M & C Corporation v. Erwin Behr GMBH & Co., KG
508 F. App'x 498
6th Cir.2012Background
- M & C seeks civil contempt against nonparties Deutsche Bank AG, Jens Schmelt, and Jan Hoetzel for alleged involvement in Behr asset sales.
- District court dismissed contempt as to Deutsche and Schmelt for lack of personal jurisdiction; Hoetzel not addressed on jurisdiction because Michigan resident.
- Behr (later Alpha-200 GmbH & Co., KG) had assets including Behr Industries; Behr previously held in contempt and injunctions restricted asset disposition.
- Behr sold assets in 2005 without notice to M & C or court-appointed receiver, prompting M & C to seek contempt against nonparties.
- Magistrate and district court required clear and convincing evidence and limited evidence; district court later denied sanctions for lack of evidence; M & C appealed the denial and reconsideration ruling.
- This appeal addresses whether the district court had personal jurisdiction over the nonparties and whether contempt was proven on the merits.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether district court had personal jurisdiction over Deutsche and Schmelt | M & C contends jurisdiction existed via general appearances | Deutsche/Schmelt argued no jurisdiction | Yes, court had personal jurisdiction via attorney general appearances. |
| Whether Deutsche and Schmelt were properly held in contempt | M & C asserts they knowingly aided violation of injunction | Defendants denied awareness or participation; insufficient evidence | Contempt failed on the merits; sanctions vacated. |
| Whether Deutsche Bank waived its personal-jurisdiction defense | Waiver through conduct or appearance should not be dispositive | Waiver due to general appearance or failure to raise early | Court adopts waiver under Gerber v. Riordan; Deutsche Bank waived. |
| Whether Schmelt waived his personal-jurisdiction defense | Schmelt maintained defense; conduct did not constitute waiver | Waiver via continuing participation in litigation | Schmelt did not waive; merits reviewed. |
| Whether district court’s contempt procedures were an abuse of discretion | Procedures violated rights to live testimony and discovery | Procedures reasonable; evidence inadequate | No abuse; dismissal affirmed for lack of evidence. |
Key Cases Cited
- Gerber v. Riordan, 649 F.3d 514 (6th Cir.2011) (waiver of personal jurisdiction via attorney general appearance; direct on-point for general-appearance waiver rule)
- Reebok International Ltd. v. McLaughlin, 49 F.3d 1387 (9th Cir.1995) (discusses personal jurisdiction and waiver in contempt context)
- Salmi v. Sec’y of Health and Human Servs., 774 F.2d 685 (6th Cir.1985) (waiver/consent concepts cited in jurisdiction context)