FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF
MASSACHUSETTS, Hon. George A. O'Toole, Jr., U.S. District
J. Klarfeld, with whom Eric L. Yaffe, Julia C. Colarusso, and
Gray, Plant, Mooty, Mooty & Bennett, P.A. were on brief,
H. Karp, with whom Ari N. Stern and Witmer, Karp, Warner
& Ryan LLP were on brief, for appellee.
Howard, Chief Judge, Selya and Lipez, Circuit Judges.
bi-coastal commercial dispute requires us to test the outer
limits of a court's in personam jurisdiction, consistent
with the constraints of the Due Process Clause. See
U.S. Const. amend. XIV, § 1. The district court
concluded that the defendant lacked sufficient contacts with
the forum state (Massachusetts) to permit the exercise of
jurisdiction and, accordingly, dismissed the action. See
Baskin-Robbins Franchising, LLC v.
Alpenrose Dairy, Inc., No. 14-13771, 2015 WL
5680332, at *2 (D. Mass. Sept. 25, 2015). Concluding, as we
do, that the district court miscalibrated the jurisdictional
scales, we reverse.
Franchising LLC (Baskin-Robbins) is a Delaware special
purpose limited liability company, which maintains its
principal place of business in Canton, Massachusetts. It
franchises independent persons and entities to operate ice
cream stores. Alpenrose Dairy, Inc. (Alpenrose) is a dairy
products manufacturer incorporated in Oregon and
headquartered in Portland.
1965, Baskin-Robbins' predecessor in interest,
Baskin-Robbins Inc. entered into a territorial franchise
agreement (the Agreement) with Alpenrose. At the time,
Baskin-Robbins Inc. had its principal place of business in
Glendale, California. The negotiations surrounding the
formation of the Agreement took place in California. When
consummated, the Agreement gave Alpenrose the right to
operate Baskin-Robbins franchises in Washington and Oregon
for a six-year term, commencing on December 9, 1965. Subject
to other conditions not relevant here, the Agreement gave
Alpenrose an option to renew the franchise for successive
six-year terms as long as it also furnished written notice to
Baskin-Robbins at least one year prior to the expiration of
the current term.
Agreement obligated Alpenrose to comply with
Baskin-Robbins' ever-changing specifications, recipes,
and processes for the manufacture of ice cream products. It
likewise bound Alpenrose to a set of specific procedures for
operating Baskin-Robbins stores. These obligations required
Alpenrose to have a certain amount of ongoing communication
and coordination with Baskin-Robbins.
might be expected, the Agreement controlled the financial
relationship between the parties. It required Alpenrose to
pay royalties to Baskin-Robbins based on monthly sales. The
money stream flowed in both directions: Alpenrose recruited
other franchisees for Baskin-Robbins, and the Agreement
obligated Baskin-Robbins to make monthly remittances to
Alpenrose based on royalties received by Baskin-Robbins from
1973 and 1985, the parties amended the Agreement three times.
These amendments expanded Alpenrose's franchise territory
to include Montana and parts of Idaho. At the time of each
amendment, Baskin-Robbins remained headquartered in
California. All material discussions and negotiations
concerning the amendments took place in Oregon
(Alpenrose's home state).
exercised its renewal options without incident on five
occasions. Throughout this decades-long period,
Baskin-Robbins underwent several ownership changes. Around
1998 - some thirty-three years after Baskin-Robbins and
Alpenrose first executed the Agreement - the current owners
moved Baskin-Robbins' headquarters from California to
(as it had done every six years since 1965), Alpenrose sent
Baskin-Robbins formal notice of its election to renew the
Agreement. Alpenrose directed this notice to
Baskin-Robbins' newly relocated headquarters in
Massachusetts. The Agreement was thus extended for yet
another six-year term.
2006, the ownership of Baskin-Robbins' parent company
again changed hands. Baskin-Robbins' headquarters remained
in Massachusetts and, in November of 2007, Alpenrose renewed
the Agreement for another six-year term (running from
December 9, 2008 to December 8, 2014). This renewal notice -
like the immediately preceding renewal notice - was sent to
Baskin-Robbins in Massachusetts.
the provisions of the Agreement, Alpenrose had until December
8, 2013 to notify Baskin-Robbins of its intent to renew for a
further six-year term. On December 2, 2013, Alpenrose
informed Baskin-Robbins that it did not intend to renew the
Agreement, stating: "[P]lease consider this our one year
notice of intent to not renew. . . . [M]aybe it's time to
take a slightly different direction." Baskin-Robbins did
not formally acknowledge that the Agreement would lapse, but
the parties began negotiating the terms of Alpenrose's
transition out of the franchise arrangement. The negotiations
stalled and, on July 22, 2014, Alpenrose wrote to
Baskin-Robbins, stating that it wished to "revoke"
its decision not to renew. Instead, it requested another
six-year extension of the Agreement, to begin when the
current term expired (that is, on December 8, 2014).
Alpenrose later warned that it would otherwise be entitled to
fair compensation under the Washington Franchise Investment
Protection Act, see Wash. Rev. Code §
responded that Alpenrose had waited too long and was no
longer entitled to renew the Agreement. At the same time, it
rejected Alpenrose's suggestion that any compensation was
due in consequence of the non-renewal of the franchise. Then
- with an impasse in the offing - Baskin-Robbins raced to the
United States District Court for the District of
Massachusetts and sued for a judicial declaration that
"the [Agreement] and all of Alpenrose's rights
associated therewith will expire on December 8, 2014, "
and that "Alpenrose is not entitled to any compensation
in connection with the expiration of the [Agreement]."
The record sheds no light on the current status of the
parties' commercial relationship.
moved to dismiss for lack of personal jurisdiction and
improper venue, see Fed.R.Civ.P. 12(b)(2), (3), or
in the alternative to transfer venue to the United States
District Court for the Western District of Washington,
see 28 U.S.C. § 1404(a). Baskin-Robbins opposed
both motions. After considering the parties' arguments,
the district court dismissed the case for want of in personam
jurisdiction. See Baskin-Robbins Franchising, 2015
WL 5680332, at *2. The court concluded that "nothing in
[the parties'] history . . . suggests that Alpenrose
intended to purposefully avail itself of the privilege of
conducting business within Massachusetts." Id.
timely appeal followed.
as here, a district court dismisses a case for lack of
personal jurisdiction based on the prima facie record, rather
than after an evidentiary hearing or factual findings, our
review is de novo." C.W. Downer & Co.v.Bioriginal Food & Sci. Corp., 771
F.3d 59, 65 (1st Cir. 2014). In conducting this de novo
review, we are not bound by the district court's
reasoning but, rather, may affirm the judgment for any reason
made evident by the ...