Felch v. Transportes Lar-Mex Sa De CV

Decision Date22 August 1996
Docket NumberLAR-MEX,No. 95-20653,95-20653
PartiesChristopher FELCH, Individually and as Representative of the Estate of Carol Hoffman Stein, Deceased, Plaintiff-Appellee, v. TRANSPORTESSA DE CV, et al., Defendants, Transportes Lar-Mex SA DE CV, Defendant-Appellant.
CourtU.S. Court of Appeals — Fifth Circuit

Lance C. Winchester, Carl D. Kulhanek, Jr., Helm, Pletcher, Bowen & Saunders, Houston, TX, for plaintiff-appellee.

Guillermo Gerardo Alarcon, J. Alberto Alarcon, Hall, Quintanilla & Alarcon, Laredo, TX, for defendant-appellant.

Appeal from the United States District Court for the Southern District of Texas.

Before GARWOOD, HIGGINBOTHAM and BENAVIDES, Circuit Judges.

GARWOOD, Circuit Judge:

Plaintiff-appellee Christopher Felch (Felch) filed this wrongful death and survival suit in Texas state court. Defendant-appellant Transportes Lar-Mex (Lar-Mex), a carrier of goods incorporated in Mexico, removed the case to the court below and shortly thereafter filed a motion to dismiss for lack of personal jurisdiction. Following a hearing on the issue of personal jurisdiction, the district court denied Lar-Mex's motion. Lar-Mex thereafter gave notice to the district court that it would not participate in the litigation other than to continue asserting its jurisdictional defense. When Lar-Mex failed to appear at a pre-trial conference, the district court entered default judgment against Lar-Mex. Thereafter, following a hearing to assess Felch's damages, the district court entered judgment in Felch's favor. Lar-Mex appeals.

Facts and Proceedings Below

Carol Hoffman Stein, Felch's mother, was operating her vehicle on a Mexican highway, between Monterrey, Mexico and Nuevo Laredo, Mexico, on November 27, 1991, when she was killed in a head-on collision with a Lar-Mex tractor trailer operated by Lar-Mex employee Clemente Alvarez Velasquez.

On September 15, 1993, Felch, individually and as representative of the estate of his deceased mother, filed this wrongful death and survival suit in Texas state court against Lar-Mex and Julio Cesar Gonzalez Garcia 1. In response, Lar-Mex filed a special appearance objecting to jurisdiction. Lar-Mex subsequently removed the case to the district court below on the basis of diversity jurisdiction. Then, shortly following removal, Lar-Mex filed a motion to dismiss for lack of personal jurisdiction. 2

Counsel for Felch and Lar-Mex met in San Antonio, Texas, and agreed upon a discovery plan as required by Fed.R.Civ.P. 26. Counsel agreed to limit discovery to the jurisdictional issue until the district court ruled on Lar-Mex's motion to dismiss. Accordingly, on May 17, 1994, Felch took the deposition of Americo Raymon Garcia-Rodriguez (Garcia), the designated representative of Lar-Mex, in Laredo, Texas. This deposition testimony revealed the following:

(1) Lar-Mex is a corporation incorporated in Monterrey, Mexico;

(2) None of Lar-Mex's offices are located in the United States;

(3) Lar-Mex conducts business as a carrier of goods in Mexico and, to a very limited degree, in the United States; 3

(4) Lar-Mex does not have any representatives or employees in the United States;

(5) Lar-Mex is not licensed in the United States to operate as a motor carrier;

(6) Lar-Mex collects merchandise in Nuevo Laredo and distributes this merchandise in Mexico; 4

(7) Lar-Mex does not advertise in Texas; it does not carry a yellow page ad in Texas;

(8) Lar-Mex does not have a telephone line in Texas or anywhere else in the United States, although its name does appear in the Laredo, Texas, telephone book within the section relating to Nuevo Laredo, Mexico;

(9) It is ordinary in the course of Lar-Mex's business to make telephone calls to and receive telephone calls from customers officing in Laredo, Texas--coordinating shipments and receiving orders and communications;

(10) Lar-Mex contracted to purchase trailers from the Laredo, Texas, office of Xtra Lease; 5

(11) Lar-Mex purchased an air pistol used to repair flat tires on its trucks from a Laredo, Texas company, and additionally purchased wheels for which payment was due in Laredo, Texas;

(12) Lar-Mex leased several trailers from Strick Lease, the predecessor of Xtra Lease; Lar-Mex made monthly lease payments which were sometimes sent by mail to Laredo, Texas; on occasion, these payments were picked up at Lar-Mex's Nuevo Laredo office; 6 (13) Lar-Mex has agreements with companies officing in Laredo, Texas, warranting that Lar-Mex will return trailers belonging to those companies in the same condition in which Lar-Mex received these trailers; 7

(14) Lar-Mex employed a specific designation on its invoices to identify shipments transported by Lar-Mex across the Mexico-Texas border and into Laredo, Texas;

(15) Lar-Mex procured an insurance policy to cover "vehicles" for which Lar-Mex is responsible and which Lar-Mex operates within Texas; this coverage is conditioned on Lar-Mex taking these vehicles (into Texas) no further than 26 miles from the Mexico-U.S. border; and

(16) At the time of the accident, Clemente Alvarez Velasquez was driving a Lar-Mex tractor trailer in the course of Lar-Mex's business; 8 the truck was going from Monterrey, Mexico, to Nuevo Laredo, Mexico.

On June 7, 1994, Felch filed his opposition to Lar-Mex's motion to dismiss for lack of personal jurisdiction, attaching excerpts from Garcia's deposition. Then, on June 21, 1994, Lar-Mex filed a reply to this opposition, attaching the entire transcript of Garcia's deposition.

The district court subsequently scheduled a hearing on Lar-Mex's motion to dismiss. After receiving an additional reply filed by Felch, the court held this hearing on July 29, 1994. The court denied Lar-Mex's motion on August 30, 1994.

Lar-Mex then filed a motion to reconsider, and Felch filed his opposition thereto. The district court denied this motion on November 22, 1994.

Lar-Mex filed no other pleading in the case until April 3, 1995, when it gave notice to the court that it would not participate in the litigation any further other than to rely on its jurisdictional defense.

Thereafter, the court set a pre-trial conference for June 22, 1995. When Lar-Mex did not appear at this hearing, the district court entered a default judgment against Lar-Mex. Accordingly, the district court conducted an evidentiary hearing on Felch's damages. No evidence was presented at this hearing on the jurisdictional issue concerning Lar-Mex's contacts with Texas. The district court entered final judgment on August 18, 1995, awarding Felch a total of $1,120,591.51 in damages, plus interest and costs. Lar-Mex appeals.

Discussion

The exercise of personal jurisdiction over a nonresident defendant comports with principles of due process when two requirements are met. First, the nonresident defendant must have "purposefully availed himself of the benefits and protections of the forum state by establishing 'minimum contacts' with that forum state." Wilson v. Belin, 20 F.3d 644, 647 (5th Cir.) (citing International Shoe Co. v. Washington, 326 U.S. 310, 315-17, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945)), cert. denied, 513 U.S. 930, 115 S.Ct. 322, 130 L.Ed.2d 282 (1994). Second, the exercise of jurisdiction over the nonresident defendant must not "offend 'traditional notions of fair play and substantial justice.' " Wilson, at 647 (quoting Asahi Metal Industry Co., Ltd. v. Superior Court of California, Solano County, 480 U.S. 102, 113, 107 S.Ct. 1026, 1033, 94 L.Ed.2d 92 (1987)). "The 'minimum contacts' prong of the inquiry may be further subdivided into contacts that give rise to 'specific' personal jurisdiction and those that give rise to 'general' personal jurisdiction. Specific jurisdiction is appropriate when the nonresident defendant's contacts with the forum state arise from, or are directly related to, the cause of action. General jurisdiction, however, will attach, even if the nonresident defendant's contacts with the forum state are not directly related to the cause of action, if the defendant's contacts with the forum state are both 'continuous and systematic.' " Wilson, at 647 (citations omitted).

Finally, if the nonresident defendant's related or unrelated minimum contacts with the forum state are sufficient, "[W]e must then consider whether the 'fairness' prong of the jurisdictional inquiry is satisfied." Id. (citations omitted). 9

I. Specific Personal Jurisdiction

"When the facts are not in dispute, we review de novo a district court's determination that its exercise of personal jurisdiction over a nonresident defendant is proper." Wilson v. Belin, 20 F.3d 644, 647 (5th Cir.), cert. denied, 513 U.S. 930, 115 S.Ct. 322, 130 L.Ed.2d 282 (1994); see also Kevlin Services, Inc. v. Lexington State Bank, 46 F.3d 13, 14 (5th Cir.1995).

In considering whether Lar-Mex had contacts with Texas sufficient to warrant the exercise of specific personal jurisdiction (specific jurisdiction), this Court must determine whether the present litigation resulted from injuries arising out of or related to the nonresident defendant's contacts with the forum state. See Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 413-16 & n. 8, 104 S.Ct. 1868, 1872 & n. 8, 80 L.Ed.2d 404 (1984); Jones v. Petty-Ray Geophysical Geosource, Inc., 954 F.2d 1061, 1068 (5th Cir.) (specific jurisdiction is proper only if the cause of action arises from a particular act or activity in the forum), cert. denied, 506 U.S. 867, 113 S.Ct. 193, 121 L.Ed.2d 136 (1992).

In the present case, the following facts are undisputed: (1) the fatal accident underlying Felch's cause of action occurred on a highway in Mexico between Nuevo Laredo and Monterrey; (2) Carol Hoffman Stein, Felch's mother, died in Mexico; and (3) all of the defendant's negligence, if any, occurred in Mexico. These facts preclude a finding that the instant litigation resulted from injuries arising out of or related to contacts between Lar-Mex and Texas. 10

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