Remmes v. International Flavors & Fragrances, Inc.
| Decision Date | 16 September 2005 |
| Docket Number | No. C04-4061-MWB.,C04-4061-MWB. |
| Citation | 389 F.Supp.2d 1080 |
| Parties | Kevin REMMES, Plaintiff, v. INTERNATIONAL FLAVORS & FRAGRANCES, INC., a New York Corporation; Givaudan Flavors Corp., a Delaware corporation, formerly known as Givaudan, Inc. and Givaudan-Roure, a division of Roche Group; Flavors of North America, Inc., an Illinois corporation; Sensient Flavors, Inc., a Wisconsin corporation, formerly known as Universal Flavors, Inc.; the Flavor & Extract Manufacturers Association of the United States, a Maryland non-profit corporation; and, the Roberts Group, L.L.C., a District of Columbia limited liability company, Defendants. |
| Court | U.S. District Court — Northern District of Iowa |
Daniel M. Homolka, Minneapolis, MN, Dennis M. McElwain, Smith & McElwain, Sioux City, IA, for Plaintiff.
Daniel Lee Jones, Jr., Frank C. Woodside, III, Mary-Jo Middelhoff, Dinsmore & Shohl, LLP, Cincinnati, OH, Robert M. Livingston, William R. Hughes, Jr., Stuart Tinley Peters Thorn Hughes Faust & Madsen, Council Bluffs, IA, Alan E. Fredregill, Patrick L. Sealey, Heidman Redmond Fredregill Patterson Plaza Dykstra & Prahl, Michael J. Frey, Michael R. Hellige, Hellige, Lundberg, Meis, Erickson & Frey, Matthew T. E. Early, Maurice B. Nieland, Rawlings Neiland Probasco Killinger Ellwanger Jacobs, et al, Sioux City, IA, Damond R. Mace, J. Philip Calabrese, Leslie A. Morsek, Squire, Sanders & Dempsey LLP, Cleveland, OH, Moira Pietrowski, Ronald B. Lee, Roetzel & Andress, Akron, OH, Lee M. Seese, Paul E. Benson, Michael Best & Friedrich LLP, Milwaukee, WI, for Defendants.
TABLE OF CONTENTS
I. INTRODUCTION AND BACKGROUND ................................................1082
A. Procedural Background ..................................................1082
B. Factual Background .....................................................1083
1. Facts relevant to counts II and III ................................1083
2. Facts related to personal jurisdiction over FEMA and TRG ...........1085
II. LEGAL ANALYSIS .............................................................1086
A. Rule 12(b)(6) Standards ................................................1086
B. Fraud Claims ...........................................................1087
1. Pleading fraud under Rule 9(b) .....................................1087
2. Application of the Rule 9(b) pleading standards ....................1088
3. Leave to amend the complaint .......................................1090
C. Legal standards for personal jurisdiction ..............................1090
1. Long-arm authority .................................................1091
2. Minimum contacts ...................................................1091
a. Specific v. general jurisdiction ...............................1092
b. The five factor test ...........................................1093
3. Analysis ...........................................................1093
III. CONCLUSION .................................................................1096
On October 5, 2004, plaintiff Kevin Remmes filed an amended complaint against defendants International Flavors & Fragrances, Inc. ("IFF"), Givaudan Flavors Corp. ("Givauden"), Flavors of North America, Inc. ("FONA"), Sensient Flavors, Inc. ("Sensient"), the Flavor and Extract Manufacturers Association of the United States ("FEMA"), and the Roberts Group, L.L.C. ("TRG") alleging three causes of action. The three causes of action asserted are for negligence, fraudulent concealment and civil conspiracy. The Complaint alleges that this court has subject matter jurisdiction by virtue of diversity of citizenship of the parties, 28 U.S.C. § 1332.
Defendant Sensient filed a Motion to Dismiss Counts II and III of Plaintiff's Amended Petition (Doc. No. 64). Specifically, Sensient asserts that Count II, Remmes's fraudulent concealment claim, should be dismissed for failure to plead fraud with particularity, and that Count III, Remmes's civil conspiracy claim, should be dismissed because it is based entirely on the fraudulent concealment claim. Defendant IFF then filed its Joinder in Defendant Sensient's Motion to Dismiss Counts II and III of Plaintiff's Amended Petition (Doc. No. 68). This motion was followed by defendant Givaudan's Motion to Dismiss Counts II and III of Plaintiff's Amended Complaint (Doc. No. 72). In its motion, defendant Givaudan asserts the same grounds for dismissal raised in defendant Sensient's motion. Defendant FONA subsequently filed its own Motion to Dismiss Counts II and III of Plaintiff's Amended Petition (Doc. No. 77). In its motion, defendant FONA argues for dismissal on the same grounds raised in defendant Sensient's motion. Defendants FEMA and TRG then filed a joint Motion To Dismiss For Lack Of Personal Jurisdiction (Doc. No. 86). In their motion, defendants FEMA and TRG assert that they do not have sufficient minimum contacts with the State of Iowa so as to satisfy the Due Process Clause of the United States Constitution. After obtaining several extensions of time, plaintiff Remmes filed timely resistances to the defendants' motions. Defendant Sensient then filed a reply brief which defendants FONA and IFF separately joined. Defendants FEMA and TRG also filed a reply brief in response to plaintiff Remmes's resistance to their joint motion. Plaintiff Remmes subsequently filed a sur-reply brief in support of his position.
On a motion to dismiss, the court must assume all facts alleged in plaintiff Remmes's amended complaint are true, and must liberally construe those allegations. Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957). Therefore, the following factual background is drawn from plaintiff Remmes's amended complaint in such a manner.
Plaintiff Remmes resides in Sioux City, Iowa and was employed by the American Popcorn Company in Sioux City, Iowa. Defendant IFF is a New York corporation with its principal place of business in New York, New York. Givauden is a Delaware corporation with its principal place of business in Cincinnati, Ohio. FONA is an Illinois corporation with its principal place of business in Carol Steam, Illinois. Sensient is a Wisconsin corporation with its principal place of business in Indianapolis, Indiana. Defendants IFF, Givauden, FONA, and Sensient each design, manufacture, distribute and sell butter flavorings marketed to entities, including the American Popcorn Company.
The butter flavorings sold by defendants IFF, Givauden, FONA, and Sensient contain diacetyl and/or other volatile organic compounds that can cause human disease and injury. In the course of his employment at the American Popcorn Company, Remmes was exposed to butter flavorings designed, manufactured, distributed and sold by defendants IFF, Givauden, FONA, and Sensient. Remmes alleges that as a result of this exposure that he has suffered severe and permanent injury to his person including, bronchiolitis obliterans, severe and progressive damage to the respiratory system, and extreme shortness of breath. In addition, because of his exposure, Remmes's life expectancy has been significantly reduced.
In his fraudulent concealment claim, plaintiff Remmes alleges the following:
27. The Defendants knew, or should have known, that the butter flavorings and/or their constituents cause adverse health effects by at least 1991, including, but not limited to, the following:
a. Damage to human mucous membranes, and;
b. Respiratory disease.
28. Defendants knew or should have known certain information regarding the health hazards of butter flavorings and/or their constituents including, but not limited to, the following:
a. By at least 1991, the Defendants knew that diacetyl was a health hazard when inhaled;
b. By at least 1991, the Defendants knew that the level of diacetyl in areas where butter flavorings are used could and should be monitored through air sampling;
c. By at least 1991, the Defendants knew that diacetyl is a hazard to human mucous membranes;
d. By at least 1993, the Defendants knew their butter flavoring workers were experiencing "breathing problems."
e. By at least 1993, the Defendants knew that persons working around butter flavorings must wear full-face respirators;
f. By at least 1993, the Defendants knew that diacetyl is a severe respiratory hazard, causing, inter alia, respiratory tract injury; focal hyperemia of the lungs; atelectasis; bloody edema of the lungs; bronchial edema, and; emphysema;
g. By at least 1993, the Defendants knew the LC50 for diacetyl;
h. By at least 1994, the Defendants knew that diacetyl is a "potential respiratory exposure" for persons working around butter flavorings;
i. By at least 1994, the Defendants knew that diacetyl volatilizes above 83 F and that potential diacetyl volatilization must be minimized for worker safety;
j. By at least 1994, the Defendants recognized that butter flavorings should be mixed in a "closed system" to prevent an volatilization of diacetyl or other butter flavoring constituents into the air;
k. By at least 1995, the Defendants knew that their customers were experiencing severe health problems associated with their butter flavorings;
l. By at least 1995, the Defendants were specifically requested by their customers to "advise all butter users of the danger of butters" and specifically recommend what type of Personal Protective Equipment should be worn.
m. By at least 1995, the Defendants knew that diacetyl is a "harmful organic vapor";
n. By at least 1996, the Defendants were aware of all available research regarding diacetyl's effects on the mucous membranes, and;
o. By at least 1996, the Defendants knew...
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