620 F.2d 219 (10th Cir. 1980), 78-1614, Premier Corp. v. Newsom

Docket Nº:78-1614, 78-1615.
Citation:620 F.2d 219
Party Name:PREMIER CORPORATION, Plaintiff-Appellant, v. Joseph K. NEWSOM, Defendant-Appellee. PREMIER CORPORATION, Plaintiff-Appellant, v. Marcelino CHAVEZ, Defendant-Appellee.
Case Date:April 04, 1980
Court:United States Courts of Appeals, Court of Appeals for the Tenth Circuit
 
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Page 219

620 F.2d 219 (10th Cir. 1980)

PREMIER CORPORATION, Plaintiff-Appellant,

v.

Joseph K. NEWSOM, Defendant-Appellee.

PREMIER CORPORATION, Plaintiff-Appellant,

v.

Marcelino CHAVEZ, Defendant-Appellee.

Nos. 78-1614, 78-1615.

United States Court of Appeals, Tenth Circuit

April 4, 1980

Argued and Submitted Jan. 22, 1980.

Page 220

Darryl G. Kaneko, Denver, Colo. (Bruce T. Wallace of Hooper, Hathaway, Fichera & Price, Ann Arbor, Mich., with him on the brief), for plaintiff-appellant.

Gregory L. Williams of Rothgerber, Appel & Powers, Denver, Colo., for defendants-appellees.

Before McWILLIAMS, BARRETT and McKAY, Circuit Judges.

McWILLIAMS, Circuit Judge.

This case involves the Colorado long arm statute, C.R.S. 13-1-124 (1973). Premier Corporation is a Delaware corporation, with headquarters in Michigan. It also conducts business and maintains offices in Colorado. In separate actions, Premier brought a breach of contract action in a state court of Colorado against Dr. Newsom and Dr. Chavez, each of whom is a citizen of South Carolina. Both defendants are physicians, and each was served with a copy of the summons and complaint in South Carolina. On petitions for removal, both actions were removed to the United States District Court for the District of Colorado. Motions to remand were denied.

In federal district court the defendants filed motions to quash service of process on the ground that there was no valid service of process. The district court, after an evidentiary hearing that involved live testimony, several affidavits and depositions,

Page 221

granted the motions and dismissed both actions on the ground that there was a lack of in personam jurisdiction over both defendants. Premier appeals. We affirm.

The background facts as they relate to the question of personal jurisdiction are not in any real dispute. As indicated, Dr. Newsom and Dr. Chavez are both citizens of South Carolina. Both are medical doctors and each wanted to make a financial investment which might serve as a tax shelter.

Also, as indicated, Premier is a Delaware corporation with headquarters in Michigan. Premier is engaged, inter alia, in the business of cattle breeding and management of cattle. In mid-1972, representatives of Premier contacted Dr. Newsom and Dr. Chavez in South Carolina in an effort to induce the doctors to make an investment in what was said to be a tax-sheltered cattle operation. [*] As explained by Premier's representatives, Premier proposed to sell cattle to the defendants, and then, for a management fee, Premier would thereafter manage, feed and maintain the cattle thus purchased by the defendants. Premier and the two doctors agreed to terms, and the parties executed three documents: (1) a representation statement; (2) a purchase agreement; and (3) a management contract. Specifically, Dr. Newsom bought 100 head of nonregistered breeding cows from Premier at $750 per head and then entered into a management contract with Premier whereby, for a management fee, Premier agreed to take care of the cattle thus purchased. Dr. Chavez bought 180 head of nonregistered breeding cows for $750 per head and contemporaneously therewith entered...

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