United States: Western District Of Washington Finds No Specific Personal Jurisdiction Over MDHI In Connection With Helicopter Crash In Washington State

Last Updated: September 19 2019
Article by J. Denny Shupe

This action arose from a July 22, 2014 non-fatal crash of an MDHI Model 369D helicopter near Oso, Washington. The commercial pilot was performing external load operations in the helicopter when one main rotor blade separated due to disbonding and fatigue cracking, which resulted in loss of control of the helicopter and collision with the terrain. The NTSB attributed the accident to a mechanic's failure to properly perform required inspections of the main rotor blades, as well as to lack of clear guidance in the helicopter maintenance instructions.

The failed rotor blade was manufactured by defendant Helicopter Technology Company ("HTC") and sold by HTC to Olympic Air ("Olympic"). Defendant MDHI, an Arizona corporation with its principal place of business in Arizona, is the current type certificate holder for the 369D helicopter, although the accident helicopter was designed, manufactured and sold by a predecessor company (not MDHI) that previously held the type certificate. MDHI had no involvement with the manufacture or sale of the failed rotor blade to Olympic. MDHI filed a motion to dismiss the amended consolidated complaint on the grounds that there was no personal jurisdiction over it in the state of Washington in connection with this accident. For the reasons discussed below, the federal district court agreed and dismissed the complaint against MDHI.

Courts in the Ninth Circuit employ a three-part test to determine whether there is specific personal jurisdiction over a non-resident defendant: (1) did the defendant purposely direct its activities at the forum; (2) does the claim arise out of or relate to the defendant's forum related activities; and, if the answer to both (1) and (2) is yes, then (3) is the exercise of jurisdiction over the non-resident defendant reasonable? Here, the district court answered no to both (1) and (2), and therefore did not reach question (3).

Among other things, the court noted that as a type certificate holder, MDHI is required to publish safety/service bulletins and produce various manuals for continuing airworthiness, to warn owners and operators of safety issues, and to investigate and notify the FAA of any issue involving flight safety. MDHI argued that being a type certificate holder and meeting these requirements is "geographically agnostic" and "jurisdictionally irrelevant." The court agreed, and found that plaintiffs' allegations about the manufacture of the helicopter by MDHI's predecessor were irrelevant, as were their steam of commerce arguments. The Court also concluded that plaintiffs did not show a connection between any MDHI designs and the state of Washington.

The fact that MDHI had two authorized dealers and service centers in the state of Washington also was an insufficient basis for the court to find specific jurisdiction over MDHI. The court also found insufficient for jurisdiction the fact that Olympic purchased approximately $400,000 worth of MDHI-manufactured parts annually from an MDHI-authorized parts distributor located in California. Significantly, the failed rotor blade was not manufactured or sold by MDHI. Accordingly, the court found that plaintiffs' claims did not arise of MDHI's sale of products and replacement parts in the state of Washington.

Finally, the court found that MDHI's compliance with its federally-imposed continuing airworthiness responsibilities as a type certificate holder was not a basis to find specific jurisdiction. Citing favorably the Tenth Circuit's 2017 decision in Old Republic Ins. Co. v. Cont'l Motors, Inc., 877 F.3d 895, the court held that by MDHI sending manuals and service bulletins to operators and owners of 369D helicopters in Washington, it did not "purposefully avail[] itself of the privilege of conducting activities in the forum" or direct its activities at the state of Washington. MDHI sent materials to Olympic, as it was required to do under federal law, because Olympic was located in Washington; if it had been located elsewhere, then MDHI would have sent the materials elsewhere in compliance with its federal responsibilities. The court held that for specific jurisdiction to be found, "[t]he relationship must arise out of contacts that the 'defendant himself' creates with the forum state." MDHI did not create the contact with Washington when it sent these continuing airworthiness materials to Olympic, an aircraft operator, and to others in Washington. Olympic Air, Inc. v. Helicopter Tech. Co., No. 2:17-CV.1257-RSL, 2019 U.S. Dist. LEXIS 89887 (W.D. Wash. May 29, 2019).

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