Meredith v. Steel Dynamics Inc.
Opinion of the Court
Before this court for consideration is defendant’s, Steel Dynamics, Inc., preliminary objections to plaintiffs’ complaint. For the following reasons, the preliminary objections are sustained.
I. Background
This case arises from personal injuries allegedly sustained by the plaintiff, Kenneth D. Meredith, as the result of an accident that occurred on or about May 20, 2010, at the defendant’s, Steel Dynamics, Inc., flat roll steel mill facility located in Butler, DeKalb County, Indiana. On or about April 19, 2011, the plaintiffs, Kenneth D. Meredith and Olive L. Meredith, husband and wife (hereinafter, collectively, “plaintiffs”), commenced the instant action against the defendants, Steel Dynamics, Inc. (hereinafter “SDI”) and R.A.M. Transit Lines, Inc. (hereinafter “R.A.M.”) (hereinafter, collectively, “defendants”), by filing a complaint in civil action in the office of the
On or about June 23, 2011, SDI filed preliminary objections to plaintiffs’ complaint, arguing that the plaintiffs’ complaint should be dismissed pursuant to rule 1028(a)(1) of the Pennsylvania Rules of Civil Procedure because the court of common pleas of Butler County, Pennsylvania, lacks jurisdiction over SDI; alternatively, SDI stated an objection to Mr. Meredith’s claim against SDI for vicarious liability at count III of the complaint, arguing that said claim should be dismissed pursuant to Pa.R.C.P. No. 1028(a)(1) for failure to state a claim upon which relief can be granted. See generally defendant’s, SDI, preliminary objections to plaintiffs’ complaint (hereinafter “preliminaiy objections”). An argument on SDI’s preliminary objections was scheduled and heard by the undersigned on October 5, 2011. Pursuant to an order of court under date of October 5, 2011, this court overruled SDI’s objection to Mr. Meredith’s claim for vicarious liability at count III of plaintiffs’ complaint due to the fact that vicarious liability and personal negligence are recognized as separate causes of action in the Commonwealth of Pennsylvania. See paragraph numbered II of the order of court under date of October 5, 2011.
In accordance with the orders of court dated October 5, 2011, and December 1, 2011, respectively, subsequent to the close of discovery on the issue, on or about March 15, 2012, SDI filed a motion to set briefing schedule and argument, thereby moving for further argument on their preliminary objection regarding this court’s jurisdiction over it in this action. As such, argument on the j urisdictional issue was scheduled and held before the undersigned on or about April 24, 2012, thereby necessitating the instant memorandum opinion. See order of court under date of March 15, 2012.
The first eight (8) paragraphs of the plaintiffs’ complaint identify each of the parties involved in this civil action, include general facts as to their respective residences and/or locations, and provide certain information relative to the named defendants’ jurisdictional ties to Butler County, Pennsylvania. While SDI is the only party whose jurisdictional ties to Butler County, Pennsylvania, are presently in question, we shall relay what has been
In support of their claims against the defendants, the facts of plaintiffs’ complaint are set forth as follows. The
On or about March 29, 2010, it is alleged that R.A.M. entered into an equipment lease agreement with Mr. Meredith “whereby [Mr. Meredith] would be retained as an owner-operator by [R.A.M.] to provide transportation services. See paragraph numbered 12 of the complaint. Subsequently, on or about May 20, 2010, the plaintiffs maintain that SDI directed R.A.M., “to transport and deliver an abrasive, hazardous dry mixture of lime, sand and aluminum shards,” to their DeKalb County facility. Id. at paragraph numbered 12. Also on or about May 20,2010, Mr. Meredith was retained by R.A.M. to transport the dry mixture of lime, sand and aluminum shards (hereinafter “lime mixture”), to the DeKalb County facility, “using a tractor owned by [Mr. Meredith] and a dry-bulk trailer and attendant equipment owned by [R.A.M.].” Id. at
The complaint further alleges that on May 20, 2010, Mr. Meredith arrived at SDI’s DeKalb County facility, proceeded through a checkpoint, and made his way to a silo on the premises where he was to deliver the lime mixture. Id. at paragraphs numbered 15, 16, and 17, respectively. The plaintiffs maintain that once at the designated silo, a rubber hose with cam locks at both ends was affixed to the silo so as to enable the lime mixture to be transferred from the dry-bulk trailer into the silo. Mr. Meredith then purportedly attached the cam lock at the opposite end of the hose to the dry-bulk trailer and began the unloading process by engaging the blower equipment on the truck, which created pressure to force the lime mixture from the diy-bulk trailer, through the hose, and into the silo. Id. at paragraphs numbered 18 through 23, respectively. The plaintiffs allege that at this time, Mr. Meredith “approached the hose to evaluate the unloading process, and the cam lock unexpectedly decoupled,” causing the hose to whip “violently and forcefully spray the [lime mixture].” Id. at paragraphs numbered 24 and 25, respectively. The plaintiffs further allege that the hose repeatedly struck Mr. Meredith and sprayed him with the lime mixture, which the plaintiffs contend is a hazardous material, thus causing Mr. Meredith to suffer physical injuries. Id. at paragraphs numbered 26 and 27, respectively. The complaint goes on to state that Mr. Meredith then deactivated the truck’s blower and used the cb radio to contact personnel at the checkpoint of the DeKalb County facility. See paragraphs numbered 28 and 29, respectively, of the complaint. The plaintiffs claim that SDI personnel failed to timely
The foregoing allegations form the basis of the plaintiffs’ four-count complaint. See generally, complaint. In count I of plaintiffs’ complaint, Mr. Meredith asserts a claim for negligence against SDI. In part, count I alleges that SDI was negligent due to its failure to maintain the hose, as well as the components of the hose, used to unload the lime mixture from the dry-bulk trailer into the silo, and in failing to have readily available and accessible first aid treatment. Id. at paragraphs numbered 38(a) through 38(ff), respectively. Moreover, the complaint alleges that SDI was negligent due to its entrustment of the “transportation and unloading of [lime mixture] at the silo on the premises of the [DeKalb County facility] to [R.A.M.], when it knew or should have known that [R.A.M.] was inexperienced, unsafe and/or incompetent.” Id. at paragraph numbered 38(ee). In count II of plaintiffs’ complaint, Mr. Meredith asserts a claim for negligence against R.A.M., stating allegations similar to those listed under count I of the complaint. Mr. Meredith raises a claim for vicarious liability against SDI in count III of plaintiffs’ complaint, maintaining that at all relevant times “SDI was acting by and through [R.A.M.], its authorized agent, joint venturer, servant and/or directee,” and that “[R.A.M.] was acting in furtherance of the business interests of [SDI].”
II. Rule of Law
Under the Pennsylvania rules of civil procedure, preliminary objections may be filed based upon a “lack of jurisdiction over the subject matter of the action...” as well as the “legal insufficiency of a pleading.” Pa.R.C.P. No. 1028(a)(1) andPa.R.C.P. No. 1028(a)(4). The movingparty has the burden of supporting its preliminary objections to the trial court’s jurisdiction. Schmitt v. Seaspray-Sharkline, Inc., 531 A.2d 801 (Pa. Super. 1987). Once jurisdiction is challenged, the burden of proof falls on the plaintiff to set forth facts establishing that jurisdiction in Pennsylvania is proper. Barr v. Barr, 749 A.2d 992,994 (Pa. Super. 2000). Moreover, once the plaintiff has produced some evidence to support jurisdiction, the defendant must come forward with some evidence of his own to dispel or rebut the plaintiff’s evidence. The moving party may not sit back and, by the bare allegations as set forth in the preliminary objections, and place the burden upon the plaintiff to negate those allegations. It is only when the moving party properly raises the jurisdictional issue that the burden
When considering preliminary objections, the court must accept all material facts set forth in the complaint, as well as all inferences reasonably deducible therefrom as admitted as true, and decide whether, based upon the facts averred, recovery is impossible as a matter of law. Wiernik v. PHH U.S. Mortg. Corp., 736 A.2d 616 (Pa. Super. 1999). The pleader’s conclusions of law, unwarranted inferences from the facts, argumentative allegations, or expressions of opinion are not admitted as true. See Giordano v. Ridge, 737 A.2d 350 (Pa. Comwlth. 1999). Further, preliminary objections should only be sustained in cases that are clear and free from doubt. Pennsylvania AFL-CIO ex. Re. George v. Com., 563 Pa. 108, 757 A.2d 917 (2000). Additionally, it should be clear from all the pleaded facts that the pleader will be unable to prove facts sufficient to legally establish a right to relief. Id. As such, any doubts should be resolved by refusing to sustain the objection. Ellenbogen v. PNC Bank, N.A., 731 A.2d 175 (Pa. Super.
III. Discussion
PLAINTIFFS’ COMPLAINT MUST BE DISMISSED PURSUANT TO PA.R.C.P. 1028(a)(1) BECAUSE THIS COURT LACKS JURISDICTION OVER SDI
In their preliminary objections to plaintiffs’ complaint, SDI argues that this court lacks subject matter jurisdiction over it as SDI is an Indiana corporation, organized and existing under the laws of the State of Indiana, it has not consented to the jurisdiction of Pennsylvania courts, and the requisite minimum contacts between SDI and the Commonwealth of Pennsylvania under the long-arm statute, 42 Pa.C.S.A. § 5301 et seq., and the due process clause fail to exist. See generally, SDI’s preliminaiy objections. In their supplemental brief in support of preliminary obj ections to jurisdiction, SDI further contends that, “The record created through discovery shows that SDI has virtually no contacts with Pennsylvania, much less the “continuous and systematic” contacts required for jurisdiction.” See page numbered 2 of SDI’s supplemental brief in support of preliminaiy objections to jurisdiction (hereinafter “supplemental brief in support”).
A state may exercise in personam jurisdiction over a nonresident defendant based either upon the specific acts of the defendant that gave rise to the cause of action or upon the defendant’s general activity within the state. See Kubik v. Letteri, 532 Pa. 10, 614 A.2d 1110 (1992); Derman v. Wilair Services, Inc., 404 Pa. Super. 136,590 A.2d 317 (1991). When a state exercises personal jurisdiction over a nonresident defendant in a suit arising
Pennsylvania law provides two bases for a court to exercise in personam jurisdiction over a corporation: general or specific jurisdiction. Fletcher-Harlee Corp.
42 Pa. C.S.A. § 5308 governs jurisdiction based on minimum contacts and provides that, “The tribunals of this Commonwealth may exercise jurisdiction under this subchapter only where the contact with this Commonwealth is sufficient under the constitution of the United States.” 42 Pa. C.S.A. § 5308. The question of whether a state may exercise in personam jurisdiction over a nonresident defendant must be tested against both the state’s long-arm statute and the due process clause of the fourteenth amendment to the United States constitution. Kubik v. Letteri, 532 Pa. 10,614 A.2d 1110 (1992); Kenny v. Alexson Equipment Co., 495 Pa. 107, 432 A.2d 974 (1981).
The due process clause of the fourteenth amendment imposes a limit on the state’s exercise of jurisdiction over a nonresident defendant, and protects an individual’s liberty interest by not allowing the individual to be subject to the jurisdiction of a foreign forum with which he or she has established no meaningful contacts, ties, or relations. See Kenny v. Alexson Equipment Co., 495 Pa. 107, 432 A.2d 974 (1981); Kubik v. Letteri, 532 Pa. 10, 614 A.2d 1110 (1992). The due process limitations on the assertion of specific personal jurisdiction over a nonresident
In the instant matter, the evidentiary record created through jurisdictional discovery and the laws of the Commonwealth of Pennsylvania support SDI’s argument that this court lacks jurisdiction over SDI. The accident that forms the basis for the plaintiffs’ lawsuit occurred at the DeKalb County facility in the State of Indiana. See paragraph numbered 9 of the complaint. SDI is an Indiana corporation with its principal place of business in Fort Wayne, Indiana. See affidavit of Richard A. Poinsatte, exhibit “A” of SDI’s supplemental brief in support. SDI has no officers or directors in the Commonwealth of Pennsylvania. Id. SDI does not maintain a mailing address, post office box, or telephone number in the Commonwealth of Pennsylvania. Id. SDI does not own,
While SDI made purchases from non-party vendors, the record shows that SDI makes no sales in the Commonwealth of Pennsylvania, and purchases are insufficient to confer jurisdiction. See Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984); Whalen v. Walt Disney World Co., 274 Pa. Super. 246,418 A.2d 389 (Pa. Super. 1980). All products manufactured by SDI are sold in the State of Indiana to Steel Dynamics Sales North America, Inc. (hereinafter “SDSNA”), a wholly owned subsidiary corporation; SDSNA, in turn, sells the products it purchases from SDI to thousands of different customers throughout the world. See summary of SDI sales to SDSNA from 2005-2010, exhibit “G” of SDI’s supplemental brief in support;
The evidentiary record created through jurisdictional discovery likewise demonstrates that “The Techs-A Division of Steel Dynamics, Inc.” is a wholly-owned subsidiary of SDI, and is registered with the Pennsylvania Department of State as a fictitious name, and is owned by The Techs Industries, Inc. (hereinafter “The Techs”), and is not a part of SDI. See Pennsylvania Corporations Database Business Entity Filing History, Exhibit “H” of SDI’s supplemental brief in support. As the Techs is a wholly-owned subsidiary of SDI whose contacts with the Commonwealth of Pennsylvania cannot be imputed to establish jurisdiction over SDI unless there is evidence that corporate separation has not been maintained; there is no such evidence here.
In light of the foregoing, SDI has clearly established that jurisdiction in the Court of Common Pleas of Butler County, Pennsylvania, is improper as SDI lacks sufficient meaningful contacts with the Commonwealth
ORDER OF COURT
And now, May 4,2012, upon consideration defendant’s, Steel Dynamics, Inc., preliminary objections to plaintiffs’ complaint, brief in support of preliminary objections to plaintiffs’ complaint, plaintiffs’, Kenneth D. Meredith and Olive L. Meredith, response to defendant Steel Dynamic [sic], Inc.’s preliminary objections, plaintiffs’ brief in opposition to defendant Steel Dynamics, Inc. ’s preliminary objections, defendant’s, Steel Dynamics, Inc., reply brief to plaintiff’s [sic] brief in opposition to defendant’s preliminary objections, defendant’s, Steel Dynamics, Inc., supplemental brief in support of preliminary objections to jurisdiction, plaintiffs’ supplemental response to defendant Steel Dynamics, Inc.’s preliminary objection to jurisdiction, supplemental brief in opposition to defendant Steel Dynamics, Inc.’s preliminary objections as to jurisdiction, defendant’s, Steel Dynamics, Inc., reply brief to plaintiffs’ brief in opposition to SDI’s supplemental brief in support of its preliminary objections to jurisdiction, oral argument thereon, and in accordance with the foregoing memorandum opinion, the defendant’s, Steel Dynamics, Inc., preliminary objections to plaintiffs’ complaint, relative to lack of jurisdiction are sustained, and this matter is to be forthwith transferred by the prothonotary’s office of Butler County, Pennsylvania, to office of the DeKalb County Clerk of Courts, P.O. Box 230, Auburn, Indiana 46706.
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