Shipowners Litigation, In re
| Decision Date | 22 January 1985 |
| Docket Number | No. C2-84-1403,C2-84-1403 |
| Parties | 1985-1 Trade Cases P 66,379 In re SHIPOWNERS LITIGATION. I.S. JOSEPH COMPANY, INC., et al., Appellants, v. Erik HELLSTENIUS, et al., Additional Defendants on Counterclaim, Respondents. |
| Court | Minnesota Court of Appeals |
Syllabus by the Court
1. The trial court properly dismissed this counterclaim due to lack of personal jurisdiction since respondents were in Minnesota for only one meeting to which they were invited for a settlement conference.
2. The Minnesota Antitrust statute does not provide an independent basis for personal jurisdiction.
William Z. Pentelovitch and Mary R. Vasaly, Minneapolis, for appellants.
William E. Mullin and Roy E. Potter, Minneapolis, for respondents.
Heard, considered, and decided by NIERENGARTEN, P.J., and FOLEY and CRIPPEN, JJ.
This is an appeal from dismissal of appellants' counterclaim against respondents for lack of personal jurisdiction.
Plaintiffs in this action are two Norwegian partnerships, Partrederiet Lista (Lista) and Partrederiet Polycrest (Polycrest); a Liberian corporation, Scout Shipping Co., Inc. (Scout); a Danish corporation, J. Lauritzen; and a Japanese corporation, Taiheiyo Kaiun Co. Ltd. Defendants are I.S. Joseph Co., Inc. (JOSCO), a Minnesota corporation; Norwest Bank Minneapolis (Bank); I.S. Joseph Shipping Co, Ltd. (Shipping), a Bahamian corporation; and Burton M. Joseph (Joseph).
The plaintiffs own ocean-going vessels which they chartered in 1981 to defendant Shipping, for use in international maritime trade. In late summer 1981, Shipping became insolvent. It failed to pay the $10,000,000 rent due on the charter agreements. In early September 1981, a representative from Shipping and a representative from JOSCO, met in Europe with representatives of the plaintiffs, Lista, Polycrest, Lauritzen and Scout. At these meetings the parties tried to negotiate a settlement.
Shipping's parent company, JOSCO, a Minnesota corporation which wholly owns Shipping, invited various representatives of the plaintiffs to come to Minneapolis to work out an arrangement regarding the default. A meeting was conducted at JOSCO's Minneapolis offices in September 1981. During the next few weeks, settlement meetings were conducted in London and Europe. From September to December 1981 both sides communicated extensively via telex and telephone. When the negotiations initiated by Shipping and JOSCO failed to resolve Shipping's default, plaintiffs commenced this action in the Hennepin County District Court.
JOSCO, Shipping, and Joseph (appellants in this action) counterclaimed against the plaintiffs. They also named as additional defendants on the counterclaim three additional corporations, Nordisk, a legal defense firm, Mosvolds, and Rasmussen, along with various officers and representatives of all the firms. The additional defendants on the counterclaim are the respondents in this action.
The additional defendants on the counterclaim (respondents) successfully moved for dismissal of appellants' counterclaim for failure of service of process and lack of personal jurisdiction.
Did the trial court err by dismissing the counterclaim due to lack of personal jurisdiction over the respondents?
There are two hurdles appellants must surmount to establish personal jurisdiction, statutory and constitutional. Appellants claim that the foreign corporations transacted business in Minnesota, subjecting them to jurisdiction under Minn.Stat. Sec. 543.19, subd. 1(b) (1980). They also claim the individuals who attended the September meeting committed acts in Minnesota causing injury or property damage under Minn.Stat. Sec. 543.19, subd. 1(c) (1980), by violating the Minnesota Antitrust law, Minn.Stat. Secs. 325D.49-66 (1980).
The more substantial question is whether there are sufficient jurisdictional contacts to permit the maintenance of this counterclaim. Appellants allege respondents had sufficient contacts with Minnesota to authorize personal jurisdiction under the Minnesota long arm statute, Minn.Stat. Sec. 543.19 (1980). Minnesota interprets its long arm statute to extend personal jurisdiction in its courts to the limits of the due process clause of the fourteenth amendment. Mid-West Medical, Inc. v. Kremmling Medical-Surgical Associates, 352 N.W.2d 59, 60 (Minn.Ct.App.1984), ( citing Toro Co. v. Ballas Liquidating Co., 572 F.2d 1267, 1269 (8th Cir.1978)).
Due process requires sufficient minimum contacts between the nonresident defendant and the forum state so that the exercise of jurisdiction complies 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).
Defendant's conduct and connection with the forum state must be 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).
To determine jurisdiction over nonresidents, Minnesota uses the five part test developed in Aftanase v. Economy Baler Co., 343 F.2d 187, 197 (8th Cir.1965). The test investigates: (1) the quantity of contacts; (2) the nature and quality of contacts; (3) the source and connection of those contacts to the cause of action; (4) the interest of the forum state; and (5) the convenience of the parties.
This court recently discussed the requirements for the constitutional exercise of jurisdiction over nonresidents who are parties to contracts with Minnesota residents in Mid-West Medical, Inc., 352 N.W.2d at 60. There, the court indicated that since the World-Wide Volkswagen decision, courts tend to require greater contacts before finding personal jurisdiction. In Dent-Air, Inc. v. Beech Mountain Air Service, Inc., 332 N.W.2d 904 (Minn.1983), the court did not grant jurisdiction where an out-of-state lessee of three airplanes was not an active party in creating the first lease and took delivery of aircraft outside...
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