United States District Court, D. Maine
ORDER ON CANADIAN PACIFIC RAILWAY COMPANY'S
AMENDED MOTION TO DISMISS
LEVY U.S. DISTRICT JUDGE.
of 2013, a freight train operated by the Montreal Maine &
Atlantic Railway, Ltd. (“MMA”), including its 72
carloads of crude oil, derailed in the town of
Lac-Megántic, Quebec, leading to a series of
explosions that destroyed part of the downtown area and
killed 47 people. The next month, MMA filed a chapter 11
Bankruptcy proceeding in this District and simultaneously
sought similar protection in Canada. The derailment also
spawned litigation in both Illinois and Texas, with multiple
plaintiffs (the “Plaintiffs”) asserting claims
for negligence and wrongful death against a multitude of
defendants, all but one of whom, Canadian Pacific Railway
Company (“CP”), have since settled.
cases which comprised the Illinois and Texas litigation are
all now before this court, having been ordered transferred to
the District of Maine by me pursuant to the authority
established in 28 U.S.C. § 157(b)(5). Two cases that
were originally filed in the Circuit Court of Cook County,
Illinois, Roy v. Western Petroleum Co., et al.,
1:14-cv-00113, and Grimard v. Rail World, Inc., et
al., 1:15-cv-00250, were removed to the U.S. District
Court for the Northern District of Illinois before being
transferred to the District of Maine in 2014. Another 35
cases followed the same trajectory from the Circuit Court of
Cook County to the Northern District of Illinois before being
transferred to the District of Maine in 2016,  along with two
cases from the U.S. District Court for the Northern District
of Texas. See Audet, et al. v. Devlar Energy Marketing,
LLC, et al., 1:16-cv-00105-JDL; Boulanger, et al. v.
Arrow Midstream Holdings, LLC, et al.,
1:16-cv-00106-JDL. All 39 cases were eventually consolidated
into the instant case in April 2016. See ECF No.
December 2015, CP filed an Amended Motion to Dismiss the
claims brought by the Plaintiffs in Roy and
Grimard. 1:14-cv-00113, ECF No. 244; 1:15-cv-00250,
ECF No. 79. CP's Amended Motion to Dismiss, along with
the Roy and Grimard plaintiffs'
response and CP's reply, were subsequently deemed filed
in the consolidated case and deemed applicable to all the
Plaintiffs by agreement of all of the parties. ECF No. 1 at
argument on the Amended Motion to Dismiss took place on July
13, 2016. In addition to the Plaintiffs and CP, Robert J.
Keach, the Estate Representative for the Postconfirmation MMA
Estate, made a provisional appearance at the hearing subject
to the court's ruling on his Motion to Intervene (ECF No.
10). I have denied the Motion to Intervene by a separate
raises four bases for dismissal: (1) lack of personal
jurisdiction pursuant to Federal Rule of Civil Procedure
12(b)(2); (2) insufficient service of process pursuant to
Federal Rule of Civil Procedure 12(b)(5); (3) the doctrine of
forum non conveniens; and (4) federal preemption.
For the reasons explained below, the Amended Motion to
Dismiss is granted.
OF PERSONAL JURISDICTION
contends that no United States court has jurisdiction over it
because it owns no tracks in the U.S.; it is not incorporated
in the U.S.; and it does not operate in the U.S., with the
limited exception of bringing some trains a short distance
over the U.S.-Canadian border to hand off the train to the
U.S. employees of its U.S. affiliate. ECF No. 2 at 2. CP also
asserts that these facts, combined with what it asserts is
the lack of any U.S.-based causation to the accident in Lac
Megántic, require dismissal of the Amended Complaint
for lack of personal jurisdiction. Id.
Burden of Production
plaintiff has the burden of establishing personal
jurisdiction over a defendant. Boit v. Gar-Tec Prods.,
Inc., 967 F.2d 671, 674-75 (1st Cir. 1992) (citation
omitted). When a defendant files a motion to dismiss for want
of personal jurisdiction pursuant to Federal Rule of Civil
Procedure 12(b)(2), “a district court may choose from
among several methods for determining whether the plaintiff
has met its burden.” Baskin-Robbins Franchising LLC
v. Alpenrose Dairy, Inc., 2016 WL 3147645, at *3, ___
F.3d ___ (1st Cir. 2016) (quoting Adelson v.
Hananel, 510 F.3d 43, 48 (1st Cir. 2007) (internal
quotation marks omitted); Daynard v. Ness, Motley,
Loadholt, Richardson & Poole, P.A., 290 F.3d 42,
50-51 (1st Cir. 2002)). The “most conventional”
of these methods is the prima facie method, which
“permits the district court to consider only whether
the plaintiff has proffered evidence that, if credited, is
enough to support findings of all facts essential to personal
jurisdiction.” Foster-Miller Inc. v. Babcock &
Wilcox Canada, 46 F.3d 138, 145 (1st Cir. 1995) (quoting
Boit, 967 F.2d at 675) (internal quotation marks
omitted). “The prima facie showing of personal
jurisdiction must be based on evidence of specific facts set
forth in the record, ” Boit, 967 F.2d at 675,
and requires the plaintiff to “go beyond the pleadings
and make affirmative proof[, ]” United States v.
Swiss American Bank, Ltd., 274 F.3d 610, 619 (1st Cir.
2001) (quoting United Elec. Radio & Mach. Workers of
Am. v. 163 Pleasant St. Corp., 987 F.2d 39, 44 (1st Cir.
1993); see also Foster-Miller, 46 F.3d at 145
(“To make a prima facie showing of this calibre, the
plaintiff ordinarily cannot rest upon the pleadings, but is
obliged to adduce evidence of specific
Fifth Amendment Due Process
is no dispute that personal jurisdiction in this case is
governed by the Due Process Clause of the Fifth Amendment
because the court's alleged subject matter jurisdiction
derives from a federal statute, 28 U.S.C.A. § 1452(a)
(2016), insofar as it is “related to” the MMA
bankruptcy. Swiss Am. Bank, 274 F.3d at 618; see
also Auburn Mfg., Inc. v. Steiner Industries, 493
F.Supp.2d 123, 127 (D. Me. 2007). “[U]nder the Fifth
Amendment, a plaintiff need only show that the defendant has
adequate contacts in the United States as a whole, rather
than with a particular state.” Swiss Am. Bank,
274 F.3d at 618 (citing United Elec., Radio & Mach.
Workers, 960 F.2d at 1085).
General and Specific Personal Jurisdiction
since the Supreme Court's opinion in International
Shoe Co. v. State of Washington, 326 U.S. 310 (1945),
courts have divided the personal jurisidiction analysis into
two parts: “general” and “specific”
personal jurisdiction. Donatelli v. Nat'l Hockey
League, 893 F.2d 459, 462-63 (1st Cir. 1990) (citing
Int'l Shoe, 326 U.S. 310). General jurisdiction
exists when the defendant has engaged in “continuous
and systematic activity” in the forum. Harlow v.
Children's Hosp., 432 F.3d 50, 64 (1st Cir. 2005).
Specific jurisdiction exists when “the cause of action
. . . arises directly out of, or is related to, the
defendant's forum-based contacts.” Id. at
60-61. For both categories of personal jurisdiction, the
defendant must have sufficient “minimum contacts”
with the forum; those contacts must be purposeful; and the
exercise of jurisdiction must be reasonable under the
circumstances. Id. at 57. See also Goodyear
Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915,
General Personal Jurisdiction
may exercise general personal jurisdiction over a foreign
corporation “only when the corporation's
affiliations with the State in which suit is brought are so
constant and pervasive as to render it essentially at home in
the forum State.” Daimler AG v. Bauman, 134
S.Ct. 746, 751 (2014) (quotation omitted). “[I]f such
contacts do not exist in sufficient abundance, the general
jurisdiction inquiry ends.” In re New Motor
Vehicles Canadian Export, 307 F.Supp.2d 145, 150 (D. Me.
2004) (citing Donatelli, 893 F.2d at 465).
Amended Complaint alleges that CP is a “Canadian
company, headquartered in Calgary, Alberta, Canada, with
corporate offices in Minneapolis, Minnesota, and [which]
operates trains throughout Canada and the United
States[.]” Case No. 1:14-00113, ECF No. 182 at 5,
¶ 6. The Amended Complaint also alleges that CP
is a “transportation, logistics, and management company
which maintains over 14, 000 miles of track extending
throughout Canada and into the U.S. industrial centers of
Chicago, Newark, Philadelphia, Washington, New York City, and
Buffalo.” Id. at 38, ¶ 184.
argues in its Motion to Dismiss that none of these pleaded
facts render it “at home” in the United States.
ECF No. 2 at 13. It notes that while the Amended Complaint
correctly alleges that it is a Canadian company that is
headquartered in Canada, “[a]llegations about CP having
corporate offices in Minnesota, and operating trains
throughout the United States, including the State of Illinois
are simply false.” Id. (quotation marks
omitted). CP also submitted the Affidavit of James Clements,
its Vice President of Planning and Transportation Services,
who states under oath that CP is the operating subsidiary of
Canadian Pacific Railway Limited, which is also a Canadian
corporation, and that “CP conducts almost no business
in the United States.” ECF No. 2-3 at 1. Clements
states that CP train crews do not operate trains in the
United States, “except for limited operations . . .
where CP crews dismount and turn the train over to crews
employed by a U.S. subsidiary.” Id. at 2.
opposing CP's motion to dismiss, the Plaintiffs contend
that the allegations contained in the Amended Complaint
properly encompass the activities of both CP and its U.S.
affiliates. ECF No. 2-11 at 3-4. They also accuse CP of
engaging in a “shell game of identifying its affiliates
as ‘doing business as CP.'” Id. at
3. Yet the Plaintiffs do not dispute the Clements Affidavit,
nor offer evidence or legal authority to explain how the fact
that CP and its affiliates do business under the same trade
name is improper or renders CP “at home” in the
United States. See ECF No. 2-11.
Plaintiffs' have fallen short of what is required to make
a prima facie showing of general personal jurisdiction
because they have failed to “adduce evidence of
specific facts” and instead have simply rested upon the
pleadings. Foster-Miller, 46 F.3d at 145; Swiss
American Bank, 274 F.3d at 619; Boit, 967 F.2d
at 675. The undisputed record evidence establishes that CP is
a Canadian corporation without continuous and systematic
activity in the United States. The undisputed record evidence
establishes that CP is a Canadian corporation without
continuous and systematic activity in the United States.
Cf. Waldman v. Palestine Liberation Org., ___ F.3d
___, 2016 WL 4537369, at *12 (2d Cir. Aug. 31, 2016) (Record
evidence demonstrated that defendants were not “at
home” in the United States, where they were directed
from and headquartered abroad). For this reason, I conclude
that the Plaintiffs have not met the constitutional threshold
for the court to exercise general personal jurisdiction over
Specific Personal Jurisdiction
jurisdiction allows a court to hear a particular case as long
as “that case relates sufficiently to, or arises from,
a significant subset of contacts between the defendant and
the forum.” Phillips Exeter Acad. v. Howard
Phillips Fund, Inc., 196 F.3d 284, 288 (1st Cir. 1999)
(citing Helicopteros Nacionales de Colombia, S.A. v.
Hall, 466 U.S. 408, 414 (1984)). To determine whether
specific jurisdiction exists in a given case, the court first
must determine whether the claim at issue in the litigation
“directly relates to or arises out of the
defendant's contacts with the forum[, ]” and if so,
“whether those contacts constitute purposeful availment
of the benefits and protections afforded by the forum's
laws.” Swiss Am. Bank, 274 F.3d 610, 620-21
(1st Cir. 2001) (quoting Phillips Exeter, 196 F.3d
at 288). If these two requirements are met, the court must
then determine whether the exercise of specific jurisdiction
would be reasonable “in light of a variety of pertinent
factors that touch upon the fundamental fairness of an
exercise of jurisdiction.” Id. at 621.
prima facie support for CP's contacts with the
United States, the Plaintiffs point to the undisputed fact
that the train that derailed in Lac Megántic travelled
from North Dakota and through Illinois and other states
before entering Canada. ECF No. 2-11 at 21. The Plaintiffs
also cite the following statement that CP made before the
Bankruptcy Court, in which it admitted that its U.S.
subsidiaries operated the train: “CP subsidiaries,
doing business as Canadian Pacific or Canadian Pacific
Railway, conduct U.S. operations, including movement of the
train that ultimately derailed from North Dakota to the
Canadian border.” Id. (citing Keach v.
World Fuel Svcs. Corp. (the “Adversary
Proceeding”), Bankr. Case No. 14-01001; CP's Motion
to Dismiss the Adversary Proceeding, ECF No. 140-1 at 4).
Neither this statement nor the undisputed fact that the train
passed through several U.S. states constitutes evidence that
CP, as opposed to its subsidiaries, did or failed to do
anything on U.S. soil, and thus, neither supports the
Plaintiffs' prima facie argument that CP had
sufficient U.S. contacts for specific jurisdiction to exist.
In fact, CP's statement tends to weaken the
Plaintiffs' argument because it asserts that it was
CP's U.S. subsidiaries, and not CP, that operated the
train in the United States. See Adversary
Proceeding, Bankr. Case No. 14-1001, ECF No. 140 at 4.
the Plaintiffs cite their allegation that CP
“mislabeled the oil in the train or failed to take
appropriate action in the United States to prevent the oil
from exploding in the subsequent derailment[.]” ECF No.
2-11 at 21. For the same reasons discussed above, this
allegation in the Amended Complaint, standing alone, does not
support specific jurisdiction because, under the prima
facie method, a plaintiff opposing a motion to dismiss
for want of personal jurisdiction must “go beyond the
pleadings and make affirmative proof.” Swiss
American Bank, 274 F.3d at 619; Boit, 967 F.2d
at 675; see also Foster-Miller, 46 F.3d at 145. For
this reason, I conclude that the Plaintiffs have not met
their burden of production for establishing specific personal
Existence of Personal Jurisdiction in the Bankruptcy Court
Plaintiffs also argue that CP is subject to either or both
general and specific jurisdiction in this case because the
Bankruptcy Court “considered, and rejected”
CP's personal jurisdiction arguments and ruled that CP
was amenable to the exercise of personal jurisdiction in the
Adversary Proceeding. ECF No. 2-11 at 20 (citing the
Adversary Proceeding, Bankr. Case No. 14-01001, ECF No. 152;
ECF No. 154). The Plaintiffs contend that because the
Bankruptcy Court is a unit of the District Court pursuant to
28 U.S.C.A. § 151 (2016), the Bankruptcy Court's
finding applies in this case “for the same reasons, and
to the same extent[.]” Id.
concedes that personal jurisdiction was found to exist in the
Adversary Proceeding, but maintains that the Bankruptcy Court
never “considered and rejected” its personal
jurisdiction arguments. ECF No. 2-15 at 2-3. CP also argues
that the Bankrutpcy Court's analysis did not rely upon
CP's alleged contacts with the United States. ECF No.
2-13 at 14. Instead, CP contends that the Bankruptcy Court
ruled that it effectively consented to personal jurisdiction
by participating in the Adversary Proceeding. ECF No. 2-15 at
3 (citing the Adversary Proceeding, Bankr. Case No. 14-1001,
ECF No. 162 at 32-33). Consent to jurisdiction in one
proceeding, CP argues, does not waive the right to assert
lack of personal jurisdiction in another case. Id.
(citing Akanani v. Aegis Defense Servs., LLC, 976
F.Supp.2d 13, 37 n.10 (D.D.C. 2014)).
Bankruptcy Court's personal jurisdiction determination in
the Adversary Proceeding is not controlling in this case
because the Bankruptcy Court concluded that specific
jurisdiction existed based on CP having filed a proof of
claim. Adversary Proceeding, Bankr. Case No. 14-1001, ECF No.
162 at 32. The Bankruptcy Court's order made no mention
of the contacts alleged by the Plaintiffs in this case, i.e.,
that CP operates a railroad network throughout the United
States and mislabeled the oil on board the train or otherwise
failed to take appropriate action in the United States to
prevent the oil from exploding. See Id. Furthermore,
the Plaintiffs do not argue that CP's consent to
jurisdiction in the Adversary Proceeding was a knowing and
intelligent agreement to personal jurisdiction in this case,
and they have not identified how such a conclusion should be
implied by operation of law. See ECF No. 2-11.
Plaintiffs also raise the doctrine of judicial estoppel as a
basis for finding personal jurisdiction in this case.
filed an Objection to the Trustee's July 15, 2015, Plan
of Liquidation (the “Confirmation Objection”) in
the MMA Bankruptcy, Bankr. Case No. 13-10670, ECF No. 1657,
in which it argued that the proposed liquidation plan would
“forcibly depriv[e] CP of the contractual indemnity and
setoff rights” owed to it by Western ...