Pohl, Inc. of America v. Webelhuth

2008 UT 89, 201 P.3d 944, 620 Utah Adv. Rep. 3, 2008 Utah LEXIS 202, 2008 WL 5333559
Utah Supreme Court·Decided December 23, 2008·No. 20070622·Published·Cited by 43 cases

Opinions

PARRISH, Justice:

INTRODUCTION

T1 This case asks us to decide whether Utah's long-arm statute extends to defendants who allegedly engaged in a conspiracy to tortiously interfere with the plaintiff's contract and economic opportunities. We address whether Utah's long-arm statute provides for jurisdiction over individuals who never physically entered Utah but who conspired to cause tortious injury in Utah, and directed their actions toward Utah knowing that they would cause tortious injury there. We hold that it does.

BACKGROUND

12 When reviewing a district court's grant of a motion to dismiss, "we accept the factual allegations in the complaint as true and consider them, and all reasonable inferences to be drawn from them, in the light most favorable to the nonmoving party." 1 We recite the facts accordingly.

T3 This case arises from the construction of a performing arts center at the University of Missouri-St. Louis (the "Project"). The general contractor for the Project was KCI Construction Company ("KCI"), a Missouri company. KCI's project manager was Ron Webelhuth. KCI hired TAB. Company, Inc. ("TAB"), a Missouri corporation, as a subcontractor responsible for supplying panels to be installed on the exterior of the building. Because the architect's specifications for the building called for exterior panels manufactured by Pohl, Inc. of America ("Pohl") or their equivalent, TAB subcontracted Pohl, a Utah corporation, to manufacture and supply the panels. TAB also subcontracted a separate company, Industrial Sheet Metal Erectors, Inc. ("ISME"), to install the panels. ISME is a Missouri corporation. Dennis Miller is the president of ISME, and his son, Bret Miller, is the vice-president. Bret acted as project manager on the TAB job.

T4 In May 2005, Pohl filed suit in Utah against Webelhuth, Bret Miller, Dennis Miller, and ISME (collectively, the "Defendants"), alleging intentional interference with contract, intentional interference with prospective economic relations, and civil conspiracy. Pohl alleges that, beginning in February 2008, tensions began to arise between Pohl, ISME, and KCI regarding the production, delivery, and payment schedule for the panels fabricated by Pohl. According to Pohl, these tensions matured into a conspiracy between Bret Miller, ISME, and Webelhuth to interfere with Pohl's contract with TAB. The object of the conspiracy was to replace Pohl, as the panel supplier, with ISME, which could produce and supply a different type of panel more quickly. To this end, Poh! alleges that the defendants convinced the architect and the owner of the Project to change the project specifications from requiring Pohl panels to requiring panels that could be produced by ISME instead. Pohl also alleges that Webelhuth did not accept any other bids or research any other companies before replacing Pohl with ISME as the panel supplier.

[949]*94915 This conspiracy allegedly commenced on February 17, 20083, when Bret Miller and Webelhuth drafted a letter to Pohl demanding that all of the panels be delivered within two days, a demand that all parties knew was impossible. Bret Miller sent the handwritten draft to TAB, asking TAB to finalize the letter and send it to Pohl in Utah, which TAB did. When the panels did not arrive on February 19, 2008, TAB terminated Poh!'s contract and KCI terminated its contract with TAB. After terminating its contract with TAB, KCI entered into a subcontract with ISME to supply substitute panels for the Project.

T6 Pohl filed suit, and the defendants responded with a motion to dismiss for lack of personal jurisdiction, arguing that none of their actions fell within the specifically enumerated acts of Utah's long-arm statute and that there were insufficient minimum contacts between the defendants and the state of Utah. The bulk of their argument focused on the fact that all of the allegedly tortious acts took place in Missouri. The district court agreed and dismissed Pohl's complaint for lack of jurisdiction, concluding that the actions taken by the defendants upon which Pohl based its claims "were performed exclusively in the State of Missouri." Accordingly, the district court found "no nexus between Defendants' contacts with Utah and Plaintiff's claims."

I 7 Pohl appealed, and the court of appeals affirmed the district court's conclusion.2 We granted certiorari to review whether the court of appeals correctly interpreted the Utah long-arm statute, Utah Code section 78B-3-205 (Supp.2008).3 We have jurisdie-

We tion pursuant to Utah Code section 78A-8-102(8)(a) (Supp.2008).

STANDARD OF REVIEW

18 "On certiorari, we review for correctness the decision of the court of appeals, not the decision of the district court." 4 "Whether a court has personal jurisdiction over a defendant under Utah law and the Fourteenth Amendment of the United States Constitution is a question of law, which we review for correctness." 5 In a case such as this one, "[wlhere a pretrial jurisdictional decision has been made on documentary evidence only, an appeal from that decision presents only legal questions that are reviewed for correctness." 6

ANALYSIS

19 The authority of the state to hale a nonresident into a state court hinges on the ability to establish personal jurisdiction.7 There are two categories of personal jurisdiction: specific jurisdiction and general jurisdiction. "General personal jurisdiction permits a court to exercise power over a defendant without regard to the subject of the claim asserted" and is dependent on a showing that the defendant conducted "substantial and continuous local activity in the forum state."8 Pohl does not assert this type of jurisdiction.

% 10 "[Specific personal jurisdiction gives a court power over a defendant only with respect to claims arising out of the particular activities of the defendant in the forum state" and only if the defendant has [950]*950"certain minimum local contacts." 9 Whether we have specific jurisdiction depends on two inquiries. "First, do [the plaintiffs] claims arise from one of the activities listed in the [long-arm] statute," and second, whether the "defendant's contacts with this forum [are] sufficient to satisfy the due process clause of the fourteenth amendment." 10 In determining whether specific jurisdiction exists, our analysis begins with the long-arm statute. "If the relevant state statute does not permit jurisdiction, then the inquiry is ended; if it does, then the question is whether the statute's reach comports with due process."11

1 11 Accordingly, we first analyze whether the court of appeals correctly interpreted Utah's long-arm statute, Utah Code section TSB-3-205. Second, we analyze whether the court of appeals correctly concluded that asserting jurisdiction over the defendants would violate due process.

I.

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Pohl, Inc. of America v. Webelhuth, 2008 UT 89, 201 P.3d 944, 620 Utah Adv. Rep. 3, 2008 Utah LEXIS 202, 2008 WL 5333559 (Utah 2008).

2008 UT 89 (Pohl, Inc. of America v. Webelhuth) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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