65 F.3d 1427 (8th Cir. 1995), 94-3331, Wessels, Arnold & Henderson v. National Medical Waste, Inc.

Docket Nº:94-3331MN.
Citation:65 F.3d 1427
Case Date:September 07, 1995
Court:United States Courts of Appeals, Court of Appeals for the Eighth Circuit

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65 F.3d 1427 (8th Cir. 1995)




No. 94-3331MN.

United States Court of Appeals, Eighth Circuit

September 7, 1995

Submitted May 19, 1995.

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[Copyrighted Material Omitted]

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William F. Mohrman, Minneapolis, MN, argued, for appellant.

Therese M. Marso, St. Paul, MN, argued (Darron C. Knutson and Brooks F. Poley, St. Paul, MN, on the brief), for appellee.

Before MORRIS S. ARNOLD, ROSS, and WOOD, JR. [*] Circuit Judges.

HARLINGTON WOOD, JR., Circuit Judge.

National Medical Waste [National], defendant-appellant, appeals the district court's 1 grant of summary judgment in favor of Wessels, Arnold & Henderson [Wessels], plaintiff-appellee. Wessels claimed that it had a contract with National to render a fairness opinion on a potential merger National was considering. The merger did not occur and National argued that payment was conditioned on its effectuation. The district court found payment was not conditioned upon the completion of the potential merger and Wessels had performed in accordance with the contract. National appeals.


Wessels is an investment banking firm in Minneapolis, Minnesota. National is a Delaware corporation with its principal place of

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business in Nashville, Tennessee, and is in the business of recycling medical waste. At the time of the transaction involved, National was a publicly traded corporation with five shareholders. In early 1992, Michael Kessler [Kessler], a partner at Wessels, and John Pappajohn [Pappajohn], a director and shareholder of National, discussed recruiting Kessler's expertise on a potential merger National was considering. Both parties dispute who initiated the business relationship at this point. Pappajohn was familiar with Kessler through Kessler's prior employment with Smith Barney in New York.

As a result of this phone call, Kessler drafted a proposed engagement letter regarding the services that Wessels could provide and forwarded the letter to Oren Embry [Embry], president of National and its Board of Directors. National replied with its own engagement letter, including numerous substantive changes. Included among the proposed changes was a provision requiring that Tennessee law govern the contract. Negotiations continued between Kessler and Embry concerning the terms of the agreement and it was resolved that Minnesota law would govern the contract. On July 29, 1992, the final letter agreement was executed between the parties. The contract obligations were as follows:

(a) Wessels would undertake a due diligence investigation of National;

(b) Wessels would assist and advise National as to the pricing, form, and structure of the merger;

(c) Wessels would render a "fairness opinion" of the proposed merger;

(d) Wessels would meet with National's Board of Directors and present and review facts supporting the conclusion reached; and

(e) Wessels would provide "other financial advisory and investment services" as National may request.

In return, National agreed to pay:

(a) A retainer fee in the amount of $50,000 payable upon the execution of this engagement letter; and

(b) A financial advisory fee of $200,000 payable within 20 business days from the delivery of the opinion (whether verbal or written) to the Board of Directors of National. If a verbal opinion is delivered, then Wessels will furnish a written opinion as soon as possible thereafter. The retainer fee will be credited against the financial advisory fee.

In addition, National agreed to indemnify Wessels and reimburse it for expenses incurred up to $20,000. It was also conceded that the contract could only be amended or modified in writing.

It is not disputed that National paid Wessels the $50,000 retainer fee when the letter was executed or that Wessels performed all of its obligations specified in the contract to National's satisfaction by September 1992. Ultimately, National decided not to proceed with the merger. Wessels submitted its invoice requesting a total payment of $167,268.57. 2

While the bill remained outstanding, National continued to contact Kessler. In October 1992, Embry called Kessler seeking suggestions of other firms which provide asset appraisal valuations. Pappajohn also visited Kessler in Minnesota on two occasions to discuss the outstanding bill. In June 1993, Wessels filed its complaint against National alleging breach of contract. National denied that it owed Wessels payment for its service alleging payment was conditioned on completion of the merger, which was never consummated.

National initially filed a motion to dismiss for lack of personal jurisdiction. The district court denied the motion, finding that there were sufficient minimum contacts. The district court found that Pappajohn contacted Kessler and actively pursued a business relationship with Wessels. In response to National's argument that Pappajohn had acted without authority, the court found that the

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director's action had been ratified and supported by National.

Wessels moved for summary judgment and the district court granted Wessels' motion. The court found that the July 29, 1992, letter was a complete integration of the parties' contractual agreement. The district court further held that the completion of the merger was not a condition precedent to National's obligation to pay on the grounds that it was contrary to the plain language of the agreement. National appeals, and we affirm.


We review a grant of summary judgment by considering all factual issues in the light most favorable to the nonmoving party (herein National) and determining de novo whether there was no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Bathke v. Casey's General Stores, Inc., 64 F.3d 340, 342-43 (8th Cir.1995) (citing Willman v. Heartland Hosp. E., 34 F.3d 605, 609 (8th Cir.1994), cert. denied, --- U.S. ----, 115 S.Ct. 1361, 131 L.Ed.2d 218 (1995)). Summary judgment is not appropriate if the evidence is such that a reasonable jury could return a verdict for the nonmoving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). With regard to the district court's denial of National's motion to dismiss for lack of personal jurisdiction, we examine de novo the question whether the plaintiff has established a prima facie case of personal jurisdiction. Bell Paper Box, Inc. v. Trans W. Polymers, Inc., 53 F.3d 920, 921 (8th Cir.1995); Northrup King Co. v. Compania Productora Semillas Algodoneras Selectas, S.A., 51 F.3d 1383, 1387 (8th Cir.1995). "Because jurisdiction is a threshold issue for the court, the district court has 'broader power to decide its own right to hear the case than it has when the merits of the case are reached.' " Bellecourt v. United States, 994 F.2d 427, 430 (8th Cir.1993), cert. denied, --- U.S. ----, 114 S.Ct. 1049, 127 L.Ed.2d 371 (1994) (quoting Osborn v. United States, 918 F.2d 724, 729 (8th Cir.1990)). If, as in this case, the court relied on disputed factual issues, then those factual findings will be reviewed under the clearly erroneous standard. Osborn, 918 F.2d at 730 (citations omitted).


Admitting that it was a close case, the district court denied National's motion to dismiss for lack of personal jurisdiction. The plaintiff, herein Wessels, bore the ultimate burden of proof on this issue. Dakota Indus., Inc. v. Dakota Sportswear, 946 F.2d 1384, 1387 (8th Cir.1991). "To defeat a motion to dismiss for lack of personal jurisdiction, the nonmoving party need only make a prima facie showing of jurisdiction." Id. (citations omitted).

The determination whether a court has personal jurisdiction must satisfy both state and constitutional requirements. Wines v. Lake Havasu Boat Mfg., 846 F.2d 40, 42 (8th Cir.1988) (per curiam). First, the applicable state long-arm statute, here Minnesota Sec. 543.19, 3 must be met. Second, personal jurisdiction must comply with the requirements of due process. Because Minnesota long-arm statutes extend jurisdiction to the maximum limit consistent with due process, we need only evaluate whether the district court properly found the requirements of due process satisfied. See Domtar v. Niagara Fire Ins. Co., 533 N.W.2d 25, 29 (Minn.1995); Valspar Corp. v. Lukken Color Corp., 495 N.W.2d 408, 410 (Minn.1992); Jenson v. R.L.K. & Co., 534 N.W.2d 719, 721-22 (Minn.Ct.App.1995). See also Northrup, 51 F.3d at 1387; Land-O-Nod v. Bassett Furniture Indus., 708 F.2d 1338, 1340 (8th Cir.1983).

Due process allows a court to exercise personal jurisdiction over a non-resident defendant when the defendant has "certain minimum contacts with [the state] such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.' " International Shoe Co.

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v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463, 61 S.Ct. 339, 342-43, 85 L.Ed. 278 (1940)). The defendant's conduct and connection with the state must be such that the defendant 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). The defendant's acts must be substantial enough to give clear notice that it would be subject to suit in the forum state. Id. However, the unilateral activities of one claiming some relationship with the non-resident defendant is not enough to satisfy the minimum contacts requirement. Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1239-40, 2 L.Ed.2d 1283 (1958). It is essential in each case that there is some act by which the "defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws." Id. Where a...

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