Dalton v. R & W Marine, Inc.

• Decision Date: 13 April 1990
• Docket Number: No. 89-3681,89-3681
• Citation: 897 F.2d 1359
• Parties: Jerry DALTON, Plaintiff-Appellant, v. R & W MARINE, INC. (Hartley Marine Corp., d/b/a R & W Marine, Inc.), et al., Defendants-Appellees. Summary Calendar.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 1359

897 F.2d 1359

1993 A.M.C. 1214

Jerry DALTON, Plaintiff-Appellant, v. R & W MARINE, INC. (Hartley Marine Corp., d/b/a R & W Marine, Inc.), et al., Defendants-Appellees.

No. 89-3681

Summary Calendar.

United States Court of Appeals Fifth Circuit.

April 13, 1990.

Elizabeth A. Hammant, Lamothe & Hamilton, Frank E. Lamothe, III, New Orleans, La., for plaintiff-appellant.

James F. Shuey, Lemle, Kelleher, Kohlmeyer, Dennery, Huntlye, New Orleans, La., for defendants-appellees.

Appeal from the United States District Court for the Eastern District of Louisiana.

Before POLITZ, GARWOOD, and JOLLY, Circuit Judges.

POLITZ, Circuit Judge:

Jerry Dalton appeals the dismissal of his claims against Hartley Marine Corp. and Midland Enterprises for lack of personal jurisdiction. Finding the district court's decision supported by the facts and applicable law, we affirm.

Background

This suit arises out of an injury allegedly sustained in a slip and fall by Dalton while employed as a deckhand aboard the M/V MIKE CREDITOR, which operated in the Mississippi River off Memphis, Tennessee. Asserting subject-matter jurisdiction under the Jones Act and general maritime law Dalton, a Mississippi resident, filed suit in federal court in New Orleans. Dalton sued his employer, R & W Marine, an unincorporated division of Hartley Marine Corp. Hartley, a Delaware corporation, has its statutory office in Wilmington, its registered office in Cincinnati, Ohio, and its principal headquarters in Paducah, Kentucky and Point Pleasant, West Virginia.

Hartley moved to dismiss for lack of personal jurisdiction, improper venue, and insufficiency of service. After taking Hartley's deposition through its general counsel, pursuant to Fed.R.Civ.P. 30(b)(6), Dalton filed an amended complaint adding Midland Enterprises, Inc., Hartley's parent corporation, as a defendant. Midland, also a Delaware corporation with its principal place of business in Cincinnati, filed an identical motion to dismiss.

According to the affidavits and deposition submitted to the district court Hartley, a Midland subsidiary, is one of five divisions providing services to the inland marine towing industry, including midstream refueling, boat and barge repair and building, and towing. Hartley confines its activities to the inland waters in and adjacent to West Virginia, Kentucky, and Tennessee. It transacts no business in Louisiana, is not authorized to do business in Louisiana, and has no offices, employees, or property in Louisiana.

Midland, owner of all of Hartley's stock, is a holding company and parent of a number of subsidiaries, including five corporations organized under Louisiana law, and four licensed to do business in Louisiana. It has no employees and has no offices or property in Louisiana, does no direct business there, and is not authorized to do so. Midland is, however, record owner of most of the boats and barges operated by its subsidiaries, including those in Louisiana, which do so under a bareboat charter. These boats regularly travel the Mississippi River, in and through Louisiana. Midland also oversees advertising that reaches the state.

Dalton contends that Midland and Hartley had sufficient contacts with Louisiana to be subject to jurisdiction there. In the alternative, Dalton asserted that Midland was the alter ego of its Louisiana subsidiaries, arguing that this could then be imputed to Hartley by virtue of its relationship with Midland. The district court dismissed Dalton's complaint, ultimately concluding that assertion of its jurisdiction over Midland and Hartley would violate norms of fair play and substantial justice. Dalton timely appealed.

Analysis

The analysis used to determine whether a court may assert jurisdiction over a non-resident defendant has two components. First, the defendant must be amenable to service of process under the forum state's jurisdictional long-arm statute. Second, the exercise of jurisdiction under this statute must comport with norms imposed by the due process clause of the fourteenth amendment. See Stuart v. Spademan, 772 F.2d 1185 (5th Cir.1985). Louisiana's long-arm statute was first interpreted to permit service of process to the extent permitted by the due process clause. See Pedelahore v. Astropark, Inc., 745 F.2d 346 (5th Cir. 1984). The pertinent statute was then specifically amended to so provide. Acts 1987, No. 418, adding subsection (B) to La. R.S. 13:32.01. The statutory and constitutional inquiries thus merge.

The due process clause limits the courts' power to assert personal jurisdiction over non-resident defendants to situations in which they engage in "certain minimum contacts with [the forum] such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.' " International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945) (citations omitted). ¹ Even where such "minimum contacts" exist, we also inquire whether requiring a defendant to litigate in the forum state would be unfair. See Asahi Metal Industry Co. v. Superior Court, 480 U.S. 102, 107 S.Ct. 1026, 94 L.Ed.2d 92 (1987).

1. Minimum Contacts.

This jurisdictional analysis has been further refined to vary with the nature of the underlying litigation. When a cause of action arises out of a defendant's purposeful contacts with the forum, minimum contacts are found to exist and the court may exercise its "specific" jurisdiction. See World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980). Even a single, substantial act directed toward the forum can support specific jurisdiction. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985). Where a cause of action does not arise out of a foreign defendant's purposeful contacts with the forum, however, due process requires that the defendant have engaged in "continuous and systematic contacts" in the forum to support the exercise of "general" jurisdiction over that defendant. See Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984). In this situation, the forum state has no direct interest in the specific cause of action asserted. Accordingly, contacts of a more extensive quality and nature are required. ² As both sides readily concede, the instant case involves the district court's exercise of its general, rather than specific, jurisdiction.

In the instant case, we review this issue de novo, as a question of law, bearing in mind that Dalton need only prove a prima facie case of personal jurisdiction prior to trial. WNS, Inc. v. Farrow, 884 F.2d 200 (5th Cir.1989). We find the district court's determination to be correct.

Dalton first contends that Midland has sufficient contacts with Louisiana to warrant personal jurisdiction over Midland there. Dalton asserts that Midland bareboat charters its boats to its Louisiana subsidiaries (which yields some 12.9% of Midland's total revenues), engages in advertising that reaches Louisiana, and has purchased vessels at marshals' sales within the state. These contacts, however, are not sufficiently systematic and continuous to constitute a general presence in the state. The strongest support for jurisdiction is Midland's bareboat charters, which by definition vest most of the incidents of ownership in the charterer operating the vessels. See Deal v. A.P. Bell Fish Co., 674 F.2d 438 (5th Cir.1982). Although Midland's continued ownership of these vessels presents a somewhat more "continuous and systematic" presence in the state than Beech's airplane sales in Bearry, like Beech, Midland takes care that these charters are entered into, and payments made pursuant to them are remitted, in Cincinnati. A corporation's "obvious intent to exercise its due process rights" should not be disregarded lightly. Bearry, 818 F.2d at 376. ³

Dalton's next contention, that Hartley has sufficient contacts with Louisiana in its own right to subject it to jurisdiction, is even less persuasive. Dalton asserts that Hartley sells fuel to Louisiana purchasers and that he has, at least once, traveled into Louisiana territorial waters on a boat operated by Hartley. Hartley insists that it deliberately restricts its operations to the "Upper Inland Waterways," where its facilities are located and that although it may sell fuel to companies with Louisiana billing addresses, any fuel sold was actually transferred in refueling operations conducted while the boats were underway. These alleged contacts, even if true, are insufficient to constitute presence in Louisiana for jurisdictional purposes.

Even...