Office Dimensions—Louisiana, Inc. v. King

718 So. 2d 1052, 1998 La. App. LEXIS 2593, 1998 WL 646987
CourtLouisiana Court of Appeal
DecidedSeptember 23, 1998
DocketNo. 31139-CW
StatusPublished
Cited by3 cases

This text of 718 So. 2d 1052 (Office Dimensions—Louisiana, Inc. v. King) is published on Counsel Stack Legal Research, covering Louisiana Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Office Dimensions—Louisiana, Inc. v. King, 718 So. 2d 1052, 1998 La. App. LEXIS 2593, 1998 WL 646987 (La. Ct. App. 1998).

Opinion

h CARAWAY, Judge.

Two of the three plaintiffs in this action, Office Dimensions, Inc. (“OD”) and Eubanks Custom Builders, Inc. (“ECB”), seek review of the trial court’s dismissal of their claims for lack of personal jurisdiction over the defendant. OD and ECB joined as plaintiffs with Office Dimensions-Louisiana, Inc. (“ODLa”) against the defendant, Charles E. King, a Tennessee resident, in a dispute over each corporation’s stock purchase agreement with King. Appellants complain that the trial court erred in concluding that King, while subject to “specific” personal jurisdiction for the claim of ODLa, was not subject to the “general” personal jurisdiction of the Louisiana court with respect to their two claims. Finding a lack of general jurisdiction, we affirm the judgment of the trial court.

Facts

King is a shareholder in three separate corporations engaged in the manufacture of mobile office facilities. Only one of the corporations, Office Dimensions-Louisiana, Inc., does business in Louisiana and is, as indicated by its name, a Louisiana corporation with a facility in Cullen, Louisiana. OD is a Tennessee corporation with its principal operations in Tennessee, and ECB is a Georgia corporation with its principal operations in Georgia. King resides in Tennessee and has never resided in Louisiana.

ECB and ODLa are owned by King and three other shareholders, William S. Yeaman, Justo F. Cadiz, and Thomas P. Eubanks. These individuals, with the exception of Eu-banks, also own OD. Each of the corporations entered into stock purchase or stock restriction agreements with each of their respective shareholders. The plaintiffs’ petition alleges that the separate but largely identical agreements grant each corporation the option to purchase the shares of any shareholder who ^disassociates himself from the management, operation or employment of the corporation. Each agreement provides that the purchase price will be finally and conclusively determined by an independent certified public accountant regularly engaged by the corporation and will be based upon the “book value” of each corporation. The OD and ECB agreements both have choice of law provisions requiring Tennessee law to govern any dispute arising out of the agreements, while the ODLa agreement states that Louisiana law will govern the contract.

The petition alleges that on July 27, 1997, King disassociated himself from the management, operation and employment of each cor[1054]*1054poration. Thereafter, when the three corporations allegedly exercised their options to purchase King’s shares, King rejected the tender precipitating this action in the district court in Louisiana.

King met the plaintiffs’ petition with the declinatory exception to the personal jurisdiction over the defendant, as well as dilatory exceptions of prematurity and improper cu-mulation of actions. At the hearing, in lieu of testimony, both sides presented evidence by affidavit. Counsel for King stated that the exception to personal jurisdiction with respect to the claim of ODLa was abandoned, leaving only the exceptions to personal jurisdiction over the defendant regarding the claims of OD and ECB, and the exceptions of prematurity and improper cumulation of actions.

The affidavit of Yeaman stated that before the 1995 incorporation of ODLa, northwest Louisiana was identified (presumably by the common shareholders of ECB and OD) as a potential location to expand their business by adding another manufacturing facility. King was responsible for investigating and acquiring a site and made a number of trips to Louisiana for that purpose. He engaged the services 13oi a Louisiana realtor and dealt directly with representatives of the North Louisiana Industrial Park in Webster Parish. The contacts included personal visits, telephone communications and written correspondence.

After the incorporation of ODLa and until his disassociation with the business in July of 1997, King served as president of ODLa and was directly responsible for its management and operation. Yeaman identified numerous incidences in which King transacted business on behalf of ODLa, including the drawing of checks on ODLa’s local bank account. Reimbursement records were introduced for King’s expenses incurred during eight trips King made to Louisiana as president of ODLa. The duration of these trips averaged three to five days and totaled approximately thirty days over the two-year period.

Perhaps the largest collection of “contacts” with Louisiana were King’s telephone calls. Plaintiffs submitted telephone and fax logs indicating that King spoke with the Louisiana office in Cullen by telephone from his Hampshire, Tennessee office on a daily basis and sometimes more than once a day. Plaintiffs’ exhibits show that well over a thousand calls were made during the two-year period.

In King’s affidavit testimony in support of his exception, he states that he had no contacts with Louisiana regarding OD and ECB. The disputed stock purchase contracts with OD and ECB were both executed years before the incorporation of ODLa, and the three agreements were never contractually linked together in any manner. King asserts that he did not transact any business on his own behalf in Louisiana. However, we note that he did enter the stock purchase agreement with ODLa, and the plaintiffs’ allegations indicate that he loaned money to ODLa.

UFoIlowing the trial court’s dismissal of the claims of OD and ECB for lack of personal jurisdiction, we granted the corporations’ writ application to review the judgment below.

Discussion

The leading Louisiana Supreme Court case on personal jurisdiction is de Reyes v. Marine Management and Consulting, Ltd., 586 So.2d 103 (La.1991). The de Reyes court extensively discussed the due process constraints on the exercise of personal jurisdiction in a suit not arising out of the defendant’s activities or contacts with the forum. Recognizing the distinction between the so-called “specific” and “general” bases for personal jurisdiction, the court said:

In interpreting the due process clause, the United States Supreme Court has recognized a distinction between two types of personal jurisdiction — “general” and “specific” jurisdiction. Burger King Corporation v. Rudzewicz, 471 U.S. at 473, n. 15, 105 S.Ct. at 2182, n. 15; Helicopteros, 466 U.S. at 414, 104 S.Ct. at 1872. “It has been said that when a State exercises personal jurisdiction over a defendant in a suit arising out of or related to the defendant’s contacts with the forum, the State is exercising ‘specific jurisdiction’ over the defendant.” Id., [at 414 n. 8,104 S.Ct.] at [1872] n. 8. But when a State exercises personal jurisdiction over a defendant in a suit not [1055]*1055arising out of or related to the defendant’s contacts with the forum, the State has been said to be exercising “general jurisdiction” over the defendant. Id., at 414 n. 9,104 S.Ct. at 1872 n. 9.

Id., at p. 105.

The due process protections discussed in de Reyes are expressed in the applicable portions of Louisiana’s Long-Arm Statute, La. R.S. 13:3201, as follows:

A. A court may exercise personal jurisdiction over a nonresident, who acts directly or by an agent, ás to a cause of action arising from any one of the following activities performed by the nonresident:
(1) Transacting any business in this state.

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Bluebook (online)
718 So. 2d 1052, 1998 La. App. LEXIS 2593, 1998 WL 646987, Counsel Stack Legal Research, https://law.counselstack.com/opinion/office-dimensionslouisiana-inc-v-king-lactapp-1998.