LG Chem, Ltd. v. Tashia Hernandez

CourtCourt of Appeals of Texas
DecidedJuly 13, 2023
Docket11-21-00294-CV
StatusPublished

This text of LG Chem, Ltd. v. Tashia Hernandez (LG Chem, Ltd. v. Tashia Hernandez) is published on Counsel Stack Legal Research, covering Court of Appeals of Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
LG Chem, Ltd. v. Tashia Hernandez, (Tex. Ct. App. 2023).

Opinion

Opinion filed July 13, 2023

In The

Eleventh Court of Appeals __________

No. 11-21-00294-CV __________

LG CHEM, LTD., Appellant V. TASHIA HERNANDEZ, Appellee __________ -- and -- __________ No. 11-22-00008-CV __________

LG CHEM AMERICA, INC., Appellant V. TASHIA HERNANDEZ, Appellee

On Appeal from the 35th District Court Brown County, Texas Trial Court Cause No. CV1901031 MEMORANDUM OPINION Appellee, Tashia Hernandez, sued Appellants, LG Chem, Ltd. (LG Chem), LG Chem America, Inc. (LGCAI), and others for injuries she suffered when an 18650 lithium-ion battery exploded in her purse. Hernandez alleges that the battery was manufactured by LG Chem and distributed in Texas by LGCAI. Hernandez, a Texas resident, purchased the product in a Texas retail store, Cloud 9 Vape, and was injured in Texas. LG Chem and LGCAI each filed a special appearance challenging the trial court’s personal jurisdiction over both companies. The trial court denied the special appearance as to both companies. LG Chem and LGCAI each filed an appeal.1 In the wake of the appeals before us, the Texas Supreme Court issued its opinion in LG Chem America, Inc. & LG Chem, Ltd. v. Morgan, No. 21-0994, 2023 WL 3556693, at *1 (Tex. May 19, 2023). We affirm. Factual and Procedural History Hernandez purchased a lithium-ion battery from Cloud 9 Vape, located in Early, Texas. Hernandez was injured when the battery exploded in her purse, catching her purse, pants, undergarments, and shirt on fire, resulting in second- and third-degree burns. LG Chem manufactures 18650 lithium-ion batteries. Hernandez alleged in her petition that the battery which caused her injuries was manufactured by LG Chem and was marketed, sold, distributed, or otherwise placed into the stream of commerce by LG Chem and/or LGCAI. In her Second Amended Petition, Hernandez alleged that the trial court had jurisdiction over LG Chem because the company was “conducting business in the State of Texas in a continuous and systematic manner by marketing and/or selling its manufactured products in the State of Texas to Texas entities, including its

1 Although the appeals were filed separately, because they are from the same trial court cause number and the issues on appeal are similar in nature, we address both appeals together in this opinion. 2 subsidiary [LGCAI], and selling its manufactured products through dealers and/or distributors in the State of Texas.” Hernandez made similar jurisdictional allegations as to LGCAI, alleging that LGCAI “continues to conduct business in the State of Texas in a continuous and systematic manner by marketing, selling, distributing, and/or importing products manufactured by Defendant [LG Chem] into and throughout the State of Texas.” She further alleged that LGCAI maintains a license to do business in Texas, and that LGCAI generates significant revenue from Texas- based sales. Hernandez specifically alleged that LG Chem manufactures the battery that forms the basis of the lawsuit, and that LGCAI distributes those batteries in Texas. LG Chem is a foreign corporation that is headquartered in South Korea. LGCAI is a domestic corporation that is incorporated in Delaware and headquartered in Georgia. In their special appearance motions, both companies contended that there was no basis on which the trial court could exercise either general jurisdiction or personal jurisdiction over LG Chem or LGCAI. Notably, in the response opposing their special appearances, Hernandez concedes that neither company is “at home” in Texas for purposes of general jurisdiction. Thus, the only jurisdictional issue before the trial court was whether it could exercise personal jurisdiction over LG Chem and LGCAI. During the hearing on the special appearance motions, LG Chem and LGCAI, in carefully crafted language, maintained that they never targeted or sought to “serve a market for standalone consumer batteries in Texas or any place else.” This oft- repeated, jurisdictionally-directed language used by LG Chem and LGCAI in their motions and briefs appears calculated to limit the relevant market forum for the State of Texas to a narrower consumer market segment. At no point did LG Chem or LGCAI argue that they did not market 18650 cells in Texas or that LG Chem does not manufacture these batteries. They argue that they did not serve a market for 3 “standalone consumer batteries,” rather than denying that they manufacture or sell them in Texas at all. While Appellants attempted to cast doubt on Hernandez’s documentary sales evidence in support of her petition, Appellants did not object or obtain a ruling as to a lack of authenticity or the admissibility of the evidence. On appeal, LG Chem insinuates that the documentary sales evidence that Hernandez presented to the trial court was undecipherable and thus unreliable, but without any objection to the evidence, the trial court properly considered the sales records presented for the limited purpose of supporting the pleadings and to determine its jurisdiction. LG Chem argues on appeal that the trial court erred in denying its special appearance because Hernandez failed to allege the existence of purposeful contacts between LG Chem and Texas which relate to or give rise to her claim (i.e., deficient pleadings). LGCAI makes a similar argument, adding that even if LG Chem had contacts in Texas that would be sufficient for purposes of personal jurisdiction, those contacts may not be imputed to LGCAI. LG Chem and LGCAI also argue that Hernandez did not allege any facts to establish that either company “sought to serve any consumer market in Texas, let alone a Texas consumer market for standalone lithium-ion batteries for e-cigarettes.” Standard of Review and Applicable Law Whether a trial court has personal jurisdiction over a non-resident defendant is a question of law that is reviewed de novo. Luciano v. SprayFoamPolymers.com, LLC, 625 S.W.3d 1, 8 (Tex. 2021). “When, as here, the trial court does not issue findings of fact and conclusions of law with its judgment, we presume all factual disputes were resolved in favor of the trial court’s decision unless they are challenged on appeal.” Id. Texas courts may assert personal jurisdiction over non- residents if the Texas long-arm statute authorizes the exercise of jurisdiction and the exercise of jurisdiction is consistent with federal due process guarantees. State v. 4 Volkswagen Aktiengesellschaft, No. 21-00130, 2023 WL 3262271, at *7 (Tex. May 5, 2023); see also TEX. CIV. PRAC. & REM. CODE §§ 17.041, 17.042 (West 2015). “The ‘touchstone of jurisdictional due process’ is ‘purposeful availment.’” TV Azteca v. Ruiz, 490 S.W.3d 29, 45 (Tex. 2016) (quoting Michiana Easy Livin’ Country, Inc. v. Holten, 168 S.W.3d 777, 784 (Tex. 2005)). In determining whether a non-resident’s contacts with the forum state break the threshold of purposeful availment, we assess “the quality and nature of the contacts, not the quantity.” Moncrief Oil Int’l Inc. v. OAO Gazprom, 414 S.W.3d 142, 151 (Tex. 2013). “The Fourteenth Amendment’s Due Process Clause limits a state court’s power to exercise jurisdiction over a defendant.” Ford Motor Co. v. Montana Eighth Jud. Dist. Ct., 141 S. Ct. 1017, 1024 (2021). In the landmark case of International Shoe Co. v. Washington, the Supreme Court held that this jurisdictional authority depends on the “defendant’s having such ‘contacts’ with the forum State that ‘the maintenance of the suit’ is ‘reasonable, in the context of our federal system of government,’ and ‘does not offend traditional notions of fair play and substantial justice.’” Id. (quoting International Shoe Co. v.

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LG Chem, Ltd. v. Tashia Hernandez, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lg-chem-ltd-v-tashia-hernandez-texapp-2023.