Hand v. Wholesale Auto Shop LLC
7:15-cv-01838
N.D. Ala.Jan 5, 2018Background
- Plaintiffs Derek and Ashley Hand (Alabama residents) bought a 2010 Jeep from Wholesale Auto Shop, LLC, a Tennessee corporation, after viewing a listing on Autotrader.
- Mr. Hand initiated contact via Autotrader, spoke with Wholesale Auto three times (Wholesale Auto placed at least two calls), and requested a fax to his Alabama number to obtain financing.
- Wholesale Auto represented the Jeep’s odometer read 66,692 miles; when the Hands sought to register the vehicle in Alabama they learned the true mileage was 253,603.
- Plaintiffs sued in the Northern District of Alabama alleging federal and state consumer/deceptive-practices claims; Wholesale Auto did not appear through counsel and did not timely answer.
- Plaintiffs moved for default judgment; the court raised personal jurisdiction sua sponte, gave the Hands an opportunity to brief the issue, and considered whether specific jurisdiction over Wholesale Auto in Alabama existed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court has specific personal jurisdiction over Wholesale Auto | Hands: defendant purposefully directed fraudulent communications at Alabama (calls, fax, knowledge of residency) that caused harm in Alabama | Wholesale Auto: contacts were initiated by Hands, transaction and injury occurred in Tennessee, national ad not targeting Alabama | No — insufficient minimum contacts; specific jurisdiction lacking |
| Whether defendant’s website/listing on Autotrader establishes jurisdiction | Hands: listing was viewable in Alabama and led to contact | Wholesale Auto: online listing was national and not targeted to Alabama | No — national advertisement alone does not establish contacts |
| Whether phone calls/fax and knowledge of plaintiff’s residency constitute purposeful availment | Hands: calls, fax, and knowledge of residency show purposeful availment | Wholesale Auto: plaintiff initiated contact; calls/fax were part of negotiations and transaction completed in Tennessee | No — contacts were defendant-attenuated or plaintiff-initiated and not enough under Walden/Burger King |
| Whether the Calder/intentional-tort (effects) test supports jurisdiction | Hands: fraudulent misrepresentations aimed at Alabama caused harm there | Wholesale Auto: alleged tortious effects occurred only after Hands brought vehicle into Alabama; conduct primarily directed at Tennessee | No — not expressly aimed at Alabama; effects were not defendant-created in-forum contacts |
Key Cases Cited
- Daimler AG v. Bauman, 134 S. Ct. 746 (limits on general jurisdiction)
- Walden v. Fiore, 134 S. Ct. 1115 (contacts must arise from defendant’s conduct directed at forum)
- Calder v. Jones, 465 U.S. 783 (effects test for intentional torts and jurisdiction)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (purposeful availment and fair warning)
- International Shoe Co. v. Washington, 326 U.S. 310 (minimum contacts standard)
- McGee v. International Life Ins. Co., 355 U.S. 220 (single act can support jurisdiction if substantial connection)
- Licciardello v. Lovelady, 544 F.3d 1280 (application of Calder effects test in the Eleventh Circuit)
- World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286 (fair play and substantial justice factors)
- Meier ex rel. Meier v. Sun Int’l Hotels, Ltd., 288 F.3d 1264 (federal courts follow state long-arm to constitutional limit)
- Sloss Industries Corp. v. Eurisol, 488 F.3d 922 (Alabama long-arm merges with due-process limits)
- Wien Air Alaska, Inc. v. Brandt, 195 F.3d 208 (communications that give rise to intentional torts can constitute purposeful availment)