Weyerhaeuser Co. v. Keating Fibre Intern., Inc.
| Decision Date | 21 February 2006 |
| Docket Number | No. C05-1986JLR.,C05-1986JLR. |
| Citation | 416 F.Supp.2d 1041 |
| Parties | WEYERHAEUSER COMPANY, INC., Plaintiff, v. KEATING FIBRE INTERNATIONAL, INC., Defendant. |
| Court | U.S. District Court — Western District of Washington |
David R. Goodnight, Maren Roxanne Norton, Stoel Rives, Seattle, WA, for Plaintiff.
Kelly P. Corr, Molly Aneesa Malouf, Corr Cronin Michelson Baumgardner & Preece, Seattle, WA, for Defendant.
This matter comes before the court on a Fed.R.Civ.P. 12(b)(2) motion (Dkt.# 3) from Defendant Keating Fibre International, Inc. ("Keating") to dismiss this action for lack of personal jurisdiction or, alternatively, to stay the action. The court has considered the parties' briefing and accompanying declarations. For the reasons stated below, the court DENIES the motion.
Keating is a Delaware corporation in the business of, among other things, distributing and brokering containerboard and linerboard for use in the corrugated box industry. Weyerhaeuser Company, Inc. ("Weyerhaeuser") is a Washington corporation in the business of, among other things, manufacturing and selling containerboard and linerboard for use in the corrugated box industry.
Keating purchased prime linerboard from Weyerhaeuser for sale to customers in Mexico. In April 2005 Weyerhaeuser notified Keating that it was terminating the relationship between them. In August 2005, Weyerhaeuser discontinued the relationship although it agreed to accept new orders from Keating during a transition period.
A dispute has arisen between the parties regarding their business relationship. Weyerhaeuser filed the instant action in Washington (the "Washington action") on November 30, 2005. Keating filed a complaint against Weyerhaeuser, based on the same business relationship between the parties, in the Eastern District of Pennsylvania on December 13, 2005 (the "Pennsylvania action"). Keating seeks to dismiss the Washington action for lack of personal jurisdiction or, in the alternative, to stay the Washington action in favor of the Pennsylvania action.
Weyerhaeuser must make a prima facie showing of personal jurisdiction to survive Keating's motion to dismiss. Harris Rutsky & Co. Ins. Servs., Inc. v. Bell & Clements Ltd., 328 F.3d 1122, 1128-29 (9th Cir.2003). Weyerhaeuser must provide evidence that, if believed, would support the court's exercise of jurisdiction over Keating. Id. at 1129. The court need not accept Plaintiff's bare allegations if Keating controverts them with evidence. See AT & T Co. v. Compagnie Bruxelles Lambert, 94 F.3d 586, 588 (9th Cir.1996). If both parties provide evidence supporting different versions of a fact, however, the court must resolve competing inferences in Weyerhaeuser's favor. Harris Rutsky, 328 F.3d at 1129.1
Where no applicable federal statute addresses the issue, a court's personal jurisdiction analysis begins with the "long-arm" statute of the state in which the court sits. Terracom v. Valley Nat. Bank, 49 F.3d 555, 559 (9th Cir.1995). Washington's long-arm statute extends the court's personal jurisdiction to the broadest reach that the United States Constitution permits. Shute v. Carnival Cruise Lines, 113 Wash.2d 763, 783 P.2d 78, 82 (1989). The court must therefore determine whether exercising jurisdiction over Keating comports with federal due process. Glencore Grain Rotterdam B.V. v. Shivnath Rai Harnarain Co., 284 F.3d 1114, 1123 (9th Cir.2002).
A court can exercise its power over a non-resident defendant (absent the defendant's consent) only if it has general or specific jurisdiction. Bancroft & Masters, Inc. v. Augusta Nat'l, Inc., 223 F.3d 1082, 1086 (9th Cir.2000). Where a defendant has "substantial" or "continuous and systematic" contacts with the forum state, it is subject to general jurisdiction, and can be haled into court on any action, even one unrelated to its contacts. Id. If a defendant is not subject to general jurisdiction, it may be subject to specific jurisdiction if the action upon which it is sued arises from its contacts within the forum state. Id. In either case, the critical factor in determining personal jurisdiction is the extent of the defendant's contacts with the forum state. The court therefore must examine Keating's contacts with Washington to determine if they support the exercise of either general or specific jurisdiction.
A plaintiff asserting general jurisdiction must meet an "exacting standard." Arnold Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 804 (9th Cir. 2004). A defendant is not subject to general jurisdiction unless its contacts are so "substantial or continuous and systematic" that they "approximate physical presence" in the forum state. Bancroft & Masters, 223 F.3d at 1086. The Ninth Circuit "regularly [has] declined to find general jurisdiction even where the [defendant's] contacts were quite extensive." Amoco Egypt Oil Co. v. Leonis Nay. Co., Inc., 1 F.3d 848, 851 n. 3 (9th Cir.1993).2
General jurisdiction requires a much more substantial connection to the forum than does specific jurisdiction. Ballard v. Savage, 65 F.3d 1495, 1500 (9th Cir.1995). A court must consider "all of the defendant's activities that impact the state, including whether the defendant makes sales, solicits or engages in business, serves the state's markets, designates an agent for service of process, holds a license, has employees, or is incorporated there." Hirsch v. Blue Cross, Blue Shield of Kansas City, 800 F.2d 1474, 1478 (9th Cir.1986). A mere showing that a defendant has systematic business contacts with the forum, however, is insufficient. Bancroft & Masters, 223 F.3d at 1086. A plaintiff must show that the defendant's activities transcend doing business "with" the forum state such that it is fair to say that it is actually doing business "in" the forum state. Id.; see also Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 418, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984) () It is not enough to show that the defendant has "stepped through the door" of the forum through ongoing business contacts; the plaintiff must show that the defendant "has sat down and made itself at home." Glencore Grain, 284 F.3d at 1125.
In response to Keating's arguments regarding a lack of general jurisdiction over it, Weyerhaeuser appears to concede that general jurisdiction exists, and the court will not deal with this contention further.
The Ninth Circuit applies a three-part test to determine specific jurisdiction. First, the nonresident defendant must "do some act or consummate some transaction with the forum or perform some act by which he purposefully avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws[.]" Data Disc. Inc. v. Sys. Tech. Assocs., Inc., 557 F.2d 1280, 1287 (9th Cir.1977). Second, the plaintiff's claim must "arise[ ] out of or result[ ] from the defendant's forum-related activities...." Id. Third, the "[e]xercise of jurisdiction must be reasonable." Id. If the plaintiff meets his burden on the first two parts of the test, the burden shifts to the defendant to satisfy the third part by presenting a "compelling case" that the exercise of jurisdiction is unreasonable. Schwarzenegger, 374 F.3d at 802 (citation omitted).
Under the first prong of the three-part specific jurisdiction test, Weyerhaeuser must establish that Keating either purposefully availed itself of the privilege of conducting activities in Washington, or purposefully directed its activities towards Washington. The Ninth Circuit uses the phrase "purposeful availment" in shorthand fashion to include both purposeful availment and purposeful direction, see, e.g., Harris Rutsky, 328 F.3d at 1130 (citing Haisten v. Grass Valley Med. Reimbursement Fund Ltd., 784 F.2d 1392, 1397 (9th Cir.1986)), but availment and direction are two distinct concepts. A purposeful availment analysis is most often used in suits sounding in contract. See, e.g., Doe v. Unocal Corp., 248 F.3d 915, 924 (9th Cir.2001).
As explained in Sinatra v. National Enquirer, Inc., 854 F.2d 1191, 1195 (9th Cir.1988):
Purposeful availment analysis examines whether the defendant's contacts with the forum are attributable to his own actions or solely the actions of the plaintiff. In order to have purposefully availed oneself of conducting activities in the forum, the defendant must have performed some type of affirmative conduct which allows or promotes the transaction of business within the forum state.
Id. at 1195 (citations omitted). The Supreme Court has explained: "This purposeful availment requirement ensures that a defendant will not be haled into a jurisdiction solely as a result of random, fortuitous, or attenuated contacts, or of the unilateral activity of another party or third person." Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985) (citations and internal quotations omitted). The Ninth Circuit has further explained that "the purposeful availment analysis turns upon whether the defendant's contacts are attributable to actions by the defendant himself, or conversely to the unilateral activity of another party." Roth v. Garcia Marquez, 942 F.2d 617, 621 (9th Cir.1991) (quoting Hirsch, 800 F.2d at 1478).
In this case, Keating representatives made trips to Washington to discuss sales, marketing And other aspects of its commercial relationship with Weyerhaeuser. As such, Keating has purposefully availed itself of Washington as a forum and has not been haled into Washington by actions attributable to Weyerhaeuser or the unilateral activity of a third party.
The court is mindful of Keating's argument that the object of the parties' commercial...
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