Court Opinion

ID: 9348064
Source: CourtListenerOpinion
Date Created: 2022-12-19 22:08:01.665634+00
Date Added: 2024-06-11T16:42:10.257596
License: Public Domain

IN THE SUPREME COURT OF NORTH CAROLINA

                                        2022-NCSC-81

                                          No. 181A21

                                      Filed 17 June 2022

     TOSHIBA GLOBAL COMMERCE SOLUTIONS, INC.

                   v.
     SMART & FINAL STORES LLC

           Appeal pursuant to N.C.G.S. § 7A-27(a)(3) from an order and opinion denying

     defendant’s motion to dismiss for lack of personal jurisdiction entered on

     23 December 2020 by Judge Adam M. Conrad, Special Superior Court Judge for

     Complex Business Cases, in Superior Court, Durham County, after the case was

     designated a mandatory complex business case by the Chief Justice pursuant to

     N.C.G.S. § 7A-45.4(a). Heard in the Supreme Court on 21 March 2022.

           Robinson, Bradshaw & Hinson, P.A., by Erik R. Zimmerman, Edward F.
           Hennessey IV, Matthew W. Sawchak, and Benjamin C. DeCelle; and Kenneth
           B. Hammer, for plaintiff-appellee.

           Ellis & Winters LLP, by Paul K. Sun Jr. and Kelly Margolis Dagger, for
           defendant-appellant.

           BARRINGER, Justice.

¶1         In this matter, we must consider whether the trial court erred by denying a

     nonresident defendant’s motion to dismiss for lack of personal jurisdiction. Plaintiff

     Toshiba Global Commerce Solutions, Inc. (Toshiba) is based in Durham, North

     Carolina, and brought this action against Smart & Final Stores LLC (Smart & Final)
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     for breach of contract and related claims. Smart & Final, a California company that

     operated warehouse-style grocery stores in the western United States, contacted

     Toshiba during its search for a service provider to maintain and repair the point-of-

     sale equipment that Smart & Final uses at its stores. In March 2019, negotiations

     between the parties resulted in the Master Maintenance Services Agreement

     (Services Agreement), in which Toshiba agreed to provide maintenance and repair

     services for point-of-sale equipment at all Smart & Final stores for three years.

     According to the complaint, Smart & Final refused to pay overage fees as required by

     the Services Agreement and terminated the Services Agreement without cause in

     April 2020. As addressed in more detail herein, on the record before us and claims

     alleged, the Due Process Clause of the Fourteenth Amendment does not preclude the

     courts of this State from entering a judgment binding on Smart & Final. Therefore,

     we conclude that the trial court did not err by denying Smart & Final’s motion to

     dismiss for lack of personal jurisdiction.

                                 I.   Personal Jurisdiction

¶2         “The Fourteenth Amendment’s Due Process Clause limits a state court’s power

     to exercise jurisdiction over a defendant.” Ford Motor Co. v. Mont. Eighth Jud. Dist.

     Ct., 141 S. Ct. 1017, 1024 (2021). Specifically, “[t]he Due Process Clause protects an

     individual’s liberty interest in not being subject to the binding judgments of a forum
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     with which he has established no meaningful contacts, ties, or relations.” Burger King

     Corp. v. Rudzewicz, 471 U.S. 462, 471–72 (1985) (cleaned up).

¶3         As articulated in International Shoe Co. v. Washington, 326 U.S. 310 (1945), a

     defendant who is not subject to general jurisdiction in a forum state or present in the

     forum state must “have certain minimum contacts with [the forum state] such that

     the maintenance of the suit does not offend traditional notions of fair play and

     substantial justice.” Id. at 316 (cleaned up). This jurisdiction—known as specific

     jurisdiction—“exists when the cause of action arises from or is related to defendant’s

     contacts with the forum.” Skinner v. Preferred Credit, 361 N.C. 114, 122 (2006). The

     relationship with the forum “must arise out of contacts that the ‘defendant himself”

     creates with the forum [s]tate.” Walden v. Fiore, 571 U.S. 277, 284 (2014) (quoting

     Burger King, 471 U.S. at 475). While the quality and nature of defendant’s activity

     with the forum state may vary, “it is essential in each case that there be some act by

     which the defendant purposefully avails itself of the privilege of conducting activities

     within the forum [s]tate, thus invoking the benefits and protections of its laws.”

     Hanson v. Denckla, 357 U.S. 235, 253 (1958). Thus, consistent with the foregoing, the

     Supreme Court of the United States has recognized that jurisdiction exists without

     offending the Due Process Clause when “the suit was based on a contract which had

     substantial connection with that [s]tate.” McGee v. Int’l Life Ins. Co., 355 U.S. 220,

     223 (1957).
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                                       II.     Analysis

¶4         Toshiba initiated this action against Smart & Final in Superior Court, Durham

     County, North Carolina, alleging breach of the Services Agreement and related

     claims. Smart & Final moved to dismiss the complaint for lack of personal jurisdiction

     pursuant to Rule 12(b)(2) of the North Carolina Rules of Civil Procedure. Both parties

     submitted affidavits and exhibits in support of and opposition to Smart & Final’s

     motion, and a hearing was held, but testimony was not taken at the hearing.

¶5         In this context, when the parties have submitted affidavits and exhibits but no

     evidentiary hearing is held, the trial court must determine the weight and sufficiency

     of the evidence before it. See N.C.G.S. § 1A-1, Rule 43(e) (2021); Banc of Am. Sec. LLC

     v. Evergreen Int’l Aviation, Inc., 169 N.C. App. 690, 694 (2005). However, pursuant to

     Rule 52(a)(2) of the North Carolina Rules of Civil Procedure, the trial court need not

     make specific findings of fact in support of its order unless requested by a party.

     N.C.G.S. § 1A-1, Rule 52(a)(2) (2021). If in deciding the motion the trial court makes

     findings of fact, they are conclusive on appeal when unchallenged or supported by

     competent evidence even when there is a conflict in the evidence. See, e.g., Morse v.

     Curtis, 276 N.C. 371, 378 (1970) (“We recognize the often-repeated rule that findings

     of fact by a trial judge are conclusive when supported by competent evidence, even

     when there is [a] conflict in the evidence, but an exception to a finding of fact not

     supported by competent evidence must be sustained.”); Fungaroli v. Fungaroli, 51
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     N.C. App. 363, 367 (1981) (applying this rule to the Court of Appeals’ review of a trial

     court’s order denying a motion to dismiss for lack of personal jurisdiction).

¶6          In this matter, the trial court found facts and ultimately determined that the

     Services Agreement had “a substantial connection with North Carolina.”1 Although

     Smart & Final makes arguments concerning the competency of evidence supporting

     some portions of the trial court’s findings, Smart & Final has not challenged the

     following findings of fact2:

                         4. Based in Durham, North Carolina, Toshiba
                   makes and sells point-of-sale products used by retailers—
                   for example, scanners, monitors, and related checkout
                   devices. It also offers support services for its products and
                   those made by others.

                          5. Smart & Final is a California company that
                   operates a chain of warehouse-style grocery stores in the
                   western United States. Until recently, one of its
                   subsidiaries operated restaurant supply and wholesale
                   food stores in the same region.

                         6. In late 2017, Smart & Final began searching for
                   a service provider to maintain and repair point-of-sale
                   equipment at its stores. One of the vendors it contacted was
                   Toshiba. The parties promptly signed a nondisclosure

            1  Since Smart & Final does not advance an argument on appeal concerning North
     Carolina’s long-arm statute, N.C.G.S. § 1-75.4 (2021), we do not address the long-arm statute
     herein.
             2 The trial court listed some of the following findings of fact under the subheading

     “Conclusions of Law.” However, this Court can and should disregard the trial court’s labels
     when necessary to apply the appropriate standard of review. In re M.C., 374 N.C. 882, 890
     (2020). Therefore, to properly review the issue before us, we have listed the trial court’s
     unchallenged findings of fact even if they appear in the paragraphs following the subheading
     “Conclusions of Law.” Further, for readability, the trial court’s citations to the record and
     caselaw have been omitted.
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                      Opinion of the Court

 agreement, notable only because it lists Toshiba’s North
 Carolina address at the top. Over the next few months,
 Toshiba sent pitch materials and a formal proposal for a
 mix of products and services. Toshiba touted its technology
 (hardware and software), national presence (a fleet of
 technician vans coupled with a network of stocking
 locations to house inventory), and support infrastructure (a
 central repair depot and an “expert staff of trained
 personnel . . . at our corporate HQ” in North Carolina).
 Ultimately, though, Smart & Final went with a different
 vendor.

        7. Evidently, that relationship didn’t work out, and
 soon Smart & Final was looking for a new vendor. It
 reached out to Toshiba a second time and requested
 another proposal. Most of the negotiations took place via e-
 mail and telephone between Smart & Final representatives
 in California and Toshiba representatives in California and
 Texas. There was also at least one in-person meeting at
 Smart & Final’s California headquarters.

        8. This time, the negotiations were fruitful,
 producing a services agreement in March 2019. In a
 nutshell, Toshiba agreed to provide maintenance and
 repair services for point-of-sale equipment at all Smart &
 Final stores for three years. Smart & Final could renew the
 agreement for additional one-year terms with written
 notice to Toshiba’s North Carolina headquarters. A choice-
 of-law provision states that New York law governs the
 agreement.

        9. Smart & Final selected two service options: “On-
 Site Repair” and “Advanced Exchange Plus.” On-Site
 Repair means just what it says: a Toshiba technician would
 travel to a given store and try to repair defective equipment
 on site. Advanced Exchange Plus, on the other hand, is a
 replacement service. This option calls for the technician to
 replace the defective part with a working unit taken from
 inventory called seed stock. Although Smart & Final could
 have chosen to own and maintain the seed stock itself, it
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 shifted that burden to Toshiba. Toshiba also took
 responsibility for installing replacement parts and for “the
 return of the [defective] Product back to [its] depot.”

        10. Both service options are geared toward
 addressing problems as they arise. Determined “to operate
 [its] stores without interruption,” Smart & Final put a
 premium on speed. The agreement specifies response times
 and performance goals typically based on same-day or
 next-day service. Along with making its technicians
 available seven days a week, Toshiba agreed to “provide an
 infrastructure and support structure to meet” its
 obligations.

        11. These requirements are reflected in the price.
 Attachment A details the prices for repair and replacement
 services for dozens of products, based in part on estimates
 of the amount of seed stock needed, the expected response
 time, and the number of anticipated service calls. It also
 states various pricing assumptions, including that Toshiba
 would own the seed stock and “image/configure units
 during the receive and repair process at our Depot.” For the
 Advanced Exchange Plus option, the price sheet assumes
 that a “technician will meet [the] part on-site that is
 shipped from the Toshiba depot,” noting that the
 replacement “part for [a] failed unit [would be] available
 under Next Business Day support.”

        12. Although the agreement doesn’t say so, the
 “depot” is part of Toshiba’s “Tricenter operations hub” in
 North Carolina. This is where Toshiba managed the seed
 stock and repaired failed equipment throughout its
 relationship with Smart & Final. Before the “go live date”
 for the services agreement, employees at the depot
 estimated the seed stock needed to get started, procured it
 (because Smart & Final used non-Toshiba equipment), and
 then shipped it to field technicians and stocking locations.
 As time went by, the depot received and repaired
 equipment that technicians could not fix on site. The depot
 then returned these repaired items to the seed stock or, if
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 a part was beyond repair, replenished the stock with new
 equipment.

       13. Over the course of their relationship, Toshiba
 handled about 7,200 repair tickets for Smart & Final. Some
 involved purely on-site repairs. Many others required
 support from Toshiba’s depot in North Carolina. The depot
 recorded more than 4,200 shipments of parts to replenish
 inventory and more than 2,600 repairs for parts removed
 from Smart & Final stores—about seven percent of the
 repairs and replenishments performed for all Toshiba
 customers.

       14. Less than a year into their relationship, the
 parties split. Toshiba alleges that the equipment covered
 by the agreement failed at rates far higher than Smart &
 Final predicted during negotiations, triggering hefty
 overage fees. As alleged, Smart & Final refused to pay and
 then terminated the agreement without cause in April
 2020, more than two years before its scheduled expiration.
 Toshiba sued for breach of contract and related claims.

       ....

        26. . . . Smart & Final initiated contact with a
 resident of this State and created a continuing relationship
 involving services that were performed both within and
 outside North Carolina.

       ....

        29. Smart & Final was well aware when it contacted
 representatives of Toshiba that it was soliciting business
 from a North Carolina-based entity. The nondisclosure
 agreement that preceded negotiations has Toshiba’s
 address right at the top. . . . [T]he services agreement . . .
 requires all notices to go to Toshiba’s Durham
 headquarters. Furthermore, . . . Smart & Final is a large,
 sophisticated company deeply familiar with the market for
 point-of-sale products and services. At no point has Smart
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                 & Final claimed surprise to find that Toshiba is based in
                 North Carolina.

                       ....

                        31. . . . In less than a year, Toshiba recorded
                 thousands of shipments from its North Carolina base to
                 maintain seed stock and replenish inventory, along with
                 more than 2,600 repairs of parts taken from Smart & Final
                 stores. This was not only a substantial part of the services
                 performed for Smart & Final but also an appreciable part
                 of the repair and replenishment services that Toshiba
                 performed as a whole.

                        32. . . . Smart & Final had the option to keep its
                 seed stock in house so that Toshiba would be responsible
                 only for labor at affected stores. Instead, Smart & Final put
                 the burden on Toshiba to create and maintain the seed
                 stock and to provide the infrastructure needed for same-
                 day and next-day services. . . .

                       33. . . . [I]t is undisputed that Smart & Final did not
                 come to North Carolina or perform any services here.

                       ....

                       35. . . . Toshiba actually performed a substantial
                 portion of its [contractual] obligations in the State. . . .

                       36. Finally, in some rare cases, it may be
                 unreasonable or inconvenient to exercise jurisdiction even
                 when the defendant has the requisite minimum contacts
                 with the forum. Smart & Final has not made that
                 argument here.

¶7         Since these binding findings of fact are sufficient to support personal

     jurisdiction over Smart & Final under this Court’s and the Supreme Court of the

     United States’ precedent for the reasons addressed herein, we need not address
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     Smart & Final’s challenges to any other findings of fact or the arguments concerning

     the disputed findings of fact.

¶8         Further, we do not find the standard of review determinative in this matter.

     This Court has implicitly endorsed that whether personal jurisdiction exists is a

     question of fact and that appellate courts do not review de novo a trial court’s

     determination of personal jurisdiction but assess whether the determination is

     supported by competent evidence in the record. Ponder v. Been, 275 N.C. App. 626,

     636–37 (2020) (Stroud, J., dissenting), rev’d per curiam for reasons stated in the

     dissent, 380 N.C. 570, 2022-NCSC-24; Eluhu v. Rosenhaus, 159 N.C. App. 355, 357

     (2003), aff’d per curiam, 358 N.C. 372 (2004). “However, when the pertinent inquiry

     on appeal is based on a question of law[,] . . . we conduct de novo review.” Da Silva v.

     WakeMed, 375 N.C. 1, 5 (2020). Whether reviewing the finding of personal

     jurisdiction for competent evidence or de novo, we hold that the trial court did not err

     by denying the motion to dismiss for lack of personal jurisdiction because the Services

     Agreement had a substantial connection with this State.

¶9         The Supreme Court of the United States recognized over half a century ago

     that the Due Process Clause does not preclude a state court from entering a judgment

     binding on a contracting party when “the suit was based on a contract which had

     substantial connection with that [s]tate.” McGee, 355 U.S. at 223. McGee addressed

     a state’s personal jurisdiction over a nonresident life insurance company. Id. at 221.
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       The nonresident life insurance company had no offices or agents in the forum state

       and “ha[d] never solicited or done any insurance business in [the forum state] apart

       from the policy involved [in the case].” Id. at 222. The Court concluded that the forum

       state had jurisdiction over the nonresident life insurance company because the

       contract had a substantial connection with the forum state. Id. at 223. “The contract

       was delivered in [the forum state], the premiums were mailed from there and the

       insured was a resident of that [s]tate when he died.” Id.

¶ 10         A few decades later, the Supreme Court of the United States in Burger King

       revisited personal jurisdiction in the context of a contractual dispute. 471 U.S. at 463–

       64. The Court explained that there is no mechanical test for determining jurisdiction

       between contracting parties; it does not turn on “the place of contracting or of

       performance,” id. at 478 (quoting Hoopeston Canning Co. v. Cullen, 318 U.S. 313, 316

       (1943)), and “an individual’s contract with an out-of-state party alone can[not]

       automatically establish sufficient minimum contacts in the other party’s home

       forum,” id. at 478. Instead, “prior negotiations and contemplated future

       consequences, along with the terms of the contract and the parties’ actual course of

       dealing [are the factors] that must be evaluated in determining whether the

       defendant purposefully established minimum contacts within the forum.” Id. at 479.

¶ 11         After analyzing the facts relating to these factors, the Supreme Court of the

       United States in Burger King concluded that there was substantial record evidence
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       supporting the trial court’s determination “that the assertion of personal jurisdiction

       over [the nonresident individual in the forum state] for the alleged breach of his

       franchise agreement did not offend due process.” Id. at 478. Notably, the nonresident

       individual had “no physical ties” to the forum state; he had never visited and did not

       maintain offices in the forum state. Id. at 479. However, “th[e] franchise dispute grew

       directly out of ‘a contract which had a substantial connection with that [s]tate.’ ” Id.

       (quoting McGee, 355 U.S. at 223).

¶ 12         While this case differs in some respects from Burger King, our analysis of the

       facts before us, as informed by applicable precedent, leads us to conclude that the

       assertion of personal jurisdiction over Smart & Final for the alleged breach of the

       Services Agreement and related claims does not offend due process. Specifically, as

       discussed below, the undisputed facts concerning the “contemplated future

       consequences,” “terms of the contract,” and “actual course of dealing” all support a

       determination that the Services Agreement is a contract with a substantial

       connection with the State of North Carolina.

¶ 13         First, Smart & Final intentionally solicited a company that it knew to be based

       in North Carolina and sought a service provider to maintain and repair point-of-sale

       equipment through that solicitation. Between late 2017 and early 2019, this

       solicitation occurred twice. This is substantively analogous to Burger King where the

       defendant challenging jurisdiction negotiated with an out-of-state corporation and
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       such negotiations were not for a one-off transaction but for a “long-term franchise.”

       Id. at 479. The Burger King defendant “[e]schew[ed] the option of operating an

       independent local enterprise” and pursued a contract with “the manifold benefits that

       would derive from affiliation with a nationwide organization.” Id. at 479–80. While

       the relationship between the parties in this case is not of franchisor and franchisee

       as in Burger King, Smart & Final contacted a company based in North Carolina to

       provide ongoing services in lieu of servicing its point-of-sale equipment itself. The

       sought relationship, thus, was not a one-off transaction, such as a one-time purchase

       of goods, but a contractual relationship sought by Smart & Final knowing that

       Toshiba was based in North Carolina.

¶ 14         Second, Smart & Final and Toshiba did enter into a contract, the Services

       Agreement, in March 2019. In that contract, Toshiba agreed to provide maintenance

       and repair services for point-of-sale equipment at all Smart & Final stores for three

       years. Smart & Final could also renew the Services Agreement for additional one-

       year terms by sending a written notice to Toshiba’s North Carolina headquarters.

       Thus, the contract and relationship formed because of Smart & Final’s solicitation of

       a company based in North Carolina was not a one-off transaction but one involving

       ongoing services for at least three years. While the Services Agreement does not

       contemplate a twenty-year relationship like in Burger King, it nevertheless
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       established a substantial relationship that was contemplated to potentially extend

       beyond three years.

¶ 15         Third, pursuant to the Services Agreement, Toshiba took responsibility for

       installing replacement parts on-site from inventory shipped from the Toshiba depot

       and for returning defective equipment back to Toshiba’s depot. During the course of

       the parties’ relationship, the depot was located in North Carolina and was where

       Toshiba managed and repaired the inventory. Employees at the depot in North

       Carolina estimated the inventory needed to fulfill its responsibilities under the

       Services Agreement, procured it, and shipped it to field technicians and stocking

       locations. Thereafter, the depot in North Carolina received and repaired defective

       equipment that could not be fixed on-site and returned the repaired (or new)

       equipment to field technicians and stocking locations. The depot in North Carolina

       recorded “more than 4,200 shipments of parts to replenish inventory” and “more than

       2,600 repairs for parts removed from Smart & Final stores.”

¶ 16         Fourth, the Services Agreement required that any written notice required

       under the Services Agreement be directed to Toshiba’s office in North Carolina. As

       summarized by Smart & Final in its brief, Smart & Final “gave notice, addressed to

       Toshiba’s Durham office, that it was exercising its contractual right to terminate the

       [Services] Agreement” on 1 April 2020. One month later, Toshiba sued for
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       nonpayment and contended that Smart & Final breached the Services Agreement “by

       terminating [it] without a contractual basis to do so.”

¶ 17         Given the foregoing facts, the “contemplated future consequences” as reflected

       in “the terms of the contract” involved Toshiba maintaining a depot to meet its

       contractual obligations. Burger King, 471 U.S. at 479. Furthermore, “the parties’

       actual course of dealing” showed that Toshiba used a depot in North Carolina to meet

       its contractual obligations by performing a substantial number of repairs at and

       shipments from the depot. Id. On average, there were over seven repairs a day at the

       depot in North Carolina and over eleven shipments a day from the depot in North

       Carolina. The “terms of the contract” also dictated that any written notice required

       by the Services Agreement be sent to Toshiba’s office in North Carolina, and “the

       parties’ actual course of dealing” showed that Smart & Final sent written notice to

       Toshiba in North Carolina to terminate the Services Agreement. These undisputed

       facts concerning the “contemplated future consequences,” “terms of the contract,” and

       “actual course of dealing” all support a determination that the Services Agreement is

       a contract with a substantial connection with the State of North Carolina.

¶ 18         Nevertheless, Smart & Final argues that “[t]he only link between this case and

       North Carolina is that [Smart & Final] contracted with Toshiba, which has its

       corporate headquarters in North Carolina.” According to Smart & Final, Smart &

       Final’s solicitation of a North Carolina-based company does not show purposeful
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       availment because Smart & Final did not reach into North Carolina by sending an

       agent physically to North Carolina or by physically sending e-mails or letters to North

       Carolina. In Smart & Final’s view, it merely directed contact to Toshiba, not North

       Carolina. Smart & Final also contends that because the Services Agreement did not

       require performance within North Carolina, Toshiba’s conduct in North Carolina to

       fulfill its contractual obligations under the Services Agreement are unilateral acts

       and not evidence of Smart & Final’s purposeful availment of the North Carolina

       forum.

¶ 19         The contractual negotiations between Smart & Final and Toshiba did occur

       outside of North Carolina, and Smart & Final did not come to or perform any services

       in North Carolina. Thus, Smart & Final is correct that this case does not involve

       contacts with North Carolina from Smart & Final’s agents being physically present

       in North Carolina. Nevertheless, “physical presence in [North Carolina] is not a

       prerequisite to jurisdiction.” Walden, 571 U.S. at 285. The defendants in both Burger

       King and McGee had no physical presence in the forum state. Burger King, 471 U.S.

       at 479; McGee, 355 U.S. at 222.

¶ 20         Additionally, the fact that contract negotiations and formation occurred

       outside North Carolina does not foreclose jurisdiction in this case. In Burger King,

       the defendant applied to Burger King’s Birmingham, Michigan, district office for a

       franchise, dealt with this office daily, and ultimately executed a final agreement with
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       Burger King after negotiating with the district office and Burger King’s headquarters

       in Florida. 471 U.S. at 466–67, 467 n.7. The Supreme Court of the United States

       rejected the Court of Appeals reasoning that given the supervision and involvement

       of the district office, the defendant reasonably believed that the Michigan office was

       “the embodiment of Burger King,” and “he therefore had no reason to anticipate a

       Burger King suit outside of Michigan.” Id. at 480 (cleaned up). Instead, the Supreme

       Court concluded that there was “substantial record evidence indicating that [the

       defendant] most certainly knew that he was affiliating himself with an enterprise

       based primarily in Florida,” id. at 480, and determined that the assertion of personal

       jurisdiction over the defendant in Florida “did not offend due process,” id. at 478.

¶ 21         In this matter, it is undisputed that Smart & Final solicited Toshiba agents

       outside of North Carolina and knew at the time that Toshiba was based in North

       Carolina. Like the Supreme Court of the United States, we therefore cannot dismiss

       Smart & Final’s solicitation of Toshiba as irrelevant. Knowingly soliciting an entity

       based in North Carolina for a multiyear contractual relationship is relevant to

       whether a contract has a substantial connection with North Carolina. See Mucha v.

       Wagner, 378 N.C. 167, 2021-NCSC-82, ¶ 11 (“In prior cases where this Court has

       found a defendant’s one-time contacts sufficient to create specific personal

       jurisdiction in North Carolina, the defendant knew or reasonably should have known
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       that by undertaking some action, the defendant was establishing a connection with

       the State of North Carolina.”).

¶ 22         Also, nothing in McGee, Burger King, or this Court’s decision applying Burger

       King in Tom Togs, Inc. v. Ben Elias Industries Corp., 318 N.C. 361 (1986), suggests

       that unless the location of the act is dictated by the contract, performance of a

       contractual obligation in the forum state is an irrelevant unilateral act. In McGee,

       the Supreme Court of the United States in its analysis identified three facts

       supporting its determination that the suit involved a contract with a substantial

       connection to the forum. 355 U.S. at 223. One fact was that “the premiums were

       mailed from [the forum state].” Id. In assessing the personal jurisdiction of the forum

       state concerning a breach of a life insurance contract, McGee did not mention that the

       contract required the insured to mail premium payments from the forum state. Thus,

       McGee lends no support to defendant’s contention that the contract must require

       performance in the forum state. Instead, McGee supports the notion that regular

       contractual performance of a contractual obligation, like premium payments, in the

       forum is relevant even if the location of the performance is not dictated by the

       contract.

¶ 23         In Burger King, the Supreme Court of the United States, when assessing

       whether there was record evidence to support that the defendant knew he was

       affiliating with an entity from the forum state, recognized that the contract
                  TOSHIBA GLOB. COM. SOLS., INC. V. SMART & FINAL STORES LLC

                                              2022-NCSC-81

                                           Opinion of the Court

       documents did “emphasize that Burger King’s operations are conducted and

       supervised from the [forum state] headquarters.” 471 U.S. at 480 (emphasis added).

       However, the contract in Burger King did not require Burger King to conduct

       operations from and supervise from its headquarters in the forum state. See id. at

       488 (Stevens, J., dissenting) (identifying that the contract “required no performance

       in the state of Florida” and held the district office “responsible for providing all of the

       services due [defendant]”). Similarly, in Tom Togs, the nonresident defendant was

       “aware that the contract was going to be substantially performed in [the forum

       state],” but the Court’s opinion never indicates that performance was required to be

       in the forum state. 318 N.C. at 367.

¶ 24         Finally, Smart & Final’s view of the Services Agreement’s connection to North

       Carolina is contrary to the unchallenged findings of fact as analyzed previously. This

       Court has recognized that “[a]lthough a contractual relationship between a North

       Carolina resident and an out-of-state party alone does not automatically establish

       the necessary minimum contacts with this State, nevertheless, a single contract may

       be a sufficient basis for the exercise of in personam jurisdiction if it has a substantial

       connection with this State.” Tom Togs, 318 N.C. at 367 (second emphasis omitted).

       Here, the Services Agreement does have a substantial connection with North

       Carolina, and Smart & Final has not argued that it would be unreasonable or

       inconvenient for the courts of this State to exercise jurisdiction. Therefore, we hold
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                                              2022-NCSC-81

                                          Opinion of the Court

       that the trial court did not err by denying Smart & Final’s motion to dismiss for lack

       of personal jurisdiction.

                                       III.    Conclusion

¶ 25          The Due Process Clause does not foreclose the exercise of personal jurisdiction

       over Smart & Final by the courts of this State on Toshiba’s breach of contract and

       related claims because the contract at issue has a substantial connection with this

       State. Smart & Final has “certain minimum contacts with [this State] such that the

       maintenance of the suit does not offend traditional notions of fair play and substantial

       justice.” Int’l Shoe, 326 U.S. at 316 (cleaned up). Accordingly, we affirm the decision

       of the trial court.

              AFFIRMED.