Burger King v. Rudzewicz
471 U.S. 462, 105 S. Ct. 2174, 85 L. Ed. 2d 528 (1985)
has a long-arm statute that extends
jurisdiction to any person, regardless of location or citizenship, who
breaches a contract that involves acts to be performed in Florida.
a Michigan resident, breached a franchise agreement with Burger King (a
Florida corporation), by failing to make payments in Florida.
and a partner (MacShara) bought a Burger King franchise in Detroit.Business declined and the
partners were unable to pay their royalty fees to Burger King.Burger King terminated the
franchise and ordered the partners to vacate the restaurant.They refused, and continued to
operate under the Burger King name.
King sued for breach of contract (under 28 USC § 1332(a) for diversity jurisdiction) as
well for trademark infringement (under § 1338(a), which gives Federal jurisdiction to
contract had a clause stating that all disputes would be governed by
is called a choice-of-law
argued that since he was a Michigan resident, and because the claims did
not arise within the Southern District of Florida, the District Court
lacked personal jurisdiction over them.
Court found that Florida had personal (in personam) jurisdiction under Florida's long-arm
statute.They also found for Burger King and ordered Rudzewicz
to close the restaurant.Rudzewicz appealed.
Federal Appellate Court reversed the judgment.Buger King appealed.
claimed that he was not financially prepared for the prospect of franchise
litigation in Florida, and could not get a fair trial there.
also claimed that since he did business mostly with the regional office,
he had no reason to anticipate a suit outside of Michigan.
Court found that choice-of-law
provisions do not automatically give Florida the right to extend
jurisdiction outside their legal limits.
US Supreme Court overturned the Appellate Court and found that Florida
does have jurisdiction.
US Supreme Court found that Florida's long-arm statute violated the 14th Amendment.
Shafer v. Heitner (433 U.S. 18 (1977)) the Court
required that individuals have "fair warning that a particular
activity may subject them to the jurisdiction of a foreign
requirement can be satisfied if the individual has purposefully
directed his activities at residents of the forum.
have a manifest interest in
providing its residents a convenient forum for redressing injuries
inflicted by out-of-state actors.
Court found that Rudzewicz chose not to open a local independent
restaurant and instead deliberately reached out beyond Michigan and
negotiated with a Florida corporation and formed a 20-year
relationship.Based on these
facts, it appears that Rudzewicz purposefully directed his activities to Florida.
because Michigan has an interest in this contract, that in no way makes
it unconstitutional for Florida to render jurisdiction.
that this case is a reversal of World-Wide Volkswagen v. Woodson (444 U.S. 286 (1980)).The justice that gave the majority opinion here (Brennan) is the
one that gave the dissent in World-Wide.And White, who gave the dissent here is the one that
gave the majority opinion in World-Wide.