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Knox v. Metalforming, Inc.

United States Court of Appeals, First Circuit

January 30, 2019

STEPHEN D. KNOX; JEAN KNOX, Plaintiffs, Appellants,
METALFORMING, INC., Defendant, Appellant, SCHECHTL MASCHINENBAU GMBH, Defendant, Appellee.


          Benjamin R. Zimmermann, with whom Stacey L. Pietrowicz and Sugarman and Sugarman, P.C. were on brief, for Stephen and Jean Knox.

          Javier F. Flores, with whom Eric V. Skelly, Thaddeus M. Lenkiewicz, and Manning Gross & Massenburg LLP, were on brief, for MetalForming, Inc.

          Frederick W. Reif, with whom Marie E. Chafe, Cornell & Gollub, Debra Tama, and Wilson Elser Moskowitz Edelman & Dicker, LLP, were on brief, for Schechtl Maschinenbau GmbH.

          Before Lynch, Stahl, and Barron, Circuit Judges.


         Stephen Knox's hand was badly injured at his work at Cape Cod Copper (CCC) in October 2016 when he operated a machine that was manufactured by defendant Schechtl Maschinenbau GmbH, a German company. The machine had been sold to CCC by defendant MetalForming, Inc., an American company located in Georgia and Schechtl's U.S. distributor.

         The question on appeal is whether there is personal jurisdiction over Schechtl, named as a defendant by Knox and as a cross-claim defendant by MetalForming. The district court dismissed the claims against Schechtl, finding that Schechtl had not purposefully availed itself of the privilege of doing business in Massachusetts. Knox v. MetalForming, Inc., 303 F.Supp.3d 179, 184 (D. Mass. 2018).

         We reverse.


         A. Background

         The district court did not permit jurisdictional discovery. Id. at 187. The following facts are undisputed.

         In October 2016, Stephen D. Knox, plaintiff here along with his wife, Jean, was injured while using a Schechtl MAX 310, [1]a motor-driven metal-bending machine. The injury occurred at CCC, Knox's place of employment, located in Lakeville, Massachusetts. When Knox inadvertently hit the foot pedal of CCC's MAX 310, the machine activated, crushing his left hand.

         Schechtl, the manufacturer of the MAX 310, is headquartered in Edling, Germany and maintains no operations in the United States. The company's marketing materials say that Schechtl manufactures the "most popular architectural sheet metal folders in the world."

         Schechtl sells its machines to United States customers through MetalForming, a separate and independently owned U.S. distribution company. Schechtl's distribution agreement ("the agreement") with MetalForming gives MetalForming the exclusive right to distribute Schechtl's products in the "Contract Territory," which comprises Canada, the United States, and Mexico.

         The agreement outlines the procedure for selling Schechtl's machinery. The purchasing end user ("the purchaser") places an order with MetalForming, which in turn acquires the machine from Schechtl. MetalForming then sends a purchase order, naming the purchaser, to Schechtl in Germany. Under the agreement, MetalForming must include "technical and other data" in the purchase order, because that information is "of importance for the ordered product, the supply contract, and its performance."

         Schechtl then chooses whether to accept the purchase order. If it does accept, it issues a written order confirmation, which "govern[s] the product to be delivered, its technical qualities, the delivery price, the place of delivery, the time of delivery as well as all other relevant contractual provisions."

         Schechtl then manufactures the machine to the purchaser's specifications. The agreement provides that Schechtl "reserves the right, in the exercise of its sole discretion, to discontinue the manufacture or distribution of any Product without incurring any obligation to [MetalForming]."

         When the machine is ready, Schechtl delivers it to a "freight forwarder or other transport agency" in Germany, at which point ownership passes to MetalForming. The record does not detail the ordinary shipment process after that point, but, as we describe below, it does show how the MAX 310 that injured Knox came to CCC.

         Under the agreement, MetalForming is responsible for installation at the purchaser's site and for training the purchaser's personnel in the proper use of the machine. The agreement does, however, provide that it may "become necessary that installation work be conducted under the direction of a" Schechtl technician. And there is ...

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