Court of Appeals Finds No "Tag Jurisdiction" For Corporations Whose officers Are Served In-State

The World in U.S. Courts: Fall 2014 - Personal Jurisdiction

Martinez et al. v. Aero Caribbean et al., United States Court of Appeals for the Ninth Circuit, August 21, 2014

Plaintiffs, heirs to a passenger killed in a plane crash in Cuba, sued defendant aircraft manufacturer Avions de Transport Régional ("ATR") in the U.S. District Court for the Northern District of California.  That court dismissed the complaint, which alleged defective design and construction, for lack of personal jurisdiction.  On appeal the Ninth Circuit found there was no personal jurisdiction over ATR, and upheld the district court's dismissal.

Plaintiffs offered two theories of personal jurisdiction: (1) that under the United States Supreme Court's 1990 decision in Burnham v. Superior Court, service of process on a corporation's officer within a state creates specific jurisdiction over the corporation; and (2) that ATR's contacts with California created general personal jurisdiction over it.

Plaintiffs initially served the summons and complaint on ATR in France.  When ATR moved to dismiss, the district court permitted limited discovery on jurisdiction.  During the discovery period, plaintiffs served the summons and complaint on ATR's Vice President of Marketing while he was in California for a conference.

The Ninth Circuit determined that "tag" jurisdiction, which, under Burnham, permits a federal court to exercise personal jurisdiction over a defendant personally served in-state, does not apply to corporations served through their officers.

The court then conducted an analysis of ATR's contacts with California to determine whether under the standard set out by the United States Supreme Court in 2014 in Daimler AG v. Bauman, the district court had general personal jurisdiction over ATR.  Daimler demands a defendant be "at home" in a state for the purposes of personal jurisdiction.  Here, ATR was a corporation organized under French law and headquartered in France, with no physical presence or license to do business in California.  While ATR had purchased parts from California, had sent representatives to California to promote its business, and had sold airlines to a California corporation, its California contacts were minor compared to its other contacts worldwide, and so it could not be said to be "at home" in California and there was no basis for an assertion of general personal jurisdiction.

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