Williams v. Doe

• Decision Date: 18 August 2014
• Docket Number: No. 13–7022.,13–7022.
• Citation: 756 F.3d 777
• Parties: Norman WILLIAMS and Diane Howe, as Legal Representative of J.H., Appellants v. ROMARM, SA and Does Company Distributors, Appellees.
• Court: U.S. Court of Appeals — District of Columbia Circuit

756 F.3d 777

Norman WILLIAMS and Diane Howe, as Legal Representative of J.H., Appellants

v.ROMARM, SA and Does Company Distributors, Appellees.

No. 13–7022.

United States Court of Appeals,District of Columbia Circuit.

Argued Feb. 24, 2014.

Decided July 1, 2014.

Rehearing En Banc Denied Aug. 18, 2014.

Appeal from the United States District Court for the District of Columbia (No. 1:12–cv–00436).

Daniel M. Wemhoff argued the cause and filed the briefs for appellants.

Anthony M. Pisciotti argued the cause for appellees. With him on the brief were Jeffrey M. Malsch and James W. Porter III.

Before: BROWN, Circuit Judge, and EDWARDS and SILBERMAN, Senior Circuit Judges.

BROWN, Circuit Judge:

The choppy waters of the Supreme Court's “stream of commerce” doctrine have plagued lower courts for years. The three competing opinions in Asahi Metal Industry Co., Ltd., v. Superior Court of California, 480 U.S. 102, 107 S.Ct. 1026, 94 L.Ed.2d 92 (1987), each offered conflicting standards for exercising personal jurisdiction over a foreign manufacturer in a suit alleging injuries caused by its products in the forum state. Thankfully, we need not plumb those currents today because the Supreme Court recently clarified the minimum requirements applicable to the facts of this case.

In J. McIntyre Machinery, Ltd. v. Nicastro, ––– U.S. ––––, 131 S.Ct. 2780, 180 L.Ed.2d 765 (2011), Justice Breyer's narrow concurrence addressed the precise issue we face today and concluded a foreign corporation's sale to a distributor, without more, is insufficient to establish the minimum contacts necessary for a court to exert personal jurisdiction over the corporation, even if its product ultimately causes injury in the forum state. Nicastro compels us to affirm.

I

In March 2010, J.H., the son of Appellants Norman Williams and Diane Howe, was tragically murdered in a drive-by shooting in the District of Columbia. Investigation revealed the assault rifle used in the attack was manufactured by Appellee National Company Romarm S.A. (“Romarm”).Romarm is a foreign corporation and firearms manufacturer owned by the Romanian government and located in Bucharest, Romania. Romarm sells its products in Romania to an American distributor that imports them into the United States for sale. Assault weapons, like the one used to kill J.H., are prohibited in the District of Columbia. D.C. CODE § 7–2502.02(a)(6).

Two years after the shooting, Appellants filed a wrongful death action on behalf of J.H. in the United States District Court for the District of Columbia. The complaint asserted claims under the District of Columbia's Wrongful Death Statute, Survival Act, and Assault Weapons Manufacturing Strict Liability Act, in addition to common law claims based on negligence and public nuisance. Appellants argued the court had personal jurisdiction over Romarm through the District of Columbia's long-arm statute and subject matter jurisdiction through diversity of citizenship. Appellants also alleged subject-matter jurisdiction was not divested through the Foreign Sovereign Immunity Act, because of the “commercial activity” exception.

Romarm subsequently moved to dismiss Appellants' complaint under Federal Rules of Civil Procedure 12(b)(1) for lack of subject-matter jurisdiction, 12(b)(2) for lack of personal jurisdiction, and 12(b)(6) for failure to state a claim. Appellants then filed a motion for extension of time to respond, which the district court interpreted as a request for jurisdictional discovery. In February 2013, the district court denied Appellants' discovery request and granted Romarm's motion to dismiss, finding Appellants “failed to allege personal jurisdiction over ROMARM.” ¹Williams v. Romarm, No. 1:12–cv–00436, slip op. at 17 (D.D.C. Feb. 4, 2013), ECF No. 23.

II

Appellants have raised three primary challenges to the district court's ruling: (A) Romarm is not a “person” entitled to due process but is instead an agent of a foreign state; (B) Romarm's sales to the United States through a distributor establish sufficient contact with the District to comply with due process; and (C) the district court abused its discretion in rejecting Appellants' proposed limited jurisdictional discovery requests. We reject each challenge and affirm the district court.

A

First, like the district court, we must decide whether the Due Process Clause applies to Romarm. If so, Appellants would have to establish both statutory and constitutional personal jurisdiction. The answer to this preliminary question depends, in part, on how completely the Romanian government controls the corporate entity—i.e., is the corporation an inseparable part of the foreign state?

Under the Foreign Sovereign Immunities Act, “[p]ersonal jurisdiction over a foreign state shall exist as to every claim for relief over which the district courts have [subject matter] jurisdiction ... [and] where service has been made.” 28 U.S.C. § 1330(b). “In other words, under the [Act], subject matter jurisdiction plus service of process equals personal jurisdiction.”GSS Grp. Ltd. v. Nat'l Port Auth., 680 F.3d 805, 811 (D.C.Cir.2012) (citing Price v. Socialist People's Libyan Arab Jamahiriya, 294 F.3d 82, 95 (D.C.Cir.2002)). And because a foreign state is not a “person” protected by the Due Process Clause of the Fifth Amendment, minimum contacts between the foreign state and the forum state are not required for a court to constitutionally exert personal jurisdiction over the state. See GSS Grp. Ltd., 680 F.3d at 813 (citing Price, 294 F.3d at 96). The Act itself defines “foreign state” expansively to include any corporation that “is an organ of a foreign state ... or a majority of whose shares or other ownership interest is owned by a foreign state.” 28 U.S.C. § 1603(b)(2). Despite this broad statutory definition, however, constitutional protection will be accorded if a corporation “does not act as an agent of the state, and separate treatment would not result in manifest injustice[; if so, it] will enjoy all the due process protections available to private corporations,” which includes challenging the exercise of personal jurisdiction for insufficient minimum contacts. GSS Grp. Ltd., 680 F.3d at 815 (internal citations omitted); see also id. at 813, 817. Only when the foreign sovereign exercises control over the corporation to such a degree as to create a principal—agent relationship is the corporation considered part of the foreign state, rather than a “person” entitled to constitutional due process protection. Id. at 815.

The district court found that Romarm “consistently” represented itself as a separate entity from the Romanian State, despite its state ownership, and it rejected Appellants' arguments to the contrary. Williams v. Romarm, No. 1:12–cv00436, slip op. at 11 (D.D.C. Feb. 4, 2013), ECF No. 23. Thereafter, the district court proceeded to the due process minimum contacts analysis, and ultimately concluded the alleged contacts were insufficient to justify jurisdiction.

At oral argument, Appellants primarily challenged the district court's conclusion that Romarm is juridically independent from Romania and thus entitled to due process. Specifically, Appellants pointed to a claimed “concession” by Romarm that it is both owned and operated by Romania. This concession, they say, establishes Romarm as a state entity that is not entitled to due process.

However weighty this argument may be, we decline to consider it because Appellants failed to raise it in their briefs. Nowhere in their filings do Appellants cite to the document containing the alleged “concession” by Romarm on which they so heavily relied at oral argument. Nor do they ever explain (or argue in their briefs) the import of such a concession on personal jurisdiction. The majority of the opening brief argues Romarm's minimum contacts support personal jurisdiction. No attempt is made to couch the minimum contacts analysis as an alternative argument to the primary contention that due process never applied. In fact, Appellants' opening brief is actually inconsistent with their new argument, asserting “in its role as a ‘private actor,’ Romarm is granted due process guarantees ... necessary for the district court to assert personal jurisdiction.” Appellants' Br. at 5–6; see also id. at 13–14 (“Personal jurisdiction must satisfy: (1) District of Columbia's long-arm statute, and (2) the Due Process Clause.”). As Appellants conceded at oral argument, their new argument renders the “vast majority of the briefs ... irrelevant,” including their own. Oral Arg. Tape, No. 13–7022, at 14:08–14:20 (Feb. 24, 2014).

When we asked Appellants why this argument was not raised in the briefs, Appellantsclaimed they “discovered” Romarm's concession after the briefing deadline. Oral Arg. Tape, at 15:30–15:56. But this answer amounts to little, since the “discovered” concession is contained in the district court record that was always available to the parties. Additionally, the district court made a clear ruling on the due process issue, so Appellants easily could have challenged that issue in their briefs.

Whether it was an intentional strategy or a simple case of overlooking the record, Appellants cannot “sandbag” Romarm. See Sitka Sound Seafoods, Inc. v. NLRB, 206 F.3d 1175, 1181 (D.C.Cir.2000). Questions not presented and argued by the parties in a sequence affording appropriate consideration are forfeited, and we accordingly decline to rule on the issue since it was not properly raised. See, e.g., Ark. Las Vegas Rest. Corp. v. NLRB, 334 F.3d 99, 108 n. 4 (D.C.Cir.2003); Parsippany Hotel Mgmt. Co. v. NLRB, 99 F.3d 413, 418–19 (D.C.Cir.1996); C.J. Krehbiel Co. v. NLRB, 844 F.2d 880, 883 n. 1 (D.C.Cir.1988); Carducci v. Regan, 714 F.2d 171, 177 (D.C.Cir.1983); see alsoFED. R. APP. P. 28(a)(8)(A).²

B

Because we must assume, for the purposes of this appeal, the Due Process Clause applies to Romarm, we now address whether the district court could properly...