Finley v. River North Records, Inc.

• Decision Date: 23 June 1998
• Docket Number: No. 97-2698,97-2698
• Citation: 148 F.3d 913
• Parties: Dan FINLEY, doing business as E & F Enterprises; Rick Eby, doing business as E & F Enterprises, Appellees, v. RIVER NORTH RECORDS, INC., Appellant.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 913

148 F.3d 913

Dan FINLEY, doing business as E & F Enterprises; Rick Eby doing business as E & F Enterprises, Appellees, v. RIVER NORTH RECORDS, INC., Appellant.

No. 97-2698.

United States Court of Appeals Eighth Circuit.

Submitted Jan. 16, 1998.

Decided June 23, 1998.

William B. Putman, Fayetteville, AR, argued, for Appellant.

David R. Matthews, Rogers, AR, argued (Mark T. Fryauf, on the brief), for Appellee.

Before RICHARD S. ARNOLD, ¹ Chief Judge, MORRIS SHEPPARD ARNOLD, Circuit Judge, and SACHS, ² District Judge.

RICHARD S. ARNOLD, Chief Judge.

E & F Enterprises, concert promoters, sued River North Records, a record company, and Entertainment Artists, a booking agency, for fraud related to representations of the defendants that certain performers would appear in a concert at the University of Arkansas. A jury found for E & F and awarded compensatory and punitive damages. On appeal, River North Records argues that the court did not have personal jurisdiction and that there was insufficient evidence to support the jury's verdict and award. We affirm.

I.

In 1993, Dan Finley and Rick Eby formed E & F Enterprises, a partnership, for the purpose of promoting music concerts. On September 12, 1995, Finley and Eby contracted with Entertainment Artists, Inc., a Nashville, Tennessee-based booking agent, to promote a concert featuring Peter Cetera, the former lead singer for the group "Chicago." The concert was to take place at the University of Arkansas's Barnhill Arena in Fayetteville, Arkansas on October 27, 1995. Before signing the contract, Finley and Eby discussed the concert with Dan Wojcik, President of Entertainment Artists. Wojcik told them that performer Crystal Bernard, star of the television show "Wings," the Don Henley Band, consisting of members who formerly played in the hit group the "Eagles," and singer Ronna Reeves would appear with Peter Cetera. Cetera and Bernard had recorded a duet, "Forever Tonight," which had reached the "Top 10" in the weeks preceding the concert date.

Cetera, Bernard, and Reeves were recording artists for River North Records, Inc. After the contract with Entertainment Artists was signed, Finley called Michelle Brown, Director of Publicity in River North's Nashville office, for promotional materials for the artists who would be appearing at the concert. She sent Finley a promotional package, which included a brochure, a photograph of Cetera and Bernard, Cetera's most recent album, and the music video of the Cetera and Bernard duet. Finley called Brown on other occasions to discuss the concert promotion. On or about October 19, 1995, Finley and Eby learned that Bernard would not be performing at the concert through a news report indicating that Bernard had never been consulted about a concert performance with Cetera. Moreover, they learned that the "Don Henley Band" did not exist; the name was presumably created to promote ticket sales to the Cetera show. Finley and Eby decided to cancel the concert.

E & F sued Entertainment Artists and River North for fraud in the District Court. River North moved to dismiss the case for lack of personal jurisdiction. The District Court ³ denied the motion. Entertainment Artists defaulted, but judgment was not entered because E & F wished to present evidence of damages at trial. The case was tried to a jury. At the close of E & F's case, River North moved for judgment as a matter of law on the ground that plaintiffs' evidence of liability and damages was insufficient. The Court denied the motion. The jury returned a verdict for E & F, awarding $85,182 in compensatory damages--consisting of $15,182 in out-of-pocket costs and $70,000 in loss of future profits--against River North and Entertainment Artists jointly and severally. The jury also assessed $10,000 in punitive damages against River North and $50,000 against Entertainment Artists. River North filed post-trial motions for judgment as a matter of law, or, in the alternative, for remittitur of damages or for a complete new trial. The Court denied the motions. River North appeals from the denial of the post-trial motions and from the denial of the motion to dismiss for lack of personal jurisdiction. We affirm.

II.

River North contends that the District Court erroneously denied its motion to dismiss for lack of personal jurisdiction. The District Court found River North subject to personal jurisdiction in Arkansas for two reasons. First, Michelle Brown sent promotional materials featuring Cetera and Bernard to E & F and discussed the concert promotion several times by phone with Finley and Gene Fitch, Assistant Director of Campus Activities at the University of Arkansas at Fayetteville. Finley alleged that in his conversations with Brown, she confirmed that Bernard, the Don Henley Band, and Reeves would all appear at the Fayetteville concert. The District Court stated that the phone and mail communication alone, without more, were insufficient to confer jurisdiction over River North, but that such contacts might be considered for purposes of determining whether the defendant purposefully availed itself of the privilege of doing business in Arkansas.

Second, the Court found it significant that although River North and E & F had not directly contracted for the concert promotion, River North had hired Entertainment Artists to contract with promoters such as E & F. The Court reasoned that

RNR must work with 'booking agents' to do such work [concert promotion] for it. Once the tours are set up, RNR apparently participates to the extent it is needed to make the tour a success by providing promotional materials. As such, the acts of Entertainment Artists can be attributed to RNR for purposes of the personal jurisdiction analysis.

Appellant's Separate App. 43.

We agree with the District Court that personal jurisdiction over River North in an Arkansas federal court is consistent with both state and federal law. In Calder v Jones, 465 U.S. 783, 104 S.Ct. 1482, 79 L.Ed.2d 804 (1984), the Supreme Court considered a defamation case helpful to us here. In Calder, Shirley Jones, a professional entertainer residing and working in California, brought suit against two Florida residents for allegedly libelous statements they wrote and edited about her in the National Enquirer, a national magazine with its largest circulation in California. The defendants, contending that the article had been prepared entirely in Florida, asserted insufficient contacts with California for purposes of personal jurisdiction. The California Court of Appeal held that a valid basis for jurisdiction existed, on the theory that the defendants intended to and did cause tortious injury to the plaintiff in California.

The United States Supreme Court accepted the California Court of Appeal's rationale that the defendants' tortious conduct subjected them to jurisdiction in California. The Supreme Court rejected the defendants' argument that, as employees, they had no control over, and therefore were not responsible for, their employer's sales in a distant state:

[P]etitioners are not charged with mere untargeted negligence. Rather, their intentional, and allegedly tortious, actions were expressly aimed at California. Petitioner South wrote and petitioner Calder edited an article that they knew would have a potentially devastating impact upon respondent. And they knew that the brunt of that injury would be felt by respondent in the state in which she lives and works and in which the National Enquirer has its largest circulation. Under the circumstances, petitioners must "reasonably anticipate being haled into court there" to answer for the truth of the statements made in their article. An individual injured in California need not go to Florida to seek redress from persons who, though remaining in Florida, knowingly cause the injury in California.

465 U.S. at 789-90, 104 S.Ct. 1482 (quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980)).

In a trademark infringement case, this Court, relying on Calder, determined that personal jurisdiction was permissible over a non-resident defendant whose sportswear bearing a trademark-infringing label was ultimately sold in the forum state. Dakota Industries, Inc. v. Dakota Sportswear, Inc., 946 F.2d 1384 (8th Cir.1991). The defendant corporation argued that it had no contacts with the forum state, and that the marketing of its products in that state resulted exclusively from the unilateral actions of others. We rejected this reasoning, stating:

Although the defendant's lack of control over distribution of the product in the forum state may weigh against jurisdiction in a negligence action, that lack of control will not bar jurisdiction when the plaintiff has alleged an intentional tort.... [In Calder,] [t]he Supreme Court ... approved an "effects" test that allows the assertion of personal jurisdiction over non-resident defendants whose acts "are performed for the very purpose of having their consequences felt in the forum state."

946 F.2d at 1390-91 (citations omitted).

River North is amenable to personal jurisdiction in Arkansas under the reasoning set forth in Calder and developed in Dakota Industries. E & F alleged, and a jury found, that River North committed fraud in inducing E & F to promote the concert in Fayetteville by misrepresenting that Bernard and the Don Henley Band would appear with Cetera. Michelle Brown sent promotional materials into the state, knowing that they would be used commercially to promote the appearance of artists recorded by River North. Brown allegedly confirmed over the phone that all four artists would appear at the Barnhill Arena in Fayetteville. Trial testimony supports E & F's contention that River North knowingly misrepresented Bernard's appearance and the Don Henley Band's existence. This is fraudulent conduct, intended to induce commercial activity within the forum state. The fact...