Algernon Blair, Inc. v. Combs-Gates Indianapolis, Inc.

500 F. Supp. 755, 1980 U.S. Dist. LEXIS 16158
CourtDistrict Court, M.D. Alabama
DecidedNovember 4, 1980
DocketCiv. A. No. 80-326-N
StatusPublished
Cited by1 cases

This text of 500 F. Supp. 755 (Algernon Blair, Inc. v. Combs-Gates Indianapolis, Inc.) is published on Counsel Stack Legal Research, covering District Court, M.D. Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Algernon Blair, Inc. v. Combs-Gates Indianapolis, Inc., 500 F. Supp. 755, 1980 U.S. Dist. LEXIS 16158 (M.D. Ala. 1980).

Opinion

MEMORANDUM OPINION

HOBBS, District Judge.

The above styled cause is now before the Court on defendant’s motion to dismiss plaintiffs’ cause of action for improper venue, lack of venue over the defendant, lack of personal jurisdiction over the defendant, failure to state a claim on which relief can be granted, and failure to name defendant correctly. Upon a review of the pleadings and for the reasons set out below, this Court is of the opinion that defendant’s motion to dismiss should be denied.

The primary point of contention raised by this motion to dismiss has been this Court’s power to exercise personal jurisdiction over the defendant. The Court is of the opinion [757]*757that this jurisdictional issue is the sole question meriting any discussion.

FACTS

For at least three years prior to June 1980, plaintiffs received direct mail solicitation from defendant Combs-Gates Indianapolis, Inc. (hereinafter referred to as “Combs-Gates”). This regular solicitation arrived approximately once every month in the form of brochures advertising various aircraft handled by Combs-Gates for sale or lease to parties such as plaintiffs. These monthly brochures were apparently not part of an indiscriminate mailing program. On the contrary, they were addressed in a precise, personalized manner to such individuals as “Mr. Frank R. Lawson” (an official at Algernon Blair, Inc.) or to “Director of Flight Operations, Algernon Blair, Inc.”

In addition to mailings targeted directly to plaintiffs, Combs-Gates ran advertisements in such nationwide publications as “Business and Commercial Aviation” and “The A/C Flyer.” These ads solicited the business of those desiring either to buy, sell, or lease aircraft. Several of the magazines carrying such ads were distributed in Alabama.

Finally, Combs-Gates operates an aircraft parts sales division which does business in Alabama. In fact, Combs-Gates employs a sales representative in the southeastern United States whose sales territory includes the state of Alabama. The defendant stresses the limited nature of this sales representative’s activity as it relates to Combs-Gates’ overall sales. The fact nevertheless remains that some parts sales to Alabama result from regular, personal calls made on customers in Alabama by this sales representative.

In June 1980, plaintiffs became interested in trading a 681-B Turbo Commander airplane for a newer version of that same model. Plaintiffs contacted the defendant’s Colorado office regarding a possible trade of aircraft. Defendant’s Colorado office informed plaintiff that all aircraft of the type sought by plaintiffs were handled by defendant’s Indiana office. Defendant’s Indiana office promptly followed up on plaintiffs’ inquiry. At this point, there began a negotiation process between plaintiffs and Combs-Gates which stretched over the next month. Affidavits of several employees of Algernon Blair, Inc. show that approximately thirty-five phone calls were placed between the parties during this process of negotiating a trade. About two-thirds of this number were initiated by plaintiffs via defendant’s toll free Wats line. The remainder were initiated by the defendant and made to the plaintiffs in Alabama. Written correspondence also followed between the parties regarding the transaction upon which they were about to enter. This correspondence came in the form of a letter, telegrams and telexes. Defendant sent four such pieces of written communications to plaintiffs in Alabama.

Plaintiffs allege that an agreement between the parties was eventually reached, the terms of which required delivery of the old aircraft plus a cash sum by plaintiffs in return for which plaintiffs would receive from defendant a newer model of the same aircraft. Plaintiffs further allege that defendant failed to comply with the terms of this agreement. Plaintiffs have now sued defendant for damages resulting from the breach of this agreement.

CONCLUSIONS OF LAW

Plaintiff Algernon Blair, Inc. is a Delaware corporation, with its principal place of business in Montgomery, Alabama. Plaintiff Castle Construction Company, Inc. is a Delaware corporation with its principal place of business located in Montgomery, Alabama. Defendant Combs-Gates Indianapolis, Inc. is an Indiana corporation with its principal place of business located in Indianapolis, Indiana. The Court has subject matter jurisdiction over this cause by virtue of 28 U.S.C. § 1332(a); i. e., diversity of citizenship between parties and an [758]*758amount in controversy exceeding $10,000.00, exclusive of interest and costs.

This Court recently surveyed the law of personal jurisdiction in Communication Equipment and Contracting Co., Inc. v. Municipality of Anchorage, Alaska, 498 F.Supp. 632 (M.D.Ala.1980). As stated in that opinion, the jurisdiction of Alabama courts over out-of-state defendants is coextensive with the limits of due process under the Fourteenth Amendment to the United States Constitution. Semo Aviation, Inc. v. Southeastern Airways, 360 So.2d 936 (Ala.1978); Schoel v. Sikes Corp., 533 F.2d 930 (5th Cir. 1976). The question of due process is a federal question.

As has already been stated by numerous courts, the law in this area dictates that the Court consider carefully the facts of each individual case in deciding whether the assertion of personal jurisdiction is consistent with the commands of due process. The Fifth Circuit Court of Appeals has aptly described the inquiry as “a fact sensitive one.” Standard Fittings Co. v. Sapay, S.A., No. 77-3486 (Sept. 11, 1980).

A general test has evolved which requires the existence of “minimum contacts” between defendant and forum state. The test also requires an inquiry into the “fairness” of the assertion of jurisdiction over a particular out-of-state defendant. The Fifth Circuit Court of Appeals recently followed this two pronged standard in concluding that the assertion of jurisdiction over an out-of-state defendant satisfied the commands of due process, although the contacts of the defendant with the forum state appear to be substantially less than the contacts in this case.

In Oswalt v. Scripto, Inc., 616 F.2d 191 (5th Cir. 1980), the court heard an appeal from an order by a district court dismissing a cause of action against a foreign defendant for lack of personal jurisdiction. The Court of Appeals reversed.

The defendant in Oswalt was a Japanese corporation with its principal place of business in Japan. The Japanese defendant had never had any “office, place of business, servant, employee or director in either the United States or Texas [the forum asserting jurisdiction].” 616 F.2d at 197. Furthermore, there was no evidence that the Japanese defendant had “ever done business in the United States,” or with any American companies other than the defendant-third party plaintiff, Scripto, which was a California corporation and did business in Texas and other states through sales to businesses within those states.

The court’s finding of personal jurisdiction in Oswalt rested on a transaction between the Japanese defendant and Scripto, the third party plaintiff.

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Bluebook (online)
500 F. Supp. 755, 1980 U.S. Dist. LEXIS 16158, Counsel Stack Legal Research, https://law.counselstack.com/opinion/algernon-blair-inc-v-combs-gates-indianapolis-inc-almd-1980.