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Ruprecht Company v. Sysco Food Services of Seattle

November 30, 1999

RUPRECHT COMPANY, AN ILLINOIS CORPORATION, PLAINTIFF-APPELLEE,
v.
SYSCO FOOD SERVICES OF SEATTLE, INC., DEFENDANT-APPELLANT (BUDRECK TRUCK LINES, DEFENDANT).



The opinion of the court was delivered by: Justice McNULTY

Appeal from the Circuit Court of Cook County

Honorable Wayne D. Rhine, Judge Presiding

Sysco Food Services of Seattle, Inc. (Sysco), a Delaware corporation, filed a petition for leave to appeal from an order of the circuit court denying Sysco's motion to quash service of process upon it for lack of personal jurisdiction. We find that the circuit court should have held an evidentiary hearing to determine the nature of the transaction between the parties in order to decide whether the court could exercise jurisdiction over Sysco. Accordingly, we reverse and remand for further proceedings.

Ruprecht Company (Ruprecht), an Illinois corporation, engaged in the meat wholesale business, filed a complaint for breach of contract against Sysco, a marketer and distributor of food-service products, and Budreck Truck Lines, Inc. (Budreck). In count I of the complaint, Ruprecht alleged that it furnished cartons of fresh meat to Sysco as ordered and that Sysco refused to pay the invoices for the meat. In count II of the complaint, Ruprecht alleged that it entrusted the cartons of meat to Budreck for shipment to Sysco and that Budreck failed to deliver the meat in good condition. Ruprecht sought to recover $30,000, the value of the cartons of meat, from Sysco and Budreck.

Sysco filed a special and limited appearance and a motion to quash service of process upon it for lack of personal jurisdiction. Sysco attached to its motion the affidavit of David Valentine, Sysco's vice-president of finance, wherein he stated that Sysco did not: (1) have any agents, employees, sales representatives or officers in Illinois; (2) hold any licenses, certificates or permits to conduct any business or other transactions in Illinois; (3) use or possess any real estate in Illinois; (4) own or possess a general place of business, a satellite office or any other facility, building or other improvement to real property in Illinois; (5) have a phone number or mailing address in Illinois; or (6) advertise in Illinois. Valentine averred that the terms of the invoices for the meat were "F.O.B. Kent, Washington," and that, thus, the risk of loss passed within the State of Washington. Lastly, Valentine stated that no agent of Sysco had ever met with Ruprecht in Illinois.

Ruprecht filed a response to Sysco's motion to quash summons to which Ruprecht attached the affidavit of its employee Walter E. Sommers. In his affidavit, Sommers stated that Sysco required Ruprecht to set up a vendor account with Sysco. It faxed Ruprecht a "New Product Information Form," a "Hold Harmless Agreement," a "New Vendor Information Form," and an "EEOC Certificate of Compliance" to complete before Sysco would make a purchase. In addition, he claimed that Catherine Kayser, Sysco's vice-president of multi-unit sales, telephoned Ruprecht three times in Chicago to set up the vendor account.

Sommers then stated that on April 6, 1998, Sysco faxed Ruprecht a purchase order for approximately 702 pounds of prime steak ready strips, 882 pounds of prime 190A beef tenderloin, and 156 pounds of prime top sirloin complete center cut. On April 13, 1998, Sysco faxed Ruprecht another purchase order for approximately 634 pounds of prime steak ready strips, 875 pounds of prime 190A beef tenderloin, and 165 pounds of prime top sirloin complete center cut. Sommers explained that to produce the prime steak ready strips, Ruprecht's butchers trimmed strip steaks leaving only a one-eighth inch fat cover and less than a one-inch tail. The order of prime 190A beef tenderloin entailed resizing the meat to less than five pounds apiece and packing 10 pieces in each box. To produce the prime top sirloin complete center cut, Ruprecht's butchers trimmed all fat from the meat, resulting in 65% waste, and packed six pieces of meat, each approximately eight pounds, in each box. Sommers stated that Ruprecht produced all the items Sysco ordered according to Sysco's strict specifications. Prior to Sysco's order, Ruprecht had never sold prime top sirloin complete center cut. Lastly, Sommers stated that all of the modifications required by Sysco were done in Ruprecht's Chicago plant, after which the meat was shipped to Sysco in Seattle.

Sysco then filed the affidavits of Kayser and Paul Opray, Sysco's meat buyer, in support of its motion to quash service of process. In her affidavit, Kayser stated that, in late March or early April 1998, she spoke on the telephone to Bob Christiansen, a multi-unit sales representative for Sysco Food Services of Portland, Inc. (Sysco-Portland), and discussed a meeting he had attended in Portland, Oregon with Sommers, Chris Westcott, regional manager of McCormick and Schmick's (McCormick), and other representatives of McCormick and Sysco Food Services. Sysco-Portland provides food service products to various McCormick restaurants in the Portland area. Kayser maintained that Sommers had traveled from Chicago in order to meet with the McCormick and Sysco-Portland representatives and discuss the specific types of products and product packaging that Ruprecht provided.

Kayser then stated that, after the meeting, Westcott telephoned her to discuss Sysco's obtaining Ruprecht's meats for McCormick's Seattle-area restaurants and requested that she call Sommers about Ruprecht's products. After speaking to Westcott, Kayser then called Christiansen to discuss the meeting in Portland and Sysco's possible arrangement with McCormick. Kayser then telephoned Sommers in Chicago to tell him that Opray would contact him to place an order. Kayser averred that this was her only conversation with Sommers and that she did not speak with any other Ruprecht representative.

In his affidavit, Opray stated that he telephoned Sommers in Chicago to obtain some basic information used to complete vendor forms required by Sysco, including a certificate of insurance and a hold harmless agreement. Sysco required all food-service suppliers to provide such information -- even if Sysco only expected to order products from the vendor once or on a limited basis. After this initial telephone call, Opray and Sommers spoke on the phone briefly about two or three more times in order to finalize the vendor forms. Some of the calls were initiated by Opray and some by Sommers.

Opray claims that he did not spend much time discussing the meat products Sysco was going to order because Sommers had already established the specifications and packaging with McCormick at the Portland meeting. Opray simply obtained a description of the products from Sommers and entered the information into Sysco's product database so that he could generate a purchase-order form. Opray stated that although the meat products at issue were high quality, they were common prime cuts of beef that were available in many fine dining restaurants and steak houses and that dining establishments with a prime-beef program such as McCormick's required specifications similar or identical to the specifications for the products ordered from Ruprecht. Lastly, Opray stated that he could obtain identical products from several meat companies in the Seattle market and that meat companies, such as Ruprecht, prepare these products on a daily basis.

As noted above, the circuit court denied Sysco's motion to quash service of process. The court did so without holding an evidentiary hearing. It then ordered that Sysco file an answer to the complaint or otherwise plead.

On appeal, Ruprecht maintains that the circuit court properly exercised jurisdiction over Sysco pursuant to the following portion of Illinois' long-arm statute:

"(a) Any person, whether or not a citizen or resident of this State, who in person or through an agent does any of the acts hereinafter enumerated, thereby submits such person, and, if an individual, his or her personal representative, to the jurisdiction of the courts of this ...


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