Smith v. T R W Automotive U S L L C

UNITED STATES DISTRICT COURT

WESTERN DISTRICT OF LOUISIANA

SHREVEPORT DIVISION

HERBERT WAYNE SMITH, ET AL. CIVIL ACTION NO. 18-0995

VERSUS JUDGE S. MAURICE HICKS, JR.

TRW AUTOMOTIVE U.S., LLC, ET AL. MAGISTRATE JUDGE HORNSBY

MEMORANDUM RULING

Before the Court is Defendant ZF Active Safety and Electronics US LLC’s (“ZF

ASE LLC”)1 Motion to Dismiss pursuant to Federal Rule of Civil Procedure 12(b)(2). See

Record Document 12. Also, before the Court is Defendant ZF Passive Safety Systems

US Inc.’s (“ZF PSS”)2 Motion to Dismiss pursuant to Federal Rule of Civil Procedure

12(b)(2). See Record Document 15. Plaintiffs Herbert Smith and Kimberly Smith

(collectively “Plaintiffs”) oppose both motions. See Record Documents 23 & 24. For the

reasons set forth below, both motions are hereby GRANTED.

FACTUAL & PROCEDURAL BACKGROUND

Plaintiffs brought the instant suit on July 13, 2018 in the 26th Judicial District Court,

Bossier Parish, Louisiana. See Record Document 1-1. Plaintiffs allege the airbag in their

2008 Dodge Caravan deployed without reason causing significant damage to Herbert

Smith. See id. at 3–4. The complaint asserts claims of negligence, intentional infliction of

emotional distress, and strict liability against multiple defendants, including ZF ASE LLC

and ZF PSS. See id. at 2. The complaint alleges ZF ASE LLC supplied the airbag for the

2008 Dodge Caravan. See id. at 5. Further, the complaint alleges ZF PSS supplied the

Occupant Restraint Control Module for the 2008 Dodge Caravan. See id.

1 ZF ASE LLC was formerly known as TRW Automotive U.S. LLC. See Record Document 27.

2 ZF PSS was formerly known as TRW Vehicle Safety Systems Inc. See Record Document 28.

The suit was removed to this Court on August 1, 2018 by Defendant FCA US LLC.

See Record Document 1. ZF ASE LLC and ZF PSS filed the instant motions to dismiss

asserting they are not subject to personal jurisdiction in Louisiana. See Record

Documents 12 & 15. Plaintiffs oppose the motions. See Record Documents 23 & 24.

Defendants filed replies. See Record Documents 25 & 26.

LAW AND ANALYSIS

I. Legal Standards

a. Federal Rule of Civil Procedure 12(b)(2)

A motion pursuant to Federal Rule of Civil Procedure 12(b)(2) allows a party to

move to dismiss a claim for lack of personal jurisdiction. “Where a defendant challenges

personal jurisdiction, the party seeking to invoke the power of the court bears the burden

of proving that jurisdiction exists.” Luv N’ Care, Ltd. v. Insta-Mix, Inc., 438 F.3d 465, 469

(5th Cir. 2006) (citations omitted). At this stage in the litigation, the plaintiff need only

make a prima facie case for personal jurisdiction. See Walk Haydel & Assoc., Inc. v.

Coastal Power Prod. Co., 517 F.3d 235, 241 (5th Cir. 2008).

In consideration of the motion, the court may consider: “affidavits, interrogatories,

depositions, oral testimony, or any combination of the recognized methods of discovery.”

Stuart v. Spademan, 772 F.2d 1185, 1192 (5th Cir. 1985). However, the court “should not

act as a factfinder and must construe all disputed facts in the plaintiff’s favor.” Walk Haydel

& Assoc., Inc., 517 F.3d at 241. Further, “conflicts between the facts contained in the

parties’ affidavits must be resolved in the plaintiff’s favor for purposes of determining

whether a prima facie case for personal jurisdiction exists.” Bullion v. Gillespie, 895 F.2d

213, 217 (5th Cir. 1990) (internal citations omitted).

b. Personal Jurisdiction

“A federal court may exercise personal jurisdiction over a nonresident defendant if

(1) the forum state's long-arm statute confers personal jurisdiction over that defendant;

and (2) the exercise of personal jurisdiction comports with the Due Process Clause of the

Fourteenth Amendment.” McFadin v. Gerber, 587 F.3d 753, 759 (5th Cir. 2009). The

Louisiana long-arm statute authorizes personal jurisdiction to the limits of constitutional

due process. See La. Rev. Stat. § 13:3201(b); see also A & L Energy, Inc. v. Pegasus

Grp., 200-3255, p. 4 (La. 6/29/01); 791 So.2d 1266, 1270. Thus, the Court need only

consider whether the exercise of personal jurisdiction over Defendants comports with the

Due Process Clause.

To satisfy the requirements of due process the plaintiff must show: (1) the

defendant has purposefully availed itself of the benefits and protections of the forum state

by establishing “minimum contacts” with that state; and (2) the exercise of personal

jurisdiction does not offend “traditional notions of fair play and substantial justice.”

McFadin, 587 F.3d at 759 (internal citations omitted). The “minimum contacts” prong can

be further subdivided into general or specific personal jurisdiction. Choice Healthcare,

Inc. v. Kaiser Found. Health Plan of Colorado, 615 F.3d 364, 368 (5th Cir. 2010).

General jurisdiction exists where the defendant’s “affiliations with the State are so

‘continuous and systematic’ as to render them essentially at home in the forum state.”

Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919, 131 S.Ct. 2846,

2851 (2011). General jurisdiction is extremely difficult to establish and requires proof of

“extensive contacts between a defendant and a forum.” Johnson v. Multidata Sys. Intern.

Corp., 523 F.3d 602, 609 (5th Cir. 2008).

Specific jurisdiction, on the other hand, can be established when the defendant’s

contacts are less extensive. Specific jurisdiction can exist over a nonresident defendant

“whose contacts with the forum state are singular or sporadic if the cause of action

asserted arises out of or is related to those contacts.” Int’l Energy Ventures Mgmt., LLC,

United Energy Grp., Ltd., 818 F.3d 193, 212 (5th Cir. 2016) (emphasis in original). This

inquiry “focuses on the relationship among the defendant, the forum, and the litigation.”

Walden v. Fiore, 571 U.S. 277, 284, 134 S.Ct. 1115, 1121 (2014). “In other words,

personal jurisdiction is proper only when the relationship arises ‘out of contacts that the

defendant ... creates with the forum state,’ and not the defendant's contacts with the

plaintiff or third parties.” Int’l Energy Ventures Mgmt., LLC, 813 F.3d at 213 (internal

citations omitted).

Even if minimum contacts exist, the exercise of personal jurisdiction over a non-

resident defendant must not offend “traditional notions of fair play and substantial justice.”

Int’l Shoe Co. v. State of Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158 (1945). To

determine this fundamental fairness issue, courts must consider: “(1) the defendant’s

burden; (2) the forum state’s interests; (3) the plaintiff’s interest in convenient and

effective relief; (4) the judicial system’s interest in efficient resolution of controversies; and

(5) the state’s shared interest in furthering fundamental social policies.” Ruston Gas

Turbines, Inc. v. Donaldson Co., Inc., 9 F.3d 415, 421 (5th Cir. 1993).

II. Analysis

a. ZF ASE LLC

ZF ASE LLC asserts it is not subject to general personal jurisdiction in Louisiana

because it has no continuous and systematic ties with Louisiana. See Record Document

12-1 at 1. Further, ZF ASE LLC asserts it is not subject to specific personal jurisdiction

because they did not “manufacture or design any products at issue in this litigation.” Id.

ZF ASE LLC contends they have “no connection to this incident,” therefore, there is “no

basis for specific jurisdiction.” Id. at 6. In support of these arguments ZF ASE LLC

included an affidavit from a Senior Technical Analyst. See Record Document 12-2.

In response, Plaintiffs contend ZF ASE LLC is subject to general jurisdiction in

Louisiana because it was acquired by ZF Friedrichshafen AG (“ZF”) and ZF has an office

in Louisiana. See Record Document 23 at 4. In support of this contention, Plaintiffs include

screenshots of ZF’s website. See Record Document 23-2. Further, Plaintiffs assert ZF

ASE LLC is subject to specific jurisdiction in Louisiana because ZF ASE LLC placed their

airbag into the “stream of commerce by supplying their products to a major car

manufacture [sic] like Chrysler.” Record Document 23 at 6. As support, Plaintiffs include

the airbag tag from their 2008 Dodge Caravan which includes the name “TRW

Automotive.” Record Document 23-1.

It is abundantly clear the Court lacks general jurisdiction over ZF ASE LLC.

Plaintiffs have failed to present any evidence demonstrating ZF ASE LLC’s ties with

Louisiana are substantial, continual, or systematic. See Goodyear Dunlop Tires

Operations, S.A., 564 U.S. at 919. Rather, Plaintiffs only support for general jurisdiction

is ZF’s location in Louisiana and its registered agent for service of process. See Record

Document 23 at 4. As Defendant correctly notes, the ZF location and agent for service of

process Plaintiffs are referring to is owned by a separate business entity—ZF Marine

Propulsion Systems Miramar, LLC (“ZF Marine”). See id. at 3–4. Plaintiffs made no

allegations that ZF Marine is the alter ego of ZF or of ZF ASE LLC. Thus, this Court will

not impute the contacts of ZF Marine onto either ZF or ZF ASE LLC. See Cannon Mfg.,

Co. v. Cudahy Packing Co., 267 U.S. 333, 336–37, 45 S.Ct. 250, 251 (1925). As Plaintiffs

have failed to demonstrate ZF ASE LLC’s continuous and systematic ties with Louisiana,

this Court lacks general jurisdiction over ZF ASE LLC.

Turning to specific jurisdiction, Plaintiffs assert that because ZF ASE LLC supplied

the airbag to Chrysler in the 2008 Dodge Caravan, ZF ASE LLC should have reasonably

anticipated that the airbag would be placed into the stream of commerce and end up in

Louisiana. See Record Document 23 at 6. However, this argument is without merit as a

Senior Technical Analyst for ZF ASE LLC attests that ZF ASE LLC “did not supply the

Airbag Electronic Control Module, the Occupant Restraint Control Module, the airbag

modules, or any component of the airbag system for the 2008 Dodge Caravan involved

in this lawsuit.” Record Document 12-2 at 2. In an attempt to rebut this evidence, Plaintiffs

attach the alleged airbag tag from the 2008 Dodge Caravan containing the name “TRW

Automotive.” Record Document 23-1.3 This is insufficient evidence to survive a motion to

dismiss pursuant to Rule 12(b)(2).

At this stage in the litigation, “the allegations in the complaint must be taken as

true, unless controverted by affidavits...” Bona Fide Demolition & Recovery, LLC v.

Crosby Constr. Co. of Louisiana, Inc., No. 07-3115, 2010 WL 1936208, at *1 (E.D. La.

May 13, 2010); see also D.J. Invs., Inc. v. Metzeler Motorcycle Tire Agent Gregg, Inc.,

754 F.2d 542, 546 (5th Cir. 1985). Here, ZF ASE LLC controverted Plaintiffs’ allegation

that ZF ASE LLC supplied any part of the airbag for the 2008 Dodge Caravan. See Record

Document 12-2. Plaintiffs failed to credibly rebut that evidence as a mere mention of

3 The picture of the airbag tag is extremely blurry and appears to be written in German. See Record

Document 23-1.

“TRW Automotive” on the airbag tag is not enough to demonstrate ZF ASE LLC supplied

the airbag. This is simply insufficient to rebut the affidavit of an executive within ZF ASE

LLC attesting they did not supply any part of the airbag for the 2008 Dodge Caravan. See

Nationwide Contractor Audit Serv., Inc. v. Nat’l Compliance Mgmt. Serv., Inc., 622 F.

Supp. 2d 276, 282 (W.D. Penn. 2008) (“General averments in an unverified complaint or

response without the support of ‘sworn affidavits or other competent evidence’ are

insufficient to establish jurisdictional facts.”)

Thus, because Plaintiffs have failed to demonstrate any contacts between ZF ASE

LLC and Louisiana, Plaintiffs have failed to establish a prima facie case of specific

jurisdiction over ZF ASE LLC. Accordingly, ZF ASE LLC’s motion to dismiss for lack of

personal jurisdiction is GRANTED and all claims against ZF ASE LLC are DISMISSED

WITHOUT PREJUDICE.

b. ZF PSS

ZF PSS asserts it is not subject to general personal jurisdiction in Louisiana

because it’s not “at home” in Louisiana. See Record Document 15-1 at 6. Further, ZF

PSS contends it is not subject to specific personal jurisdiction in Louisiana because it did

not design, manufacture, or sell the disputed airbag modules in Louisiana. See id. at 7.

Thus, ZF PSS contends it has no connection with Louisiana. See id. In response, Plaintiffs

make near-identical arguments for both general and specific personal jurisdiction as it did

in opposition to ZF ASE LLC. See Record Document 24.

It is again abundantly clear this Court lacks general personal jurisdiction over ZF

PSS. Plaintiffs only evidence for general jurisdiction in Louisiana over ZF PSS is its

connection with ZF. See Record Document 24 at 4. Plaintiffs assert that general

jurisdiction is proper because of ZF Marine’s location and service of process agent

located in Louisiana. See id. Plaintiffs also include a screenshot of ZF’s website listing ZF

PSS as one of ZF’s locations for proof of a connection between ZF and ZF PSS. See

Record Document 24-2.

This is simply insufficient to show ZF PSS’s contacts with Louisiana are

systematic, continuous, or substantial. As noted above, this Court will not impute the

contacts of a business entity onto another without the requisite proof that the business

entity is the “alter ego” of the other. Cannon Mfg., Co., 267 U.S. at 336–37. Merely

attaching a screenshot from ZF’s website listing ZF PSS as a location, without more, is

not enough to demonstrate that ZF PSS is the “alter ego” of ZF or ZF Marine.4 Therefore,

because Plaintiffs failed to demonstrate substantial and continuous contacts between ZF

PSS and Louisiana, ZF PSS is not subject to general jurisdiction in Louisiana.

Turning to specific jurisdiction, Plaintiffs attempt to satisfy minimum contacts

through the “stream of commerce” theory of personal jurisdiction. See Record Document

24 at 6. In support of the stream of commerce argument, Plaintiffs cite a Louisiana

Supreme Court decision—Ruckstuhl v. Owen’s Corning Fiberglas Corporation. See 98-

1126 (La. 4/13/99); 731 So. 2d 881. In that case, the Louisiana Supreme Court permitted

the exercise of specific personal jurisdiction over a foreign defendant manufacturer. See

id. Ruckstuhl, however, is wholly distinguishable from the instant matter because the

4 Some of the factors Louisiana courts consider when determining whether an entity is the alter ego of

another include: common ownership, directors and officers, employees, and offices; unified control;

inadequate capitalization; noncompliance with corporate formalities; centralized accounting; unclear

allocation of profits and losses between corporations; one corporation paying the salaries, expenses, or

losses of another corporation; and undocumented transfers of funds between entities. See Jackson v.

Tanfoglio Giuseppe, S.R.L., 615 F. 3d 579, 587 (5th Cir. 2010).

Court did not rely on the stream of commerce theory to exercise specific personal

jurisdiction. See id. at 889.

Pursuant to Fifth Circuit precedent, minimum contacts is satisfied under the stream

of commerce theory “so long as the court ‘finds that the defendant delivered the product

into the stream of commerce with the expectation that it would be purchased by or used

by consumers in the forum state.’” Ainsworth v. Moffett Eng’g, Ltd., 716 F.3d 174, 177

(5th Cir. 2013) (internal citations omitted). Further, Plaintiffs must clearly show that the

product actually arrived in Louisiana while it was still in the stream of commerce. See id.

A product remains in the stream of commerce until it is purchased by the end consumer.

Seiferth v. Helicopteros Atuneros, Inc., 472 F. 3d 266, 273 (5th Cir. 2006). After such

point, “a consumer’s unilateral decision to take a product to a distant state, without more,

is insufficient to confer personal jurisdiction over the manufacturer or distributor.” Id.

Here, the airbag module left the stream of commerce, at the latest, in California

when the 2008 Dodge Caravan was purchased by the end consumer. See Record

Document 15-3 (CARFAX Vehicle History Report for 2008 Dodge Caravan). ZF PSS did

not manufacture, design, or sell the subject airbag modules in Louisiana. See Record

Document 15-2 (Affidavit of Senior Manager for ZF PSS). Once ZF PSS delivered the

airbag module to the vehicle manufacturer, ZF PSS had no control over the airbag’s

distribution. See id. at 2. Arguably, for ZF PSS’s purposes, the airbag module left the

stream of commerce upon its delivery to the vehicle manufacturer. However, because it

is unclear where the delivery of this specific airbag module was made, the Court will look

to the forum where the vehicle was initially purchased. See Seiferth, 472 F. 3d at 273

(“Once a product has reached the end of the stream and is purchased…”). Thus, the

airbag module exited the stream of commerce in California when it was purchased by the

end consumer.

This Court finds that under any interpretation of the stream of commerce theory

the airbag module left the stream of commerce long before it arrived in Louisiana.

Plaintiffs’ unilateral post-sale act of driving the vehicle into Louisiana is insufficient to

justify the exercise of specific personal jurisdiction. Because the airbag module was no

longer in the stream of commerce, this Court lacks specific personal jurisdiction over ZF

PSS. Accordingly, ZF PSS’s Motion to Dismiss for lack of personal jurisdiction is

GRANTED and all claims against ZF PSS are DISMISSED WITHOUT PREJUDICE.

CONCLUSION

Based on the foregoing reasons, ZF ASE LLC’s Motion to Dismiss (Record

Document 12) is GRANTED and all claims against ZF ASE LLC are hereby DISMISSED

WITHOUT PREJUDICE. Further, ZF PSS’s Motion to Dismiss (Record Document 15) is

also GRANTED and all claims against ZF PSS are hereby DISMISSED WITHOUT

PREJUDICE.

An order consistent with the terms of the instant Memorandum Ruling shall issue

herewith.

THUS DONE AND SIGNED, in Shreveport, Louisiana, this the 3rd day of April,

2020.

a (ble

UNITED STATES DISTRICT COURT

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