Interstate Food Processing Corp. v. Pellerito Foods, Inc.

622 A.2d 1189, 1993 Me. LEXIS 67
CourtSupreme Judicial Court of Maine
DecidedApril 12, 1993
StatusPublished
Cited by59 cases

This text of 622 A.2d 1189 (Interstate Food Processing Corp. v. Pellerito Foods, Inc.) is published on Counsel Stack Legal Research, covering Supreme Judicial Court of Maine primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Interstate Food Processing Corp. v. Pellerito Foods, Inc., 622 A.2d 1189, 1993 Me. LEXIS 67 (Me. 1993).

Opinion

ROBERTS, Justice.

Pellerito Foods, Inc., appeals from a default judgment in favor of Interstate Food Processing Corporation entered in the Superior Court (Aroostook County, Pierson, J.). Pellerito contends that the court erred in denying its motion to set aside the default and the default judgment and in denying its motion to dismiss for lack of personal jurisdiction. We conclude that the court properly denied the motion to dismiss but erred in denying Pellerito’s motion to set aside the default judgment. Accordingly we vacate the judgment.

This case arises out of a contract between Pellerito Foods, Inc., a Michigan corporation with a principal place of business in Detroit, Michigan, and Interstate Food Processing Corporation, a Maine corporation with a principal place of business in Fort Fairfield, whereby Interstate agreed to develop a private product label for Pel-lerito and to ship potato products under that label to Pellerito’s Michigan offices. Interstate developed the private label and made six shipments to Pellerito. Pellerito, however, claimed the products were defective and refused to pay.

Interstate commenced this action, alleging a breach of contract and seeking payment of $12,967.84. Interstate agreed to Pellerito’s request for a 30-day extension of the time within which to file an answer because Pellerito had not yet retained Maine counsel. Pellerito, however, failed to file an answer within the extended period, and a default was entered on Interstate’s application. A default judgment was then entered by the clerk of the Superior Court. Pellerito’s subsequent motions to dismiss for lack of personal jurisdiction and to set aside the default judgment were denied. This appeal followed.

I.

The jurisdictional reach of Maine’s long-arm statute, 14 M.R.S.A. § 704-A (1980), is coextensive with the permissible exercise of personal jurisdiction under the due process clause of the fourteenth amendment. See Frazier v. Bankamerica Int’l, 593 A.2d 661, 662 (Me.1991); Caluri v. Rypkema, 570 A.2d 830, 831 (Me.), cert. denied, 498 U.S. 818, 111 S.Ct. 62, 112 L.Ed.2d 37 (1990). In order to exercise personal jurisdiction over a nonresident defendant consistent with the requirements of due process, we must determine that 1) Maine has a legitimate interest in the subject matter of the controversy; 2) the defendant, by its conduct, should reasonably have anticipated litigating in Maine; and 3) the exercise of jurisdiction by Maine’s courts would comport with “traditional notions of fair play and substantial justice.” Frazier, 593 A.2d at 662; Harriman v. Demoulas Supermarkets, Inc., 518 A.2d 1035, 1036 (Me.1986), cert. denied, 481 U.S. 1048, 107 S.Ct. 2178, 95 L.Ed.2d 835 (1987). The plaintiff bears the burden of establishing that jurisdiction is proper under the first two parts of the test. Electronic Media Int’l v. Pioneer Communications of America, Inc., 586 A.2d 1256, 1258 (Me.1991). The burden then shifts to the defendant to show that jurisdiction is improper under the third part. Id. at 1258-59. When there has been no testimonial hearing and the court proceeds on the parties’ pleadings and affidavits, the plaintiff need only make a prima facie showing that jurisdiction exists, and the plaintiff’s written allegations of jurisdiction are to be construed in its favor. Id. at 1259.

*1192 As to the first part of the test, Maine certainly has an interest in providing its citizens with a means of redress against nonresidents. See Frazier, 593 A.2d at 663. Moreover, given its importance to Maine’s economy, the state has a legitimate interest in protecting its potato industry. Pellerito, however, argues that Interstate has failed to demonstrate the requisite minimum contacts between Pellerito and Maine to satisfy the second part of the test. For a foreign corporation to be subject to Maine’s jurisdiction, “due process demands that the corporation have sufficient contacts with [Maine] to ‘make it reasonable ... to require the corporation to defend the particular suit which is brought [here].' ” Harriman, 518 A.2d at 1037 (quoting International Shoe Co. v. Washington, 326 U.S. 310, 317, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945)). The defendant’s contacts may not “result solely from the ‘unilateral activity of another party.’ ” Id. (quoting Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 417, 104 S.Ct. 1868, 1873, 80 L.Ed.2d 404 (1984)). Rather, it is essential that the defendant purposefully avail itself of “the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474-75, 105 S.Ct. 2174, 2183, 85 L.Ed.2d 528 (1985). This requirement is met “[w]hen a defendant ‘purposefully directs his activities at residents of a forum’ by ‘deliberately engaging in significant activities’ in that forum or by ‘creating continuing obligations between himself and residents’ of the forum.” Harriman, 518 A.2d at 1037 (quoting Burger King, 471 U.S. at 473-75, 105 S.Ct. at 2182-84).

Although Pellerito is not authorized to do business in Maine and does not have or maintain any property or other business facility here, Interstate has sustained its burden with respect to the second part of the test. Interstate’s affidavits allege that Pellerito contacted Interstate’s plant in Fort Fairfield to solicit a commitment to develop a private product label for Pellerito and to ship potato products under that label to Pellerito’s Michigan offices. Pelleri-to’s active solicitation of Interstate’s business demonstrates purposeful involvement in Maine because Pellerito had reached out beyond one state and created a continuing relationship with a resident of Maine. Id. Moreover, by requiring Interstate to attach Pellerito’s private label to their products, Pellerito exercised control over Interstate’s performance, which also demonstrates purposeful involvement in Maine. Id. at 1038; Caluri, 570 A.2d at 833. Interstate’s affidavits further allege that Pellerito’s president made a number of telephone calls to Interstate’s Fort Fairfield plant with regard to the development of the private label and to request changes in orders prior to shipment. This action demonstrates that the ongoing business relationship between the parties was not the result of unilateral action by Interstate. See Harriman, 518 A.2d at 1037.

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622 A.2d 1189, 1993 Me. LEXIS 67, Counsel Stack Legal Research, https://law.counselstack.com/opinion/interstate-food-processing-corp-v-pellerito-foods-inc-me-1993.