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MCDANIEL v. ARMSTRONG WORLD INDUS.

March 14, 1985

FLETCHER McDANIEL, et al., Plaintiffs,
v.
ARMSTRONG WORLD INDUSTRIES, et al., Defendants



The opinion of the court was delivered by: FLANNERY

 This matter is before the court on the motions to dismiss filed by defendants Turner & Newall PLC ("T&N") and Nicolet, Inc. ("Nicolet"), and the motion of defendants Atlas-Turner, Inc. ("Atlas"), and Bell Asbestos Mines, Ltd. ("Bell") to dismiss or, in the alternative, for summary judgment. These motions allege that this court lacks personal jurisdiction over these defendants.

 BACKGROUND

 Plaintiff Fletcher McDaniel was employed from 1950 to 1982 as a plasterer's helper. He alleges that he worked at various job sites in and around the District of Columbia where he was exposed to asbestos and asbestos-containing materials. As a direct result, plaintiff claims, he contracted a pulmonary disease. The defendants are manufacturers, suppliers and sellers of asbestos and asbestos-containing products with which plaintiff alleges he came into contact. Plaintiff further alleges that defendants were negligent and failed to warn him of known dangers. He also sues on the theories of strict liability and breach of warranties. Plaintiff asserts that he was diagnosed as having this pulmonary disease in 1983. The intricate corporate structure involved in this case and its changing nature over time are critical in determining whether this court can exercise personal jurisdiction over these defendants. Significantly, none of the defendants has taken issue with plaintiffs' description of the corporate structure and distribution scheme involved in this case.

 Turner & Newall was formed in 1920 through a merger of several United Kingdom manufacturers of asbestos-containing products, one of which was J.W. Roberts, Ltd. J. W. Roberts continued to function as a branch of T&N. In 1934, T&N acquired Atlas Asbestos Co., a Canadian corporation. In 1936, T&N completed the acquisition of Keasbey and Mattison Company ("K&M"), located in Ambler, Pennsylvania. Keasbey and Mattison owned Bell Mine in Thetford, Quebec. In 1937, T&N formed a wholly owned subsidiary, Bell Asbestos Mines, Ltd., for the purpose of acquiring Bell Mine.

 By 1950, Keasbey and Mattison was manufacturing a wide range of asbestos-containing products. By that same year, T&N's distribution chain was so firmly entrenched that T&N informed its shareholders that Keasbey and Mattison distributors:

 
now embrace all the major trading areas of the nation, and serve to place the various Keasbey and Mattison products virtually at the doorsteps of retailers and ultimate users throughout the United States.

 Turner & Newall brochure at 39 (quoted in Plaintiffs' Brief in Opposition to Defendant Turner & Newall PLC's Motion to Dismiss at 5).

 In the 1930's, J. W. Roberts, a company for which T&N does not deny responsibility, developed a product known as Sprayed Limpet Asbestos. The manufacturing process took place in England and the product was distributed through a series of exclusive license agreements. Initially, J. W. Roberts granted Keasbey and Mattison the right to distribute Limpet in the United States. In the late 1950's, Keasbey and Mattison entered into a sublicensing agreement with National Asbestos Co. ("National"), one of the companies for which Mr. McDaniel worked, for the Sprayed Limpet Asbestos process. National's territory under this agreement included the District of Columbia, and under this agreement, National regularly applied Sprayed Limpet Asbestos in buildings located in the District of Columbia.

 In 1962, after selling Keasbey and Mattison, T&N, through J. W. Roberts, granted Armstrong Contracting and Supply Company an exclusive license for the Sprayed Limpet Asbestos process in the United States. Armstrong entered into a sublicense agreement with Krafft-Murphy to sell Limpet in an area that expressly included the District of Columbia. This sublicense agreement was subject to T&N's approval. Krafft-Murphy employed the plaintiff, Mr. McDaniel. T&N shipped Limpet for use in the District of Columbia to ports in Maryland and New Jersey. The Limpet was trucked from the ports to a Krafft warehouse or delivered directly to District of Columbia construction sites.

 In 1967, the license held by Armstrong was transferred to Atlas Asbestos Co., an internal division of T&N's wholly owned subsidiary, Bell. In addition to being the licensee for the distribution of Limpet in the United States, Atlas manufactured Limpet. Most of the asbestos fiber used by Atlas in the manufacturing process was supplied by a subsidiary of T&N. The sublicense with Krafft-Murphy was also transferred from Armstrong to Atlas. Thereafter, Krafft-Murphy applied Limpet in buildings located in the District of Columbia throughout the period it served as sublicensee. Atlas frequently shipped Sprayed Limpet Asbestos ordered by Krafft-Murphy directly to District of Columbia jobsites by truck from Canada. On other occasions shipments were made to the Keasbey and Mattison warehouse in Virginia. In 1977 Atlas Asbestos Company became a separate corporate entity and changed its name to Atlas-Turner, Inc.

 Defendants do not dispute the facts as set out above in any of their essentials. Defendant Turner & Newall contends that its lack of present contacts with the forum puts it out of the reach of the D.C. long-arm statute. Alternatively it argues that to find that this court can exercise personal jurisdiction over it would be a violation of due process. Defendants Atlas and Bell deny that this jurisdiction's long-arm statute covers their activities, and argue, that if it does, they have no minimum contacts with the District of Columbia. Defendant Nicolet argues that jurisdiction cannot be found over it on the basis of the activities of Keasbey and Mattison.

 DISCUSSION

 In order for this court to find that it can exercise jurisdiction over these defendants it must make a two-pronged inquiry. First, the court must determine whether the D.C. long-arm statute permits the exercise of jurisdiction over these defendants. If so, then the court must inquire whether the exercise of jurisdiction over these defendants comports with constitutional due process requirements. Gatewood v. Fiat, S.p.A., 199 U.S. App. D.C. 238, 617 F.2d 820, 823 (D.C. Cir. 1980). *fn1"

 The D.C. long-arm statute provides in pertinent part:

 
(a) A District of Columbia court may exercise personal jurisdiction over a person, who acts directly or by an agent, as to a claim for ...

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