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REPORTED IN THE COURT OF SPECIAL APPEALS OF MARYLAND No. 02762 September Term, 2006

ANDREA TAYLOR, ET AL. v. CSR LIMITED, ET AL.

Hollander, Alpert , Paul E ., (Retired, Specially Assigned) *Adk ins, Sally D ., JJ.

Opinion by Adkins, J.

Filed: September 9, 2008 ____________________________________ *Adkins, Sally D., J., now serving on the Court of Ap peals, participated in the hearing and conference of this case while an active member of this Court; she participated in the adoption of this opinion as a specially assigned m ember of this Court.

REPORTED IN THE COURT OF SPECIAL APPEALS OF MARYLAND No. 02762 September Term, 2006

ANDREA TAYLOR, ET AL. v. CSR LIMITED, ET AL.

Hollander, Alpert , Paul E ., (Retired, Specially Assigned) *Adk ins, Sally D ., JJ.

Opinion by Adkins, J.

Filed: ____________________________________ *Adkins, Sally D., J., now serving on the Court of Ap peals, participated in the hearing and conference of this case while an active member of this Court; she participated in the adoption of this opinion as a specially assigned m ember of this Court.

The estates of two stevedores alleged to h ave contra cted cance r from ex posure to asbestos while unloading bags of asbestos at the Port of Baltimore, appeal the dismissal of their claim for a lack of personal jurisdiction against an Australian company. CSR Limited, d/b/a Colonial Sugar Refining Co., Ltd. ("CSR"), appellee, is an Australian corporation alleged to have shipped bags of asbestos fiber to the Port of Baltimore at the time Alfred B. Smith and Joseph Anzulis worked there as stevedores. Andrea Taylor, personal

representative for the Sm ith estate, and M ary Fuchslug er, personal re presentative for the Anzulis estate, present the following question for our review: Did the trial court err as a matter of law in g ranting CSR's motion to dismiss for lack of personal jurisdiction? Viewing the evidence in the light most favorable to appellants, we conclude that appellants made a prima f acie case that CSR has sufficient contacts in M aryland to support personal jurisdiction for these causes of action. FACTS AND LEGAL PROCEEDINGS The estates (herein after togethe r referred to a s "Taylor"), sue d several co rporate entities including CSR, alleging that Smith and Anzulis, while working as stevedores at the Port of Baltimore, w ere exposed injuriously to asb estos fibers e xported b y CSR w hile offloading bags containing asbestos. Taylor maintains that as a result of this o ff-loading , Smith and Anzulis contracted mesothelioma, a cancer caused by exposure to airborne asbestos fiber. Taylor alleges m ultip le causes of ac tion, includin g stri ct liability, brea ch of wa rran ty, negligence, and fraud. Taylor alleg es that CS R op erate d an asbe stos mine through a w holly owned

subs idiar y, Australia Blue As bestos Pty. Limited ("ABA "), and CSR, as the mine's exclusive distributor, exported a sbestos fibe r for sale to cu stomers in th e United States, particu larly Johns-M anville Internationa l.1 CSR is alleged to have made such exports from 1943 to 1966, with so me of the ship ments p assing th rough the Por t of Ba ltimore. Smith and Anzulis worked at the Port unloading cargo from approximately 1942 through 1983 and 1937 th roug h 1973, respe ctive ly. Lloyd M . Gardn er, Sr., a co-worker of Smith and An zulis, stated in an affidavit tha t he unloaded, among other various cargos, thousands of burlap bags containing loose asbestos, shipped to Baltimore from foreign ports. According to Gardner, he unloaded shipments of asbestos from Australia up to six times a year in the 1950s an d 60s, and some of these bags had a diam ond-shap ed logo on them with the letters "CSR." Gardner also testified in a deposition that the offloading of the bags produced dust. Gard ner remem bers Smith and An zulis being p resent wh en the dus tproducing work took place . William Gardner, Lloyd Gardner's brother and a stevedore who worked at the Port from 1961 until 1970, also indicated in deposition testimony that he recalled unloading CSR-labeled burlap bag s containing asbestos, tha t dust wou ld be "all over the place[,]" and that Smith and Anzulis were present during these unloading jobs. From 1943 to 1966, CSR owned a subsidiary, ABA, that mined and packaged crocidolite asbestos in Western Australia. During that time, CS R functioned as A BA's agent

CSR is a corporation organized and existing solely under the laws of Australia. Its principal place of business is in Sydney, Australia. 2

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for asbestos fiber sales to custom ers in the United States. In add ition to its asbestos export activities, CSR was involved in the sugar refining and export business. CSR had an agreement with the state of Queensland, Australia, to market all Australian exports of raw sugar, including the arrangements for sale, transport, insurance and financing.2 Maryland Port Authority statistics indicate that during the years of 1964 through 1966, app roximately 82,847 tons of raw sugar we re imported to the Port of Baltimore from Australia having a total value of $10,921,373, a value in 2005 dollars of over $66.5 million. On October 10, 2005, CSR filed a motion to dismiss Taylor's complaint against CSR on the ground that M aryland does n ot have pe rsonal jurisdic tion. In an af fidavit, Edw in Anthony Smith, manager of CSR's Group Financial Reporting,3 stated that CSR has never In a 1968 b ooklet pub lished by CS R entitled "Notes on the Australian Sugar Industry," CSR indicated tha t it "markets all Australian exports of raw sugar including the arrangem ents for sale, transport, insurance and financing[,]" and that the Unite d States, in receiving 158,000 tons, was th e fourth larg est recipient of Australian raw sugar in 1966. Taylor asserts in her brief that CSR's contract to market Australia's sugar exports was "in place in 1956, the date of C SR's alleged first sale and shipment of asbestos fiber to Ba ltimore as reflected in the available CSR records." Although the 1968 CSR publication, to which Taylor cites, indicates that CSR was "[u]nder contract with the Queensland Gove rnmen t . . . [to] market[] all Australian exports of raw sugar[,]" it does not specify when CSR first entered into the sugar marketing contract. CSR, in its brief, does not, however, challenge Taylor's assertion that the sugar export contract was in place in 1956, stating that it "accepts, in part, A ppellan ts' Statem ent of F acts, exc ept wh ere Ap pellants are argu menta tive." Taylor takes issue with Smith's af fidavit, contending that Sm ith's statements were not based upon his o wn personal kn owledge of e vents. Taylor concludes from Smith's deposition testimony taken on November 30, 2005 , that Smith's s tatements ar e attributable to a convers ation Smith had with Keith Osborne Brown, an executive with CSR, in 1995 and conversations Smith had with CS R's legal c ounsel. Smith indicated in his deposition testimony that he had not seen a c ontract betw een CS R and an y of its customers, nor did he (contin ued...) 3
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been incorporated or licensed to do business in Maryland, nor has it ever appointed an agent for purposes of accepting service of process in Maryland. According to Smith, CSR has never conducted or solicited any business in Maryland; has never had any employees or agents based or residing in the state; has never maintained an office, telephone listing, mailing address or bank account in Maryland; and has never owned, leased, or possessed any interest in real or pers onal prop erty in the state. Smith asserts that CSR has never conducted an asbestos-rela ted busines s in Maryland, has never been a party to any contract in the state, and has not been required to perform any contract in the state. Smith also states that CSR has never manufa ctured, prod uced, me rchandised , marketed , supplied, distrib uted, sold or installed asbestos products in Maryland. According to Smith's understanding, the purchaser of asbestos fiber was "basically responsible for it" when it left the port in Australia and where it went " was d ictated b y the purc haser." In opposition to CSR's motion to dismiss, Taylor provided as exhibits four invoices, indicating CSR shipments of asbestos fiber from Australia to the Port of Baltimore during the period of time in which Smith and Anzulis worked as stevedores. 4 Taylor also provided an affidavit of Captain Robert Stewart, a maritime expert, indicating that three of the four invoiced shipments were made pursuant to "C.&.F./C.I.F." shipping contracts, short for (...continued) have expertise in maritime shipments or maritime law. The shipping in voices inclu ded one a ddressed to Johns-M anville Co rporation in 1956, another addressed to Huxley Develop ment Co rporation in 1 963, and tw o addresse d to Orangeburg Manufacturing Company in 1964 and 1965. 4
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"Cost and Freight[,]" in wh ich CSR, as the "se ller/shipper/consignor" of the asb estos fiber, was obligated to package and mark the asbestos fiber, identifying the contents and port destination; prepare an invoice; contract for marine insurance; obtain necessary shipping documents, such as export licenses; pay all freight charges to the carrier, including cos ts associated with hiring a stevedore c ompany to u nload the c argo; obtain a clean neg otiable bill of lading, covering the transportation to Baltimore; and remain responsible for the cargo until it arrived and was unloaded in Baltimore, at which time the buyer accepted the cargo. Stewart also indicated that under C .&.F. or C IF agreem ents, CSR would h ave acces s to Maryland courts if any of the buyers wrongly failed to accept the asbestos shipments upon delivery in Baltimo re. Accord ing to Stew art, the terms of the four invoices indicate that the shipmen ts cumulatively weighed over 1.2 million pounds, consisting of 13,332 individual bags of asbestos fibe r.5 Taylor also provided the court wit h an affidavit of Dr. Barry Castleman, an environmental consultant with expertise regarding the history of the asbestos industry and development of knowledge of asbestos disease and worker health. Castleman provided his opinion that from 1 943 to 1966, CSR would have known that burlap bags containing asbestos fiber from ABA's mine in Western Australia were handled and unloaded by stevedores at various ports and that such bags would often break, tear, or be punctured, thereby exposing

Dr. Jerome P aige, an eco nomist, indic ates in an affidavit submitted by Taylor that the cumulative value of the four shipments was over $100,000 in the 1950s and 60s, which, valued today, would be over $1,000,000. 5

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stevedores and others to airborne asbestos. C astlemen a lso stated that C SR regu larly advertised the sale of ABA asbestos, from approximately 1942 through 1966, in Asbestos, a trade magazine of the United States asbestos industry. From 1954 to 1966, CSR placed advertisem ents in Asbestos issues every other m onth. Castle men opin ed that CS R wou ld have known that its marketing in Asbestos would have reached Maryland consumers, such as Porter Hayden a nd Walla ce and G ale, Baltimo re insulation c ontractors. A ccording to Castlemen, CSR was aware of the potential h ealth hazard s of its crocidolite as bestos dus t in the 1940s and became aware in the early 1960s that one of its mill workers had developed mesothelioma. On Novemb er 2, 2006, the Circuit Co urt for Baltimore City held a hea ring on CSR 's motion to dismiss and concluded in the following oral ruling that CSR lacked substantial meaningful contacts w ith Maryland and that subjecting C SR to the c ourt's jurisdictio n would be constitutionally unfair: So the minimum contacts that are necess ary to be shown, four invoices in this Court's opinion, at least, do not indicate any meaningful contact with the State of Maryland such that one could say that this indicates that they would anticipate that the defendant could antic ipate that he wou ld be hailed into court in this State. I know that the plaintiff says that it is not just four invoices, that there w ere substan tial shipmen ts in this matter, but there are four. That's really the numb er that I am lo oking at. And it is over a rather substantial period of time. I don't find that these are the substantial meaningful contacts. I have discussed or indicated, I guess while the 6

plaintiff was argu ing, that the ad vertising was done, I think, under the C amelback case is also n ot significan t. The fact that the customers, mostly Johns-Manville, directed the defendant to send the goods to the Port of B altimore to me is sign ificant. I think that when one is following the instructions of the customer to send the shipment where they are directed to send it that they have to follow the orders o f the customer. They are certainly not thinking that that is an action that they could reason ably expect that they are going to be hailed into court ba sed on tha t. And I have to say that, even if one could say that there were certain minimal contacts here, that when you get to step two, which is the constitutional reach, that I think that it falls short. It has been pointed out that we are dealing with a company that is located in another continent, many time zones away from where we are. And the fairness of bringing them in, I think, is beyond the constitutional reach. The court also concluded that CSR was not subject to Maryland's jurisdiction under the long-a rm statu te. The court issued an order granting CSR's mo tion to dismiss on January 8, 2007. DISCUSSION Standard Of Review Taylor contends that the court, in limiting its consideration to the four invoices, failed to evaluate the evidence in a light mo st favorab le to Taylor. According to T aylor, the court erred in rejecting the affidavits of Lloyd and William Gardner, observations from co7

workers, and also improperly ignored evidence of other contacts, such as CSR's sugar trade and asbestos advertising in Asbestos magazine. According to CSR, Taylor had to prove facts establishing jurisdiction to defeat the motion to dismiss, instead of merely adducing evidence to generate disputed facts, which would be sufficient to defeat a motion for summary judgment. CSR contends that Taylor failed to sustain her burden of proof, and the court correctly analyzed the controlling law and properly applied it to the facts of record. "The defense of lack of personal jurisdiction ordinarily is collateral to the merits and raises questions of law." Bond v. Messerman , 391 Md. 706, 718 (2006). "The burden of alleging and proving th e existence of a factu al basis for the exercise of personal jurisdiction, once the issue has been raised, is upon the plain tiffs." McKown v. Criser's Sales and Serv., 48 Md. A pp. 739 , 747 (1 981). Plaintiffs must establish a prima facie case for personal jurisdiction to defeat a m otion to dismiss . See Beyond Sys., Inc. v. Realtime Gaming Holding Co. , 388 Md. 1, 26, 29 (2005). "If facts are necessary in deciding the motion, the court may consider affidavits or other evidence adduced during an evidentiary hearing." Id. at 12. Without an evidentiary hearing, courts are to consider the evidence in the light most favorable to the non-moving party when ruling on a motion to dismiss for a lack of personal jurisdiction. See Zavian v. Foudy, 130 M d. App . 689, 702 (200 0). See also Mylan

Laboraties, Inc. v. Akzo, N.V., 2 F.3d 56 , 60 (4th Cir. 1 993)(a plaint iff " need prov e only a prima facie case of personal jurisdiction" when the court decides "a pretrial personal

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jurisdiction dismissal motion without an evidentiary hearing"); Combs v. Bakker, 886 F.2d 673, 676 (4th Cir. 1989)(citing 2A M oore's F ederal P ractice,

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