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Kuhnmuench v. Livanova PLC

United States District Court, E.D. Michigan, Southern Division

November 15, 2017

PETER KUHNMUENCH and THERESA KUHNMUENCH, Plaintiffs,
v.
LIVANOVA PLC; LIVANOVA HOLDING USA, INC.; and LIVANOVA DEUTSCHLAND GMBH, Defendants.

          Stephanie Dawkins Davis United States Magistrate Judge.

          OPINION AND ORDER DENYING DEFENDANT LIVANOVA PLC'S MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION

          Paul D. Borman United States District Judge.

         This is a product-liability action brought by Plaintiffs Peter and Theresa Kuhnmuench against three related defendants: LivaNova PLC (“LivaNova”), LivaNova Holding USA, Inc. (“LivaNova USA”), and LivaNova Deutschland GmbH (“LivaNova Deutschland”). Before the Court is LivaNova's Motion to Dismiss for Lack of Personal Jurisdiction. (ECF No. 15.) For the reasons below, the Court will deny LivaNova's Motion.

         I. BACKGROUND

         A. Procedural History

         Each of the three Defendants in this action has proceeded differently in litigating this matter so far. As the instant Motion was filed by LivaNova alone, the following procedural history concerns that Defendant only.

         Plaintiffs filed their initial Complaint on May 31, 2017. (ECF No. 1, Compl.) The Complaint alleged that in the course of undergoing heart surgery in 2014, Plaintiff Peter Kuhnmuench suffered a severe infection as a result of bacteria that originated in a device used during the operation: the Sorin 3T Heater-Cooler System (“3T System”). (Compl. ¶¶ 40-59.) The Complaint further alleged that the 3T Heater-Cooler System was “designed, manufactured, marketed, and/or sold by” Defendants to the hospital at which the surgery was performed. (Compl. ¶¶ 17-30.) Invoking this Court's diversity jurisdiction, the Complaint asserted five claims: Negligence (Count I), Breach of Implied Warranty of Fitness (Count II), Breach of Express Warranty (Count III), Gross Negligence (Count IV), and a derivative Loss of Consortium claim asserted by Plaintiff Theresa Kuhnmuench, Peter's wife (Count V). (Compl. ¶¶ 60-86.)

         LivaNova moved to dismiss the original Complaint for lack of personal jurisdiction on July 24, 2017. (ECF No. 10.) Plaintiffs made two separate filings by way of a response on August 14, 2017: a response brief in opposition to LivaNova's motion (ECF No. 13), and an Amended Complaint (ECF No. 12, Am. Compl.). The Amended Complaint contained several new factual allegations concerning the manufacture of the 3T System as well as statements by LivaNova regarding the 3T System (Am. Compl. ¶¶ 18-28.), but was otherwise materially identical to the original Complaint. The Amended Complaint superseded the original Complaint and thus mooted LivaNova's motion to dismiss the original Complaint. See Calhoun v. Bergh, 769 F.3d 409, 410 (6th Cir. 2014) (“'An amended complaint supersedes an earlier complaint for all purposes.'”) (quoting In re Refrigerant Compressors Antitrust Litigation, 731 F.3d 586, 589 (6th Cir. 2013)).

         LivaNova filed a Motion to Dismiss the Amended Complaint for lack of personal jurisdiction on August 28, 2017 (ECF No. 15, LivaNova Mot.), and that Motion is presently before the Court. Plaintiffs filed a timely Response on September 18, 2017. (ECF No. 23, Pls.' Resp.) LivaNova filed a timely Reply on October 2, 2017. (ECF No. 27, LivaNova Reply.) This Court conducted a hearing on LivaNova's Motion on October 27, 2017.

         B. Jurisdictional Facts

         According to the sworn Declaration of Taylor Pollock, Vice President of Corporate Legal Affairs for LivaNova USA, LivaNova is a “public limited company” incorporated under the laws of England and Wales, and headquartered in London, United Kingdom. (ECF No. 10 Ex. 4, Declaration of Taylor Pollock ¶ 5.) The company was formed in February 2015 in order to facilitate the merger of Cyberonics, Inc., a Delaware corporation headquartered in Houston, Texas, and Sorin S.p.A., an Italian joint-stock company. According to LivaNova's most recent Form 10-K, filed with the United States Securities and Exchange Commission (“SEC”), LivaNova “became the holding company of the combined businesses of Cyberonics and Sorin . . . effective October 19, 2015.” (Pollock Decl. Ex. 1, 2016 SEC Form 10-K at 19, Pg ID 156; Pollock Decl. ¶¶ 1, 6.)

         Until the merger became effective in October 2015, Sorin S.p.A. was an Italian public company headquartered in Italy. LivaNova asserts that Sorin S.p.A., itself a holding company like its successor LivaNova, had never registered to transact business, maintained offices, employed registered agents or other employees, paid taxes, or rented or owned personal property in Michigan. LivaNova further asserts that Sorin S.p.A. never “manufactured, promoted, marketed, advertised, developed, designed, or sold any products, including the 3T Heater Cooler System at issue in this case, in Michigan, or anywhere else in the United States.” (Pollock Decl. ¶ 7.) These factual averments regarding Sorin S.p.A. are averred to be equally true of LivaNova. (Pollock Decl. ¶ 9.)

         Both before and after the 2015 merger, LivaNova USA's predecessor Sorin Group USA, Inc. (“Sorin USA”) conducted business in its own name in the United States. (Pollock Decl. ¶ 10.) Specifically, Sorin USA marketed and sold cardiopulmonary products, including the 3T System, in Michigan and elsewhere in the United States, and it was Sorin USA that sold the 3T System to the hospital referenced in the Amended Complaint. At all times relevant to the allegations in this lawsuit, Sorin USA communicated directly with customers (Pollock Decl. ¶ 11); bore profit and loss responsibilities for the sale and marketing of cardiopulmonary products (id. ¶ 15); employed approximately 350 sales, sales, service, management, manufacturing and administrative employees throughout the United States (id. ¶ 16); conducted business with third parties in its own name (id. ¶ 17); maintained independent control over the sale and distribution of its products, as well as spending and investment decisions (id. ¶¶ 18, 20); independently managed its own inventory; maintained its own business records at its headquarters in Colorado (id. ¶¶ 18, 21); and paid taxes and otherwise interacted with the United States government on its own behalf and in its own name (id. ¶¶ 19, 21). LivaNova asserts that during all times relevant to this lawsuit, LivaNova did not share any common officers or directors with Sorin USA, participate in Sorin USA's day-to-day business operations, or pay any of Sorin USA's employees. (Id. ¶¶ 12-13, 16.)

         Pursuant to a corporate reorganization effective July 21, 2017, Sorin USA changed its name to LivaNova Holding USA, Inc. (Id. ¶ 20.)

         ILLEGAL ...


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