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Fredin Brothers, Inc. v. Anderson

United States District Court, D. Minnesota

December 20, 2019

FREDIN BROTHERS, INC. doing business as FREDIN BROS, INC., Plaintiff,
v.
KYLE ANDERSON and JASON REED doing business as REED RANCH, Defendants.

          ORDER ON DEFENDANTS' MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION OR, IN THE ALTERNATIVE, TO TRANSFER

          Nancy E. Brasel United States District Judge

         In June 2019, Fredin Brothers, Inc. (“Fredin”) brought a breach of contract suit against Kyle Anderson and Jason Reed in Minnesota state court. [ECF Nos. 1-1, 1-2.] Defendants Anderson and Reed removed the suit to federal court. [ECF No. 1.] They then moved to dismiss the suit for lack of personal jurisdiction or, in the alternative, to transfer the case to Texas. [ECF No. 7.] This Court determines it has no personal jurisdiction over the defendants and grants the motion to dismiss.

         BACKGROUND

         Fredin is a Minnesota company that purchases and sells cattle for its customers. [ECF No. 18-1 (“Fredin Aff.”) ¶ 2.] Fredin hires commissioned sales representatives in other states to help conduct its business. (See id. ¶ 3.) In Texas, one of Fredin's representatives is Chad Houck. (Id.) Houck coordinates Texas sales for Fredin, which operates its business from Minnesota headquarters. (See id. ¶¶ 3-6.) Thus, Fredin's employees in Minnesota prepare invoices, communicate with customers, and store records at the headquarters. (See Id. ¶¶ 4, 11-12, 32.)

         Anderson is a resident of Texas who approached Houck in 2017 about using Fredin's services. [ECF No. 10 ¶¶ 2-3; Fredin Aff. ¶ 7.] Anderson then began purchasing cattle from Fredin, including three times in May 2019. [ECF No. 18-10 at 5-7.] All of Anderson's cattle bought from Fredin came from South Carolina, delivered to Anderson in Texas. (Id.)

         Reed is a resident of South Dakota with a cattle ranch in Texas. [ECF No. 11 ¶¶ 2- 4.] He approached Houck in 2016 about buying cattle from and selling cattle to Fredin. (Fredin Aff. ¶¶ 15-17). In February 2019, Reed agreed to buy cattle from Fredin. [ECF No. 18-9.] The cattle came from elsewhere in Texas and was delivered to Reed at his Texas ranch. (Id.)

         The Fredin-Anderson agreements and the Fredin-Reed agreements are simply invoices. They each list the number of cattle, the price, the origin of the cattle, the location of delivery, two stamps certifying the sale, and Fredin's address. [ECF Nos. 18-10 at 5-7; 18-9.]

         At some point after Fredin delivered the cattle to Reed and Anderson, a significant number became sick and died. [ECF No. 12-1 ¶ 15.] Anderson refused to pay Fredin under the contracts. (Fredin Aff. ¶ 22.) Reed claims he agreed with Fredin for Fredin to buy back fifty of the cattle, but Fredin denies this. (Id. ¶ 24.) Fredin recovered some of the sick cattle and transported them to Minnesota. (Id. ¶ 23.)

         Fredin sued Reed and Anderson in Minnesota state court claiming breach of contract and demanding payment. [ECF Nos. 1-1, 1-2.] Neither defendant lives in Minnesota, owns any property in Minnesota, or has visited Minnesota for any reason relevant to this suit. [See generally ECF Nos. 10, 11.] Fredin argues it is nonetheless proper to exercise personal jurisdiction over the defendants because they knew Fredin was a Minnesota corporation, and Fredin's alleged injury occurred in Minnesota and nowhere else.

         ANALYSIS

         To survive a motion to dismiss for lack of personal jurisdiction, a plaintiff must make a prima facie showing of personal jurisdiction. Dakota Indus., Inc. v. Dakota Sportswear, Inc., 946 F.2d 1384, 1387 (8th Cir. 1991). The plaintiff must provide sufficient facts “to support a reasonable inference that the defendant[] can be subjected to jurisdiction within the state.” Wells Dairy, Inc. v. Food Movers Int'l, Inc., 607 F.3d 515, 518 (8th Cir. 2010) (citation omitted) (alteration in original). “The plaintiff's showing must be tested, not by the pleadings alone, but by the affidavits and exhibits presented with the motions and in opposition thereto.” Id. (quotation marks and citation omitted). The Court “must look at the facts in the light most favorable to the nonmoving party and resolve all factual conflicts in favor of that party.” Dakota Indus., 946 F.2d at 1387 (citation omitted).

         A federal court may assert personal jurisdiction over a non-resident defendant only to the extent permitted by the long-arm statute of the forum state and the Due Process Clause of the Fourteenth Amendment. Romak USA, Inc. v. Rich, 384 F.3d 979, 984 (8th Cir. 2004). Minnesota's long-arm statute confers jurisdiction to the full extent of the Due Process Clause, so the Court only needs to consider whether the Court's assertion of jurisdiction comports with due process. See Soo Line R.R. Co. v. Hawker Siddeley Canada, Inc., 950 F.2d 526, 528 (8th Cir. 1991) (citing Rostad v. On-Deck, Inc., 372 N.W.2d 717, 719 (Minn. 1985)).

         The question under due process is whether the non-resident defendant has sufficient “minimum contacts” with the forum state so that maintaining the suit “does not offend traditional conceptions of fair play and substantial justice.” K-V Pharm. Co. v. J. Uriach & CIA, S.A., 648 F.3d 588, 592 (8th Cir. 2011) (quotation marks and citation omitted). These contacts exist when 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 (1980). Unilateral activity of the plaintiff cannot satisfy this requirement. Hanson v. Denckla, 357 U.S. 235, 253 (1958).

         The Eighth Circuit has laid out five factors to determine personal jurisdiction: (1) the nature and quality of the contacts with the forum state; (2) the quantity of the contacts with forum state; (3) the relationship of the cause of action to the contacts; (4) the interest of the forum state in providing a forum for its residents; and (5) the convenience or inconvenience to the parties. K-V Pharm., 648 F.3d at 592. The third factor, the relationship between the cause of action to the contacts, distinguishes general and specific personal jurisdiction, because general jurisdiction “refers to the power of a state to adjudicate any cause of action involving a particular defendant . . . while specific jurisdiction requires that the cause of action arise from or ...


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