Court Opinion

ID: 17278
Source: CourtListenerOpinion
Date Created: 2010-04-25 07:02:49+00
Date Added: 2024-06-11T16:46:45.729771
License: Public Domain

Revised March 29, 1999

                 UNITED STATES COURT OF APPEALS
                      For the Fifth Circuit

                   ___________________________

                           No. 98-50500
                   ___________________________

                        Ana Maria Falcon,

                                                 Plaintiff-Appellee,

                             VERSUS

               Transportes Aeros de Coahuila, S.A.
           a/k/a TACSA, also known as TASKA, ET. AL.,

                                                         Defendants,

               Transportes Aeros de Coahuila, S.A.
                a/k/a TACSA, also known as TASKA,

                                              Defendant-Appellant.

       ___________________________________________________

           Appeal from the United States District Court
                 for the Western District of Texas
       ___________________________________________________
                           March 24, 1999

Before DAVIS, STEWART, and PARKER, Circuit Judges.

W. EUGENE DAVIS, Circuit Judge:

     This appeal presents us with a novel question: Whether this

Court has jurisdiction under 28 U.S.C. § 1291 and the collateral

order doctrine to review a district court’s order finding personal

jurisdiction to exist, where that order was issued simultaneously

with another order remanding the case to state court for lack of

subject matter jurisdiction. For reasons set forth below, we find

appellate jurisdiction to be lacking and dismiss the appeal.
                                        I.

     On October 31, 1995, a Cessna Caravan 208-B, designated TACSA

Flight    108,   crashed    in    Mexico         ten   miles    shy   of       its   final

destination in Piedras Negras, Mexico, a city approximately one

mile from the Texas border. The plane was owned by defendant Nozaki

and Co., Ltd. ("Nozaki"), a Japanese corporation, and was leased by

defendant Western Aircraft, Inc. ("Western Aircraft"), an Idaho

corporation. Defendant-appellant Transportes Aeros De Coahuila,

S.A. ("TACSA"), a Mexican corporation operating in Mexico as a

domestic commercial air carrier, was the operator and sublessee of

the plane. Eleven people, including the pilot, were on board at the

time of the crash. The pilot and all but two of the passengers were

killed.

     The present wrongful death action was brought in November 1996

against TACSA, Western Aircraft, Nozaki, and Nozaki America, Inc.,

an American subsidiary of Nozaki. The action was originally filed

in state court, in the 365th Judicial District of Maverick County,

Texas. The defendants removed the case to federal district court

pursuant to 28 U.S.C. § 1441, claiming federal jurisdiction under

the federal common law of international relations and treaty

interpretation. The plaintiffs filed a motion for remand, and the

defendants    filed   a    motion      to       dismiss   for   lack      of    personal

jurisdiction and for forum non conveniens.

     On December 10, 1997, the district court issued an order

("Dismissal Order") granting TACSA’s motion to dismiss for lack of

personal     jurisdiction.       The    plaintiffs        filed       a    motion     for

                                            2
reconsideration. On February 13, 1998, the district court issued a

second order ("Personal Jurisdiction Order") vacating the Dismissal

Order. The court found that personal jurisdiction existed based on

new evidence that TACSA maintained a bank account in Texas, had

correspondence concerning the bank account sent to a mailing

address within the United States, regularly repaired its aircraft

in Texas, and regularly bought supplies in Texas. The same day, the

district court issued a third order ("Remand Order") remanding the

case to state court for lack of subject matter jurisdiction. TACSA

filed a motion for reconsideration of the Personal Jurisdiction

Order, which the district court denied. This appeal followed.1

                                     II.

     TACSA   contends   that   the    Personal    Jurisdiction       Order    is

collateral to the Remand Order and is effectively unreviewable

because of the Remand Order. Therefore, TACSA argues, this Court

should   assert   jurisdiction   under     28    U.S.C.   §   1291   and     the

collateral order doctrine.

     The collateral order doctrine was recognized by the Supreme

Court in Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541,

546, 69 S. Ct. 1221, 1225-26 (1949), where the Court identified a

"small class" of interlocutory decisions that are immediately

appealable under 28 U.S.C. § 1291. To fall within the collateral

     1
      TACSA appeals only the Personal Jurisdiction Order, as the
Remand Order falls clearly outside of this Court’s appellate
jurisdiction. See Angelides v. Baylor College of Medicine, 117 F.3d
833, 835-36 (5th Cir. 1997) (holding that a remand order, even if
erroneous, is not appealable).

                                      3
order doctrine, however, an order must (among other requirements)

be "separable" from the merits of the underlying action. Id. at

546, 69 S. Ct. at 1225 (a decision is final and appealable for

purposes of § 1291 if it "finally determine[s] claims of right

separable from, and collateral to, rights asserted in the action,

too important to be denied review and too independent of the cause

itself to require that appellate consideration be deferred until

the whole case is adjudicated."). See also Coopers & Lybrand v.

Livesay, 437 U.S. 463, 468, 98 S. Ct. 2454, 2458 (1978) (noting

that an order must "resolve an important issue completely separate

from the merits of the action" to fall within the collateral order

doctrine).

     In Angelides v. Baylor College of Medicine, 117 F.3d 833 (5th

Cir. 1997), this Court explained what conditions must be satisfied

for an order to be considered "separable" in the remand context:

     An order is "separable" from an order of remand and eligible
     for appellate review if two conditions are satisfied. First,
     it must precede the order of remand "in logic and in fact," so
     as to be made while the district court had control of the
     case. City of Waco v. United States Fidelity & Guar. Co., 293
U.S. 140, 143, 55 S. Ct. 6, 7 (1934). Second, the order sought
     to be separated must be "conclusive." Id.; Linton v. Airbus
     Industrie, 30 F.3d 592, 597 (5th Cir. 1994). An order is
     "conclusive" if it will have the "preclusive effect of being
     functionally unreviewable in the state court." Linton, 30 F.3d
     at 597.

117 F.3d at 837. The principal question here is whether the

Personal     Jurisdiction   Order   was   conclusive,   and   therefore

separable, within the meaning of Angelides.

     This Court has not previously addressed the question of

whether an order finding personal jurisdiction to exist, issued

                                    4
simultaneously with an order remanding for lack of subject matter

jurisdiction, is conclusive. That is an issue of first impression.

Related Fifth Circuit precedent, however, convincingly shows that

the Personal Jurisdiction Order is not conclusive. In Angelides,

the     Court    conducted    a   "careful         reading"        of    precedent     and

ascertained that the key determinant of conclusiveness is whether

the order in question is substantive or jurisdictional. Id. The

Court noted that every case in which this Court has granted

collateral       appellate    review    following          a    remand   order    by   the

district court has involved some denial of a substantive right. Id.

("In those cases . . . the separable portion of the order denied a

substantive right not subject to review by the state court."). In

contrast, the Court observed that every case in which this Court

has denied collateral appellate review following a remand order by

the district court has involved a jurisdictional question that

"could be reconsidered by the state court." Id. Thus, the Court

concluded that the immunity and exhaustion orders before it were

not "conclusive," and therefore were not subject to collateral

order review, because "as jurisdictional decisions, they may be

reviewed in the state court." Id.

      The Personal Jurisdiction Order in this case presents an even

more obvious example of a non-conclusive jurisdictional order than

the immunity and exhaustion orders at issue in Angelides. In

finding        that   there   were     sufficient          contacts      for     personal

jurisdiction to exist, the district court denied no substantive

right     of     TACSA.   Rather,      it       made   a       simple    jurisdictional

                                            5
determination.       As    discussed           below,    the     district     court’s

determination has no preclusive effect on the state court. Because

the order is reviewable by the state court, it is not conclusive

and   therefore   may     not    be    reviewed     by   this     Court    under    the

collateral order doctrine.

      TACSA    argues     that       the   Personal      Jurisdiction       Order    is

conclusive because it may have a preclusive effect on the state

court. This argument is based on one sentence from a footnote in

this Court’s recent en banc decision in Marathon Oil Company v.

Ruhrgas, 145 F.3d 211 (5th Cir. 1998) (en banc), in which the Court

stated: "It has long been the rule that principles of res judicata

apply to jurisdictional determinations--both subject matter and

personal." 145 F.3d at 218 n. 9. That one-sentence dictum, however,

is insufficient to bring the Personal Jurisdiction Order within the

collateral order doctrine. Although the district court in Marathon

Oil Company was faced with a situation similar to the present case,

the outcome was notably different. In Marathon Oil Company, an oil

company and its affiliates sued a German gas supplier in state

court. The gas supplier removed the action and moved to dismiss for

lack of personal jurisdiction. The oil company and its affiliates

sought remand based on lack of subject matter jurisdiction. In

contrast to the present case, in Marathon Oil Company the district

court chose not to decide the motion to remand, and instead

dismissed for lack of personal jurisdiction. The court never made

any determination regarding subject matter jurisdiction, and did

not   remand   the    case      to    state     court.   Here,    the     court     made

                                           6
determinations both as to personal jurisdiction and as to subject

matter jurisdiction. It found sufficient contacts for personal

jurisdiction, and remanded for lack of subject matter jurisdiction.

This distinction is critical.

       Three requirements must be met for the federal doctrine of

collateral estoppel to apply: 1) the prior federal decision must

have resulted in a "judgment on the merits"; 2) the same fact

issues sought to be concluded must have been "actually litigated"

in the federal court; and 3) the disposition of those issues must

have   been    "necessary   to   the   outcome"    of    the   prior   federal

litigation. Parklane Hosiery Co. V. Shore, 439 U.S. 322, 326 n. 5,

99 S. Ct. 645, 649 n. 5 (1979). In Marathon Oil Company, all three

requirements were met. Here, none have been met. A finding of

sufficient contacts for personal jurisdiction, unlike a finding of

insufficient contacts, falls short of a "judgment on the merits."

When a district court dismisses for lack of personal jurisdiction,

the action ends; but when a district court declines to dismiss for

lack of personal jurisdiction, the action continues to the next

stage. Moreover, given the district court’s simultaneous order

remanding for lack of subject matter jurisdiction, the personal

jurisdiction     issue   plainly   was     not   "actually     litigated"   or

"necessary to the outcome" of the litigation. As the Court of

Appeals   of   Texas,    First   District        noted   in    Shell   Pipeline

Corporation v. Coastal States Trading, Inc., 788 S.W.2d 837, 843

(Tex. Ct. App. 1990), "[w]hen the federal court determined it did

not have subject matter jurisdiction . . ., any finding beyond

                                       7
those necessary to make that decision are not ‘actually litigated’

or   ‘necessary   to   the   outcome,’   and   therefore,   do   not   have

collateral estoppel or res judicata consequences. See Jack Faucett

Assoc., Inc. V. American Tel. & Tel. Co., 744 F.2d 118, 125 (D.C.

Cir. 1984)."

      This analysis shows that the Personal Jurisdiction Order has

no preclusive effect. Hence, it is not conclusive and falls outside

of the collateral order doctrine’s requirement of separability. The

appeal is therefore DISMISSED.

                                    8