United States Court of Appeals, Third Circuit, April 9, 2019

OHIO — The appeals for this matter stem from the dismissal of claims filed in the Northern District of Ohio. In 1989 several ship owner defendants moved to dismiss a multitude of merchant mariner claims suits for lack of personal jurisdiction. In sum, the defendants argued that the merchant mariners’ claims for nationwide jurisdiction were invalid. The court found a lack of personal jurisdiction but denied the motions to dismiss and indicated that the court would transfer the cases to the Eastern District of Pennsylvania for the consolidated multi district litigation (MDL). The defendants requested time to contemplate waiving the personal jurisdiction argument to potentially litigate the claims in Ohio. The court ordered the defendants to file answers within a specified timeframe should they wish to waive personal jurisdiction. The defendants did so but noted a protest and continued to assert the personal jurisdiction defense in their answers. In 1991, the cases were transferred to the MDL as authority over those cases was conferred upon the MDL. Several of the cases were reactivated and memorandums were issued as to the personal jurisdiction issue. Those memorandums noted that the defendants had not waived personal jurisdiction. Several of the plaintiffs appealed.

The court noted its authority to dismiss for lack of jurisdiction under FRCP 12. However, the court quickly noted that a defendant’s actions may be construed as a waiver of personal jurisdiction. The court then analyzed whether the MDL abused its discretion when it “concluded that the ship owners had not implicitly waived their personal jurisdiction defenses in Ohio.” The court stated that 1) the defendants introduced the idea of waiver by asking for additional time to consult on litigating in Ohio 2) the ship owner defendants were against the idea of transfer out of Ohio 3) the defendants indeed filed answers in Ohio 4) the defendants did not diligently pursue the defense of personal jurisdiction when they acquiesced in the litigation that was continuing in Ohio. The court concluded that the defendants waived the defense of personal jurisdiction by affirmative conduct and by failure to pursue the defense. As for the MDL, the court found that it applied the incorrect legal standard when it found that the defendants had retained the defense simply by inserting it in their answers. Although retaining the defense in the answer may normally assert and preserve the defense, the procedural history was anything but normal according to the court. Relying on the decision from the Parker case, it had no chose but to create a split amongst circuits when a compelling basis exists. Accordingly, the court reversed the judgment dismissing the merchant mariners’ complaints as the defendants waived and forfeited their personal jurisdiction defense. The decision was followed by a lengthy dissent which pointed out the MDL had in fact relied upon the correct legal standard.

Read the full case decision here.