Document p2QyrjeBZJm9vdZY9Myx7KEwj

1 ft IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA FLETCHER McDANIEL / et UXi Plaintiffs/ v. ARMSTRONG WORLD INDUSTRIES/ INC./ et al./ Defendants. x ) ) ) ) ) ) ) ) ) ) ) ) ) Civil Action No. 83-3520 (Judge Flannery) Fi LED JUN121984 CLERK, PJSTRfST COURT DISTRICT nt COUIMBIA SUPPLEMENTAL MEMORANDUM IN SUPPORT OF MOTION OF DEFENDANT TURNER & NEWALL PLC TO DISMISS FOR LACK OF PERSONAL JURISDICTION Preliminary Statement Defendant Turner & Newall PLC ("T&N")/ by its attorneys/ respectfully submits this Supplemental Memorandum/ pursuant to the direction of the Court during the hearing held on June 5/ 1984/ in further support of T&N's Motion to Dismiss the Complaint for lack of personal jurisdiction. DISCUSSION I. JURISDICTION MUST BE BASED UPON THE FACTS EXISTING AS OF THE TIME AT WHICH JURISDICTION IS SOUGHT TO BE ASSERTED. As pointed out in the briefs and in oral argument/ this case differs from the cases relied on by Plaintiffs in that the only 1 contact which T&N has had with the District of Columbia since at least 1971 is the filing of a single lawsuit in this Court. Although there appear to be no cases in this Circuit on this point* federal courts in other circuits have held that the facts which determine whether the exercise of personal jurisdiction is proper are those existing as of the date the action is com menced. Thus* in denying jurisdiction in Connecticut Artcraft Corp. v Smith* 574 P. Supp. 626, 630 (D. Conn. 1983)* the Court stated that "Jurisdiction is to be determined at the time of the service of the complaint." Similarly* in Lachman v. Bank of Louisiana in New Orleans* 510 F. Supp. 753* 757 (N.D. Ohio 1981)* cited in T&N's Reply Memorandum at page 4* the Court stated "Jurisdiction is to be determined by examining the conduct of the defendant as of the time of service of the complaint. The Court does not look to whether the defendant had minimum contacts with the state at the time of the act complained of; rather* the Court looks to whether it could assert personal jurisdiction over the defendant at the time jurisdiction is sought to be asserted." Accord, In re Puerto Rico Air Disaster Litigation* 340 F. Supp. 492* 498 & n.19 (D.P.R. 1972) (Weinfeld* J.); Optico Corp. v. Standard Tool Co.* 285 F. Supp. 46, 48 (E.D. Pa. 1968). See also Hensen v. Fred Harvey* Inc.* 308 F. Supp. 218 (E.D. Pa. 1970); Proler Steel Corp. v. Luria Brothers & Co.* 225 F. Supp. 412* 413 (S.D. Tex. 1964) ("It is well settled that venue and jurisdiction are determined by the facts as they exist at the time the action is filed"). 2 t II. THE MERE FILING OF A LAWSUIT IN THIS COURT DOES NOT CONSTITUTE "DOING BUSINESS" IN THIS JURISDICTION SO AS TO SUBJECT T&N TO THE REACH OF THE D.C. "LONG-ARM" STATUTE. _________________________ In an attempt to avoid the foregoing well-settled rule that jurisdiction must be based on facts existing at the time the suit was filed* Plaintiffs asserted for the first time during oral argument that T&N's May 14* 1982 initiation of a lawsuit in this Court 1/ is* by itself* sufficient to constitute "doing business" in the District of Columbia under the D.C. long-arm statute. This argument has been expressly rejected by the D.C. Court of Appeals* which held in Payton v. Summit Loans* Inc.* 253 A.2d 459* 461 (D.C. App. 1969)* that a foreign corporation was not subject to jurisdiction in the District of Columbia even where it had insti tuted an average of between one and two suits per month in the D.C. Courts over the two and a half years immediately preceding the filing of that case: "Appellant urges that appellee is doing business in the District of Columbia ... by reason of the fact that between January* 1965* and the filing of his complaint in June* 1967* it had initiated in the court below each month on the average between one and two suits. The initiation of an action by a foreign corporation does not in and of itself con- 1/ Turner & Newall PLC v. American Mutual Liability Co.* D.D.C. Civ. Action No. 82-1339, filed May 14, 1982. While Plaintiffs previously cited this case in opposition to T&N's Motion to Dismiss (Opp. at pg. 27), such was to counter any suggestion that it would work an undue hardship on T&N to litigate in this Court* not to support jurisdiction per se. We further note that the American Mutual complaint was filed more than two months in advance of the issuance of this Court's Order dismissing a similar complaint against T&N in Catrett v. Johns-Manville Sales Corp.* D.D.C. Civ. Action No. 81-2732* Order issued July 21* 1982* app. dismissed D.C. Cir. No. 831694 (Feb. 6* 1984), not several years later as was suggested by Plaintiffs at oral argument. 3 stitute doing business in the jurisdiction where suit is brought. 18 Fletcher Cyclopedia Corpora tions# 8726.1 (1968 Cum. Supp.)." If the filing of between 30 and 60 cases over a 2 1/2 year period was insufficient to constitute doing business and serve as a basis for jurisdiction# clearly the single suit filed by T&N is insuf ficient. During oral argument Plaintiffs cited# for the first time# Ross v. Ross# 258 N.E. 2d. 437 (Mass. 1976)# in support of the contention that the mere filing of a lawsuit is sufficient to constitute doing business. Not only is such not the law in the District of Columbia# but# more importantly# the Ross decision does not even support Plaintiffs' premise. Ross involved a hus band's suit in Massachusetts State Court for specific performance of a separation agreement where the wife previously had used the Massachusetts courts to obtain an increase in the level of support ordered in a decree nisi of divorce which adopted the support provisions of the separation agreement. In holding the wife sub ject to jurisdiction in Ross# the Court cited the general rule that the mere execution of a separation agreement in the state is sufficient to confer jurisdiction as to a suit to enforce such separation agreement# and noted further that the wife's invocation of the Massachusetts court's aid in seeking modification of the same separation agreement was sufficient to satisfy any require ment of fairness and substantial justice. Here# in contrast# we are not dealing with a separation agreement or other subject matter peculiarly subject to D. C. jurisdiction. Moreover# the parties here are not the same as those in the American Mutual suit. 4 Further, this Court should disregard the filing by T&N of its lawsuit in the District of Columbia under the "government contacts" exception to the District's long-arm statute. "That exception holds that the local courts do not exercise personal jurisdiction over a nonresident on the basis of activity in the District relating solely to dealings with the federal govern ment." Stabilisierungsfonds fur Wein v, Kaiser Stuhl Wine Distributors Pty. Ltd., 647 F.2d 200, 205 n.ll (D.C. Cir. 1981); Environmental Research International Inc, v. Lockwood Greene Engineers, Inc., 355 A.2d 808, 813 (D.C. 1976). To hold T&N subject to jurisdiction on account of its filing of a lawsuit in a federal court located here would have a chilling effect upon the exercise of First and Fifth Amendment rights. III. MOREOVER, T&N SHOULD NOT BE HELD SUBJECT TO JURISDICTION WHERE THERE WERE NO SALES IN THE DISTRICT OF COLUMBIA. In asserting jurisdiction in this case. Plaintiffs rely primarily on the decisions in Nelson v. Park Industries, Inc., 717 F.2d 1120 (7th Cir. 1983), cert, denied, 104 S. Ct. 1278 (1984), and Kaiser Stuhl, supra, 647 F.2d 200. Unlike the situations in those cases, where there was evidence of actual sales within the respective forum of the relevant product, 2J the record in this case shows that there were no sales of Limpet in the District of Columbia. Rather, the "stream of commerce", here ended in Virginia where Krafft-Murphy purchased the Limpet. It was the unilateral action of Krafft-Murphy, a third party to this litigation, that 2/ See Nelson v. Park Industries, Inc., supra, 717 F.2d at 1123, & 1127, and Kaiser Stuhl, supra, 647 F.2d at 202 & 206 n.14. 5 brought Limpet into this jurisdiction. 3/ The Supreme Court has held that the unilateral activities of a third party are "not ... appropriate consideration^] when determining whether a defendant has sufficient contacts with a forum ... to justify an assertion of jurisdiction." Helicopteros Nacionales de Colombiat S.A. v. Hall/ 104 S. Ct. 1868/ 1873 (1984). See also Vencedor Manufacturing Co. v. Gougler Industries/ Inc./ 557 F.2d 886 (1st cir. 1977); Product Promotions/ Inc, v. Cousteau/ 495 F.2d 483 (5th Cir. 1974). Such fortuitous acts by others provide an in sufficient basis upon which to assert personal jurisdiction over T&N. 4/ Thus/ even were T&N's total lack of contacts with the 3/ It is clear that plaintiffs' stream of commerce theory can only justify jurisdiction under subsection (a)(4) and not under the transacting business element of subsection (a)(1). Walsh v. National Seating Co./ 411 F. Supp. 564/ 569 (D. Mass. 1976). 4/ Prior to the June 5/ 1984 hearing/ Plaintiffs submitted the Memorandum and Recommendation of Magistrate DeGiacomo in Sheehan v. Owens-Corning Fiberglas Corp./ Civil Action No. 832160M. (d. Mass.). That Memorandum recommends that T&N be held subject to personal jurisdiction in Massachusetts/ inter alia/ for acts which Keasbey & Mattison Company ("Keasbey")/ a former T&N subsidiary/ allegedly performed within Massachu setts. Although Plaintiffs have not abandoned their claim that T&N is subject to this Court's jurisdiction on account of Keasbey/ they have not pressed the issue. In the event this Court thinks the issue relevant/ T&N refers this Court to its papers filed in opposition to Magistrate DeGiacomo's recom mendation in Sheehan (especially the 1984 Affidavit of Robert R. Porter)/ arguing that the Magistrate incorrectly decided the issue of T&N's relationship to Keasbey. Copies of T&N's Sheehan papers have been filed with this Court on June 4, 1984. T&N also refers this Court's attention to the affidavits that led the Fifth Circuit to decide that T&N was not the alter ego of Keasbey in Hargrave v. Fibreboard Corp./ 710 F.2d 1154 (5th Cir. 1983). Copies of the affidavits of John Mason Atkinson/ Group Solicitor to T&N/ sworn to December 23/ 1981/ and of Sir Ralph Melton Bateman/ former Chairman of 6 District of Columbia for more than twelve years to be ignored# there would still be rio proper basis upon which to premise juris diction over T&N in this case. CONCLPSION For the foregoing reasons# and for the reasons set forth in T&N's prior submissions to this Court# T&N's Notion to Dismiss Plaintiffs' Complaint as to T&N should be granted in all respects. Respectfully submitted# Hopewell H. Darneille# III Bowman Conner Touhey & Petrillo A Professional Corporation 2828 Pennsylvania Avenue# N.W. Washington# D.C. 20007 (202) 965-7600 and. June 12# 1984 Charles E. Dorkey III Paul J. Hanly# Jr. Richards O'Neil & Allegaert 660 Madison Avenue New York# New York 10021 (212) 207-1200 Attorneys for Defendant Turner & Newall PLC 4/ (footnote continued from previous page) T&N# and which were submitted in support of T&N's motion for summary judgment in Hargrave# are annexed hereto as Exhibit A. Moreover# similar affidavits are on file with this Court as part of T&N's submission in Catrett v. Johns-Manville Sales Corp.# D.D.C. Civ. Action No. 80-2232. 7 C/V2 3>--3S-Cx< r ILLu JUN12 1984 CLERK, UA DJSXWCT COURT DISTRICT OP COLUMBIA I, Ralph Malton Bateman, Knight of tha British Empire, of Prestbury, England, make oath and say as follows*- (1) I understand that the relationship between Turner t Hawaii Limited ("T&N") and Kaasbay and Mattison Company ("Kaasbay") has bean put in issue in various proceedings in the United States. (2) I have been asked by TSN to state my understanding and knowledge of the relationship between TSH and Keasbey and the matters hereafter stated are true to the best of my knowledge, information and belief. (3) I joined T6H in 1931. On 1st November 1957 1 was elected a Director of Till. From 1959 to July 1967 I was Deputy Chairman and Managing Director of T6N. On 1st July 1967 I was elected Chairman of the Board of Directors of T6N and served in that position until my retirement on 31st July 1976. (4) From 27th February 1959 to the dissolution of Keasbey I was a Director of Keasbey. For a brief period from 27th February 1959 to 31st August 1959 I served as Chairman of the Board of Directors of Keasbey. It became apparent however that my other duties to T4N would not allow me to preside at meetings regularly. I therefore resigned my position as Chairman of the Board of Directors of Keasbey but remained a Director of Keasbey from 31st August 1959 to the dissolution of Keasbey. I held no other office with Keasbey and no other director, officer or employee of T&H was a director or employee of Keasbey during the period from 27th February 1959 to the dissolution of Keasbey. (5) Although T&N indirectly owned 100 per cent of the coBBon stock of Keesbey ss an investment, Eeasbey was an independent corporate entity entirely separate and distinct froB T&N operating fron its own offices through its own officers, directors, Banagenent and staff. (6) Keasbey held regular meetings of its Board of Directors. 1 attended only one of these meetings. My contact with Keasbey was extremely infrequent. (7) Keasbey maintained its own bank accounts, accounting and payroll systems, insurance contracts and ledgers of sales and purchases. (8) To my knowledge there was never any interference by T&N as a parent corporation with Keasbey's choice of customers or marketing decisions nor for that matter with any other day-to-day corporate decision. (9) Reporting by Keasbey to TSH was wr.at normally and routinely is done by a subsidiary to a parent corporation and T&U's participating in the affairs of Keasoey was no more than what is normal and usual for a stockholder to do. (10) Keasbey was never authorised to act as agent of T&N and to ny knowledge Keasbey never m fact acted as T&ll's agent. { 4 (11) T6M never regarded Keasbey as a division or internal unit but always considered it, as indeed was the business reality, as an independently-operated corporation in which TtN had made an investment. IN WITNESS WHEREOF, I have hereunto signed ay name to the Foregoing oath and affidavit. Dated: RALPH MELTON BATEMAN On this IT i^day of 1981, Ralph Melton Bateman appeared before ae, swore to and executed the foreoing instrument and duly acknowledged that he executed the sane. NOTARY PUBLIC %!>*. 3A.ii.*-- 3*- 3-s? -1 t ; :? s -5 2 5. 12..1 11.45 _- 4FTi -int T * "> " I J -'5* .*0' 2 J* I iLO I-v.J , . . 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AT LZaST 3137 .-.JOJoT 1*59, 712 2Y Laws OF 22A332Y R20JIRZ3 T32 a.UJhL 2LZ3TI3.J OF a HARO jF OIR20T0R3 OF MOT 10R2 T.l.-ill 3 27 2:1 A JO 107 L35 3 TIAJ FIV3 OI23CT023, 22CZPT T.IaT O'J 1 5T.1 JU JZ 1962 7 12 3YZLArfS -jF KZA332Y V2R2 AIZIIOZO D J2 TO 732 PZI0I.J3 LIRUICA O.J A.JO OiSSOLJTIO.'I OF KZaS-SZY 73 ?ZR 'IT a IliJI iJ I 72222 01R30TORS, 0721:13 733 VI J-DI.J2 J? PZ2I0D. aT 12 T t* 4 Z. \ ri. 0 OFFICERS, OIRZCTDRS OR ZIPLOYOOS OF T " I FILL | n (11; 1 ,, / - -v. , .. 1 2 i 3* '* ' * * * 1 T ( , > j. r '* J ..3 (12) : j i =.v=, : j 10 ;' 7 3 *3 1 *:t> vJ : 5t4 _ <^3 3 3 3 * - W # ^ .J . 1# ^ 7 i 4 -* ? ^ mat ^ ^ -i 1 ) * I Jj "* 7.71.-ti* 3-i'2J-T3 '-3I.J3J3 73P.J PJ.IZ {-*3 ZO X' Tl^.ZZ 3Pi~VT: c:?..-j.-utio.;:. *i:coL-;r ::nj37/i:, i.:c. .,:;jji-.-d tx: rjzyizsi* iycljoi.jj 7-iz pp.oojot li.jzo, 3- t.*;i.jojs? 7:.,l ?.1J0J7T3 3IVI-;I3.J. (13) 77 T IS l ITU 03CI.= ' 1=62, X^s-ary -1 l o a cshtificats of -olzctio.; to dissolvz *ith tx-: SiCSiT/i-lY OF TXi CC J ICIJVZALTX Or ?Zll J3 YL7.-CJI.-i. O.'J i 3T-{ U?vO{ 106 7 A CZXTIFICaTO Or 01 350L JT I 0 I, * COPY Or vIIC { 13 .-iTT.-iCHOO TO Till ,\FFI.OhVIT, \T.-i3 OJLY a3'JTD 3Y Ti C?.T-WIY Or TAZ 0 j \ !0:JiXALT.I Or P3.JJ3YLV.-cJI.i# I J '0IT.J03 3 TAZAZOF* I -L-t7Z X ZXZ'JSTO 313 J 0 :r .u:-: to r.iz for.-:;ci.jj o.-it.-i ,:io affijv/it. ms tio 23 O.-iY Or 3C:!3:i, l =31. JO-I'.l USD'I .-iTia.JSO'J OS T iZ 2.3 O.AY Or 3C Z 13Z1, 1 = 31, JO i l ,:::i artci.jso:j appoa.ioo oifoh i-:> :ve?. to .vio sics- ::o Ti F3'.L030 I'll I.'JITRJ IZ.iT -i JO OJLY ACi'.IO VLZ0330 . . -"i . .lw jTjiD T-U 0.n i w -- Xli/i IDS I.-i.12 iS7 ZR kVM J * Art W -l.k O 3sc:i.iTA.tY t3 j i .vr;:i.is::; ^ 3T r* 66 722 1 T .J 3? -2 CERTIFICATE OF SERVICE I hereby certify that the foregoing "Supplemental Memorandum in Support of Defendant Turner & Rewall PLC to Dismiss for Lack of Personal Jurisdiction" were served this 12th day of June 1984, by delivering true and correct copies thereof by first-class mail/ postage prepaid/ to James F. Green/ Esquire and Peter T. Enslein/ Esquire/ Ashcraft & Gerel/ 2000 L Street/ N.W./ Washington/ D.C. 20036/ attorneys for Plaintiffs/ and to: Michael P. Chervenak/ Esquire Ford & O'Neil 17 West Jefferson Street Rockville/ MD 20850 Attorney for Armstrong World Industries Kevin J. McCarthy/ Esquire O'Malley/ Miles/ Farrington & McCarthy 99 Commerce Place Upper Marlboro/ MD 20772 Attorney for A. C. and S./ Inc. H. Patrick Donohue/ Esquire Donahue/ Ehrmantraut & Montedonico/ Chartered 51 Monroe Street - Suite 700 Rockville/ MD 20850 Attorneys for Atlas Turner/ Inc. and Bell Asbestos Mines/ Ltd. David P. Durbin/ Esquire Jordan/ Coyne/ Savits & Lopata 1030 15th Street, N.W. - Suite 500 Washington/ D.C. 20005 Attorney for Celotex Corporation Louis R. Moffa/ Jr. Schnader/ Harrison/ Segal & Lewis 1111 19th Street/ N.W. Washington/ D.C. 20036 Attorney for National Gypsum Company R. G. Guziak, Esquire Brault/ Graham/ Scott & Brault 1314 19th Street/ N.W. Washington/ D.C. 20036 Attorney for Nicolet/ Inc. Brock R. Landry/ Esquire Keck/ Mahin & Cate 1333 New Hampshire Avenue/ Washington/ D.C. 20036 Attorney for United States Gypsum Company N.W. Patrick James Attridge/ Esquire Macleay/ Lynch/ Bernhard & Gregg 51 Monroe Street/ Suite 806 Rockville/ MD 20850 Attorney for United States Mineral Products Co. Edward J. Lopata/ Esquire Jordan/ Coyne/ Savits & Lopata 1030 15th Street/ N.W. - Suite 500 Washington/ D.C. 20005 Attorney for W. R. Grace Company Hopewell H. Darneille/ III 2