Opinion ID: 2973876
Heading Depth: 3
Heading Rank: 3

Heading: Sixth Circuit Caselaw on Purposeful Availment

Text: The Sixth Circuit has adopted Justice O’Connor’s “stream of commerce plus” test from Asahi. In Bridgeport Music v. Still N the Water Publ’g, 327 F.3d 472, 480 (6th Cir. 2003), “we ma[d]e clear . . . our preference for Justice O’Connor’s stream of commerce ‘plus’ approach, for the 9 The case cited by the district court is not to the contrary. See Carter v. Lagloria Shipping, 1997 WL 423101, at  (E.D. La. July 24, 1997). That case involved whether general jurisdiction existed, and defendants there had not rigged their vessels for U.S. ports or otherwise designed their products for the U.S. market. No. 05-3792 Fortis Corp. Ins. v. Viken Ship Management, et al. Page 7 reasons set forth in that opinion . . .” As explained below, the facts of this case meet the “plus” requirement under Sixth Circuit precedent. The case of Mott v. Schelling & Co., 1992 U.S. App. LEXIS 13273 (6th Cir. May 29, 1992) is instructive. See also Tobin v. Astra Pharm. Prod., 993 F.2d 528, 544 (6th Cir. 1992) (favorably discussing Mott). Mott was injured in Michigan while operating an industrial saw manufactured by Schelling, an Austrian-based company. Mott and members of his family sued, inter alia, Schelling, which moved to dismiss the complaint for lack of personal jurisdiction. In outlining the requirements of the purposeful availment test, the Mott court held that “even a single act can support jurisdiction as long as it creates the required relationship with the forum state.” Mott, 1992 U.S. App. LEXIS 13273, at  (citing McGee v. Int’l Life Ins. Co., 335 U.S. 220, 223 (1957)). Schelling argued that it was not subject to the specific jurisdiction of the Michigan courts because it had no relevant contacts there. The offending saw was sold to Schelling’s U.S.-based agent the Proctor Corporation in Birmingham, Alabama, at which point Proctor obtained (and Schelling lost) title to the saw. The court of appeals noted that Schelling “actively cultivated its American market. United States standards were taken into account in the design and manufacture of the saw at issue.” Id. at  (emphasis added). Schelling’s employees had come to the United States to market and sell these machines; the court did not state that they marketed in Michigan specifically. In addition, a Schelling technician went to the plant in Michigan to install the saw and demonstrate the blade-change procedure. The appellate court concluded that specific personal jurisdiction existed over Schelling in Michigan. It held that Schelling “had to know” that the saw was destined for Michigan because it sent one of its technicians there. Moreover, Schelling knew its saws were being sold in the United States. The company actively cultivated its market here, and benefited from numerous U.S. sales, including the one in this case, over many years. Clearly Schelling cannot reasonably expect to sell a potentially dangerous product into the United States, exact its price, and then shirk any obligations that arise when its machine goes awry. Due process does not require us to allow Schelling to exploit this country’s vast, rich markets and at the same time avoid the jurisdiction of our courts. Under any formulation of the test, the district court properly exercised personal jurisdiction over Schelling. Id. at -18. The court’s ruling in Mott is noteworthy because it found sufficient contacts with Michigan based on sales to its distributor in Alabama. Schelling undoubtedly knew that its saw could end up in Michigan through the stream of commerce. Yet the only specific contact with Michigan (as opposed to the United States) that would qualify as a “plus” factor in the Asahi formulation is the technician’s installation of the saw in Michigan and demonstration of the blade-changing technique. In this case, defendants outfitted and rigged their ships to sail into the Great Lakes. Defendants confirmed in the Charter Agreement that “the vessel is suitable for Toledo.” JA 97. Defendants’ officers testified that the vessels were rigged to travel to the Great Lakes. They entered into a long-term agreement with a charterer that made its money shipping into the Great Lakes. Not counting travel time, they earned $558,000 for the number of days spent in Ohio ports over five years. Defendants had more than sufficient notice that they might be subject to jurisdiction here, No. 05-3792 Fortis Corp. Ins. v. Viken Ship Management, et al. Page 8 and had ample opportunity to pass on the costs of potential 10 liability to FedNav if they desired, or to require that FedNav avoid United States ports completely. See Asahi, 480 U.S. at 110. Defendants argue that the vessels were rigged to travel to countries other than the United States, and that the Great Lakes serves both the United States and Canada. Under the Asahi formulation, however, the crucial question is whether defendants designed their product for or directed their products to the forum state – not whether the United States was the exclusive market for the defendants’ products. See Asahi, 480 U.S. at 113 (citing Rockwell, discussed supra Part II.A.1.) (jurisdiction appropriate when custom-made ball bearings used in helicopters were sold in United States and Europe). In sum, defendants rigged their vessels to ship products to the Great Lakes ports, including Toledo. Pursuant to Asahi and Mott, this, plus the frequent calls to these ports, is sufficient to establish purposeful availment of the forum state.