SW Legal studies in Business

No Jurisdiction in U.S. over Foreign Firm for Injury Suffered by U.S. Citizen While Overseas
Description

Appeals court held that U.S. courts have no jurisdiction over a foreign corporation owned by Americans that advertises in the U.S., for injuries suffered by a client while on vacation at a resort owned by the corporation, when the client went on a fishing trip run by another foreign corporation.

Topic Court Procedure
Key Words

Jurisdiction; Tort; Foreign Corporation

C A S E   S U M M A R Y
Facts

Pueblo De Bahia Lora, S.A., is a Costa Rican corporation owned by two U.S. citizens. It operates a fishing resort in Costa Rica called “Parrot Bay Village.” Oldfield, a Florida resident, came across the Parrot Bay website, which is in English, uses a U.S. mailing address, and provides a toll-free number for potential guests to call. Oldfield made a reservation online and went to the resort. When at the resort, he went on a fishing trip on a charter boat. That arrangement was made by Parrot Bay, but the boat was owned and operated by a Costa Rican. Oldfield suffered an injury that he claims was due to the negligence of the boat operator. He sued Parrot Bay in federal court, claiming diversity of citizenship. Parrot Bay did not respond; Oldfield was awarded a default judgment for $750,000 as requested. Parrot Bay appealed.

Decision

Vacated and remanded. The district court lacked jurisdiction, so the judgment is void. Parrot Bay, a foreign corporation, is not responsible for the actions of the fishing boat operator, another foreign entity. The relationship between Parrot Bay and the fishing boat operator did not arise out of, or relate to, Parrot Bay’s contacts with the United States. It was not foreseeable by Parrot Bay that Oldfield might suffer an injury on a boat that it did not own or operate while he stayed at Parrot Bay as a result of his having visited the resort’s website and made a reservation for a room there. Therefore Parrot Bay cannot be subject to U.S. court jurisdiction in this matter. Oldfield can pursue his claim against the fishing boat operator in court in Costa Rica.

Citation

Oldfield v. Pueblo de Bahia Lora, S.A., 558 F.3d 1210 (11th Cir., 2009)

Back to Court Procedure Listings

©1997-2009  South-Western Legal Studies in Business, A Division of Cengage Learning. All Rights Reserved.