Hill v. Brush Engineered Materials, Inc.Hill v. Brush Engineered Materials, Inc.
MEMORANDUM
Bеfore the Court are two concurrent motions: a Rule 12(b)(2) Motion to Dismiss for Lack of Personal Jurisdiction filed by Defendant Brush Engineered Materials, Inc. (BEMI), Paper No. 25, and a Rule 12(b)(6) Motion to Dismiss Count IV filed by Defendants BEMI and Brush Wellman, Inc. (Brush), Paper No. 26. Through these motions, Defendants also seek dismissal of Plaintiffs punitive damages claims and all claims against BEMI. For the reasons that follow, the Court will grant Defendant BEMI’s jurisdictional motion and grant Defendants’ partial motion to dismiss with leave to amend. The Court will also dismiss Plaintiffs punitive damages claims and all claims against BEMI.
I. FACTUAL AND PROCEDURAL BACKGROUND
Plaintiff Regina Hill alleges the following facts in her Complaint. From 1992 to 2004, she was employed as a dental technician at the Roy-L Dental Lab in LaVale, Maryland. While there, she performed various tasks involving beryllium-containing dental alloys, which produced respira-ble beryllium dust. In 2005, she was diagnosed with chronic beryllium disease.
Plaintiff does not dispute that Defendants BEMI and Brush are separate corporate entities and that BEMI has never manufactured or sold any form of beryllium. Defendant BEMI is an Ohio-based holding company and Brush’s parent compаny. Defendant Brush is a manufacturer of beryllium and beryllium-containing products. Plaintiff alleges that Defendant Brush sold its products to Defendants Pentron Laboratory Technologies, LLC, (Pentron) and Jensen Industries, Inc. (Jensen) and that these entities supplied
On January 28, 2005, Plaintiff filed suit against Defendants BEMI, Brush, Jensen, and Pentron. Plaintiff claims that Defendants manufactured, assembled, or distributed'beryllium-containing'products used at Roy-L Dental Lab. She claims workplace exposure to beryllium caused her to contract chronic beryllium disease. Plaintiffs Complaint lists four causеs of action: negligence (Count I), strict liability (Count II), breach of warranty (Count III), and fraudulent concealment and civil conspiracy (Count IV) 1 .
II. DISCUSSION
A. Personal jurisdiction over BEMI
Defendant BEMI moves, pursuant to
A district court’s exercise of personal jurisdiction over a nonresident defendant must comply with the requirements of both the. forum state’s long-arm statute and the Due Process Clause of the Fourteenth Amendment.
Id.
The Court of Appeals of Maryland has consistently held thаt Maryland’s long-arm statute expands the exercise of personal jurisdiction to the limits set by the Due Process Clause of the Constitution.
E.g., Mohamed v. Michael,
A court may exert either general or specific jurisdiction over a nonresident defendant.
Helicopteros Nacionales de Colom., S.A., v. Hall,
Here, the undisputed statements of fact show that BEMI’s activities in Maryland do not provide grounds for Maryland to assert general jurisdiction. BEMI’s Vice President, Treasurer and Secretary, Michael C. Hasychak, asserts by sworn affidavit that BEMI has never maintained an office or conducted business in Maryland, nor has it owned property or maintained bank accounts in the state. It has nеver had employees, agents or representatives conduct business within Maryland or visit the state for business purposes, nor has it advertised or solicited business in the state. Plaintiff does not dispute these assertions.
Instead, Plaintiff contends that this Court should assert specific jurisdiction over BEMI because it has negligently designed and implemented environmental, health, and safety policies that caused Plaintiffs injuries. 2 She claims that “BEMI established and enforced these policies for its subsidiaries,” thereby establishing its corporate liability. Pl.’s Opp’n to BEMI’s Mot. to Dismiss at 5. To support this contention, Plaintiff submits a document she dubs “Brush Engineered Materials, Inc. Environmental Health & Safety Policy,” although the actual title reads “Brush Wellman Engineered Materials Environmental, Health & Safety Policy.” 3 Compare Pl.’s Opp’n at 5 with id. Ex. 1. Contrary to Plaintiffs assertions, the names “Brush Engineered Materials, Inc.” and “BEMI” do not appear anywhere on the exhibit. 4
Aside from the erroneously attributed Brush policy, Plaintiff does not specifically allege any independent tortious conduct by BEMI. Instead, she seeks to hold BEMI liable for the conduct of its subsidiaries, under a theory of liability that shе has already abandoned.
See supra
note 1. For example, she claims BEMI breached its duty “to design reasonably safe products, to communicate an adequate warning of the dangers involved in the use of their products, and to provide adequate instructions for product use to avoid or minimize dangers.” Pl.’s Opp’n to BEMI’s Mot. at
5.
In making these assertions, however, Plaintiff does not contest BEMI’s sworn
This Court does not have jurisdiction over BEMI in this matter. The Fourth Circuit states “[a]lthough it is true that the plaintiff opposing a
Plaintiff requests leave to conduct jurisdictional discovery in the event this Court finds it lacks grounds to exercise personal jurisdiction over BEMI. “District courts have broad discretion in [their] resolution of discovery problems.”
Mylan,
Here, Plaintiff has offered nothing but erroneous or conclusory assertions about BEMI’s contacts with Maryland. She has failed to proffer any further facts that, if proven, would affect this Court’s exercise of jurisdiction.
See ALS Scan, Inc. v. Digital Service Consultants, Inc.,
B. Defendants’ 12(b)(6) motion for failure to state a claim
Defendants argue thаt Count IV of the Complaint fails to state a claim upon which relief can be granted. The Fourth Circuit permits dismissal for failure to state a claim only if “after accepting all well-pleaded allegations in the plaintiffs complaint as true and drawing all reasonable factual inferences from those facts in the plaintiffs favor,” it still appears certain that the plaintiff can prove no set of facts in support of her claim which would entitle her to relief.
Edwards v. City of Goldsboro,
1. Fraudulent concealment and conspiracy under
Plaintiff has satisfied the low threshold of
a. Fraudulent concealment
Defendants argue dismissal is proper because Plaintiffs claim of fraudulent concealment fails to allege all of the essential elements of the tort. Defs.’ Mot. to Dismiss at 2. Under Maryland law, the elements of fraudulent concealment are: “1) that the defendant owed a duty to the plaintiff to disclose a material fact, 2) that the defendant failed to disclose that fact, 3) that the defendant intended to defraud or deceive the plaintiff, 4) that the plaintiff took action in justifiable reliance on the concealment, and 5) that the plaintiff suffered damages as a result of the defendant’s concealment.”
Deckelbaum v. Cooler, Mangold, Tompert & Chapman, P.L.L.C.,
Defendant Brush maintains it owed Plaintiff nо duty to disclose. Under Maryland law, a duty to disclose can arise either “when one party is in a fiduciary or confidential relationship with the other,” or “when one party makes a partial and fragmentary statement of fact.”
Estate of White ex rel. White v. R.J. Reynolds Tobacco Co.,
Plaintiff alleges that Defendant Brush had a duty to disclose to her because it had partially disclosed facts. Among other charges, she asserts that Defendant Brush publicly stated that the 2 microgram standard was safe for all persons when it knew that this standard was not safe for those susceptible to beryllium. Compl. ¶41. Accepting this allegation as true and drawing all reasonable factual inferences in Plaintiffs favor, as is necessary in a motion to dismiss, the Court finds that this statement amounts to a suppression of truth intended to defraud, and one upon which Plaintiff asserts she relied to her detriment. Compl. ¶45. Thus, Plaintiff has satisfactorily plead the duty element of her fraudulent concealment claim.
Defendant Brush incorrectly asserts that such partial or fragmentary suppres-sions of truth must be made to the plaintiff to constitute fraud. To the contrary, “Maryland law has long allowed plaintiffs to sue for injuries caused by fraudulent misrepresentations made to third parties,” sо long as the plaintiff could reasonably have been expected to act or refrain from action in reliance upon the misrepresentation.
b. Conspiracy
Defendants then argue that Plaintiffs civil conspiracy claims are legally insufficient to withstand dismissal. In Maryland, “a civil conspiracy is a combination of two or more persons by an agreement or understanding to accomplish an unlawful act or to use unlawful means to accomplish an act not in itself illegal, with the further requirement that the act or means employed must result in damages to the plaintiff.”
BEP, Inc. v. Atkinson,
Here, Plaintiff has plead the elements of conspiracy under
Defendants argue correctly that to the extent that Plaintiffs conspiracy claims are based upon an attempt to defraud the federal government, they are preempted under
Buckman Co. v. Plaintiff’s Legal Comm.,
Plaintiff, however, alleges two other conspiracies in which Defendant Brush and its co-conspirators attempted to defraud beryllium workers and the public, both groups of which she is a member. Compl. ¶ 42(a), 43. These claims rely on traditional state tort law and are not preempted by
Buckman. See Dawson v. Ciba-Geigy Corp.,
2. Rule 9(b)’s particularity requirements
While each of the claims, as explained above in Section II-B-1, has sufficient facts to remain viable under
a. Fraudulent concealment
The parties dispute the proper application of Rule 9(b) to Plaintiffs fraudulent concealment claim. Defendants argue that, even if Plaintiff has generally plead each element of fraud, her claim does not satisfy the heightened pleading requirement of Rule 9(b), which demands that all claims of fraud be plead with particularity.
10
The Court sees no reason to ignore
Although Plaintiff has generally plead the еlements of her fraudulent concealment claim, she has not plead them with adequate particularity under
b. Conspiracy
Plaintiffs conspiracy claims are similarly susceptible to dismissal. Claims of conspiracy to commit fraud must abide by
Plaintiffs conspiracy claims are unable to withstand Defendants’ motion to dismiss because she has not stated the claims’ elements with the particularity required by
c. Leave to amend
Plaintiff requests leave to amend her complaint should this Court find her pleadings insufficient. Rule 15(a) provides that leave to amend “shall be freely given when justice so requires.” Fed. R. Crv. P. 15(a). The Supreme Court has said that refusal of such leave, without a justifying reason, is not only an abuse of discretion but “inconsistent with the spirit of the Federal Rules.”
Foman v. Davis,
3. Punitive Damages
Defendants argue that Plaintiff has failed to state a sufficient claim for punitive damages in Counts II and TV and ask for their dismissal. Defs.’ Mot. to Dismiss at 11. Because this Court will dismiss Count IV for failure to plead with particularity, it will only consider the motion to dismiss punitive damages in Count II at this time.
Plaintiff argues that her request for punitive damages for her strict liability claim (Count II) is adequate because she asserts that Defendant Brush either acted with certain knowledge of the dangerоusness of its product or purposely avoided learning of its dangers in deliberate disregard of the welfare of the product’s ultimate users.
See Owens-Illinois, Inc. v. Zenobia,
Maryland’s standard for punitive damages, however, requires more from the complainant. Specifically, a plaintiff seeking punitive damages for any tort must “allege, in detail, facts that, if proven true, would support the conclusion that the act
III. CONCLUSION
For these reasons, Defendant BEMI’s 12(b)(2) motion to dismiss for lack of personal jurisdiction will be granted and Defendants’ 12(b)(6) partial motion to dismiss for failure to state a claim will be granted. Plaintiff will be given 15 days from the date of this Order to move for leave to file an amended complaint. A separate order consistent with the reasoning of this Memorandum will follow.
Notes
. Count IV encompasses a hodgepodge of claims, including a claim of fraudulent misrepresentation and what appear to be numerous claims of civil conspiracy. To the extent that Plaintiff seeks to amend her Cоmplaint, the Court notes that severing the claims into separate counts should facilitate Plaintiff's necessaxy efforts to plead these claims with particularity and put Defendants on proper notice of their alleged misconduct.
.In opposition to BEMI's motion, Plaintiff maintains that BEMI’s parent relationship to its subsidiary is not the basis for this Court’s jurisdiction over BEMI. Pl.'s Opp’n to BEMI’s Mot. to Dismiss at 4 n. 6 (stating emphatically that BEMI’s arguments against piercing the corporate veil "are a red herring and should be disregarded”); but see id. stating, at 2, "BEMI, as the corporate parent, dictates ... policies for all of its subsidiaries” and ibid. n. 2, stating "BEMI by and through its many subsidiaries, operates manufacturing and other facilities .... ” Notwithstanding these somewhat inconsistent statements, which seem to indicate that Plaintiff does in fact want this Court to consider piercing BEMI’s corporate veil, Plaintiff insists that BEMI should be subject to this Court’s jurisdiction to answer for its "independent tortious conduct” in Maryland. Id. The Court accepts Plaintiff's assurance that piercing the corporate veil is not at issue here and will not consider it further. The Court’s inquiry is focused оn BEMI’s independent conduct.
. Plaintiff cites this document as "prima facie evidence” of BEMI's corporate liability on the case. Id.
. BEMI addresses this discrepancy in the Affidavit of Michael D. Anderson, President of Brush Wellman Inc., in which he unequivocally states that the policy is that of his company, Brush, and not that of BEMI. Def. BEMI’s Reply Ex. 1 (Anderson Aff. ¶ 4).
. Plaintiff cites
Combs v. Bakker
to support her discovery request.
. Defendant cites
Morgan
v.
Brush Wellman, Inc.,
. Although
Estate of White
claims that Maryland law supports no fraudulent misrepresentation cause of action for statements made to third parties, both that case and the case cited in support,
Parlette v. Parlette,
do not rule on that basis.
Parlette v. Parlette,
.
Estate of White
is in accord because that court granted summary judgment primarily because Plaintiff had no evidence that he relied upon the defendants’ statements.
Estate of White,
.Defendant argues that Plaintiff fails to plead an unlawful purpose or unlawful means, an act in furtherance of the conspiracy, or any damages to her. (Defs.’ Mot. to Dismiss at 9.) If Plaintiff satisfactorily- pleads the elements of fraudulent concealment, however, she also will have plead each of these elements of conspiracy. Defendant’s citation to
Harris v. Brush Engineered Materials, Inc.
is inapposite because the court there had dismissed the
.
. Other district courts have found that
. Of course, if subsequent discovery provides Plaintiff with a specific factual basis that justifies a request for punitive damages, she may move for leave to amend her Complaint accordingly.