Terzano v. Pfc

• Decision Date: 28 November 1997
• Docket Number: No. CIV. 96-2592(HL).,CIV. 96-2592(HL).
• Citation: 986 F.Supp. 706
• Parties: Andrea TERZANO, et al., Plaintiffs, v. PFC, et al., Defendants.
• Court: U.S. District Court — District of Puerto Rico

986 F.Supp. 706

Andrea TERZANO, et al., Plaintiffs, v. PFC, et al., Defendants.

No. CIV. 96-2592(HL).

United States District Court, D. Puerto Rico.

November 28, 1997.

COPYRIGHT MATERIAL OMITTED

Carmen R. De-Jesus, Carolina, PR, for Andrea Terzano, Carmen Christina Terzano, Luis A. De Jesus, Carmen M. De Jesus, plaintiffs.

Carmen R. De Jesus, Carolina, PR, pro se.

Ramon H. Vargas, Vargas & Rive, San Juan, PR, for PFC, defendant.

OPINION AND ORDER

LAFFITTE, District Judge.

Before the Court is Defendant PFC's motion to dismiss this claim for lack of personal jurisdiction. Plaintiff Andrea Terzano is a minor. Her mother, who is also a plaintiff, is bringing this suit on Andrea's behalf. Andrea's sister and grandparents are also plaintiffs. This is a products liability case based on an alleged faulty luggage cart. Jurisdiction is based on diversity of the parties.¹ Plaintiffs make the following allegations in their amended complaint: all plaintiffs are Puerto Rico residents; PFC, the manufacturer of the cart, is a New York corporation; in April 1996, Andrea, her mother, and her grandfather were traveling from Miami to Puerto Rico; at the airport in Miami, Andrea was fastening items on the luggage cart when one of the cart's elastic cords snapped back and hit her in the face, and the hook of the cord hit her in the mouth, knocking out one of her front teeth, chipping the other one, and causing her to fall back onto the pavement. Plaintiffs claim that the cart's cord was a lethal instrument, that PFC failed to warn of the product's risk, and that PFC breached an express warranty that the cart could be safely used. They further claim that this injury to Andrea caused her to undergo extensive dental treatment and to suffer extreme pain and mental anguish. The other plaintiffs also claim to have suffered mental anguish as a result.

In its motion to dismiss, PFC has submitted evidence that Andrea's mother purchased the luggage cart at a K-Mart in New Jersey.² Plaintiffs in their opposition confirm that the cart was purchased there.³ PFC claims that it has no office or agents in Puerto Rico. It further claims that the cart was manufactured in New York, that the injuries were suffered in Miami, and that therefore this Court does not have personal jurisdiction over PFC. In their opposition, Plaintiffs claim that PFC has waived this defense. Plaintiffs further claim that because PFC's product is sold at K-Mart stores in Puerto Rico, PFC is conducting systematic and continuous activities in Puerto Rico and is therefore purposely availing itself of the benefits of doing business here. In their opposition, however, Plaintiffs have submitted no evidence to support these contentions. The only evidence that PFC's products are sold in Puerto Rico is PFC's acknowledgment that it sells similar products in Puerto Rico.⁴ For the reasons set forth below, the Court grants PFC's motion and dismisses this claim.

DISCUSSION

1. The waiver issue

Plaintiffs claim that PFC's participation in this case constituted a waiver of the defense of a lack of personal jurisdiction. Plaintiffs filed their complaint on December 17, 1996.⁵ On February 5, 1997, PFC filed its first motion in the case, a request for an extension of time to answer or otherwise plead.⁶ PFC's next filing was its answer on March 24, 1997, in which PFC raised as an affirmative defense the lack of personal jurisdiction.⁷ On April 8, 1997, PFC filed its motion to dismiss for lack of personal jurisdiction. Plaintiffs claim that in February 1997, PFC began to conduct discovery, including the mailing of interrogatories and the deposing of one of the plaintiffs. Plaintiffs argue that this participation constitutes a waiver of the personal jurisdiction defense.

The defense of personal jurisdiction may be waived by conduct, express submission, or a failure to raise the defense. Precision Etchings & Findings v. LGP Gem, Ltd., 953 F.2d 21, 25 (1st Cir.1992). Rule 12(h)(1) provides that the defense of lack of personal jurisdiction is waived if it is not raised in a motion or included in a responsive pleading. Fed.R.Civ.P. 12(h)(1); Marcial Ucin, S.A. v SS Galicia, 723 F.2d 994, 997 (1st Cir.1983). A defendant who files a responsive pleading without objecting to the court's personal jurisdiction has consented to the court's jurisdiction over him. Pilgrim Badge & Label Corp. v. Barrios, 857 F.2d 1, 3 (1st Cir.1988). A general appearance does not constitute a waiver of the defense; however, once the defendant appears, he must raise the personal jurisdiction defense in a timely fashion. Marcial Ucin, 723 F.2d at 997.

In the present case, PFC filed an answer a little over three months after Plaintiffs filed their complaint. In the answer PFC raised the lack of personal jurisdiction as an affirmative defense. Two weeks later, PFC filed its motion to dismiss. The Court finds that PFC raised the personal jurisdiction in a timely fashion. See Continental Bank, N.A. v. Meyer, 10 F.3d 1293, 1297 (7th Cir.1993) (Defendants' participation in litigation for two-and-a-half years before raising the personal jurisdiction defense constituted waiver); Marcial Ucin, 723 F.2d at 997 (Raising the defense four years after filing an appearance constituted waiver). Plaintiffs' claim that PFC waived the personal jurisdiction defense is meritless.

2. The personal jurisdiction issue

A plaintiff always has the burden of establishing that the forum court has personal jurisdiction over the defendant. Rodriguez v. Fullerton Tires Corp., 115 F.3d 81, 83 (1st Cir.1997). In ruling on this issue, the court has a number of different standards by which it may review the record to determine whether the plaintiff has met her burden. See Boit v. Gar-Tec Products, Inc., 967 F.2d 671, 674-78 (1st Cir.1992). When a court holds an evidentiary hearing on the issue, one of two standards applies: either plaintiff must demonstrate a likelihood of the existence of all facts necessary to establish personal jurisdiction or plaintiff must show by a preponderance of the evidence the facts which support personal jurisdiction. Foster-Miller, Inc. v. Babcock & Wilcox Canada, 46 F.3d 138, 145-47 (1st Cir.1995); Mohajer v. Monique Fashions, 945 F.Supp. 23, 26 (D.P.R.1996).

A third method often used at the early stages of litigation is the prima facie standard. Rodriguez, 115 F.3d at 83-84. Under this least taxing of the standards, a plaintiff must make a showing as to each fact required to satisfy both the local forum's long-arm statute and the Constitution's due process clause. Id. The district court does not sit as a factfinder; rather, "it ascertains only whether the facts duly proffered, fully credited, support the exercise of personal jurisdiction." Id. at 84. To make a prima facie showing, the plaintiff may not rest on unsupported allegations in the pleadings; instead, she must adduce evidence of specific facts which establish personal jurisdiction. Foster-Miller, 46 F.3d at 145; Boit, 967 F.2d at 675. In the present case, no party has requested an evidentiary hearing and the litigation is in its early stages. Moreover, the First Circuit has ruled that unless the district court otherwise informs the parties, it is to be understood that the prima facie standard will be used. See Rodriguez, 115 F.3d at 84. Accordingly, the Court will employ the prima facie standard in ruling on the motion to dismiss.

Personal jurisdiction relates to a court's power over the defendant. There are two types of personal jurisdiction: general and specific. Pritzker v. Yari, 42 F.3d 53, 59 (1st Cir.1994). General jurisdiction exists when the lawsuit is not directly based on the defendant's contacts with the forum, but when the defendant has engaged in activity in the forum which is unrelated to the suit and which is systematic and continuous. Foster-Miller, 46 F.3d at 144 (quoting United Elec., Radio and Mach. Workers of America v. 163 Pleasant Street Corp., 960 F.2d 1080, 1088 (1st Cir.1992)). In the case before the Court, there is no evidence that PFC has engaged in continuous and systematic activity in Puerto Rico. The only evidence of PFC's presence in Puerto Rico is its admission that it sells similar luggage products in Puerto Rico.⁸ It is unclear whether PFC is referring to the same type of cart as the one which allegedly injured Andrea or to other luggage products. In any case, this scant evidence is insufficient to establish general jurisdiction. See Foster-Miller, 46 F.3d at 144.

The second type of personal jurisdiction — specific jurisdiction — requires a plaintiff to establish two conditions: first, that the forum has a long-arm statute which purports to grant jurisdiction over the defendant; and second, that the court's exercise of personal jurisdiction over the defendant pursuant to that statute would comport with the Constitution's strictures. Id. With regard to this first condition, the Puerto Rico long-arm statute provides in pertinent part that a court in Puerto Rico has jurisdiction over a person not domiciled in Puerto Rico if the action arises because that person "[t]ransacted business in Puerto Rico personally or through an agent." P.R. Laws Ann. tit. 32, app. III, R.4.7(a)(1) (1983). This statute extends personal jurisdiction as far as the United States Constitution will permit. Pritzker, 42 F.3d at 60. This statute purports to grant jurisdiction over PFC. Accordingly, the first condition has been met.

The second condition requires substantially more analysis. The question of whether PFC transacted business as defined by Puerto Rico's long-arm statute depends on whether Plaintiffs can establish that PFC has sufficient minimum contacts with Puerto Rico. See id. The following three-part test has been developed for making this determination:

First, the claim underlying the litigation must directly arise out of, or relate to, the defendant's forum-state activities. Second, the defendant's in-state contacts must represent a...