Wolf's Marine, Inc. v. Dev Brar

FOR PUBLICATION Jan 09 2014, 6:43 am

ATTORNEY FOR APPELLANT: ATTORNEY FOR APPELLEE:

BRUCE D. HUNTINGTON MARK D. GERTH
Botkin & Hall, LLP MICHAEL E. BROWN
South Bend, Indiana Kightlinger & Gray, LLP
Indianapolis, Indiana

IN THE
COURT OF APPEALS OF INDIANA

WOLF’S MARINE, INC., )
)
Appellant-Defendant, )
)
vs. ) No. 29A02-1303-SC-293
)
DEV BRAR, )
)
Appellee-Plaintiff. )

APPEAL FROM THE HAMILTON SUPERIOR COURT
The Honorable Wayne A. Sturtevant, Judge
Cause No. 29D05-1212-SC-12617

January 9, 2014

OPINION - FOR PUBLICATION

BARNES, Judge
 Case Summary

Wolf’s Marine, Inc. (“Wolf’s”), appeals the trial court’s denial of its motion to

dismiss a complaint filed by Dr. Dev Brar. We reverse.

Issue

The sole issue before us is whether an Indiana court can exercise personal

jurisdiction over Wolf’s.

Facts

Dr. Brar is a resident of Carmel in Hamilton County, Indiana. Wolf’s is a business

located in Berrien County, Michigan, that among other things offers seasonal storage space

for boats and boating equipment. Wolf’s has a website claiming it is the “Midwest’s

Largest Marine Accessory Store” and it also might advertise in Indiana phone books.1

Appellee’s App. p. 7. Wolf’s has no physical facilities or employees in Indiana.

Dr. Brar owned a boat that was docked in Chicago, Illinois, from May to October.

In 2010, Dr. Brar asked his personal agent, Thomas Leonard, to find a place to store the

boat for the upcoming winter. Leonard was referred to Wolf’s by an acquaintance he knew

in Chicago. Leonard then initiated contact with Wolf’s, who in turn emailed a rental

contract to Leonard in Carmel at Leonard’s request. Leonard signed and returned the

contract to Wolf’s. There was no forum selection provision in the contract. Leonard then

piloted Dr. Brar’s boat across Lake Michigan from Chicago to Wolf’s dock in Benton

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Leonard claimed in an affidavit provided to the trial court that Wolf’s “solicited business from Indiana
residents via the Yellow Pages” and claimed to attach a copy of such “advertisement” to his affidavit.
Appellee’s App. p. 5. The attachment referred to, however, is simply an Internet listing for Wolf’s from
the Yellowpages.com website based upon a search for “Wolfs Marine Inc near South Bend, IN.” Id. at 8.
This does not indicate that Wolf’s placed actual ad listings in physical Indiana phone books.

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Harbor, Michigan, and Wolf’s stored the boat at its facility. Leonard took the boat back to

Chicago in May 2011. Wolf’s sent a bill for its services to Leonard in Carmel, and Leonard

arranged for payment to Wolf’s accordingly.

Leonard again contracted with Wolf’s to store Dr. Brar’s boat for the 2011-2012

winter season, following the same procedure as in 2010-11. Leonard asserts that when he

left the boat at Wolf’s harbor in October 2011, it was completely undamaged. However,

Leonard claims that when he retrieved the boat in May 2012, the bow was damaged.

Dr. Brar filed a small claims complaint against Wolf’s in Hamilton County, alleging

damages to his boat in the amount of $6000. Wolf’s owner subsequently wrote a letter to

the trial court stating, “I feel that if a claim is to be filed, it should be filed in Berrien

County, Michigan.” Appellant’s App. p. 12. The trial court ordered Dr. Brar to respond

to this letter. After Dr. Brar responded in writing, the trial court found it had personal

jurisdiction over Wolf’s. Wolf’s then obtained counsel, and it filed a motion to dismiss for

lack of personal jurisdiction. Without conducting a hearing, the trial court denied the

motion. Wolf’s obtained permission from the trial court and this court to pursue an

interlocutory appeal from this denial.

Analysis

The existence of personal jurisdiction is a question of law we review de novo.

LinkAmerica Corp. v. Albert, 857 N.E.2d 961, 965 (Ind. 2006). “We do not defer to the

trial court’s legal conclusion as to whether personal jurisdiction exists.” Id. Whether

personal jurisdiction exists turns on facts, namely the extent of a defendant’s contacts with

the forum, and ordinarily a trial court’s factual findings on that point would be reviewed

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for clear error. Id. Here, however, the trial court did not conduct any hearings regarding

personal jurisdiction and instead ruled entirely on paper records submitted by the parties.

In such a case, “we are in as good a position as the trial court to determine the existence of

jurisdictional facts and will employ de novo review as to those facts.” Munster v. Groce,

829 N.E.2d 52, 57 (Ind. Ct. App. 2005).

The existence of personal jurisdiction over a defendant is a constitutional

requirement for entering a valid judgment, mandated by the Due Process Clause of the

Fourteenth Amendment to the United States Constitution. Id. Also, Indiana’s “long-arm”

rule for exercising personal jurisdiction over out-of-state defendants, Indiana Trial Rule

4.4(A), permits the exercise of personal jurisdiction in any manner consistent with the Due

Process Clause. LinkAmerica, 857 N.E.2d at 967. When a defendant challenges the

existence of personal jurisdiction, the plaintiff must present evidence of the court’s

personal jurisdiction over the defendant. Norris v. Personal Finance, 957 N.E.2d 1002,

1007 (Ind. Ct. App. 2011). The defendant, however, bears the ultimate burden of proving

lack of personal jurisdiction by a preponderance of the evidence, unless such lack is

apparent on the face of the complaint. Id.

In assessing whether the exercise of personal jurisdiction over a defendant would

violate the Due Process Clause, “a person must 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.” Brockman v. Kravic, 779 N.E.2d 1250, 1256 (Ind. Ct. App. 2002)

(citing International Shoe Co. v. Washington, 326 U.S. 310, 66 S. Ct. 154 (1945)). Also,

a defendant’s contacts must “consist of some action by which the defendant purposefully

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avails itself of the privilege of conducting activities within the forum state, thus invoking

the benefits and protections of its laws.” Id. (citing Hanson v. Denckla, 357 U.S. 235, 78

S. Ct. 1228 (1958)). “Only the purposeful acts of the defendant, not the acts of the plaintiff

or any third parties, satisfy this requirement.” Id.

Under these principles, courts must first “look at the contacts between the defendant

and the forum state to determine if they are sufficient to establish that the defendant could

reasonably anticipate being haled into court there.” Id. “Contacts are any acts physically

performed in the forum state or acts performed outside the forum state that have an effect

within the forum.” Id. When evaluating a defendant’s contacts with a forum state, courts

should assess: (1) whether the plaintiff’s claim arises from the defendant’s forum contacts;

(2) the overall contacts of the defendant or its agent with the forum state; (3) the

foreseeability of being haled into court in that state; (4) who initiated the contacts; and (5)

whether the defendant expected or encouraged contacts with the state. Id. at 1257.

If sufficient contacts exist, courts must then “evaluate whether the exercise of

personal jurisdiction offends traditional notions of fair play and substantial justice by

weighing a variety of interests.” Id. at 1256. The various interests to consider and weigh

include: (1) the burden on the defendant of litigating in the forum state; (2) the forum

state’s interest in adjudicating the dispute; (3) the plaintiff’s interest in obtaining

convenient and effective relief; (4) the interstate judicial system’s interest in obtaining the

most efficient resolution of controversies; and (5) the shared interest of the several states

in furthering fundamental substantive social policies. Id. at 1257. “The fairness inquiry is

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separate from the contacts question and may be used to defeat jurisdiction even if the

defendant has sufficient contacts with the forum state.” Id.

In addition to these general principles, a defendant’s contacts with a state may give

rise to either general or specific personal jurisdiction. As we explained in Brockman:

General personal jurisdiction refers to the ability to be
sued for any claim in a state. In order to establish
general personal jurisdiction, the court must find continuous
and systematic contacts with the forum state such that the
defendant could reasonably foresee being haled into court in
that state for any matter. General personal jurisdiction may
exist if the contacts are substantial, continuous, and systematic.
The contacts required for general personal jurisdiction are
greater than those needed to establish
specific personal jurisdiction.

Specific personal jurisdiction is jurisdiction that stems
from the defendant’s having certain minimum contacts with
the forum state so that the court may hear a case whose issues
arise from those minimum contacts. Under this theory, the
defendant’s isolated contacts with a state that are not enough
to establish general personal jurisdiction may be sufficient to
allow jurisdiction over any incidents related to those
contacts. A single contact with a forum state may be enough
to establish specific personal jurisdiction if it creates a
substantial connection with the forum state and the suit is based
on that connection. However, the act must be purposeful, not
random or attenuated or the unilateral activity of another party
or a third person.

Id. at 1256-57 (citations omitted).

Dr. Brar’s sole argument on appeal is that Wolf’s had sufficient contacts with

Indiana to establish specific personal jurisdiction in this case; he does not argue that Wolf’s

had such substantial, systematic, and continuous contacts with Indiana to establish general

personal jurisdiction. In particular, Dr. Brar contends that this court has on several

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occasions held that a decision by an out-of-state defendant “to enter into a contract with an

Indiana resident was sufficient to allow Indiana to exercise personal jurisdiction over that

defendant.” Appellee’s Br. p. 9. For this proposition Dr. Brar cites Attaway v. Omega,

903 N.E.2d 73 (Ind. Ct. App. 2009), Mid-States Aircraft Engines, Inc. v. Mize Co., Inc.,

467 N.E.2d 1242 (Ind. Ct. App. 1984), and Woodmar Coin Center, Inc. v. Owen, 447

N.E.2d 618 (Ind. Ct. App. 1983).

The United States Supreme Court, however, has unequivocally held, “If the question

is whether an individual’s contract with an out-of-state party alone can automatically

establish sufficient minimum contacts in the other party’s home forum, we believe the

answer clearly is that it cannot.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 478,

105 S. Ct. 2174, 2185 (1985). Personal jurisdiction does not turn on “mechanical” tests,

including where a contract was entered into or was to be performed. Id. Instead, when

determining whether a contract should give rise to personal jurisdiction in a plaintiff’s state,

courts should consider facts such as “prior negotiations and contemplated future

consequences, along with the terms of the contract and the parties’ actual course of dealing

. . . .” Id. at 479, 105 S. Ct. at 2185. In Burger King, the Court held that a defendant located

in Michigan who entered into a franchise agreement with the Burger King fast food chain,

whose headquarters were located in Florida, could be sued in Florida for breach of the

franchise agreement. Although the defendant had never set foot in Florida, he had

deliberately sought to enter into a “carefully structured” twenty-year franchise agreement

with a nationwide company based in Florida, which would require “continuing and wide-

reaching contacts with Burger King in Florida,” including regulation of the franchise from

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Florida. Id. at 479-80, 105 S. Ct. at 2186. Under these circumstances, the Court held that

personal jurisdiction over the defendant existed in Florida. Id.

We are not convinced that either Mid-States or Woodmar can be read for the simple

proposition that Dr. Brar proposes, namely that merely entering into a contract with an

Indiana resident subjects an out-of-state defendant to suit in Indiana. Even if those cases

did so hold, they were decided before Burger King clearly held to the contrary. As for

Attaway, that case involved a suit filed against Idaho residents who purchased a car located

in Indiana in response to an eBay listing posted by Indiana residents, hired an agent to pick

up the car in Indiana and deliver it to Idaho, and then rescinded payment for the car. We

ultimately held it was proper “to exercise personal jurisdiction over individuals who have

entered into a contract with an Indiana resident for the purchase of property located in

Indiana, have removed that property from the state of Indiana, and then rescinded

payment.” Attaway, 903 N.E.2d at 79. Thus, in Attaway, there was significantly more

contact than merely entering into a contract with an Indiana resident as a basis for personal

jurisdiction to exist in that case.

Here, by contrast, no property located within Indiana was the subject of the contract

between Wolf’s and Dr. Brar. There also was no long-term and complicated entanglement

between the parties, nor was Wolf’s attempting to associate itself with an out-of-state

“brand,” as was the case in Burger King. Leonard did make payment to Wolf’s from

Indiana, but making payment to an out-of-state defendant from a bank account located in

the forum state generally is insufficient to permit the exercise of personal jurisdiction over

the defendant. See JPMorgan Chase Bank, N.A. v. Desert Palace, Inc., 882 N.E.2d 743,

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751 (Ind. Ct. App. 2008) (citing Helicopteros Nacionales de Colombia, S.A. v. Hall, 466

U.S. 408, 416, 104 S. Ct. 1868, 1873 (1984)), trans. denied.

In fact, because this case does not concern the sale of property or the transfer of

property to or from Indiana, we believe that cases addressing the use of the Internet or other

media to advertise the sale of products to be shipped between states, such as Attaway,

provide little guidance here. Also, although Wolf’s has a website describing its services

that is accessible in Indiana, it is primarily a form of nation- or region-wide advertising

that, by itself, is not enough to establish personal jurisdiction over Wolf’s in Indiana. “If

the defendant merely operates a website, even a ‘highly interactive’ website, that is

accessible from, but does not target, the forum state, then the defendant may not be haled

into court in that state without offending the Constitution.” be2 LLC v. Ivanov, 642 F.3d

555, 559 (7th Cir. 2011). Although Wolf’s website boasts that it is the “Midwest’s Largest

Marine Accessory Store,” that does not mean that it specifically targeted Indiana residents

as opposed to residents throughout the undefined “Midwest” region. Appellee’s App. p.

7. As for Wolf’s possible advertising in Indiana Yellow Pages, it does not appear to have

any relevance to a specific jurisdiction analysis because Dr. Brar is not making any claim

that any such advertising was false or misleading; moreover, Leonard learned of Wolf’s

through an acquaintance in Chicago, not through Wolf’s advertising or Yellow Pages

listing. See J.A. Riggs Tractor Co. v. Bentley, 209 S.W.3d 322, 332 (Tex. App. 2006)

(holding fact that Arkansas company marketed itself in Texas phone books was irrelevant

to jurisdictional analysis where there was no evidence such marketing was related to

contested sale of product).

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 Instead, this case is more similar to ones in which a hotel or other attraction

advertises its services to residents in other states, a person decides to visit that hotel or

attraction, he or she sustains injury at the hotel or attraction, and then attempts to sue the

hotel or attraction in his or her home state. In Brokemond v. Marshall Field & Co., 612

N.E.2d 143 (Ind. Ct. App. 1993), an Indiana resident allegedly was injured after ingesting

bits of glass in a salad bought at a Marshall Field’s store restaurant in Calumet City, Illinois.

The Indiana resident sued Marshall Field’s in Indiana, claiming, among other things, that

it advertised extensively to Indiana residents, delivered merchandise into Indiana, and that

Calumet City was in close proximity to Indiana. This court held that Indiana did not have

personal jurisdiction over Marshall Field’s with respect to the Indiana resident’s claim,

concluding in part that Illinois had “a greater interest in determining if food served within

its boundaries is reasonably safe for consumption.” Brokemond, 612 N.E.2d at 146.

Similarly, in Szakacs v. Anheuser-Busch Companies, Inc., 644 F. Supp. 1121, 1125 (N.D.

Ind. 1986), the court held that Indiana could not exercise personal jurisdiction over an

amusement park located in Florida with respect to an Indiana resident allegedly injured at

the park, merely because of the park’s nationwide advertising campaign encouraging

people to visit the park.

Here, similar to Brokemond and Szakacs, Wolf’s has advertised its services

throughout the region, but its services are provided exclusively in Michigan, and the

alleged breach of contract or negligence that caused damage to Dr. Brar’s boat occurred

exclusively in Michigan. This case is slightly different than Brokemond and Szakacs, in

that Leonard did execute a contract on Dr. Brar’s behalf in Indiana. We believe this would

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be akin to purchasing a ticket to an out-of-state attraction in a forum state, but this has been

held insufficient to establish personal jurisdiction over the attraction for an injury allegedly

sustained at the attraction. See Russo v. Sea World of Florida, Inc., 709 F. Supp. 39, 43-

44 (D. R.I. 1989) (holding that Sea World-Florida’s nationwide advertising campaign and

fact that allegedly injured tourist purchased ticket to attraction in Rhode Island was

insufficient to establish personal jurisdiction over attraction in Rhode Island).

Additionally, the mere fact that a plaintiff executes a contract in his or her home state and

sends the contract back to an out-of-state defendant does not confer personal jurisdiction

over the defendant. See Lane v. Vacation Charters, Ltd., 750 F. Supp. 120, 124 (S.D. N.Y.

1990) (stating, “The ‘last formal act of [contract] execution . . . is of little, if any

jurisdictional significance.’”) (quoting Hoffritz for Cutlery, Inc. v. Amajac, Ltd., 763 F.2d

55, 60 n.2 (2nd Cir. 1985)).

Here, no goods were delivered to or from Indiana, nor were any services performed

in Indiana, and the allegedly damaged boat was docked in Illinois, not Indiana, when it was

not stored in Michigan. Although Leonard executed the contract on Dr. Brar’s behalf in

Indiana, the entirety of the contract’s performance was to take place in Michigan, save for

Dr. Brar’s payment coming from Indiana. The contract was not in the nature of a long-

term entanglement between the parties, as in Burger King, but instead was limited in

duration and scope and was not automatically renewed from year-to-year. For the second

year that Dr. Brar and Leonard contracted with Wolf’s to store the boat, it again was

Leonard who initiated contact with Wolf’s, not vice versa. The contract also was a pre-

printed form contract, created in Michigan and sent from Michigan to Indiana at Leonard’s

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request, and it was not the result of negotiations between the parties. Wolf’s alleged

negligence or breach of contract occurred in Michigan, not Indiana. Wolf’s has no physical

presence whatsoever in Indiana, in the form of facilities or employees. Also, Michigan has

a greater interest than Indiana in ensuring that Wolf’s is operating its facility in a proper

manner. Wolf’s deliberate contacts with Indiana were limited to general advertising,

emailing a form contract to Leonard at Leonard’s request, and invoicing and receiving

payment from Leonard. We hold this was not sufficient “purposeful availment” of the

privilege of conducting business in Indiana by Wolf’s so as to permit Indiana to exercise

specific personal jurisdiction over it with respect to Dr. Brar’s cause of action.

Conclusion

The trial court incorrectly determined that personal jurisdiction over Wolf’s existed

in Indiana, and it should have granted Wolf’s motion to dismiss. We reverse the denial of

that motion.

Reversed.

ROBB, J., and BROWN, J., concur.

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