Opinion
Case No. CV 08-03944 DDP (AGRx).
September 23, 2008
ORDER GRANTING DEFENDANT FUJI FIRE MARINE INSURANCE CO., LTD.'S MOTION TO DISMISS [Motion filed on July 28, 2008]
This matter comes before the Court on Defendant Fuji Fire Marine Insurance Co. Ltd.'s ("Fuji") Motion to Dismiss Plaintiff's complaint for (1) lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(2); (2) improper venue (forum non conveniens) pursuant to Rule 12(b)(3); and insufficient service of process pursuant to Rule 12(b)(5). After reviewing the materials submitted by the parties and hearing oral argument, the Court grants the motion to dismiss for lack of personal jurisdiction.
I. BACKGROUND
Plaintiff Andrea Good ("Good") is a United States citizen who has been living and working in Japan, where she resides with her husband, a Japanese citizen, and children. Compl. at 4. She also alleges that she has resided in Santa Fe, New Mexico during period relevant to this lawsuit. Id. All of the defendants in this action, including the moving party in this motion, are domiciled or centered in Japan. Fuji is a Japanese corporation engaged in the insurance business.
While in Japan, Good and her husband were injured in a car accident. Id. at 4. The police report found that the other driver, Defendant Takaya Hanada, was responsible for the crash.Id. at 5. Hanada's insurance company, Defendant Fuji, initially denied that it insured Hanada, but corrected its information one week later. Id. at 5-6. After Hanada filed suit in Japanese court seeking declaratory judgment, Good and her husband cross-complained and litigated fault for the accident in Japan. Both Good and her husband were awarded monetary damages in that action, but they appeal the judgment there. Fujiwara Decl. ¶ 2.
Good, appearing pro se, subsequently filed this suit. Her complaint seeks relief for the actions of the various defendants in the aftermath of the accident as she sought compensation for her personal and property injuries. She asserts claims for fraud and negligent misrepresentation, malicious prosecution and conspiracy to commit malicious prosecution, and intentional and negligent infliction of emotional distress. Good seeks compensatory damages not less than $1.5 million, punitive damages not less than $10 million, and an order that Fuji's business be suspended.
In this motion, Fuji moves to dismiss the case on three alternative grounds pursuant to Federal Rule of Civil Procedure 12(b). First, Fuji argues that this Court lacks personal jurisdiction over it. Fed.R.Civ.P. 12(b)(2). Second, Fuji argues that this case should be dismissed on forum non conveniens grounds. Fed.R.Civ.P. 12(b)(3). And third, Fuji argues that the court should dismiss the complaint for lack of proper service of process.
The Court does not find it necessary to reach this third ground. During oral argument, however, the plaintiff argued that Fuji had conceded jurisdiction or waived service of process by making its motion to dismiss and appearing in court. Because Fuji appeared only for the limited purpose of making its motion to dismiss for lack of personal jurisdiction, forum non conveniens, and improper service, Fuji did not waive these issues. See, e.g.,Lewellen v. Morley, 909 F.2d 1073, 1077 (7th Cir. 1990). See also Federal Rule of Civil Procedure 12(h).
II. DISCUSSION
A. Personal Jurisdiction
1. Legal Standard
Federal Rule of Civil Procedure 12(b)(2) provides that a court may dismiss a suit for lack of personal jurisdiction. "When a defendant moves to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of demonstrating that the court has jurisdiction over the defendant." Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1154 (9th Cir. 2006). "When a district court acts on a motion to dismiss without holding an evidentiary hearing, the plaintiff need only make a prima facie showing of jurisdictional facts to withstand the motion." Doe v. Unocal Corp., 248 F.3d 915, 922 (9th Cir. 2001). A district court may rely on affidavits submitted by the parties. Id. A court takes a plaintiff's uncontroverted version of the facts as true for these purposes.Id. "Likewise, conflicts between the facts contained in the parties' affidavits must be resolved in plaintiffs' favor for the purposes of deciding whether a prima facie case for personal jurisdiction exists." Id. (internal quotation marks and brackets omitted).
2. Substantive Personal Jurisdiction Standard
Courts have the power to exercise personal jurisdiction to the extent authorized by the state in which they sit. Whether the exercise of personal jurisdiction is appropriate requires a determination that state law allows personal jurisdiction (through its long-arm statute) and that due process requirements have been met. Sinatra v. Nat'l Enquirer, Inc., 854 F.2d 1191, 1194 (9th Cir. 1988). Because California's long-arm statute authorizes personal jurisdiction coextensive with the Due Process Clause of the United States Constitution, see Cal. Civ. Code § 410.10, this Court need only determine whether the exercise of personal jurisdiction over Fuji satisfies that standard.
Constitutional due process turns on whether the defendants' contacts with the forum state are of such a quality and nature that the defendants could reasonably expect "being haled into court there." World-Wide Volkswagen v. Woodson, 444 U.S. 286, 297 (1980). Due process is satisfied "when in personam jurisdiction is asserted over a non-resident corporate defendant that has certain minimum contacts with [the forum] such that maintenance of the suit does not offend traditional notions of fair play and substantial justice." Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 (1984) (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 326 (1945).
3. Minimum Contacts
In applying the minimum contacts test for personal jurisdiction, a court may obtain either general or specific jurisdiction.
a. General Jurisdiction
A non-resident defendant is subject to general jurisdiction in a forum if the defendant has engaged in "substantial" or "continuous and systematic" contacts with the state. Bancroft Masters, Inc. v. Augusta Nat. Inc., 223 F.3d 1082, 1086 (9th Cir. 2000). Where general jurisdiction is present, a non-resident defendant "can be haled into court in that state in any action, even if the action is unrelated to those contacts." Id.
In asserting that personal jurisdiction exists, Good primarily relies on the presence of an American Fuji Office in Los Angeles.See Opp. at Ex. A (Fuji Fire Marine Ins. Co., Ltd. 2006 Annual Report p. 38). Fuji's 2006 Annual Report lists a "Representative Office" in Los Angeles, "c/o American Fuji." Id. American Fuji is a wholly-owned subsidiary of Fuji Fire. Hasuike Decl. ¶ 3. American Fuji has been authorized to transact business with the State of California since 1991, and its business in California consisted primarily of writing insurance policies. Id. at ¶ 5.
By virtue of its office in Los Angeles and business conducted in California, American Fuji may have sufficient contacts with California to be subject to personal jurisdiction. American Fuji's contacts are not automatically imputed to Fuji, however. "It is well-established that a parent-subsidiary relationship alone is insufficient to attribute the contacts of the subsidiary to the parent for jurisdictional purposes." Harris Rutsky Co. Ins. Servs., Inc. v. Bell Clements Ltd., 328 F.3d 1122, 1134 (9th Cir. 2003). Rather, the general rule is that a parent and subsidiary are separate entities. Id. There are two exceptions to this general rule, however: "a subsidiary's contacts may be imputed to the parent where the subsidiary is the parent's alter ego, or where the subsidiary acts as the general agent of the parent." Id.
To satisfy the alter ego exception, Good must make out a prima facie case that (1) Fuji and American Fuji have such a unity of interest and ownership that the separate personalities no longer exits and (2) the failure to disregard their separate identities would result in fraud or injustice. Id. (citing Doe, 248 F.3d at 926). To satisfy the agency test, Good must make a prima facie showing that American Fuji represents Fuji "by performing services sufficiently important to [Fuji] that if it did not have a representative to perform them, [Fuji] would undertake to perform substantially similar services." Id.
Good does not make a showing on either exception. Rather, the evidence before the Court as to the relationship between Fuji and American Fuji counsels to the contrary. Although American Fuji is a wholly owned subsidiary of Fuji Fire, the two companies maintain distinct corporate identities. Hasuike Decl. ¶ 3. The relationship between the two companies is governed by contract, whereby American Fuji performs some services for Fuji's Japanese customers while they are in the United States, and pays American Fuji for those services. Hasuike Decl. Ex. A. The contract governing the two companies' relationship provides that the "services to be provided by American Fuji shall be limited to the services set forth above. The parties hereby agree that American Fuji shall not solicit business, issue policies, settle claims, conclude contracts, or make business decisions on behalf of Fuji Fire."Id. at 1-2. Even liberally construing the facts suggested by 2006 Annual Report excerpt in Good's favor, the list of Fuji Representative Offices is not enough to make out a prima facie case of either alter ego status or agency. Accordingly, there are not minimum contacts sufficient to give rise to personal jurisdiction here.
b. Specific Jurisdiction
Where a defendant does not have "systematic and continuous" contacts with a forum state to establish general jurisdiction, a non-resident defendant's contacts with the forum state may still provide a basis for specific jurisdiction. Specific jurisdiction requires a plaintiff show that (1) the non-resident defendant purposefully directed its activities at forum residents or purposefully avails itself of the privilege of conducting activities in the forum; (2) the claim arose out of or resulted from the non-resident defendant's forum-related activities; and (3) the exercise of jurisdiction is reasonable. Bancroft Masters, Inc. v. Augusta Nat'l Inc., 233 F.3d 1082, 1086 (9th Cir. 2000).
Specific jurisdiction is not available here. Even if the Court were to assume that Fuji purposefully availed itself of California through its relationship with its subsidiary, American Fuji, plaintiff in no way alleges that any of the actions at issue in her suit arose out of, or have a "substantial connection" to that activity. See Hanson v. Denckla, 357 U.S. 235, 250-53 (1958).
B. Forum non conveniens
Having found that it does not have personal jurisdiction over Fuji, the Court need not consider Fuji's other defenses. However, even if it has personal jurisdiction over Fuji, the complaint should be dismissed for improper venue.
1. Legal Standard for Forum Non Conveniens
A court may grant a motion to dismiss on forum non conveniens if the moving party shows (1) that there is an adequate alternative forum and (2) that the balance of private and public interest factors favor dismissal. Dole, 303 F.3d at 1118.
2. Adequate Alternative Forum
An adequate alternative forum exists when defendants are amenable to service in the foreign forum and provides the plaintiff with a sufficient remedy for the defendant's wrong. Id. Whether the alternative forum's substantive law is less favorable to the plaintiff than her chosen forum is usually irrelevant to the determination of an adequate alternative forum. Piper Aircraft Co. v. Reyno, 454 U.S. 235, 254 (1981). To be inadequate, the remedy must be "clearly unsatisfactory," such as where the forum does not permit litigation on the subject matter in dispute. Id. at n. 22; see Lueck v. Sundstrand Corp., 236 F.3d 1137, 1144 (9th Cir. 2001). Procedural differences are not enough to make the alternative forum inadequate. Lockman Found. v. Evangelical Alliance Mission, 930 F.2d 764, 768 (9th Cir. 1991).
Here, Fuji has established that Japan is an adequate alternative forum. Fuji is amenable to service of process in Japan; indeed, it has already engaged in litigation with Good in that forum. Additionally, Good can bring her post-accident claims in Japan, under Japanese law. Fujiwara Decl. ¶¶ 4-5. Cf. Lockman, 930 F.2d at 769 n. 8.
3. Convenience Factors
Fuji has also shown that the private and public interest factors balance heavily in favor of Japan as the appropriate forum for this action. The private interest factors include (1) the relative ease of access to sources of proof; (2) the availability of compulsory process; and (3) practical issues "that make trial of a case easy, expeditious, and inexpensive."Piper Aircraft, 454 U.S. at 241 n. 6. Public interest factors include (1) judicial efficiency; (2) local interest in having local controversies decided at home; (3) the unfairness of burdening citizens in an unrelated forum with jury duty; and (4) the interest in having the trial of a diversity case in a forum that is at home with the law that must govern the action. Id.
Here, the convenience factors point overwhelmingly in favor of the alternative forum. With regard to private interest factors, all of the witnesses and evidence regarding the Fuji conduct at issue in this case is located in Japan. Yoshida Decl. ¶ 8. The entirety of the events at issue in this case occurred in Japan. Compl. at 4-12. With regard to public interest factors, the interests of California citizens in deciding this case are minimal, and the burden on the Court and the potential jurors of litigating the case with foreign witnesses, evidence, and insurance law, would be great.
Accordingly, even giving the plaintiff's choice of forum deference, the "balance of conveniences suggests that trial in the chosen forum would be unnecessarily burdensome" for both Fuji and the Court. Contact Lumber Co. v. P.T. Moges Shipping Co., Ltd., 918 F.2d 1446, 1449 (9th Cir. 1990).
III. CONCLUSION
For the foregoing reasons, the Court grants Fuji's motion to dismiss for lack of personal jurisdiction. Alternatively, the Court grants Fuji's motion on forum non conveniens grounds.
IT IS SO ORDERED.