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There were insufficient facts to determine whether personal jurisdiction existed over Samsung SDI in a product liability lawsuit where one of the company’s batteries allegedly exploded in a minor’s pocket, the 7th Circuit Court of Appeals ruled Wednesday.
The case centers on Samsung SDI’s 18650 lithium-ion battery, which looks like a common AA battery but is rechargeable and holds more power.
Samsung SDI maintains that it does not sell 18650 batteries to individuals. It does not design or market 18650 batteries to be used individually, does not advertise or market 18650 batteries to consumers in Indiana, and has never personally or directly shipped an 18650 battery to an Indiana address.
However, Samsung SDI is aware of a particular danger associated with individual consumers’ use of lithium-ion batteries in e-cigarettes. If the device malfunctions, the battery can be “shot out like a bullet or rocket.”
In 2019, Bryan Myers purchased a Samsung SDI 18650 lithium-ion battery to use in an e-cigarette. He bought the individual battery at a retail e-cigarette store in Indiana.
The record does not reveal how the store obtained the battery, but Samsung SDI avers it “never conducted any business with any retail store in Indiana.”
Shortly after purchase, Myers gave the battery to his stepson, B.D. At some point while the battery was in B.D.’s pocket, it exploded, and B.D. suffered severe burns.
B.D., through Myers, brought a product liability suit against Samsung SDI in Knox Circuit Court.
Samsung SDI removed the case to federal court, then moved to dismiss the complaint for lack of general and specific personal jurisdiction.
The United States District Court for the Southern District of Indiana denied the motion to dismiss, prompting the instant appeal.
On appeal, the 7th Circuit remanded the case for further jurisdictional discovery, ruling that the district court should permit discovery about Samsung SDI’s contacts with Indiana concerning B.D.’s claimed injuries.
“This remand is limited to the question of personal jurisdiction and does not independently obligate the district court to consider or reconsider any non-jurisdictional issues,” the 7th Circuit’s per curiam opinion stated.
According to the 7th Circuit, the sole issue before the district court is whether specific personal jurisdiction existed in the case.
The district court found that Samsung SDI has sufficient contacts with Indiana to permit the exercise of specific personal jurisdiction over B.D.’s claims; that a sufficient nexus exists between Samsung SDI’s marketing of the 18650 lithium-ion battery in Indiana and B.D.’s alleged injuries; and that exercise of specific personal jurisdiction over Samsung SDI would not offend traditional notions of fair play and substantial justice.
The 7th Circuit also pointed to Ford Motor Co. v. Mont. Eighth Jud. Dist. Ct., which clarified that a defendant’s contacts with the forum may “relate to” the plaintiff’s claims even in the absence of a “strict causal relationship” between the contacts and claims.
“The district court relied primarily on the stream-of-commerce theory and Ford to find specific personal jurisdiction in this case. But the record does not contain sufficient facts to assess whether the requirements of the stream-of-commerce theory are met here, and Ford is distinguishable,” the 7th Circuit ruled.
Further, the record does not show that Samsung SDI advertised, sold or serviced 18650 batteries in Indiana. While B.D. alleges Samsung SDI sells those batteries to Indiana consumers through third-party websites and vendors, what Samsung SDI knew or expected about the 18650 batteries entering Indiana is unclear.
“Again, addressing this question would help decide whether specific personal jurisdiction exists here over Samsung SDI,” the opinion states.
According to the 7th Circuit, jurisdictional discovery could also yield facts as to whether Samsung SDI’s contacts with Indiana are related to the alleged injury suffered in the complaint.
Finally, the appellate court stated that jurisdictional discovery is proper if a plaintiff establishes a colorable or prima facie showing of personal jurisdiction, citing Cent. States, Se. & Sw. Areas Pension Fund v. Phencorp Reinsurance Co., 440 F.3d 870 (7th Cir. 2006).
“B.D. has offered a colorable showing of Samsung SDI’s minimum contacts, which warrants a limited remand for jurisdictional discovery. B.D. has alleged that Samsung SDI put its 18650 batteries into the stream of commerce with the intent and knowledge that they would reach Indiana,” the 7th Circuit concluded.
The case is B.D., a minor, by and through his guardian ad litem, Bryan Myer v. Samsung SDI Co., LTD, 23-1024.
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