which was based upon discussions at the August 2 meeting and subsequent telephonic communications, and presented at the October 3 meeting in Indianapolis, differs substantially from the document that was actually signed October 3. There are differences as to total tonnage and specifications for the coal. Provisions in the draft regarding Mary Helen's responsibility if the government were to reject the coal, liquidated damages, plaintiff's right to rescind the contract in the eventuality of government rejection, and economic price adjustment/price escalation do not appear in the final version. Unquestionably, major issues regarding the contract were finally resolved October 3 in Indianapolis and not August 2 in Washington. In fact, the only matters that appear to have been finally resolved at the conclusion of the August 2 meeting were in all likelihood foregone conclusions even before that meeting. These are the substitution of Mitchell as party to the contract, the incorporation of the April 10 agreement except for specified amendments, and the delivery points and quantities specified in the government solicitation. An escrow arrangement, provided for in the April 10 agreement, was fleshed out. Considering also the fact that an agreement, based upon the April 10 agreement, though incomplete, existed and actually was being performed before the August 2 meeting, it cannot be concluded that that meeting was of great significance to this transaction.
No other facts material to the issue of in personam jurisdiction over defendant being disputed, we proceed to apply the law to the facts as outlined above. The "transacting business" clause of the Washington, D.C. long-arm statute permits jurisdiction to the fullest extent permissible under the Due Process Clause. Mouzavires v. Baxter, 434 A.2d 988 (D.C.App.1981) (en banc). The due process analysis requires a determination as to whether there is "a sufficient connection between the defendant and the forum State to make it fair to require defense of the action in the forum." Id., quoting Kulko v. Superior Court, 436 U.S. 84, 91, 98 S. Ct. 1690, 1696, 56 L. Ed. 2d 132 (1978).
Despite the broad reach of the District of Columbia long-arm statute, the case law makes it clear that not every person who does business with a D.C. corporation is to be swept in. The seminal case limiting in personam jurisdiction over foreign corporations in the District is Environmental Research International Inc. v. Lockwood Greene Engineers, Inc., 355 A.2d 808 (D.C.App.1976). The defendant in that case, which had no other significant contact with the District, was solicited at its home office to contract services from plaintiff D.C. corporation, which services were performed in the District of Columbia. Because of the doctrine that entry into the District of Columbia by non-residents for purposes of contacting federal governmental agencies is not a basis for the assertion of personal jurisdiction, the only occasions of defendant's presence in the District in connection with the contract were not supportive of jurisdiction. The court found, relying on Hanson v. Denckla, 357 U.S. 235, 78 S. Ct. 1228, 2 L. Ed. 2d 1283 (1958), that jurisdiction may not rest on plaintiff's activities in the forum, but that defendant must perform some purposeful activity there.
A single act in the jurisdiction by defendant, under some circumstances, may be sufficient to constitute "transacting business", and thereby confer jurisdiction. Mouzavires v. Baxter, supra. Plaintiffs rely upon cases holding that contract negotiations in the forum state, even where defendant has no other contacts, are purposeful activity in the forum sufficient to subject the defendant to its jurisdiction. Doyn Aircraft, Inc. v. Wylie, 443 F.2d 579 (10th Cir. 1971); Data Disc, Inc. v. Systems Technology Associates, supra. Such cases generally involve a course of negotiations, however, one negotiation session in the forum, combined with a continuing series of letters and telephone calls to the forum, were found sufficient for the assertion of jurisdiction in McLaughlin v. Copeland, 435 F. Supp. 513 (D.Md.1977). (The District of Columbia courts take guidance from the neighboring jurisdictions of Maryland and Virginia in the interpretation of their long-arm statute. Environmental Research International, supra.) In McLaughlin, the Court applied a three step test to determine when in personam jurisdiction could be based upon a single act. First, the defendant must purposefully avail himself of the privilege of acting in the forum state. Second, the cause of action must arise from the defendant's activities there. Third, the acts of the defendant must have a substantial enough connection with the forum state to make the exercise of jurisdiction reasonable. The Court found in that case, where defendant attorney entered the jurisdiction for a negotiation session to discuss the settlement of a lawsuit, out of which meeting the claim directly arose, that all three tests were met and jurisdiction would lie on the basis of "transacting business." However, single contacts with the jurisdiction which are insignificant in the scheme of the parties' dealings will not support jurisdiction. Textile Museum v. F. Eberstadt & Co., 440 F. Supp. 30 (D.D.C.1977); Bueno v. La Compania Peruana de Radio-Difusion, 375 A.2d 6 (D.C.App.1977); Concrete Detailing Services Inc. v. Thomsson Steel Co., 411 F. Supp. 1021 (S.D.N.Y.1976).
Returning to the instant case, defendant did not solicit plaintiff in Washington, D.C. Rather, the solicitation went from plaintiff to defendant in Indianapolis. The contract was not to be performed by defendant in the District. The coal was mined, tested, and loaded onto rail cars, at which time plaintiff took title, in Kentucky. It is true that the destination of most of the coal was Washington, D.C. but defendant's role in the transaction had ended before it reached here. The breach of contract, that is supplying coal which failed to meet specifications, if it occurred, occurred in Kentucky. The documents reflecting the contract, the April 10 Agreement, the Escrow Agreement, and the October 3 Agreement, were either signed by each party in its own jurisdiction and exchanged through the mail, or in the case of the October 3 Agreement, the final agreement of the parties, fully executed in Indianapolis. Exchange of letters and telephone communications with a party in the District of Columbia alone is not considered a jurisdictionally significant contract by District of Columbia courts. Environmental Research International v. Lockwood Greene Engineers, Inc., supra; Textile Museum v. F. Eberstadt & Co., supra.
The one meeting which brought defendant to the District of Columbia, the negotiation session of August 2, 1979, because of its minimal significance, does not take this case out of the rationale of Environmental Research International, supra, declining jurisdiction where an out-of-state corporation having no other significant contacts with the District is solicited by a D.C. corporation at its home office, and the contract is performed by defendant outside of the jurisdiction.
The Court finds that defendant's activities in the jurisdiction do not constitute "transacting business" under D.C. Code § 13-423, and that subjecting defendant to the jurisdiction of this court based on its extremely limited contact with the District of Columbia would violate the requirements of due process set forth by the Supreme Court in International Shoe Co. v. Washington, 326 U.S. 310, 66 S. Ct. 154, 90 L. Ed. 95 (1945) and Hanson v. Denckla, supra.
Since the case will be disposed of on the basis of jurisdiction, it is unnecessary to reach the other grounds advanced by plaintiff as requiring dismissal.
Even without jurisdiction over the defendant, the Court may transfer rather than dismiss the case, to avoid the injustice which could result from the dismissal of an action merely because an erroneous decision has been made on a close jurisdictional question. See Goldlawr, Inc. v. Heiman, 369 U.S. 463, 82 S. Ct. 913, 8 L. Ed. 2d 39 (1962), (upholding transfer of venue by a court not having personal jurisdiction over the defendant); Textile Museum v. F. Eberstadt & Co., supra. The most logical place to which to transfer is the Eastern District of Kentucky where there is a pending action between these parties, essentially the counterclaim to this case. Mary Helen Coal Company v. Mitchell Energy Corporation, Civil Action No. 80-112. Defendants' (plaintiffs in this case) motion to dismiss for lack of in personam jurisdiction, or in the alternative, for a change of venue to Washington, D.C. is pending in that case. That motion is being held in abeyance by Judge Unthank until the decision on the motion in this case. Under 28 U.S.C. § 1406(a), the Court may transfer a case to any district or division in which it could have been brought. This claim could have been brought in the Eastern District of Kentucky. Jurisdiction and venue would be proper, as defendant is a Kentucky corporation. 28 U.S.C. § 1391(c). Although the Kentucky Court may find that plaintiffs here may not be sued as defendants in Kentucky, they certainly may bring a case as plaintiffs there. If Mary Helen's Kentucky action is dismissed for lack of jurisdiction over Blackhawk and Mitchell, Mary Helen could assert its claim as a counterclaim to this transferred action. It might be said that it is unfair to force plaintiffs to litigate this claim and a likely counterclaim in Kentucky when they possibly could not have been forced to defend the counterclaim as an original suit there. However, plaintiffs must bring suit in a jurisdiction where defendant is legally amenable to suit. The only apparent jurisdiction where both plaintiffs and defendant would be amenable to suit is Indiana, where Mary Helen has its place of business, and where Mitchell and Blackhawk would be reachable under the Indiana long-arm statute, Indiana Rules of Procedure, Trial Rule 4.4(A)(1), as "doing any business" in the state. As plaintiffs initiated the business relationship which is the subject of this lawsuit by contacting defendant in Indiana, and the October 3 Agreement was fully executed in Indiana, jurisdiction over plaintiffs would not be problematical there, had defendant chosen to bring its claim there instead of Kentucky. However, defendant has in fact brought its claim in Kentucky, and a lawsuit based upon the same transaction is now pending there, favoring the Kentucky court over Indiana. Moreover, it appears that Kentucky may be more convenient for plaintiff than Indiana. There is a contradiction in the record as to the location of the principal place of business of Mitchell Energy. Plaintiffs state in their Opposition to Defendant's Motion to Dismiss (at 12) that Mitchell has its principal place of business in the District of Columbia. However, the attached affidavit of Josephine Mangiapane states that Mitchell's principal place of business is Red Jacket, West Virginia, which, defendant has pointed out, is 25 miles from Belfry, Kentucky. Red Jacket is the home of Iverson Mitchell, Jr. who is the President and Treasurer of Mitchell and was the President and Treasurer of Blackhawk during the period in which the events relevant to this action occurred. As plaintiffs own papers contradict themselves on a point relevant to the convenience of a Kentucky forum, plaintiffs' statement that a Kentucky or Indiana forum would be inconvenient to them cannot be given great weight.
For all of the foregoing reasons, this case will be transferred to the Federal District Court for the Eastern District of Kentucky. An appropriate order accompanies this memorandum opinion.
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