Court Opinion

ID: 4249014
Source: CourtListenerOpinion
Date Created: 2018-02-28 18:16:30.711565+00
Date Added: 2024-06-11T09:24:08.980061
License: Public Domain

DISTRICT COURT OF APPEAL OF THE STATE OF FLORIDA
                              FOURTH DISTRICT

            ROLLS-ROYCE, PLC, a foreign profit corporation,
                           Appellant,

                                     v.

           SPIRIT AIRLINES, INC., a Florida Corporation,
        ROLLS-ROYCE CORPORATION, a foreign corporation,
  ROLLS-ROYCE NORTH AMERICA, INC., a foreign profit corporation,
   IAE INTERNATIONAL AERO ENGINES AG, a foreign profit entity,
                 PRATT & WHITNEY, a division of
 UNITED TECHNOLOGIES CORPORATION, a foreign profit corporation,
                           Appellees.

                              No. 4D17-1215

                            [February 28, 2018]

  Appeal of non-final order from the Circuit Court for the Seventeenth
Judicial Circuit, Broward County; Michael L. Gates , Judge; L.T. Case No.
CACE 16-012458.

  Stephanie G. Kolman, J. Thompson Thornton, and Clayton W.
Thornton of Clyde & Co US, LLP, Miami, for appellant.

  Eric D. Griffin, Jr. and Juan R. Serrano of Griffin & Serrano, P.A., Fort
Lauderdale, for appellee Spirit Airlines, Inc.

ON MOTION FOR REHEARING, MOTION FOR REHEARING EN BANC
           AND REQUEST FOR WRITTEN OPINION

KUNTZ, J.

   Rolls-Royce, PLC moves for rehearing directed to our opinion affirming
the circuit court’s denial of its motion to dismiss for lack of personal
jurisdiction. We agree that the court erred by denying its motion without
holding an evidentiary hearing to resolve disputed issues of fact. As a
result, we grant the motion for rehearing in part, withdraw our prior
opinion, and substitute this opinion in its place. In our holding, we reverse
the court’s order denying the motion to dismiss and remand for further
proceedings.
                                Background

    Around twenty minutes after Spirit Airlines Flight 165 departed
Dallas/Fort Worth International Airport for Hartsfield-Jackson Atlanta
International Airport, one of the Airbus A319’s engines exploded. Using
its other engine, the A319 safely returned to Dallas without injury to any
passengers or crew.

    Spirit filed a lawsuit in the Broward County Circuit Court relating to
the explosion, naming Rolls-Royce Corporation, Rolls-Royce North
America, Rolls-Royce, PLC, 1 IAE International Aero Engines AG, and Pratt
& Whitney, a division of United Technologies Corporation, as defendants.
In its complaint, Spirit asserted claims of negligence and gross negligence
against the three Rolls-Royce entities, gross negligence against IAE, and
gross negligence against Pratt & Whitney.

   In 2012, Rolls-Royce performed major repairs and alterations on the
engine at issue, including “removal, inspection and replacement of various
components of the Engine’s turbine as well as a restoration and
refurbishment of the Engine’s hot section.” After the repairs, the engine
was delivered to Spirit in Fort Lauderdale for “installation on the number
one position—on the left side—of one of Spirit's Airbus A319, identified as
Aircraft Registration No. N516NK.”

   Spirit also alleged that Rolls-Royce “took a $200 million share of the
Spirit Airlines order of the V2500-model engine,” stating that this shows
Rolls-Royce “actually participated to the tune of $200 million dollars in the
business component of Spirit’s utilizing the V2500 model engine in its
Florida operation.”

    Rolls-Royce moved to dismiss for lack of personal jurisdiction.
Attached to the motion to dismiss was an affidavit of Will Morris, the Chief
Counsel, Civil Aerospace, for Rolls-Royce. Within the affidavit, Mr. Morris
stated that Rolls-Royce is organized under the laws of the United Kingdom,
has its principal place of business in the United Kingdom, and maintains
all of its corporate records in the United Kingdom.

   Mr. Morris stated that Rolls-Royce did not design, manufacture, or sell
the subject engine; Rolls-Royce is not a shareholder, member, or
participant in IAE, nor a party to any contract between IAE and Spirit; and

1In its complaint, Spirit collectively refers to Rolls-Royce Corporation, Rolls-
Royce North America, and Rolls-Royce, PLC, as “Rolls-Royce.”

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Rolls-Royce did no work on the subject engine or subject aircraft in
Florida. Mr. Morris also stated that IAE and Rolls-Royce entered into an
agreement, to which Spirit was not a party, under which Rolls-Royce would
conduct V2500 engine repairs at Rolls-Royce’s engine repair facility in East
Kilbride, United Kingdom.

   Under Rolls-Royce’s contract with IAE, IAE had Spirit deliver the
subject engine to Rolls-Royce’s “East Kilbride repair facility for a scheduled
restoration shop visit.” Mr. Morris stated that any funds Rolls-Royce
received for work done on the subject engine were from IAE and not Spirit.
As for Spirit’s allegation that Rolls-Royce “took a $200 million share of
Spirit Airlines order of the V2500-model engine,” Mr. Morris stated that
the allegation is based on an ownership interest in IAE that Rolls-Royce
sold—and sold before any of the events alleged in Spirit’s complaint.

   Spirit responded to Rolls-Royce’s motion to dismiss, attaching various
documents. Spirit separately filed an affidavit of Jim Baumiller, Spirit’s
Director of Engineering and Technical Support. Mr. Baumiller stated that
when Spirit evaluated the V2500 engine for use and began operating the
V2500 engine, Rolls-Royce held around a one-third interest in IAE. He
stated that “[a]s far as Spirit is concerned, at all times during my tenure,
[Rolls-Royce] repaired, maintained and overhauled the majority of V2500
engines operated by Spirit in its Florida-based operation.”

    Mr. Baumiller asserted that “this Engine was serviced, inspected and
critical components overhauled by” Rolls-Royce, and that “after service,
inspection and overhaul, [Rolls-Royce] delivered the Engine directly from
the UK to Spirit in Florida.” He also stated that “along with the Engine,
[Rolls-Royce] delivered the written records and certifications of the
servicing, inspections and overhauls performed by [Rolls-Royce]. The
records were delivered directly to Spirit in Florida.” Finally, Mr. Baumiller
provided information relating to four other engines repaired by Rolls-
Royce, and ultimately delivered to Spirit.

    In reply, Rolls-Royce filed an affidavit of Alan Kelly, the Customer
Business Manager for Rolls-Royce V2500, BR710, and TAY engines. Mr.
Kelly stated that he is personally familiar with Rolls-Royce’s contract with
IAE and with Rolls-Royce’s “role in providing service to certain
components” of Spirit’s V2500 series engines. Rolls-Royce sold its interest
in IAE in mid-2012, however, continued to provide service to IAE under an
agreement he states is “customarily referred to as the Common
Maintenance Center Agreement or ‘CMC Agreement.’” Pursuant to that
CMC Agreement, Rolls-Royce performed work on engines for IAE,

                                      3
including engines owned by airlines with which IAE had “Fleet Hour
Agreements.”

    A Fleet Hour Agreement, he explained, works in concert with the CMC
Agreement. Under the Fleet Hour Agreement, IAE’s customers notify IAE
when an engine requires service, and Rolls-Royce has “no involvement
whatsoever” in the process. IAE then directs its customer, the airline, to
ship the engine to one of the facilities that IAE has a CMC Agreement with
for service to the engine. Rolls-Royce operates one of those facilities, the
facility in the United Kingdom.

   Spirit and IAE, according to Mr. Kelly, entered into a Fleet Hour
Agreement in April 2005, “pursuant to which IAE agreed to manage a
select number of Spirit Airlines’ V2500 engines.” Under that agreement,
IAE designated the specific engine to be shipped to Rolls-Royce for
“planned/convenience purposes.” Rolls-Royce was not involved in IAE
selecting its facility to service this engine and “had no role in the transport
or shipment of the engine to the United Kingdom.” After Rolls-Royce
completed the work on the subject engine, and after “it [was] fully
reassembled, it [was] placed back on the engine stand which is the
property of the airline, and covered in the airline engine bag.” Rolls-Royce
then notifies IAE that the engine is available for release.

   Finally, Mr. Kelly stated that Rolls-Royce “does not pay for, coordinate,
or arrange for the return shipment of engines delivered to it pursuant to
IAE’s arrangements as described above. Rather, pursuant to the CMC
Agreement . . . IAE and/or its agent is directly responsible for coordinating
the return of the engine to IAE’s customer, who in this case was Spirit
Airlines.” He also disputed Mr. Baumiller’s assertion that Rolls-Royce
directly delivered the accompanying paperwork to Spirit in Florida.
Instead, Mr. Kelly stated that Rolls Royce released the records to a
representative of IAE “who took custody and possession of the engine and
placed it on a lorry at the loading dock of [Rolls-Royce] in East Kilbride,
Great Britain.”

   After the briefing was complete, the circuit court held a hearing. Spirit
conceded that it was only requesting that the court exercise specific
personal jurisdiction over Rolls-Royce. After the hearing, the court asked
counsel to submit proposed orders on the motion and later rendered an
order denying Rolls-Royce’s motion to dismiss.          Rolls-Royce timely
appealed the court’s order.

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                                       Analysis

   We review a court’s order denying a motion to dismiss for lack of
personal jurisdiction de novo. NHB Advisors, Inc. v. Czyzyk, 95 So. 3d
444, 447 (Fla. 4th DCA 2012).

   Whether a Florida court has personal jurisdiction over a non-resident
defendant involves a two-step inquiry. Venetian Salami Co. v. Parthenais,
554 So. 2d 499, 502 (Fla. 1989). First, the court must determine whether
the complaint alleges sufficient jurisdictional facts to bring the action
within Florida’s long-arm statute. 2 Id. If the plaintiff has met its burden
in the first step, the court must determine whether sufficient “minimum
contacts” are shown between the non-resident defendant and Florida to
satisfy due process. Id.

    Personal jurisdiction can be “specific” or “general.” Marina Dodge, Inc.
v. Quinn, 134 So. 3d 1103, 1106–07 (Fla. 4th DCA 2014). Specific personal
jurisdiction exists when “the alleged activities or actions of the defendant
are directly connected to the forum state.” Caiazzo v. Am. Royal Arts Corp.,
73 So. 3d 245, 250 (Fla. 4th DCA 2011). On the other hand, general
personal jurisdiction exists when “the defendant’s connection with the
forum state is so substantial that no specific or enumerated relationship
between the alleged wrongful actions and the state is necessary.” Id.

    Spirit first alleged that Rolls-Royce “engages in substantial, systematic,
and non-isolated business activities throughout the United States,
including Florida.” Yet it has since withdrawn its claim that Rolls-Royce
is subject to the general personal jurisdiction of the Florida courts. This
allegation therefore is insufficient to satisfy the first inquiry.

    Limited then to specific personal jurisdiction, Spirit must rely on its
assertion that Rolls-Royce committed a tort in Florida. Under section
48.193(1)(b), Florida Statutes (2013), the Florida courts have personal
jurisdiction over a non-resident defendant if that defendant committed a
tortious act within the state. Generally, Spirit asserts that Rolls-Royce did
so by delivering “the sinister engine to Florida for installation on the
subject aircraft in Florida.” Spirit argues that the jurisdictional discovery
in the record “establishes that such return to service was accomplished
via [Rolls-Royce’s] Maintenance Release and other records which were
prepared by [Rolls-Royce], packaged with the subject engine and sent by
[Rolls-Royce] directly to Spirit in Florida where they were received and
relied upon by Spirit’s technicians in reinstalling the engine.”

2   See § 48.193, Fla. Stat. (2013).

                                          5
   In Rolls-Royce’s first responsive pleading, however, it filed the motion
to dismiss and accompanying affidavits discussed above in detail. Based
on the complaint and affidavits filed by the parties, it appears to be
undisputed that there are no contractual agreements between Rolls-Royce
and Spirit, and that Spirit made no payments directly to Rolls-Royce. It is
also undisputed that the accident in question occurred in the sky, shortly
after takeoff, from Dallas/Fort Worth International Airport.

    Courts have found similar facts insufficient to exercise specific personal
jurisdiction in Florida. In Hinkle v. Continental Motors, Inc., 268 F. Supp.
3d 1312 (M.D. Fla. 2017), the court was presented with a case involving
“an aircraft purchased from a Minnesota corporation, sold by a Virginia
salesperson, delivered in Minnesota, which crashed in South Carolina.”
Id. at 1317. The plaintiff alleged that “the post-accident testing showed
the oil transducer was faulty and the engine did not produce the required
power to function properly” and “generally that Kavlico manufactured a
defective sensor in the Aircraft which contributed to the loss of engine
power; [ ] and Cirrus manufactured a defective Aircraft and misrepresented
its airworthiness.” Id. at 1318.

    The court drew on analysis from Bristol–Myers Squibb Co. v. Superior
Court of California, San Francisco County, 137 S. Ct. 1773 (2017), a recent
opinion from the Supreme Court, which “reiterated the importance of the
‘affiliation between the forum and the underlying controversy, principally,
[an] activity or an occurrence that takes place in the forum State’ in the
context of specific jurisdiction.” Hinkle, 268 F. Supp. 3d at 1322 (quoting
Bristol–Myers Squibb, 137 S. Ct. at 1780). Because the plaintiffs in Bristol-
Myers Squibb did not allege “that they obtained the product from an in-
forum source, or were injured or treated in the forum state. . . . “[T[he
Supreme Court held that the California courts lacked specific personal
jurisdiction over the defendant.” Id.

   Returning to the issue before it, the court found that “it is undisputed
that the alleged tort caused injury in South Carolina, the site of the crash,
not Florida. And the Aircraft was sold from and delivered in Minnesota.
And any alleged tortious act, based on the allegations in the Complaint
and Amended Complaint, occurred outside of Florida.” Id. at 1324.

    The plaintiffs in Hinkle, as here, relied on Wendt v. Horowitz, 822 So.
2d 1252 (Fla. 2002), to support their argument that our long-arm statute
is satisfied by the commission of a tort out of state that causes injury to a
Florida resident. Id. at 1324. The court rejected this. Id. We agree,
because Wendt is premised on an actual connection between the tortious

                                      6
act and Florida. See id. On the facts in Hinkle, which are similar to the
facts in this case, that connection did not exist. 3

   We agree with Hinkle and, here, the alleged connection to Florida may
be similarly tenuous. At a bare minimum, the two affidavits filed by Rolls-
Royce create a disputed issue as to the allegations asserted by Spirit. And,
in our state court system, those disputed issues must be resolved through
an evidentiary hearing. See, e.g., Packaging & Distribution Res., LLC v.
Duke Realty Ltd., 194 So. 3d 509, 510 (Fla. 4th DCA 2016). 4 That is what
must occur in this case to resolve the disputed factual issues, a dispute
limited to whether the court may exercise specific personal jurisdiction
over Rolls-Royce.

                                 Conclusion

    Rolls-Royce filed two affidavits that created disputed issues of fact
about whether the court could exercise specific personal jurisdiction over
it. The court was required to conduct an evidentiary hearing to resolve the
disputed issues. As a result, we reverse the court’s order and remand for
an evidentiary hearing to resolve the disputed issues. If the court
concludes Rolls-Royce did not commit a tortious act within the state of
Florida, the motion to dismiss must be granted.

    Reversed and Remanded.

TAYLOR and LEVINE, JJ., concur.

                             *         *          *

    Not final until disposition of timely filed motion for rehearing.

3A similar result was reached in Clay v. AIG Aerospace Ins. Services, Inc., 61 F.
Supp. 3d 1255 (M.D. Fla. 2014).
4 In the federal court system an evidentiary hearing to determine personal
jurisdiction is not required but held at the discretion of the court. Snow v.
DirecTV, Inc., 450 F.3d 1314, 1317 (11th Cir. 2006).

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