Figley v. Ivex Protective Packaging, Inc. , 2016 Ohio 3501 ( 2016 )

[Cite as Figley v. Ivex Protective Packaging, Inc., 2016-Ohio-3501.]
IN THE COURT OF APPEALS OF OHIO
THIRD APPELLATE DISTRICT
SHELBY COUNTY
FRED M. FIGLEY III,
PLAINTIFF-APPELLANT, CASE NO. 17-16-02
-AND-
OHIO BUREAU OF WORKERS’
COMPENSATION,
PLAINTIFF-APPELLEE,
v. OPINION
IVEX PROTECTIVE
PACKAGING, INC., ET AL.,
DEFENDANTS-APPELLEES.
Appeal from Shelby County Common Pleas Court
Trial Court No. 13CV000062
Motion Denied; Judgment Affirmed
Date of Decision: June 20, 2016
APPEARANCES:
Paul W. Flowers for Appellant
David J. Simko for Appellee, Ohio Bureau of Workers’ Compensation
Bradley L. Snyder for Appellee, Concept Convoyeur, Inc.
Case No. 17-16-02
PRESTON, J.,
{¶1} Plaintiff-appellant, Fred M. Figley III (“Figley”), appeals the January
4, 2016 judgment entry of the Shelby County Court of Common Pleas dismissing
Figley’s amended complaint as to defendant-appellee, Concept Convoyeur, Inc.
(“Concept”). Figley also challenges on appeal the trial court’s February 26, 2015
judgment entry denying Figley’s motion for partial summary judgment and
granting the motion for summary judgment of plaintiff-appellee, the Ohio Bureau
of Workers’ Compensation (“BWC”). For the reasons that follow, we affirm.
{¶2} This case arises from a workplace accident at defendant-appellee’s,
IVEX Protective Packaging, Inc. (“IVEX”), plant in Sidney, Ohio. Figley was
operating a “bubble out bag machine” (“machine”) when his hand became trapped,
resulting in the loss of several of Figley’s fingers. The machine’s safety interlock
device was bypassed, allowing IVEX employees operating the machine to access
the internal mechanisms while the machine remained energized and operational.
Concept designed and manufactured the machine and sold it to IVEX in Canada,
with the understanding that the machine would be used in Illinois. IVEX
subsequently closed its Illinois plant and transferred the machine to its Sidney
plant.
{¶3} On March 27, 2013, Figley filed his complaint for personal injury
against IVEX and the BWC. (Doc. No. 1). On April 19, 2013, the BWC filed an
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answer and a motion “for realignment of the parties,” requesting that it be
realigned as a party plaintiff in the case and be allowed to file the complaint
attached to its motion for realignment. (Doc. Nos. 11, 10). Figley filed a
memorandum in opposition to the BWC’s motion for realignment on April 29,
2013. (Doc. No. 18). On May 28, 2013, the trial court granted the BWC’s motion
for realignment, and the BWC filed its complaint. (Doc. Nos. 26, 25).
{¶4} On May 24, 2013 and June 27, 2013, IVEX filed answers to Figley’s
complaint and the BWC’s complaint, respectively. (Doc. Nos. 24, 32).
{¶5} On February 24, 2014, IVEX filed a motion for summary judgment.
(Doc. No. 70). On April 16, 2014, Figley filed a memorandum in opposition to
IVEX’s motion for summary judgment. (Doc. No. 103). IVEX filed a reply brief
in support of its motion for summary judgment on May 7, 2014. (Doc. No. 109).
{¶6} Meanwhile, on March 3, 2014, with leave of court, Figley filed an
amended complaint for personal injury, adding Concept as a defendant. (Doc. No.
79). Figley’s amended complaint included claims: (1) against IVEX for
workplace intentional tort, “common law claims,” civil battery, and intentional
infliction of serious emotional distress; (2) against the BWC for a declaratory
judgment that R.C. 4123.93 and 4123.931—the statutes governing subrogation
rights related to the payment of workers’ compensation and benefits—do not
apply or, alternatively, if R.C. 4123.93 and 4123.931 do apply, a declaration as to
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the BWC’s subrogation rights; and (3) against Concept for product liability,
breach of warranty, and negligence. (See id.). On March 17, 2014, IVEX filed an
answer to Figley’s amended complaint. (Doc. No. 86). Concept filed an answer
to Figley’s amended complaint on June 19, 2014. (Doc. No. 116). In its answer,
Concept asserted the affirmative defense of lack of personal jurisdiction. (See id.
at 10).
{¶7} While IVEX’s motion for summary judgment was pending, Figley
reached a settlement with IVEX in the total amount of $280,000.00. (See Doc.
No. 127, Ex. A, ¶ 3). (See also Doc. No. 163).
{¶8} On October 6, 2014, Figley filed a motion for partial summary
judgment as to his declaratory-judgment claim against the BWC. (Doc. No. 127).
Specifically, Figley requested that declaratory judgment “be entered establishing
that Plaintiff BWC is entitled to $11,465.58 with regard to Plaintiff Figley’s
settlement recovery from Defendant IVEX.” (Id. at 12). On January 20, 2015, the
BWC filed a combined motion for summary judgment and memorandum in
opposition to Figley’s motion for partial summary judgment. (Doc. No. 149). In
its motion for summary judgment, the BWC proposed “two alternative methods
for arriving at the amount of the subrogation interest” as to Figley’s settlement
with IVEX. (Id. at 9). On February 6, 2015, Figley filed a response to the BWC’s
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motion for summary judgment. (Doc. No. 155). On February 17, 2015, the BWC
filed a reply in support of its motion for summary judgment. (Doc. No. 161).
{¶9} On February 26, 2015, the trial court filed a judgment entry in which it
granted the BWC’s motion for summary judgment and denied Figley’s motion for
partial summary judgment. (Doc. No. 163). In its judgment entry, the trial court
concluded that, as to Figley’s settlement with IVEX, the subrogation interest of the
BWC is $292,944.56. (Id. at 6).
{¶10} On April 22, 2015, Figley and the BWC filed a “notice of dismissal
with prejudice” of IVEX. (Doc. No. 167). That document stated, “Now come the
parties [Figley], [the BWC,] and [IVEX] and advise the Court that they have
settled and adjusted this matter among themselves.” (Id.).
{¶11} On June 26, 2015, Concept filed a “motion to dismiss and/or for
summary judgment.” (Doc. No. 171). In that motion, Concept argued, among
other things, that the trial court lacked personal jurisdiction over Concept. (Id. at
8). On October 9, 2015, Figley filed a memorandum in opposition to Concept’s
motion. (Doc. Nos. 185, 184). Concept filed a reply in support of its motion on
November 2, 2015. (Doc. No. 190).
{¶12} On January 4, 2016, the trial court filed a judgment entry concluding
that it did not have personal jurisdiction over Concept, granting Concept’s motion,
and dismissing Concept from the case. (Doc. No. 191).
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{¶13} On January 13, 2016, Figley filed a notice of appeal. (Doc. No. 192).
He raises two assignments of error for our review. We will address Figley’s
assignments of error in reverse order.
Assignment of Error No. II
A further legal error was committed when the trial court
determined that personal jurisdiction could not be exercised
over defendant-appellee, Concept Convoyeur, Inc. [Decision
dated January 4, 2016]
{¶14} In his second assignment of error, Figley argues that the trial court
erred by concluding that it did not have personal jurisdiction over Concept,
granting Concept’s “motion to dismiss and/or for summary judgment,” and
dismissing the action against Concept. Specifically, Figley points out that there is
no dispute that Concept understood that the machine would be used in Illinois.
Therefore, Figley argues, “Concept should have appreciated, and undoubtedly did
appreciate, that its customers would be moving their equipment across state lines
as needed. If the foreign company did not want to be sued in the United States, it
never should have done business with Defendant IVEX.” (Appellant’s Brief at
20).
{¶15} Concept captioned its motion as one “to dismiss and/or for summary
judgment” under Civ.R. 12(B)(2) and Civ.R. 56. (Doc. No. 171). See Reynolds v.
HCR ManorCare, Inc., 9th Dist. Summit No. 27411, 2015-Ohio-2933, ¶ 9
(involving a “motion to dismiss pursuant to Civ.R. 12(B) and/or motion for partial
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summary judgment”). At the time Concept filed its “motion to dismiss and/or for
summary judgment,” it already filed an answer to Figley’s amended complaint.
See Reynolds at ¶ 9. See also Patton v. Risner, 3d Dist. Wyandot No. 16-09-14,
2010-Ohio-191, ¶ 9 (noting that a motion raising a defense under Civ.R. 12(B)
“‘shall be made before pleading * * *,’ i.e., before filing an answer”), quoting
Civ.R. 12(B). While the trial court addressed Concept’s motion as one “to dismiss
or for summary judgment,” “the motion and judgment could be construed as a
motion for judgment on the pleadings” because Concept filed an answer before its
motion. (Doc. No. 191); Reynolds at ¶ 9, citing Savoy v. Kramer, 9th Dist.
Summit No. 27418, 2015-Ohio-437, ¶ 5. “Irrespective of how the motion is
labeled, our standard of review would be de novo.” Reynolds at ¶ 9, citing Savoy
at ¶ 5. “As [no] party has raised this issue or discussed the propriety of the trial
court’s consideration of the motion as a motion to dismiss, for purposes of this
appeal we will review the judgment as a ruling on a motion to dismiss.” Id.
{¶16} “Once a defendant moves to dismiss a complaint for lack of personal
jurisdiction under Civ.R. 12(B)(2), the burden shifts to the plaintiff to establish
jurisdiction over the nonresident defendant.” Wedemeyer v. U.S.S. F.D.R (CV-42)
Reunion Assoc., 3d Dist. Allen No. 1-09-57, 2010-Ohio-1502, ¶ 37, citing
Hercules Tire & Rubber Co. v. Murphy, 133 Ohio App. 3d 97, 100 (3d Dist.1999).
“When a court determines personal jurisdiction without an evidentiary hearing, it
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must ‘view allegations in the pleadings and documentary evidence in the light
most favorable to the non-moving party’ and ‘resolv[e] all reasonable competing
inferences’ in favor of the non-moving party.” Id., quoting Goldstein v.
Christiansen, 70 Ohio St. 3d 232, 236 (1994). The plaintiff is required to make
only a prima facie showing of personal jurisdiction when no evidentiary hearing is
held. Id., citing Giachetti v. Holmes, 14 Ohio App. 3d 306, 307 (8th Dist.1984).
“In order to make a prima facie showing of personal jurisdiction, ‘the plaintiff
must provide sufficient evidence to allow reasonable minds to conclude that
personal jurisdiction exists over the defendant.’” Id., quoting Parshall v. PAID,
Inc., 10th Dist. Franklin No. 07AP-1019, 2008-Ohio-3171, ¶ 9, citing Goldstein at
236. “Whether personal jurisdiction exists is a question of law that we review de
novo.” Id., citing Joffe v. Cable Tech, Inc., 163 Ohio App. 3d 479, 2005-Ohio-
4930, ¶ 10 (10th Dist.).
{¶17} “Whether an Ohio court has personal jurisdiction over a nonresident
defendant, depends upon: (1) whether R.C. 2307.382(A), Ohio’s long-arm statute,
and Civ.R. 4.3 permit the court to assert personal jurisdiction; and, if so, (2)
whether bringing the defendant within the jurisdiction of the Ohio courts would
violate traditional notions of fair play and substantial justice under the Due
Process Clause.” Id., citing Parshall at ¶ 10, citing Goldstein at 235, citing U.S.
Sprint Communications Co., Ltd. Partnership v. Mr. K’s Foods, Inc., 68 Ohio
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St.3d 181, 183-184 (1994). “When a court decides that jurisdiction is improper
under Ohio’s long-arm statute, it need not address whether due-process
requirements have been met.” Starks v. Choice Hotels Internatl., 175 Ohio
App.3d 510, 2007-Ohio-1019, ¶ 10 (1st Dist.).
{¶18} R.C. 2307.382 sets forth “specific activities that allow Ohio courts to
exert personal jurisdiction over a nonresident defendant.” Wedemeyer at ¶ 39,
citing Parshall at ¶ 11, citing Joffe at ¶ 12, citing Mr. K’s Foods, Inc. at 184.
“Civ.R. 4.3(A), which permits out-of-state service of process on a defendant to
confer personal jurisdiction is coextensive with R.C. 2307.382, and the two
provisions ‘complement each other.’” Id., citing Parshall at ¶ 12, citing Joffe at ¶
12, citing Kentucky Oaks Mall Co. v. Mitchell’s Formal Wear, Inc., 53 Ohio St. 3d
73, 75 (1990). “R.C. 2307.382 and Civ.R. 4.3(A) allow Ohio courts to exercise
jurisdiction over nonresident defendants in causes of action arising from several
enumerated circumstances,” including a nonresident’s “[t]ransacting any business
in this state” and “[c]ontracting to supply services or goods in this state.”
Cincinnati Equine v. Sandringham Farm, 1st Dist. Hamilton No. C-150067, 2016-
Ohio-803, ¶ 12; R.C. 2307.382(A)(1), (2); Civ.R. 4.3(A)(1), (2).
{¶19} Regarding R.C. 2307.382(A)(1) and Civ.R. 4.3(A)(1), “[t]he Ohio
Supreme Court has broadly defined ‘transacting business’ to include ‘to prosecute
negotiations; to carry on business; to have dealings.’” Lucas v. P & L Paris Corp.,
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7th Dist. Mahoning No. 11-MA-104, 2012-Ohio-4357, ¶ 18, quoting Kentucky
Oaks Mall Co. at 75, quoting Black’s Law Dictionary 1341 (5th Ed.1979).
“Because the definition is so broad, cases involving questions of what constitutes
‘transacting business’ have been resolved on highly particularized facts that do not
lend themselves to generalization.” Id. at ¶ 18, citing Goldstein, 70 Ohio St. 3d at
236. Nevertheless, to fall within R.C. 2307.382(A)(1) and Civ.R. 4.3(A)(1), “a
nonresident’s ties must ‘create a “substantial connection” with the forum State.’”
Mr. K’s Foods, Inc. at 185, quoting Burger King Corp. v. Rudzewicz, 471 U.S.
462, 475, 105 S. Ct. 2174 (1985). The First District Court of Appeals “set out
several useful factors to be considered when determining whether a foreign
corporation has transacted business in Ohio including whether the foreign
corporation ‘(1) initiated the business dealings, (2) participated in business
negotiations, (3) ordered work to be performed in Ohio, and (4) remitted payments
to or owed other obligations in Ohio.’” Lucas at ¶ 19, quoting N. Am. Software,
Inc. v. James I. Black & Co., 1st Dist. Hamilton No. C-100696, 2011-Ohio-3376, ¶
15.
{¶20} Figley and Concept do not dispute the facts. The owners of Concept
are Pierre Debien (“Pierre”), president of Concept, and Mathieu Debien
(“Mathieu”), vice president of Concept. (Affidavit of Mathieu Debien (“M.
Debien Aff.”), ¶ 2, 4, Doc. No. 171, Ex. B). Concept is a Canadian corporation
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located in Montreal, Quebec, Canada. (Id. at ¶ 3). Concept does not own or have
an interest in any real property in the United States, nor is it registered to do
business in any state in the United States. (Id. at ¶ 3, 6). Pierre and Mathieu have
never been to Ohio for any business or non-business purpose. (Id. at ¶ 5).
Concept has no agents or employees acting on its behalf in the United States. (Id.
at ¶ 7).
{¶21} Approximately one year before Concept sold the machine to IVEX,
Mathieu, at IVEX’s request, traveled to IVEX’s plant in Illinois to tour the plant
and make production recommendations. (Deposition of Mathieu Debien (“M.
Debien Depo.”) at 8, 11-15, Doc. No. 178). The machine, which Concept
manufactured and sold to IVEX approximately one year after Mathieu visited
IVEX’s Illinois plant, was unrelated to Mathieu’s visit to the plant. (Id. at 14-15).
Other than Mathieu’s trip to IVEX’s Illinois plant, no employee or agent of
Concept has ever been physically present in the United States for any purpose
related to Concept’s business. (M. Debien Aff. at ¶ 8). Concept sold the machine
to IVEX and shipped it to IVEX’s Longueuil, Quebec, Canada location, knowing
that it would be used in Illinois. (Id. at ¶ 18-19). Without Concept’s knowledge,
IVEX closed its Illinois plant and transferred the machine to its plant in Sidney,
Ohio. (Id. at ¶ 19). IVEX contacted Mathieu to obtain replacement parts for the
machine, at which point Concept learned that the machine had been moved to
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Ohio. (Id. at ¶ 19-20). As a result of this communication, IVEX sent Concept a
purchase order for the replacement parts; Concept manufactured them; Concept
sent them to Sidney; and Concept invoiced IVEX’s Sidney location for them. (Id.
at ¶ 20, Ex. B-1). Aside from this replacement-parts transaction, Concept does not
supply goods or services to Ohio. (Id. at ¶ 7, 17).
{¶22} Figley argues that the trial court has personal jurisdiction over
Concept under the transacting-any-business circumstance of R.C. 2307.382(A)(1)
and Civ.R. 4.3(A)(1) and the contracting-to-supply-services-or-goods
circumstance of R.C. 2307.382(A)(2) and Civ.R. 4.3(A)(2). Figley’s argument is
based on his position that, because Concept sold the machine knowing that it
would be used in Illinois, the trial court has personal jurisdiction over Concept
because Concept knew, or should have known, that its equipment would be moved
across state lines as needed. Figley does not argue in his brief that Concept’s
sending replacement parts to Sidney contributed to its “[t]ransacting any business
in this state” or “[c]ontracting to supply services or goods in this state.” Indeed, at
oral argument, Figley’s counsel agreed that the replacement-parts transaction is
insufficient to allow an Ohio court to exercise personal jurisdiction over Concept.
Nevertheless, even considering Concept’s shipping replacement parts to Sidney, as
well as the original sale of the machine from Concept to IVEX for use in Illinois,
we conclude that there is not sufficient evidence in the record to allow reasonable
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minds to conclude that personal jurisdiction exists over Concept under either R.C.
2307.382(A)(1) and Civ.R. 4.3(A)(1) or R.C. 2307.382(A)(2) and Civ.R.
4.3(A)(2).
{¶23} As for R.C. 2307.382(A)(1) and Civ.R. 4.3(A)(1), the evidence in the
record in insufficient to establish a prima facie showing that Concept “transact[ed]
any business in this state.” Borrowing the factors analyzed by the First District in
James I. Black & Co., there is no indication in the record that Concept initiated
business dealings in Ohio or any other state in the United States. See James I.
Black & Co., 2011-Ohio-3376, at ¶ 16; Lucas, 2012-Ohio-4357, at ¶ 20. It
appears that IVEX initiated the business negotiations for the manufacture and sale
of the machine. (See M. Debien Depo. at 67). After IVEX moved the machine to
Sidney, it was IVEX that contacted Concept on one occasion to request
replacement parts. Second, there is no indication in the record that the business
negotiations surrounding the machine occurred anywhere other than in Canada
and, possibly, Illinois. See James I. Black & Co. at ¶ 16; Lucas at ¶ 21. Third,
Concept did not order any work to be performed in Ohio. Rather, the machine
was manufactured and sold in Canada for use in Illinois. See James I. Black &
Co. at ¶ 16; Lucas at ¶ 22. Fourth, Concept did not remit payments to or owe
other obligations in Ohio, aside from a shipment of replacement parts to Sidney in
exchange for payment from IVEX. See James I. Black & Co. at ¶ 16; Lucas at ¶
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23. We hold that the particular facts of this case do not sufficiently demonstrate a
prima facie showing that Concept possessed the “substantial connection”
necessary to satisfy R.C. 2307.382(A)(1) and Civ.R. 4.3(A)(1). See James I.
Black & Co. at ¶ 16; Lucas at ¶ 28.
{¶24} We likewise conclude that the evidence in the record is insufficient
to establish a prima facie showing that Concept “contract[ed] to supply services or
goods in this state” under R.C. 2307.382(A)(2) and Civ.R. 4.3(A)(2). There is no
indication in the record that Concept supplied services or goods in Ohio, except
for Concept shipping and accepting payment for the replacement parts that IVEX
requested once the machine was in Sidney. As we stated above, Figley does not
argue in his brief that this replacement-parts transaction satisfies R.C.
2307.382(A)(2) and Civ.R. 4.3(A)(2). In fact, it is unclear from Figley’s brief
exactly what conduct of Concept’s he believes amounted to “contracting to supply
services or goods in this state.” Nevertheless, we conclude that this single
transaction for replacement parts—which involved a one-page invoice written
predominately in French and requiring payment in Canadian funds—does not
satisfy R.C. 2307.382(A)(2) and Civ.R. 4.3(A)(2). See Speck v. Mut. Serv. Life
Ins. Co., 65 Ohio App. 3d 812, 816 (8th Dist.1990), citing U.S. Fire Ins. Co. v.
Butler-Sparks Mach. Co., 8th Dist. Cuyahoga No. 47832, 1984 WL 148458, *2
(Sept. 20, 1984) (concluding “that the sale of a single piece of equipment to an
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Ohio buyer under unspecified terms and conditions does not satisfy the ‘minimum
contacts’ standard under subsection (A)(2)”).
{¶25} In sum, although Figley was required to make only a prima facie
showing of personal jurisdiction, there is not sufficient evidence in the record to
allow reasonable minds to conclude that personal jurisdiction exists over Concept
under Ohio’s long-arm statute and Civ.R. 4.3. Because we conclude that
jurisdiction is improper under Ohio’s long-arm statute and Civ.R. 4.3, we need not
address whether due-process requirements have been met. See Starks, 175 Ohio
App.3d 510, 2007-Ohio-1019, at ¶ 10.
{¶26} Figley’s second assignment of error is overruled.
Assignment of Error No. I
The trial judge erred, as a matter of law, by granting summary
judgment and awarding plaintiff-appellee, Ohio Bureau of
Workers Compensation, a subrogation claim that is $12,944.56
more than the settlement amount recovered [Decision Dated
February 26, 2015]
{¶27} In Figley’s first assignment of error, he argues that the trial court
misinterpreted and misapplied R.C. 4123.93 and 4123.931—the statutes governing
the BWC’s right of subrogation following its payment of compensation or
benefits—in ruling on his motion for partial summary judgment and the BWC’s
motion for summary judgment. See Smith v. Jones, 175 Ohio App. 3d 705, 2007-
Ohio-6708, ¶ 15-20 (3d Dist.) (providing an overview of R.C. 4123.93 and
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4123.931). Specifically, Figley argues that the trial court erroneously concluded
that the BWC’s subrogation interest in Figley’s settlement with IVEX is
$292,944.56—“$12,944.56 more than Plaintiff Figley actually received from
Defendant IVEX.” (Emphasis sic.) (Appellant’s Brief at 13). Figley argues that,
notwithstanding his settlement with IVEX, the trial court should have allowed a
jury to decide his “demonstrated or proven damages” amount under R.C.
4123.93(F), which would be used to calculate his “uncompensated damages” and
factor into the BWC’s subrogation interest under R.C. 4123.931.
{¶28} Given our conclusion under Figley’s second assignment of error that
the trial court properly concluded that it did not have personal jurisdiction over
Concept, and given that Figley, the BWC, and IVEX “settled and adjusted this
matter among themselves” after the trial court ruled on Figley’s motion for partial
summary judgment and the BWC’s motion for summary judgment, Figley’s first
assignment of error is moot, and we decline to address it. App.R. 12(A)(1)(c).
See Miklovic v. Shira, 5th Dist. Knox No. 04-CA-27, 2005-Ohio-3252, ¶ 32
(“[A]ppellants attempt to claim error based upon the trial court’s denial of motions
entered by the trial court prior to the settlement agreement between the parties.
Appellants waived the right to raise such issues when they entered the settlement
agreement.”); Carbone v. Sericola, 11th Dist. Trumbull No. 2013-T-0053, 2014-
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Ohio-3526, ¶ 13 (“As appellant attacks the basis of granting summary judgment
and not the settlement agreement itself, all of his issues are waived.”).
{¶29} As a final matter, on April 22, 2016, the BWC filed a motion to
supplement the appellate record under App.R. 9 with a copy of the settlement
agreement reached between Figley, IVEX, and the BWC. In light of our
determination of Figley’s first and second assignments of error, concluding this
appeal, the BWC’s motion to supplement the appellate record is denied as moot.
See Leonard v. Georgesville Ctr., L.L.C., 10th Dist. Franklin No. 13AP-97, 2013-
Ohio-5390, ¶ 28.
{¶30} Having found no error prejudicial to the appellant herein in the
particulars assigned and argued, we affirm the judgment of the trial court.
Motion Denied;
Judgment Affirmed
SHAW, P.J. and ROGERS, J., concur.
/jlr
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