existence, the court notes that in the case of holding companies, “ ‘the subsidiary is not performing a function that the parent would otherwise have had to perform itself (the holding company could simply hold another type of subsidiary). In such a case, imputing jurisdictional contacts would be improper.’ ”

Action Mfg.,

375 F.Supp.2d at 422 (quoting

Gallagher v. Mazda Motor of Am., Inc.,

781 F.Supp. 1079, 1085 (E.D.Pa.1992)).

The court finds that the operating subsidiary ERAC-Pittsburgh is not the alter ego of defendant parent. The evidence pointed to by Hickton fails to show defendant parent exercised “any control over the internal workings or day-to-day operations of its subsidiaries.”

Hoffman v. Tyco Int'l, Ltd.,

No. 06-2961, 2006 WL 3759709 , at *5 (E.D.Pa. Dec. 18, 2006). The evidence of record considered as a whole does not reveal an extraordinary level of control of defendant parent over ERAC-Pittsburgh, other than the kind of control associated with parent-subsidiary relationships.

The court recognizes that, in the aggregate, ERAC-Missouri may provide a higher number of services to its operating subsidiaries than the number of services provided by the parent entities in

Chocolate Confectionary II.

The court notes that this difference in part is a consequence of the nature of the respective industries. The car rental industry is a service industry, in which the fundamental business transactions are entered into between the subsidiary and the consumer. ERAC-Missouri provides services that aid these transactions. The defendants in

Chocolate Confectionary II

engaged in an industry involved with the production and sale of a good. In that particular industry, a complex network of wholesalers and distributors existed between the producers and consumers. In both

In re Latex Gloves Products Liability Litigation

and

Chocolate Confectionary II

there were numerous facts tying the parent to the subsidiary, such as common ownership and the provision of administrative services. A key fact in those cases that resulted in the finding of alter-ego jurisdiction was the failure to adhere to corporate boundaries.

In re Latex Gloves Prods. Liab. Litig.,

2001 WL 964105 , at *6;

Chocolate Confectionary II,

641 F.Supp.2d at 401 ;

see Volkswagenwerk Aktiengesellschaft,

751 F.2d at 120 (under New York’s long arm jurisdiction statute, “when the activities of the parent show a disregard for the separate corporate existence of the subsidiary,” personal jurisdiction may be asserted). This key factor was particularly evidenced in

Chocolate Confectionary II,

in which the court found alter-ego jurisdiction did not exist over the two defendants who operated within the established corporate structure, but found alter-ego jurisdiction existed over the defendant that failed to do so.

Chocolate Confectionary II,

641 F.Supp.2d at 386-87, 391-95, 400-05 .

In both

In re Latex Gloves Products Liability Litigation

and

Chocolate Confectionary II,

the failure to adhere to corporate boundaries was demonstrated by the

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exercise of managerial power over the operations and functions of one subsidiary or group of subsidiaries by employees of a separate but affiliated corporation.

In re Latex Gloves Prods. Liab. Litig.,

2001 WL 964105 , at *6;

Chocolate Confectionary II,

641 F.Supp.2d at 401 . In this case, there is no evidence of a failure to operate within the corporate structures established among the Enterprise Rent-A-Car companies. This court cannot exercise in personam jurisdiction over ERAC-Missouri in this case based upon the alter-ego theory.

3. Specific Jurisdiction

Specific jurisdiction involves the situation where the claim arises out of or is related to a defendant’s contacts with the forum state.

Jarzynka v. St. Thomas Univ. Sch. of Law,

323 F.Supp.2d 660, 663 (W.D.Pa.2004). In

O’Connor II,

the Court of Appeals for the Third Circuit explained there is a three-part analysis for determining whether specific jurisdiction exists: (1) the defendant must have purposefully directed its activities at the forum; (2) the litigation must arise out of or relate to at least one of those activities; and (3) if the prior two requirements are met, a court may consider whether the exercise of jurisdiction otherwise comports with fair play and substantial justice.

O’Connor II,

496 F.3d at 317 .

Hickton argues specific jurisdiction exists, for many of the same reasons that he argues in personam jurisdiction exists under general jurisdiction and the alter-ego theory. He argues ERAC-Missouri purposefully directed its activities to Pennsylvania, because of the control it exerted over ERAC-Pittsburgh. This control, Hickton argues, affected the employment decisions related to the compensation of the subsidiary’s managers. The litigation arises out of that decision. Hickton argues that the exercise of specific jurisdiction would be consistent with traditional notions of fair play and substantial justice, and that based upon ERAC-Missouri’s business connections with the Pennsylvania, it would not suffer unfair surprise by being sued in that forum.

Defendant parent argues in response that ERAC-Missouri has no contacts whatsoever with Pennsylvania, and, to the extent ERAC-Missouri has contacts, the contacts are irrelevant to Hickton’s claims. Defendant parent urges the court to conclude the claims arise totally out of Hick-ton’s employment with and compensation from ERAC-Pittsburgh.

Specific in personam jurisdiction would exist over ERAC-Missouri in this case, if ERAC-Missouri was the sole employer of branch managers and assistant branch managers. Although ERAC-Missouri is not the sole employer of Hickton, he argues that ERAC-Missouri is a joint employer. Several courts have held that the determination of specific jurisdiction over a defendant depends upon whether that defendant is a joint employer.

In

Wiltshire v. HK Management,

No. 3:04-CV-0090B, 2004 WL 2974082 , at *3 (N.D.Tex. Dec. 16, 2004), the plaintiff was a crew member of the band Aerosmith, and she alleged she was sexually harassed in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e

et seq.

(“Title VII”). She sued several management companies who handled different aspects of the band’s tours. HK Management moved to dismiss for lack subject-matter jurisdiction, arguing it was not the plaintiffs employer. HK Management also moved to dismiss for lack of personal jurisdiction, arguing it did not have minimum contacts with the forum state, Texas.

Id.

at *1. The court held it had subject-matter jurisdiction over the plaintiffs claims, since the plaintiff alleged HK Management controlled her employment and was thus a joint employer.

Id.

The court

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held that HK Management’s occasional scheduling of concerts in Texas did not create continuous and systematic contacts to establish general jurisdiction.

Id.

at *2. With respect to specific jurisdiction, the court observed:

[The plaintiff’s argument in support of specific jurisdiction is that she was employed by HK Management, who scheduled concerts in Texas, at which time she was sexually harassed. HK Management does not deny scheduling concerts in Texas, so the issue of specific jurisdiction turns on whether or not HK Management was [the plaintiff’s employer ....

This issue is further complicated by the fact that no discovery had been conducted at the time [the plaintiff was required to,file a response to HK Management’s Motion to Dismiss, and judging from other documents filed with the Court, HK Management has refused to engage in any discovery to date.... This Court, on such a limited record, cannot make the fact intensive determination of whether HK Management was a joint employer of [the plaintiff. Taking all inferences in favor of [the plaintiff, the Court finds that [the plaintiff has presented prima facie evidence of an employment relationship, which would lead to specific jurisdiction in Texas.

Id.

at **2-3.

Bishop v. Consolidated Natural Gas, Inc.,

No. 99-1363, 2000 WL 6263 ,, at *3 (E.D.La. Jan. 5, 2000), involved issues similar to those raised in

Willshire.

The court stated “specific jurisdiction would be triggered if [the moving defendant] were a joint employer and played an integral role in denying [the plaintiff the promotional opportunity at issue in this employment discrimination lawsuit.”

Id.

Although the courts in those decisions held that specific jurisdiction turns' on whether the defendant is a joint employer, other courts have held that the joint employer analysis is irrelevant to personal jurisdiction.

In

Central States, Southeast & Southwest Areas Pension Fund v. Reimer Express World Corp.,

230 F.3d 934 (7th Cir.2000), a trucking company contributed on behalf of its employees to a multiemployer pension plan (the “fund”) pursuant to a collective bargaining agreement. The trucking company went out of business. Under the Multiemployer Pension Plan Amendments Act of 1980 to ERISA, 29 U.S.C. § 1383 (“MPPAA” or the “act”), this situation constituted a withdrawal, and the trucking company incurred withdrawal liability under the act.

Id.

at 937-38 .

The MPPAA provides that all businesses under common control are jointly and severally liable for the withdrawal of an affiliate. The fund sued the trucking company and a holding company that owned all stock of the trucking company in federal district court in Illinois. The holding company, which was a Canadian corporation, moved to dismiss for lack of personal jurisdiction.

Id.

at 938 .

The fund asserted that the district court could exercise specific personal jurisdiction over the holding company. The fund recognized that the general rule was that corporate ownership by itself is not enough to establish personal jurisdiction, but it argued that the principle did not apply in the context of withdrawal liability under the MPPAA since the act provides that “all businesses under common control shall be treated as a single entity.”

Id.

at 943 . The Court of Appeals for the Seventh Circuit rejected this argument. It stated:

The fund’s argument that this analysis changes where a federal statute premises liability on corporate affiliation ignores the process by which courts de

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termine whether specific personal jurisdiction exists and confuses liability and jurisdiction. To decide whether specific personal jurisdiction may be exercised, a court must engage in three distinct steps in the following order: (1) identify the contacts the defendant has with the forum; (2) analyze whether these contacts meet constitutional mínimums and whether exercising jxirisdiction on the basis of these minimum contacts sufficiently comports with fairness and justice; (3) determine whether the sufficient minimum contacts, if any, arise out of or are related to the causes of action involved in the suit. If the court determines at the second step that a defendant does not have sufficient minimum contacts with the forum, then its personal jurisdiction analysis ends without examining the plaintiffs causes of action. The laws on which the suit are based would be irrelevant because a state or federal statute cannot transmogrify insufficient minimum contacts into a basis for personal jurisdiction by making these contacts elements of a cause of action, since this would violate due process. The fact that a defendant would be liable under a statute if personal jurisdiction over it could be obtained is irrelevant to the question of whether such jurisdiction can be exercised. MPPAA's definition of corporate affiliation as an element of withdrawal liability cannot confer personal jurisdiction on the basis of such affiliation---- Thus, MPPAA’s control group provision regarding withdrawal liability does not alter the rule that corporate affiliation or ownership is not a sufficient minimum contact for the exercise of personal jurisdiction.

Id.

at 944-45 .

In

Vogt v. Greenmarine Holding, LLC, No.

1:01-CV0311JOF, 2002 WL 534542 , at *1 (N.D.Ga.2002), former employees of a manufacturer of marine engines sued for violations of the Worker Adjustment and Retraining Notification Act (“WARN”), 29 U.S.C. §§ 2101-09 , which requires that employers provide sixty days’ advance written notice of a plant closing or mass layoff. The plaintiffs sued the manufacturer and several holding companies that owned the manufacturer.

Id.

at *1 . Several of the holding companies moved to dismiss for lack of personal jurisdiction. In response, the plaintiffs argued that jurisdiction depended on whether the holding companies were joint employers, but the court disagreed.

Plaintiffs argue that the proper test for personal jurisdiction is whether [the manufacturer] and [the holding companies] constitute a “single employer” so as to be liable under WARN. The court finds, however, that it is improper to conflate an issue of subject matter jurisdiction with personal jurisdiction. Liability and jurisdiction are two separate inquiries.

Id.

at *3 . The court cited the

Central States’

holding that the analysis of personal jurisdiction is not altered where a federal statute premises liability on corporate affiliation.

Id.

One other decision indirectly touching on the subject is

United Electrical, Radio & Machine Workers v. 163 Pleasant St. Corp.,

960 F.2d 1080 , 1096 (1st Cir.1992). The Court of Appeals for the First Circuit stated in dicta:

In a final, apopemptic effort to salvage their victory below, plaintiffs contend that ... jurisdiction over [the defendant] was nonetheless exercisable under an “integrated enterprise” theory. Whatever the cogency of this asseveration — and we are highly skeptical of its merits in light of the conspicuous lack of support in the case law for transplanting

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this theory from the liability context to the jurisdictional context — the plaintiffs have forfeited the opportunity to seek appellate review of this contention.

Id.

at 1096.

The court is persuaded by the latter group of decisions in which the courts recognized that the joint employer theory and similar concepts are relevant for determining liability, but are not for determining whether a court may exercise personal jurisdictional over a party. Since the joint employer issue is not relevant to the specific jurisdiction analysis, the court will analyze defendant parent’s contacts under the three-part analysis used by the Court of Appeals for the Third Circuit in

O’Connor

II.

17

During oral argument, Hickton’s counsel argued Adams testified at his deposition that defendant parent’s recommendations were universally implemented, implying that the so-called recommendations were mandatory orders, which are purposefully-directed activities toward Pennsylvania from which this lawsuit arises. Defendant parent countered that Nettles unequivocally testified at his deposition that he made the relevant employment decisions, and was not unduly influenced by defendant parent.

The court finds that the issue with respect to specific jurisdiction issue is a close question. In

Langlois v. Deja Vu, Inc.,

984 F.Supp. 1327, 1342 (W.D.Wash.1997), the court was presented with a situation similar to that presented in this case. One out-of-state entity provided consulting services on employment matters to related entities, and one of the in-state related entities allegedly employed the plaintiffs. Those services were communicated via “flash” memoranda.

Id.

at 1341 . The plaintiffs brought FLSA actions. In

Langlois ,

there was deposition testimony that some of the affiliated entities, including one in the forum, did not receive the memoranda. There was also testimony that the affiliated entities had discretion to reject following the memoranda.

Id.

at 1342 . The court explained that if

the flash memoranda provided by [the one entity] were only for informational purposes, then [the one entity’s] contacts would appear to be fortuitous, and not purposeful. If a contract standing alone is insufficient to indicate a purposeful contact

(see Burger

King), then surely a contact which is at most advisory in nature cannot amount to a purposeful contact.

Id.

The court, however, found that the plaintiffs presented prima facie evidence that specific jurisdiction existed:

Despite [the one entity’s] arguments, it appears, on the whole, that a genuine issue exists regarding whether [the affiliated entities] were contractually required to utilize the information provided by [the one entity]. One could reasonably infer that [the affiliated entities] were required to follow the memoranda from the fact that consulting agreements were in place with [the affiliated entities], [the one entity] received fees from the agreements based on [its] work performed, and the ... leases were adopted by [the affiliated entities] and revised. Most importantly and regardless of whether [the affiliated entities] were actually required to use the information, Plaintiffs have presented a prima facie case in sup

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port of an inference that [the one entity] could reasonably foresee — based on its consulting agreements with [the affiliated entities] and the employment advice it gave pursuant to those agreements — that it might be subject to having to defend a lawsuit in Washington based on those contacts.

Id.

The court denied the motion to dismiss for lack of personal jurisdiction.

Id.

at 1331-32 .

If ERAC-Missouri’s recommendations were purely informational, then ERACMissouri could not be found to have purposefully availed itself of the protections and benefits of Pennsylvania law. Under those circumstances, the court could not conclude that there was evidence sufficient to satisfy the first part of the analysis set forth in

O’Connor II.

On the other hand, if the rationale of

Langlois

is followed, there is a genuine issue of fact and, since no evidentiary hearing was held, the court would need to find plaintiffs presented a prima facie case supporting specific jurisdiction. The facts of this case present complex issues which may need an evidentiary hearing to resolve whether personal jurisdiction in fact exists over ERAC-Missouri. To streamline the decision making, courts, in situations where complex issues of personal jurisdiction exist and there is a pending motion which would be dispositive in favor of the party over whom jurisdiction is disputed, may defer ruling on the motion to dismiss and proceed to resolve the dispositive motion. “[W]hen the jurisdictional question is complex or difficult, a court simply may avoid the issue by resolving the suit on the merits when they clearly must be decided in favor of the party challenging jurisdiction, thereby obviating any need to decide the question .... ” 4 Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1067.6 at 553 (3d ed.2002);

see Lee v. City of Beaumont,

12 F.3d 933, 937 (9th Cir.1993),

overruled on other grounds by California Dept. of Water Resources v. Powerex Corp.,

533 F.3d 1087, 1091 (9th Cir.2008). This court will follow that approach because the motion for summary judgment, which has been fully briefed, will be granted in favor of ERAC-Missouri. Under those circumstances, the motion to dismiss for lack of personal jurisdiction will be denied without prejudice.

D. Motion to Dismiss With Respect to Averill

1. General Jurisdiction

Averill argues ERAC-Missouri engages in calculated activities in and directed toward Illinois.

a. Prior Lawsuit in the Forum— Judicial Estoppel

Averill argues ERAC-Missouri’s prior conduct contradicts its own argument with respect to in personam jurisdiction. Ave-rill argues ERAC-Missouri initiated a lawsuit in August 2004 in the Northern District of Illinois against Collision Industry Management Solutions, claiming trademark infringement based upon the use of the “ARMS” trade name. In the complaint, defendant parent openly stated it was conducting business and operating locations in Illinois. Defendant parent has registered trademarks and service marks with the Illinois Secretary of State since 1957; the registration for one of the marks is set to expire in 2012.

Defendant parent argues that the complaint filed in the Northern District of Illinois was unartfully drafted, and should have stated that authorized

users

of the trademark conduct business in Illinois. Defendant parent argues registration or enforcement of a trademark is not significant to the analysis of minimum contacts. It also argues the common trade name and

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branding strategy is incidental to the parent-subsidiary relationship.

Defendant parent is not judicially estopped from challenging an Illinois court’s jurisdiction over it, even though it stated in the prior lawsuit that it “operates a large number of locations in the Northern District of Illinois.” (PL’s Br. Averill, Ex. 1 at P0002.) Judicial estoppel precludes a party from asserting a position inconsistent with positions previously asserted, if the inconsistency is intentional and is “ ‘used as a means of obtaining unfair advantage.’ ”

Ryan Operations G.P. v. Santiam-Midwest Lumber Co.,

81 F.3d 355, 362 (3d Cir.1996) (quoting

Scarano v. Central R. Co. of N.J.,

203 F.2d 510, 513 (3d Cir.1953)). There are three elements necessary

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