Schartner v. Northwest Intern. Equipment Co., Inc.
| Decision Date | 14 September 1988 |
| Docket Number | No. 88-C-273.,88-C-273. |
| Citation | 694 F. Supp. 1364 |
| Parties | Robert SCHARTNER, Plaintiff, v. NORTHWEST INTERNATIONAL EQUIPMENT COMPANY, INC., Defendant. |
| Court | U.S. District Court — Eastern District of Wisconsin |
Randall Nesbitt, Pinkert, Smith, Weis, Jinkins & Nesbitt, Sturgeon Bay, Wis., for plaintiff.
Thomas Schober, Schober & Ulatowski, Green Bay, Wis., for defendant.
DECISION AND ORDER
Plaintiff Robert Schartner, a citizen of Wisconsin, is in the business of growing and selling fruit in Door County, Wisconsin. In 1987, he contracted to purchase equipment costing $46,490.00 for processing apples from the defendant Northwest International Equipment Company, Inc., a company which is incorporated in the State of Washington with its principal place of business in Yakima, Washington. The plaintiff claims that this equipment did not perform properly after he had it installed. Therefore, he commenced this action claiming breach of contract, breach of warranty and misrepresentation and seeks recission of the contract, return of the purchase price, incidental and consequential damages, punitive damages, prejudgment interest, and costs. This court has diversity jurisdiction over the subject matter of these claims. See 28 U.S.C. § 1332.
The defendant has responded to the complaint by moving to dismiss on the ground that this court lacks personal jurisdiction over it. See Federal Rule of Civil Procedure 12(b)(2). After this motion was filed the plaintiff was granted a continuance to conduct discovery to support his allegation of jurisdiction. The time for conducting this discovery has now passed and Northwest has renewed its motion which is supported by the affidavits of Ted Marquis, Sr., the president of Northwest International Equipment Company, Inc.; of Raymond Penuel, the person Northwest sent to inspect the equipment sold to Schartner; and of James Carter, a salesman for Northwest. The plaintiff has responded by submitting affidavits from the plaintiff, Robert Schartner, and exerpts from the deposition testimony of Randy Morrison, the advertising manager of The Goodfruit Grower magazine, of James Carter, of Theodore M. Marquis, and of Ray Penuel.
According to the allegations of the complaint and the affidavits, in May of 1986, plaintiff Robert Schartner responded to an advertisement in The Goodfruit Grower, a national trade publication, by calling the advertiser, Sirron Systems, for information about Sirron's cold air fruit dryer. See Affidavit of Robert Schartner at ¶ 3. The Goodfruit Grower is a magazine of national circulation which had 14,106 subscribers in 1985; 12,541 subscribers in 1986; and 12,500 subscribers in 1987. Although most of the subscribers have addresses in the Pacific Northwest, there were 27 Wisconsin subscribers in 1985; 13 Wisconsin subscribers in 1986; and 26 Wisconsin subscribers in 1987. See Deposition Upon Oral Examination of Randy Morrison at 9-11, Exhibits 4D, 4E & 4F.
On March 19, 1987, defendant Northwest International Equipment Company, Inc. obtained an exclusive license to manufacture and distribute the Sirron equipment. Northwest placed advertising for the Sirron dryer and other fruit processing equipment in The Goodfruit Grower from February 1, 1986 through December 1, 1987. See Id. at 16-20. In May or June of 1987, the plaintiff responded to one of the advertisements for the cold air dryer and called the defendant to request a sales proposal. See Affidavit of Robert Schartner at ¶ 5. On June 12, 1987, the defendant sent Schartner a proposal for the sale of several pieces of equipment, including a cold air dryer, a dump tank, a small fruit eliminator, a brusher/waxer, and a sorting table. The proposal stated that:
NORTHWEST, with over 40 years of experience in the fruit industry, is committed to quality. We are also committed to service after the sale and are prepared to respond quickly to your request for service or technical questions, if the need should arise. In other words, NORTHWEST stands behind their products 100%.
Complaint at Exhibit A. This written proposal was followed by a telephone call from Northwest to Schartner for the purpose of soliciting the sale. See Affidavit of Robert Schartner at ¶ 7.
On July 6, 1987, the plaintiff placed an order for four pieces of the equipment by calling Northwest in Washington. See Affidavit of Robert Schartner at ¶ 8 & Exhibit 3. The total price of this purchase was $46,690.00.1 In August and September the plaintiff sent partial payments of $20,000.00 and $13,639.17 to the defendant. See Id. at ¶¶ 11 & 13. The remainder of the purchase price, plus accrued interest, remains unpaid. In November, Schartner ordered a small fruit eliminator priced at $2,950.00,2 and in December he placed an order for a gauge priced at $12.35. See Affidavit of Robert Schartner at Exhibit 8; Deposition Upon Oral Examination of James D. Carter at Exhibit 24. All the equipment except the gauge was sent in two shipments by the defendant to the plaintiff in Sturgeon Bay, Wisconsin in November of 1987. Northwest also sent instructions for assembly, but encouraged Schartner to have a Northwest serviceperson travel to Wisconsin to assist with the installation. See Affidavit of Robert Schartner at ¶ 21 & Exhibit 13. Instead, Schartner engaged "professionals" to assemble the equipment and paid them $25,862.51. See Complaint at ¶ 11; Affidavit of Robert Schartner at ¶ 22.
On January 14, 1988, Schartner sent a telegram to Northwest rejecting the equipment on the ground that it had failed to work properly. See Affidavit of Robert Schartner at Exhibit 16. On January 20, 1988, Northwest sent Ray Penuel to Wisconsin to inspect the equipment and to discuss the trouble Schartner alleged he was having. See Id. at ¶ 27; Deposition Upon Oral Examination of Ray Penuel. Schartner remained dissatisfied and filed this lawsuit on March 15, 1988, seeking recission, return of the purchase price, incidental and consequential damages of $164,862.51, punitive damages of $100,000.00 and prejudgment interest.
A federal district court in Wisconsin has personal jurisdiction over a party in a diversity action only if the Wisconsin long-arm statute, Wis.Stat. § 801.05, authorizes jurisdiction and if the exercise of jurisdiction is consistent with due process. See Jacobs/Kahan & Company v. Marsh, 740 F.2d 587, 589 (7th Cir.1984). Upon a challenge by a defendant, the burden shifts to the plaintiff to demonstrate the propriety of exercising in personam jurisdiction over the defendant. See United States Railway Company v. Port Huron & Detroit Railroad Company, 495 F.2d 1127, 1128 (7th Cir.1974). If the issue is to be resolved by the court solely on the basis of pleadings and materials attached thereto, the plaintiff need only make a prima facie case of jurisdiction in order to avoid a motion to dismiss. See Welsh v. Gibbs, 631 F.2d 436, 438 (6th Cir.1980), cert. denied, 450 U.S. 981, 101 S.Ct. 1517, 67 L.Ed.2d 816 (1981). A plaintiff establishes a prima facie case by showing that there is compliance with the forum state's long arm statute. See Brunswick Corporation v. Suzuki Motor Company, Ltd., 575 F.Supp. 1412, 1416-17 (E.D.Wis.1983). However, if, as here, the party seeking dismissal on jurisdictional grounds submits affidavits, the nonmoving party may not rest upon allegations or denials in its pleadings, but must respond with affidavits or other evidence setting forth specific facts showing that the court has jurisdiction. See Weller v. Cromwell Oil Company, 504 F.2d 927, 929 (6th Cir.1974). The court is required to consider these pleadings and affidavits in the light most favorable to the plaintiff. See Jacobs/Kahan & Company, 740 F.2d at 589.
In this case the plaintiff has established a prima facie case by pointing to subsections 801.05(4)(a) and 801.05(5)(c) & (e) of the Wisconsin Statutes which, it contends, apply in this situation. These subsections provide that:
Wis.Stat. § 801.05(4), (5)(c) & (e).
The plaintiff believes that these subsections apply because:
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