94 F.3d 586 (9th Cir. 1996), 94-16368, American Tel. & Tel. Co. v. Compagnie Bruxelles Lambert

Docket Nº:94-16368.
Citation:94 F.3d 586
Party Name:26 Envtl. , 96 Cal. Daily Op. Serv. 6407, 96 Daily Journal D.A.R. 10,543 AMERICAN TELEPHONE & TELEGRAPH COMPANY, Defendant-Third-Party-Plaintiff-Appellant, v. COMPAGNIE BRUXELLES LAMBERT, now known as Groupe Bruxelles Lambert S.A., et al., Third-Party-Defendant-Appellee.
Case Date:August 28, 1996
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit

Page 586

94 F.3d 586 (9th Cir. 1996)

26 Envtl. ,

96 Cal. Daily Op. Serv. 6407,

96 Daily Journal D.A.R. 10,543




COMPAGNIE BRUXELLES LAMBERT, now known as Groupe Bruxelles

Lambert S.A., et al., Third-Party-Defendant-Appellee.

No. 94-16368.

United States Court of Appeals, Ninth Circuit

August 28, 1996

Argued and Submitted Dec. 7, 1995.

Page 587

E. Robert Wright, Thomas, Snell, Jamison, Russell and Asperger, Fresno, California, for defendant-third-party-plaintiff-appellant.

Jeffrey S. Koenig and Bruce G. Merritt, Debevoise & Plimpton, Los Angeles, California, for defendant-third-party-defendant-appellee.

Appeal from the United States District Court for the Eastern District of California, Robert E. Coyle, Chief District Judge, Presiding. D.C. No. CV-92-05202-REC.

Before: BROWNING, CANBY and HALL, Circuit Judges.

JAMES R. BROWNING, Circuit Judge:

AT&T appeals the dismissal of its CERCLA claim against Groupe Bruxelles Lambert, S.A. ("GBL"), the former parent corporation of a company whose operations caused environmental contamination at a site near Bakersfield, California. AT&T contends the district court erred by finding GBL was not

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subject to personal jurisdiction. 1 We have jurisdiction pursuant to 28 U.S.C. § 1291, and affirm.


This appeal stems from CERCLA litigation regarding a metal reclamation facility operated by defendant Keystone Resources, Inc. ("Keystone"). Keystone's Bakersfield facility, which treated and disposed of metal for AT&T, operated on land leased from plaintiff John Chrisman. Defendant GBL, a Belgian holding company, indirectly owned 80 percent of Keystone's stock. AT&T contends this ownership interest, coupled with GBL's alleged "total control" over Keystone, establishes personal jurisdiction over GBL.

GBL has its principal place of business in Brussels, conducts no business in the United States and had no direct involvement in operating the Bakersfield reclamation facility. GBL's wholly-owned U.S. subsidiary, the Lambert Brussels Group ("LBC"), bought 80 percent of Keystone's stock in 1976. 2 Keystone began losing money and GBL directed LBC to sell its Keystone stock. In March 1984 LBC sold its shares back to Keystone for nominal consideration.

In March 1992, Chrisman sued Keystone and AT&T, among others, alleging Keystone's operations had resulted in the release of cadmium, copper, lead, and dioxin and seeking to recover cleanup costs pursuant to CERCLA, 42 U.S.C. §§ 9607 and 9613. AT&T filed a third-party complaint against GBL. Because of GBL's prior ownership of Keystone, AT&T alleged GBL was directly liable under CERCLA § 9607(a) as a former site operator. AT&T also alleged GBL was liable because of its control over Keystone and Keystone's management. 3

After being served with process in Belgium, GBL filed a motion to dismiss for want of personal jurisdiction. The district court granted the motion. This appeal followed.


Personal jurisdiction may be general or specific. AT&T does not contend GBL is subject to general jurisdiction but only to specific jurisdiction, which allows a court to adjudicate claims that arise out of the defendant's contacts with the forum. Wells Fargo & Co. v. Wells Fargo Express Co., 556 F.2d 406, 413 (9th Cir.1977). As the party seeking to invoke federal jurisdiction, AT&T has the burden of establishing its existence. Fields v. Sedgwick Assoc. Risks, Ltd., 796 F.2d 299, 301 (9th Cir.1986); Data Disc, Inc. v. Systems Tech. Assocs., Inc., 557 F.2d 1280, 1285 (9th Cir.1977).

We decide de novo whether jurisdiction was lacking. Ziegler v. Indian River County, 64 F.3d 470, 473 (9th Cir.1995). However, because "the trial court ruled on the issue relying on affidavits and discovery materials without holding an evidentiary hearing, dismissal is appropriate only if the plaintiff has not made a prima facie showing of personal jurisdiction." Fields, 796 F.2d at 301. In determining whether AT&T has met this burden, uncontroverted allegations in AT&T's complaint must be taken as true, and "conflicts between the facts contained in the parties' affidavits must be resolved in [AT&T's] favor for purposes of deciding whether a prima facie case for personal jurisdiction exists." WNS, Inc. v. Farrow, 884

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F.2d 200, 203 (5th Cir.1989) (quoting D.J. Investments v. Metzeler Motorcycle Tire Agent Gregg, 754 F.2d 542, 545-46 (5th Cir.1985)); see Ziegler, 64 F.3d at 474.


GBL submitted affidavits from Rene Van Achter, a GBL employee who sat on Keystone's board of directors, stating that GBL conducted no business in the United States and had no direct involvement in operating Keystone's Bakersfield facility, and that no GBL or LBC employee was involved in Keystone's day-to-day affairs. GBL's indirect ownership of Keystone stock involved no contacts with California; Van Achter attended no meetings in California, and communications with Keystone typically took place in Brussels, New York City, or Pittsburgh.

AT&T offered no evidence that GBL was directly involved with the Bakersfield facility. Instead, it relied on a miscellany of events and internal Keystone decisions, undisputed by GBL, which AT&T contends demonstrate GBL's total control over Keystone and demonstrate that GBL and Keystone had an alter ego relationship sufficient to subject GBL to personal jurisdiction once jurisdiction over Keystone was established. 4


When subject matter jurisdiction is premised on a federal question, a court may exercise specific jurisdiction over a defendant if a rule or statute authorizes it to do so and the exercise of such jurisdiction comports with the constitutional requirements of due process. Go-Video, Inc. v. Akai Elec. Co., 885 F.2d 1406, 1413 (9th Cir.1989).

AT&T argues personal jurisdiction over GBL is authorized by two rules of civil procedure, Rules 4(k)(1)(D) and 4(k)(2), which focus on a defendant's contacts with the nation as a whole. Rule 4(k)(1)(D) allows a court to exercise personal jurisdiction over a defendant when service of summons is "authorized by a statute of the United States." AT&T contends that § 9613(e) of CERCLA permits nationwide service of process and nationwide minimum contacts analysis. See Go-Video, 885 F.2d at 1414 (a defendant's nationwide contacts can be considered when Congress has authorized worldwide service of process). However, § 9613(e) authorizes nationwide service of process only in actions by the United States; it does not apply in private actions. Cf. Omni Capital Int'l v. Rudolf Wolff & Co., 484 U.S. 97, 106, 108 S.Ct. 404, 410-411, 98 L.Ed.2d 415 (1987) (concluding nationwide service of process is not authorized for an implied right of action under the Commodity Exchange Act even though the Act provides nationwide service of process for all other civil actions brought under it).

AT&T argues that personal jurisdiction over GBL is supported by the 1993 revisions to Rule 4(k)(2), 5 which it says "expand[ed]

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the jurisdictional reach of district courts in federal question cases to a national minimum contacts test." As the advisory committee notes explain, however, the new rule authorizes jurisdiction in federal question cases over defendants who have significant nationwide contacts but are not subject to jurisdiction in any state. Fed.R.Civ.P. 4(k)(2) advisory committee's note. GBL had virtually no direct contacts within the United States. 6

Alternately, AT&T contends jurisdiction is supported by Rule 4(k)(1)(A), which authorizes jurisdiction over a non-resident defendant who is subject to jurisdiction in the state where the district court is located. Since California's long-arm statute extends to the limits of due process, see Cal.Code Civ. P. § 410.10; Ziegler, 64 F.3d at 473, we consider whether AT&T has shown that (1) GBL purposefully availed itself of the privilege of conducting activities in California, thereby invoking the benefits and protections of its...

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