Brown v. Geha-Werke GmbH
| Decision Date | 29 September 1999 |
| Docket Number | Civil Action No. 2:98-2605-18. |
| Citation | 69 F.Supp.2d 770 |
| Court | U.S. District Court — District of South Carolina |
| Parties | Laura M. BROWN, Guardian ad Litem for Danielle Paige Brown, a minor, Plaintiff, v. GEHA-WERKE GmbH, Shredex, Inc., Automated Systems, Inc., and the United States of America, Defendants. |
Jack D. Cordray, The Cordray Law Firm, Charleston, SC, William J. Cook, Terry Edward Richardson, Jr., L. Joel Chastain, Ness, Motley, Loadholt, Richardson & Poole, P.A., Barnwell, SC, for Laura M. Brown, plaintiff.
John F. Kuppens, Lisa Woodbury Caldwell, Carl Belden Epps, III, Nelson Mullins Riley and Scarborough LLP, Columbia, SC, for Geha-Werke GmbH, defendant.
Harvey Brockinton, Jr., Brockinton Brockinton and Kerr, Charleston, SC, for Shredex Inc., defendant.
Stephen Edward Darling, Sinkler and Boyd, Charleston, SC, for Automated Systems Inc., defendant.
Joseph P. Griffith, Jr., United States Attorney's Office, Assistant United States Attorney, Charleston, SC, for U.S., defendant.
Mia Lauren Maness, Mark C. Tanenbaum PA, Charleston, SC, for Stephen K. Brown, third-party defendant.
This matter comes before the court on Defendant Geha-Werke's Motion to Dismiss for Lack of Personal Jurisdiction.
1. This products liability case arises out of an injury the infant Plaintiff received when her father, who worked for the United States Navy, took her to work and let her feed paper into a paper shredder located in his office.
2. The paper shredder was manufactured by Defendant Geha-Werke, a corporation organized under the laws of Germany with its principal place of business in Garbsen, Germany. (Brandes Aff. ¶ 2)1 3. Defendant Geha-Werke's manufacturing facility is located in Germany, and it has no manufacturing facility or corporate offices in the United States. (Brandes Aff. ¶ 2)
4. Defendant Geha-Werke transacts no business in South Carolina. (Brandes Aff. ¶ 3)
5. No agents or employees of Defendant Geha-Werke are located in this State. (Brandes Aff. ¶ 4)
6. Since 1991,2 only two agents of Defendant Geha-Werke have visited the United States. Peter Brandes, the company's export manager, visited New York fifteen times on business, and he visited California once. Heinz Krause, Defendant Geha-Werke's general manager, visited New York eight times on business, and he attended exhibitions in Dallas, Texas, and Las Vegas, Nevada. No agent of Defendant Geha-Werke has ever visited South Carolina. (Pl.Ex. 8, Interrogatory Answer No. 4)
7. Defendant Geha-Werke owns no property in this State. (Brandes Aff. ¶ 5)
8. Defendant Geha-Werke does not advertise in South Carolina. (Brandes Aff. ¶ 6)
9. Defendant Geha-Werke is not licensed to do business in South Carolina, nor does it hold itself out as doing business in this State. (Brandes Aff. ¶ 6)
10. Defendant Geha-Werke has not tried to develop a market in this State or solicit customers or business in South Carolina. (Brandes Aff. ¶ 7)
11. Defendant Geha-Werke does not provide any services or advice to customers located in this State, and it maintains no customer relations network for customers in South Carolina. (Brandes Aff. ¶ 7)
12. Defendant Shredex, Incorporated, a distributor of shredders, initiated the idea of doing business with Defendant Geha-Werke. (Brandes Aff. ¶ 8)
13. Pursuant to an agreement between Defendant Shredex and Defendant Geha-Werke, Shredex became the sole and exclusive distributor of the Geha-Werke shredders marketed and sold in the United States under the brand name and trademark, "Shredex." (Pl.Ex.1)3
14. All advertising, marketing, and distribution of the shredders was performed by Shredex. (Brandes Aff. ¶ 8)
15. Under the agreement between Defendant Geha-Werke and Defendant Shredex, the distributor agreed to send to the manufacturer "reports at regular intervals on market conditions, activities and prices of the competition, changes in economic legislation and on other matters which a sole distributor is obliged to observe and to report on." (Pl.Ex.1)
16. As a result of the Geha-Shredex agreement, Defendant Geha-Werke has exported 113,543 shredders to Defendant Shredex and its distributors in the United States since 1983. (Pl.Ex. 8, Interrogatory Answer No. 2)
17. Defendant Shredex marketed the shredders manufactured and exported by Defendant Geha-Werke through a number of distributors and dealers throughout the United States, including Defendant Automated Systems, Incorporated. (Pl.Ex.2)
18. Defendant Automated Systems was a GSA contractor that sold Shredex high-security shredders to the United States government and its agencies, including the United States Navy. (Pl.Ex.2)
19. Defendant Automated Systems dealt only with Defendant Shredex; it had nothing to do with Defendant Geha-Werke.
20. The shredders Defendant Geha-Werke manufactures are delivered to Defendant Shredex F.O.B. at the seaport Bremerhaven, Germany. (Def. Ex. A to Def.'s Reply Brief, dated Feb. 23, 1999)
21. The shredders are then shipped to ports in the United States in forty-foot containers. (Pl.Ex. 3, Dennis Horton depo. p. 52 ll. 7-22; p. 53 l. 1; Michael J. Falco depo. p. 17 ll. 18-22)
22. The contents of the containers are then delivered to Defendant Automated Systems' warehouse in Springfield, Virginia.
23. Inside the sealed containers were the shredders themselves, operating instructions, and other materials from Defendant Geha-Werke, although it was all Defendant Shredex information.
24. The shredder involved in this case was ordered by telephone by the Naval Weapons Station in Charleston, South Carolina, on April 17, 1986, and shipped there by Automated Systems via common carrier on the same day. (Pl.Ex.7)
25. The incident involving this shredder occurred on October 7, 1995, at the Charleston Naval Base.
On September 4, 1998, Plaintiff filed this suit against the above-named Defendants, alleging causes of action under the theories of negligence, breach of warranty, strict liability, and breach of post-manufacture/sale duty. On December 1, 1998, Defendant Geha-Werke filed a Motion to Dismiss for Lack of Personal Jurisdiction. The court subsequently heard and granted Defendant's motion on March 3, 1999. This Order simply outlines the court's analysis more fully than as dictated on the record at the hearing.
The Fourth Circuit has ruled that "[w]hen a court's personal jurisdiction is properly challenged by a Rule 12(b)(2) motion, the jurisdictional question thus raised is one for the judge, with the burden on the plaintiff ultimately to prove the existence of a ground for jurisdiction by a preponderance of the evidence." Combs v. Bakker, 886 F.2d 673, 676 (4th Cir.1989) (emphasis added). However, at the pretrial stage, Plaintiff "need only make a prima facie showing by pleadings and affidavits." Allen v. Columbia Fin. Management, Ltd., 297 S.C. 481, 377 S.E.2d 352, 354 (1988); see Combs, 886 F.2d at 676; Umbro U.S.A. v. Goner, 825 F.Supp. 738, 739 (D.S.C.1993). Indeed, the Fourth Circuit has held that when a district court decides a pretrial personal jurisdiction dismissal motion without an evidentiary hearing, Plaintiffs need only prove a prima facie case of personal jurisdiction. See Mylan Labs., Inc. v. Akzo, N.V., 2 F.3d 56, 60 (4th Cir.1993). Although this court decided the issue of personal jurisdiction without an evidentiary hearing, it did not do so on the pleadings and affidavits alone. Instead, the parties have engaged in jurisdictional discovery and offered evidence beyond the pleadings and affidavits. Consequently, the jurisdictional information before the court is more like that presented at an evidentiary hearing and less like the jurisdictional allegations of a complaint. As such, Plaintiff must establish personal jurisdiction by a preponderance of the evidence.4 See Volkswagenwerk Aktiengesellschaft v. Beech Aircraft Corp., 751 F.2d 117, 120 (2d Cir.1984) ( ); Hvide Marine Int'l, Inc. v. Employers Ins. of Wausau, 724 F.Supp. 180, 182 (S.D.N.Y.1989) ().
This court finds that it cannot assert specific in personam jurisdiction over Defendant Geha-Werke. "Specific jurisdiction involves the exercise of personal jurisdiction over the defendant in an action which arises out of the defendant's contact with the forum." Federal Ins. Co. v. Lake Shore, Inc., 886 F.2d 654, 660 (4th Cir. 1989). When evaluating a challenge to an assertion of specific in personam jurisdiction obtained under a state's long arm statute, this court engages in a two-step analysis. See, e.g., Ellicott Mach. Corp. v. John Holland Party Ltd., 995 F.2d 474, 477 (4th Cir.1993). First, the court must determine whether the long-arm statute authorizes the exercise of jurisdiction under the facts presented. See id. Second, if the statute so authorizes, the court must then determine whether the statutory assertion of personal jurisdiction is consistent with due process. See id.
In order for this court to exercise personal jurisdiction over a non-resident defendant, the defendant's conduct must fall within one of the long-arm statute's enumerated categories of conduct. See S.C.Code Ann. § 36-2-803 (1976). Section 36-2-803 provides, in pertinent part,5 that
(1) [a] court may exercise...
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