Conspiracy Theory of Personal Jurisdiction: Ex Parte the Maintenance Group, Inc.
Ex parte The Maintenance Group, Inc., [Ms. 1160914, Nov. 22, 2017] __ So. 3d __ (Ala. 2017). This decision by Justice Main (Stuart, C.J., and Bolin, Parker, Wise, and Sellers, JJ., concur; Murdock and Bryan, JJ., concur in the result; Shaw, J., dissents) issues a writ of mandamus to the Madison Circuit Court to dismiss The Maintenance Group, Inc. as a defendant based on lack of personal jurisdiction. The Maintenance Group conducted a pre-sale inspection of an aircraft sold by an out-of-state equipment rental company to plaintiff MARC Transport, a Delaware LLC with its principal place of business in Georgia. Ms. *2-3.
MARC sued The Maintenance Group, the seller, and various agents of the seller alleging that certain discrepancies with the aircraft discovered by The Maintenance Group in the pre-sale inspection had not been corrected before closing. Ms. *3-4.
MARC’s claims against The Maintenance Group included claims for negligence, fraud, and conspiracy. Ms. *4.
The plaintiff conceded that it could not show any acts committed by The Maintenance Group in Alabama to support “ordinary” specific jurisdiction. Ms. *19. However, MARC contended that The Maintenance Group should be held subject to personal jurisdiction under a conspiracy theory of jurisdiction. Ibid. The Court noted that under this theory “there must be an overt act or acts in furtherance of the conspiracy committed in Alabama, and that act or those acts must amount to a constitutionally sufficient contact with Alabama that supports specific personal jurisdiction.” Ms. *22-23. The Court rejected plaintiff’s attempt to predicate jurisdiction on the conspiracy theory of jurisdiction holding
In this case, the purported aim of the alleged conspiracy was to “sell the Aircraft to [MARC] without incurring the costs of fully resolving the Discrepancies.” The only contact with Alabama alleged by MARC is that, following MARC’s purchase of the aircraft, Fitch and TAD, MARC’s alleged co-conspirators, routinely transported passengers into and out of Madison County, Alabama, on the aircraft. We agree with Maintenance that this contact alone is insufficient to establish personal jurisdiction as to Fitch or TAD and thus as to Maintenance.
The Court also rejected MARC’s argument because one of its members is an Alabama citizen that MARC should be considered an Alabama plaintiff for purposes of the personal jurisdiction analysis. In this regard, MARC relied on Eleventh Circuit authority holding that a limited liability company’s citizenship is determined by the citizenship of each of its members. The Court held that “the rule for determining citizenship for diversity-jurisdiction purposes has never been extended to the personal-jurisdiction context, and we agree with Maintenance that doing so raises obvious due process concerns. Accordingly, we do not consider the individual citizenship of [plaintiff] MARC’s members in our analysis.” Ms. *26, n. 3.