Doebler v. Stadium Productions Limited

91 F.R.D. 211, 1981 U.S. Dist. LEXIS 14036
CourtDistrict Court, W.D. Michigan
DecidedAugust 17, 1981
DocketNo. G80-860 CA6
StatusPublished
Cited by7 cases

This text of 91 F.R.D. 211 (Doebler v. Stadium Productions Limited) is published on Counsel Stack Legal Research, covering District Court, W.D. Michigan primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Doebler v. Stadium Productions Limited, 91 F.R.D. 211, 1981 U.S. Dist. LEXIS 14036 (W.D. Mich. 1981).

Opinion

OPINION

BENJAMIN F. GIBSON, District Judge.

This is an action pursuant to various state and federal laws alleging unlawful acts in connection with the sale of securities of defendant Stadium Productions Limited (Stadium). Stadium was formed as an Illinois corporation in November of 1978 by James Kirk, an attorney practicing law in that state. Defendant Douglas Van Boven, a shareholder as well as the president and chief executive officer of Stadium, has filed a third-party complaint against Kirk and another person not relevant here. Van Bo-ven alleges that Kirk breached a duty to advise him about the stock issued by Stadium. Presently before this Court is a motion by Kirk to dismiss him from the action for lack of personal jurisdiction.

In support of his motion, Kirk has filed an affidavit stating that he is not licensed to practice law in any state other than Illinois; that he owns no property located in Michigan, conducts no business there, and has no contracts with Michigan residents; that the work done for Van Boven was done at the request of another of Kirk’s clients and was not solicited; that such work was restricted to filing articles of incorporation, execution of land leases for Illinois property belonging to Kirk’s other client, preparation of contracts and leases of the Illinois property, correspondence with the Illinois Department of Labor, and forwarding of notices from the Illinois Secretary of State’s office to Van Boven; that Kirk never agreed to and never did represent Van Boven or Stadium with respect to the preparation of by-laws, minutes or the issuance of stock; that he specifically advised Van Boven of the Illinois statutes and regulations regarding the issuance of stock and that the scope of his practice did not include the issuance of such stock; and finally, that Kirk’s contacts with Van Bo-ven were limited to personal meetings in Illinois, several letters regarding franchise fees and annual corporate officer reports, and telephone conversations initiated by Van Boven relating to his overdraft of a checking account in an Illinois bank.

Van Boven directly disputes only two of these allegations in his opposing affidavit. He alleges that telephone calls were initiated by both him and Kirk, and that “only after institution of the principal action in this case did James F. Kirk ever acknowledge to deponent that there was or could be an unfortunate legal consequence of deponent’s selling of Stadium Production Limited’s stock.” In addition, Van Boven claims that Kirk was his attorney until he became a third-party defendant in this action. Van Boven’s attorney states in his brief that Kirk initially prepared the stock certificates issued to Van Boven and that Kirk advised Van Boven with respect to the preparation of subsequent stock certificates with knowledge that they would be sold to Michigan residents.

The burden of establishing jurisdiction is on the plaintiff, or here, the third-party plaintiff. When the issue is determined solely on the basis of written materials, he need only present a prima facie case, and the pleadings and affidavits must be considered in the light most favorable to the party asserting the existence of jurisdiction. Welsh v. Gibbs, 631 F.2d 436 (6th Cir. 1980), cert. denied 450 U.S. 981, 101 S.Ct. 1517, 67 L.Ed.2d 816 (1981).

Plaintiffs have filed a brief in opposition to the motion to dismiss. They argue that Fed.R.Civ.P. 14 allows third-party claims to be heard under the doctrine of ancillary jurisdiction, and that Kirk’s argument for dismissal is therefore in error. [214]*214This is clearly not the law. “The cases unanimously hold that a federal court must obtain personal jurisdiction over a third-party defendant before it proceeds to adjudicate a third-party claim.” 6 Wright & Miller, Federal Practice and Procedure: Civil § 1445 (1971). In James Talcott, Inc. v. Allahabad Bank, Ltd., 444 F.2d 451, 464-65, n.ll (5th Cir. 1971), e. g., a similar misunderstanding prompted the court to explain that even though ancillary jurisdiction may confer subject matter jurisdiction on a federal court, personal jurisdiction over the third-party defendant is still necessary. Accord, cases cited in 6 Wright & Miller, supra.

Thus, Van Boven must present a prima facie case of personal jurisdiction over Kirk. The parties do not dispute the fact that this Court lacks general personal jurisdiction over Kirk. Pursuant to Fed.R.Civ.P. 4(e), Van Boven relies on the Michigan long arm statute, M.C.L.A. § 600.705, to establish limited personal jurisdiction in this case.1 He points particularly to subsection five, providing jurisdiction over an individual who enters into a contract for services to be rendered or for materials to be furnished in the state.

This Court has previously noted that the due process clause of the Fourteenth Amendment requires that the defendant have such minimum contacts with the forum state that maintenance of an action would not offend traditional notions of fair play and substantial justice. Speckine v. Stanwick International, Inc., 503 F.Supp. 1055 (W.D.Mich.1980). Accord, Chrysler Corp. v. Fedders Corp., 643 F.2d 1229, 1236 (6th Cir. 1981).

The Sixth Circuit has applied a three-part test for determining whether a given set of circumstances provides sufficient contact between a nonresident defendant and the forum state to support personal jurisdiction:

First, the defendant must purposefully avail himself of the privilege of acting in the forum state or causing a consequence in the forum state. Second, the cause of action must arise from the defendant’s activities there. Finally, the acts of the defendant or consequences caused by the defendant must have a substantial enough connection with the forum state to make the exercise of jurisdiction over the defendant reasonable.

Southern Machine Co. v. Mohasco Industries, Inc., 401 F.2d 374, 381 (6th Cir. 1968) (footnote omitted). Accord, Welsh; Davis H. Elliot Co., Inc. v. Caribbean Utilities Co., 513 F.2d 1176 (6th Cir. 1975). As was noted in Speckine, such criteria are consistent with recent Supreme Court decisions. 503 F.Supp. at 1057-58. This Court finds that none of the three criteria are not in this case.

A purposeful availment requires involvement with the state through actions freely and intentionally done — something more than a situation where all contacts result entirely from a decision made by the [215]*215plaintiff. Davis H. Elliot Co., 513 F.2d at 1182. Even considering the facts in the light most favorable to Van Boven, it is apparent that Kirk’s actions do not satisfy this requirement.

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Bluebook (online)
91 F.R.D. 211, 1981 U.S. Dist. LEXIS 14036, Counsel Stack Legal Research, https://law.counselstack.com/opinion/doebler-v-stadium-productions-limited-miwd-1981.