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Chrysler Customers Argue NY Jurisdiction is Appropriate

A putative class of Dodge and Chrysler owners have filed a complaint in New York against the car conglomerate, Fiat Chrysler or FCA US LLC ("FCA"), for allegedly hiding a tire defect in Chrysler Town and Country minivans, Dodge Grand Caravan minivans, and Jeep Liberty and Dodge Journey SUVs. However, FCA argued, in its motion to dismiss, that almost none of the named plaintiffs had bought their cars in New York. The one plaintiff who had purchased in New York was also involved in a similar suit that already surpassed dismissal, which caused him, FCA argued, to be a "fraudulent joinder." Therefore, FCA urged the court to dismiss the tire defect claims because New York was the inappropriate court for the plaintiffs to file their lawsuit.

The representatives of the class retorted that jurisdiction was appropriate because New York possesses general and specific jurisdiction over FCA based on the state's registration statute. Accordingly, plaintiffs allege that because FCA registered its business in New York, it has consented to jurisdiction there.

In response to FCA's "fraudulent joinder" claim, plaintiffs argued that the New York purchaser plaintiff, Thomas Hromowyk ("Hromowyk"), was not a fraudulent joinder because that legal theory is only relevant in the context of trying to defeat federal jurisdiction. On the contrary, Hromowyk never tried to assert claims in state court.

Even if FCA's New York registration does not provide general jurisdiction in New York, plaintiffs argued that the court should not decide on specific jurisdiction until the Supreme Court makes its decision in Bristol-Myers Squibb Co. v. Superior Court of California 228 Cal. App. 4th 605 (2014). That case involves the California Supreme Court's finding that the state had jurisdiction, despite being an out-of-state drugmaker. The decision would help determine the scope of specific jurisdiction, which would guide the New York court's decision.

The legal team at SFMS has significant experience litigating products liability matters. If you have any questions regarding this subject or this posting, please contact Nick Lussier (nlussier@sfmslaw.com) or Chiharu Sekino (csekino@sfmslaw.com). We can also be reached toll-free at (866) 540-5505.

Shepherd, Finkelman, Miller & Shah, LLP is a law firm with offices in California, Connecticut, Florida, New Jersey, New York, and Pennsylvania. SFMS is an active member of Integrated Advisory Group (www.iaginternational.org), which provides us with the ability to provide our clients with access to excellent legal and accounting resources throughout the globe. For more information about our firm, please visit us at www.sfmslaw.com.

SOURCES

Amaral, Brian. "Chrysler Buyers Say NY Court Can Hear Tire Defect Case." Law360. Last modified on March 28, 2017.

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