Matheson Tri-Gas Inc v. Williamson General Contractors Inc

Filing 60

MEMORANDUM ORDER denying 50 APPEAL OF MAGISTRATE JUDGE DECISION to District Judge, affirming 48 Order on Motion to Dismiss/Lack of Jurisdiction, Order on Motion for Miscellaneous Relief, filed by Taiyo Nippo Sanso Corp. Signed by Chief Judge S Maurice Hicks, Jr on 10/11/2018. (crt,McDonnell, D)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF LOUISIANA
LAKE CHARLES DIVISION
MATHESON TRI-GAS, INC.

CIVIL ACTION NO. 16-1303

VERSUS

JUDGE S. MAURICE HICKS, JR.

WILLIAMSON GENERAL
CONTRACTORS, INC.

MAGISTRATE JUDGE KAY

MEMORANDUM ORDER
Before the Court is a Magistrate Appeal (Record Document 50) filed by Taiyo
Nippon Sanso Corporation (“TNSC”).1 TNSC objects to and appeals the Magistrate
Judge’s Memorandum Order (Record Document 48) dated July 27, 2018, granting
defendant Williamson General Contractors, Inc.’s (“Williamson”) request for jurisdictional
discovery and denying as moot TNSC’s motion to dismiss. For the reasons set forth
below, the Magistrate Appeal (Record Document 50) is DENIED and Magistrate Judge
Kay’s Memorandum Order (Record Document 48) of July 27, 2018 is AFFIRMED.
Any party may appeal a magistrate judge’s ruling on a non-dispositive matter to a
district court judge under Rule 72(a) of the Federal Rules of Civil Procedure and Local Rule
74.1. The decision by Magistrate Judge Kay to grant Williamson’s request for jurisdictional
discovery is a non-dispositive matter. It is an order from the magistrate judge on a
non-dispositive matter that requires the district court to uphold the ruling unless it is clearly
erroneous or contrary to law. See 28 U.S.C. § 636(b)(1)(A) & Fed. R. Civ. P. 72(a); see
also Castillo v. Frank, 70 F.3d 382, 385 (5th Cir. 1995); Perales v. Casillas, 950 F.2d 1066,

1

TNSC made a special appearance in the litigation solely for the purpose of filing
a Motion To Dismiss For Lack Of Personal Jurisdiction. See Record Document 41.

1070 (5th Cir.1992). This Court will review the Magistrate Judge’s legal conclusions de
novo, and will review her factual findings for clear error. See Escamilla v. M2 Tech., Inc.,
581 F. App’x 449, 451 (5th Cir. 2014); Choate v. State Farm Lloyds, No. 03-CV-2111, 2005
WL 1109432, *1 (N.D.Tex. May 5, 2005).
This matter began as a breach of contract suit involving the building of Matheson
Tri-Gas, Inc.’s Pelican Phase I plant. Matheson alleged that its contractor, Williamson,
demanded additional, unreasonable sums to complete the facility and then abandoned the
project, in breach of the parties’ agreements. See Record Document 1. Williamson filed
counterclaims against Matheson and then, in an amended counterclaim, also named
Matheson’s parent company, TNSC, a Japanese corporation, as a counter defendant. See
Record Documents 6 and 24. TNSC then filed a motion to dismiss for lack of personal
jurisdiction. See Record Document 41. Williamson countered that the court could exercise
specific jurisdiction over TNSC as a result of its contacts in this forum related to the Pelican
Phase I plant. See Record Document 43.
In support of its assertion of specific jurisdiction, Williamson relied upon, inter alia,
an affidavit from its president wherein he stated that individuals who represented that they
were TNSC employees were present at the Pelican Phase I plant and that TNSC issued
an initial set of revised drawings. See id. TNSC countered with its own affidavit that the
individuals were not TNSC employees. See Record Document 47, Ex. A. However,
Magistrate Judge Kay specifically noted in her Memorandum Order that one of these
individuals was also identified as a TNSC executive in initial interrogatory responses and
in TNSC’s annual report. See Record Document 48 at 2-3. She then observed that “[t]he
conflicting evidence and assertions about TNSC’s involvement in the Pelican project and
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which employer the three individuals referenced in the affidavit were actually serving
prevents Williamson of meeting its burden of setting forth a prima facie case for the
exercise of jurisdiction over TNSC.” Id. at 3. Therefore, she turned to the request for
jurisdictional discovery. She concluded that Williamson’s evidence was “sufficient to raise
issues of fact related to the court’s ability to exercise personal jurisdiction over TNSC,
specifically relating to TNSC’s contacts with the forum state and the nexus between those
contacts and the claims against TNSC.” Id.2
In the instant appeal, TNSC contends that Magistrate Judge Kay erred because she
should have recommended dismissal of the amended counterclaim against TNSC and not
allowed Williamson’s request for jurisdictional discovery based upon its scant assertions
of jurisdiction and need. See Record Document 50. The Court disagrees. Magistrate
Judge Kay’s decision to deny the motion to dismiss as moot and grant Williamson’s
request for jurisdictional discovery was a proper exercise of judicial discretion and was
neither clearly erroneous or contrary to law.3 See Moore v. Ford Motor Co., 755 F.3d 802,
808 (5th Cir. 2014) (“[D]iscovery decisions of the trial judge [are reviewed] for abuse of
discretion.”).
“A plaintiff is not entitled to jurisdictional discovery when ‘the record shows that the
requested discovery is not likely to produce the facts needed to withstand a Rule 12(b)(1)

2

Magistrate Judge Kay also acknowledged that Williamson had not directly identified
the discovery needed but attributed this to “the gaps remaining in Williamson’s effort to
carry its burdeon on the motion to dismiss.” Record Document 50 at 3-4.
3

TNSC also objects to Magistrate Judge Kay’s denial of its motion to dismiss as a
dispositive matter subject to de novo review. See Record Document 50 at 4 (citing
Davidson v. Georgia-Pacific, LLC, 819 F.3d 758, 762 (5th Cir. 2016)). This Court finds that
her decision is also supported under a de novo review.
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motion.’” Monkton Ins. Servs., Ltd. v. Ritter, 768 F.3d 429, 434 (5th Cir. 2014), quoting
Freeman v. United States, 556 F.3d 326, 342 (5th Cir. 2009). This is simply not the case
herein. The Court agrees with Magistrate Judge Kay’s analysis that Williamson’s evidence
was “sufficient to raise issues of fact related to the court’s ability to exercise personal
jurisdiction over TNSC, specifically relating to TNSC’s contacts with the forum state and
the nexus between those contacts and the claims against TNSC.” Record Document 48
at 3. The Magistrate Judge’s ruling as to Williamson’s request for jurisdictional discovery
and resulting denial of TNSC’s motion to dismiss as moot will, therefore, be upheld.
Accordingly,
IT IS ORDERED that the Magistrate Appeal (Record Document 50) filed by TNSC
is DENIED and that Magistrate Judge Kay’s Memorandum Order (Record Document 48)
of July 27, 2018 is AFFIRMED.
THUS DONE AND SIGNED, in Shreveport, Louisiana, this 11th day of October,
2018.

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