The Appellate Record : Texas Appellate Lawyer & Attorney Kendall Gray for Fifth Circuit & Supreme Court Appeals

 

On Monday, the Fifth Circuit released Jacskon v. Tanfoglio Giuseppe S.R.L. (pdf) affirming the district court’s dismissal for lack of personal jurisdiction over the affiliate of a defunct Italian firearms manufacturer. Judge Garza wrote the court’s opinion.

It only took three appeals to finally result in the district court's dismissal of an affiliate that did not manufacture any part of the allegedly defective firearm. Along the way, the Court held:

• There was no general jurisdiction based upon two unrelated trade show visits, untargeted national advertising and shipment of components (for other than the firearm in question) to Florida for assembly;
• There was no specific jurisdiction based upon the stream of commerce theory principally because the defendant did not start manufacturing the model of firearm at issue until after the decedent’s accident; and
• The jurisdictional contacts of the defunct affiliate that manufactured the firearm could not be attributed to the defendant because they were not alter egos or a single enterprise--the companies had maintained all the corporate formalities required by Italian law and had properly liquidated the failed manufacturer under Italian law.

Also of interest on Monday was Combo Maritime, Inc. v. U.S. United Bulk Terminal (pdf), which deals with settlement, contribution issues, and presumptions in maritime collision cases. It gets an honorable mention just for citing a really really old admiralty doctrine deriving from the Laws of Oleron in the 12th century. 

Evidentiary presumptions and 12th century law from the Consolato del Mare.* It just doesn’t get any better than this.

 

*According to the History of Law website, The Consolato del Mare inspired the second great code of maritime regulation, the Laws of Oleron, which are supposed to have been compiled about A.D. 1150. It is generally understood that we owe them to a woman, Eleanor, Duchess of Guienne, Queen first of Louis VII of France, who procured a divorce from her, and afterwards of Henry II of England, the first of the Plantagenets.

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Wednesday, the Fifth Circuit released Choice Health Care Inc. v. Kaiser Health Plan of Colorado (pdf) in which it upheld the dismissal of a foreign health insurer/HMO for lack of personal jurisdiction.  The court rejected an attempted extension of the "stream of commerce" theory of minimum contacts in an opinion written by Circuit Judge Davis. 

After the break, analysis and details of the opinion.

Continue Reading...

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Yesterday, the Fifth Circuit released Willow Bend v. Downtown ABQ Partners, a personal jurisdiction case that will be of interest to commercial practitioners.  The contractual and breach of fiduciary duty claims arose out of a Louisiana real property transaction.  The Court affirmed a dismissal for lack of personal jurisdiction as to a non-signatory individual (Garcia) and the partnership for which that person was the managing partner (Downtown ABQ).   Judge Higginbotham wrote the Court's opinion. 

Determining minimum contacts can sometimes be like trying to nail jello to a tree.  But Judge Higginbotham (in characteristic fashion) gives the analysis some structure. 

Judge Higginbotham's take on minimum contacts requires a nexus between:

• the forum;
• a particular party; and
• a substantive legal duty actually pertaining to that specific party. 

The nexus was present with regard to the company that actually entered into the contract.  It did not exist for Garcia, nor for the partnership managed by Garcia.  The reason: the duties alleged were tethered to the contract to which they were not a party and did not apply to them.

This paragraph from the opinion sums it up:

[The] written agreement is no throwaway: in fact, it is the critical forum contact in this case, and the linchpin of the district court’s exercise of jurisdiction over Blue Dot. Willow Bend’s winning breach of contract and breach of fiduciary duty claims against Blue Dot arose out of and resulted from Blue Dot’s primary contact with the state of Louisiana—its contract with Willow Bend. Without a contract tying the non-signatories Garcia and Downtown ABQ to Willow Bend’s claims against them, however, those claims share an inadequate nexus to the forum: . . .  Willow Bend sued for breach of contract and breach of fiduciary duty, after all, and a defendant cannot be said to have breached a contract it never made or to have skirted a duty it never assumed. . . . Willow Bend contracted with Blue Dot—and Blue Dot alone—and it is with Blue Dot that its claims for breach of contract and breach of fiduciary duty must lie.

Thus, jurisdiction and the merits are enmeshed because jurisdiction is "claim specific." Had the breach of a different legal duty that applied to the non-signatories been alleged (e.g., fraud) a different result might have obtained. 

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That incredibly geeky sound you heard over the weekend was the sound of delight as civil procedure profs and appellate lawyers thrilled over the new Fifth Circuit opinions.  What could be better than federal subject matter jurisdiction involving alienage, diversity and removal?

•  In Halmekangas v. State Farm the defendant removed a case to federal court that had no independent basis for federal subject matter jurisdiction, arguing that it was related to a Katrina coverage case already pending in federal court and would fall under the court's "supplemental jurisdiction" (28 U.S.C. 1367).  The Fifth Circuit said, "Interesting argument, but no. Every case must have its own basis for federal jurisdiction before non-federal claims may hitch a ride."  Judge Higginbotham wrote the opinion. 
• Berik Stiftung v. Plains Marketing involved the wonderfully arcane question of how a Lichtensteinian entity ought to be treated for determining diversity of citizenship jurisdiction.  Berik Stiftung argued that it was like a trust under U.S. law and the court should consider only the citizenship of its beneficiaries (i.e., Florida v. Canada and Texas).  Plains argued that Berik Stiftung was more like a corporate person so that the court should consider the state of its incorporation (i.e. Lichtenstein v. Canada and Texas).   This would mean damn foreigners on both sides of the "v," no diversity of citizenship and no federal jurisdiction. 

Plains won.  Judge DeMoss wrote the opinion and got to use the words "res nova" and  “juristische Person.”  Nice touch, that.

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It was forum shopping day at the Supreme Court of Texas.  The Court released two mandamuses mandamii mandamae opinions granting petitions for writ of mandamus in which choice of forum was key.

• In re United Services Automobile Association (pdf) involves the question of whether limitations ought to have been tolled (it was not) where the plaintiff's claim exceeded the jurisdictional limits of the county court at law where he chose to file it.  Tolling depends upon whether the filing was made in "intentional disregard of proper jurisdiction" (it was).  Chief Justice Jefferson wrote the Court's opinion.
• In re Liabe Corporation (pdf) involves application of a forum selection clause to commercial actors complaining about equipment that did not work right.  The court only had to resolve fairly pedestrian contract formation questions about whether the plaintiff really really really agreed to bring suit in Indiana (it did) and whether The Hoosier State was really really really inconvenient (it was not).  As a result, the prolific Justice Per Curiam wrote the opinion.

I want to read United Services in more detail this weekend and perhaps write more.  It is certainly a new candidate to be added to the Practice Court reading list at Baylor Law School, highlighting as it does the complexity of trial court jurisdiction in Texas.  Fodder for Socratic torture questioning that is.  United Services also includes some important new wrinkles to the "inadequate remedy by appeal" standard given that denial of summary judgment is ordinarily not a subject for mandamus relief.

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