National Business Brokers, Ltd. v. Jim Williamson Productions, Inc.

F I L E D
United States Court of Appeals
Tenth Circuit
UNITED STATES COURT OF APPEALS
AUG 14 2001
FOR THE TENTH CIRCUIT
PATRICK FISHER
Clerk

NATIONAL BUSINESS BROKERS,
LTD., a Colorado Limited Partnership,

Plaintiff-Appellant,
No. 00-1411
v. (D.C. No. 00-WY-419-CB)
(D. Colo.)
JIM WILLIAMSON PRODUCTIONS,
INC., a Louisiana Corporation; JIM
WILLIAMSON, an individual; KEVIN
BRILEY, an individual; MARGORIE
BRILEY, an individual,

Defendants-Appellees.

ORDER AND JUDGMENT *

Before HENRY , ANDERSON , and MURPHY , Circuit Judges.

After examining the briefs and appellate record, this panel has determined

unanimously to grant the parties’ request for a decision on the briefs without oral

argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case is therefore

ordered submitted without oral argument.

*
This order and judgment is not binding precedent, except under the
doctrines of law of the case, res judicata, and collateral estoppel. The court
generally disfavors the citation of orders and judgments; nevertheless, an order
and judgment may be cited under the terms and conditions of 10th Cir. R. 36.3.
 In this diversity case, plaintiff National Business Brokers, Ltd. (NBB) is

appealing the district court’s dismissal of its claims against defendants Jim

Williamson (Williamson) and Jim Williamson Productions, Inc. (JWP) for lack of

personal jurisdiction. See Nat’l Bus. Brokers, Ltd. v. Jim Williamson Prods., Inc. ,

115 F. Supp. 2d 1250 (D. Colo. 2000). Our jurisdiction arises under 28 U.S.C.

§ 1291. We affirm.

I. Background

NBB is a business broker. NBB’s principal place of business is located in

Colorado. Williamson is a citizen and resident of Louisiana. Williamson is a

shareholder and the president of JWP. JWP is a Louisiana corporation, and its

principal place of business is located in Louisiana.

In May of 1998, NBB obtained the commercial listing for the sale of JWP’s

wholly owned subsidiary, Educational Video Resources (EVR). NBB sent the

listing agreement to JWP in Louisiana, and Williamson signed the agreement in

Louisiana on behalf of JWP. The parties also negotiated a revised listing

agreement. Williamson conducted all of the negotiations for the original and

revised listing agreements on behalf of JWP, and neither Williamson nor any

other representative of JWP traveled to Colorado in connection with the

negotiations over the listing agreements or for any other reason. However,

between April and October, 1999, Williamson contacted NBB in Colorado by

-2-
telephone, facsimile, or e-mail on at least sixty occasions requesting information

and services pursuant to the terms of the listing agreements.

Defendants Kevin and Margorie Briley contacted NBB in September of

1999 to inquire about the sale of EVR. NBB put the Brileys in contact with

Williamson after they signed a contract agreeing that all negotiations for the

purchase of EVR would be conducted exclusively through NBB. NBB alleges

that Williamson and JWP subsequently sold EVR to the Brileys for approximately

$1.45 million and that Williamson and the Brileys excluded it from the sales

negotiations. NBB further alleges that neither JWP nor Williamson paid it the

eight percent sales commission it was due under the listing agreements. Although

the Brileys resided in Colorado at the time they initially contacted NBB, they

were residing in Louisiana at the time they purchased EVR, and the entire sales

transaction occurred in Louisiana.

NBB brought this diversity action to recover the damages it has allegedly

sustained as a result of the sale of EVR to the Brileys. In its original complaint,

NBB named only Williamson and the Brileys as defendants, and it asserted claims

against Williamson for breach of contract, promissory estoppel, unjust

enrichment, civil conspiracy, and tortious interference with contract. Pursuant to

Fed. R. Civ. P. 12(b)(2), Williamson filed a motion to dismiss NBB’s complaint

for lack of personal jurisdiction. On August 3, 2000, the district court held a

-3-
hearing on the motion to dismiss. Counsel for NBB failed to attend the hearing

even though he admits he received notice of the hearing.

At the beginning of the hearing, counsel for Williamson informed the

district court that, on July 31, 2000, NBB had filed a motion for leave to file a

first amended complaint adding JWP as a defendant. Counsel for Williamson

further informed the court that JWP, like Williamson, did not have sufficient

contacts with the State of Colorado to support personal jurisdiction. After

hearing argument on this issue, the district court determined that Williamson’s

only contacts with Colorado were the e-mails, faxes, and telephone calls that he

had made or sent from Louisiana to Colorado. The court also determined that

JWP’s contacts with Colorado were no greater than Williamson’s. The court

found that such contacts were insufficient to support personal jurisdiction over

either Williamson or JWP, and it granted the motion to dismiss as to both

Williamson and JWP.

Counsel for NBB subsequently filed motions for reconsideration, but the

district court denied the motions and dismissed NBB’s claims without prejudice in

a written order entered on August 31, 2000. In its order, the district court

dismissed NBB’s claims as to both Williamson and JWP on the grounds that:

(1) neither Williamson nor JWP had sufficient minimum contacts with Colorado

for the court to exercise “specific” personal jurisdiction under the Due Process

-4-
Clause of the Fourteenth Amendment, National Business , 115 F. Supp. 2d at

1254-55; (2) any economic injuries suffered by NBB in Colorado were

insufficient to support personal jurisdiction under the tortious conduct provision

of Colorado’s long-arm statute, see C.R.S. § 13-1-124(1)(b), id. at 1255; and (3)

because Williamson was the only individual who acted on behalf of JWP in its

dealings with NBB, and NBB made no showing that JWP had any additional

contacts with Colorado that went beyond Williamson’s contacts, there was no

error in dismissing NBB’s claims against JWP before it was formally made a

party to the case, id. at 1256. The district court subsequently certified its order of

dismissal as a final judgment under Fed. R. Civ. P. 54(b), and this appeal

followed.

II. Analysis

Plaintiff has the burden of proving that personal jurisdiction exists. See

Wenz v. Memery Crystal , 55 F.3d 1503, 1505 (10th Cir. 1995). “Where, as in the

present case, there has been no evidentiary hearing, and the motion to dismiss for

lack of jurisdiction is decided on the basis of affidavits and other written material,

the plaintiff need only make a prima facie showing that jurisdiction exists.” Id.

Further, the allegations in the complaint must be accepted as true, and all factual

disputes in the parties’ affidavits must be resolved in plaintiff’s favor. Id. We

review the district court’s dismissal for lack of personal jurisdiction de novo. Id.

-5-
 “To obtain personal jurisdiction over a nonresident defendant in a diversity

action, a plaintiff must show that jurisdiction is legitimate under the laws of the

forum state and that the exercise of jurisdiction does not offend the due process

clause of the Fourteenth Amendment.” Soma Med. Int’l v. Standard Chartered

Bank , 196 F.3d 1292, 1295 (10th Cir. 1999) (quotation omitted). Thus, the first

step in the analysis is Colorado’s long-arm statute, which permits the exercise of

personal jurisdiction over defendants who either transact business in the state or

commit a tort in the state. See C.R.S. § 13-1-124(1)(a) and (b). However,

because Colorado’s long-arm statute has been construed by the Colorado Supreme

Court as allowing personal jurisdiction to the full extent permitted under federal

law, see Safari Outfitters, Inc. v. Superior Court , 448 P.2d 783, 784 (Colo. 1968),

“[our] analysis collapses into a single inquiry, whether the exercise of personal

jurisdiction over Williamson and JWP comports with due process.” National

Business, 115 F. Supp. 2d at 1253.

“The Due Process Clause protects an individual’s liberty interest in not

being subject to binding judgments of a forum with which he has established no

meaningful ‘contacts, ties, or relations.’” OMI Holdings, Inc. v. Royal Ins. Co. of

Canada , 149 F.3d 1086, 1090 (10th Cir. 1998) (quoting Burger King Corp. v.

Rudzewicz , 471 U.S. 462, 471-72 (1985)). “Therefore, a ‘court may exercise

personal jurisdiction over a nonresident defendant only so long as there exist

-6-
‘minimum contacts’ between the defendant and the forum state.’” Id. (quoting

World-Wide Volkswagen Corp. v. Woodson , 444 U.S. 286, 291 (1980)).

“The ‘minimum contacts’ standard may be met in two ways.” Id. “First, a

court may, consistent with due process, assert specific jurisdiction over a

nonresident defendant ‘if the defendant has ‘purposefully directed’ his activities

at residents of the forum, and the litigation results from alleged injuries that ‘arise

out of or relate to’ those activities.’” Id. at 1090-91 (quoting Burger King , 471

U.S. at 472) (emphasis in original). Second, “[w]here a court’s exercise of

jurisdiction does not directly arise from a defendant’s forum-related activities,”

the court may exercise general jurisdiction over the defendant if he has

“continuous and systematic” general business contacts with the forum state. Id. at

1091 (citations and quotations omitted). NBB concedes that there was no basis

for the district court to exercise general personal jurisdiction over Williamson or

JWP, and the only issue is whether the district court correctly determined that it

did not have specific personal jurisdiction over Williamson or JWP.

Specific personal jurisdiction will only exist where a defendant has

purposefully directed his activities at the forum state, and “purposeful availment

requires actions by the Defendant which create a substantial connection with the

forum state.” Id. at 1092 (quotation omitted). We agree with the district court’s

conclusion that the listing agreements and the telephone, facsimile, and e-mail

-7-
communications initiated by Williamson did not create a substantial connection

between Williamson and JWP and the State of Colorado.

First, “[t]he law is clear that a party does not submit itself to personal

jurisdiction in a distant forum simply by entering into a contract with a party that

resides in that forum.” National Business , 115 F. Supp. 2d at 1254. Second, “it

is well-established that phone calls and letters are not necessarily sufficient in

themselves to establish minimum contacts.” Far W. Capital, Inc. v. Towne , 46

F.3d 1071, 1077 (10th Cir. 1995). Instead, “the exercise of jurisdiction depends

on the nature of those contacts” and “whether they represent an effort by the

defendant to purposefully avail itself of the privilege of conducting activities

within the forum state.” Rambo v. Am. S. Ins. Co. , 839 F.2d 1415, 1418-19 (10th

Cir. 1988) (quotation omitted) (emphasis in original).

NBB has made no showing that Williamson and JWP signed the listing

agreements or initiated the telephone, facsimile, and e-mail communications as

part of a specific or intentional effort to conduct business within the State of

Colorado. To the contrary, beyond the fortuitous fact that NBB’s business was

located in Colorado, Colorado had no specific relationship to the listing

agreements or the process of locating a buyer for EVD. As a result, Williamson

and JWP do not have sufficient minimum contacts with the State of Colorado to

-8-
support personal jurisdiction under federal law. 1
See Soma , 196 F.3d at 1298-99

(holding that British bank’s actions in sending faxes, written communications,

and wire transfers to corporation located in Utah were insufficient to establish

specific personal jurisdiction over bank in Utah where corporation made

unilateral decision to conduct business with British bank and Utah had only

fortuitous role in parties’ relationship).

NBB also claims that the district court erred in refusing to exercise

personal jurisdiction over Williamson and JWP under the tortious conduct

provision of Colorado’s long-arm statute, see C.R.S. § 13-1-124(1)(b). We

disagree. As the district court found, “[a]bsent allegations of tortious activity in

Colorado, exercise of personal jurisdiction under Colorado’s long-arm statute is

permitted only where ‘the injury itself . . . occurred in Colorado.’” National

Business , 115 F. Supp. 2d at 1255 (quoting McAvoy v. Dist. Court , 757 P.2d 633,

635-36 (Colo. 1988)). “Further, the injury in Colorado ‘must be direct, not

consequential and remote.’” Wenz , 55 F.3d at 1508 (quoting Amax Potash Corp.

v. Trans-Resources, Inc. , 817 P.2d 598, 600 (Colo. Ct. App. 1991)). Thus, the

fact that a Colorado resident sustains a loss of profits in Colorado as a result of a

1
Because Williamson and JWP do not have the requisite minimum contacts
with Colorado, we do not reach the second part of the due process inquiry which
involves the determination of whether “the exercise of personal jurisdiction over
the defendant offends ‘traditional notions of fair play and substantial justice.’”
OMI , 149 F.3d at 1091 (quotation omitted).

-9-
tort that occurred elsewhere is insufficient to sustain long-arm jurisdiction under

the Colorado statute. Id.

NBB alleges that Williamson, acting on behalf of JWP, engaged in a civil

conspiracy with the Brileys and tortiously interfered with its contracts. It is

undisputed that Williamson’s alleged tortious conduct occurred in Louisiana

where the sale of EVR took place. Further, while NBB, by losing out on its

commission, may have suffered an adverse economic impact in Colorado in the

form of a loss of profits, the actual injury occurred in Louisiana where the sale of

EVR occurred. See id. (holding that while defendants’ unauthorized dispersal of

funds from Colorado plaintiff’s trust account in England had economic impact on

plaintiff in Colorado, the injury occurred in England where trust account was

located). Accordingly, we agree with the district court that Williamson and JWP

are not subject to personal jurisdiction under the tortious conduct provision of

Colorado’s long-arm statute. See id. (“That [plaintiff] may be economically

impacted in Colorado, simply because he lives there, is insufficient to establish

personal jurisdiction under [the tortious conduct provision] of the Colorado long-

arm statute”); accord Amax Potash , 817 P.2d at 600.

Finally, the district court did not err in dismissing the claims against JWP

before it was formally made a party to the case. Williamson was the only

individual who acted on behalf of JWP in its dealings with NBB, and NBB has

-10-
made no showing that JWP had any additional contacts with Colorado that went

beyond Williamson’s contacts. Thus, the same set of factual allegations apply to

both Williamson and JWP for purposes of resolving the personal jurisdiction

issues, and the district court acted properly in dismissing the claims against both

before JWP was formally made a party to the case.

The judgment of the United States District Court for the District of

Colorado is AFFIRMED.

Entered for the Court

Stephen H. Anderson
Circuit Judge

-11-