Haldrup USA Corp v. Kincaid Equipment Manufacturing Inc et al
Filing
40
OPINION AND ORDER DENYING AS MOOT 18 MOTION to Dismiss Plaintiff's Amended Complaint or in the Alternative for Venue Transfer by Defendant Kincaid Equipment Manufacturing Inc. Clerk DIRECTED to transfer this matter to the United States District Court for the District of Kansas. Signed by Judge Rudy Lozano on 9/1/16. (cer)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF INDIANA
FORT WAYNE DIVISION
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HALDRUP USA CORP.,
Plaintiff,
vs.
KINCAID EQUIPMENT
MANUFACTURING, INC., and
EMPRISE BANK,
Defendants.
NO. 1:15–CV-00136
OPINION AND ORDER
This matter is before the Court on the Defendant Kincaid
Equipment Manufacturing, Inc.’s Motion to Dismiss Plaintiff’s
Amended Complaint or in the Alternative for Venue Transfer, filed
on July 22, 2015 (DE #18).
For the reasons set forth below, the
Court TRANSFERS this case to the United States District Court for
the District of Kansas, pursuant to 28 U.S.C. § 1406(a), and DENIES
AS MOOT Kincaid’s motion to dismiss (DE #18).
The Clerk is hereby
ORDERED to transfer this matter to the United States District Court
for the District of Kansas.
‐1‐
BACKGROUND
Plaintiff Haldrup USA Corp. (“Haldrup”) filed its Complaint
on April 30, 2015, in Indiana state court.
(DE #4.)
After the
case was removed to federal court, Haldrup amended the Complaint
on July 17, 2015.
(DE #16.)
The Amended Complaint asserts three
breach of contract claims (Counts I-III) and a claim seeking a
preliminary and permanent injunction (Count IV) against Defendant
Kincaid Equipment Manufacturing, Inc. (“Kincaid”).
In response to
the Amended Complaint, Kincaid moves to dismiss based on lack of
personal jurisdiction pursuant to Federal Rule of Civil Procedure
12(b)(2) and improper venue.
In the alternative, Kincaid moves to
transfer the case to the United States District Court for the
District of Kansas pursuant to 28 U.S.C. § 1404(a) or 28 U.S.C. §
1406(a).
issue
(DE #18.)
of
specific
After the parties conducted discovery on the
personal
jurisdiction,
Haldrup
response to Kincaid’s motion on February 26, 2016.
Kincaid filed its reply on March 4, 2016.
filed
its
(DE #37.)
(DE #38.)
DISCUSSION
Facts1
Haldrup is an Indiana corporation with its principal place of
business in Wells County, Indiana.
(DE #16 at ¶1.)
Haldrup is
1
If a defendant moves to dismiss a complaint pursuant to Rule
12(b)(2), the plaintiff bears the burden of demonstrating the
‐2‐
the successor in interest and assignee of certain rights of Haldrup
GmbH, formerly known as Inotec Engineering GmbH (“Inotec”), a
German business with its principal place of operation in Ilshofen,
Germany.
(DE
#16
at
¶5,
¶14;
#19-1
at
¶2.)
Inotec
is
a
manufacturer and seller of agricultural implements used in the
area of field research.
(DE #16 at ¶5.)
Kincaid is a Kansas
corporation with its principal place of business in Haven, Kansas.
(Id. at ¶2.)
In 2012, Inotec sought to partner with a company based in the
United
States
to
introduce,
import,
and
products into the United States market.
distribute
Inotec’s
(DE #16 at ¶6.)
Inotec
and Kincaid discussed a strategic plan to introduce Inotec’s
products
to
the
representatives
United
of
Kincaid
States,
traveled
and
to
in
Ilshofen,
negotiate terms of an agreement with Inotec.
1 at ¶6.)
early
May
2012,
Germany,
to
(Id. at ¶7; DE #19-
On May 3, 2012, Inotec and Kincaid entered into a
Memorandum of Understanding (“MOU”) whereby Kincaid agreed to
introduce Inotec’s products to “the North American market,” and
existence of jurisdiction.
Purdue Research Found. v. Sanofi–
Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir. 2003).
When the
court rules on such a motion based solely on written materials
provided by the parties, the plaintiff “need only make out a prima
facie case of personal jurisdiction. . . . In evaluating whether
the prima facie standard has been satisfied, the plaintiff is
entitled to the resolution in its favor of all disputes concerning
relevant facts presented in the record.” Id. (internal quotations
and citations omitted). Therefore, any disputed facts have been
resolved in Haldrup’s favor.
‐3‐
develop sales of these products.
(DE #16-1 at 1.)
According to
the MOU, Inotec’s products were to be sold under the name Haldrup
A/S (“Haldrup implements”).
(Id.)
The MOU also provided that
Kincaid would buy certain “demo machines” and “act as importer of
said machines.”
(Id.)
Pursuant to the MOU, Inotec sold a C85 plot combine to Kincaid
on May 16, 2012 (“C85 combine”).
(DE #16 at ¶9.)
The order
confirmation for the C85 combine states that the combine was
manufactured in Germany, and delivered to Haven, Kansas.
2.)
(DE #16-
Inotec delivered the C85 combine to Kincaid in Haven, Kansas,
and Kincaid sent the full payment for the C85 combine to Inotec in
Germany.
(DE #19-1 at ¶8-¶9.)
Kincaid modified the C85 combine,
and used it as a demo machine for customers.
(DE #16 at ¶10.)
Kincaid’s modifications and failure to properly maintain and care
for
the
C85
functionality.
combine
allegedly
impacted
the
combine’s
(Id. at ¶11.)
Pursuant to the MOU, Inotec also sold to Kincaid a CTS-95
twin plot combine on July 18, 2012, and a CTS-95 twin plot combine
on February 6, 2013 (“CTS-95 combines”).
(Id. at ¶9.)
The CTS-
95 combines were manufactured in Germany and delivered to Kincaid
in Haven, Kansas.
(DE #16-3; DE #16-4; DE #19-1 at 11, 14.)
Kincaid allegedly modified the CTS-95 combines, but failed to pay
the purchase price for them.
(DE #16 at ¶12.)
Under the terms of
the order confirmations for the CTS-95 combines, Inotec retained
‐4‐
ownership interest in the CTS-95 combines until Kincaid paid the
full purchase price.
(Id. at ¶15; see, e.g., DE #16-3 at 6.)
CTS-95 combines are currently located in Kansas.
The
(DE #19-1 at ¶¶
12, 15.)
Prior to 2013, Kincaid had sold equipment to a company called
Tech
Services,
Inc.
Bluffton, Indiana.
(“Tech
Services”),
(DE #37-3 at ¶3, ¶4.)
which
has
offices
in
In December 2012, Mike
Mossberg (“Mossberg”), President of Tech Services, saw a Haldrup
C85 combine at Kincaid’s trade show booth in Chicago, Illinois.
(Id. at ¶1; DE #37-2 at 3.)
Tech Services was interested in
purchasing a plow/harvester in 2013.
(DE #37-3 at ¶5.)
While it
is unclear who contacted whom after the Chicago trade show, in May
2013, Kincaid brought the C85 combine to Indiana to perform a
demonstration for Tech Services.
(Id. at ¶7.)
Mossberg attests
that the C85 combine did not appear to be “field ready”, and that
it
appeared
to
have
received
no
service
maintenance before the demonstration.
and
only
minimal
(Id. at ¶8, ¶12.)
Tech
Services attempted to operate the C85 combine in two fields in
Indiana and two fields in Illinois, but the combine worked in only
one of the four fields.
(Id. at ¶9-¶11.)
Kincaid brought the C85
combine to Bluffton, Indiana, for inspection and to determine the
cause of its problems.
(Id. at ¶16.)
Bluffton for more than one month.
‐5‐
The C85 combine remained in
(Id. at ¶17.)
In December 2013, Andrew Blubaugh of Kincaid met with Mossberg
at the Chicago trade show and invited him to travel to Europe to
visit the Haldrup facility with Kincaid representatives.
¶19-¶22.)
(Id. at
Mossberg attests that after his visit to the Haldrup
facility, he lacked confidence in Kincaid as a distributor of
Haldrup’s
appear
products
to
because
understand
implements.
or
Kincaid’s
have
the
representatives
ability
to
repair
did
not
Haldrup
(Id. at ¶23-¶24.)
Between 2013 and 2015, Kincaid sold four Haldrup implements
to three entities in Indiana:
(1) a 7-Row Distributor to ABG Ag
Services (“ABG”) in Sheridan, Indiana; (2) a Thresher & Cleaner to
Dow AgroSciences (“Dow”) in West Lafayette, Indiana; and (3) two
implements
(a
6-Row
Planter
and
a
4-Row
Drill)
to
Purdue
University/Elizabeth Rausch Purdue Agronomy Farm (“Purdue”) in
West Lafayette, Indiana.
(DE #37-1 at 2-3.)
Haldrup implements it sold to Purdue.
Kincaid modified the
(Id. at 3.)
On or about March 4, 2015, Inotec sent a demand letter to
Kincaid regarding the matters asserted in the Amended Complaint,
but did not mention its intent to assign its claims.
¶16-¶17.)
(DE #19-1 at
Kincaid retained legal counsel in Kansas to respond to
Inotec’s letter, and on April 3, 2015, Kincaid’s counsel sent a
letter to Inotec in Ilshofen, Germany.
1.)
(Id. at ¶17, ¶18; DE #13-
In that letter, Kincaid refused a settlement offer proposed
by Inotec, asserting that Inotec had breached the MOU, and that
‐6‐
there were “pervasive problems” with Haldrup implements, including
the implements that Kincaid had sold to Purdue and other customers.
(DE #13-1 at 1.)
On April 17, 2015, Inotec assigned to Haldrup its rights
arising from its relationship with Kincaid, including the MOU and
the CTS-95 combines.
(DE #38-1.)
Two weeks later, on April 30,
2015, Haldrup filed suit against Kincaid in Indiana state court.
(DE #4.)2
Kincaid learned of Inotec’s assignment of claims to
Haldrup when it was served with that complaint. (DE #19-1 at ¶20.)
Kincaid had no dealings with Haldrup; all of Kincaid’s dealings
regarding the MOU and combine orders were with Inotec.
¶5.)
(Id. at
None of the dealings between Kincaid and Inotec occurred in
Indiana.
(Id.)
The Amended Complaint alleges that Kincaid failed to pay the
amount due on the CTS-95 combines and failed to abide by the terms
of the MOU.
(DE #16, Counts I-III.)
Haldrup also alleges that
Kincaid’s alterations and modifications to Haldrup implements were
not authorized, that they have resulted in problems for the
ultimate purchasers of those implements, and that they have damaged
Haldrup’s reputation among purchasers of such implements in the
United States market.
(Id. at ¶16-¶18.)
2
Haldrup initially sued Emprise Bank, a Kansas-based bank who acted
as lender to Kincaid in its purchase of the combines from Inotec.
(DE #4; DE #14.) The parties stipulated to dismiss Emprise Bank
from this litigation. (DE #17.)
‐7‐
Personal Jurisdiction
Kincaid moves for dismissal of the Amended Complaint based on
a lack of personal jurisdiction under Federal Rule of Civil
Procedure 12(b)(2).
As the plaintiff, Haldrup bears the burden of
establishing that personal jurisdiction exists, but because the
issue is raised in a motion to dismiss, Haldrup need only make a
prima facie showing of jurisdictional facts.
682 F.3d 665, 672 (7th Cir. 2012).
Felland v. Clifton,
“A district court sitting in
diversity has personal jurisdiction over a nonresident defendant
only
if
a
court
jurisdiction.”
of
the
state
in
which
it
sits
would
have
Purdue Research Found. v. Sanofi–Synthelabo, S.A.,
338 F.3d 773, 779 (7th Cir. 2003).
The inquiry into whether an
Indiana court would have jurisdiction over the defendant has two
steps.
Id. First, the court must decide whether the Indiana long-
arm statute subjects the defendant to in personam jurisdiction.
Id.
If so, then the court must determine whether the exercise of
jurisdiction comports with federal due process requirements.
Id.
Indiana’s long-arm statute, Trial Rule 4.4(A), provides in part
that an Indiana court “may exercise jurisdiction on any basis not
inconsistent with the Constitutions of this state or the United
States.”
Ind. Tr. R. 4.4(A).
Trial Rule 4.4(A) “reduce[s]
analysis of personal jurisdiction to the issue of whether the
exercise of personal jurisdiction is consistent with the Federal
‐8‐
Due Process Clause.”
967 (Ind. 2006).
LinkAmerica Corp. v. Cox, 857 N.E.2d 961,
“Thus, the statutory question merges with the
constitutional one – if [Indiana] constitutionally may exercise
personal jurisdiction over a defendant, its long-arm statute will
enable it to do so.”
Northern Grain Marketing, LLC v. Greving,
743 F.3d 487, 492 (7th Cir. 2014).
For personal jurisdiction to be consistent with due process,
a defendant must have established “certain minimum contacts with
[the forum] such that the maintenance of the suit does not offend
traditional
notions
of
fair
play
and
substantial
justice.”
Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408,
414, 104 S. Ct. 1868, 80 L. Ed. 2d 404 (1984) (internal quotations
and citation omitted).
A court has general personal jurisdiction
over a defendant in any action, even if that action “does not arise
out of or relate to the [defendant’s] activities in the forum
State,”
where
the
defendant
has
sufficient
systematic general contacts with the forum state.
continuous
and
Id. at 414–16.
Haldrup does not argue or allege that the Court has general
jurisdiction over Kincaid.
As such, Haldrup has “waived any
general jurisdiction argument.”
RAR, Inc. v. Turner Diesel, Ltd.,
107 F.3d 1272, 1277 (7th Cir. 1997).
Haldrup argues that the Court has personal jurisdiction under
the doctrine of specific jurisdiction.
A court has specific
jurisdiction over a nonresident defendant when “a controversy is
‐9‐
related to or ‘arises out of’ a defendant’s contacts with the
forum.”
Helicopteros, 466 U.S. at 414 (citation omitted); see
Greving, 743 F.3d at 492 (“To support an exercise of specific
personal jurisdiction, the defendant’s contacts with the forum
state
must
directly
relate
to
the
challenged
conduct
or
transaction.”) (citation and internal quotation marks omitted).
This inquiry “focuses on the relationship among the defendant, the
forum, and the litigation.”
Walden v. Fiore, 134 S. Ct. 1115,
1121, 188 L. Ed. 2d 12 (2014) (citation and internal quotation
marks omitted).
Specific jurisdiction is appropriate where (1)
the defendant “purposefully availed himself of the privilege of
conducting business in the forum state or purposefully directed
his activities at the state;” (2) “the alleged injury [arose] from
the defendant’s forum-related activities;” and (3) the exercise of
jurisdiction comports with “traditional notions of fair play and
substantial
justice.”
Felland,
682
F.3d
at
673
(citations
omitted).
The
“purposeful-availment
requirement
ensures
that
a
defendant’s amenability to jurisdiction is not based on ‘random,
fortuitous,
or
attenuated
contacts,’
but
on
contacts
that
demonstrate a real relationship with the state with respect to the
transaction at issue.” Greving, 743 F.3d at 492–93 (quoting Burger
King Corp. v. Rudzewicz, 471 U.S. 462, 474, 105 S. Ct. 2174, 85 L.
Ed.
2d
528
(1985)).
The
constitutionally-required
‐10‐
minimum
contacts are not shown merely by aggregating all of a defendant’s
contact with the forum state because “individuals and corporations
must
be
able
to
conduct
interstate
business
confident
that
transactions in one context will not come back to haunt them
unexpectedly in another.”
RAR, Inc., 107 F.3d at 1278.
“[T]he
action must directly arise out of the specific contacts between
the defendant and the forum state.” Id. at 1278 (citation omitted;
emphasis in original); see GCIU-Employer Ret. Fund v. Goldfarb
Corp., 565 F.3d 1018, 1024 (7th Cir. 2009) (“the proper focus of
the analysis is on defendant’s conduct and whether plaintiff’s
claim arises out of that conduct”).
Moreover, “the relationship
must arise out of contacts that the ‘defendant himself’ creates
with the forum State.”
Walden, 134 S. Ct. at 1122 (quoting Burger
King, 471 U.S. at 475) (internal quotation marks omitted, emphasis
in original).
“The mere fact that [defendant’s] conduct affected
plaintiffs with connections to the forum State does not suffice to
authorize jurisdiction.”
Advanced Tactical Ordnance Systems, LLC
v. Real Action Paintball, Inc., 751 F.3d 796, 801 (7th Cir. 2014)
(citation and internal quotation marks omitted).
“[T]he
nature
of
the
purposeful-direction/purposeful-
availment inquiry depends in large part on the type of claim at
issue.”
Felland, 682 F.3d at 674.
Here, Haldrup’s Amended
Complaint asserts three breach of contract claims.
Counts I and
II assert that Kincaid breached purchase order confirmations when
‐11‐
it failed to pay for the CTS-95 combines.
Count III asserts that
Kincaid “breached the terms of the [MOU].”
(DE #16 at ¶35.)
“In
a breach of contract case, it is only the dealings between the
parties in regard to the disputed contract that are relevant to
minimum contracts analysis.”
and
quotation
marks
Felland, 682 F.3d at 674 (citation
omitted;
emphasis
in
original).
Courts
consider the parties’ “‘prior negotiations and contemplated future
consequences, along with the terms of the contract and the parties’
actual
course
of
dealing’
in
sufficient minimum contacts.”
determining
whether
there
were
Citadel Grp. Ltd. v. Washington
Reg’l Med. Ctr., 536 F.3d 757, 761 (7th Cir. 2008) (quoting Burger
King, 741 U.S. at 479).
Courts have considered who initiated the
transaction,
contract
was
entered
performed,
and
where
contract
was
negotiated.
where
to
the
be
into,
the
where
the
contract
was
Id. at 762.
Here, Kincaid had no dealings at all with Haldrup regarding
the MOU or the order confirmations for the CTS-95 combines; rather,
Haldrup’s claims are based on Inotec’s assignment of its rights to
Haldrup.
Therefore,
the
Court
will
consider
relationship with Inotec regarding these agreements.
Kincaid’s
See Setra of
N. Am., Inc. v. Schar, No. 1:03CV00711, 2004 WL 1554195, *7
(M.D.N.C. July 7, 2004) (“Defendants’ reasonable expectations
about where they might be expected to defend an action will
normally be determined by their relationship with the assignor.”).
‐12‐
Kincaid, a Kansas citizen, entered into the MOU and the combine
orders with Inotec, a German business located in Germany.
Kincaid
and Inotec negotiated the terms of the MOU during a meeting in
Germany.
Kincaid’s obligations under the MOU were to be performed
in the “North American market,” and, as such, were not limited to
any specific state.
Kincaid ordered the C85 combine and CTS-95
combines from Inotec in Germany.
Inotec manufactured the combines
in Germany and sent them to Kincaid in Kansas.
Kincaid sent its
payment for the C85 combine to Inotec in Germany.
combines are currently located in Kansas.
The CTS-95
None of Kincaid’s
contacts with Inotec involve the State of Indiana.
Because the
disputed agreements have no connections to Indiana, the Court
concludes that it does not have specific jurisdiction over Kincaid
for Haldrup’s breach of contract claims.
See U.S. Bank Nat. Ass’n
v. Bank of America, N.A., No. 1:14–cv–01492, 2015 WL 5971126, at
*10 (S.D. Ind. Oct. 14, 2015).
Haldrup argues that Kincaid purposefully availed itself of
the privilege of conducting business in Indiana when it sold
Haldrup implements to Dow, ABG, and Purdue in Indiana.
Haldrup
also contends that Kincaid’s sales to Purdue are related to this
litigation because Kincaid allegedly refused to pay Inotec for the
CTS-95 combines in part due to problems with the Haldrup implements
that Kincaid sold to Purdue.
Haldrup cites two opinions from the
Southern District of Indiana to support its position.
‐13‐
In O’Neal
v. Bumbo International Trust, 16 F. Supp. 3d 952 (S.D. Ind. 2014),
the plaintiffs sued an infant seat manufacturer to recover damages
arising from injuries their daughter sustained after falling out
of the seat.
The court found personal jurisdiction over the
manufacturer under the “stream of commerce theory.”
Under
this
theory,
a
defendant
may
be
subject
Id. at 958.
to
specific
jurisdiction if it “delivers products into a stream of commerce,
originating
outside
the
forum
state,
with
the
awareness
or
expectation that some of the products will be purchased in the
forum state.”
Id. (citation omitted).
There, the manufacturer’s
distribution network had several locations in Indiana, and thus,
the manufacturer knew that its products would eventually be sold
by retailers in Indiana.
Id. at 959.
The court explained that
where a defendant utilizes a distribution network for its product
sales
“with
the
expectation
that
they
will
be
purchased
by
consumers in [Indiana], it has purposefully availed itself of the
privilege of conducting business in Indiana.”
Id.
In Best Chairs Inc. v. Factory Direct Wholesale, LLC, 121 F.
Supp. 3d 828 (S.D. Ind. 2015), plaintiff Best Chairs, Inc. filed
suit alleging that the defendant had infringed upon its trademarks.
The defendant operated an internet retail store for the promotion
and sale of its allegedly infringing “BestChair” products on
interactive websites like Amazon.com and eBay.com.
Id. at 837.
In determining the existence of personal jurisdiction, the court
‐14‐
relied upon the purposeful-direction requirements for tort claims.
Id. at 836 (requiring intentional and allegedly tortious conduct
aimed that the forum state with the defendant’s knowledge that the
plaintiff would be injured in that state) (citing Tamburo v.
Dworkin, 601 F.3d 693 (7th Cir. 2010)).
The court found personal
jurisdiction existed over the defendant because the defendant held
itself out on the internet as open to do business in every state,
and sold its products to Indiana residents.
Id. at 837.
The Court
finds O’Neal and Best Chairs are distinguishable because Haldrup
does not allege that Kincaid utilized a distribution network for
its sales in Indiana, or that Kincaid is an internet-based retailer
holding itself out as doing business in Indiana.
The Court considers Kincaid’s sales in Indiana to be similar
to those addressed in Advanced Tactical Ordnance Systems, LLC v.
Real Action Paintball, Inc., 751 F.3d 796 (7th Cir. 2014).
In
that case, the plaintiff maintained that the court had personal
jurisdiction over the defendant due to the defendant’s multiple
sales to Indiana residents.
The Seventh Circuit found that “[t]he
only sales that would be relevant are those that were related to
[the defendant’s] allegedly unlawful activity” because “[s]pecific
jurisdiction must rest on the litigation-specific conduct of the
defendant in the proposed forum state.”
Id. at 801.
Because the
plaintiff had not provided evidence of sales related to the
‐15‐
defendant’s alleged wrongful activity, the defendant’s sales to
Indiana residents did not support specific jurisdiction.
See id.
Haldrup does not allege that Kincaid’s sales to ABG and Dow
are related in any way to Haldrup’s breach of contract claims.
Therefore,
Kincaid’s
those
sale
sales
of
complicated issue.
do
not
Haldrup
support
implements
personal
to
Purdue
jurisdiction.
is
a
more
Haldrup proffers evidence that (1) Kincaid
modified the two Haldrup implements that it sold to Purdue, (2)
Purdue complained to Kincaid about problems with those implements,
and (3) Kincaid refused to pay Inotec for the CTS-95 combines, at
least in part, because of Purdue’s problems with those implements.
The Amended Complaint alleges breach of contract claims based on
Kincaid’s alleged failure to pay for the CTS-95 combines.3
Thus,
the problems with the Haldrup implements that Kincaid sold to
Purdue appear relevant to the dispute between Kincaid and Inotec
over the CTS-95 combines.
However, they are insufficient to
support personal jurisdiction.
While Kincaid relied upon the problems with the Haldrup
implements sold to Purdue in response to Inotec’s demand letter,
3
Kincaid urges the Court to disregard “communications about the
Purdue implement defects,” contending that “[t]here is no legal
basis for considering unalleged matters that are outside the scope
of the pleadings in this lawsuit.”
(DE #38 at 10.)
But the
Seventh Circuit has held that “dealings between the parties in
regard to the disputed contract” are relevant to the minimum
contacts analysis, without limiting the Court to considering only
dealings alleged in the complaint. Felland, 682 F.3d at 674.
‐16‐
these
sales
were
too
“random,
fortuitous,
or
attenuated”
to
demonstrate “a real relationship” with the state of Indiana with
respect to Kincaid’s orders for the CTS-95 combines.
F.3d at 493.
Greving, 743
Kincaid’s sales to Purdue initiated from an “annual
field day” that Kincaid hosted in Kelley, Iowa, in June 2012, at
which Kincaid showed a Purdue representative a Haldrup planter.
(DE #38-2 at 3.)
Kincaid sold the Haldrup implements to Purdue in
Indiana in early 2013, two years before Inotec assigned its rights
to Haldrup.
(Id.)
Moreover, Kincaid’s sales of the Haldrup
implements to Purdue were completely separate from its orders to
purchase the CTS-95 combines from Inotec in Germany. Kincaid could
not have reasonably anticipated being haled into court in Indiana
if Inotec claimed that Kincaid had failed to pay for the CTS-95
combines.
Cf. Citadel Grp., 536 F.3d at 764 (finding specific
personal jurisdiction where defendant “should have reasonably
anticipated being haled into court in Illinois if [plaintiff] ever
claimed
that
[defendant]
had
failed
to
incurred” under the parties’ agreement).
pay
for
obligations
To hold otherwise would
allow an interstate business transaction conducted “in one context
. . . to haunt [a defendant] unexpectedly in another.”
RAR, Inc.,
107 F.3d at 1278.
Haldrup
also
relies
on
Kincaid’s
demonstration
of
the
modified C85 combine to Tech Services in Indiana to support
personal jurisdiction.
It is undisputed that Mossberg of Tech
‐17‐
Services saw the C85 combine at Kincaid’s trade show booth in
Illinois in December 2012, and that Tech Services was interested
in purchasing a plow/harvester in 2013.
The record is unclear as
to whether Tech Services or Kincaid initiated communications after
the trade show.
Regardless, Kincaid brought the C85 combine to
Indiana to demonstrate it to Tech Services in 2013.
When Tech
Services attempted to operate the C85 combine in fields in Indiana
and Illinois, it experienced problems with the combine.
The
combine was returned to Bluffton, Indiana, to determine the cause
of the problems, and Kincaid left it there for more than a month.
Haldrup attempts to link Kincaid’s demonstration to Tech Services
to Count IV, which seeks “a preliminary and permanent injunction
precluding Kincaid from demoing, marketing, and/or selling any
agricultural implements manufactured by Inotec and/or Haldrup
which Kincaid has modified or altered without the express approval
of Inotec and Haldrup, including but not limited to [the C85
combine and the CTS-95 combines].”
(DE #16 at ¶9, ¶46.)
Kincaid argues that Haldrup cannot bootstrap its request for
injunctive
relief
jurisdiction.
into
The
an
Court
alternate
basis
agrees.
The
for
personal
“purposeful-
direction/purposeful-availment inquiry” depends on the type of
claim at issue.
Felland, 682 F.3d at 674.
Count IV does not
assert a claim for relief, but rather, is solely a request for a
remedy.
See Onyango v. Downtown Entm’t, LLC, 525 Fed. Appx. 458,
‐18‐
460 (7th Cir. 2013) (“An injunction is a type of remedy, as
distinct
from
an
underlying
citations omitted).
claim
for
relief.”)
(internal
While the Amended Complaint alleges that
Kincaid purchased the C85 combine pursuant to the MOU, modified
the C85 combine, and “used it as a demo machine for customers,”
(DE #16 at ¶9-¶10), it does not allege that Kincaid breached any
agreement with Inotec by modifying the C85 combine or using it as
a demo machine.
For the sake of argument, the Court assumes that
Haldrup’s claim that Kincaid breached the MOU (Count III) forms
the basis of its request for injunctive relief in Count IV.
As explained above, the factors considered in the purposefuldirection/purposeful-availment inquiry do not support personal
jurisdiction over any of Haldrup’s breach of contract claims,
including Count III.
See Citadel Grp., 536 F.3d at 761-62.
Kincaid and Inotec negotiated the terms of the MOU in Germany.
The parties’ actual course of dealing regarding the MOU was between
Kincaid in Kansas and Inotec in Germany.
The record does not
indicate that Kincaid and Inotec contemplated future consequences
in Indiana; rather, the MOU provided that Kincaid would introduce
Haldrup products to “the North American market.”
The MOU’s only
connection to Indiana is based on Inotec’s assignment of its rights
to Haldrup in Indiana, which is not sufficient.
See Purdue
Research Found., 338 F.3d at 780 (“[I]t must be the activity of
‐19‐
the defendant that makes it amenable to jurisdiction, not the
unilateral activity of the plaintiff or some other entity.”).
Kincaid
likens
Haldrup’s
reliance
on
its
request
for
injunctive relief to an argument rejected in Advanced Technical.
There, the district court had found personal jurisdiction based on
the fact that the defendant knew that the plaintiff was an Indiana
company and “could foresee that its [conduct] would harm [the
plaintiff] in Indiana.”
751 F. 3d at 802.
The Seventh Circuit
rejected this argument, and reversed the district court’s finding
of personal jurisdiction.
Id. at 802-04.
Haldrup’s request for
injunctive relief arguably seeks to prevent foreseeable harm to
Haldrup in Indiana.
Kincaid insists that personal jurisdiction is
even less appropriate here than in Advanced Technical because
Kincaid’s demonstration to Tech Services occurred in 2013, two
years before Inotec had assigned its interests to Haldrup.
The
Court
its
agrees
that
Kincaid
could
not
have
foreseen
that
demonstration of the C85 combine to Tech Services would harm
Haldrup in Indiana.
Haldrup has failed to establish a prima facie case that the
exercise of personal jurisdiction by this Court over Kincaid would
be appropriate in this case.
Even resolving all factual disputes
in favor of Haldrup, the record demonstrates that Kincaid could
not have reasonably anticipated being haled into court in Indiana
if Inotec claimed that Kincaid had breached their agreements.
‐20‐
For
the reasons set forth above, the Court determines that it lacks
personal jurisdiction over Kincaid.
Transfer of Venue
As
an
alternative
to
dismissal
for
lack
of
personal
jurisdiction, Kincaid moves for venue transfer to the United States
District Court for the District of Kansas under 28 U.S.C. section
1406(a).
Section 1406(a) provides that a district court may
transfer “a case laying venue in the wrong division or district”
to a district in which it could have been brought “if it be in the
interest of justice.”
28 U.S.C. § 1406(a).
A district court has
the power to transfer a case to an appropriate venue pursuant to
Section 1406(a), even if the court has no personal jurisdiction
over the defendant.
Hapaniewski v. City of Chicago Heights, 883
F.2d 576, 579 (7th Cir. 1989).
“In considering the ‘interest of
justice’ to transfer a case, a district court may consider such
things as the efficient administration of the court system and a
forum closer to the action.”
Philpot v. Oak Ridge Boys Theater,
No. 1:14-cv-01357, 2016 WL 2997570, at *2 (S.D. Ind. May 24, 2016)
(citation omitted); see Garcia v. LQ Properties, Inc., No. 2:15CV-440,
2016
(transferring
WL
3384644,
case
at
pursuant
*4
to
(N.D.
28
Ind.
U.S.C.
June
§
20,
2016)
1406(a)
where
plaintiffs’ claims would likely be time-barred if the case is
‐21‐
dismissed and because “no purpose is served by forcing [plaintiffs]
to file a new complaint and incur a new filing fee”).
Because the Court has determined that it lacks personal
jurisdiction over Kincaid, venue is not proper in this district.4
The Court concludes that the appropriate course of action is not
to dismiss this case for lack of personal jurisdiction, but rather,
to transfer it to a court in which it could properly have been
brought.
The Court considers this case to be more appropriately
filed in the District of Kansas, as it is the domestic location
with the strongest connection to Haldrup’s breach of contract
claims.
located
Kincaid, its counsel, and the CTS-95 combines are all
in
Kansas.
Haldrup
does
not
argue
that
venue
and
jurisdiction would be improper in Kansas; it merely argues that
Kansas is not more convenient than Indiana.
Accordingly, this
case is ORDERED TRANSFERRED to the United States District Court
for the District of Kansas.
4
Venue is proper in
“a judicial district where any defendant
resides, if all defendants reside in the same State in which the
district is located.”
28 U.S.C. § 1391(b)(1).
A corporate
defendant resides “in any judicial district in which such defendant
is subject to the court’s personal jurisdiction with respect to
the civil action in question.” 28 U.S.C. §1391(c)(2). Because
the Court has determined that it lacks personal jurisdiction over
Kincaid, Kincaid does not “reside” in Indiana, and thus, venue is
not proper in this district.
‐22‐
CONCLUSION
For the reasons set forth above, the Court TRANSFERS this
case to the United States District Court for the District of
Kansas, pursuant to 28 U.S.C. § 1406(a), and DENIES AS MOOT
Kincaid’s motion to dismiss (DE #18).
The Clerk is hereby ORDERED
to transfer this matter to the United States District Court for
the District of Kansas.
DATED:
September 1, 2016
/s/ RUDY LOZANO, Judge
United States District Court
‐23‐
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