Court Addresses Aspects of Personal Jurisdiction under FRCP Rule 15(c) and Jones Act Statute of Limitations

Court Addresses Aspects of Personal Jurisdiction under FRCP Rule 15(c) and Jones Act Statute of Limitations

By: Alexandra Saliba

Kelan Unterberg v. Mobil Shipping & Transp. Co., No. 14 Civ. 10025 (GBD), 2017 U.S. Dist. LEXIS 154661; 2017 WL 4326040 (S.D.N.Y. Sept. 20, 2017).Mr. Jurgen Unterberg was a German engineering officer employed by Mobil Shipping and Transportation Company (“MOSAT”), and worked on six tankers from 1973 to 1978. In August of 2012, he died from mesothelioma. His wife first filed an action in Hawaii state court in December of 2012 against ExxonMobil, IMO Industries, Inc., and other defendants alleging the decedent’s asbestos exposure during his employment period.The plaintiff alleged three causes of action for (1) negligence under the Jones Act, (2) breach of warranty of seaworthiness and reasonable fitness under United States maritime law, and (3) for maintenance and cure. MOSAT became a defendant in this case in April of 2014, and in November of 2014, the court granted the defendants’ motions to dismiss. On the same day, the plaintiff filed an action in the Supreme Court of New York raising the same causes of action against approximately twenty defendants, including ExxonMobil, MOSAT, and Marshall Islands Maritime Corporate Administrators, Inc. (“MIMCA”), individually and as a successor to MOSAT.The case was removed from New York state court to federal court. Plaintiff served MIMCA instead of MOSAT, mistaking MIMCA to be MOSAT’s corporate successor and registered agent. MIMCA was subsequently dismissed as a defendant in March of 2015. ExxonMobil moved for summary judgment arguing in part that the Jones Act did not apply to ExxonMobil because MOSAT, not ExxonMobil was the decedent’s employer. In March of 2016, the Court granted plaintiff thirty days to file an amended complaint naming MOSAT as a defendant and sixty days to serve MOSAT.MOSAT filed a motion to dismiss for lack of personal jurisdiction because MOSAT did not engage in business in New York when the complaint was filed. MOSAT alternatively sought to dismiss the claim as time-barred. The Court subsequently denied the relief sought.1. Personal Jurisdiction in New YorkMOSAT argued that the court should look at whether it had personal jurisdiction over the defendant at the time the complaint was filed rather than whether it had personal jurisdiction over the defendant at the time the tortious conduct occurred. The court stated that it is required to examine whether MOSAT transacted business in New York and whether there is an articulable nexus between the business transacted and the cause of action.a. Transacted Business in New YorkThe court found that documents produced as exhibits to the plaintiff’s brief showed that MOSAT transacted business in New York and listed its “Principal Business Office” as a New York address. MOSAT argued that the New York address was primarily for “bookkeeping purposes.” The Court found that documents from the decedent’s employment period proved that MOSAT used the New York office to oversee and guide several operations that involved foreign flag vessels, including some of the vessels the decedent served on. The documents also showed that, at the time of the decedent’s employment, MOSAT considered the New York office to be the head of its “Foreign Fleet operations.” Thus, it found that MOSAT was transacting business in New York during the decedent’s employment period.b. Articulable Nexus Between Business Transacted and Cause of Action The plaintiff was required to establish the Court’s jurisdiction with respect to each of her three claims. The Court found that the plaintiff demonstrated that the causes of action arose out of MOSAT’s business transactions conducted in New York. Documents and records showed that MOSAT’s New York office oversaw the operations, repairs, and maintenance of vessels that the decedent worked on. Also, the evidence showed that MOSAT’s New York office had a certain level of authority and oversight regarding investigative measures and training related to asbestos in its vessels.2. Due ProcessDue process required the plaintiff to show that MOSAT had minimum contacts with New York and that the exercise of jurisdiction was reasonable under the circumstances. Because the plaintiff established that minimum contacts existed, the court considered whether this case presented an “exceptional situation where [the] exercise of jurisdiction is unreasonable even though minimum contacts are present.”  It determined that the exercise of jurisdiction over MOSAT was reasonable because the financial burden of the litigation imposed on MOSAT did not outweigh the court’s interest in adjudicating an action that arose out of business transactions that took place in New York. Thus, it denied MOSAT’s motion to dismiss for lack of personal jurisdiction.3. Statute of LimitationsThe statute of limitations for Jones Act claims and general maritime claims is three years. MOSAT argued that the plaintiff’s claims were time-barred because the plaintiff did not properly name MOSAT as a defendant until over three years after the decedent’s death. The plaintiff asserted that the claims against MOSAT were not time-barred because the original New York action was filed within the statute of limitations. The court determined that, in order to permit relation back to the original complaint under Rule 15(c), the time-barred complaint must arise out of the conduct in the original pleading and there must be a notice of the action and knowledge of the plaintiff’s mistake in the defendant’s identity. It held that the plaintiff’s complaint met all the requirements because MOSAT was aware of the plaintiff’s claims against it. Also, the Court determined that the plaintiff only failed to serve MOSAT within the statute of limitations because she mistakenly believed that MIMCA was MOSAT’s corporate successor. Thus, it denied MOSAT’s motion to dismiss; the plaintiff’s complaint against MOSAT related back to the date of the original complaint.