## Facts

- ESAB Group, Inc., a South Carolina-based manufacturer of welding and cutting systems, sued Centricut, Inc., a New Hampshire mail-order competitor, and Centricut’s CEO, Thomas Aley.
- ESAB alleged defendants conspired to misappropriate ESAB’s trade secrets and customer information, including through information obtained from a former ESAB employee.
- Centricut operated from New Hampshire and asserted it had no offices, property, or targeted advertising in South Carolina and only a small number of South Carolina customers.
- ESAB brought a federal civil RICO claim and multiple related state-law claims (including conspiracy, unfair competition, and misappropriation).
- Defendants moved to dismiss for lack of personal jurisdiction; the district court denied the motion, relying on South Carolina’s long-arm statute and an “effects” theory tied to intentional harm to a South Carolina plaintiff.
- Defendants took an interlocutory appeal challenging personal jurisdiction.

## Issues

1. Whether South Carolina’s long-arm statute and Fourteenth Amendment due process permitted personal jurisdiction over defendants whose forum contacts were limited but who allegedly committed intentional torts causing injury to a South Carolina plaintiff.
2. Whether civil RICO’s nationwide service of process provision supplied personal jurisdiction consistent with Fifth Amendment due process.
3. Whether, once personal jurisdiction existed over the RICO claim, the court could exercise pendent personal jurisdiction over factually related state-law claims.

## Decision

- The Fourth Circuit held the district court erred in finding personal jurisdiction based solely on South Carolina’s long-arm statute and the defendants’ limited South Carolina contacts.
- The court nonetheless held personal jurisdiction existed under civil RICO because the statute authorizes nationwide service of process and Fifth Amendment due process was satisfied.
- The court held the district court could exercise pendent personal jurisdiction over related state-law claims arising from the same nucleus of operative fact as the RICO claim.
- The court affirmed in part, reversed in part, and remanded.

## Legal Principles

- Under the Fourteenth Amendment, a state long-arm assertion of specific jurisdiction requires minimum contacts with the forum such that the defendant could reasonably anticipate being sued there; intentional injury to a forum resident, without sufficient forum-directed contacts, is not enough.
- When a federal statute authorizes nationwide service of process, personal jurisdiction may be based on service within the United States, subject to Fifth Amendment due process.
- Fifth Amendment due process in the nationwide-service context focuses on the defendant’s contacts with the United States as a whole and whether litigating in the chosen forum is so gravely inconvenient as to be fundamentally unfair.
- A federal court with personal jurisdiction over a defendant on a claim supported by nationwide service may, in appropriate cases, exercise pendent personal jurisdiction over additional claims that arise from the same nucleus of operative fact.

## Conclusion

The Fourth Circuit rejected state long-arm jurisdiction over out-of-state defendants with attenuated South Carolina contacts, but sustained jurisdiction under civil RICO’s nationwide service provision and permitted related state-law claims to proceed under pendent personal jurisdiction, subject to Fifth Amendment fairness limits.


ESAB Grp., Inc. v. Centricut, Inc., 126 F.3d 617 (4th Cir. 1997)