Cite as 2013 Ark. App. 679
ARKANSAS COURT OF APPEALS
DIVISION III
No. CV-13-472
JASON PRITCHETT, as President of Opinion Delivered November 13, 2013
COMMODITY RECOVERY
SOLUTIONS, INC., and DON APPEAL FROM THE BENTON
LONGLEY, as President of COUNTY CIRCUIT COURT
IRONWOOD SERVICES, INC. [CV-2012-2269]
APPELLANTS
HONORABLE DOUG SCHRANTZ,
V. JUDGE
ANTHONY EVANS and US
REFINERY, INC.
APPELLEES
REVERSED AND REMANDED
RHONDA K. WOOD, Judge
Appellant, Commodity Recovery Solutions and Ironwood Services (“CRS”),
argues that the circuit court wrongfully determined that Arkansas did not have personal
jurisdiction over Texas resident Anthony Evans. We agree with CRS and reverse the
order dismissing Anthony from the case because CRS alleged facts in its complaint that are
sufficient to establish specific personal jurisdiction over Anthony.
Cite as 2013 Ark. App. 679
I. Facts
CRS sued Anthony Evans for breach of contract and other causes of action. 1 CRS
is an Arkansas corporation, and Anthony is a Texas resident. The complaint asserted that
someone by the name of Jason Evans contacted CRS about extracting the silver from
CRS’s leftover x-ray film. Anthony then called CRS and provided more specific price
quotes for different types of x-rays. At the time, Anthony told CRS that his name was
“Anthony Nichols” and that he was President of Petag, a Houston company that processes
old x-ray film. Anthony called CRS a second time, gave another price quote, and said that
he had arranged for Freightquote.com to pick up CRS’s x-ray film at CRS’s Arkansas
location. A bill-of-lading attached to the complaint showed that Freightquote.com picked
up the x-rays and listed “Anthony” as the contact for the consignee. 2
After the pick-up, Anthony told CRS that he was sending it a check for twenty
percent of the x-ray load. Later, CRS received a cashier’s check for $24,000 that read
“paid in full.” CRS contacted Anthony and told him that it was uncomfortable cashing
the check as written. Anthony told CRS to send the check back to him in Texas and that
he would issue it another one.
CRS received a second check for the same amount, $24,000. This time, it read
“paid.” CRS called Anthony again and expressed its concern with cashing a check that
read “paid” when it only amounted to twenty percent of the x-ray load. Anthony told
1
CRS also sued Anthony Evans d/b/a US Refinery, but for clarity we refer to
them collectively as Anthony throughout.
2
The actual consignee was listed as “AMS,” with an address of 6324 Alder Drive,
Houston, TX 77081.
Cite as 2013 Ark. App. 679
CRS that the x-ray load was actually worth only $17,000 and that if CRS would cash the
$24,000 check he would not sue for the $7,000 difference.
CRS then contacted Petag, the company Anthony said he owned. It turned out
that Don Peterson, not Anthony, actually owned Petag. Don told CRS that Anthony’s
real name was Anthony Evans, that Anthony had delivered the x-ray shipment to Petag,
and that Don had paid Anthony $99,812 for it. Further, Don alleged that Anthony had
told him to lie to CRS by stating that a large amount of the x-rays could not be processed
and were, therefore, worthless.
CRS alleged the above facts in its complaint. Anthony made a special appearance in
Arkansas to challenge personal jurisdiction. The circuit court ruled that Arkansas lacked
personal jurisdiction and dismissed Anthony from the case. 3
II. Standard of Review
Under Rule 12(b)(2) of the Arkansas Rules of Civil Procedure, a defendant may
raise the defense of lack of personal jurisdiction by motion. In considering the parties’
arguments surrounding a Rule 12(b)(2) motion, this court looks to the complaint for the
relevant facts alleging jurisdiction, which are taken as true. Malone & Hyde, Inc. v. Chisley,
308 Ark. 308, 825 S.W.2d 558 (1992). If the complaint does not allege sufficient facts on
which personal jurisdiction can rest, then the complaint is factually deficient. Davis v. St.
John’s Health Sys., Inc., 348 Ark. 17, 71 S.W.3d 55 (2002).
3
Other defendants included Jason Evans, Alex Evans, and two John Does. These
defendants were never served and were dismissed. Ark. R. Civ. P. 54(b)(5) (2013) and
Global Econ. Res., Inc. v. Swaminathan, 2011 Ark. App. 349, 389 S.W.3d 631.
Cite as 2013 Ark. App. 679
However, if the circuit court considers matters outside of the pleadings, a motion
to dismiss is converted into one for summary judgment. Ganey v. Kawasaki Motors Corp.,
366 Ark. 238, 234 S.W.3d 838 (2006). Here, the circuit court considered the motion to
dismiss and “other pleadings filed herein.” Therefore, because the parties submitted
matters outside of the pleadings and because the circuit court did not exclude them, we
treat the motion to dismiss as a motion for summary judgment. Clark v. Ridgeway, 323
Ark. 378, 914 S.W.2d 745 (1996).
Summary judgment is appropriate when there are no genuine issues of material
fact, and the moving party is entitled to judgment as a matter of law. Gentry v. Robinson,
2009 Ark. 634, 361 S.W.3d 788. Once the moving party has established a prima facie case
showing entitlement to summary judgment, the opposing party must meet proof with
proof and demonstrate the existence of a material issue of fact. Mitchell v. Lincoln, 366 Ark.
592, 237 S.W.3d 455 (2006). The evidence is reviewed in the light most favorable to the
party against whom the motion was filed, with all doubts and inferences resolved against
the moving party. Hamilton v. Allen, 100 Ark. App. 240, 267 S.W.3d 627 (2007).
There are no disputed facts as the parties agree on the essential facts surrounding
Anthony’s contact with Arkansas. 4 Thus, the question before this court is not whether
there were material facts in dispute concerning Anthony’s contact with Arkansas, but
whether, taking those facts in the light most favorable to CRS, the facts asserted in the
complaint form a sufficient basis to subject Anthony to the personal jurisdiction of
4
Anthony never presented any affidavits contradicting CRS’s allegations in its
complaint, nor did he attach any exhibits to his motion to dismiss.
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Arkansas as a matter of law. See Purser v. Buchanan, 2013 Ark. App. 449. Because this is an
issue of law, our review is de novo. Hobbs v. Jones, 2012 Ark. 293, __ S.W.3d __. 5
III. Applicable Law
Arkansas’s long-arm statute permits our courts to exercise personal jurisdiction to
the full extent of the Due Process Clause of the Fourteenth Amendment. Ark. Code Ann.
§ 16-4-101 (B) (Repl. 2010). To satisfy due process, the defendant must have “minimum
contacts” with the state and the exercise of jurisdiction must not offend “traditional
notions of fair play and substantial justice.” John Norrell Arms, Inc. v. Higgins, 332 Ark. 24,
28, 962 S.W.2d 801, 803 (1998) (citing Int’l Shoe Co. v. Washington, 326 U.S. 310, 316
(1945)).
CRS has not alleged that Anthony is subject to general personal jurisdiction in
Arkansas. Instead, if Anthony is subject to Arkansas’s jurisdiction, it must be through
specific personal jurisdiction. If the cause of action arises from or is related to the
defendant’s contacts with the forum, the court is exercising “specific jurisdiction over the
defendant.” Newbern, Watkins, and Marshall, Arkansas Civil Prac. & Proc. § 10:2 (5th ed.
2010). A state can exercise specific personal jurisdiction even if the defendant’s contacts
with the forum are slight. See John Norrell, supra.
As part of our analysis, we take into account whether the nonresident’s conduct
and connection with Arkansas are such that he could “reasonably anticipate being haled
into court” here, World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980), and
5
See also Newbern, Watkins, and Marshall, Arkansas Civil Prac. & Proc. § 26:6 (5th
ed. 2010) (“When a motion for summary judgment is granted on the basis of a question of
law, the appellate court reviews the matter de novo.”).
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whether he has purposefully directed his activities toward Arkansas residents or availed
himself of the privilege of conducting activities in Arkansas. See Burger King Corp. v.
Rudzewicz, 471 U.S. 462 (1985).
These principles have been embodied in a five-factor test that this court adopted in
Moran v. Bombardier Credit, Inc., 39 Ark. App. 122, 839 S.W.2d 538 (1992). There, we said
that the following factors are relevant in deciding whether a nonresident’s contacts with
the forum state were sufficient to impose jurisdiction: (1) the nature and quality of the
contacts with the forum state; (2) the quantity of the contacts with the forum state; (3) the
relation 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 of the parties. Id.
Personal jurisdiction can lie even if the nonresident has had only one contact with
the forum state. John Norrell, supra. The fact that a nonresident initiated the relationship
with an Arkansas company to ship products from Arkansas argues in favor of jurisdiction.
See Twin Springs Grp., Inc. v. Karibuni, Ltd., 2009 Ark. App. 649, 344 S.W.3d 100. But
telephone and mail contacts do not, standing alone, amount to minimum contacts. CDI
Contractors, Inc. v Goff Steel Erectors, Inc., 301 Ark. 311, 783 S.W.2d 846 (1990). A recent
case, though, has held that a “single bill-of-lading contract, for which [the nonresident
defendant] is the consignee, raises a question of fact regarding specific personal jurisdiction
over [the nonresident defendant].” Hotfoot Logistics, LLC v. Shipping Point Mktg., Inc., 2013
Ark. 130, at 9, __ S.W.3d __, __.
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IV. Discussion
We hold that the facts alleged in CRS’s complaint provide a sufficient basis, as a
matter of law, to subject Anthony to specific personal jurisdiction in Arkansas. We reach
this result, initially, by applying the Moran factors listed above.
Regarding the first factor, Anthony reached into Arkansas and initiated contact
with CRS in order to conduct business with an Arkansas corporation. He called CRS on
at least three occasions, emailed it another time with price quotes, and located and paid for
the freight company to have the x-ray film shipped from Arkansas to Texas. Further, he
mailed CRS two checks, had follow-up conversations with CRS, and attempted to
negotiate a settlement of the dispute over payment. Unlike CDI Contractors, supra, these
acts are more than simply mail and telephone contacts.
And while Anthony may not have an extremely large number of contacts with
Arkansas, each of those contacts implicates the third Moran factor as they are directly
related to this cause of action. On the fourth factor, Arkansas has a strong interest in
providing its businesses with a forum to redress disputes, especially those premised on
fraud and where the nonresident initiated the alleged misconduct. 6 Finally, it is naturally
more convenient for the Arkansas corporation to have redress in Arkansas. And though
Anthony is from Texas, it is a small inconvenience for him to appear here in a dispute
involving his decision to solicit and buy Arkansas goods shipped from an Arkansas
company.
6
Cf. Calder v. Jones, 465 U.S. 783, 790 (1984) (holding that Florida defendants were
the “primary participants in an alleged wrongdoing intentionally directed at a California
resident, and jurisdiction over them is proper on that basis.”).
Cite as 2013 Ark. App. 679
Ultimately, the Moran factors weigh in favor of Arkansas exercising jurisdiction.
The only factor that does not is the number of contacts; but with specific personal
jurisdiction, the nonresident’s contacts with the forum need only be slight. See John
Norrell, supra. Moreover, two other Arkansas cases further support our holding that specific
personal jurisdiction exists as a matter of law. See Hotfoot Logistics, LLC v. Shipping Point
Mktg., Inc., 2013 Ark. 130, __ S.W.3d __; Twin Springs Grp., Inc. v. Karibuni, Ltd., 2009
Ark. App. 649, 344 S.W.3d 100.
In Hotfoot, an Arkansas trucking company responded to a third-party’s solicitation
to ship products for an Arizona shipping company. The Arkansas company hired a carrier
to transport the Arizona company’s goods from Arizona to Pennsylvania. The carrier
returned a bill-of-lading to the Arkansas company. Yet the Arizona company never
entered Arkansas and never directly contacted the Arkansas company, and the only
connection the Arizona company had was as consignee on the bill-of-lading. Our supreme
court ruled that this bill-of-lading, in itself, raised a fact question regarding Arkansas’s
specific jurisdiction over the Arizona company.
In Twin Springs, our court held that a fact question existed regarding personal
jurisdiction over a nonresident defendant where the contract was initiated by the
nonresident defendant, it was negotiated and executed by the defendant’s agent while he
was in Arkansas, and it provided for an Arkansas corporation to ship Arkansas poultry to
the defendants in Bermuda.
This case is similar to both Hotfoot and Twin Springs. Here, like in Twin Springs, the
nonresident defendant (Anthony) initiated contact with an Arkansas corporation (CRS) to
Cite as 2013 Ark. App. 679
ship goods from Arkansas to Texas. And here, like in Hotfoot, that defendant was listed on
the bill-of-lading as contact for the consignee. The only difference is that Anthony never
entered Arkansas like the corporate agent did in Twin Springs. But physical presence in the
state isn’t required: in Hotfoot, neither the Arizona company nor its agents entered
Arkansas. And in this case, Anthony negotiated with Freightquote.com to enter the state
on his behalf and paid it to do so. In other words, he never entered the state, but his agent
did, just like in Twin Springs.
The distinction between those two cases and our current case is that in those, the
circuit courts improvidently denied jurisdiction when there were disputed material facts
surrounding the exercise of personal jurisdiction. Here, there are no material facts in
dispute; therefore, we are left to decide whether, as a matter of law, CRS pleaded
sufficient facts to establish specific personal jurisdiction. By applying the Moran factors, we
hold that CRS did so plead and that Arkansas has specific personal jurisdiction over
Anthony Evans. We therefore reverse the circuit court’s order that dismissed him from the
case and remand for further proceedings.
Reversed and remanded.
GLADWIN, C.J., and PITTMAN, J., agree.
Mostyn Prettyman, PLLC, by: William M. Prettyman III and Joshua Q. Mostyn, for
appellants.
Williams Law Firm of Arkansas, by: Jay B. Williams, for appellees.