Alacron, Inc. v. Swanson

765 A.2d 1043, 145 N.H. 625, 2000 N.H. LEXIS 121
CourtSupreme Court of New Hampshire
DecidedDecember 28, 2000
DocketNo. 98-442
StatusPublished
Cited by11 cases

This text of 765 A.2d 1043 (Alacron, Inc. v. Swanson) is published on Counsel Stack Legal Research, covering Supreme Court of New Hampshire primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Alacron, Inc. v. Swanson, 765 A.2d 1043, 145 N.H. 625, 2000 N.H. LEXIS 121 (N.H. 2000).

Opinion

BROCK, C.J.

The defendants, William Swanson, James Holly, William Watts, Esther Swanson, and Edwin Swanson, all residents of California, appeal an order of the Superior Court (Dalianis, J.) denying their motion to dismiss for lack of personal jurisdiction. We affirm and remand.

This action arises out of the purchase of Hyperspeed Technologies, Inc. (Hyperspeed), a closely held California corporation in the business of manufacturing computer hardware and software, by the plaintiff, Alacron, Inc. (Alacron), a computer products manufacturer with a principal place of business in Nashua. Between 1992 and 1996, Hyperspeed sold computer products to New Hampshire customers. In 1996, Alacron approached the defendants, who were Hyperspeed’s only principals at that time, to negotiate the purchase of all of Hyperspeed’s assets and stock. Between the spring and fall of 1996, the parties negotiated the purchase through personal meetings in California and through telephone conversations, facsimiles, and letters between California and New Hampshire. On December 31, 1996, one day before Alacron’s purchase of Hyperspeed, all of the defendants, as the directors of Hyperspeed, signed a corporate resolution authorizing the sale of Hyperspeed to Alacron. Also before the purchase, Edwin and Esther Swanson, officers and directors of Hyperspeed at that time, called due a promissory note, held by them as trustees of the Swanson Family [627]*627Trust, against Hyperspeed in the amount of thirty thousand dollars. The acceleration of this note was not disclosed to Alacron before the purchase of Hyperspeed.

As part of the stock purchase agreement (agreement), Hyperspeed and its shareholders, William Swanson and James Holly, represented and warranted the financial condition of the company and the quality of its products. The agreement provided that after the purchase of Hyperspeed: (1) Watts would be elected as a director and chief executive officer of Hyperspeed; (2) Holly and William Swanson would be elected as vice presidents of Hyperspeed; and (3) William Swanson, Holly, and Watts would become contract employees of Alacron. In addition, Holly and William Swanson agreed to indemnify Alacron against any liability incurred by Hyperspeed that had not been disclosed to Alacron before the purchase. The parties completed the agreement on January 1, 1997. To fulfill their employment obligations to Alacron after the agreement, Holly, Watts, and William Swanson routinely traveled to New Hampshire.

In the fall of 1997, Alacron discovered that the defendants allegedly misrepresented Hyperspeed’s financial condition and the quality of its products. In response, Alacron brought this action asserting misrepresentation, breach of contract, and breach of the implied covenant of good faith and fair dealing. Alacron also sought indemnification from Holly and William Swanson pursuant to the agreement.

The defendants moved to dismiss for lack of personal jurisdiction. In response, Alacron submitted an affidavit by Alacron’s Chief Executive Officer, Dr. Joseph Sgro, that identified Alacron as a corporation with its principal and only place of business in New Hampshire. In addition, Sgro, based on personal knowledge, described the events leading up to the agreement and the defendants’ contacts with Alacron, including their alleged misrepresentations. According to the superior court, “Alacron has sufficiently pleaded that the defendants’ alleged tortious misrepresentations caused injury to Alacron in our State” and exercising personal jurisdiction over the defendants was consistent “with traditional notions of fair play and substantial justice.” As a result, the court denied the motion. This appeal followed.

On appeal, the defendants assert that the trial court misapplied the standard by which a party’s contacts with the forum State are measured under the State’s long-arm statute and the Due Process Clause of the Fourteenth Amendment of the Federal Constitution. [628]*628In addition, they assert that the trial court failed to address their individual jurisdictional defenses.

Generally, when a motion to dismiss is reviewed, “all facts properly pleaded by the plaintiff are deemed true.” Brother Records v. HarperCollins Publishers, 141 N.H. 322, 324, 682 A.2d 714, 715-16 (1996).. When jurisdiction is contested, however, “[t]he plaintiff bears the burden of demonstrating facts sufficient to establish personal jurisdiction over the defendant.” Phelps v. Kingston, 130 N.H. 166, 170, 536 A.2d 740, 742 (1987). The plaintiff need only make a prima facie showing of jurisdictional facts to defeat the defendants’ motion to dismiss. See Brother Records, 141 N.H. at 325, 682 A.2d at 716.

The State’s long-arm statute, RSA 510:4, I (1997), permits jurisdiction over “[a]ny person who is not an inhabitant of this state and who, in person or through an agent, transacts any business within this state, commits a tortious act within this state, or has the ownership, use, or possession of any real or personal property situated in this state.” Because we construe the long-arm statute broadly, see Leeper v. Leeper, 114 N.H. 294, 296-97, 319 A.2d 626, 627-28 (1974), personal jurisdiction over nonresidents may be exercised whenever the requirements of the Due Process Clause of the United States Constitution are satisfied. See Estabrook v. Wetmore, 129 N.H. 520, 523, 529 A.2d 956, 958 (1987).

The federal Due Process Clause permits the exercise of personal jurisdiction over a foreign defendant if “the defendant has certain minimum contacts such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Brother Records, 141 N.H. at 324, 682 A.2d at 715 (quotations and ellipsis omitted). Where, as here, specific rather than continuous contacts with the forum are the basis for personal jurisdiction, whether these contacts are sufficient to confer jurisdiction over a foreign defendant depends upon the relationship between the defendant, the forum, and the litigation. See Helicopteros Nacionales de Colombia v. Hall, 466 U.S. 408, 414 (1984). The focus of this inquiry, therefore, is not merely whether each of the defendants’ contacts might have caused injury in New Hampshire, but whether these contacts should have given each defendant notice that he or she should reasonably have anticipated being haled into court in this State. See Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474 (1985). This second inquiry looks for “some act by which the defendant purposefully avails itself of the privilege of conducting [629]*629activities within the forum State, thus invoking the benefits and protections of its laws.” Hanson v. Denckla, 357 U.S. 235, 253 (1958); see also Staffing Network, Inc. v. Pietropaolo, 145 N.H. 454, 764 A.2d 905 (2000).

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Bluebook (online)
765 A.2d 1043, 145 N.H. 625, 2000 N.H. LEXIS 121, Counsel Stack Legal Research, https://law.counselstack.com/opinion/alacron-inc-v-swanson-nh-2000.