Opinion
Civil Action 7:22-3738-TMC-KFM
06-21-2023
Kelly Dawsey, Plaintiff, v. Bayerische Motoren Werke Aktiengesellschaft and BMW Manufacturing Co., LLC, Defendants.
REPORT OF MAGISTRATE JUDGE
Kevin F. McDonald, United States Magistrate Judge.
This matter is before the court on defendant Bayerische Motoren Werke Aktiengesellschaft's (“BMW AG”) motion to dismiss for lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(2) (doc. 42). Pursuant to the provisions of 28 U.S.C. § 636(b)(1)(A) and Local Civil Rule 73.02(B)(2)(g) (D.S.C.), all pretrial matters in employment discrimination cases are referred to a United States Magistrate Judge for consideration.
I. BACKGROUND AND FACTUAL ALLEGATIONS
BMW AG is a corporation organized and existing under the laws of the Federal Republic of Germany, with its principal place of business and corporate headquarters in Munich, Germany (doc. 42-3, Kopnick decl. ¶ 5). BMW AG is a co-parent to over 200 direct and indirect subsidiaries that operate throughout the world, and BMW AG and its subsidiaries employ over 100,000 individuals (id. ¶ 6). Defendant BMW Manufacturing Co., LLC ("BMW MC") is an indirect subsidiary of BMW AG that assembles certain models of BMW vehicles (doc. 42-2, McCraw decl. ¶¶ 5-6). BMW MC is an LLC created under the laws of Delaware with its principal place of business in Greer, Spartanburg County, South Carolina (id. ¶ 4). BMW AG is not licensed or registered to do business in South Carolina or any other state, and it has no facilities, offices, or real property in South Carolina (doc. 42-3, Kopnick decl. ¶¶ 7-11). Moreover, BMW AG does not directly own or hold any interest in BMW MC, and BMW AG and BMW MC are separated by four intermediate entities (id. ¶ 15).
Claudia Kopnick ("Ms. Kopnick"), the current vice president of human resources ("HR") for BMW AG, provided in a declaration that BMW AG and BMW MC have separate management teams and the corporate affairs of BMW AG are directed by a board of management (doc. 42-3, Kopnick decl. ¶¶ 16-17). Further, BMW AG does not maintain BMW MC's corporate books and records, nor does it file BMW MC's tax returns (id. ¶ 19). Sherry McCraw ("Ms. McCraw"), the current vice president of HR at BMW MC, provided in her declaration that BMW MC is managed by its own independent management team, led by the president and chief executive officer of BMW MC (doc. 14-3, McCraw decl. ¶ 9). Under the president, BMW MC's departments are led by vice presidents (id. ¶ 10).
The plaintiff, a white, United States citizen, was an employee at BMW MC from 1995 until she resigned in 2022 (doc. 20, am. compl. ¶¶ 39, 63). After a series of promotions, the plaintiff last served in a position known as TX-60, which is a department manager for HR planning (id. ¶¶ 39-40). TX-60 is a Level III position, which is one rung below the vice president level at Level II (id. ¶¶ 35-40). The president is the only Level I position, and the current president of BMW MC is Robert Engelhorn ("Dr. Engelhorn") (id. ¶ 35). Dr. Engelhorn is German, which individuals working at BMW MC refer to as an "ex-pat" or "international" (id. ¶¶ 10, 35). In the TX-60 role, the plaintiff reported to Christina Petrasch ("Ms. Petrasch"), a German who served as the vice president of HR at BMW MC (id. ¶ 33).
The plaintiff testified that BMW AG was involved regularly in the operational issues in HR in Greer and that she dealt directly with the corporate office in Germany on a weekly basis (doc. 45-1, plaintiff decl. ¶ 14). Dr. Engelhorn also provided in his deposition that the individual in the TX-60 position interacted with BMW AG employees on a regular basis, sometimes with daily calls (doc. 59-1, Engelhorn dep. 57:17-24). The plaintiff further testified that BMW AG "had [her] answer on [BMW MC's] ongoing issues, including salary planning and staffing. Such decisions were not made only at a local level by BMW MC employees" (doc. 45-1, plaintiff decl. ¶ 14). The plaintiff provided that BMW AG also had to approve any changes in benefits, salary structure, bonuses, and management structure (id. ¶ 17). However, Ms. Kopnick provided that BMW AG does not exercise operational control of BMW MC or day-to-day control of the internal HR affairs of BMW MC (doc. 42-3, Kopnick decl. ¶ 20). In addition, Ms. McCraw asserted in her declaration that BMW MC controls the day-to-day affairs of BMW MC, including the internal HR affairs (doc. 42-2, McCraw decl. ¶ 11).
The plaintiff alleged that the defendants represent themselves collectively as "BMW Group" and maintain a common website (doc. 20, am. compl. ¶ 5). On its website, BMW provides that it is a "global company" and that "BMW Group operates 31 production and assembly facilities in 15 countries and has a global sales network in more than 140 countries" (id. ¶¶ 5, 8) (citing https://www.bmwgroup.com). The plaintiff asserted that BMW advertises for career ladders under which applicants are told that they can transfer to different operations, such as the one in Greer (id. ¶ 9).
Dr. Engelhorn testified that “BMW Group” includes “all the entities” and “everyone who is working for this brand” (doc. 59-1, Engelhorn dep. 75:3-11; see doc. 42-1 at 9).
Additionally, the plaintiff alleged that BMW AG's board of management comprises of executives from various disciplines (doc. 20, am. comp. ¶ 7). Each discipline is managed directly from Germany by a designated "circle," and the executives in these circles exercise common control over the various affiliates (id. ¶¶ 7, 16). HR is overseen by the P circle, which consists solely of German management employed by BMW AG (id. ¶ 16). The plaintiff asserted that promoting an employee to a Level IV, III, or II position in HR at BMW MC required approval from the P circle (doc. 45-1, plaintiff decl. ¶ 5). She attached to her declaration a policy regarding promotions for BMW MC, which she submitted was developed by BMW AG and provided that certain promotion decisions were "[s]ubject to the verification of the department circle" (id. ¶ 5 & exhibit A). The plaintiff also attached to her declaration an email from an employee at BMW AG instructing individuals at BMW MC to update their information because the P circle was going to discuss succession planning (id. ¶ 6 & exhibit B). The plaintiff testified that succession planning discussions occurred solely among members of the P circle (id.). Further, the plaintiff attached an email from the P circle that announced three topics of importance for the year for all affiliates under the control of the P circle (id. ¶ 6 & exhibit C). In addition, the plaintiff attached a BMW Group policy regarding assigning German employees to certain positions (doc. 46, BMW MC 231-247).
The plaintiff testified that towards the end of her employment, BMW AG directed a headcount reduction in HR in Greer (doc. 45-1, plaintiff decl. ¶ 18). BMW AG required her and others to submit information about their leadership positions, and then BMW AG told BMW MC a number of employees in each area that needed to be cut (id. ¶ 19). The plaintiff also testified that BMW AG would not let BMW MC customize systems, as BMW MC customized a certain system "for U.S. needs" and BMW AG told BMW MC that it "had to change back to the way that they do things in Germany" (id. ¶ 16). Further, BMW MC could not make its own organizational charts, as they were issued by BMW AG (id. ¶ 17). In addition, from time to time, BMW AG transferred some of its employees to BMW MC (docs. 20, am. compl. ¶ 10; 42-2, McCraw decl. ¶ 16). Ms. McCraw asserted that these transferred employees became BMW MC personnel whose duties and obligations, like other BMW MC personnel, were owed to BMW MC (doc. 42-2, McCraw decl. ¶ 16).
The plaintiff asserted that on or about September 15, 2021, Ms. Petrasch informed the plaintiff that she had met with Dr. Engelhorn and that BMW AG decided to replace Ms. Petrasch as the vice president of HR with Ms. McCraw, an American (doc. 20, am. compl. ¶ 42). The plaintiff alleged that Ms. Petrasch told her that BMW Group had a rule that if there is a domestic vice president, there must be a German next in line (id.). The plaintiff further alleged that Ms. Petrasch told her that the only way that a domestic employee could be the vice president of HR was to have a German employee in the TX-60 position "to be a bridge to Germany" (id. ¶ 43; doc. 46-2 at 2). The plaintiff asserted that Ms. Petrasch stated that she "[a]lready discussed w/T [and] P [and] it's done" (doc. 46-2 at 2). The plaintiff explained that "T" represents Milan Nedelijkovic, the head of manufacturing and a BMW AG board member, and "P" represents Ilka Horstmeier ("Ms. Horstmeier"), the head of personnel and a BMW AG board member (docs. 45-1, plaintiff decl. ¶ 7; 20, am. compl. ¶ 44). The plaintiff also alleged that Ms. Petrasch complained to the plaintiff that the executives from Germany called her on a Sunday about the decision (docs. 45-1, plaintiff decl. ¶ 3; 20, am. compl. ¶ 45).
The plaintiff alleged that on November 11,2021, Dr. Engelhorn, Ms. Petrasch, and Ms. McCraw met with the HR management in Greer to announce the changes (doc. 20, am. compl. ¶ 50). During the meeting, Ms. Petrasch stated that the plaintiff was being removed from TX-60 because a German needed to be put in that position since the vice president of HR was not German (id.). The plaintiff submitted that Dr. Engelhorn also stated that they needed an ex-pat on the team to have a connection with Munich since BMW AG controlled the finances (id.). Eva Burgmeier ("Ms. Burgmeier"), a German from BMW AG, was selected to fill the TX-60 position (id. ¶ 51).
The plaintiff testified that Ms. Petrasch repeatedly informed her that Germany told Ms. Petrasch "what the moves would be in human resources in Greer" (doc. 45-1, plaintiff decl. ¶ 4). At one point, both Ms. Petrasch and Dr. Engelhorn complained to the plaintiff that BMW AG was putting a German chief financial officer candidate on Dr. Engelhorn's calendar, even though Dr. Engelhorn did not want to interview that individual (id. ¶¶ 11-12). However, Dr. Engelhorn testified in his affidavit as follows:
4. As President and CEO of MC, I hold the ultimate authority over individual personnel decisions at MC, including whether individuals are hired by MC. From time to time, AG has recommended individuals to me for employment at MC, but I hold and exercise the ultimate authority over whether any individual is hired by MC.
5. In September 2021, I made the decision that Sherry McCraw, who was Vice President of Assembly at MC, should take over as Vice President of Human Resources at MC upon the departure of Christine Petrasch in early 2022.
6. On September 30 and October 1, 2021, I met with Ms. Petrasch and Ms. McCraw to discuss the reorganization of the Human Resources Department at MC. Ms. Petrasch's suggestion for the reorganization included moving [the plaintiff] from the TX-60 (compensation and benefits) role to the TX-61 (associate relations) role. Ms. McCraw disagreed with Ms. Petrasch's suggestion and instead recommended that Corey Epps remain in the TX-61 role and that [the plaintiff] move to the TX-64 (safety, health, wellness, recruiting) role. I agreed with Ms. McCraw's recommendation.(Doc. 52-1, Engelhorn aff. ¶¶ 4-6). Ms. McCraw also provided in her declaration that the president of BMW MC "retains the ultimate authority over individual personnel decisions at MC, including whether individuals are hired by MC" (doc. 42-2, McCraw decl. ¶ 15). Ms. McCraw further asserted that BMW MC personnel communicate with BMW AG personnel in the ordinary course of business, but decision-making authority on matters that concern BMW MC resides with BMW MC (id. ¶ 12). Moreover, Ms. McCraw stated that BMW MC's HR department, led by the vice president of HR, is responsible for, among other things, hiring, promoting, demoting, disciplining, and terminating the employment of BMW MC personnel (id. ¶ 13). Ms. McCraw stated that BMW MC has its own policies and procedures that are followed in making these determinations (id. ¶ 14).
In his deposition, Dr. Engelhorn testified that his meeting with Ms. McCraw and Ms. Petrasch was not the first time that he had a discussion with anyone about Ms. Burgmeier filling the TX-60 position (doc. 59-1, Engelhorn dep. 51:1-23). Rather, Dr. Engelhorn had previously spoken about this with individuals in Germany, including Ms. Barbara Burghardt ("Ms. Burghardt"), the head of HR in Germany, and Ms. Horstmeier, on more than one occasion (id.). Dr. Engelhorn thought that Ms. Burghardt was the first person to suggest Ms. Burgmeier for the TX-60 position (id. at 51:24-53:4). However, Dr. Engelhorn characterized the decision to move the plaintiff to a new position within HR as an "aligned agreement" between himself, Ms. Petrasch, and Ms. McCraw (doc. 61-1, Engelhorn dep. 23:1-16). Dr. Engelhorn also testified that "the decision how to set up the organization is finally with BMW MC" and that "I'm the president, and the responsibility, and therefore, for sure, we made the final decision" (id. at 60:10-15). However, Dr. Engelhorn noted that the decisions regarding succession plans for upper-level candidates is made by BMW AG (doc. 59-1, Engelhorn dep. 13:6-14:5). Further, Dr. Engelhorn testified that management in Germany is consulted because of the need for BMW MC "to align with [the] international production network" (id. at 60:20-61:2). Dr. Engelhorn also testified that the succession plan was discussed internally and he was in alignment with Germany in reaching the conclusion that Ms. Burgmeier was the best candidate for the TX-60 position (id. at 53:24-54:5). Dr. Engelhorn noted that Ms. Burgmeier had a "clear link" to Germany, which the local candidates did not have, and he expressed that it is "vital to have this close link" (id. at 53:24-54:13). When asked why it was important to have a close link to Germany in BMW MC's HR department, Dr. Engelhorn stated as follows:
Look, as I told you, BMW setup is a global setup. We have 10 fully-scaled plants. We have 30 plants all overall, and for us it's vital that we have a close link to the production network in terms of qualification, in terms of having the right international candidate in time, specifically also looking to the launches, to also have a clear view on the compensation and benefits side, to have a clear view towards business partners in Germany, BMW MC acting as a contract manufacturer for BMW, and these are the skills. ...
Look, what we discussed at BMW is a network companies. We have production facilities worldwide which need common alignment on training, or qualification, on setting up the right schemes and structures on common and agreed level worldwide because there is only one BMW quality, and we need to adhere all to the processes and the needs for car production. Therefore, knowing that the car engineered and designed in Munich, it is vital that we have one common language and understanding of the needs. In addition, what I can tell you about my personal experience, I have been four years to China, and in China, we had similar setup of the human resources department that at least one candidate, international candidate, have the strong link to Germany, and it worked perfect. I truly believe and am truly convinced that this is also, even then having one local domestic candidate as HRVP heading this operation, at least one close link is here in the 60 function. If it is independent, if it's domestic or whoever, we need the person with the skills, and the best one was Eva Burgmeier.(Id. at 54:14-56:10).
The plaintiff asserted that Ms. Petrasch told her that “they were considering moving her to different positions, but that the positions would be designated as Level IV” and produced a PowerPoint presentation showing a possible reorganization with the plaintiff being demoted to a Level IV position (doc. 20, am. compl. ¶ 56). The plaintiff alleged that after discussing a possible Level IV position, which the plaintiff was never actually offered, Ms. Petrasch began to encourage the plaintiff to look for positions outside of HR (id. ¶ 57). The plaintiff further alleged that Ms. Petrasch arranged for the plaintiff to interview for other positions in other departments, none of which involved HR or for which the plaintiff was likely the best candidate (id. ¶ 58). In contrast, the plaintiff submitted that she was informed that Corey Epps, a black male employed at Level IV, was promoted to Level III (id. ¶¶ 60, 76). The plaintiff alleged that she was never offered another position and was never promised one (id. ¶ 59). The plaintiff asserted that she began looking for positions outside of BMW because she had no offers at BMW and wished to continue her career in HR (id. ¶ 61). The plaintiff ultimately accepted an HR position at another company and resigned from BMW MC (id. ¶¶ 61-63). After the plaintiff resigned, Dr. Engelhorn requested a meeting with her because he wanted to understand why she resigned (doc. 61-1, Engelhorn dep. 87:2-13). Dr. Engelhorn testified that the plaintiff “did a good job” and he was “disappointed” that she resigned (id.).
The plaintiff filed an amended complaint on February 9, 2023, alleging claims against the defendants for national origin discrimination in violation of Title VII of the Civil Rights Act of 1964, as amended, ("Title VII"), race discrimination in violation of Title VII, race discrimination in violation of 42 U.S.C. 1981 ("Section 1981"), and sex discrimination in violation of Title VII (doc. 20). On March 6, 2023, BMW AG filed the instant motion to dismiss (doc. 42). The plaintiff filed a response on March 20, 2023 (doc. 45), and BMW AG filed a reply on March 31, 2023 (doc. 52). On May 8, 2023, the plaintiff filed an unopposed motion for leave to file a supplement in opposition to BMW AG's motion to dismiss based on newly acquired evidence (doc. 55). The undersigned granted the plaintiff's motion, providing that the plaintiff may file a supplement, to which BMW AG may file a responsive supplement (doc. 56). The plaintiff filed her supplement on May 22, 2023 (doc. 59), and BMW AG filed its responsive supplement on May 30, 2023 (doc. 61). Accordingly, this matter is now ripe for review.
II. APPLICABLE LAW AND ANALYSIS
A. Personal Jurisdiction
As set out above, BMW AG has moved to dismiss the plaintiff's complaint for lack of personal jurisdiction (doc. 42). "[W]hen, as here, a district court rules on a Rule 12(b)(2) motion without conducting an evidentiary hearing or without deferring ruling pending receipt at trial of evidence relevant to the jurisdictional issue, but rather relies on the complaint and affidavits alone, the burden on the plaintiff is simply to make a prima facie showing of sufficient jurisdictional basis in order to survive the jurisdictional challenge." In re Celotex Corp., 124 F.3d 619, 628 (4th Cir. 1997) (citation and internal quotation marks omitted). In deciding whether plaintiff has met this burden, "the court must construe all relevant pleading allegations in the light most favorable to the plaintiff, assume credibility, and draw the most favorable inferences for the existence of jurisdiction." Combs v. Bakker, 886 F.2d 676, 676 (4th Cir. 1989).
"[T]o validly assert personal jurisdiction over a non-resident defendant, two conditions must be satisfied." Christian Sci. Bd. of Dirs. of the First Church of Christ v. Nolan, 259 F.3d 209, 215 (4th Cir. 2001). First, the exercise of jurisdiction must be authorized by the long-arm statute of the forum state, and second, the exercise of personal jurisdiction must not "overstep the bounds" of the Fourteenth Amendment's Due Process Clause. Anita's N.M. Style Mexican Food, Inc. v. Anita's Mexican Foods Corp., 201 F.3d 314, 317 (4th Cir. 2000). South Carolina's long-arm statute has been construed to extend to the outer limits allowed by the Due Process Clause. Foster v. Arletty 3 Sarl, 278 F.3d 409, 414 (4th Cir. 2002). As a result, "the sole question becomes whether the exercise of personal jurisdiction would violate due process." Cockrell v. Hillerich & Bradsby Co., 611 S.E.2d 505, 508 (S.C. 2005) (internal citation omitted).
Due process requires the existence of minimum contacts between the defendant and the forum state such that maintenance of the suit does not offend traditional notions of "fair play and substantial justice." Burger King Corp. v. Rudzewicz, 471 U.S. 462, 464 (1985); see also Int'l Shoe Co. v. Wash., 326 U.S. 310, 316 (1945). A defendant has minimum contacts with a state when "the defendant's conduct and connection with the forum State are such that he should reasonably anticipate being haled into court there." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980) (internal citation omitted). Under this standard, "it 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." Hanson v. Denckla, 357 U.S. 235, 253 (1958) (citing Int'l Shoe Co., 326 U.S. at 319).
There are two categories of personal jurisdiction: (1) general, wherein a cause of action is unrelated to a defendant's contacts with the forum but the party's activities in the forum state have been found to be "continuous and systematic"; and (2) specific, wherein the cause of action arises out of a party's contacts with the forum state. See generally ESAB Group, Inc. v. Centricut, Inc., 126 F.3d 617, 623-24 (4th Cir. 1997). Here, the plaintiff notes that she is not arguing that the court should exercise general personal jurisdiction or jurisdiction based on vicarious liability, alter ego, or piercing the corporate veil (doc. 45 at 1, 17). Rather, the plaintiff only argues that BMW AG's direct contacts with South Carolina, through its substantial collaboration with BMW MC, are sufficient to warrant an exercise of specific personal jurisdiction (id. at 1, 17, 19-23). The Court of Appeals for the Fourth Circuit applies a three-part test when evaluating the propriety of exercising specific personal jurisdiction: (1) whether and to what extent the defendant purposely availed itself of the privileges of conducting activities in the forum state and thus invoked the benefits and protections of its laws; (2) whether the plaintiff's claims arise out of those forum-related activities; and (3) whether the exercise of jurisdiction is constitutionally "reasonable." Nolan, 259 F.3d at 215-16 (citing Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414-16 (1984)); Burger King, 471 U.S. at 472, 476-77).
1. Evidence
As an initial matter, the plaintiff argues that the court should not consider Ms. Kopnick and Ms. McCraw's declarations (doc. 45 at 14-15). The plaintiff asserts that Ms. Kopnick's declaration should be disregarded because she does not claim any personal knowledge about the decisions at issue (id. at 15). However, Ms. Kopnick did not provide statements about the personnel decisions at issue but rather testified regarding the structure of BMW AG, BMW AG's lack of contacts with South Carolina, and the relationship between BMW AG and BMW MC (see doc. 42-3, Kopnick decl. ¶¶ 5-20). Accordingly, the undersigned has considered her declaration herein. The plaintiff similarly argues that Ms. McCraw's declaration should not be considered because Ms. McCraw was not involved in the decisionmaking at issue, she was not employed in HR during the plaintiff's employment, she did not claim involvement in the communications on which the plaintiff relies, and she did not address the policy regarding filling positions based on nationality (doc. 45 at 14-15). However, again, Ms. McCraw did not provide statements in her declaration about the personnel decisions at issue (see doc. 42-2, McCraw decl. ¶¶ 1-18). Rather, Ms. McCraw provided testimony regarding BMW MC, its organizational structure, and BMW MC's authority to control its functions, including HR functions (id.). Therefore, the undersigned finds that the plaintiff's arguments are without merit.
In addition, BMW AG argues that the court should not consider the plaintiff's depiction of Ms. Petrasch's statements, which it contends are inadmissible hearsay, speculation, and contradicted by Dr. Engelhorn and Ms. McCraw's declarations (doc. 52 at 9-10). However, the Fourth Circuit has rejected a similar argument, stating as follows:
Koro also urges us to reject as inadmissible hearsay Kochekian's statements regarding in-person solicitations by Koro employees, which Koro's representative contradicted in opposing declarations.
At the outset, we find no merit in Koro's attempt at this stage of proceedings to discredit the facts adduced in the affidavits filed by Universal. Because the district court did not conduct an evidentiary hearing, the court was required to assume the credibility of Universal's version of the facts, and to construe any conflicting facts in the parties' affidavits and declarations in the light most favorable to Universal. See, e.g., Carefirst of Md., Inc. v. Carefirst Pregnancy Ctrs., Inc., 334 F.3d 390, 396 (4th Cir.2003) (stating that absent an evidentiary hearing, the district court “must take all disputed facts and reasonable inferences in favor of the plaintiff” in determining whether the plaintiff has met its initial burden of proof with regard to personal jurisdiction) (citing Combs, 886 F.2d at 676); O'Hare Int'l Bank v. Hampton, 437 F.2d 1173, 1176-77 (7th Cir.1971) (accepting as true, for purposes of appeal, facts related in the plaintiff's affidavits and complaint when the parties' affidavits contained contradictory factual allegations with respect to personal jurisdiction); cf. Dowless v. Warren-Rupp Houdailles, Inc.,
800 F.2d 1305, 1307-08 (4th Cir.1986) (noting that the plaintiff “need not present evidence in making a prima facie case to oppose a motion to dismiss,” and that “[m]ere allegations are sufficient” to satisfy the pleading requirements for personal jurisdiction).
Given the procedural posture of this appeal, we do not evaluate the credibility of the statements in affidavits filed on Universal's behalf or address any questions regarding the ultimate admissibility of evidence, nor do we decide whether Universal has proved its contentions. Instead, we are required to determine whether Universal has made at the motion to dismiss stage a prima facie showing that Koro purposefully availed itself of the privilege of doing business in North Carolina, in satisfaction of the first prong of our jurisdictional analysis. See, e.g., Carefirst, 334 F.3d at 396 (stating that when the district court decides a pretrial motion challenging personal jurisdiction without conducting an evidentiary hearing, the plaintiff need only make a prima facie showing of jurisdiction); Mattel, Inc. v. Greiner & Hausser GmbH, 354 F.3d 857, 862 (9th Cir.2003) (stating that a plaintiff makes a prima facie showing of personal jurisdiction by presenting facts that, if true, would support jurisdiction over the defendant).Universal Leather, LLC v. Koro AR, S.A., 773 F.3d 553, 560-61 (4th Cir. 2014).
Accordingly, the undersigned has considered the plaintiff's allegations of Ms. Petrasch's statements herein.
2. Purposeful Availment
The first prong under the test used to evaluate specific personal jurisdiction "is grounded on the traditional due process concept of 'minimum contacts,' which itself is based on the premise that 'a corporation that enjoys the privilege of conducting business within a state bears the reciprocal obligation of answering to legal proceedings there." Universal Leather, 773 F.3d at 559 (quoting Tire Eng'g v. Shandong Linglong Rubber Co., 682 F.3d 292, 301 (4th Cir. 2012)). This prong "ensures that a defendant will not be haled into a jurisdiction solely as a result of random, fortuitous, or attenuated contacts," or due to "the unilateral activity of another party or a third person." Burger King, 471 U.S. at 475 (internal citations and quotation marks omitted). "In determining whether a foreign defendant has purposefully availed itself of the privilege of conducting business in a forum state, we ask whether the defendant's conduct and connection with the forum [s]tate are such that he should reasonably anticipate being haled into court there." Universal Leather, 773 F.3d at 559-60 (citations and internal quotation marks omitted). "The purposeful-availment prong is not susceptible to a mechanical application and requires a court to consider a list of various nonexclusive factors[,]" including:
(1) whether the defendant maintained offices or agents in the State; (2) whether the defendant maintained property in the State; (3) whether the defendant reached into the State to solicit or initiate business; (4) whether the defendant deliberately engaged in significant or long-term business activities in the State; (5) whether a choice of law clause selects the law of the State; (6) whether the defendant made in-person contact with a resident of the State regarding the business relationship; (7) whether the relevant contracts required performance of duties in the State; and (8) the nature, quality, and extent of the parties' communications about the business being transacted.dmarcian, Inc. v. dmarcian Eur. BV, 60 F.4th 119, 133 (4th Cir. 2023). The Fourth Circuit "generally ha[s] concluded that a foreign defendant has purposefully availed itself of the privilege of conducting business in the forum state when the defendant substantially collaborated with a forum resident and that joint enterprise constituted an integral element of the dispute." Universal Leather, 773 F.3d at 560 (citation and internal quotation marks omitted).
While BMW AG does not have offices or agents, own property, or have a license or registration to conduct business in South Carolina, there is evidence of BMW AG purposefully availing itself of the privilege of conducting business in the state through its substantial collaboration with BMW MC. As set out above, the plaintiff conversed with employees at BMW AG on a weekly basis, and she had to obtain BMW AG's approval for changes in benefits, salary structure, bonuses, and management structure at BMW MC. Further, there is evidence that the P circle, which was comprised solely of management at BMW AG, oversaw some of the HR operations in Greer. For example, the P circle conducted succession planning for BMW MC employees, and the P circle's approval was required to promote an employee to a Level IV, III, or II position in HR at BMW MC. The plaintiff also testified that BMW AG directed a headcount reduction at BMW MC and specified a number of employees in each area that needed to be cut. There have also been overlapping employees, with employees transferring from BMW AG to BMW MC, and vice versa. Moreover, although Dr. Engelhorn provided that the ultimate employment decisions were his responsibility, there is evidence that BMW AG was involved in removing the plaintiff from the TX-60 position pursuant to a BMW Group policy about filling positions based on nationality, filling that role with a German employee at BMW AG, and selecting Ms. Burgmeier as the plaintiff's replacement. Taking this together, these contacts cannot be described as random or fortuitous, but rather, as coordinated and purposefully maintained. Accordingly, construing all relevant pleading allegations in the light most favorable to the plaintiff, assuming credibility, and drawing the most favorable inferences for the existence of jurisdiction, the undersigned finds that the nature and level of BMW AG's contacts with South Carolina are sufficient to establish purposeful availment at this stage. See e.g., Agracel, Inc. v. STS Grp. N. Am. Inc., C/A No. 6:22-3203-HMH, 2023 WL 3549310, at *6 (D.S.C. May 18, 2023) ("Agracel has submitted prima facie evidence that Defendants collaborated extensively with Agracel representatives in South Carolina, as evidenced by the multiple in-person visits that Defendants' agents or apparent agents made to Greenville, South Carolina in connection with the Project.") (citing Grayson Consulting, Inc. v. Cathcart, C/A No. 2:07-CV-00593-DCN, 2013 WL 6490175, at *5 (D.S.C. Dec. 10, 2013) (finding purposeful availment where, even though the defendant "maintained] neither an office nor an agent in South Carolina and own[ed] no property in the state," it "frequently corresponded" with a South Carolina-based accountant "regarding business transactions ... implicated in [the] litigation," traveled to South Carolina to meet with the accountant, and communicated directly with executives of the company for which he worked)); Gourdine v. Karl Storz Endoscopy-Am., Inc., 223 F.Supp.3d 475, 487-90 (D.S.C. 2016) (discussing a parent manufacturer's direct contacts with a forum in the context of a stream of commerce theory); compare Consulting Eng'rs Corp. v. Geometric Ltd., 561 F.3d 273, 281-82 (4th Cir. 2009) (finding no purposeful availment for one defendant when it maintained no offices in Virginia, none of its employees had ever traveled there, the activity complained of took place in India, the alleged conspiracy was hatched outside of the forum state, and the defendant only exchanged four brief emails and had several phone conversations with the Virginia-based plaintiff about contractual negotiations); Foster, 278 F.3d at 415-16 (finding no purposeful availment and noting that given France's centrality to the case, "some fleeting communication by telephone and fax" between the plaintiff and defendants while the plaintiff was in South Carolina was "insufficient, standing alone, to establish jurisdiction").
3. The Basis of the Plaintiff's Claims
The second prong, whether the plaintiff's claims arise out of those forum-related activities, "requires that the defendant's contacts with the forum state form the basis of the suit." Consulting Eng'rs, 561 F.3d at 278-79 (citations omitted). "[T]here must be an affiliation between the forum and the underlying controversy, principally, [an] activity or an occurrence that takes place in the forum State." Wallace v. Yamaha Motors Corp., U.S.A., C/A No. 19-2459, 2022 WL 61430, at *3 (4th Cir. Jan. 6, 2022) (citations and internal quotation marks omitted). "When there is no such connection, specific jurisdiction is lacking regardless of the extent of a defendant's unconnected activities in the State." Id. (citations and internal quotation marks omitted). This prong "is easily satisfied" when "activity in the forum state is the genesis of [the] dispute." Tire Eng'g, 682 F.3d at 303 (citation and internal quotation marks omitted). "A plaintiff's claims similarly arise out of activities directed at the forum state if substantial correspondence and collaboration between the parties, one of which is based in the forum state, forms an important part of the claim." Id. (citation omitted).
Here, the plaintiff alleged that Ms. Petrasch informed her that individuals in Germany made the decision to remove the plaintiff from the TX-60 position and fill that position with a German based on a BMW Group policy. Moreover, the plaintiff testified that individuals from Germany called Ms. Petrasch with the decision. Further, Dr. Engelhorn testified that he talked with individuals in Germany on more than one occasion about Ms. Burgmeier filling the TX-60 position. Dr. Engelhorn also recognized that the head of HR in Germany first suggested Ms. Burgmeier for the position. Moreover, Dr. Engelhorn consulted management in Germany about this decision because of the need for BMW MC "to align with [the] international production network." Based on the foregoing, the undersigned finds that the plaintiff has met her burden of showing that her claims arose out of BMW AG's forum-related activities sufficient to survive BMW AG's motion to dismiss.
4. Constitutional Reasonableness
The third prong, whether the exercise of jurisdiction is constitutionally reasonable, "permits a court to consider additional factors to ensure the appropriateness of the forum once it has determined that a defendant has purposefully availed itself of the privilege of doing business there." dmarcian, 60 F.4th at 135 (citation and internal quotation marks omitted). "This final prong considers factors such as the burden on the defendant, the court's ability to conveniently and efficiently resolve the dispute, the interest of the forum state in adjudicating the dispute, the plaintiff's interest in obtaining effective relief, and the interests of the state in furthering substantive policies." Id. (citation omitted). "The reasonableness inquiry makes sure that litigation is not so gravely difficult and inconvenient as to place the defendant at a severe disadvantage in comparison to his opponent." Id. (citation and internal quotation marks omitted). "Importantly, a corporate defendant's domicile abroad, standing alone, does not render domestic exercise of jurisdiction unduly burdensome." Id. (citation and internal quotation marks omitted).
The undersigned finds that, based on the record before the court, BMW AG litigating in South Carolina would not be unduly burdensome. BMW AG engaged with BMW MC in South Carolina regularly. Further, South Carolina has an interest in this litigation given that BMW MC is located in Greer and the plaintiff's employment occurred there. Therefore, the undersigned finds that the plaintiff has pled a prima facie case sufficient for the court to exercise jurisdiction over BMW AG at this stage of the litigation and recommends that the district court deny BMW AG's motion to dismiss.
Because the undersigned recommends that the district court find that the plaintiff has made a prima facie showing of specific personal jurisdiction over BMW AG, the plaintiff's arguments regarding an exercise of jurisdiction pursuant to Federal Rule of Civil Procedure 4(k)(2) will not be addressed (see doc. 45 at 23-24).
III. CONCLUSION AND RECOMMENDATION
Wherefore, based upon the foregoing, the undersigned recommends that the district court deny BMW AG's motion to dismiss (doc. 42).
IT IS SO RECOMMENDED.
The attention of the parties is directed to the important notice on the next page.
Notice of Right to File Objections to Report and Recommendation
The parties are advised that they may file specific written objections to this Report and Recommendation with the District Judge. Objections must specifically identify the portions of the Report and Recommendation to which objections are made and the basis for such objections. “[I]n the absence of a timely filed objection, a district court need not conduct a de novo review, but instead must ‘only satisfy itself that there is no clear error on the face of the record in order to accept the recommendation.'” Diamond v. Colonial Life & Acc. Ins. Co., 416 F.3d 310 (4th Cir. 2005) (quoting Fed.R.Civ.P. 72 advisory committee's note).
Specific written objections must be filed within fourteen (14) days of the date of service of this Report and Recommendation. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72(b); see Fed.R.Civ.P. 6(a), (d). Filing by mail pursuant to Federal Rule of Civil Procedure 5 may be accomplished by mailing objections to:
Robin L. Blume, Clerk United States District Court 250 East North Street, Suite 2300 Greenville, South Carolina 29601
Failure to timely file specific written objections to this Report and Recommendation will result in waiver of the right to appeal from a judgment of the District Court based upon such Recommendation. 28 U.S.C. § 636(b)(1); Thomas v. Arn, 474 U.S. 140 (1985); Wright v. Collins, 766 F.2d 841 (4th Cir. 1985); United States v. Schronce, 727 F.2d 91 (4th Cir. 1984).