Paz v. Brush Eng Materials

489 F.3d 719

• Court: Court of Appeals for the Fifth Circuit
• Decided: April 10, 2006
• Docket: 05-60157
• Status: Published

Opinion

United States Court of Appeals Fifth Circuit F I L E D IN THE UNITED STATES COURT OF APPEALS April 7, 2006 FOR THE FIFTH CIRCUIT Charles R. Fulbruge III ______________________ Clerk

No. 05-60157 ______________________

GEORGE PAZ, ET AL.,

Plaintiffs-Appellants

versus

BRUSH ENGINEERED MATERIALS, INC. ET AL.,

Defendants-Appellees

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GEORGE PAZ; ET AL.,

Plaintiffs

Defendants

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JOSEPH P HARRIS, ET AL.,

WESS-DEL, INC.

Defendant-Appellee

1 ___________________________________________________

Appeals from the United States District Court for the Southern District of Mississippi ___________________________________________________

Before DAVIS, SMITH, and DENNIS, Circuit Judges.

DENNIS, Circuit Judge:

Class action appellants have sued the appellees in this case,

claiming exposure to airborne beryllium at Boeing’s space center

facilities in Mississippi. For relief, the appellants seek to

establish a medical monitoring fund. Appellee Boeing employs most

of the proposed class members, who were allegedly exposed to the

beryllium during the manufacture of parts for a space shuttle.

Appellant Brush Wellman, Inc. (“Brush Wellman”) sold to Boeing many

of the beryllium-containing products that are the alleged source of

the toxic exposure. Appellant Brush Engineered Materials,

Inc.(“BEMI”) is the parent company of Brush Wellman. Appellant

Wess-Del, Inc. (“Wess-Del”) is a distributor of beryllium-

containing products that allegedly sold such goods to Boeing with

the knowledge that they would be used in space shuttle construction

in Boeing’s Mississippi facility. The appellees moved to dismiss

for the following reasons: (1) because Mississippi does not

recognize a medical monitoring cause of action; (2) for lack of

jurisdiction over the defendants. The district court granted both

motions. Upon reviewing the case, we reverse the district court’s

ruling on jurisdiction and certify the medical monitoring question

2 to the Mississippi Supreme Court.

Jurisdiction

The appellants challenge the district court’s ruling that it

did not have personal jurisdiction over Wess-Del because Wess-Del

lacked the requisite contacts with Mississippi. The district

court’s dismissal for lack of personal jurisdiction is reviewed de

novo. Panda Brandywine Corp. v. Potomac Elec. Power Co., 253 F.3d

865, 867 (5th Cir. 2001). Where, as here, the district court rules

on a motion to dismiss for lack of personal jurisdiction without an

evidentiary hearing, the plaintiff need only make a prima facie

case that jurisdiction is proper. Quick Technologies, Inc. v. Sage

Group, PLC, 313 F.3d 338, 343 (5th Cir. 2002) (citations omitted).

The district court is not obligated to consult only the assertions

in the plaintiff’s complaint in determining whether a prima facie

case for jurisdiction has been made. Rather, the district court

may consider the contents of the record at the time of the motion,

including affidavits...” Id. (citing Thompson v. Chrysler Motors

Corp., 755 F.2d 1162, 1165 (5th Cir. 1985)). However, in

determining whether a prima facie case for personal jurisdiction

exists on a motion to dismiss, “uncontroverted allegations in the

plaintiff's complaint must be taken as true.” Bullion v. Gillespie,

895 F.2d 213, 217 (5th Cir. 2005) (citing D.J. Investments, Inc.

v. Metzeler Motorcycle Tire Agent Gregg, Inc., 754 F.2d 542, 546

(5th Cir.1985)). See also Kelly v. Syria Shell Petroleum Dev.,

3 B.V., 213 F.3d 841, 854 (5th Cir. 2000).

The standard for establishing personal jurisdiction in

diversity actions is well settled. A federal court sitting in

diversity may exercise personal jurisdiction only to the extent

permitted a state court under state law. Fielding v. Hubert Burda

Media, Inc., 415 F.3d 419, 424 (5th Cir. 2005). The court may only

exercise jurisdiction if: “(1) the state’s long-arm statute

applies, as interpreted by the state’s courts, and (2) if due

process is satisfied under the 14th Amendment to the federal

Constitution.” Allred v. Moore & Peterson, 117 F.3d 278 (5th Cir.

1997).

The first determination to be made is whether Mississippi’s

long-arm statute provides for the exercise of personal jurisdiction

over Wess-Del.1 “Under the tort prong of the Mississippi long-arm

statute, personal jurisdiction is proper if any element of the tort

(or any part of any element) takes place in Mississippi.” Allred,

117 F.3d at 282 (citing Smith v. Temco, 252 So. 2d 212, 216 (Miss.

1 Mississippi’s long-arm statute provides in relevant part that: “Any nonresident... corporation not qualified under the Constitution and laws of this state as to doing business herein, who shall make a contract with a resident of this state to be performed in whole or in part by any party in this state, or who shall commit a tort in whole or in part in this state against a resident or nonresident of this state, or who shall do any business or perform any character of work or service in this state, shall by such act or acts be deemed to be doing business in Mississippi and shall thereby be subjected to the jurisdiction of the courts of this state.” Miss. Code Ann. § 13-3-57.

4 1971); Western Chain Co. v. Brownlee, 317 So. 2d 418, 421 (Miss.

1975)). Under Mississippi law, causation by the defendant’s

product or injury within the state is sufficient to establish

jurisdiction over the defendant, regardless of whether the

defendant had the specific intent that its products be distributed

or used in Mississippi. Smith v. Temco, 252 So. 2d 212, 216 (Miss.

1971). Here, the injuries and damages allegedly caused by Wess-

Del’s products took place in the state of Mississippi. As a result,

Wess-Del is subject to jurisdiction under the Mississippi long-arm

statute.

The next determination that must be made is whether

jurisdiction over Wess-Del in this case comports with the due

process clause of the 14th Amendment. “Exercising personal

jurisdiction over a nonresident defendant is consistent with due

process when (1) defendant has purposefully availed himself of the

benefits and protections of the forum state by establishing minimum

contacts with the forum state, and (2) the exercise of jurisdiction

over that defendant does not offend traditional notions of fair

play and substantial justice.” Panda Brandywine Corp. v. Potomac

Elec. Power Co., 253 F.3d 865, 867 (5th Cir. 2001) (quoting Alpine

View Co. Ltd. v. Atlas Copco AB, 205 F.3d 208, 214 (5th Cir.

2000)).

Here, the appellants allege that Wess-Del satisfies prong one,

the minimum contacts test, under the stream of commerce theory

5 advanced by the Supreme Court in World-Wide Volkswagen Corp. v.

Woodson, 444 U.S. 286, 298 (1980)(“The forum State does not exceed

its powers under the Due Process Clause if it asserts personal

jurisdiction over a corporation that delivers its products into the

stream of commerce with the expectation that they will be purchased

by consumers in the forum State”). This Circuit’s decision in

Ruston Gas Turbines, Inc. v. Donaldson Co., Inc. is instructive.

In Ruston, a Minnesota manufacturer that conducted all its business

in Minnesota was sued in Texas courts. We held that defendants are

subject to specific jurisdiction in Texas courts in situations

where the defendant “not only could have foreseen that the products

might end up in Texas, it knew as a fact that the products were

going to be delivered to a specific user in Houston, Texas.”

Ruston Gas Turbines, Inc. v. Donaldson Co., Inc., 9 F.3d 415, 420

(5th Cir. 1993).

The appellants allege that Wess-Del knew that the beryllium-

containing products it sold to Boeing in California would be used

by Boeing at the Stennis Space Center in Mississippi. They also

allege that Stennis is the only place where these specific

beryllium-containing products could be used and that Wess-Del knew

this. In response to the appellants’ jurisdictional allegations,

Wess-Del submitted an affidavit from its Chief Financial Officer,

in which the CFO asserts that all of Wess-Del’s transactions with

Boeing took place entirely in California and that it conducts no

6 activity whatsoever in Mississippi. The district court relied

heavily on this affidavit in finding that Wess-Del lacked minimum

contacts with Mississippi. However, the assertions in the

affidavit do not contradict the appellants’ allegation that Wess-

Del knew that after it sold products to Boeing in California, those

products would be used by Boeing in Mississippi. Even if every

claim in the affidavit is completely true, Wess-Del could still

have known full well that the beryllium containing products it sold

to Boeing in California were intended to be used exclusively in

Mississippi. “When alleged jurisdictional facts are disputed, we

must resolve all conflicts in favor of the party seeking to invoke

the court's jurisdiction.” Ruston, 9 F.3d at 418. Thus, taking the

jurisdictional allegations of the appellants as true, the

appellants have presented a prima facie case for Wess-Del’s minimum

contacts in Mississippi, under the stream of commerce reasoning set

forth by the Supreme Court in World Wide Volkswagen.

The second prong of the due process analysis requires that

“the exercise of jurisdiction over that defendant does not offend

traditional notions of fair play and substantial justice.” Panda

Brandywine Corp, 253 F.3d at 867. In confronting this issue, a

court examines: (1) the defendant's burden; (2) the forum state's

interests; (3) the plaintiff's interest in convenient and effective

relief; (4) the judicial system's interest in efficient resolution

of controversies; and (5) the state's shared interest in furthering

7 fundamental social policies. Ruston, 9 F.3d at 421. Here, there

appears to be no reason why jurisdiction over Wess-Del in

Mississippi would run afoul of notions of fair play or substantial

justice. Mississippi has a substantial interest in protecting its

citizens from injuries from products used within its borders.

Furthermore, to extend jurisdiction over Wess-Del would efficiently

resolve the complaints of an entire class of appellants who allege

that they were harmed in Mississippi. Wess-Del offers no evidence

to support a contrary position. Since Wess-Del’s alleged actions

satisfy the Mississippi long-arm statute, the plaintiffs have

established a prima facie case that Wess-Del has minimum contacts

with Mississippi, and exercising jurisdiction over Wess-Del in

Mississippi would not offend notions of fair play and substantial

justice; the due process clause of the 14th amendment is not

violated by the exercise of jurisdiction in this case. For these

reasons, we reverse the district court’s grant of Wess-Del’s motion

to dismiss for lack of personal jurisdiction.

Medical Monitoring

This case presents the question of whether a medical

monitoring cause of action exists under Mississippi law. This is

an important question of state law which the Mississippi courts

have not as yet resolved. Therefore, the Fifth Circuit, on its

own motion, has determined that our proper course, in this

diversity jurisdiction case in which we are to apply the law of

8 the State of Mississippi, is to certify the central question in

this matter to the Supreme Court of Mississippi.

CERTIFICATE FROM THE UNITED STATES COURT OF APPEALS FOR THE

FIFTH CIRCUIT TO THE SUPREME COURT OF MISSISSIPPI, PURSUANT TO

THE MISSISSIPPI RULE OF APPELLATE PROCEDURE 20. TO THE SUPREME

COURT OF MISSISSIPPI AND THE HONORABLE JUSTICES THEREOF:

I. STYLE OF THE CASE

The style of the case in which this certificate is made is

George Paz, et al., Plaintiffs-Appellants v. Brush Engineered,

Materials, Inc., et al., Defendants-Appellees, Case No. 05-60157,

in the United States Court of Appeals for the Fifth Circuit, on

appeal from the United States District Court for the Southern

District of Mississippi. Federal jurisdiction is based on

diversity of citizenship.

II. STATEMENT OF THE CASE

The appellants filed a class action lawsuit alleging that

they were exposed to toxic beryllium dust at The Boeing Company

(“Boeing”) facilities at the Stennis Space Center in Mississippi

and at Canoga Park in California. According to the appellants,

exposure to airborne beryllium can cause Chronic Beryllium

Disease (“CBD”), an irreversible scarring of the lungs that can

9 lead to lung failure and death.2 However, initial symptoms of

the disease do not typically appear until many years after the

exposure. Early detection of the disease during its long latency

period can delay and diminish the debilitation caused by the

disease. However, many who have been exposed to beryllium and

are at risk for CBD never show any signs of the disease and

ultimately experience no ill-effects whatsoever from their

beryllium exposure.

The appellants seek the establishment of a court-supervised

medical monitoring fund that would pay for regular preventive

medical examinations of class members. The appellants do not

allege any present, physical tort injury in the conventional

sense. Nor do they claim that any class members presently have

CBD or that their exposure to beryllium has as yet caused

physical harm to any class member. Rather, the appellants claim

that, as a result of their being wrongfully exposed to beryllium,

ongoing diagnostic examinations are now a medical necessity for

them. The tort injury alleged is the cost to them of these

future examinations, not any present physical harm cause by the

The appellants filed their complaint in the Southern

District of Mississippi on June 30, 2004. The appellants jointly

2 Because this is a review of a 12(b)(6) dismissal, we must take such facts pleaded in the complaint as true. See Brown v. Nationsbank Corp., 188 F.3d 579, 586 (5th Cir. 1999).

10 moved to dismiss for failure to state a claim upon which relief

could be granted, pursuant to Rule of Federal Civil Procedure

12(b)(6). The district court concluded that the plaintiffs could

not maintain a claim for medical monitoring because such a cause

of action does not exist in Mississippi.

III. QUESTION CERTIFIED

Whether the laws of Mississippi allow for a medical

monitoring cause of action, whereby a plaintiff can recover

medical monitoring costs for exposure to a harmful substance

without proving current physical injuries from that exposure?

This Court disclaims any intention that the Supreme Court of

Mississippi confine its reply to the precise form or scope of the

legal question that we certify. If the Supreme Court of

Mississippi accepts this Certificate, the answers provided by

that court will determine the issue on appeal in this case. The

record in this case, together with the copies of the parties’

briefs, is transmitted herewith.

Conclusion

For the reasons stated above, the district court’s dismissal

of the appellants’ claims against We-Del for lack of personal

jurisdiction is REVERSED. Furthermore, this court has certified

the question regarding whether Mississippi has a medical

monitoring cause of action to the Mississippi Supreme Court.

Reversed in Part; Question Certified to the Supreme Court of

11 Mississippi.