COA upholds Indiana jurisdiction in dispute involving German manufacturer

A German water pipe manufacturer did not convince an Indiana Court of Appeals panel on Tuesday that Hoosier courts lack personal jurisdiction to hear a negligence lawsuit brought against the company by a northern Indiana apartment complex.

Renaissance Associates, which owns apartments in Hammond, filed a lawsuit against multiple entities after experiencing ruptures, failures and extensive leaking problems with its polypropylene water pipes. One of the entities sued was Aquatherm GmbH, a German company that manufactured the pipes

Against GmbH specifically, Renaissance alleged negligence arising out of alleged defective design and manufacture of the pipes and failure to warn and/or instruct Renaissance about the defects and the proper and/or safe use of the pipes. Renaissance also alleged it was damaged in an amount totaling at least $413,300 as a proximate result of GmbH’s negligence.

GmbH filed a motion to dismiss for lack of personal jurisdiction, arguing it lacked sufficient minimum contacts with Indiana such that the exercise of jurisdiction would violate the Due Process Clause of the 14th Amendment. A foreign corporation organized in Germany with its principal office located there, GmbH does not own or lease any offices or any other real property in Indiana and is not registered to do business in Indiana.

The company also has no warehouses anywhere in the United States. Thus, GmbH asserted general personal jurisdiction did not exist because it did not have continuous and systematic contacts with Indiana, nor did specific personal jurisdiction exist because it “did nothing more than place its product into the stream of commerce … .”

The Lake Superior Court denied GmbH’s motion to dismiss, finding that although its “coordinated, systematic, marketing plan” might alone not be enough of a minimum contact “to avoid offending traditional notions of fair play and substantial justice,” that marketing plan, combined with GmbH’s 10-year manufacturer’s warranty issued to Renaissance, put GmbH on notice that a breach of warranty might make it liable in the court.

An Indiana Court of Appeals panel affirmed the denial, though it did find that GmbH’s contacts were insufficient to confer general personal jurisdiction.

As to specific personal jurisdiction, however, the appellate court disagreed that GmbH only placed its product into the stream of commerce. It concluded that asserting jurisdiction would not be based on random, fortuitous or attenuated contact with Indiana.

“Considering the relationship ‘among the defendant, the forum, and the litigation,’ … we find that GmbH’s activities, including its online presence and warranty, reflect that it expected or encouraged contacts with Indiana and that it has sufficient contacts with Indiana to support specific personal jurisdiction,” Judge Robert Altice wrote for the appellate court.

“… We find that under these circumstances Indiana has an interest in adjudicating the dispute. According to Renaissance, all the defendants named in the lawsuit, but for GmbH, have consented to jurisdiction in Indiana, and thus Indiana would provide the most convenient and effective location for plaintiff to seek and obtain relief. GmbH has not established or expressly argued the existence of a burden in litigating the matter in Indiana. Judicial economy favors deciding the action in a single action,” the court wrote.

The court therefore concluded in Aquatherm GmbH v. Renaissance Associates I Limited Partnership,19A-PL-981, that Indiana’s exercise of specific personal jurisdiction over GmbH would be fair and comport with federal due process requirements.