Key Points

  • The Fourth Appellate District, Division Two, granted Fanuc Corp.'s writ petition and directed the San Bernardino County Superior Court to grant the Japanese company's motion to quash service for lack of personal jurisdiction.
  • The court held that Fanuc Japan is not subject to general jurisdiction in California through its subsidiary Fanuc America, a Delaware corporation headquartered in Michigan, under either an agency or an alter ego theory, because the subsidiary is not essentially at home in California.
  • The court said in a footnote that California cases applying the representative-services agency doctrine rejected in Daimler AG v. Bauman presumably are no longer good law.
  • Assuming agency and purposeful availment, the court held that the plaintiff failed to show relatedness under Ford because he identified no California sale, installation or marketing of the M-410iB/700 robot model, and the subsidiary's California service centers and a post-accident repair were insufficient.
  • The court expressly left open that Fanuc Japan could be subject to specific jurisdiction in California on a different claim or record.

A California appeals court ruled Friday that Fanuc Corp., the Japanese robot maker, cannot be sued in the state's courts by a bottling-plant maintenance technician who says one of its robots played a part in an accident that severely injured him.

A three-justice panel of the Fourth Appellate District, Division Two, granted Fanuc's petition for a writ of mandate. The panel reversed a San Bernardino County Superior Court ruling that had denied Fanuc's motion to quash service of summons. Raphael wrote the published opinion, joined by Ramirez and Miller.

The decision applies two U.S. Supreme Court rulings, Daimler AG v. Bauman and Ford Motor Co. v. Montana Eighth Judicial District Court, to a foreign manufacturer that sells in the United States through an American subsidiary. The panel held that the subsidiary's California business could not open the Japanese parent to suit in California on any claim, because the subsidiary is incorporated in Delaware and headquartered in Michigan. The panel also held that the worker had not tied his claim to any California sale or marketing of the robot model involved.

According to the opinion, Abraham Bernal was working a shift at Niagara Bottling Company in June 2020 when a depalletizer, an industrial machine, and a robot malfunctioned. Bernal was securing a ladder below the depalletizer's gripper head, 15 to 20 feet above the floor, when the machine released the gripper head. Krones, Inc. made the depalletizer. Fanuc, which the opinion calls Fanuc Japan, made the robot, an M-410iB/700 that Krones bought from either "FANUC Europe" or "FANUC Germany."

Bernal sued Krones, Fanuc Japan and its wholly owned subsidiary, Fanuc America Corporation, which did not contest jurisdiction. Fanuc Japan specially appeared and moved to quash. A company executive stated that Fanuc Japan has no California office, bank accounts or property.

Bernal argued that Fanuc America acted as its parent's agent and alter ego. The alter ego doctrine lets courts disregard a corporation's separate existence when the corporate form is used for fraud or another wrongful purpose. Bernal cited the companies' interlocking boards and the three California locations among Fanuc America's 22 service sites.

Judge David E. Driscoll denied the motion, citing considerable evidence of general jurisdiction, which allows a court to hear any claim against a defendant, on an agency theory. The ruling also cited the court's earlier conclusion, on a Fanuc America summary-judgment motion, that evidence showed the two companies "essentially operated a single-enterprise."

Raphael wrote that Daimler "forecloses the trial court's use of an agency theory here." In Daimler, the Supreme Court rejected a Ninth Circuit test that asked whether a parent company would perform its subsidiary's services itself if the subsidiary did not exist. The high court said that test would "always yield a pro-jurisdiction answer."

In a footnote, the panel said that California decisions applying the same doctrine, known as "representative services," "presumably are no longer good law," although "no case has squarely held as much."

Under Supreme Court precedent, a corporation is ordinarily "at home," and subject to general jurisdiction, where it is incorporated and where it has its principal place of business. Raphael wrote that Fanuc America "can hardly be said to be essentially at home in California, even if it conducts a significant amount of business here." For that reason, the court held, Fanuc Japan would escape general jurisdiction even if Fanuc America were its alter ego.

The opinion also observed that Bernal spent several pages of his return arguing agency-based jurisdiction, yet "at no point in that discussion does he discuss—or even cite—Daimler."

The court then turned to specific jurisdiction, which reaches only claims that arise out of or relate to a defendant's contacts with the state. The panel assumed without deciding that Fanuc America acted as Fanuc Japan's agent, so that the parent had deliberately reached into California through the subsidiary's U.S. robot sales and three California service locations. The case turned on relatedness, the requirement that the claim connect to those contacts.

In Ford, the Supreme Court allowed suits in Montana and Minnesota because Ford had advertised, sold and serviced the two car models at issue in those states for many years. Raphael wrote that Bernal "does not point to any sale of the Fanuc robot at issue" to anyone in California by either Fanuc company. He also showed no California installation of the specific robot or marketing of that model to California customers, the court said.

Bernal had stressed that Fanuc America sold other robots to Niagara Bottling. That evidence "shows little (or even nothing) about how his claim—that the M-410iB/700 was defective—is related to Fanuc America's California contacts," Raphael wrote. The panel added that "it is possible that the robot model at issue here was never sold in California."

The court also gave little weight to the California service centers and to Fanuc America's servicing of the robot after the accident. Bernal's evidence did not show that a California center performed that repair. Even if one did, the panel wrote, "this singular data point" would not establish relatedness. The panel cited a 2022 Ninth Circuit decision finding that an aircraft-engine maker's four Arizona repair shops, "without more," were insufficient.

The opinion left room for future claims. "We do not mean to suggest that Fanuc Japan could never be subject to specific jurisdiction in California in a products liability case," Raphael wrote. "Perhaps it could be on a different claim, or on a different record."

Fanuc Japan was represented by Curt Cutting of Horvitz & Levy. Bernal was represented by Daniel K. Balaban of Balaban & Spielberger.

The panel reversed the order denying the motion and remanded with directions to enter a new order granting it, and awarded Fanuc Japan its costs. The ruling concerns only Fanuc Japan and does not decide Bernal's claims against Krones or Fanuc America.