Inter-Collegiate Press, Inc. v. Myers, Civ. A. No. 81-2165.

• Decision Date: 05 August 1981
• Docket Number: Civ. A. No. 81-2165.
• Citation: 519 F. Supp. 765
• Parties: INTER-COLLEGIATE PRESS, INC., a corporation, Plaintiff, v. Frank MYERS, Defendant.
• Court: U.S. District Court — District of Kansas

519 F. Supp. 765

INTER-COLLEGIATE PRESS, INC., a corporation, Plaintiff, v. Frank MYERS, Defendant.

Civ. A. No. 81-2165.

United States District Court, D. Kansas.

August 5, 1981.

COPYRIGHT MATERIAL OMITTED

John M. Edgar, Stinson, Mag & Fizzell, Kansas City, Mo., George A. Lowe, Lowe, Terry & Roberts, Olathe, Kan., for plaintiff.

DeWitt M. Shy, Jr., Burch, Porter & Johnson, Memphis, Tenn., for defendant.

MEMORANDUM AND ORDER

SAFFELS, District Judge.

This matter comes before the Court upon plaintiff's motion for a temporary restraining order. In response, the defendant has filed a motion to dismiss for insufficiency of service of process, lack of in personam jurisdiction, and lack of venue. Because the defendant has attacked the power of the Court to issue a temporary restraining order, the motion to dismiss will be considered first.

Plaintiff brought this action for a breach of an employment contract. Plaintiff is a corporation organized under the laws of the state of Delaware with its principal place of business in Shawnee Mission, Kansas. It is engaged in the business of making and selling yearbooks, commencement announcements, diplomas and other similar school memorabilia for high schools, colleges and communities. Defendant is an individual residing in Memphis, Tennessee, who had a contract with plaintiff to act as a dealer of plaintiff's products in an eleven-state area. As part of his contract, defendant agreed to give a thirty-day notice prior to terminating the contract, and not to compete within the area for a period of two years. Plaintiff alleges that defendant has violated this contract by terminating his employment without thirty-days notice, and by soliciting and selling to plaintiff's customers products of a competing company. Plaintiff seeks injunctive relief to enforce the restrictive covenant.

The defendant first alleges that the action should be dismissed for insufficiency of service. At this juncture in the lawsuit, such a basis is not well-taken. The Court is aware that in other districts across the country the United States Marshal's Service has a certain amount of lag-time in serving summons. Nothing has been alleged in this case that would lead the Court to believe that the defendant will not be served in the course of ordinary process. Therefore, the motion to dismiss will not be granted on this basis at this time.

The defendant asserts as his second basis for the motion to dismiss that the Court lacks personal jurisdiction over the defendant. In Thermal Insulation Systems, Inc. v. Ark-Seal, Corp., 508 F.Supp. 434 (D.Kan. 1980), the Honorable Richard D. Rogers recently set out the appropriate analysis to be followed when considering personal jurisdiction questions:

"... First, it must be determined whether the defendant's conduct falls within the scope of any of the enumerated provisions of the Kansas long arm statute. Then, it must be determined whether the defendant's contacts with the state of Kansas are sufficient to meet the due process requirements set out in International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed.2d 95 (1945), and further developed in Shaffer v. Heitner, 433 U.S. 186, 97 S.Ct. 2569, 53 L.Ed.2d 683 (1977), and Kulko v. Superior Court, 436 U.S. 84, 98 S.Ct. 1690, 56 L.Ed.2d 132 (1978), and most recently in World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980). Both the statutory and constitutional requirements must be met for this court to assert personal jurisdiction over the defendant...." Id. at p. 436.

Plaintiff asserts that this Court has personal jurisdiction over the defendant under the provisions of K.S.A. 60-308(b)(1) and (b)(5). These sections provide:

"(b) Submitting to jurisdiction — process. Any person, whether or not a citizen or resident of this state, who in person or through an agent or instrumentality does any of the acts hereinafter enumerated, thereby submits said person, and, if an individual, his or her personal representative, to the jurisdiction of the courts of this state as to any cause of action arising from the doing of any of said acts:

"(1) The transaction of any business within this state;

* * * * * *

"(5) Entering into an express or implied contract, by mail or otherwise, with a resident of this state to be performed in whole or in part by either party in this state;"

This statute reflects a "conscientious state policy to assert jurisdiction over nonresident defendants to the extent permitted by the due process clause of the Fourteenth Amendment to the Constitution of the United States." Woodring v. Hall, 200 Kan. 597, 602, 438 P.2d 135, 181 (1968). Based on the facts presented to this Court at the hearing on July 15, 1981, the defendant is clearly subject to the jurisdiction of the courts in the state of Kansas under K.S.A. 60-308.

At the hearing on July 15, 1981, the testimony clearly showed the extensive business transacted by defendant in this state. The defendant was trained by plaintiff in this state, and he returned for annual meetings every year since his affiliation with plaintiff. Furthermore, he visited the home office at least once every four to six weeks, and dealt directly with the home office rather than through a regional supervisor. Additionally, he received numerous supplies from plaintiff, many of which he picked up personally while in Kansas. Plaintiff also paid, from Kansas, for defendant's WATS line, an IBM typewriter, and numerous other supplies and samples. Defendant had many telephone conversations with plaintiff in Kansas with regard to pricing, and his consultations with plaintiff with regard to competitive bidding and establishing a bid price were extensive. Finally, the activities resulted in almost one-third of one million dollars worth of business coming into the state of Kansas, and defendant's commissions on that business were paid from plaintiff's home office in Kansas. Accordingly, it is evident that the defendant had extensive business dealings in this forum which were for his benefit as well as the plaintiff's. They were necessary for the adequate servicing of his accounts, for which he received commissions, and on at least several occasions, defendant received materials and supplies necessary for conducting his business while he was in Kansas. As a result, defendant's activities fall squarely within the definition of "transacting business" found in Woodring v. Hall, 200 Kan. at 600, 438 P.2d at 145.

"... In a broad sense, `business' is transacted within the state when an individual is within or enters this state in person or by agent and, through dealing with another within the state, effectuates or attempts to effectuate a purpose to improve his economic conditions and satisfy his desires...." 200 Kan. at 607.

Thus, considering all the defendant's business activities, we find that the defendant did transact business in Kansas within the meaning of K.S.A. 60-308(b)(1).

We now turn to an analysis under the due process considerations as they operate as a limitation on jurisdiction over nonresidents. Under due process analysis, a court must look to the "quality and nature" of the defendant's activity to determine whether it is both "reasonable" and "fair" to require the defendant to conduct his defense in the forum state. Kulko v. California Superior Court, 436 U.S. 84, 92, 98 S.Ct. 1690, 1696, 56 L.Ed.2d 132 (1978). In addition, there must be "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." Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1239, 2 L.Ed.2d 1283 (1958). Further, in considering the "minimum contacts" with the forum state, the Court should determine if "the defendant's conduct and connection with the forum State are such that he 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).

Here, the defendant chose to be employed by a corporation with its principal place of business in Kansas. He was present within the state on numerous occasions as part of his employment with plaintiff. Payment for his services and expenses were made in Kansas. Under the due process analysis, we find that jurisdiction is proper under this set of facts. The defendant availed himself of the benefits of the laws of Kansas by seeking employment with a Kansas-based employer. He knew who he was employed by and could readily foresee and anticipate that any complaints regarding his employment would originate in the Kansas-based office.

Having found that jurisdiction exists under K.S.A. 60-308(b)(1), we deem it unnecessary to consider the other basis for jurisdiction alleged...