Schmidt, Sethi & Akmajian Blog

Civil Procedure/Specific Jurisdiction

Posted by Ted A. Schmidt | Jan 28, 2022 | 0 Comments

LNS Enterprises LLC v. Continental Motors, Inc., No. 20-16897 (9th Cir. January 12, 2022) (J. Gilman)

Purposefully directed activities in forum state by defendant must be shown to establish specific jurisdiction within state.

Plaintiff Spanganberg had to emergency land his small plane on a business trip in Arizona.  No one was injured but the plane was badly damaged and the engine destroyed. Plaintiff and his company sued multiple defendants alleging breach of warranty and product liability theories among others. Among the many defendants was Continental Motors Inc. [Continental], a Delaware Corporation and Textron Aviation, Inc. [Textron] a Kansas corporation both principally located and doing business outside Arizona. The United States District Court for the State of Arizona dismissed the claims against Continental and Textron for lack of jurisdiction. It also denied a request for jurisdictional discovery.  Plaintiffs appealed and the United States Court of Appeals for the Ninth Circuit affirmed.
Plaintiffs conceded that there was no general jurisdiction over these defendants so it came down to specific jurisdiction. To establish specific jurisdiction you must show:
(1) The non-resident defendant must 
purposefully direct his activities or
consummate some transaction with the forum
or resident thereof; or perform some act by
which he purposefully avails himself of the
privilege of conducting activities in the
forum, thereby invoking the benefits and
protections of its laws; (2) the claim must be
one which arises out of or relates to the
defendant's forum-related activities; and
(3) the exercise of jurisdiction must comport
with fair play and substantial justice, i.e. it
must be reasonable.
The maintenance of a website that can be accessed in any state that advertises a product where there is no evidence of a specific marketing strategy for the state where jurisdiction is sought is insufficient to establish jurisdiction. The distribution of nationwide service bulletins and identifying third party repair shops within Arizona on a website is not sufficient. Further even if the repair shops were operated by Continental, the plaintiffs failed to establish their damages were caused by that “purposeful activity.” Similarly, while Textron did indeed maintain a single repair shop in Arizona plaintiffs failed to demonstrate damages caused by that repair shop.

Finally where plaintiffs request to be allowed to do jurisdictional discovery was not supported by affidavit or evidence establishing how such discovery might be helpful the court it is properly denied. Here the court  concluded the request was supported by nothing more than a “hunch” that facts might be found to support specific jurisdiction and therefore was properly denied.   

About the Author

Ted A. Schmidt

Ted's early career as a trial attorney began on the other side of the fence, in the offices of a major insurance defense firm. It was there that Ted acquired the experience, the skills and the special insight into defense strategy that have served him so well in the field of personal injury law. Notable among his successful verdicts was the landmark Sparks vs. Republic National Life Insurance Company case, a $4.5 million award to Ted's client. To this day, it is the defining case for insurance bad faith, and yet it is only one of several other multi-million dollar jury judgments won by Ted during his career. He is certified by the State Bar of Arizona as a specialist in "wrongful death and bodily injury litigation".


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