In 2011 in J. McIntyre Machinery v. Nicastro, the Supreme Court revisited the issue of specific personal jurisdiction over a manufacturer based on putting a product into the “stream of commerce.”  131 S. Ct. 2780 (2011).  While the fractured Court did not produce a majority opinion, the plurality and a 2-Justice concurrence expressed concern about a view of that doctrine that would allow jurisdiction in a particular state based on a manufacturer’s general intent to do business across the country.  The Fifth Circuit directly addressed that language in Ainsworth v. Moffett Engineering, No. 12-60155 (May 9, 2013), finding that the plurality was not controlling, and that the 2-Justice concurrence was decided on the limited ground that no formulation of the doctrine would allow jurisdiction based on that manufacturer’s small number of shipments into the forum.  Because the defendant in Ainsworth had over 100 shipments during the relevant time, jurisdiction was appropriate. Language from past Circuit cases that may be inconsistent with McIntyre was noted but kept in place for now.

While of limited precedential value because it uses “plain error” review, Ward v. Rhode touches on the role of websites in personal jurisdiction.  No. 12-41201 (May 3, 2013, unpublished).  Plaintiff alleged that the defendants placed a false “Scam Alert” about Plaintiff’s debt settlement services on a website.  The court observed: “The [Defendants’] website is interactive to the extent that it allows users to post their opinions about the debt-counseling services that they have used.  However, it neither allows users to purchase products online, nor sells subscriptions to view its content.  Therefore, the nature of the exchange of information is not commercial.”  (citing Mink v. AAAA Dev. LLC, 190 F.3d 333, 336 (5th Cir. 1999)).  Accordingly, it was “not clear or obvious” that the website’s interactivity with Texans and the commercial nature of that interaction was sufficient to establish jurisdiction.

Plaintiff purchased a shaved-ice machine in Louisiana, made by Southern Snow, a Louisiana-based business.  She moved the machine to Mississippi, injured her hand while cleaning it, and sued for damages in Mississippi.  Irvin v. Southern Snow Manufacturing, No. 11-60767 (March 13, 2013, unpublished).  The Fifth Circuit agreed with the district court that she did not establish specific jurisdiction under a stream-of-commerce theory.  Even assuming that Southern Snow had minimum contacts by making a substantial percentage of its sales into neighboring Mississippi, her claim did not arise out of those contacts because “Southern Snow sold the machine to a Louisiana customer and had no knowledge that, years later, Irvin unilaterally transported it into Mississippi.”  General personal jurisdiction was not at issue.  The Court’s emphasis on the “arising out of” factor echoes its recent opinion in ITL International v. Constenla, S.A., 669 F.3d 493 (5th Cir. 2012).  The vagaries of snow cone sales produced another published Fifth Circuit opinion, on procedural due process and pleading issues, in Bowlby v. City of Aberdeen, 681 F.3d 215 (5th Cir. 2012).

The defendant in Innovation First Int’l v. Zuru Inc. removed a trade secret case about a toy robotic fish and then obtained dismissal on forum non conveniens grounds.  No. 12-10511 (Feb. 19, 2013, unpublished).  The Fifth Circuit found no abuse of discretion in the district court’s conclusions that the design and production of the fish took place in China and that the bulk of witnesses and evidence were in China, and affirmed based on the analogous case of Dickson Marine v. Panalpina, Inc., 179 F.3d 331 (5th Cir. 1999).  A revised opinion slightly changed the Court’s analysis of the deference due to the plaintiff’s choice of forum.

The judgment debtors in Seven Arts Pictures v. Jonesfilm were found in civil contempt for failure to answer postjudgment discovery and other issues about enforcement of a judgment.  No. 11-31124 (Feb. 18, 2013, unpublished).  The Fifth Circuit affirmed, finding that the district court had general personal jurisdiction over the debtors, that the debtors had waived arguments about the orders by not timely and properly objecting below, and that the district court did not abuse its discretion in awarding $21 thousand in attorneys fees.  While the holdings on jurisdiction, waiver, and attorneys fees draw heavily from the specific facts of the case, the legal framework used is of broad applicability.  Footnote 7 acknowledges the unusual procedural posture of the jurisdiction issue, which had not been raised until after the notice of appeal was filed.

Denied enforcement of a $26 million arbitration award in China’s Fujian Province (that court finding the award invalid because an arbitrator was imprisoned during the proceedings), the plaintiff sought recognition in the Eastern District of Louisiana.  First Investment Corp. of the Marshall Islands v. Fujian Mawei Shipbuilding,  No. 12-30377 (Dec. 21, 2012, revised Jan. 17, 2013). The Fifth Circuit affirmed dismissal for lack of personal jurisdiction with three holdings: (1) the recent case of Goodyear Dunlop Tires v. Brown, 131 S. Ct. 2846 (2011), removed doubt as to whether foreign corporations could invoke due process protection about jurisdiction; (2) the New York Convention did not abrogate those rights; and (3) no “alter ego” relationship among the relevant companies was shown that could give rise to jurisdiction.  In a companion case, the Court affirmed a ruling that denied jurisdictional discovery based on “sparse allegations” of alter ego.    Covington Marine v. Xiamen Shipbuilding, No. 12-30383 (Dec. 21, 2012); cf.Blake Box v. Dallas Mexican Consulate, No. 11-10126 (Aug. 21, 2012) (reversing jurisdictional discovery ruling).

In National Union v. American Eurocopter, a contribution suit arising from settlement of claims about a helicopter crash, a Hawaii district court found no personal jurisdiction and transferred venue to Texas.  No. 11-10798 (Aug. 27, 2012).  The appellant challenged that ruling, and the Fifth Circuit held that it lacked jurisdiction over that issue.  Id at 4 (quoting 28 U.S.C. § 1294, defining appellate jurisdiction as reaching “appeals . . . [f]rom a district court of the United States to the court of appeals for the circuit embracing the district”).  On the merits, the Court affirmed a dispositive choice-of-law ruling for Texas law, noting a Texas choice-of-law provision in a relevant contract, a rough balance between the place of the accident (Hawaii) and the defendants’ headquarters (Texas), and the relatively weak interest of an out-of-state insurer.  Id. at 5-7 (noting Beech Aircraft v. Jinkins,  739 S.W.2d 19 (Tex. 1987)).

Vanderbilt Mortgage v. Flores, arising from a collection suit about the financing for a mobile home, involved a substantial recovery on counterclaims for wrongful debt collection and filing of a fraudulent lien.  692 F.3d 357 (5th Cir. 2012).  The Fifth Circuit affirmed in part and reversed in part, finding: (1) the release of the debtors unambiguously reached only the lien and not the underlying debt (thereby mooting some counterclaims); (2) property owners in the position of these debtors did not have an ongoing duty, for limitations purposes, to check deed records; (3) Tex. Civ. Prac. & Rem Code chapter 12, about fraudulent liens, does not require actual damages before penalties may be awarded; (4) Chapter 12 does not violate the Excessive Fines Clause; and (5) personal jurisdiction over one defendant was appropriate, particularly given the confusion in its own records about its activities.

An Austin-based software developer sued a German software company for breach of contract and related torts.  Pervasive Software v. Lexware GMBH & Co., No. 11-50097 (July 20, 2012).  The Fifth Circuit affirmed the dismissal of the case for lack of personal jurisdiction, revisiting several key jurisdiction points for business relationships.  The Court held that the parties’ contracts alone would not create jurisdiction when the parties had no prior negotiations and did not envision “continuing and wide-reaching contacts” in Texas.  Id. at 15, 19 (citing Burger King v. Rudzewicz, 471 U.S. 462 (1985).  (A lengthy footnote analyzes Texas law about the role of choice-of-law clauses in a jurisdictional analysis.  Id.  at 14-15 n.4.)  The German company’s Internet sales into Texas — 15 programs, costing roughly $66 each, over four years — did not establish “purposeful availment” for specific jurisdiction, or “continuous and systematic contacts” for general jurisdiction.  Id. at 19-24, 28-29.    The alleged acts of conversion occurred in Germany and thus did not create specific jurisdiction either.  Id. at 25-26.

The Court briefly revisited personal jurisdiction in an unpublished opinion, ITL International v. Cafe Soluble, S.A., No. 11-60360 (rev’d June 7, 2012).  The case arose from a dispute between Mars, Inc. and a Latin American distributor, closely related to the dispute at issue in the recent case of ITL International v. Costenla, S.A.  The Court followed the same analytical framework, finding that the defendant’s contacts with Mississippi were not sufficiently related to the dispute to create jurisdiction.  It concluded by reminding that a dismissal for lack of personal jurisdiction should be without prejudice because it is not on the merits.

The Supreme Court wrote two major personal jurisdiction opinions in 2011: Goodyear Dunlop Tires v. Brown, 131 S. Ct. 2846, about general personal jurisdiction based on product sales into a state, and J. McIntyre Machinery v. Nicastro, 131 S. Ct. 2780, analyzing specific personal jurisdiction based on a “stream of commerce” theory.  In ITL International v. Constenla, S.A., the Fifth Circuit’s first lengthy personal jurisdiction opinion since then, the Court found that a defendant’s acceptance of 55 shipments of goods in Mississippi was “purposeful contact[],” but went on to find no specific jurisdiction because the parties’ trademark dispute had too weak a link to those contacts.  No. 10-60892 at 11 (Jan. 31, 2012) The Court did not address general jurisdiction and thus did not directly engage the Goodyear case.