                                         No. 03-287

               IN THE SUPREME COURT OF THE STATE OF MONTANA

                                         2004 MT 286


B.T. METAL WORKS and DARYL BOYD, D.B.A.,

              Plaintiff and Appellant,

         v.

UNITED DIE and MANUFACTURING CO.,

              Respondent and Respondent.



APPEAL FROM:         District Court of the Fifteenth Judicial District,
                     In and for the County of Roosevelt, Cause No. DV 2002-46
                     The Honorable Richard A. Simonton, Judge presiding.



COUNSEL OF RECORD:

              For Appellant:

                     Terrance L. Toavs, Attorney at Law, Wolf Point, Montana; John Fredericks
                     III, Attorney at Law, Louisville, Colorado

              For Respondent:

                     Laura Christoffersen, Christoffersen & Knierim, Culbertson, Montana



                                                      Submitted on Briefs: September 18, 2003

                                                                 Decided: October 19, 2004


Filed:



                     __________________________________________
                                       Clerk
Justice Patricia O. Cotter delivered the Opinion of the Court.

¶1     Daryl Boyd, d/b/a B.T. Metalworks (“Boyd”), appeals from an Order of the Montana

Fifteenth Judicial District Court, Roosevelt County, in which the court dismissed his lawsuit

against United Die and Manufacturing Company (“United Die”) for lack of personal

jurisdiction. Boyd, a Montana resident, filed a complaint against United Die, an Ohio

corporation, alleging that United Die intentionally interfered with a business relationship;

breached its fiduciary duty to maintain confidentiality of cost information and drawings; and

misappropriated Boyd’s trade secrets, including cost information, drawings, and product

designs. The District Court concluded that, under Rule 4B, M.R.Civ.P., it did not have

general or specific jurisdiction over United Die. We reverse and remand.

                                          ISSUES

¶2     1. Did the District Court err when it concluded that United Die was not subject to the

general jurisdiction of the Montana courts?

¶3     2. Did the District Court err when it concluded that United Die was not subject to

specific jurisdiction under Montana’s long-arm statute?

¶4     Because we have concluded that Issue Two is dispositive, we do not address Issue

One.

                 FACTUAL AND PROCEDURAL BACKGROUND

¶5     Since 1989, Boyd has entered into various contracts with A&S Tribal Industries

(“A&S”), a corporation chartered under the laws of the Assiniboine and Sioux Tribes of the

Fort Peck Reservation with a principal place of business in Poplar, Montana, on the Fort

                                              2
Peck Reservation. Under the contracts, Boyd supplied A&S with metal latches for medical

chests which A&S manufactures.

¶6     Boyd was located in Tennessee at the time he began his relationship with A&S. He

contracted with United Die to produce the latches in accordance with drawings and other

technical information which Boyd supplied to United Die, and from which United Die tooled

three dies at Boyd’s direction for the manufacture of the latches. Boyd paid United Die

approximately $22,000 for the tooling and dies, which were owned by Boyd but kept at

United Die’s manufacturing facility in Ohio. United Die shipped the latch parts to Boyd,

who assembled the latches before forwarding them to A&S.

¶7     In 1993, Boyd relocated to Helena, Montana. In 1996, Boyd entered into a new

contract with A&S, and Boyd changed his arrangement with United Die. United Die began

to assemble the latches and ship them directly to A&S. Under this arrangement, United Die

sent its invoices to Boyd and the latches to A&S. From 1996 until 2001, United Die fulfilled

twenty similar purchase orders for Boyd.

¶8     Boyd alleges that in 1997, United Die included a copy of its invoice in a shipment to

A&S. The invoice set forth Boyd’s cost information and enabled A&S to calculate Boyd’s

profit margin. Soon after this incident, a United Die representative called Boyd and offered

to buy his latch tooling, and pay Boyd a commission on further latch sales to A&S. Boyd

refused, and his business relationship with United Die continued in the same manner as it

had been conducted since 1996.



                                             3
¶9     In early 2001, Boyd removed his tooling and dies from United Die’s plant and

contracted with another manufacturer for production of the latches. On April 19, 2001,

United Die allegedly contacted A&S and stated its intention to bid on A&S’s next latch

manufacturing contract. A&S requested a formal quote; United Die submitted one that

afternoon. In October 2001, A&S contacted United Die to inquire if its price quote from

April still applied. United Die stated that it would honor the price it quoted in April. A&S

also contacted Boyd and requested a price quote. A&S ultimately awarded the new contract

to United Die because of its lower quoted price.

¶10    Boyd alleges that United Die wrongfully retained copies of the drawings which he had

submitted to them for the construction of his tooling and dies, and that United Die used those

drawings to construct new tooling and dies to manufacture latches for A&S. He filed a

Complaint in the Fifteenth Judicial District Court, Roosevelt County, alleging Intentional

Interference with a Business Relationship, Breach of Fiduciary Duty to Maintain Confidence,

and Misappropriation of Trade Secrets.

¶11    United Die filed a Motion to Dismiss and Brief in Support citing lack of personal and

subject matter jurisdiction. Pursuant to Rule 4B, M.R.Civ.P., it claimed that general

jurisdiction did not exist because United Die did not have continuous and systematic contacts

with Montana; and that specific jurisdiction did not exist because Boyd initiated contact with

United Die at United Die’s place of business in Ohio.

¶12    The District Court concluded that general jurisdiction did not exist over United Die

because the company was not “found within” Montana, and that United Die had insufficient

                                              4
contacts with Montana for the state to exercise specific jurisdiction under its long-arm

provisions. In reaching this conclusion, the District Court found that Boyd’s relationship

with United Die began when Boyd was a Tennessee resident, that Boyd provided United Die

with the drawings necessary for the tooling in Ohio, that the manufacturing process was

begun and completed in Ohio, and that if United Die has wrongfully retained Boyd’s

drawings, it has done so in Ohio.

¶13    The District Court concluded that it had neither general nor specific jurisdiction over

United Die. From this Order, Boyd timely appeals.

                                STANDARD OF REVIEW

¶14    We review a district court’s findings of fact to ascertain whether they are clearly

erroneous. Seal v. Hart, 2002 MT 149, ¶ 13, 310 Mont. 307, ¶ 13, 50 P.3d 522, ¶ 13

(citation omitted). A finding is clearly erroneous if it is not supported by substantial

evidence, if the trial court misapprehended the effect of the evidence, or if our review of the

record convinces us that the district court made a mistake. Seal, ¶ 13 (citation omitted). A

district court’s determination that it lacks jurisdiction is a conclusion of law which we review

to determine whether the court’s interpretation of the law is correct. Seal, ¶ 13 (citation

omitted).

                                       DISCUSSION

¶15    Did the District Court err when it concluded that United Die was not subject to

specific jurisdiction under Montana’s long-arm statute?



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¶16    Boyd argues that United Die is subject to specific jurisdiction under one or more of

the provisions of Montana’s long-arm statute, found at Rule 4B(1), M.R.Civ.P. That Rule

provides:

       All persons found within the state of Montana are subject to the jurisdiction
       of the courts of this state. In addition, any person is subject to the jurisdiction
       of the courts of this state as to any claim for relief arising from the doing
       personally, through an employee, or through an agent, of any of the following
       acts:

       (a) the transaction of any business within this state;

       (b) the commission of any act which results in accrual within this state of a tort
       action; [or]

       ...

       (e) entering into a contract for services to be rendered or for materials to be
       furnished in this state. . . .

For a Montana court to exercise jurisdiction over a nonresident defendant, two questions

must be considered. (1) Does the nonresident defendant come within the provisions of

Montana’s long-arm jurisdiction statute; and (2) would exercise of long-arm jurisdiction over

the nonresident comport with traditional notions of fair play and substantial justice?

Simmons v. State (1983), 206 Mont. 264, 271, 670 P.2d 1372, 1376 (citations omitted). If

we conclude, as a matter of statutory construction, that the nonresident did not engage in any

of the several activities enumerated in our long-arm statute, our analysis ends and we must

decline jurisdiction. However, if the non-resident has done something which potentially

confers jurisdiction, we will advance to the due process component which is ultimately

determinative of the jurisdictional question. Simmons, 206 Mont. at 272, 670 P.2d at 1376.

                                               6
Long-Arm Jurisdiction

¶17    Boyd first claims that United Die “transacted business” within the meaning of Rule

4B(1)(a), M.R.Civ.P., and that the District Court erred when it concluded otherwise. Boyd

claims that United Die’s contacts within Montana were understated in the District Court’s

Order, and emphasizes that United Die sold latches to Boyd in Montana under numerous

purchase orders over a span of eight years and later initiated and entered into a contractual

relationship with A&S, another Montana resident.

¶18    United Die responds that it did not transact sufficient business within Montana to have

availed itself of specific jurisdiction under Rule 4B(1)(a), M.R.Civ.P., and that it is entitled

to sue and be sued in it own jurisdiction. United Die claims that its position is supported by

our case law, and cites Edsall Const. Co., Inc. v. Robinson (1991), 246 Mont. 378, 382-83,

804 P.2d 1039, 1042, for the proposition that “interstate communication” in the form of a

telephone call to submit a bid is not sufficient for jurisdiction to attach. United Die further

argues that its situation is factually similar to that which was before this Court in Cimmaron

Corp. v. Smith, 2003 MT 73, 315 Mont. 1, 67 P.3d 258, in which we found that a respondent

collection agency located in Pennsylvania did not have sufficient contacts with Montana to

be subject to specific jurisdiction.

¶19    In its Order, the District Court found that United Die supplied the latches to A&S for

Boyd’s benefit, but that copies of United Die’s pricing were sent to A&S with a shipment

of latches. It also found that United Die contacted A&S to solicit its business and that A&S

later contacted United Die and Boyd to request bids. The District Court further found that

                                               7
United Die bid on and was ultimately awarded the contract with A&S, and that the

information supplied by Boyd which United Die allegedly misappropriated was supplied

while Boyd was a Tennessee resident.

¶20    Relying on Threlkeld v. Colorado, 2000 MT 369, ¶ 25, 303 Mont. 432, ¶ 25, 16 P.3d

359, ¶ 25, the District Court concluded that “interstate communication” by itself was not

sufficient contact to cause United Die to be subject to jurisdiction in Montana under Rule

4B(1)(a), M.R.Civ.P. The District Court distinguished the cases on which Boyd relied on

the grounds that the cases he cited were product liability or breach of warranty cases.

¶21    Boyd notes in his Brief that the District Court made these distinctions without

providing an explanation as to how those differences would warrant a separate jurisdictional

analysis. In arguing for specific jurisdiction under Rule 4B(1)(a), M.R.Civ.P., Boyd relied

on Nelson v. San Joaquin Helicopters (1987), 228 Mont. 267, 742 P.2d 447, among other

cases. The District Court distinguished Nelson on the grounds that it was a “bad debt” case,

and further noted that, “it involved a close relationship between a California company and

a Montana company.” As Boyd points out, several key factors for finding jurisdiction in

Nelson are also present here. Nelson, 228 Mont at 269, 742 P.2d at 448. Nelson transported

a broken helicopter to a Montana company, which referred him in turn to a California

company to which Nelson ultimately delivered the helicopter for repair. Nelson, 228 Mont.

at 268-69, 742 P.2d at 448. The repair cost was prohibitive, and a somewhat complicated

trade ensued, in which the California company agreed to purchase the helicopter, but instead

of paying Nelson outright, it transferred a promissory note to him payable by the Montana

                                             8
company where he had initially taken the helicopter for repair. Nelson, 228 Mont. at 269,

742 P.2d at 448. The Montana company became insolvent before paying off the note in full,

and Nelson filed suit against the California company which had transferred the note to him.

Nelson, 228 Mont. at 269, 742 P.2d at 448.

¶22    We determined specific jurisdiction existed over the California company, pursuant

to Rule 4B(1)(a), M.R.Civ.P., noting that the defendant’s activities were more extensive than

“a few phone calls back and forth between the parties” and that these activities--which

included two years’ worth of attempts collect a debt against the Montana helicopter repair

company, followed by negotiations with Nelson until Nelson agreed to accept the promissory

note as payment for his helicopter--were sufficient contacts with Montana. Nelson, 228

Mont. at 272, 742 P.2d at 450. In determining jurisdiction, we considered the Montana

relationships the California company had with both Nelson and the Montana helicopter

repair company. Nelson, 228 Mont. at 272, 742 P.2d at 450.

¶23    In Nelson, the fact that the plaintiff initiated a business relationship with the out-of-

state defendant was not ultimately determinative of the jurisdiction question. Here, Boyd’s

relationship with United Die spanned many years and multiple transactions, and United Die

subsequently allegedly interjected itself into an ongoing business relationship between Boyd

and A&S in Montana. Moreover, Boyd’s relationship with United Die is more extensive

than Nelson’s relationship with the California helicopter repair company, which

encompassed only a single transaction. Nelson, 228 Mont. at 272, 742 P.2d at 450. Also,

the California company’s relationship with one Montana resident or another spanned two

                                               9
years, Nelson, 228 Mont. at 272, 742 P.2d at 450, while in United Die’s case, it spanned at

least eight years and a series of negotiated contracts and fulfilled purchase orders.

¶24    However, United Die argues that the situation at hand is less similar to Nelson than

it is to Cimmaron and Edsall, two cases in which we found that Montana did not have

specific jurisdiction over the non-resident defendants. Cimmaron, ¶ 20; Edsall, 246 Mont.

at 383, 804 P.2d at 1043. In Edsall, we held that telephone calls initiated by a Montana

company soliciting a bid from a Utah company to install tile in Utah, were insufficient to

extend specific jurisdiction over the Utah company. We noted that the defendant Utah

company’s only tie to Montana was that it was the home state of the plaintiff; without more,

that did not justify specific jurisdiction in Montana. Edsall, 246 Mont. at 382-83, 804 P.2d

at 1042.

¶25    Edsall is readily distinguishable from the situation at hand. In Edsall, the Utah

company did not deliver goods or services to Montana. Edsall, 246 Mont. at 383, 804 P.2d

at 1042. Its only connection with Montana was a request from a Montana resident that the

Utah company bid on a single job to be performed entirely within Utah. Edsall, 246 Mont.

at 383, 804 P.2d at 1042. In the case at hand, at least twenty requests were made from a

Montana resident for United Die to manufacture latches. United Die initiated contact with

another Montana resident on at least one occasion and submitted a price quote, and later, a

bid to that Montana resident. United Die shipped its product into Montana on approximately

twenty-two separate occasions. To suggest that United Die’s only contact with Montana is



                                             10
that plaintiff Boyd is a Montana resident is inconsistent with the facts of this case. Thus,

Edsall is inapposite.

¶26    In Cimmaron, Budget, a Pennsylvania corporation, entered into a collection agreement

with Cimmaron, a Montana corporation. Cimmaron, ¶ 4. In determining whether specific

jurisdiction over Budget was to be had in Montana, the District Court found that: Budget’s

only contact with Montana was its agreements with Cimmaron; the services Budget was to

perform for Cimmaron were to be performed in Pennsylvania; Cimmaron sent its account

information to Pennsylvania in order for Budget to perform its services there; and, all of the

claims made by Cimmaron in its Complaint pertained to actions Budget took, or failed to

take, in Pennsylvania. Cimmaron, ¶ 15.

¶27    Boyd argues that Cimmaron is distinguishable because it involved a contract for

services to be performed in another state, while the situation at hand involves a contract--or

multiple contracts--for goods to be manufactured for and delivered to a Montana resident.

United Die asserts that it rendered “services” in Ohio. However, United Die overlooks the

fact that in Cimmaron, Budget provided a service--debt collection--which occurred entirely

within Pennsylvania, whereas United Die provided a product--latches--which were

specifically manufactured for and shipped to Montana residents. Thus, we conclude

Cimmaron is less factually similar to this case than is Nelson.

¶28    Finally, relying on Spectrum Pool Products, Inc. v. MW Golden, Inc., 1998 MT 283,

291 Mont. 439, 968 P.2d 728, United Die argues that an out-of-state company must make

the initial contact with a Montana resident to do business for jurisdiction to attach, and

                                             11
transaction of unsolicited business does not give rise to jurisdiction. It claims that since

Boyd initially contacted United Die, Ohio is the proper jurisdiction. While in Spectrum

Pool, it is true that the out-of-state company did make the initial contact, we did not hold that

the initial contact is determinative of jurisdiction. Spectrum Pool, ¶ 21. Furthermore,

whether Ohio may be a proper jurisdiction for this action has no bearing on whether

jurisdiction may also be had in Montana. See Spectrum Pool, ¶ 20 (determining forum to be

proper in Montana does not mean another state would not also be a proper forum).

¶29    In the case before us, we determine that United Die’s contacts with Montana were

more extensive than the contacts held by the defendants in Edsall and Cimmaron, and are

closer qualitatively and quantitatively to the contacts which we found sufficient to grant

jurisdiction in Nelson. Thus, we conclude that United Die had sufficient contacts with

Montana for it to be subject to specific jurisdiction pursuant to Rule 4B(1)(a), M.R.Civ.P.

¶30    Boyd further argues that United Die’s actions resulted in the accrual of a tort action

in Montana, and thus Montana has specific jurisdiction over United Die pursuant to Rule

4B(1)(b), M.R.Civ.P. He points out that his Complaint alleged Intentional Interference with

a Business Relationship, Breach of Fiduciary Duty to Maintain Confidence, and

Misappropriation of Trade Secrets, and that these claims are all torts arising out of United

Die’s ongoing contractual relationships in Montana with Boyd and A&S.

¶31    He also argues that United Die is subject to specific jurisdiction under Rule 4B(1)(e),

M.R.Civ.P., in that it entered, “into a contract for services to be rendered or for materials to

be furnished in this state.” Arguably, both Rule 4B(1)(b) and (e), M.R.Civ.P., would have

                                               12
application here, given the facts before us. However, there is no need for us to reach these

arguments, as the determination of jurisdiction under one of the several grounds for long-arm

jurisdiction set forth in the statute is all that is needed for a determination of specific

jurisdiction. See Rule 4B(1), M.R.Civ.P.

Due Process

¶32    Having determined that the necessary components exist for Montana to exercise

specific jurisdiction over United Die through the long-arm provisions of Rule 4B(1),

M.R.Civ.P., we now must determine whether exercising specific jurisdiction over United Die

comports with traditional notions of fair play and substantial justice as embodied in the due

process clause. Simmons, 206 Mont. at 274, 670 P.2d at 1377 (citations omitted).

¶33    Boyd argues that United Die has engaged in numerous activities within this forum

which have availed it of jurisdiction in Montana, citing United Die’s participation in an

ongoing business relationship with Boyd, its delivery of goods to both Boyd and A&S, its

numerous contracts with Boyd and A&S, and the revenue which United Die generated from

these Montana contracts.

¶34    In Simmons, we explained that the Due Process Clause of the Fourteenth Amendment

to the United States Constitution limits the power of a state court to render a valid personal

judgment against a non-resident defendant, and that a state may exercise personal jurisdiction

over a non-resident only if minimum contacts between the defendant and the forum state

exist. Simmons, 206 Mont. at 272-73, 670 P.2d 1376-77 (citations omitted). We adopted



                                             13
the Ninth Circuit test for determining whether the exercise of jurisdiction comports with due

process:

       (1) The nonresident defendant must do some act or consummate some
       transaction with the forum or perform some act by which he purposefully
       avails himself of the privilege of conducting activities in the forum, thereby
       invoking its laws.

       (2) The claim must be one which arises out of or results from the defendant’s
       forum-related activities.

       (3) Exercise of jurisdiction must be reasonable.

Simmons, 206 Mont. at 276, 670 P.2d at 1378 (citing Data Disc, Inc. v. Systems Tech.

Assoc., Inc. (9th Cir. 1977), 557 F.2d 1280, 1287). We have further held that a plaintiff need

not demonstrate each of the three elements to establish jurisdiction; once the plaintiff

demonstrates that a defendant has purposefully availed itself of the privilege of conducting

activities in Montana, a presumption of reasonableness arises, which a defendant can

overcome only by presenting a compelling case that jurisdiction would be unreasonable.

Simmons Oil Corp. v. Holly Corp. (1990), 244 Mont. 75, 85, 796 P.2d 189, 195 (citation

omitted). Jurisdiction may also be established where a defendant has created sufficient

contacts to allow the state to exercise personal jurisdiction, if such exercise is sufficiently

reasonable. Simmons Oil, 244 Mont. at 86, 796 P.2d at 195.

¶35    A nonresident defendant purposefully avails itself of the benefits and protections of

the laws of the forum state when it takes voluntary action designed to have an effect in the

forum. Conversely, a defendant does not purposefully avail itself of the forum’s laws when

its only contacts with the forum are random, fortuitous, attenuated, or due to the unilateral

                                              14
activity of a third party. Simmons Oil, 244 Mont. at 86, 795 P.2d at 195. The defendant that

invokes the laws of the forum state by purposefully availing itself of the privilege of

conducting activities within the forum should reasonably anticipate being haled into court

in the forum state, and the exercise of jurisdiction over such a defendant is fundamentally

fair. Simmons Oil, 244 Mont. at 86, 795 P.2d at 195.

¶36    In the situation at hand, we cannot agree that United Die’s entry into Montana was

minimal. United Die knowingly shipped its product to Montana on a number of occasions.

It negotiated purchase orders with both Boyd and A&S and it initiated a business relationship

with A&S by calling A&S in Montana and offering A&S a price quote for latches. Given

the many years of its relationship with Boyd after Boyd moved to Montana and the

affirmative steps that United Die took to initiate a business relationship with A&S, we

conclude that United Die purposefully availed itself of the privilege of conducting activities

within this state.

¶37    Taking into account the extent of United Die’s dealings within Montana, the chain of

events which led up to Boyd’s filing this lawsuit, and the test of whether it would be

reasonable for United Die to have to defend itself as a result of this transaction in Montana,

we conclude that exercising specific jurisdiction over United Die through the long-arm

provisions of Rule 4B(1), M.R.Civ.P., would not offend traditional notions of fair play and

substantial justice as embodied in the due process clause. As noted above, a plaintiff need

demonstrate only that a defendant has purposefully availed itself of such privilege for a

presumption of reasonableness to arise. Boyd having met this burden, we need not address

                                             15
the remaining elements in determining whether the exercise of jurisdiction comports with due

process. See Simmons Oil, 244 Mont. at 85, 796 P.2d at 195.




                                            16
                                    CONCLUSION

¶38   For the foregoing reasons, we reverse and remand to the District Court for further

proceedings not inconsistent with this Opinion.



                                                  /S/ PATRICIA O. COTTER




We Concur:

/S/ KARLA M. GRAY
/S/ JAMES C. NELSON
/S/ JOHN WARNER
/S/ JIM RICE




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