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Media Alerts - Ainsworth v. Moffett Engineering, Ltd. - Fifth Circuit
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May 10, 2013
  Ainsworth v. Moffett Engineering, Ltd. - Fifth Circuit
Headline: Fifth Circuit Reaffirms its Stream-of-Commerce Personal Jurisdiction Test.

Area of Law: Civil Procedure

Issue Presented: Whether the Fifth Circuit's stream-of-commerce test to determine if a foreign manufacturer may be sued in the United States was overruled by the Supreme Court's recent opinion in J. McIntyre Machinery, Ltd. v. Nicastro.

Brief Summary: An Irish forklift manufacturer and its U.S. distributor were sued for wrongful death in the U.S. District Court for the Southern District of Mississippi. The manufacturer filed a motion to dismiss for lack of personal jurisdiction, which the district court denied. On appeal before the U.S. Court of Appeals for the Fifth Circuit, the manufacturer argued that the Fifth Circuit's stream-of-commerce test for personal jurisdiction, the test that the district court relied upon, had been overruled by the Supreme Court's recent opinion in J. McIntyre Machinery, Ltd. v. Nicastro. The Fifth Circuit disagreed. Accordingly, the court affirmed the district court and confirmed the continuing validity of its stream-of-commerce test.

Significance: The Fifth Circuit joins the Federal Circuit in viewing Justice Breyer's concurrence as representing the holding of McIntyre.

Extended Summary: Mary P. Ainsworth, individually and on behalf of all wrongful death beneficiaries, filed a products liability and wrongful death suit against an Irish forklift manufacturer, Moffett Engineering, Ltd., and its exclusive distributor in the United States, Cargotec USA, Inc., in the U.S. District Court for the Southern District of Mississippi. Moffett filed a motion to dismiss the lawsuit for lack of personal jurisdiction. The district court denied the motion based on the U.S. Court of Appeals for the Fifth Circuit's stream-of-commerce test. Under the stream-of-commerce test, there is personal jurisdiction when the court "finds that the defendant delivered the product into the stream of commerce with the expectation that it would be purchased by or used by consumers in the forum state." Shortly thereafter, the Supreme Court issued its opinion in J. McIntyre Machinery, Ltd. v. Nicastro. Moffett then requested that the district court reconsider its denial of Moffett's motion to dismiss for lack of personal jurisdiction in light of McIntyre. The district court then reviewed McIntyre and concluded that it was not applicable.

In an interlocutory appeal before the Fifth Circuit, Moffett argued that McIntyre overruled the Fifth Circuit's version of the stream-of-commerce test. The Fifth Circuit rejected that argument because Moffett's argument incorrectly assumed that Justice Kennedy's plurality opinion in McIntyre was the holding. A plurality opinion, however, is not necessarily the holding of a case. When the Court issues a plurality opinion, "the holding of the Court may be viewed as that position taken by those Members who concurred in the judgments on the narrowest grounds."

The Fifth Circuit concluded that Justice Breyer's concurrence in McIntyre, and not Justice Kennedy's plurality opinion, was the controlling opinion in the case. Justice Kennedy's plurality opinion would allow personal jurisdiction only where a defendant targeted the forum state. Justice Breyer's concurrence relied upon the fact that a single isolated sale by a distributor was not sufficient to establish personal jurisdiction over a foreign manufacturer under the Supreme Court's prior precedents. The Fifth Circuit concluded that Justice Breyer's concurrence in McIntyre did not overrule the Fifth Circuit's stream-of-commerce test. The court further observed that Moffett, acting through its U.S. distributor, had sold more than two hundred forklifts and derived millions of dollars of revenue from sales in Mississippi over the course of a decade. Accordingly, the Fifth Circuit affirmed the district court.

For the full opinion, please see: http://www.ca5.uscourts.gov/op...2/12-60155-CV0.wpd.pdf.

Panel: Circuit Judges Higginbotham, Smith, and Elrod

Argument Date: 01/08/2013

Date of Issued Opinion: 05/09/2013

Docket Number: No. 12-60155

Decided: Affirmed

Case Alert Author: Louis Holzer

Counsel: John G. Corlew, Corlew, Mumford & Smith, P.L.L.C., for Plaintiff-Appellee Mary P. Ainsworth. Allen C. Schlinsog, Reinhart Boerner Van Deuren, P.C., for Defendant-Appellant Moffett Engineering, Ltd.

Author of Opinion: Judge Higginbotham

Case Alert Circuit Supervisor: Aaron-Andrew P. Bruhl

    Posted By: Aaron Bruhl @ 05/10/2013 09:28 AM     5th Circuit  

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