Henry Zoch, II v. Daimler, AG ( 2020 )

Case: 18-41151 Document: 00515391942 Page: 1 Date Filed: 04/22/2020
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
April 22, 2020
No. 18-41151
Lyle W. Cayce
Clerk
HENRY ZOCH, II, Individually and on behalf of The Estate of Henry Zoch
III, Deceased,
Plaintiff - Appellant
v.
MAGNA SEATING (GERMANY) GMBH, formerly known as Intier
Automotive Seating Systems, GmbH,
Defendant - Appellee
Appeal from the United States District Court
for the Eastern District of Texas
USDC No. 4:17-CV-578
Before SOUTHWICK, GRAVES, and ENGELHARDT, Circuit Judges.
KURT D. ENGELHARDT, Circuit Judge:*
Plaintiff-Appellant, Henry Zoch, II, appeals the district court’s dismissal
of his claims against Defendant-Appellee, Magna Seating (Germany) GmbH,
under Federal Rule of Civil Procedure 12(b)(2) for lack of personal jurisdiction.
The primary issue for our consideration in this appeal is whether the district
court erred in determining that, under a stream-of-commerce theory, it could
* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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not exercise specific jurisdiction over Magna Seating (Germany) GmbH, a
foreign manufacturer of vehicle component parts. For the reasons set forth
herein, under the particular facts of this case, we conclude that specific
jurisdiction is lacking and that the district court’s judgment should be
affirmed.
FACTS AND PROCEEDINGS
Underlying Facts
On October 15, 2014, 31-year-old Henry Zoch, III (“Zoch”) was driving
his 2008 Daimler Smart Fortwo in Plano, Texas, when he was rear-ended by a
2006 Ford Taurus after slowing or stopping for traffic. The impact pushed
Zoch’s vehicle into the Toyota Camry in front of it. Neither of the drivers of
the other two vehicles involved was seriously injured, and the damage to Zoch’s
vehicle was relatively minimal. However, due to an alleged malfunction in the
driver’s seat anchor of Zoch’s Smart Fortwo, the seat collapsed “rear-ward” and
“inboard” during the accident, causing Zoch to be propelled backward inside
the vehicle and hit his head on the rear of the vehicle’s interior. As a result,
Zoch suffered a brain injury and died the following day.
The Smart Fortwo that Zoch owned and was driving at the time of his
accident (sometimes referred to herein as “the subject vehicle”) was designed
by Daimler AG (“Daimler”) in Germany. It, like other 2008 Smart Fortwos,
was manufactured in France, using component parts from various suppliers.
The metal structural components of the driver’s seat for the vehicle were
designed by German company C. Rob Hammerstein GmbH & Co. KG, later
known as Johnson Controls Metals and Mechanisms GmbH & Co. KG,
(“JCMM”) in Germany in accordance with specifications provided to it by
Daimler AG. One of JCMM’s sister companies then manufactured the metal
and structural components of the 2008 Smart Fortwo seats, which were sold
and supplied to Appellee herein, Magna Seating (Germany) GmbH (“Magna”),
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formerly known as Intier Automotive Seating Systems, GmbH. 1 Magna, in
turn, assembled the seats for the 2008 Smart Fortwo, including the structure,
trim, foam and plastic parts, in Germany, after which it sold and furnished the
finished seats to Daimler’s Smart Fortwo assembly plant in France.
Completed 2008 Smart Fortwos were sold across the globe, with Europe being
the largest market for the vehicle.
After being manufactured in France, the subject vehicle was sold to
Smart USA Distributor LLC, which was the general importer of Smart vehicles
to the United States at the time. In September 2008, Smart USA Distributor
LLC sold the vehicle to Mercedes-Benz of Houston North. Thomas Berggren
III bought the vehicle from that dealership on or around September 19, 2008.
Mr. Berggren kept and used the vehicle in Louisiana for about six years. A
Toyota dealership in Plano, Texas, acquired the vehicle from Rosary Berggren,
a Louisiana resident, through a trade-in. Zoch then purchased the instant
vehicle and, shortly thereafter, he and the vehicle were involved in the fatal
accident.
District Court Proceedings
Following Zoch’s death, his father, Henry Zoch, II (“Plaintiff”), instituted
this products-liability lawsuit on behalf of himself and Zoch’s estate, against
multiple parties allegedly responsible for Zoch’s death, including Magna, in the
United States District Court for the Eastern District of Texas, Tyler Division,
invoking diversity jurisdiction. 2 Magna is alleged to have “designed, tested,
and supplied the [driver’s] seat [in Zoch’s Smart Fortwo], chose[n] the metal
used in the seat’s anchorage and fittings, and designed the seat-related
1 Magna, a German company, “designs, develops, and manufactures automobile seats,
seating assemblies and component parts in Germany, which are then supplied to various
automobile manufacturer assembly plants in Europe.”
2 The case was later transferred to the Sherman division on a 28 U.S.C. § 1404(a)
motion to transfer venue.
3
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components and anchorages generally.” Plaintiff’s complaint asserts causes of
action against all defendants for, inter alia, “design defect,” “manufacturing
defect,” negligence, and violation of Texas Civil Practice and Remedies Code
82.003.
After allowing the parties to conduct limited jurisdictional discovery, but
without conducting a hearing, the magistrate judge (“magistrate”) issued a
report and recommendation suggesting that a Rule 12(b)(2) motion to dismiss
for lack of personal jurisdiction filed by Magna should be granted. In his report
and recommendation, the magistrate rejected Plaintiff’s arguments that the
court could exercise specific jurisdiction over Magna under the stream-of-
commerce theory. The district judge adopted the magistrate’s report and
recommendation, granted Magna’s motion, and dismissed the claims against
Magna for lack of personal jurisdiction. 3 Plaintiff now appeals the district
court’s ruling, arguing that the magistrate and the district court improperly
applied a stream-of-commerce approach that is stricter than the one adopted
by this court. As discussed below, we find that it was proper to grant Magna’s
motion to dismiss for lack of personal jurisdiction.
STANDARD OF REVIEW
We review a Rule 12(b)(2) dismissal for lack of personal jurisdiction de
novo. Patterson v. Aker Sols. Inc., 826 F.3d 231, 233 (5th Cir. 2016). The
plaintiff has the burden of establishing jurisdiction. Id. Where, as here, the
district court rules on a Rule 12(b)(2) motion without conducting an evidentiary
hearing, the plaintiff may meet his burden with prima facie evidence. Id.; see
also Halliburton Energy Servs., Inc. v. Ironshore Specialty Ins. Co., 921 F.3d
522, 539 (5th Cir. 2019). In determining whether the plaintiff has presented a
3 In the same order, the district court dismissed Plaintiff’s claims against two other
defendants—JCMM and Magna International, Inc.—for lack of personal jurisdiction.
Plaintiff does not appeal the dismissal of his claims as to those defendants. With respect to
JCMM, Plaintiff ultimately settled his claims.
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prima facia case of personal jurisdiction, we “must accept the plaintiff’s
uncontroverted allegations, and resolve in his favor all conflicts between the
facts contained in the parties’ affidavits and other documentation.” Patterson,
826 F.3d at 233 (alteration in original omitted) (internal quotation marks and
citation omitted).
DISCUSSION
General Principles of Personal Jurisdiction
“[A] federal district court’s authority to assert personal jurisdiction in
most cases is linked to service of process on a defendant who is subject to the
jurisdiction of a court of general jurisdiction in the state where the district
court is located.” Walden v. Fiore, 571 U.S. 277, 283 (2014) (quoting FED. R.
CIV. P. 4(k)(1)(A)). Thus, in a diversity case, a federal court may exercise
personal jurisdiction over a non-resident defendant if “the forum state’s long-
arm statute extends to [such] defendant and the exercise of jurisdiction
comports with due process.” Carmona v. Leo Ship Mgmt., Inc., 924 F.3d 190,
193 (5th Cir. 2019). Since “the Texas long-arm statute extends to the limits of
federal due process, the two-step inquiry reduces to only the federal due
process analysis.” Halliburton Energy Servs., Inc., 921 F.3d at 530; see also
Spir Star AG v. Kimich, 310 S.W.3d 868, 872 (Tex. 2010) (“Our long-arm
statute reaches as far as the federal constitutional requirements for due
process will allow. Consequently, the statute’s requirements are satisfied if
exercising jurisdiction comports with federal due process limitations.” (internal
quotation marks and citations omitted)).
“Because a state court’s assertion of jurisdiction exposes defendants to
the State’s coercive power, it is subject to review for compatibility with the
Fourteenth Amendment’s Due Process Clause, which limits the power of a
state court to render a valid personal judgment against a nonresident
defendant.” Bristol-Myers Squibb Co. v. Super. Ct. of Cal., S.F., 137 S. Ct.
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1773, 1780 (2017) (alterations in original omitted) (internal quotation marks
and citations omitted). To comport with due process demands, a plaintiff in a
diversity case must establish that the non-resident defendant “purposely
availed himself of the benefits and protections of the forum state by
establishing minimum contacts with the state” and that “the exercise of
jurisdiction [] does not offend traditional notions of fair play and substantial
justice.” Halliburton Energy Servs., Inc., 921 F.3d at 530 (internal quotation
marks and citations omitted).
Certain types of contacts support a court’s exercise of general jurisdiction
over a non-resident defendant, while others support exercise of specific
jurisdiction. Id. General jurisdiction “requires continuous and systematic
forum contacts and allows for jurisdiction over all claims against the
defendant, no matter their connection to the forum.” In re Depuy Orthopaedics,
Inc., Pinnacle Hip Implant Prod. Liab. Litig., 888 F.3d 753, 778 (5th Cir. 2018)
(internal quotation marks and citation omitted). Specific jurisdiction, on the
other hand, demands a connection between the suit and the forum. Bristol-
Myers Squibb Co., 137 S. Ct. at 1780. On appeal, as below, Plaintiff makes no
arguments as to general jurisdiction, only urging that specific jurisdiction
exists as to Magna. Plaintiff further limits his argument to the applicability
of the stream-of-commerce theory, which is discussed below. Thus, our focus
is also so-limited.
Specific Jurisdiction
Whether specific jurisdiction can be properly asserted over a non-
resident defendant is dependent on “the relationship among the defendant, the
forum, and the litigation.” Walden, 571 U.S. at 283–84 (internal quotation
marks and citation omitted). For the exercise of specific jurisdiction to comply
with due process, “the suit must arise out of or relate to the defendant’s
contacts with the forum.” Bristol-Myers Squibb Co., 137 S. Ct. at 1780
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(alternations in original omitted) (internal quotation marks and citation
omitted). “In other words, there must be an affiliation between the forum and
the underlying controversy, principally, an activity or an occurrence that takes
place in the forum State and is therefore subject to the State’s regulation.” Id.
(alteration in original omitted) (internal quotation marks and citation
omitted). Such activity or occurrence must “create a substantial connection
with the forum State.” Walden, 571 U.S. at 284. Absent this connection,
“specific jurisdiction is lacking regardless of the extent of a defendant’s
unconnected activities in the State.” Bristol-Myers Squibb Co., 137 S. Ct. at
1781. “[A] defendant’s general connections with the forum are not enough.”
Id. Consistent with these principles, “specific jurisdiction is confined to
adjudication of issues deriving from, or connected with, the very controversy
that establishes jurisdiction.” Id. at 1780 (internal quotation marks and
citation omitted).
Considering the foregoing precepts, in determining whether due process
allows the exercise of specific jurisdiction, this court applies the following
three-factor test:
(1) whether the defendant has minimum contacts with the forum
state, i.e., whether it purposely directed its activities toward the
forum state or purposefully availed itself of the privileges of
conducting activities there; (2) whether the plaintiff’s cause of
action arises out of or results from the defendant’s forum-related
contacts; and (3) whether the exercise of personal jurisdiction is
fair and reasonable.
Carmona, 924 F.3d at 193 (quoting Seiferth v. Helicopteros Atuneros, Inc., 472
F.3d 266, 271 (5th Cir. 2006)).
Notably, with respect to the minimum-contacts inquiry (our factor 1), the
Supreme Court has stressed that, because due process limits states’ judicial
authority in order to protect the liberty of non-resident defendants, significant
contacts are those that “the defendant himself creates with the forum State.”
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Walden, 571 U.S. at 284 (quoting Burger King Corp. v. Rudzewicz, 471 U.S.
462 (1985)); see also Bristol-Myers Squibb Co., 137 S. Ct. at 1779 (“The primary
focus of our personal jurisdiction inquiry is the defendant’s relationship to the
forum State.”) Thus, while “a defendant’s contacts with the forum State may
be intertwined with his transactions or interactions with the plaintiff or other
parties,” the “defendant-focused ‘minimum contacts’ inquiry” cannot be
satisfied by merely demonstrating contacts between the plaintiff or a third
party and the forum state. Walden, 571 U.S. at 284, 286.
If the plaintiff demonstrates satisfaction of the first two factors with
respect to each of his claims, then the burden shifts to the non-resident
defendant to show, under the third factor, “that exercising jurisdiction would
be unfair or unreasonable.” Monkton Ins. Servs., Ltd. v. Ritter, 768 F.3d 429,
433 (5th Cir. 2014).
Stream-of-Commerce Theory
In the context of products-liability cases, like the case presently before
us, an analysis involving a stream-of-commerce metaphor is often employed to
assess whether the non-resident defendant has minimum contacts with the
forum (our factor 1). 4 As the Supreme Court has explained, courts use the
metaphor to allow for jurisdiction where “the product has traveled through an
4The modern jurisdictional stream-of-commerce concept stems from World-Wide
Volkswagen Corp. v. Woodson, 444 U.S. 286, 298 (1980), where the Supreme Court stated:
[I]f 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.
Id.
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extensive chain of distribution before reaching the ultimate consumer.”
Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 926 (2011)
(internal quotation marks and citation omitted). The stream-of-commerce
doctrine “recognizes that a defendant may purposefully avail itself of the
protection of a state’s laws—and thereby [] subject itself to personal
jurisdiction—by sending its goods rather than its agents into the forum.” In
re: Depuy Orthopaedics, Inc., 888 F.3d at 753.
The Fifth Circuit has found this doctrine and thus minimum contacts
satisfied so long as the court determines “that the defendant delivered the
product into the stream of commerce with the expectation that it would be
purchased by or used by consumers in the forum state.” Ainsworth v. Moffett
Eng'g, Ltd., 716 F.3d 174, 177 (5th Cir. 2013) (quoting Bearry v. Beech Aircraft
Corp., 818 F.2d 370, 374 (5th Cir.1987)). In other words, “mere foreseeability
or awareness [is] a constitutionally sufficient basis for personal jurisdiction if
the defendant's product made its way into the forum state while still in the
stream of commerce.” Id. (quoting Luv N' care, Ltd. v. Insta–Mix,
Inc., 438 F.3d 465, 470 (5th Cir.2006)); Ruston Gas Turbines, Inc. v. Donaldson
Co., Inc., 9 F.3d 415, 419 (5th Cir. 1993). But, “[t]he defendant’s contacts [with
the forum state] must be more than ‘random, fortuitous, or attenuated, or [the
result] of the unilateral activity of another party or third person.’” ITL Int’l,
Inc. v. Constenla, S.A., 669 F.3d 493, 498 (5th Cir. 2012)).
In Ainsworth, we reaffirmed the validity of our stream-of-commerce test
despite the Supreme Court’s interjection on the topic in McIntyre, a fractured
opinion which did not produce a majority. 5 Ainsworth, 716 F.3d at 178 (citing
5 The facts of McIntyre are straightforward: the plaintiff was injured by a machine,
which was produced by a manufacturer in England and sold to a national distributer who
sold that machine―and no others―to New Jersey. 563 U.S. at 878. The New Jersey Supreme
Court found that New Jersey could exert personal jurisdiction over the English manufacturer
under its stream of commerce theory. Id. The Supreme Court reversed. Id.
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J. McIntyre Machinery, Ltd. v. Nicastro, 563 U.S. 873 (2011)). We recognized
that our test, “in not requiring that the defendant target the forum, was in
tension with the plurality opinion” of Justice Kennedy, 6 which would “permit[]
the exercise of jurisdiction only where the defendant can be said to have
targeted the forum.” Id. (citing McIntyre, 563 U.S. at 882 (Kennedy, J.)). But
that opinion was not, we explained, controlling. 7 Id. Rather, “[w]hen a
fragmented Court decides a case and no single rationale explaining the result
enjoys the assent of five Justices, the holding of the Court may be viewed as
that position taken by those Members who concurred in the judgments on the
narrowest grounds.” Id. (quoting Marks v. United States, 430 U.S. 188, 193
(1977)). Accordingly, we held that it was Justice Breyer’s concurring opinion
that “furnished the narrowest grounds for the decision” and was controlling.
Id. And, because Justice Breyer simply applied existing Supreme Court
precedent to the specific facts presented in that case, our pre-McIntyre stream-
of-commerce holdings were not abrogated. Id.
Yet, we also acknowledged that Justice Breyer’s concurrence illuminated
the outer limits of our “foreseeability” test. Id. at 178-79. He criticized New
Jersey’s test for personal jurisdiction, which would subject a foreign defendant
to jurisdiction so long as it “knows or reasonably should know that its products
are distributed through a nationwide distribution system that might lead to
those products being sold in any of the fifty states.” McIntyre, 563 U.S. at 891.
Justice Breyer cautioned against such a test that would “rest jurisdiction…
upon no more than the occurrence of a product-based accident in the forum
State” and “permit every State to assert jurisdiction in a products-liability suit
against any domestic manufacturer who sells its products (made anywhere in
6Justice Kennedy was joined by Justices Roberts, Scalia, and Thomas.
7A principal more recently reiterated in In re Chinese-Manufactured Drywall Prod.
Liab. Litig., 753 F.3d 521, 549 (5th Cir. 2014)(“Our stream-of-commerce test, in not requiring
that the defendant target the forum, is in tension with [McIntyre’s ] plurality opinion.”)
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the United States) to a national distributor, no matter how large or small the
manufacturer, no matter how distant the forum, and no matter how few the
number of items that end up in the particular forum at issue.” Id.
Nonetheless, in Ainsworth, we found it unnecessary to “call upon such a
broad power” for Mississippi to exercise jurisdiction over the foreign
manufacturer, Moffett. 716 F.3d at 179. Instead, we determined that Moffett’s
203 forklift sales in Mississippi over ten years, which constituted 1.55% of its
United States sales, soundly established sufficient minimum contacts to vest
that authority in Mississippi. Id. This was true notwithstanding that Moffett
lacked actual knowledge of those sales because Mississippi was the fourth
largest poultry-producing state in the country, and Moffett’s forklifts were
designed for poultry-related uses. Id. Thus, Moffett could have reasonably
expected that such sales would be made and that it could also be haled into
court in Mississippi. Id.
Analysis
Keeping these principles in mind, we now turn to whether Magna could
have reasonably expected that its product would be sold or used in Texas. 8 In
8 Magna argues that we should apply the “stream-of-commerce-plus” test used by
Texas courts over our own stream-of-commerce approach if we determine that the two would
produce different results. Because we conclude that the district court lacks personal
jurisdiction over Magna under this court’s application of the stream-of-commerce doctrine,
which Magna contends is less stringent than Texas’, we need not resolve the merits of
Magna’s argument. We point out, however, that both the Texas Supreme Court and this
court have recognized that Texas’ long-arm statute extends to the limits of federal due
process. See Halliburton Energy Servs., Inc., 921 F.3d at 530; Spir Star AG, 310 S.W.3d at
872 (“Our long-arm statute reaches as far as the federal constitutional requirements for due
process will allow. Consequently, the statute’s requirements are satisfied if exercising
jurisdiction comports with federal due process limitations.” (internal quotation marks and
citations omitted)). Thus, when a Texas court interprets and applies the stream-of-commerce
theory to determine whether a non-resident defendant has sufficient minimum contacts with
Texas to allow for the exercise of personal jurisdiction, it engages in a federal due process
analysis—not an interpretation of the Texas long-arm statute. Magna provides no authority
as to why this court should give Texas courts’ interpretation of the requirements of federal
due process precedence over our own. Accordingly, without expressly deciding, we note that
Magna’s argument appears to lack merit.
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arguing affirmatively, Zoch proffered evidence that Magna knew it was
supplying seats for more than 130,000 Smart Fortwo vehicles destined to be
sold in the United States; its contract with Damlier required unique designs to
meet safety standards specific to the United States; and, Magna did not
attempt to geographically limit where the cars and, in turn, its seats would be
sold. Zoch contends that the foregoing facts, along with the facts that Texas is
one of the largest and most populated states; that Texas has one of the largest
American motor vehicle markets in terms of licensed drivers and registered
vehicles; and that four Smart Fortwo dealerships were opened in Texas,
demonstrate that Magna must have known, and even intended, that its 2008
Smart Fortwo drivers seats would be sold and used in Texas.
But this evidence demonstrates only that Magna, a German company,
manufactured, sold, and supplied vehicle seats for 2008 Smart Fortwos to
Daimler’s assembly plant in France, knowing that those seats would be placed
in vehicles ultimately destined for the United States generally, not Texas
specifically. Importantly, Plaintiff has not provided, and conceded at oral
argument that he does not have, any evidence that Magna was aware that any
of its seats manufactured for the 2008 Smart Fortwo would likely end up in
Texas. Such attenuated activity and scarce knowledge by Magna cannot be
said to have “create[d] a substantial connection with the forum State [of
Texas].” Walden, 571 U.S. at 284.
While jurisdiction does not rely on a finding that Magna targeted Texas,
there must be some proof that it placed its product “into the stream of
commerce with the expectation that it would be purchased by or used by
consumers in the forum state.” Ainsworth,716 F.3d at177 (emphasis added).
Zoch’s evidence regarding the number of registered drivers and vehicles in
Texas is insufficient to conclude that Magna “should [have] reasonably
anticipate[d] being haled into court there.” World-Wide Volkswagen Corp., 444
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U.S. at 297. This is because there are drivers and vehicles in each of the fifty
states, 9 and Zoch’s evidence, at most, proves only that its contract with Damlier
“might lead to those products being sold in any of the fifty states.” McIntyre,
564 U.S. at 890–91 (Breyer, J.) (internal quotation marks and citation
omitted). Thus, this case is unlike Ainsworth, where the forum state was
unique in its poultry production―a form of commerce, unlike the automobile
industry, that is not immensely prevalent among citizens of each of the fifty
states. Ainsworth,716 F.3d at177.
But this case is distinct from Ainsworth in other important respects as
well. First, Zoch presented no evidence as to the number of 2008 Smart
Fortwos actually sold in Texas or income generated from those Texas sales
from which we could perhaps infer Magna’s knowledge of the likely number of
its seats that would end up in that state. And, without these numbers, we can
only speculate whether Magna’s contacts with Texas more closely resemble
McIntyre’s single metal sheering machine found in New Jersey or Ainsworth’s
two hundred forklifts found in Mississippi. 10 Only the latter would make a
strong case for jurisdiction. Second, unlike the manufacturer in Ainsworth,
Magna did not have an exclusive sales contract with the distributor and did
not have control over or delegate control over the sales or marketing of the
final product. Id. at 177 (The foreign defendant “was aware that[, pursuant to
9 Zoch makes much of the fact that there are four Smart Fortwo dealerships in Texas.
But because there is no evidence that Magna was aware of these dealerships, we are not
convinced that their existence alone makes it more reasonable for Magna to expect its seats
to be sold in Texas. And, other than because Texas has the second most registered drivers in
the United States, Zoch offers no additional reasons why Magna would reasonably expect
Damlier to have four dealerships in Texas. Thus, Zoch’s two arguments―that Texas has the
second most drivers and that Texas has the second most dealerships―collapse in on each
other.
10 It may be reasonable to assume, due to the four dealerships in Texas, that more
than one Smart Fortwo was sold there. However, Zoch bears the burden of proof on the first
two elements of jurisdiction, so we are reluctant to assume that enough Smart Fortwos were
sold in Texas to, like Ainsworth, find minimum contacts satisfied on this basis.
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the exclusive sales and distribution agreement, the distributor] marketed its
product throughout the entire United States”). Rather, Magna provided a
component part of the product to a manufacturer, Damlier, who then controlled
these aspects. 11 We therefore lack the type of conclusive evidence the court in
Ainsworth relied on in finding that the manufacturer had minimum contacts
with the forum state.
Finally, we note that Zoch’s argument, at its core, relies on the fact that
Texas―by virtue of it being a populous state―commands a large portion of the
automobile market. Permitting jurisdiction in this instance, without more
than the facts in this record, would essentially confer jurisdiction to any state
with a large population where a manufacturer sells its products to a national
distributor. Justice Breyer’s McIntyre concurrence cautioned against these
types of broad sweeping jurisdictional tests and advised considering additional
limiting factors in these circumstances, i.e., the number of products in the
forum state, the size of the manufacturer, and its proximity to the forum.
McIntyre, 563 U.S. at 891. And, again, Zoch failed to produce any concrete
evidence of the number of Smart Fortwos in Texas or of Magna’s size; but we
do know that Magna is domiciled far from the forum state in Germany.
Therefore, Justice Breyer’s additional limitations further suggest that
jurisdiction is improper in Texas.
We emphasize that our holding in this case―that application of the
stream-of-commerce theory does not result in a finding of minimum
contacts―is limited to the specific facts of this case. We make no broad
pronouncements with respect to the stream-of-commerce theory; and our
11 In assessing Magna’s contacts (or lack thereof) with Texas, we will not impute any
conduct or knowledge of Daimler, Smart USA Distributor LLC, or any other entity to Magna,
since the “defendant-focused ‘minimum contacts’ inquiry” cannot be satisfied by merely
demonstrating contacts between . . . a third party and the forum state. Walden, 571 U.S. at
284, 286.
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decision should not be read as prohibiting the exercise of specific jurisdiction
over all component parts manufacturers. Specific jurisdiction should be
determined on a case-by-case basis under the facts of each individual case.
Because we conclude that Plaintiff did not establish minimum contacts
with Texas and, therefore, did not satisfy the first prong of this court’s three-
factor test for specific jurisdiction, we need not address the second and third
prongs of our test—whether Plaintiff’s claims arises out of Magna’s contacts
with Texas and whether exercising jurisdiction over Magna would be fair and
reasonable. See Carmona, 924 F.3d at 193.
CONCLUSION
For the reasons set forth above, the judgment of the district court is
AFFIRMED.
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