Southeast Wireless Network, Inc. v. U.S. Telemetry Corp.

938 So. 2d 127, 2005 La.App. 1 Cir. 1536, 2006 La. App. LEXIS 1366, 2006 WL 1575164
CourtLouisiana Court of Appeal
DecidedJune 9, 2006
DocketNo. 2005-CA-1536
StatusPublished
Cited by1 cases

This text of 938 So. 2d 127 (Southeast Wireless Network, Inc. v. U.S. Telemetry Corp.) 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
Southeast Wireless Network, Inc. v. U.S. Telemetry Corp., 938 So. 2d 127, 2005 La.App. 1 Cir. 1536, 2006 La. App. LEXIS 1366, 2006 WL 1575164 (La. Ct. App. 2006).

Opinion

EDWARD A. DUFRESNE, JR., Chief Judge, Ad Hoc.

2This is an appeal by Southeast Wireless Network, Inc., et al., plaintiffs-appellants, from a judgment sustaining an exception of lack of personal jurisdiction urged by James K. Gable and Charles M. Bruce, defendants-appellees. For the following reasons we vacate that judgment and remand the matter for further proceedings.

The underlying facts are as follows. U.S. Telemetry Corporation (USTC), a defendant, is a Delaware corporation having its principal place of business in Louisiana. This corporation developed a plan whereby it would design equipment to transfer data via the 217-218 MHZ radio spectrum. Plaintiffs, all Louisiana residents and corporations, owned at the time licenses for the radio bands, and they were eventually persuaded by the 3corporation to transfer these licenses in exchange for stock. It is alleged by plaintiffs that at the time of the transfer USTC was in precarious financial condition and had additional market and operational problems, and that these facts were never revealed to them in violation of Louisiana’s Blue Sky law, La. R.S. 51:701 et seq. All of the negotiations and stock transfers were done in Louisiana. Suit [129]*129was brought against USTC and various other corporations and individuals allegedly involved in the above transactions.

James K. Gable and Charles M. Bruce were members of the board of directors of USTC, and are being sued on grounds that they knew or should have known of alleged fraudulent inducements and activities of the corporation directed toward plaintiffs which caused these latter parties to suffer substantial financial losses. Both Gable and Bruce urged exceptions of lack of jurisdiction over their persons on grounds that they had insufficient contacts with Louisiana to subject them to the jurisdiction of its courts. These exceptions were granted and plaintiffs now appeal.

Personal jurisdiction in Louisiana over non-residents has been governed since 1987 by La. R.S. 18:3201 B, the Long-Arm Statute, which pertinently provides that “a court of this state may exercise personal jurisdiction over a non-resident on any basis consistent with the constitution of this state and of the Constitution of the United States.” In Petroleum Helicopters, Inc. v. Avco Corporation, 513 So.2d 1188 (La.1987) the court stated that under this amendment to the long-arm statute jurisdiction is now coextensive with federal constitutional due process requirements. In a subsequent case, de Reyes v. Marine Management and Consulting, Ltd., 586 So.2d 103, at 106-107, the court elaborated on the analysis of long-arm jurisdiction as follows:

Where a forum seeks to assert specific jurisdiction over an out-of-state defendant who has not consented to suit there, the requirement of meaningful contacts is satisfied if the defendant has purposefully 4directed his activities at ' residents of the forum, Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 104 S.Ct. 1473, 79 L.Ed.2d 790 (1984), and the litigation results from alleged injuries that arise out of or relate to those activities. Burger King Corp. v. Rudzewicz, supra, 471 U.S. 462, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985); Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984), supra. By requiring that a defendant must have purposefully availed himself of the privilege of conducting activities within the forum state, thus invoking the benefits and protections of its laws, the requirement ensures that he will not be haled into a jurisdiction solely as a result of a random, fortuitous or attenuated contact, or by the unilateral activity of another party or a third person. Asahi Metal Industry Co. v. Superior Court of California, supra, 480 U.S. 102, 107 S.Ct. 1026, 94 L.Ed.2d 92 (1987); Burger King Corp., 471 U.S. at 475, 105 S.Ct. at 2183; Keeton v. Hustler Magazine, supra; World-Wide Volkswagen Corp. v. Woodson, supra, 444 U.S. 286, 100 S.Ct. 559, 62 L.Edüd 490 (1980). Thus, where the defendant deliberately engaged in significant activities within a state, or has created continuing obligations between himself and residents of the forum, he manifestly has availed himself of the privilege of conducting business there, and because his activities are shielded by the benefits and protections of the forum’s laws it is presumptively not unreasonable to require the defendant to submit to the burdens of litigation in that forum as well. Burnham v. Superior Court of California, 495 U.S. 604, 110 S.Ct. 2105, 2124-25,109 L.Ed.2d 631 (1990) (Brennen, J., concurring); Asahi Metal Industry Co., 480 U.S. at 109, 107 S.Ct. at 1030; Burger King Corp., 471 U.S. at 476, 105 S.Ct. at 2184; World-Wide Volkswagen, 444 U.S. at 297, 100 S.Ct. at 567.
Once it has been decided that a defendant purposefully established such mini[130]*130mum contacts within the forum state, a presumption arises that jurisdiction is reasonable and the burden of proof and persuasion shifts to the defendant opposing jurisdiction to present “a compelling case that the presence of some other considerations would render jurisdiction unreasonable.” Burger King Corp., 471 U.S. at 477, 105 S.Ct. at 2185. See also Haisten v. Grass Valley Medical Reimbursement Fund, Inc.[Ltd.], 784 F.2d 1392 (9th Cir.1986). Most such considerations usually may be accommodated through means short of finding jurisdiction unconstitutional, such as choice of law rules. Burger King Corp., 471 U.S. at 477, 105 S.Ct. at 2185; Burnham v. Superior Court, 110 S.Ct. at 2125. Nevertheless, minimum requirements inherent in the concept of fair play and substantial justice may defeat the inference of reasonableness of jurisdiction even if the defendant has purposefully engaged in forum activities reflected by sufficient minimum contacts. Asahi Metal Industry Co., 480 U.S. at 113, 107 S.Ct. at 1033; Burger King Corp., 471 U.S. at 478, 105 S.Ct. at 2185; World-Wide Volkswagen, supra. Jurisdictional rules may not be employed in such a way as to make litigation so gravely difficult and inconvenient that a party is unfairly placed at a severe disadvantage in comparison to his opponent. Burger King Corp., 471 U.S. at 478, 105 S.Ct. at 2185.
In attempting to overcome the prima facie case that jurisdiction is reasonable, the defendant may present evidence and argument as to certain considerations that the Supreme Court has indicated are relevant in deciding whether maintenance of a suit comports with traditional notions of fail' play and substantial justice. The relationship between the defendant and the forum must be such that it is reasonable to require the defendant to defend the particular suit which 5is brought there. International Shoe Co. v. State,

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938 So. 2d 127, 2005 La.App. 1 Cir. 1536, 2006 La. App. LEXIS 1366, 2006 WL 1575164, Counsel Stack Legal Research, https://law.counselstack.com/opinion/southeast-wireless-network-inc-v-us-telemetry-corp-lactapp-2006.