Ex Parte Duck Boo Intern. Co., Ltd.

• Decision Date: 16 November 2007
• Docket Number: 1061114.
• Parties: EX PARTE DUCK BOO INTERNATIONAL COMPANY, LTD. In re Tonya Leann Leytham, administratrix and personal representative of the estate of Tiffany Stabler, deceased, and as mother and next friend of Tiffany Stabler, deceased v. Kia Motors America, Inc., et al.
• Court: Alabama Supreme Court

985 So.2d 900

EX PARTE DUCK BOO INTERNATIONAL COMPANY, LTD. In re Tonya Leann Leytham, administratrix and personal representative of the estate of Tiffany Stabler, deceased, and as mother and next friend of Tiffany Stabler, deceased v. Kia Motors America, Inc., et al.

1061114.

Supreme Court of Alabama.

November 16, 2007.

Michael D. Knight and Karen Tucker Luce of McDowell Knight Roedder & Sledge, L.L.C., Mobile, for petitioner.

George W. Finkbohner III, David G. Wirtes, Jr., and George M. Dent III of Cunningham, Bounds, Crowder, Brown & Breedlove, L.L.C., Mobile, for respondent.

LYONS, Justice.

The petitioner, Duck Boo International Company, Ltd., a manufacturer of seat belts for motor vehicles, is a defendant in an action pending in the Mobile Circuit Court. Kia Motors America, Inc., and Kia Motors Corporation (collectively referred to as "Kia Motors"), are also defendants in that action. Tiffany Stabler was killed in an automobile accident while driving a vehicle manufactured by Kia Motors and equipped with a seat belt manufactured by Duck Boo, which Stabler was wearing at the time of the accident. Tonya Leann Leytham, in her capacity as administratrix and personal representative of Stabler's estate, and as Stabler's mother and next friend, sued Duck Boo, Kia Motors and several other defendants. Duck Boo is located in South Korea and contends it does no direct business with, or in, the United States. Duck Boo filed a motion to dismiss the complaint based upon a lack of personal jurisdiction. The trial court denied the motion and Duck Boo has filed a petition for the writ of mandamus asking us to direct the trial court to dismiss the claims against it on the basis that the trial court lacks personal jurisdiction over Duck Boo. We deny the petition.

I. Proceedings in the Trial Court

A. Procedural Matters

The accident that is the basis of Leytham's complaint occurred on or about July 4, 2004, when Stabler was involved in a fatal automobile accident while she was driving a 1999 Kia Sephia automobile. Leytham alleged that Stabler was wearing her seat belt at the time of the accident and that the seat belt, which was manufactured by Duck boo, failed, allowing Stabler to be ejected from the vehicle and to suffer fatal injuries. Specific to Duck Boo, Leytham alleged that Duck Boo is a foreign corporation with its principal place of business in a place other than Alabama.

Duck Boo filed a motion to dismiss based upon lack of personal jurisdiction to which it attached the affidavit of Jung-Ho Choi, the director in charge of the technical department at Duck Boo. Leytham thereafter served interrogatories and requests for production on Duck Boo. Reasserting the jurisdictional arguments contained in its motion to dismiss and also arguing that Leytham had not alleged a colorable claim of jurisdiction, Duck Boo asserted that a response to the discovery was not required. Leytham filed a motion to compel, contending that Duck Boo, by placing the seat belts into the stream of commerce in the United States without any limitations, should reasonably expect to be haled into court in one of the states in which the product is used, and for that reason, she says, Duck Boo was required to respond to discovery directed to the issue of personal jurisdiction.

Leytham amended her complaint to add additional jurisdictional allegations. The trial court thereafter granted the motion to compel before Duck Boo had filed a response. Duck Boo moved to reconsider, contending that simply allowing a product to be placed into the stream of commerce was insufficient to subject an entity to jurisdiction in Alabama, and that evidence that the defendant had purposefully availed itself of the privilege of doing business in Alabama and that it had purposefully directed activities toward the State was required. The trial court denied the motion to reconsider. Duck Boo filed a subsequent motion to dismiss for lack of personal jurisdiction. The trial court denied the motion to dismiss eight days after denying the motion to reconsider.

B. Matters Relevant to Duck Boo's Contacts

Leytham's complaint alleges that the following establish that the trial court has personal jurisdiction over Duck Boo: Duck Boo "purchased and carries liability insurance that provides insurance coverage in every one of the United States, including Alabama"; Duck Boo "has engaged in designing, manufacturing and marketing its seatbelts and other products to conform with United States governmental and industry wide safety and design standards and criteria, including safety standards by United States regulatory agencies and state common law court decisions, including the Courts of Alabama"; Duck Boo "and/or its representatives have attended American automobile manufacturing trade shows and/or have participated in trade groups to ensure that [its] products comply with governmental and industry wide safety and design standards and criteria, including government standards imposed by legislative bodies, regulatory agencies and/or state common law court decisions, including the Courts of Alabama"; Duck Boo "has advertised through the World Wide Web and print and other media with a goal towards expanding the markets for its seatbelts and other products to all of the United States, including Alabama"; Duck Boo "has employed personnel and consultants ... to provide guidance and advice about how to successfully market its seatbelts and other products to automobile and other manufacturers who, in turn, sell their products in all of the United States, including Alabama"; Duck Boo "has retained American legal counsel ... to defend and protect [its] interests when foreseeable product liability suits would be filed against it in the United States, including Alabama"; Duck Boo attached to the seat belt in the automobile driven by Stabler "a label written in the English language and stating, among other things, that it was manufactured by [Duck Boo] International Co., Ltd., and that it complies with the United States Federal Motor Vehicle Safety Standards applicable to seatbelts"; Duck Boo "contracted with one or more companies in the United States to conduct seatbelt testing, it being the purpose of [Duck Boo] to avail itself of markets throughout the United States including Alabama"; Duck Boo "has had many different models of its seatbelts shipped to the United States to be tested for compliance with the United States of American Federal Motor Vehicle Safety Standard 209 by a U.S. based company—i.e., SGS U.S. Testing Company, Inc."; Duck Boo "attaches identification tags to the seatbelts that it manufacturers, just like the seatbelt with the label in English referenced hereinabove"; and Duck Boo "previously included on its website a time line stating that in 1987 it began to export vehicle seatbelts to the United States." In support of her right to compel discovery, Leytham submitted to the trial court pleadings in actions against Duck Boo in other states, documents produced by Kia Motors reflecting testing by SGS U.S. Testing Company, Inc., and an affidavit of one of Leytham's attorneys attaching a photograph of the Duck Boo seat belt on the vehicle involved in the accident made the basis of this claim, which reflects that Duck Boo manufactured the seat belt in accordance with United States Federal Motor Vehicle Safety Standards.

Duck Boo's motion to dismiss relied upon the affidavit of Choi, who testified that Duck Boo conducts business entirely within the Republic of Korea and maintains no agents, physical presence, or property within the State of Alabama or the United States; that it manufactures vehicle-restraint systems that it sells exclusively to Korean final-stage motor-vehicle manufacturers, who are solely responsible for integrating Duck Boo's restraint system into their final product; and that it has no control over where the final product is marketed, sold, or distributed, because the marketing, selling, and distributing is left to the final-stage manufacturer. Choi also testified that Duck Boo is not qualified, authorized, or registered to do business in Alabama; that it does not sell any products in Alabama and has never entered into any contract in Alabama; that it has never entered into a contract with an Alabama resident and has never entered into a contract to be performed in Alabama; that it has never transacted business in Alabama and is not currently doing business in Alabama; that it has never provided any services in Alabama; that it does not now pay, and has never paid, taxes in Alabama; that it does not now own, rent, purchase, or lease, and has not ever owned, rented, purchased, or leased, any real or personal property in Alabama; that it does not maintain any office or place of business in Alabama; that it does not have any assets in Alabama; that it does not have any distributors in Alabama; that it has never had an agent for service of process in Alabama; that it has never maintained a telephone, telex, or telefax number or address in Alabama; that it does not have, and never has had, any employees (including salespersons, representatives, agents, or servants) who conducted business in Alabama or who were residents of Alabama; that it does not do, and has never done, any advertising in Alabama; that it does not solicit, and has not ever solicited, business directly or through agents in Alabama; that it does not provide regular advice to customers in Alabama; that it has never marketed any product in Alabama; that it has no officers, employees, or directors living in Alabama; that it has never applied for a loan or acted as a guarantor or cosigner on a bank loan in Alabama; that it has never maintained any records, bank accounts, payroll records, books of account, and/or any other business record in Alabama; that it has never initiated litigation in Alabama; that it has never consented to personal jurisdiction of a court in Alabama; that it never...