Rothrock v. Captial Logistics
United States District Court for the Western District of Missouri, Southern Division
September 15, 2020, Decided; September 15, 2020, Filed
Case No. 6:20-cv-03225-MDH

Reporter
2020 U.S. Dist. LEXIS 168178 *

LINDSEY ROTHROCK, individually, and as Next Friend of GRACE ROTHROCK AND JOLEE ROTHROCK, Plaintiff, v. CAPTIAL LOGISTICS, LLC, and ALLIED WORLD ASSURANCE CO., Defendants.

ORDER
Before the Court is Plaintiff’s Motion to Remand. (Doc. 11). For the reasons discussed below, the Motion is GRANTED. The case is remanded to the Circuit Court of Greene County, Missouri. The Clerk of the Court is directed to mail a certified copy of this Order to the Clerk of the Circuit Court of Greene County, Missouri, as required by 28 U.S.C. § 1447(c).

BACKGROUND
This case arises out of the death of Scott Rothrock, who was killed in a crash involving a tractor trailer. Plaintiff seeks recovery for the wrongful death from Defendant Capital Logistics, LLC (“Capital Logistics”). Plaintiff originally sued Capital Logistics (the load broker), as well as Scott [*2] Hines (the driver) and On Track Transport (the trucking company). The claims against Hines and On Track Transport have been resolved.
This is the second attempted removal of this case. In the initial state court case, Capital Logistics did not remove the case before the 30-day time limit for it to remove had passed. Later, the Cincinnati Insurance Company (“Cincinnati Insurance”) intervened pursuant to Mo. Rev. Stat. § 537.065. Cincinnati Insurance provides the first layer of coverage to Capital Logistics. Capital Logistics and Cincinnati Insurance jointly removed the case to federal court pursuant to complete diversity jurisdiction under 28 U.S.C. §§ 1332, 1441, and 1446. Cincinnati Insurance contended that it was able to remove the case within 30 days from its own intervention, essentially restarting the time limit as its new status as a defendant in the case.
The Western District, the Honorable Judge Bough presiding, considered whether an intervening insurer for the only true defendant (Capital Logistics) can remove a case to federal court. Rothrock v. Capital Logistics, LLC, Case No. 6:20-cv-03113-SRB (W.D. Mo. Aug. 19, 2020). The Court ruled that an insurer who intervenes, as Cincinnati Insurance did, is not a “defendant” as that [*3] term is used in the removal statutes, and thus the removal by Cincinnati Insurance was wrongful and required remand. Id. at 10.
Here, Defendant Allied World Assurance Company (“Allied World”) also intervened in the state court case pursuant Mo. Rev. Stat. § 537.065. Allied World then removed this case pursuant to diversity jurisdiction under 28 U.S.C. § 1446. Allied World is an excess insurer of Capital Logistics. Allied World likewise argues that it is a proper party to remove as an intervening insurer, pursuant to its intervention in state court under Mo. Rev. Stat. § 537.065.

STANDARD
Defendants may remove to federal court “any civil action brought in a State court of which the district courts of the United States have original jurisdiction[.]” 28 U.S.C. § 1441(a). A plaintiff may challenge removal by filing a motion to remand. See 28 U.S.C. § 1447(c). The party seeking removal bears the burden of establishing subject-matter jurisdiction. In re Bus. Men’s Assurance Co. of Am., 992 F.2d 181, 183 (8th Cir. 1993). Under 28 U.S.C. § 1332(a)(1), “district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interest and costs, and is between—(1) citizens of different states[.]” “The notice of removal of a civil action or proceeding shall be filed within 30 days after the receipt by the defendant.” 28 U.S.C. § 1446(b) [*4] . “[A] district court is required to resolve all doubts about federal jurisdiction in favor of remand.” Transit Cas. Co. v. Certain Underwriters at Lloyd’s of London, 119 F.3d 619, 625 (8th Cir. 1997) (citation omitted). This Court must resolve jurisdictional issues prior to resolving any other pending motions. See Steel Co. v. Citizens for Better Env’t, 523 U.S. 83, 94-95, 118 S. Ct. 1003, 140 L. Ed. 2d 210 (1998) (noting “the requirement that jurisdiction be established as a threshold matter”). Thus, Allied World’s Motion to Dismiss (Doc. 10) is secondary to the initial determination of jurisdiction.

DISCUSSION
Plaintiff argues that the removal at hand mirrors exactly the previous attempted removal by Cincinnati Insurance, and this Court has already ruled that removal by an insurer who intervenes in a state court proceeding under Mo. Rev. Stat. § 537.065 is not a proper party to remove. Allied World does not appear to argue that it or its removal here is distinguishable at all from that of Cincinnati Insurance’s removal, but rather seems to argue that the Court’s previous ruling was incorrect. The Court finds that the previous ruling barring removal in this case does indeed directly apply to Allied World’s removal, and thus the removal is not proper. The analysis the governed the previous Court’s ruling is reiterated herein.
Given Capital Logistics’ admission that its own removal is untimely, removal in this case is procedurally defective unless Allied World is deemed a true “defendant” with the ability to remove [*5] the case within 30 days of the state court’s grant of its motion to intervene. See Arrow Fin. Servs., LLC v. Williams, No. 10-3416-cv-s-SW, 2011 WL 9158435, at *2 (W.D. Mo. Jan. 20, 2011). Plaintiff argues that Allied World is not a true defendant under federal law and is thus unable to stand in the place of its insured Capital Logistics for removal. Allied World makes the same argument made by Cincinnati Insurance in the previous removal attempt—namely that since Allied World was allowed to intervene in the state court proceeding under Mo. Rev. Stat. § 537.065, it is a full-fledged party capable of independently establishing federal jurisdiction and removing the case to federal court.
In 2017, the Missouri legislature amended § 537.065 and added the following paragraph:
2. Before a judgment may be entered against any tortfeasor after such tortfeasor has entered into a contract under this section, the insurer or insurers shall be provided with written notice of the execution of the contract and shall have thirty days after receipt of such notice to intervene as a matter of right in any pending lawsuit involving the claim for damages.
See H.B. 339 & 714, 99th Leg., Reg. Sess. (Mo. 2017). The Court’s previous decision on Cincinnati Insurance’s attempted removal correctly [*6] found that the intervening insurer does not gain additional rights beyond those specified in § 565.065. Rothrock, Case. No. 6:20-cv-03113-SRB, at 6 (citing Aguilar v. GEICO Casualty Co., 588 S.W.3d 195, 199 (Mo. App. W.D. 2019); Britt v. Otto, 577 S.W.3d 133 (Mo. App. W.D. 2019)). The Missouri Court of Appeals decision in Aguilar, as cited by this Court in the previous decision, provides a helpful summary of an insurance company’s rights after intervention:
The company claims that Allen v. Bryers, 512 S.W.3d 17 (Mo. banc 2016), as modified (Apr. 4, 2017), cert. denied, Atain Specialty Ins. Co. v. Bryers, — U.S. —-, 138 S. Ct. 212, 199 L.Ed.2d 118 (2017), and the 2017 amendment of section 537.065 give insurers an unconditional right to intervene in an underlying lawsuit and, in fact, abrogated settled law that an insurer’s potential indemnification of a judgment does not satisfy the direct-interest requirement to intervene as a matter of right. This claim was raised, and this Court rejected it, in Britt:
American Family argues that by recognizing a right to appeal the denial of the motion to intervene, the Supreme Court [in Allen] necessarily implied that the appeal would have had merit, and thus implicitly overruled the settled principle that an insurer’s interest in an action between its insured and a third party is not sufficiently direct to satisfy the first requirement for intervention set forth in Rule 52.12(a)(2). This is a [*7] strained and unsupportable interpretation of Allen. Allen did not need to address the merit of the insurer’s argument that it was entitled to intervene in the underlying tort action because the insurer waived its right to challenge the denial of its motion to intervene. Allen cannot be read to have overruled, sub silentio, the settled principle that an insurer’s interest in an action between its insured and an injured third party is not sufficient to support intervention as a matter of right pursuant to Rule 52.12(a)(2).
Britt, 577 S.W.3d at 143. GEICO’s motions to intervene in the action between Mr. Aguilar and Ms. Hollandsworth to confirm the arbitration award, filed more than thirty days after it received notice of their section 537.065 contract, were untimely. Nor did it have a direct interest in that action to support intervention as of right under Rule 52.12(a)(2). We find it unnecessary to address the second and third parts of this point, given GEICO’s lack of a direct interest in the confirmation proceeding. See BMO Harris Bank v. Hawes Trust Invs., LLC, 492 S.W.3d 607, 618 (Mo. App. W.D. 2016) (stating that a motion to intervene as a matter of right “may be denied if any one of the requirements is not met.” (citation omitted)). Nevertheless, to the extent that GEICO suggests that it would have had the right to litigate coverage [*8] issues in the confirmation proceeding, we agree with Mr. Aguilar that the appropriate forum for that dispute at this point is the pending garnishment action. See Augspurger v. MFA Oil Co., 940 S.W.2d 934, 937 (Mo. App. W.D. 1997) (“It is when a claim for potential indemnity becomes a demand for actual indemnity that the insurer acquires the requisite interest to intervene as of right.”). To the extent that GEICO claims it should have been able to litigate “any of the purported findings of fact and conclusions of law in the Arbitration Award absent the Trial Court’s Judgment and denial of the Motions to Intervene being vacated and GEICO being permitted to intervene to challenge the Arbitration Award,” we would note that it had every opportunity to enter a defense of Ms. Hollandsworth without reservation and thus to litigate such matters, but chose not to do so. This point is denied.
Aguilar, 588 S.W.3d at 200-01 (emphasis added). Thus, as this Court has already concluded, an intervening insurer’s (here, Allied World) contention that it became a proper defendant for purposes of removal by intervening pursuant to § 537.065 is not supported by Missouri caselaw.
This Court additionally concluded previously that such an intervening insurer is a nominal party, or, a defendant “against whom no [*9] real relief is sought.” Rothrock, Case. No. 6:20-cv-03113-SRB, at 7-10. See Thorn v. Amalgamated Transit Union, 305 F.3d 826, 833 (8th Cir. 2002). Accordingly, an insurer of this nature is without standing to remove the case to federal court. Rothrock, Case. No. 6:20-cv-03113-SRB, at 9. Importantly, a party who has not been sued by the original plaintiff is not considered to be a proper “defendant” under federal law. See First National Bank of Pulaski v. Curry, 301 F.3d 456 (6th Cir. 2002); Arrow Fin. Serv., 2011 WL 9158535. Thus, a party is not a “defendant” under 28 U.S.C. § 1441(a) for removal purposes unless they have had a claim brought against them by the original plaintiffs. First National Bank of Pulaski, 301 F.3d at 462-63. It is uncontested that Plaintiff did not bring any claims against Allied World. As this Court previously found, an insurer (here, Allied World) is merely indemnifying and defending Capital Logistics and is thus a nominal party not entitled to remove. Rothrock, Case No. 6:20-cv-03113-SRB, at 10 (citing Midwestern Indem. Co. v. Brooks, 779 F.3d 540, 544 (8th Cir. 2015).
Given that Allied World does not suggest that it, as a party, is materially different from Cincinnati Insurance, the Court’s previous ruling squarely provides that Allied World’s presence in the case may be ignored for purposes of removal. Given Capital Logistics’ concession that its removal would be untimely, removal is improper here. See 28 U.S.C. § 1446(b); Williams v. Safeco Ins. Co. of Am., 74 F.Supp.2d 925, 928 (W.D. Mo. 1999) (“Any technical defect in the removal procedure requires a remand unless the plaintiff [*10] fails to move for a remand within thirty days of removal.”).

CONCLUSION
For the reasons set forth herein, the Court GRANTS Plaintiff’s Motion for Remand (Doc. 11). The case is remanded to the Circuit Curt of Greene County, Missouri. The Clerk of the Court is directed to mail a certified copy of the Order to the Clerk of the Circuit Court of Greene County, Missouri, as required by 28 U.S.C. § 1447(c). Defendant Allied World Assurance Company’s Motion to Dismiss (Doc. 10) is thus denied without prejudice.
IT IS SO ORDERED.
Dated: September 15, 2020
/s/ Douglas Harpool
DOUGLAS HARPOOL
United States District Judge

Nat’l Cas. Co. v. KT2 LLC
United States District Court for the Northern District of Texas, Dallas Division
September 16, 2020, Decided; September 16, 2020, Filed
CIVIL ACTION NO. 3:19-cv-1926-E

Reporter
2020 U.S. Dist. LEXIS 169223 *

NATIONAL CASUALTY COMPANY, Plaintiff, v. KT2 LLC D/B/A CHEETAH 1 EXPRESS, JONATHON HAROLD SWANSON, AND MARK DEMOND BROWN, Defendants.

MEMORANDUM OPINION AND ORDER
Before the Court is Defendant KT2 LLC’s Motion to Dismiss for Lack of Jurisdiction under Federal Rule of Civil Procedure 12(b)(2) (Doc. No. 17). After careful consideration, for reasons that follow, the Court grants the motion.

Background
This declaratory judgment action arises from a motor vehicle accident that occurred in Illinois in November of 2018. As alleged in Plaintiff National Casualty Company’s live pleading, Defendant Mark Demond Brown was injured while “riding as a co-driver” in a semi-trailer owned by Defendant KT2 LLC, which does business as Cheetah 1 Express (“Cheetah”). At the time, [*2] Defendant Jonathon Harold Swanson was driving the semi-trailer. Both Swanson and Brown were employed by Cheetah as drivers. Swanson was acting in the course and scope of his employment when the accident occurred. In an underlying lawsuit in Harris County, Texas, Brown sued Cheetah and Swanson, alleging they are liable for the injuries he sustained in the accident.
Plaintiff is an insurance company organized under the laws of Ohio with its headquarters in Arizona. It issued a Commercial Auto Policy to Cheetah, which was in effect at the time of the accident. Plaintiff is providing Cheetah and Swanson with a defense in the underlying lawsuit under a reservation of rights. In this case, Plaintiff seeks a declaratory judgment that: 1) it has no duty to defend Cheetah and Swanson under the policy; 2) it has no duty to indemnify Cheetah, Swanson, or Brown for claims arising from the accident based on various policy exclusions; and 3) it has no obligations related to the accident under the Form MCS-90 Endorsement in the policy.
Plaintiff alleges in its complaint that Brown and Swanson are Texas citizens. In addition, Plaintiff alleges Cheetah is a limited liability company organized under Michigan [*3] law with its principal office in Michigan. Plaintiff asserts Cheetah has one member, Abbey Kizy who is a Michigan citizen. According to the complaint, Cheetah has established minimum contacts with Texas by sending and shipping goods into this State, thereby purposefully availing itself of the privilege of conducting business here. Plaintiff alleges that its claims arise from Cheetah’s contacts with Texas because Brown was injured during Cheetah’s shipment of goods to Texas, namely to Texas Wholesale Venture in Fort Worth. In addition, Plaintiff asserts that Cheetah is also subject to personal jurisdiction because its claims involve the negligent hiring and supervision of a Texas resident, Swanson.
Cheetah moves to dismiss Plaintiff’s claims against it for lack of personal jurisdiction. It argues that this Court does not have either general or specific jurisdiction over it. As an alternative to dismissal, Cheetah requests that the Court transfer the case to the United States Court for the Eastern District of Michigan.

Applicable Law
When a nonresident defendant presents a motion to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of establishing the district court’s [*4] personal jurisdiction over the defendant, though it need only make a prima facie case at the Rule 12(b)(2) stage. In re DePuy Orthopaedics, Inc., 888 F.3d 753, 778 (5th Cir. 2018). The Court accepts the plaintiff’s uncontroverted, nonconclusory factual allegations as true and resolves all controverted allegations in the plaintiff’s favor. Carmona v. Leo Ship Mgmt., Inc., 924 F.3d 190, 193 (5th Cir. 2019). The Court may determine the jurisdictional issue by receiving affidavits, interrogatories, depositions, and other recognized methods of discovery. Stuart v. Spademan, 772 F.2d 1185, 1192 (5th Cir. 1985).
A federal court sitting in diversity in Texas may exercise personal jurisdiction over a foreign defendant if permitted by (1) the Texas long-arm statute, and (2) the due process clause of the Fourteenth Amendment. Diece-Lisa Indus., Inc. v. Disney Enters., Inc., 943 F.3d 239, 249 (5th Cir. 2019). Because the Texas long-arm statute extends to the limits of federal due process, the two-step inquiry collapses into one federal due process analysis. Id. Federal due process is satisfied if two requirements are met: (1) the nonresident purposely availed himself of the benefits and protections of the forum state by establishing “minimum contacts” with the state; and (2) the exercise of jurisdiction does not offend “traditional notions of fair play and substantial justice.” Id. at 249-50. The “purposeful availment requirement ensures that a defendant will not be haled into a jurisdiction solely as a result of random, fortuitous, [*5] or attenuated contacts, or of the unilateral activity of another party or a third person.” Id. at 250 (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S. Ct. 2174, 85 L. Ed. 2d 528 (1985)). A defendant’s “minimum contacts” may give rise to either general or specific jurisdiction. Id.
Supreme Court decisions have recognized 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 of Ca., 137 S. Ct. 1773, 1779-80, 198 L. Ed. 2d 395 (2017). “For an individual, the paradigm forum for the exercise of general jurisdiction is the individual’s domicile; for a corporation, it is an equivalent place, one in which the corporation is fairly regarded as at home.” Id. at 1780 (quoting Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 924, 131 S. Ct. 2846, 180 L. Ed. 2d 796 (2011)). A court with general jurisdiction may hear any claim against that defendant, even if all the incidents underlying the claim occurred in a different State. Id. at 1780. But “only a limited set of affiliations with a forum will render a defendant amenable to” general jurisdiction in that State. Id. (quoting Daimler AG v. Bauman, 571 U.S. 117, 137, 134 S. Ct. 746, 187 L. Ed. 2d 624 (2014)). General jurisdiction exists when a nonresident defendant’s contacts with the forum state are continuous and systematic. Sangha v. Navig8 ShipManagement Private, Ltd., 882 F.3d 96, 101 (5th Cir. 2018).
General jurisdiction is difficult to establish and requires extensive contacts between a defendant and forum. Id. at 101-02. A corporation is “at home” in [*6] its place of incorporation and its principal place of business. BNSF Ry. Co. v. Tyrrell, 137 S. Ct. 1549, 1558, 198 L. Ed. 2d 36 (2017). In an exceptional case, a corporate defendant’s operations in another forum may be so substantial and of such a nature as to render the corporation at home in that State. Id. The general jurisdiction inquiry does not focus solely on the magnitude of the defendant’s in-state contacts. Daimler, 571 U.S. at 139 n.20. It calls instead for an appraisal of a corporation’s activities in their entirety, nationwide and worldwide. Id. A corporation that operates in many places can scarcely be deemed at home in all of them. Id. Otherwise, “at home” would be synonymous with “doing business.” Id.
Specific jurisdiction is very different. Bristol-Myers, 137 S. Ct. at 1780. For a court to exercise specific jurisdiction, the lawsuit must arise out of or relate to the defendant’s contacts with the forum. Id. In other words, there must be “an affiliation between the forum and the underlying controversy, principally, [an] activity or an occurrence that takes place in the forum State and is therefore subject to the State’s regulation.” Id. (quoting Goodyear, 564 U.S. at 919). For this reason, “specific jurisdiction is confined to adjudication of issues deriving from, or connected with, the very controversy that establishes [*7] jurisdiction.” Id.

Analysis

1. General Jurisdiction
Cheetah contends that it is a Michigan entity without any continuous and systematic contacts with Texas. It has attached the declaration of its managing member, Abbey Kizy, in support of its motion to dismiss. According to Kizy, Cheetah does not own any property or assets in the State. It has no offices, employees, bank accounts, or phone numbers in Texas. Kizy states that Brown and Swanson were independent contractors of Cheetah pursuant to written agreements they signed in Michigan. All insurance policy documents were executed by Cheetah in Michigan. Cheetah obtained the policy from an insurance agent in Ohio. Kizy’s declaration states that Cheetah is not required to maintain, and does not maintain, a registered agent for service in Texas. In a supplemental declaration attached to Cheetah’s reply in support of its motion, Kizy clarified that Cheetah contracts with Humphrey Transportation Compliance, LLC to fulfill various compliance duties. Kizy stated she “now understand[s] that Humphrey appoints registered agents on behalf of Cheetah.”
Plaintiff responds that Cheetah operates in 49 states and advertises on its website that it “run[s] [*8] a lot of loads into and out of Texas border towns consisting of automotive parts, plastic pellets and dunnage.” According to Plaintiff, Cheetah has 34 primary routes, three of which originate in Texas, as well as 11 other “opportunity load routes” in Texas. Plaintiff argues that since one-tenth of Cheetah’s routes originate in Texas, Cheetah has the requisite minimum contacts from a general jurisdiction perspective. Plaintiff further relies on the fact that Cheetah hires employees who live in Texas. It also cites the fact that Cheetah designated an agent for service of process in Texas pursuant to the Motor Carrier Act. See 49 U.S.C. § 13304 (motor carrier shall designate agent in each State in which it operates on whom process issued by court with subject matter jurisdiction may be served).
The Court notes that Plaintiff and Cheetah disagree about whether Brown and Swanson were employees or independent contractors. At this stage, the Court will resolve this, and any other factual disputes, in Plaintiff’s favor. See Carmona, 924 F.3d at 193.
Plaintiff also asserts that when an interstate trucking company does business in a state and designates a registered agent under the Motor Carrier Act, the company consents to personal [*9] jurisdiction. Plaintiff cites Ocepek v. Corporate Transport, Inc., a 1991 opinion from the Eighth Circuit Court of Appeals, for this proposition. 950 F.2d 556 (8th Cir. 1991). The Fifth Circuit has not specifically addressed this issue. It has, however, held that designation of an agent for service of process under the Texas Business Corporations Act (now the Business Organizations Code) without more does not subject a corporation to jurisdiction. Wenche Siemer v. Learjet Acquisition Corp., 966 F.2d 179, 182-83 (5th Cir. 1992). In addition, Ocepek predates the Supreme Court’s opinion in Daimler. See AM Trust v. UBS AG, 681 F. App’x 587, 588 (9th Cir. 2017) (“It is an open question whether, after Daimler, a state may require a corporation to consent to general personal jurisdiction as a condition of registering to do business in the state.”). The Court declines to follow Ocepek. See Lyons v. Swift Transp. Co., No. 01-0209, 2001 U.S. Dist. LEXIS 15585, 2001 WL 1153001, at *7 (E.D. La. Sept. 26, 2001) (rejecting plaintiff’s contention that defendant consented to personal jurisdiction when it designated agent for service of process under Motor Carrier Act); Paz v. Castellini Co., No. B-07-036, 2007 U.S. Dist. LEXIS 83028, 2007 WL 3342214, at *7 (S.D. Tex. Nov. 8, 2007) (same).
Cheetah is domiciled in Michigan. For general jurisdiction to exist in a forum other than Michigan, this would have to be an “exceptional case” such that Cheetah’s corporate operations are so substantial and of such a nature as to render it at home in that forum. See [*10] Frank v. P N K (Lake Charles) L.L.C., 947 F.3d 331, 337-38 (5th Cir. 2020). As stated, designation of an agent for service of process in Texas, without more, does not constitute consent to the jurisdiction of Texas courts. Wenche Siemer, 966 F.2d at 182-83. The fact that 10% of Cheetah’s routes originate in Texas does not show that it has substantial, continuous, and systematic contacts here. See Poly Trucking, Inc. v. John R. Reed, Inc., No. 3:06-CV-1463-B, 2007 U.S. Dist. LEXIS 106351, 2007 WL 9711743, at *4 (N.D. Tex. Mar. 12, 2007) (no general jurisdiction over out-of-state trucking company where 2.7% of nationwide hauls involved Texas). Plaintiff has not demonstrated that Cheetah’s corporate contacts with Texas are of an exceptional nature such that it could be found at home here. See Lyons, 2001 U.S. Dist. LEXIS 15585, 2001 WL 1153001, at *5 (in suit filed in Louisiana arising out of Mississippi accident, no general jurisdiction as to Arizona trucking company that had four employees with Louisiana driver’s licenses, designated an agent under Motor Carrier Act, passed through Louisiana and occasionally delivered goods there).
2. Specific Jurisdiction
Cheetah also contends that it is not subject to specific personal jurisdiction as this lawsuit does not arise out of any contacts between Cheetah and Texas. It is a suit to interpret an insurance policy. Plaintiff does not allege that the insurance policy was formed or executed [*11] here. Cheetah asserts that the policy was issued to it in Michigan, through an Ohio insurance agent. The accident involved in the underlying lawsuit occurred in Illinois.
Plaintiff contends that Cheetah is subject to specific jurisdiction. It points to the fact that Cheetah employed two Texas drivers. Plaintiff argues Cheetah targeted Texas by hiring Texas residents to drive its tractor-trailers on routes across the United States, including Texas. Plaintiff argues that Cheetah therefore understood that any accident involving these two drivers could lead to a lawsuit in Texas.
The Court cannot conclude that Cheetah’s suit-related contacts are sufficient to subject it to jurisdiction in this forum. This is an insurance coverage dispute. This suit arises out of an insurance policy issued to a Michigan company in Michigan, purchased through an insurance agent in Ohio. The lawsuit is about whether there is insurance coverage for a vehicle accident that occurred in Illinois. Under the circumstances, the fact that the driver and passenger were from Texas and they were transporting goods to Texas are not substantial connections to this state.1 Cheetah’s Texas contacts are not linked to the procurement [*12] and enforcement of the National Casualty Company insurance policy. Cf. Eastern Concrete Materials, Inc. v. ACE Am. Ins. Co., 948 F.3d 289, 298 (5th Cir. 2020) (in Texas action by insurance company seeking declaratory judgment regarding its duty to defend or indemnify defendant, a New Jersey corporation, for incident at New Jersey rock quarry, defendant was subject to specific jurisdiction where defendant engaged, or authorized its Texas-based parent company to engage, Texas insurance broker to purchase policy in Texas).
Cheetah asks the Court to dismiss the case against it. Alternatively, it asks the Court to transfer the case to Michigan. Pursuant to 28 U.S.C. § 1404(a), for the convenience of the parties and witnesses, in the interest of justice, a court may transfer a civil action to any other district or division where it might have been brought. 28 U.S.C. § 1404(a). Cheetah asserts the individual defendants agreed to jurisdiction in Michigan. Kizy’s declaration states that Swanson and Brown signed Commercial Motor Vehicle and Carriage Service Agreements in Michigan in which they agreed that any legal proceeding with respect to the agreements may be brought in Michigan.
In its response to Cheetah’s motion, Plaintiff refuses to consider the possibility of transfer. It maintains the action should proceed [*13] in this Court as a matter of judicial efficiency and states that “[j]ustice does not oblige a transfer to Michigan.” The decision to dismiss a case rather than transfer is within the sound discretion of the district court. Caldwell v. Palmetto State Sav. Bank of S.C., 811 F.2d 916, 919 (5th Cir. 1987); see also Hoffman v. Blaski, 363 U.S. 335, 340-44, 80 S. Ct. 1084, 4 L. Ed. 2d 1254 (1960) (before case with multiple defendants can be transferred, it must be determined that all defendants would have been subject to personal jurisdiction in transferee court at time case was originally filed). Given Plaintiff’s complete opposition to transfer and the fact that Cheetah is not the only defendant, the Court will dismiss Plaintiff’s claims against Cheetah without prejudice for lack of jurisdiction rather than transfer.
SO ORDERED.
Signed September 16, 2020.
/s/ Ada Brown
ADA BROWN
UNITED STATES DISTRICT JUDGE