Elliott v. Armor Holdings, Inc. CV-99-337-B 01/12/00
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW HAMPSHIRE
J. Michael Elliott
v. Civil N o . 99-337-B Opinion N o . 2000 DNH 012 Armor Holdings, Inc.
MEMORANDUM AND ORDER
J. Michael Elliott brought this action against his former
employer, Armor Holdings, Inc., claiming that Armor Holdings
breached its contract with him by failing to provide him with
stock options, vacation pay, and copies of his personnel file and
other employment records.1 Elliott also claims breach of the
covenant of good faith and fair dealing and, in the alternative,
1 Elliott originally filed this action in Rockingham County Superior Court. The case subsequently was removed to this court, which has subject matter jurisdiction based on diversity of citizenship. See Notice of Removal of Civil Action (part of Doc. #13) at 1-2. quantum meruit, based on the same underlying allegations.2 Armor
2 Because Elliott’s claims for breach of the covenant of good faith and fair dealing and quantum meruit derive from the same allegations that underlie his contract claim, I focus my jurisdictional analysis on the contract claim.
-2- Holdings has moved pursuant to Federal Rule of Civil Procedure
12(b)(2) to dismiss Elliott’s action for lack of personal
jurisdiction.3 For the reasons that follow, I grant Armor
Holdings’s motion (Doc. # 5 ) .
I. Standard of Review
When a defendant contests personal jurisdiction, the
plaintiff bears the burden of demonstrating that a basis for
asserting jurisdiction exists. See Massachusetts Sch. of Law at
Andover, Inc. v . American Bar Ass’n, 142 F.3d 2 6 , 34 (1st Cir.
1998); Rodriguez v . Fullerton Tires Corp., 115 F.3d 8 1 , 83 (1st
Cir. 1997). Because no evidentiary hearing has been held in the
present case, I hold Elliott to a prima facie standard. See
3 Armor Holdings has moved in the alternative for dismissal for improper venue pursuant to Rule 12(b)(3), based on a forum selection clause in the 1996 employment contract between the parties. See Mem. in Supp. of Def.’s Mot. to Dismiss (Doc. #5) at 1 & n.1. Because I find that I cannot exercise personal jurisdiction over Armor Holdings, I do not address the venue issue.
-3- Sawtelle v . Farrell, 70 F.3d 1381, 1386 n.1 (1st Cir. 1995)
(citing United Elec. Radio and Mach. Workers of Am. (UE) v . 163
-4- Pleasant S t . Corp., 987 F.2d 3 9 , 43 (1st Cir. 1993) [hereinafter
Pleasant S t . I I ] ) .
To make a prima facie showing, Elliott may not rest on his
pleadings. Rather, he must “adduce evidence of specific facts”
that support jurisdiction. Foster-Miller, Inc. v . Babcock &
Wilcox Canada, 46 F.3d 138, 145 (1st Cir. 1995); Pleasant S t . I I ,
987 F.2d at 4 4 . In conducting my analysis, I take the facts
proffered by Elliott as true and construe them in the light most
favorable to his jurisdictional claim. See Massachusetts Sch. of
Law, 142 F.3d at 3 4 ; Foster-Miller, 46 F.3d at 145. I do not act
as a fact-finder; rather, I determine “whether the facts duly
proffered, [when] fully credited, support the exercise of
personal jurisdiction.” Rodriguez, 115 F.3d at 84 (citing Boit
v . Gar-Tec Prods., Inc., 967 F.2d 671, 675 (1st Cir. 1992)).
While the prima facie standard is liberal, I need not
“‘credit conclusory allegations or draw farfetched inferences.’”
Massachusetts Sch. of Law, 142 F.3d at 34 (quoting Ticketmaster-
-5- New York, Inc. v . Alioto, 26 F.3d 201, 203 (1st Cir. 1994)). I
-6- consider facts offered by Armor Holdings, but only to the extent
that they are uncontradicted. See id.
II. Facts
Armor Holdings is a Delaware corporation with a principal
place of business in Jacksonville, Florida. See Spiller Aff.
(Doc. #10) ¶ 2 . The company sells security services and security
products, including body armor, less-than-lethal munitions, and
anti-riot equipment. See id. These products are manufactured by
Armor Holdings’s wholly-owned subsidiaries. See Elliott Aff.
(attached to Doc. #9) ¶ 1 8 . Armor Holdings does not maintain an
office or bank account in New Hampshire, is not registered to do
business in New Hampshire, and owns no real property in New
Hampshire. See Spiller Aff. ¶ 3 . None of the company’s
subsidiaries are located in New Hampshire. See id.
Elliott was associated with Armor Holdings from September
1991 through January 1999. See Elliott Aff. ¶ 5 . During most of
that period -- from December 1991 until some time in 1997 --
-7- Elliott resided in Florida. See id. Since August 1997, Elliott
has been a resident of New Hampshire. See id. ¶¶ 2 , 1 3 .
Over the course of their relationship, the parties formed a
series of agreements. In January 1994, Elliott entered into a
written, two-year employment contract with Armor Holdings.4 See
id. ¶ 6 and Ex. A . In January 1996, after the expiration of the
1994 agreement, the parties entered into another written
employment contract (“the 1996 agreement”) for a term of one year
with an option (held by Armor Holdings) to renew. See id. ¶ 7
and Ex. B . In addition to setting forth Elliott’s compensation
and benefits, the 1996 agreement contained choice of law and
forum selection clauses in which the parties agreed that any
disputes under the contract would be governed by New York law and
4 At that time, the company was known as American Body Armor & Equipment, Inc. See Elliott Aff. ¶¶ 5 , 6. An entity with the same name became one of Armor Holdings’s wholly-owned subsidiaries. See id. ¶¶ 18-21; Spiller Aff. ¶ 4 . To avoid confusion, I refer to the parent company, the defendant in this action, as “Armor Holdings” throughout this order.
-8- be subject to the exclusive jurisdiction of the courts of New
York County, New York. See id. Ex. B ¶¶ 11(h), ( i ) . In December
1996, Elliott received a letter from Armor Holdings, informing
him that the 1996 agreement would not be renewed when its one-
year term expired on January 1 7 , 1997. See id. ¶ 9 and Ex. C .
Elliott subsequently negotiated an oral agreement (“the 1997
agreement”) with Jonathan Spiller, the chief executive officer of
Armor Holdings. See id. ¶ 1 0 . While the parties dispute whether
Elliott was an employee or a consultant under the 1997 agreement,
they agree that their relationship ended in January 1999.
Compare id. ¶¶ 1 0 , 11 with Spiller Aff. ¶¶ 1 6 , 2 0 ; Spiller Reply
Aff. (Doc. #14) ¶ 4 .
The evidence proffered by Elliott in support of his
jurisdictional claim falls into three main categories: (1)
evidence that Elliott performed work for Armor Holdings at his
New Hampshire residence; (2) evidence that representatives of
Armor Holdings advertised, marketed, and sold products in New
-9- Hampshire; and (3) evidence that Armor Holdings acquired
Safariland, Inc., a company that did business in New Hampshire.
I set forth each body of evidence in turn, then discuss specific
jurisdictional facts in the context of the subsequent analysis.
A. Elliott’s Performance of Work at His New Hampshire Residence
Elliott’s New Hampshire residence contained a home office in
which he performed various work activities for Armor Holdings
after August 1997. See Elliott Aff. ¶¶ 2 , 1 3 . These activities
included “writing reports, drafting proposals, coordinating . . .
travel plans, planning, and other company-related business.” Id.
¶ 1 3 . Between January and June 1998, Elliott helped to conduct
negotiations and due diligence investigations related to Armor
Holdings’s acquisition of the law enforcement division of Mace
Security (located in Bennington, Vermont) and a company called
Protech Armored Products (located in Pittsfield, Massachusetts).
See id. Elliott performed much of that work from his home in New
Hampshire. See id.
-10- After Armor Holdings acquired Protech Armored Products,
Elliott worked on the integration of Protech into Armor Holdings
as a wholly-owned subsidiary. See id. ¶ 1 4 . Although Armor
Holdings provided Elliott with rental housing in Massachusetts
during at least part of the time that he was engaged in the
integration project, Elliott returned to his New Hampshire home
on weekends and performed some work while in New Hampshire. See
id.; Spiller Aff. Ex. C . Elliott also used his home office to
write several proposals for government and commercial contracts
on Protech’s behalf after that company became a subsidiary of
Armor Holdings. See Elliott Aff. ¶ 1 5 .
Elliott maintains that Armor Holdings was aware that he did
company-related work at his New Hampshire home. See id. ¶ 1 3 .
Armor Holdings has attested that it never requested, required, or
authorized Elliott to do work at home or otherwise perform work
in New Hampshire, and that to the extent that Elliott did s o , he
did so “for his own convenience.” Spiller Aff. ¶ 1 9 ; see also
-11- Spiller Reply Aff. ¶ 8 . Armor Holdings also has presented
evidence that throughout most of 1998, Elliott continued to have
an office at the company’s Florida headquarters. See Spiller
Aff. ¶ 1 9 .
-12- B. Marketing and Sales in New Hampshire by Representatives of Armor Holdings
Elliott also maintains that Armor Holdings conducted
business in New Hampshire by marketing and selling products
manufactured by its subsidiaries to various New Hampshire law
enforcement agencies. Specifically, Elliott presents evidence
that Armor Holdings engaged two regional sales representatives
whose territories included New Hampshire. See Elliott Aff. ¶¶
2 1 , 2 2 , 2 3 . One of these individuals, Stephen Monette, Jr.,
served as sales manager for the New England states from February
2 1 , 1997 to April 1 7 , 1999. See Monette Aff. (attached to Doc.
#9) ¶¶ 4 , 5 , 6, 14 and Ex. A . A second, unidentified person
acted as a New England sales representative between May 1998 and
April 1 7 , 1999. See id. ¶¶ 1 3 , 1 4 . According to Elliott, these
sales representatives regularly advertised, marketed, and sold in
New Hampshire products manufactured by Armor Holdings’s
-13- subsidiaries. See Elliott Aff. ¶¶ 1 8 , 21. 5 Elliott was not
personally involved in any of this sales activity. See Spiller
Aff. ¶¶ 6, 1 0 .
Monette has provided an affidavit in support of Elliott’s
jurisdictional claim in which he details his duties and
activities on behalf of Armor Holdings. As Armor Holdings’s
sales representative, Monette was responsible for marketing and
selling products manufactured by Armor Holdings’s wholly-owned
subsidiaries. See Monette Aff. ¶¶ 7 , 1 6 . He traveled to New
Hampshire approximately once per month to make sales calls and
perform product demonstrations. See id. ¶¶ 8 , 1 5 . Approximately
5 Armor Holdings maintains that it does not “have any employees, agents or sales representatives who perform their duties from New Hampshire,” that Monette “acted as an independent sales representative on behalf of [Armor Holdings’s] subsidiaries,” that Monette was based in Massachusetts, and that Monette “was never in New Hampshire as a representative of [Armor Holdings].” Spiller Aff. ¶¶ 3 , 9. Under the prima facie standard, however, I accept as true for the purposes of jurisdictional analysis Elliott’s evidence that Monette and the unnamed sales representative both acted for Armor Holdings in New Hampshire.
-14- three times per month, Monette mailed catalogues, flyers, and
brochures advertising the subsidiaries’ products to law
enforcement agencies located throughout New Hampshire. See id.
¶¶ 9, 1 5 . These efforts resulted in some sales to New Hampshire
purchasers. See id. ¶ 11 and Exs. B , C.6 Monette also marketed
the products to distributors that, in turn, marketed and sold
them to New Hampshire law enforcement agencies. See id. ¶ 1 0 .
Only a small fraction of the total sales of the
subsidiaries’ products were made in New Hampshire. The total New
Hampshire sales figures for 1998 amount to $7,150 out of
$41,312,237 in national sales, or about .01708% of the total.
See Spiller Aff. ¶ 5 . The sales figures for the first half of
1999 show a similar pattern, with only $9,050 out of $25,327,955
6 Although I am assuming for purposes of jurisdictional analysis that Monette was acting as a sales representative for Armor Holdings rather than for its subsidiaries, all but one of the invoices appended to Monette’s affidavit as proof of his New Hampshire sales were issued by Defense Technology Corporation of America, one of Armor Holdings’s subsidiaries. See Monette Aff. Exs. C , D.
-15- (or .036%) made to New Hampshire purchasers. See id. ¶ 6.
C. Armor Holdings’s Acquisition of Safariland, Inc.
Finally, Elliott claims that Armor Holdings did business in
New Hampshire by virtue of its acquisition of a company called
Safariland, which became another wholly-owned subsidiary of Armor
Holdings. According to Elliott, Safariland manufactures a
variety of law enforcement equipment, including body armor,
holsters, and belts. See Elliott Aff. ¶ 2 2 . Elliott has alleged
on information and belief that these products are sold in New
Hampshire. See id. Armor Holdings has provided the following
sales figures for Safariland: $45,949,635 in total sales in 1998,
$38,587.50 of which occurred in New Hampshire; $23,695,309 in
total sales from January to August 1999, $49,652.70 of which
occurred in New Hampshire. See Spiller Aff. ¶ 7 .
III. Discussion
For purposes of assessing personal jurisdiction over a
nonresident defendant, “a federal court exercising diversity
-16- jurisdiction ‘is the functional equivalent of a state court
sitting in the forum state.’” Sawtelle, 70 F.3d at 1387 (quoting
Ticketmaster, 26 F.3d at 2 0 4 ) . Accordingly, I must determine
whether jurisdiction is proper under both the New Hampshire long-
arm statute and the due process requirements of the federal
constitution. See id.; Foster-Miller, 46 F.3d at 144. The New
Hampshire long-arm statute applicable to foreign corporations,
see N.H. Rev. Stat. Ann. § 293-A:15.10 (Supp. 1998), has been
interpreted to be coextensive with federal constitutional limits
on jurisdiction. See Sawtelle, 70 F.3d at 1388 (citing McClary
v . Erie Engine & Mfg. Co., 856 F. Supp. 5 2 , 55 (D.N.H. 1994)).
As a result, “the traditional two-part personal jurisdiction
inquiry collapses into the single question of whether the
constitutional requirements of due process have been met.”
McClary, 856 F. Supp. at 5 5 . Therefore, I proceed directly to
the due process analysis.
The due process clause precludes a court from asserting
-17- jurisdiction over a defendant unless “the defendant’s conduct and
connection with the forum State are such that [it] should
reasonably anticipate being haled into court there.” World-Wide
Volkswagen Corp. v . Woodson, 444 U.S. 286, 297 (1980). The
“constitutional touchstone” for personal jurisdiction is “whether
the defendant purposefully established ‘minimum contacts’ in the
forum State.” Burger King Corp. v . Rudzewicz, 471 U.S. 462, 474
(1985) (citing International Shoe C o . v . Washington, 326 U.S.
310, 316 (1945)); see also Sawtelle, 70 F.3d at 1388. The
inquiry into “minimum contacts” is necessarily fact-specific,
“involving an individualized assessment and factual analysis of
the precise mix of contacts that characterize each case.”
Pritzker v . Yari, 42 F.3d 5 3 , 60 (1st Cir. 1994). A defendant
cannot be subjected to a forum state’s jurisdiction based solely
on “random,” “fortuitous,” or “attenuated” contacts. Burger
King, 471 U.S. at 475 (quoting Keeton v . Hustler Magazine, Inc.,
465 U.S. 7 7 0 , 774 (1984); World-Wide Volkswagen, 444 U.S. at 299)
-18- (internal quotation marks omitted). Rather, “it is essential in
each case that there be some act by which the defendant
purposefully avails itself of the privilege of conducting
activities within the forum State, thus invoking the benefits and
protections of its laws.” Id. (quoting Hanson v . Denckla, 357
U.S. 235, 253 (1958)).
A court may assert authority over a defendant by means of
either general or specific jurisdiction. See Massachusetts Sch.
of Law, 142 F.3d at 34 (citing Donatelli v . National Hockey
League, 893 F.2d 459, 462-63 (1st Cir. 1990)); Foster-Miller, 46
F.3d at 144. A defendant who has engaged in continuous and
systematic activity in a forum state is subject to general
jurisdiction in that forum with respect to all causes of action,
even those unrelated to the defendant’s forum-based activities.
See Phillips Exeter Academy v . Howard Phillips Fund, Inc., 196
F.3d 284, 288 (1st Cir. 1999) (citing Helicopteros Nacionales de
Colombia, S.A. v . Hall, 466 U.S. 408, 414 (1984); Donatelli, 893
-19- F.2d at 462-63). A court may exercise specific jurisdiction, by
contrast, only when the cause of action arises from, or relates
t o , the defendant’s contacts with the forum. See id.; Pritzker,
42 F.3d at 6 0 . “[T]he extent of the required jurisdictional
showing by a plaintiff depends upon whether the litigant is
asserting jurisdiction over a defendant under a theory of
‘general’ or ‘specific’ jurisdiction.” Sawtelle, 70 F.3d at 1387
n.3 (citing Ticketmaster, 26 F.3d at 204 n . 3 ) . Here, Elliott
contends that Armor Holdings is subject to both general and
specific jurisdiction in New Hampshire. See Mem. in Supp. of
Pl.’s Opp’n (Doc. # 9 ) at 1 2 .
-20- A. Specific Jurisdiction
The First Circuit has developed a tripartite test for
determining whether an exercise of specific jurisdiction comports
with due process. The analysis consists of an inquiry into (1)
relatedness, (2) purposeful availment (or “minimum contacts”),
and (3) reasonableness. See Massachusetts Sch. of Law, 142 F.3d
at 3 5 ; Nowak v . Tak How Invs., Ltd., 94 F.3d 708, 712-13 (1st
Cir. 1996). An affirmative finding on each of these three
elements is required to support an assertion of specific
jurisdiction. See Phillips Exeter, 196 F.3d at 288. However,
“the relative strength or weakness of the plaintiff’s showing on
the first two elements bears upon the third element (the overall
fairness of an exercise of jurisdiction).” Id. at 288 n.1
(citing Ticketmaster, 26 F.3d at 2 0 7 ) .
In a contract action such as Elliott’s, the mere existence
of a contractual relationship between an out-of-state defendant
and a forum-state plaintiff is insufficient, in itself, to
-21- establish jurisdiction in the plaintiff’s home forum. See Burger
King, 471 U.S. at 478; Phillips Exeter, 196 F.3d at 290; Ganis
Corp. of California v . Jackson, 822 F.2d 194, 197 (1st Cir.
1987); Bond Leather Co., Inc. v . Q.T. Shoe Mfg. Co., Inc., 764
F.2d 928, 933-34 (1st Cir. 1985). Under the “contract-plus”
analysis adopted by the Supreme Court in Burger King, the
contract between the parties is merely an intermediate step in an
ongoing process. See United Elec., Radio and Mach. Workers of
Am. v . 163 Pleasant S t . Corp., 960 F.2d 1080, 1090 (1st Cir.
1992) [hereinafter Pleasant S t . I ] (citing Burger King, 471 U.S.
at 4 7 9 ) , appeal after remand, 987 F.2d 39 (1st Cir. 1993); Ganis,
822 F.2d at 197 (same). Accordingly, to determine whether Armor
Holdings purposefully established minimum contacts with New
Hampshire, I must evaluate the parties’ “‘prior negotiations and
contemplated future consequences, along with the terms of the
contract and the parties’ actual course of dealing.’” Phillips
Exeter, 196 F.3d at 290 (quoting Burger King, 471 U.S. at 4 7 9 ) .
-22- Moreover, I must make my assessment of Armor Holdings’s New
Hampshire contacts in light of “all of the communications and
transactions between the parties, before, during and after the
consummation of the contract.” Ganis, 822 F.2d at 197. 6 With
these principles in mind, I apply the tripartite test for
specific jurisdiction.
1. Relatedness
Under the relatedness requirement, I must determine whether
Elliott’s claim arises out o f , or relates t o , Armor Holdings’s
6 In Ganis, the First Circuit considered a number of fact- specific “plus” factors in its “contract-plus” analysis, including: (1) the location where payments under the contract were to be sent; (2) a choice of law provision in the contract selecting the forum state’s laws as governing law; and (3) the use of form contracts that bore the plaintiff’s forum-state address. See 822 F.2d at 198. I discuss the first of these factors below, in the context of the relatedness requirement. The second and third factors do not apply to the facts of the present case, which involves both a written contract (the 1996 agreement) and an oral contract (the 1997 agreement), because: (1) the choice of law provision contained in the 1996 agreement designated New York law, not New Hampshire law, as governing, see Elliott Aff. Ex. B ¶ 11(i); and (2) the 1996 agreement lists Florida addresses for both Elliott and Armor Holdings. See id.
-23- New Hampshire contacts. See Phillips Exeter, 196 F.3d at 288;
Massachusetts Sch. of Law, 142 F.3d at 3 5 . This requirement,
which is “a flexible, relaxed standard,” Pritzker, 42 F.3d at 6 1 ,
is designed to focus my attention on the nexus between the
defendant’s forum-state contacts and the plaintiff’s claim. See
Nowak, 94 F.3d at 714; Sawtelle 70 F.3d at 1389. “The
relatedness requirement is not met merely because a plaintiff’s
cause of action arose out of the general relationship between the
parties; rather, the action must directly arise out of the
specific contacts between the defendant and the forum state.”
Sawtelle, 70 F.3d at 1389.
As a preliminary matter, I note that only one of the three
main categories of jurisdictional evidence -- the evidence that
Elliott engaged in work for Armor Holdings at his New Hampshire
home -- is relevant to specific jurisdiction. The evidence that
Armor Holdings marketed and sold products in New Hampshire and
acquired Safariland does not relate to Elliott’s claim in any
-24- way, and thus I consider it only in my analysis of general
jurisdiction.
In a contract case, “a court charged with determining the
existence vel non of personal jurisdiction must look to the
elements of the cause of action and ask whether the defendant’s
contacts with the forum were instrumental either in the formation
of the contract or in its breach.” Phillips Exeter, 196 F.3d at
289; see also Massachusetts Sch. of Law, 142 F.3d at 35
(formation); Pleasant S t . I, 960 F.2d at 1089 (same). The bulk
of the jurisdictional evidence produced by Elliott, including the
evidence that he engaged in work for Armor Holdings at his New
Hampshire home, does not bear on either the formation or breach
of any of the agreements that Elliott had with Armor Holdings.
Because this evidence relates to Elliott’s performance, i.e., the
subject matter of an agreement rather than its formation or
breach, it cannot satisfy the relatedness requirement.
In order to determine whether any of Armor Holdings’s New
-25- Hampshire contacts were instrumental to making or breaking
Elliott’s contract, I must first determine under which contract
Elliott is claiming a breach. In his original complaint filed in
state court, Elliott refers to both the 1996 written agreement
and the 1997 oral agreement, but does not clearly identify which
of the two contracts Armor Holdings allegedly breached. See
Pl.’s Compl. (part of Doc. #13) at 1-2. In his opposition to
Armor Holdings’s motion to dismiss, however, Elliott specifies
that his “claims relate to [Armor Holdings’s] breach of his
[1997] oral employment agreement.” Mem. in Supp. of Pl.’s Opp’n
(Doc. #9) at 1 4 . In any event, Elliott is clearly contending
that the 1997 agreement adopted the same terms concerning
compensation and benefits as were contained in the 1996
agreement.7 See id. at 3-4, 18-19; Elliott Aff. ¶ 1 0 ; Pl.’s
7 Armor Holdings disputes Elliott’s characterization of the 1997 agreement, arguing that it created a consulting relationship under which Elliott was to be paid on an hourly basis. See Spiller Aff. ¶ 1 6 ; Spiller Reply Aff. ¶ 5 . I credit Elliott’s account for the purpose of determining jurisdiction, without
-26- Compl. at 1 . Because Elliott’s underlying claim, read in the
most favorable light, appears to be that the 1997 agreement
provided for the continuation of an ongoing relationship
established under the 1996 agreement, I will consider both
agreements in my assessment of relatedness. See, e.g., Vetrotex
Certainteed Corp. v . Consolidated Fiber Class Prods. Co., 75 F.3d
147, 151-53 (3d Cir. 1996) (considering for jurisdictional
purposes both 1991 contract and 1992 contract, where latter
renewed relationship formed under former, in action alleging
breach only of the 1992 contract).
The 1996 agreement provides no support for Elliott’s
jurisdictional claim. By his own evidence, Elliott demonstrates
that he resided in Florida throughout the one-year period during
which the 1996 agreement was in effect. See Elliott Aff. ¶¶ 5 ,
7 , 9. Armor Holdings has presented uncontradicted evidence that
expressing any opinion on the merits of Elliott’s underlying claims.
-27- the 1996 agreement “was negotiated, agreed t o , and entered [into]
in Florida.” Spiller Aff. ¶ 1 2 . Armor Holdings sent the
December 1 6 , 1996 letter informing Elliott that the 1996
agreement would not be renewed to Elliott’s Florida address. See
Elliott Aff. Ex. C . There is simply no evidence in the record
that Armor Holdings had any contacts with New Hampshire in
relation to the formation or termination of the 1996 agreement.8
Moreover, Elliott has provided little evidence linking
either the formation or breach of the 1997 agreement with any New
Hampshire contacts made by Armor Holdings. The record is silent
as to where the negotiations for the 1997 agreement took place.
See Elliott Aff. ¶ 1 0 ; Spiller Aff. ¶ 1 6 ; Spiller Reply Aff. ¶¶
4-6. Certainly there is no evidence that the negotiations took
place in New Hampshire or by means of any communications directed
8 The 1996 agreement also obligated Armor Holdings to reimburse Elliott for his monthly dock rental at the Pablo Creek Marina, in Florida. See Elliott Aff. Ex. B ¶ 4 ( d ) ; Spiller Aff. ¶ 12 and Ex. B ¶ 4 ( d ) .
-28- into or out of New Hampshire. Rather, it appears that the
negotiations took place some time prior to Elliott’s
establishment of his New Hampshire residence. See Elliott Aff.
¶¶ 2 , 1 0 . Under the contract-plus analysis discussed above,
“[t]he location of the negotiations is vitally important to the
jurisdictional inquiry in a case like this one. If the
negotiations occurred outside the forum state, their existence
cannot serve to bolster the argument for the assertion of
jurisdiction in the forum.” Pleasant S t . I, 960 F.2d at 1090.
The record contains some evidence suggesting a link between
the alleged breach of the 1997 agreement and Armor Holdings’s New
Hampshire contacts. The crux of Elliott’s underlying contract
claim is that Armor Holdings breached the parties’ agreement by
failing to provide him with certain stock options, benefits, and
records. Elliott has proffered evidence that he discussed the
issue of his stock options in telephone conversations with
Jonathan Spiller and other Armor Holdings employees. See Elliott
-29- Aff. ¶ 1 1 . These telephone calls lend scant support to Elliott’s
jurisdictional claim, however, because Elliott does not specify
which party initiated the calls, nor does he attest that he was
in New Hampshire when the calls were made.
More important to my analysis is correspondence between
Armor Holdings and Elliott at his New Hampshire home. On
November 9, 1998, Elliott sent a letter from New Hampshire to
Armor Holdings CEO Jonathan Spiller, in which Elliott raised the
issue of his stock options. See id. ¶ 11 and Ex. D. On March
1 8 , 1999, Elliott sent a letter to Jennifer Gouin, Armor
Holdings’s vice president of human resources, requesting issuance
of the stock options, payment for the vacation time, and delivery
of the personnel records that are the subject of the present
suit. See Spiller Reply Aff. Ex. B . On April 7 , 1999, Gouin
responded in a letter sent to Elliott at his New Hampshire home.
In her letter, Gouin communicated the company’s contention that
Elliott was not entitled to the stock options, vacation pay, or
-30- personnel records that he requested. See id. Ex. A .
The transmission of information into New Hampshire by mail
or telephone is undoubtably a forum-related contact for due
process purposes. See Massachusetts Sch. of Law, 142 F.3d at 3 6 ;
Sawtelle, 70 F.3d at 1389-90. The question here is whether the
correspondence and any telephone calls that Armor Holdings
employees may have placed to Elliott in New Hampshire were
instrumental to the breach of the 1997 agreement. See Phillips
Exeter, 196 F.3d at 289. The answer to this question is n o .
Properly construed, the correspondence and any related telephone
calls constitute notice to Elliott of the alleged breach, rather
than the actual mechanism of breach. As such, they were not
instrumental in causing the breach and do not satisfy the
relatedness requirement. C f . Ticketmaster, 26 F.3d at 207
(noting that the relatedness requirement focuses on “the element
of causation”).
Finally, Elliott maintains that the breach of the 1997
-31- agreement occurred in New Hampshire because that is the place
where he felt its effects. See Mem. in Supp. of Pl.’s Opp’n
(Doc. #9) at 1 5 . Elliott thereby suggests, although he does not
provide any evidence to support the suggestion, that the
compensation and benefits that are the subject of his underlying
claim were payable to him in New Hampshire. In a recent opinion,
the First Circuit noted that “courts repeatedly have held that
where payments are due under a contract is a meaningful datum for
jurisdictional purposes.” Philips Exeter, 196 F.3d at 291; see
also Ganis, 822 F.2d at 198. However, as the court went on to
explain, “that fact alone does not possess decretory
significance.” Phillips Exeter, 196 F.3d at 291 (citing Kulko v .
Superior Court, 426 U.S. 8 4 , 9 3 , 97 (1978); Hanson, 357 U.S. at
252; Kerry Steel, Inc. v . Paragon Inds., Inc., 106 F.3d 147, 152
(6th Cir. 1997)). Elliott, like the plaintiff in Phillips
Exeter, has failed to make a persuasive argument that the
location where payments were due is dispositive of the
-32- jurisdictional claim. See id. This is especially true in the
present case, where the parties’ evidentiary submissions do not
clearly establish that payments were due in New Hampshire.
In sum, I conclude that Elliott has not made the necessary
prima facie showing under the relatedness requirement.9 However,
to ensure that Elliott’s jurisdictional claim receives the
fullest consideration, I proceed to the purposeful availment
9 Elliott’s reliance on Pelchat v . Sterilite Corp., 931 F. Supp. 939 (D.N.H. 1996) to show relatedness, see Mem. in Supp. of Pl.’s Opp’n (Doc. #9) at 14-15, is misplaced. Pelchat involved a New Hampshire employee’s claim that her Massachusetts employer violated her rights under the Family and Medical Leave Act (FMLA) by harassing her during her FMLA leave by means of repeated telephone calls to her New Hampshire home. See id. at 942 & n.1. Assuming, without deciding, that the employer’s telephone calls constituted interference with the plaintiff’s benefits under the FMLA, the court concluded that the plaintiff had satisfied the relatedness requirement. See id. at 945. Pelchat is clearly distinguishable from the present case on at least two grounds: (1) because the jurisdictional analysis in Pelchat focused on a claim under the FMLA, rather than a contract claim, the requirement that the defendant’s forum-related contacts be instrumental to the formation or breach of a contract did not apply; and (2) the employer’s New Hampshire contacts in Pelchat, unlike Armor Holdings’s New Hampshire contacts in the present case, were directly related to the plaintiff’s claim.
-33- prong of the tripartite test.
2. Purposeful Availment
Under the second element of the tripartite test, I must
determine whether Armor Holdings’s forum-related contacts
constitute a purposeful availment of the privilege of conducting
activities in New Hampshire, thereby invoking the benefits and
protections afforded by New Hampshire’s laws. See Burger King,
471 U.S. at 475; Phillips Exeter, 196 F.3d at 288; Nowak, 94 F.3d
at 712-13. The purposeful availment requirement focuses on
“whether a defendant ‘has engaged in any purposeful activity
related to the forum that would make the exercise of jurisdiction
fair, just, or reasonable.’” Sawtelle, 70 F.3d at 1391 (quoting
Rush v . Savchuk, 444 U.S. 320, 329 (1980)). Its function is to
ensure “that personal jurisdiction is not premised solely upon a
defendant’s ‘random, isolated, or fortuitous’ contacts with the
forum state.” Id. (quoting Keeton, 465 U.S. at 7 7 4 ) .
Purposeful availment rests on two cornerstones:
-34- voluntariness and foreseeability. See id.; Ticketmaster, 26 F.3d
at 207. First, the defendant’s contacts with the forum state
must be voluntary. See Nowak, 94 F.3d at 716. This requirement
is not satisfied when those contacts are “based on the unilateral
actions of another party or third person.” Id.; see also Burger
King, 471 U.S. at 475 (citing Helicopteros, 466 U.S. at 4 1 7 ) . In
a contract case, “the place where the contract is to be
performed” may be “a weighty consideration” in determining
jurisdiction. Command-Aire Corp. v . Ontario Mech. Sales and
Serv. Inc., 963 F.2d 9 0 , 94 (5th Cir. 1992). However, “[i]f . .
. the forum plaintiff’s decision to perform [his] contractual
obligations within [his] own forum state is totally unilateral,
it cannot be viewed as purposeful on the part of the nonresident
and the weight is necessarily diminished.” Id. In the present
case, Elliott’s performance of work for Armor Holdings at his New
Hampshire residence resulted entirely from Elliott’s unilateral
decision to acquire a residence in New Hampshire and to work at
-35- his home office. As noted above, Armor Holdings did not request,
require, or authorize Elliott to work at his New Hampshire home
or anywhere else in New Hampshire. See Spiller Aff. ¶ 1 9 ;
Spiller Reply Aff. ¶ 8 . Because Elliot’s performance of work in
New Hampshire was based on a unilateral decision that he made for
his own convenience, without any action on Armor Holdings’s part,
he has failed to show voluntariness.10
10 I have already determined that the correspondence that Armor Holdings had with Elliott in New Hampshire (as well as any telephone calls that Armor Holdings may have made to Elliott’s New Hampshire home) are not related to the formation or breach of any agreement between the parties. I note here that these isolated and attenuated communications do not constitute a purposeful availment of the privilege of conducting activities in New Hampshire. See Massachusetts Sch. of Law, 142 F.3d at 36 (concluding that defendant’s participation in telephone conversation with in-forum person and subsequent mailing into forum, combined with participation in meeting in forum, were “insufficient to establish purposeful availment”); U.S.S. Yachts, Inc. v . Ocean Yachts, Inc., 894 F.2d 9, 1 1 , 12 (1st Cir. 1990) (concluding that three letters sent into forum by defendant were insufficient to support personal jurisdiction over defendant); Kerry Steel, 106 F.3d at 151 (finding defendant’s telephone calls and letters into forum state to be “precisely the sort of ‘random,’ ‘fortuitous’ and ‘attenuated’ contacts that the Burger King Court rejected as a basis for haling non-resident defendants
-36- Moreover, “[e]ven if a defendant’s contacts with the forum
are deemed voluntary, the purposeful availment prong of the
jurisdictional test investigates whether the defendant benefitted
from those contacts in a way that made jurisdiction foreseeable.”
Phillips Exeter, 196 F.3d at 292 (citing Ticketmaster, 26 F.3d at
207). An exercise of personal jurisdiction over a nonresident
defendant is foreseeable, and therefore appropriate, “where the
defendant purposefully derives economic benefits from its forum-
state activities,” Nowak, 94 F.3d at 7 1 7 , or makes “a purposeful
decision . . . to ‘participate’ in the local economy.” Bond
Leather, 764 F.2d at 934. Similarly, the assertion of personal
jurisdiction over a nonresident defendant is foreseeable when
that defendant has reached out to establish a continuing
relationship or obligation between itself and a resident of the
forum state. See Burger King, 471 U.S. at 473, 476; Sawtelle, 70
into foreign jurisdictions”) (quoting LAK, Inc. v . Deer Creek Enters., 885 F.2d 1293, 1301 (6th Cir. 1989) (internal quotation marks omitted)).
-37- F.3d at 1393.
In the present case, there is no evidence that Armor
Holdings purposefully derived any economic benefit or did any
business in New Hampshire in relation to Elliott’s employment.11
Nor is there any indication that Armor Holdings intentionally
reached out to New Hampshire to establish continuing obligations
or relationships with residents of the state. Elliott has not
produced any evidence that he was a New Hampshire resident at the
time he and Armor Holdings entered into any contractual
relationship. Rather, the record indicates that Elliott
established his New Hampshire residence only after he and Armor
Holdings entered into the 1997 agreement, the final contract
between the parties. See Elliott Aff. ¶¶ 2 , 1 0 . The
jurisdictional evidence establishes that Elliott, acting on his
11 While Elliott has produced evidence that representatives of Armor Holdings advertised, marketed, and sold products manufactured by the company’s subsidiaries in New Hampshire, these activities bear no relation to Elliott’s duties, which involved business operations, not sales. See Spiller Aff. ¶ 6.
-38- own initiative, sometimes performed work for Armor Holdings at
the New Hampshire residence he established after entering into
his final contract with the company. Based on these facts, Armor
Holdings could not have foreseen that it would be subject to suit
in New Hampshire in an action relating to Elliott’s services or
compensation. Accordingly, I conclude that Elliott has failed to
demonstrate foreseeability.
Because Elliott has not made a prima facie showing of either
voluntariness or foreseeability, he has not met the purposeful
availment requirement for personal jurisdiction. Having
determined that Elliott has failed to make the required showing
under both the relatedness requirement and the purposeful
availment requirement, I need not address the final element of
the personal jurisdiction test. See Phillips Exeter, 196 F.3d at
288, 292. Accordingly, I conclude that I lack the authority to
exercise specific jurisdiction over Armor Holdings.
B. General Jurisdiction
-39- A court may assert general jurisdiction over a defendant
even when the plaintiff’s claim is not related to the defendant’s
forum-based conduct, if the defendant has engaged in “the
‘continuous and systematic’ pursuit of general business
activities in the forum state.” Glater v . Eli Lilly & Co., 744
F.2d 213, 216 (1st Cir. 1984) (citing Perkins v . Benguet Consol.
Mining Co., 342 U.S. 437, 448 (1952)); see also Helicopteros, 466
U.S. at 415-16; Massachusetts Sch. of Law, 142 F.3d at 3 4 . In
other words, although an exercise of general jurisdiction does
not require relatedness, it does require that the defendant’s
contacts with the forum state be much more extensive than the
“minimum contacts” necessary for specific jurisdiction. See
Donatelli, 893 F.2d at 463 (noting that “‘[a]lthough minimum
contacts suffice in and of themselves for specific jurisdiction .
. . , the standard for general jurisdiction is considerably more
stringent’”) (quoting Glater, 744 F.2d at 216) (alteration in
original).
-40- Because relatedness is not germane to general jurisdiction,
I must consider all of Elliott’s jurisdictional facts when
assessing whether this court may exercise general jurisdiction
over Armor Holdings. As described in detail above, Elliott has
produced (1) evidence that he performed some work activities for
Armor Holdings at his New Hampshire home; (2) evidence that sales
representatives acting for Armor Holdings advertised, marketed,
and sold in New Hampshire products manufactured by Armor
Holdings’s wholly-owned subsidiaries; and (3) evidence that Armor
Holdings acquired Safariland, a company that sold its products in
New Hampshire. I consider the second and third categories of
evidence first, then turn to the first.
The First Circuit’s decisions in analogous cases demonstrate
that a nonresident defendant that advertises and uses sales
representatives in a forum state but sells an insubstantial
amount of its products in the forum state is not engaged in the
type of continuous and systematic activity that would subject it
-41- to general jurisdiction in the forum. See, e.g., Noonan v .
Winston Co., 135 F.3d 8 5 , 92-94 (1st Cir. 1998) (holding that
regular solicitations of business from forum-state companies,
travel to forum state to develop business relationship with local
company, and approximately $585,000 of in-state orders were not
sufficient to authorize general jurisdiction); Glater, 744 F.2d
at 215, 217 (concluding that advertising in trade journals
circulated in state, employment of eight sales representatives in
state, and sale of products to distributors in state were not
sufficient to support general jurisdiction); Seymour v . Parke,
Davis & Co., 423 F.2d 584, 585, 587 (1st Cir. 1970) (concluding
that employment of approximately six salesmen in state and
advertisement in state were insufficient to support general
jurisdiction). In light of these precedents, I conclude that
Armor Holdings use of sales representatives to sell to New
Hampshire purchasers a relatively small amount of the products
manufactured by its subsidiaries, combined with the acquisition
of Safariland, does not constitute the continuous and systematic
-42- pursuit of general business activities in New Hampshire.12
Elliott also seeks to add the work that he performed for
Armor Holdings at his New Hampshire residence to the calculus of
contacts for general jurisdiction. This effort is unavailing.
First, I have already determined that Elliott’s use of his home
office to engage in work for Armor Holdings was a unilateral
action that does not constitute a purposeful “minimum contact”
with New Hampshire by Armor Holdings. Therefore, Elliott’s New
Hampshire activities cannot be considered in the calculation of
general jurisdiction. Second, even in combination with the other
evidence of Armor Holdings’s New Hampshire activities, Elliott’s
performance of work in New Hampshire does not lift his
jurisdictional claim to the high standard required for an
assertion of general jurisdiction.
12 The parties have devoted substantial energy to disputing whether New Hampshire activities of Armor Holdings’s subsidiaries are attributable to the parent company. This issue is not relevant to the jurisdictional analysis in this case because Elliott has produced evidence that supports a reasonable inference that the sales representatives who sold the sub- sidiaries’ products were acting for Armor Holdings. Accordingly, I need not address the question of veil-piercing and attribution.
-43- Accordingly, I conclude that Elliott has failed to make the
showing necessary for an exercise of general jurisdiction over
Armor Holdings.
IV. Conclusion
Because Elliott has failed to satisfy the requirements of
relatedness and purposeful availment, I cannot exercise specific
jurisdiction over Armor Holdings. Moreover, because Armor
Holdings is not engaged in continuous and systematic activities
in New Hampshire, I cannot assert general jurisdiction over the
company. Accordingly, Armor Holdings’s motion to dismiss (Doc.
#5) is granted.
SO ORDERED.
Paul Barbadoro Chief Judge
January 1 2 , 2000
cc: Tara Connors Schoff, Esq. Peter S . Cowan, Esq.
-44-