Marrik Dish Company, LLC v. Wilkinson CGR Cahaba Lakes, LLC, 2:11-cv-04233

Background

SST, an Ohio company, contracted with Cahaba Lakes’ prior owner JRC to install and operate exclusive video/internet services; the exclusivity runs with the land and binds future property owners.
Wilkinson Group, the current Cahaba Lakes owner, challenges the exclusivity and its applicability to Wilkinson.
JRC conveyed Cahaba Lakes to Wilkinson via deed in lieu of foreclosure; Wilkinson believed the covenant was extinguished under Alabama law.
BBCG negotiated with SST on Wilkinson’s behalf, claiming the Agreement did not bind Wilkinson.
SST filed suit on Oct. 27, 2011 seeking (1) breach of covenant/contract, (2) tortious interference with contract, and (3) tortious interference with business relations, and sought a TRO/PI; the court initially granted a TRO.
Defendants moved to dismiss for lack of personal jurisdiction or, alternatively, to transfer the case; the court chose to transfer the case to the Northern District of Alabama under 28 U.S.C. § 1406(a).

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Ohio long-arm statute confers jurisdiction over Wilkinson Group/BBCG	SST asserts transacting business in Ohio via email negotiations suffices	Wilkinson Group/BBCG contend there were no substantial ongoing contacts	No jurisdiction for contract claims; jurisdiction may exist for tort claim
Whether the exercise of jurisdiction satisfies due process for contract claims	Defendants knew SST’s Ohio status; actions caused Ohio harm	No purposeful availment; no ongoing forum-related obligations	Contract claims lack specific jurisdiction; due process not satisfied for contract claims
Whether tort claims support personal jurisdiction	Defendants knew harm would occur in Ohio and interfered with SST’s contracts	Tortious conduct did not arise from forum-based obligations; contacts inadequate	Specific jurisdiction exists for the tort claim under Ohio long-arm statute and due process
Whether transfer under 28 U.S.C. § 1406(a) is proper to New District	Transfer serves justice given forum issues and Alabama law governs covenants	Transfer appropriate to align with forum state and witnesses	Transfer granted to the Northern District of Alabama
Whether pendent jurisdiction would be appropriate			Not adopted; central issue remains which court has jurisdiction over contract claim

Key Cases Cited

Sinochem Int'l Co. v. Malay. Int'l Shipping Co., 549 U.S. 422 (U.S. 2007) (forum non conveniens may bypass jurisdiction questions when warranted)
Medical Mut. of Ohio v. k. Amalia Enterprises Inc., 548 F.3d 383 (6th Cir. 2008) (recognizes threshold grounds disposal and venue concerns)
Nationwide Mut. Ins. Co. v. Tryg Int'l Co., Ltd., 91 F.3d 790 (6th Cir. 1996) (pleading burden for personal jurisdiction; prima facie standard)
CompuServe, Inc. v. Patterson, 89 F.3d 1257 (6th Cir. 1996) (test for Ohio long-arm jurisdiction; case-by-case analysis)
Kentucky Oaks Mall Co. v. Mitchell's Formal Wear, Inc., 53 Ohio St.3d 73 (Ohio 1990) (expansive interpretation of "transact" under Ohio long-arm statute)
PTG Logistics, LLC v. Bickel's Snack Foods, Inc., 196 F. Supp. 2d 593 (S.D. Ohio 2002) (illustrates competing contacts analysis for jurisdiction when negotiations occur outside forum)
Reynolds v. Intl Amateur Athletic Federation, 841 F. Supp. 1444 (S.D. Ohio 1992) (ongoing contacts and contacts with Ohio; relevance to jurisdictional analysis)
Calphalon Corp. v. Rowlette, 228 F.3d 718 (6th Cir. 2000) (continuing obligations required for specific jurisdiction; mere contract not enough)
U.S. v. Botefuhr, 309 F.3d 1263 (10th Cir. 2002) (illustrates pendant jurisdiction concepts across fact patterns)
Van Dusen v. Barrack, 376 U.S. 612 (1964) (choice of law and forum considerations in transfer cases)
Southern Machine Co. v. Mohasco Industries, 401 F.2d 374 (6th Cir. 1968) (multifactor test for reasonableness in whether to exercise jurisdiction)