United States Court of Appeals,
Fifth Circuit.
No. 95-60332.
Tony B. JOBE, Assignee of Air New Orleans, Inc., Plaintiff-
Appellant,
v.
ATR MARKETING, INC.; Avions De Transport Regional, (G.I.E.);
Aerospatiale, S.N.I.; Finmeccanica S.p.A., Individually and d/b/a
Alenia (a division of Finmeccanica) a/k/a Aeritalia S.p.A. and the
successor in the Interest of Aeritalia; Aerospatiale, Inc.;
Defendants A-M, Defendants-Appellees.
July 11, 1996.
Appeal from the United States District Court for the Southern
District of Mississippi.
Before JOLLY, DUHÉ and STEWART, Circuit Judges.
E. GRADY JOLLY, Circuit Judge:
The question before us on appeal is whether the district court
erred in dismissing this diversity case for lack of personal
jurisdiction under Mississippi's long-arm statute. Finding no
error, we affirm.
I
Tony B. Jobe, former president and assignee in bankruptcy of
Air New Orleans, Inc. ("ANO"), a now defunct commuter airline,
brought this breach of contract and tort action in the United
States District Court for the Southern District of Mississippi on
behalf of ANO's bankrupt estate. Jobe sued a group of ANO's former
business collaborators, all of whom are nonresidents of the state
of Mississippi. The defendant group includes: ATR Marketing, Inc.
("ATR"), a District of Columbia corporation; Aerospatiale, S.N.I.,
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a French corporation; Aerospatiale, Inc., a New York corporation;
Finmeccanica, S.p.A., an Italian corporation; and Avions de
Transport Regional (G.I.E.), a group organized under the laws of
France. Jobe, a Louisiana resident, alleges in his amended
complaint that the defendants intentionally negotiated in bad faith
to sell six commuter airplanes to ANO. Instead of consummating the
sale with ANO, Jobe contends that the defendants breached their
agreement with ANO and sold a fleet of approximately fifty aircraft
to Continental Airlines. In addition, Jobe alleges that ANO relied
to its detriment on the defendants' false representations, that the
defendants disclosed confidential information to Continental
Airlines, and that the defendants' tortious conduct led to ANO's
financial demise. In January 1988, ANO filed for bankruptcy
protection in the United States Bankruptcy Court for the Eastern
District of Louisiana. Months after filing its bankruptcy
petition, ANO began renting operations and maintenance facilities
at the Gulfport, Mississippi airport in May 1988. According to
Jobe's sworn affidavit, all of ANO's postpetition operations,
including its business in Mississippi, ceased by June 1988. ANO's
estate is currently involved in Chapter 7 bankruptcy proceedings.
After Jobe filed this action in Mississippi, the district
court ordered that discovery should be limited to the
jurisdictional issue and subsequently dismissed Jobe's complaint
for lack of personal jurisdiction. The district court found that
Jobe was not a Mississippi resident, that the alleged torts did not
take place in whole or in part in Mississippi and that no part of
2
Mississippi's long-arm statute1 could be construed to confer
jurisdiction over the nonresident defendants.
On appeal, Jobe relies solely on the "tort-prong" of
Mississippi's long-arm statute to support his contention that
personal jurisdiction over these defendants is proper. The
statute's tort-prong provides for personal jurisdiction over any
nonresident who commits a tort in whole or in part within the state
of Mississippi against a resident or nonresident of the state.
Miss.Code Ann. § 13-3-57 (Supp.1995).
II
We review de novo a dismissal for lack of personal
jurisdiction pursuant to Fed.R.Civ.P. 12(b)(2). Kevlin Servs.,
Inc. v. Lexington State Bank, 46 F.3d 13, 14 (5th Cir.1995). When
a nonresident defendant moves to dismiss for lack of personal
jurisdiction, the plaintiff bears the burden of establishing the
district court's jurisdiction over the nonresident. Wilson v.
Belin, 20 F.3d 644, 648 (5th Cir.1994). In determining whether
1
Mississippi's long-arm statute provides in relevant part:
Any nonresident ... corporation not qualified under the
Constitution and laws of this state as to doing
business herein, who shall make a contract with a
resident of this state to be performed in whole or in
part by any party in this state, or who shall commit a
tort in whole or in part in this state against a
resident or nonresident of this state, or who shall do
any business or perform any character of work or
service in this state, shall by such act or acts be
deemed to be doing business in Mississippi and shall
thereby be subjected to the jurisdiction of the courts
of this state.
Miss.Code Ann. § 13-3-57 (Supp.1995).
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personal jurisdiction exists, the trial court is not restricted to
a review of the plaintiff's pleadings. It may, as the district
court did in this case, determine the jurisdictional issue by
receiving affidavits, interrogatories, depositions, oral testimony,
or any combination of the recognized methods of discovery. Colwell
Realty Investments v. Triple T. Inns of Arizona, 785 F.2d 1330 (5th
Cir.1986).
In a federal diversity suit, the reach of federal
jurisdiction over nonresident defendants is measured by a two-step
inquiry. Smith v. DeWalt Products Corp., 743 F.2d 277, 278 (1984).
First, the law of the forum state must provide for the assertion of
such jurisdiction; and, second, the exercise of jurisdiction under
state law must comport with the dictates of the Fourteenth
Amendment Due Process Clause. Id. However, if Mississippi law
does not provide for the assertion of personal jurisdiction over
the defendants, it follows that we need not consider the due
process issue. Id.; Cycles, Ltd. v. W.J. Digby, Inc., 889 F.2d
612, 616 (5th Cir.1989).
In construing the tort-prong of Mississippi's long-arm
statute, the Mississippi Supreme Court has held that personal
jurisdiction over a defendant who allegedly committed a tort is
proper if any of the elements of the tort—or any part of an
element—takes place in Mississippi. Smith v. Temco, Inc., 252
So.2d 212 (Miss.1971). Although the specific elements of a
particular tort will vary, the conventional tort elements in a
negligence action are duty, breach of duty, proximate causation and
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injury.2 Palmer v. Anderson Infirmary Benevolent Ass'n., 656 So.2d
790, 794 (Miss.1995). A tort is complete when, and personal
jurisdiction lies where, the actual injury occurs. Smith v. Temco,
252 So.2d at 216; see also Rittenhouse v. Mabry, 832 F.2d 1380,
1384 (5th Cir.1987). In determining where the injury occurred for
jurisdictional purposes, actual injury must be distinguished from
its resultant consequences, such as pain and suffering, economic
effects or other collateral consequences that often stem from the
actual injury. Recognizing that such collateral consequences may
be far-reaching (particularly in a commercial tort situation such
as the one before us), our precedent holds that consequences
stemming from the actual tort injury do not confer personal
jurisdiction at the site or sites where such consequences happen to
occur.3 Cycles, 889 F.2d at 619 (tort of conversion did not take
2
The term "injury" commonly denotes the invasion of any
legally protected interest of another. RESTATEMENT (SECOND) OF
TORTS, § 7 (1965). In contrast, the term "damage" is understood
to mean the harm, detriment or loss sustained by reason of an
injury. BLACK'S LAW DICTIONARY 351 (5TH ED.1979).
3
Courts in jurisdictions with long-arm statutes comparable
to that of Mississippi have reached the same result. For
example, the United States District Court for the Southern
District of New York held that the financial consequences of a
conversion are not sufficient to invoke jurisdiction under New
York's long-arm statute. Chemical Bank v. World Hockey Assoc.,
403 F.Supp. 1374, 1380 (S.D.N.Y.1975). In analyzing the site of
the injury, the court in Chemical Bank noted that "in a
commercial tort situation the place of the injury will usually be
deemed to be the place where the critical events associated with
the dispute took place." Id. (internal quotations and citations
omitted). The court concluded that the critical events in that
case were the crucial dealings and negotiations among the parties
(which took place outside of New York). The mere fact that the
plaintiff was located in New York and experienced financial
consequences there did not suffice for long-arm jurisdiction.
Id.; see also Wenz v. Crystal, 55 F.3d 1503, 1508 (10th
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place in whole or in part in Mississippi, even though the plaintiff
may have suffered economic consequences in Mississippi);
Rittenhouse, 832 F.2d at 1384 (plaintiff's continuing pain and
discomfort suffered in Mississippi following her return to the
state did not qualify as a tortious occurrence in Mississippi);
Estate of Portnoy v. Cessna Aircraft Co., 730 F.2d 286, 290 (5th
Cir.1984) (in construing Mississippi's long-arm statute, court held
that a tort occurs when and where the actual injury or accident
takes place, but does not occur at the site of the economic
consequences of that injury); see also Prejean v. Sonatrach, Inc.,
652 F.2d 1260, 1270 (5th Cir.1981).
III
Focusing on the site of ANO's alleged injuries and damages,4
Jobe argues that the nonresident defendants in this case are
subject to long-arm jurisdiction because they committed torts, at
least in part, within the state of Mississippi. Jobe claims that
the defendants were responsible for the following tortious conduct,
which resulted in damages being suffered in Mississippi:
detrimental reliance, disclosure of confidential information in
breach of an agreement, breach of the covenant of good faith and
Cir.1995) (in tort action for wrongful disbursal of funds from a
London account, injury occurred in London; economic consequences
that plaintiff suffered in Colorado were insufficient to
establish personal jurisdiction under the Colorado long-arm
statute).
4
In urging us to find the commission of tortious acts in
Mississippi, Jobe appears to confuse the arguably distinct
concepts of actual injury and damage sustained by reason of an
injury. See supra note 2.
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fair dealing, breach of fiduciary duty, tortious interference with
business relations or prospective business relations, unfair
competition, gross negligence, breach of contract and conspiracy to
defraud. Because ANO lost business, revenues, goodwill and the
ability to grow and prosper within Mississippi, Jobe maintains that
ANO was injured in Mississippi, thereby subjecting the defendants
to the jurisdiction of the district court. Additionally, Jobe
argues that the injury element occurred in the state because
Mississippi travelers were denied the benefits of ANO's flights,
and because a large number of ANO's employees, who were residents
of Mississippi, lost their jobs.
Based on our review of the record and the briefs, and our
consideration of the presentations at oral argument, it is clear to
us that the "injuries" alleged to have occurred in Mississippi are
nothing more than the economic consequences and other miscellaneous
fallout that can be expected to trail in the wake of a failed
airline or other business. Jobe concedes in his brief that no
personal jurisdiction exists if the injury alleged is only a
collateral consequence of extra-state activity. This, however, is
precisely the factual situation reflected in the record before us.
Jobe's pleadings and the statements made in his sworn affidavit
establish that the actual injury (if any) suffered by ANO was an
aborted business deal. This injury occurred and was completed
outside of Mississippi in 1987 when defendant ATR sold a fleet of
approximately fifty-five aircraft to Continental with the alleged
intent of breaching its agreement for the sale of six aircraft to
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ANO. Based on Jobe's pleadings, an actual injury also may have
occurred when and where the defendants misappropriated ANO's
confidential business plan and disclosed that information to ANO's
competitors. Jobe does not claim, and no evidence in the record
indicates, that any of these critical events took place in
Mississippi. Indeed, the record evidence is to the contrary:
ANO's principal place of business when the defendants conducted
their alleged tortious activities was Metairie, Louisiana; the
alleged tortious conduct culminated in ANO's financial ruin and
bankruptcy filing in the Eastern District of Louisiana in January
1988; ANO's actual injuries and many of the economic consequences
resulting from those injuries (including its bankruptcy filing)
occurred well-before ANO attempted to shift its operations from
Louisiana to Gulfport, Mississippi in May 1988. Accepting ANO's
pleadings and allegations as true, it is nonetheless clear on this
record that ANO's actual injuries occurred and were completed
outside of Mississippi.
We therefore hold that the Mississippi injuries alleged by
Jobe are only collateral consequences of ANO's actual injuries.
Having failed to show that the defendants committed a tort in whole
or in part within the state of Mississippi, it follows that there
is no personal jurisdiction pursuant to Mississippi's long-arm
statute over the defendants to this lawsuit. E.g., Cycles, 889
F.2d at 619. The district court's dismissal is
AFFIRMED.
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