Taylor v. Uniden Corp. of America, 85-345C(1).

• Decision Date: 29 November 1985
• Docket Number: No. 85-345C(1).,85-345C(1).
• Citation: 622 F. Supp. 1011
• Parties: Donald L. TAYLOR, Plaintiff, v. UNIDEN CORPORATION OF AMERICA, et al., Defendants.
• Court: U.S. District Court — Eastern District of Missouri

622 F. Supp. 1011

Donald L. TAYLOR, Plaintiff, v. UNIDEN CORPORATION OF AMERICA, et al., Defendants.

No. 85-345C(1).

United States District Court, E.D. Missouri, E.D.

November 29, 1985.

Steven G. Schumaier, Clayton, Mo., for plaintiff.

James E. McDaniel, St. Louis, Mo., Susan K. Chandler, Los Angeles, Cal., William J. Travis, Paul D. Kingsolver, St. Louis, Mo., for defendants.

MEMORANDUM

NANGLE, Chief Judge.

This cause is now before the Court on the separate motions of defendants Uniden Electronics of Hong Kong, Ltd. and Uniden Corporation of Japan to dismiss for lack of personal jurisdiction and the motion of Uniden Corporation of Japan to quash service of process.

I. PERSONAL JURISDICTION

Plaintiff, a citizen of Missouri, alleges injuries arising out of his use of a cordless telephone manufactured by defendants, corporations under the laws of Hong Kong and Japan respectively. Defendants argue that plaintiff's pleadings are insufficient to satisfy the Missouri long-arm statute because plaintiff fails to allege contacts with Missouri. Defendants also argue that the exercise of jurisdiction over them violates due process because plaintiff fails to demonstrate that defendants purposefully availed themselves of the privileges of conducting activities within Missouri. In responding to these arguments, plaintiff relies upon the "stream of commerce" theory of jurisdiction.

In passing on a motion to dismiss for lack of jurisdiction over a non-resident, a federal diversity court is required to engage in a two-step inquiry: first, whether defendant committed one of the acts enumerated in the long-arm statute; and second, whether the exercise of personal jurisdiction over defendant violates the due process clause of the fourteenth amendment. The Land-O-Nod Company v. Bassett Furniture Industries, Inc., 708 F.2d 1338 (8th Cir.1983); Scullin Steel Co. v. National Railway Utilization Corp., 676 F.2d 309, 312 (8th Cir.1982). Plaintiff, the party that is seeking to invoke federal jurisdiction, has the burden of establishing that jurisdiction exists, and this burden may not be shifted to the party challenging the jurisdiction. Mountaire Feeds, Inc. v. Agro Impex, S.A., 677 F.2d 651, 653 (8th Cir. 1982). While the facts are viewed in the light most favorable to the plaintiffs, "there must nonetheless be some evidence upon which a prima facie showing of jurisdiction may be found to exist...." Aaron Ferer & Sons Co. v. Diversified Metals Corp., 564 F.2d 1211, 1215 (8th Cir.1977) (citations omitted). See also Data Disc, Inc. v. Systems Technology Associates, Inc., 557 F.2d 1280, 1285 (9th Cir.1977) (plaintiff need only make a prima facie showing of jurisdictional facts through submission of affidavits plus discovery materials); Greycas, Inc. v. Anderson, 584 F.Supp. 894, 895-96 (E.D.Mo.1984); 4 Wright & Miller, Federal Practice and Procedure § 1068 at 250 (1969).

Missouri's Long-Arm statute provides in part:

1. Any person or firm, whether or not a citizen or resident of this state, or any corporation, who in person or through an agent does any of the acts enumerated in this section, thereby submits such person, firm, or corporation, and, if an individual, his personal representative, to the jurisdiction of the courts of this state as to any cause of action arising from the doing of any such acts:

(1) The transaction of any business within this state;

(2) The making of any contract within this state;

(3) The commission of a tortious act within this state;

(4) The ownership, use, or possession of any real estate situated in this state;

(5) The contracting to insure any person, property or risk located within this state at the time of contracting.

(6) Engaging in an act of sexual intercourse within this state with the mother of a child on or near the probable period of conception of that child.

2. ....

3. Only causes of action arising from acts enumerated in this section may be asserted against a defendant in an action in which jurisdiction over him is based upon this section.

Mo.Rev.Stat. § 506.500 (Supp.1984).

The due process clause of the fourteenth amendment places limits upon the power of a court to exercise personal jurisdiction over a non-resident defendant. The due process clause requires that a defendant have certain minimum contacts with the forum state such that the maintenance of the suit does not offend "traditional notions of fair play and substantial justice." International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945); Land-O-Nod, 708 F.2d at 1340. Accord World Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980); Kulko v. California Superior Court, 436 U.S. 84, 98 S.Ct. 1690, 56 L.Ed.2d 132 (1978). "In judging minimum contacts, a court properly focuses on `the relationship among the defendant, the forum, and the litigation.'" Calder v. Jones, 465 U.S. 783, 104 S.Ct. 1482, 1486, 79 L.Ed.2d 804 (1984) (citations omitted). See also Helicopteros Nacionales de Colombia S.A. v. Hall, 466 U.S. 408, 104 S.Ct. 1868, 1872, 80 L.Ed.2d 404 (1984). The defendant's contacts with the forum state must be purposeful and such that defendant "should reasonably anticipate being haled into court there." World Wide Volkswagen, 444 U.S. at 297, 100 S.Ct. at 567. See also Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1239, 2 L.Ed.2d 1283 (1958).

In this circuit, the due process standard has devolved into a consideration of five factors:

(1) the nature and quality of the contacts with the forum state; (2) the quantity of the contacts with the forum state; (3) the relation of the cause of action to the contacts; (4) the interest of the forum state in providing a forum for its residents; and (5) the convenience of the parties.

Aaron Ferer & Sons Co. v. Diversified Metals Corp., 564 F.2d 1211, 1215 (8th Cir. 1977). See Land-O-Nod, 708 F.2d at 1340. The first three factors are of primary importance and the last two are of secondary importance. Id.

The Court begins by examining the pleadings to determine whether they satisfy the requirements of the long-arm statute. Plaintiff alleges injuries resulting from use of defendants' telephone. Plaintiff also alleges that defendants manufacture, design, distribute, sell, and wholesale Uniden cordless telephones and that these telephones were placed into the stream of commerce of the United States reaching every state including Missouri. Defendants' argument rests upon a narrow, technical construction of the pleadings. Essentially, defendants argue that plaintiff's pleadings are insufficient because they fail to allege that defendants ever sold telephones in Missouri. The pleadings, defendants argue, demonstrate only an intention to market telephones in the United States.

It is the trial court's duty to construe all pleadings so as to do substantial justice. Fed.R.Civ.P. 8(f). Granted, plaintiff does not allege sales in Missouri explicitly. Nevertheless, plaintiff alleges sufficient facts to provide defendants adequate notice. Though the pleadings do not reveal the volume of sales within Missouri, it is reasonable to assume that substantial sales occurred here. See Gray v. American Radiator & Standard Sanitary Corp., 22 Ill.2d 432, 176 N.E.2d 761 (1961). Indeed, defendants have submitted affidavits stating that it sold two and one-half million cordless telephones in the United States. Thus, plaintiff's complaint alleges a tort within Missouri arising out of the sale of defendants' cordless telephone and, therefore, satisfies the Missouri long-arm statute.

In their second argument, defendants assert that plaintiff's allegations are insufficient because they fail to show any contact between defendants and Missouri. Defendants argue that an allegation that defendants placed their product in the stream of commerce does not lead to the conclusion that defendants purposefully availed themselves of the privileges afforded by Missouri law.

Both sides rely upon Worldwide Volkswagen, in which a fortuitous accident in Oklahoma involving a car sold in New York did not provide a sufficient contact between Oklahoma and the New York dealer. As the Supreme Court specified, a corporation must engage in activities within the forum seeking to assert jurisdiction such that the corporation could foresee being haled into court there. 444 U.S. at 297, 100 S.Ct. at 567. When the sale of a product arises from the efforts of the manufacturer or distributor to serve, directly or indirectly, the market for its product in certain states, it is not unreasonable to subject it to suit in one of those states if its allegedly defective merchandise has been the source of injury to its owner or to others. 444 U.S. at 297, 100 S.Ct. at 567. On the basis of this dicta, numerous courts have distinguished between retailers who restrict their sales to a local market and manufacturers and upstream distributors who seek a broader market for their product. See Hedrick v. Daiko Shoji Company, Ltd., Osako, 715 F.2d 1355 (9th Cir.1983); Nelson By Carson v. Park Industries Inc., 717 F.2d 1120 (7th Cir.1983); Noel v. S.S. Kresge Co., 669 F.2d 1150 (6th Cir.1982); Oswalt v. Scripto, Inc., 616 F.2d 191 (5th Cir.1980); Hutson v. Fehr Brothers, Inc., 584 F.2d 833 (8th Cir.1978) (Stephenson, J. dissenting); Rockwell Intern. Corp. v. Costruzioni Aeronautiche, 553 F.Supp. 328 (E.D.Pa. 1982); Asahi Metal Industry Co. v. Superior Court of Solano County, 39 Cal.3d 35, 702 P.2d 543, 216 Cal.Rptr. 385, 702 P.2d 543 (1985).

In Hedrick v. Daiko Shoji Company, Ltd., Osako, 715 F.2d 1355 (9th Cir.1983), the plaintiff, a longshoreman, sued for personal injuries resulting from a defective wire-rope splice manufactured by Daiko, a foreign defendant. As the Ninth Circuit held, the defendant performed a forum-related act when it produced a splice that it knew was destined for ocean-going vessels serving United States ports. 715 F.2d at 1358. The court distinguished between...