Danny Patterson v. Aker Solutions Incorporated, et ( 2016 )

Case: 15-30690 Document: 00513545911 Page: 1 Date Filed: 06/13/2016
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
No. 15-30690 FILED
June 13, 2016
Lyle W. Cayce
DANNY PATTERSON, Clerk
Plaintiff - Appellant
v.
AKER SOLUTIONS INCORPORATED; FMC TECHNOLOGIES,
INCORPORATED; FMC EURASIA, L.L.C.; AKER SUBSEA AS,
Defendants - Appellees
Appeals from the United States District Court
for the Eastern District of Louisiana
USDC No. 2:13-CV-337
Before HIGGINBOTHAM, DENNIS, and CLEMENT, Circuit Judges.
EDITH BROWN CLEMENT, Circuit Judge:
In this personal injury suit arising out of events occurring in waters off
the coast of Russia, Danny Patterson appeals the district court’s dismissal of
defendant Aker Subsea AS (“Aker Subsea”), for lack of personal jurisdiction.
For the following reasons, we AFFIRM.
I.
Patterson, a U.S. citizen, allegedly sustained a knee injury while
working aboard the M/V SIMON STEVIN, a Luxembourg-flagged vessel that
was located off the coast of Russia. Patterson was working for Blue Offshore
Projects BV (“Blue Offshore”) on a project to install subsea production
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equipment in a gas and condensate field. While aboard the M/V SIMON
STEVIN, Patterson claims that he was struck by a cable and was injured.
Patterson sued Blue Offshore and two other companies involved in the
project, Aker Solutions, Inc. (“Aker Solutions”) and FMC Technologies, Inc., in
the Eastern District of Louisiana. Patterson alleged that the defendants’
negligence caused his injuries. Patterson amended his complaint and added
more defendants including Aker Subsea, FMC Kongsberg Subsea AS (“FMC
Kongsberg”), and FMC Eurasia, LLC. Aker Subsea and FMC Kongsberg
separately moved to dismiss for lack of personal jurisdiction. The district court
allowed Patterson additional time to conduct jurisdictional discovery. After
completion of the jurisdictional discovery, the district court found that neither
specific nor general personal jurisdiction existed over Aker Subsea or FMC
Kongsberg. Thus, it granted their motions and dismissed them from the suit.
Patterson sought to certify the district court’s dismissal order as a final
judgment under Federal Rule of Civil Procedure 54(b). Simultaneously, he
appealed the dismissal to this court, arguing that the district court has general
personal jurisdiction over both Aker Subsea and FMC Kongsberg. We stayed
the appeal pending the district court’s determination of the 54(b) motion. The
same day, we granted Patterson’s unopposed motion to dismiss FMC
Kongsberg. After the district court certified its order as final, we lifted the stay.
We now consider whether the district court erred in dismissing Aker Subsea
under Rule 12(b)(2). 1
1 Because the district court certified its dismissal order as a final judgment, this court
has jurisdiction over the appeal under 28 U.S.C. § 1291. See Crowley Mar. Corp. v. Panama
Canal Comm’n, 849 F.2d 951, 953-54 (5th Cir. 1988) (holding that where a premature notice
of appeal is filed, a subsequent Rule 54(b) certification is sufficient to validate the notice of
appeal).
2
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II.
We review de novo the district court’s Rule 12(b)(2) dismissal for lack of
personal jurisdiction. Revell v. Lidov, 317 F.3d 467, 469 (5th Cir. 2002). “The
plaintiff bears the burden of establishing jurisdiction, but need only present
prima facie evidence.” Id. We “must accept the plaintiff’s uncontroverted
allegations, and resolve in [his] favor all conflicts between the facts contained
in the parties’ affidavits and other documentation.” Id. (alteration in original)
(internal quotation marks omitted).
III.
Patterson argues that the district court erred by dismissing Aker Subsea
because, in his view, it has sufficient contacts with the United States to
establish general personal jurisdiction under Federal Rule of Civil Procedure
4(k)(2). 2 Patterson contends that over a three-year period, Aker Subsea entered
into eleven secondment agreements 3 whereby it would assign its employees to
an American affiliate in Houston, Texas. Under the secondment agreements,
the employees sent to the United States remained employees of Aker Subsea.
To Patterson, this shows continuous and systematic contacts in the United
States sufficient to assert general jurisdiction over Aker Subsea.
Federal Rule of Civil Procedure 4(k)(2) 4 “provides for service of process
and personal jurisdiction in any district court for cases arising under federal
2 Patterson does not argue on appeal that specific personal jurisdiction exists over
Aker Subsea.
3 The term secondment means “the detachment of a person . . . from his regular
organization for temporary assignment elsewhere.” Webster’s Third New Int’l Dictionary
(10th ed. 2014). Here, the secondment agreements sent workers from Aker Subsea in Norway
to Aker Solutions, an affiliate, in Houston. Aker Subsea would maintain all of the benefits of
the seconded employee in Norway, including Norwegian Social Security, home country
pension, and insurance. Aker Solutions was responsible for the day-to-day instruction of the
seconded employee.
4 Rule 4(k)(2) states that “[f]or a claim that arises under federal law, serving a
summons or filing a waiver of service establishes personal jurisdiction over a defendant if:
3
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law where the defendant has contacts with the United States as a whole
sufficient to satisfy due process concerns and the defendant is not subject to
jurisdiction in any particular state.” Adams v. Unione Mediterranea Di Sicurta,
364 F.3d 646, 650 (5th Cir. 2004). Here, the dispute is whether Aker Subsea
has sufficient contacts with the United States to satisfy due process.
“The due process required in federal cases governed by Rule 4(k)(2) is
measured with reference to the Fifth Amendment, rather than the Fourteenth
Amendment. That is, Rule 4(k)(2) requires us to consider [Aker Subsea’s]
contacts with the United States as a whole . . . .” Submersible Sys., Inc. v.
Perforadora Cent., S.A. de C.V., 249 F.3d 413, 420 (5th Cir. 2001). Thus, to
assert general personal jurisdiction under Rule 4(k)(2), Aker Subsea’s contacts
with the United States must be so continuous and systematic as to render it
essentially at home in the United States. See id.; Daimler AG v. Bauman, 134
S. Ct. 746, 761 (2014) (“[T]he inquiry under [Goodyear Dunlop Tires
Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011)] is not whether a foreign
corporation’s in-forum contacts can be said to be in some sense ‘continuous and
systematic,’ it is whether that corporation’s ‘affiliations with the State are so
‘continuous and systematic’ as to render [it] essentially at home in the forum
State.’”).
The proper forum for exercising general jurisdiction over a corporation
is one in which a corporation is fairly regarded at home. Goodyear, 564 U.S. at
924 (citing Brilmayer et al., A General Look at General Jurisdiction, 66 Tex. L.
Rev. 721, 782 (1988) (identifying place of incorporation and principal place of
business as paradigm bases for the exercise of general jurisdiction)). Both Aker
Subsea’s place of incorporation and principal place of business are in Norway.
(A) the defendant is not subject to jurisdiction in any state’s courts of general
jurisdiction; and (B) exercising jurisdiction is consistent with the United States Constitution
and laws.”
4
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Thus, to exercise general jurisdiction here, these facts must yield what the
Supreme Court has described as the “exceptional case.” 5
The record contains no evidence that Aker Subsea had any business
contacts with the United States except for eleven secondment agreements.
Sending eleven employees to the United States over a brief period does not rise
to the level of making Aker Subsea at home in the United States. The Supreme
Court has found a sufficient basis for the exercise of general jurisdiction over
a non-resident defendant in only one modern case—Perkins v. Benguet Consol.
Mining Co., 342 U.S. 437 (1952)—and Aker Subsea’s contacts with the United
States do not come close to the level of contacts there.
In Perkins, the Court found that the defendant, a Philippine corporation,
could be subject to general personal jurisdiction in Ohio based on its extensive
contacts within the state. 342 U.S. at 448-49. Due to World War II, the
corporation moved certain operations from the Philippines to Ohio. The
corporation’s contacts with Ohio included: maintaining an office, keeping
company files there, corresponding from Ohio about business and employees,
paying salaries to the company’s president and two secretaries, maintaining
company bank accounts, using an Ohio bank as a transfer agent for stock of
the company, holding several directors’ meetings, managing company policies
concerning rehabilitation of company property in the Philippines, and sending
funds to pay for projects in the Philippines. Id. at 447-48. Here, there is no
evidence of contacts with the United States similar to the contacts in Perkins.
5 See Daimler, 134 S. Ct. at 761 n.19 (“We do not foreclose the possibility that in an
exceptional case, see, e.g., [Perkins v. Benguet Consol. Mining Co., 342 U.S. 437 (1952)] . . . a
corporation’s operations in a forum other than its formal place of incorporation or principal
place of business may be so substantial and of such a nature as to render the corporation at
home in that State.”); see also Monkton Ins. Servs., Ltd. v. Ritter, 768 F.3d 429, 432 (5th Cir.
2014) (noting that “[i]t is . . . incredibly difficult to establish general jurisdiction in a forum
other than the place of incorporation or principal place of business.”).
5
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There is no evidence that Aker Subsea maintained an office, bank accounts, or
conducted any corporate business in the United States. Using Perkins as the
benchmark of the “exceptional case” where it is appropriate to exercise general
jurisdiction over a corporation outside of its principal place of business or place
of incorporation, we hold that Aker Subsea’s contacts fall well short of
effectively operating its business within the United States. At most, Aker
Subsea sent eleven of its employees to the United States when it entered into
the secondment agreements with its affiliate. 6 These contacts are insufficient
to make Aker Subsea essentially at home in the United States.
This court has declined to exercise general personal jurisdiction over a
corporation where its most significant and continuous contact with the forum
was having employees located there. See Bowles v. Ranger Land Sys., Inc., 527
F. App’x 319, 321-22 (5th Cir. 2013). In Bowles, a Texas resident sued an
Alabama corporation in Texas for an injury sustained from a car wreck with
the corporation’s employee in Kuwait. Id. at 320. The corporation moved to
dismiss for lack of personal jurisdiction. Id. The district court examined the
corporation’s contacts with Texas and reasoned that those contacts were
insufficient to subject the corporation to general personal jurisdiction in Texas.
Id. Thus, it granted the motion. On appeal, this court agreed, finding that the
corporation’s contacts with Texas were insufficient to exercise general
jurisdiction over it. Id. The contacts included the following: six employees of
the corporation worked at two military bases in Texas; the corporation’s
employees sometimes worked at or participated in training programs at a
British military contractor’s facility located in Texas; a small number of
employees of the corporation underwent processing at a U.S. military facility
6We assume, without deciding, that for purposes of this personal jurisdiction analysis
sending an employee to the United States under a secondment agreement is the equivalent
of sending an employee to work in the United States.
6
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in Texas before traveling to overseas assignments; the corporation paid
unemployment and franchise taxes in Texas; and the corporation’s website
could be accessed in Texas and contained email addresses for several
employees of the corporation. Id. at 321. The court noted that the presence of
employees was the corporation’s most significant and sustained contact with
Texas. Id. at 322. But this was not enough to establish general jurisdiction:
“That a small number of [the corporation’s] employees happen to live and work
in Texas on projects related to [the corporation’s] dealings with the military or
with other defense contractors does not indicate a sustained business presence
in the state.” Id. This reasoning applies to the facts here. That a small number
of employees of Aker Subsea were seconded to the United States to work for an
affiliate does not establish that Aker Subsea has a sustained business presence
here.
Additionally, the rare cases where this court has found general
jurisdiction over a foreign defendant are distinguishable. In System Pipe &
Supply, Inc. v. M/V Viktor Kurnatovskiy, 242 F.3d 322, 325 (5th Cir. 2001),
the panel concluded that the plaintiff’s factual basis for claiming general
jurisdiction over the foreign defendant corporation, if established, would be
sufficient to show national minimum contacts. Those contacts included the
following: (1) the defendant’s fleet of vessels regularly called at most major
ports in over fifty countries, including the United States; (2) in 1993, the
defendant established and began to advertise Azsco America Line to provide
service for U.S. Gulf Ports to the Mediterranean and Black Seas; (3) the
defendant maintained another line of vessels to carry cargo from the east coast
to Israel; (4) at least one of the defendant’s vessels had previously been
detained in Texas; (5) the defendant’s ship, the M/V VIKTOR
KURNATOVSKIY, called and discharged the plaintiff’s cargo at the Port of
Houston; (6) since 1993, the defendant had been a named party in
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approximately fifty actions in United States District Courts; and (7) the
defendant had been a defendant in another suit maintained in the Southern
District of Texas which was not dismissed for lack of personal jurisdiction. Id.
Significant here, Aker Subsea has not had the degree of continuous and
systematic contacts with the United States that the foreign defendant
corporation had with the United States in System Pipe. There is no evidence in
the record that Aker Subsea has regularly conducted business in the United
States, advertised here, maintained assets here, or has been a party to
litigation in United States courts.
In Adams, this court found that the defendant, a foreign insurer, had
sufficient contacts with the United States to assert general jurisdiction over it
under Rule 4(k)(2). 364 F.3d at 652. The defendant’s contacts included the
following: it had paid claims to numerous U.S. companies (155 in all from 1991
to 1994); it had covered numerous other U.S. companies which made no claims;
and it had insured hundreds of shipments to the United States. Records
showed that the defendant insured approximately 260 shipments to the United
States between 1989 and 1995 for one company alone; 138 of these shipments
were valued at over $130 million. Id. at 651. Even more, the defendant used
and paid a number of individuals in the United States as claims adjusters,
surveyors, investigators, and other representatives to enable it to conduct
business in America. Id. Here, there is no evidence that Aker Subsea conducted
any business in the United States, let alone the significant level of business
conducted by the defendant in Adams. 7
7 Both System Pipe and Adams predate Goodyear and Daimler AG. Scholars have
viewed the Court’s recent personal jurisdiction decisions as part of an access-restrictive
trend. See, e.g., Arthur R. Miller, Simplified Pleading, Meaningful Days in Court, and Trials
on the Merits: Reflections on the Deformation of Federal Procedure, 88 N.Y.U. L. Rev. 286,
304 (2013).
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Exercising personal jurisdiction over Aker Subsea under Rule 4(k)(2) is
appropriate only if its contacts with the United States as a whole are sufficient
to satisfy due process concerns. Aker Subsea’s limited contacts with the United
States—eleven secondment agreements—are insufficient to satisfy due process
concerns. Thus, exercising general personal jurisdiction over Aker Subsea
would be inappropriate. AFFIRMED.
9