On March 16, 2023, the New York Product Liability team and its Associate Brett J. Haroldson, prevailed on a motion to dismiss on behalf of an international electronics manufacturer in a $3.5 million product liability case.
The plaintiff, an Oklahoma-based commercial insurance company, filed claims in the U.S. District Court for the Eastern District of Michigan for negligence and strict products liability, alleging that a defective lightbulb the manufacturer designed caused a fire in its insured’s marijuana growing facility in Detroit. In addition to the bulb manufacturer, the plaintiff sued the U.S. based distributor, the retailer, and the ballast manufacturer.
Moving on behalf of the Chinese manufacturing company, Mr. Haroldson sought dismissal of all claims against it, arguing the court lacked personal jurisdiction under the Due Process Clause, as the company had no ties to the forum State of Michigan. The plaintiff opposed, not only contending the court had jurisdiction under a stream of commerce theory, but producing documentation that ostensibly linked the manufacturer to a U.S. wholesaler with an extensive domestic distribution network. This, the plaintiff maintained, satisfied the minimum contacts test for specific personal jurisdiction. In reply, Mr. Haroldson noted that, even if the two companies were linked, the plaintiff’s argument could only prevail under an alter-ego theory—in other words, that the two companies disregarded their distinct corporate identities and acted as one in order to perpetrate a fraud or a wrong. Because there was no evidence of that, the plaintiff’s complaint failed to articulate a basis for personal jurisdiction. The court agreed.
Ruling from the bench following in-person oral argument at the federal courthouse in Ann Arbor, the district judge found that the plaintiff came “nowhere close to establishing personal jurisdiction.”
The judge also denied the plaintiff’s request for limited discovery on the jurisdictional issue, noting the dearth of factual support connecting the company to Michigan or the U.S. wholesaler. This successful outcome results from the outstanding strategy, support, and tireless efforts of the entire New York Product Liability team, especially team leader Gregg Minkin, Partner Joseph T. Rivera, Jr., and paralegal Frances Pena, as well as several members of the firm's Detroit office, particularly Senior Counsel Cara Swindlehurst.
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