Beyer v. Camex Equipment Sales & Rentals, Inc.
Filing
56
ORDER granting 3 Defendants Motion to Quash and to Dismiss for a Lack of Personal Jurisdiction. The complaint and this action are hereby DISMISSED without prejudice. by Judge William J. Martinez on 7/8/2011.(erv, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Judge William J. Martínez
Civil Action No. 10-cv-01580-WJM-MJW
MARK A. BEYER,
Plaintiff,
v.
CAMEX EQUIPMENT SALES & RENTALS, INC.,
Defendant.
ORDER GRANTING DEFENDANT’S MOTION TO DISMISS FOR
LACK OF PERSONAL JURISDICTION
THIS MATTER is before the Court on Defendant Camex Equipment Sales &
Rentals, Inc.’s (“Camex”) Motion to Quash Service of Process and to Dismiss for Lack
of Personal Jurisdiction (“Motion”). (ECF No. 3.) For the reasons set forth below, this
Motion is GRANTED.
INTRODUCTION
This is a personal injury case whereby Plaintiff Mark Beyer (“Beyer”) received
injuries after falling underneath a moving bed truck manufactured and sold by Camex to
Beyer’s employer for drilling rig moves. Beyer asserts three claims for relief: (1) strict
product liability; (2) manufacturer’s liability based on negligence; and (3) negligence.
Camex moves to dismiss the action based on a lack of personal jurisdiction. The
parties have fully briefed the Motion and it is now ripe for disposition.
BACKGROUND
Camex is a Canadian corporation with its principal place of business in Nisku,
Alberta, Canada. (Case Aff., ECF No. 3-1 at ¶ 2.) Camex has two facilities, both
located in Nisku. (Id.) Camex provides equipment to the oilfield industry through the
sale and lease of new, used, and consigned equipment. (Compl., ECF No. 1-1 at ¶ 56.)
On April 24, 2007, Camex sold a 2007 Kenworth 400" bed truck to Xtreme
Oilfield Trucking, Inc. (“Xtreme”) for $442,000. (Bill of Sale, ECF No. 3-2.) The bed
truck was initially manufactured by Kenworth, then modified by Camex for use in an
oilfield. (ECF No. 1-1 at ¶ 7.) According to Beyer, Camex advertises its bed trucks as
setting the standard for performance, comfort, and reliability in the oilfield market. (Id.)
Beyer further alleges that Camex specializes in rigging beds to Kenworth trucks for the
highest quality product and craftsmanship. (Id.)
Xtreme is a Wyoming corporation with its principal place of business in
Cheyenne, Wyoming. (ECF No. 1-1 at ¶ 8.) Xtreme’s business consists of heavy haul
transfers of oil field drilling equipment, oil rigs, tubing and pumps related to the oil field
industry. (Colo. Admin. Order, ECF No. 12-1 at 3 ¶ 2.) At the time Xtreme purchased
the bed truck, it had two oil drilling rigs in Colorado, two in Wyoming, and two in
Canada. (ECF No. 12 at 3.) Xtreme also sought opportunities to complete rig moves
for other oil field companies. (ECF No. 12-1 at 2 ¶ 4.) Beyer alleges that the bed truck
was purchased with the intent that it would assist in moving drilling rigs both within and
outside the State of Wyoming. (ECF No. 12 at 7.)
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Beyer, a Wyoming resident, began working for Xtreme in May 2007. (ECF Nos.
12 at 2; 12-1 at 2 ¶ 1.) Beyer was hired as a “swamper,” which entailed assisting the
driver of the truck during rig moves. (ECF No. 1-1 at ¶ 8.) Beyer’s tasks included
mounting and/or loading parts of a disassembled drilling rig onto the bed of a truck for
transfer to a new location. (ECF No. 1-1 at ¶ 11.) Beyer would then unload the parts at
the new location and return to the original location for more equipment until the transfer
was complete. (Id.) Beyer was to assist in moving rigs in Wyoming, Colorado, and
possible other locations. (ECF No. 12 at 2.) During the first 10 days of his employment
with Xtreme, Beyer assisted in moving a rig from Rifle, Colorado, to Casper, Wyoming,
and moving a rig outside Platteville, Colorado. (ECF No. 12-1 at ¶ 5.)
On June 2, 2007, while Beyer was at work moving the drilling rig near Platteville,
in Weld County, he unsuccessfully attempted to mount the bed truck during transport.
(ECF No. 1-1 at ¶ 3.) Beyer had not sat inside the passenger compartment during the
rig move that day. (Id. at 11.) Beyer alleges that in the pressure of the rig move, the
truck driver was impatient to start and therefore began driving away before Beyer could
secure a position on the bed truck. (Id. at ¶ 12.) Beyer fell underneath the bed truck
and suffered severe injuries primarily to his left leg, hip, and spinal column. (ECF No.
12 at 2.) Beyer was airlifted to North Colorado Medical Center for surgery and
treatment. (ECF No. 12-1 at ¶ 6.) He then was moved to Wyoming for further care.
(ECF No. 12 at 2.)
Beyer commenced this lawsuit against Camex on June 2, 2010 in the District
Court for Weld County, State of Colorado. (ECF No. 1-1.) Camex removed the matter
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to this Court on July 2, 2010. (Notice of Removal, ECF No. 1 at 4.) On July 2, 2010,
Camex further filed a Motion to Quash Service of Process and to Dismiss for Lack of
Personal Jurisdiction. (ECF No. 3.) On September 10, 2010, Camex waived service of
process, leaving only the matter of personal jurisdiction for the Court to address. (ECF
No. 13 at 1.) Notably, Beyer failed to conduct any discovery on issues raised in
Camex’s Motion. (Unofficial Tr. at 14:07:52-14:08:08.) Discovery closed on June 13,
2011. (ECF No. 51.) The Court heard oral argument on the Motion on June 30, 2011
and took the matter under advisement. (ECF No. 53.) At oral argument, counsel for
Plaintiff was unable to explain or provide any reason why Beyer did not file this matter in
Wyoming. (Unofficial Tr. at 14:28:32-14:29:18.)
STANDARD OF REVIEW
Rule 12(b)(2) of the Federal Rules of Civil Procedure provides that a defendant
may move to dismiss a complaint for “lack of personal jurisdiction.” The plaintiff bears
the burden of establishing personal jurisdiction over the defendant. OMI Holdings v.
Royal Ins. Co. of Can., 149 F.3d 1086, 1091 (10th Cir. 1998). If the presence or
absence of personal jurisdiction can be established by reference to the complaint, the
Court need not look further. The Court will accept the well-pled allegations of the
complaint as true to determine whether the plaintiff has made a prima facie showing that
personal jurisdiction exists. Dudnikov v. Chalk & Vermillion Fine Arts, Inc., 514 F.3d
1063, 1070 (10th Cir. 2008). Any factual conflicts must be resolved in the plaintiff’s
favor. Wentz v. Memery Crystal, 55 F.3d 1503, 1505 (10th Cir. 1995). To defeat the
plaintiff’s prima facie case, a defendant “must present a compelling case demonstrating
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‘that the presence of some other considerations would render jurisdiction
unreasonable.’” OMI Holdings, 149 F.3d at 1091 (quoting Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 477 (1985)).
DISCUSSION
To determine whether a court has personal jurisdiction in a diversity case such
as this one, a plaintiff must show (1) that jurisdiction is proper under the forum state’s
long-arm statute; and (2) that exercise of personal jurisdiction over the defendant
comports with due process. See Equifax Servs., Inc. v. Hitz, 905 F.2d 1355, 1357 (10th
Cir. 1990). To comport with due process, the defendant foreign corporation must have
minimum contacts with the forum state such that maintenance of the lawsuit would not
offend “traditional notions of fair play and substantial justice.” Int’l Shoe Co. v.
Washington, 326 U.S. 310, 316 (1945).
In Colorado, the state’s long arm statute “confers the maximum jurisdiction
permissible consistent with the Due Process Clause.” Dudnikov, 514 F.3d at 1070
(quoting Archangel Diamond Corp. v. Lukoil, 123 P.3d 1187, 1193 (Colo. 2005)). Thus,
the Court need only address the constitutional question of whether the exercise of
personal jurisdiction over Camex comports with due process.
To determine whether personal jurisdiction is proper under the Constitution, a
court first looks to find minimum contacts within the forum state. See Int’l Shoe Co., 326
U.S. at 316. The focus is on protecting the liberty interest in not being subject to “the
binding judgments of a forum with which [the defendant] has established no meaningful
contacts, ties, or relations.” Burger King, 471 U.S. at 472 (quotations and citation
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omitted). If minimum contacts are established, the court then determines whether
exercise of personal jurisdiction would be reasonable. Int’l Shoe Co., 326 U.S. at 316.
The standard of reasonableness is measured by whether an exercise of jurisdiction
would offend “traditional notions of fair play and substantial justice.” Id.
“[T]he question of whether a non-resident defendant has the requisite minimum
contacts with the forum state to establish in personam jurisdiction must be decided on
the particular facts of each case.” Benton v. Cameco Corp., 375 F.3d 1070, 1076 (10th
Cir. 2004) (internal quotation marks omitted). “[T]he individual nature of the [personal
jurisdiction] determination makes it extremely difficult to compare precisely the unique
circumstances and outcomes of different cases.” Keefe v. Kirschenbaum &
Kirschenbaum, P.C., 40 P.3d 1267, 1273 (Colo. 2002).
The minimum contacts analysis differs depending on whether it arises from
specific or general jurisdiction. OMI Holdings, 149 F.3d at 1090-91. A court may assert
specific jurisdiction “if the defendant has ‘purposefully directed’ his activities at residents
of the forum, and the litigation results from alleged injuries that ‘arise out of or relate to’
those activities.” Burger King, 471 U.S. at 472 (internal citations and quotations
omitted). General jurisdiction, on the other hand, “arises when a defendant maintains
continuous and systematic contacts with the forum state even when the cause of action
has no relation to those contacts.” Helicopteros Nacionales de Colombia, S.A. v. Hall,
466 U.S. 408, 416 (1984).
Here, Camex asserts that it is not subject to this Court’s jurisdiction because: (1)
the sale of the bed truck involved in the incident occurred in Wyoming and therefore
Beyer’s claims against Camex do not arise from Camex’s contacts with Colorado such
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that the Court could assert specific jurisdiction; (2) Camex did not avail itself of the
privileges of conducting business in Colorado; and (3) Camex does not have
“continuous and systematic contacts” with Colorado such that the Court could assert
general personal jurisdiction. (ECF No. 3 at ¶¶ 15, 16.) Beyer argues that the Court
can assert either specific or general jurisdiction over Camex based on the reasonable
foreseeability that the bed truck would be used in Colorado and Camex’s business
contacts in Colorado. (ECF No. 12 at 5-6.) The Court therefore addresses Camex’s
contacts with Colorado under the specific and general jurisdiction prongs.
A.
Specific Jurisdiction
A court may exercise specific jurisdiction when the defendant has purposefully
directed its activities to the forum state and where the underlying alleged injury arises
out of or relates to the defendant’s activities in the forum state. Found. for Knowledge in
Dev. v. Interactive Design, 234 P.3d 673, 678 (Colo. 2010) (quoting Burger King, 471
U.S. at 472). This is a two prong analysis, where the Court must determine (1) “whether
the defendant purposefully availed himself of the privilege of conducting business in the
forum state;” and (2) “whether the litigation ‘arises out of’ the defendant’s forum-related
contacts.” Id. (quoting Archangel, 123 P.3d at 1194). Within this analysis, the Court
considers the “quantity and quality” of Defendant’s contacts in Colorado. OMI Holdings,
149 F.3d at 1092 (emphasis in original).
The specific jurisdiction analysis requires that a defendant should have minimum
contacts with the forum state in order to “reasonably anticipate being haled into court
there.” World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980). Further,
it must be “actions by the defendant himself that create a ‘substantial connection’ with
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the forum state.” Asahi Metal Indus. Co., Ltd. v. Superior Court of Cal., 480 U.S. 102,
109 (1987) (emphasis in original) (citation omitted). A defendant should not be“subject
to the laws of a jurisdiction solely as a result of random, fortuitous, or attenuated
contacts, or the unilateral activity of another party or a third person.” AST Sports Sci.,
Inc. v. CLF Distrib., Ltd., 514 F.3d 1054, 1058 (10th Cir. 2008). “[C]onduct of the
defendant may indicate an intent or purpose to serve the market in the forum State, for
example, designing the product for the market in the forum State, [and] advertising in
the forum State . . . .” Id. at 112. “ ‘[F]oreseeability’ alone has never been a sufficient
benchmark for personal jurisdiction under the Due Process Clause.” World-Wide
Volkswagen, 444 U.S. at 296.
The Due Process Clause “gives 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. Id. at
297. Thus, a defendant must have affirmatively placed a product into a market for
personal jurisdiction to comport with due process. See Asahi, 480 U.S. at 112-113
(held no purposeful availment where defendant sold valves that were used in tire tubes
in California but where defendant did no business in California, had no office, and did
not otherwise solicit business in California); World-Wide Volkswagen, 444 U.S. at 295298 (held no purposeful availment where plaintiff purchased automobile in New York but
was injured in Oklahoma, reasoning that although an automobile is mobile, knowledge
that it may travel to another state is not enough without an affirmative action of the
defendant to get it to the other state); Bell Helicopter Textron, Inc. v. Heliquest Int’l, Ltd.,
385 F.3d 1291, 1298 (10th Cir. 2004) (held no purposeful availment where helicopter
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was leased in Canada from New Mexico defendant and injury occurred in Utah,
reasoning that the mere possibility that helicopter could be taken to Utah is too remote);
Benton, 375 F.3d at 1076-77 (finding purposeful availment where defendant entered
into a contract with a Colorado resident, sent employees to Colorado to conduct due
diligence, sent significant correspondence to plaintiff in Colorado, and committed a
tortious act in Colorado); Premier Corp. v. Newsom, 620 F.2d 219, 222 (10th Cir. 1980)
(held no purposeful availment where plaintiff and defendants were not residents of
Colorado and relevant contracts regarding purchase and sale of cattle formed outside of
Colorado but injury occurred in Colorado, reasoning because plaintiff took cattle to
Colorado without knowledge or direction of defendants, such conduct did not create
sufficient minimum contacts); Watson v. Dillon Companies, Inc., 615 F. Supp. 2d 1221,
1226 (D. Colo. 2009) (finding purposeful availment where defendant sold product to a
distributor with the awareness that the distributor was marketing its final product in the
forum state).
With respect to the purposeful availment prong, Beyer argues that because
Xtreme had oil drilling rigs in Wyoming, Colorado, and Canada at the time it purchased
the bed truck from Camex, and because the bed truck was built for the specific purpose
of moving drilling rigs, Camex should have foreseen that the bed truck would be used in
Colorado. (ECF No. 12 at 7.) The Court notes that at the time of purchase, Xtreme was
also soliciting bids to move oil drilling rigs for other companies. (ECF No. 12-1 at 3 ¶ 4.)
Although Camex sold the bed truck to Xtreme for the purpose of moving drilling rigs, it
did not know nor could it definitively foresee that Xtreme would use the truck anywhere
other than in Wyoming, where it was delivered. (ECF No. 3-1 at ¶ 3.) Even if Camex
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were to have foreseen that the bed truck could be used in Colorado, the truck could also
have stayed in Wyoming, gone to Canada, or to any other state where Xtreme
contracted in the future to move a drilling rig. Foreseeability, alone, is not enough to
justify the Court asserting personal jurisdiction over Camex. See World-Wide
Volkswagen, 444 U.S. at 295.
Here, similar to Bell Helicopter and Premier, it was the action of an unrelated
third party – Xtreme – and not Defendant Camex, that caused the bed truck to be
located in Colorado. Bell Helicopter, 385 F.3d at 1298 (plaintiff took helicopter from
Canada to Utah); Premier, 620 F.2d 222 (plaintiff took cattle to Colorado). This
unilateral activity of Xtreme does not satisfy the requirement that Camex have sufficient
minimum contacts with Colorado so as to comport with due process. See Premier, 620
F.2d at 223 (quoting Hanson v. Denckla, 357 U.S. 235, 253 (1958)).
The Court further looks at Camex’s other contacts in Colorado. Camex has sold
oilfield equipment to 10 customers in Colorado between 2007 and 2010. (ECF No. 3-1
at ¶ 6.) However, Camex’s sales in Colorado were the result of those customers taking
the initiative to solicit Camex, and not the other way around. (Id.) Camex does not
have a presence in Colorado, and does not solicit customers through direct marketing in
Colorado. (Id. at ¶¶ 5-6.) Further, Camex employees have not traveled to Colorado to
solicit business or attend marketing events or trade shows. (Id. at ¶ 6.) Only 2 percent
of Camex’s global sales came from Colorado during the relevant 2007-2010 time frame.
(Id.)
As the Supreme Court held in World-Wide Volkswagen, “if the sale of a product
of a manufacturer . . .arises from the efforts of the manufacturer . . . to serve directly or
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indirectly, the market for its product in other States, it is not unreasonable to subject it to
suit in one of those States if its allegedly defective merchandise has there been the
source of injury to its owner or to others.” 444 U.S. at 297. Camex is in the business of
providing equipment to the oil field industry, and Beyer’s injuries resulted on an oil field
in Colorado. (ECF No. 1-1 at ¶¶ 3, 6.) However, there is a market for oil field
equipment anywhere there is drilling for oil. This market is not limited to Colorado and
Wyoming. Were this Court to assert personal jurisdiction on Camex because of
Xtreme’s conduct in moving the bed truck to Colorado, there would conceivably be no
limit on any court asserting personal jurisdiction over Camex wherever its products
ultimately came to be located. See World-Wide Volkswagen, 444 U.S. at 296 (“Every
seller of chattels would in effect appoint the chattel his agent for service of process. His
amenability to suit would travel with the chattel.”)
The Court finds that the evidence of record does not show that Camex had
sufficient minimum contacts with Colorado such that Camex would reasonably
anticipate that it would be haled into court for an injury arising out of the sale of the bed
truck in Wyoming.
Because the Court finds that Camex did not purposefully directs its activities at
Colorado, it need not address whether the injury arose out of Camex’s contacts with
Colorado. See Kuenzle v. HTM Sport-Und Freizeitgerate AG, 102 F.3d 453, 456 (10th
Cir. 1996); Ajjarapu v. AE Biofuels, Inc., 728 F. Supp. 2d 1154, 1162 (D. Colo. 2010).
The Court therefore holds that exercising specific jurisdiction over Camex would be
improper under the facts of this case.
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B.
General Jurisdiction
As Beyer contends, a court may also exercise general jurisdiction over a putative
defendant when that entity’s business contacts with the forum state are “continuous and
systematic.” Helicopteros, 466 U.S. at 414-16. “Because general jurisdiction is not
related to the events giving rise to the suit, courts impose a more stringent minimum
contacts test, requiring the plaintiff to demonstrate the defendant’s continuous and
systematic general business contacts.” OMI Holdings, 149 F.3d at 1091 (citation
omitted); see also Helicopteros, 466 U.S. at 418 (holding $4 million worth of purchases
over 7 years does not rise to a finding of personal jurisdiction); Benton, 375 F.3d at
1081 (holding two dozen transactions over 8 years does not rise to a finding of personal
jurisdiction); Electronic Solutions, Inc. v. MechoShade Systems, Inc., 2011 WL 1756222
*5 (D. Colo. May 9, 2011) (unpublished) (holding 1.5 percent of annual revenue over
two years and distributing product through 5 distributors, without more, does not rise to
a finding of personal jurisdiction).
As noted earlier, Beyer argues that between 2007 and 2010, Camex (1) has had
10 customers in Colorado; (2) has sold approximately $3.5 million worth of equipment in
Colorado; and (3) has actively marketed products to its existing Colorado customers.
(ECF No. 12 at 10-11.) Beyer therefore asserts that Camex has “continuous and
systematic” contacts with Colorado such that asserting general jurisdiction comports
with due process. (ECF No. 12 at 11.) However, Camex’s Colorado customers took
the initiative in making the first contact with Camex after finding Camex on the internet
or through alternate means. (see Unofficial Tr. at 14:10:22-14:11:36.) Camex did not
solicit Colorado customers through direct marketing. (ECF No. 3-1 at ¶ 6.)
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Camex asserts that it (1) does not maintain offices or agents in Colorado; (2)
does not maintain a phone listing or bank account in Colorado;(3) does not own real or
personal property in Colorado; (4) Camex employees have never traveled to Colorado
to solicit business or attend a trade show; and (5) sales in Colorado account for a
minimal percentage of total global sales. (Id. at ¶¶ 5-6.) Therefore, Camex asserts that
it should not be subject to personal jurisdiction in this Court on the basis of general
jurisdiction. (ECF No. 3 at ¶ 16.)
The Court finds that the evidence of record in this case does not establish that
Camex had such continuous and systematic business contacts with Colorado so as to
allow this Court to assert personal jurisdiction over Camex on the basis of general
jurisdiction. Camex does not have any official presence in Colorado. (ECF No. 3-1 at ¶
5.) Further, between 2007 and 2010, Camex has only sold 2 percent of its total global
sales to Colorado customers. (ECF No. 3-1 at ¶ 6.) Camex does not solicit new
customers in Colorado; instead, its 10 current customers sought out Camex’s services
through the internet. (ECF No. 3-1 at ¶ 6; Unofficial Tr. at 14:10:22 - 14:11:36.) While
Camex does directly market its products to Colorado customers once they make a
purchase, marketing to just 10 customers in the state is insufficient for the Court to find
that Camex had continuous and systematic contacts with Colorado during the threeyear period at issue here. Given that Camex does not have the requisite continuous
and systematic contacts with Colorado, the Court concludes it may not exercise general
jurisdiction over Camex in this case.
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CONCLUSION
It is therefore ORDERED that Defendant’s Motion to Quash Service of Process
and to Dismiss for a Lack of Personal Jurisdiction, ECF No. 3, is hereby GRANTED.
The complaint and this action are hereby DISMISSED without prejudice.
Dated this 8th day of July, 2011.
BY THE COURT:
William J. Martínez
United States District Judge
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