Doula v. United Technologies Corp.

• Decision Date: 19 March 1991
• Docket Number: Civ. No. 4-90-685.
• Citation: 759 F. Supp. 1377
• Parties: Moutoume DOULA, Daniel Mbanjock, and Josue Calvin Nguele, Plaintiffs, v. UNITED TECHNOLOGIES CORPORATION, a foreign corporation, Defendant.
• Court: U.S. District Court — District of Minnesota

759 F. Supp. 1377

Moutoume DOULA, Daniel Mbanjock, and Josue Calvin Nguele, Plaintiffs, v. UNITED TECHNOLOGIES CORPORATION, a foreign corporation, Defendant.

Civ. No. 4-90-685.

United States District Court, D. Minnesota, Fourth Division.

March 19, 1991.

David Ford Fitzgerald, Stephen P. Watters, Deborah C. Eckland, and Rider, Bennett, Egan & Arundel, Minneapolis, Minn., Russell Thomas Roe, Roe Law Office, Maple Plain, Minn., for plaintiffs.

Richard H. Kyle, Mark J. Ayotte, and Briggs and Morgan, St. Paul, Minn., and Francis H. Morrison III, Robert A. Brooks, and Day, Berry & Howard, City Place I, Hartford, Conn., for defendant.

ORDER

DOTY, District Judge.

This matter is before the court on defendant's motion to dismiss on the following grounds:

1. Lack of personal jurisdiction;

2. Improper venue; and

3. Insufficient service of process.

In the alternative, defendant moves to transfer venue to the District of Connecticut pursuant to 28 U.S.C. § 1404(a).

Also before the court is plaintiffs' renewed motion to continue the March 1, 1991, hearing so that plaintiffs may conduct discovery on the issue of personal jurisdiction of the defendant in Minnesota.

BACKGROUND

This dispute arises out of an accident occurring when a Cameroon Airlines aircraft exploded at an airport in the City of Doula, Cameroon. The plaintiffs, three individual residents of the Republic of Cameroon, allege that they were injured in the explosion and that the explosion was the result of the defective design, manufacture and assembly of the aircraft engine by Pratt & Whitney Aircraft, a division of United Technologies Corporation (Pratt & Whitney). United Technologies Corporation (UTC Delaware) is a Delaware corporation with its principal place of business in Hartford, Connecticut.

It is undisputed that the engine in this case was designed, manufactured, tested and sold by the Pratt & Whitney facilities in East Hartford and North Haven, Connecticut. It is also undisputed that four UTC employees in Minnesota serve as customer service representatives at the Minneapolis/St. Paul Airport. These employees work out of the Northwest Airlines terminal at the airport. It is further undisputed that according to UTC's 1989 annual report, Northwest Airlines in that year awarded Pratt & Whitney an order for jet engines in the amount of 1.5 billion dollars.¹

The defendant contends that neither UTC (Delaware) nor Pratt & Whitney is licensed or authorized to do business in Minnesota or maintains an agent for service of process in the state. It is undisputed, however, that CT Corporation System, Inc. ("CT Corporation") is the agent for service of process for a corporation entitled United Technologies Corporation, an Alabama corporation (UTC Alabama). It is also undisputed that UTC (Alabama) is a wholly owned subsidiary of UTC (Delaware). The defendant contends that UTC (Alabama) was set up to protect the name United Technologies in various states including Minnesota. UTC (Alabama) has also applied to transact business in Minnesota and its incorporation documents were prepared by counsel for UTC (Delaware) in Hartford, Connecticut.

The plaintiffs contend that other affiliates of UTC also do business in Minnesota, including the Carrier Corporation (which also uses CT Corporation as its corporate agent in the State of Minnesota), Otis Elevator Company (which also uses CT Corporation as its corporate agent in the State of Minnesota), Carrier Distribution Credit Corporation (which also uses CT Corporation as its corporate agent in the State of Minnesota). The SEC Form 10K filing by UTC describes all of these companies as either direct or indirect subsidiaries, units, or affiliates of UTC.

On October 5, 1990, the plaintiffs' summons and complaint were served on CT Corporation which plaintiffs contend is the Delaware corporation's registered agent for service of process in Minnesota. The defendant contends, however, that UTC (Delaware) does not maintain an agent for service of process in Minnesota and that CT Corporation is only the agent of service of process for UTC (Alabama).

The defendant now seeks to dismiss the lawsuit alleging:

1. There is no personal jurisdiction over UTC (Delaware) pursuant to Minnesota's long-arm statute because there is no nexus between plaintiffs' cause of action and any activity of UTC (Delaware) in the state.

2. Venue is improper because the plaintiffs are residents of the Republic of Cameroon, their claim arises out of an aircraft accident in the Republic of Cameroon, and Minnesota lacks personal jurisdiction over the defendant. In the alternative, defendant seeks transfer to the District of Connecticut pursuant to 28 U.S.C. § 1404(a).

3. Service was insufficient because the plaintiffs served CT Corporation, an agent for service of process of UTC (Alabama) not UTC (Delaware).

The plaintiffs contend, however, that service of process was not inadequate. The plaintiffs further contend that there is sufficient nexus between their cause of action and defendant's contacts with the State of Minnesota to satisfy Minnesota's long-arm statute. The plaintiffs also claim that the court has general jurisdiction over UTC (Delaware) based on its general and systematic business contacts with Minnesota. They further contend that UTC (Delaware) has consented to Minnesota's jurisdiction because UTC (Alabama) is its wholly owned subsidiary. UTC (Alabama) and at least four other affiliates or units of UTC (Delaware) have consented to service of process in Minnesota. Plaintiffs contend that venue in Minnesota is proper because jurisdiction exists and that the case should not be transferred to the District of Connecticut pursuant to 28 U.S.C. § 1404(a). Finally the plaintiffs argue that there are genuine issues of material fact regarding the existence of personal jurisdiction over UTC and requests further discovery to establish such jurisdiction.

DISCUSSION

The party seeking federal jurisdiction has the burden of establishing that such jurisdiction exists; the burden may not be shifted to the party challenging that jurisdiction. Scullin Steel Co. v. Nat'l Ry. Utilization Corp., 676 F.2d 309, 311 (8th Cir.1982) (citations omitted). For motions to dismiss for lack of personal jurisdiction or improper venue, "in which no evidentiary hearing is held, the plaintiff must present only a prima facie showing of venue and personal jurisdiction." Delong Equip. Co. v. Washington Mills Abrasive, 840 F.2d 843, 845 (11th Cir.1988) (citations omitted). Moreover, "all pleadings and affidavits are construed in the light most favorable to plaintiff, and where doubts exist, they are resolved in the plaintiff's favor." Hoffritz For Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55, 57 (2d Cir.1985) (citations omitted). With this standard at hand, the court will consider defendant's motions to dismiss for lack of personal jurisdiction and improper venue.

1. UTC's Motion to Dismiss for Lack of Personal Jurisdiction

In order to comply with due process and to establish personal jurisdiction over the defendant in Minnesota, the plaintiffs may show any of the following:

(1) UTC (Delaware) has business in the State of Minnesota which is so pervasive that UTC has subjected itself to the state's general jurisdiction;

(2) UTC (Delaware) has sufficient minimum contacts with the State of Minnesota to comply with the state long-arm statute for the purposes of specific jurisdiction; or

(3) UTC (Delaware) has consented to Minnesota's exercise of jurisdiction over it.

Knowlton v. Allied Van Lines, Inc., 900 F.2d 1196, 1198-1200 (8th Cir.1990); see also Morris v. Barkbuster, Inc., 923 F.2d 1277 (8th Cir.1991); Aftanase v. Economy Baler Co., 343 F.2d 187 (8th Cir.1965). The plaintiffs contend that there is jurisdiction over UTC (Delaware) under all three methods. Each basis for jurisdiction will be examined in turn to determine if jurisdiction over UTC (Delaware) exists.

The plaintiffs first contend that general jurisdiction exists over UTC (Delaware). Under general jurisdiction the plaintiffs' claim need not arise directly out of the defendant's contacts with Minnesota, as long as the defendant has engaged in "continuous and systematic business contacts" with Minnesota. Helicopteros Nacionales v. Hall, 466 U.S. 408, 414-15, 104 S.Ct. 1868, 1872-73, 80 L.Ed.2d 404 (1984) (citing Perkins v. Benguet Consol. Mining Co., 342 U.S. 437, 438, 72 S.Ct. 413, 414-15, 96 L.Ed. 485 (1952) for the due process standard). The Minnesota Supreme Court has interpreted this standard to mean that "the foreign defendant's activities with respect to the forum state must be of such substance that it would not be unfair for defendant to be brought into the forum state's court for a cause of action unrelated to those activities." Real Properties, Inc. v. Mission Ins. Co., 427 N.W.2d 665, 669 (Minn.1988). Further, the Eighth Circuit has explained that general jurisdiction arises "if a defendant is `present' in the State in the sense that, jurisdiction over it exists under the old rubric of physical power or sovereignty .... and it exists as to all claims against the defendant, whether or not arising out of or related to activities within the State." Knowlton, 900 F.2d at 1199; Morris, 923 F.2d at 1280-81. Applying this standard, UTC's (Delaware) business in Minnesota is purposeful, continuous and systematic. The defendant derives substantial income from its business in Minnesota through its sale of jet engines. For example, in 1989 alone Pratt & Whitney received an order for 1.5 billion dollars worth of jet engines from Northwest Airlines. Moreover, Northwest Airlines has had an ongoing business relationship with the defendant and has historically used only Pratt & Whitney jet engines. Pratt & Whitney maintains at least four employees in Minnesota working in conjunction with Northwest Airlines as customer service representatives for Pratt & Whitney engines and airplanes which come through the...