Wenche Siemer v. Learjet Acquisition Corp.

• Decision Date: 17 July 1992
• Docket Number: No. 91-4745,91-4745
• Citation: 966 F.2d 179
• Parties: WENCHE SIEMER, etc., et al., Plaintiffs-Appellants, v. The LEARJET ACQUISITION CORP., et al., Defendants-Appellees. Mayade Bahri HELWANI, etc., et al., Plaintiffs-Appellants, v. The LEARJET ACQUISITION CORP., et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 179

966 F.2d 179

WENCHE SIEMER, etc., et al., Plaintiffs-Appellants, v. The LEARJET ACQUISITION CORP., et al., Defendants-Appellees.

Mayade Bahri HELWANI, etc., et al., Plaintiffs-Appellants, v. The LEARJET ACQUISITION CORP., et al., Defendants-Appellees.

No. 91-4745.

United States Court of Appeals Fifth Circuit.

July 17, 1992.

Rehearing Denied Aug. 20, 1992.

Clinard J. Hanby and Susan A. Allinger, Essmyer & Hanby, Houston, Tex., for Siemer, et al.

Gerald L. Bracht, Mayor, Day & Caldwell, Houston, Tex., Walter J. Crawford, Jr., Wells, Peyton, Beard, Greenberg, Hunt, Crawford, Beaumont, Tex., and Hugh C. Griffin, and David J. Adams, Lord, Bissell & Brook, Chicago, Ill., for Learjet Corp.

Appeals from the United States District Court for the Eastern District of Texas.

Before HIGGINBOTHAM and DUHE, Circuit Judges, and HUNTER ¹, District Judge.

EDWIN F. HUNTER, Jr., District Judge:

Plaintiffs are the survivors of the co-pilot (Michael M. Grandclement) and of two of the passengers (Peter I. Siemer and Aladdine H. Bahri ²) on board Learjet N-711AF, which crashed on August 11, 1979 while en route from Athens, Greece to Jeddah, Saudi Arabia. The aircraft disappeared while traversing Egyptian airspace. The wreckage of the aircraft was discovered nearly eight (8) years later in the Egyptian desert.

In sum, plaintiffs' decedents disappeared from the face of the earth on August 11, 1979, when the plane they were flying disappeared over Egypt. Less than two years later, all of plaintiffs filed wrongful death actions in New York asserting that their decedents were dead. All of these cases were ultimately dismissed on forum non conveniens grounds. ³ Learjet was a defendant in one of plaintiffs' suits. Plaintiffs did not appeal.

Ten years later and eight years after being dismissed in New York, plaintiffs filed this second set of wrongful death actions in the United States District Court for the Eastern District of Texas. The district court granted Learjet's Motion to Dismiss on all grounds asserted: lack of in personam jurisdiction; improper venue; forum non conveniens; collateral estoppel; and limitations. Because we hold that the district court correctly ruled that it had no jurisdiction over the corporation in the cause of action asserted, we do not reach defendant's other lines of defense.

THE CONSTITUTIONAL REQUIREMENTS OF "DUE PROCESS"

Plaintiffs are all residents of Greece or other European countries. Decedents were all residents of Greece. The aircraft was permanently based, maintained and serviced in Greece. It was operated by a Greek company. It was not designed or manufactured in Texas. It was never owned by a Texas resident. It had never been repaired or serviced in Texas. Learjet is a Delaware corporation with its principal place of business in Kansas, where it designed, manufactured and sold its products. Plaintiffs urge us to hold, quite simply, that in state service on a designated corporate agent without more, satisfies the requirements of due process. This Court has never so held and we decline to do so now.

The extent of Learjet's contacts with Texas from the date it began operations to February 26, 1989, the date plaintiffs filed this suit, are revealed in the record. They had not had an employee, an officer or director, an interest in real property, a deposit in any financial institution, or a facility or office located within the state. All sales were made from products warehoused in Kansas or Arizona. Only slightly over one percent (1%) of Learjet's sales, consisting of spare parts went to buyers with Texas addresses. Learjet does hold a certificate from Texas giving it the right to do business in Texas. It does have an agent for process in Dallas, Texas. A wholly-owned, but separately operated, subsidiary transacts business in San Antonio, pursuant to a government contract. Advertisements have been placed in national journals that are distributed in Texas (as well as all other states), and Learjet has, on occasion, mailed information to prospective customers who happen to be located in Texas.

The fact that service is proper does not resolve the question as to "whether [the] plaintiff has demonstrated a sufficient basis for th[e] court's exercise of personal jurisdiction." Applewhite v. Metro Aviation, Inc., 875 F.2d 491, 494 (5th Cir.1989).

Whether jurisdiction in the sense of due process exists depends upon concepts of "fairness" and "convenience" and not upon mere compliance with procedural requirements of notice, nor even corporate "presence" within the state. International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945).

Because plaintiffs' causes of action, as alleged, in no way arose out of Learjet's contacts with Texas, plaintiffs had to show, in order to sustain jurisdiction, that Texas acquired general jurisdiction over Learjet. The leading Supreme Court case on general jurisdiction is Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984). There, the Texas Supreme Court determined that a foreign corporation could be sued in Texas in a suit arising out of a helicopter crash in Peru. The United States Supreme Court reversed. The reversal was premised upon a finding that the corporation's contacts were insufficient to establish general jurisdiction. The facts closely resemble those here. Neither plaintiffs nor decedents were or had been domiciled in Texas. The harm suffered did not occur in Texas. The alleged misconduct did not take place in Texas. The corporation had substantial contacts with Texas, id. at 410-11, 104 S.Ct. at 1869-71, but the Supreme Court of the United States held those contacts were insufficient to satisfy the requirements of the due process clause of the Fourteenth Amendment. Id. at 418-19, 104 S.Ct. at 1874-75.

The facts in Bearry v. Beech Aircraft Corp., 818 F.2d 370 (5th Cir.1987), provide a clear precedent for the resolution of this jurisdictional dispute. There, this Court found that general jurisdiction did not exist in Texas over another Kansas aircraft manufacturer, Beech Aircraft. The only significant factual differences between Bearry and this case are: (1) instead of being centered around sister states, Louisiana and Mississippi, the present case centers around foreign nations, Greece and Egypt; (2) Learjet has substantially less commerce involving Texas than the Bearry defendants had involving their respective forums; and (3) Learjet had appointed an agent for service of process in Texas. The first two items clearly reflect a much more tenuous jurisdictional connection to Texas by Learjet. While the last item, being qualified to do business, may on its face appear to be significant, it "is of no special weight" in evaluating general personal jurisdiction. Ratliff v. Cooper Laboratories, Inc., 444 F.2d 745, 748 (4th Cir.), cert. denied, 404 U.S. 948, 92 S.Ct. 271, 30 L.Ed.2d 265 (1971); accord Jones v. Family Inns, Inc. ⁴ ,1989 WESTLAW 57130 Civ.A. No. 89-0190 (E.D.La. May 23, 1989); In re Mid-Atlantic Toyota Antitrust Litig., 525 F.Supp. 1265, 1278 (D.Md.1981). Plaintiffs' cite no case and this Court has found none that supports the proposition that the appointment of an agent for process and the registration to do business within the state, without more, suffices to satisfy the criteria for the exercise of general jurisdiction.

The facts in Ratliff are remarkably similar to those here and its holding--that no general jurisdiction existed--if followed would be dispositive. The defendant had no office, bank account, or warehouse in South Carolina. Ratliff, 444 F.2d at 748. It owned no real or personal property there. It did not advertise there except through national journals. Just as Learjet had done in Texas, however, the defendant drug company had qualified to do business in South Carolina and had appointed an agent for service of process in the state. Moreover, the Ratliff defendant had maintained five "detail men" who lived in and promoted its products through personal contacts with doctors and drugstores throughout the forum state. Nonetheless, even the physical presence of this sales operation in South Carolina failed to tip the scale and subject the defendant to personal jurisdiction.

"We think the application to do business and the appointment of an agent for service to fulfill a state law requirement is of no special weight in the present context. Applying for the privilege of doing business is one thing, but the actual exercise of that privilege is quite another."

Id. at 748.

Plaintiffs tout Burnham v. Superior Ct., 495 U.S. 604, 110 S.Ct. 2105, 109 L.Ed.2d 631 (1990), as being dispositive of the jurisdictional issue. This is puzzling. Burnham did not involve a corporation and did not decide any jurisdictional issue pertaining to corporations.

Burnham, a New Jersey resident, during a visit to California to visit his children was served with a court summons and his estranged wife's divorce petition. She was a resident of California. The courts of that state rejected Burnham's contention that the Due Process Clause of the Fourteenth Amendment prohibited courts of that state from asserting personal jurisdiction over him. The Supreme Court unanimously affirmed and agreed that the rule allowing jurisdiction to be obtained over a non-resident by personal service in the forum state could not be held violative of due process under the circumstances of that case.

Justice SCALIA (with three Justices concurring) reasoned that jurisdiction based on physical presence, alone, constitutes due process because it is a continuing tradition of our legal system. Justice BRENNAN (with three Judges concurring), applied a more flexible approach. He had in essence this to say: Historical pedigree, although important, is not the only factor to be taken into account in establishing whether a jurisdictional rule satisfies due process, and that an independent inquiry into...