H&P Advisory Ltd. v. Randgold Res. Ltd.

• Decision Date: 12 June 2020
• Docket Number: S-19-0250
• Citation: 465 P.3d 433
• Parties: H&P ADVISORY LIMITED, a United Kingdom private limited company, Appellant (Plaintiff), v. RANDGOLD RESOURCES LIMITED, a Jersey corporation and Barrick Gold Corporation, a Canada corporation, Appellees (Defendants).
• Court: Wyoming Supreme Court

465 P.3d 433

H&P ADVISORY LIMITED, a United Kingdom private limited company, Appellant (Plaintiff),

v.RANDGOLD RESOURCES LIMITED, a Jersey corporation and Barrick Gold Corporation, a Canada corporation, Appellees (Defendants).

S-19-0250

Supreme Court of Wyoming.

June 12, 2020

Representing Appellant: Paul J. Hickey and Quinton Larsen Parham, Hickey & Evans, LLP, Cheyenne, Wyoming.

Representing Appellee: Kim D. Cannon, Davis & Cannon, LLP, Sheridan, Wyoming; Thomas J. McCormack and Victoria V. Corder, Norton Rose Fulbright US, LLP, New York, New York.

Before DAVIS, C.J., and FOX, KAUTZ, BOOMGAARDEN, and GRAY, JJ.

BOOMGAARDEN, Justice.

[¶1] H&P Advisory Limited, a United Kingdom private limited company, appeals the district court's order dismissing its complaint against Randgold Resources Limited, a Jersey (Channel Islands) corporation, and Barrick Gold Corporation, a Canada corporation (Appellees), for lack of personal jurisdiction. H&P argues the undisputed facts support personal jurisdiction over Appellees in Wyoming. Because we conclude those facts and all reasonable inferences in H&P's favor do not support personal jurisdiction over Appellees in Wyoming in this contract dispute, we affirm.

ISSUE

[¶2] Whether H&P made the required prima facie showing that Appellees are subject to specific personal jurisdiction in Wyoming.

FACTS¹

[¶3] Randgold and Barrick, two of the world's largest gold mining companies, unsuccessfully attempted merger several times. Ian Hannam, H&P's founder, learned of these attempts through his friendships with Mark Bristow and John Thornton, the operational chiefs of Randgold and Barrick, respectively. Seeing an opportunity to help Randgold and Barrick merge, Mr. Hannam contacted Mr. Thornton in early 2018 to propose a renewed round of merger talks between the companies. Mr. Thornton agreed, stating Barrick and Randgold needed Mr. Hannam's "creativity and inspiration[.]" He suggested Mr. Hannam broker the deal. H&P served as a neutral broker between the two companies through March.

[¶4] In early April, Mr. Thornton and Mr. Bristow agreed Mr. Hannam's role should transition to Randgold's independent advisor. Mr. Thornton asked Mr. Hannam to brief Michael Klein, the founder of the investment bank M. Klein & Company, who would independently advise Barrick. Mr. Hannam did so at Mr. Klein's New York office on April 3 and 4, 2018.

[¶5] Two weeks later, Mr. Bristow suggested those involved in the merger meet in Jackson, Wyoming to participate in a series of negotiations at his personal, part-time residence. Mr. Hannam, Mr. Bristow, Mr. Thornton, and Mr. Klein all traveled to Wyoming for that purpose. While in Wyoming, Mr. Hannam proposed to Mr. Bristow a fee structure for H&P's work (the Fee Agreement):

in exchange for H&P's advisory services in the course of brokering, negotiating and consummating the Merger, Randgold would compensate H&P as advisor and broker at closing with a fee not less than $10 million, which was 0.1 percent of the then-contemplated value of the transaction. The parties further agreed that the $10 million minimum would be subject to a pro rata upward adjustment if the value of the Merger increased, and that H&P's fee would be at least as high as the fee paid to M. Klein & Company, which advised Barrick in connection with the Merger. The parties also agreed that H&P would be eligible to receive a discretionary fee in addition to the fee agreed under these terms.

Mr. Bristow agreed to these terms.²

[¶6] Mr. Bristow and Mr. Thornton also reached an agreement in principle for the merger while in Wyoming. However, Mr. Klein proposed renegotiating that agreement shortly after he left Wyoming. Mr. Hannam took issue with Mr. Klein's proposed terms and worked with other H&P employees over the next five months to negotiate a structural change to the merger. That change increased the merger's value "to approximately $18 billion."

[¶7] Randgold and Barrick announced the merger in September 2018 but did not list H&P as an advisor. H&P sent Randgold an invoice for $18 million plus expenses shortly thereafter. Randgold refused to pay the invoice, saying it had no knowledge of its requirement to pay H&P's fee. Instead, Randgold offered to pay H&P a "small fee" for its role in the merger.

[¶8] H&P sued Randgold and Barrick on February 26, 2019,³ in the Ninth Judicial District in and for Teton County, Wyoming. It alleged breach of contract and, in the alternative, unjust enrichment. Appellees moved to dismiss, arguing in relevant part the district court lacked personal jurisdiction over them. The district court dismissed H&P's complaint on personal jurisdiction grounds.

STANDARD OF REVIEW

[¶9] We review a dismissal for lack of personal jurisdiction on undisputed facts de novo. State v. Moody's Investors Serv. , 2015 WY 66, ¶ 11, 349 P.3d 979, 982–83 (Wyo. 2015). Because the district court made its determination without an evidentiary hearing, H&P "must show only a prima facie case to defeat the motion to dismiss." Id. ¶ 11, 349 P.3d at 982 (quoting Black Diamond , ¶ 17, 278 P.3d at 742 ). In determining whether H&P carried its burden, we view the allegations in the pleadings and documentary evidence brought to the district court's attention in the light most favorable to H&P and resolve all reasonable inferences in H&P's favor. Id . ¶ 11, 349 P.3d at 982–83.

DISCUSSION

[¶10] Wyoming's long-arm statute authorizes this State's courts to exercise personal jurisdiction "on any basis not inconsistent with the Wyoming or United States constitution." Wyo. Stat. Ann. § 5-1-107(a) (LexisNexis 2019). "The Due Process Clause of the Fourteenth Amendment to the United States Constitution operates as a limitation on the jurisdiction of state courts to enter judgments affecting rights or interests of nonresident defendants." Moody's , ¶ 13, 349 P.3d at 983 (quoting O'Bryan v. McDonald , 952 P.2d 636, 638 (Wyo. 1998) ); see also Woodie v. Whitesell , 2019 WY 115, ¶ 16, 451 P.3d 1152, 1157 (Wyo. 2019) (citing Black Diamond , ¶ 19, 278 P.3d at 743 ). "Due process requires that the defendant[s] have certain ‘minimum contacts’ with the forum state such that the exercise of jurisdiction over [them] does not offend ‘traditional notions of fair play and substantial justice.’ " Black Diamond , ¶ 19, 278 P.3d at 743 (quoting Int'l Shoe Co. v. Washington , 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945) ). In other words, the Due Process Clause protects Appellees’ "liberty interest in not being subject to the binding judgments of a forum with which [they have] established no meaningful ‘contacts, ties, or relations.’ " Burger King Corp. v. Rudzewicz , 471 U.S. 462, 471–72, 105 S.Ct. 2174, 2181, 85 L.Ed.2d 528 (1985) (quoting Int'l Shoe , 326 U.S. at 319, 66 S.Ct. at 160 ).

[¶11] The foundational criteria against which we measure Appellees’ contacts, ties, and relations with Wyoming are well established:

the criteria by which we mark the boundary line between those activities which justify the subjection of a corporation to suit, and those which do not, cannot be simply mechanical or quantitative. The test is not merely, as has sometimes been suggested, whether the activity, which the corporation has seen fit to procure through its agents in another state, is a little more or a little less. Whether due process is satisfied must depend rather upon the quality and nature of the activity in relation to the fair and orderly administration of the laws which it was the purpose of the due process clause to insure. That clause does not contemplate that a state may make binding a judgment in personam against an individual or corporate defendant with which the state has no contacts, ties, or relations.

But to the extent that a corporation exercises the privilege of conducting activities within a state, it enjoys the benefits and protection of the laws of that state. The exercise of that privilege may give rise to obligations, and, so far as those obligations arise out of or are connected with the activities within the state, a procedure which requires the corporation to respond to a suit brought to enforce them can, in most instances, hardly be said to be undue.

Int'l Shoe , 326 U.S. at 319, 66 S.Ct. at 159–60 (emphasis added) (citations omitted). In applying these foundational criteria, "[w]e have adopted the United States Supreme Court's distinction between ‘general’ and ‘specific’ personal jurisdiction[.]"⁴ Moody's , ¶ 14, 349 P.3d at 983 ; Helicopteros Nacionales de Colombia, S.A. v. Hall , 466 U.S. 408, 414, nn. 8–9, 104 S.Ct. 1868, 1872, nn. 8–9, 80 L.Ed.2d 404 (1984) ; and Burger King , 471 U.S. at 475 n.18, 105 S.Ct. at 2184 n.18. H&P argues only with respect to specific personal jurisdiction, so we limit our review accordingly.

[¶12] We apply a three-part test to determine whether the quality and nature of Appellees’ Wyoming activity was of the type necessary to support specific personal jurisdiction. First, Appellees must have purposefully availed themselves of the privilege of acting in Wyoming or of causing important consequences in Wyoming.⁵ Moody's , ¶ 15, 349 P.3d at 983 (citing First Wyoming Bank, N.A. Rawlins v. Trans Mountain Sales & Leasing, Inc. , 602 P.2d 1219, 1221 (Wyo. 1979) ). Second, H&P's cause of action must arise from consequences in Wyoming of the Appellees’ activities. Id. Finally, the Appellees’ activities or the consequences of those activities must have a substantial enough connection with Wyoming to make the exercise of jurisdiction over Appellees reasonable. Id.

[¶13] H&P relies on facts showing it entered into the Fee Agreement in Wyoming and partially performed under that Fee Agreement while in Wyoming as its prima facie case that parts one and two of the three-part test are satisfied.⁶ Relevant to these points, H&P's complaint and Mr. Hannam's affidavit state:

• Mark Bristow, then the Chief Executive Officer of Randgold, requested that [Mr. Hannam] travel to Jackson, Wyoming, where [Mr.

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