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Simpson v. Champion Petfoods USA Inc.

United States District Court, E.D. Kentucky, Northern Division, Covington

October 31, 2019

TRACY SIMPSON, et al. PLAINTIFFS
v.
CHAMPION PETFOODS USA, INC., et al. DEFENDANTS

          MEMORANDUM OPINION AND ORDER

          DAVID L. BANNING, UNITED STATES DISTRICT JUDGE

         This matter is before the Court on two issues-a potential venue transfer and a request for certification of interlocutory appeal. In the Court's previous Memorandum Opinion and Order, the Court dismissed all of the Kentucky putative class members' claims (leaving only the Virginia putative class members' claims viable) and notified the parties that it was considering a transfer of this action to the Eastern District of Virginia, Norfolk Division. (Doc. # 37). The Court accordingly ordered that the parties file simultaneous briefs addressing whether such a transfer would be appropriate under 28 U.S.C. § 1404(a). Id. at 39-40. Both parties have briefed the issue. (Docs. # 39 and 40). Therefore, this matter is now ripe. Also pending before the Court is Plaintiff Tracy Simpson's Motion for Certification of Interlocutory Appeal and to Stay Proceedings Pending Appeal. (Doc. # 41). That Motion having been fully briefed, (Docs. # 44 and 45), it is also now ripe for review.[1]

         I. TRANSFER OF VENUE

         Plaintiff Danika Lolles, a Virginia resident, and Defendants all argue that the Court should retain jurisdiction based on the various factors to be weighed in ruling on a motion to transfer under § 1404(a).[2] See (Docs. # 39 and 40). The Court concludes that a venue transfer to the proposed forum is foreclosed by a threshold requirement, only briefly mentioned by Lolles: the absence of personal jurisdiction over the Defendants in Virginia. (Doc. # 40 at 2).

         The applicable federal statute states:

For the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought or to any district or division to which all parties have consented.

28 U.S.C. § 1404(a) (emphasis added). The phrase “might have been brought” in § 1404(a) is a threshold requirement that unambiguously limits where a federal court may transfer an action. See Hoffman v. Blaski, 363 U.S. 335, 343-344 (1960). That is, a transfer without consent of the parties is permissible only if, at the time the action was originally filed, the proposed transferee district was a forum available to the plaintiff where venue, subject-matter jurisdiction, and personal jurisdiction all would have been proper. See id.; Bunting v. Gray, 2 Fed.Appx. 443, 448 (6th Cir. 2001); see also 15 Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 3845 (4th ed. 2019). At the time this suit was filed here, however, a court in the Eastern District of Virginia could not have asserted personal jurisdiction over the Defendants, and therefore transfer under § 1404(a) would be inappropriate.

         Federal courts exercise personal jurisdiction coextensively with the courts of the forum state. Fed.R.Civ.P. 4(k)(1)(A). Virginia's long-arm statute permits its courts to assert personal jurisdiction “to the extent permissible under the due process clause of the federal Constitution.” Brown v. Am. Broad. Co., 704 F.2d 1296, 1301 (4th Cir. 1983) (citing Kolbe, Inc. v. Chromodern Chair Co., 180 S.E.2d 664, 667 (Va. 1971)).

         Cases interpreting the Due Process Clause recognize “two types of personal jurisdiction: ‘general' (sometimes called ‘all-purpose') jurisdiction and ‘specific' (sometimes called ‘case-linked') jurisdiction.” Bristol-Myers Squibb Co. v. Superior Court, 137 S.Ct. 1773, 1780 (2017) (citing Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011)). General jurisdiction is found where a defendant's affiliations with the forum state “are so continuous and systematic as to render them essentially at home in the forum State” and will justify asserting jurisdiction “over claims unrelated to” those affiliations. Goodyear, 564 U.S. at 919, 925 (citations and internal quotation marks omitted). Specific jurisdiction, however, is warranted even where there is only a “single” or “occasional” act of the defendant in the forum state, Daimler AG v. Bauman, 571 U.S. 117, 127 (2014), but “the suit [must] aris[e] out of or relat[e] to the defendant's contacts with the forum, ” Bristol-Myers, 137 S.Ct. at 1780 (citation and internal quotation marks omitted).

         Here, at the time suit was filed, the Eastern District of Virginia could not have asserted general jurisdiction over Defendants because they could not be considered “at home” in Virginia. A “corporation is fairly regarded as at home” in the “place of incorporation and [its] principal place of business.” Daimler, 571 U.S. at 137 (citations and internal quotations omitted). The same locations appear to be considered when determining where a limited partnership is “essentially at home.” See Reitman v. Champion Petfoods USA, Inc., No. CV 18-1736-DOC (JPRx), 2018 WL 4945645, at *4 (C.D. Cal. Oct. 10, 2018) (quoting Daimler, 571 U.S. at 127). Defendant Champion Petfoods LP is a Canadian partnership with its principal place of business in Edmonton, Alberta, Canada. (Doc. # 29 ¶ 9); see also (Doc. # 39 at 3). That partnership owns Defendant Champion Petfoods USA, Inc., which is incorporated in Delaware and has its principal place of business in Auburn, Kentucky. (Doc. # 29 ¶¶ 8-9); see also (Doc. # 39 at 2-3). Although the Supreme Court has not held that “a corporation may be subject to general jurisdiction only in a forum where it is incorporated or has its principal place of business, ” the Court has also made it clear that an out-of-state defendant is not amenable to a court's general jurisdiction simply because the defendant's “sales are sizable” in the forum state. Daimler, 571 U.S. at 138-39. Thus, even though Defendants sell their products in Virginia, (Doc. # 29 ¶¶ 1, 10-11), they are not at home in Virginia and general jurisdiction cannot lie there.

         Nor could a federal court in Virginia assert specific jurisdiction over Defendants. Specific jurisdiction is only found where, as to a non-resident defendant, there exists:

(1) purposeful availment “of the privilege of acting in the forum state or causing a consequence in the forum state, ” (2) a “cause of action . . . aris[ing] from activities” in the state, and (3) a “substantial enough connection with the forum state to make the exercise of jurisdiction over the defendant reasonable.”

Schneider v. Hardesty, 669 F.3d 693, 701 (6th Cir. 2012) (quoting S. Mach. Co. v. Mohasco Indus., Inc., 401 F.2d 374, 381 (6th Cir. 1968)).[3] Here, the first element is missing, namely, “some act by which the defendant purposefully avail[ed] itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.” Goodyear, 564 U.S. at 924 (quoting Hanson v. Denckla, 357 U.S. 235, 253 (1958)). This requirement “ensures that a defendant will not be haled into a jurisdiction solely as a result of random, fortuitous, or attenuated contacts, or of the unilateral activity of another party or a third person.” Schneider, 669 F.3d at 701 (citations and internal quotation marks omitted). The only apparent contact Defendants have with Virginia is the mere fact that Defendants' dog food products are sold in various third-party retail stores. (Doc. # 29 ¶¶ 1, 10-11). This tenuous affiliation does not constitute “purposeful availment” in this Circuit.

         The Sixth Circuit has stated a preference for the “stream of commerce ‘plus' approach” to purposeful availament set forth by Justice O'Connor in Asahi Metal Industry Company. Bridgeport Music, Inc. v. Still N the Water Publ'g, 327 F.3d 472, 479-80 (6th Cir. 2003) (discussing Asahi Metal Industry Co. v. Superior Court of Cal., Solano Cty., 480 U.S. 102, 112 (1987) (plurality opinion)).[4] Under that standard, “[t]he placement of a product into the stream of commerce, without more, is not an act of the defendant purposefully directed toward the forum State.” Id. (emphasis added) (quoting Asahi, 480 U.S. at 112); see also J. McIntyre Mach., Ltd. v. Nicastro, 564 U.S. 873, 882 (2011) (plurality opinion) (“The defendant's transmission of goods [to the forum State] ...


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