Kemp v. ABC Insurance Company et al

Filing 39

ORDER AND REASONS: IT IS ORDERED that Defendant's 33 Motion to Dismiss for Lack of Jurisdiction is DENIED. Signed by Judge Ivan L.R. Lemelle on 5/24/2017. (ajn)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
KIARA KEMP

CIVIL ACTION

VERSUS

NO. 15-5739

ABC INSURANCE COMPANY, INC., ET AL.

SECTION “B”(5)

ORDER AND REASONS
I.

NATURE OF MOTION AND RELIEF SOUGHT
Before the court is Defendant Hyundai Steel Company’s “Motion

to Dismiss Based on Lack of Personal Jurisdiction” (Rec. Doc. 33),
“Plaintiff’s Memorandum in Opposition to Motion to Dismiss Based
on Lack of Personal

Jurisdiction”

(Rec. Doc. 34)

and

“Reply

Memorandum in Support of Motion to Dismiss Based on Lack of
Personal Jurisdiction” (Rec. Doc. 38).
IT IS ORDERED that the Defendant’s Motion is DENIED.
II.

FACTS AND PROCEDURAL HISTORY
Hyundai Steel, a South Korean corporation with its principal

place of business there, sells various steel products worldwide.
(Rec. Docs.

1 and 33-1). It contracted to sell steel reinforcing

bars (rebar) to Steelinvest Jersey Ltd, of London, England. (Rec.
Doc. 33-1). Hyundai Steel packaged the rebar at its plant and an
independent stevedoring company transported the goods to the port
of loading in Pohang, South Korea. (Rec. Doc. 33-1). SK Shipping
arranged for the goods to be stowed aboard its time chartered
vessel, the M/V UNITED TENORIO. (Rec. Doc. 33-1). SK Shipping

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selected the vessel’s route from Pohang to New Orleans, Louisiana,
where the rebar was to be discharged. (Rec. Doc. 33-1).
While the vessel was in New Orleans, Kiara Kemp boarded the
M/V UNITED TENORIO to inventory cargo and became permanently
injured when a large bundle of rebar sprung free from its casing.
(Rec. Doc. 1-1). Kemp filed suit in Civil District Court for the
Parish of Orleans. (Rec. Doc. 1-1). Defendants then removed the
action on the basis of diversity of citizenship under 28 U.S.C.
§1332. (Rec. Doc. 1). Following removal, Kemp filed an Amended
Complaint naming Hyundai Steel as an additional defendant. (Rec.
Doc. 15). Hyundai now moves to dismiss the claim for lack of
personal jurisdiction. (Rec. Doc. 33).
III. FACTUAL AND LEGAL FINDINGS
When resolving a Rule 12(b)(2) motion to dismiss for lack of
personal jurisdiction, a plaintiff must establish the court’s
jurisdiction over the defendant. Luv N'Care, Ltd. v. Insta-Mix,
Inc., 438 F.3d 465, 469 (5th Cir. 2006). The plaintiff need not,
however, establish jurisdiction by a preponderance of the evidence
and a prima facie showing suffices. Id. The court must accept the
plaintiff’s uncontroverted allegations and resolve all conflicts
between the facts contained in the parties’ affidavits and other
documentation in favor of jurisdiction. Id.
A

federal

court

sitting

in

diversity

must

satisfy

two

requirements to exercise personal jurisdiction over a nonresident
2

defendant. Pervasive Software Inc. v. Lexware GmbH & Co. Kg, 688
F.3d 214, 220 (5th Cir. 2012). First, the forum state’s long-arm
statute must confer personal jurisdiction. Second, the exercise of
jurisdiction must not exceed the boundaries of the Due Process
Clause of the Fourteenth Amendment. Id. The limits of the Louisiana
long-arm statute are coextensive with constitutional due process
limits. Jackson v. Tanfoglio Giuseppe, SRL, 615 F.3d 579, 584 (5th
Cir. 2010). Thus, the inquiry is whether jurisdiction comports
with federal constitutional guarantees. Id.
This has been interpreted to mean that no federal court may
assume jurisdiction in personam of a non-resident defendant unless
the defendant has certain “minimum contacts” with the forum state
as to “not offend traditional notions of fair play and substantial
justice.” Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945).
Sufficient minimum contacts will give rise to either specific
“case-linked” jurisdiction or general, “all-purpose” jurisdiction.
Goodyear, 131 S. Ct. at 2851.
A

federal

court

sitting

in

diversity

must

satisfy

two

requirements to exercise personal jurisdiction over a nonresident
defendant. First, the forum state's long-arm statute must confer
personal jurisdiction. Second, the exercise of jurisdiction must
not

exceed

the

boundaries

of

the

Due

Process

Clause

of

the

Fourteenth Amendment. Mink v. AAAA Dev. LLC, 190 F.3d 333, 335
(5th Cir.1999). Since the Louisiana long-arm statute extends to
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the limits of federal due process, the inquiry collapses into a
one-step due process analysis. Patin v. Thoroughbred Power Boats
Inc., 294 F.3d 640, 652 (5th Cir.2002).
A.

GENERAL PERSONAL JURISDICTION

A court may exercise general personal jurisdiction over a
defendant consistent with due process when its “affiliations with
the State are so ‘continuous and systematic’ as to render [it]
essentially at home in the forum State.” Daimler, 134 S. Ct. at
761. General jurisdiction permits the cause of action to be
unrelated to the defendant’s extensive contacts within the forum.
Id. at 754. The Supreme Court has articulated a “limited set of
affiliations with a forum [that] will render a defendant amenable
to all-purpose jurisdiction there.” Id. at 760. For an individual,
it is his or her domicile; for a corporation, the paradigmatic
exemplars are where it is incorporated or has its principal place
of business. Goodyear, 131 S. Ct. at 2853-2854. Hyundai Steel
cannot be regarded as “at home” in Louisiana because Louisiana is
not its place of incorporation nor its principal place of business.
(Rec. Doc. 33-1). Thus, Hyundai Steel is not subject to the court’s
general personal jurisdiction.
B.

SPECIFIC PERSONAL JURISDICTION

Courts may exercise specific jurisdiction over a defendant
when the cause of action arises out of or is related to the
defendant’s contacts within the forum. Helicopteros Nacionales de
4

Colombia, S.A. v. Hall, 468 U.S. 408, 414 (1984). The Fifth Circuit
has formulated a three-step inquiry to evaluate whether a defendant
has sufficient minimum contacts so that a court may exercise
personal

jurisdiction:

(1)

whether

the

defendant

purposely

directed its activities to the forum state or purposely availed
itself of the privileges of conducting business there; (2) whether
the plaintiff’s cause of action arises out of or results from the
defendant’s forum related contacts; and (3) whether the exercise
of personal jurisdiction is fair and reasonable. Nuovo Pignone v.
STORMAN ASIA M/V¸ 310 F.3d 374, 378 (5th Cir. 2002)(citing Burger
King Corp. v. Rudzewicz, 471 U.S. 462, 474 (1985)).
The

court

constitute

may

purposeful

assess

whether

availment

Hyundai

under

a

Steel’s

“stream

of

contacts
commerce”

theory when goods made by a foreign manufacturer cause harm in the
forum. J. McIntyre Machinery, Ltd. v. Nicastro, 564 U.S. 873, 881882 (2011); Ainsworth v. Moffett Eng’g, Ltd., 716 F.3d 174, 177
(5th Cir. 2013). Under the Fifth Circuit’s stream of commerce
framework, “mere foreseeability or awareness [that a product would
enter the forum state is] a constitutionally sufficient basis for
personal jurisdiction if the defendant’s product made its way into
the forum state while still in the stream of commerce.” Ainsworth,
716 F.3d at 177. However, “the defendant’s contacts must be more
than ‘random, fortuitous, or attenuated, or of the unilateral

5

activity of another party or third person’ ” ITL Int’l Inc., v.
Constencia, S.A., 669 F.3d 493, 499 (5th Cir. 2012).
In

Cooper

v.

Faith

Shipping,

the

court

found

personal

jurisdiction to exist over a Brazilian seller who had contracted
to ship spools of twine to a distributer in Louisiana. Case No.
06-0892, 2009 U.S. Dist. LEXIS 124303, at*8-9(E.D. La. 2009). The
ship encountered heavy seas causing much of the cargo to shift.
Id. at 3-4*. During unloading, five pallets of twine fell on a
stevedore and he was rendered paraplegic. Id. The court held the
Brazilian seller was within the jurisdiction of the court because
it purposefully directed its shipment of twine to Louisiana and
the Plaintiff’s claim arouse from that contact. Id. at 8-9.
Defendant argues that it did not select Louisiana as a
destination (Rec Doc. 33-2). Consequently, Defendant contends that
under

these

circumstances

it

would

be

inappropriate

to

find

sufficient contacts with the forum. However, in Nuovo Pignone v.
Storman Asia M/V the Fifth Circuit held contractual terms, such as
the point of destination, provide indicators that a defendant’s
contact with the forum may be subject to a suit there. 310 F.3d at
380-381. Such a relationship with the forum is not severed by the
use of subcontractors for shipping. Id. Here, the contract between
Hyundai

Steel

and

its

buyer

included

the

price

as

“CFR

FO

HOUSTON/NOLA, USA (INCOTERMS 2010) - Berth at Louisiana Avenue
(Direct to barge).” (Rec. Doc. 33-2). The Defendant was aware that
6

its steel reinforcing bars would have contacts with the forum in
question. Hyundai Steel cannot now claim that is contact with
Louisiana was merely fortuitous, random, or attenuated after it
entered into a contract specifying Louisiana as the point of
destination. Defendant’s argument that risk and title passed from
seller to buyer and therefore further attenuated its contact with
the forum is unpersuasive to this Court. Under the stream of
commerce analysis a voluntary member of an economic chain that
brought a product to Louisiana still may be considered to have
purposely “availed itself of the privilege of conducting business
in that state.” Nuovo Pignone, 310 F.3d at 380.
Once these constitutionally minimum contacts are established,
the defendant has the burden to make a “compelling case” that
jurisdiction is not reasonable and fair. Wien Air Alaska, Inc. v.
Brandt, 195 F.3d 208, 215 (5th Cir. 1999). Here, Defendant has
made no showing why exercising personal specific jurisdiction
would

be

unfair

or

unreasonable

given

their

connection

to

Louisiana. At this stage in the litigation this Court must consider
“uncontroverted

allegations,

and

resolve

in

[its]

favor

all

conflicts between the facts contained in the parties' affidavits
and other documentation” when evaluating whether the Plaintiff has
made

a

prima

facie

showing

that

exercising

jurisdiction

constitutionally permissible. Nuovo Pignone, 310 F.3d at 378.

7

is

Based

on

successfully

the

facts

establish

of

that

the

complaint

personal

the

Plaintiff

jurisdiction

is

can

present

because (1) the Defendant purposefully directed the shipment of
the reinforced steel bars to Louisiana through the stream of
commerce and its awareness of the destination of its product; (2)
the Plaintiff’s claim arises out of that contact with Louisiana;
and (3) the exercise of jurisdiction is not unfair or unreasonable.
Nuovo Pignone, 310 F.3d at 378.

New Orleans, Louisiana, this 24th day of May, 2017.

___________________________________
SENIOR UNITED STATES DISTRICT JUDGE

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