IN THE SUPERIOR COURT OF THE VIRGIN ISLANDS

DIVISION OF ST. THOMAS AND ST. JOHN



MAURICE CHABUZ, EDWARD SMITH, )

MARIE-FRANCE SMITH, MADELINE _)

MARSH, and WHITECAP INVESTMENT )

CORP. d/b/a PARADISE LUMBER



CASE NO. ST-13-CV-596



ACTION FOR BREACH OF

CONTRACT, BREACH OF



Plaintiffs, ) WARRANTY, NEGLIGENCE,

) STRICT LIABILITY,

Vs. ) INDEMNITY,

) CONTRIBUTION,

PUTNAM LUMBER & EXPORT ) FRADULENT INDUCEMENT/

COMPANY, PUTNAM FAMILY ) MISREPRESENTATION, and

PROPERTIES, INC., GREAT SOUTHERN) DECLARATORY JUDGMENT

WOOD PRESERVING, INCORPORATED,)

MIKE NOBLE, XYZ CORPORATION, )

JOHN DOE, & JANE DOE ) JURY TRIAL DEMANDED

)

Defendant. )

)

MEMORANDUM OPINION



THIS MATTER is before the Court on two separate motions to dismiss for



lack of jurisdiction, as follows: 1) Defendant Great Southern Wood Preserving’s



(“Great Southern”) Motion to Dismiss the Complaint, and 2) Defendant Great



Southern Wood Preserving’s Motion to Dismiss Cross-claims filed by Putnam Family



Properties, Inc. and Putnam Lumber & Export Company. For the reasons set forth



herein both motions to dismiss will be denied.

Chabuz, et al v. Putnam Lumber & Export Company et al.

Case No. ST-13-CV-596



Memorandum Opinion



Page 2



BACKGROUND



Plaintiffs Maurice Chabuz, Edward Smith, Marie-France Smith and Madeline

Marsh own homes in St. John, Virgin Islands. Plaintiff Whitecap Investment Corp.

d/b/a Paradise Lumber is a retail store on St. John, Virgin Islands. This case arises

out of Defendants’ alleged manufacture, production and distribution of defective wood

products. The individual Plaintiffs purchased wood products from Plaintiff Whitecap

Investment Corp, d/b/a Paradise Lumber (“Paradise Lumber’) at its retail location in

St. John.



Defendant Putnam Lumber and Export Company exports lumber outside the

continental United States. Putnam bought wood treatment services and sometimes

treated lumber from Great Southern. Great Southern is in the business of chemically

treating wood to protect against premature rot and decay. The individual Plaintiffs

allege the wood products they bought at Plaintiff Paradise Lumber, which Paradise

bought from Putnam, were not properly treated, causing it to rot and decay without

visible warning. Structures and properties built with the defective wood have become

damaged and are unsuitable to rent or otherwise use.



Plaintiffs also allege Defendants knowingly sold wood products with inferior

or substandard treatment to Virgin Islands customers to offset the high cost of

shipping the products to the Virgin Islands and increase profit. Pl.s’ Compl. § 29.



They further assert that Great Southern was not providing the wood treatment

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services it purported to be providing, and that Putnam knew it was not receiving the



treatment services it was ordering.



ANALYSIS



In its Motions, Great Southern argues that this Court does not have personal

Jurisdiction over it because the Virgin Islands long arm statute does not provide for

jurisdiction, and the Court’s exercise of personal jurisdiction does not comport with

the United States Constitution. Plaintiffs and Putnam oppose the Motion on grounds

that this Court may properly exercise personal jurisdiction over Great Southern.

Plaintiffs and Putnam also assert that collateral estoppel and res judicata bar Great

Southern’s Motion because Virgin Islands courts have uniformly denied Great

Southern’s motions asserting lack of personal jurisdiction in six (6) other cases.!



I. RES JUDICATA AND COLLATERAL ESTOPPEL



The term res judicata “actually comprise[s] two doctrines concerning the



preclusive effect of a prior adjudication.” 18 Charles Alan Wright et al., Federal



* Of the six other cases, five were filed in the District Court of the Virgin Islands and one was filed in the Superior

Court of the Virgin Islands. See Belizaire v. Whitecap investment Corp. d/b/a Paradise Lumber, No. 2013-66, 2014

WL 793135 (D.V.I. Feb. 26, 2014) (slip copy); Chapin v. Whitecap investment Corp. d/b/a Paradise Lumber, No.

2013-42 (District Court of the Virgin Islands); MRL Development I, LLC v. Whitecap Investment Corp. d/b/a Paradise

Lumber, No. 2013-48, 2014 WL 128198 (D.V.1 Jan. 14, 2014); Stewart v. Whitecap Investment Corp. d/b/a Paradise

Lumber, No. 2012-28, 2013 WL 1163510 (D.V.I. Mar. 21, 2013) (slip copy) (D.V.1 Mar. 21, 2013); Whitecap

Investment Corp. d/b/a Paradise Lumber v. Putnam Lumber and Export Co., No. 2010-139, 2013 WL 1155351 (D.V.I.

Mar. 21, 2013); Hills v. Whitecap investment Corp. d/b/a Paradise Lumber, No. ST-12-CV-395, 2013 WL 3185559

(Super. Ct. June 14, 2013).

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Practice and Procedure § 4402 (2d ed. West 2014). The first doctrine, “claim

preclusion,” sometimes confusingly referred to as res judicata, refers to a judgment’s

effect in foreclosing litigation of matters that were not litigated in the prior suit, but

should have been. Hodge v. McGowan, 29 V.I. 142, 147 (D.V.I. App. Div. Dec. 23,

1993). The second doctrine is “issue preclusion,” also known as “collateral estoppel.”

Federal Practice and Procedure § 4402. “Collateral estoppel ‘means simply that when

an issue of ultimate fact has once been determined by a valid and final judgment,

that issue cannot again be litigated between the same parties in any future lawsuit.”

Gilbert v. People of the Virgin Islands, 52 V.I. 350, (V.I. 2009) (quoting Ashe v.

Swenson, 397 U.S. 436, 443 (1970)); McGowan, 29 V.I. at 147 (“[i]ssue preclusion

refers to the effect of a judgment in foreclosing relitigation of a matter that has been

litigated and decided”).



Both claim preclusion and collateral estoppel require a final judgment in the

prior litigation. Plaintiffs and Putnam argue that the orders of the other six courts

denying Great Southern’s motions to dismiss for lack of personal jurisdiction are final

judgments. It is a well-established common law principle, however, that such orders



are not final judgments for res judicata purposes.” Therefore, the argument that the



? “To bind parties to a subsequent action to the outcome of a prior judgment pursuant to the principle of [claim

preclusion’, it is required that (1) the prior judgment was valid, final, and on the merits; (2) the parties in the

subsequent action are identical to or in privity with the parties in the prior action; and (3) the claims in the

subsequent action arise out of the same transaction or occurrence as the prior claims. Smith v. Turnbull, 54 V.1.

369, 375 (V.I. 2010). “[AJn issue is conclusively established in future litigation through the doctrine of collateral

estoppel only when it is determined by a final judgment. Anderson v. C.1.R., 698 F.3d 160, 166 (3d Cir. 2012).



3 Virgin Islands v. Ward, 55 V.I. 829, 839 (V.I. 2011) (describing order denying motion to dismiss as interlocutory in

criminal action); Rohn v. Gov't of Virgin Islands, 47 V.I, 682, (V.I. 2006) (same); 15A Charles Alan Wright et al.,

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defendants claims are barred by res judicata and collateral estoppel must fail.

Therefore, the Court will now evaluate the merits of Great Southern’s personal

jurisdiction defense.



II. | PERSONAL JURISDICTION



Great Southern argues that this Court lacks personal jurisdiction over it

because it does not have the constitutionally required minimum contacts with the

United States Virgin Islands. Specifically, it asserts that it treated wood products in

Georgia, delivered to its customers in Florida, and played no part in sending the wood

products to the Virgin Islands. Plaintiffs argue that this Court may exercise personal

jurisdiction over Great Southern with regard to the issues in this case, just as both

the Superior Court of the Virgin Islands and the Federal District Court of the Virgin

Islands have held in recent cases.



“Personal jurisdiction is the authority of a court to exercise jurisdiction over a

party before it.” St. Croix, Lid. v. Shell Oil Co., No. 2011-57, 2014 WL 235994, at *2

(V.I. Jan. 22, 2014). The Plaintiffs shoulder the burden of demonstrating a prima

facie case for exercising personal jurisdiction over Great Southern. Molloy v.

Independence Blue Cross, 56 V.I. 155, 172 (V.I. 2012). Under this standard, the Court



must accept as true Plaintiffs’ factual allegations that are supported by affidavits or



Federal Practice and Procedure § 3914.6 (2d ed. West 2014) (“[o]rders refusing to dismiss an action almost always

are not final”).

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other competent, admissible evidence, and all factual disputes will be decided in

Plaintiffs’ favor. Id. at 173.



The Virgin Islands have established a two-part test for determining whether a

litigant is subject to personal jurisdiction. Molloy, 56 V.I. at 173 (citing In re

Najawicz, 52 V.I. 311, 336 (V.I. 2009)). First, the Court evaluates whether the

defendant is subject to personal jurisdiction under the Virgin Islands long arm

statute, codified at V.I. Code Ann. tit. 5, § 4903. Id. Second, the Court must be

satisfied that “the exercise of personal jurisdiction satisfies the requirements of due

process.” Sit. Croix, Lid., 2014 WL 235994, at *3.



“Once challenged, the burden of demonstrating the facts that establish

personal jurisdiction falls on the plaintiff. Belizaire v. Whitecap Inv. Corp., No. 2013-

66, 2014 WL 793135, at *2 (D.V.I. Feb. 26, 2014) (quoting Metcalfe v. Renaissance

Marine, Inc., 566 F.3d 324, 330 (3d Cir.2009)). The “court must take all allegations

in the complaint as true and the plaintiff need only establish a prima facie case of

personal jurisdiction.” Id. (quoting O'Connor v. Sandy Land Hotel Co., 496 F.3d 312,



316 (3d Cir.2007)).

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A. Virgin Islands Long Arm Statute



The Virgin Islands long arm statute permits a court to “exercise personal

jurisdiction over a person, who acts directly or by an agent, as to a claim for relief

arising from the person’s(....



(4) causing tortious injury in this territory by an act or omission outside



this territory if he regularly does or solicits business, or engages in any



other persistent course of conduct, or derives substantial revenue from

goods used or consumed or services rendered, in this territory.



5 V.1.C. § 4903(a)(4).



Applying § 4903(a)(4), it is undisputed that Plaintiffs’ claims arise from the

same conduct that would subject Great Southern to specific personal jurisdiction.

Plaintiffs claim Great Southern sold defective wood products to Putnam, which in

turn sold the products to Paradise Lumber, which in turn sold the lumber to

Plaintiffs. Plaintiffs ascribe the wood’s defective nature to Great Southern’s failure

to properly or sufficiently treat the wood with chemicals to prevent decay. Plaintiffs



incorporated the wood products into their properties and their properties were



* Section 4901 of Title 5 of the Virgin Islands Code defines a person as: “an individual, his executor , administrator,

or other personal representative, or a corporation, partnership, association or any other legal or commercial

entity, whether or not a citizen or domiciliary of this territory and whether or not organized under the laws of this

territory.” As a corporation, Great Southern is considered a person for purposes of § 4903.



* While “[n]Jo court in the Virgin Islands has determined what it means to ‘arise from’ the enumerated acts for the

purposes of section 4903(b)” the Third Circuit, addressing a similar requirement under the constitutional

jurisdiction doctrine of specific jurisdiction, defined the term as requiring the claim to reasonably relate to the

cause of action. Molloy, 56 V.1. at 175 (citing O'Connor v. Sandy Lane Hotel Co., Ltd., 496 F.3d 312, 320 (3d Cir.

2007)}}.

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damaged as a result. Therefore, they have sufficiently alleged that Great Southern

caused a tortious injury in the Territory.



We must now consider whether Great Southern “regularly does or solicits

business, or engages in any other persistent course of conduct, or derives substantial

revenue from goods used or consumed or services rendered in this territory.” 5 V.I.C.

§ 4903(a)(4). “Substantial revenue” is a relative term, and is therefore only

meaningful in some defined context. Part of that context are the special

considerations of this jurisdiction, which has “a small population more than 1,000

miles away from any continent.” Hendrickson v. Reg O Co., 17 V.1. 457, 464 (D.V.I.

1980) aff'd, 657 F.2d 9 (8d Cir. 1981). Thus, “substantia? must be interpreted by

local Virgin Islands standards.” Id.; cf. Samad v. High Soc. Magazine, 20 V.I. 554,

556 (D.V.I. 1984) (taking the nature and unit cost of defendant’s product into account

when determining whether revenue was “substantial” under § 4903(a)(4)). The ratio

of a defendant's total sales to its local sales does not control the analysis.

Hendrickson, 17 V.I. at 464; Hendrickson v. Reg O Co., 657 F.2d 9, 13 (3d Cir. 1981)

(“Hendrickson IT”) (“The substantiality of the revenues must be measured by objective

factors, not the size of the defendant.”).



Plaintiffs allege that between July 2003 and August 2009, Great Southern

derived $2,083,953 in profit for services, including the treatment of wood sold in the

Virgin Islands. Great South agrees that it received $2,083,953 in overall revenue

from Putnam. But Putnam asserts that of that sum only $442,689.24 was paid Great



Southern for lumber and treatment services for wood Putnam sold in the Virgin

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Islands.® In its Reply, Great Southern does not dispute this figure, though it argues

that it received no benefit from Putnam’s decision to sell the wood products in the

Virgin Islands and had no control over the destination of its products.



Great Southern’s alleged revenue of $442,689.24 deriving from the sale of its

products in the Virgin Islands is substantial. Belizaire v. Whitecap Inv. Corp., No.

2013-66, 2014 WL 793135, at *4 (D.V.I. Feb. 26, 2014) (concluding Great Southern

derived substantial revenue from the Virgin Islands based on Putnam’s answers to

interrogatories stating that out of over $2 million in total revenue from lumber sales

to Putnam, Great Southern received $432,884.72 for lumber or treated lumber sold

in the Virgin Islands).7/ Great Southern’s assertion that it did not control the

destination of its products and did not specifically intend for the products to be sold

in the Virgin Islands is irrelevant to our long arm statute. Section 4903 requires only

that the defendant “derives substantial revenue from goods used or consumed or

services rendered” in this Territory. The statute’s terms are objective; there is no

subjective knowledge requirement. Great Southern’s revenue generation from

products sold into this jurisdiction is enough to satisfy the “substantial revenue”



portion of § 4903(a)(4).



* Putnam relies on its answers to interrogatories filed in Stewart v. Whitecap Investment Corp. d/b/a

Paradise Lumber, Civil No. 2012-28, for this data.



? See also MRL Dev. |, LLC v. Whitecap inv. Corp., No. 2013-48, 2014 WL 128198, at *4 (D.V.I. Jan. 14, 2014);

Stewart v. Whitecap Inv. Corp., No. 2012-28, 2013 WL 1163510, at *4 (D.V.I. Mar. 21, 2013); Whitecap Investment

Corp. d/b/a Paradise Lumber v. Putnam Lumber and Export Co., No. 2010-139, 2013 WL 1155351, at *7 (D.V.1. Mar.

21, 2013); Hills v. Whitecap Investment Corp. d/b/a Paradise Lumber, No. ST-12-CV-395, at *2 (Super. Ct. June 14,

2013) (finding that Great Southern received substantial revenue based on similar amounts and similar evidence).

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Finding jurisdiction proper under the Virgin Islands long arm statute, 5 V.1.C.

§ 4903, the Court must now determine whether exercising jurisdiction over Great



South comports with the United States Constitution’s due process clause.



B. Due Process



In the second half of the jurisdictional analysis, the Court must determine

whether its exercise of jurisdiction over Great Southern comports with the

Fourteenth Amendment’s due process clause, which “limits the power of a state court

to exert personal jurisdiction over a nonresident defendant.” Asahi Metal Indus. Co.

uv. Superior Court of California, Solano Cnty., 480 U.S. 102, 108 (1987).



There are two types of personal jurisdiction: general and specific. Molloy, 56

V.I. at 181. General jurisdiction is the broad power to hear all cases against a

defendant based on the defendant’s “continuous and systematic contact with the

forum.” Id. Specific jurisdiction, a narrower type of authority, exists if the defendant

has minimum contacts with the forum and the claim arises out of those contacts. Id.



In this case, the parties dispute whether the Court can exercise specific

jurisdiction over Great Southern based on the Due Process analysis. The Virgin

Islands applies a three-part test to determine whether specific jurisdiction exists.

“First, the defendant must have purposefully directed its activities at the forum.”

Molloy, 56 V.I. at 183. Second, the litigation must arise out of or relate to at least one

of those activities.” Id. Third, jurisdiction must “not offend traditional notions of fair



play and substantial justice.” International Shoe Co. v. State of Wash., 326 U.S. 310,

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316 (1945); Molloy, 56 V.I. at 181-82 (quoting International Shoe, 326 U.S. at 320).

This test ensures “that the defendant has the requisite minimum contacts with a

forum to receive ‘fair warning’ that the defendant may be haled into court in that

forum.” Id. at 183-84 (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472

(1985)).



Great Southern is a corporation organized under the laws of Alabama with a

principal place of business in Alabama. It maintains that it did not direct any

activities to the Virgin Islands, and any alleged contacts were through Putnam, a

third party. Conversely, Plaintiffs and Putnam argue that Great Southern sought

out Putnam as a client specifically because it exports a high volume of lumber outside

the United States.



Contrary to Great Southern’s assertion, there is evidence that it purposefully

directed its business at the Virgin Islands. As early as 2004, when Great Southern

began doing business with Putnam, Great Southern understood Putnam’s main

business was exporting lumber outside the continental United States, and that a lot

of the lumber went to the Caribbean. Deposition Transcript of Justin Wright and

Deposition of Chad Blizzard, Exs. A and B to Putnam’s Opposition to Great

Southern’s Motion to Dismiss. In addition to selling lumber to Paradise Lumber,

where Plaintiffs purchased the defective wood, Putnam also sold lumber to MSI



Building Supplies, a Virgin Islands lumber retailer, and possibly sold wood products

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to other Virgin Islands retailers. Deposition Transcript of Rourke, Ex. D to Plaintiffs’

Opp. to Great Southern’s Motion to Dismiss.



In assessing Great Southern’s intent, the Court notes that a Great Southern

employee emailed a Putnam employee at least twice regarding the Virgin Islands.

On July 22, 2008, a Great Southern representative emailed Putnam explaining that

“any material that goes over seas [sic] does not carry a warranty BUT we can help

you out some with this issue. How many pieces is your customer talking about?”

Email from Mike Simerly to Mike Noble, Ex. G to Plaintiffs’ Opp. to Great Southern’s

Motion to Dismiss. Putnam responded:



I'm not sure that the U.S. Virgin Islands is considered overseas. are



[sic] you saying that the .15 treatment we bought on 5/4” decking



which is approved in the United States is not covered in the United



States Virgin Islands? would [sic] there be any reason it would



disintegrate there and not here? Per our conversation, every piece of



5/4x6/16’ RED treated was purchased from Great Southern and sold



to our only client in St. John, U.S.V.I. what [sic] exactly are you



saying before I ask these questions elsewhere?



Email from Mike Noble to Mike Simerly, Ex. G. to Plaintiffs’ Opp. to Great Southern’s

Motion to Dismiss. On October 20, 2009, the same Great Southern representative

emailed Putnam: “Do you have any TSO items in the works coming to Jesup or any

stock items we can quote into Jax? Have you been loading any flat racks lately out



of Jax, or are the islands still slow?” Email from Mike Simerly to Mike Noble, Ex. H



to Plaintiffs’ Opp. to Great Southern’s Motion to Dismiss. This email demonstrates



8 Plaintiffs assert that Putnam sold wood to Paradise Lumber “and other retailers, including MSI.” However,

Plaintiffs do not identify the alleged other retailers, and offer no evidence to support this assertion.

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that Great Southern knew its products were being sold in the “islands” and that it

was pursuing further opportunities with Putnam to distribute its products to the

Virgin Islands.®



While questions linger as to precisely what Great Southern knew and when,

the evidence indicates Great Southern knew from the outset that Putnam’s main

business was exporting lumber outside the United States, and that the Caribbean

was one of its major markets. By the time of the Great Southern employee’s July

2008 email to Putnam, Great Southern knew its products were being delivered to and

consumed in the U.S. Virgin Islands. After the July 2008 email, from July 23, 2008

through August 3, 2009, Putnam submitted 92 additional purchase orders to Great

Southern. Therefore, for at least that 13 month period, Great South was aware that

its products were being consumed in the U.S. Virgin Islands.



The record also indicates that Great Southern had a business relationship with

Conex Forest Products, Inc., a lumber exporter that also exported to the Caribbean,

including the U.S. Virgin Islands. Great Southern, in partnership with Conex,

advertised its product in the Bahamas and elsewhere in the Caribbean. Exs. E and

F to Putnam’s Opp. to Great Southern’s Motion to Dismiss. Additionally, Conex



employed a designated sales representative for the U.S. Virgin Islands. Deposition



? The email does not specify which “islands” the Great Southern employee was inquiring about. Plaintiffs and

Putnam interpret “islands” as reference to the U.S. Virgin Islands and Great Southern offers no alternative

explanation. Given the July 2008 email and Great Southern’s lack of other interpretation, it is likely that “islands”

refers to the U.S. Virgin Islands.

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Transcript of Bradford Locke, Ex. G., and Deposition Transcript of Eric Sizemore, Ex.

F to Putnam’s Opp. to Great Southern’s Motion to Dismiss.



Despite the above evidence showing that Great Southern directed itself at the

Virgin Islands, Great Southern argues that the United States Supreme Court’s

decision in Walden v. Fiore, 134 S. Ct. 1115 (Feb. 25, 2014) should alter the personal

jurisdiction analysis in this case.



In Walden, the defendant, a Georgia police officer, searched plaintiffs at an

Atlanta airport, found $97,000 in cash, and seized the funds on suspicion that it was

drug money. Jd. The next day, Plaintiffs’ Nevada attorney called the defendant

seeking a return of the funds. Id. After receiving documentation as to the legitimacy

of the money, the cash was returned to plaintiffs. Jd. At some point after seizing the

cash, the defendant police officer helped draft a probable cause affidavit to support

the forfeiture of the funds, and he forwarded the affidavit to a United States

Attorney’s Office in Georgia. Id. Plaintiffs subsequently filed suit in the United

States District Court for the District of Nevada. Jd. at 1120. The Court held that

“[bJecause the defendant had no other contacts with Nevada, and because a plaintiffs

contacts with the forum State cannot be “decisive in determining whether the

defendant's due process rights are violated . . . the court in Nevada may not exercise

personal jurisdiction under these circumstances. Walden, 134 S. Ct. at 1118. “Due

process,” the Court explains, “requires that a defendant be haled into court in a forum

State based on his own affiliation with the State, not based on the “random,



fortuitous, or attenuated” contacts he makes by interacting with other persons

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affiliated with the State. Walden, 134 S. Ct. at 1123 (citing Burger King, 471 U.S. at

475).



Great Southern argues therefore that it cannot be subject to jurisdiction in the

Virgin Islands because its contacts with this jurisdiction are through Putnam, a third

party. Although Great Southern’s contacts were through third party distributors

(Putnam and Conex), it is not automatically immune from prosecution in this

jurisdiction. Unlike the police officer defendant in Walden, Great Southern

knowingly directed business to the Virgin Islands, and sought to serve the market

there. Great Southern’s Caribbean advertising campaign demonstrates that its

contacts with the Virgin Islands were intentional, not “random, fortuitous, or

attenuated.” Walden, 134 S. Ct. at 1123. See, e.g. Hill v. Whitecaop Investment Corp.

d/b/a Paradise Lumber, 2014 V.I. LEXIS 114, *9 (Super Ct. ) (holding that Walden

did not affect the stream of commerce strand of personal jurisdiction analysis while

denying Great Southern’s Motion to Dismiss for lack of personal jurisdiction).



The second specific jurisdiction factor looks to the connection between



Plaintiffs’ claims and Great Southern’s contacts with the Virgin Islands. Plaintiffs’



'° See, e.g., Hill v. Whitecaop Investment Corp. d/b/a Paradise Lumber, No. ST-12-CV-39S, 2013 WL 3185559, at *4

(Super. Ct. June 14, 2013) (“Although Great Southern made the contacts with the forum state at issue here

through a third party, personal jurisdiction is properly asserted by this Court.”); Renner v. Lanard Toys Ltd., 33 F.3d

277, 280 (3d Cir. 1994) (“[u]nderlying the assumption of jurisdiction in these cases is the belief that the fairness

requirements of due process do not extend so far as to permit a manufacturer to insulate itself from the reach of

the forum State's long-arm rule by using an intermediary or by professing ignorance of the ultimate destination of

its products”) (quoting De/ames v. Magnificence Carriers, inc., 654 F.2d 280, 285 (3d Cir. 1981); Samad v. High Soc.

Magazine, 20 V.1. 554, 556 (D.V.|. 1984) (“Defendant does not insulate itself from liability in this jurisdiction merely

by passing its publication through an independent distributor. High Society places its publication into the stream of

commerce with the knowledge that a certain, not insignificant, number of copies will be sold within the

jurisdiction. It thus engages in a “persistent course of conduct” within the meaning of 5 V.I.C. § 4903(a)(4)).

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claims unquestionably arise out of Great Southern’s contacts with the forum. They

allege that Great Southern sold defective wood products to Putnam, which sold the

wood to Paradise Lumber, a retailer in St. John, and that the defective wood damaged

their properties. Therefore, this element is satisfied.



Finally, the third jurisdictional factor is itself a multi-faceted inquiry. To

determine whether jurisdiction would offend traditional notions of fair play and

substantial justice, the Court is guided by the following factors: “the burden on the

defendant, the forum State’s interest in adjudicating the dispute, the plaintiff's

interest in obtaining convenient and effective relief, the judicial system’s interest in

obtaining the most efficient resolution of controversies, and the shared interest of the

several States in furthering fundamental substantive social policies.” Molloy, 56 V.I.

at 184 (citing Burger King Corp., 471 U.S. at 477).



The burden on Great Southern is not particularly great at this juncture, as it

has or is still defending itself in six other similar cases in this jurisdiction. Great

Southern has provided wood treatment services and occasionally lumber to lumber

exporting businesses. In doing so, Great Southern should expect that claims may

arise in any of the far-flung places its treated lumber goes. Plaintiffs’ interest in

obtaining relief coincides with the judicial system’s interest in efficiently resolving

controversies because the damaged properties are located in this jurisdiction and

some of the plaintiffs reside here. Therefore, exercising jurisdiction over Great



Southern does not offend principles of fair play and substantial justice.

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Having analyzed the due process part of this jurisdictional puzzle, the Court

finds that its exercise of jurisdiction over Great Southern is consistent with due

process.



CONCLUSION



This Court finds that Great Southern is subject to this Court’s jurisdiction

under the Virgin Islands long arm statute because Great Southern derives

“substantial revenue” from the Virgin Islands. 5 V.I.C. § 4903(a)(4).



In addition, exercise of jurisdiction over Great Southern comports with the

Fourteenth Amendment’s due process clause. Therefore, Great Southern’s motions to

dismiss will be denied.



The Court will enter an Order consistent with this Opinion.



DATED: April kad 2016 LE Si Gye aa



Kathleen Mackay

Judge of the Superior Court

of the Virgin Islands



ATTEST:

ESTRELLA H. GEORGE



Court



lerk Supervisor (tile