2013 ny ford europe order re jur .pdf

7/28/2019 2013 ny ford europe order re jur .pdf

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SUPREME COURT OF THE STATE OF NEW YORKCOUNTY OF NEW YORK :PART 30RAYMO ND FINERTY and MARY FINERTY, X- -___l_-___l_____l _____l_____l_____l r_

Index No. 190187/10Motion Seq. 007,008, 009, 010laintiffs,-against- DECISION AND ORDER

ABEX CORP ORA TION, et al., f

Motion sequence Nos. 007,008,009, and 010 are consolidated for disposition herein.In motion sequen ces Nos. 008 and 009, defendants Henry Ford&Son, Ltd. (Ford Ireland)

and Ford Motor Com pany, Ltd. (Ford England) (collectively, Defendants) respectively mov epursuan t to CPLR 321 l(a)(8) to dismiss the com plaint against each of them for lack of personaljurisdiction. In motion sequence Nos, 007 and 010, Ford Ireland and Ford England respectivelymove pursuant to CPLR 3103(a) for a protective order staying all discovery as to each of them untiltheir motions to dism iss are addre ssed.

Raymond Finerty was diagnosed with mesothelioma o n December 30,2009. He and hiswife M ary Finerty (Plaintiffs) comm enced this action on April 22 ,20 12 to recover for personalinjuries sustained in conn ection with his alleged asbestos exposure. Plaintiffs allege, among otherthings, that Defendants asbestos containing products caused or contributed to Mr. Finertys injuries.

Mr. Finerty was born in Ireland. He testified that du ring the 1970s and early 1980sheworked as a mechanic and was exposed to asbestos containing products from cars, tractors and

Mr. Finerty was deposed over the course of five days in June and August of 2010. Hisvideotaped depositionwas taken on May 26,20 11. The transcripts are submitted by th eparties as part of their papers on this motion.1

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associated repIacement parts. MI-* inerty emigrated to the United States in 1985. He has lived inQueens, New York with his family for almost 30 years.

Defendants each argue that they are entitled to dismissal for lack of personal jurisdictionbecause neither conducts business or has a presence in New York and the only place where Mr.Finertys alleged exposures to asbestos from their products occurred is Ireland. Thus, Defendantsassert there lacks any nexus to New Y a k sufficient for jurisdiction to attach. In opposition,Plaintiffs contend that Ford England is or was present and doing business in New York through ahost o f dealers and agents and that their independent investigation reveals that both D efendants areinere departments of Ford Motor Com pany (Ford USA) and can be sued in New York becauseFord USA i s present and doing business here. Plaintiffs seek jurisdictional discovery pursuant toCPLR 321.1 d).2

DISCUSSIONTo oppose a motion to dismiss pursuant to CPLR 321 l(a)(S), the plaintiff must demonstrate

apr ima acie basis for the exercise of personal jurisdiction. Funtis Foods, Inc. v StandardImporting Co., 49 NY2d 3 17 , 325 (1980); see also 0 Brienv Hackensack Univ.Med. Ctr., 305AD2d 199,200 (1 st Dept 2003) ([TJhe burden rests on plaintiff as the party asserting jurisdiction. .*) This means the plaintiff must allege jurisdictional contacts that, if proven, would be sufficient

to demonstrate that the exercise of personal jurisdiction would be proper under either New Yorks

CPLR 3211(d), entitled Facts unavailable to opposingparty, provides:Should it appear from affidavits submitted in opposition to a motion made under subdivision(a)or (b) that facts essential to justify opposition may exist but cannot then be stated, the court maydeny the motion, allowing the moving party to assert the objection in his responsive pleading, ifany, or may order a continuance to permit further affidavitsto be obtained or disclosure to be hadand may make such other order as may be just.

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general jurisdiction statute (CPLR 301) or New Y orks long-arm statute (CPLR 302), and that theexercise of jurisdiction co niports with the constitutional lim its of due process. SeeLaMarca vPak-Mor A4fg. Co.,95 NY2d 21 0 (2000).

A primafacie show ing of jurisdiction is not required on a CPLR 321 l(a)(8) motion todismiss, however, where essential jurisdictional facts in the exclusive control of the defendant ma yexist that are not yet know n to th e plaintiff. In this regard, the court will allow jurisdictionaldiscovery if the plaintiff has m ade a sufficient start and shown [its] position not to be fiivolous.Peterson v Spartan Indus., 33 NY2d 463,467 (1974); se e CPLR 321 1(d), How ever, a partys mereinvocation of CPLR 321 l(d ) is not, by itself, enough to defeat a CPLR 321 l(a)(S) mo tion todismiss. Mandel v Busch Entertainment Corp., 21 5 AD2d 455,455 2d Dept 1995). The plaintiffmust offer som e tangible evidence to show that jurisdiction may exist.

I. Ford IrelandFord Ireland wa s founded in 1917 in Cork, Ireland by Henry, Clara, and Edsel Ford.

According to former Man aging Director Edwin J. Nolan3, the company was named Henry Ford &Son, Ltd. because founder Henry Ford wished to expand Ford USA to E urope but could not obtainapproval from Ford USAs board of directors. He thus founded the company as a private venturefor himself and his children. Ford Irelands Cork plant initially manufactured tractors to be soldexclusively in Ireland. In 1922, tractor production c eased and the companys primary focus becameth e assembly of motor vehicles. The majority of these vehicles were sold in Ireland and the UnitedKingdom, except for a small num ber that were sold to Ford USA in the early 1960s. Ford Irelandceased the production of mo tor vehicles at its Cork Plant in 1984 after 65 years of operation.

Mr. Nolans affidavit, sworn to May 18, 2012, is submitted as exhibit B to Ford Irelandsmoving papers.3

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Today, Ford Ireland continues to im port and sell motor vehicles through its dealers in Ireland,Mr. Nolan avers that Ford Ireland has never conducted business in New York State, has

never made any sales in New Y ork, has never been licensed to do business in New York, has nooffice, sales personnel, property, or banks accounts in New York, and does not have an agent forservice of process here. Ford Ireland also submits an affidavit, sworn to September 23 ,20 10 , byCorey MacGillivray: Counsel with Ford USAs Corporate Practice Group since 1995, to support itsargument on this motion that Ford Ireland maintains its own books, records, financial statements,and bank accounts separate and apart from Ford USA. The two companies purportedly are managedby different boards of directors, without an overlap, and purportedly file separate public disclosurestatements in Ireland and the United States, respectively.

That a parent corporation does business in New York does not automatically give r ise topersonal jurisdiction over its foreign subsidiaries. Delagi v VolhwagenwerkAG o Wolfsburg,29NY2d 426,432 (1972); see also FIMBank P.L.C. v WooriFin. Holdings Co. TD., 2013 N.Y. App.Div. LEXIS 1972 (1st Dept 2013). However, the relationship between a parent and its subsidiarymay provide a basis for the exercise of suchjurisdiction if the foreign corporation is shown to be anagent of the domestic corporation, (see Fmrnmer v Hilton Hotels Int I, Inc., 9 NY2d 533, 537, cert.den. 389 US 923 [1967]),5or wh ere the parents control over the subsidiary is so pervasive that thecorporate separation is a mere formality, (Taca ntl.Airlines v Rolls-RoyceofEngland, 15 NY2d 97,

Mr. MacGillivrays affidavit is submitted as exhibit A to Ford Irelands reply brief.In Frummer, the Courtof Appeals held that Hilton Hotels Ltd., a British corporation,was doing business in New York because Hilton Reservation Service, a corporationwith offices and a bank account in New York, was owned in common by Hilton HotelsCorp. and Hilton Hotels International, as to which Hilton ReservationsService wasoperated on a non-profit basis for the benefit of Hilton Hotels Ltd.

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99-102 [1965])! Both theories sound in corporate presence doctrine and examine therelationship between a New York entity and a non-New York entity over which personal jurisdictionis sought in order to determine whether the non-New York entity is doing business in New York.Arbeeny v Kennedy Exec. Search, lnc. 3 1 Misc. 3d 494,497 (Sup. Ct. NY. Co, 2011, Bransten, J.)

Courts weigh sev eral factors to determine whether a foreign subsidiary is a mere departmentof a dom estic parent, to wit: (1) comm oii ownership and the presence of an interlocking directorateand executive stafe (2) financial dependency of the sub sidiary on the parent; (3) the deg ree to w hichthe parent interferes in the selection and assignment of the subsidiarys executive personnel and failsto observe corporate form alities; and (4) he degree of the parents control over the subsidiarysmarketing and op erational policies. See VolkswagenwerkAktiengesellschaft v Beech Aircraft Corp.,751 F2d 117, 120-122 (2d Cir. 1984).

Under Taca, supra, Plaintiffs argue that since Ford Ireland is a mere department of FordUSA, which does business in New York, Ford Ireland is present in New York for purposes ofCPLR 301. In this regard, Plaintiffs submit a printou t from a Ford USA information w ebsite0 012 which describes Ford Ireland as a division of Ford USA (Plaintiffs exhibit 14). Plaintiffsalso submit Ford USAs 2010 Annual Report which includes sales and revenue fiom throughoutEurope as part of Ford USAsprofit/loss statements (Plaintiffs exhibit 6 ) and Ford USA s 2011Annual Report which highlights its On e Ford, One T eam, One Plan, and On e Goal as itsglobal motto and operatingphilosophy. Under this four point business plan, the com pany

In Tuca, the plaintiff successfully asserted personal jurisdiction in New York over Rolls-Royce, which manufactured aircraft engines in England, on the basis of the presence ofits subsidiary in New York. The court found that the subsidiary and parent had commonexecutive officers and directors, executives of both companies met frequently to discusspolicy, employees were trained in England by the parent, marketing materials wereprepared by the parent, warranties were extended directly to the ultimate customer by theparent, and the parent financed the subsidiarys inventory.

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encourages . . .a single global approach . . .optimizing their collective strengths worldwide. Id,Ford Ireland contends these facts establish nothing more than a traditional parent-subsidiary

relationship and constitute only a threshold inquiry in the mere department analysis. To thecontrary, I find that the facts implicate the first and fourth Volkswagenwerk factors , to wit,commonality of ownership and the degree to which Ford USA may control Ford Irelands marketingand operational policies. Wh ile there appears to be little factual basis for a determination on th eremaining Volkswagenwerk factors, at this stage Ford Irelands own submissions that it is a whollyindependent subsidiary are unpersuasive. The affidavits of Messrs, Nolan and MacGillivray recitebroad based conclusory facts but no specific information with respect to Ford Irelands business,and contain no documentary support such as the companys disclosure statements, independentannual financial reports, or advertising materials.

11. Ford EnglandFord England was founded on December 7 , 192!L7 Ford England alleges that it has never

sold its products in New York, does not solicit business in New York, and has never been licensedto do business in New York. It purportedly does not maintain a business address or telephone i nNew York, and does not have any employees in New York.

Plaintiffs argue that Ford Englands history involved an elaborate and comprehensivenetwork of dealers selling its motor vehicles throughout New York State, In support Plaintiffs

According to Charles Clive Page, Ford Englands Company Secretary, Ford England isan English registered limited liability company that is wholly owned by Blue OvalHoldings, an English corporation. Mr. Page purports that Blue Oval Holdings is ownedby Ford International Capital LLC, a Delaware limited liability company, which in turnis owned by Ford USA. (See Supplemental Affidavit of Clive Charles Page, sworn toJanuary 30,2013, submitted as exhibit A to Ford Englands Reply brief.)

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See Affidavit of Charles Clive Page, Ford Englands Company Secretary,sworn toAugust 13 ,2013 , submitted as exhibit B to Ford Englands moving papers.8

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submit an undated advertisement entitled Europe in Comfort, which shows that over 50% of FordEnglands products were exported overseas, including to the United States. It further specifies thattheir cars were shipped back to USA fiom England free of extra cost and were sold and servicedthrough selected dealers of Ford M otor Com pany, Dearborn, Mich. A second undatedadvertisement, captioned theyre new! . . heyre from Biitain! .. heyre the best of the impoits! . .and best of a ll, each is a FORD product shows that Ford England utilized at least 40 authorizeddealers which sold and serviced their products throughout New York State.

Plaintiffs have also raised questions concerning Ford Englands presence in New York inlight of ts relationship with Ford USA. Plaintiffs show that Ford USA guaranteed Ford Englands$698 million loan from the British governm ent to upgrade its English factories (Plaintiffs exhibit 3,p. 58), and that in 1965 Henry Ford 11, Chairman of the Board of Ford USA, established anOverseasAutom otive Operations Division to which the Group Executive for Ford England was to directlyreport (plaintiffs exhibit 7). Ford USAs approval was required with respect to the appointment ofdirectors and o fficers, and the appearance, design, and packaging of replacement parts for FordEngland (Plaintiffs exhibit 8). Also comp elling is that Ford USA micro-managed Ford Englandsplanned expansion of its fac ilities in Cork, Ireland; Plaintiffs exhibit 10 shows that Ford USA notonly comm ented on Ford Englands plans but had to approve them before an y construction couldbegin. Ford USAs architectural engineer w as involved in all aspects of the planning process,including which engineering firms would be used, how the contract would be drafted, and themakeup and timetable of the construction schedule.

These two advertisements were submitted as attachments to Plaintiffs sur-reply, datedMarch 1,2013.9

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CONCLUSIONIn light of the foregoing, I find that Plaintiffs have made a sufficient start to warrant

jurisdictional discovely concerning the relationship between the Defendants and Ford USA, an d theextent to which they may have d one business in the United States, either directly or through agents.Accordingly, in the exercise of discretion, it is liereby

ORDERED that the issue of jurisdictional discovery is referred to the NYCAL SpecialMaster, who shall schedule and oversee such discovery consistent with this dec ision and order; andit is further

ORDERED that motion sequences Nos. 008 and 009 by Ford Ireland and Ford England todismiss for lack of personal jurisdiction are hereby marked off this cou rt's motion calendar withleave to reinstate by letter upon 10days' notice to the courtand the parties following the co mpletionof discovery as overseen by the Spec ial Master; and it is further

ORDERED that motion sequence Nos. 007 and 010 by Ford Ireland and Ford England tostay discovery arehereby denied as moot; and it is further

ORDERED that the parties are directed to contac t the Special Master with regard hereto nolater than 10 days ftom the date of this decision a9d o

This is the decision and order of the court.

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2013 ny ford europe order re jur .pdf

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