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AK Steel Corp. v. PAC Operating Limited Partnership

United States District Court, D. Kansas

August 3, 2017

AK STEEL CORPORATION, Plaintiff
v.
PAC OPERATING LIMITED PARTNERSHIP and PALMTREE ACQUISITION CORPORATION, Defendants/Crossclaim Plaintiffs/Third-Party Plaintiffs,
v.
CONTECH ENGINEERED SOLUTIONS, LLC, ARKEMA, INC., HENKEL CORPORATION, and DIAL CORPORATION, Third-Party Defendants

          MEMORANDUM AND ORDER

          CARLOS MURGUIA United States District Judge.

         This matter is before the court on third-party defendant Henkel Corporation's (defendant) motion to dismiss third-party plaintiff PAC Operating Limited Partnership and Palmtree Acquisition Corporation's (collectively, plaintiff) complaint for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2). (Doc. 68.) For the reasons set forth below, the court denies defendant's motion to dismiss for lack of personal jurisdiction.

         I. Factual Background

         Viewed in the light most favorable to plaintiff, the complaint and the record evidence are summarized as follows:

         AK Steel Corporation (AK Steel) filed suit against plaintiff under the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (“CERCLA”) for environmental response costs associated with the property 2707 Northeast Seward Avenue in Topeka, Kansas (the Site). AK Steel alleges that plaintiff's predecessor owned the Site and leased it to Turco Products, Inc. (Old Turco) from January 1, 1955 to January 1, 1958, and that Old Turco's operations contaminated the Site. Old Turco allegedly manufactured emulsion cleaner used by the United States Air Force to clean aircraft, and may have also repackaged paint removers for use by the Air Force. AK Steel also alleges that Old Turco's operations contaminated the Site.

         Old Turco merged with Purex Corporation on December 31, 1960. Purex Industries, Inc. acquired Purex Corporation and became incorporated in Delaware in 1978. In 1985, Pennwalt Corporation purchased Purex Industries. Pennwalt changed its name to Atochem North America in 1989, then became Elf Atochem in 1992, before finally changing its name to Atofina Chemicals, Inc. (“Atofina”) in 2000. In 2001, defendant entered into an Asset Purchase and Sale Agreement with Atofina where defendant acquired Atofina's metals and aviation business. Defendant also acquired certain assets from an Atofina subsidiary called Turco Products, Inc. (New Turco). New Turco was incorporated in Delaware in 1985. Defendant acquired the trademark and name of New Turco, but Atofina retained ownership of the subsidiary.

         Plaintiff filed this third-party complaint against defendant pursuant to Section 113(f) of CERCLA, seeking contribution for any environmental response costs or damages adjudged against them. (Doc. 26) Plaintiff alleges that defendant is liable under Section 113(f) as a successor corporation to Old Turco. Defendant brought a motion to strike plaintiff's third-party complaint under Rule 14(a)(1) of the Federal Rules of Civil Procedure on August 16, 2016. (Doc. 32.) Magistrate Judge Birzer denied that motion on October 24, 2016. (Doc. 63.) Defendant then filed this motion to dismiss for lack of personal jurisdiction under Rule 12(b)(2) of the Federal Rules of Civil Procedure. (Doc. 68.)

         Defendant is a Delaware corporation formed on January 22, 1970, with its principal place of place of business in Connecticut. Defendant does not have an office, phone number, bank account, or mailing address in Kansas. Defendant does not own any real property in Kansas, and it does not have any employees in Kansas. Approximately 2% of defendant's annual sales are from Kansas. Pursuant to Kansas law, defendant is registered to conduct business in Kansas. Plaintiff is a Delaware corporation headquartered in California.

         II. Legal Standard

         A. Motions to Dismiss under Fed.R.Civ.P. 12(b)(2)

         A defendant may assert a pre-answer personal jurisdictional defense by motion. Fed.R.Civ.P. 12(b)(2). Plaintiff bears the burden of establishing personal jurisdiction over each defendant. OMI Holdings, Inc. v. Royal Ins. Co. of Canada, 149 F.3d 1086, 1091 (10th Cir. 1998). When, as here, the court exercises its discretion to decide defendant's dismissal motion without conducting an evidentiary hearing, plaintiff need only make a prima facie showing of personal jurisdiction. Id. at 1091. To do so, plaintiff may establish facts via affidavits or other written materials that, if true, would support asserting personal jurisdiction. Id. The court assumes the allegations in the complaint are true to the extent they are not controverted, and resolves all factual disputes in plaintiff's favor. Shrader v. Biddinger, 633 F.3d 1235, 1239 (10th Cir. 2011).

         III. Discussion - Personal Jurisdiction

         Defendant argues the third-party complaint should be dismissed for lack of personal jurisdiction. In analyzing personal jurisdiction, the district court must determine: (1) whether the defendant's conduct falls within the forum state's long-arm statute, and (2) whether the exercise of personal jurisdiction over the defendant satisfies the constitutional guarantee of due process. Trujillo v. Williams, 465 F.3d 1210, 1217 (10th Cir. 2006). Because Kansas construes its long-arm statute to the same limits allowed by federal due process, the court proceeds directly to the constitutional due process inquiry. OMI Holdings, 149 F.3d at 1090; Kan. Stat. Ann. § 60-308(b)(1)(L)-(b)(2). Analyzing due process is a two-step process. First, the court must find that the defendant has “minimum contacts” with the forum state such that the defendant “should reasonably anticipate being haled into court there.” World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 287 (1980). Second, the defendant's contacts with the forum must be such “that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Asahi Metal Indus. Co. v. Superior Court, 480 U.S. 102, 113 (1987).

         A. ...


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