Willemsen v. Invacare Corp.

• Decision Date: 19 July 2012
• Docket Number: SC S059201.,CC 0902–01653
• Citation: 282 P.3d 867,352 Or. 191
• Court: Oregon Supreme Court
• Parties: Jeffrey WILLEMSEN, as Personal Representative of the Estate of Karlene J. Willemsen, and James Willemsen, Plaintiffs–Adverse Parties, v. INVACARE CORPORATION, a foreign corporation; United Seating & Mobility, a foreign limited liability company; Motion Concepts, Inc., a foreign corporation; Perpetual Motion Enterprises, Ltd., a foreign corporation; Pass & Seymour, Inc., a foreign corporation; Siemens Corporation, a foreign corporation; Siemens Industry, Inc., f/k/a/ Siemens Energy and Automation, Inc., a foreign corporation; Summers Group, Inc., dba Rexel, a foreign corporation; and Gaw Electric, Inc., an Oregon corporation, Defendants, and China Terminal & Electric Corp., a foreign corporation; CTE Tech Corp., a foreign corporation, Defendants–Relators.

352 Or. 191

282 P.3d 867

Jeffrey WILLEMSEN, as Personal Representative of the Estate of Karlene J. Willemsen, and James Willemsen, Plaintiffs–Adverse Parties,

v. INVACARE CORPORATION, a foreign corporation; United Seating & Mobility, a foreign limited liability company; Motion Concepts, Inc., a foreign corporation; Perpetual Motion Enterprises, Ltd., a foreign corporation; Pass & Seymour, Inc., a foreign corporation; Siemens Corporation, a foreign corporation; Siemens Industry, Inc., f/k/a/ Siemens Energy and Automation, Inc., a foreign corporation; Summers Group, Inc., dba Rexel, a foreign corporation; and Gaw Electric, Inc., an Oregon corporation, Defendants,andChina Terminal & Electric Corp., a foreign corporation; CTE Tech Corp., a foreign corporation, Defendants–Relators.

CC 0902–01653; SC S059201.

Supreme Court of Oregon, En Banc.

Argued and Submitted May 3, 2012.

Decided July 19, 2012.

Original proceeding in mandamus.^*

Jonathan M. Hoffman, Martin Bischoff Templeton Langslet & Hoffman LLP, Portland, argued the cause for Defendants–Relators. Joan L. Volpert, Portland, filed the brief for Defendants–Relators. With her on the brief were Jonathan M. Hoffman and Mary–Ann S. Rayburn.

Kathryn H. Clarke, Portland, argued the cause and filed the brief for Adverse Parties. With her on the brief was Jeffrey A. Bowersox.

Gregory S. Pitcher, Williams, Kastner & Gibbs PLLC, Portland, filed the brief for amicus curiae Product Liability Advisory Committee, Inc.

Lisa T. Hunt, Portland, filed the brief for amicus curiae Oregon Trial Lawyers Association.

KISTLER, J.

Defendant CTE Tech Corp. is a Taiwanese corporation that manufactures battery chargers.¹ Defendant Invacare Corporation is an Ohio corporation that manufactures motorized wheelchairs. CTE agreed to supply Invacare with battery chargers built to Invacare's specifications, which Invacare then sold with its motorized wheelchairs in Oregon and the rest of the United States. Plaintiffs brought this action against CTE after their mother died in a fire allegedly caused by a defect in CTE's battery charger. CTE moved to dismiss plaintiffs' claims against it on the ground that Oregon lacks personal jurisdiction over it. CTE reasoned that due process would permit an Oregon court to exercise personal jurisdiction over it only if CTE had purposefully availed itself of the privilege of doing business here. In CTE's view, the fact that it sold its battery chargers to Invacare in Ohio, which sold them together with its wheelchairs in Oregon, was not sufficient to meet that standard.

The trial court denied CTE's motion, and we denied CTE's petition for a writ of mandamus directing the trial court to vacate its ruling. CTE then filed a petition for certiorari with the United States Supreme Court. After the Court issued its decision in J. McIntyre Machinery, Ltd. v. Nicastro, 564 U.S. ––––, 131 S.Ct. 2780, 180 L.Ed.2d 765 (2011), the Court granted CTE's petition for certiorari, vacated our order, and remanded the case to us for further consideration in light of Nicastro. China Terminal & Elec. Corp. v. Willemsen, ––– U.S. ––––, 132 S.Ct. 75, 181 L.Ed.2d 1 (2011). On remand, we issued an alternative writ of mandamus to the trial court directing it to vacate its order denying CTE's motion to dismiss or show cause for not doing so. The trial court declined to vacate its order, and the parties have briefed the question whether, in light of Nicastro, Oregon courts may exercise personal jurisdiction over CTE. We hold that they may and accordingly dismiss the alternative writ.

Plaintiffs are Oregon residents.² Their mother was an Oregon resident, who purchased a motorized wheelchair manufactured by Invacare. The wheelchair came with a battery charger manufactured by CTE.³ On February 1, 2008, plaintiffs' mother died in her home as a result of a fire allegedly caused by a defect in CTE's battery charger. Plaintiffs brought this action against, among other defendants, Invacare and CTE. They alleged that the battery charger that CTE had manufactured and that Invacare had sold was a defective product. Alternatively, they alleged that CTE had been negligent in failing to “adequately design, inspect, test, [and] manufacture” the battery charger.

CTE moved to dismiss plaintiffs' claims against it for lack of personal jurisdiction. On that issue, the record shows that CTE is a Taiwanese corporation with its principal place of business in that country and that Invacare is an Ohio corporation with its principal place of business in that state. In 2004, CTE entered into a “master supply agreement” with Invacare to provide Invacare with battery chargers manufactured to Invacare's specifications.⁴ CTE warranted that its battery chargers would be “manufactured, packaged, labeled and stored in accordance with all applicable federal, state and local laws, ordinances, rules and regulations * * *.” CTE also agreed to certify annually that it had current certificates of insurance for “products and general liability coverage for bodily injury, personal injury and property damage in the amount of one million dollars ($1,000,000) per occurrence.” Finally, CTE promised to defend, indemnify, and hold Invacare harmless for any “claims, losses, damages, charges, [and] expenses * * * which may be made against [Invacare] or which [Invacare] may incur arising out of or concerning the [battery chargers].” In connection with that promise, CTE agreed to cooperate with Invacare “in the investigation of any actual or threatened claim, loss, damage, charge or expense.”

In 2006–2007, Invacare sold 1,166 motorized wheelchairs in Oregon that Invacare made in Ohio.⁵ Of those 1,166 wheelchairs, 1,102 wheelchairs came with battery chargers that CTE had manufactured and sold to Invacare.⁶ CTE received approximately $30,929 from Invacare for the battery chargers that Invacare provided to Oregon purchasers. Otherwise, CTE had no contacts with Oregon. As noted, CTE's principal place business is Taiwan. It does not maintain offices in Oregon and does not directly transact business here. It does not sell its products directly in Oregon, nor does it direct advertising material to customers in Oregon or directly solicit business here.

After considering the facts set out above, the trial court denied CTE's motion to dismiss for lack of personal jurisdiction. CTE filed a petition for a writ of mandamus with this court, which we denied. As noted, after the Court issued its decision in Nicastro, it granted CTE's petition for certiorari, vacated our order, and remanded the case to us for further consideration in light of Nicastro. On remand, the parties have briefed the question whether, in light of the decision in Nicastro, Oregon may assert personal jurisdiction over CTE. We turn to that question.

The dispute in this case is narrow. CTE does not contend that Oregon's long-arm statute does not reach its conduct. Cf. North Pacific v. Guarisco, 293 Or. 341, 351–52, 356, 647 P.2d 920 (1982) (holding that Oregon courts lacked personal jurisdiction over out-of-state defendants to adjudicate a cause of action that did not fall within the reach of the then-applicable long-arm statute). Rather, CTE recognizes that ORCP 4 L provides for personal jurisdiction over out-of-state defendants “in any action where prosecution of the action against [the] defendant in this state is not inconsistent with the Constitution of this state or the Constitution of the United States.” CTE argues, however, that the Due Process Clause does not permit Oregon to exercise personal jurisdiction over it when it has not purposefully availed itself of the privilege of conducting business in Oregon.

Plaintiffs, for their part, do not dispute that, under the Due Process Clause, a state may require an out-of-state defendant to appear in its courts only when the state has general or specific jurisdiction over that defendant. See Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. ––––, 131 S.Ct. 2846, 2851, 180 L.Ed.2d 796 (2011) (discussing those bases for asserting personal jurisdiction over out-of-state defendants). Plaintiffs do not contend that Oregon has general jurisdiction over CTE; that is, plaintiffs do not contend that CTE's “affiliations with [Oregon] are so ‘continuous and systematic’ as to render [CTE] essentially at home in the forum State.” 131 S.Ct. at 2851 (describing general jurisdiction); cf. Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 416–18, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984) (explaining when an out-of-state corporation's “continuous and systematic general business contacts” within a state will give rise to general jurisdiction).

Plaintiffs rely instead on specific jurisdiction, which “depends on an affiliatio[n] between the forum and the underlying controversy, principally, activity or an occurrence that takes place in the forum State and is therefore subject to the State's regulation.” See Goodyear Dunlop Tires, 131 S.Ct. at 2851 (explaining specific jurisdiction) (alteration in original; internal quotation marks omitted). “In contrast to general, all-purpose jurisdiction, specific jurisdiction is confined to adjudication of issues deriving from, or connected with, the very controversy that establishes jurisdiction.” Id. (internal quotation marks omitted). In this case, plaintiffs argue that the sale of Invacare wheelchairs and CTE battery chargers in Oregon provides sufficient minimum contacts with this state for Oregon courts to assert specific jurisdiction over CTE for injuries that its battery chargers allegedly caused here.

On that question, we note that, if CTE had sold its battery chargers directly in Oregon, there would be no dispute that Oregon could exercise personal jurisdiction over CTE for injuries that those chargers allegedly caused here. The issue in this case arises from the fact that CTE sold its battery chargers to Invacare in Ohio with the expectation that Invacare would sell its...