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Magna Closures Inc. v. Superior Court (Salvador Garcia Rodriguez)

California Court of Appeals, Sixth District
Sep 27, 2010
No. H034766 (Cal. Ct. App. Sep. 27, 2010)

Opinion


MAGNA CLOSURES INC., Petitioner, v. THE SUPERIOR COURT OF MONTEREY COUNTY, Respondent SALVADOR GARCIA RODRIGUEZ et al. Real Parties in Interest. H034766 California Court of Appeal, Sixth District September 27, 2010

NOT TO BE PUBLISHED

Monterey County Super. Ct. No. M90458.

Mihara, J.

Plaintiffs and real parties in interest are the survivors of Belia Garcia Rodriguez and Sebastian Cruz Topete who died after a car accident. Plaintiffs filed a wrongful death action against defendants Ford Motor Company (Ford), Magna Donnelly Corporation, Magna Closures, Inc. and Frank’s Auto Sales. Magna Closures made a special appearance and brought a motion to quash service of summons on the ground that it did not have sufficient contact with California to support the assertion of personal jurisdiction. The trial court denied the motion. Magna Closures filed a petition for writ of mandate or prohibition in this court. Magna Closures seeks an order directing the trial court to vacate its order denying the motion to quash service of summons. Plaintiffs filed preliminary opposition and Magna Closures filed a reply. We subsequently issued an order to show cause. Plaintiffs elected to treat their preliminary opposition as a written return and there has been no further briefing. We conclude that the trial court improperly exercised jurisdiction over Magna Closures. We therefore grant the petition for writ of mandate directing respondent Monterey County Superior Court to vacate the September 1, 2009 order denying the motion to quash service of summons.

Plaintiffs are Salvador Garcia Rodriguez, individually and as successor in interest to the estate of Belia Garcia Rodriguez, and as guardian ad litem of Luis Fernando Garcia, Luz Elena Garcia Diaz, Alejandra Garcia Topete, and Daniel Salvador Garcia Topete, and Lolita Koteen Rodriguez, individually and as successor in interest to the estate of Sebastian Cruz Topete, and as guardian ad litem of Reina Cruz and Sebastian Rodriguez, Jr.

I. Factual and Procedural Background

On January 30, 2007, Topete was driving a 1999 Lincoln Navigator in Mexico. Rodriguez was a passenger in the vehicle. When Topete lost control of the vehicle, it veered off the road, rolled over more than once, and landed on its roof. As a result, Topete and Rodriguez sustained serious injuries that eventually resulted in death.

In October 2008, plaintiffs filed their first amended complaint for damages for wrongful death. Plaintiffs alleged, among other things, that the vehicle’s “doors, door latches, door handles, door retention system, glazing, roof structure, and other components... failed to perform adequately” during the accident. They also alleged that Magna Closures and Magna Donnelly Corporation designed, manufactured, marketed, and sold the components of the vehicle’s doors.

In November 2008, Magna Closures made a special appearance and filed a motion to quash service on the ground that the trial court lacked personal jurisdiction. In support of its motion to quash service, Magna Closures submitted the declaration of William Snider, Magna Closures’ director of finance. According to Snider, Magna Closures is an Ontario corporation with its principal place of business in Ontario, Canada. Magna Closures designed and manufactured the Navigator’s door latching system and sold it to Ford, which incorporated it into the vehicle. All latching systems designed and manufactured by Magna Closures for the 1999 Lincoln Navigator were fabricated and sold outside California. Between 2003 and 2007, Magna Closures did not sell any products to customers, maintain a registered agent for service of summons, maintain a place of business, or employ anyone in California. The company did not advertise, solicit business, or own, lease, or control any real or personal property in California. Nor did Magna Closures have any post office boxes, bank accounts, telephone or fax numbers, or other tangible assets in California.

In addition, Snider stated that Magna Mirrors of America, Inc. (Magna Mirrors), also known as Magna Donnelly Corporation, is incorporated and has its principal place of business in Michigan. Magna Closures is neither a parent nor a subsidiary of Magna Mirrors. The two companies maintain separate assets, employees, operations, records, and management.

In response to Magna Closures’ motion, plaintiffs submitted several exhibits. Exhibit 1 is Magna International, Inc.’s 2009 Web site on which Magna Closures stated: “Magna Closures is a leading full service supplier of innovative closure systems and modules to the global automotive industry” and that its “product expertise includes door modules, window systems, power closure systems, latching systems, handle assemblies, driver controls and obstacle detection systems.” Exhibit 3 is the same 2009 Web site on which Magna Closures listed its customers, including BMW, Ford, General Motors, Honda, Mitsubishi, and Renault-Nissan. Exhibit 5 is Honda’s Web site. It states that Honda’s sales and marketing headquarters is located in Torrance, California, and Honda has three parts centers, one testing facility, an education center, a styling center, a performance development center, and two research and development facilities in California. However, Honda does not have any manufacturing plants in California. Exhibit 7 is a November 2005 press release by Nissan North America, Inc. in which it announced the relocation of its headquarters from California to Tennessee. Exhibit 9 is Mitsubishi’s Web site, which states that the company has corporate headquarters in California.

Plaintiffs’ attorney submitted a declaration stating that exhibit 6 is Magna Closure’s “CA contact list” for several different automobile companies. As discussed below, exhibit 6 refers to Magna Mirrors’ contact list.

Plaintiffs also submitted exhibit 2, which consists of Magna Closures’ responses to plaintiffs’ special interrogatories. Magna Closures stated that it shipped product to approximately 43 entities located in California, and it would produce the identity of these entities only under protective order. The sales of these products were made outside California to a Ford-related entity. Magna Closures also stated that “it [did] not know” the number of new vehicles for which it “provided component parts that have been sold in California since January 1, 1997.”

Magna Closures filed a reply to plaintiffs’ response to its motion to quash. Exhibit A-1 listed the manufacturers to whom Magna Closures sold products between 2005 and 2007. This list was produced in discovery by stipulation with plaintiffs’ counsel. BMW, Mitsubishi, and Renault-Nissan were not included on this list. Though Magna Closures sold products to Nissan Motor Manufacturing Corporation between 2005 and 2007, it did not sell products to Nissan North America, Inc. Exhibit A-4 established that the Navigator at issue in this case was built in Michigan by Ford and sold by Ford in Texas. Five years later, the Navigator, which had over 100, 000 miles on the odometer, entered California as a used vehicle.

Magna Closures’ exhibit A-4 outlined the history of the vehicle at issue in this case. In October 1998, Ford issued a certificate of origin for the vehicle in Dearborn, Michigan. The vehicle was then transferred to a dealer in Texas, which sold it to Gecal Corporation in Illinois. In May 2002, Gecal sold the vehicle to Frank and Sandra Verra in Texas. At that time, there 64, 157 miles on the odometer. The California Department of Motor Vehicles registration information first refers to this vehicle on December 9, 2003, which appears next to the notation “Odometer: 103, 763 actual mileage.”

Magna Closures also submitted the declaration of Cynthia Mullins, the assistant controller of Dortec Industries, which is one of the business name registrations of Magna Closures. According to Mullins, Magna Closures made no sales to anyone in California between 2005 and 2007. During that same period, Magna Closures had no distributor, supplier, or retailer that sold Magna Closures’ products in or to California. Magna Closures did, however, sell in Canada to Ford from 2005 to 2007 “a small quantity” of replacements parts that Ford requested be shipped to dealers in California.

Following a hearing, the trial court denied the motion to quash service of summons. The trial court noted that Magna Closures was a leading supplier of closure systems and summarized its contacts with California. “Magna Closures supplies parts to automakers BMW, Honda, Mitsubishi, and Renault-Nissan. These customers have major facilities in California.... Magna Closures shipped products to Honda in California. Magna Closures... has a ‘CA contact list’ for a number of different automobile companies.... [¶] [Magna Closures] shipped product to approximately 43 entities located in the State of California.... The sales... were made outside California to a Ford Motor Company-related entity....” The trial court also observed that Magna Closures did not know “ ‘the number of new vehicles for which [it had] provided component parts that have been sold in California since January 1997.’ ” Based on these contacts, the trial court concluded that Magna Closures was subject to specific jurisdiction in California.

II. Discussion

When a nonresident defendant challenges jurisdiction, it is the plaintiff’s burden to establish facts that would “justify[] the exercise of jurisdiction.” (Vons Companies, Inc. v. Seabest Foods, Inc. (1996) 14 Cal.4th 434, 449 (Vons).) After the plaintiff has met the burden of showing minimum contacts with the forum state, the defendant must show that the exercise of jurisdiction would be unreasonable. (Ibid.)

On appeal, the trial court’s factual findings are binding if they are supported by substantial evidence. (Vons, supra, 14 Cal.4th at p. 449.) When the facts are undisputed, we review independently the trial court’s legal conclusions. (Ibid.)

We first consider Magna Closures’ contention that there was insufficient evidence to support some of the trial court’s factual findings regarding Magna Closures’ contacts with California.

Magna Closures challenges the trial court’s finding that it “supplies parts” to BMW, Honda, Mitsubishi, and Renault-Nissan and “these companies have major facilities in California.” The evidence to support this finding was from a 2009 Web site. However, courts examine a defendant’s jurisdictional contacts with the forum state at the time the cause of action arose. (Cadle Co. II, Inc. v. Fiscus (2008) 163 Cal.App.4th 1232, 1239.) Here, the cause of action arose in 2007. The evidence was uncontradicted that Magna Closures did not supply parts to BMW, Mitsubishi, and Renault-Nissan in 2007. Accordingly, there was insufficient evidence to support this finding.

Though Magna Closures sold products to Nissan Motor Manufacturing Corporation in 2007, it did not sell products to Nissan North America, Inc.

The trial court also found that Magna Closures shipped products to Honda in California. Though Magna Closures acknowledged that Honda was one of its customers and that it shipped component parts to Honda production facilities in Ohio, there was no evidence that Magna Closures shipped such products to Honda in California. Both Snider and Mullins stated that Magna Closures did not sell any products to anyone in California during the relevant time period. These declarations were corroborated by plaintiffs’ evidence that Honda did not have production facilities in California. Thus, there was insufficient evidence to support the finding that Magna Closures shipped parts to Honda in California.

Magna Closures next disputes the trial court’s finding that it had a “ ‘CA contact list’ for a number of different automobile companies.” This finding was based on plaintiffs’ exhibit 6. However, these documents referred to Magna Mirrors, not Magna Closures. The Bates stamp in the lower right-hand corner was “MMAI” for Magna Mirrors of America, Inc. Magna Closures’ documents were Bates-stamped “MCI” for Magna Closures, Inc. Moreover, three of the five pages in exhibit 6 contained the name and logo of Magna Donnelly, which was also known as Magna Mirrors. Magna Closures was neither a parent nor a subsidiary of Magna Mirrors, and the two companies maintained separate assets, employees, operations, records, and management. Thus, there was insufficient evidence to support the finding that Magna Closures had a “ ‘CA contact list.’ ”

Relying on Yield Dynamics, Inc. v. TEA Systems Corp. (2007) 154 Cal.App.4th 547, plaintiffs contend that Magna Closures forfeited the issue because it failed to challenge this evidence before the trial court. Yield is inapposite. In Yield, the appellant argued that the trial court had erred by failing to conduct a hearing on a sanctions motion. (Id. at p. 584.) The reviewing court held that the appellant had waived the issue on appeal because he failed to object below. (Ibid.) In the present case, both Magna Mirrors and Magna Closures challenged personal jurisdiction, and the trial court heard their motions at the same hearing. At that time, counsel for Magna Closure pointed out that the evidence regarding Magna Closures’ contacts with California differed from those of Magna Mirrors. Thus, the issue has not been waived.

However, the trial court also found that Magna Closures sold its product outside California to approximately 43 Ford-related entities and shipped the product to entities in California at the request of the non-California Ford-related entity. Thus, we turn now to the question of whether this finding supports the trial court’s exercise of personal jurisdiction over Magna Closures.

California courts “may exercise jurisdiction on any basis not inconsistent with the Constitution of this state or of the United States.” (Code Civ. Proc., § 410.10.) This statute “manifests an intent to exercise the broadest possible jurisdiction, limited only by constitutional considerations” of due process. (Sibley v. Superior Court (1976) 16 Cal.3d 442, 445.) In accordance with these due process considerations, a court may exercise personal jurisdiction over a non-resident defendant when the defendant has “certain minimum contacts... such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’ ” (International Shoe Co. v. Washington (1945) 326 U.S. 310, 316, citations omitted; Cornelison v. Chaney (1976) 16 Cal.3d 143, 147.)

“ ‘The concept of minimum contacts... requires the states to observe certain territorial limits on their sovereignty. It “ensure[s] that the States, through their courts, do not reach out beyond the limits imposed on them by their status as coequal sovereigns in a federal system.” ’ [Citations.] To do so, the minimum contacts test asks ‘whether the “quality and nature” of the defendant’s activity is such that it is “reasonable” and “fair” to require him to conduct his defense in that State.’ [Citations.] The test ‘is not susceptible of mechanical application; rather, the facts of each case must be weighed to determine whether the requisite “affiliating circumstances” are present.’ [Citation.]” (Snowney v. Harrah’s Entertainment, Inc. (2005) 35 Cal.4th 1054, 1061 (Snowney).) There are two types of jurisdiction under the minimum contacts test: general and specific. (Pavlovich v. Superior Court (2002) 29 Cal.4th 262, 268-269 (Pavlovich).) Since plaintiffs do not claim general jurisdiction, the only issue in the present case is whether the trial court properly exercised specific jurisdiction.

Plaintiffs argue that California courts have specific jurisdiction over Magna Closures because Magna Closures placed its product into the stream of commerce knowing that the product would be used in California.

A court considers the “ ‘relationship among the defendant, the forum, and the litigation’ ” in determining whether there is specific jurisdiction. (Helicopteros Nacionales de Colombia v. Hall (1984) 466 U.S. 408, 414, quoting Shaffer v. Heitner (1977) 433 U.S. 186, 204.) California courts have specific jurisdiction over a nonresident defendant if “(1) ‘the defendant has purposefully availed himself or herself of forum benefits’ [citation]; (2) ‘the “controversy is related to or ‘arises out of’ [the] defendant’s contacts with the forum” ’ [citations]; and (3) ‘ “the assertion of personal jurisdiction would comport with ‘fair play and substantial justice.’ ” ’ [Citations.]” (Pavlovich, supra, 29 Cal.4th at p. 269.)

World-Wide Volkswagen Corp. v. Woodson (1980) 444 U.S. 286 (World-Wide Volkswagen) is instructive. In that case, the plaintiffs, who were New York residents, purchased a vehicle from a New York retailer. (Id. at p. 288.) After they were injured in an accident in Oklahoma, the plaintiffs filed an action in that state against the manufacturer, the importer, the regional distributor, and the retail dealer, alleging that the accident was caused by the vehicle’s defective design. (Ibid.) The regional distributor’s market was limited to dealers in New York, New Jersey, and Connecticut, and the retailer dealer’s sales were made in New York. (Ibid.) These corporations did not do business in Oklahoma, ship or sell products to that state, have an agent to receive process there, or advertise in Oklahoma. (Id. at p. 289.) The United States Supreme Court held that the Oklahoma court did not have personal jurisdiction over either the regional distributor or the retail dealer, because they had “ ‘no contacts, ties, or relations’ ” with that state. (Id. at p. 299.)

In dicta, World-Wide Volkswagen discussed the purposeful availment element of the stream of commerce theory in connection with the international manufacturer and the importer of the vehicle, neither of which challenged personal jurisdiction. (World-Wide Volkswagen, supra, 444 U.S. at p. 288, fn. 3.) The court stated that “the foreseeability that is critical to due process analysis is not the mere likelihood that a product will find its way into the forum State. Rather, it is that the defendant’s conduct and connection with the forum State are such that he should reasonably anticipate being haled into court there.” (Id. at p. 297.) The court also observed: “When a corporation ‘purposefully avails itself of the privilege of conducting activities with the forum State, ’ [citation], it has clear notice that it is subject to suit there, and can act to alleviate the risk of burdensome litigation by procuring insurance, passing the expected costs on to customers, or, if the risks are too great, severing its connection with the State. Hence if the sale of a product of a manufacturer or distributor... is not simply an isolated occurrence, but arises from the efforts of the manufacturer or distributor to serve, directly or indirectly, the market for its product in other States, it is not unreasonable to subject it to suit in one of those States if its allegedly defective merchandise has there been the source of injury to its owner or to others. 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. [Citation.]” (Id. at pp. 297-298.)

Asahi Metal Industry Co. v. Superior Court (1987) 480 U.S. 102 (Asahi) revisited the purposeful availment element. In Asahi, when the plaintiff lost control of his motorcycle in California, he was injured and his wife was killed. (Id. at pp. 105-106.) The plaintiff then filed a products liability lawsuit in California against the Taiwanese tube manufacturer and alleged that the accident was caused by defects in the motorcycle tire, tube, and sealant. (Asahi, at p. 106.) The tube manufacturer filed a cross-complaint seeking indemnification from, among others, Asahi, which was the Japanese manufacturer of the tube’s valve assembly. (Ibid.) After the plaintiff settled with the tube manufacturer and the other defendants, the only remaining claim was the Taiwanese tube manufacturer’s indemnity claim against Asahi. (Ibid.) Asahi moved to quash the tube manufacturer’s service of summons on the ground that California’s exercise of personal jurisdiction over it violated the due process clause of the Fourteenth Amendment. (Ibid.)

The Asahi court expressed differing views on the stream of commerce theory. Justice O’Connor, joined by three justices, concluded that the “placement of a product into the stream of commerce, without more, is not an act of the defendant purposefully directed toward the forum State.” (Asahi, supra, 480 U.S. at p. 112.) Instead, purposeful availment requires “[a]dditional conduct of the defendant” indicating “an intent or purpose to serve the market in the forum State.” (Ibid.) Such examples would include “designing the product for the market in the forum State, advertising in the forum State, establishing channels for providing regular advice to customers in the forum State, or marketing the product through a distributor who has agreed to serve as the sales agent in the forum State.” (Ibid.) This approach is sometimes referred to as the “ ‘stream-of-commerce-plus’ ” test. (Carretti v. Italpast (2002) 101 Cal.App.4th 1236, 1248 (Carretti).) In contrast to this view, Justice Brennan and three concurring justices observed that the “stream of commerce refers... to the regular and anticipated flow of products from manufacture to distribution to retail sale” and that “[a]s long as a participant in this process is aware that the final product is being marketed in the forum State, the possibility of a lawsuit there cannot come as a surprise.” (Asahi, at p. 117.) Justice Brennan reasoned that a “defendant who has placed goods in the stream of commerce benefits economically from the retail sale of the final product in the forum State, and indirectly benefits from the State’s laws that regulate and facilitate commercial activity. These benefits accrue regardless of whether that participant directly conducts business in the forum State, or engages in additional conduct directed toward that State.” (Ibid.) Eight justices, however, held that the third element, that is, whether the exercise of personal jurisdiction “would offend ‘ “traditional notions of fair play and substantial justice” ’ [citations], ” had not been met. (Asahi, at p. 113.) In reaching this conclusion, the court reasoned: “Considering the international context, the heavy burden on the alien defendant, and the slight interests of the plaintiff and the forum State, the exercise of personal jurisdiction by a California court over Asahi in this instance would be unreasonable and unfair.” (Asahi, at p. 116.)

Justice Stevens, joined by two justices who had concurred in Justice Brennan’s opinion, concurred in part and in the judgment. Justice Stevens explained that he did not join Justice O’Connor’s opinion on two grounds. First, there was “no reason... to articulate ‘purposeful direction’ or any other test” because the reasonableness element had not been met. (Asahi, supra, 480 U.S. at pp. 121-122.) Second, even assuming this test was appropriate, the plurality misapplied it to the facts of Asahi. (Id. at p. 122.)

The California Supreme Court has not ruled directly on the divergent views expressed in Asahi. However, two cases suggest that the stream-of-commerce-plus test is the appropriate standard in evaluating minimum contacts. In Pavlovich, supra, 29 Cal.4th 262, a trade association that administered DVD licensing brought a misappropriation of trade secrets lawsuit against a Texas Web site operator who, while living in Indiana, posted the source code that could circumvent DVD encryption. (Id. at pp. 266-267.) The trade association argued that jurisdiction was proper in California because the Web site operator knew that his conduct would adversely affect the state’s computer, motion picture, and consumer electronics industries. (Id. at p. 267.) In applying the effects test, which is applicable to intentional tort claims against a nonresident defendant, Pavlovich concluded that the purposeful availment element required not only foreseeability of harm in California but also evidence of express aiming or targeting of tortious conduct at this state. (Id. at pp. 269-274.) In reaching its holding, Pavlovich analogized to the stream of commerce theory in the product liability field, observing that “ ‘ “[c]reating a site, like placing a product into the stream of commerce, may be felt nationwide-or even worldwide-but, without more, it is not an act purposefully directed toward the forum state. [Citations.]” ’ ” (Id. at p. 274.) Pavlovich also cited Justice O’Connor’s plurality opinion as support for the proposition that “the foreseeability that third parties may use DeCSS to harm the motion picture industry cannot, by itself, satisfy the express aiming requirement.” (Id. at p. 276.)

Snowney, supra, 35 Cal.4th 1054 also examined the purposeful availment element in another context. In Snowney, a California resident brought a class action against several Nevada hotel operators for deceptive billing. (Id. at p. 1059.) The hotels advertised in California and California residents constituted a significant portion of their business, but they did not conduct business and had no bank accounts in the state. (Ibid.) Snowney held that the hotels’ solicitation of business from California residents through their Web site and other advertising satisfied the purposeful availment element. (Id. at pp. 1062-1065.) Snowney also noted that its “finding of purposeful availment... relies on defendants’ purposeful and successful solicitation of business within California-and not on the mere foreseeability that California residents will patronize businesses of a neighboring state.” (Id. at p. 1067, fn. 6.)

The Second District Court of Appeal adopted the stream-of-commerce-plus test in Felix v. Bomoro Kommanditgesellschaft (1987) 196 Cal.App.3d 106 (Felix). In Felix, the plaintiff’s daughter died in a car accident, and the plaintiff brought a products liability action against, among others, Bomoro, which was the German manufacturer that supplied the allegedly defective door latch assembly to Volkswagen in Germany. (Id. at p. 109.) Bomoro then brought a motion to quash service of summons for lack of personal jurisdiction, which the trial court granted. (Id. at pp. 109-110.)

Felix concluded that “the strictures of the due process clause forbid a court from exercising personal jurisdiction over a foreign corporation that merely places its products into the stream of commerce even though it may foresee that those products will ultimately wind their way into the forum state. While not wholly irrelevant, foreseeability alone has never been a sufficient benchmark for personal jurisdiction under the Fourteenth Amendment. [Citation.]” (Felix, supra, 196 Cal.App.3d at pp. 114-115.) As Felix explained, “[i]n today’s rapidly shrinking commercial world with its increasing emphasis on integrated and interdependent goods, it is of course possible for a foreign manufacturer of component parts to reasonably expect that the stream of distribution will carry its products into each of the 50 states and, indeed, around the world. The ‘contact’ proximately resulting from such a commonly held expectation, however, fails to create a substantial connection between the defendant corporation and the forum state. [Citations.]... Individuals and corporations alike must be given fair notice about which activities will make them amenable to suit in a state forum. If foreseeability alone were the criterion, sellers of goods would confront widened bases of personal jurisdiction inconsistent with principles of fair play and substantial justice.” (Id. at p. 115.) Applying the stream-of-commerce-plus test, Felix affirmed the order granting the motion to quash service of summons. (Id. at pp. 116-117.) We agree with Felix that “[t]he appropriate test is not knowledge or awareness of the ultimate destination of the product, but whether the manufacturer has purposefully engaged in forum activities so it can reasonably expect to be haled into court there....” (Id. at p. 117.)

Other appellate courts have acknowledged the stream-of-commerce-plus test. (See West Corp. v. Superior Court (2004) 116 Cal.App.4th 1167, 1173-1174 [mere foreseeability of telemarketer’s product entering California does not support jurisdiction]; Carretti, supra, 101 Cal.App.4th at p. 1253 [court lacked jurisdiction over Italian corporation that sold its product in Italy to a distributor who maintained an office in California].)

The facts in Felix are almost identical to those in the present case. In both cases, the defendant was a foreign corporation that manufactured door latch systems which were then sold to automobile companies outside California. Neither defendant was licensed to do business in California. Nor did either defendant have any office, agent, employee, bank account, or business operation in this state. In both cases, though the automobile companies sold the finished product in California, neither defendant “advertised, solicited any business, or otherwise sought to serve any particular market in this state.” (Felix, supra, 196 Cal.App.3d at p. 116.) Moreover, neither defendant had any control over where its door latching system would be sold. Though consumers could purchase Bomoro parts through Volkswagen dealerships in California, Felix concluded that this “fact alone [was] insufficient to justify the exercise of jurisdiction where the cause of action bears no relationship whatsoever to such sales. [Citations.]” (Id. at pp. 110, fn. 4, 116-117.) Similarly, here, Magna Closures sold to Ford in Canada “a small quantity” of replacement parts that Ford requested be shipped to 43 of its dealers in California. Thus, it was Ford, not Magna Closures, that determined where these parts would be sold. As in Felix, no showing was made that the products involved in these transactions were in any way related to Magna Closures’ door latching systems. Magna Closures also manufactured window systems, driver controls and obstacle detection systems. Thus, here, plaintiffs failed to carry their burden to show that the present controversy is related to or arose out of these contacts. Under Felix, “it [is] clear that the extent to which [Magna Closures] could reasonably anticipate being involved in litigation in California was minimal at best.” (Id. at p. 117.)

Plaintiffs, however, rely on Bridgestone Corp. v. Superior Court (2002) 99 Cal.App.4th 767 (Bridgestone). In that case, Bridgestone, a Japanese tire manufacturer, delivered 25, 000 tires per month to Firestone’s distribution center in California. (Id. at p. 772.) Firestone, in turn, distributed the tires to 850 to 900 Firestone dealers, and about half of these dealers were in California. (Ibid.) In addition, several Bridgestone employees visited the Firestone distribution center while Firestone’s manager visited Bridgestone in Japan several times. (Ibid.) Bridgestone concluded that “a manufacturer’s placement of goods in the stream of commerce with the expectation that they will be purchased or used by consumers in California indicates an intention to serve the California market ‘directly or indirectly’ [citation] and constitutes purposeful availment if the income earned by the manufacturer from sale or use of its product in California is substantial. [Citations.]” (Id. at p. 777.) Bridgestone is factually distinguishable from the present case. Here, in contrast to Bridgestone’s monthly shipments of 25, 000 tires to California, Magna Closures shipped “a small quantity” of replacement parts to 43 dealers in California between 2005 and 2007.

In Bridgestone, the Second District Court of Appeal acknowledged the split on the purposeful availment issue in Asahi. (Bridgestone, supra, 99 Cal.App.4th at p. 776.) However, it did not mention its prior decision in Felix.

Plaintiffs also rely on In re Automobile Antitrust Cases I & II (2005) 135 Cal.App.4th 100. In that case, the plaintiffs brought an antitrust class action in which they alleged that various automobile manufacturers, distributors, and trade associations engaged in an illegal conspiracy to prevent the export of Canadian motor vehicles to California, thereby ensuring that the defendants would not face price competition from Canadian distributors, who sold essentially the same vehicle for a lower price. (Id. at pp. 105-106.) The three nonresident parent manufacturers, Honda, Volkswagen, and Nissan, moved to quash service of summons for lack of personal jurisdiction, which the trial court granted. (Id. at p. 107.) In discussing the purposeful availment element of the stream of commerce theory, the First District Court of Appeal rejected the plurality opinion in Asahi Metal as dicta. (Id. at p. 115, fn. 6.) The court then stated that the purposeful availment element is satisfied “if the defendant purposefully and voluntarily directs its acts toward the forum so that it should expect, because of the benefits it receives, to be subject to the court’s jurisdiction based on its forum contacts. [Citations.]” (Id. at p. 115.) In response to the parent manufacturers’ argument that they did not sell motor vehicles in California, their American subsidiaries did so, the court, citing Bridgestone, stated that “an indirect effort to serve a California market... may reasonably make that manufacturer subject to suit in California.” (Ibid.) The court also rejected the manufacturers’ argument that this contact was “too attenuated, ” stating that there could be “little doubt that sales of these three parent manufacturers’ motor vehicles in California-the sixth largest motor vehicle market in the world-result in significant earnings for these three nonresident defendants. [Citations.]” (Id. at p. 116.) However, the court held that the California court lacked specific jurisdiction over the manufacturers because the plaintiffs failed to present any evidence that these defendants were involved in the alleged conspiracy. (Id. at pp. 118-119.) Thus, the court’s discussion of purposeful availment was dicta.

In sum, we conclude that plaintiffs failed to meet their burden of showing that Magna Closures purposefully engaged in activities that would have led it to reasonably expect to defend an action in California. Accordingly, the trial court lacked specific jurisdiction over Magna Closures.

III. Disposition

Let a peremptory writ of mandate issue directing respondent court to vacate its order denying the motion to quash service of summons and to enter a new order granting the motion. The temporary stay order issued November 10, 2009, is vacated.

WE CONCUR: Bamattre-Manoukian, Acting P. J., McAdams, J.


Summaries of

Magna Closures Inc. v. Superior Court (Salvador Garcia Rodriguez)

California Court of Appeals, Sixth District
Sep 27, 2010
No. H034766 (Cal. Ct. App. Sep. 27, 2010)
Case details for

Magna Closures Inc. v. Superior Court (Salvador Garcia Rodriguez)

Case Details

Full title:MAGNA CLOSURES INC., Petitioner, v. THE SUPERIOR COURT OF MONTEREY COUNTY…

Court:California Court of Appeals, Sixth District

Date published: Sep 27, 2010

Citations

No. H034766 (Cal. Ct. App. Sep. 27, 2010)