Dillard v. Fed. Corp.
321 F. Supp. 3d 752
W.D. Tex.2018Background
- May 3, 2013: vehicle rolled over in Piedras Negras, Mexico; plaintiffs allege a Federal Corporation tire failure caused the crash and injuries.
- Plaintiffs sued Federal (a Taiwan corporation) in federal court in Texas for negligence and strict products liability.
- Federal moved to dismiss for lack of personal jurisdiction; court authorized jurisdictional discovery and initially granted the motion but later vacated that dismissal under Rule 60(b) and reconsidered jurisdiction.
- Discovery showed Federal shipped large quantities of tires to multiple Texas cities and was aware its products reached and were used by Texas consumers (including connection of Texas end users to dealers).
- The court analyzed both general and specific jurisdiction under the Due Process Clause and Fifth Circuit precedent, ultimately finding general jurisdiction lacking but specific jurisdiction satisfied.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| General jurisdiction | Federal not at home in Texas is incorrect; its continuous sales render it amenable | Federal is not incorporated or headquartered in Texas and lacks continuous/systematic contacts | Denied — court held no general jurisdiction (not "at home" in Texas) |
| Minimum contacts (stream-of-commerce) | Federal purposefully placed tires into the stream of commerce with expectation they would be sold/used in Texas | Federal lacked intent/knowledge; shipments and third-party sales are unilateral actions that do not create purposeful contacts | Held — under Fifth Circuit/Justice Brennan approach Federal had purposeful, minimum contacts with Texas |
| Relatedness (specific jurisdiction) | The accident arose from a tire that entered Texas commerce and was purchased/used by Texas consumers | Injury occurred in Mexico, so Texas contacts are unrelated | Held — plaintiffs' claim arises out of Federal's Texas-directed contacts (tire entered stream of commerce toward Texas) |
| Reasonableness (fair play & substantial justice) | Texas and plaintiffs have strong interests; burden on plaintiffs to sue in Taiwan is high | Litigation in Texas imposes substantial burden on an alien defendant (Taiwan) | Held — exercise of jurisdiction is reasonable; forum and plaintiff interests outweigh burdens on Federal |
Key Cases Cited
- Latshaw v. Johnston, 167 F.3d 208 (5th Cir. 1999) (two-part personal jurisdiction framework for diversity cases)
- Moncrief Oil Int’l v. OAO Gazprom, 481 F.3d 309 (5th Cir. 2007) (Texas long-arm statute reaches constitutional limits)
- Spir Star AG v. Kimich, 310 S.W.3d 868 (Tex. 2010) (Texas follows Asahi O’Connor plurality/stream-of-commerce-plus)
- Daimler AG v. Bauman, 571 U.S. 117 (2014) (general jurisdiction requires defendant to be "at home")
- Goodyear Dunlop Tires Ops., S.A. v. Brown, 564 U.S. 915 (2011) (general jurisdiction principles)
- Asahi Metal Indus. Co. v. Superior Court, 480 U.S. 102 (1987) (plurality and Brennan opinions on stream-of-commerce tests)
- Ainsworth v. Moffett Eng’g, Ltd., 716 F.3d 174 (5th Cir. 2013) (Fifth Circuit applies Brennan/awareness stream-of-commerce test)
- World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286 (1980) (limits of unilateral plaintiff actions in establishing contacts)
- Int’l Shoe Co. v. Washington, 326 U.S. 310 (1945) (minimum contacts and fair play & substantial justice standard)
- Bristol-Myers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017) (distinction between general and specific jurisdiction)
- BNSF Ry. Co. v. Tyrrell, 137 S. Ct. 1549 (2017) (illustration of limits of general jurisdiction)