C.W. Downer v. Bioriginal Food & Science Corp.
1:13-cv-11788
D. Mass.Mar 3, 2014Background
- Downer sues Bioriginal for breach of contract, implied covenant, unjust enrichment, and Mass. Gen. L. char. 93A over nonpayment of investment banking fees.
- Bioriginal is a Canadian company with no MA office, employees, or registered agent; its principal activities were conducted outside MA.
- The parties entered a Letter Agreement appointing Downer as exclusive financial adviser for a potential sale, with Downer to receive four milestone payments totaling at least $420,000.
- Bioriginal allegedly paid the first three milestone payments but refused the final payment and the $420,000 fee.
- The Letter Agreement required consent to Saskatchewan jurisdiction, while Downer sought MA jurisdiction based on in-state negotiations and performance; the court addresses MA specific jurisdiction.
- Court dismisses for lack of personal jurisdiction; claims may proceed or be addressed elsewhere only if jurisdiction is proper.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court has specific jurisdiction over Bioriginal | Downer asserts MA contacts (in-person meetings, negotiations, MA performance) support jurisdiction | Bioriginal maintains contacts were insufficient and primarily outside MA; no purposeful availing | No specific jurisdiction over Bioriginal |
| Whether Downer’s claims arise from Bioriginal’s MA activities | Claims relate to MA conduct through Downer’s MA work | Bioriginal’s MA activities were not the source of the breach | Not sufficiently related to MA activities |
| Whether Bioriginal purposefully availed itself of MA law | Contacts and negotiations implied purposeful availment | Contacts were passive/insufficient; no ongoing MA engagement | No purposeful availment |
| Whether the Gestalt factors render MA a reasonable forum | MA is convenient for Downer; substantial witnesses in MA | Massachusetts bears little interest; witnesses and effects largely Canada/Saskatchewan | Gestalt factors weigh against MA jurisdiction |
| Whether Saskatchewan forum or law governs disputes | Contract provision; Saskatchewan law applies and forum may be Saskatchewan | MA considerations still limit exercise of jurisdiction | Favorable to Saskatchewan; MA jurisdiction not warranted |
Key Cases Cited
- Phillips Exeter Academy v. Howard Phillips Fund, 196 F.3d 284 (1st Cir. 1999) (relatedness in contract cases depends on contract formation/breach connections to forum)
- Adelson v. Hananel, 652 F.3d 75 (1st Cir. 2011) (Massachusetts long-arm statute aligns with constitutional limits)
- Adelson v. Hananel, 652 F.3d 75 (1st Cir. 2011) (reiterated standard for specific jurisdiction)
- Kowalski v. Doherty, Wallace, Pillsbury & Murphy, Attorneys at Law, 787 F.2d 7 (1st Cir. 1986) (out-of-state attorney’s representation does not by itself establish jurisdiction)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985) (jurisdiction requires substantial connection and foreseeable consequences)
- R. & B. Splicer Sys., Inc. v. Woodland Indus., Inc., 2013 WL 1222410 (D. Mass. 2013) (insufficient in-forum contacts where defendant did not visit MA)
- Telford Aviation, Inc. v. Raycom Nat., Inc., 122 F. Supp. 2d 44 (D. Me. 2000) (out-of-state defendant’s contacts via mail/phone insufficient for jurisdiction when operations occurred elsewhere)
- Swiss Am. Bank, Ltd. v. Ness, Motley, Loadholt, Richardson & Poole, P.A., 274 F.3d 610 (1st Cir. 2001) (purposeful availment requires more than mere inclusion in a contract with a forum resident)
- Sawtelle v. Farrell, 70 F.3d 1381 (1st Cir. 1995) (standard for evaluating jurisdictional facts with pleadings and affidavits)
