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Interstate Industries Inc. v. Barclay Industries Inc.

decided: August 24, 1976.

INTERSTATE INDUSTRIES, INC., PLAINTIFF-APPELLEE,
v.
BARCLAY INDUSTRIES, INC., DEFENDANT-APPELLANT



Appeal from the United States District Court for the Northern District of Indiana, South Bend Division - No. S 75-69 Robert A. Grant, Judge.

Pell, Sprecher and Bauer, Circuit Judges.

Author: Sprecher

SPRECHER, Circuit Judge.

The sole question presented by this interlocutory appeal is whether the district court had personal jurisdiction over the defendant.

I

This diversity action was commenced by Interstate Industries, Inc. (Interstate), plaintiff-appellee, to recover damages from Barclay Industries, Inc. (Barclay), defendant-appellant, for breach of an alleged contract.

The pleadings and affidavits reveal that Interstate is an Illinois corporation whose principal place of business is located in Illinois. Interstate is admitted to do business in Indiana and has a facility in Michigan City, Indiana. Barclay is a Delaware corporation with its principal place of business and manufacturing plant in Lodi, New Jersey. Barclay is not admitted to do business, nor does it have property, offices, warehouses, employees or agents in Indiana. In addition, Barclay does not advertise, maintain a bank account, or telephone in Indiana.

Over a five year period Interstate was involved in numerous business transactions with Barclay in which goods manufactured by Barclay were delivered in Interstate's facility in Michigan City, Indiana. On August 23, 1973, Barclay sent a letter from its offices in Lodi, New Jersey advising Interstate that it would be able to manufacture fiberglass panels in accordance with certain specified standards. The letter included the prices Barclay would charge for manufacturing the panels and expressly stated that the "price quotation is based on orders of 75,000 sq. ft. or more (truckload quantities) freight prepaid. Order less than 75,000 sq. ft. add $.01/sq. ft., F.O.B. Lodi." In November, Interstate mailed two purchase orders to Barclay's New Jersey office with "F.O.B. Delvd." notations in the upper right hand corners. On January 16, 1974, Barclay sent a letter from its New Jersey office informing Interstate that it would be unable to provide the panels requested in the purchase orders.

In April 1975, Interstate filed a complaint against Barclay for breach of contract in the United States District Court for the Northern District of Indiana basing subject matter jurisdiction upon diversity of citizenship. Process was served on Barclay by certified mail at Lodi, New Jersey.

Barclay filed a motion to dismiss the complaint or in the alternative to quash the return of service on the ground that the court lacked personal jurisdiction over Barclay. On August 15, 1975, the motion was denied. Barclay then filed a motion requesting the district court to reconsider its August order or to grant Barclay permission to take an interlocutory appeal pursuant to 28 U.S.C. ยง 1292(b).*fn1 On October 3, 1975, the district court denied Barclay's motion to reconsider the August order but granted it permission to file an interlocutory appeal. Shortly thereafter, by order of this court, Barclay was permitted to appeal the October order of the district court.

II

We shall first review the order and memorandum of August 15, 1975 denying Barclay's motion to dismiss or in the alternative quash service of the summons. The district court utilized Indiana Trial Rule 4.4 to determine whether it had personal jurisdiction over Barclay. Trial Rule 4.4, in pertinent part, provides:

(A) Acts serving as a basis for jurisdiction. Any person or organization that is a nonresident of this state, a resident of this state who has left the state, or a person whose residence is unknown, submits to the jurisdiction of the courts of this state as to any ...


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