Kuenzle v. HTM Sport-Und Freizeitgeräte AG

PUBLISH

UNITED STATES COURT OF APPEALS
Filed 12/11/96TENTH CIRCUIT

BEVERLY KUENZLE and WAYNE
KUENZLE,

Plaintiffs-Appellees,

v. No. 95-8031

HTM SPORT-UND
FREIZEITGERÄTE AG,

Defendant-Appellant,

Appeal from the United States District Court
for the District of Wyoming
(D.C. No. 92-CV-299-B)

Hampton K. O’Neill (W. Henry Combs, III, with him on the briefs), of Murane &
Bostwick, Casper, Wyoming, for Defendant-Appellant.

William R. Fix, Jackson, Wyoming, for Plaintiffs-Appellees.

Before SEYMOUR, Chief Judge, HOLLOWAY and BRISCOE, Circuit Judges.

SEYMOUR, Chief Judge.
 Defendant HTM Sport-Und Freizeitgeräte AG (Tyrolia) sought leave to

appeal the district court’s denial of its motion to dismiss for lack of personal

jurisdiction. The district court granted leave for a permissive appeal pursuant to

28 U.S.C. § 1292(b). We accepted the appeal and we now reverse the decision of

the district court.

I.

Plaintiff Beverly Kuenzle, a tourist from Missouri, was seriously injured in

a skiing accident near Jackson, Wyoming, in 1990. At the time of the accident,

Ms. Kuenzle was using Model 285-S ski bindings that were manufactured in

Austria by defendant Tyrolia and purchased by her in Switzerland in 1986. Ms.

Kuenzle asserts that the bindings were defectively designed, manufactured and/or

assembled, and that they had been recalled prior to her accident. She brought this

diversity action against Tyrolia in Wyoming, alleging breach of warranty, strict

product liability, and negligence. Ms. Kuenzle’s husband, Wayne, sued Tyrolia

for loss of services, consortium, and companionship, society and support. 1

The Kuenzles also sued Hoback Sports, Inc. (Hoback), a Jackson,
1

Wyoming, business. Ms. Kuenzle had brought her skis to Hoback to be serviced
shortly before the accident. The Kuenzles alleged that Hoback had a duty to
inform Ms. Kuenzle that her bindings had been recalled because Hoback knew
about the recall at the time it serviced Ms. Kuenzle’s skis. Prior to the district
court’s consideration of Tyrolia’s motion to dismiss, the Kuenzles reached a
(continued...)

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 Tyrolia has not addressed the merits of the Kuenzle’s claims, arguing

instead that it had insufficient contacts with Wyoming to support assertion of the

court’s jurisdiction. Specifically, Tyrolia points out that it is an Austrian

company which sells its products in the United States only through an

independent distributor and that it conducts no business in Wyoming. The

Kuenzles argue that Tyrolia had sufficient contacts with Wyoming, through the

actions of its employees and independent distributor, to establish personal

jurisdiction.

To determine whether jurisdiction is present, we first review the criteria for

establishing personal jurisdiction and then evaluate whether any of the contacts

on which the Kuenzles rely satisfy those criteria.

II.

“To obtain personal jurisdiction over a nonresident defendant in a diversity

action, a plaintiff must show that jurisdiction is legitimate under the laws of the

forum state and that the exercise of jurisdiction does not offend the due process

clause of the Fourteenth Amendment.” Far West Capital, Inc. v. Towne, 46 F.3d

1071, 1074 (10th Cir. 1995) (emphasis omitted). Wyoming courts “may exercise

(...continued)
settlement with Hoback, leaving Tyrolia as sole defendant.

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jurisdiction on any basis not inconsistent with [either] the Wyoming or [the]

United States constitution.” W YO . S TAT . § 5-1-107(a) (1992). Because this

statute extends Wyoming jurisdiction to the limit of the federal constitution, “our

only concern is whether . . . maintenance of the suit . . . would . . . offend the due

process clause of the Fourteenth Amendment.” Shanks v. Westland Equip. &

Parts Co., 668 F.2d 1165, 1167 (10th Cir. 1982).

Historically, due process was considered to be satisfied only when a

defendant’s person or property was present in the forum state. Pennoyer v. Neff,

95 U.S. 714, 722 (1877). The personal presence requirement generally prevented

assertion of jurisdiction over a nonresident defendant, id., especially when the

defendant was a corporation which was considered “present” only in its state of

incorporation. See 4 C HARLES A. W RIGHT & A RTHUR R. M ILLER , F EDERAL

P RACTICE AND P ROCEDURE § 1066 (2d ed. 1987) (discussing traditional notions of

jurisdiction as applied to corporate defendants). In International Shoe Co. v.

Washington, 326 U.S. 310 (1945), the Court relaxed Pennoyer’s rigid presence

requirement when it held that, in addition to presence of person or property in the

forum, due process would not be offended by the exercise of jurisdiction over a

nonresident defendant if that defendant had “certain minimum contacts with [the

forum] such that the maintenance of the suit does not offend ‘traditional notions

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of fair play and substantial justice.’” Id. at 316 (quoting Milliken v. Meyer, 311

U.S. 457, 463 (1940)).

The “‘minimum contacts’ standard may be met in either of two ways.”

Trierweiler v. Croxton & Trench Holding Corp., 90 F.3d 1523, 1532 (10th Cir.

1996). First, a court may exercise specific jurisdiction if a “defendant has

‘purposefully directed’ his activities at residents of the forum . . . and the

litigation results from alleged injuries that ‘arise out of or relate to’ those

activities.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985) (citations

omitted) (emphasis added). Second, a court may exercise general jurisdiction

where the defendant’s contacts, while not rising to the level of the traditional

notion of presence in the forum state, are nonetheless “continuous and

systematic.” Trierweiler, 90 F.3d at 1533 (quoting Helicopteros Nacionales de

Colombia, S.A. v. Hall, 466 U.S. 408, 416 (1984)); Burger King, 471 U.S. at 473

n.15; Dobbs v. Chevron U.S.A., Inc., 39 F.3d 1064, 1068 (10th Cir. 1994);

Kennedy v. Freeman, 919 F.2d 126, 128 n.2 (10th Cir. 1990). 2 Where “[g]eneral

2
The “minimum contacts” principle was first articulated in International
Shoe v. Washington, 326 U.S. 310, 311-12 (1945), in the context of specific
jurisdiction. The cause of action there arose out of forum-related contacts. Since
that time, some courts have applied “minimum contacts” analysis exclusively to
specific jurisdiction cases. Glater v. Eli Lilly & Co., 744 F.2d 213, 216 (1st Cir.
1984). That restrictive characterization of minimum contacts is understandable
given the Supreme Court’s statement in Keeton v. Hustler Magazine, Inc., 465
U.S. 770, 779 (1984), that minimum contacts are not required for an assertion of
(continued...)

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jurisdiction lies . . . the state may exercise personal jurisdiction over the

defendant, even if the suit is unrelated to the defendant’s contacts with the state.”

Trierweiler, 90 F.3d at 1533.

“Whether a non-resident defendant has the requisite minimum contacts with

the forum state to establish in personam jurisdiction must be decided on the

particular facts of each case.” Shanks, 668 F.2d at 1166. “The plaintiff bears the

burden of establishing personal jurisdiction over the defendant.” Behagen v.

Amateur Basketball Ass’n of the United States, 744 F.2d 731, 733 (10th Cir.

1984), cert. denied, 471 U.S. 1010 (1985). As is the case here, “when a motion to

dismiss for lack of jurisdiction is decided on the basis of affidavits and other

written materials, the plaintiff need only make a prima facie showing.” Id. “We

2
(...continued)
general jurisdiction; rather, the proper general jurisdiction inquiry is whether the
defendant’s contacts are sufficiently “‘continuous and systematic.’” Id. (quoting
Perkins v. Benguet Mining Co., 342 U.S. 437, 438 (1952)). The strong
implication from Keeton was that “minimum contacts” was a tool only of specific
jurisdiction analysis. But since the issuance of Keeton, the Court has prefaced its
discussion of both specific and general jurisdiction over nonresident defendants
with the phrases “minimum contacts” and “traditional notions of fair play and
substantial justice.” Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S.
408, 414 (1984) (quoting International Shoe, 326 U.S. at 316). Since
Helicopteros, the practice of using the phrase “minimum contacts” to signify the
broader due process inquiry into the sufficiency of any nonresident defendant’s
contacts with a forum state, rather than just an analysis of the sufficiency of
specific jurisdiction contacts, has been adopted by many courts, and is followed
by our circuit. Trierweiler v. Croxton & Trench Holding Corp., 90 F.3d 1523,
1532-33 (10th Cir. 1996); Dobbs v. Chevron U.S.A., Inc., 39 F.3d 1064, 1068
(10th Cir. 1994).

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resolve all factual disputes in favor of the plaintiff,” and “review[] the district

court’s ruling . . . de novo.” Far West Capital, 46 F.3d at 1075.

III.

Although the district court held it had in personam jurisdiction over Tyrolia

without specifying whether that jurisdiction was specific or general, it applied a

specific jurisdiction analysis, as do both parties in their appellate briefs. 3 We will

therefore first consider whether Tyrolia is properly subject to specific jurisdiction

in Wyoming.

A. Specific Jurisdiction

“Specific jurisdiction may be exercised where the defendant has

‘purposefully directed’ its activities toward the forum jurisdiction and where the

underlying action is based upon activities that arise out of or relate to the

defendant’s contacts with the forum.” In re Application to Enforce

Administrative Subpoenas Duces Tecum, 87 F.3d 413, 418 (10th Cir. 1996)

(quoting Burger King, 471 U.S. at 472). In finding that Tyrolia had sufficient

contacts with Wyoming to justify the assertion of personal jurisdiction, the

3
The district court and the parties applied the law of two specific
jurisdiction cases to the facts of this case, Asahi Metal Indus. Co. v. Superior
Court, 480 U.S. 102 (1987), and World-Wide Volkswagen Corp. v. Woodson, 444
U.S. 286 (1980).

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district court considered only one branch of the specific jurisdiction test: the

degree of purposeful availment reflected in the contacts of the defendant with the

forum state. Although the district court gave extensive review to that issue, it did

not address the second prong, which must be met before a court can properly

exercise specific jurisdiction. The contacts must reflect purposeful availment and

the cause of action must arise out of those contacts.

In this case, Tyrolia manufactured the bindings in Austria and Ms. Kuenzle

bought them in Switzerland and brought them to Wyoming herself. Regardless of

any contacts that exist between Tyrolia or its independent distributor and the

forum, this cause of action for defective bindings and breach of warranty did not

arise out of those contacts. As the court noted in Omeluk v. Langsten Slip &

Batbyggeri A/S, 52 F.3d 267 (9th Cir. 1995), the requirement “that the claim

arises out of or results from the forum-related activities, is . . . not satisfied”

when the plaintiff “would have suffered the same injury even if none of the

[defendant’s forum] contacts had taken place.” Id. at 271-72. Ms. Kuenzle’s

accident would have occurred in Wyoming even if Tyrolia had made none of the

contacts on which the Kuenzles rely to create jurisdiction. We therefore conclude

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that the cause of action did not arise out of forum related activities and that the

district court does not have specific jurisdiction over Tyrolia. 4

B. General Jurisdiction

Although specific jurisdiction fails in this case, due process would not be

offended by the district court’s assertion of jurisdiction if Tyrolia had contacts

with Wyoming sufficient to “constitute the kind of continuous and systematic

general business contacts” required for general jurisdiction. Helicopteros, 466

U.S. at 416.

In assessing contacts with a forum, courts have considered such
factors as: (1) whether the corporation solicits business in the state
through a local office or agents; (2) whether the corporation sends
agents into the state on a regular basis to solicit business; (3) the
extent to which the corporation holds itself out as doing business in

4
Because the parties have not briefed or argued the issue, “we decline to
reach the question[] [of] whether the terms ‘arising out of’ and ‘related to’
describe different connections between a cause of action and a defendant’s
contacts with a forum.” Helicopteros, 466 U.S. at 415 n.10. See also
Ticketmaster-New York, Inc. v. Alioto, 26 F.3d 201, 206-07 (1st Cir. 1994)
(discussing how courts since Helicopteros have interpreted the relatedness
requirement).
For a discussion of the “arises out of” component of specific jurisdiction in
a hypothetical case similar to the case at bar, compare Mary Twitchell, The Myth
of General Jurisdiction, 101 Harv. L. Rev. 610, 660-65 (1988) (discussing a case
where defendant corporation markets a product and plaintiff is injured in the
forum state, but the cause of action does not “arise out of” the forum state
because plaintiff did not buy the product in the forum), and Mary Twitchell, A
Rejoinder to Professor Brilmayer, 101 Harv. L. Rev. 1465, 1469-70 (1988) with
Lea Brilmayer, Related Contacts and Personal Jurisdiction, 101 Harv. L. Rev.
1444, 1459-62 (1988).

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 the forum state, through advertisements, listings or bank accounts;
and (4) the volume of business conducted in the state by the
corporation.

Trierweiler, 90 F.3d at 1533 (citing 4 W RIGHT & M ILLER § 1069 at 348-55

(collecting cases)).

The Kuenzles argue (albeit in the specific jurisdiction context) that Tyrolia

has established sufficient contacts with Wyoming in two ways, directly through its

acts in the forum, and indirectly through the acts of its independent distributor.

We will consider the sufficiency of those contacts in light of the factors set out

above.

1. Tyrolia Contacts with Wyoming

Tyrolia is not authorized to conduct business in Wyoming. It maintains no

offices or employees in Wyoming, it owns no property in Wyoming, it maintains

no telephone listing in Wyoming, and it does no advertising for the Model 285-S

bindings in Wyoming. Although Tyrolia products apparently commanded a

substantial share of the regional and national markets, there is no such evidence

specific to Wyoming. The record contains no indication that any employee or

officer of Tyrolia has ever been in Wyoming, or even, with one exception, 5 that

5
Hoback’s general manager, Vincent Principe, attended a Tyrolia seminar in
Kitzbuhel, Austria, in early January 1995. The Austrian government and Atomic,
another Austrian ski products manufacturer, paid Mr. Principe’s travel expenses
to Kitzbuhel as part of a promotion for Austrian products. While he was there,
(continued...)

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Tyrolia has ever had direct dealings with any person or business in Wyoming.

Although Tyrolia has some contacts with the United States, 6 it has no direct

contacts with the state of Wyoming. In the absence of continuous and systematic

activity in the forum, we cannot justify a finding of general jurisdiction based on

Tyrolia’s contacts alone. We must therefore analyze Tyrolia’s indirect contacts

with Wyoming, created through its independent distributor, to determine whether

they are sufficient to justify the assertion of general jurisdiction over Tyrolia.

2. Independent Distributor Contacts with Wyoming

At the time of Ms. Kuenzle’s accident, Tyrolia’s independent United States

distributor was Raichle Molitor USA, Inc. (Raichle), which is based in Brewster,

(...continued)
Mr. Principe discussed Tyrolia’s wares with a Tyrolia staff employee.
6
Franz Deutsch, Tyrolia’s general manager, stated in his 1995 deposition
that he had visited the United States twice in 1994 to attend a trade show in Las
Vegas as a representative of Tyrolia. He generally goes to this trade show every
two or three years. At the show, he is usually accompanied by three to five
employees of Tyrolia’s United States distributor. Mr. Deutsch has also been to
Vail and Aspen in Colorado on business, but has never visited Wyoming.
Tyrolia’s other direct contact with the United States is provided through its
insurance carrier. Tyrolia carried liability insurance provided by a New York
insurance carrier at the time Ms. Kuenzle’s accident occurred.
For a discussion of personal jurisdiction over international defendants, see
Gary B. Born, Reflections on Judicial Jurisdiction in International Cases, 17 Ga.
J. Int’l & Comp. L. 1, 37-42 (1987) (arguing theory of aggregate national contacts
when international defendants are involved in state law cases), and Graham C.
Lilly, Jurisdiction over Domestic and Alien Defendants, 69 Va. L. Rev. 85, 116-
17 (1983).

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New York. Raichle bought Tyrolia bindings F.O.B. Schwechat, Austria 7 and

shipped them to the United States. Sometime after Ms. Kuenzle’s accident,

Tyrolia changed to a new distributor, the firm of Head Sports (Head) in Boulder,

Colorado. Tyrolia now ships its products directly to Head in Colorado. As

independent distributors, Raichle and Head promoted Tyrolia’s products.

Through these efforts, Tyrolia products apparently command a one-sixth share of

the bindings market, although the record does not specify whether this figure

refers to sales within the United States as a whole or just the Rocky Mountain

area. One-fifth of Tyrolia’s entire sales of bindings are to the United States and

Canada. In the past, promotional activities by the distributors have included:

training technicians to service Tyrolia equipment; staffing product booths at trade

shows; assigning sales representatives to territories which include Wyoming;

authorizing retail outlets to act as “dealers” of Tyrolia products, some of which

apparently sell Tyrolia products in Wyoming; and authorizing retail stores to

serve as recall dealers in Wyoming. 8

7
This “means that the seller was contractually required to make delivery in
[Schwechat], not elsewhere.” Afram Export Corp. v. Metallurgiki Halyps, S.A.,
772 F.2d 1358, 1365 (7th Cir. 1985) (citing J AMES J. W HITE & R OBERT S.
S UMMERS , H ANDBOOK OF THE L AW U NDER THE U NIFORM C OMMERCIAL C ODE 107
(2d ed. 1980)).
8
Hoback Sports in Jackson, Wyoming, was a Tyrolia recall distributor for
one year in 1991. As a recall distributor, Hoback sold no new Tyrolia equipment,
but did replace bindings and other recalled equipment for Tyrolia. In his
(continued...)

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 From these facts it is clear that Tyrolia products are distributed in the

United States and in Wyoming through an independent distributor. It is not

equally clear, however, that the acts of the independent distributor can be

attributed to Tyrolia for the purpose of establishing general jurisdiction. As the

Court in International Shoe explained, a nonresident corporate entity creates

contacts for personal jurisdiction purposes through its authorized representatives:

its employees, directors, officers and agents. International Shoe, 326 U.S. at 316

(a corporation’s presence, for personal jurisdiction purposes, is “manifested only

by activities carried on in its behalf by those who are authorized to act for it”).

The actions of an independent distributor may not insulate a foreign company

from specific jurisdiction. See Asahi Metal Indus. Co. v. Superior Court, 480

U.S. 102, 112 (1987) (plurality opinion of Justice O’Connor) (“marketing the

product through a distributor who has agreed to serve as the sales agent in the

forum State” may constitute the “[a]dditional conduct” needed to establish

minimum contacts); Renner v. Lanard Toys Ltd., 33 F.3d 277, 282 (3d Cir. 1994)

("a foreign manufacturer or seller [which] rids itself of title by a sale F.O.B. a

foreign port [does not] insulate [itself] from jurisdiction if there is the other type

of activity” indicating purposeful availment). However, a different analysis

8
(...continued)
deposition, Hoback’s manager stated that two other stores in the Jackson area sold
Tyrolia equipment between 1976 and 1991.

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applies in the general jurisdiction context because, “[f]or general jurisdiction, the

defendant’s contacts with the state must be greater than those required for

specific jurisdiction.” Doe v. National Medical Servs., 974 F.2d 143, 146 (10th

Cir. 1992).

In Wells Fargo & Co. v. Wells Fargo Express Co., 556 F.2d 406, 422 (9th

Cir. 1977), the court stated that, to achieve general jurisdiction over a corporation

through a subsidiary, the existence of a “general” agency relationship must be

demonstrated “so that it is not unfair or unreasonable to have [the foreign

corporation] answer to the general jurisdiction of the . . . district court.” Id.

Other courts have concluded in the general jurisdiction context that an

independent distributor’s actions in a forum state will not be attributable to a

foreign corporation in the absence of an agency relationship. See Conti v.

Pneumatic Prods. Corp., 977 F.2d 978, 981 (6th Cir. 1992) (holding that actions

of distributors in forum state to sell and service products will not constitute

continuous and systematic contact by manufacturer with forum required for

general jurisdiction); R.L. Lipton Distrib. Co. v. Dribeck Importers, Inc., 811 F.2d

967, 970 (6th Cir. 1987) (concluding that, since the “[distributor’s] status was

that of an independent contractor [rather than an agent,] . . . we cannot attribute

its conduct and contacts to [the importer]”); Cascade Corp. v. Hiab-Foco AB, 619

F.2d 36, 37 (9th Cir. 1980) (finding no general jurisdiction in Oregon over

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Swedish corporation that sells its products F.O.B. in Sweden to a United States

subsidiary which markets through an Oregon independent distributor, when only

additional contact between defendant and forum were letters and occasional

visits). But cf. Michigan Nat’l Bank v. Quality Dinette, Inc., 888 F.2d 462, 465

(6th Cir. 1989) (reversing dismissal for lack of general personal jurisdiction

where corporation had in-state contacts established by an independent sales

representative, by solicitation of sales, and by making sales accounting for three

percent of gross).

We are persuaded that in the absence of an agency relationship, the acts of

a distributor are not ordinarily attributable to a foreign manufacturer for purposes

of establishing general jurisdiction. In the circumstances of this case, where there

are no direct contacts between Tyrolia and Wyoming, we hold that the Kuenzles

must show the existence of an agency relationship between Tyrolia and its

distributor in order for the distributor’s contacts with Wyoming to support general

jurisdiction over Tyrolia.

An agency relationship is “the fiduciary relation which results from the

manifestation of consent by one person to another that the other shall act on his

behalf and subject to his control, and consent by the other so to act.” True v. Hi-

Plains Elevator Mach., Inc., 577 P.2d 991, 999 (Wyo. 1978) (quoting

R ESTATEMENT (S ECOND ) OF A GENCY § 1 (1957)). “There can be no agency

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relationship unless the factual element of control is present.” Id. at 999. An

agency relationship cannot be presumed, but rather must be clearly demonstrated.

Sarchet v. Roach, 163 P.2d 185, 188 (Wyo. 1945). Although it is not

inconceivable that an agency relationship existed between Tyrolia and Head, 9 the

Kuenzles have not introduced evidence sufficient to permit us to draw that

conclusion. Consequently, we cannot impute to Tyrolia any contacts Head had

with Wyoming in its efforts to market products made by Tyrolia.

Because the record does not establish that Tyrolia had continuous or

systematic contacts with Wyoming, either directly or through an agent, we hold

that the Kuenzles did not meet their prima facie burden of establishing that the

district court could exercise general jurisdiction over Tyrolia.

9
The pertinent agency relationship for general jurisdiction would be
between Tyrolia and Head, its independent distributor in 1992 at the time the
complaint was filed. Wells Fargo, 556 F.2d at 422. The record fails to
demonstrate the existence of an agency relationship between Tyrolia and Head.
First, the record fails to distinguish between the acts of Raichle and Head.
Second, even if all the acts of independent distributors in the record were
assumed to be attributable to Head, the record fails to establish the elements of
control and consent required of any express or implied agency relationship.

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IV.

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 Because the Kuenzles have failed to establish that the district court could

exercise either specific or general jurisdiction over Tyrolia, we REVERSE and

remand with directions to dismiss this action for lack of jurisdiction.

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