Maxitrate Tratamento Termico e Controles v. Super Systems, Inc.

NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
File Name: 15a0382n.06
No. 14-3807
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
MAXITRATE TRATAMENTO TERMICO E )
CONTROLES, ET AL., a foreign corporation, ) FILED
) May 28, 2015
Plaintiff, ) DEBORAH S. HUNT, Clerk
)
JEREMY LEE HEDMAN, )
)
Third Party Plaintiff-Appellant, )
)
v. ) ON APPEAL FROM THE
) UNITED STATES DISTRICT
SUPER SYSTEMS, INC., ET AL., an Ohio ) COURT FOR THE SOUTHERN
corporation, ) DISTRICT OF OHIO
)
Defendant, )
)
ALLIANZ SEGUROS S.A., fka AGF Brasil Seguros )
S.A., )
)
Third Party Defendant-Appellee. )
)
Before: BOGGS and KETHLEDGE, Circuit Judges; HELMICK, District Judge.*
KETHLEDGE, Circuit Judge. Jeremy Hedman traveled from Ohio to Brazil, where he
was seriously injured in an explosion at a factory owned by a Brazilian company, Maxitrate
Tratamento Termico e Controles. After he returned to the United States, Hedman filed a third-
party complaint in the Southern District of Ohio against Maxitrate’s Brazilian insurer, Allianz
Seguros. Seguros is affiliated with Allianz, a global insurer, but Seguros itself is an independent
*
The Honorable Jeffrey J. Helmick, United States District Judge for the Northern District of
Ohio, sitting by designation.
No. 14-3807, Maxitrate Tratamento Termico e Controles, et al. v. Super Systems, Inc., et al.
entity that is incorporated in Brazil, with headquarters in Brazil, and sells all of its insurance
policies there. For those reasons, the district court held that it lacked personal jurisdiction over
Seguros and dismissed the complaint. We affirm.
I.
Maxitrate is a Brazilian company that makes heat-treated metal products. Maxitrate
purchases control panels for its industrial furnaces from Super Systems, Inc., an Ohio company.
Hedman, an Ohio citizen, worked for Super Systems. In 2008, Super Systems sent Hedman to
São Paulo to work on a furnace at Maxitrate’s factory. While Hedman was working on the
furnace, pressurized gas escaped and caused a large explosion that killed two Maxitrate
employees, injured two others, and seriously injured Hedman.
Maxitrate sued Super Systems and Hedman in the Southern District of Ohio, alleging that
Super System’s products were defective and that Hedman had been negligent. Hedman filed a
counterclaim against Maxitrate, alleging that Maxitrate’s negligence caused the explosion, and
that Maxitrate was therefore liable for his injuries. Maxitrate notified its insurer, Seguros, that
Hedman had filed the counterclaim. Seguros responded that Maxitrate’s policy did not provide
coverage for the claim, and declined to defend Maxitrate. Maxitrate and Hedman ultimately
settled the counterclaim; in the settlement, Maxitrate accepted liability for Hedman’s injuries,
and assigned to Hedman its claims against Seguros. Pursuant to that agreement, the district court
ordered Maxitrate to pay Hedman $12,861,978.77 in damages.
After the settlement, Hedman filed a third-party complaint against Seguros, alleging that
Seguros breached its contract with Maxitrate in bad faith when it denied that Maxitrate’s policy
covered Hedman’s counterclaim. Seguros moved to dismiss the complaint for lack of personal
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jurisdiction under Federal Rule of Civil Procedure 12(b)(2). The district court granted the
motion and dismissed the case. This appeal followed.
II.
We review de novo a district court’s dismissal for lack of personal jurisdiction. Miller v.
AXA Winterthur Ins. Co., 694 F.3d 675, 678 (6th Cir. 2012). A plaintiff bears the burden of
establishing that a court has jurisdiction over a defendant. Where, as here, the district court
resolves a Rule 12(b)(2) motion without an evidentiary hearing or discovery, the plaintiff need
only make a prima-facie showing that jurisdiction exists. Air Prods. & Controls, Inc. v. Safetech
Int’l, Inc., 503 F.3d 544, 549 (6th Cir. 2007).
In a diversity case, whether a federal district court in Ohio has personal jurisdiction over
a defendant depends on whether an Ohio state court would have jurisdiction. See Fed. R. Civ. P.
4(k)(1); Miller, 694 F.3d at 678. An Ohio state court would have jurisdiction if state law
provides for it and if the court’s exercise of jurisdiction satisfies the Due Process Clause. Id. at
679. Here, Seguros concedes that jurisdiction would be proper under Ohio law. Thus, we need
decide only whether the Due Process Clause allows an Ohio court to exercise jurisdiction over
Seguros.
The Due Process Clause allows for two kinds of personal jurisdiction: general and
specific. General jurisdiction allows a plaintiff to sue a defendant “on any and all claims,”
regardless of the connection (or lack thereof) between the claim and the forum. Daimler AG v.
Bauman, 134 S. Ct. 746, 754 (2014). Here, Hedman concedes that Seguros is not subject to
general jurisdiction in Ohio. Specific jurisdiction, on the other hand, allows a plaintiff to sue a
defendant only on claims that arise out of the defendant’s activities in the forum state. Id. For a
defendant to be subject to specific jurisdiction in a state, the defendant must have “minimum
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contacts” with the state “such that the maintenance of the suit does not offend traditional notions
of fair play and substantial justice.” Walden v. Fiore, 134 S. Ct. 1115, 1121-22 (2014) (internal
quotation marks and alterations omitted). To satisfy this standard, a plaintiff must show, among
other things, that the defendant “purposefully avail[ed] himself of the privilege of acting in the
forum state[.]” Miller, 694 F.3d at 680 (internal quotation marks omitted).
Here, Hedman must show that Seguros—a Brazilian company that sells insurance only in
Brazil—intentionally did something in Ohio that would allow an Ohio court to exercise
jurisdiction over Seguros. Hedman argues that Seguros purposefully acted in Ohio in several
ways.
Hedman principally contends that Seguros’s refusal to defend Maxitrate counts as
purposeful activity in Ohio, citing Calder v. Jones, 465 U.S. 783 (1984), in support. There, the
Court held that tabloid journalists in Florida were properly sued for libel in California, where the
plaintiff lived. The tabloid had sold over 600,000 copies in California, and the defendants knew
that “the brunt of [the plaintiff’s] injury would be felt” there. Id. at 785, 789-90. Hedman relies
on language in Calder suggesting that, if a defendant knows that its intentional acts will cause
effects in a state, then that state can exercise jurisdiction over the defendant. See id. at 789-90.
But the Supreme Court rejected that theory of personal jurisdiction (and that interpretation of
Calder) last year in Walden. 134 S. Ct. at 1123-26. There, the Court held that Nevada could not
exercise jurisdiction over a defendant from Georgia based merely on the defendant’s knowledge
that his false affidavit would cause harm to two plaintiffs in Nevada. Id. at 1125-26. To hold
otherwise, the Court held, would “improperly attribute[] a plaintiff’s forum connections to the
defendant and mak[e] those connections decisive in the jurisdictional analysis.” Id. at 1125
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(quotation marks omitted). Thus, the Court held, “it is the defendant, not the plaintiff or third
parties, who must create contacts with the forum State.” Id. at 1126.
Here, Seguros did not create any contacts with Ohio. To the contrary, to the extent that
Seguros’s decision not to defend Maxitrate (a Brazilian company) with respect to an accident in
Brazil had effects in Ohio, those effects were the result of Hedman’s and Maxitrate’s decisions to
litigate there. Indeed, Seguros’s decision to deny coverage was an affirmative decision not to go
to Ohio. And a foreign defendant does not subject itself to personal jurisdiction in a state simply
by refusing to litigate there.
Next, Hedman points to Seguros’s decision to sell an insurance policy to Maxitrate, a
company that does considerable business in Ohio. According to Hedman, Seguros should have
known that the policy might require Seguros to defend Maxitrate there. But the policy’s
“Geographical Scope” provision limits coverage to “property, liabilities, or persons situated on
Brazilian territory[.]” And the policy says that “[t]he competent jurisdiction to resolve litigation
in relation to this contract shall be that of the domicile of the insured”—here, Brazil. Seguros’s
decision to insure property in Brazil, therefore, is not purposeful activity in Ohio. See Miller,
694 F.3d at 680.
Hedman responds that our decision in Payne v. Motorists’ Mutual Insurance Cos., 4 F.3d
452 (6th Cir. 1993), dictates otherwise. There, a moving van insured by Motorists was involved
in an accident in Tennessee. Id. at 455-57. Motorists’ insurance policy expressly provided for
coverage anywhere in the United States or Canada. See id. at 454, 456. When the car went to
Tennessee, therefore, Motorists’ coverage went with it—not as a result of the driver’s unilateral
actions, but of the company’s purposeful decision to extend coverage nationwide. Here, in
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contrast, the policy covers risks only in Brazil. Moreover, in Payne the accident occurred in the
forum state, whereas here the accident occurred a continent away. Id. at 454.
Hedman contends that Ohio law creates two other contacts between Seguros and Ohio.
First, Hedman says that, under Ohio law, a breach of contract occurs in the jurisdiction where
performance was due. Seguros’s performance was allegedly due in Ohio, where Maxitrate was
litigating the dispute over the cause of the explosion. But this argument just adds a state-law
veneer to Hedman’s contention that jurisdiction is proper because Ohio was where Maxitrate felt
the effects of Seguros’s decision to deny coverage. As shown above, Walden forecloses that
theory of personal jurisdiction as a matter of federal constitutional law, regardless of what Ohio
law says. Second, Hedman asserts that Ohio Rev. Code § 3929.06 provides a direct cause of
action for a plaintiff against a defendant’s insurance company. But that putative cause of action
does not amount to purposeful availment by Seguros of anything in Ohio; and a state-law cause
of action otherwise does not trump the Due Process Clause.
In sum, Seguros is a Brazilian insurance company that contracted with another Brazilian
company to insure property and persons situated in Brazil. Seguros has availed itself of nothing
in Ohio, and thus is not subject to suit there.
***
The district court’s judgment is affirmed.
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