Opinion ID: 532440
Heading Depth: 3
Heading Rank: 2

Heading: Breach of Contract and Related Claims

Text: 9 Our analysis differs with respect to the alleged breach of contract and related claims, because events occurred after the first Oklahoma visit which make colorable the exercise of personal jurisdiction over Greene. Specifically, Greene contacted TWC in Montana, presumably to inform TWC of the details involved in securing the letter of commitment. 10 The issue before us is whether the district court correctly exercised specific jurisdiction over Greene. This court applies a three-factor test to determine the propriety of exercising specific jurisdiction. Under the test, the plaintiff must show that (1) the defendant acted such as to purposefully avail himself of the forum's laws; (2) the claim arose out of forum-related activities; and (3) the exercise of jurisdiction was reasonable. Data Disc, 557 F.2d at 1287. If the plaintiff shows that the defendant purposefully directed his activities at the forum, a presumption arises that jurisdiction is reasonable. Haisten v. Grass Valley Medical Reimbursement Fund, Ltd., 784 F.2d 1392, 1397 (9th Cir.1986). Jurisdiction may be proper even upon a lesser showing of forum contacts if the exercise of jurisdiction is reasonable. Id.
11 Greene's contacts with Montana amount to sending a telegram to Montana dated May 18, 1985, and telephoning Montana. Greene did not seek TWC's business in Montana, nor did he advertise there. Greene did not have offices or property in Montana. We cannot say that under these circumstances Greene purposefully availed himself of the benefit of that forum's laws. 12 However, it is beyond dispute that Greene knew he was dealing with a Montana corporation and that the proceeds of the loan would be used for mining investments in Montana. Greene's knowledge may support the exercise of jurisdiction, if Green engaged in forum-related activities and jurisdiction is shown to be reasonable. See Brand, 796 F.2d at 1075.
13 Greene's forum-related activities in Montana were sufficient to support jurisdiction in Montana if the exercise of jurisdiction is shown to be reasonable. Concededly Greene did not physically enter Montana to do business with TWC, and the bulk of Greene's contacts with TWC were telephonic. However, it is not necessary that Greene's activities be physically performed in Montana to make the exercise of jurisdiction proper: 14 [j]urisdiction ... may not be avoided merely because the defendant did not physically enter the forum State.... [i]t is an inescapable fact of modern commercial life that a substantial amount of business is transacted solely by mail and wire.... So long as a commercial actor's efforts are purposefully directed toward residents of another State, we have consistently rejected the notion than an absence of physical presence can defeat personal jurisdiction there. 15 Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476 (1985). Greene knew that it had contracted with a Montana corporation, and that the contract would affect Montana. Thus, the main issue remains whether exercise of jurisdiction under these circumstances was reasonable.
16 This court balances seven factors to determine whether the exercise of jurisdiction is reasonable: (1) the extent of purposeful interjection into the forum state; (2) the burden on the defendant; (3) the conflict with the sovereignty of the defendant's state; (4) the forum state's interest in the suit; (5) the most efficient judicial resolution of the dispute; (6) convenience and effectiveness of relief for the plaintiff; and (7) the existence of an alternative forum. Federal Deposit Ins. Corp. v. British-American Ins. Co., Ltd., 828 F.2d 1439, 1442 (9th Cir.1987). 17 1. Purposeful Interjection. In contract cases, we consider the negotiations and contemplated future consequences of the contract to determine the extent of purposeful interjection. Id. at 1443. Here, the negotiations leading to the contract whereby TWC agreed to part with $16,000 occurred prior to the time that Greene had any contacts with Montana. However, the contemplated future consequences of the contract involved Montana in several ways. It was evident Greene would have to contact TWC in Montana to inform TWC about its progress in securing the letter of commitment and the details of securing the loan. If the loan materialized, its proceeds would be used in Montana. Finally, the contract then envisioned continuous contact between Greene and TWC, presumably in both Oklahoma and Montana, because it obligated TWC to pay Greene 10% of its annual profit. See Appt's brief, exh. 7. 18 We conclude that Greene's purposeful interjection into Montana, while not overwhelming, weighs in favor of exercising jurisdiction. 19 2. The burden on the defendant. Besides contending that he should not have to litigate in Montana, Greene does not make any showing that he would be burdened by having to litigate in Montana. In any event, [i]mprovements in communication and transportation have reduced much of the historical burden of litigating in a distant forum. Decker Coal, 805 F.2d at 841. This factor is therefore not significant. 20 3. The conflict with the sovereignty of the defendant's state. This factor is only relevant when the defendant is from a foreign jurisdiction. Id. 21 4. The forum state's interest in the suit. Since the proceeds of the loan would have been used to operate mines in Montana, this factor is strongly in favor of adjudicating the case in Montana. Montana is interested in protecting mining operations within its borders. 22 5. The most efficient judicial resolution of the dispute. The site where the events in question took place or where most of the evidence is located usually will be the most efficient forum. Brand, 796 F.2d at 1075. Here, negotiations took place over the telephone, simultaneously involving both Montana and Oklahoma. Witnesses would also be located in both states. Evidence of damages would be found mostly in Montana. We conclude this factor is neutral or slightly favoring Montana. 23 6. Convenience and effectiveness of relief for the plaintiff. There is no allegation or reason to think that Montana is a more effective forum than would be Oklahoma. However, it is evident that it would be more convenient for TWC to litigate in Montana. 24 7. The existence of an alternative forum. There is no dispute that Oklahoma is a suitable alternative forum. 25 After considering the above factors separately and as a whole, we affirm the district court's decision that it was reasonable to exercise personal jurisdiction for purposes of the breach of contract and related claims. Greene's interjection into Montana is sufficient to weigh in favor of exercising jurisdiction. Additionally, Montana has a strong interest in protecting mining operations within its borders, and is the most convenient forum for the plaintiff. There is no showing the defendant is burdened by litigating in Montana.