The World in U.S. Courts: Spring 2014 - Personal Jurisdiction
March.13.2014
Plaintiffs, numerous U.S. retail corporations, alleged a widespread price fixing conspiracy among Chinese and Japanese corporations regarding cathode ray tubes (CRTs) in televisions and computer monitors. Defendants Beijing-Matsushita Color CRT Company and Thomson SA moved to dismiss for lack of personal jurisdiction. Beijing-Matsushita argued that it never sold CRTs or associated products in the U.S. or to U.S. customers. Instead, it sold some of its products in China to Defendant Panasonic, which ultimately sold them in the United States. Thomson SA similarly argued that it did not make or sell CRTs in the U.S. and that many of the allegations related to a corporate sibling, Thomson Consumer, rather than Thomson SA. The court addressed Beijing-Matsushita’s and Thomson SA’s motions in separate opinions.
As to Beijing-Matsushita, the retailer plaintiffs conceded a lack of general personal jurisdiction, but argued the court could assert specific personal jurisdiction because Beijing-Matsushita directed its price fixing activities at the United States, with knowledge the products would end up in the U.S., and that their claims arise out of those activities. Applying the Ninth Circuit’s test for specific personal jurisdiction, the court agreed, holding that Defendant purposefully directed its conspiracy at the forum by "fix[ing] CRT prices abroad and ensur[ing] that United States customers paid supracompetitive prices." The court found that the activities were sufficiently directed at the U.S. because Defendant shared U.S. pricing data with other defendants, coordinated pricing in relation to U.S. market conditions, attended meetings with co-defendants regarding U.S. pricing, and knew its products were destined for the U.S. In addition, the court held that exercising jurisdiction would be reasonable because, despite the risks of international comity and significant burdens of litigation, Beijing-Matsushita’s activities were specifically directed against the U.S. market and thus weighed heavily in favor of jurisdiction and outweighed other factors.
As to Thomson SA, the retailer Plaintiffs submitted affidavits with additional allegations of specific U.S. conduct. While the plaintiffs conceded the lack of general personal jurisdiction, they argued that Thomson SA took part in a list of meetings regarding price-fixing in the U.S. and participated in price negotiations for CRTs sold in North America. The court sided with retailer plaintiffs, finding Thomson SA had failed to rebut allegations of intentional acts directed at the U.S. while knowing "the effects of the activity will be felt there." Moreover, Thomson SA allegedly negotiated with Plaintiffs regarding U.S. CRT sales, which the court held would alone be sufficient to establish specific personal jurisdiction. The court also rejected Thomson SA’s arguments that jurisdiction would be overly burdensome, holding that although the company’s burden of litigation would be substantial due to the presence of documents in France and that it no longer owned the CRT business, such costs are "simply parts of modern, multinational litigation" and "foreign litigants must always deal with their home states’ laws." As such, the court held that Thomson SA’s "purposefully interjected" activities rendered exercising jurisdiction reasonable, considering "it is not plausible that a wealthy, multinational corporation like Thomson SA would be somehow overstressed at litigating one case, based on specific jurisdiction, in the United States."
[Editor’s Note: This decision also is addressed under the Antitrust Section of this report.]