Eleven Foreign Corporation Employees Working in United States Through Secondment Agreements are “Insufficient Contacts” for Jurisdiction

11 Foreign Corporation Employees Working in United States Through Secondment Agreements are “Insufficient Contacts” for Jurisdiction

By: Nick Bergeron

Patterson v. Aker Solutions Inc., 2016 U.S. App. LEXIS 10701, No. 15-30690, 2016 WL 3254605, *1 (5th Cir. 2016)

Appeals from the United States District Court for the Eastern District of Louisiana

In a recent opinion by the United States Fifth Circuit Court of Appeals, the court found that a foreign corporation Aker Subsea AS (“Aker Subsea”) did not have sufficient contacts with the United States such that a court could exercise general personal jurisdiction in a personal injury suit. The suit arose from an injury sustained by a U.S. citizen working on the M/V SIMON STEVIN, a Luxembourg-flagged vessel located off the coast of Russia. The plaintiff sued two companies but later amended his complaint and added, among others, Aker Subsea, which moved to dismiss for lack of personal jurisdiction. The district court granted the motion; and, after the district court certified its judgment of dismissal under FRCP 54(b), the Fifth Circuit affirmed.[1]The plaintiff argued that Aker Subsea had sufficient contacts with the United States to establish general personal jurisdiction because, over a three-year period, Aker Subsea entered into eleven secondment agreements[2] whereby it would assign its employees to an American affiliate in Houston, Texas without removing them from employment by Aker Subsea. The court found these contacts insufficient to establish general personal jurisdiction. It reasoned that the corporation’s contacts must be continuous and systematic in such a way that the foreign corporation’s affiliation with the state renders it essentially at home in that forum.In that regard, the court recognized the lack of evidence in the record indicating a significant presence in the United States such that it would render Aker Subsea subject to the jurisdiction of the court. The Fifth Circuit specifically pointed to the lack of participation in litigation, advertising, marketing, maintenance of assets, and regularly conducted business within the United States other than those eleven secondment assignments in Houston. In addition, the fact that the corporation’s place of incorporation and principal place of business are both in Norway further supported its decision to affirm the district court’s dismissal for lack of general personal jurisdiction.  [1] It should be noted that the plaintiff simultaneously appealed and moved for certification under FRCP 54(b). The Fifth Circuit stayed the appeal until the district court certified its judgment.[2] The term secondment means “the detachment of a person ... from his regular organization for temporary assignment elsewhere.” Webster's Third New Int'l Dictionary (10th ed. 2014). Here, the secondment agreements sent workers from Aker Subsea in Norway to Aker Solutions, an affiliate, in Houston. Aker Subsea would maintain all of the benefits of the seconded employee in Norway, including Norwegian Social Security, home country pension, and insurance. Aker Solutions was responsible for the day-to-day instruction of the seconded employee. Patterson, 2016 WL 3254605, at *2 n.3.