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Malcolm v. Acrylic Tank Manufacturing, Inc.

United States District Court, D. Nevada

July 6, 2017

STEVEN MALCOLM, Plaintiffs,
v.
ACRYLIC TANK MANUFACTURING, INC., et al, Defendants.

          ORDER

         Presently before the court is defendant Reynolds Polymer Technology, Inc.'s (“Reynolds”) motion to dismiss. (ECF No. 6).[1] Plaintiff Steven Malcom filed a response (ECF No. 8), to which Reynolds replied (ECF No. 10).

         I. Facts

         This action arises from the destruction of plaintiff's aquarium allegedly caused by a product defect. Plaintiff, a resident of Scotland, contacted defendant Acrylic Tank Manufacturing of Nevada (“ATM”) in 2007 to “design, engineer, fabricate, and install a custom state-of-the-art . . . aquarium.” (ECF No. 1 at 3). After receiving the contract, ATM contacted Reynolds in June of 2007 to manufacture the tank. (ECF No. 6 at 16).

         Reynolds completed fabrication of the tank and shipped it directly to Scotland from its warehouse in Colorado. (ECF No. 6 at 6). The tank's dimensions measured 3.5 meters in diameter by 10 meters in height-the tank was designed to accommodate approximately 25, 000 gallons of water. (ECF No. 1-1 at 2). Reynolds did not participate in the tank's installation as “ATM supplied its own engineers and builders to install the aquarium” in plaintiff's home. (ECF No. 1 at 3). ATM completed installation in Scotland in March 2010. (ECF No 1 at 3). On November 30, 2015, approximately five years and eight months later, the tank allegedly collapsed and its contents flowed through plaintiff's home causing damages in excess of £5, 900, 00.00 GBP ($7, 550, 000.00). (Id.).

         On April 21, 2017, plaintiff filed the underlying complaint alleging seven claims of relief: (1) breach of contract against ATM; (2) breach of implied warranty of merchantability against ATM; (3) breach of implied warranty of fitness for a particular purpose against ATM; (4) negligence against ATM and Reynolds; (5) strict liability against ATM and Reynolds; (6) breach of implied warranty of merchantability against Reynolds; and (7) breach of implied warranty of fitness for a particular purpose against Reynolds. (ECF No. 1).

         In the instant motion, Reynolds argues that dismissal of claims (4) through (7), as they relate to Reynolds, is appropriate pursuant to Federal Rule of Civil Procedure 12(b)(2) because the court lacks personal jurisdiction. (ECF No. 6).

         II. Legal Standard

         Federal Rule of Civil Procedure 12(b)(2) allows a defendant to move to dismiss for lack of personal jurisdiction. See Fed. R. Civ. P. 12(b)(2). To avoid dismissal under Rule 12(b)(2), the plaintiff bears the burden of demonstrating that its allegations establish a prima facie case for personal jurisdiction. See Boschetto v. Hansing, 539 F.3d 1011, 1015 (9th Cir. 2008). Allegations in the complaint must be taken as true and factual disputes should be construed in the plaintiff's favor. Rio Props., Inc. v. Rio Int'l Interlink, 284 F.3d 1007, 1019 (9th Cir. 2002).

         “When no federal statute governs personal jurisdiction, the district court applies the law of the forum state.” Boschetto, 539 F.3d at 1015; see also Panavision Int'l L.P. v. Toeppen, 141 F.3d 1316, 1320 (9th Cir. 1998). Where a state has a “long-arm” statute providing its courts jurisdiction to the fullest extent permitted by the due process clause, as Nevada does, a court need only address federal due process standards. See Arbella Mut. Ins. Co. v. Eighth Judicial Dist. Court, 134 P.3d 710, 712 (Nev. 2006) (citing Nev. Rev. Stat. § 14.065); see also Boschetto, 539 F.3d at 1015.

         An assertion of personal jurisdiction must comport with due process. See Wash. Shoe Co. v. A-Z Sporting Goods Inc., 704 F.3d 668, 672 (9th Cir. 2012). Two categories of personal jurisdiction exist: (1) general jurisdiction; and (2) specific jurisdiction. See Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 413-15 (1984); LSI Indus., Inc. v. Hubbell Lighting, Inc., 232 F.3d 1369, 1375 (Fed. Cir. 2000).

         General jurisdiction arises where a defendant has continuous and systematic ties with the forum state, even if those ties are unrelated to the litigation. See Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163, 1171 (9th Cir. 2006) (citing Helicopteros Nacionales de Columbia, S.A., 466 U.S. at 414-16). “[T]he plaintiff must demonstrate the defendant has sufficient contacts to constitute the kind of continuous and systematic general business contacts that approximate physical presence.” In re W. States Wholesale Nat. Gas Litig., 605 F.Supp.2d 1118, 1131 (D. Nev. 2009) (internal quotation marks and citations omitted). In other words, defendant's affiliations with the forum state must be so “continuous and systematic” as to render it essentially “at home” in that forum. See Daimler AG v. Bauman, 134 S.Ct. 746, 760-61 (2014) (“Daimler”). “This is an exacting standard as it should be, because a finding of general jurisdiction permits a defendant to be haled into court in the forum state to answer for its activities anywhere in the world.” Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 801 (9th Cir. 2004).

         Specific jurisdiction arises where sufficient contacts with the forum state exist such that the assertion of personal jurisdiction “does not offend ‘traditional notions of fair play and substantial justice.'” Int'l Shoe Co. v. State of Wash., 326 U.S. 310, 316 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463 (1940)). The Ninth Circuit has established a three-prong test for analyzing an assertion of specific personal jurisdiction:

(1) The non-resident defendant must purposefully direct his activities or consummate some transaction with the forum or resident thereof; or perform some act by which he purposefully avails himself of the privilege of conducting activities in the ...

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