[Cite as InFrasys, Inc. v. Bros. Pavement Prods., Corp. , 2020-Ohio-1157.]

IN THE COURT OF APPEALS OF OHIO SIXTH APPELLATE DISTRICT ERIE COUNTY

InFrasys, Inc., et al. Court of Appeals No. E-19-047 Appellants Trial Court No. 2018 CV 0332

v. Brothers Pavement Products, Corp., et al. DECISION AND JUDGMENT Appellees Decided: March 27, 2020

* * * * * James L. Murray, Dennis E. Murray, Jr. and William H. Bartle, for appellants. James W. Hart and Mark P. Smith, for appellees.

* * * * * ZMUDA, P.J. {¶ 1} This matter is before the court on appeal from the judgment of the Erie County Court of Common Pleas, granting the motion to dismiss fo r lack of personal2. jurisdiction of appellees Walsh & Hughes, Inc., dba VelveTop Pr oducts, Inc. and John B.

Walsh. I. Facts and Procedural Background {¶ 2} Appellants, InFrasys, Inc. and ThorWorks Industries, Inc. are r elated Minnesota corporations, with their principal place of business in Erie County, Ohio. ThorWorks owns the SealMaster brand, and manufactures and sells seal coating products and equipment to SealMaster system franchises. InFrasys overse es and supports the franchise owners, and protects the SealMaster brand. InFrasys is the franchisor for the SealMaster system. {¶ 3} Walsh & Hughes, Inc. dba VelveTop Products, Inc. (“VelveTop”) i s a New York corporation, with John B. Walsh as the president and owner . Brothers Pavement Products, Corp. (Brothers) is a New York corporation doing busi ness with VelveTop. John K. Walsh and James K. Walsh are the owners/operators of Br others. John B. Walsh

is the father of John K. and James K. Walsh. {¶ 4} The facts alleged by appellants regarding appellees, relative t o the issue of personal jurisdiction, are as follows. {¶ 5} In July 2007, John B. Walsh traveled to Ohio to negotiate Velve Top’s sale of SealMaster products to the Long Island, New York area. John B. Walsh followed up by phone to InFrasys in Ohio to continue negotiations, and resp onded to correspondence from InFrasys on behalf of his sons and their company, Brothers . The franchise3. negotiations resulted in the Supplier Agreement between VelveTo p and Brothers, and a Franchise Agreement between InFrasys and Brothers. {¶ 6} On April 11, 2008, appellee VelveTop entered into a Supplier Ag reement with Brothers. The agreement concerned the production and supp ly of SealMaster products to VelveTop, requiring VelveTop to cease manufacture o f its sealers pursuant to a contractual phase-in of purchasing SealMaster products from B rothers, with 100 percent of seal coat products purchased from Brothers within th ree years, and 100 percent of asphalt emulsion sealer purchased from Brothers commencing t he first day Brothers began manufacture of the sealants. The Supplier Agreement also expressly referenced the InFrasys franchise as follows: 4. Notwithstanding the terms and conditions of this agreement , it is the understanding between the respective parties that all other terms and conditions which would apply to market conditions, such as pric ing, supply, need, etc. will apply and that this agreement is entere d into based on the familial relationship between the principals of the part ies to this agreement and as an inducement for INFRAYSIS [sic], INC. to grant its

franchise to BROTHERS PAVEMENT PRODUCTS CORP. (Emphasis added.) {¶ 7} InFrasys and Brothers executed the InFrasys, Inc. Franchise Agr eement on June 11, 2008. The franchise agreement recited a term of ten y ears, and granted Brothers the right to a SealMaster sales and distribution business, with additional permission to4. manufacture pavement sealers marketed with the SealMaster brand . The franchise was exclusive within Brother’s New York territory. Pursuant to the Franchise agreement, InFrasys permitted Brother’s use of all SealMaster proprietary marks and copyrighted materials, and shared the InFrasys confidential operations manu al and other confidential information, including processes, systems, and product specific ations. {¶ 8} The Franchise agreement expressly referenced VelveTop in Paragr aph

XVI.H. as follows: H. Special Provisions Regarding VelveTop Products, Inc. Anyt hing in this Paragraph XVI. to the contrary notwithstanding, Franchi sor, Franchisee and the individual shareholders of Franchisee (the “ Individual Shareholders”) who are executing this Agreement (who are also d eemed to be “Franchisees” by virtue of Paragraph XVI.B) hereby agree as follows: 1. Franchisor acknowledges that John B. Walsh (“John Sr.”) is the father of the Individual Shareholders and that he owns and oper ates a business by the name of VelveTop Products, Inc. (“VelveTop”), w hich will be in direct competition with the franchised Business after com mencement of the terms of this Agreement. 2. Franchisor agrees that VelveTop and John Sr. may continue their current business under the terms of a Supplier Agreement with F ranchisee,5. a copy of which is attached as Exhibit C. 1 The Supplier Agreement shall continue in force between the parties thereto through the term of this Agreement and may not be amended without prior consent of Franc hisor. Franchisor further agrees that the Supplier Agreement may be as signed at the time of any sale of VelveTop. As referenced in the Supplie r Agreement, Franchisor defines DECO SURFACING PRODUCTS to be any product in direct competition with the Franchisor’s SportMa ster brand. {¶ 9} The Franchise Agreement contained a choice of law and venue cla use, requiring Ohio law and jurisdiction in Erie County, Ohio, with a waiver of personal jurisdiction in Paragraph XXIX.B. Both John K. and James K. Wa lsh executed the Agreement on behalf of Brothers. {¶ 10} On February 6, 2018, appellants terminated the franchise of Bro thers alleging numerous breaches of the Franchise Agreement, includin g the failure to enforce the terms of the Supplier Agreement between VelveTop and Brothe rs. On June 14, 2018, appellants filed a complaint in Erie County Common Pleas Court, alleging breach of the Franchise Agreement and Supplier Agreement, and seeking monetar y and injunctive relief. As to VelveTop and John B. Walsh, appellants alleged t ortious interference with a business/contractual relationship, and claimed VelveTop failed to comply with the

1 Exhibit A delineated the geographical territory for the franch ise of Brothers, and Exhibit B contained personal guaranties and assumptions of obligations by John K. and James K. Walsh, each owning 50 percent in Brothers

.6. phase-in periods in the Supplier Agreement and continued to man ufacture its own sealers. Appellants further alleged that Brothers sold “ingredients” for this unauthorized manufacture rather than the finished product. {¶ 11} Appellants alleged that ThorWorks is an intended third-party be neficiary of the Franchise Agreement and Supplier Agreement, and InFrasys is an intended thirdparty beneficiary of the Supplier Agreement. {¶ 12} After extensions, discovery disputes, and limited discovery reg arding the issue of jurisdiction, VelveTop and John B. Walsh filed a motio n to dismiss, alleging lack of personal jurisdiction. InFrasys and ThorWorks opposed dismi ssal. They alleged John B. Walsh controlled the negotiations for both VelveTop and his sons’ company, Brothers, traveled to Ohio for initial negotiations, called InFrasys in O hio for continued negotiations, and sent his VelveTop trucks to ThorWorks in Sand usky, Ohio, to pick up SealMaster materials and products. {¶ 13} While apparently acknowledging John B. Walsh’s participation in negotiations and his visit to Sandusky in 2007, appellees argue d that they never had an intention to enter into any agreement with appellants, and lack ed the necessary contact with the forum state to permit an exercise of personal jurisdic tion. {¶ 14} The trial court determined the motion based on the memoranda, a ffidavits and deposition transcripts submitted in support. 2 The trial court noted the applicable

2 The record on appeal does not include the deposition transcrip ts.7. standard in ruling without hearing, that appellants need only m ake “a prima facie showing of jurisdiction” to survive the motion to dismiss. In applying the standard under R.C. 2307.382 and Civ.R. 4.3(A)(1), the trial court determined that appellants satisfied the first prong of the Goldstein test, finding an exercise of personal jurisdiction proper under the long-arm statute and applicable civil rule based on Goldstein v. Christianson , 70 Ohio St.3d 232, 235-236, 638 N.E.2d 541 (1994). As to the s econd prong, however, in applying the three-part test for due process, the trial cour t found that VelveTop and John B. Walsh had the required minimum contacts and caused inju ry within the forum state. The court determined, however, that the exercise of per sonal jurisdiction would be unreasonable and deprive VelveTop and John B. Walsh of due proc ess. {¶ 15} As to this third factor of the due process analysis, the trial court found the lack of evidence regarding frequency of travel to the ThorWorks site by VelveTop trucks weighed against personal jurisdiction. The trial court, furthe rmore, noted that VelveTop and John B. Walsh executed the Supplier Agreement two months pr ior to execution of the Franchise Agreement, and made no mention of any connection between the two agreements, as alleged by appellants. {¶ 16} The trial court granted dismissal of VelveTop and John B. Walsh for want of personal jurisdiction, and entered a finding of no just caus e for delay. In a subsequent “Nunc Pro Tunc” entry, the trial court sua sponte revised its j udgment, striking the final appealable language from the dismissal judgment entry. After a ppellants moved to8. reinsert the final appealable language, the trial court did so, finding the dismissal judgment entry to be final and appealable once more. II. Assignments of Error {¶ 17} InFrasys and ThorWorks now appeal the dismissal, asserting the following assignments of error: 1. The Trial Court Erred in Granting Defendants, Walsh & Hugh es, Inc., dba VelveTop Products, Inc. and John B. Walsh’s Motion to Dismiss Plaintiffs’ Complaint for Lack of Personal Jurisdiction. 2. The Trial Court Erred in Removing, Via its 8-13-2019 Nunc Pro

Tunc Judgment Entry, the Civil Rule 54(B) Certification Included in its Initial Judgment Entry of 8-7-2019. The 8-7-2019 Judgment Entr y Granting Defendants, Walsh & Hughes, Inc. and John B. Walsh’s M otion

to Dismiss for Lack of Personal Jurisdiction Was and Remains a Final Appealable Order. III. Analysis {¶ 18} Because the parties dispute whether the trial court’s judgment entry of dismissal constituted a final appealable order, we address appe llants’ second assignment of error first, as a threshold matter. 3

3 Appellees did not seek to dismiss this appeal for want of a fi nal appealable order.9. A. Final Order {¶ 19} In dismissing VelveTop and John B. Walsh as defendants for want of personal jurisdiction, the trial court initially included Civ.R . 54(B) language in the judgment entry, finding no just cause for delay. The Rule perm its appeal of an otherwise interlocutory order pertaining to only some of the parties, if the judgment determines the action as to those parties and includes the determination that there is “no just reason for delay.” See Civ.R. 54(B) (“* * * [T]he court may enter final judgment as t o one or more but fewer than all of the claims or parties only upon an expres s determination that there is no just reason for delay.”). {¶ 20} Days later, the trial court ordered, sua sponte, the Civ.R. 54( B) language stricken from the judgment of dismissal through a nunc pro tunc entry. As an initial matter, we note that a nunc pro tunc entry is properly used to correct a judgment entry so that it reflects the action actually taken by the court, and no t to amend an entry to effect substantive change. As the Ohio Supreme Court noted in State ex rel. Rogers v. Rankin , 154 Ohio St. 23, 26, 93 N.E.2d 281(1950): “It is elementary that courts possess inherent common-law powe r to enter judgments or orders nunc pro tunc in proper cases. The p hrase meaning simply ‘now for then’ is accurately descriptive. The g eneral purpose of such an entry is to record a prior but unrecorded ac t of the court. In other words, the power to make nunc pro tunc entries is rest ricted ordinarily to the subsequent recording of judicial action previ ously and10. actually taken. It is a simple device by which a court may mak e its journal speak the truth.” (Citation omitted.) The clerical purpose of a nunc pro tunc entry means a court may not amend a final judgment, nunc pro tunc, to deprive the parties of “any rights which the previous order had accorded * * * nor make that order any less final * * *.” Green v. Ken’s Flower Shops , 6th Dist. Lucas No. L 94-088, 1994 WL 620732, *1-2 (Nov. 10, 19 94), quoting Huntington National Bank, v. Hebeka , 6th Dist. Lucas Nos. L 90-318 and L 90-360, 1992 WL 323945 (Jan. 4, 1991); Perfec. Stove Co. v. Sherber , 120 Ohio St. 445, 448, 166 N.E. 376 (1929). {¶ 21} Here, the trial court attempted to substitute a new and differe nt action, striking the original finding of “no just cause for delay.” Th ere appears no record, furthermore, supporting appellees’ argument that the trial cour t intended the judgment to be merely interlocutory from the outset. The record, instead, demonstrates a judgment containing Civ.R. 54(B) language, and an attempt to substantive ly change the judgment through a nunc pro tunc entry, only to be amended once more in a third entry. The change, accordingly, sought to reverse an action taking in the final judgment, with no record to support a finding that the nunc pro tunc entry merely recorded an action already taken. Therefore, the trial court could not convert its final appealable order by nunc pro tunc entry. {¶ 22} The trial court, furthermore, had no jurisdiction to modify the final appealable order sua sponte. Generally, a trial court lacks au thority to vacate or modify a11. final judgment, sua sponte, without a written motion under Civ. R. 60(B) seeking relief from judgment. (Citation omitted.) Midwest Environmental Controls, Inc. v. Houttekier , 6th Dist. Lucas No. L-04-1118, 2004-Ohio-5999, ¶ 3; see also Maxwell v. Univ. Hosps. Health Sys., Inc. , 8th Dist. Cuyahoga No. 104100, 2016-Ohio-7401, ¶ 5, citing Allstate

Ins. Co. v. Witta , 9th Dist. Summit No. 25738, 2011-Ohio-6068, ¶ 19, citing Pitts v. Ohio Dept. of Transp. , 67 Ohio St.2d 378, 380, 423 N.E.2d 1105 (1981) (“A trial court may only relieve a party from judgment by the mechanisms provided b y the Ohio Rules of Civil Procedure.”). The trial court, therefore, erred in attemp ting to modify the final judgment entered as to VelveTop and John B. Walsh without a pro per written motion, and its subsequent judgment entries were a nullity. 4 {¶ 23} Finally, we note that a dismissal for lack of personal jurisdic tion has been determined as appropriate for appeal where the judgment prevent s a refiling in the trial

court. In Natl. City Commercial Capital Corp. v. AAAA At Your Serv., Inc. , 114 Ohio St.3d 82, 868 N.E.2d 663, 2007-Ohio-2942, ¶ 10, the Ohio Suprem e Court considered whether dismissal for lack of personal jurisdiction constituted a final appealable order. In that case, the court noted that parties challenging the asserti on of personal jurisdiction may appeal the judgment. Id. , citing Goldstein , 70 Ohio St.3d at 235, 638 N.E.2d 541, citing State ex rel. Bradford v. Trumbull Cty. Court , 64 Ohio St.3d 502, 597 N.E.2d 116

4 While no party argues the trial court lacked authority to ente r a third judgment entry, restoring the language of the first, the initial entry constitu ted a final appealable order, and therefore any subsequent action, entered without a motion u nder rule permitting modification, was without authority and a nullity.12. (1992) and State ex rel. Pearson v. Moore , 48 Ohio St.3d 37, 548 N.E.2d 945 (1990). A party challenging the opposite result, therefore, should also h ave the ability to appeal. In Natl. City , the dismissal prevented a refiling in the trial court, despit e indicating it was without prejudice. In that case, the Supreme Court held, “[i]t is not logical to allow a party that believes a court wrongly asserted jurisdiction to ap peal but to prevent a party that believes a court wrongly did not assert jurisdiction from appealing.” Natl. City at ¶ 10. {¶ 24} In this case, appellants assert exclusive jurisdiction in Erie County, Ohio, as to all defendants, pursuant to the Franchise Agreement, whic h purportedly incorporates the Supplier Agreement. The trial court’s ruling, finding no personal jurisdiction over appellees, prevents a refiling in that court. Therefore, considering the trial court’s determination of a final appealable order under c ircumstances that prevented refiling in the trial court, we find appellants’ second assignm ent of error well-taken, and find this matter is properly before us on appeal.

B. Personal Jurisdiction {¶ 25} In their first assignment of error, appellants argue the trial court erred in finding it lacked personal jurisdiction over appellees. Appell ants alleged personal jurisdiction based on contacts with the forum state, and in the alternative, based on a consent to jurisdiction within the Franchise Agreement. {¶ 26} As to appellants’ claim of consent to jurisdiction pursuant to the Franchise Agreement, we note appellants rely—in part—on argument going to the merits of their13. third-party beneficiary claims. Appellants seek to enforce the forum selection clause of the Franchise Agreement against VelveTop and John B. Walsh as n on-signatories who benefited from the arrangement. 5 The issue before us is personal jurisdiction, and because our determination of minimal contacts and due process i s dispositive, we do not reach the merits of appellants’ claims. {¶ 27} When a nonresident defendant seeks dismissal pursuant to Civ.R. 12(B)(2), the plaintiff bears the burden of demonstrating proper jurisdic tion. Ashton Park Apts., Ltd. v. Carlton-Naumann Constr., Inc. , 6th Dist. Lucas No. L-08-1395, 2009-Ohio-6335, ¶ 12, citing Jurko v. Jobs Europe Agency , 43 Ohio App.2d 79, 334 N.E.2d 478 (8th Dist.1974). “Personal jurisdiction is a question of law that appellate cou rts review de

novo.” Kauffman Racing Equip., LLC v. Roberts , 126 Ohio St.3d 81, 2010-Ohio-2551, 930 N.E.2d 784, ¶ 27.

5 Appellants rely on Villanueva v. Barcroft , 822 F. Supp.2d 726 (N.D.Ohio 2011), where a non-signatory sought to enforce a forum selection clause agai nst a signatory party. The facts in the present case are distinguishable, and more aligned with the facts in the Third Circuit Court of Appeals case of E.I. DuPont de Nemours and Co. v. Rhone Poulenc Fiber and Resin Interm., S.A.S. , 269 F.3d 187 (3d Cir.2001). In E.I. DuPont , the Third Circuit noted that a non-signatory could be bound to a forum se lection clause under contract principles governing third-party beneficiaries to the underlying agreement. Citing Coastal Steel Corp. v. Tilghman Wheelabrator Ltd. , 709 F.2d 190, 202-204 (3d Cir.1983), overruled on other grounds by Lauro Lines v. Chasser , 490 U.S. 495, 109 S.Ct. 1976, 104 L.Ed.2d 548 (1989).14. {¶ 28} Where the trial court determines the matter without an evidenti ary hearing, 6 appellants need only make a prima facie showing of jurisdiction

. Kauffman at ¶ 27, citing Fallang v. Hickey , 40 Ohio St.3d 106, 107, 532 N.E.2d 117 (1988). A prima facie showing of personal jurisdiction requires “sufficient evidence to allow reasonable minds to conclude that personal jurisdiction exists over the defendan t.” Figley v. Ivex Protective Packaging, Inc. , 2016-Ohio-3501, 70 N.E.3d 12 (3d Dist.), quoting Parshall v. PAID, Inc. , 10th Dist. Franklin No. 07AP-1019, 2008-Ohio-3171, ¶ 9, citin g Goldstein v.

Christiansen , 70 Ohio St.3d 232, 236, 638 N.E.2d 541 (1984) (additional cit ation omitted.). We “view allegations in the pleadings and the docum entary evidence in a light most favorable” to appellants and resolve “all reasonable compe ting inferences” in appellants’ favor in making the determination. Kauffman at ¶ 27, citing Goldstein at 236. {¶ 29} Courts apply a two-step analysis in determining the proper exer cise of personal jurisdiction over a nonresident defendant, with the se cond prong requiring consideration of three factors. This analysis requires determi nation of “(1) whether the long-arm statute and the applicable rule of civil procedure con fer jurisdiction and, if so,

6 Unlike a Civ.R. 12(B)(6) motion, which limits review to the pl eading, a court may consider outside evidence in determining its own jurisdiction, and may also hold an evidentiary hearing. See, e.g., Jurko v. Jobs Europe Agency , 43 Ohio App.2d 79, 85, 334 N.E.2d 478, 482 (8th Dist.1975) (“When a court considers a chal lenge to its jurisdiction over a defendant-a defense which may require the taking of exte nsive evidence-the court may hear the matter on affidavits, deposition, interrogatories, or receive oral testimony, as matters of jurisdiction are very often not apparent on the f ace of the summons or complaint.”).15. (2) whether the exercise of jurisdiction would deprive the nonr esident defendant of the right to due process of law under the Fourteenth Amendment to t he United States

Constitution.” Kauffman at ¶ 28, citing U.S. Sprint Comm. Co. Ltd. Ptnshp. v. Mr. K’s Foods, Inc. , 68 Ohio St.3d 181, 183-184, 624 N.E.2d 1048 (1994). Here, the trial court found the first prong satisfied, and the first two factors unde r the second prong met, but ultimately determined that exercise of personal jurisdiction of fended due process under the final factor of the due process analysis. For the reasons that follow, we disagree with

the trial court’s conclusion.

1. Jurisdiction Pursuant to Statute or Rule {¶ 30} Ohio’s long-arm statute, R.C. 2307.382 enumerates conduct that will permit a court’s exercise of personal jurisdiction, including: (A)(1) Transacting any business in this state;

* * * (A)(4) Causing tortious injury in this state by an act or omis sion outside this state if he regularly does or solicits business, o r engages in any other persistent course of conduct, or derives substantial reve nue from goods used or consumed or services rendered in this state;

* * * (A)(6) Causing tortious injury in this state to any person by an act outside this state committed with the purpose of injuring perso ns, when he16. might reasonably have expected that some person would be injure d thereby in this state[.] Civ.R. 4.3(A), likewise, permits service of process on nonresid ents who have “caused an event to occur out of which the claim that is the subject of th e complaint arose” based on “(1) Transacting any business in this state[.]” Civ.R. 4.3(A)( 1). {¶ 31} The “transacting any business” standard is “a broad statement o f jurisdiction[.]” U.S. Sprint Communications Co. Ltd. Partnership v. Mr. K’s Foods, Inc. , 68 Ohio St.3d 181, 185, 624 N.E.2d 1048 (1994), citing R.C. 230 7.382(A)(1). “Transact,” means “to prosecute negotiations; carry on business ; to have dealings * * *. The word embraces in its meaning the carrying on or prosecution of business negotiations but it is a broader term than the word ‘contract’ and may invol ve business negotiations which have been either wholly or partly brought to a conclusion * * *.” Kentucky Oaks Mall Co. v. Mitchell’s Formal Wear, Inc. , 53 Ohio St.3d 73, 75, 559 N.E.2d 477 (1990), quoting Black’s Law Dictionary, 1341 (5 Ed.1979). {¶ 32} Appellants referenced documentary evidence to support their all egations,

which are as follows. John B. Walsh initiated the contact with the forum state by traveling to Sandusky Ohio in 2007 to inquire about VelveTop be coming a SealMaster franchise. John B. Walsh followed up this contact with phone c alls, leading negotiations in order to facilitate a Brothers’ franchise, as an alternative to VelveTop obtaining the franchise. John B. Walsh executed the Supplier Agreement with Brothers on behalf of VelveTop, and that agreement expressly stated its purpose was t o induce InFrasys to17. grant the franchise to his sons, and their company, Brothers. John B. Walsh also sent VelveTop trucks to Ohio on numerous occasions each year, to pic k up materials and goods from ThorWorks. Additionally, after InFrasys and ThorWor ks raised concerns of a potential breach of the Supplier Agreement, John B. Walsh att ended a meeting in Sandusky regarding the issue, and John B. Walsh spoke on behalf of his sons and Brothers. Based on these allegations, reasonable minds could c onclude that appellants satisfied their burden of establishing a prima facie showing of personal jurisdiction over appellees, in conformity with R.C. 2307.384 and Civ.R. 4.3.

2. Due Process {¶ 33} Once we determine that appellants satisfied both the Ohio long- arm statute and rule, we must consider whether the exercise of personal jur isdiction comports with due process. Although the long-arm statute permits exercise of personal jurisdiction, an Ohio court may only do so if the exercise of jurisdiction would not violate constitutional rights to due process. Kauffman, 126 Ohio St.3d 81, 2010-Ohio-2551, 930 N.E.2d 784, at ¶ 45. {¶ 34} “[D]ue process is satisfied if the defendant has ‘minimum conta cts’ with

the forum state such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’” Kauffman at ¶ 45, quoting Internatl. Shoe Co. v. Washington , 325 U.S. 310, 316, 66 S.Ct.154, 90 L.Ed.95 (1945) (additional citation omitted.). Where a defendant “purposefully avails” themself “o f the privilege of conducting activities within the forum state,” the minimum-cont acts requirement is18. deemed to be met. Kauffman at ¶ 45, quoting Hanson v. Denckla , 357 U.S. 235, 253, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1968). {¶ 35} We apply a three-part test to determine whether a defendant has the minimum contacts necessary for exercise of personal jurisdictio n and necessary to satisfy due process. Henderson v. SMC Productions, Inc. , 6th Dist. Erie No. E-18-003, 2019- Ohio-5275, ¶ 64. To demonstrate the necessary contacts, appell ants must demonstrate that (1) appellees “purposefully availed” themselves of the pri vilege of acting in Ohio or causing a consequence in Ohio; (2) the cause of action must ari se from appellees’ activities in Ohio, and (3) the appellees’ acts or consequences must have a substantial enough connection with Ohio to make exercise of jurisdiction re asonable. Henderson at ¶ 64, citing Ohlman Farm & Greenhouse, Inc. v. Kanakry , 6th Dist. Lucas No. L-13-1264, 2014-Ohio-4731, ¶ 26; see also Kauffman at ¶ 48-49, quoting Southern Machine Company v. Mohasco Ind., Inc. , 401 F.2d 374, 381 (6th Cir.1968); Bird v.

Parsons , 289 F.3d 865, 874 (6th Cir.1989). a. Purposeful Availment {¶ 36} To demonstrate “purposeful availment,” appellants must show tha t appellees’ contact proximately resulted from appellees’ own con duct that created a

“substantial connection” with Ohio. Kauffman at ¶ 51, citing Burger King Corp. v.

Rudzewicz , 471 U.S. 462, 475, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985) (addit ional citation omitted.). A substantial connection is required to ensure “tha t a defendant will not be19. haled into a jurisdiction solely as a result of ‘random,’ ‘fort uitous,’ or ‘attenuated’

contacts.” Kauffman at ¶ 51, citing Burger King at 474-475

. {¶ 37} Here, appellants made a prima facie showing as to the first fac tor of the test. Appellants presented evidence, demonstrating VelveTop, t hrough John B. Walsh, first sought an Ohio-based SealMaster franchise opportunity for VelveTop. He later negotiated the franchise on behalf of Brothers, and as induceme nt for InFrasys to grant the franchise to Brothers, VelveTop and Brothers entered into a Supplier Agreement. VelveTop benefited from the combined deal by gaining access to the SealMaster catalog and brand, pursuant to the terms of the Supplier Agreement. Ne gotiations took place in Ohio, and VelveTop traveled to Ohio three or four times each ye ar to pick up product from ThorWorks. After InFrasys determined that breach of the S upplier Agreement and Franchise Agreement had occurred, resulting in diminished royal ties under the Franchise Agreement, John B. Walsh traveled to Ohio to discuss the breach of the agreements. Considering the allegations, with supporting evidence as to the factor used in determining prima facie support for personal jurisdiction, we find appellan ts satisfied the first factor.

b. Harm Caused in the Forum State {¶ 38} As to the second part of the test, appellants must show that th e cause of action arose, in Ohio, as a result of appellees’ activities. “If a defendant’s contacts with the forum state are related to the operative facts of the contr oversy, then an action will be

deemed to have arisen from those contacts.” Kauffman at ¶ 70, quoting CompuServe, Inc.

v. Patterson , 89 F.3d 1257, 1267 (6th Cir.1996). Only a “relation” is nece ssary, as the20. test “does not require that the cause of action formally ‘arise from’ defendant’s contacts with the forum; rather, this criterion requires only ‘that the cause of action, of whatever type, have a substantial connection with the defendant’s in-sta te activities.’” Kauffman at ¶ 70, quoting Third Natl. Bank in Nashville v. WEDGE Group, Inc., 882 F.2d 1087, 1091 (6th Cir.1989), quoting S. Machine Co., 401 F.2d at 384, fn. 27. {¶ 39} Here, appellants alleged that the conduct of VelveTop and John B. Walsh, in failing to honor the Supplier Agreement, caused damages to t heir business in Erie County, Ohio. Specifically, appellants alleged that VelveTop f ailed to purchase SealMaster finished products and equipment from Brothers, depri ving InFrasys of royalties, fees, and income due under the Franchise Agreement, and depriving ThorWorks of revenue and profits from the sale of these product s. Additionally, as to VelveTop and John B. Walsh, appellants alleged a claim for inte rference with the business relationship with Brothers by refusing to honor the Su pplier Agreement. Appellants supported their allegations with affidavit testimony , describing violations of the Supplier Agreement and John B. Walsh’s admission of violati ons. Considering the allegations, with supporting evidence as to the factor used in determining prima facie support for personal jurisdiction, we find appellants satisfied the second factor.

c. Inference of Reasonableness {¶ 40} Once a plaintiff satisfies the first two parts of the test by d emonstrating a prima facie case, “‘then an inference arises that this third fa ctor is also present.’” Kauffman at ¶ 71, quoting CompuServe, Inc ., 89 F.3d at 1268, citing Am. Greetings Corp.21. v. Cohn , 839 F.2d 1164, 1170 (6th Cir.1988). This inference applies i n all but “the

unusual case.” Kauffman at ¶ 71, quoting Am. Greetings , 839 F.2d at 1170, quoting First Natl. Bank of Louisville v. J.W. Brewer Tire Co. , 680 F.2d 1123, 1126 (6th Cir.1982). {¶ 41} The trial court determined appellants satisfied the first two f actors, but not the third, without any discussion of the inference pertaining t o the third test. Moreover, the trial court noted the “sporadic” visits to Ohio and lack of evidence on how frequent VelveTop picked up materials each year, as well as the fact tha t VelveTop and John B. Walsh were not signatories to the Franchise Agreement. Essenti ally, the trial court addressed the third factor as a stand-alone requirement, lackin g any benefit of an inference arising from satisfaction of the first two prongs. T he trial court elevated this third factor by apparently requiring appellants to produce evid ence of the frequency of VelveTop’s presence in Ohio, a most stringent standard for prov ing the third factor considering the applicable authority. {¶ 42} Contrary to the trial court’s interpretation, the final inquiry regarding due process is whether the claim has enough connection to Ohio to m ake exercise of jurisdiction over appellees reasonable. Resolution of this tes t, considering the applicable inference, “involves merely ferreting out the unusual cases whe re [Ohio’s interest in resolving the dispute] cannot be found.” S. Machine Co., 401 F.2d at 384. The Ohio General Assembly provides guidance in determining Ohio’s intere st, as outlined in Ohio’s long-arm statute, which provides for jurisdiction over t hose who transact business in this state or cause tortious injury within this state. R.C. 2307.382(A)(1), (4), and (6).22. {¶ 43} Exercise of personal jurisdiction does not offend due process i n this instance. “A State generally has a ‘manifest interest’ in prov iding its residents with a convenient forum for redressing injuries inflicted by out-of-st ate actors.” (Citations omitted.) Burger King , 471 U.S. at 473, 105 S.Ct. 2174, 85 L.Ed.2d 528. In cases wh ere an out-of-state actor has purposefully acted and derived a bene fit from their activities, moreover, “it may well be unfair to allow them to escape having to account in other States for consequences that arise proximately from such activi ties[.]” Burger King at 474, citing Kulko v. California Superior Court , 436 U.S. 84, 96, 98 S.Ct. 1690, 56 L.Ed.2d 132 (1978). {¶ 44} Finally, the fact that contact may have been “sporadic” is not

determinative. “If it creates a ‘substantial connection’ to th e forum state, a single purposeful contact is enough to satisfy the requirements of due process.” (Citations omitted.) Fallang v. Hickey , 40 Ohio St.3d 106, 108, 532 N.E.2d 117 (1988). In this case, appellants claim injury to corporations located in Ohio, caused by appellees’ actions, and arising from appellees’ contacts with the forum st ate. Accordingly, exercise of personal jurisdiction over appellees is reasonable, and the trial court erred in determining otherwise. We find appellants’ first assignment of error well-taken.23. IV. Conclusion {¶ 45} Having found the exercise of personal jurisdiction over appelle es VelveTop and John B. Walsh proper, we reverse the judgment of the Erie C ounty Common Pleas Court and remand the matter for further proceedings against all defendants. Appellees are ordered to pay the costs of this appeal pursuant to App.R. 24.

Judgment reversed and remanded.

A certified copy of this entry shall constitute the mandate pur suant to App.R. 27. See also 6th Dist.Loc.App.R. 4.

Mark L. Pietrykowski, J. ________________________

_______ JUDGE Thomas J. Osowik, J.

_______________________________ Gene A. Zmuda, P.J. JUDGE CONCUR.

_______________________________ JUDGE

This decision is subject to further editing by the Supreme Cour t of Ohio’s Reporter of Decisions. Parties interested in viewing th e final reported version are advised to visit the Ohio Supreme Court’s web site at: http://www.supremecourt.ohio.gov/ROD/docs/.