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Salt River Project Agricultural Improvement and Power District v. Trench France Sas

United States District Court, D. Arizona

November 29, 2017

Salt River Project Agricultural Improvement and Power District, Plaintiff,
v.
Trench France SAS, et al., Defendants.

          ORDER

          David G. Campbell United States District Judge

         Plaintiff Salt River Project filed a complaint against Defendants Trench Limited (“Trench-Canada”) and Trench France, S.A.S (“Trench-France”) for a May 2015 explosion at its Santan Generating Station. Doc. 1. Defendants moved to dismiss the complaint for lack of personal jurisdiction. Docs. 11, 15. At a subsequent hearing, the Court granted Plaintiff's request for limited jurisdictional discovery. Doc. 26. Plaintiff completed that discovery and filed its response. Doc. 44. The motions are fully briefed, and oral argument will not aid the Court's decision. See Fed. R. Civ. P. 78(b); LRCiv 7.2(f). For the reasons that follow, the Court will grant the motion in part.

         I. Background.

         Plaintiff alleges that it sustained damages probably caused by Trench bushing explosions in 2008, 2010, and 2011. Doc. 1 ¶ 8. Trench-France designed the bushings and Trench-Canada manufactured them. Doc. 11 at 20; Doc. 15 at 20. Trench-Canada sold the bushings to Austria-based VA Tech EBG Transformatoren, GmbH & Co. (“VA Tech”) in 2003. Doc. 15 at 20. Plaintiff subsequently purchased VA Tech transformers which included the Trench bushings as component parts. Defendants were not party to this purchase agreement (Doc. 11 at 20; Doc. 15 at 20), but Trench-Canada has sold bushings in Arizona as recently as 2012 through an independent sales representative (Doc. 11 at 21; see Doc. 55-1 at 2-23 (filed under seal)). Its last sale of bushings to Plaintiff was in 2010, although those bushings are not involved in this case. Doc. 11 at 21.

         In response to the first two explosions, Trench-France and Trench-Canada engineers visited Plaintiff's facilities on April 28, 2010. Doc. 1 ¶ 9. Defendants transported the failed bushings from Plaintiff's facilities to plants in France and Canada for testing. See Doc. 45-1 at 17-18; Doc. 55-1 at 44 (filed under seal). In 2014, Trench-Canada requested testing data from Plaintiff. See Doc. 55-1 at 86-89 (filed under seal). Trench-Canada investigated similar bushing failures at other Arizona energy companies in 2011, 2012, and 2013. See Docs. 55-1 at 43-83, 55-2 at 10- 19 (filed under seal).[1]

         Plaintiff decided in 2012 to replace all high-voltage (230 kV and 500 kV) Trench bushings in its system. Doc. 1 ¶ 12. Trench-France subsequently published a 2014 safety advisory that some 230 kV Trench bushings had unusually high failure rates, causing fires and explosions. Doc. 1 ¶ 13; Doc. 45-13. Plaintiff then contacted Defendants to determine the reliability of their lower-voltage bushings. Doc. 1 ¶ 14. Pursuant to Defendants' recommendations, Plaintiff installed monitors on multiple Trench bushings, including 69 kV bushings at the Santan Generating Station. Doc. 1. ¶ 14. The monitors, manufactured by Defendant Doble Engineering Company, were designed to warn Plaintiff of imminent bushing failures. Doc. 1 ¶ 14.

         On May 15, 2015, a Trench 69 kV bushing at Plaintiff's Santan Generating Station exploded without warning, causing approximately three million dollars in damages. Doc. 1 ¶ 15. Plaintiff filed this action alleging negligence and strict products liability against Defendants. Doc. 1 ¶¶ 19-43.

         II. Legal Standard.

         To withstand a 12(b)(2) motion, the plaintiff must show that the defendant is properly subject to the court's jurisdiction. Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218, 1223 (9th Cir. 2011). “Where, as here, the defendant's motion is based on written materials rather than an evidentiary hearing, the plaintiff need only make a prima facie showing of jurisdictional facts to withstand the motion to dismiss.” Id. “The plaintiff cannot ‘simply rest on the bare allegations of its complaint, ' but uncontroverted allegations in the complaint must be taken as true.” Id. (quoting Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004)). In ruling on such a motion, the Court considers the pleadings and any materials submitted by the parties, accepting as true any uncontroverted allegations in the complaint and resolving any factual conflicts in the plaintiff's favor. Id.

         III. Discussion.

         Arizona's long-arm statute, Ariz. R. Civ. P. 4.2(a), applies in this diversity action. See Terracom v. Valley Nat'l Bank, 49 F.3d 555, 559 (9th Cir. 1995). Rule 4.2(a) “provides for personal jurisdiction co-extensive with the limits of federal due process.” Doe v. Am. Nat'l Red Cross, 112 F.3d 1048, 1050 (9th Cir. 1997). “[A] corporation may be subject to personal jurisdiction only when its contacts with the forum support either specific or general jurisdiction.” Martinez v. Aero Caribbean, 764 F.3d 1062, 1068 (9th Cir. 2014) (citing Int'l Shoe Co. v. Washington, 326 U.S. 310 (1945)).

         Plaintiff argues that Defendants are subject to specific jurisdiction. See Doc. 44. Specific jurisdiction exists if a foreign corporation's contacts with the forum give rise or relate to the cause of action before the Court. Daimler AG v. Bauman, 134 S.Ct. 746, 754 (2014). The Ninth Circuit employs a three-prong test to determine whether a non-resident has sufficient minimum contacts for specific jurisdiction:

(1) [T]he defendant must either purposefully direct his activities toward the forum or purposefully avail himself of the privileges of conducting activities in the forum; (2) the claim must be one which arises out of or relates to the defendant's forum-related activities; and (3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e. it must be reasonable.

Axiom Foods, Inc. v. Acerchem Int'l, Inc., 874 F.3d 1064, 1068 (9th Cir. 2017). Plaintiff has the burden of satisfying the first two elements. Id. If it does, Defendants must show that the exercise of ...


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