MG+M Boston Attorneys Kevin Hadfield and Christos Koutrobis successfully obtained judgment on the pleadings for its client in Shepard v. AG Realty Investment, LLC, WWM-CV18-6014773-S, a personal injury case brought in the Connecticut Superior Court for the Judicial District of Putnam.

Plaintiff, a police officer, was attacked and bitten by a dog while executing a search warrant at an apartment building owned by MG+M’s client. In his complaint, Plaintiff stated that the dog was owned by a friend of the landowner’s tenant. Plaintiff claimed that the landowner should nevertheless be held liable because he was aware of, but did nothing to quell, significant alleged criminal activity on the premises. The alleged criminal activity resulted in Plaintiff’s need to be present on the property in his official capacity as well as the subsequent dog bite. Plaintiff asserted premises liability negligence claims in his complaint.

MG+M moved to strike the Plaintiff’s complaint for failure to state a claim. As grounds for its motion, MG+M argued that pursuant to the common law “firefighter’s rule,” a landowner owes no duty of care to a first responder that enters the premises within the scope of his official duties. In fact, the Connecticut Supreme Court has made clear that “under the firefighter’s rule, the landowner generally owes the firefighter or police officer injured on his property only the duty not to injure him willfully or wantonly . . . .” Levandovski v. Cone, 267 Conn. 653, 654 (2004) (internal citations and quotations omitted).

Plaintiff opposed MG+M’s motion, asserting that the claims were based on principles of “ordinary” negligence, rather than premises negligence, and were therefore excluded from the protections afforded by the firefighter’s rule. Plaintiff attempted to draw parallels between his case and Sepega v. DeLaura, 326 Conn. 788 (2017), in which the Connecticut Supreme Court permitted a case sounding in ordinary negligence to proceed against a landowner that actively barricaded himself into a house, forcing the officer to break the door down, resulting in injuries. The Superior Court rejected Plaintiff’s comparison, and held that the Sepega Defendant’s “active” negligence created an immediate hazard for the Plaintiff who had already entered the premises, which was distinguishable from the “passive” defective premises negligence allegations set forth in Plaintiff’s complaint.

In its memorandum of decision granting MG+M’s motion, the Court highlighted Plaintiff’s failure to allege that AG Realty had any knowledge of the presence of the dog that allegedly attacked the Plaintiff and also failed to assert factual allegations that would suggest willful or wanton misconduct on the part of the defendant. The Court struck plaintiff’s complaint and entered judgment on the stricken complaint in MG+M’s favor.

This common-sense application of the “firefighter’s rule” affirms the protections afforded to landowners from lawsuits by first responders, who may enter their premises at any time, from any direction, without invitation or warning, and without prior notice and opportunity to the landowner to remedy potential defects on the property. The rule prevents landowners from being held to an unreasonable standard of care, in that they would otherwise be compelled to keep all parts of their property in a condition uncalled for relative to the normal use for which the premises are utilized.

“Insufficient evidence as a matter of law.” This language, contained in a brief one paragraph opinion in which New York’s highest court affirmed an appellate decision to set aside a jury verdict in favor of plaintiffs, describes the court’s rationale for determining that the plaintiff failed to prove her claims under the state’s jurisprudence. In Juni v. A.O. Smith Water Prods. Co., et al., Mary Juni pursued claims on behalf of her deceased husband, Arthur Juni, who was diagnosed with mesothelioma. Mr. Juni spent over 25 years working as a mechanic on automobiles manufactured by defendant Ford Motor Company, including work with brakes and clutches (“friction products”).

The plaintiff introduced evidence at trial that the chrysotile asbestos-containing automotive component parts utilized by Mr. Juni during the course of his automotive work was the cause of his mesothelioma. Ford, while not disputing the presence of chrysotile asbestos in its parts, submitted expert testimony that demonstrated the chrysotile asbestos contained in the friction products would have undergone a chemical transformation while subjected to high temperatures during the manufacture and use in vehicles, thus converting the asbestos into a benign substance called forsterite, which does not cause mesothelioma.

The jury found in favor of Mrs. Juni, but the trial court set aside the verdict against Ford, reasoning that the evidence was legally insufficient to support the verdict because plaintiff’s experts failed to refute testimony provided by Ford’s experts that chrysotile asbestos in friction products is converted to forsterite and rendered non-toxic. Continue Reading NYCAL Opinions on Causation May Spark Increase in Summary Judgments

Punitive damages are meant to serve two purposes: punish the defendant for the conduct at issue in the lawsuit and deter similar conduct in the future. But, sometimes a punitive damages award goes beyond serving these two purposes and moves into the territory of violating the Due Process Clause of the 14th Amendment to the United States Constitution. The 14th Amendment, through the Due Process Clause, prohibits the imposition of grossly excessive or arbitrary punishments.

Punitive damages are allowed in California under California Civil Code section 3294(a), which states “In an action for the breach of an obligation not arising from contract, where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice, the plaintiff, in addition to the actual damages, may recover damages for the sake of example and by way of punishing the defendant.” Although California law does not define “clear and convincing evidence”, it carries a higher burden of proof than “preponderance of the evidence,” which is the burden of proof necessary to prevail in a civil lawsuit. In determining whether to award punitive damages, the jury considers: (1) the reprehensibility of the defendant’s conduct; (2) whether there is a reasonable relationship between the amount of punitive damages and the plaintiff’s harm; and (3) what amount will punish the defendant and discourage similar future conduct. In determining this amount, the jury considers the defendant’s financial condition. In California, there is no official cap on punitive damages. Continue Reading Excessive Punitive Damages Awards Continue To Be An Issue In California

Published Decision: Knox v. MetalForming, Inc., 914 F.3d 685 (1st Cir. 2019)

MG+M Boston Attorneys Javier Flores, Eric Skelly, and Thaddeus Lenkiewicz authored the appellate briefing. Attorney Flores presented oral argument.

The extent to which state and federal courts may exercise specific personal jurisdiction over foreign defendants has long been an area of ambiguity and disharmony. Notably, the U.S. Supreme Court’s two most recent attempts to address the issue both failed to produce a majority opinion. The lower courts have thus been tasked with delineating the boundaries of jurisdictional authority, armed only that the competing tests articulated in the Supreme Court’s fractured pronouncements. On January 30, 2019, the Court of Appeals for the First Circuit issued a decision in the matter of Knox v. MetalForming, Inc. and Schechtl Maschinenbau GmbH[1], which provides much needed clarity concerning the relevant factors and applicable standards for the exercise of personal jurisdiction over foreign product manufacturers.

  1. Case-Specific Jurisdiction Precedent and the Stream-of-Commerce Analysis

For the exercise of personal jurisdiction to be constitutional, a defendant must have “certain minimum contacts” with the forum state such that the maintenance of the suit does not offend “traditional notions of fair play and substantial justice.”[2] In the absence of general jurisdiction, a plaintiff must establish that the court has case-specific jurisdiction over the defendant, for which a three-part test applies. First, the plaintiff’s claim must directly arise out of, or relate to, the defendant’s forum-state activities. Second, the defendant’s forum contacts must represent a purposeful availment of the privilege of conducting activities in the forum state. Third, the exercise of jurisdiction must be reasonable.

While the test is well established, it is “’not susceptible of mechanical application” and requires a highly fact-specific inquiry.[3] Particularly, the Supreme Court’s efforts to provide guidance in the application of “purposeful availment” prong to foreign manufacturers has resulted in competing variations of the so-called “stream-of-commerce” test. The Supreme Court first set forth the “stream-of-commerce” standard in World-Wide Volkswagen v. Woodson, stating that a “forum State does not exceed its powers under the Due Process Clause if it asserts personal jurisdiction over a corporation that delivers its products into the stream of commerce with the expectation that they will be purchased by consumers in the forum State.”[4] In Asahi Metal Indus. v. Super. Ct., Justice O’Connor, writing for three other justices, stated that placing a defective product into the stream of commerce combined with “an intent or purpose to serve the market in the forum State” satisfied purposeful availment.[5] This “stream-of-commerce plus” standard, sought “[a]dditional conduct of the defendant” to “indicate an intent or purpose to serve the market in the forum State.”[6] Examples included designing the product for the market in the forum state, advertising in the forum state, establishing channels for providing regular advice to customers in the forum state, or marketing the product through a distributor who has agreed to serve as the sales agent in the forum state.[7]

The Supreme Court revisited its stream-of-commerce precedent most recently in J. McIntyre Mach., Ltd. v. Nicastro.[8] There, the plaintiff was injured in New Jersey while operating a machine that was manufactured in England by J. McIntyre Machinery (“McIntyre”), sold to a U.S. distributor, who in turn sold and shipped the machine to New Jersey. In a split opinion, the Supreme Court ruled that the New Jersey courts lacked jurisdiction over McIntyre. Both Justice Kennedy’s plurality opinion and Justice Breyer’s concurrence emphasized that McIntyre did not have a single contact with New Jersey apart from the fact that the machine in question ended up there.[9] Justice Kennedy, joined by three other justices, stated the stream-of-commerce “metaphor” merely acknowledges the “unexceptional proposition” that “a defendant may in an appropriate case be subject to jurisdiction without entering the forum . . . as where manufacturers or distributors seek to serve a given State’s market.”[10] Justice Kennedy continued that jurisdiction is appropriate only where the defendant “can be said to have targeted the forum.”[11]

In a concurrence, Justice Breyer rejected the plurality’s “strict rules that limit jurisdiction where a defendant does not intend to submit to the power of a sovereign and cannot be said to have targeted the forum.”[12] He observed that the case could be decided merely by applying the Court’s existing precedents and did not require the Court to promulgate a new standard. Justice Breyer noted that the Court had never held that a single isolated sale is sufficient.[13] Thus, McIntyre was not subject to the court’s jurisdiction because there was no evidence of a “regular flow or regular course of sales in New Jersey” nor the examples of “something more” identified in Asahi.[14] Courts have subsequently recognized Justice Breyer’s opinion as the narrowest grounds for the Court’s decision, and thus the binding opinion.[15]

  1. Facts and Procedural of Knox Case

The Knox matter involves an individual who was injured in Massachusetts in October 2016 while operating a metal folding machine manufactured by a German company, Schechtl Maschinenbau GmbH (“Schechtl”). The machine had been sold to the Plaintiff’s Massachusetts employer by MetalForming, Inc. (“MetalForming”), a Georgia-based company who served as Schechtl’s exclusive distributor in the U.S.

On a prima facie review of the pleadings, the First Circuit noted the following facts:

Schechtl is headquartered in Germany and maintains no operations in the U.S. Schechtl sells its machines to U.S. customers through MetalForming, an independently owned distributor. Each U.S. customer places an order with MetalForming who in turn sends a purchaser order to Schechtl. When a machine is ready, Schechtl delivers it to a transport agency in Germany, at which point ownership passes to MetalForming. MetalForming then installs the machine at the purchaser’s site. Schechtl also required MetalForming to pass information to customers received from Schechtl concerning Schechtl’s products and their proper use, including safety and instructional manuals which accompanied each machine. The instruction manuals direct purchasers to contact Schechtl (and not MetalForming) for inquiries, additional machine parts, troubleshooting, and additional training, and provide Schechtl’s direct contact information (phone number, fax number, mail and email address). As to the machine at issue, MetalForming provided Schechtl with a purchase order including the machine’s specifications and the name of the Plaintiff’s employer. Schechtl supplied the machine and accompanying manuals to MetalForming, who delivered them to the Massachusetts site of Plaintiff’s employer in 2001.

Schechtl provided MetalForming with advertising materials to market Schechtl products in the U.S. MetalForming promoted Schechtl machines in national trade publications and at industry trade shows. There was no evidence as to the Massachusetts recipients of those trade publications and no evidence that any of those shows was in Massachusetts. Between 2000 and September 2017, MetalForming sold 2,639 Schechtl machines throughout the U.S., at a value of just over $97 million. The Schechtl machine at issue was one of forty-five machines and 234 Schechtl parts MetalForming sold to purchasers in Massachusetts at a total value of nearly

$1.5 million (1.35% of Schechtl’s machine sales in the U.S.).

The Plaintiff sued MetalForming and Schechtl in Massachusetts Superior Court. After the matter was removed to federal court based-on diversity, Schechtl moved to dismiss for lack of personal jurisdiction. The U.S. District Court of Massachusetts granted the motion, finding that evidence of purposeful availment was lacking. The Plaintiffs and MetalForming appealed.

  1. First Circuit’s Decision

The Court of Appeals for the First Circuit reversed the dismissal upon finding that Schechtl had purposefully availed itself of the forum by selling substantial goods to Massachusetts and establishing channels of communication with Massachusetts customers. The First Circuit reaffirmed that Justice Breyer’s concurrence is the binding opinion of J. McIntyre, but noted the totality of Schechtl’s activities, voluntarily undertaken, satisfied the tests articulated in the concurrence as well as Justice Kennedy’s plurality opinion.[16]

To begin, the First Circuit rejected the Schechtl’s argument and the District Court’s holding that the exercise of jurisdiction required a showing that Schechtl designated Massachusetts “for special attention” or specifically “targeted buyers within Massachusetts.[17] “Supreme Court precedent does not establish specific targeting of a forum as the only means of showing that the purposeful availment test has been met.”[18] “Purposeful availment analysis will vary with the quality and the nature of the defendant’s activity.”[19] Depending on the facts, a defendant’s regular flow or regular course of sale in the forum could make the exercise of jurisdiction foreseeable to the defendant.[20] Likewise, jurisdiction could be foreseeable based on “something more” than this, evidencing an intent to serve the forum.[21]

Applying these principles to the facts at hand, the First Circuit held that Schechtl’s sales, through MetalForming, of forty-five machines and 234 parts into Massachusetts, totaling $1.5M, constituted a regular flow or course of sales and was readily distinguishable from the single isolated sale at issue in J. McIntyre.[22] The fact that these sales were a small fraction of a nationwide sales effort did not preclude jurisdiction. Instead, the question was whether Schechtl’s connection with Massachusetts was such that the exercise of jurisdiction was voluntary and foreseeable. The First Circuit further noted that its opinion did not merely rest on the volume of sales. Schechtl supplied each machine in response to purchaser-provided specifications and required that MetalForming include, with each machine, materials that instructed that purchaser to contact Schechtl directly.[23] The Court thus found that Schechtl voluntarily opened direct links to at least forty-five Massachusetts purchasers; links which are kept open over many years and presumably used, as evidenced by sale of 234 spare parts.[24] Schechtl’s channels to Massachusetts purchasers “constitute[d] efforts to continue – and perhaps to expand – its relationship with those purchasers.” The Court determined that these links were relevant to the jurisdictional analysis and further supported the exercise of jurisdiction here is foreseeable.[25] The Court concluded that, unlike the foreign manufacturer in J. McIntyre, “[t]his case involves a manufacturer which can direct where its products go, which sold dozens of expensive products into the forum over nearly two decades, and which initiated an ongoing relationship with its in-forum purchasers.”[26]

  1. Conclusion

The First Circuit’s opinion in Knox provides instructive guidance in applying the Supreme Court’s varying articulations of the “stream-of-commerce” / purposeful availment tests to foreign manufacturers. The decision reaffirms that the analysis requires a highly fact-specific inquiry and that no formulation of the test can be mechanically applied. The Court distinguished a manufacturer who merely places of a product into the stream-of-commerce resulting in a single sale to the forum state from a manufacturer who establishes a regular course of sales and channels of communication with forum customers, albeit through an independent distributor and as part of a nationwide sales effort. Most importantly, the Knox decision affirms that a foreign manufacturer, who seeks to engage forum customers, cannot avoid jurisdiction from product liability suits merely by asserting that it did not target the forum specifically.

[1] Case Nos. 18-1550, 18-1551 (Opinion of Lynch, J., joined by Stahl, J. and Barron, J.).

[2] Int’l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945).

[3] PREP Tours, Inc. v. Am. Youth Soccer Org., No. 17-1223, 2019 WL 126221, at *4 (1st Cir. Jan. 8, 2019).

[4] 444 U.S. 286, 297-98 (1980).

[5] 480 U.S. 102, 112 (1987).

[6] Id.

[7] Id.

[8] 564 U.S. 873 (2011).

[9] Id. at 886, 888-89.

[10] Id. at 881-82.

[11] Id. at 882.

[12] Id. at 890.

[13] Id. at 887, 888.

[14] Id. at 889 (citing Asahi, 480 U.S. 102, 111-12, 117, 122 (1987) (O’Connor, J.) (requiring “something more” than simply placing “a product into the stream of commerce,”); (Brennan, J.) (arguing that jurisdiction should lie where a sale in a State is part of “the regular and anticipated flow”, but not where that sale is only an isolated occurrence); (Stevens, J.) (indicating that “the volume, the value, and the hazardous character” of a good may affect the jurisdictional inquiry and emphasizing Asahi’s “regular course of dealing”).

[15] Plixer Int’l, Inc. v. Scrutinizer GmbH, 905 F.3d 1, 10 (1st Cir. 2018) (quoting Marks v. United States, 430 U.S. 188, 193 (1977)); Williams v. Romarm, SA, 756 F.3d 777, 784 (D.C. Cir. 2014); Ainsworth v. Moffett Eng’g, Ltd., 716 F.3d 174, 178 & n.14 (5th Cir. 2013); AFTG-TG, LLC v. Nuvoton Tech. Corp., 689 F.3d 1358, 1363 (Fed. Cir. 2012).

[16] Knox, Opinion of Lynch, J., Jan. 30, 2019, at 13, 15 (internal quotations omitted).

[17] Id. at 13 (internal quotations omitted).

[18] Id. at 14 (quoting Plixer, 905 F.3d at 9).

[19] Id. at 18 (quoting Burger King v. Rudzewicz, 471 U.S. 462, 475 (1985); PREP Tours, 2019 WL 126221, at *6).

[20] Id.

[21] Id. (citing Asahi, 480 U.S. at 111-12 (O’Connor, J.)).

[22] Id. at 15-16.

[23] Id. at 17.

[24] Id. at 18.

[25] Id.

[26] Id. at 18-19

In a 6-3 ruling on March 19, 2019, the United States Supreme Court held that, under maritime law, a product manufacturer has a duty to warn when its “bare metal” product requires incorporation of a part the manufacturer knows or has reason to know is likely to be dangerous, such as asbestos-containing components.

In Air & Liquid Systems Corp., et al. v. DeVries, No. 17-1104, 586 U.S. ___ (2019), the Supreme Court examined the scope of a manufacturer’s duty to warn of the dangers of asbestos when its own bare metal products are later combined with asbestos-containing parts that the manufacturer did not make or sell. Plaintiffs Kenneth McAfee and John DeVries (“Plaintiffs”) filed suit in state court against a number of product manufacturers alleging that they developed cancer as a result of exposure to asbestos-containing equipment, including pumps, blowers, and turbines manufactured by the defendants, while serving on U.S. Navy vessels.[1] Plaintiffs asserted, inter alia, that defendants were negligent in failing to adequately warn of the dangers associated with the use of their equipment, even though the defendant-manufacturers of the equipment at issue did not always incorporate asbestos into their products and instead delivered much of the equipment to the Navy without asbestos, in a condition known as “bare metal.” Defendants removed to federal district court under maritime jurisdiction and subsequently moved for summary judgment based on the “bare-metal defense.” The District Court granted the motions for summary judgment, and Plaintiffs appealed. The United States Court of Appeals for the Third Circuit vacated and remanded, holding that “a manufacturer of a bare-metal product may be held liable for a plaintiff’s injuries suffered from later-added asbestos-containing materials” if the manufacturer could foresee that its product would be used with later-added asbestos-containing parts. In re Asbestos. Prods. Litig., 873 F.3d 232, 240 (3d Cir. 2017). The United States Supreme Court granted certiorari to resolve inconsistency among the Courts of Appeals regarding the validity and application of the bare-metal defense under maritime law. Continue Reading “Bare-Metal” Defense Treading Water Under Maritime Law