Kinetic Co., Inc. v. BDO EOS SVETOVANJE, DOO

361 F. Supp. 2d 878, 2005 U.S. Dist. LEXIS 4795, 2005 WL 701051
CourtDistrict Court, E.D. Wisconsin
DecidedMarch 18, 2005
Docket04-CV-581
StatusPublished
Cited by1 cases

This text of 361 F. Supp. 2d 878 (Kinetic Co., Inc. v. BDO EOS SVETOVANJE, DOO) is published on Counsel Stack Legal Research, covering District Court, E.D. Wisconsin primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Kinetic Co., Inc. v. BDO EOS SVETOVANJE, DOO, 361 F. Supp. 2d 878, 2005 U.S. Dist. LEXIS 4795, 2005 WL 701051 (E.D. Wis. 2005).

Opinion

DECISION AND ORDER

RANDA, Chief Judge.

The plaintiff, the Kinetic Co., Inc., (“Kinetic”) commenced this action against the defendant, BDO EOS Svetovanje, d.o.o., (“EOS”) a Slovenian corporation, in Milwaukee County Circuit Court. Kinetic seeks damages for unjust enrichment and a declaratory judgment that EOS cannot force Kinetic to arbitrate and that Kinetic does not owe the sums claimed by EOS. Alleging federal jurisdiction under 28 U.S.C. § 1332, because the parties are citizens of Wisconsin and a foreign state, respectively, and the amount in controversy, exclusive of costs, exceeds $75,000, EOS removed the action to this Court.

Motion to Dismiss for Lack of Personal Jurisdiction

Invoking Fed.R.Civ.P. 12(b)(2), EOS seeks dismissal of Kinetic’s complaint. EOS argues that the Court lacks personal jurisdiction over EOS pursuant to Wis. Stat. § 801.05 and that this Court’s exercise of personal jurisdiction over EOS would violate due process. Further, EOS argues that the parties agreed to arbitrate all disputes and that a previously filed arbitration proceeding pending in Geneva, Switzerland presents the issues raised in *880 Kinetic’s complaint. Kinetic opposes the motion. Both parties have submitted affidavits in support of their respective positions, which reveal factual conflicts.

Applicable Law

In ruling on a motion to dismiss for lack of personal jurisdiction, courts are not limited to the facts set forth in the complaint, but rather may receive and consider affidavits from both parties. Nelson v. Park Indus., Inc., 717 F.2d 1120, 1123 (7th Cir.1983); see also, Met-L-Wood Corp. v. SWS Indus., Inc., 594 F.Supp. 706, 708 n. 5 (N.D.Ill.1984). The Court is required to consider the pleadings and affidavits in the light most favorable to the plaintiff. See Jacobs/Kahan & Co. v. Marsh, 740 F.2d 587, 589 (7th Cir.1984). When deciding such a motion solely on the basis of the parties’ written materials, the plaintiff need only show a prima facie case of personal jurisdiction and is entitled to have all inferences about material jurisdictional facts resolved in its favor. Purdue Research Found. v. Sanofi-Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir.2003); Wisconsin Elec. Mfg. Co., Inc. v. Pennant Prods., 619 F.2d 676, 677 n. 1 (7th Cir.1980).

Relevant Facts 1

Kinetic, a Wisconsin corporation, engages in the industrial knife production business. (Compl.t 1.) EOS, 2 a Slovenian corporation, engages in legal,' accounting, and business purchase consultation services in Slovenia. (Id. at ¶ 2.) EOS has 39 employees — all of whom are employed in Slovenia. (Aff. of Andrej Marine [Marine Aff.] ¶ 2.) EOS has never employed anyone in the United States. (Id. at ¶ 2.)

EOS has never been authorized, licensed, registered or chartered to transact any business in Wisconsin. (Id. at ¶ 3.) EOS has never had any place of business in the United States and has never maintained a post office box, a mailing address, a telephone listing or a bank account in Wisconsin. (Id.) EOS has never employed any agent to solicit business in Wisconsin and does not have an agent for service in Wisconsin. (Id.)

EOS and Kinetic met through an intermediary. EOS and Arthur Andersen & Co., Societe Cooperative (“Arthur Andersen SC”) entered into a “Correspondent Agreement — Solvenia” in October 1995. (Marine Aff. II ¶ 2 & Ex. A.) The introduction to the agreement states that Arthur Andersen SC wants to establish a relationship with a firm able to provide professional accounting, auditing and tax consulting services in Slovenia to Andersen Worldwide clients with operations in Slovenia, and that EOS wants to establish a relationship with Andersen Worldwide to provide services to EOS clients having operations outside Slovenia. (Marine Aff. II ¶ 2 & Ex. A at 1 [unnumbered].)

The agreement contains a provision entitled “Referral of Client Engagements.” That provision states, in part: “[i]nquiries received by Andersen Worldwide offices concerning professional assistance in SLOVENIA related to accounting, auditing and tax-consulting, which would be appropriate for referral, will be referred on a non-exclusive basis to EOS.” (Marine Aff. II ¶ 3 & Ex. A at 2.) (emphasis added). The “Referral of Client Engagements” provision also contains a reciprocal nonexclusive referral provision for referral of inquiries, received by EOS concerning *881 “professional assistance outside SLOVENIA,” to Andersen Worldwide, when appropriate. (Id.)

The agreement between EOS and Arthur Andersen SC further states: “Any and all disputes which cannot be settled amicably, including any ancillary claims of either party, arising out of or in connection with the negotiation, execution, interpretation, performance or non-performance of [the] Agreement (including the validity, scope, and enforceability of [the] arbitration provision) shall be solely and finally settled by a single arbitrator in Geneva, Switzerland unless the parties agree on another location.” (Marine Aff. II ¶ 4 & Ex. A at 7.)

Interaction between EOS and Kinetic began in September 2000, when EOS and Kinetic engaged in negotiations to explore Kinetic’s purchase of SZ Nozi Ravne, d.d.o. (“Nozi”) — a state-owned Slovenian producer of industrial knives that was being privatized. (Compl. ¶ 3; Marine Aff. ¶ 5.) The relationship between the parties was initiated by the Milwaukee office of Arthur Andersen, LLC (“Arthur Ander-' sen”). (Aff. of Joseph Masters [Masters Aff.] ¶ 16). Joseph Masters (“Masters”), president of Kinetic, “understood” that by retaining EOS, Kinetic was retaining Arthur Andersen’s partner in Slovenia. (Id. at 17.)

Representatives of Kinetic, including Masters, traveled to Slovenia to meet with Marine and other EOS representatives. (Marine Aff. ¶ 5.) Igor Simac (“Simac”), an EOS representative, was assigned to represent Kinetic’s interest in the purchase of Nozi. (ComplV 11.) Further discussions between EOS and Kinetic ensued by phone and e-mail. (Marine Aff. ¶ 6.)

In October 2001, EOS began providing services to Kinetic in Slovenia in connection with Kinetic’s attempt to acquire Nozi. (Marine Aff. ¶ 6.) Prior to October 1, 2001, EOS and Kinetic tried, without success, to enter into a consulting agreement. (Masters Aff.

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361 F. Supp. 2d 878, 2005 U.S. Dist. LEXIS 4795, 2005 WL 701051, Counsel Stack Legal Research, https://law.counselstack.com/opinion/kinetic-co-inc-v-bdo-eos-svetovanje-doo-wied-2005.