Brief Fact Summary.
Two men jointly buy a Burger King franchise and fail to make payments. Burger King sues the men in Florida and Defendants object to personal jurisdiction.
Synopsis of Rule of Law.
A court must look at a defendant’s actions directed toward the forum state in determining minimum contacts.
In interpreting the third factor for specific personal jurisdiction, courts look to the burden on the defendant, the forum State's interest in adjudicating the dispute, the plaintiff's interest in obtaining convenient and effective relief, and the interstate judicial system's interest in obtaining the most efficient resolution of controversies.View Full Point of Law
Defendants jointly buy a Burger King franchise in Detroit Michigan. Defendants negotiated the deal with Plaintiff’s Michigan office and Miami headquarters and were eventually awarded the franchise. Defendant MacShara attended management training in Florida, Defendant Rudzewicz purchased equipment for the restaurant from the Burger King office in Florida, and the Defendants were to send franchise and royalty payments to Burger King in Florida. The choice-of-law clause in the franchise agreement also stated that Florida law governed. Defendants fall behind on payments and Plaintiff Burger King sues.
To establish personal jurisdiction must the court look to a defendant’s purposeful actions in determining minimum contacts?
Yes. A court must look at a defendant’s actions directed toward the forum state in determining minimum contacts. Judgement of the Court of Appeals is reversed and the case is remanded for further proceedings consistent with the opinion.
Justice Justice Stevens with Justice White dissenting
Personal jurisdiction rests primarily on the choice-of-law clause which is not enough to establish minimum contacts. It is fundamentally unfair to allow the choice-of-law clause to have that much power because there is significant bargaining disparity between the franchise and the franchisee.