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Archive for July, 2011

Viasystems, Inc. v. EMB-Papst St. Georgen GmbH & Co., KG, No. 10-2460.

Facts

Viasystems, Inc. (“Viasystems”), is a Delaware corporation based principally in Saint Louis, Missouri, that manufactures telecommunications equipment. In 2007, Viasystems contracted with Ericsson A.B. (“Ericsson”), a Swedish company, to manufacture base units that would eventually be distributed in Japan. Each unit required a cooling fan, which Viasystems purchased from EMB-Papst St. Georgen GmbH & Co. (“St. Georgen”), a German corporation. At no point did the cooling fans or base units enter the United States.

Ericsson found that some of the cooling fans were malfunctioning and informed Viasystems. Viasystems traced the issue to a manufacturing defect. Ericsson paid over $5 million to replace the defective cooling fans and demanded reimbursement from Viasystems. Viasystems partially reimbursed Ericsson and made a demand upon St. Georgen to assume responsibility for the replacement costs. St. Georgen made a partial payment of almost $1.5 million to Viasystems and then refused to pay anything further.

Viasystems filed suit in federal court against St. Georgen, claiming diversity jurisdiction and asserting various contract and tort claims. St. Georgen filed a motion to dismiss based on lack of personal jurisdiction. The trial court granted the motion, and Viasystem appealed.

Decision

The Eighth Circuit Court of Appeals explained that personal jurisdiction over a defendant can be general or specific:

‘Specific jurisdiction refers to jurisdiction over causes of action arising from or related to a defendant’s actions within the forum state,’ while ‘[g]eneral jurisdiction . . . refers to the power of a state to adjudicate any cause of action involving a particular defendant, regardless of where the cause of action arose.’

Although Viasystems alleged both specific and general jurisdiction over St. Georgen, the court noted that the due-process threshold was not satisfied for either. As the Supreme Court of the United States has long held, a defendant must have had sufficient minimum contacts with the forum state so that the defendant should reasonably anticipate being taken to court in that state. The court found that St. Georgen’s calls, e-mails, and a money transfer to Missouri could not provide the substantial connection needed to confer jurisdiction.

Accordingly, the court upheld the trial court’s dismissal.

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