Court of Appeal of Louisiana,

First Circuit.

Steven C. TAYLOR

v.

J. Jesus ARELLANO, Transcor America, L.L.C., General Accident Insurance

Company, Glenn E. Evans, Transport America, and Great West Casualty Company.

Dec. 22, 2005.

On Appeal from the 22nd Judicial District Court Parish of St. Tammany, Louisiana Docket No. 2003-10363, Division “F”. Honorable Martin E. Coady, Judge Presiding.

ANALYSIS

This case arises out of a two-vehicle accident that occurred in Michigan. Taylor, a Louisiana resident, was being transported with other prisoners in a cargo van owned by Transcor America and driven by its employee, Glenn Evans, when Evans lost control of the van and collided with an eighteen-wheeler owned by TCA and driven by its employee, Arellano, injuring Taylor. After being named as defendants in Taylor’s lawsuit, TCA and Arellano objected to the Louisiana court’s personal jurisdiction over them. An affidavit in support of their exception averred that Arellano was and continued to be a Texas resident and had no connection whatsoever with the state of Louisiana. TCA, a Minnesota corporation with its principal place of business in Minnesota, alleged it had no place of business in Louisiana and did not regularly conduct any business here. It had only occasional random contact with Louisiana if one of its drivers happened to pass through the state or, even less frequently, made a delivery in Louisiana. However, neither the TCA vehicle, driver, or shipment when this accident occurred had any connection with Louisiana.

. TCA’s insurer, Great West Casualty Company, was also named as a defendant.

Taylor offered no arguments or evidence to show how the Louisiana court might have acquired personal jurisdiction over Arellano. Therefore, the dismissal of the claim against him is affirmed without further comment from this court.

As to TCA, Taylor opposed the exception, arguing that a federal statute required TCA to appoint an agent for service of process in each state in which it operated, and that the statute thereby provided for personal jurisdiction over motor carriers in states through which they might only traverse occasionally in the course of their business. The federal statute upon which he relies is 49 U.S.C .A. § 13304, which states, in pertinent part:

(a) Designation of agent–A motor carrier or broker providing transportation subject to jurisdiction under chapter 135, … shall designate an agent in each State in which it operates by name and post office address on whom process issued by a court with subject matter jurisdiction may be served in an action brought against that carrier or broker. The designation shall be in writing and filed with the Department of Transportation and each State in which the carrier operates may require that an additional designation be filed with it. If a designation under this subsection is not made, service may be made on any agent of the carrier or broker within that State.

This statute is often referred to as the “Motor Carrier Act.”

Taylor claims TCA was required to designate an agent for service of process in Louisiana, that there was a designated agent, and that service was made on that agent, thereby acquiring jurisdiction over the person of TCA. In the alternative, in the event TCA did not have an agent and service was made on an incorrect agent, Taylor contends TCA cannot, by failing to comply with the statute, avoid the assertion of personal jurisdiction by the courts of this state. Although he contended the Motor Carrier Act obviated the need to determine whether TCA had “minimum contacts” with the state, Taylor also claimed that the affidavit submitted by TCA showed that its contacts with the state sufficed to bring it within the personal jurisdiction of the Louisiana court.

Replying to Taylor’s opposition, TCA submitted documents from the Louisiana Secretary of State, which were referenced in its answers to interrogatories and which showed TCA had not applied for authority to do business in Louisiana and had not appointed an agent for service of process in Louisiana. TCA denied Taylor’s claim that any such agent existed or had been served, and contended, in any event, that such designation or service would not operate as a consent to suit in Louisiana for causes of action arising elsewhere.

Under the express wording of the present Louisiana long-arm statute, LSA-R.S. 13:3201, et seq., the sole inquiry into jurisdiction over a nonresident is an analysis of the constitutional due process requirements. If the assertion of jurisdiction meets the constitutional requirements of due process, the assertion of jurisdiction is authorized under the long-arm statute. The limits of the Louisiana long-arm statute and the limits of constitutional due process are coextensive. Petroleum Helicopters, Inc. v. Avco Corp., 513 So.2d 1188, 1192 (La.1987); A & L Energy, Inc. v. Pegasus Group, 00-3255 (La.6/29/01), 791 So.2d 1266, 1270. A two-part test is to be applied in determining whether in personam jurisdiction would violate due process: (1) there must be a “minimum contact” from an affirmative act of the defendant, and (2) it must be fair and reasonable to require the defendant to come into the state to defend the action. Sears, Roebuck & Co. v. Ballard, 517 So.2d 233, 235-36 (La.App. 1st Cir.1987). The minimum contacts prong of the due process analysis may be satisfied if the contacts give rise to specific personal jurisdiction or to general personal jurisdiction. Specific jurisdiction over a defendant occurs when the plaintiff’s claim arises out of or relates to the defendant’s contacts with the forum state. Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 n. 8, 104 S .Ct. 1868, 1872 n. 8, 80 L.Ed.2d 404 (1984). In the absence of conduct giving rise to specific jurisdiction, general jurisdiction will exist when the defendant has engaged in “systematic and continuous” activities in the forum state. Id. at n. 9. While the distinction between “general” and “specific” jurisdiction provides a useful analytic device, the use of these categories does not eliminate the need to evaluate each assertion of personal jurisdiction in light of traditional notions of fair play and substantial justice. de Reyes v. Marine Management and Consulting, Ltd., 586 So.2d 103, 109 (La.1991).

We are aware that in a case involving the reach of the Louisiana court’s subpoena power, the supreme court stated in dicta that a principal consequence of designating an agent for service of process is to subject the foreign corporation to jurisdiction in a Louisiana court. See LSA-C.C.P. arts. 6, 1235, 5251(2); Phillips Petroleum Co. v. OKC Ltd. P’ship, 93-1629 (La.4/11/94), 634 So.2d 1186, 1187. The court noted that even if the corporation’s only “presence” is in its designating an agent for service of process, that designation facilitates its being sued in a Louisiana court and exposes it to personal jurisdiction. Id. at 1188. Despite the broad implication of these statements, we note that the issue before the court was not whether such a designation would automatically function as consent to personal jurisdiction in the state for suits arising out-of-state, when the defendant corporation did not have contacts within the state sufficient to satisfy due process. We believe the key words in this discussion by the supreme court were that the designation of an agent “facilitates” such suits and “exposes” the corporation to personal jurisdiction; the court did not address the factual circumstances under which such “exposure” would allow the exercise of such jurisdiction by the Louisiana court, because this was not the issue before it.

Moreover, in Perkins v. Benguet Consol. Mining Co., 342 U.S. 437, 72 S.Ct. 413, 96 L.Ed.485 (1952), the United States Supreme Court concluded that regardless of the presence of an agent for service of process, the court must still determine on a case-by-case basis whether the amount and kind of activities carried on by the foreign corporation in the state of the forum were sufficient to make it reasonable and just to subject the corporation to personal jurisdiction in that state. The court emphasized that the corporate activities of a foreign corporation which, under a state statute, make it necessary for it to secure a license and to designate a statutory agent upon whom process may be served provide a helpful, but not a conclusive test. Perkins, 342 U.S. at 446, 72 S.Ct. at 419. It thereby rejected the argument that the mere presence of an agent for service of process automatically satisfied the requirements of due process.

Accordingly, we are not persuaded by Taylor’s argument, based on the provisions of 49 U.S.C.A. § 13304, that this statute confers personal jurisdiction on any interstate motor carrier in any state through which its trucks might travel, however infrequently. First, as a factual matter, we note that there is no return on service in this record to establish that service was made on TCA through a registered agent or by any other means. Second, Taylor did not establish that TCA has or had a registered agent in this state, pursuant to this or any other statute. On the contrary, TCA’s answers to interrogatories and the documents referenced therein indicate that TCA does not have a registered agent for service of process in Louisiana. Third, and most importantly, even if TCA had such an agent and service was made on that agent, this fact alone would not suffice to establish personal jurisdiction. In Lyons v. Swift Transportation Co., Inc., No. 01-0209, 2001 WL 1153001 (E.D.La.9/26/01), the trucking company defendant had designated an agent for service of process, pursuant to the Motor Carrier Act, and was served through that agent. Yet the court found that under Louisiana law, a minimum contacts analysis was still applicable to the facts of the case. It determined that the plaintiff’s cause of action did not arise from any of the trucking company’s actions in the state, so there was no “specific jurisdiction.” In further reviewing the facts to determine if there was “general jurisdiction,” the court noted that the trucking company’s contacts with the state, consisting of occasional travel through Louisiana and deliveries here “from time to time” were not sufficient to subject it to the personal jurisdiction of the Louisiana court. The court stated that the plaintiff “has not shown that Swift trucks regularly travel in or through Louisiana” and “presents no record evidence establishing the volume of business Swift does in Louisiana or the frequency with which Swift’s trucks pass through Louisiana.” Lyons, 2001 WL 1153001 at p. 4. The court concluded:

Accordingly, the Court finds that designating an agent under the Motor Carrier Act, having four employees with Louisiana driver’s licenses, being involved in one accident in Louisiana in the past 30 months, passing through Louisiana and occasionally delivering goods in Louisiana, is insufficient to establish general personal jurisdiction over Swift.

The Lyons court also rejected the plaintiff’s argument that the defendant trucking company, having registered an agent for service in Louisiana pursuant to the Motor Carrier Act, had thereby consented to suit in Louisiana for suits based on events occurring outside of Louisiana. Citing Fifth Circuit precedent, the court stated that appointment of an agent for service, whether pursuant to a state statute or a federal statute, did not operate as an automatic consent to suits in the state, and that the minimum contacts analysis was still required. Lyons, 2001 WL 1153001 at p. 6-7, citing Wenche Siemer v. Learjet Acquisition Corp., 966 F .2d 179, 183 (5th Cir.1992), cert. denied, 506 U.S. 1080, 113 S.Ct. 1047, 122 L.Ed.2d 356 (1993).

Based on this jurisprudence and the facts of this case, we conclude that the courts of this state did not have personal jurisdiction over TCA, a Minnesota corporation, for the claims alleged in this lawsuit. The accident did not occur in Louisiana; the vehicle was not registered here; and the trip on which the truck was engaged had nothing to do with this state. Under these facts, Taylor’s claim did not arise out of or relate to TCA’s contacts with the state of Louisiana. Therefore, there was no “specific jurisdiction.” Moreover, the affidavit submitted by TCA in support of its exception established that its contacts with Louisiana were random and occasional, and do not meet the requirement of systematic and continuous contacts in order for “general jurisdiction” to exist. Therefore, we conclude the district court was legally correct in maintaining the exception, in finding the Louisiana court could not exert personal jurisdiction over TCA, and in dismissing Taylor’s claims against it.

CONCLUSION

For the foregoing reasons, we affirm the judgment of the district court. All costs of this appeal are assessed against Taylor.

United States District Court,

M.D. Alabama, Eastern Division.

William C. MEIGS, d/b/a Abanda Timber Co., Plaintiff

v.

CSX TRANSPORTATION, INC., a corporation, et al., Defendants.

Dec. 9, 2005.

MEMORANDUM OPINION AND ORDER

 

FULLER, Chief J.

INTRODUCTION

Plaintiff William C. Meigs (“Plaintiff”) brings this action against Defendants CSX Transportation, Inc., et al., (collectively “Defendants”) asserting a multitude of claims under Alabama law. The Plaintiff’s complaint was originally filed in the Chambers County, Alabama Circuit Court on March 29, 2004, and the Defendants removed the case to this Court on April 30, 2004 (Doc. # 3). This cause is presently pending before the Court on the Plaintiff’s Motion to Remand (Doc. # 18), filed on May 28, 2004. Upon consideration of the submissions of the parties, the Court finds the motion must be DENIED.

DISCUSSION

In his motion, the Plaintiff contends that remand is proper in this case because the parties are not completely diverse as required by 28 U.S.C. § § 1332, 1441(a), and 1446(b). Specifically, the Plaintiff, a resident of Alabama, argues that the presence of Defendant Roger Jackson (“Jackson”), also an Alabama resident, destroys diversity in this action and necessitates remand. However, in its November 8, 2004 Order (Doc. # 36), the Court granted Jackson’s unopposed Motion for Judgment on the Pleadings (Doc. # 32). This ruling was in response to an admission on the part of the Plaintiff that Jackson was not properly a party in this action. Thus, the jurisdictional question before the Court turns on whether Jackson was fraudulently joined.

. The Defendants also expend considerable effort arguing that the claims here are completely preempted by the Carmack Amendment. Such a finding by the Court would then allow removal of this case based on federal question jurisdiction irrespective of the Court’s resolution of the fraudulent joinder issue. See Beneficial Nat’l Bank v. Anderson, 539 U.S. 1, 123 S.Ct. 2058, 156 L.Ed.2d 1 (2003). Because the Court finds that diversity jurisdiction is proper, it is currently unnecessary to reach the applicability of the Carmack Amendment.

As a general matter, the removal of a case from state to federal court is proper if the case could have originally been brought in federal court. See Jeter v. Orkin Exterminating Co., 84 F.Supp.2d 1334, 1336 (M.D.Ala.2000) (citing 28 U.S.C. § 1441(a)). Federal courts may assert jurisdiction over cases brought under state law where the parties are of diverse state citizenship and the amount in controversy exceeds $75,000. See id. (citing 28 U.S.C. § 1332). The Supreme Court has interpreted diversity of citizenship under § 1332 to require complete diversity–that is, every plaintiff must be of diverse state citizenship from every defendant. Palmer v. Hospital Auth. of Randolph County, 22 F.3d 1559, 1564 (11th Cir.1994) (citing Strawbridge v. Curtiss, 3 Cranch. (7 U.S.) 267, 2 L.Ed. 435 (1808)). While the presence of a plaintiff and defendant residing in the same state normally precludes federal jurisdiction based on diversity of citizenship, diversity jurisdiction “cannot be defeated by a fraudulent joinder of a residential defendant having no real connection to the controversy.” Jeter, 84 F.Supp.2d at 1337 (quoting Wilson v. Republic Iron & Steel Co., 257 U.S. 92, 97, 42 S.Ct. 35, 66 L.Ed. 144 (1921)). Thus, the Court shall disregard fraudulently joined defendants when considering the propriety of maintaining jurisdiction. Tedder v. F.M.C. Corp., 590 F.2d 115, 117 (5th Cir.1980).

Decisions of the former Fifth Circuit rendered prior to October 1, 1981 are binding authority in the Eleventh Circuit. See Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir.1981) (en banc).

The Eleventh Circuit has found fraudulent joinder in three situations: where (1) “there is no possibility that the plaintiff can prove a cause of action against the resident (non-diverse) defendant,” (2) “there is outright fraud in the plaintiff’s pleading of jurisdictional facts,” and (3) “a diverse defendant is joined with a nondiverse defendant as to whom there is no joint, several or alternative liability and where the claim against the diverse defendant has no real connection to the claim against the nondiverse defendant.” Triggs v. John Crump Toyota, 154 F.3d 1284, 1287 (11th Cir.1998). Under all of these scenarios, the removing party bears the “heavy burden” of demonstrating by clear and convincing evidence that the joinder of a non-diverse party was fraudulent. Cabalceta v. Standard Fruit Co., 883 F.2d 1553, 1561 (11th Cir.1989). In their motions, the Defendants have focused their efforts on the first and third varieties of fraudulent joinder, and the Court will do the same.

Under the first type of fraudulent joinder, federal jurisdiction cannot be sustained where “there is even a possibility that a state court would find that the complaint states a cause of action against … the resident defendant [ ].” Triggs, 154 F.3d at 1287 (internal quotations omitted). “The plaintiff need not have a winning case against the allegedly fraudulent defendant; he need only have a possibility of stating a valid cause of action in order for the joinder to be legitimate.” Id. While the court must make this determination based on the plaintiff’s pleadings at the time of removal, “the court may consider affidavits and deposition transcripts submitted by the parties.” Crowe v. Coleman, 113 F.3d 1536, 1538 (11th Cir.1997).

Here, by the Plaintiff’s own admission, he has not stated a valid cause of action against Jackson. Indeed, the Plaintiff has conceded that his suit against Jackson was a mistake and that he intended to sue another CSX employee, Dan Payne. In accordance with these events, the Court granted Jackson’s unopposed Motion for Judgment on the Pleadings as the pleadings and evidence before the Court demonstrated “beyond doubt that the plaintiff [could] prove no set of facts in support of his claim which would entitle him to relief.” Hawthorne v. Mac Adjustment, Inc., 140 F.3d 1367, 1370 (11th Cir.1998) (citation and internal quotations omitted). As such, there was no “possibility that a state court would find that the complaint states a cause of action against [Jackson].” Crowe, 113 F.3d at 1538 (quoting Coker v. Amoco Oil Co., 709 F.2d 1433, 1440-41 (11th Cir.1983)). This conclusion satisfies the requirements of fraudulent joinder and means that diversity jurisdiction is appropriate in this case. See Mayes v. Rapoport, 198 F.3d 457, 461 (4th Cir.1999) (stating that fraudulent joinder “permits a district court to disregard, for jurisdictional purposes, the citizenship of certain nondiverse defendants, assume jurisdiction over a case, dismiss the [fraudulently joined] nondiverse defendants, and thereby retain jurisdiction.”).

Up to this point, the Plaintiff has not elected to amend his complaint to add Payne as a defendant. The Court does note that Payne’s presence would not change the Court’s ability to assert jurisdiction over this cause because Payne is a resident of Florida.

Because the Court finds the first variety of fraudulent joinder to be satisfied, it is unnecessary to perform an analysis of the third category of fraudulent joinder, also known as misjoinder or the Tapscott doctrine. See Tapscott v. MS Dealer Serv. Co., 77 F.3d 1353, 1360 (11th Cir.1996) abrogated on other grounds by, Cohen v. Office Depot, Inc., 204 F.3d 1069 (11th Cir.2000).

As the Court concludes that the parties before the Court are completely diverse, subject matter jurisdiction is properly premised on 28 U.S.C. § 1332. Therefore, upon consideration of the Plaintiff’s Motion to Remand (Doc. # 18) filed on May 28, 2004, it is hereby

ORDERED that the motion is DENIED.