WINEBOW, INC. v. RHODE ISLAND DISTRIBUTING CO., LLC
2:17-cv-04833
D.N.J.Apr 3, 2018Background
- Winebow, a Delaware corporation with its principal place of business in New Jersey, sold wine and used a verbal distributorship with RIDC, a Rhode Island LLC, for Rhode Island distribution from 2008–2017.
- RIDC solicited the Slocum assets (including Winebow distribution rights) and sent Winebow a letter with trade references and a credit application to Winebow’s New Jersey office during contract formation.
- Over the course of the relationship RIDC sent ~477 purchase orders to Winebow in New Jersey (≈$4.9M sales) and arranged pickups from Winebow’s Pine Brook, NJ warehouse totaling ≈$2.2M (≈212 carrier trips).
- Winebow terminated the distributorship in 2017 and sought declaratory relief in the District of New Jersey that it could do so and that its new Rhode Island affiliate could distribute. RIDC threatened suit under the Rhode Island Dealership Act and sued in Rhode Island state court.
- RIDC moved in the New Jersey federal court to dismiss for lack of personal jurisdiction and improper venue, or alternatively to transfer under 28 U.S.C. § 1404(a). The court denied the motion.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Personal jurisdiction (general v. specific) | Winebow: RIDC purposefully availed itself of NJ through formation contacts, sales paperwork, invoices, and pickups from NJ, supporting specific jurisdiction. | RIDC: No NJ presence, no continuous/systematic contacts for general jurisdiction; contacts were random/fortuitous and insufficient for specific jurisdiction. | Court: No general jurisdiction; specific jurisdiction exists because RIDC purposefully directed activities at NJ (formation documents sent to NJ, hundreds of orders, pickups, invoices) and assertion is consistent with fair play and substantial justice. |
| Venue under 28 U.S.C. § 1391(b)(2) | Winebow: Venue is proper because the termination letter was drafted/sent from NJ and material events occurred in NJ. | RIDC: Most conduct occurred outside NJ so venue is improper. | Court: Venue is proper; substantial part of events (contract formation, orders, shipments, pickups, invoicing) occurred in NJ. |
| Transfer under 28 U.S.C. § 1404(a) | Winebow: NJ is convenient and its forum choice should be afforded deference given events and plaintiffs interests. | RIDC: Case should be in Rhode Island (anticipatory declaratory relief argument; statutory interpretation of RI law). | Court: Denied transfer—defendant failed to meet burden; plaintiff’s choice and NJ contacts weigh against transfer; federal court will apply Rhode Island law if needed. |
| Interpretation of Rhode Island Dealership Act issue (choice of forum relevance) | Winebow: Filing in NJ was reasonable given prior licensing efforts and threats; federal court can interpret RI law. | RIDC: RI courts better positioned to interpret the Dealership Act; plaintiff anticipatorily filed in NJ to avoid coercive litigation. | Court: Not persuasive—federal courts in either forum will interpret RI law; no compelling reason to transfer. |
Key Cases Cited
- Daimler AG v. Bauman, 134 S. Ct. 746 (general jurisdiction principle: corporation is "at home" in place of incorporation or principal place of business)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (minimum contacts and purposeful availment analysis)
- Int'l Shoe Co. v. Washington, 326 U.S. 310 (foundation of due process/contacts requirement for jurisdiction)
- Vetrotex Certainteed Corp. v. Consol. Fiber Glass Prod. Co., 75 F.3d 147 (passive buyer analysis and limits on purposeful availment in contract contexts)
- Jumara v. State Farm Ins. Co., 55 F.3d 873 (factors for transfer under § 1404(a))