Cappello v. Restaurant Depot, LLC ( 2023 )

United States Court of Appeals
For the First Circuit
No. 23-1368
ANTHONY CAPPELLO,
Plaintiff, Appellant,
v.
RESTAURANT DEPOT, LLC; D'ARRIGO BROS., CO.,
Defendants, Appellees,
CICCHETTI, LLC, d/b/a IL PANINO ITALIAN DELI; ADAM BROS.
FARMING, INC.,
Defendants.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW HAMPSHIRE
[Hon. Samantha D. Elliott, U.S. District Judge]
Before
Gelpí, Lynch, and Rikelman,
Circuit Judges.
Amanda E. Quinlan, with whom McLane Middleton, P.A. was on
brief, for appellant.
Scott T. Ober, with whom Matthew G. Lindberg, Patrick T.
Ciapciak, and Hassett & Donnelly, P.C. were on brief, for appellee
D'Arrigo Bros., Co.
Kenneth B. Walton, with whom Patricia B. Gary and Lewis
Brisbois Bisgaard & Smith LLP were on brief, for appellee
Restaurant Depot, LLC.
December 28, 2023
LYNCH, Circuit Judge. In November 2018, Anthony
Cappello, a New Hampshire resident, purchased and ate a salad from
Il Panino Italian Deli and Catering, a counter-serve deli in New
Jersey. Within days after Cappello had returned home to New
Hampshire he was diagnosed at a New Hampshire hospital with a life-
threatening E. coli infection which required several surgeries,
including the removal of his colon.
In April 2021, Cappello filed this lawsuit in the U.S.
District Court for the District of New Hampshire alleging that the
lettuce in the salad he ate had been contaminated with E. coli.
He sued Il Panino as well as the company that sold the lettuce to
Il Panino, Restaurant Depot, LLC; the lettuce distributor,
D'Arrigo Brothers, Co.; the lettuce grower, Adam Brothers Farming,
Inc.; and one hundred John Does as defendants. He later
voluntarily dismissed his claims against Il Panino, Adam Bros.,
and all John Does.
Restaurant Depot and D'Arrigo Bros., the remaining
defendants, each moved to dismiss for lack of personal
jurisdiction. The New Hampshire federal district court granted
Restaurant Depot's and D'Arrigo Bros.' motions to dismiss this
suit for lack of personal jurisdiction, reasoning that Cappello
had failed to demonstrate that his claims arose out of or related
to either defendant's contacts with New Hampshire. Cappello v.
Rest. Depot, LLC, No. 21-cv-356, 2023 WL 2588110 (D.N.H. Mar. 21,
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2023). Cappello appeals. We affirm, albeit on somewhat different
reasoning. Baskin-Robbins Franchising LLC v. Alpenrose Dairy,
Inc., 825 F.3d 28, 34 (1st Cir. 2016) (holding that reviewing court
can affirm "for any reason made evident by the record").
I. Background
The district court dismissed Cappello's case for lack of
personal jurisdiction using the prima facie method, that is,
without holding an evidentiary hearing and based solely on the
sufficiency of Cappello's evidentiary proffers. Cappello, 2023 WL
2588110, at *1. Accordingly, we "draw the relevant facts 'from
the pleadings and whatever supplemental filings (such as
affidavits) are contained in the record, giving credence to the
plaintiff's version of genuinely contested facts.'" Rodríguez-
Rivera v. Allscripts Healthcare Sols., Inc., 43 F.4th 150, 160
(1st Cir. 2022) (quoting Baskin-Robbins Franchising LLC, 825 F.3d
at 34).
On November 9, 2018, Cappello purchased and ate a takeout
Mediterranean salad from Il Panino, a counter-serve Italian deli
offering takeout and eat-in seating at a single location in
Fairfield, New Jersey.1 Il Panino prepared Cappello's salad using
Andy Boy brand romaine lettuce grown by Adam Bros. in California
which had been packaged and placed on a Restaurant Depot truck by
1 Cappello ate the takeaway salad in New Jersey; he
does not allege precisely where.
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D'Arrigo Bros. in California and ultimately sold by Restaurant
Depot to Il Panino in New Jersey. Cappello returned to his home
in Bedford, New Hampshire, no later than November 11, 2018.
Early in the morning on November 12, 2018, Cappello
developed abdominal cramps and bloody diarrhea. Cappello was
admitted at Catholic Medical Center ("CMC") in Manchester, New
Hampshire. Cappello tested positive for an infection of a
particular E. coli strain, known as E. coli O157:H7, that produces
Shiga toxin, an endotoxin also associated with dysentery. Cappello
experienced symptoms of hemolytic uremic syndrome (a condition in
which toxins cross from the intestines into the bloodstream), acute
kidney failure, and thrombocytopenia (low blood platelet count).
Surgeons at CMC removed Cappello's colon on November 16, 2018, and
Cappello has since required at least two additional procedures,
which both occurred at Massachusetts General Hospital in Boston,
Massachusetts.
From October 2018 to January 2019, the CDC, FDA, and
other public health agencies together received reports of sixty-
two E. coli O157:H7 infections, including Cappello's. The CDC and
FDA traced the infections back to products grown at the Adam Bros.
farm.
Cappello filed a complaint against the defendants in the
U.S. District Court for the District of New Hampshire on April 29,
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2021.2 Cappello brought claims3 for strict liability, negligence,
negligence per se, and breach of warranty. At the time Cappello
filed his complaint in New Hampshire on April 29, 2021, his three
tort claims would have been untimely in New Jersey under its two-
year statute of limitations for such claims. N.J. Stat. § 2A:14-
2.
Both D'Arrigo Bros. and Restaurant Depot asserted lack
of personal jurisdiction as an affirmative defense in answers to
Cappello's complaint filed on September 30, 2021, and October 19,
2021, respectively. The parties engaged in discovery. Restaurant
Depot and D'Arrigo Bros. each moved to dismiss for lack of personal
jurisdiction on April 29, 2022. Cappello then filed a new lawsuit
against Il Panino in New Jersey state court on November 7, 2022,
asserting only a breach of warranty claim. Il Panino filed a
third-party complaint against Restaurant Depot and D'Arrigo Bros.
in that lawsuit. That New Jersey lawsuit is currently in
discovery.
All parties filed affidavits and made evidentiary
proffers, and Cappello specifically requested an evidentiary
2 Cappello named Il Panino as Cicchetti, LLC d/b/a Il
Panino Italian Deli and Catering restaurant.
3 Cappello's complaint does not identify which
state's law provides the basis for his claims. In briefing before
the district court and at oral argument in this case Cappello took
the position that his claims are based on New Hampshire law.
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hearing. Cappello made evidentiary proffers of the following New
Hampshire contacts as to each defendant, which we credit for
purposes of our review. See Harlow v. Children's Hosp., 432 F.3d
50, 57 (1st Cir. 2005) (holding reviewing court takes "the
'properly supported proffers of evidence' . . . as true" (quoting
Boit v. Gar-Tec Prods., Inc., 967 F.2d 671, 675 (1st Cir. 1992)).
Restaurant Depot is a Delaware limited liability company
with its principal place of business in New York state. It
distributes restaurant supplies, including produce, to businesses
throughout the United States through a network of over a hundred
members-only warehouses. Restaurant Depot does not operate any
warehouses or own any property in New Hampshire. Restaurant Depot
offers memberships only to businesses, and applicants must submit
a business license or reseller's permit to secure a membership.
This restriction ensures compliance with zoning requirements for
the sites of its warehouses. Its members include businesses
located in all ten counties of New Hampshire. Restaurant Depot
sends its members -- including members located in New Hampshire -
- regular advertisements by post and email. Between 2017 and 2018
Restaurant Depot received $36,874,207 in revenue from sales to its
New Hampshire members.
Restaurant Depot does not ship products to its
customers; customers must pick products up from Restaurant Depot
warehouses. Restaurant Depot does have agreements with some third-
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party delivery partners who can purchase products on behalf of
Restaurant Depot members and then deliver them to the member.
Cappello alleges this includes third-party delivery partners who
delivered to members in New Hampshire. Restaurant Depot maintains
that it had no delivery partners who offered delivery of food
products into New Hampshire at the time the events giving rise to
this lawsuit occurred.
The other defendant on appeal, D'Arrigo Bros., is a
California corporation with its principal place of business in
California. D'Arrigo Bros. does not ship products directly into
New Hampshire, nor does it own any real property or conduct any
operations in New Hampshire. It ships products to six distribution
centers in Massachusetts, Connecticut, and Rhode Island, which
then make D'Arrigo Bros. produce available to stores and other
users, including in New Hampshire. Cappello offered no evidence
as to any D'Arrigo Bros. advertising activities.
The district court denied Cappello's request for an
evidentiary hearing and granted both Restaurant Depot's and
D'Arrigo Bros.' motions to dismiss in a written order on March 21,
2023. Cappello, 2023 WL 2588110, at *1. The district court
reasoned that Cappello's proffered evidence, even if true, was
insufficient to establish personal jurisdiction over either
defendant because the contacts Cappello cited were not
sufficiently related to Cappello's claims. Id. at *1, *5-6.
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This timely appeal followed.
II. Discussion
Cappello does not dispute the district court's choice to
use the prima facie method to determine whether Cappello had
carried his burden to demonstrate that personal jurisdiction
existed in his opening brief.4 See Vapotherm, Inc. v. Santiago,
38 F.4th 252, 257 (1st Cir. 2022) ("[A] district court 'may choose
from among several methods for determining whether the plaintiff
has met [this] burden.'" (quoting Adelson v. Hananel, 510 F.3d 43,
48 (1st Cir. 2007)). We thus review the district court's decision
de novo. Id."In determining whether a non-resident defendant is
subject to its jurisdiction, a federal court exercising diversity
jurisdiction 'is the functional equivalent of a state court sitting
in the forum state.'" Sawtelle v. Farrell, 70 F.3d 1381, 1387
4 In his reply brief Cappello argues
[t]he district court erroneously denied
Cappello an evidentiary hearing by finding
that "the court's reasoning rests on legal
conclusions drawn from uncontroverted facts
rather than a determination of any factual
dispute." Yet, the district court plainly
ignored the prima facie approach when it
determined where and when Cappello was
injured.
Cappello waived this argument by failing to develop it fully in
his opening brief. See Small Justice LLC v. Xcentric Ventures
LLC, 873 F.3d 313, 323 n.11 (1st Cir. 2017) ("[A]rguments developed
for the first time in a reply brief are waived.").
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(1st Cir. 1995) (quoting Ticketmaster-N.Y., Inc. v. Alioto, 26
F.3d 201, 204 (1st Cir. 1994)). Thus "to establish personal
jurisdiction over [D'Arrigo Bros.] and [Restaurant Depot],
[Cappello] must meet the requirements of both the [New Hampshire]
long-arm statute and the Due Process clause of the Fourteenth
Amendment."5 Rodríguez-Rivera, 43 F.4th at 160.
A. New Hampshire Long-arm Statute
As construed by the New Hampshire Supreme Court, "New
Hampshire's long-arm statute authorizes the exercise of personal
jurisdiction . . . to the extent permissible under the [f]ederal
Due Process [c]lause," In re Reddam, 180 A.3d 683, 687-88 (N.H.
2018), and we have generally treated it as "coextensive with the
outer limits of due process," Sawtelle, 70 F.3d at 1388 (citing
Phelps v. Kingston, 536 A.2d 740, 742-43 (N.H. 1987)); see also
Vapotherm, 38 F.4th at 258 (citing Phelps for the same conclusion).
We quickly dispose of Restaurant Depot's argument that
the New Hampshire long-arm statute is not satisfied here. The
statute covers, in relevant part, nonresidents who "transact[] any
business within [New Hampshire or] commit[] a tortious act within
[New Hampshire]." N.H. Rev. Stat. § 510:4. Restaurant Depot
5 In this diversity case where Cappello seeks to
establish personal jurisdiction over the defendants under Federal
Rule of Civil Procedure 4(k)(1)(A), we draw on due process
requirements as imposed by the Due Process clause of the Fourteenth
Amendment.
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argues that this statutory language is not satisfied here because
Restaurant Depot transacts no business within New Hampshire and
the allegedly tortious act here occurred in New Jersey, not New
Hampshire. The New Hampshire Supreme Court has held that its long-
arm statute is satisfied where in-state harm as a result of the
defendant's out-of-state actions was "reasonably foreseeable."
Mosier v. Kinley, 702 A.2d 803, 806 (N.H. 1997) (citing Phelps,
536 A.2d at 744) (holding long-arm statute satisfied where
individual discharged from Vermont hospital for transfer to
Massachusetts hospital was injured on road while passing through
New Hampshire because "it was reasonably foreseeable . . . that
the plaintiff would travel through New Hampshire [on the way to
Massachusetts] and could exacerbate his injury there"); see also
Kimball Union Acad. v. Genovesi, 70 A.3d 435, 441 (2013) (holding
long-arm statute satisfied where architect completed all work from
New Jersey office but defect in design arose once building was
constructed in New Hampshire).
The parties' arguments as to the location of Cappello's
injury conflate two common legal uses of the term "injury," one
synonymous with "breach" and the other synonymous with "harm."
The Supreme Court has suggested that being served or ingesting a
defective product in one place (i.e., injury as breach) and later
incurring damages elsewhere (i.e., injury as harm) could create a
sufficient "connection between the forum and the specific claims
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at issue" in either place. See Bristol-Myers Squibb Co. v.
Superior Ct. of Cal., 582 U.S. 255, 259, 264-65 (2017) (holding
plaintiffs had failed to establish personal jurisdiction over
defendants in California in part because they "did not allege that
they obtained [the drug at issue] through California physicians or
from any other California source; nor did they claim that they
were injured by [that drug] or were treated for their injuries in
California"). We add that neither the district court nor our
analysis turns on the place or places of injury.
We will assume arguendo in Cappello's favor that his
symptoms and treatment occurred and caused injury in New Hampshire
and that they were reasonably foreseeable in New Hampshire as a
result of contaminated lettuce consumed in New Jersey. Even so,
we hold that the exercise of personal jurisdiction over each of
the defendants in this case fails to satisfy a required element of
the due process analysis.
B. Due Process Requirements
To exercise personal jurisdiction over a nonresident
defendant, due process requires that the 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.'" Int'l Shoe Co. v. Washington, 326 U.S.
310, 316 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463
(1940)); see also Mallory v. Norfolk S. Ry. Co., 600 U.S. 122,
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137-41 (2023) (discussing Int'l Shoe in detail). Such contacts,
depending on their extent and nature, can establish general or
specific personal jurisdiction over a "defendant 'that has not
consented to suit in the forum.'" Mallory, 600 U.S. at 138
(emphasis removed) (quoting Goodyear Dunlop Tires Operations, S.A.
v. Brown, 564 U.S. 915, 927-28 (2011)). Cappello does not argue
general jurisdiction, he argues only that the defendants are
subject to specific personal jurisdiction in New Hampshire.
[P]laintiffs seeking to establish that a court
has specific personal jurisdiction over a
defendant must show that: (1) their claim
directly arises out of or relates to the
defendant's forum-state activities; (2) the
defendant's contacts with the forum state
represent a purposeful availment of the
privilege of conducting activities in that
state . . . ; and (3) the exercise of
jurisdiction is ultimately reasonable.
Scottsdale Cap. Advisors Corp. v. The Deal, LLC, 887 F.3d 17, 20
(1st Cir. 2018). We address the requirement of relatedness and
find that Cappello has failed to carry his burden as to this
necessary element.
We need not and do not resolve whether Restaurant Depot's
contacts with New Hampshire amounted to purposeful availment.
D'Arrigo Bros.' contacts with New Hampshire plainly do not. See,
e.g., Knox v. MetalForming, Inc., 914 F.3d 685, 691-92 (1st Cir.
2019) (requiring "regular flow or regular course of sale in the
forum" or "something more" than mere knowledge that a product
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placed in the stream of commerce could end up in a particular state
to demonstrate purposeful availment (quoting Plixer Int'l, Inc. v.
Scrutinizer GmbH, 905 F.3d 1, 10 (1st Cir. 2018)); see also J.
McIntyre Mach., Ltd. v. Nicastro, 564 U.S. 873, 891 (2011) (Breyer,
J., concurring in the judgment) (rejecting a stream of commerce
rule that would subject a defendant "to jurisdiction for a
products-liability action so long as it 'knows or reasonably should
know that its products are distributed through a nationwide
distribution system that might lead to those products being sold
in any of the fifty states.'" (quoting Nicastro v. McIntyre Mach.
Am., Ltd., 987 A.2d 575, 592 (N.J. 2010))). Nor do we address the
reasonableness of exercising personal jurisdiction over either
defendant in New Hampshire.
Cappello brings three tort claims and one contract
claim, each asserted against both D'Arrigo Bros. and Restaurant
Depot. Our analysis of relatedness differs for the contract and
the tort claims.
To demonstrate relatedness for his tort claims, Cappello
"must show a nexus between his claim and the defendants' forum-
based activities," Rodríguez-Rivera, 43 F.4th at 160, such that
the "plaintiff's claims . . . arise out of or relate to the
defendant[s'] contacts with the forum," id. (quoting Ford Motor
Co. v. Mont. Eighth Jud. Dist. Ct., 141 S. Ct. 1017, 1025 (2021)).
The parties agree that neither Restaurant Depot's nor D'Arrigo
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Bros.' contacts with New Hampshire were the but-for cause of
Cappello's claims. Cappello instead argues that the Supreme
Court's opinion in Ford Motor Co. established that but-for
causation is not necessary to a showing of relatedness and that
"some relationships will support jurisdiction without a causal
showing." 141 S. Ct. at 1026. From this he argues that the
respective relationships between New Hampshire and each of
Restaurant Depot and D'Arrigo Bros. are such relationships
supporting jurisdiction without a but-for causal showing. The
Ford court rejected Ford's argument that there was no causal link
to the forum states where the vehicles were not designed,
manufactured, or sold in those states and only later resales and
relocations by consumers had brought the vehicle to the forum
states. Id. The Court rejected Ford's "causation-only approach"
to there being a connection between the plaintiffs' suits and the
defendants' activities. Id. The concurring justices saw no need
to address the but-for issue, as the relatedness test was clearly
met under traditional criteria. See id. at 1032-34 (Alito, J.,
concurring in the judgment); id. at 1035-36 (Gorsuch, J.,
concurring in the judgment). We conclude the relationship of each
defendant with New Hampshire does not meet the standards
established in Ford.
As to Restaurant Depot, Cappello proffered evidence to
show that it had granted membership to New Hampshire businesses,
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that it had made over $36 million in sales to those members between
2017 and 2018, and that it had advertised to those New Hampshire
members by email and post.
Cappello has not proffered any evidence to show that
Restaurant Depot's New Hampshire contacts6 had anything to do with
a retail customer (a type of customer Restaurant Depot does not
and cannot serve) purchasing a salad at a restaurant in New Jersey.
Here, as in Vapotherm, Cappello's salad-derived E. coli infection
"do[es] not arise out of or relate to [Restaurant Depot]'s contacts
with New Hampshire. Instead, the [salad is] connected to
[Cappello] through [Restaurant Depot's] contacts in" New Jersey.
38 F.4th at 261.
Cappello mistakenly argues that he meets the relatedness
test under the Supreme Court's opinion in Ford. Cappello argues
that the Ford test is satisfied because "the type of product that
Mr. Cappello was injured by is the type of product that Restaurant
Depot reaps a benefit from in its business contacts in New
Hampshire." (Emphasis added.) We reject this expansive "type of
product" reasoning for the relatedness standard under Ford. As
Ford stated, the minimum contacts test instead arises out of due
6Cappello offers no evidence and does not argue that
he was -- or was even eligible to become -- a Restaurant Depot
member. Nor does he offer to show that he ever received -- or was
even a part of the target demographic for -- Restaurant Depot's
New Hampshire-directed advertisements.
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process concerns of "'reasonable[ness] . . .' and '. . .
traditional notions of fair play and substantial justice.'" 141
S. Ct. at 1024 (quoting Int'l Shoe, 326 U.S. at 316-17).
In Ford the nationwide manufacture and retail sale of
vehicles (including parts) and Ford's support in the forum states
for a secondary market of used Ford vehicles satisfied these
concerns in ways that the wholesale distribution of lettuce to a
non-forum state simply cannot and does not. We name just a few
relevant differences between the nature of the businesses at issue
here and Ford's. Here Restaurant Depot did not cultivate a market
for its food products in the forum state or have the product
malfunction there. Nor did Restaurant Depot "extensively
promote[]" sales or service of lettuce in New Hampshire. Id. at
1032. Personal automobiles and like vehicles serve to make their
consumers mobile (such as between jurisdictions); lettuce does
not. Personal vehicles are durable goods. Lettuce is not a
durable good; it is meant to be consumed once. Personal vehicle
manufacturers like Ford provide service centers and aftermarket
products to "ensure[] that consumers can keep their vehicles
running long past the date of sale" and to ensure their convenient
use by the ultimate consumer throughout the country, id. at 1022-
23; lettuce distributors do not. Personal vehicles are also the
subject of a nationwide market of consumer-to-consumer sales;
lettuce is not.
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In Ford the Ford Motor Company engaged in forum-state
contacts -- individual car drivers owning and operating Ford
vehicles within the forum state when the vehicle was originally
purchased elsewhere -- from which the lawsuit arose. Ford, 141 S.
Ct. at 1028-29. Here, Cappello proffers no evidence that
Restaurant Depot's New Hampshire contacts included contacts --
retail consumption of a salad outside the forum state -- like those
from which this lawsuit arose. There is insufficient relatedness
as to the tort claims against Restaurant Depot.
As to the tort claims against D'Arrigo Bros., Cappello
relies on even weaker grounds: his proffered evidence that it
distributed lettuce products to the New England area with the
knowledge that some of those products might end up in New
Hampshire. That knowledge that its lettuce might or might not end
up in a salad in New Hampshire is insufficient to show relatedness
and has nothing to do with retail consumption of a salad from an
unconnected restaurant in New Jersey. Ford does not provide any
support to Cappello. Nothing about D'Arrigo Bros.' knowledge its
lettuce could end up in a salad in New Hampshire was in any way
related to the consumption of a salad in New Jersey.
We next turn to the relatedness analysis for Cappello's
contract-based claims. Here he must show "the defendant's activity
in the forum state was instrumental either in the formation of the
contract or its breach." Vapotherm, 38 F.4th at 258-59 (quoting
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Adelson, 510 F.3d at 49). We conclude Cappello has failed to make
this showing as to each defendant.
Cappello's contract claim is a warranty of
merchantability claim. Cappello argues that personal jurisdiction
over the defendants for this claim is proper because the New Jersey
and New Hampshire warranties of merchantability are identical.
Even if true, we do not see why that would make Restaurant Depot's
or D'Arrigo Bros.' contacts with New Hampshire instrumental to the
formation of any contract Cappello entered into when he purchased
the salad, or to the breach of any such contract. See id. He
further argues that the breach of warranty occurred in New
Hampshire where he experienced his symptoms. This does not
establish that the defendants' New Hampshire contacts were
instrumental to that alleged breach.
III. Conclusion
Here the denial of personal jurisdiction in New
Hampshire best serves the interests of "interstate federalism."
Ford, 141 S. Ct. at 1025 (quoting World-Wide Volkswagen Corp. v.
Woodson, 444 U.S. 286, 293 (1980)). We affirm.
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