The World in U.S. Courts: Spring 2015 - Personal Jurisdiction | February.19.2015
Plaintiff C&G Welding brought breach of contract and fraud claims against OPI International Nigeria, Ltd., Offshore Contractors, Inc., and James K. Cole ("Defendants") for non-payment of services rendered under a contract for work aboard the vessel Global Iroquois. C&G alleged that the defendants owed $234,079 for work performed under the parties' contract—an amount that the defendants said they would pay with a loan and/or line of credit from the Union Bank of Nigeria. C&G is a Louisiana corporation, while OPI is a non-U.S. corporation. Offshore Contracting is a Texas corporation and Cole is a Texas citizen. After C&G filed suit in state court, OPI removed the case to federal court and filed a motion to dismiss for lack of personal jurisdiction.
The District Court applied Louisiana's long-arm statute and focused its inquiry on whether an exercise of jurisdiction would comport with federal constitutional guarantees, considering whether (1) the defendant purposely availed itself of the benefits and protections of the forum state by establishing minimum contacts with the forum state; and (2) the exercise of jurisdiction over the defendant does not offend traditional notions of fair play and substantial justice.
Notwithstanding OPI's evidence that it does no business in Louisiana and had no contacts in the state, the District Court determined that C&G presented sufficient prima facie evidence that OPI maintained adequate minimum contacts with Louisiana to justify the exercise of specific jurisdiction. To support this finding, the District Court pointed to C&G's allegations that OPI was responsible for negotiating the line of credit for services performed under the Louisiana contract, assumed responsibility for payment of invoices issued by C&G, and that workers on the Global Iroquois, while docked in Louisiana, believed themselves to be employees of OPI Nigeria. The District Court further found that OPI seemingly availed itself of the protection of Louisiana law by entering into contracts in and having employees in the state. Finally, the court found that C&G's action unquestionably arose from OPI's alleged activities in Louisiana. The District Court thus concluded that it could assert jurisdiction over OPI.