Mayfran v. Eco-Modity

[Cite as Mayfran v. Eco-Modity, 2019-Ohio-4350.]
COURT OF APPEALS OF OHIO
EIGHTH APPELLATE DISTRICT
COUNTY OF CUYAHOGA
MAYFRAN INTERNATIONAL, :
INCORPORATED,
:
Plaintiff-Appellant, No. 107959
:
v.
:
ECO-MODITY, L.L.C.,
:
Defendant-Appellee.
JOURNAL ENTRY AND OPINION
JUDGMENT: REVERSED AND REMANDED
RELEASED AND JOURNALIZED: October 24, 2019
Civil Appeal from the Cuyahoga County Court of Common Pleas
Case No. CV-18-895669
Appearances:
Ulmer & Berne, L.L.P., Lawrence D. Pollack, and Richard
G. Hardy, for appellant.
Tucker Ellis, L.L.P., Laura Kingsley Hong, and Brendan P.
Kelley, for appellee.
MICHELLE J. SHEEHAN, J.:
Mayfran International Incorporated (“Mayfran” hereafter) appeals
from the trial court’s judgment granting the motion to dismiss for lack of personal
jurisdiction filed by Eco-Modity, L.L.C., d.b.a. Blue Marble Material, (“Blue Marble”
hereafter). Mayfran raises the following assignment of error for our review:
1. The trial court erred in dismissing this case for lack of personal
jurisdiction holding that exercising jurisdiction over defendant Eco-
Modity L.L.C. would violate defendant’s due process rights.
After a de novo review, we find merit to the appeal and reverse the trial
court’s judgment granting Blue Marble’s motion to dismiss for lack of personal
jurisdiction. As we explain in the following, Mayfran established a prima facie
showing that Ohio’s long-arm statute confers upon the trial court personal
jurisdiction over Blue Marble and its exercise of jurisdiction does not offend
traditional notions of fair play and substantial justice.
Substantive Facts and Procedural History
The facts in this case are largely undisputed. Blue Marble is a
California business operating several mattress recycling facilities in that state.
Mayfran is a process engineering company in Ohio. It designs, manufactures, and
sells a variety of industrial products, including recycling equipment.
In June, 2015, Tchad Robinson, the president of Blue Marble,
travelled to Las Vegas to attend Waste Expo, a trade show. While there, he met Kim
Jaker, president of H. West Equipment, a company selling recycling equipment and
a distributor of Mayfran equipment. Robinson talked to Jaker about Blue Marble’s
plan to automate its recycling facilities.
Several weeks after the trade show, Jaker told Robinson about
Mayfran and suggested Mayfran may be able to help Blue Marble with automating
its recycling process. In August 2015, Jaker and a team of Mayfran representatives
went to Blue Marble’s headquarter in Commerce, California. They presented a
proposal for Mayfran to design and install a significant part of the recycling process
at Blue Marble’s facilities.
From October 2015 to May 2017, the two companies engaged in
contract negotiations, negotiated primarily by way of email communications and
telephone calls. Robinson visited Mayfran once, in 2017. As a result of the extensive
negotiations over the course of 19 months, Blue Marble and Mayfran executed a total
of ten contracts totaling $8 million. Under the contracts, Mayfran would design and
manufacture for Blue Marble an automated recycling system, consisting of 50 pieces
of equipment, to be installed at Blue Marble’s recycling facilities in California.
Among the 50 pieces of equipment, many were custom-designed for Blue Marble
and manufactured in Ohio. In addition to the design, manufacturing, and
installation of the equipment, Mayfran was involved in the concrete and electrical
work at one of Blue Marble’s facilities.
Subsequently, disputes arose regarding the performance of the
automated system and Blue Marble’s failure to pay under the contracts. In April
2018, Mayfran filed a complaint against Blue Marble in the Cuyahoga County Court
of Common Pleas, raising claims of breach of contract and unjust enrichment and
seeking more than $6 million in unpaid contract price.1 Blue Marble filed a motion
to dismiss for lack of personal jurisdiction. Without a hearing, the trial court granted
the motion, holding that although Ohio’s long-arm statute confers personal
jurisdiction over Blue Marble, exercising jurisdiction in this case would offend the
notions of fair play and substantial justice in violation of the nonresident
defendant’s due process rights.
Standard of Review
We review de novo the trial court’s decision granting a
Civ.R. 12(B)(2) motion to dismiss for lack of personal jurisdiction. Alpha
Telecommunications, Inc. v. ANS Connect, 8th Dist. Cuyahoga No. 90173,
2008-Ohio-3069, ¶ 9.
It is rudimentary that in order to enter a valid judgment a court must
have personal jurisdiction over the defendant. Maryhew v. Yova, 11 Ohio St. 3d 154,
156, 464 N.E.2d 538 (1984). It is the plaintiff who has the burden to establish the
court’s personal jurisdiction over the defendant by a preponderance of evidence.
Giachetti v. Holmes, 14 Ohio App. 3d 306, 307, 471 N.E.2d 165 (8th Dist.1984).
However, when the trial court decides the issue of personal jurisdiction without a
hearing, as here, the plaintiff need only make a prima facie showing of personal
jurisdiction to withstand a motion to dismiss, Giachetti at 307, although the burden
1 After the complaint was filed, Blue Marble removed the case to the United States
District Court for the Northern District of Ohio based on diversity jurisdiction. The
federal court remanded the case back to the common pleas court.
remains on the plaintiff to establish personal jurisdiction by a preponderance of
evidence. State ex rel. DeWine v. 950 Group L.P., 2012-Ohio-3339, 977 N.E.2d 112,
¶ 15 (9th Dist.) (“[W]here the trial court decides personal jurisdiction absent an
evidentiary hearing, the plaintiff continues to bear the burden of proving, in its case-
in-chief at trial, existence of facts upon which jurisdiction is based by a
preponderance of evidence.”).
Moreover, we note that when the court resolves the issue of personal
jurisdiction without a hearing, the factual allegations relevant to personal
jurisdiction must be construed in a light most favorable to the plaintiff and the court
should resolve all reasonable competing inferences in their favor. Goldstein v.
Christiansen, 70 Ohio St. 3d 232, 236, 638 N.E.2d 541 (1994). In this case, Blue
Marble requested an evidentiary hearing. However, the trial court resolved the
motion to dismiss without a hearing. Therefore, Mayfran is only required to make
a prima facie showing of personal jurisdiction at this stage of the proceedings and
the factual allegations must be construed in a light most favorable to Mayfran.
Two-Prong Test for Personal Jurisdiction: (1) Long-Arm Statute and
(2) “Minimum Contacts”
The court applies a two-prong test to determine whether it has
personal jurisdiction over a defendant. “First, the court must determine whether the
state’s ‘long-arm’ statute and applicable civil rules confer personal jurisdiction, and,
if so, whether granting jurisdiction under the statute and the rule would deprive the
defendant of the right to due process of law pursuant to the Fourteenth Amendment
to the United States Constitution.” United States Sprint Communications Co. v. K’s
Foods, 68 Ohio St. 3d 181, 183-184, 624 N.E.2d 1048 (1994).
A. First Prong: Long-Arm Statute
Ohio’s long-arm statute, R.C. 2307.382(A)(1), and Civ.R. 4.3(A)(1)
permit a court to exercise personal jurisdiction over a nonresident defendant and
provide for service of process to effectuate that jurisdiction when the cause of action
arises from the nonresident defendant’s “transacting any business in [the] state.”
Goldstein at 235-236.
As the Supreme Court of Ohio emphasized, both the statute and the
rule are broadly worded and permit jurisdiction over any defendant who is
“transacting any business” in Ohio. Kentucky Oaks Mall Co. v. Mitchell’s Formal
Wear Inc., 53 Ohio St. 3d 73, 75, 559 N.E.2d 477 (1990). Quoting Black’s Law
Dictionary (5th Ed.1979), the court in Kentucky Oaks stated the term “transact”
“‘means to prosecute negotiations; to carry on business; to have dealings,’” “‘but it
is a broader term than the word “contract” and may involve business negotiations
which have been either wholly or partly brought to a conclusion.’” (Emphasis sic.)
Id. Whether a defendant has transacted any business in Ohio is determined on the
particular facts of the case. United States Sprint Communications Co. at 185.
In Pharmed Corp. v. Biologics, Inc., 97 Ohio App. 3d 477, 483, 646
N.E.2d 1167 (8th Dist.1994), a Florida company negotiated with an Ohio company
to sell medical beds to the Ohio company. This court, noting the Florida defendant
engaged in negotiations with the Ohio company by mail, telephone, and facsimile,
held that the defendant’s conduct in negotiating and entering into a contract for the
sale of the beds amounts to transacting business within the state of Ohio.
Similarly here, Blue Marble engaged in negotiations with Mayfran, in
Ohio, by telephone and email communication. Construing the notion of
“transacting any businesses” broadly, Kentucky Oaks, we conclude, as the trial court
did, that Blue Marble’s contractual dealing with Mayfran in Ohio constituted
“transacting any business” in Ohio within the meaning of R.C. 2307.382(A)(1) and
Civ.R. 4.3. The trial court is authorized to exercise personal jurisdiction over Blue
Marble under the first prong of the personal jurisdiction analysis.2
B. Second Prong: “Minimum Contacts”
Even when a state’s long-arm statute authorizes personal jurisdiction
over a nonresident defendant, personal jurisdiction of state courts is limited by the
Due Process clause of the Fourteenth Amendment. Bristol-Myers Squibb Co. v.
Superior Court, 582 U.S. __, 137 S. Ct. 1773, 1779, 198 L. Ed. 2d 395 (2017). Under
due process, a court may assert personal jurisdiction over a nonresident defendant
only if the defendant has certain “minimum contacts” with the forum state such that
maintenance of the suit “does not offend traditional notions of fair play and
substantial justice.” Internatl. Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S. Ct.
154, 90 L. Ed. 95 (1945).
2 On appeal, Blue Marble states it does not agree with the trial court’s ruling
regarding the first prong, yet it presents no argument challenging the ruling.
When considering the “minimum contacts” test, we first note that
personal jurisdiction can be either general or specific, depending on the nature of
the contacts the defendant has with the forum state. General jurisdiction is proper
where a defendant’s contacts with the forum state are of a continuous and systematic
nature as to permit the state to exercise personal jurisdiction even if the suit is
unrelated to the defendant’s contacts with the state. Specific jurisdiction applies
when a state exercises personal jurisdiction in a suit arising out of the defendant’s
contacts with the state. Kauffman Racing Equip., L.L.C. v. Roberts, 126 Ohio St. 3d
81, 2010-Ohio-2551, 930 N.E.2d 784, ¶ 46-47. It is undisputed the personal
jurisdiction in this case involves specific jurisdiction.
When evaluating whether subjecting an out-of-state defendant to
jurisdiction would violate the notions of fair play and substantial justice, we apply
“a constitutional standard defined in the broadest terms of ‘general fairness’ to the
defendant.” S. Machine Co., Inc. v. Mohasco Industries, Inc., 401 F.2d 374, 381, 382
(6th Cir.1968). “[T]he constitutional touchstone remains whether the defendant
purposefully established ‘minimum contacts’ in the forum State.” Burger King v.
Rudzewicz, 471 U.S. 462, 474, 105 S. Ct. 2174, 85 L. Ed. 2d 528 (1985).
Over the years, the courts have elaborated on the “minimum contacts”
test set forth in Internatl. Shoe Co. First, the nonresident defendant must
purposefully avail himself of the privilege of acting in the forum state or causing a
consequence in the forum state. Second, the cause of action must arise from the
defendant’s activities there. Finally, the defendant’s acts or consequences caused by
the defendant must have a substantial enough connection with the forum state to
make the exercise of jurisdiction over the defendant reasonable. S. Machine Co. at
381. The first two requirements concern whether the non-resident defendant had
“minimum contacts” with the forum state. The third requirement ensures that the
contact is sufficiently substantial to make the jurisdiction over the defendant
reasonable. We analyze these requirements in turn.
a. “Purposeful Availment” and “Arising From” Requirements
“Purposeful availment” occurs when “the defendant’s contacts with
the forum state ‘proximately result from actions by the defendant himself that create
a “substantial connection” with the forum state.’” (Emphasis sic.) Kauffman, 126
Ohio St. 3d 81, 2010-Ohio-2551, 930 N.E.2d 784, at ¶ 51, quoting Burger King at
475. This requirement ensures that a defendant “will not be haled into a jurisdiction
solely as a result of ‘random,’ ‘fortuitous,’ or ‘attenuated’ contacts.” Id. quoting
Burger King at 475. Among the considerations for the “purposeful availment”
requirement is whether the nonresident defendant has created continuing
obligations between himself and residents of the forum. Goldstein, 70 Ohio St. 3d
232, 236, 638 N.E.2d 54, at 237.
As for the “arise from” requirement, it simply ensures that “a
defendant’s contacts with the forum state are related to the operative facts of the
controversy.” Kauffman ¶ 70, citing CompuServe, Inc. v. Patterson, 89 F.3d 1257,
1267 (6th Cir.1996). This element only requires that the cause of action have a
substantial connection with the defendant’s activities in the forum state. Kauffman
at ¶ 70
b. Analysis of “Purposeful Availment” and “Arising From” in this
Case
In arguing that it did not purposefully avail itself the privilege of
acting in Ohio, Blue Marble emphasizes its lack of physical presence in Ohio and
lack of any other connection with the state of Ohio, noting that during the entire
course of their relationship, Blue Marble was present in Ohio once when its
president Robinson visited Mayfran sometime in 2017 on his way to a family funeral
in Pennsylvania.
In modern commerce, interstate contracts are often negotiated and
executed primarily through email communication and other electronic media.
Regarding a nonresident defendant’s lack of physical presence in the forum state,
the United States Supreme Court has long rejected the notion that physical contacts
are required for purposes of “minimum contacts.” It stated:
it is an inescapable fact of modern commercial life that a substantial
amount of business is transacted solely by mail and wire
communications across state lines, thus obviating the need for physical
presence within a State in which business is conducted. So long as a
commercial actor’s efforts are “purposely directed” toward residents of
another State, we have consistently rejected the notion that an absence
of physical contacts can defeat personal jurisdiction there.
Burger King, 471 U.S. at 476, 105 S. Ct. 2174, 85 L. Ed. 2d 528.
In Ricker v. Fraza/Forklifts of Detroit, 160 Ohio App. 3d 634,
2005-Ohio-1945, 828 N.E.2d 205 (10th Dist.), an Ohio consultant sued a Michigan
company for a breach of contract. The Tenth District, applying the Burger King
rationale, determined that the Ohio court could exercise personal jurisdiction over
the Michigan defendant, despite the defendant’s lack of physical presence in Ohio.
The court reasoned that the Michigan company had a continuous business
relationship with the plaintiff over a significant period of time and that electronic
and telephone communication was frequently addressed to the plaintiff’s office in
Ohio. Id. at ¶ 18.
Similarly, Blue Marble’s lack of physical presence in Ohio is not
dispositive on the issue of personal jurisdiction and does not preclude jurisdiction.
Rather, we look to the scope and nature of the parties’ contractual activities. Blue
Marble argues that the mere purchase of goods by an out-of-state buyer is
insufficient to establish that the buyer purposefully availed himself of the privilege
of acting in the forum state. Blue Marble is correct that the mere existence of a
contract for a single purchase of goods involving an Ohio seller may not in itself
establish the requisite “minimum contacts.” See Austin Miller Am. Antiques, Inc. v.
Cavallaro, 10th Dist. Franklin No. 11AP-400, 2011-Ohio-6670, ¶ 10 (there was no
minimum contacts for the trial court to exercise jurisdiction over a nonresident
defendant who purchased a chandelier from an Ohio seller — the parties contracted
for a single consumer purchase and the contract did not impose ongoing obligations
to be performed in Ohio).
This case, however, goes beyond a single purchase of goods from an
Ohio company. The transaction here involved extensive negotiations over almost
two years between Blue Marble and an Ohio company, resulting in the execution of
ten contracts totaling more than $8 million in contract price, under which the Ohio
company would deliver to Blue Marble 50 pieces of equipment, many of which
designed and manufactured in Ohio specifically for Blue Marble.
In other words, unlike Austin Miller, this case does not simply involve
a transaction where a nonresident defendant purchased some goods from Ohio.
Rather, Blue Marble entered into multiple contracts with an Ohio company after
extensive negotiations over a significant period of time. Given the nature and scope
of the parties’ contractual relationship, we cannot say Ohio’s jurisdiction over Blue
Marble was a result of Blue Marble’s random, fortuitous, or attenuated contacts with
Ohio. Rather, the nature and scope of the parties’ contractual relationship
demonstrates a prima facie showing that Blue Marble purposefully availed itself of
the privilege of acting in Ohio, albeit through nonphysical contacts.
Blue Marbles cites Walden v. Fiore, 571 U.S. 277, 134 S. Ct. 1115, 188
L. Ed. 2d 12 (2014), for the proposition that the plaintiff cannot be the only link
between the defendant and the forum state and that a defendant’s relationship with
the plaintiff, standing alone, is insufficient basis for jurisdiction. In Walden, a
Georgia Drug Enforcement Administration agent searched two Nevada residents
passing through a Georgia airport and seized cash from them. The Nevada residents
later sued the Georgia agent in a federal court in Nevada, alleging the agent falsified
an affidavit to support the forfeiture of their money. The United States Supreme
Court found that the Nevada court lacked personal jurisdiction over the Georgia
agent, reasoning that the “minimum contacts” analysis “looks to the defendant’s
contacts with the forum State itself, not the defendant’s contacts with persons who
reside there” and that “the plaintiff cannot be the only link between the defendant
and the forum.” Id. at 285. The court concluded the Georgia defendant’s conduct
occurred entirely in Georgia and the mere fact that his conduct affected the plaintiffs
who resided in Nevada does not suffice to authorize jurisdiction. Id. at 291.
The circumstances in Walden are in sharp contrast to the instant case.
In Walden, the claim of personal jurisdiction was based on a random, fortuitous,
and attenuated contact the nonresident made with the forum state by interacting
with persons affiliated with that state. Id. at 286. Here, what connects Blue Marble
to Ohio is not Mayfran’s residency in Ohio alone, but rather Blue Marble’s activities
in Ohio: engaging in significant contractual activities in Ohio (albeit by way of email
and telephone communication) over an extensive period of time.
Turning now to the “arising from” requirement, this is a lenient
requirement and plaintiff simply needs to show the defendant’s contacts with the
forum state are related to the “operative facts of the controversy.” Kauffman, 126
Ohio St. 3d 81, 2010-Ohio-2551, 930 N.E.2d 784, at ¶ 70. In this case, once we have
determined that a prima facie showing has been made that Blue Marble had
“minimum contacts” with Ohio based on its extensive contractual activities with an
Ohio company, it follows that the operative facts of the controversy in this breach of
contract action are related to those contacts.
When analyzing this requirement, the trial court here, in considering
whether the operative facts of the controversy “arise from” the defendant’s contacts
with Ohio, reasoned that Blue Marble’s failure to pay had no direct connection to
Ohio and therefore did not “arise from” its contacts with Ohio. The trial court’s
reasoning is misguided. The operative facts here are the parties’ contractual
activities, not the defendant’s nonpayment.
Given the course of dealing between Blue Marble and Mayfran, we
conclude a prima facie showing has been made that Blue Marble purposefully
availed itself of the privilege of acting in Ohio and the cause of action arose from its
activities in Ohio. The first two requirements of the “minimum contacts” test are
satisfied in this case.
c. Reasonableness
The last requirement of the “minimum contacts” test concerns
whether the acts of the nonresident defendant or consequences caused by that
defendant in the forum state had a substantial connection with the forum state to
make the exercise of jurisdiction reasonable. When the first two requirements of the
“minimum contacts” test are met, there is generally an inference that the exercise of
personal jurisdiction over the nonresident defendant is reasonable. MAG IAS
Holdings, Inc. v. Schmückle, 854 F.3d 894, 903-904 (6th Cir.2017). Several factors
are relevant here: “(1) the burden on the defendant; (2) the interest of the forum
state; (3) the plaintiff’s interest in obtaining relief; and (4) other states’ interest in
securing the most efficient resolution of the controversy.” Intera Corp. v.
Henderson, 428 F.3d 605, 618 (6th Cir.2005).
Regarding the burden on the defendant, this court has observed that
“it has long been recognized that modern transportation and communications have
made it much less burdensome for a party to defend a lawsuit in a state where he
engages in economic activity.” Pharmed Corp., 97 Ohio App. 3d at 485, 646 N.E.2d
1167, citing Kentucky Oaks, 53 Ohio St. 3d at 75, 559 N.E.2d 477. Here, while the
equipment at issue and some witnesses are located in California, an equal number
(or more) of witnesses (Mayfran’s employees involved in this extensive project) are
located in Ohio. The burden on Blue Marble in litigating this matter in Ohio, relative
to the burden on Mayfran in litigating the matter in California, does not necessarily
weigh against jurisdiction.
Regarding California’s and Ohio’s interests in adjudicating this
matter, the trial court below emphasized that Blue Marble operates the mattress
recycling facilities under the California’s mattress recycling statute and therefore
California has a greater interest in adjudicating the instant dispute. We disagree.
Blue Marble has not demonstrated any impact of California’s mattress recycling
statute in this contract action. Rather, the dispute here involves Blue Marble’s
contracts for equipment with Mayfran and its alleged breach of contract. Ohio has
a strong interest in adjudicating a suit brought by an Ohio resident and in seeing
that its residents get the benefit of their bargains. Barnabas Consulting Ltd. v.
Riverside Health Sys., 10th Dist. Franklin No. 07AP-1014, 2008-Ohio-3287, ¶ 26.
Accordingly, we are unable to conclude an Ohio court’s exercise of personal
jurisdiction over Blue Marble is unreasonable.
Based on the particular facts of this case, we conclude that the trial
court’s assertion of personal jurisdiction does not offend traditional notions of fair
play and substantial justice. Mayfran has met its prima facie burden of establishing
the trial court’s personal jurisdiction over Blue Marble under Ohio’s long-arm
statute and the “minimum contacts” test. Our decision does not reach a
determination whether Mayfran established personal jurisdiction by a
preponderance of the evidence because the only issue before the court is the trial
court’s order dismissing this matter pursuant to Civ.R. 12(B).
Finally, regarding the existence of a forum selection clause, it is
disputed by the parties whether there is a valid forum selection clause in the parties’
contracts. In this connection, we note that a party may always waive the due process
rights and consent to personal jurisdiction. One way to consent to personal
jurisdiction of a particular court is through a forum selection clause. See Intrasee,
Inc. v. Ludwig, 9th Dist. Lorain Nos. 10CA009916 and 11CA010024, 2012-Ohio-
2684, ¶ 7. In this case, we do not need to reach the issue of whether a valid forum
selection clause existed, given our conclusion that the exercise of personal
jurisdiction by an Ohio court does not violate Blue Marble’s due process rights.
The trial court’s judgment is reversed, and the matter is remanded to
the trial court for further proceedings consistent with this opinion.
It is ordered that appellant recover from appellee costs herein taxed.
The court finds there were reasonable grounds for this appeal.
It is ordered that a special mandate issue out of this court directing the
common pleas court to carry this judgment into execution.
A certified copy of this entry shall constitute the mandate pursuant to Rule 27
of the Rules of Appellate Procedure.
___________________________
MICHELLE J. SHEEHAN, JUDGE
EILEEN T. GALLAGHER, J., CONCURS;
MARY EILEEN KILBANE, A.J., DISSENTS (WITH SEPARATE OPINION
ATTACHED)
MARY EILEEN KILBANE, A.J., DISSENTING:
I respectfully dissent. I would affirm the trial court’s judgment
granting Blue Marble’s motion to dismiss for lack of personal jurisdiction. I agree
with the trial court in that Mayfran failed to demonstrate “minimum contacts” by
Blue Marble.
With regard to purposeful availment, the first requirement of the
minimum contacts test, I respectfully disagree from the majority opinion’s finding
that Blue Marble’s contractual relationship and email and telephone
communications connect it to Ohio.3 I would find that the parties’ course of dealings
I would also find the majority’s reliance on Ricker, 160 Ohio App. 3d 634,
3
2005-Ohio-1945, 8285 N.E.2d 205, factually distinguishable. In Ricker, the court
presumed that the Michigan company initiated the parties’ contacts in Ohio.
demonstrate the opposite — that Blue Marble’s contact with Mayfran is fortuitous
and random and, as a result, Blue Marble did not purposefully avail itself of the
privilege of acting in Ohio.
Blue Marble did not reach into Ohio to solicit business from Mayfran.
Rather, Blue Marble happened to meet Kim Jaker of H. West Equipment, Inc.
(Mayfran’s California-based subcontractor) at a conference in Las Vegas, Nevada.
Kim Jaker then connected Blue Marble with Mayfran. Thereafter, Mayfran traveled
to California to secure Blue Marble’s business. Mayfran then assigned a California-
based regional manager to handle the account. Blue Marble communicated with the
Mayfran representative in southern California for all of the relevant contracts at
issue. The purpose of these contracts was to facilitate Blue Marble’s business of
recycling mattresses in California under California’s Used Mattress Recovery and
Recycling Act.
Based on the foregoing, I would find that Blue Marble did not reach
out to Ohio and create a connection in a way that would satisfy the purposeful
availment requirement.
As for the “arising from” requirement, the operative facts of the
controversy must arise from the defendant’s contacts with the state. Kauffman, 126
Ohio St. 3d 81, 2010-Ohio-2551, 930 N.E.2d 784, at ¶ 70, citing CompuServe, Inc.,
89 F.3d at 1267. In the instant case, the operative facts of this controversy are that
Additionally, the Michigan company submitted a physical payment in the plaintiff’s Ohio
office. These facts are not present in the instant case.
Blue Marble failed to pay for goods and services forming the basis for breach of
contract and unjust enrichment claims. Blue Marble’s failure to pay, however, has
no direct connection to Ohio and does not arise from Blue Marble’s contact with the
state. The money is owed for goods and services provided in California. Without
such contacts, Mayfran cannot establish the “arising from” requirement of the
minimum contacts test.
With regard to the last requirement, substantial connection, courts
may evaluate a variety of factors, including the forum state and plaintiff’s interests
in proceeding in the chosen forum. Here, the trial court took judicial notice of the
fact that Blue Marble was solely interested in conducting business in California
under California law. The state of California has a far greater interest in adjudicating
this dispute based upon the law it has enacted. Moreover, it is clear that Blue Marble
is based and only conducts business in California. Its facilities are in California, and
the services Mayfran performed were rendered in California. Aside from Mayfran’s
Ohio-based witnesses, all of the evidence is located in California, including
Mayfran’s California regional manager and its California-based subcontractor, as
well as the equipment itself, which is the underlying basis of this dispute.
For these reasons, I would find that exercising jurisdiction over Blue
Marble would be random and arbitrary and would violate the notions of fair play
and substantial justice.
Accordingly, I would affirm the trial court’s judgment granting Blue
Marble’s motion to dismiss for lack of personal jurisdiction.