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Adkins v. CSX Transportation, Inc.

United States District Court, S.D. West Virginia, Huntington Division

July 30, 2019

JUSTIN ADKINS, et al., Plaintiffs,
v.
CSX TRANSPORTATION, INC., et al., Defendants.

          MEMORANDUM OPINION AND ORDER

          ROBERT C. CHAMBERS UNITED STATES DISTRICT JUDGE.

         Pending before the Court is Defendant CSX Corporation's (“CSX”) Motion to Dismiss, pursuant to Fed.R.Civ.P. 12(b)(2) and 12(b) (6). ECF No. 19. For reasons set forth herein, the Motion is DENIED.

         I. BACKROUND

         Plaintiffs first filed their Complaint on February 15, 2018, claiming remedies under § 510 of the Employee Retirement Income Security Act (“ERISA”), § 504 of the Rehabilitation Act of 1973 (“Rehab Act”), the West Virginia Human Relations Act (“WVHRA”), the Family and Medical Leave Act (“FMLA”), and state law causes of action including defamation, invasion of privacy, tortious interference, intentional infliction of emotional distress and wrongful discharge. Compl., ECF No. 1. CSX Transportation, Inc. (“CSXT”) and its parent corporation, CSX, were named as defendants in the Complaint. Id. Plaintiffs subsequently filed an Amended Complaint on May 16, 2018 and a Second Amended Complaint on August 16, 2018. Am. Compl., ECF No. 8; Second Am. Compl., ECF No. 18. CSX filed the Motion to Dismiss on August 30, 2018, claiming the Court lacks personal jurisdiction. Mot. to Dismiss, ECF No. 19.

         II. LEGAL STANDARD

         When a defendant moves to dismiss for lack of personal jurisdiction and the court decides the “motion without an evidentiary hearing, the plaintiff need prove only a prima facie case of personal jurisdiction.” Mylan Labs., Inc. v. Akzo, N.V., 2 F.3d 56, 60 (4th Cir. 1993). “[T]he district court must draw all reasonable inferences arising from the proof, and resolve all factual disputes, in the plaintiff's favor.” Id. To prove specific jurisdiction over an out-of-state defendant, a plaintiff must show that jurisdiction is authorized by the long-arm statute of the state in which the court sits and that exercise of such jurisdiction is consistent with the Due Process Clause of the Fourteenth Amendment. Consulting Eng'rs Corp. v. Geometric Ltd., 561 F.3d 273, 277 (4th Cir. 2009). Where, as here, the state's long-arm statute is coextensive with the full reach of the Due Process Clause, those questions merge into one inquiry. In re Celotex Corp., 124 F.3d 619, 627-28 (4th Cir. 1997).

         Courts in this Circuit apply a three-part test. The Court must examine “(1) the extent to which the defendant purposefully availed itself of the privilege of conducting activities in the State; (2) whether the plaintiffs' claims arise out of those activities directed at the State; and (3) whether the exercise of personal jurisdiction would be constitutionally reasonable.” ALS Scan, Inc. v. Dig. Serv. Consultants, Inc., 293 F.3d 707, 712 (4th Cir. 2002) (internal quotation marks omitted). The first prong reflects the requirement there are “sufficient ‘minimum contacts' with the forum state such that ‘the maintenance of the suit does not offend traditional notions of fair play and substantial justice.'” Consulting Eng'rs, 561 F.3d at 277 (quoting Int'l Shoe Co. v. Wash., 326 U.S. 310, 316 (1945)). While the law presumes separately incorporated companies are legally distinct, “if the parent and its subsidiary act as one entity, their formal separate corporate structures will not prevent the assertion of jurisdiction over the non-resident corporation.” Town of Fayetteville v. Law, 495 S.E.2d 843, 848 ( W.Va. 1997).

         The Supreme Court of Appeals of West Virginia has outlined eleven factors to be considered by a court “in determining whether to assert personal jurisdiction over the parent company of a subsidiary doing business in West Virginia.” Bowers v. Wurzburg, 501 S.E.2d 479, 490 ( W.Va. 1998). In determining whether to impute a subsidiary's contacts with West Virginia to its parent, courts should look to the following factors:

1. Whether the parent corporation owns all or most of the capital stock of the subsidiary;
2. Whether the parent and subsidiary corporations have common directors and officers;
3. Whether the parent corporation finances the subsidiary;
4. Whether the parent corporation subscribes to all the capital stock of the subsidiary or otherwise causes its incorporation;
5. Whether the subsidiary has grossly inadequate capital;
6. Whether the parent corporation pays the salaries and other expenses or losses ...

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