Court Opinion

ID: 8944165
Source: CourtListenerOpinion
Date Created: 2022-11-27 08:14:33.070991+00
Date Added: 2024-06-11T17:09:48.901985
License: Public Domain

BARKER, District Judge,
concurring in part and dissenting in part.
I concur with the majority’s resolution of the “procedural preliminaries” discussed in section II of the majority opinion; however, I respectfully dissent from the reversal of the district court’s dismissal of the claims against Apollo and Red Rocket for lack of personal jurisdiction. I believe that allowing those manufacturers to be sued in Wisconsin violates due process.1
The majority correctly analyzes the due process inquiry as involving a two step process. First, a court must determine whether “the defendant’s conduct and connection with the forum state are such that he should reasonably anticipate being haled into court there.” World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 567, 62 L.Ed.2d 490 (1980). Then, “[o]nce it has been decided that a defendant purposefully established minimum contacts within the forum state, these contacts may be considered in light of other factors to determine whether the assertion of personal jurisdiction would comport with ‘fair play and substantial justice.’ ” Burger King Corp. v. Rudzewicz, — U.S. -, 105 S.Ct. 2174, 2184, 85 L.Ed.2d 528 (1985), citing International Shoe Co. v. Washington, 326 U.S. 310, 320, 66 S.Ct. 154, 160, 90 L.Ed. 95 (1945). Because I believe that Apollo and Red Rocket could not reasonably have anticipated being sued in Wisconsin and could never reasonably be found to have “purposefully established minimum contacts” in Wisconsin and because I believe that the assertion of personal jurisdiction on the present facts is an unnecessary, unwarranted, and undesirable extension of the jurisdiction of the district court, I would affirm the district court’s decision to dismiss the action against both defendants.
In determining whether Apollo and Red Rocket are connected with Wisconsin in such a way that they should reasonably anticipate being haled into court there, it is helpful to consider the guidance recently given by the Supreme Court on the subject of “purposeful availment.” In Burger King Corp. v. Rudzewicz, 471 U.S. 462, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985), the plaintiff brought an action alleging that the defendant had breached his franchise obligations by failing to make the required payments at the plaintiff’s place of business in Miami, Florida. The defendant, a Michigan citizen and resident, had never been physically present in Florida. However, he had purchased equipment from plaintiff in Florida; he had negotiated the terms of the franchise with plaintiff’s Florida office; and, following default, he had engaged in prolonged negotiations by mail and telephone with plaintiff’s Florida office.
The Supreme Court first explained that the
“purposeful availment” requirement ensures that a defendant will not be haled into a jurisdiction solely as a result of “random,” “fortuitous,” or “attenuated” contacts, or of the “unilateral activity of another party or a third person.” Jurisdiction is proper, however, where the contacts proximately result from actions by the defendant himself that create a “substantial connection” with the forum state. Thus where the defendant “deliberately” has engaged in significant activities within a state, or has created “continuing obligations” between himself and residents of the forum, he manifestly has availed himself of the privilege of conducting business there, and because his activities are shielded by “the benefits and protections” of the forum’s laws it is presumptively not unreasonable to require him to submit to the burdens of litigation in that forum as well.
*670Id. 105 S.Ct. at 2183-84 (citations omitted). Then, noting the defendant’s deliberate efforts to reach out beyond Michigan to negotiate with a Florida corporation for the purchase of a long-term franchise and his acceptance of a 20-year relationship that envisioned continuing and wide-reaching contacts with plaintiff in Florida, the Court concluded that the defendant’s contacts could not be viewed as “random,” “fortuitous,” or “attenuated.” The Court further concluded that the defendant’s failure to make the required payments to Miami caused foreseeable injuries there. As such, it was reasonable for the defendant to expect to be sued in Florida.
Though Burger King involved a determination of the limits of personal jurisdiction over a nonresident defendant who had allegedly breached a contract, the Supreme Court’s general explication of the “purposeful availment” requirement is equally applicable to suits in which plaintiffs assert other theories. Several of the cases cited by the Court in support of its explication involved noncontractual claims. See, e.g., World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980) (torts); Kulko v. California Superior Court, 436 U.S. 84, 98 S.Ct. 1690, 56 L.Ed.2d 132 (1978) (domestic relations).
In the present case, the contacts between Wisconsin and the alleged tortfeasors, Apollo and Red Rocket, clearly do not suggest the requisite purposeful availment necessary to satisfy due process.
Assuming as we do that both Apollo and Red Rocket supplied the fireworks to Capitol that caused the injuries to Giotis in Wisconsin, the fact that the fireworks were in Wisconsin at all was the result of the unilateral activity of a third person, namely, Malcolm Gillespie, Jr. in taking the fireworks there. Neither Apollo nor Red Rocket distributed fireworks in Wisconsin. In addition, there is no evidence in the record that Capitol distributed fireworks in Wisconsin. In fact, no sale at all occurred in Wisconsin. Capitol’s nationwide advertising, which was the defendants’ only possible “purposeful” contact with Wisconsin does not, in itself, constitute an action by the defendant capable of being construed as a contact which “create[s] a ‘substantial connection’ with the forum state.” See Burger King, 105 S.Ct. at 2184.
It was Gillespie’s decision to transport and act of transporting the fireworks to a party in Wisconsin that resulted in there being a connection between the defendants and Wisconsin. Apollo and Red Rocket did not deliberately engage in any significant activities in Wisconsin. Neither by their express intentions nor through their acts have Apollo and Red Rocket created any “continuing obligations” between themselves and Wisconsin residents. All that can be established is that they deliberately chose to sell fireworks to a distributor in Illinois who advertises nationwide. Apollo and Red Rocket have done nothing to avail themselves of the privilege of conducting business in Wisconsin, they have had no contacts other than those random and fortuitous contacts created by Malcolm Gillespie, and they had no reason to anticipate being haled into court there. In my opinion due process dictates that they should not be haled into court there.
In support of its contrary conclusion that the due process clause is not violated by allowing Apollo and Red Rocket to be sued in Wisconsin, the majority relies heavily upon a comparison of the facts in this case to a modified version of the facts in World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980). In attempting to determine if World-Wide Volkswagen controls the outcome of this case, the majority creates a factual scenario in which the plaintiff bought his car in Atlantic City, New Jersey, was injured in West Hartford, Connecticut, and sued a regional distributor of that car in Connecticut, suggesting that those circumstances would most clearly resemble the facts in the present case and concluding under those facts and due process standards, that the suit could properly be brought in Connecticut.
At the risk of over-extending the majority’s analysis, let me offer what I believe to *671be a more accurate modification of the World-Wide Volkswagen facts as applied to this case. Assume a person purchased from a New Jersey distributor a car which had been manufactured in Michigan. From there, the purchaser drove the car to his friend’s house in Connecticut. While the purchaser was driving the car in Connecticut, it malfunctioned and injured the friend. The friend then filed a suit in Connecticut against the Michigan manufacturer. This scenario, I believe, more closely resembles the present case for the reason that in this scenario, as in the instant case, the plaintiff was not the purchaser of the allegedly defective product and the defendant was not the distributor, but was instead the manufacturer of the product.
From this set of facts, it is apparent that, pursuant to World-Wide Volkswagen, a court in Connecticut would not have personal jurisdiction over the defendant. The manufacturer of the product cannot be deemed to have purposefully positioned itself in a state where an injury occurs when that state where the injury occurs is other than the place where the product was purchased, and the injury is suffered by a friend of the actual purchaser of a product. An injury under these circumstances does not give rise to sufficient contacts by the alleged tortfeasor with the place of the injury to permit personal jurisdiction over him. In fact, it is difficult to imagine contacts which could be more random and fortuitous than the defendants’ contacts with Wisconsin which occurred only as a result of the independent decision of Gillespie to transport the fireworks into Wisconsin. The manufacturers and distributors of the fireworks did not encourage or solicit that decision by Gillespie, they did not participate in that decision, nor did they derive any economic benefit from that decision. It was a decision made entirely of Gillespie’s own volition. Yet, the majority holds that Apollo and Red Rocket can be sued in such a place and that their constitutional entitlement to due process is not violated or otherwise compromised by requiring them to defend in a forum over which they had virtually no say-so or choice.
I believe the court’s holding today will effectively abolish any due process restrictions on personal jurisdiction over manufacturers and distributors of moveable products. Indeed, the holding suggests that, because manufacturers and primary distributors are at the head of the distribution system, they should reasonably expect to be sued in any jurisdiction into which a purchaser may transport their product.
The majority has cited a case, decided by another panel of this court, which addresses personal jurisdiction in the context of a moveable product. See Nelson v. Park Indus., Inc., 717 F.2d 1120, 1125 (7th Cir.1983), cert. denied, 465 U.S. 1024, 104 S.Ct. 1278, 79 L.Ed.2d 682 (1984). In Nelson, plaintiff, who was a minor, sought recovery for burns sustained when the shirt she was wearing ignited after contact with a cigarette lighter flame. The shirt was manufactured in Hong Kong, purchased by a purchasing agent in Hong Kong on behalf of the retail seller, and sold at the retailer’s store in Wisconsin. The district court granted the manufacturer’s and the purchasing agent’s motions to dismiss for lack of personal jurisdiction. This court reversed. Although the case supports a conclusion that sellers at the head of a distribution network may more easily satisfy the “purposeful availment” test, it is distinguishable on its facts from the present case, as explained below, and does not compel us to conclude that personal jurisdiction exists here.
In Nelson, following the general holding that the relevant scope of the foreseeable market served by manufacturers and primary distributors is often broader for them than it is for sellers further down the stream of commerce, the panel recognized that the crucial inquiry remained: whether under that distribution system it could be said that the movants’ conduct and their connection with Wisconsin were such that they should reasonably have anticipated being haled into court there. In its analysis, the court focused primarily on whether the movants were aware that they were indirectly serving and deriving economic bene*672fits from the national retail market established by the retailer. After finding sufficient evidence in the record to establish such knowledge, the court concluded that, on that basis, the movants should have reasonably anticipated being haled into court in a forum where the distribution system brought a shirt that allegedly caused injury.
The Nelson court’s ability to find evidence of the defendants’ knowledge of the distribution scheme distinguishes it from the facts of the present case. In the case at bar, there is no evidence in the record that the defendants were aware of the scope of Capitol’s sales efforts, and it is my view that without such evidence, Apollo and Red Rocket should not be held to answer in a suit that was filed in a forum into which their product was randomly or fortuitously transported.
Recognizing the significance of the defendants’ knowledge of the distribution scheme as a factor in determining whether the defendants should reasonably anticipate a lawsuit in a given forum, the majority opinion holds: “[T]here is no evidence that the. defendants were unaware of [the] scope of Capitol’s sales efforts, and in fact Red Rocket admits that the distributors to whom it sold had the capability of distributing the fireworks into any other number of states.” However, in reaching this conclusion, the majority erroneously shifts the burden of establishing jurisdiction to the defendants, requiring them to prove their state of knowledge concerning the scope of Capitol’s sales efforts at the time of the alleged injury.
A plaintiff has the burden of establishing jurisdiction. O’Hare Int’l Bank v. Hampton, 437 F.2d 1173, 1176 (7th Cir.1971). Since there is no evidence that the defendants were aware or unaware of the scope of Capitol’s sales efforts, the only legitimate inference we should fairly draw is that there is no factual basis to extend jurisdiction over the defendants.
Finally, Red Rocket’s admission regarding its customers’ distribution capability is, at best, ambiguous, since many distributors are capable of selling products in any state, yet choose to sell only in specified regions. Therefore, I am unwilling to conclude that the “admission” is sufficient evidence of Red Rocket’s knowledge of Capitol’s distribution territory such that Red Rocket should be subject to a lawsuit in any state within that territory. In any event, the admission cannot be attributed to Apollo; therefore, no evidence exists in the record regarding Apollo’s knowledge.
For all of the foregoing reasons, I respectfully dissent from section IV of the majority opinion and would affirm the district court’s dismissal.

. At the outset, I must note that I am not entirely convinced that the facts in this case support a conclusion that the requirements of the Wisconsin long-arm stautte are satisfied. There is, minimally, a substantial question as to whether the fireworks were used or consumed within Wisconsin "in the ordinary course of trade." However, because I believe that holding Apollo and Red Rocket to answer this lawsuit in Wisconsin clearly violates due process, I accept the district judge’s view that jurisdiction in all likelihood exists under the Wisconsin statute.