Court Opinion

ID: 5138904
Source: CourtListenerOpinion
Date Created: 2021-12-21 15:21:47.856038+00
Date Added: 2024-06-11T11:32:43.819269
License: Public Domain

2019 UT App 109

                THE UTAH COURT OF APPEALS

                         MICHELE FELIX,
                           Appellee,
                               v.
                      NOVELIS CORPORATION,
                           Appellant.

                             Opinion
                        No. 20180216-CA
                        Filed June 20, 2019

           Third District Court, Salt Lake Department
              The Honorable Randall N. Skanchy
                          No. 150908525

         Alexander Dushku and Justin W. Starr, Attorneys
                        for Appellant
        Gilbert L. Purcell, James P. Nevin, Daniel J. Morse,
          Kimberly J. Chu, and Gary Brayton, Attorneys
                             for Appellee

      JUDGE KATE APPLEBY authored this Opinion, in which
    JUDGES MICHELE M. CHRISTIANSEN FORSTER and DAVID N.
                   MORTENSEN concurred.

APPLEBY, Judge:

¶1      This lawsuit stems from Raymond Felix’s alleged contact
with asbestos and resulting death from mesothelioma in 2014.
Michele Felix, acting as the personal representative on behalf of
Felix’s legal heirs (Estate), filed a lawsuit in 2015 against multiple
defendants who allegedly exposed Felix to asbestos. The Estate
added Novelis Corporation to the lawsuit in 2017 and Novelis
moved to dismiss for lack of personal jurisdiction. The district
court denied the motion, concluding that Novelis had sufficient
minimum contacts with Utah to support specific personal
jurisdiction. We reverse.
                    Felix v. Novelis Corporation

                         BACKGROUND

¶2     Felix died in 2014 from mesothelioma. In 2015 the Estate
sued multiple defendants who allegedly exposed him to
asbestos. The Estate filed an amended complaint in 2017, adding
Novelis as a defendant.

¶3    Novelis’s predecessor in interest, Metal Goods, allegedly
exposed Felix to asbestos in the 1950s through its artificial snow
product called “Snow Drift.” 1 Metal Goods manufactured Snow
Drift until 1954. During its operation, Metal Goods
manufactured and packaged Snow Drift in Missouri and sold it
to two national companies: Woolworth and Kresge (later re-
named Kmart).

¶4      Felix’s sibling (Sibling) stated in a declaration that the
Felix family used “multiple boxes of ‘Snow Drift’” to decorate
their Christmas trees “between the years of 1950 and 1955.”
Sibling “believe[d]” they purchased Snow Drift from a
Woolworth department store in Utah. The boxes were labeled
“Snow Drift” and contained “Christmas season themed
illustrations depicting snow, and text touting the product’s
properties and uses, including that it was asbestos.” Sibling
recalled seeing “the name of the manufacturer, ‘Metal Goods
Corporation, St. Louis’” on the side of the box.

¶5    Novelis moved to dismiss the complaint for lack of
personal jurisdiction. Novelis asserted it does not own real
property or business offices in Utah, does not have a workforce
or manufacturing operations here, or advertise its products here.

1. Alcan Aluminum Corporation subsequently purchased Metal
Goods and Novelis was created through a reorganization of
Alcan. Novelis does not dispute that it is the successor in interest
to Metal Goods. Novelis is a Texas corporation with its principal
place of business in the state of Georgia.

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                    Felix v. Novelis Corporation

Novelis asserted it possessed no information “that Metal Goods
(or Alcan) sold Snow Drift in Utah, or had offices, employees,
inventory, real estate, or facilities in Utah.” Novelis similarly
asserted that it had no information that Metal Goods sold or
advertised any products in Utah. It argued that neither “Novelis,
nor its predecessors, have any contacts with the State of Utah,”
and therefore the Estate’s claims against it should be dismissed
for lack of personal jurisdiction.

¶6     The district court denied the motion. It ruled that the
Estate failed to establish general jurisdiction 2 but concluded that
the Estate submitted sufficient evidence to support specific
jurisdiction. The court found that the evidence “support[ed] the
conclusion that the Snow Drift product was sold for several
years at Woolworth stores in Utah.” Further, “Snow Drift was
sold under the Metal Goods name, to Woolworth stores in Utah,
and Utah consumers could reasonably expect Metal Goods and
its [successor] in interest [Novelis] to stand behind its product
and be answerable for any defects.”

¶7     Novelis filed an interlocutory appeal challenging the
court’s denial of its motion to dismiss.

             ISSUE AND STANDARD OF REVIEW

¶8     The issue on appeal is whether the district court erred in
denying Novelis’s motion to dismiss for lack of personal
jurisdiction. “An appeal from a pretrial jurisdictional decision
made only on documentary evidence presents legal questions
which we review for correctness.” Mower v. Nibley, 2016 UT App
174, ¶ 12, 382 P.3d 614 (quotation simplified). “If the trial court
proceeds on documentary evidence alone to determine whether
personal jurisdiction is proper, the plaintiff is only required to

2. The Estate does not dispute general jurisdiction on appeal.

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                   Felix v. Novelis Corporation

make a prima facie showing of personal jurisdiction.” Id.
(quotation simplified).

                           ANALYSIS

¶9     Novelis argues the district court erred in denying its
motion to dismiss for lack of specific personal jurisdiction. It
asserts the court lacks specific jurisdiction over it because the
Estate demonstrated that Metal Goods merely placed its
“product into the stream of commerce” and that product
“happened to end up in Utah.”

¶10 “Specific personal jurisdiction gives a court power over a
defendant only with respect to claims arising out of the
particular activities of the defendant in the forum state.” Venuti
v. Continental Motors Inc., 2018 UT App 4, ¶ 10, 414 P.3d 943
(quotation simplified). Specific jurisdiction must satisfy Utah’s
long-arm statute, Utah Code Ann. § 78B-3-201(3) (LexisNexis
2018), as well as the Due Process Clause of the Fourteenth
Amendment. Venuti, 2018 UT App 4, ¶ 10. Because Utah’s long-
arm statute extends jurisdiction to the fullest extent allowed by
the Due Process Clause, we move directly to that analysis. Parry
v. Ernst Home Center Corp., 779 P.2d 659, 661 (Utah 1989).

¶11 The Due Process Clause requires that before a court can
exercise specific personal jurisdiction over a nonresident
defendant, the defendant have “minimum contacts” with the
forum state “such that the maintenance of the suit does not
offend traditional notions of fair play and substantial justice.”
International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)
(quotation simplified). “When a defendant purposefully avails
itself of the privilege of conducting activities within the forum
State, thus invoking the benefits and protections of its laws,
courts will generally conclude that due process is satisfied.”
Venuti, 2018 UT App 4, ¶ 12 (quotation simplified).

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                    Felix v. Novelis Corporation

¶12 The primary dispute in this appeal is whether the Estate
has satisfied the “stream of commerce” test. “The ‘stream of
commerce’ theory of specific jurisdiction developed in product-
liability cases to address the situation where the seller does not
come in direct contact with the forum state but does so through
intermediaries such as retailers or distributors.” Id. ¶ 22
(quotation simplified). To satisfy the stream of commerce test, a
plaintiff must show that the sale of the product “‘is not simply
an isolated occurrence, but arises from the efforts of the
manufacturer or distributor to serve directly or indirectly, the
market for its product in other States.’” Id. (quoting World-Wide
Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980)). “The
defendant’s transmission of goods permits the exercise of
jurisdiction only where the defendant can be said to have
targeted the forum; as a general rule, it is not enough that the
defendant might have predicted that its goods will reach the
forum State.” J. McIntyre Mach., Ltd. v. Nicastro, 564 U.S. 873, 882
(2011).

¶13 In this case, the Estate has—at most—shown that Metal
Goods sold Snow Drift to third-party distributors and the
product ended up in Utah. The district court noted during the
hearing on the motion to dismiss that “the only contact we have
is the fact that Snow Drift was purchased from a Woolworth
store here in Utah and that’s about it.” The court erroneously
concluded that this is enough to support specific jurisdiction.
“[M]erely placing a product into the stream of commerce
knowing that it could be swept into the forum state does not
subject a manufacturer to personal jurisdiction.” Venuti, 2018 UT
App 4, ¶ 27. The stream of commerce theory requires “some act
by which the defendant purposefully avails itself of the privilege
of conducting activities within the forum state, thus invoking the
benefits and protections of its laws.” Id. (emphasis added)
(quotation simplified).

¶14 Methods of showing the additional act necessary to
establish specific jurisdiction include “‘designing the product for

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                     Felix v. Novelis Corporation

the market in the forum State, advertising in the forum State,
establishing channels for providing regular advice to customers
in the forum State, or marketing the product through a
distributor who has agreed to serve as a sales agent in the forum
State.’” Parry, 779 P.2d at 663 (emphasis omitted) (quoting Asahi
v. Metal Industry Co. v. California, 480 U.S. 102, 112 (1987)).

¶15 The Estate argues it has shown the additional act
necessary to establish specific jurisdiction through “advertising
in the forum State.” Id. (quotation simplified). It contends that
Metal Goods advertised its product in Utah by placing its
company name on boxes of Snow Drift. The packaging also
“contained promotional text, on-product advertising, touting
Snow Drift’s desirable features and uses.”

¶16 Simply placing a company label on a package is an
insufficient act to subject a manufacturer to specific jurisdiction.
The additional act necessary to establish specific jurisdiction
must be targeted at the forum in some way. In Parry, our
supreme court was confronted with this same issue. 779 P.2d at
660. The plaintiff in Parry was injured in Utah while splitting
logs with a maul manufactured by one of the defendants. Id. The
defendant was a Japanese manufacturer that had no direct
contact with Utah. Id. It knew its “products would be distributed
for retail sales throughout the western United States and
possibly in any state in the United States.” Id. But there “was no
evidence proffered that [it] directly sold or advertised any of [its]
products in Utah.” Id. The supreme court concluded that
awareness of potential sales in Utah is insufficient to establish
specific jurisdiction. Id. at 667. The court rejected the argument
that selling a product in Utah constitutes an advertisement
sufficient to support specific jurisdiction. Id. at 666; see also Fenn
v. Mleads Enters., Inc., 2006 UT 8, ¶ 22, 137 P.3d 706 (recognizing
that an advertising campaign may establish sufficient minimum
contacts when the contact includes direct communications
between the parties).

20180216-CA                      6                  2019 UT App 109
                    Felix v. Novelis Corporation

¶17 Here, the labeling on the package does not demonstrate
that Metal Goods made any deliberate engagement in
“significant activities within the state.” Fenn, 2006 UT 8, ¶ 13.
While the labeling was specific to the Christmas season, it was
not specific to Utah. The Estate argues that putting the name
“Metal Goods” on the packaging showed an intent to advertise
and stand behind its product. This misses the point. Affixing a
company name to the packaging is not aimed at Utah specifically
and therefore does not exhibit purposeful availment.

¶18 We conclude the Estate failed to demonstrate that Novelis
has sufficient minimum contacts to establish specific jurisdiction
in Utah. Haling Novelis into a Utah court under these facts
offends “traditional notions of fair play and substantial justice.”
International Shoe, 326 U.S. at 316 (quotation simplified).

                         CONCLUSION

¶19 The district court erred in concluding that the Estate made
a prima facie showing that the court had specific jurisdiction
over Novelis. Because Novelis does not have sufficient minimum
contacts with Utah, we reverse.

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