Carmona v. Leo Ship Mgmt., Inc.

• Citation: 924 F.3d 190
• Decision Date: 10 May 2019
• Docket Number: No. 18-20248,18-20248
• Parties: Jose CARMONA, Plaintiff–Appellant, v. LEO SHIP MANAGEMENT, INCORPORATED, Defendant–Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (5th Circuit)

924 F.3d 190

Jose CARMONA, Plaintiff–Appellant,
v.
LEO SHIP MANAGEMENT, INCORPORATED, Defendant–Appellee.

No. 18-20248

United States Court of Appeals, Fifth Circuit.

FILED May 10, 2019

Kyle Andrew Lawrence, Chad Flores, Esq., Beck Redden, L.L.P., Suite 4500, 1221 McKinney Street, 1 Houston Center, Houston, TX 77010, for Plaintiff - Appellant

Jadd Fitzgerald Masso, Esq., Clark Hill Strasburger, Suite 6000, 901 Main Street, Bank of America Plaza, Dallas, TX 75202, for Defendant - Appellee

Before HIGGINBOTHAM, SMITH, and HIGGINSON, Circuit Judges.

JERRY E. SMITH, Circuit Judge:

Jose Carmona was injured while unloading cargo from a vessel docked outside Houston. He sued Leo Ship Management, Inc. ("LSM"), a foreign corporation that managed the ship. Noting that LSM had no control over the ship’s ports of call, the district court dismissed for want of personal jurisdiction, holding that the company did not purposely avail itself of the privilege of conducting activities in Texas. We affirm in part, vacate in part, and remand.

I.

As a stevedore, Carmona was tasked with unloading cargo from the M/V Komatsushima Star in April 2014. While he was rigging a bundle of pipes in the ship’s hold, the pipes fell and injured his ankle and lower leg.

LSM is a Philippine corporation with its principal place of business in Manila. None of its employees, officers, shareholders, or directors has ever resided in Texas, and the company does not own or rent property in the state. LSM solicits no business in Texas and has never contracted with a Texas resident to render performance there.

In 2009, LSM contracted with the owners of the M/V Komatsushima Star to serve as the ship manager. In that capacity, LSM supplied and supervised the crew and arranged for necessary repairs and maintenance to ensure compliance with the laws "of the places where [the vessel] trades." The contract was freely terminable with two months’ notice. Under the agreement, LSM did not have an ownership interest in the ship and could not direct where it traveled, what it carried, or for whom it worked. Rather, the charterer or subcharterer possessed the sole authority to set the ship’s course. Nonetheless, the agreement required the ship’s owners and LSM "to maintain close communication with each other and [to] share relevant information regarding [the] ship’s schedule" and "port information." In fact, LSM had advance notice that the ship would be docking in Texas to discharge the pipes.

Although a third party had loaded the pipes aboard the ship outside the United States, Carmona sued LSM in state court, claiming negligence under general maritime law and the Longshore and Harbor Workers’ Compensation Act ("LHWCA"). See 33 U.S.C. §§ 905(b), 933. Specifically,

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he alleged that LSM breached its duty to (1) stow the pipes properly; (2) minimize hazards associated with falling pipes; (3) take precautions to protect workers; (4) provide a safe work environment; (5) turn over the vessel in a safe condition for discharging cargo; (6) warn of hidden dangers; and (7) intervene. After removing to federal court, LSM moved to dismiss for lack of personal jurisdiction. See FED. R. CIV. P. 12(b)(2).

The district court granted the motion, finding that LSM did not purposely avail itself of the benefits and protections of Texas. The court reasoned that because LSM had no control over the itinerary, any contact with the state was "merely fortuitous or random." This appeal followed.

II.

We review a ruling on personal jurisdiction de novo . Sangha v. Navig8 ShipManagement Private Ltd. , 882 F.3d 96, 101 (5th Cir. 2018). Where, as here, the district court dismissed "without conducting an evidentiary hearing, the plaintiff bears the burden of establishing only a prima facie case of personal jurisdiction." Id. "We accept the plaintiff’s uncontroverted, nonconclusional factual allegations as true and resolve all controverted allegations in the plaintiff’s favor." Panda Brandywine Corp. v. Potomac Elec. Power Co. , 253 F.3d 865, 868 (5th Cir. 2001) (per curiam).

There is personal jurisdiction if the forum state’s long-arm statute extends to the nonresident defendant and the exercise of jurisdiction comports with due process. Sangha , 882 F.3d at 101. Because Texas’s long-arm statute is coextensive with the Due Process Clause of the Fourteenth Amendment, the two inquiries merge. Id. Though "[p]ersonal jurisdiction can be general or specific," this case implicates only the latter. See Seiferth v. Helicopteros Atuneros, Inc. , 472 F.3d 266, 271 (5th Cir. 2006). In evaluating whether due process permits the exercise of specific jurisdiction, we consider

(1) whether the defendant has minimum contacts with the forum state, i.e., whether it purposely directed its activities toward the forum state or purposefully availed itself of the privileges of conducting activities there; (2) whether the plaintiff’s cause of action arises out of or results from the defendant’s forum-related contacts; and (3) whether the exercise of personal jurisdiction is fair and reasonable.

Id. (citation omitted). If the plaintiff establishes the first two prongs, the burden shifts to the defendant to make a "compelling case" that the assertion of jurisdiction is not fair or reasonable.¹

A.

For there to be minimum contacts, a defendant must have "purposefully availed himself of the benefits and protections of the forum state"² "such that he should reasonably anticipate being haled into court there."³ That requirement is the "constitutional touchstone" of personal jurisdiction. Burger King , 471 U.S. at 474, 105 S.Ct. 2174. It "ensures that a defendant will not be haled into a jurisdiction

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solely as a result of random, fortuitous, or attenuated contacts, or of the unilateral activity of another party or a third person." Id. at 475, 105 S.Ct. 2174 (internal quotation marks and citations omitted). That is, the plaintiff cannot supply "the only link between the defendant and the forum." Walden v. Fiore , 571 U.S. 277, 285, 134 S.Ct. 1115, 188 L.Ed.2d 12 (2014). Rather, jurisdiction is proper only where the "defendant himself " made deliberate contact with the forum. Id. at 284, 134 S.Ct. 1115 (quoting Burger King , 471 U.S. at 475, 105 S.Ct. 2174 ).

The parties do not dispute that LSM made contacts with the forum when the vessel, containing its employees, docked outside Houston.⁴ Instead, they disagree as to (1) whether a defendant’s contacts with a forum and the purposefulness of those contacts are independent inquiries and (2) if so, whether LSM’s presence in Texas was purposeful.

1.

According to Carmona, knowing and voluntary entry into a forum state, coupled with commission of a tort inside that state, is sufficient to support specific jurisdiction, irrespective of whether the defendant purposely availed itself of the privilege of conducting activities there. Carmona posits that purposeful availment is analytically useful only in "effects" cases in which a defendant’s out-of-state conduct inflicted injury within the forum. He suggests that in such cases, purposeful availment operates as a "conceptual tool" for determining whether the defendant’s contacts with the forum "are such that he should reasonably anticipate" litigation there. Burger King , 471 U.S. at 474, 105 S.Ct. 2174 (quoting World-Wide Volkswagen, 444 U.S. at 297, 100 S.Ct. 580 ). But Carmona urges that where, as here, the tortious act both occurred and caused injury within the forum, the court need not independently consider whether the conduct was purposefully directed at the forum state or whether the defendant purposefully availed itself of the forum state’s protections.

In most cases, the defendant’s commission of a tort while physically present in a state will readily confer specific jurisdiction.⁵ "Generally, the commission of an intentional tort in a forum state is a purposeful act that will satisfy the purposeful availment prong ...." 16 JAMES WM. MOORE ET AL. , MOORE’S FEDERAL PRACTICE § 108.42[3][a], at 108-70 (3d ed. 2019). Nonetheless, while recognizing that a defendant’s physical entry into a forum "is certainly a relevant contact,"⁶ the Supreme Court has never held that such presence is dispositive in the "minimum contacts" analysis.⁷ Instead, the Court has stressed that "where the defendant deliberately has engaged in significant activities within a State, ... he manifestly has availed himself of the privilege of conducting business there." Id. at 475–76, 105 S.Ct. 2174 (emphasis added) (cleaned up).

Purposeful availment is a constitutional prerequisite for jurisdiction, regardless of where the tortious conduct occurred. In

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Elkhart Engineering Corp. v. Dornier Werke , 343 F.2d 861 (5th Cir. 1965), the plaintiff sued a German corporation for crashing his plane during a demonstration in Alabama. Beyond the requirement that the defendant have "minimum contacts ... with the forum," we recognized "the additional element that in every case ... there must be ‘some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.’ " I...