ATTORNEYS FOR APPELLANT ATTORNEY FOR APPELLEES
Jan M. Carroll John Thrasher
Asina C. Gant Indianapolis, Indiana
Indianapolis, Indiana
______________________________________________________________________________
In the
Indiana Supreme Court
_________________________________
No. 49S04-0603-CV-88
LINKAMERICA CORPORATION,
Appellant (Petitioner below),
v.
WILLIAM ALBERT AND CONNIE J. COX,
Appellees (Respondents below).
_________________________________
Appeal from the Marion Superior Court, No. 49D03-0203-PL-000445
The Honorable Patrick McCarty, Judge
_________________________________
On Petition To Transfer from the Indiana Court of Appeals, No. 49A04-0411-CV-601
_________________________________
December 5, 2006
Boehm, J.
We hold that the 2003 amendment to Indiana Trial Rule 4.4(A) eliminated the need for a
two-step process to evaluate personal jurisdiction over a party. We also hold that actions of a
subsidiary corporation do not ordinarily establish personal jurisdiction over its parent and find
that principle controlling in this case.
Facts and Procedural History
Hi-Cube Express, Inc. is an interstate carrier. It is an Oklahoma corporation with its
principal place of business in Oklahoma. Until 2004, Hi-Cube was admitted to do business in
Indiana and maintained a place of business in Indianapolis. It conducts its business, at least in
part, by contracting with “owner-operators” who own and drive trucks bearing Hi-Cube’s identi-
fication.
In 2001, William Cox, an Indiana resident, entered into a written contract to buy a semi-
tractor from Hi-Cube. Cox concurrently entered into a lease of the truck back to Hi-Cube and an
operating agreement requiring Cox to operate the vehicle as a Hi-Cube trucker under Hi-Cube’s
authority from the United States Department of Transportation. The terms of the purchase con-
tract required Cox to operate the truck pursuant to the lease and operating agreement until all
payments were made under the purchase agreement. In 2002, Hi-Cube terminated the lease and
operating agreement and subsequently repossessed the truck, contending the termination of the
operating agreement rendered Cox in default of the requirement in the purchase agreement that
Cox operate as a Hi-Cube carrier.
In 2002, Cox and his wife sued Hi-Cube in Marion Superior Court, claiming breach of
contract, personal injury, theft, and loss of consortium. In 2003, the trial court granted partial
summary judgment to the Coxes, finding liability on the breach of contract and theft counts, but
leaving the issue of damages for trial. Two weeks later, the Coxes sought and were granted
leave to file a third amended complaint, which added LinkAmerica Corporation as a defendant.
LinkAmerica is an Oklahoma corporation with its principal place of business in Oklahoma. It is
Hi-Cube’s ultimate parent. 1
LinkAmerica removed the case from the Marion Superior Court to the United States Dis-
trict Court for the Southern District of Indiana. While the case was before the district court,
LinkAmerica moved to dismiss as to it for lack of personal jurisdiction. The Coxes responded
with a motion to remand the case to the Marion Superior Court, contending that the case did not
1
Hi-Cube is a wholly owned subsidiary of Dannie Gilder, Inc., which is a wholly owned subsidiary of
LinkAmerica.
2
meet the jurisdictional amount for federal diversity jurisdiction. Without addressing personal
jurisdiction, the district court found the removal untimely and remanded the case to the Marion
Superior Court. On remand, the Marion Superior Court denied LinkAmerica’s motion to dismiss
for lack of personal jurisdiction but certified its order for interlocutory appeal. The Court of Ap-
peals affirmed the denial of LinkAmerica’s motion to dismiss for lack of personal jurisdiction.
LinkAmerica Corp. v. Cox, 828 N.E.2d 388 (Ind. Ct. App. 2005). We granted transfer. 855
N.E.2d 1001 (Ind. 2006).
Standard of Review
“Personal jurisdiction is a question of law . . . .” Anthem Ins. Co. v. Tenet Healthcare
Corp., 730 N.E.2d 1227, 1237 (Ind. 2000). As with other questions of law, a determination of
the existence of personal jurisdiction is entitled to de novo review by appellate courts. Id. We
do not defer to the trial court’s legal conclusion as to whether personal jurisdiction exists. Id.
However, personal jurisdiction turns on facts, typically the contacts of the defendant with the fo-
rum, and findings of fact by the trial court are reviewed for clear error. Id. at 1238.
I. The Reach of Indiana’s Long-Arm Provision
Indiana has no statutory provision governing the permissible exercise of personal juris-
diction. The subject is addressed in Trial Rule 4.4(A), which serves as Indiana’s long-arm provi-
sion. In 2000, this Court spelled out the test for personal jurisdiction under the Rule as it read at
the time: “First, the court must determine if the defendant’s contacts with the forum state fall
under [Indiana Trial Rule 4.4(A)]. Second, if they do, the court must then determine whether the
defendant’s contacts satisfy federal due process analysis.” Anthem, 730 N.E.2d at 1232 (foot-
note omitted). Anthem determined that it was error to evaluate personal jurisdiction by address-
ing only whether the exercise of personal jurisdiction over a defendant comports with the Due
Process Clause of the Fourteenth Amendment of the Federal Constitution. Anthem held that
“enumerated act” jurisdiction provisions, such as Indiana’s 2003 version of Trial Rule 4.4(A),
require a two-step analysis. Because Trial Rule 4.4(A) at the time lacked any general language
permitting personal jurisdiction on “any constitutional basis,” Indiana’s long-arm statute was not
3
“coextensive with the limits of personal jurisdiction under the [Federal] Due Process Clause.”
Id.
LinkAmerica contends that the subsequent amendment to Trial Rule 4.4(A) eliminated
the need for the two-pronged personal jurisdiction test set forth in Anthem. At the time Anthem
was decided, Trial Rule 4.4(A) listed eight activities that supported personal jurisdiction over a
nonresident (“doing business,” “causing personal injury,” etc.). 2 Effective January 1, 2003, the
following language was added to the end of subsection (A):
“In addition, a court of this state may exercise jurisdiction on any basis not incon-
sistent with the Constitutions of this state or the United States.”
Two federal courts have concluded that the 2003 addition to Indiana Trial Rule 4.4(A)
expanded personal jurisdiction to the full extent permitted by the Due Process Clause and elimi-
2
The Rule provided in entirety:
(A) Acts Serving as a Basis for Jurisdiction. Any person or organization that is a non-
resident of this state, a resident of this state who has left the state, or a person whose resi-
dence is unknown, submits to the jurisdiction of the courts of this state as to any action
arising from the following acts committed by him or her or his or her agent:
(1) doing any business in this state;
(2) causing personal injury or property damage by an act or omission done within this
state;
(3) causing personal injury or property damage in this state by an occurrence, act or
omission done outside this state if he regularly does or solicits business or engages in any
other persistent course of conduct, or derives substantial revenue or benefit from goods,
materials, or services used, consumed, or rendered in this state;
(4) having supplied or contracted to supply services rendered or to be rendered or goods
or materials furnished or to be furnished in this state;
(5) owning, using, or possessing any real property or an interest in real property within
this state;
(6) contracting to insure or act as surety for or on behalf of any person, property or risk
located within this state at the time the contract was made;
(7) living in the marital relationship within the state notwithstanding subsequent depar-
ture from the state, as to all obligations for alimony, custody, child support, or property
settlement, if the other party to the marital relationship continues to reside in the state; or
(8) abusing, harassing, or disturbing the peace of, or violating a protective or restraining
order for the protection of, any person within the state by an act or omission done in this
state, or outside this state if the act or omission is part of a continuing course of conduct
having an effect in this state.
T.R. 4.4(A).
4
nated any need to identify a specific jurisdictional basis from the list set out in the rule. In re
Methyl Tertiary Butyl Ether Prods. Liab. Litig., No. 1:00-1898, MDL 1358 (SAS), M21-88,
2005 U.S. Dist. LEXIS 753, at *57 (S.D.N.Y. Jan. 18, 2005); Litmer v. PDQUSA.com, 326 F.
Supp. 2d 952, 955 (N.D. Ind. 2004). The Court of Appeals agreed that the 2003 amendment to
Trial Rule 4.4(A) “calls into question the continuing viability of the two-part test in Indiana be-
cause the Indiana long-arm statute seemingly now contains what the Anthem court referred to as
‘any constitutional basis’ language.” LinkAmerica, 828 N.E.2d at 392 n.2. The Court of Ap-
peals also observed that another recent panel of that court had concluded that the two-pronged
test survived, reasoning that “if Indiana’s long-arm statute was intended to be coextensive with
the limits of personal jurisdiction under the Due Process Clause, the enumerated acts listed in
[Trial] Rule 4.4(A) could have been deleted and the Rule could have been rewritten with general
language . . . .” Pozzo Truck Ctr., Inc. v. Crown Beds, Inc., 816 N.E.2d 966, 969 n.2 (Ind. Ct.
App. 2004). 3 The Court of Appeals then left resolution of this issue “for another day” and evalu-
ated LinkAmerica’s personal jurisdiction claim under the Anthem test after stating that it would
have reached the same result under a single due process inquiry. LinkAmerica, 828 N.E.2d at
392 n.2.
The Court of Appeals was correct in noting, as Pozzo pointed out, that a catchall permit-
ting the exercise of jurisdiction on “any constitutional basis” logically embraces and renders un-
necessary any laundry list of specific acts. However, as In re Methyl observed, several other
states with “enumerated acts” long-arm statutes have expanded the reach of their long-arm provi-
sions without deleting the list of specified acts. 2005 U.S. Dist. LEXIS at *58-*59 (noting that
“[i]n recent years, Alabama, Alaska, Nebraska, Oregon, and Tennessee have amended their stat-
utes in this manner without deleting the enumerated sections of the acts”). In re Methyl con-
cluded, correctly, that Indiana’s long-arm provision “now extends to the limits of the Constitu-
tion.” Id. at *59. The 2003 amendment to Indiana Trial Rule 4.4(A) was intended to, and does,
reduce analysis of personal jurisdiction to the issue of whether the exercise of personal jurisdic-
tion is consistent with the Federal Due Process Clause. Retention of the enumerated acts found
3
The Court of Appeals also pointed to the decision of this Court in In re Paternity of A.B., 813 N.E.2d
1173, 1176 (Ind. 2004), which noted the trial court’s use of the two-part test and termed it “correct.” The
complaint in In re Paternity of A.B. was filed in 2002. 813 N.E.2d at 1174 n.1. The 2003 amendment
was not yet effective, and our decision in In re Paternity of A.B. sheds no light on the effect of the
amendment.
5
in Rule 4.4(A) serves as a handy checklist of activities that usually support personal jurisdiction
but does not serve as a limitation on the exercise of personal jurisdiction by a court of this state.
II. Jurisdiction over a Parent Corporation
The Due Process Clause of the Fourteenth Amendment requires that before a state may
exercise jurisdiction over a defendant, the defendant must have “certain minimum contacts with
[the state] such that the maintenance of the suit does not offend ‘traditional notions of fair play
and substantial justice.’” Int’l Shoe Co. v. Wash., 326 U.S. 310, 316 (1945) (quoting Milliken v.
Meyer, 311 U.S. 457, 463 (1940)). If the defendant’s contacts with the state are so “continuous
and systematic” that the defendant should reasonably anticipate being haled into the courts of
that state for any matter, then the defendant is subject to general jurisdiction, even in causes of
action unrelated to the defendant’s contacts with the forum state. See Helicopteros Nacionales
de Columbia, S.A. v. Hall, 466 U.S. 408, 415 n.9 (1984).
If the defendant’s contacts with the forum state are not “continuous and systematic,” spe-
cific jurisdiction may be asserted if the controversy is related to or arises out of the defendant’s
contacts with the forum state. Id. at 414 & n.8. Specific jurisdiction requires that the defendant
purposefully availed itself of the privilege of conducting activities within the forum state so that
the defendant reasonably anticipates being haled into court there. Burger King Corp. v. Rudze-
wicz, 471 U.S. 462, 474-75 (1985). A single contact with the forum state may be sufficient to
establish specific jurisdiction over a defendant, if it creates a “substantial connection” with the
forum state and the suit is related to that connection. McGee v. Int’l Life Ins. Co., 355 U.S. 220,
223 (1957). But a defendant cannot be haled into a jurisdiction “solely as a result of random,
fortuitous, or attenuated contacts or of the unilateral activity of another party or a third person.”
Burger King, 471 U.S. at 475 (internal quotation marks omitted) (citing Helicopteros, 466 U.S. at
417; Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 774 (1984); World-Wide Volkswagen
Corp. v. Woodson, 444 U.S. 286, 299 (1980)).
Finally, if the defendant has contacts with the forum state sufficient for general or spe-
cific jurisdiction, due process requires that the assertion of personal jurisdiction over the defen-
dant is reasonable. Id. at 477. The assertion of personal jurisdiction will rarely be found unrea-
6
sonable if “minimum contacts” are found. Reasonableness of exercising jurisdiction over a de-
fendant is determined by balancing five factors:
(1) the burden on the defendant; (2) the forum State’s interest in adjudicating the
dispute; (3) the plaintiff’s interest in obtaining convenience and effective relief;
(4) the interstate judicial system’s interest in obtaining the most efficient resolu-
tion of controversies; and (5) the shared interest of the several States in furthering
fundamental substantive social policies.
Id. at 476-77. These considerations come into play only if the defendant has sufficient contacts
with the forum state to assert personal jurisdiction. Asahi Metal Indus. Co. v. Superior Court,
480 U.S. 102, 116 (1987).
The plaintiff here is an Indiana resident, and the transaction occurred in Indiana. There is
no question that Hi-Cube was subject to personal jurisdiction in Indiana. It was a foreign corpo-
ration qualified to do business in this state and maintained a regular place of business in Indiana.
The Coxes contend that LinkAmerica, Hi-Cube’s ultimate parent, is also subject to suit in Indi-
ana. There is no claim here that LinkAmerica has taken any action in Indiana, had any contacts
with the state, or had any contacts with the plaintiff. Rather, the plaintiffs rely solely on Link-
America’s acts as the parent of its wholly owned subsidiary to establish jurisdiction in Indiana.
The issue, therefore, is simply whether LinkAmerica’s conduct as a parent of Hi-Cube meets the
“minimum contacts” test of International Shoe and its progeny.
We start with the presumption that a parent and a subsidiary are independent entities and
a subsidiary’s contacts with the forum are not attributed to the parent corporation for jurisdic-
tional purposes. Wesleyan Pension Fund, Inc. v. First Albany Corp., 964 F.Supp. 1255, 1261
(S.D. Ind. 1997) (citing Cannon Mfg. Co. v. Cudahy Packing Co., 267 U.S. 333, 336 (1925)).
Indeed, the Seventh Circuit has concluded that when corporate formalities are observed, permit-
ting the activities of the subsidiary to be the basis for exercising jurisdiction over the parent vio-
lates due process. Cent. States, Se. & Sw. Areas Pension Fund v. Reimer Express World Corp.,
230 F.3d 934, 944 (7th Cir. 2000). Overcoming this presumption requires clear evidence that
either: (1) the parent utilizes its subsidiary in such a manner that an agency relationship can be
perceived; (2) the parent has greater control over the subsidiary than is normally associated with
common ownership and directorship; or (3) the subsidiary is merely “an empty shell.” Wesley-
an, 964 F.Supp. at 1261-62. The Court of Appeals recognized this general doctrine but con-
7
cluded that the Coxes overcame the presumption by establishing that (1) LinkAmerica and all of
its subsidiaries had the same address in Oklahoma; (2) the same persons served as the Board of
Directors for both LinkAmerica and Hi-Cube; (3) the annual shareholder meetings for Link-
America and Hi-Cube were held at the same place and on the same day in 2000, 2001, and 2002
with only the same three people present; (4) LinkAmerica paid Hi-Cube’s legal fees in defense
of this lawsuit from March 2002 through March 2003; and (5) Hi-Cube’s checks carried the leg-
end that Hi-Cube was a “LinkAmerica Company.” LinkAmerica, 828 N.E.2d at 395.
The Court of Appeals relied on Wesleyan, where the district court found that the pre-
sumption of separate corporate existences had been overcome. We do not find Wesleyan appli-
cable here. In that case the parent corporation and its several subsidiaries had the same principal
place of business and operated their business, including their contacts with the plaintiffs, from
that location. The same three individuals were not merely the sole controlling principals, share-
holders, officers, and directors of the parent corporation and all its subsidiaries. They also served
as the operating personnel who engaged in telephone conversations and corresponded with the
plaintiffs on behalf of the various subsidiaries over several years. They ultimately secured the
plaintiffs’ purchase of $14.2 million in real estate securities from eight subsidiaries in seven
similar transactions. Wesleyan, 964 F.Supp. at 1263. In sum, not only the directors and some
corporate officers, but also the operating personnel were common to both parent and subsidiaries
and acted indiscriminately for both. They failed to observe any differentiation between the par-
ent and its subsidiaries at the operating level. Thus, it was entirely reasonable to attribute the
subsidiaries’ contacts with the forum state to the parent corporation based on the failure to ob-
serve corporate formalities and the lack of differentiation between the parent and subsidiaries.
The case before us is markedly different. First, and most importantly, although Link-
America and Hi-Cube maintained their home office at the same address in Oklahoma, Hi-Cube
conducted its daily business operations, including the transaction with Cox, through its separate
employees from its separate business location in Indiana. Hi-Cube’s president and his subordi-
nates made all daily business and operating decisions for Hi-Cube. None of these persons was a
LinkAmerica employee. Although two of the three directors common to LinkAmerica and Hi-
Cube were also officers of both corporations, the president of Hi-Cube never served as a director,
officer, or employee of LinkAmerica. LinkAmerica and Hi-Cube shared the same board of di-
8
rectors, but this is not unusual in a corporate family. It does not suggest the operating personnel
are common or indicate a failure to make clear in what capacity a person is acting. See U.S. v.
Bestfoods, 524 U.S. 51, 69 (1998) (noting that “it is entirely appropriate for directors of a parent
corporation to serve as directors of its subsidiary” (internal quotation marks omitted) (quoting
American Protein Corp. v. AB Volvo, 844 F.2d 56, 57 (2d Cir. 1988))). Similarly, the fact that
shareholder meetings for LinkAmerica and Hi-Cube occurred in the same location and on the
same day does not support a conclusion that LinkAmerica exerts greater than normal control
over Hi-Cube as its subsidiary. As the Seventh Circuit recently explained: “[p]arents of wholly
owned subsidiaries necessarily control, direct, and supervise the subsidiaries to some extent.”
Purdue Research Found. v. Sanofi-Synthelabo, 338 F.3d 773, 778 n.17 (7th Cir. 2003) (internal
quotation marks omitted) (quoting IDS Life Ins. Co. v. SunAmerica Life Ins. Co., 136 F.3d 537,
540 (7th Cir. 1998)). Every parent of a wholly owned subsidiary has absolute control in that the
parent has the power to direct the subsidiary to take any act the parent desires. “Control” in the
Wesleyan context refers to the management of the subsidiary’s operational activities, not passive
ownership or policy direction.
The imprint “a LinkAmerica company” on the check that Hi-Cube gave to Cox does not
support any inference that Hi-Cube is an agent of LinkAmerica or a mere “empty shell.” The
checks in this record were written by Hi-Cube to pay Cox, who contracted only with Hi-Cube’s
president and other employees of Hi-Cube. The checks were drawn on Hi-Cube’s separate
owner-operator account and the imprint did nothing more than note that Hi-Cube was a “Link-
America company,” i.e. a member of the same corporate family. This designation does not sug-
gest that Hi-Cube was the same entity as LinkAmerica or acting as an agent for LinkAmerica.
The payment of Hi-Cube’s legal fees from March 2002 through May 2003 by Link-
America amounts to no more than an intercompany loan. The Seventh Circuit has recently ob-
served that “a corporate parent may provide administrative services for its subsidiary in the ordi-
nary course of business without calling into question the separateness of the two entities for pur-
poses of personal jurisdiction.” Cent. States, 230 F.3d at 945. Thus, common corporate infra-
structure such as information technology and accounting services do not place the parent in the
subsidiary’s shoes whenever the subsidiary conducts business. Supplying necessary financing to
the subsidiary is in the same category.
9
Finally, LinkAmerica did nothing to erode the presumption of separateness from its sub-
sidiaries. Hi-Cube and LinkAmerica each maintained separate books, records, accounts, and
corporate minutes, thus, observing corporate formalities. LinkAmerica does not maintain an of-
fice or other place of business in Indiana; has no registered agent in Indiana; has no employees in
Indiana; does not pay taxes in Indiana; does not advertise in Indiana; and has no telephone facili-
ties, bank accounts, or other real or personal property in Indiana. LinkAmerica and Hi-Cube
have separate employee payroll accounts, and LinkAmerica has never represented Hi-Cube as a
department or division of LinkAmerica.
For the foregoing reasons, we conclude that the Coxes have not provided anything to
overcome the presumption that LinkAmerica and Hi-Cube are institutionally independent. As a
result, Hi-Cube’s contacts with the state cannot be attributed to LinkAmerica. Allowing the ex-
ercise of personal jurisdiction over a parent corporation solely based on the fact of ownership of
a subsidiary is not permitted by due process. Cf. Keeton, 465 U.S. at 781 n.13 (“[N]or does ju-
risdiction over a parent corporation automatically establish jurisdiction over a wholly owned
subsidiary.”). Because LinkAmerica does not have sufficient “minimum contacts” with the state,
it is unnecessary to engage in a “reasonableness” analysis.
LinkAmerica argues that the Court of Appeals incorrectly held that LinkAmerica’s cor-
porate veil should be pierced to exercise personal jurisdiction over LinkAmerica. We do not see
the issue as one of piercing the corporate veil, and the Court of Appeals appropriately made no
reference to piercing the corporate veil in its personal jurisdiction analysis. Piercing the veil is a
doctrine of liability, and “minimum contacts” is a jurisdictional concept. See Cent. States, 230
F.3d at 944. Piercing may, in some instances, be based on facts that also support the assertion of
jurisdiction over the parent of a subsidiary. Otherwise stated, the same conduct of a foreign cor-
porate defendant may in some cases expose it to both personal jurisdiction and liability under the
laws of a particular forum. Wesleyan appears to be such a case because the same operating per-
sonnel were acting simultaneously for the parent and its subsidiaries. But personal jurisdiction
raised by a motion to dismiss is a preliminary question that must be resolved before addressing
the issue of piercing the veil. Cent. States, 230 F.3d at 944.
10
Conclusion
The trial court’s denial of LinkAmerica’s motion to dismiss for lack of personal jurisdic-
tion is reversed.
Shepard, C.J., and Dickson, Sullivan, and Rucker, J.J., concur.
11