Field Aerospace, Inc. et al v. Boeing Company

Filing 34

ORDER granting 5 Boeing's Motion to Dismiss for Lack of Personal Jurisdiction. This case is TERMINATED in this Court. As the state court unknowingly did not have jurisdiction to issue the TRO (Doc. 12), it is dissolved as a matter of law. Signed by Judge Timothy S. Black on 6/22/17. (gs)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION
FIELD AEROSPACE, INC., et al.,
Plaintiffs,
vs.
THE BOEING COMPANY,
Defendant.

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Case No. 1:17-cv-379
Judge Timothy S. Black

ORDER GRANTING DEFENDANT’S MOTION TO DISMISS
FOR LACK OF PERSONAL JURISDICTION (Doc. 5)
This civil action is before the Court on Defendant The Boeing Company’s
motion to dismiss for lack of personal jurisdiction (Doc. 5) and the parties’ responsive
memoranda (Docs. 16 and 23). 1
I.

FACTS AS ALLEGED BY THE PLAINTIFFS

For purposes of this motion to dismiss, the Court must: (1) view the complaint in
the light most favorable to Plaintiffs; and (2) take all well-pleaded factual allegations as
true. Tackett v. M&G Polymers, 561 F.3d 478, 488 (6th Cir. 2009).
A.

The Field Entities

In April 2012, an Ohio corporation named AVAMCO was formed to acquire two
companies: Field Aviation, Inc. (“FAI,” an Ohio Corporation) and Field Aviation
Company, Inc., (“FACI,” a Canadian entity). 2 (Doc. 16, Ex. 1 at ¶ 3). AVAMCO later

1

Plaintiffs include Field Aerospace, Inc. and Field Aviation Company, Inc. (collectively,
“Field”).

2

FACI is a subsidiary of Field Aerospace, Inc., an Ohio corporation (Doc. 4 at ¶ 2).

changed its name to Field Aerospace, Inc. (Id. at ¶ 4). The Field family of companies
specializes in aircraft modification. (Id. at ¶ 6). Dan Magarian has at all times served as
Chairman of Field Aerospace and its predecessor AVAMCO, based out of Cincinnati,
Ohio. (Id. at ¶ 2).
B.

The relationship between Boeing and the Field Entities

In late spring 2012, Boeing “cold called” FAI’s Ohio office, seeking a strategic
partner for its mid-market intelligence, surveillance, and reconnaissance/maritime
surveillance aircraft program (“MSA program”). (Doc. 16-1 at ¶ 7). Shortly after that
call, Boeing presented a program pitch to Field’s Ohio-based Chairman (Magarian) as
well as to other Field executives. (Doc. 16-1 at ¶ 8). Field and Boeing discussed Field
providing proprietary engineering and modification services for the MSA program,
beginning with one prototype aircraft: the MSA Demonstrator. (Doc. 16-1 at ¶ 12;
Doc. 1-1 at ¶ 8).
During Boeing’s initial presentation, Field informed Boeing of Field’s plans to
build an Aviation Center of Excellence in Ohio. In internal emails immediately after that
pitch, Boeing executives described the possibility of a Field facility in Ohio as “[t]oo
good to be true,” and “in the right location.” (Doc. 16-2, Ex. A).
Magarian sent Boeing a follow-up letter on June 29, 2012 on FAI letterhead,
listing a Cincinnati, Ohio, address, to express Field’s interest in partnering with Boeing.
(Doc. 16-1 at ¶ 10; Ex. A). A week later, Field’s Contract Manager, David MacNeil, sent
a Budgetary Letter to Boeing, providing a rough pricing estimate for the MSA

2

Demonstrator project. MacNeil’s letter, and an attached summary and support letter from
Magarian, were sent on FAI letterhead that listed a Cincinnati, Ohio, address. (Id. at
¶ 11; Exs. B, C). Over the following several months, Magarian, MacNeil, and Brian
Love were the principal negotiators and decision-makers for Field in connection with the
MSA program. (Id. at ¶ 13).
As a result of the negotiations, Boeing knew that Field was seeking to build or
lease a production facility in Ohio in order to perform modification work once the MSA
program entered the production phase. 3 In August 2012, Magarian met with Steve Teske,
a Field Marketing Director in Boeing’s Dayton-area office, at a trade event in the Dayton
area. (Doc. 16-1 at ¶ 21). Magarian reported that meeting to Boeing’s Project Manager
for the MSA project, Doug Ilgenfritz. (Id. at ¶ 22). Ilgenfritz then briefed Teske on
Field’s role in the MSA program and efforts to locate a facility in Ohio so that Teske
would “have more detail and awareness” regarding the project. (Id.; Ex. E). Boeing
offered to make Teske available to assist Field in its efforts to secure an Ohio production
facility. (Id. at ¶ 23).
Throughout the project negotiations, Field sought to secure a long-term role as a
supplier for Boeing and to gain some certainty on the scope of its work. (Doc. 16-1 at
¶ 14). On September 21, 2012, John Mackiewicz, the Boeing supplier manager who
supported the MSA program, initiated a phone call with Magarian to discuss a

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Field claims that it was induced to participate in the MSA Demonstrator project by
Boeing’s representations that if the project was a success, Field could be involved in the
production of as many as 150 MSA aircraft over the next ten years with a sales potential
of as much as $10 billion. (Doc. 16-1 at ¶¶ 9, 19; Doc. 16-2, Ex. A).
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commitment from Boeing to make Field its exclusive supplier for up to 30 MSA aircraft,
as well as a process for how the parties would address changes to the scope of work on
(and therefore the cost of) the MSA Demonstrator. (Id. at ¶ 25; Ex. F). Mackiewicz sent
a summary of that conversation, including the parties’ respective positions on those
terms, to Magarian (who was based in Ohio). (Id.) Magarian sent a response providing a
detailed summary of Field’s negotiating position. (Id.) Among other things, Magarian
recommended that the parties press forward with a term sheet for a future production
contract while they negotiated and executed the MSA Demonstrator Purchase Contract
(“Purchase Contract”). (Id.)
The production contract contemplated that Field would be Boeing’s exclusive
supplier for the first ten MSA aircraft and—provided that Field met certain quality and
production capacity requirements—the next 20 as well. (Doc. 1-1 at ¶¶ 18-20).
Although the production contract was never signed, Field undertook extensive efforts to
locate a site for a production facility in Ohio. (Doc. 16-1 at ¶ 16). Those efforts included
working with Governor Kasich, Senator Portman, and several local government officials;
securing incentives from Jobs Ohio (a non-profit corporation designed to stimulate job
creation in Ohio); and securing substantial incentives from Butler County and the City of
Fairfield to expand the Butler County Airport. (Id. at ¶¶ 17-18). Magarian discussed
many of these efforts at length with Ilgenfritz. (Id. at ¶ 19-20; Ex. D). Magarian advised
Ilgenfritz that Jobs Ohio incentives would be available to fund the Ohio production
facility. (Id. at ¶ 20). Ilgenfritz said that a facility in Ohio would be interesting and
advantageous. (Id. at ¶ 19, Ex. D). Boeing encouraged and promised to support Field’s
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efforts, and, among other things, offered to make Teske—an Ohio based employee—
available to help. (Id. at ¶¶ 19-23).
On October 2, 2012, Magarian sent an email to Mackiewicz on Field Aviation
letterhead, showing Field’s Ohio address, asking about Boeing’s progress on putting a
contract together. Mackiewicz responded that Boeing was updating the statement of
work for the MSA Demonstrator project, and planned to issue a final Request for
Proposal later that week. (Doc. 16-1 at ¶ 26; Ex. G). He added that Magarian “should
not see any surprises based on the level of coordination we have been going through
between the teams.” (Id.) Mackiewicz concluded by promising to keep Magarian posted.
(Id.)
About three weeks later, Magarian sent Ilgenfritz an email from Ohio with an
agenda for their meeting in Seattle later that week. (Doc. 16-1 at ¶ 27; Ex. H). Among
other things, Magarian wanted to discuss “finaliz[ing] open items on the . . .
Demonstrator,” “[m]ov[ing] forward with executing” the parties’ contract, the scope of
work on the Demonstrator, the term sheet for a future production contract, press releases
for the Demonstrator project, and Field’s role in marketing the MSA project. (Doc. 16-1
at ¶ 27; Ex. H). Ilgenfritz confirmed that those were all planned topics of discussion.
(Id.) In November 2012, Boeing invited Magarian and others to come to Seattle to sign
the MSA Demonstrator Purchase Contract. (Id. at ¶ 28; Ex. I).

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C.

The Purchase Contract between Boeing and FACI

On December 4, 2012, Boeing and FACI executed the Purchase Contract. (Doc.
1-1 at ¶ 9; Doc. 9). The Purchase Contract incorporates a “term sheet” for a future
production contract. (Doc. 9 at 68). The term sheet states, in relevant part:
Given the uncertainties associated with the Demonstrator Aircraft effort and
the parties’ shared desire to expedite negotiations associated with the
follow-on production contract, the parties have agreed to proceed with
collaboration on the Demonstrator Aircraft prior to completing negotiations
on a long-term production contract (“Production Contract”) pursuant to
which Boeing intends to purchase from Field Aviation modifications to
new or used Challenger 604/605 aircraft for maritime surveillance missions
(as modified for such missions, the aircraft are referred to as “MSA”). As
soon as practical, the parties agree to negotiate in good faith on the terms of
a Production Contract, which will include the key terms set forth below.
The parties intend to sign the Production Contract at the conclusion of the
Demonstrator Aircraft effort (or such earlier time as mutually agreed by the
parties).
Id.
In July 2013, Magarian and three others from Field participated in an MSA
program review with Boeing. (Doc. 1-1 at ¶ 29). During that review, Magarian
discussed Field’s efforts to open a facility in Ohio for the production phase of the MSA
program. (Id.) Boeing was pleased with that development. (Id.) However, the parties
ultimately never entered into a production contract.
D.

Boeing’s termination of the Purchase Contract

In mid-2016, Boeing stopped soliciting orders for MSA aircraft. (Doc.1-1 at
¶ 28). In or around September 2016, Boeing indicated to Field that Boeing was no longer
actively marketing the MSA program, and that Boeing would decline any opportunity to
sell an MSA. (Id. at ¶ 30). On or about October 11, 2016, Boeing indicated that it
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terminated the MSA program and transferred the MSA Demonstrator to another division
of Boeing for an alternate use, allegedly in breach of the Purchase Contract. (Id. at ¶ 31).
On November 1, 2016, Boeing confirmed that it terminated the Purchase Contract
effective October 25, 2016, and informed Field that Boeing would not sell an MSA to
customers in the future. (Id. at ¶¶ 32-33). Boeing also informed Field that Boeing had
transferred the MSA Demonstrator to “Phantom Works,” a different division of Boeing,
in order to allow Boeing to use the MSA Demonstrator for other projects. (Id. at ¶ 34).
On November 7, 2016, Field submitted a proposed termination settlement of
$7,126,280, representing the value of the MSA Demonstrator ($6,478,600), plus the
value of all Boeing-approved changes ($647,680). (Doc. 1-1 at ¶ 36). Boeing did not
pay the proposed settlement amount. (Id. at ¶¶ 37-38). Field claims Boeing is using the
MSA Demonstrator to explore non-MSA projects. (Id. at ¶ 40). To date, Boeing has not
paid Field for its work on the MSA Demonstrator or for the use of Field’s intellectual
property on the MSA Demonstrator. (Id. at ¶ 41).
E.

Plaintiffs’ Complaint

On June 1, 2017, Plaintiffs filed a Complaint containing four counts, each
premised on the allegation that Boeing has unlawfully retained benefits under the
Purchase Contract without compensating Field. Count One alleges Boeing breached the
terms of the Purchase Contract by (1) transferring the MSA Demonstrator to a different
division in violation of the terms of the Purchase Contract and (2) prematurely
terminating the Purchase Contract and refusing to pay the proposed settlement amount.
(Doc. 1-1 at ¶ 42-51). Count Two alleges that Boeing has been unjustly enriched by
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retaining the MSA Demonstrator, which contains Field’s labor and intellectual property.
(Id. at ¶¶ 52-60). Count Three alleges Boeing has misappropriated Field’s trade secrets
by retaining the MSA Demonstrator. (Id. at ¶¶ 61-70). Count Four alleges Boeing
breached the duty of good faith and fair dealing imposed by the Purchase Contract. (Id.
at ¶¶ 71-75).
The Complaint does not allege that the contemplated production contract was ever
executed, nor does the Complaint allege a breach of any such production contract.
II.

STANDARD OF REVIEW

Before addressing Plaintiffs’ motion for preliminary injunction (Doc. 11), the
Court must consider the issue of personal jurisdiction. See, e.g., Action Freight Servs.,
LLC v. Thorne, No. 07-12553, 2007 WL 1830783, at *1 (E.D. Mich. June 22, 2007)
(citing Kroger Co. v. Malease Foods Corp., 437 F.3d 506, 510 (6th Cir. 2006)).
Plaintiffs bear the burden of establishing personal jurisdiction. Mich. Nat’l Bank v.
Quality Dinette, Inc., 888 F.2d 462, 466 (6th Cir. 1989). In deciding whether personal
jurisdiction exists, a court has discretion to hold a hearing or to rely on the affidavits and
factual allegations in the pleadings. Id.
Generally, where the court relies solely on written submissions and affidavits,
plaintiffs “need only make a prima facie showing of jurisdiction.” Neogen Corp. v. Neo
Gen Screening, Inc., 282 F.3d 883, 887 (6th Cir. 2002). However, when injunctive relief
is sought, a stronger showing must be made. See, e.g., Catalog Mktg. Servs., Ltd. v.
Savitch, No. 88-3538, 1989 U.S. App. LEXIS 22172, at *2 (4th Cir. Apr. 24, 1989) (“The
Second Circuit has held that when a preliminary injunction is requested, the plaintiff must
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demonstrate that there is at least a reasonable probability of ultimate success upon the
question of jurisdiction when the action is tried on the merits.”). If the court rules on
written submissions alone, the plaintiff may not rest on his pleadings to answer the
movant’s affidavits, but must set forth, “by affidavit or otherwise[,] . . . specific facts
showing that the court has jurisdiction.” Serras v. First Tenn. Bank Nat’l Ass’n, 875 F.2d
1212, 1214 (6th Cir. 1989). In ruling on a 12(b)(2) motion, the “court will not consider
facts proffered by the defendant that conflict with those offered by the plaintiff.”
Neogen, 282 F.3d at 887. A court must construe the facts presented in the pleadings and
affidavits in the light most favorable to the nonmoving party. See Serras, 875 F.2d at
1214.
III.

ANALYSIS

When the court’s jurisdiction is founded on diversity of citizenship, the court
can exercise personal jurisdiction over a defendant only if personal jurisdiction is
“(1) authorized by the law of the state in which it sits, and (2) in accordance with the Due
Process Clause of the Fourteenth Amendment.” Tharo Sys., Inc. v. cab Produkttechnik
GmbH & Co. KG, 196 Fed. App’x 366, 369 (6th Cir. 2006) (quoting Neogen, 282 F.3d at
888).
A.

Ohio’s Long-Arm Statute

“Ohio’s long-arm statute grants Ohio courts personal jurisdiction over a nonresident if his conduct falls within the nine bases for jurisdiction listed by the statute,” but
also explicitly states that such jurisdiction extends only to claims “arising from” such
enumerated conduct. Conn v. Zakharov, 667 F.3d 705, 712 (N.D. Ohio 2016); Ohio Rev.
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Code § 2307.382(C). Thus, if a plaintiff does not allege that an out-of-state defendant’s
conduct in Ohio gave rise to the plaintiff’s claims, “[t]his should be the end of our
inquiry.” Conn, 667 F.3d at 713.
Ohio’s long-arm statute provides in relevant part:
(A) A court may exercise personal jurisdiction over a person who acts
directly or by an agent, as to a cause of action arising from the
person’s:
(1) Transacting any business in this state
(2) Contracting to supply services or goods in this state;
(3) Causing tortious injury by an act or omission in this state;
(4) Causing tortious injury in this state by an act or omission outside
this state if he regularly does or solicits business, or engages in any
other persistent course of conduct, or derives substantial revenue
from goods used or consumed or services rendered in this state;
…
(6) Causing tortious injury in this state to any person by an act outside
this state committed with the purpose of injuring persons, when he
might reasonably have expected that some person would be injured
thereby in this state…
(C) When jurisdiction over a person is based solely on this section, only a
cause of action arising from acts enumerated in this section may be
asserted against him.
Ohio Rev. Code § 2307.382(A), (C).
1. Transacting Business
Field argues Boeing “transacted business” in Ohio by contacting, and then
negotiating with, an Ohio resident (Magarian). (Doc. 16 at 7). The Court does not agree
with Field’s analysis.
“Transacting business” is defined as “to carry on business, as well as to have
dealings, and . . . is farther reaching than the term contract.” Evenflo Co., Inc. v.

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Augustine, No. 3:14-cv-00076, 2014 WL 3105016, at *4 (S.D. Ohio July 3, 2014); see
also Brunner v. Hampson, 441 F.3d 457, 464 (6th Cir. 2006) (“[t]he term ‘transacting any
business’ as used in . . . the statute . . . will be given broad interpretation.”). However,
the out-of-state defendant must have “ongoing substantive contacts,” and “the existence
of a contract or simply soliciting business in Ohio is not enough.” Evenflo Co., 2014 WL
3105016 at 10. (emphasis supplied).
Two factors help determine whether an out-of-state defendant “transacted
business” within the meaning of the long-arm statute. Hitachi Med. Sys. Am., Inc. v. St.
Louis Gynecology & Oncology, LLC, No. 5:09-cv-2613, 2011 WL 711568, at *5 (N.D.
Ohio Feb. 22, 2011). The first factor is whether the out-of-state defendant initiated the
dealing. Id. The second factor is “whether the parties conducted their negotiations or
discussions in the forum state, or with terms affecting the forum state.” Id. If the parties
negotiated in Ohio with provisions affecting Ohio, the nonresident transacted business in
Ohio. Id. However:
merely directing communications to an Ohio resident for the purpose of
negotiating an agreement, without more, is insufficient to constitute
“transacting business.” “Rather, there must additionally be some
continuing obligation that connects the non-resident defendant to the state
or some terms of the agreement that affect the state.”
Id. (citations omitted).
Here, while there is evidence that Boeing directed communications to, inter alia,
Magarian in Ohio while negotiating the Purchase Contract, there are no “continuing
obligations” connecting Boeing, or the Purchase Contract, to Ohio. The Purchase
Contract is between Boeing, a Delaware corporation, and FACI, a Canadian company.
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(Doc. 9). FACI’s proposal states that the work to be performed under the Purchase
Contract “shall be designed, installed, and tested by Field Aviation at its facility in
Mississauga, Ontario, Canada…” (Doc. 22-1 at 9). The proposal does not contemplate
work in Ohio or reference Ohio in any way. (Id.) The Purchase Contract that was
ultimately executed reflects the same understanding—that all of the work related to the
MSA Demonstrator would take place in Canada. (Doc. 9 at 4).
Field argues, however, that this case is similar to Kentucky Oaks Mall Co. v.
Mitchell’s Formal Wear, where the Supreme Court of Ohio held that Mitchell’s, a
Georgia corporation, “transacted business” in Ohio by negotiating the lease of a
Kentucky storeroom over the phone with the plaintiff, an Ohio limited partnership, and
by mailing the signed contract to the plaintiff in Ohio. 53 Ohio St. 3d 73, 75-76 (1990).
The Supreme Court reasoned that Mitchell’s created “ongoing duties and obligations for
the life of the contract” by mailing the contract to an Ohio resident in Ohio. Id. at 76.
The Court finds Kentucky Oaks distinguishable. Here, Boeing did not create
“ongoing duties and obligations” in the state of Ohio. The only connection between
Boeing, the Purchase Contract, and the State of Ohio is the fact that Magarian resided
there and participated in contract negotiations. But that fact is insufficient to constitute
“transacting business” in the absence of any other continuing obligation to this state.
Hitachi, 2011 WL 711568, at * 5.
Field spends much of its effort arguing that Boeing was attracted to working with
Field because of its Ohio location, and that Boeing intended for performance under a
future production contract to occur in Ohio. (See Doc. 16 at 13-14; Doc. 25 at 5-9). That
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argument fails for two reasons. First, the parties never executed the production contract.
Second, even assuming that Boeing ‘transacted business’ in Ohio - by contemplating that
performance under a hypothetical future production contract would occur in Ohio -,
Ohio law would still not permit personal jurisdiction because this case - which is
premised exclusively on the performance and termination of the Purchase Contract does not arise from that business. See Ohio Rev. Code § 2307.382(C).
2. Torious injury and regularly conducting business
Section (A)(4) of Ohio’s long arm statute requires: (1) a tortious injury in Ohio;
and (2) that the defendant conducted a regular course of business in Ohio or has collected
substantial revenue from activities in Ohio. 4 Int’l Paper Co. v. Goldschmidt, 872 F.
Supp. 2d 624, 629 (S.D. Ohio 2012). With respect to a tortious injury, Field argues that
Boeing misappropriated its intellectual property and trade secrets by permitting one of
Field’s competitors to inspect and remove Field’s modifications from the MSA
Demonstrator. (Doc. 16 at 10-11).
Field’s allegation is that Boeing misappropriated FACI’s trade secrets, 5 and that

4

Boeing has four offices in Ohio which conduct business for the Department of Defense,
NASA, and other customers. (Doc. 6-1 at ¶ 18). Boeing has more than 500 employees
in Ohio. (Id. at ¶ 19). In fact, on its website, Boeing notes that it does business with
nearly 400 suppliers and vendors and $10.5 billion in supplier/ vendor purchases in Ohio.

5

The Complaint alleges Boeing is in possession of “Field’s” trade secrets. (Doc. 1-1 at
65). But Field has acknowledged the only trade secrets at issue involve work FACI
performed on the MSA Demonstrator under the Purchase Contract. (Doc. 1-1 at ¶ 64
(“The MSA Demonstrator contains Field’s trade secrets, including but not limited to
technical information, engineering processes and designs, and physical modifications to
the MSA Demonstrator airframe.”); Doc. 16 at 9 (“Boeing acquired access to Field’s
proprietary information solely through the Purchase Contract.”)).
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this caused an indirect injury in Ohio because FACI’s parent company—plaintiff Field
Aerospace—is an Ohio company. This argument ignores the principle of corporate
separateness, under which “[p]arent and subsidiary corporations are distinct legal
entities.” Hoover Universal, Inc. v. Limbach, 575 N.E.2d 811, 814 (Ohio 1991). Even if
Field Aerospace was financially impacted in Ohio, only FACI—the entity that claims the
trade secrets—could have suffered the alleged tortious injury. Bachtel v. Barker, No.
1:15cv434, 2016 WL 339931 at *5 (S.D. Ohio Jan. 28, 2016) (recognizing that a tortious
injury requires a tort claim).
For these several reasons, this Court lacks personal jurisdiction under Ohio’s longarm statute.
B.

Constitutional Due Process

The Sixth Circuit has “recognized that Ohio's long-arm statute is not coterminous
with federal constitutional limits,” and has “consistently focused on whether there are
sufficient minimum contacts between the nonresident defendant and the forum state so as
not to offend ‘traditional notions of fair play and substantial justice’” when analyzing the
propriety of personal jurisdiction under Ohio’s long-arm statute. Bird v. Parsons, 289
F.3d 865, 871 (6th Cir. 2002) (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316
(1945)).
The Sixth Circuit employs a three-prong test to determine whether specific
jurisdiction can be exercised consistent with the Due Process Clause of the Fourteenth
Amendment. First, “the defendant must purposefully avail himself of the privilege of
acting in the forum state or causing a consequence in the forum state.” S. Mach. Co. v.
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Mohasco Indus., Inc., 401 F.2d 374, 381 (6th Cir. 1968). The purposeful availment
requirement ensures that a defendant will not be haled into a jurisdiction solely as a result
of random, fortuitous, or attenuated contacts. Lak v. Deer Creek Enterp., 885 F.2d 1293,
1300 (6th Cir. 1989) (citations omitted).
“Second, the cause of action must arise from the defendant's activities there.”
Mohasco, 401 F.2d at 381. Finally, “the acts of the defendant or consequences caused by
the defendant must have a substantial enough connection to the forum to make the
exercise of jurisdiction over the defendant reasonable.” Id.
Field asserts two arguments as to why personal jurisdiction over Boeing is
constitutionally permissible. First, Field argues Boeing negotiated with Magarian in
Ohio to secure the Purchase Contract. (Doc. 16 at 12).
The Court does not agree with Field’s analysis. Typically, merely communicating
and negotiating with a party in the forum state does not create the type of meaningful
contact which supports personal jurisdiction. See Calphalon v. Rowlette, 228 F.3d 718,
720 (6th Cir. 2000) (finding a non-resident defendant did not purposely avail himself to
Ohio by corresponding with, and visiting, the plaintiff in Ohio in the absence of evidence
defendant sought to create continuous and substantial consequences in Ohio); see also
Reynolds v. Int’l Amateur Athletic Fed’n, 23 F.3d 1110, 1119 (6th Cir. 1994) (stating the
use of telephone and mail generally “cannot alone provide the minimum contacts
required by due process.”) (citation omitted).
As explained supra, the Purchase Contract is a contract between Boeing, a
Delaware corporation, and FACI, a Canadian company. (Doc. 9). The work under the
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Purchase Contract is to be performed exclusively in Canada. (Doc. 9 at 4). The Purchase
Contract has virtually no connection to the state of Ohio other than the fact that one of the
parties involved in its negotiation, Magarian, was located here. This is precisely the kind
of random and fortuitous contact that the purposeful availment requirement is designed to
prevent from causing jurisdiction. See Calphalon, 228 F.3d at 723. The Court does not
believe Boeing intended to invoke the benefits and protections of Ohio by negotiating
with Magarian (among others) regarding a contract between two out-of-state companies
that was to be performed in Canada.
Second, Field asserts personal jurisdiction because Boeing negotiated with
Magarian in Ohio regarding a potential production contract of up to 30 additional MSAs
(a contract that was never executed because Boeing elected to terminate the parties’
relationship) and supported Field’s desire to build an Aerospace Excellence Center in
Ohio. (Doc. 16 at 12-13).
This argument fails for two reasons. Initially, personal jurisdiction cannot be
based on the intent to make contact with the forum sometime in the future; the court must
evaluate the contacts that the defendant has already made. See Zellerino v. Roosen, 118
F. Supp. 946, 953 (E.D. Mich. 2015). Field’s argument that the production contract
(which was never executed) might have been performed in Ohio cannot support a finding
of personal jurisdiction. Id. Even if it did, this argument would not pass the second
prong of the minimum contacts analysis, because the contemplated production contract is
not related to the claims of the Complaint, all of which are premised on the performance
and termination of the Purchase Contract.
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Finally, and in any event, the Court does not believe that personal jurisdiction over
Boeing in this case would be reasonable. In determining whether personal jurisdiction is
“reasonable,” the Court must balance three factors: “the burden on the defendant, the
interests of the forum [s]tate, and the plaintiff’s interest in obtaining relief.” Fortis
Corporate Ins. V. Viken Ship Mgmt., 450 F.3d 214 at 223 (6th Cir. 2006).
Here, Field argues that Ohio has an interest “in securing the rights of corporations
headquartered here.” (Doc. 16 at 15).
This argument is not well-taken. The Purchase Contract that is the subject of this
Complaint is between a Canadian company and a Delaware corporation. The only ties
Ohio has to this case are (1) Magarian, an Ohio resident, was involved to some extent in
negotiating the Purchase Contract, and (2) the parties had contemplated that if their
relationship was successful—and it was not—they would enter into a production contract
at some point in the future that might have been performed in this state. While it is
unclear what burden litigating here would impose on Boeing, the Court notes that
Ohio has virtually no interest in deciding a dispute between two non-resident companies
regarding a contract that was to be performed in Canada.
IV.

CONCLUSION

For these reasons, Boeing’s motion to dismiss for lack of personal jurisdiction
(Doc. 5) is GRANTED. The Clerk shall enter judgment accordingly, whereupon this
case is TERMINATED in this Court. As the state court unknowingly did not have
jurisdiction to issue the TRO (Doc. 12), it is dissolved as a matter of law.

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IT IS SO ORDERED.

6/22/17
Date: ________

______________________
Timothy S. Black
United States District Judge

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