Bluetarp Financial, Inc. v. Matrix Construction Co., Inc. ( 2013 )

United States Court of Appeals
For the First Circuit
No. 12-1338
BLUETARP FINANCIAL, INC.,
Plaintiff, Appellant,
v.
MATRIX CONSTRUCTION CO., INC.,
Defendant, Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MAINE
[Hon. George Z. Singal, U.S. District Judge]
Before
Thompson, Selya, and Lipez,
Circuit Judges.
Gavin G. McCarthy, with whom Pierce Atwood LLP was on brief,
for appellant.
Jason P. Donovan, with whom Daniel R. Mawhinney and Thompson
& Bowie, LLP were on brief, for appellee.
March 1, 2013
THOMPSON, Circuit Judge. The sole question presented on
appeal is whether the district court has personal jurisdiction over
the defendant. The district court did not think it did and so
dismissed the complaint. After carefully considering the matter,
we find the requirements for personal jurisdiction have been
satisfied and we reverse.
FACTUAL BACKGROUND
The defendant Matrix Construction Co., Inc. ("Matrix"),
as the name suggests, is in the construction business. It is a
South Carolina corporation with its principal place of business in
Anderson, South Carolina. In 2010, it was hired as the general
contractor for a project involving renovations to three schools in
Anderson. In connection with the project, Matrix solicited bids
from building supply companies. Contract Supply, LLC ("Contract
Supply"), a South Carolina company with its principal place of
business in Mauldin, South Carolina, submitted a bid to supply
hollow metal frames and wooden doors. Matrix accepted the bid; the
quoted price was around $150,000.
At the time, Contract Supply had a relationship with the
plaintiff BlueTarp Financial, Inc. ("BlueTarp"), a company that
provides commercial credit to the construction industry. BlueTarp
is a Delaware corporation with its principal place of business in
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Portland, Maine.1 BlueTarp and Contract Supply had entered into a
contract whereby Contract Supply agreed to provide a BlueTarp
credit application to the contractors it worked with instead of
extending its own in-house credit. And so, after its bid had been
accepted, Contract Supply faxed Matrix a BlueTarp credit
application. The attached fax cover sheet read: "Could you please
complete the following credit app? We need to get your company set
up in our system so we can get started on the shop drawings for the
2 Anderson elementary schools."
The credit application, which called for various bits of
information about the applicant company, indicated that upon
completion it could be returned to the materials dealer (here
Contract Supply), or to BlueTarp via a toll free fax number, email,
or by mail to a P.O. Box in Portland, Maine. The application also
contained a second page titled "BlueTarp Financial Account
1
According to BlueTarp, its principal place of business is in
Portland, Maine and its corporate office is in Charlotte, North
Carolina. Matrix, however, is not convinced that Maine is in fact
the principal office. It points to some of BlueTarp's filings with
various states, including North Carolina, that list the Charlotte,
North Carolina office as being either the "principal executive
office," "main business address," "corporate officers' address," or
"principal office address." For our purposes, applying the
plaintiff-friendly prima facie standard (explained later), BlueTarp
has adequately established that its principal place of business is
in Maine. There is evidence that forty-three of its fifty-three
employees work in the Maine office, including three-quarters of the
managerial level staff. All purchase authorizations, customer
records, billing, communications, and collection efforts go through
the Maine office. BlueTarp's filings with the Maine Secretary of
State, and its filing with the U.S. Securities and Exchange
Commission, list its principal office as being in Portland, Maine.
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Agreement" (the "account agreement"), which laid out the terms and
conditions of the credit relationship. The account agreement
listed BlueTarp's address as 443 Congress Street in Portland,
Maine. It also provided that the agreement would be governed by
the "laws of the State of Maine" and that in the event of default
"BlueTarp may institute suit against you in the courts of the State
of Maine, regardless of where you are geographically located or
conduct business." The account agreement further indicated that
Matrix's use of its BlueTarp account would constitute acceptance of
the agreement's terms and conditions, and that Matrix agreed to be
bound by the account agreement in the event its application was
approved.
Matrix says its policy was to pay for building materials
by check whenever possible and, when credit was needed, to use the
line of credit it had with a bank. Nonetheless, to avoid any
delays, Matrix's office manager completed and signed the credit
application. However, she left the requested credit line blank
because, according to Matrix, it did not intend to purchase
anything using the credit. The application was faxed to Contract
Supply in South Carolina.
Contract Supply forwarded the application to BlueTarp,
which denied it because the application was not signed by a Matrix
corporate officer and because the requested credit line was left
blank. On May 24, 2010, BlueTarp sent a fax to Matrix indicating
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that it could not process the credit application for those reasons.
The fax directed Matrix to resubmit its application to BlueTarp via
fax. One of BlueTarp's employees followed up with Matrix during
the ensuing week by phone and fax asking for a completed
application.
On June 2, Matrix submitted a new application, again
containing the account agreement on the second page. This one was
signed by Matrix's president, H.M. King, Jr., with a requested
credit line of $5,000 (an intentionally limited amount because,
again, Matrix says it never intended to use the credit). Using
BlueTarp's toll free fax number, Matrix faxed the application to
BlueTarp's office in Portland, Maine. The application was approved
that day. On or around June 8, 2010, BlueTarp sent Matrix a
welcome letter. The letter, which listed BlueTarp's address as
being in Maine, indicated that Matrix's initial credit limit was
$10,000 and it provided billing, payment, and online account set-up
information including an account number, sign-on password, and a
purchaser identification number. The second page of the letter was
another copy of the account agreement.
Right around this time, on June 6, 2010, Matrix submitted
its first purchase order to Contract Supply, a $44,134.00 order. A
$51,078.92 order followed on January 14, 2011 and then a $71,880.40
order on May 5, 2011. Contract Supply billed Matrix for the
ordered materials directly, sending a little more than twenty
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invoices from September 2010 to May 2011. Contract Supply's name
and its South Carolina address were listed at the top of each
invoice. Under a box labeled "Terms" on the invoices it said
"BlueTarp." Then at the bottom of each invoice it said "BlueTarp
Customers Only Please Remit to BlueTarp Financial, Inc." and it
provided a P.O. Box located in Atlanta, Georgia.
At the same time, BlueTarp was also billing Matrix from
its Maine office. It was doing this because it was advancing
Contract Supply money as payment for Matrix's purchases.
Specifically, from July 2010 to May 2011, BlueTarp approved
$169,217.58 in charges made on Matrix's BlueTarp credit account.
And so from July 2010 to June 2011, BlueTarp sent Matrix a billing
statement once a month (twelve total). On the billing statements
BlueTarp's address was listed as the P.O. Box in Atlanta, Georgia.
The statements contained Matrix's customer account number, account
summary, account balance, a list of its purchase transactions, its
available credit, and credit limit, among other things. The first
bill reflected Matrix's credit limit as being $10,000. After a
couple of months this climbed to $50,000 and eventually up to a
high of $144,000. Matrix says it never requested or discussed this
increase with BlueTarp.
Matrix elected to pay Contract Supply directly for the
materials. From September 2010 to April 2011 Matrix sent checks
to Contract Supply in South Carolina. Matrix sent eleven checks,
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the payments totaling about $50,500. Matrix never made any
payments to BlueTarp. However, apparently unbeknownst to Matrix,
Contract Supply was forwarding the checks to BlueTarp. Contract
Supply was sending the checks to a bank lockbox that BlueTarp
maintained - this was the Georgia P.O. Box.2 The bank would take
the checks directly from this lockbox and deposit them, regardless
of who was listed as payee, into BlueTarp's account. According to
BlueTarp, because of this arrangement it never saw the checks and
therefore never knew that Matrix was "improperly" making the checks
out to Contract Supply.
During this time (June 2010 to June 2011 to be exact)
Matrix and BlueTarp were intermittently communicating on the phone
and by email. Based on the communication logs that BlueTarp kept
and an accompanying affidavit, it appears there was in the vicinity
of fifteen calls or emails, all of which went through BlueTarp's
Maine office. The bulk of the communications originated from
BlueTarp. There were, however, a couple of emails sent from
Matrix's office manager to BlueTarp; both times she was responding
to a communication from BlueTarp.
In June 2011, Matrix learned that Contract Supply was not
paying its suppliers. As a result, Matrix stopped paying Contract
Supply. It says it did this on the advice of legal counsel to
protect against the risk of double payment to Contract Supply and
2
One check was sent directly to BlueTarp and not the lockbox.
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its suppliers under South Carolina law. On June 15, 2011, a
collections manager from BlueTarp sent Matrix a letter. In it,
BlueTarp conceded that Contract Supply had not paid some of its
suppliers. It went on to say that if Matrix was considering paying
the bilked suppliers directly, such payment would not relieve it of
its obligations to BlueTarp. The letter continued by indicating
that BlueTarp had paid Contract Supply in full for all of Matrix's
purchases and therefore Matrix owed BlueTarp a balance of
$118,201.50.3 Matrix ignored the payment request.
PROCEDURAL BACKGROUND
In July 2011, BlueTarp filed this lawsuit in the United
States District Court for the District of Maine invoking diversity
jurisdiction. See 28 U.S.C. § 1332(a)(1). The complaint, which
included a breach of contract claim and an unjust
enrichment/equitable indemnity claim, alleged that Matrix owed
BlueTarp $121,708.80 for unpaid purchases and interest. Matrix,
the following month, turned around and filed its own lawsuit. It
sued BlueTarp, Contract Supply, and two of Contract Supply's
suppliers in South Carolina state court. The gist of the claim was
that Matrix had never accessed its BlueTarp credit and that it was
Contract Supply, not Matrix, who owed BlueTarp money.
3
Matrix had paid in full all of its charges up to May 2011.
The roughly $118,000 was the amount due in June and July.
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Motion practice followed shortly behind the complaints.
First, BlueTarp moved to dismiss the South Carolina case under
South Carolina Rule of Civil Procedure 12(b)(8) on the basis that
its earlier filed lawsuit in Maine involved the same parties and
claims. A week or so later Matrix moved to dismiss the Maine case
on the following grounds: lack of personal jurisdiction, lack of
subject matter jurisdiction, improper venue, forum non conveniens,
and failure of the unjust enrichment/equitable indemnity claim as
a matter of law.
The South Carolina decision issued first. The court
stayed the case pending the district court of Maine's resolution of
Matrix's motion to dismiss. If jurisdiction was found in Maine,
the South Carolina court said it would dismiss Matrix's complaint;
if not, it would allow the case to go forward.
The federal district court of Maine's decision followed.
It granted the motion to dismiss holding that it lacked personal
jurisdiction over Matrix. It started by saying that the forum
selection clause in the account agreement permitted BlueTarp to
file suit in the state courts of Maine but did not require it. It
then turned to the question of personal jurisdiction, noting first
that general jurisdiction clearly did not exist and that the
operative question was whether there was specific jurisdiction. In
deciding that the answer was no, the court reviewed Matrix's
contacts with Maine and in essence decided that they were too
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tenuous to establish jurisdiction. Because it found personal
jurisdiction lacking, the court did not analyze the other grounds
that Matrix advanced to support dismissal. In a footnote, the
court did however note that BlueTarp had established a basis for
subject matter jurisdiction because it was not clear to any legal
certainty that BlueTarp's claims were worth less than the $75,000
required for diversity jurisdiction.4
BlueTarp appealed the grant of the motion to dismiss to
this court. On appeal, it argues that the forum selection clause
itself authorizes jurisdiction in the Maine district court and, in
the event we disagree with that proposition, that Matrix had
sufficient connections with Maine to satisfy the requirements of
personal jurisdiction. Matrix as would be expected takes the
opposite position on both issues.5
4
As promised, after this decision issued, the South Carolina
state court lifted the stay. As of the time of briefing before
this court, the South Carolina case was in the discovery phase.
Also, though there is nothing in the record about this, Matrix
indicates in its brief that yet another case entered the fray
around this time. Specifically, after the dismissal below,
BlueTarp sued Matrix, in a cause of action nearly identical to this
one, in Maine state court. We take judicial notice that neither
the South Carolina state-court case or the Maine state-court case
has gone to final judgment.
5
Matrix makes alternative arguments in favor of dismissal,
the same ones it advanced below: improper venue, forum non
conveniens, and a legally deficient unjust enrichment/equitable
indemnity claim. Though these arguments were never considered by
the district court, Matrix urges us to affirm the dismissal on
these grounds. We decline to do so.
Additionally, Matrix contends that the district court's
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STANDARD OF REVIEW
When a district court reviews a motion to dismiss under
the prima facie standard, which is what it did here, our review is
de novo.6 Harlow v. Children's Hosp., 432 F.3d 50, 57 (1st Cir.
2005); Foster-Miller, Inc. v. Babcock & Wilcox Canada, 46 F.3d 138,
147 (1st Cir. 1995). Under this prima facie standard, "the inquiry
is whether the plaintiff has proffered evidence which, if credited,
is sufficient to support findings of all facts essential to
personal jurisdiction." Phillips v. Prairie Eye Ctr., 530 F.3d 22,
26 (1st Cir. 2008). The plaintiff's properly documented
evidentiary proffers are accepted as true for purposes of making
the prima facie showing, and we construe these proffers in a light
finding of subject matter jurisdiction (made in passing) was
erroneous. We disagree. It is undisputed that the two parties are
citizens of different states. See 28 U.S.C. § 1332(a). As for the
amount in controversy, it is not obvious that the claim involves
less than the requisite $75,000. See id. BlueTarp's Vice
President of Credit Risk Management completed an affidavit, which
indicates that Matrix did not pay approximately $118,000 in charges
or the resulting late fees and interest. This amount matches up
with BlueTarp's billing statements and its collections letter.
Moreover, Matrix admits it stopped paying. While Matrix may
ultimately be able to argue that BlueTarp should not prevail
because Matrix never paid BlueTarp directly or authorized the
credit increase, at this stage it is not apparent to a legal
certainty that BlueTarp cannot recover the approximately $120,000
it claimed. See St. Paul Mercury Indem. Co. v. Red Cab Co., 303
U.S. 283, 289 (1938); Stewart v. Tupperware Corp., 356 F.3d 335,
338 (1st Cir. 2004).
6
In addition to the prima facie method, courts can apply the
preponderance method or the likelihood method, both of which
typically require an evidentiary hearing. Phillips v. Prairie Eye
Ctr., 530 F.3d 22, 26 n.2 (1st Cir. 2008).
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most favorable to plaintiff's jurisdictional claim. Id. To the
extent that they are uncontradicted, we add into the mix the facts
put forward by the defendant. Cossaboon v. Maine Med. Ctr., 600
F.3d 25, 31 (1st Cir. 2010). The ultimate burden of persuasion is
on the plaintiff. Id.ANALYSIS
In order to subject a defendant who is not present in the
forum state to a personal judgment, the Due Process Clause requires
that the defendant "have certain minimum contacts with [the forum]
such that the maintenance of the suit does not offend traditional
notions of fair play and substantial justice." Int'l Shoe Co. v.
Washington, 326 U.S. 310, 316 (1945) (internal quotation marks
omitted). Personal jurisdiction over a defendant can come in the
form of general or specific jurisdiction. Harlow, 432 F.3d at 57.
For general jurisdiction the defendant must have continuous and
systematic contacts with the forum state, but the particular cause
of action may be unrelated to those contacts. Id. General
jurisdiction "broadly subjects the defendant to suit in the forum
state's courts in respect to all matters," regardless of whether
the matter before the court has anything to do with the defendant's
contacts with the state. Cossaboon, 600 F.3d at 31 (internal
quotation marks omitted). In this way general jurisdiction is
different than specific jurisdiction because specific jurisdiction
depends on an "affiliatio[n] between the forum and the underlying
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controversy." Goodyear Dunlop Tire Operations, S.A. v. Brown, 131
S. Ct. 2846, 2851 (2011) (internal quotation marks omitted)
(alteration in original); see Harlow, 432 F.3d at 57 (holding that
"[f]or specific jurisdiction, the plaintiff's claim must be related
to the defendant's contacts"). There is no claim of general
jurisdiction here; only specific jurisdiction is at issue.
Courts may assert specific jurisdiction over a defendant
when it is permissible under both the forum state's long-arm
statute and the Due Process Clause of the United States
Constitution. Carreras v. PMG Collins, LLC, 660 F.3d 549, 552 (1st
Cir. 2011). Maine's long arm statute extends to the fullest extent
permitted by the Due Process Clause of the Constitution, Me. Rev.
Stat. tit. 14, § 704-A(1); Harlow, 432 F.3d at 57, and so we turn
directly to the constitutional analysis. Specific jurisdiction
analysis under the Due Process Clause has three distinct
components: relatedness, purposeful availment, and reasonableness.
Phillips, 530 F.3d at 27. An affirmative finding on each of these
elements is needed to support a specific jurisdiction finding.
Negrón-Torres v. Verizon Communications, Inc., 478 F.3d 19, 24-25
(1st Cir. 2007).
i. Relatedness
To satisfy the relatedness prong, the cause of action
must arise from or relate to the defendant's contacts with the
forum state. Carreras, 660 F.3d at 554; Phillips, 530 F.3d at 27.
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A consideration in a contract action such as this is whether the
defendant's forum-based activity was instrumental in the contract's
formation or breach. Adelson v. Hananel, 510 F.3d 43, 49 (1st Cir.
2007). Inferences can be drawn from the parties' "prior
negotiations and contemplated future consequences, along with the
terms of the contract and the parties' actual course of dealing."
Platten v. HG Bermuda Exempted Ltd., 437 F.3d 118, 135 (1st Cir.
2006) (internal quotation marks omitted).
BlueTarp filed suit because Matrix allegedly owes it
money based on a relationship that was formed when Matrix sent the
completed credit application (containing the account agreement) to
BlueTarp in Maine. Before this formation there was some back and
forth. First, Matrix's office manager completed the application
leaving the credit line blank. When BlueTarp declined this offer,
the application apparently went up the corporate food chain to
Matrix's president, King, who completed and signed the application
with the requested credit amount and sent it off to Maine. Sending
the application to Maine, the culmination of this back and forth
negotiation, resulted in the formation of the contract and
relationship at issue.7 See, e.g., Phillips, 530 F.3d at 27
7
Matrix does not claim that it is not bound by the account
agreement's terms, nor does it appear that such an argument would
have merit. There is no allegation that King did not have the
authority to enter into the agreement and indeed, as Matrix's
president, we think it safe to assume he did. The language of the
agreement itself indicated that approval of the application meant
that Matrix was bound by the account agreement and Matrix's use of
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(explaining that one factor that typically leads to a relatedness
finding is when an employment contract's specific terms "were
'formalized and entered into' in the forum state" (quoting Adelson,
510 F.3d at 49)).
Besides Maine playing a role in the agreement's
negotiation and formation, the resulting relationship contemplated
the future consequences of Matrix using the credit account and thus
continuing to interact with BlueTarp in Maine. These ramifications
would be bills issuing from Maine, employees in Maine keeping track
of Matrix's purchases and balance, Maine employees making decisions
regarding credit adjustments and limits, and Matrix communicating
with those employees to address any issues that arose (in essence,
to the extent permitted by the account agreement, BlueTarp became
Matrix's payment agent). And, as evidenced by the billing
statements and phone and email communications between the parties,
just such interplay did take place.
Matrix, however, tries to put distance between it and
BlueTarp, emphasizing that it never placed orders with, or made
payments directly to, BlueTarp. While this is true, Matrix did
receive bills from Contract Supply that said Matrix's payment terms
were "BlueTarp" and that directed BlueTarp customers to pay
BlueTarp directly. And Matrix not only received a welcome letter
its BlueTarp account (which Matrix did use) constituted acceptance
of its terms and conditions.
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from BlueTarp but it also received twelve billing statements from
BlueTarp containing Matrix's own assigned customer account number
and demanding payment. If these facts alone do not serve to
convince that Matrix was a BlueTarp customer, and that the parties
were proceeding as such, the account breakdown on the billing
statements makes clear that BlueTarp was handling Matrix's
payments, extending Matrix credit, and keeping track of Matrix's
purchases and use of the credit. Matrix received these BlueTarp
billing statements monthly for a year, putting Matrix on notice
that BlueTarp was performing its bargained-for obligations under
the agreement. Given this monthly reminder, pursuant to the
contractual relationship between the parties, Matrix had a right to
call up BlueTarp at any time and contest the accuracy of the
billing. Further, under the contract, Matrix (who in fact was
communicating with BlueTarp throughout the year) had the express
right to terminate the agreement.8 But it never did. Matrix's
present attempt to disassociate itself from BlueTarp is belied by
its course of conduct and comes too late.
On top of everything else, the very terms of the account
agreement indicated that it would be governed by the laws of Maine
and that Matrix may be sued in the courts of the state of Maine.9
8
The account agreement read: "Either [Matrix] or BlueTarp
Financial may terminate this Agreement at any time."
9
As we mentioned earlier, BlueTarp argues that this forum
selection clause (which to remind the reader provided that
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Thus the state of Maine was tied to the contract's terms, as well
as the parties' interactions and contemplated future consequences,
including the Maine court system's anticipated involvement in the
resolution of any breach.
Given all this, we find this cause of action arises out
of Matrix's Maine contacts. See, e.g., Astro-Med, Inc. v. Nihon
Kohden Am., Inc., 591 F.3d 1, 10 (1st Cir. 2009) (a contract's
choice of law and consent to jurisdiction provisions were some of
the Rhode Island connections the court found sufficient to satisfy
the relatedness prong); Daynard v. Ness, Motley, Loadholt,
Richardson & Poole, P.A., 290 F.3d 42, 61 (1st Cir. 2002) (finding
relatedness when suit arose out of Massachusetts activities that
were instrumental in the contract's formation, including partial
performance of the agreement in Massachusetts along with
contemplated ongoing interaction with the state). Most notably,
faxing the credit application to Maine is what created the contract
that BlueTarp claims was breached.10 See, e.g., Carreras, 660 F.3d
"BlueTarp may institute suit against you in the courts of the State
of Maine,") in and of itself authorizes the district court's
jurisdiction. It contends that the clause means that Matrix
consented to being sued both in Maine state court and the federal
district court of Maine when it is sitting in diversity
jurisdiction. Matrix, on the other hand, along with the district
court, thinks the clause refers only to Maine state courts. We
express no opinion on this disputed point. For present purposes,
it suffices for us to consider the forum selection clause as a
factor in our jurisdictional analysis.
10
Matrix makes much ado of the fact that Contract Supply's and
BlueTarp's billing statements directed Matrix to send payment to
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at 554-55 (holding that the mailing of purchase agreements to
Puerto Rico "played a direct role in the formation of the purchase
agreements at issue" and therefore was "'related' to the dispute").
ii. Purposeful Availment
Specific jurisdiction further requires that the
defendant's contacts "represent a purposeful availment of the
privilege of conducting activities in the forum state, thereby
invoking the benefits and protections of that state's laws and
making the defendant's presence before the state's courts
foreseeable." Hannon v. Beard, 524 F.3d 275, 284 (1st Cir. 2008)
(internal quotation marks omitted). We have called it akin to a
"rough quid pro quo," that is, "when a defendant deliberately
targets its behavior toward the society or economy of a particular
forum, the forum should have the power to subject the defendant to
judgment regarding that behavior." Carreras, 660 F.3d at 555. In
the purposeful availment inquiry the focus is on the defendant's
intentions, id., and the cornerstones are voluntariness and
foreseeability, Hannon, 524 F.3d at 284. The defendant's contacts
BlueTarp at a P.O. Box in Georgia. We do not think this fact is
very significant. Companies undoubtedly often use out of state
banks and may cut out the middleman by having customers send
payments to the bank directly. Even were we to accept Matrix's
argument that because the payments were due in Georgia, the breach
necessarily occurred in Georgia, this would not change our
thinking. Where the breach occurred is just one consideration and,
as we explained, the other factors, including where the contract
was formed and where the parties interacted, favor jurisdiction in
Maine.
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"must be deliberate, and not based on the unilateral actions of
another party." Phillips, 530 F.3d at 28 (internal quotation marks
omitted).
Matrix would have us believe that it was sheer chance it
ended up dealing with a Maine company and that it never
deliberately targeted Maine. However, Matrix's contacts with Maine
were voluntary to the extent that it knowingly entered into a
credit relationship with a company that it knew (it was clear on
the account agreement's face) was located in Maine and it
voluntarily sent the completed agreement to Maine. Though Matrix
alleges that when it entered into the contract it did not intend to
use the credit and it was simply complying with a precondition of
doing business with Contract Supply, this does not change things.
Regardless of whether Contract Supply required all suppliers to
work with BlueTarp, or whether, as BlueTarp suggests, only
customers who wanted to buy on credit had to fill out the
application, Matrix voluntarily completed the application. It did
not refuse or try to negotiate around it.
Of course simply entering into a contract with a company
in the forum state does not automatically establish the requisite
contacts, Adams v. Adams, 601 F.3d 1, 7 (1st Cir. 2010), but here
we have more. First, as we outlined above in our relatedness
analysis, the record makes clear that Matrix not only contracted
with a Maine entity but that it followed through with the
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contract's expectations and actually used BlueTarp's services.
Matrix's contacts with Maine were deliberate and ongoing rather
than simply founded on the one-sided actions of BlueTarp. See
Phillips, 530 F.3d at 28. Second (and very significantly), based
on the choice of law provision and the forum selection clause, it
was eminently foreseeable that Matrix would be held accountable for
any breach in Maine's courts. Compare Burger King Corp. v.
Rudzewicz, 471 U.S. 462, 482 (1985) (finding that a choice of law
provision, combined with the defendant's relationship with the
forum, reinforced the defendant's "deliberate affiliation with the
forum State and the reasonable foreseeability of possible
litigation there"), with Adams, 601 F.3d at 8 (noting that the
absence of a choice of law provision in a promissory note weighed
against a finding that the defendant had purposefully availed
himself of the benefits and protections of Massachusetts law).
This all leaves us convinced that Matrix's contacts with Maine
"were not random, isolated or fortuitous." Hannon, 524 F.3d at 284(internal quotation marks omitted).
iii. Reasonableness
The final piece of the puzzle is that an exercise of
jurisdiction must be reasonable, in other words, consistent with
principles of justice and fair play. Carreras, 660 F.3d at 554;
Phillips, 530 F.3d at 27. A set of "gestalt factors" guides us in
making this determination. N. Laminate Sales, Inc. v. Davis, 403
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F.3d 14, 26 (1st Cir. 2005). These factors include: Matrix's
burden of appearing, the forum state's interest in adjudicating the
dispute, BlueTarp's interest in obtaining convenient and effective
relief, the interstate judicial system's interest in efficient
resolution of the matter, and the common interests of all states in
promoting substantive social policies. See Adelson v. Hananel, 652
F.3d 75, 83 (1st Cir. 2011); N. Laminate Sales, Inc., 403 F.3d at
26 (citing Burger King Corp., 471 U.S. at 477).
Weighing the factors, the balance here tips in favor of
jurisdiction. First, mounting an out-of-state defense most always
means added trouble and cost and therefore, "'this factor is only
meaningful where a party can demonstrate some kind of special or
unusual burden.'" Hannon, 524 F.3d at 285 (quoting Pritzker v.
Yari, 42 F.3d 53, 64 (1st Cir. 1994)). No particular or unique
burden has been shown here.
Second, Maine has an interest in this matter's
resolution. BlueTarp, through its principal place of business,
conducts business in Maine. Maine has an interest in redressing
harms committed against its companies by out-of-state companies,
see N. Laminate Sales, Inc., 403 F.3d at 26, the interest here
being to ensure that an out-of-state entity settles up its supposed
debts. Along these same lines, Maine has a stake in being able to
provide a convenient forum for its slighted residents. See
Adelson, 510 F.3d at 51.
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Also cutting in favor of jurisdiction is BlueTarp's
interest in convenient and effective relief. We have repeatedly
said, "'a plaintiff's choice of forum must be accorded a degree of
deference with respect to the issue of its own convenience.'"
Hannon, 524 F.3d at 285 (quoting Sawtelle v. Farrell, 70 F.3d 1381,
1395 (1st Cir. 1995)). Further, according to BlueTarp, all
relevant documents and potential witnesses are located in Maine.
Fourth, given that there is a lawsuit in South Carolina
state court involving this matter, there is at least a question as
to whether the instant lawsuit serves the interstate judicial
system's interest in efficient resolution. But the existence of
the South Carolina lawsuit, which we note was filed after this one,
is insufficient to tip the constitutional balance. See Adelson,
652 F.3d at 84. Concluding with the final factor, we see no
substantive social policy at issue here.
The district court's exercise of jurisdiction over this
matter is reasonable.
CONCLUSION
Having found the relatedness, purposeful availment, and
reasonableness factors satisfied, we conclude that it has been
established that the district court has personal jurisdiction over
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Matrix. The district court's dismissal of the complaint is
reversed.11
11
Our holding does not preclude the district court from
transferring this case to another venue should it think it
advisable. Pursuant to 28 U.S.C. § 1404(a), a district court may
transfer a case to any other district or division where the case
might have been originally brought, or to which the parties have
consented, in the interest of justice or for the convenience of the
parties and witnesses.
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