NELF amicus brief supporting FCA US LLC SJC 13354
On January 13, 2023, Ben Robbins, Senior Staff Attorney for the New England Legal Foundation, filed an amicus brief for NELF in the Massachusetts Supreme Judicial Court (SJC) in Doucet et al. v. FCA US LLC, responding to the Court’s request for amicus briefs on the issue whether a court of Massachusetts can exercise personal jurisdiction over a nonresident auto manufacturer with the respect to the product liability claims of the plaintiff, a resident of New Hampshire who purchased a used Chrysler car in New Hampshire and subsequently suffered an injury, in New Hampshire, resulting from an auto accident in his car, in New Hampshire. (The plaintiff had initially filed in New Hampshire state court, the defendant removed to federal court for the District of New Hampshire, on diversity ground, and that court dismissed the case for lack of personal jurisdiction. However, the plaintiff did not appeal that decision to the First Circuit.)
The plaintiff, Paul Doucet, is a resident of New Hampshire. In 2013, he purchased, in New Hampshire, a used 2004 Chrysler Sebring manufactured by DaimlerChrysler Motors Corp., LLC, the predecessor in interest to the defendant, FCA US LLC, in a private sale with the car’s then-owner, also a New Hampshire resident. In 2015, the plaintiff was riding in the front passenger seat of his car, in New Hampshire, when the car was involved in a front-end collision, causing the plaintiff to suffer severe injuries, in New Hampshire.
In 2003, ten years before the plaintiff purchased the car in New Hampshire, DaimlerChrysler invoiced and shipped the car to a Rhode Island Chrysler dealership, which transferred the car to a Massachusetts Chrysler dealership, which, in turn, leased and then sold the car to a Massachusetts resident. The vehicle was then resold in Massachusetts, before being sold, in 2010, to the New Hampshire resident who, in turn, sold the car to the plaintiff, in 2013.
The short answer to the Court’s amicus question is no, a court of the Commonwealth cannot exercise personal jurisdiction over the nonresident defendant auto manufacturer, because the fact pattern of this case connects the plaintiff’s claims with his state of residence, New Hampshire, and not with the forum state of Massachusetts. Indeed, this fact pattern is on all fours with Bristol-Myers Squibb Co. v. Superior Ct. of California, San Francisco County, 137 S. Ct. 1773 (2017) (no personal jurisdiction under Due Process Clause of United States Constitution over nonresident manufacturer with respect to product liability claims of nonresident plaintiffs who purchased, used, and allegedly suffered harm from allegedly defective product in their states of residence). Consistent with the Due Process Clause and Bristol-Myers, personal jurisdiction should also not lie under the relevant provision of the Massachusetts long-arm statute, G. L. c. 223A, § 3(a), which provides that “A court may exercise personal jurisdiction over [a nonresident defendant] . . . as to a cause of action in law or equity arising from the [defendant’s] (a) transacting any business in this commonwealth.” See Oracle USA, Inc. v. Comm’r of Revenue, 487 Mass. 518, 525 (2021) (“When statutory language is susceptible of multiple interpretations, a court should avoid a construction that raises constitutional doubts and instead should adopt a construction that avoids potential constitutional infirmity.”) (emphasis added).
Significantly, all of the jurisdictionally relevant facts underlying the plaintiff’s claims–i.e., the state where the plaintiff lives, the state where he purchased the car, and the state where he suffered the auto accident and resulting injury–point to New Hampshire, and not Massachusetts, as the state with the legitimate interest in exercising personal jurisdiction over FCA US. New Hampshire, and not Massachusetts, “ha[s] significant interests at stake–providing [its] residents with a convenient forum for redressing injuries inflicted by out-of-state actors, as well as enforcing [its] own safety regulations.” Ford Motor Co. v. Montana Eighth Judicial Dist. Ct., 141 S. Ct. 1017, 1030 (2021) (cleaned up). In so allocating personal jurisdiction between sister states, “[t]he law of specific [or case-linked] jurisdiction thus seeks to ensure that States with little legitimate interest in a suit do not encroach on States more affected by the controversy.” Ford, 141 S. Ct. at 1025 (discussing principle of “interstate federalism” animating due process limits on forum’s exercise of personal jurisdiction over nonresident defendant) (emphasis added).
Nothing in the Massachusetts long-arm statute is to the contrary. That statute provides, in relevant part, that “[a] court may exercise personal jurisdiction over [a nonresident defendant] . . . as to a cause of action in law or equity arising from the [defendant’s] (a) transacting any business in this commonwealth.” G. L. c. 223A, § 3(a) (emphasis added). This statutory language imposes two requirements: that the defendant was sufficiently transacting business in the Commonwealth at the time of the incident, and that the plaintiff’s claims “arise from” that in-state activity. See Tatro v. Manor Care, Inc., 416 Mass. 763, 767 (1994) (discussing same). The “arising from” requirement means that the defendant’s Massachusetts contacts must be the but-for cause of the plaintiff’s subsequent out-of-state injury. See Tatro, 416 Mass. at 770-71.
Even if the defendant were sufficiently transacting business in Massachusetts at the time of the accident, the plaintiff’s claims could not satisfy the long-arm statute because they did not “arise from” the defendant’s Massachusetts contacts. First, neither the defendant nor its predecessor in interest, DaimlerChrysler, introduced the plaintiff’s car to the Massachusetts market. Instead, that step was accomplished by the Rhode Island and Massachusetts dealerships, which are independent and legally separate corporate entities. Indeed, nothing in the long-arm statute “displace[s] bedrock principles of corporate common law. . . . One of the basic tenets of that body of law is that corporations–notwithstanding relationships between or among them–ordinarily are regarded as separate and distinct entities.” Scott v. NG U.S. 1, Inc., 450 Mass. 760, 765–66 (2008) (emphasis added).
Accordingly, the Massachusetts contacts of the dealerships should not be imputed to the nonresident defendant manufacturer, because they are each a separate and distinct legal entity. This result would apply even if the dealerships had been subsidiaries of the defendant, and even if the defendant had exercised control over their operations. “Massachusetts respects the corporate form. . . . Even where a non-resident parent owns the controlling share of a subsidiary doing business in Massachusetts, personal jurisdiction does not exist unless the stringent Massachusetts veil-piercing test is satisfied.” In re Lupron Mktg. & Sales Practices Litig., 245 F. Supp. 2d 280, 298 (D. Mass. 2003) (declining, under Massachusetts long-arm statute, to impute Massachusetts contacts of subsidiary to nonresident parent corporation) (citing My Bread Baking Co. v. Cumberland Farms, Inc., 353 Mass. 614, 618–19 (1968) (emphasis added)). See also Scott, 450 Mass. at 768 (“[C]ontrol, even pervasive control, without more, is not a sufficient basis for a court to ignore corporate formalities[.]”).
And nowhere does the plaintiff allege facts even suggesting any inter-corporate wrongdoing by the defendant that could warrant a court of the Commonwealth to disregard the corporate form that separates the defendant from the dealerships. See Andresen v. Diorio, 349 F.3d 8, 12 (1st Cir. 2003) (declining, under Massachusetts long-arm statute and Due Process Clause, to impute Massachusetts contacts of subsidiary to nonresident parent corporation, where plaintiff failed to allege or “show that the parent’s control in this instance was so pervasive and detailed as to invoke the sham or alter ego labels.”).
Second, even if the dealerships’ Massachusetts contacts were attributable to the defendant, the plaintiff’s claims would still not “arise from” those imputed contacts, because the defendant did not transact any business with the plaintiff in Massachusetts (or anywhere else, for that matter). After all, the Massachusetts dealership leased and then sold the vehicle in Massachusetts to third parties, who have nothing to do with the plaintiff. “[A] defendant’s relationship with a third party, standing alone, is an insufficient basis for [exercising personal] jurisdiction.” Bristol-Myers, 137 S. Ct. at 1780 (cleaned up) (emphasis added).
For this salient reason alone, Tatro is altogether distinguishable from this case. In particular, the plaintiff in Tatro was a Massachusetts resident who, in response to a California hotel’s solicitation of conference business in Massachusetts, reserved a hotel room with the California hotel in Massachusetts and subsequently suffered an injury in her reserved hotel room in California. See Tatro, 416 Mass. at 765-66. This initial contractual relationship, formed between the plaintiff and the defendant in Massachusetts, ultimately resulted in the plaintiff’s injury in California. See id. at 766. Accordingly, this Court concluded that the plaintiff’s claims “arose from” the defendant’s Massachusetts activity because that activity was the necessary “first step in a train of events that result[ed] in [the plaintiff’s] personal injury” in California. Tatro, 416 Mass. at 770.
Under Tatro, then, a Massachusetts plaintiff who alleges a personal injury suffered in another state must show that the nonresident defendant took the necessary “first step” with the plaintiff in Massachusetts that ultimately resulted in the out-of-state injury. In this case, however, the defendant never took any such necessary first step with the plaintiff in Massachusetts (or anywhere else). The only “first step” that the defendant took in Massachusetts with respect to the plaintiff’s car, if any at all, was with unrelated third parties. This is an inadequate basis for establishing personal jurisdiction. See Bristol-Myers, 137 S. Ct. at 1780 (discussing same). The lack of any “first step” between the plaintiff and defendant in Massachusetts distinguishes this case from Tatro and, therefore, prevents the plaintiff from establishing that his claims “arose from” the defendant’s Massachusetts activity under the long-arm statute.
In any event, Bristol-Myers should defeat the plaintiff’s attempt to establish personal jurisdiction under the Due Process Clause. In Bristol-Myers, the Supreme Court held that due process prohibited a court of the forum state of California from exercising specific personal jurisdiction over a nonresident manufacturer where, as here, the plaintiffs were residents of other states who purchased, used, and allegedly suffered harm from the allegedly defective product in their states of residence, and not in the forum state. “[T]he nonresidents were not prescribed [the drug] Plavix in California, did not purchase Plavix in California, did not ingest Plavix in California, and were not injured by Plavix in California.” Bristol-Myers, 137 S. Ct. at 1781.
This pointed summary by the Supreme Court of the key jurisdictional facts in Bristol-Myers applies with equal force to the jurisdictional facts in this case, i.e., a nonresident plaintiff who purchases, uses and suffers an injury from the allegedly defective product in his state of residence. In each case, there is virtually no nexus between the forum and the plaintiff’s claims.
In particular, the Due Process Clause requires the plaintiff to show that the defendant “purposefully avail[ed] itself of the privilege of conducting activities within the forum State,” and that the plaintiff’s claims “ar[o]se out of or relate[d] to the defendant’s contacts with the forum.” Ford, 141 S. Ct. at 1024-1025 (cleaned up). Even if FCA US purposefully availed itself of the Massachusetts market for selling its cars, the plaintiff could not show that his claims “arise out of or relate to” the defendant’s Massachusetts contacts.
First, as with this Court’s interpretation of the long-arm statute’s “arising from” language in Tatro, discussed above, the Supreme Court has held that a claim “arises out of” the defendant’s forum contacts if those contacts are the but-for cause of the claim. See Ford, 141 S. Ct. at 1026. For all of the reasons that amicus has stated above, the plaintiff cannot establish that FCA US’s Massachusetts contacts caused him to suffer injury in the car accident in New Hampshire.
Second, the plaintiff’s claims do not “relate to” the defendant’s forum contacts. Under this “relatedness” prong of the Supreme Court’s Due Process test, “there must be an affiliation between the forum and the underlying controversy, principally, an activity or an occurrence that takes place in the forum State and is therefore subject to the State’s regulation.” Ford, 141 S. Ct. at 1026 (cleaned up) (emphasis added). However, in this case, as in Bristol-Myers, the relevant activity or occurrence pertaining to the plaintiff’s claims–i.e., the purchase and use of the disputed product, and the personal injury allegedly resulting from its use–took place in the plaintiff’s state of residence, and not in the forum state.
In sharp contrast to Bristol-Myers and this case, the plaintiffs in the (consolidated) Ford case established personal jurisdiction because they were residents of the forum states, and they suffered injuries in the forum states from auto accidents involving the defendant’s vehicles that occurred in the forum states. See Ford, 141 S. Ct. at 1023. In short, the plaintiff’s product liability claims in this case align with the unsuccessful Bristol-Myers plaintiffs, and not with the successful Ford plaintiffs.
Moreover, even if the dealerships’ introduction of the disputed vehicle to the Massachusetts market were imputable to the defendant, those Massachusetts contacts would be irrelevant to establishing personal jurisdiction under the Due Process Clause, just as they would be irrelevant under Tatro and the long-arm statute, discussed above. See Ford, 141 S. Ct. at 1030 (rejecting defendant’s argument that plaintiffs should have filed suit in jurisdictions where defendant originally sold cars to third parties, or in jurisdictions where cars were designed or manufactured).
In rejecting the defendant’s argument that the plaintiffs should have sued in the states of original sale of their used vehicles, the Supreme Court in Ford first identified the significant interests of the forum states, where, unlike here, the plaintiffs resided and were injured from an auto accident–namely, “providing [their] residents with a convenient forum for redressing injuries inflicted by out-of-state actors, as well as enforcing their own safety regulations.” Ford, 141 S. Ct. at 1030 (cleaned up). In the case at bar, this rationale would apply to the plaintiff’s state of residence of New Hampshire, and not the forum state of Massachusetts.
The Court in Ford then contrasted these strong state interests with the remote and weak interest of the states of original sale (in this case, Massachusetts), in words that resonate strongly with the jurisdictional facts of this case:
For each of those States [of original sale], the suit involves all out-of-state parties, an out-of-state accident, and out-of-state injuries; the suit’s only connection with the State is that a former owner once (many years earlier) bought the car there. In other words, there is a less significant relationship among the defendant, the forum, and the litigation [in the state of original sale]. . . . [Such a] regime would undermine, rather than promote, what [Ford] calls the Due Process Clause’s ‘jurisdiction-allocating function.’
Ford, 141 S. Ct., at 1030 (emphasis added).
In sum, Ford precludes the state of original sale of the plaintiff’s vehicle from exercising personal jurisdiction over the nonresident manufacturer when, as here, “the suit involves all out-of-state parties, an out-of-state accident, and out-of-state injuries.” Ford, 141 S. Ct., at 1030. Therefore, the plaintiff cannot establish that his claims “relate to” the defendant’s Massachusetts contacts under the Due Process Clause. Accordingly, this Court should affirm the Superior Court’s dismissal of this case for lack of personal jurisdiction.
Finally, the SJC asked whether the plaintiff should be entitled to jurisdictional discovery, if the Court concludes that he has not established personal jurisdiction at this stage of the case. Ben argued for NELF that the plaintiff should not be entitled to jurisdictional discovery. In addition to the defendant’s argument that the plaintiff has waived this issue, by failing to raise it below, the plaintiff has also failed to allege jurisdictional facts that could satisfy either the long-arm statute or due process. It bears repeating that the plaintiff alleges that he is a resident of New Hampshire who purchased the vehicle in New Hampshire, was in an auto accident in New Hampshire, and suffered an injury in New Hampshire. For all of the reasons that amicus has discussed above, none of these jurisdictional facts “arose from” the defendant’s Massachusetts activity under the long-arm statute, or “arose out of or related to” the defendant’s Massachusetts contacts under the Due Process Clause.
Therefore, no amount of discovery in the world could change the fact that the plaintiff cannot establish specific personal jurisdiction over the defendant in Massachusetts. See B. Bullen v. Cohnreznick, LLP, 35 Mass. L. Rptr. 557, 2019 WL 3331280, at *2 n.4 (Mass. Super. June 17, 2019) (Salinger, J.) (“Trial courts have broad discretion to decide whether discovery is required on the issue of personal jurisdiction. . . . [T]he undisputed facts . . . make it clear that any exercise of general jurisdiction over [the defendant] would be unconstitutional. No discovery can change the fact that [the defendant] is not at home here.”) (cleaned up). Simply put, the plaintiff’s “failure to allege specific contacts, relevant to establishing personal jurisdiction [in Massachusetts], in a jurisdictional discovery request [should] be fatal to that request.” Pettengill v. Curtis, 584 F. Supp.2d 348, 361 (D. Mass. 2008) (cleaned up).