Kraus v. Alcatel-Lucent, Allen-Bradley Co.

• Decision Date: 27 February 2020
• Docket Number: CIVIL ACTION NO. 18-2119
• Parties: Robert J. KRAUS and Margaret M. Kraus, h/w v. ALCATEL-LUCENT, Allen-Bradley Company, AMETEK, Inc., BBC Brown Boveri, k/n/a ABB, Inc., Belden Wire & Cable Company, LLC, CBS Corporation, formerly known as Westinghouse Electric Corporation, Clark Controller Co., Espey Manufacturing & Electronics Corp., Ford Motor Co., General Dynamics, General Electric Company, Gould Electronics, Inc., GTE Products of Connecticut Corporation, Honeywell International, Honeywell, Inc., IMO Industries, Inc., formerly known as DeLaval Steam Turbine Company, ITT Industries, L-3 Communications, Lockheed Martin Corporation Service Company, Metropolitan Life Insurance Co., Minnesota Mining and Manufacturing, Motorola Solutions, Navcom Defense Electronics, Northrop Grumman Norden Systems, Northrop Grumman Corporation, Philips North America, LLC, Raytheon, Rockbestos Co., Rockwell Collins, Inc., Rogers Corporation, Space Systems/Loral, Square D Company, Unisys and United Technologies
• Court: U.S. District Court — Eastern District of Pennsylvania

441 F.Supp.3d 68

Robert J. KRAUS and Margaret M. Kraus, h/w

v.ALCATEL-LUCENT, Allen-Bradley Company, AMETEK, Inc., BBC Brown Boveri, k/n/a ABB, Inc., Belden Wire & Cable Company, LLC, CBS Corporation, formerly known as Westinghouse Electric Corporation, Clark Controller Co., Espey Manufacturing & Electronics Corp., Ford Motor Co., General Dynamics, General Electric Company, Gould Electronics, Inc., GTE Products of Connecticut Corporation, Honeywell International, Honeywell, Inc., IMO Industries, Inc., formerly known as DeLaval Steam Turbine Company, ITT Industries, L-3 Communications, Lockheed Martin Corporation Service Company, Metropolitan Life Insurance Co., Minnesota Mining and Manufacturing, Motorola Solutions, Navcom Defense Electronics, Northrop Grumman Norden Systems, Northrop Grumman Corporation, Philips North America, LLC, Raytheon, Rockbestos Co., Rockwell Collins, Inc., Rogers Corporation, Space Systems/Loral, Square D Company, Unisys and United Technologies

CIVIL ACTION NO. 18-2119

United States District Court, E.D. Pennsylvania.

Filed February 27, 2020

Robert E. Paul, Paul Reich & Myers, PC, Philadelphia, PA, for Plaintiffs Robert J. Kraus and Margaret M. Kraust.

Deborah Maria Parker, Helena Wallentin, Jarred M. Conforte, Glazier Yee LLLP, Los Angeles, CA, Michael David Smith, Glazier Yee LLP, San Franciso, CA, for Defendant Lockheed Martin.

MEMORANDUM OPINION

Savage, J.

Moving to dismiss this asbestos action for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2), defendant Northrop Grumman Corporation ("Northrop"), a Delaware corporation with its principal place of business in Virginia,¹ contends that the plaintiffs, Robert and Margaret Kraus, have not alleged sufficient facts establishing the existence of general or specific jurisdiction over it. Northrop argues that Pennsylvania's consent-by-registration statute is unconstitutional and cannot support the exercise of general jurisdiction. Even if valid, it contends, neither Northrop nor its predecessors were registered at the time Robert Kraus ("Kraus")² was exposed to Northrop's products in Pennsylvania.³

The plaintiffs contend that there is general jurisdiction over Northrop because it and its predecessors-in-interest consented to jurisdiction when they registered to do business in Pennsylvania as foreign corporations.

We conclude that Pennsylvania's consent-by-registration statute is constitutional, and that consent jurisdiction arises at the time the suit is filed, not when the causes of action arose. Thus, the plaintiffs have met their burden of establishing the existence of personal jurisdiction over Northrop.

Background

According to the fourth amended complaint, Kraus was exposed to asbestos during his service in the Navy aboard the U.S.S. Cambria and later when working at General Electric. From July 1964 through May 1967, Kraus, as the electronics officer and subsequently the communications officer on the Cambria , worked in close proximity to asbestos-containing electronic equipment. Kraus alleges that during the Cambria 's equipment overhaul at the Philadelphia Naval Shipyard in 1965, he supervised the repair of electronic and radio equipment containing asbestos.⁴

Kraus contends that he was exposed to asbestos dust from three products manufactured by Northrop's predecessors-in-interest, The Hallicrafters Co. and Litton Industries: the AM/1365-URT (Hallicrafters), AN/ULQ-6A (Hallicrafters) and AN/UPX-1 (Litton).⁵ He alleges that Hallicrafters manufactured the AM-1365/URT specifically for installation on and delivery to the Cambria during its 1965 repair in Philadelphia. With respect to the AN/ULQ-6A and AN/UPX-1, although installed on the Cambria in Virginia in 1963, he contends that they remained on the ship during the 1965 overhaul.⁶

In support of his claim that Hallicrafters is Northrop's predecessor-in-interest, Kraus cites a Wikipedia page⁷ stating that Hallicrafters was "sold ... to the Northrop Corporation" in 1966. To show that Litton is Northrop's predecessor-in-interest, he cites a Wikipedia page that indicates it was "bought" by Northrop in 2001.⁸ The reliability of Wikipedia aside, Northrop does not dispute the company history.⁹

Northrop registered to do business in Pennsylvania as a foreign corporation on March 19, 1996.¹⁰ Hallicrafters and Litton registered to do business in Pennsylvania in 1966.¹¹

Personal Jurisdiction Standards

Once a defendant challenges personal jurisdiction, the plaintiff bears the burden of proving, by a preponderance of the evidence, facts establishing a basis for the exercise of jurisdiction.

Metcalfe v. Renaissance Marine, Inc. , 566 F.3d 324, 330, 336 (3d Cir. 2009) (citing Carteret Sav. Bank, F.A. v. Shushan , 954 F.2d 141, 146 (3d Cir. 1992) ). In considering a motion to dismiss for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2), as we do with a motion to dismiss for failure to state a claim under Rule 12(b)(6), we accept as true the plaintiff's allegations and draw all reasonable inferences in favor of the plaintiff. Shuker v. Smith & Nephew, PLC , 885 F.3d 760, 780 (3d Cir. 2018) (citing O'Connor v. Sandy Lane Hotel Co. , 496 F.3d 312, 316 (3d Cir. 2007) ). However, unlike with Rule 12(b)(6), the scope of review under Rule 12(b)(2) is not limited to the face of the pleadings. Patterson by Patterson v. FBI , 893 F.2d 595, 603–04 (3d Cir. 1990) (citation omitted) (holding Rule 12(b)(2) motion is "inherently a matter which requires resolution of factual issues outside the pleadings"). Once a defendant challenges personal jurisdiction, the plaintiff must "prove by affidavits or other competent evidence" that jurisdiction is proper. Metcalfe , 566 F.3d at 330 (citation omitted).

When the parties do not conduct jurisdictional discovery and there is no evidentiary hearing, the plaintiff need only establish a prima facie case of personal jurisdiction. Shuker , 885 F.3d at 780. To determine whether the plaintiff has made this prima facie showing, we assume all factual allegations in the affidavits and other evidence submitted to be true and construe all factual disputes in the plaintiff's favor. Metcalfe , 566 F.3d at 331, 333.

There are two types of personal jurisdiction, general and specific. The focus of general jurisdiction is on the relationship between the defendant and the forum state, not on the relationship of the claims to the forum. Bristol-Myers Squibb Co. v. Super. Ct. of Cal., San Francisco Cty. , ––– U.S. ––––, 137 S. Ct. 1773, 1780, 198 L.Ed.2d 395 (2017) (citing Goodyear Dunlop Tires Operations, S.A. v. Brown , 564 U.S. 915, 919, 131 S.Ct. 2846, 180 L.Ed.2d 796 (2011) ). The specific jurisdiction inquiry focuses on the relationship of the litigation to the defendant's contacts with the forum. Walden v. Fiore , 571 U.S. 277, 284, 134 S.Ct. 1115, 188 L.Ed.2d 12 (2014).

Before exercising personal jurisdiction over a nonresident, a district court must conduct a two-step analysis. Eurofins Pharma US Holdings v. BioAlliance Pharma SA , 623 F.3d 147, 155 (3d Cir. 2010). First, there must be a statutory basis under the law of the forum state for exercising jurisdiction. Walden , 571 U.S. at 283, 134 S.Ct. 1115 (citing Daimler AG v. Bauman , 571 U.S. 117, 125, 134 S.Ct. 746, 187 L.Ed.2d 624 (2014) ); Fed. R. Civ. P. 4(k)(1)(A). Second, the nonresident must have sufficient minimum contacts with the forum state to satisfy constitutional due process. BNSF Ry. Co. v. Tyrrell , ––– U.S. ––––, 137 S. Ct. 1549, 1558, 198 L.Ed.2d 36 (2017).

Statutory Basis for Jurisdiction

Pennsylvania's long-arm statute supplies several bases for the exercise of general personal jurisdiction over a nonresident defendant. 42 Pa. C.S. § 5301. It provides for general jurisdiction over a corporation that was incorporated as a Pennsylvania entity, is a foreign company registered to do business in Pennsylvania, consents to suit, or carries on "a continuous and systematic part" of its business in Pennsylvania. Id. § 5301(a)(2)(i)–(iii).¹² The plaintiffs contend that the registration of Northrop and its predecessors-in-interest to do business as foreign corporations in Pennsylvania supplies a basis to exercise general personal jurisdiction over it. See id. § 5301(a)(2)(i).

Minimum Contacts with Pennsylvania

A statutory basis for the exercise of personal jurisdiction alone is not sufficient. The exercise of jurisdiction must also be consistent with the limits imposed by the Due Process Clause of the Fourteenth Amendment. Walden , 571 U.S.at 283, 134 S.Ct. 1115 (citing Daimler , 571 U.S. at 125, 134 S.Ct. 746 ). To meet this standard, the plaintiff must establish that "certain minimum contacts" exist between the nonresident defendant and the forum so that the exercise of jurisdiction will "not offend ‘traditional notions of fair play and substantial justice.’ " Tyrrell , 137 S. Ct. at 1558 (quoting Int'l Shoe Co. v. Wash. , 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945) ).

General jurisdiction over a foreign corporation can be established in several ways. It exists where its "affiliations with the [forum] State are so ‘continuous and systematic’ as to render [it] essentially at home" there. Tyrrell , 137 S. Ct. at 1558 (quoting Daimler , 571 U.S. at 127, 134 S.Ct. 746 ). Jurisdiction can also be established through consent. J. McIntyre Mach., Ltd. v. Nicastro , 564 U.S. 873, 880, 131 S.Ct. 2780, 180 L.Ed.2d 765 (2011) (citing Ins. Corp. of Ireland v. Compagnie des Bauxites de Guinee , 456 U.S. 694, 703-04, 102 S.Ct. 2099, 72 L.Ed.2d 492 (1982) ). A foreign corporation that registers to do business in Pennsylvania "has consented to the jurisdiction of Pennsylvania courts." Sciortino v. Jarden, Inc. , 395 F. Supp. 3d 429, 438 (E.D. Pa. 2019) (citing Bane v. Netlink, Inc. , 925 F.2d 637, 640 (3d Cir. 1991) ).

Analysis

Relying on section 5301(a)(2)(i) of Pennsylvania's long-arm statute, which is referred to as a "consent-by-registration" statute, the plaintiffs contend that...