
The Takeaway
- In an age of globalization and outsourcing, firms frequently do not manufacture their own products, leading to questions as to who is responsible when a defect is found.
- A recent Indiana decision hinging on personal jurisdiction in talc litigation suggests that the answer to this dilemma may be more complicated than previously thought, at least with respect to out-of-state suppliers.
- In PTI Union, LLC, et al v. McBride,[1] the Court of Appeals reversed the trial court and concluded that none of the non-resident appellant-defendants were subject to personal jurisdiction in Indiana, under either general or specific personal jurisdiction.
- While this case naturally causes plaintiffs concern as to how to seek relief against out-of-state producers, it likewise leaves defendants uncertain as to when they may be subject to specific jurisdiction in Indiana.
- In light of the lack of a clear and objective test of when “something more” is present, it’s likely that this issue will remain unresolved, unless and until the legislature chooses to act and codify a new standard.
- Defense tip: Defendants should remember that “less is more,” and the fewer dealings a party has with a forum state, the better its odds are of defending on personal jurisdiction grounds.
Case Background
In August 2021, Ronald McBride was diagnosed with malignant pleural mesothelioma. In October, he and his wife filed suit in Marion County (Indiana) Superior Court, alleging Ronald’s disease was the direct and proximate result of asbestos-containing talcum powder products he used from 1970 through 2021, including in Indiana.
After Ronald’s death in November 2022, his wife amended her Complaint to add seven defendants, who were the Appellants in this case:
- PTI Union, LLC (PTI) - a Delaware limited-liability company with its principal place of business in Missouri.
PTI is a contract manufacturer that blends and bottles products (including talcum powder) to the specifications of its customers, including Insight Pharmaceuticals (a Pennsylvania company, which was not a party to the appeal). According to Plaintiff, over 200,000 bottles of a particular talc product were shipped from PTI’s Missouri facility to a warehouse in Plainfield, Indiana, “over a period of years.”
2. Black Creek Corporation (BCC) - formerly a Missouri corporation with its principal place of business in Missouri. This corporation dissolved in 2012.
BCC is PTI’s predecessor. In 2005, it manufactured 125,000 bottles of the same product for Insight, which were then shipped to a warehouse in Plainfield.
3. Broadview Investments, LLC (Broadview) - a Delaware limited-liability company with its principal place of business in Georgia.
Broadview was alleged to be the holding company of PTI.
4. Edward T. Noland, Jr. Irrevocable Gifting Trust
5. Tarrasch Family Trust
6. Revocable Living Trust of Edward T. Noland, Jr.,
7. Laura Noland Tarrasch Revocable Trust
Collectively, “the Trusts,” these were alleged to comprise the entirety of BCC’s membership. None of the trusts were created in Indiana, and none of the trustees live in Indiana.
Trial Court Proceedings
In May 2023, PTI filed a motion to dismiss the complaint under Indiana Trial Rule 12(B)(2) for lack of personal jurisdiction. To support its motion, PTI attached an affidavit from its Director of Quality that claimed that Insight directed the entirety of the product’s specifications, shipments, distribution, labeling, final release, marketing, and sale to consumers.
PTI argued it was not subject to general jurisdiction in Indiana because it’s neither incorporated in nor maintains its principal place of business in Indiana. Similarly, it argued that it wasn’t subject to specific jurisdiction because “[i]ts role with respect to [the product] ended at its Union, Missouri[,] loading docks, from which point [the product] was a product owned and controlled by Insight.” (Appellants’ App. Vol. III. P. 122) (internal citations omitted in original).
BCC, Broadview, and the Trusts also moved to dismiss for lack of personal jurisdiction.
Following oral argument, the trial court denied the various motions.
In denying PTI’s motion, the trial court relied heavily upon the contract between PTI and Insight, under which PTI bore responsibility for:
- maintaining the proper condition of all raw materials
- manufacturing and packaging of the product
- reporting any deviations in the product
- transporting the manufactured product under the appropriate environmental conditions
- documenting the Product Acceptance procedure signed certificate of analysis, certificate of conformance, and various certificate[s] of compliance or approval for Insight
The trial court further noted that Insight’s product orders from PTI included 125,000 containers delivered to Plainfield, Indiana, in May 2005, followed by multiple orders for bottles in 2009, 2010, and 2011.
Based on this ongoing contractual relationship for the production of the product and regular shipments to Indiana over the years, the trial court concluded there “was a substantial connection to Indiana such that PTI could reasonably anticipate being called into court here to defend itself for an inquiry caused by the product they manufactured.” Appellants’ App. Vol. VI pp. 5-6 (record citations omitted).
Similarly, the trial court found that BCC’s shipping of 125,000 bottles to Indiana in 2005 also supported a finding of an ongoing contractual relationship, and that the volume of product shipped to Indiana during the contract’s term “supports a finding of a substantial connection to Indiana such that Black Creek could reasonably anticipate being called into court here to defend itself for an injury caused by the product they manufactured.” Id. at 6-7 (record citations and footnote omitted in original).
Lastly, with respect to Broadview and the Trusts, the Court found that Broadview is the sole member and holding company of PTI, and the four Trusts constitute Broadview’s membership. Id. at 7 (record citations omitted in original).
PTI moved to certify the trial court’s order for interlocutory appeal, after which BCC, Broadview and the Trusts moved to join, and the Court of Appeals accepted jurisdiction.
Appellate Court Ruling
In reviewing a Rule 12(B)(2) challenge, based on a written record and oral argument, Indiana appellate courts apply de novo review. See Munster v. Groce, 829 B.E.2d 52, 57 (Ind. Ct. App. 2005). When a defendant challenges the existence of personal jurisdiction, the plaintiff must provide evidence of the trial court’s jurisdiction. Aquatherm GmbH v. Renaissance Assocs. I Ltd. P’ship, 140 N.E.3d 349, 357 (Ind. Ct. App. 2020). However, unless it’s found within the face of the complaint, the defendant ultimately must demonstrate the lack of personal jurisdiction by a preponderance of the evidence. Id.
Indiana’s Trial Rule 4.4(A) serves as a “long-arm statute.” It identifies eight acts that may support a trial court’s assertion of personal jurisdiction over a non-resident. It further provides that “a court of this state may exercise jurisdiction on any basis not inconsistent with the Constitutions of this state or the United States.” Id.
Under the Fourteenth Amendment, a state court may exercise personal jurisdiction over a non-resident defendant if there exist “certain minimum contacts with [the State] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Int’l Shoe Co. v. Wash., 326 U.S. 310, 316 (1945) (quotation omitted in original).
Applying General Personal Jurisdiction
Personal jurisdiction can be either general or specific. General jurisdiction exists where a defendant is “essentially at home” in the State (Ford Motor Co. v. Mont. Eighth Jud. Dist. Ct., 592 U.S. 351, 358 (2021)). On the other hand, specific jurisdiction requires a defendant’s contacts with the forum state to arise to “purposeful availment,” showing that the “defendant deliberately reached out beyond its home [(]by, for example, exploit[ing] a market in the forum State or entering a contractual relationship centered there”), although the plaintiff’s claims must still arise out of or relate to that defendant’s specific contacts with that state. Id. at 359.
Because none of the Appellants in this case were incorporated in or had their principal places of business in Indiana, they weren’t subject to general jurisdiction.
Applying Specific Personal Jurisdiction
Specific jurisdiction analysis in this case, however, was less straightforward.
PTI argued that its involvement in the production of the product was limited to blending and bottling it at its Missouri facility, which it claimed was done entirely according to Insight’s specifications. PTI also argued that the destinations were entirely chosen by Insight. Furthermore, relying on Sebring v. Air Equipment & Engineering, Inc., 988 N.E.3d 272 (Ind. Ct. App. 2013), PTI argued that the fact its product ultimately arrived in Indiana through the stream of commerce was not sufficient to establish personal jurisdiction without showing that it did “something more” in Indiana.
In Sebring, the non-resident defendant manufactured a component part ultimately installed in a finished device at an Indiana destination. In support of its argument for lack of personal jurisdiction, the defendant in Sebring submitted an affidavit from its president alleging, in part:
- It didn’t have employees or facilities in Indiana.
- It had a national advertising program that may have been directed to Indiana only between March 1991 and October 1993.
- It hadn’t had a sales representative or distribution network in Indiana since January 2003.
- The customer directed and arranged for shipping of the component to the destination, including selection of the carrier and payment of the charges.
- The manufacturer didn’t install or inspect the finished apparatus and had no contact with the customer or the Plaintiff.
Accepting the manufacturer’s argument, the Court of Appeals in Sebring held that the manufacturer’s contacts with Indiana were too attenuated to support specific jurisdiction: the manufacturing of the component took place entirely in Texas; the decision to ship to Indiana was made solely by the customer, without the manufacturer’s input; and, the manufacturer’s involvement ceased when it tendered the component to the carrier in Texas. (In determining that the manufacturer didn’t do “something more,” the Sebring Court relied heavily on Justice Breyer’s concurring opinion in J. McIntyre Machinery, Ltd. v. Nicastro, 564 U.S. 873 (2011).)
Applying Sebring, the Indiana Court of Appeals in this case found the analysis substantially similar: PTI manufactured the product in Missouri for Insight; Insight selected the carrier and paid the freight charges; and, Insight ultimately determined where to ship the product. Therefore, the only “something more” PTI did was to introduce the product into the stream of commerce. The Court further rejected plaintiff’s argument that PTI was responsible for transporting the product, coordinated shipments directly to Indiana, and scheduled the pick-ups with the carriers. Under the contract, Insight was responsible for shipping and transportation, although PTI scheduled pick-up times with third-party carriers since it controlled its own shipping dock. This limited role, the Court concluded, was not “something more.”
Likewise, with regard to after-the-sale duties under the contract, the Court held that PTI’s investigations in Missouri—stemming from customer complaints to Insight—did not arise to “something more” in Indiana.
Lastly, the Court held that Aquatherm was distinguishable in that Aquatherm had an interactive website, identified a company in Indiana that was using the product, and had a warranty that required its continued involvement with the consumer. Finding these missing, the Court concluded that Sebring controlled, PTI had not purposefully availed itself of the privilege of conducting business in Indiana, and the denial of its motion to dismiss was in error.
Turning to BCC, the Court applied the same framework and reached the same conclusion: BCC’s sole shipment was from 2005, and delivery was complete once Insight’s carrier picked it up at BCC’s shipping dock. Again, there was no “something more.”
Lastly, with respect to Broadview and the Trusts, the Court noted that since there was no personal jurisdiction over PTI, there couldn’t be personal jurisdiction over its holding company (Broadview) or the Trusts (as members of Broadview).
[1] PTI Union, LLC, Black Creek Corporation, Broadview Investments, LLC, Edward T. Noland, Jr., Irrevocable Gifting Trust, Tarrasch Family Trust, Revocable Living Trust of Edward T. Noland, Jr., and Laura Noland Tarrasch Revocable Trust v. Michele McBride, on her own behalf and as Personal Representative of the Estate of Ronald McBride, Ind. Ct. App. 24A-MI-931 (May 2, 2025).
- Associate
Andrew B. Symns helps clients navigate through all stages of civil litigation, insurance coverage, and bad faith litigation matters. His no-nonsense approach ensures his clients and colleagues know the strengths, weaknesses ...