TCG Secures Dismissal After Full Briefing and Oral Argument Before the First Department

The Cook Group’s Hanson Horn and Ryan Sweeney secured a dismissal for their client after full briefing and oral argument before the New York First Department Appellate Division. By way of background, Hanson and Ryan moved for dismissal on behalf of an out of state product manufacturer in the maritime industry based on a lack of personal jurisdiction. The trial court denied the motion to dismiss, as well as the subsequent motion to reargue.  They appealed the denial of the motion to dismiss, and engaged in the months-long process of briefing the matter, culminating in live, in-person oral argument. After oral arguments, plaintiffs offered a voluntary dismissal, despite plaintiff’s identification of the manufacturer’s product as a source of his alleged asbestos exposure in New York during his deposition.

The matter involved a mesothelioma claimant who sailed aboard merchant vessels all over the globe during his career as a Merchant Mariner. At deposition, he testified to exposure to asbestos from their client’s products while working as a Merchant Marine engineer when docked at various ports including New York.

Sales logs established the products at issue were manufactured outside of New York and sold to a third party in Mississippi where they were installed on the two respective ships at issue during their construction. Subsequently, the two ships were sold to a third party who then traveled to various ports throughout the world, including in New York.

For the reasons stated above, Hanson and Ryan argued there was no causal connection between New York and the cause of action, regardless of whether the plaintiff encountered Defendant’s products in New York. Although CPLR § 302 provides four statutory bases by which specific jurisdiction can be exercised over foreign litigants in New York, plaintiffs cannot meet their burden of proof and offer evidence that plaintiffs’ claims against Defendant meet any of these statutory requirements.

Further, subjecting Defendant to jurisdiction in New York would violate the Due Process Clause. The United States Supreme Court has held that state courts cannot exercise personal jurisdiction over defendants without an adequate “connection between the forum and the specific claims at issue.” Bristol-Meyers Squibb, 137 S. Ct. at 1781. Specific jurisdiction is “confined to adjudication of issues deriving from, or connected with, the very controversy that establishes jurisdiction.” Here, decedent never encountered any of Defendant’s products which it had sold to New York, from New York, or manufactured in New York. Defendant was not involved in bringing those cargo ships or winches to New York and had no other relevant New York contact.

At the trial court, plaintiffs solely relied on CPLR §§ 302(a)(1) and (a)(3)(i) to exercise personal jurisdiction pursuant to New York’s long arm statute for specific personal jurisdiction. In support plaintiffs relied on plaintiff’s exposure in New York, Defendant’s past sales to New York, and that Defendant sold its products “for” a New York based company. The difference between “for” and “to” proved pivotal to personal jurisdiction.

On appeal, Hanson and Ryan argued the Supreme Court committed reversible error in exercising personal jurisdiction over Defendant on the following bases.

First, the Supreme Court erred when it found that Defendant was subject to specific personal jurisdiction under CPLR § 302(a)(1). Both Defendant’s documentary evidence and decedent’s own testimony show the products at issue were manufactured in Michigan and sold to Mississippi, not to New York.

Second, the Supreme Court also erred when it found Defendant was subject to specific personal jurisdiction under CPLR § 302(a)(3). The Supreme Court found that Defendant had other unrelated sales to New York and so there was a clear connection to plaintiffs’ specific claims. But the CPLR requires a showing that defendant had substantial revenue from New York, ongoing activity within New York, and a connection between defendants in state conduct and plaintiffs‘ claims – and this was missing in the matter at hand.

Finally, the Supreme Court erred in exercising personal jurisdiction over Defendant because of Due Process constraints. New York cannot exercise jurisdiction over a defendant where the product was sold to Mississippi and a third party unilaterally brought the product to New York.

 

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