Dutch Valley Growers, Inc. v. Rietveld
314 F.R.D. 293
N.D. Ill.2016Background
- Plaintiffs (Growers and Partners-related entities) allege defendants Rietveld and Rosenberg secretly registered plaintiffs’ trademarks, misappropriated customer lists and trade secrets, and solicited Growers’ customers after leaving employment in 2007.
- Defendants and the corporate defendants (Partners and Hybrids) are located in Bourbonnais, Kankakee County, in the Central District of Illinois; most alleged Growers’ shareholders also reside there.
- Complaint alleges some contacts with the Northern District of Illinois (DuPage County): a faxed solicitation to Hacker’s Garden Center in Lombard, counsel retained in Lincolnshire, and an IT firm in Wheaton allegedly hired to wipe Growers’ computers.
- Plaintiffs rely on 28 U.S.C. § 1391(b)(2) (substantial events occurred in the Northern District) and § 1391(b)(1)/§ 1391(d) (defendants reside in Northern District) to justify venue in the Northern District.
- Court finds plaintiffs’ evidence (one disputed fax, attorney retainer, IT invoice, sales numbers) too scant — contacts with the Northern District are minuscule, not substantial; defendants’ primary contacts are in the Central District.
- Court concludes venue is improper in the Northern District and, under 28 U.S.C. § 1406(a), transfers the case to the Central District of Illinois rather than dismissing.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a substantial part of the events occurred in the Northern District under § 1391(b)(2) | Contacts (fax to Lombard customer, 26 of 43 IL customers in Northern District, out‑of‑district counsel, IT work) make venue proper | Major activities and residences are in Central District; Northern contacts are minimal | Held: Northern contacts are minuscule, not substantial; § 1391(b)(2) not satisfied |
| Whether defendants "reside" in Northern District under § 1391(d) via personal jurisdiction standards | Hiring Northern District counsel and limited contacts subject defendants to personal jurisdiction/residence there | Defendants lack continuous/systematic contacts and Northern contacts are random/fortuitous | Held: No specific or general jurisdiction to treat defendants as residing in Northern District; § 1391(d) not met |
| Whether personal jurisdiction exists over defendants in Northern District (constitutional standard) | Limited forum-directed acts suffice (counsel, one fax, some sales) | Minimum-contacts analysis requires more than random/attenuated contacts; foreseeability lacking | Held: Contacts are random/attenuated and de minimis; constitutional due process not satisfied for specific jurisdiction |
| Whether case should be dismissed or transferred under § 1406(a) when venue is wrong | Plaintiffs suggest dismissal may be appropriate | Defendants request dismissal or transfer to Central District where venue is proper | Held: In interests of justice, case transferred to Central District of Illinois under § 1406(a) (dismissal would be time‑consuming and justice‑defeating) |
Key Cases Cited
- International Shoe Co. v. Washington, 326 U.S. 310 (1945) (minimum contacts standard for personal jurisdiction)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985) (foreseeability and fair play in specific jurisdiction analysis)
- Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915 (2011) (general jurisdiction requires continuous and systematic contacts)
- Omni Capital Int'l, Ltd. v. Rudolf Wolff & Co., Ltd., 484 U.S. 97 (1987) (service of process and interplay of federal statute/state long-arm for jurisdiction)
- uBID, Inc. v. GoDaddy Grp., Inc., 623 F.3d 421 (7th Cir.) (extensive forum marketing can establish specific jurisdiction)
- Mobile Anesthesiologists Chicago, LLC v. Anesthesia Assocs. of Houston Metroplex, P.A., 623 F.3d 440 (7th Cir.) (personal jurisdiction framework and comparison of federal/state tests)
- KM Enters., Inc. v. McDonald, 725 F.3d 718 (7th Cir.) (federal test controls in multi-district-state jurisdictional questions)
- Blue Cross & Blue Shield of Mass., Inc. v. BCS Ins. Co., 671 F.3d 635 (7th Cir.) (interpretation of statutory language and resisting loose word use)
- Goldlawr, Inc. v. Heiman, 369 U.S. 463 (1962) (transfer under § 1406(a) favored over dismissal when action could be brought elsewhere)
- Honda Assocs., Inc. v. Nozawa Trading, Inc., 374 F. Supp. 886 (S.D.N.Y.) (mail-only contacts can be minuscule and insufficient for venue)