Dehmlow v. Austin Fireworks

• Decision Date: 07 May 1992
• Docket Number: No. 91-1566,91-1566
• Citation: 963 F.2d 941
• Parties: Prod.Liab.Rep. (CCH) P 13,208 Craig DEHMLOW, Plaintiff-Appellant, v. AUSTIN FIREWORKS, Defendant-Appellee.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 941

963 F.2d 941

Prod.Liab.Rep. (CCH) P 13,208

Craig DEHMLOW, Plaintiff-Appellant, v. AUSTIN FIREWORKS, Defendant-Appellee.

No. 91-1566.

United States Court of Appeals, Seventh Circuit.

Argued Nov. 8, 1991.

Decided May 7, 1992.

As Amended May 7, 1992.

Timothy D. McMahon and Erica Nan Long (argued), Wiedner & McAuliffe, Chicago, Ill., for plaintiff-appellant.

Dinah L. Archambeault and Neil T. Goltermann (argued), Spesia & Ayers, Joliet, Ill., for defendant-appellee.

Before CUMMINGS and RIPPLE, Circuit Judges, and CRABB, Chief District Judge. ^*

CUMMINGS, Circuit Judge.

Craig Dehmlow, an Illinois resident, was seriously injured in Barrington, Illinois, when a firework sold by defendant Austin Fireworks ("Austin") improperly exploded. Austin, a Kansas corporation, manufactured and distributed fireworks including the allegedly defective firework to a Wisconsin corporation for the stated purpose of displaying the fireworks in Illinois and other Midwestern states. On appeal, the question presented is whether Austin had minimum contacts with Illinois such that Illinois courts may constitutionally exercise personal jurisdiction over Austin. The district court held not, but we disagree.

I.

Plaintiff Craig Dehmlow was severely injured during a 1988 Fourth-of-July fireworks display at Barrington High School in Barrington, Illinois. ¹ Dehmlow, a Carpentersville, Illinois, resident, had been hired for the Barrington fireworks display as a fireworks "shooter" by Bartolotta Fireworks, Inc., a Wisconsin Corporation. While employed as such, Dehmlow sustained severe and permanent injuries and disfigurement when one of the fireworks manufactured and distributed by defendant Austin improperly detonated (Appellant Br. 8).

Dehmlow filed a products liability claim against Austin in the Circuit Court of Cook County in order to recover damages for his personal injury. Dehmlow invoked the jurisdiction of the Illinois courts under the "tortious act" provision of the Illinois long-arm statute, Ill.Rev.Stat. ch. 110, p 2-209(a)(2) (1987). Austin received a summons and complaint by certified mail through the Secretary of State pursuant to the Business Corporation Act of 1983, Ill.Rev.Stat. ch. 32, p 5.30 (1987), and subsequently removed the case to federal court based on diversity jurisdiction. There Austin moved for dismissal pursuant to Federal Rules of Civil Procedure 12(b)(2) and 12(b)(4) for lack of personal jurisdiction and for insufficiency of process. In the alternative, Austin moved to dismiss because of issue preclusion, a motion based on a previous suit brought by Austin's insurance carrier. Dehmlow contended that the exercise of personal jurisdiction over the defendant met the requirements of both the Illinois long-arm statute and the Due Process Clause of the Fourteenth Amendment. Dehmlow also maintained that service of process was proper under the Illinois Business Corporation Act. Moreover, he asserted that issues raised in the previous case were not identical, actually litigated, or actually and necessarily determined.

As a basis for resolving the personal jurisdiction issue in federal district court, Dehmlow submitted the following information. Defendant Austin Fireworks is incorporated in Kansas, and has its principal place of business in that state. Austin imports, assembles, and sells fireworks and conducts fireworks displays for cities and governmental entities. Austin advertises its fireworks in national publications and has never restricted its sales to particular states. Among its clients, Austin identified twelve regular Illinois customers. In 1988 and 1989 Austin sold fireworks to Nostalgia Pyrotechnics, Gemini Fireworks, Stars and Stripes, and Traditional American--all Illinois businesses. In 1987, 1988, and 1989, Austin conducted fireworks displays for the Village of Streator in Streator, Illinois. Austin signed contracts with Streator, under which Austin agreed to install, set up, display, operate, and remove all equipment necessary for the displays. One of Austin's Kansas employees travelled to Illinois to conduct the display and Austin employed Illinois residents to assist with those displays.

In 1988, after many negotiations over the telephone, Austin travelled to Chicago to discuss putting on Chicago's Fourth-of-July fireworks display with an official from the Mayor's Office of Special Events for the City of Chicago. Solely as a result of the City's late notice of contract, Austin was unable to perform Chicago's fireworks display. However, in 1989, Austin sold $35,458.55 of fireworks equipment for the City of Chicago's August 1989 Venetian Night fireworks display. This sale is believed to be Austin's largest sale in 1989. Austin helped the City of Chicago plan the display, delivered the fireworks equipment to Chicago, ordered additional shipments of fireworks to Navy Pier, and hired a driver to return the equipment to Kansas. Paul Austin, President of Austin Fireworks, attended Venetian Night to solicit additional business.

Austin sold the allegedly defective firework that injured Dehmlow to Bartolotta Fireworks, Inc. ("Bartolotta"), located in Genesee Depot, Wisconsin, approximately 40 miles north of the Illinois-Wisconsin border. Bartolotta manufactures fireworks and puts on fireworks displays in Illinois and other midwestern states. Bartolotta's president, Sam Bartolotta, told Austin president Paul Austin that Bartolotta intended to transport some of Austin's fireworks to Illinois for fireworks displays.

In a memorandum opinion, the district court dismissed Dehmlow's case for lack of personal jurisdiction based on World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980). Dehmlow filed a motion to vacate the district court's judgment and to transfer the action to the United States District Court, District of Kansas. However, Dehmlow's motion was denied. ² On appeal, Dehmlow challenges the trial court's determination that defendant's Fourteenth Amendment right to due process of law prohibits Illinois courts from exercising personal jurisdiction over the defendant. ³

II.

A.

In order to determine the scope of a federal district court's personal jurisdiction in a diversity case, this Court examines state law governing personal jurisdiction. FMC Corp. v. Varonos, 892 F.2d 1308, 1310 (7th Cir.1990). When resolving the question of state court jurisdiction over a defendant, a court must make two inquiries: 1) whether a state statute grants personal jurisdiction over the defendant and 2) whether such jurisdiction is within constitutional bounds. Giotis v. Apollo of the Ozarks, Inc., 800 F.2d 660, 665 (7th Cir.1986). The first inquiry is wholly unnecessary in the case of many modern state statutes which include catch-all provisions that grant to state courts jurisdiction over all matters in which the state may constitutionally assert jurisdiction. See, e.g., Ill.Rev.Stat. ch. 110, p 2-209(c) (1989). ⁴ Illinois explicitly provides for personal jurisdiction over a defendant who has committed a tortious act in Illinois, Ill.Rev.Stat. ch. 110, p 2-209(a)(2) (1987 & 1989), and has long evinced a desire to exercise jurisdiction in such circumstances. See, e.g., Gray v. American Radiator & Standard Sanitary Corp., 22 Ill.2d 432, 176 N.E.2d 761 (1961). Because the statutory basis for jurisdiction is clear, the central issue raised in this case regards the constitutionality of exercising personal jurisdiction over a nonresident defendant that sold its product for ultimate use in Illinois and the product caused serious injury in Illinois to a citizen of Illinois.

Under the Due Process Clause, a state court may exercise personal jurisdiction over a nonresident defendant if, given the contacts with the forum state, that exercise of jurisdiction comports with "traditional notions of fair play and substantial justice." International Shoe Co. 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, 343, 85 L.Ed. 278 (1940)). This Court's analysis begins with the fair play and substantial justice standard--the only standard agreed upon by a majority of Supreme Court Justices in the Court's most recent adjudication involving personal jurisdiction. Asahi Metal Industry Co. v. Superior Court of California, 480 U.S. 102, 107 S.Ct. 1026, 94 L.Ed.2d 92 (1987) (Part II.B, opinion of the Court). Several factors inform the fairness of a state court's exercise of jurisdiction over a defendant. Those factors include:

"the burden on the defendant, the interests of the forum State, and the plaintiff's interest in obtaining relief. It must also weigh in its determination 'the interstate judicial system's interest in obtaining the most efficient resolution of controversies; and the shared interest of the several States in furthering fundamental substantive social policies.' "

Id. at 113, 107 S.Ct. at 1033 (quoting World-Wide Volkswagen v. Woodson, 444 U.S. 286, 292, 100 S.Ct. 559, 564). Upon weighing these considerations in the case before us, it is clear that haling defendant into an Illinois court would be both fair and reasonable.

The burden defendant faces in adjudicating its case in Illinois is not a heavy one. Unlike Asahi, in the present case long-arm jurisdiction does not extend beyond national boundaries and the defendant does not have to defend itself in a foreign nation's judicial system. The journey from Kansas to Illinois is not an onerous one for Austin, whose employees have travelled that route for business purposes several times in the recent past.

Furthermore, both Dehmlow and the State of Illinois have significant interests in adjudicating the case in Illinois. Dehmlow, a citizen of Illinois, has claimed that the injury inflicted on him in the State of Illinois by the defendant's defective product has caused him to suffer serious and permanent injury and disfigurement. In addition to its...