Ergon Oil Purchasing, Inc. v. Canal Barge Company, Inc. et al

Filing 30

ORDER and REASONS - IT IS ORDERED that "Defendant Southwest Shipyard, L.P.'s Rule 12(b)(2) Motion to Dismiss" (Rec. Doc. 13) is GRANTED. Accordingly, IT IS FURTHER ORDERED that Plaintiff Ergon Oil Purchasing, Inc.'s claims against Defendant Southwest Shipyard, L.P., be and hereby are DISMISSED WITHOUT PREJUDICE, as stated within document. Signed by Chief Judge Kurt D. Engelhardt on 6/26/2017. (cbs)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF LOUISIANA
ERGON OIL PURCHASING, INC.

CIVIL ACTION

v.

NO. 16-5884

CANAL BARGE COMPANY, INC.,
SAYBOLT, L.P., AND
SOUTHWEST SHIPYARD, L.P.

SECTION: “N” (3)

ORDER AND REASONS
In this action, Plaintiff Ergon Oil Purchasing, Inc., alleges that Defendant Southwest
Shipyard, L.P. (“Southwest”) failed to properly strip and clean barge CBC 7078, prior to loading
Plaintiff’s cargo onto the vessel, which caused the cargo to be damaged and contaminated.
Plaintiff thus seeks an award of damages.1 Contending the Court lacks personal jurisdiction over
it, Southwest has filed, pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure, the
motion to dismiss (Rec. Doc. 13) now before the Court. Having carefully reviewed the parties’
submissions, the record herein, and applicable law, IT IS ORDERED that the motion to dismiss
is GRANTED for the reasons stated herein. Accordingly, IT IS FURTHER ORDERED that
Plaintiff’s claims against Southwest be and hereby are DISMISSED WITHOUT PREJUDICE.

1

See Complaint, Rec. Doc. 1, ¶¶ 3-4.

1

BACKGROUND
In May 2015, Plaintiff, a Mississippi corporation, chartered barge CBC 7078 from
Defendant Canal Barge Company, Inc. (“Canal Barge”), a Louisiana corporation with its principal
place of business in New Orleans, Louisiana. Pursuant to the charter, Plaintiff’s cargo was to be
loaded onto the barge in Texas City, Texas, for transport to and discharge at Plaintiff’s Vicksburg,
Mississippi terminal.2 Thereafter, the barge was to be redelivered in Lake Charles, Louisiana.3
In preparation for barge CBC 7078’s voyage, Canal Barge contracted with Southwest for
barge cleaning services to be provided at Southwest’s Channelview, Texas facility prior to
Plaintiff’s cargo being loaded in Texas City.4 Plaintiff, however, alleges that Southwest failed to
follow cleaning instructions provided to it, leaving pre-existing substances within the barge’s tanks
that contaminated and damaged Plaintiff’s cargo during transport.5 As a result, Plaintiff filed this
lawsuit, seeking compensatory damages from Southwest and the other defendants. With the
instant motion, Southwest, a non-resident Texas corporation with its principal place of business in
Channelview, Texas,6 asks the Court to dismiss Plaintiff’s claims against it for lack of personal
jurisdiction.

2

Id. at ¶ 4, ¶ 9.
Id. at ¶¶ 3-4.
4
Id. at ¶ 10.
5
Id. at ¶ 16.
6
Id. at ¶ 10.
3

2

LAW AND ANALYSIS
When a nonresident defendant moves to dismiss for lack of personal jurisdiction, the
plaintiff bears the burden of showing that personal jurisdiction exists. See Stuart v. Spademan, 772
F.2d 1185, 1192 (5th Cir. 1985). When a court rules on the issue without a full evidentiary hearing,
a plaintiff need only make a prima facie showing of jurisdiction. See Wilson v. Belin, 20 F.3d 644,
648 (5th Cir. 1994). In determining whether a plaintiff has made a prima facie showing of
jurisdiction, the court accepts the allegations in the complaint as true, unless controverted by
opposing affidavits, and resolves all factual conflicts in favor of the plaintiff. Id. In making its
determination, the court may consider “affidavits, interrogatories, depositions, oral testimony, or
any combination of . . . recognized [discovery] methods.” Thompson v. Chrysler Motors Corp.,
755 F.2d 1162, 1165 (5th Cir. 1985).
In this instance, for the Court to have personal jurisdiction over non-resident defendant
Southwest, the Louisiana long-arm statute must confer jurisdiction consistent with constitutional
due process. Patin v. Thoroughbred Power Boats Inc., 294 F.3d 640, 652 (5th Cir. 2002).
Louisiana’s long-arm statute, Louisiana Revised Statute 13:3201, extends jurisdiction to the full
limits of constitutional due process. See Dickson Marine Inc. v. Panalpina, Inc., 179 F.3d 331, 336
(5th Cir. 1999) (citing LSA-R.S. 13:3201(B); Petroleum Helicopters, Inc. v. Avco Corp., 513
So.2d 1188, 1191 (La. 1987)). Thus, the Court’s inquiry is limited to whether the exercise of

3

personal jurisdiction over Southwest comports with constitutional due process. Patin, 294 F.3d at
652.
The Due Process Clause of the Fourteenth Amendment protects a defendant from being
subjected to “the binding judgments of a forum with which he has established no meaningful
‘contacts, ties, or relations.’” Burger King v. Rudzewicz, 471 U.S. 462, 471-72 (1985) (quoting
International Shoe Co. v. Washington, 326 U.S. 310, 319 (1945)). The Due Process Clause thus
requires that individuals have “fair warning that a particular activity may subject [them] to the
jurisdiction of a foreign sovereign,” to allow “potential defendants to structure their [] conduct
with some minimum assurance as to where that conduct will and will not render them liable to
suit.” Burger King, 471 U.S. at 472 (internal citations omitted). The requisite fair warning is
satisfied when the defendant has established “minimum contacts” with the forum state and the suit
does not offend “traditional notions of fair play and substantial justice.” International Shoe Co.,
326 U.S. at 316.
The minimum contacts analysis requires that a non-resident defendant have purposefully
availed itself of the privileges of the forum state by conducting activities there, or purposefully
directing activity toward that state, thus subjecting itself to suit in that forum. See Goodyear
Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 924 (2011) (internal citations omitted);
World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980). The “defendant's conduct
and connection with the forum State [must be] such that he should reasonably anticipate being

4

haled into court there.” World-Wide Volkswagen Corp., 444 U.S. at 297. Thus, the necessary
minimum contacts must not be “random,” “fortuitous,” or “attenuated,” and must be initiated by
the defendant and not a third party or the plaintiff. Burger King, 471 U.S. at 475 (internal citations
omitted).
Personal jurisdiction over a non-resident defendant may be general (“all purpose”) or
specific (“case-linked”). Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco
Cty., No. 16-466, 2017 WL 2621322, *6 (U.S. June 19, 2017) (quoting Goodyear Dunlop Tires
Operations, S.A., 564 U.S. at 919)). A court with general jurisdiction may hear any claim against
that defendant even if all the incidents underlying the claim occurred in a different State.” Id.
General personal jurisdiction exists, however, only when a non-resident defendant’s contacts with
the forum state, though unrelated to the cause of action at issue, are so continuous and systematic
as to render the defendant “essentially at home” there. Goodyear Dunlop Tires Operations,
S.A.,564 U.S. at 919 (citing International Shoe, 326 U.S. at 317); see also BNSF Ry. Co. v. Tyrrell,
137 S. Ct. 1549, 1559 (2017) (more than 2,000 miles of railroad track and more than 2,000
employees in forum state insufficient to provide general jurisdiction because inquiry does not focus
solely on magnitude of in-state contacts); Helicopteros Nacionales de Colombia, S.A. v. Hall, 466
U.S. 408 (1984) (traveling to Texas for contract negotiation, accepting checks from Houston bank,
purchasing helicopters from Texas corporation, and sending personnel to Texas for training did
not confer general jurisdiction over non-resident defendant).

5

On the other hand, a court has specific personal jurisdiction over a non-resident defendant
when the litigation arises from the defendant’s minimum contacts with the forum state. Burger
King, 471 U.S. at 472 (litigation arising from non-resident’s alleged breach of its contract with
Florida corporation provided specific jurisdiction in Florida forum). That is, “specific jurisdiction
is confined to adjudication of issues deriving from, or connected with, the very controversy that
establishes jurisdiction.” Bristol-Myers Squibb Co., No. 16-466, 2017 WL 2621322, at *6).
Here, Plaintiff first alleges Southwest’s contacts with Louisiana are sufficiently continuous
and systematic such that the Court has general jurisdiction over it. These contacts include three
years (2015-2017) of annual golf tournament sponsorship for Junior Achievement of Greater New
Orleans (JAGNO) and advertising in the accompanying tournament program; participation in
JAGNO’s 2017 bowl-a-thon; yearly attendance at the International Workboat Show in New
Orleans; four or five annual sales calls in Louisiana; four fishing trips in Louisiana with Louisiana
and Texas customers over the last two years; and contracts with other Louisiana businesses.7
Applying the legal principles set forth above, the Court disagrees with Plaintiff. Annual
participation in a couple of charitable events and a workboat show attended by industry members
from numerous states, along with a handful of sales calls to Louisiana customers for work to be
performed in Texas, cannot be said to provide Southwest with such continuous and systematic
contacts with Louisiana as to render it essentially at home there.

7

See Rec. Doc. 18 at 8; Rec. Doc. 13-2 at 2.

6

This is particularly true given the nature and situs of Southwest’s operations. As urged by
Southwest, all of its work is carried out at its Texas facilities and it has no employees who regularly
carry out work in Louisiana. Rather, Southwest’s gas freeing and cleaning services, barge and boat
repair, and other services, are provided to vessels from Louisiana and other states navigating near
its Texas facility. Furthermore, Southwest owns no property in Louisiana, has no equipment
located in Louisiana, and pays no property or business taxes in Louisiana.8 Accordingly, the Court
finds Southwest lacks the necessary Louisiana contacts required for this Court to have general
jurisdiction over non-resident defendant Southwest.
Plaintiff also alleges that the Court has specific jurisdiction over Southwest.9 As set forth
above, to determine whether specific jurisdiction exists, the Court “must examine the relationship
among the defendant, the forum, and the litigation.” Holt Oil and Gas Corp. v. Harvey, 801 F.2d
773, 924 (5th Cir. 1986). In making this inquiry, the Fifth Circuit follows a three-pronged test:
“(1) whether the defendant has minimum contacts with the forum state, i.e., whether it purposely
directed its activities toward the forum state or purposely availed itself of the privileges of
conducting activities 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, SpA v. Storman Asia M/V, 310 F.3d 374, 378 (5th Cir. 2002). If
the first two prongs are met by Plaintiff’s prima facie showing, the burden shifts to the non-resident

8
9

Id.
See Rec. Doc. 18 at 4.

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defendant to defeat jurisdiction by demonstrating its exercise would be unfair or unreasonable.
See, e.g., Seiferth v. Helicopteros Atuneros, Inc., 472 F.3d 266, 271 (5th Cir. 2006).
“If a defendant has deliberately engaged in significant activity in a state or created
continuing obligations between itself and residents of the state, it has availed itself of the privilege
of conducting business there; in such a circumstance, it is not unreasonable to require it to submit
to the burdens of litigation in that forum.” Special Indus., Inc. v. Zamil Grp. Holding Co., 578 F.
App'x 325, 328 (5th Cir. 2014) (citing Burger King, 471 U.S. at 475-76). “The requirement that a
defendant's business activity be deliberate prevents jurisdiction from arising from mere ‘random,
fortuitous, or attenuated contacts, or [from] the unilateral activity of another party or a third
person.’” Id. (quoting Burger King, 471 U.S. at 475).
Even a single contact can provide specific jurisdiction if the contact creates a “substantial
connection” with the forum state. Burger King, 471 U.S. at 476 n.18 (citing McGee v. Int’l Life
Ins. Co., 355 U.S. 220, 223 (1957)). It is well established, however, that merely contracting with
a resident of the forum state is alone not sufficient to confer specific jurisdiction over a nonresident defendant. Holt Oil and Gas Corp. at 778 (5th Cir. 1986) (citing Burger King, 471 U.S.
462, 478-79)). Rather, the Court must additionally consider “prior negotiations,” “contemplated
future consequences,” contract terms, and the “parties’ actual course of dealing” to determine
whether a contract amounts to a purposeful minimum contact with the forum state. Burger King,
471 U.S. at 479. Contractual relationships that anticipate “continuing and wide-reaching contacts”

8

in the forum state can provide sufficient minimum contacts to confer specific jurisdiction. See,
e.g., Burger King, 471 U.S. at 480 (specific jurisdiction found in Florida forum where non-resident
defendant and Florida corporation entered into a 20-year contract anticipating continuing and
wide-reaching contacts in Florida); McGee, 355 U.S. at 223 (defendant’s assumption of
predecessor’s obligations, subsequent mailing of offer of insurance to California insured, and
receipt of premiums mailed from California conferred specific jurisdiction in California over nonresident defendant).
Applying the Fifth Circuit’s test for specific jurisdiction, the Court must first determine
whether Southwest established minimum contacts with the state of Louisiana by purposely
directing its activities toward the state, or purposefully availing itself of the privilege of conducting
activities here. As previously stated, the contract between Southwest and Canal Barge cannot in
itself constitute a minimum contact without consideration of negotiations, contemplated
consequences, contract terms, and actual course of dealing. In this instance, Southwest provided
services to Canal Barge’s vessel upon Canal Barge’s order. Further, the contemplated future
consequences of this contract were anticipated to occur in Texas: all work was to be performed at
Southwest’s facilities in Channelview, Texas, because it only maintains facilities in Texas.
Additionally, the parties’ actual course of dealing demonstrates that Canal Barge regularly
delivered barges to Southwest’s facilities in Channelview, Texas, given the close proximity of
Canal Barge’s nearby fleeting facility, and that Southwest completed all work there. No long-term

9

continuing contractual relationship between the two, however, is alleged. In any event, moreover,
it is far from apparent that the business relationship between Southwest and Canal Barge
anticipated continuing and wide-reaching contacts in Louisiana. Thus, Southwest’s contractual
relationship with Canal Barge, considered alone, is insufficient to confer specific jurisdiction.
To bolster its specific jurisdiction argument, Plaintiff alleges Southwest purposely directed
other activities toward Louisiana from which Southwest’s provision of services to Canal Barge in
Texas, and the resulting litigation, arose.

In particular, Plaintiff again references the

aforementioned sponsorship of annual charitable golf tournaments, its advertising in an
accompanying JAGNO program, its participation in JAGNO’s 2017 bowl-a-thon, its annual
attendance at the International Workboat Show in New Orleans, its attendance at the formal
christening of a towboat in Louisiana, its annual sales calls in Louisiana, and its four fishing trips
in Louisiana over the prior two years for client development. Plaintiff argues Southwest
purposefully directed these activities at Louisiana in hopes of attracting and maintaining business
from Louisiana for Southwest’s services in Texas.

Plaintiff additionally emphasizes that

Southwest does not deny that it initiated these activities, with the exception of Blessey Marine’s
invitation to witness the christening of a towboat in Louisiana.
The Court finds, on the limited showing made, that Plaintiff has failed to carry its burden
of making a prima facie showing of specific personal jurisdiction as to defendant Southwest in this
Louisiana forum. While Southwest’s Executive Vice President and Chief Financial Officer Martin

10

DeCamp acknowledges that the activities cited by Plaintiff “are for the purpose of soliciting work
to be conducted in Texas[,] and maintaining customer relations in anticipation of work being
requested by [Southwest’s] customers . . . whose barges and vessels are transiting Texas’ waters,”
he further avers that the cleaning services at issue were “not the product of any particular contact
with or travel . . . into Louisiana.10 Rather, he attributes Southwest’s being hired by Canal Barge
to its “experience, pricing and favorable location as Canal’s vessels pass through the Port of
Houston and Canal’s San Jacinto River fleeting area.”11
In response, Plaintiff offers only vague and conclusory speculation that the necessary
connection required for specific jurisdiction is present, while failing to even mention, much less
account for, the logical significance of the close physical proximity of Canal Barge’s Texas
fleeting facility to Southwest’s Channelview, Texas shipyard.12 Although certain of
aforementioned activities likely provided networking and marking opportunities to Southwest,
e.g., attending the annual International Workboat Show in New Orleans,13 and occasional
Louisiana fishing trips, a direct tie to Canal Barge, however, is alleged relative to neither conduct.
Under the given circumstances, such general assertions – without a specific evidentiary tie to Canal
Barge and the barge cleaning services in question – are insufficient evidence of specific
jurisdiction. See Bristol-Myers Squibb Co., supra. Finally, Plaintiff fails to demonstrate that it is
10

See Affidavits of Martin DeCamp, Rec. Docs. 13-2 at and 22-1 at 2.
Rec. Doc. 22-1 at 2.
12
Notably, the Court is not aware of any request from Plaintiff for preliminary jurisdictional discovery directed to the
origin and parameters of Canal Barge’s contractual relationship(s) with Southwest.
13
Significantly, Plaintiff offers no contradiction of Southwest’s assertion that it has never set up or maintained a booth,
demonstration, or advertising at the annual workboat show. See Rec. Doc. 22-1 at 2.
11

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qualified, or possesses sufficient organizational knowledge, to speak on behalf of Canal Barge
regarding the genesis and subsequent parameters of the contractual relationship at issue, i.e., that
between Canal Barge and Southwest, not Plaintiff and Southwest.
To reach the conclusion that Southwest’s relationship with Canal Barge arose from
Southwest’s limited contacts with Louisiana would require impermissibly attenuated inferences to
be drawn. This the Court cannot do. Accordingly, Southwest’s motion to dismiss Plaintiff’s claims
against it for lack of personal jurisdiction is granted.
CONCLUSION
Because Plaintiff has failed to make a prima facie showing of the existence of general or
specific personal jurisdiction over Defendant Southwest, IT IS ORDERED that “Defendant
Southwest Shipyard, L.P.’s Rule 12(b)(2) Motion to Dismiss” (Rec. Doc. 13) is GRANTED.
Accordingly, IT IS FURTHER ORDERED that Plaintiff Ergon Oil Purchasing, Inc.’s claims
against Defendant Southwest Shipyard, L.P., be and hereby are DISMISSED WITHOUT
PREJUDICE.
New Orleans, Louisiana, this 26th day of June 2017.

Kurt D. Engelhardt
United States District Judge

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