566 F.3d 94 (3rd Cir. 2009), 08-2690, D'Jamoos ex rel. Estate of Weingeroff v. Pilatus Aircraft Ltd.

Docket Nº:08-2690.
Citation:566 F.3d 94
Opinion Judge:GREENBERG, Circuit Judge.
Party Name:Theresa D'JAMOOS, As Executrix of the ESTATE OF Dawn Elizabeth WEINGEROFF; Frederick L. Weingeroff, Administrator of the Estate of Leland C. Weingeroff & Executor of the Estate of Gregg C. Weingeroff; Stanley J. Wachtenheim, Executor of the Estate of Jeffrey M. Jacober; Michael A. Jacober; David S. Jacober, Co-Executors of the Estate of Karen L. Ja
Attorney:Anthony Tarricone, Joseph P. Musacchio, Kreindler & Kreindler LLP, Boston, MA, Center for Constitutional Litigation, P.C., Washington, DC, Sol H. Weiss, Anapol, Schwartz, Weiss, Cohan, Feldman & Smalley, PC, Philadelphia, PA, for Plaintiffs-Appellants. Bruce J. Berman, (argued), McDermott Will & ...
Judge Panel:Before: BARRY and GREENBERG, Circuit Judges, and ACKERMAN, District Judge.[*]
Case Date:May 14, 2009
Court:United States Courts of Appeals, Court of Appeals for the Third Circuit
 
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566 F.3d 94 (3rd Cir. 2009)

Theresa D'JAMOOS, As Executrix of the ESTATE OF Dawn Elizabeth WEINGEROFF; Frederick L. Weingeroff, Administrator of the Estate of Leland C. Weingeroff & Executor of the Estate of Gregg C. Weingeroff; Stanley J. Wachtenheim, Executor of the Estate of Jeffrey M. Jacober; Michael A. Jacober; David S. Jacober, Co-Executors of the Estate of Karen L. Jacober & Co-Administrators of the Estate of Eric B. Jacober

v.

PILATUS AIRCRAFT LTD.; Pilatus Flugzeugweke Aktiengesellschaft; Rosemount Aerospace, Inc.; Revue Thommen AC; EMCA; Goodrich Avionics Systems, Inc.; L-3 Communications Corporation; Goodrich Corporation

Theresa D'Jamoos; Frederick L. Weingeroff; Stanley J. Wachtenheim; Michael A. Jacober; David S. Jacober, Appellants.

No. 08-2690.

United States Court of Appeals, Third Circuit.

May 14, 2009

Argued March 5, 2009.

As Amended June 24, 2009.

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[Copyrighted Material Omitted]

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Anthony Tarricone, Joseph P. Musacchio, Kreindler & Kreindler LLP, Boston, MA, Center for Constitutional Litigation, P.C., Washington, DC, Sol H. Weiss, Anapol, Schwartz, Weiss, Cohan, Feldman & Smalley, PC, Philadelphia, PA, for Plaintiffs-Appellants.

Bruce J. Berman, (argued), McDermott Will & Emery LLP, Miami, FL, Jeffrey Baltruzak, Jeffrey A. Rossman, McDermott Will & Emery LLP, Chicago, IL, J. Bruce McKissock, Marshall, Dennehey, Warner, Coleman & Goggin, Philadelphia, PA, for Defendant-Appellee Pilatus Aircraft Ltd.

Before: BARRY and GREENBERG, Circuit Judges, and ACKERMAN, District Judge.[*]

OPINION

GREENBERG, Circuit Judge.

I. INTRODUCTION

This matter comes on before this Court on an appeal from an order of the United States District Court for the Eastern District of Pennsylvania, entered on April 30, 2008, and made final by an order entered on May 27, 2008: (1) granting a motion by appellee Pilatus Aircraft Ltd. (" Pilatus" ) 1 to dismiss it as a defendant for lack of personal jurisdiction, and (2) denying appellants' motion to transfer the action to the United States District Court for the District of Colorado pursuant to 28 U.S.C. § 1631. D'Jamoos v. Pilatus Aircraft Ltd., No. 07-1153, 2008 U.S. Dist. LEXIS 35181, 2008 WL 1902193 (E.D.Pa. Apr. 30, 2008). For the reasons that follow, we will affirm the order of the District Court to the extent that it held that it did not have jurisdiction over Pilatus, but will vacate the order of the District Court to the extent that it denied the motion to transfer the action to Colorado and will remand the case to the District Court for further proceedings.

II. FACTS AND PROCEDURAL HISTORY

This action arose from tragic events on March 26, 2005, when a PC-12 turboprop aircraft that Pilatus had manufactured

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crashed while attempting to land in State College, Pennsylvania. The plane, piloted by Jeffrey Jacober, was carrying five passengers, and all six people on the plane were killed. At the time of the crash, the plane had been making a planned stop in Pennsylvania on its way from Florida to Rhode Island, where the six persons lived. This action, among others, followed.2 The plaintiffs, now the appellants, are Rhode Island citizens and are the representatives of the decedents' Rhode Island estates.

A. The Manufacture and Distribution of PC-12s

Pilatus is a Swiss company based in Stans, Switzerland, where it has designed and manufactured single-engine aircraft since 1939. Pilatus makes planes for both the general aviation and military training aircraft markets. The PC-12 is a single-engine turboprop aircraft designed for the civilian, general aviation market.

The majority of Pilatus's PC-12s ultimately are sold in the United States. In fact, Pilatus's Annual Report 2006 (" Annual Report" ) describes the United States as " unrivalled" among purchasers of PC-12s, having taken delivery of nearly two-thirds of the 670 PC-12s that Pilatus had built to date. App. at 103. Pilatus makes all sales of the PC-12 in the United States through its Colorado-based United States subsidiary, Pilatus Business Aircraft, Ltd. (" PilBAL" ), which is responsible for all PC-12 sales in North and South America. PilBAL buys the planes from Pilatus, then sells them to contracted independent dealers, which, in turn, market and sell the PC-12s to retail customers in their respective geographic areas. Pilatus is not involved directly in the United States in the sale of its planes, as PilBAL and its independent dealers are responsible for the advertising and marketing of the PC-12s in this country. Moreover, Pilatus does not perform any maintenance in the United States on the planes it has manufactured. Pilatus asserts that it generally is not aware of when and where new PC-12s are sold to retail buyers after PilBAL purchases the planes, and that it generally is not aware of any subsequent resales of its planes.3 Similarly, PilBAL claims that it generally is not aware of when and where the independent dealers ultimately sell the planes in their multi-state territories.

To obtain Federal Aviation Administration (" FAA" ) certification allowing PC-12 planes to be registered and flown in the United States, Pilatus equips its PC-12s with a stick-pusher system intended to prevent the planes from stalling and entering a spin, which would create a significant risk of crashing. The turboprop aircraft at issue in this case, Pilatus PC-12 S/N 299, included such a system. Appellants allege that the subject aircraft crashed because of the failure of its stick-pusher system and/or other components, as well

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as systems manufactured by other defendants not involved in this appeal.

In 1999, Pilatus manufactured the aircraft involved in the Pennsylvania crash at its Stans, Switzerland, facilities. Thereafter Pilatus sold the aircraft to a French buyer. Its owner then resold the plane to a Swiss company (not Pilatus), which resold it to a Massachusetts company. The Massachusetts company brought the plane to the United States in the spring of 2003 and sold it to J2W Aviation, LLC, a Rhode Island company which based the aircraft in Rhode Island. Pilatus was not involved in any of the aircraft's resales, and its only contact with the plane after its original sale was some maintenance of it in Switzerland at the request of its then owners. Pilatus, however, had no contact with the aircraft after it left Europe.

B. Contacts with Pennsylvania

Pilatus contends that appellants cannot sue it in Pennsylvania because Pilatus has had almost no contacts within Pennsylvania. In this regard, it is undisputed that Pilatus never has had offices, mailing addresses, telephone numbers, facilities, employees, officers, directors, owners, shareholders, agents, assets, investments, bank accounts, or subsidiaries in Pennsylvania; Pilatus never has owned, leased, or used real property in Pennsylvania; and Pilatus never has registered to do business in Pennsylvania. In the last five years, Pilatus has not sold any aircraft to purchasers in Pennsylvania or shipped anything directly to persons or entities in Pennsylvania.4 Pilatus has not advertised or marketed its products in Pennsylvania and did not design the PC-12 for the Pennsylvania market specifically, although it did target the United States market generally by designing the plane to ensure its compliance with FAA requirements. Within the five years preceding this litigation, however, Pilatus did have some direct contacts within Pennsylvania. In the early 2000s, Pilatus sent two employees to view displays at a potential supplier in Pennsylvania that Pilatus never used. Moreover, Pilatus purchased $1,030,139 in products, equipment, or services 5 from suppliers in Pennsylvania, an amount that represented less than one percent of Pilatus's total annual purchases for an approximately five-year period.

PilBAL also had some contacts within Pennsylvania during this time. From 2003 to 2007, PilBAL sold $600,000 worth of spare airplane parts to its independent dealer serving Pennsylvania, a Maryland company called SkyTech, Inc. At SkyTech's request, PilBAL shipped parts directly to Pennsylvania customers. In 2005, PilBAL paid $12,705.80 to place an advertisement in five or six 6 issues of Police and Security News, a national publication with offices in Quakertown, Pennsylvania.

The record does not contain any evidence of sales of PC-12s in Pennsylvania

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by Pilatus, PilBAL, or SkyTech. Nevertheless, an owner-operator list that Pilatus maintains for warranty purposes shows that some of its planes have ended up in Pennsylvania and some may have been resold there. At the time of Pilatus's motion to dismiss, four PC-12s and four other Pilatus planes were based in Pennsylvania,7 but the record does not show how the four PC-12s reached Pennsylvania.

C. Contacts with Colorado

Although Pilatus itself 8 is not registered to do business in Colorado, it conducts nearly $200 million 9 in annual business there in transactions with PilBAL, its wholly-owned, Colorado-based subsidiary, which it founded specifically to provide " completions, marketing, sales, and service for Pilatus aircraft in North and South America." App. at 83. Pilatus's relationship with Colorado is highly profitable, and in 2005 and 2006, approximately half of Pilatus's revenue originated with PilBAL. According to Pilatus's Annual Report, PilBAL, " [a]s in past years ... made the biggest contribution to the total annual sales figures" of the company, selling 61 PC-12s, or over two-thirds of the 90 such aircraft sold in 2006, while at the same time receiving a record number of orders for new aircraft as well. Id. at 105. Of the 61 aircraft PilBAL sold, 54 were sold in the United States. The report...

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