United States District Court, E.D. Michigan, Southern Division
D. Borman District Judge.
REPORT AND RECOMMENDATION
STEVEN WHALEN UNITED STATES MAGISTRATE JUDGE.
the Court is a motion for dismissal filed by
Defendants/Cross-Defendants Beachmold Mexico, S. de R.L. de
C.V. (“Beachmold Mexico”), Plastic Injection
Operating Company of Mexico, LLC (“PIO”), and
Plastic Injection Holding Company of Mexico, LLC, n/k/a iP3
North America, LLC (“iP3”) [Doc. #102], which has
been referred for a Report and Recommendation under 28 U.S.C.
§ 636(b)(1)(B). Because the Court does not have personal
jurisdiction over these Defendants, I recommend that the
motion be GRANTED.
Grammer Industries, Inc., (“Plaintiff”) is a
South Carolina corporation, with its principal place of
business in Troy, Michigan, that supplies automotive
assemblies to automotive manufacturers. Defendant Beach Mold
and Tool, Inc. (“Beach Mold, Inc.”) is a
corporation located in Indiana that manufactures tooling and
parts that are molded from that tooling. In its Third Amended
Complaint (“TAC”)[Doc. #68], Plaintiff alleges
that it contacted Beach Mold, Inc. regarding a quote to build
tools, and for future consideration to build parts with those
tools, that Plaintiff would use in a potential contract with
a Fiat Chrysler, LLC (“FCA”) program. TAC, ¶
17. Plaintiff alleges that Beach Mold, Inc. issued a price
quotation to Grammer, providing that the tooling would be
built at Beach Mold's Indiana facility, and the parts
would be “manufactured at our Queretaro, Mexico
Facility.” Id. ¶ 18. Plaintiff also
contracted with Advance Mold Incorporated to manufacture a
fixture that would be used to produce parts at the Mexico
facility, and that fixture was delivered to Beach Mold.
Id. ¶ 21.
alleges that the purchase orders from Beach Mold, Inc.
“formed the Contract between Grammer and Beach
Mold.” Id. ¶ 25.
states that FCA placed the program on hold, and in 2015
requested proof of possession of the tooling; in turn,
Plaintiff requested the tooling from Beach Mold, Inc..
Id. ¶ 27. In response, Beach Mold, Inc.
informed Plaintiff “that the assets of the Mexico
Facility, including the Tooling, had been sold and/or
transferred to iP3 Mexico.” Id. ¶ 28.
Plaintiff claims that because Beach Mold, Inc. did not return
the tooling to it, or even provide evidence that it was
available for possession, Plaintiff had to reimburse FCA for
the tooling. Id. ¶ 29.
alleges that around August of 2012, “owners or
controlling interests common to Beach Mold and Beachmold
Mexico transferred interest in Beachmold Mexico to PIO and
PIH, ” Id. ¶ 34, and that upon
information and belief, “PIH n/k/a iP3 North America is
or was an inactive entity, and AIAC is the successor to
PIH.” Id. ¶ 35. Plaintiff alleges that
the assets of Beachmold Mexico (which would include the
tooling at issue) were sold, that the proceeds from the sale
“are or will be distributed to the owner members, PIO
and iP3, ” and that in turn, “such proceeds will
or have been distributed to the member of PIO and iP3 North
America, who upon information and belief, is
AIAC.”Id. ¶ 37.
brings a claim of breach of contract and conversion against
Beachmold Mexico, Id., Count III, and a claim of
breach of fiduciary duty and the Nevada Limited Liability
Companies Act against PIO and iP3, Id., Count IV. In
Count IV, Plaintiff more succinctly describes the
distribution of assets, including the tooling, as follows:
The assets of Beachmold Mexico were sold in 2016; Beachmold
Mexico, which no longer conducts business, distributed the
proceeds of the sale to PIO and iP3;, PIO and iP3 in turn
distributed the proceeds to AIAC. Id. ¶ ¶
STANDARD OF REVIEW
Rule of Civil Procedure 12(b)(2) provides for dismissal of a
complaint for lack of personal jurisdiction over a party, and
the party asserting the existence of personal jurisdiction
bears the burden of showing making at least a prima facie
showing of its existence. CompuServe, Inc. v.
Patterson, 89 F.3d 1257, 1261-1262 (6th Cir.1996);
Gould v. P.T. Krakatau Steel, 957 F.2d 573, 575 (8th
Cir.1992); Kerry Steel, Inc. v. Paragon Indust.,
Inc., 106 F.3d 147, 149 (6th Cir.1997). “Without
personal jurisdiction over an individual ... a court lacks
all jurisdiction to adjudicate that party's right,
whether or not the court has valid subject matter
jurisdiction.” Friedman v. Estate of Presser,
929 F.2d 1151, 1156 (6th Cir.1991).
subject to the jurisdiction of a court in the forum state,
the defendant must have sufficient minimum contacts with that
state that the action there “does not offend
traditional notions of fair play and substantial
justice.” Int'l Shoe Co. v. Washington,
326 U.S. 310, 316 (1945). See also Asahi Metal Industry
Co., Ltd. v. Superior Court of California, Solano
County, 480 U.S. 102, 108-09 (1987)(“The Due
Process Clause of the Fourteenth Amendment limits the power
of a state court to exert personal jurisdiction over a
nonresident defendant”); Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 474 (1985)(“‘[T]he
constitutional touchstone' of the determination whether
an exercise of personal jurisdiction comports with due
process ‘remains whether the defendant purposefully
established ‘minimum contacts' in the forum
State'”)(quoting International Shoe Co. v.
Washington, 326 U.S. 310, 316 (1945)).
Kerry Steel, Inc., 106 F.3d at149, the Court
described the two methods by which a federal court could
acquire personal jurisdiction over a defendant:
“Personal jurisdiction comes in two flavors:
‘general' jurisdiction, which depends on a showing
that the defendant has continuous and systematic contacts
with the forum state sufficient to justify the state's
exercise of judicial power with respect to any and all claims
the plaintiff may have against the defendant, and
‘specific' jurisdiction, which exposes the
defendant to suit in the forum state only on claims that
‘arise out of or relate to' a defendant's
contacts with the forum. Helicopteros Nacionales de
Colombia S.A., v. Hall, 466 U.S. 408, 414-415 & nn.
8-10, 104 S.Ct. 1868, 1872 & nn. 8-10, 80 L.Ed.2d 404
(1984); Th ...