United States District Court, D. Colorado
A. BRIMMER Chief United States District Judge.
matter is before the Court on Defendants' R.D. Offutt
Company, R.D. Offutt Farms Co., and R.D. Offutt
Company-Northwest Joint Motion to Dismiss for Lack of
Personal Jurisdiction Pursuant to Fed.R.Civ.P. 12(b)(2)
[Docket No. 23]. The court has subject matter jurisdiction
over this matter pursuant to 28 U.S.C. § 1332.
about April 20, 2016, plaintiff became ill after consuming
frozen vegetables grown, processed, packaged, and distributed
by defendants CRF Frozen Foods, LLC, Costco Wholesale
Corporation, R.D. Offutt Company, and R.D. Offutt
Company-Northwest. Docket No. 4 at 6, ¶¶ 34-39. On
April 23, 2016, CRF Frozen Foods LLC issued a recall of
several types of frozen vegetables potentially contaminated
by Listeria. Id. at 4, ¶ 9. After additional
medical testing, doctors determined that plaintiff's
symptoms were the result of a Listeria infection.
Id. at 6, ¶ 40.
filed this lawsuit in the District Court for Boulder County,
Colorado on May 10, 2018. Docket No. 1-2 at 2. The complaint
asserts seven claims against defendants CRF Frozen Foods LLC
(“CRF”), Costco Wholesale Corporation
(“Costco”), R.D. Offutt Company (“RDO
Company”), R.D. Offutt Company - Northwest (“RDO
Northwest”), R.D. Offutt Farms Co. (“RDO
Farms”), and Does 1-25: (1) breach of express warranty;
(2) breach of implied warranty for a particular purpose; (3)
breach of implied warranty of merchantability; (4) violation
of the Colorado Consumer Protection Act, Colo. Rev. Stat.
§ 6-1-101 et seq.; (5) strict product
liability; (6) negligent product liability; and (7)
negligence. Docket No. 4 at 7-14. On June 6, 2018, defendants
CRF, RDO Company, RDO Northwest, and RDO Farms removed the
case to this Court on the basis of diversity jurisdiction.
Docket No. 1 at 3, ¶ 10. On July 3, 2018, defendants RDO
Company, RDO Northwest, and RDO Farms (collectively, the
“RDO defendants”) moved to dismiss the claims
asserted against them for lack of personal jurisdiction under
Fed.R.Civ.P. 12(b)(2). Docket No. 23. Plaintiff filed a
response to the motion on August 9, 2018, Docket No. 31, to
which the RDO defendants replied on August 23, 2018. Docket
purpose of a motion to dismiss under Rule 12(b)(2) is to
determine whether the Court has personal jurisdiction over a
defendant. The plaintiff bears the burden of establishing
personal jurisdiction. Rambo v. Am. S. Ins. Co., 839
F.2d 1415, 1417 (10th Cir. 1988). The plaintiff can satisfy
its burden by making a prima facie showing. Dudnikov v.
Chalk & Vermilion Fine Arts, Inc., 514 F.3d 1063,
1070 (10th Cir. 2008).The Court will accept the well-pleaded
allegations of the complaint as true in determining whether
plaintiff has made a prima facie showing that personal
jurisdiction exists. AST Sports Sci., Inc. v. CLF
Distribution Ltd., 514 F.3d 1054, 1057 (10th Cir. 2008).
If the presence or absence of personal jurisdiction can be
established by reference to the complaint, the Court need not
look further. Id. The plaintiff, however, may also
make this prima facie showing by putting forth evidence that,
if proven to be true, would support jurisdiction over the
defendant. Dudnikov, 514 F.3d at 1070. “[A]ny
factual disputes in the parties' affidavits must be
resolved in plaintiffs' favor.” Id.
determining whether a federal court has personal jurisdiction
over a defendant, the court must determine (1) whether the
applicable statute potentially confers jurisdiction by
authorizing service of process on the defendant and (2)
whether the exercise of jurisdiction comports with due
process.” Niemi v. Lasshofer, 770 F.3d 1331,
1348 (10th Cir. 2014); Trujillo v. Williams, 465
F.3d 1210, 1217 (10th Cir. 2006) (quoting Peay v.
BellSouth Med. Assistance Plan, 205 F.3d 1206, 1209
(10th Cir. 2000)). The Colorado long-arm statute, Colo. Rev.
Stat. § 13-1-124, has been construed to extend
jurisdiction to the full extent permitted by the
Constitution, so the jurisdictional analysis here reduces to
a single inquiry of whether jurisdiction offends due process.
See Pro Axess, Inc. v. Orlux Distrib., Inc., 428
F.3d 1270, 1276 (10th Cir. 2005); Archangel Diamond Corp.
v. Lukoil, 123 P.3d 1187, 1193 (Colo. 2005). Personal
jurisdiction comports with due process where a defendant has
minimum contacts with the forum state and where those
contacts are such that assuming jurisdiction does not offend
“traditional notions of fair play and substantial
justice.” Int'l Shoe Co. v. Wash., 326
U.S. 310, 316 (1945). Minimum contacts may be established
under the doctrines of general jurisdiction or specific
jurisdiction. Where general jurisdiction is asserted over a
nonresident defendant who has not consented to suit in the
forum, minimum contacts exist if the plaintiff demonstrates
that the defendant maintains “continuous and systematic
general business contacts” in the state. OMI
Holdings, Inc. v. Royal Ins. Co. of Canada, 149 F.3d
1086, 1091 (10th Cir. 1998).
jurisdiction is present only if the lawsuit “aris[es]
out of or relat[es] to the defendant's contacts with the
forum.” Bristol-Myers Squibb Co. v. Superior Court
of Calif., San Francisco Cty., 137 S.Ct. 1773, 1780
(2017). The specific jurisdiction analysis is two-fold.
First, the Court must determine whether a defendant has such
minimum contacts with Colorado that the defendant
“should reasonably anticipate being haled into
court” here. World-Wide Volkswagen Corp. v.
Woodson, 444 U.S. 286, 297 (1980). Within this inquiry,
the Court must determine whether the defendant purposefully
directed its activities at residents of the forum, Burger
King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985), and
whether plaintiff's claim arises out of or results from
“actions by . . . defendant . . . that create a
substantial connection with the forum State.” Asahi
Metal Indus. Co. v. Superior Court of Cal., 480 U.S.
102, 109 (1987) (internal quotations omitted). Second, if
defendant's actions create sufficient minimum contacts,
the Court must consider whether the exercise of personal
jurisdiction over defendant offends “traditional
notions of fair play and substantial justice.”
Id. at 105.
parties' dispute in this case focuses on the
“minimum contacts” requirement. The RDO
defendants are a group of related entities involved in the
production and distribution of agricultural products.
See Docket No. 4 at 3, ¶¶ 4-5; Docket No.
23-1 at 1, ¶ 3 (stating that RDO Company is the parent
company of RDO Northwest); Docket No. 23-2 at 2, ¶ 4
(stating that RDO Farms is a parent company of RDO
Northwest); Docket No. 23-3 at 1, ¶ 3 (stating that RDO
Northwest is a subsidiary of RDO Company and RDO Farms).
According to declarations submitted by the RDO defendants,
the RDO defendants are not registered to do business in
Colorado, do not maintain a physical presence in Colorado, do
not maintain agents for service of process in Colorado, and
do not have any employees in Colorado. Docket No. 23-1 at 2,
¶¶ 9-13; Docket No. 23-2 at 2, ¶¶ 10-14;
Docket No. 23-3 at 2-3, ¶¶ 12-17. While plaintiff
does not dispute these assertions, she argues that the Court
may exercise personal jurisdiction over the RDO defendants
based on their subsidiaries' contacts with Colorado.
See Docket No. 31 at 1 (arguing that “R.D.
Offutt Company has purposely directed its activities in the
State of Colorado through its
subsidiaries”). Plaintiff focuses on three sets of
corporate relationships: (1) the relationship between RDO
Company and CSS Farms LLC (“CSS Farms”); (2) the
relationship between RDO Company, Farm Fresh Direct LLC
(“Farm Fresh Direct”), and Growers Sales and
Marketing, LLC d/b/a Farm Fresh Direct of America; and (3)
the relationship between the RDO defendants and CRF.
See Docket No. 31 at 4-5.
RDO Defendants' Relationship With CSS Farms
asserts that RDO Company “built a seed potato operation
in Colorado City, Colorado around 2006 called CSS Farms,
” which grew seeds for Frito-Lay, a company whose
“products [are] widely distributed to Colorado
consumers.” Docket No. 31 at 4. In support of these
assertions, plaintiff cites a 2006 article from
Agweek which states that
[t]he company recently built a seed potato operation in
Colorado City, Colo., that provides disease-free stem
cuttings for his potato operations nationwide as well as for
others. Half of the seed grown for potato snack giant
Frito-Lay comes from Offutt's CSS Farms.
Docket No. 31-2 at 2. Defendants respond that the minimum
contacts between CSS Farms, “a farming company Ron
Offutt once held a partial interest in, ” subsidiaries
of RDO Farms, and Colorado residents do not “even
remotely relate to the events that gave rise to this
litigation.” Docket No. 32 at 5. Defendants also submit
a declaration from Loren Stahl, Director of Risk Management
for RDO Company, clarifying the relationship between the
various RDO defendants and CSS Farms. See Docket No.
32-2. According to the declaration, the only connection
between the RDO defendants and CSS Farms is the fact that Ron
Offutt once held an ownership interest in CSS Farms. See
Id. at 3-4. However, Mr. Stahl states that Mr. Offutt
“sold his entire interest in CSS Farms LLC in August
2007.” Id. at 3, ¶ 10.
Court finds that plaintiff has failed to make a prima facie
showing of either general or personal jurisdiction based on
the RDO defendants' relationship with CSS Farms. Though
not clear, the Court interprets plaintiff's response as
asserting three theories of personal jurisdiction based on
RDO Company's relationship with CSS Farms: (1) a direct
availment theory, under which RDO Company has sufficient
direct contacts with Colorado because it “built”
CSS Farms; (2) an agency theory, under which CSS Farms'
contacts with Colorado as agent for RDO Company can be
imputed to RDO Company; and (3) ...