GCIU-Employer Retirement Fund v. Coleridge Fine Arts ( 2020 )

FILED
United States Court of Appeals
UNITED STATES COURT OF APPEALS Tenth Circuit
FOR THE TENTH CIRCUIT April 6, 2020
_________________________________
Christopher M. Wolpert
Clerk of Court
GCIU-EMPLOYER RETIREMENT
FUND; BOARD OF TRUSTEES OF THE
GCUI-EMPLOYER RETIREMENT
FUND,
Plaintiffs - Appellants,
No. 19-3161
v. (D.C. No. 2:14-CV-02303-EFM-KGG)
(D. Kan.)
COLERIDGE FINE ARTS; JELNIKI
LIMITED,
Defendants - Appellees.
_________________________________
ORDER AND JUDGMENT *
_________________________________
Before BRISCOE, LUCERO, and McHUGH, Circuit Judges.
_________________________________
This is the second time this case has been before this court. In each instance, a
dismissal for lack of personal jurisdiction was at issue. In this appeal, Plaintiffs
GCIU-Employer Retirement Fund and the Board of Trustees of the GCIU-Employer
Retirement Fund (collectively the “Fund”) appeal from a second order dismissing
their action against Defendants Coleridge Fine Arts (“Coleridge”) and Jelniki
Limited (“Jelniki”). The Fund alleges that Coleridge and Jelniki are jointly and
*
This order and judgment is not binding precedent, except under the doctrines
of law of the case, res judicata, and collateral estoppel. It may be cited, however, for
its persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
severally liable for certain pension payments under the Employee Retirement Income
Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq., as amended by the
Multiemployer Pension Plan Amendments Act of 1980 (“MPPAA”). Id. §§ 1381–
1461. Before reaching any issue of potential liability, the district court first had to
determine whether Coleridge and Jelniki – both foreign corporations with controlling
interests in an American company called Greystone Graphics, Inc. (“Greystone”) –
are subject to personal jurisdiction in the United States. The district court concluded
personal jurisdiction was not established and granted a motion to dismiss. In the
prior appeal, we agreed that the facts then presented did not support the exercise of
personal jurisdiction over Coleridge and Jelniki, but we reversed and remanded for
jurisdictional discovery. GCIU-Emp’r Ret. Fund v. Coleridge Fine Arts, 700 F.
App’x 865, 867–71 (10th Cir. 2017) (unpublished).
On remand, after the parties conducted further discovery, Coleridge and Jelniki
again moved to dismiss on jurisdictional grounds. The district court granted the
motion, concluding the additional evidence generated by the Fund did not establish
that (1) Coleridge and Jelniki were involved in Greystone’s day-to-day operations; or
(2) the Fund’s claims arose out of or related to Coleridge’s and Jelniki’s contacts
with the United States. We affirm the district court’s second dismissal for a lack of
personal jurisdiction. We conclude that the Fund did not make a prima facie showing
of purposefully-directed activities by Coleridge and Jelniki in connection with
Greystone’s withdrawal from the pension fund. We also conclude that the Fund
forfeited any argument its injuries arose out of Coleridge’s and Jelniki’s alleged
2
contacts with the United States. Given these conclusions, we need not proceed to
also consider whether exercising personal jurisdiction over Coleridge and Jelniki
would be consistent with fair play and substantial justice.
I
Multi-employer pension plans are regulated by ERISA, with the goal of
protecting anticipated retirement benefits when such plans terminate “before
sufficient funds have been accumulated[.]” Ceco Concrete Constr., LLC v.
Centennial State Carpenters Pension Tr., 821 F.3d 1250, 1252 (10th Cir. 2016)
(brackets added). To prevent employers from pulling out to “avoid paying for any
shortfalls” upon termination, Congress amended ERISA by enacting the MPPAA. Id.
at 1252–53. The MPPAA imposes “withdrawal liability” on any employer that has
an obligation to contribute but withdraws from the plan. 29 U.S.C. § 1381(a). An
obligation to contribute may arise under “one or more collective bargaining (or
related) agreements[.]” Id. § 1392(a)(1) (brackets added). A “complete withdrawal”
occurs when an employer “permanently ceases to have an obligation to contribute
under the plan,” or “permanently ceases all covered operations under the plan.” Id.
§ 1383(a)(1)–(2); see also Ceco, 821 F.3d at 1253 (reiterating that “withdrawal
liability arises when the employer stops its duty to contribute or ceases covered
operations”).
The MPPAA broadly defines “employer.” The statute provides that all “trades
or businesses (whether or not incorporated) which are under common control” shall
be treated as “a single employer.” 29 U.S.C. § 1301(b)(1). The law incorporates
3
Treasury regulations specifying that “common control” businesses include a “parent-
subsidiary group” connected through “ownership of a controlling interest[.]” 26
C.F.R. § 1.414(c)-2(a)–(b) (brackets added). The statutory definition of “employer”
thus “extend[s] beyond the business entity withdrawing from the pension fund,”
imposing liability on related entities “which, in effect, pierces the corporate veil and
disregards formal business structures.” Ceco, 821 F.3d at 1259 (brackets added,
citation omitted). “[I]f a withdrawing employer is unable to pay in full, a pension
plan can recover the deficiency jointly and severally from any other trade or business
under common control with the withdrawing employer.” Id. (brackets added, citation
omitted).
According to the Fund’s First Amended Complaint, the Fund receives
contributions from several employers as a result of negotiated collective bargaining
agreements (“CBAs”) with certain local unions. App. at 100 ¶ 6. Greystone, a now
defunct Kansas corporation, was one of the employers that previously contributed to
the Fund pursuant to CBAs with the Graphic Communications International Union
(the “Union”). Id. at 101, 103, 106 ¶¶ 11, 22, 44. Coleridge, an Irish company,
became the 100% stockholder of Greystone in 2002. Id. at 100–02, 106 ¶¶ 8, 13, 20,
45. Jelniki, another Irish company, is the parent of Coleridge. Id. at 101, 106 ¶¶ 9–
10, 14, 45. Greystone ceased doing business in 2011, effectuating a complete
withdrawal from the Fund. Id. at 105 ¶ 39.
The Fund alleges that the 2011 withdrawal triggered shared liability for
Coleridge and Jelniki, which were part of Greystone’s common control group under
4
ERISA. Id. at 101–02, 107 ¶¶ 11, 21, 48. In 2013, the Fund obtained a default
judgment against Greystone and its domestic “control group” entities. Id. at 106,
170–71 ¶ 41. The judgment imposed joint and several withdrawal liability upon
those American companies in the amount of $4,454,092.02, but apparently the Fund
has been unable to collect. Id. The Fund initiated this lawsuit in 2014, seeking to
recover from Greystone’s foreign “control group” entities – Coleridge and Jelniki.
Id. at 2, 9–13. The Fund alleges Coleridge and Jelniki used Greystone to expand
their operations in the United States. Id. at 105 ¶¶ 37–38.
The Fund also alleges that Greystone, Coleridge, and Jelniki had overlapping
officers or directors. For example, Kevin Walsh served on the board of directors for
Coleridge, Jelniki, and Greystone. Id. at 105–06 ¶¶ 34, 40. The Fund asserts that
Eugene Reynolds, in addition to serving as a director for Coleridge and Jelniki, acted
as President, Chief Executive Officer, and a board member for Greystone. Id. at 102,
105–06 ¶¶ 29, 40. The Fund maintains that Reynolds played an active role in
negotiating one or more CBAs, pointing to (1) June 2007 correspondence on
Greystone letterhead in which Reynolds urged the Union to accept a “Final”
collective bargaining proposal; and (2) a March 2007 “Agreement” with the Union,
signed by Reynolds and mentioning Greystone, to hold an “off the record” meeting to
allow the Union to “communicate their concerns directly to the owner.” Id. at 104,
142–43 ¶ 30. The Fund avers that, given the managerial positions he held with
Greystone, Reynolds must have known about ERISA withdrawal liability as far back
as 2007. That same year an actuary hired by Greystone indicated he was looking into
5
the issue because it could impact Greystone’s business planning. Id. at 103 ¶ 26.
Reynolds additionally signed a 1994 CBA between the Union and a predecessor to
Greystone. Id. at 104, 144–69 ¶ 32.
Claiming a lack of personal jurisdiction, Coleridge and Jelniki moved to
dismiss the First Amended Complaint. Id. at 180–89. The district court granted the
motion. Id. at 292–310. On appeal, we agreed that the facts set forth in the parties’
pleadings, affidavits, and exhibits were insufficient to establish minimum contacts
consistent with due process. GCIU, 700 F. App’x at 868–71. However, because we
concluded that the Fund was entitled to discovery on the issue of day-to-day
involvement as a potential route to establish minimum contacts, we reversed and
remanded for further proceedings. Id. at 871; see also id. (“On remand, the district
court shall permit jurisdictional discovery of material relating to the question of
whether Coleridge and Jelniki, either directly or through their owners, directors, or
agents, were involved in the day-to-day management of Greystone.”).
We made the following observations in the first appeal. We agreed with the
Seventh Circuit that the “MPPAA’s control group provision regarding withdrawal
liability” does not alter the rule that “stock ownership in or affiliation with a
corporation, without more, is not a sufficient minimum contact.” Id. at 869 (quoting
Cent. States, Se. & Sw. Areas Pension Fund v. Reimer Express World Corp., 230
F.3d 934, 943–45 (7th Cir. 2000)). We assumed arguendo that Reynolds served on
multiple boards and actively participated in the day-to-day management of
Greystone, but found this activity lacking because there were “no credible allegations
6
Mr. Reynolds routinely acted on behalf of Coleridge and Jelniki when he discharged
any of his duties as an officer and director of Greystone.” Id. at 870. We added that
the Fund’s First Amended Complaint failed to allege any involvement by Reynolds in
the actuary’s 2007 decision to solicit withdrawal liability information from the Fund,
let alone any actuarial involvement by Reynolds “in his capacity as an owner or
director of Coleridge or Jelniki.” Id.
To round out our discussion of minimum contacts in the first appeal, we
commented that Reynolds’s involvement in the negotiation of the 2007 CBA
presented “a slightly closer question.” Id. We determined that the June 2007
correspondence on Greystone letterhead provided “no support” for the proposition
that Reynolds “was acting on behalf of either Coleridge or Jelniki during the
negotiations.” Id. We said that the March 2007 Agreement was ambiguous because
the phrase “the owner” could conceivably refer to Coleridge. Id. at 870–71. Still, we
concluded that one meeting between the Union and Reynolds (purportedly acting on
behalf of Coleridge) was insufficient on the facts presented to support the exercise of
specific jurisdiction. Id. at 871.
We further addressed in the first appeal the Fund’s reliance on Pension Benefit
Guaranty Corp. v. Asahi Tec Corp., 839 F. Supp. 2d 118 (D.D.C. 2012), a case in
which a district court denied a foreign parent company’s motion to dismiss ERISA
claims premised on termination liability because, inter alia, (1) the parent acquired
its United States subsidiary with knowledge of the subsidiary’s pension liabilities;
and (2) the parent’s “status” as a member of the “control group,” which arose at the
7
time of the acquisition, was the basis for the plaintiff’s claim. Id. at 120–21, 124–
26. 1 We stated that even if we were “inclined to give any weight” to Asahi Tec, the
facts in GCIU were “not comparable” because there was no proof of potential ERISA
withdrawal liability at the time Coleridge acquired an initial stake in Greystone in
1998 and gained full control of Greystone in 2002. 700 F. App’x at 869. Because
Greystone continued to contribute to the Fund until early 2011, the withdrawal
liability giving rise to the Fund’s claims against Coleridge and Jelniki manifested
“thirteen years after Coleridge acquired a fifty percent ownership in Greystone and
nine years after it acquired the remaining fifty percent interest.” Id.
On remand, the parties conducted jurisdictional discovery. As a result of this
discovery, the Fund identifies these additional material facts:
• The Greystone-Coleridge corporate relationship. Greystone’s facility in
Kansas City, Kansas was the property of United States companies under the
umbrella of a wholly-owned Coleridge subsidiary. App. at 392–93. Three or
four times, Greystone purchased some printing supplies for Coleridge that
were unavailable in Ireland. Id. at 386–87. In 2000, Coleridge provided a
$250,000 loan to Greystone, which Greystone did not repay. Id. at 389–91,
400–01.
1
Following similar logic, the District of Columbia district court later granted a
motion for summary judgment for the plaintiff, reaffirming that the foreign parent
company was subject to personal jurisdiction in the United States. Pension Benefit
Guar. Corp. v. Asahi Tec Corp., 979 F. Supp. 2d 46, 56–64 (D.D.C. 2013).
8
• Trips by board members to the United States. James Lloyd, a member of
Greystone’s board and the Chief Financial Officer (“CFO”) and General
Manager of Greystone, met with Reynolds several times a year. Id. at 371–72,
375–77. Lloyd also met with Walsh on occasion. Id. at 377–78. Greystone
did not pay travel expenses when Reynolds and Walsh came to visit from
Ireland. Id. at 380. For example, Walsh visited Greystone in Kansas City four
times from 1998 to 2005 “on behalf of Coleridge,” and Coleridge paid his
travel expenses. Id. at 402–06, 408.
• Reynolds’s involvement in Greystone matters. Reynolds was involved in an
“advisory capacity” in approving Greystone’s CBAs, and occasionally made a
brief appearance at the beginning of a negotiating session with the Union. Id.
at 381, 384–85. Reynolds discussed withdrawal liability with Lloyd during
2006-2007 negotiations with the Union. Id. at 383. Reynolds also discussed
certain hiring issues with Lloyd. Id. at 394–95. Reynolds at times used
Coleridge telephones to communicate with Lloyd, and Reynolds was involved
in the “winding down” of Greystone. Id. at 419, 428.
• The 2007 Union-related documents signed by Reynolds. As regards the
meeting contemplated by the March 2007 Agreement between Greystone and
the Union, Reynolds was described as “[r]epresenting the owners.” Id. at 422–
24. The June 2007 Greystone letter to the Union Reynolds signed was drafted
by someone else after contract negotiations had broken down. Id. at 425–26.
9
At the close of discovery, Coleridge and Jelniki again sought dismissal for lack
of personal jurisdiction. Id. at 431–54. The district court granted Coleridge’s and
Jelniki’s motion. Id. at 501–15. The district court found that the Reynolds-Walsh
contacts proffered by the Fund were “superficial” and did not demonstrate “day-to-
day involvement in Greystone’s business.” Id. at 510–11, 513–14. The district court
noted the absence of “credible evidence that any actions Reynolds took when he
discharged his duties as an officer of Greystone were on behalf of Coleridge and/or
Jelniki,” and observed there was no proof the meeting referenced in the March 2007
Agreement “ever happened.” Id. at 512–14. The district court likewise found that
Coleridge’s ownership of Greystone’s building, Greystone’s sporadic supply
purchases, and Coleridge’s $250,000 loan were consistent with a conventional
parent-subsidiary relationship and demonstrated no day-to-day involvement. Id. at
511–12. Finally, the district court saw no evidence that the Fund’s alleged injury
arose out of the contacts identified and relied on by the Fund. Id. at 514.
II
“We review de novo the district court’s dismissal for lack of personal
jurisdiction.” Benton v. Cameco Corp., 375 F.3d 1070, 1074 (10th Cir. 2004)
(citation omitted). When challenged, “the plaintiff has the burden of proving
jurisdiction exists.” Id. (citation omitted). When a district court “grants a pre-trial
motion to dismiss without conducting an evidentiary hearing,” this court “accepts as
true the uncontroverted factual allegations in the complaint.” GCIU, 700 F. App’x at
867. A plaintiff in these circumstances need only make a “prima facie showing” that
10
jurisdiction is proper, id., and we “resolve all factual disputes in favor of the
plaintiff[.]” Benton, 375 F.3d at 1074 (citation omitted).
“When a plaintiff’s claims arise under federal law and the defendant is not
subject to the jurisdiction of any state’s court of general jurisdiction,” Federal Rule of
Civil Procedure (“Rule”) 4(k)(2) “provides for federal long-arm jurisdiction if the
plaintiff can show that the exercise of jurisdiction comports with due process.”
GCIU, 700 F. App’x at 867–68. As we have already determined that Rule 4(k)(2)
applies here, the pivotal question is “whether the exercise of federal jurisdiction
satisfies Fifth Amendment due process standards.” Id. at 868. Consistent with the
traditional “minimum contacts” requirement, “a federal court may exercise specific
jurisdiction over a foreign defendant if the defendant purposefully directed its
activities at the forum and the plaintiff’s injuries arose from the defendant’s forum-
related activities.” Id. The Fund relies on specific jurisdiction, not general
jurisdiction, to assert claims against Coleridge and Jelniki.
A
After the first appeal, the Fund had an opportunity on remand to investigate
whether Coleridge and Jelniki were “involved in the day-to-day management of
Greystone.” GCIU, 700 F. App’x at 869–71; see also Good v. Fuji Fire & Marine
Ins. Co., 271 F. App’x 756, 759 (10th Cir. 2008) (unpublished) (“For purposes of
personal jurisdiction, a holding or parent company has a separate corporate existence
and is treated separately from the subsidiary in the absence of circumstances
justifying disregard of the corporate entity.”) (citation and internal quotation marks
11
omitted). The Fund has not generated proof of this type of involvement by the parent
entities. As to post-remand evidence regarding the Greystone-Coleridge corporate
relationship, the Fund does not cite persuasive authority demonstrating that
Greystone’s intermittent purchases of supplies or Coleridge’s alleged ownership
(through other United States subsidiaries) of Greystone’s building constitutes day-to-
day management. The same is true of the $250,000 loan Coleridge made to
Greystone. Cf. Quarles v. Fuqua Indus., Inc., 504 F.2d 1358, 1363–64 (10th Cir.
1974) (indicating that “parent financing of the subsidiary will not make the
subsidiary a mere instrumentality”).
That these Greystone-Coleridge connections fail to establish “day-to-day
control” becomes even clearer when the contacts are viewed in the context of other
uncontested facts. Coleridge and Jelniki were not registered and did not conduct
business in Greystone’s former home state of Kansas. App. at 456 ¶ 4. Coleridge
and Jelniki did not have United States employees. Id. at 479. Coleridge and Jelniki
did not send equipment, supplies, or printing products to Greystone. Id. at 484.
Coleridge and Jelniki had separate budgets, payroll, and business records from
Greystone. App. at 456 ¶ 6. Coleridge and Jelniki filed taxes separately from
Greystone. Id. at 474 ¶ 2. Lloyd, as CFO and General Manager, was responsible for
running Greystone. Id. at 492, 495. He oversaw the accounting, set financial
projections, approved expenses, led Greystone management team meetings, and made
decisions about production and marketing issues. Id. at 463, 465, 494. Lloyd
communicated with Reynolds, but did not need Reynolds’s approval for hiring
12
decisions, id. at 485–86. Cf. United States v. Bestfoods, 524 U.S. 51, 61–62 (1998)
(observing generally that neither “acts incident to the legal status of stockholders”
nor “duplication of some or all of the directors or executive officers” will render a
parent responsible for the wrongdoing of a subsidiary) (citation omitted).
Similarly inadequate is the Fund’s post-remand evidence relating to trips by
board members to the United States and Reynolds’s involvement in certain Greystone
matters. Even assuming that Reynolds communicated and met with Lloyd several
times a year, that Walsh met with Lloyd four times over approximately eight years
“on behalf of Coleridge,” and that Greystone did not pay for all of Reynolds’s trips or
any of Walsh’s trips, 2 those communications and meetings fall short of establishing
day-to-day management:
Exercise of some degree of supervision by a 100% stockholder is not
sufficient to render the subsidiary its instrumentality or alter ego. That
a stockholder should show concern about the company’s affairs, ask for
reports, sometimes consult with its officers, give advice, and even
object to proposed action is but the natural outcome of a
relationship. . . . Such participation in a subsidiary’s affairs does not
amount to the domination of day to day business decisions and disregard
of the corporate entity necessary to impose liability on a parent.
Lowell Staats Mining Co. v. Pioneer Uravan, Inc., 878 F.2d 1259, 1264 (10th Cir.
1989) (citations and internal quotation marks omitted, interpreting Colorado law); see
also Quarles, 504 F.2d at 1363–64 (reaching a similar conclusion while applying
2
At this stage, we must resolve in the Fund’s favor any dispute about whether
Greystone paid for Reynolds’s trips. Reynolds testified that Greystone paid for his
flights, apartment, and car in connection with excursions to Kansas City. App. at
481. Lloyd testified that Greystone did not pay Reynolds’s travel expenses. Id. at
380.
13
Kansas law). The Fund’s proof – especially in light of the additional undisputed
facts described in the preceding paragraph – does not show that Reynolds and Walsh
through their visits and interactions micromanaged Greystone’s operations, even if
one or both of those individuals were acting on Coleridge’s or Jelniki’s behalf.
The Fund’s final category of post-remand evidence concerns CBA negotiations
with the Union. This evidence does not establish day-to-day management of the
CBA process, much less day-to-day management of Greystone as a whole. Assuming
for the sake of argument that travel payments by one or more parent entities meant
Reynolds was acting on behalf of Coleridge or Jelniki when he sent the June 2007
Union correspondence, that letter hardly represents extensive intervention. The
March 2007 Agreement and the Fund’s other Union-related items of proof do not
establish day-to-day control either. Lloyd had the ultimate authority to approve a
contract with the Union. App. at 467, 493. Reynolds’s appearances at Union
negotiating sessions were brief, typically to “say hello” to the participants, and the
only substantive statements Reynolds made before leaving the sessions were to the
effect of “listen to what [the] management team [is] saying.” Id. at 468 (brackets
added). The meeting contemplated by the March 2007 Agreement was “not a
negotiation session,” and there is no evidence this meeting actually took place. Id. at
143, 483.
B
Although the evidence offered by the Fund stops short of establishing day-to-
day control of Greystone by Coleridge or Jelniki, we emphasized in the first appeal
14
that the test for liability is not necessarily coterminous with the test for personal
jurisdiction. See GCIU, 700 F. App’x at 869–70 (“[T]he fact that a defendant would
be liable under a statute if personal jurisdiction over it could be obtained is irrelevant
to the question of whether such jurisdiction can be exercised.”) (brackets added,
citation and internal quotation marks omitted). Accordingly, we are also bound to
consider the customary markers for personal jurisdiction: “(1) whether the defendant
purposefully directed its activities at residents of the forum state; (2) whether the
plaintiff’s injury arose from those purposefully directed activities; and (3) whether
exercising jurisdiction would offend traditional notions of fair play and substantial
justice.” Newsome v. Gallacher, 722 F.3d 1257, 1264 (10th Cir. 2013). Even if we
examine Coleridge’s and Jelniki’s nationwide contacts, see Peay v. BellSouth Med.
Assistance Plan, 205 F.3d 1206, 1211–13 (10th Cir. 2000) (concluding in a federal
question case involving domestic defendants that due process “requires something
more” than “minimum contacts with the United States as a whole”), the first two
prerequisites have not been met, making it unnecessary to address the third.
1
The “purposeful direction” requirement can appear in different guises. “In the
tort context, we often ask whether the nonresident defendant ‘purposefully directed’
its activities at the forum state; in contract cases, meanwhile, we sometimes ask
whether the defendant ‘purposefully availed’ itself of the privilege of conducting
activities or consummating a transaction in the forum state.” Dudnikov v. Chalk &
Vermilion Fine Arts, Inc., 514 F.3d 1063, 1071 (10th Cir. 2008). “In all events, the
15
shared aim of ‘purposeful direction’ doctrine has been said by the Supreme Court to
ensure that an out-of-state defendant is not bound to appear to account for merely
‘random, fortuitous, or attenuated contacts’ with the forum state.” Id. (quoting
Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985)). Here, purposeful
direction is missing, regardless of which test is applied.
The tort standard for purposeful direction often traces back to Calder v. Jones,
465 U.S. 783 (1984). We have interpreted Calder to require an “intentional” action,
“expressly aimed” at the forum state, with “knowledge that the brunt of the injury”
would be felt in that forum. Anzures v. Flagship Rest. Grp., 819 F.3d 1277, 1280
(10th Cir. 2016) (citation omitted). “Calder made clear that mere injury to a forum
resident is not a sufficient connection to the forum.” Walden v. Fiore, 571 U.S. 277,
290 (2014). “The proper question is not where the plaintiff experienced a particular
injury or effect but whether the defendant’s conduct connects him to the forum in a
meaningful way.” Id.
The Fund has not satisfied this criterion. The injury to the Fund is based on
the alleged failure of Coleridge and Jelniki to make pension payments under ERISA
after Greystone’s withdrawal in 2011. We noted in our prior opinion a lack of proof
“that any withdrawal liability actually or even potentially existed” when Coleridge
and Jelniki ostensibly joined Greystone’s “control group” by acquiring 50% of
Greystone in 1998 or 100% of Greystone in 2002. GCIU, 700 F. App’x at 869. We
thus rejected the Fund’s argument that Coleridge or Jelniki “purposefully directed its
activities at the forum” when it obtained a controlling interest in Greystone. Id. The
16
Fund’s post-remand evidence regarding ownership of Greystone’s building, the
extension of a loan to Greystone in 2000, occasional trips to the forum by board
members on Coleridge’s dime, and Reynolds’s marginal involvement with CBAs in
2007 or earlier does not fill this gap. Put another way, none of the Fund’s proof
shows that Coleridge or Jelniki intentionally aimed its conduct at the forum knowing
that these activities would produce pension-related injuries there.
The contract standard for purposeful direction incorporates Burger King, 471
U.S. 462. There, the Supreme Court held that “prior negotiations and contemplated
future consequences, along with the terms of the contract and the parties’ actual
course of dealing,” should be evaluated “in determining whether the defendant
purposefully established minimum contacts within the forum.” Id. at 479; accord
Soma Med. Int’l v. Standard Chartered Bank, 196 F.3d 1292, 1298 (10th Cir. 1999).
Parties who “reach out beyond one state and create continuing relationships and
obligations with citizens of another state are subject to regulation and sanctions in the
other State for the consequences of their activities.” Burger King, 471 U.S. at 473
(citation and internal quotation marks omitted). “[I]t is essential in each case that
there be some act by which the defendant purposefully avails itself of the privilege of
conducting activities within the forum State, thus invoking the benefits and
protections of its laws.” Id. at 475 (quoting Hanson v. Denckla, 357 U.S. 235, 253
(1958)).
Although the “purposeful direction” question in the matter at hand is closer
using the contract test versus the tort test, the answer is the same. Coleridge and
17
Jelniki secured a controlling interest in Greystone, a United States company, but we
expressly rejected the argument in the first appeal that “the acquisition of a company
that participates in a multiemployer pension plan is, by itself, sufficient to establish
personal jurisdiction over the acquiring company[.]” GCIU, 700 F. App’x at 869
(brackets added); see also id. (citing Shaffer v. Heitner, 433 U.S. 186, 213–16 (1977)
for the proposition that due process requires more than just an ownership interest in
an entity located in the forum). The details of any acquisition agreements between
Greystone, Coleridge, and Jelniki have not been explored on appeal, including
whether any share purchase transactions referenced withdrawal liability under
ERISA. Cf. Burger King, 471 U.S. at 480 (noting, inter alia, that the defendant
“entered into a carefully structured 20-year relationship that envisioned continuing
and wide-reaching contacts” with the plaintiff in the forum state, including
contractual statements relevant to the underlying claims that operations would be
conducted and supervised from, notices and payments would be sent to, and
agreements would be made in and enforced from the forum). While the Fund’s post-
remand evidence certainly suggests an ongoing relationship between Coleridge,
Jelniki, and Greystone (as one would expect between a parent and a subsidiary) it
does not connect any purposeful availment to Greystone’s cessation of pension
payments, the event giving rise to this lawsuit. See Bristol-Myers Squibb Co. v.
Super. Ct. of Cal., 137 S. Ct. 1773, 1780 (2017) (confirming that specific jurisdiction
18
“is confined to adjudication of issues deriving from, or connected with, the very
controversy that establishes jurisdiction”) (citation omitted). 3
2
We look next at the second marker for personal jurisdiction: whether “the
litigation results from alleged injuries that arise out of or relate to” a defendant’s
activities purposefully directed at the forum. Burger King, 471 U.S. at 472–73
(citation and internal quotation marks omitted); accord Monge v. RG Petro-
Machinery (Grp.) Co., 701 F.3d 598, 613–14 (10th Cir. 2012). “Some courts have
interpreted the phrase ‘arise out of’ as endorsing a theory of ‘but-for’ causation,
while other courts have required proximate cause to support the exercise of specific
jurisdiction.” Dudnikov, 514 F.3d at 1078 (citations omitted). But-for causation
means “any event in the causal chain leading to the plaintiff’s injury is sufficiently
related to the claim to support the exercise of specific jurisdiction.” Id.
“[C]onsiderably more restrictive” is proximate causation, which turns on “whether
3
The Supreme Court explained in Bristol-Myers Squibb that “since our
decision concerns the due process limits on the exercise of specific jurisdiction by a
State, we leave open the question whether the Fifth Amendment imposes the same
restrictions on the exercise of personal jurisdiction by a federal court.” 137 S. Ct. at
1783–84. Because no party in the case at bar draws any distinction between the Fifth
and Fourteenth Amendments with respect to the “purposeful direction” and “arising
out of” requirements, we assume without deciding that these restrictions are the same
under either Amendment. Cf. Peay, 205 F.3d at 1212 (“The Due Process Clauses of
the Fourteenth and Fifth Amendments are virtually identical, and both were designed
to protect individual liberties from the same types of government infringement.”)
(citation, internal quotation marks, and footnote omitted).
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any of the defendant’s contacts with the forum are relevant to the merits of the
plaintiff’s claim.” Id. (citation omitted).
The causation requirement was highlighted both by this court in the first
appeal and by the district court on remand. We generally noted that “the plaintiff’s
injuries” must “ar[i]se from the defendant’s forum-related activities,” GCIU, 700 F.
App’x at 868 (brackets added), and specifically stated that a 2007 meeting involving
Reynolds was insufficient “to support the exercise of specific jurisdiction,
particularly when the Fund has not alleged how its injuries arose from that meeting.”
Id. at 871. In its second dismissal order, the district court echoed that “the plaintiff’s
injuries [must have arisen] from the defendant’s forum-related activities,” App. at
514 (brackets in original), held that the Fund’s injuries “arose because Greystone
went out of business and withdrew from the fund,” and saw no evidence that these
harms “arose from Reynolds’ and Walsh’s limited contacts (on behalf of Coleridge
and Jelniki) with the United States.” Id.
In its opening brief in this appeal, however, the Fund did not address the extent
to which its injuries arose out of purposefully-directed activities of Coleridge and
Jelniki. The phrase “arising out of or relating to” does not appear in the Fund’s issue
headings, and the Fund did not present an organized “causation” argument in its
initial brief. Aplt. Br. at i–ii, 13–30. By these omissions, the Fund forfeits any
challenge to the district court’s ruling on this ground. See Rivero v. Bd. of Regents,
950 F.3d 754, 763 (10th Cir. 2020) (“If the district court states multiple alternative
grounds for its ruling and the appellant does not challenge all these grounds in the
20
opening brief, then we may affirm the ruling.”); United States ex rel. Little v.
Triumph Gear Sys., Inc., 870 F.3d 1242, 1250 (10th Cir. 2017) (determining that
appellants waived their argument “by failing to raise it in their opening brief”). 4 This
problem cannot be remedied by arguments about the “arising out of” requirement
raised for the first time in the Fund’s reply brief. See Sandoval v. Unum Life Ins. Co.
of Am., --- F.3d ----, 2020 WL 1265671, at *6 n.4 (10th Cir. 2020) (“Unum does raise
this argument in the reply brief, but this was too late.”); Singh v. Cordle, 936 F.3d
1022, 1043 (10th Cir. 2019) (same).
In sum, we need not decide whether but-for or proximate causation is
necessary, because the Fund in its opening brief did not meaningfully address the
“arising out of” requirement. The district court invoked this requirement in its
dismissal order. The Fund expressly grappled with the issue only after Coleridge and
Jelniki raised it in their response brief. Aple. Br. at iii, 19–21; Aplt. Reply Br. at i,
8–10. That response by the Fund comes too late. We must uphold the district court’s
unchallenged ruling on causation.
C
The Fund’s remaining argument is that this case is materially similar to Asahi
Tec, 839 F. Supp. 2d at 120, 124–25, where a federal court in the District of
4
Similarly insufficient are any passing and undeveloped references in the
Fund’s initial brief to causation (e.g., Aplt. Br. at 15). See Anderson Living Trust v.
Energen Res. Corp., 886 F.3d 826, 831 n.6 (10th Cir. 2018) (reasoning that
appellants who identify an issue in an opening brief “but otherwise fail to develop it,
providing no argument or legal authority to support it,” remain subject to waiver).
21
Columbia exercised personal jurisdiction over a parent company charged with a
subsidiary’s termination liability under ERISA. We explained why this dispute
differs from Asahi Tec in our prior opinion. GCIU, 700 F. App’x at 868–69. In any
event, the Fund has forfeited this contention as well. Coleridge and Jelniki point out
that the Fund did not argue to the district court on remand that Asahi Tec (based on
facts developed after the first appeal) was controlling. Aple. Br. at 22. The Fund
offers no response in its reply brief. Aplt. Reply Br. at ii, 1–19; see also App. at
333–60 (setting forth the contents of the Fund’s post-remand brief to the district
court, without reference to Asahi Tec). The Fund’s abandonment of Asahi Tec in the
district court obviates the need for us to now address it on appeal. See Strauss v.
Angie’s List, Inc., 951 F.3d 1263, 1266 n.3 (10th Cir. 2020) (“Generally, this court
does not consider arguments raised for the first time on appeal.”).
III
We affirm the district court’s dismissal of the Fund’s claims against Coleridge
and Jelniki for lack of personal jurisdiction.
Entered for the Court
Mary Beck Briscoe
Circuit Judge
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