Sebring v. Air Equip. & Eng'g, Inc.

• Decision Date: 04 April 2013
• Docket Number: No. 02A05–1211–PL–566.,02A05–1211–PL–566.
• Citation: 988 N.E.2d 272
• Parties: John V. SEBRING, Appellant–Plaintiff, v. AIR EQUIPMENT AND ENGINEERING, INC., Donaldson Company, Inc., William W. Meyer and Sons, Inc., Newton Conveyors, Inc., and Emerson Power Transmission Corporation, Appellees–Defendants.
• Court: Indiana Appellate Court

988 N.E.2d 272

John V. SEBRING, Appellant–Plaintiff,

v.AIR EQUIPMENT AND ENGINEERING, INC., Donaldson Company, Inc., William W. Meyer and Sons, Inc., Newton Conveyors, Inc., and Emerson Power Transmission Corporation, Appellees–Defendants.

No. 02A05–1211–PL–566.

Court of Appeals of Indiana.

April 4, 2013.

David M. Lutz, David M. Lutz LLC, Fort Wayne, IN, Attorney for Appellant.

James P. Fenton, Eilbacher Fletcher, LLP, Fort Wayne, IN, Attorney for Appellee, Newton Conveyors, Inc.

OPINION

CRONE, Judge.

Case Summary

John V. Sebring was injured while using a dust collector at his workplace in Fort Wayne, Indiana. A component of the dust collector was manufactured by Newton Conveyors, Inc. (“NCI”), a Texas corporation. Sebring sued NCI and several other defendants in Indiana. NCI filed a motion to dismiss for lack of personal jurisdiction, which the trial court granted.

Sebring appeals the dismissal. NCI's role in the manufacturing process took place entirely within Texas, and the manufacturer of the final product unilaterally decided to ship the product to Indiana. Under these circumstances, NCI's contact with Indiana is too attenuated to support jurisdiction. Therefore, we affirm.

Facts and Procedural History

On March 22, 2012, in Allen Superior Court, Sebring filed a complaint, which alleged that several of his fingers were amputated due to the malfunction of a modular baghouse dust collector unit that he was using at his job at OmniSource. OmniSource is located in Fort Wayne, Indiana. The dust collector was manufactured by Donaldson Company, Inc. (“Donaldson”), which is incorporated under the laws of Delaware and has a plant in Nicholasville, Kentucky. Donaldson purchased a component part, a screw conveyor, from NCI, which is incorporated under the laws of Texas and has its sole place of business in Cleburne, Texas. Donaldson and NCI were among the defendants named in Sebring's complaint.

On June 12, 2012, NCI filed a motion to dismiss for lack of personal jurisdiction. NCI submitted a memorandum in support of its motion, along with an affidavit from NCI's president and documentation of the sale of the screw conveyor. The affidavit states that NCI does not have any employees or facilities in Indiana. Between March 1991 and October 1993, NCI “had a national advertising program via fax, portions of which may have been directed to Indiana,” but since then, NCI has not done any advertising in Indiana. Appellant's App. at 72. NCI does not have a telephone number or listing in Indiana. Between June 15, 2001, and January 31, 2003, NCI had an independent sales representative in Ohio whose territory included northern Indiana; however, NCI has no record of any sales being made in Indiana during this time. Since January 31, 2003, NCI has not had a sales representative or a distribution network in Indiana. NCI does not hold any Indiana business licenses, nor does it have any “ongoing business relationships with any Indiana residents.” Id. at 73.

The affidavit gives the following account of the transaction between NCI and Donaldson:

42. On January 31, 2005, Donaldson faxed from its Nicholasville, Kentucky facility, a purchase order to NCI requiring NCI to have the screw conveyor ready for shipment by March 9, 2005. This purchase order was accepted by NCI on January 31, 2005 by a fax transmission to Donaldson's facility in Nicholasville, Kentucky....

43. By agreement of NCI and Donaldson the shipping date was changed to March 25, 2005.

44. In addition, on January 31, 2005, Donaldson's purchase order informed NCI that the destination for the conveyor was “OmniSource, 7625 Vicksburg Pike, Fort Wayne, Indiana 46804.” The Donaldson purchase order specified that the shipment would be “F.O.B.¹ ORIGIN SHIPPING POINT,” which was NCI's facility in Cleburne, Texas.

45. On March 22, 2005, ATS truck line picked up the conveyor, F.O.B. at NCI's location in Cleburne, Texas, for shipment to OmniSource's location in Fort Wayne, Indiana....

46. All freight charges were paid by Donaldson and Donaldson chose the carrier, ATS truck line.

47. Ordinarily, Donaldson would have had NCI direct this conveyor to Donaldson's plant in Nicholasville, Kentucky. However, because Donaldson wished to expedite delivery of the goods to OmniSource's location, Donaldson arranged for the destination of the conveyor to be the OmniSource location in Fort Wayne, Indiana.

48. Donaldson is a manufacturer of dust collectors, and from time to time it has purchased conveyors from NCI to be used with Donaldson's dust collectors.

49. NCI's business records indicate that in the ten years 2002 to the present, NCI products have been shipped to Indiana only six times. Five of these shipments were made for Donaldson, and all such shipments were “F.O.B. Cleburne, Texas.” One of these shipments was the shipment which Donaldson directed to OmniSource in Fort Wayne, Indiana. In all five cases, Donaldson chose the carrier, and Donaldson paid all freight charges....

50. In addition, one of the six shipments was to the Romweber Company, located in Batesville, Indiana. This shipment was also F.O.B. Cleburne, Texas, and Romweber paid all freight charges....

51. The total revenue NCI derived from the conveyor Donaldson had NCI direct to Indiana in March 2005 was $10,286.00. Adding in the replacement parts shipped to Indiana for Donaldson over the past ten years and the Romweber shipment, NCI's total revenue from all products shipped to Indiana, including the March 2005 conveyor, over ten years was $20,427.00. This represents only .003% of NCI's total revenues over the past ten years.

52. NCI did not install or inspect the March 2005 conveyor at OmniSource and no employee, representative, or agent of NCI performed any work on the conveyor after it was delivered to Donaldson's carrier on March 22, 2005. NCI has never had any contact with OmniSource or the Plaintiff in this case, Mr. Sebring.

Id. at 74–75.

On October 8, 2012, the trial court granted NCI's motion to dismiss. Sebring appeals from this order.

Discussion and Decision

Personal jurisdiction is a question of law. LinkAmerica Corp. v. Albert, 857 N.E.2d 961, 965 (Ind.2006). Therefore, our review is de novo, and we do not defer to the trial court's legal conclusion as to whether personal jurisdiction exists. Id. However, to the extent that the issue of personal jurisdiction turns on disputed facts, the trial court's findings of fact are reviewed for clear error. Id.

Indiana Trial Rule 4.4(A) serves as Indiana's long-arm jurisdiction provision. Id. This provision extends to the limits of the United States Constitution; therefore, analysis of personal jurisdiction is reduced “to the issue of whether the exercise of personal jurisdiction is consistent with the Federal Due Process Clause.” Id. at 967.

The Due Process Clause of the Fourteenth Amendment requires that before a state may exercise jurisdiction over a defendant, the defendant must have “certain minimum contacts with [the state] such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’ ” Int'l Shoe Co. v. Wash., 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463, 61 S.Ct. 339, 85 L.Ed. 278 (1940)). If the defendant's contacts with the state are so “continuous and systematic” that the defendant should reasonably anticipate being haled into the courts of that state for any matter, then the defendant is subject to general jurisdiction, even in causes of action unrelated to the defendant's contacts with the forum state. See Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 415 n. 9, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984).

If the defendant's contacts with the forum state are not “continuous and systematic,” specific jurisdiction may be asserted if the controversy is related to or arises out of the defendant's contacts with the forum state. Id. at 414 & n. 8, 104 S.Ct. 1868. Specific jurisdiction requires that the defendant purposefully availed itself of the privilege of conducting activities within the forum state so that the defendant reasonably anticipates being haled into court there. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474–75, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985). A single contact with the forum state may be sufficient to establish specific jurisdiction over a defendant, if it creates a “substantial connection” with the forum state and the suit is related to that connection. McGee v. Int'l Life Ins. Co., 355 U.S. 220, 223, 78 S.Ct. 199, 2 L.Ed.2d 223 (1957). But a defendant cannot be haled into a jurisdiction “solely as a result of random, fortuitous, or attenuated contacts or of the unilateral activity of another party or a third person.” Burger King, 471 U.S. at 475, 105 S.Ct. 2174 (internal quotation marks omitted) (citing Helicopteros, 466 U.S. at 417, 104 S.Ct. 1868;Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 774, 104 S.Ct. 1473, 79 L.Ed.2d 790 (1984); World–Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 299, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980)).

Id.

Sebring concedes that NCI is not subject to general jurisdiction in Indiana; however, Sebring argues that there is specific jurisdiction pursuant to North Texas Steel Company, Inc. v. R.R. Donnelley & Sons Co., 679 N.E.2d 513 (Ind.Ct.App.1997)trans. denied, cert. denied (1998). In that case, R.R. Donnelley (“RRD”) entered into a contract with Associated Material Handling Industries, an Illinois corporation, for a material handling system including storage racks, sophisticated forklifts, conveyors, and other related equipment for RRD's facility in Warsaw, Indiana. Associated Material Handling subcontracted the storage rack design and manufacture to Frazier Industrial Company, a New Jersey corporation, which contracted with NTS, a Texas corporation, to fabricate the rack system according to Frazier's design. After completing the rack system, NTS shipped it to RRD's Warsaw...