We step outside the drug and device world today to report on Davis v. Cranfield Aerospace Solutions, Limited, — F4th –, 2023 WL 4141670 (9th Cir. Jun. 23, 2023), because if you substitute FDA for FAA in this case it is precedent for precluding personal jurisdiction over FDA consultants and others who assist manufacturers in obtaining approval of prescription medical products.
Plaintiffs are the families of three people who died in an airplane crash that occurred in Indiana. Plaintiffs allege the load alleviation system installed on the plane caused the crash. The system was manufactured and installed by a company whose principal place of business was Idaho. In order to obtain the required Federal Aviation Administration certification needed to install the system, the Idaho company retained defendant as a consultant. Defendant is an English company with no offices, employees, or other connection to the United States. Defendant had a relationship with the Idaho manufacturer for six years, over which period of time its employees made two trips to Idaho for test inspections and observation. The rest of defendant’s work was conducted by its employees in England and with the FAA in Washington, D.C. Plaintiffs sued the defendant consultant in Idaho and the district court dismissed for lack of specific personal jurisdiction. The Ninth Circuit affirmed in a 2-1 decision.
The three-part test for specific personal jurisdiction is whether the non-resident defendant “purposefully directs” his activities to or “purposefully avails” himself of the privilege of doing business in the forum state; the claim arises out of or relates to the forum-related activity; and exercising personal jurisdiction must be reasonable. Id. at *4. The majority opinion focused only on the first factor.
To determine purposeful availment the court looks at the “entire course of dealing” with the forum – the contract negotiations, the contract terms, the contemplated consequences, and the parties’ course of dealing. Id. at *5. The foreign consultant did not solicit business from the manufacturer. The manufacturer and the consultant negotiated the contract remotely and it was clear at all times that the work would be conducted by employees in the United Kingdom. So, no purposeful availment in the contract negotiation. As far as the terms of the contract, they are governed by New York law. The only mention of Idaho in the contract is that the consultant was permitted to witness tests and have access to the manufacturer’s facility in Idaho should they find it necessary. Since the primary purpose of the contract was to obtain a certification from the FAA located in Washington, D.C., the contract terms also do not establish purposeful availment.
The contemplated consequences of the contract were that the consultant would provide technical assistance to the manufacturer in obtaining the necessary certification. That was not an action that sought “to benefit from Idaho’s laws.” Id. at *6. Nor was the consultant holding the certifications on behalf of the manufacturer. The court cited a case holding that “legal representation” of an in-forum client does not establish minimum contacts. Id. The court also found persuasive that the manufacturer remained responsible for all modifications, testing, and analysis of the product. As would be true in the case of a manufacturer and FDA consultant for a medical device.
Finally, the court analyzed the course of the parties dealings. The consultant’s employees in the United Kingdom called and emailed frequently with the manufacturer’s employees in Idaho. However, “remote actions taken to service a contract in the forum state seldom lead to purposeful availment by themselves.” Id. at *7. The consultant’s employees also made two trips to the manufacturer’s Idaho facility. Again, that was not enough over the course of a six-year relationship. “[T]ransitory presence will support jurisdiction only if it was meaningful enough to create a substantial connection with the forum State.” Id. “Random, fortuitous, or attenuated” contacts are insufficient to establish jurisdiction. The court found it was undisputed that the bulk of the consultant’s work took place outside the United States.
Plaintiffs made a last-ditch effort to argue that “public policy concerns” should outweigh the “purposeful availment” factors because the United States had an interest in promoting aviation safety within its borders. To that the court replied: “While we are mindful that this appeal stems from tragic circumstances, the does not give us license to dispense with constitutional requirements.” Id. at *8.