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Brahm Industries, Inc. v. Wildwood Industries

August 7, 2008


The opinion of the court was delivered by: Byron G. Cudmore, U.S. Magistrate Judge


The Court has familiarity with the background in this case, as previously set forth in the Court's order of May 6, 2008 (d/e 25). Pursuant to that order, Wildwood Industries, Inc. ("Wildwood") has filed a motion to reopen this case, join Ross Vincent ("Vincent") and Superior Plastics, LLC ("Superior Plastics") as additional parties under Fed. R. Civ. P. 25(c), and enforce the settlement agreement entered into between Wildwood and Brahm Industries, Inc., ("Brahm Industries") against Vincent and Superior Plastics.

The Court has diversity jurisdiction. The parties do not dispute that the amount at issue exceeds $75,000. See Wildwood's Answer and Affirmative Defenses (d/e 6)(alleging that Wildwood paid over $706,000 to Brahm Industries for making molds that are the subject of the current dispute). Brahm Industries is a Canadian corporation now in receivership in Canada. Vincent is a citizen of Michigan or Canada. Superior Plastics is a citizen of Michigan. (d/e 25 para 21; d/e 32, para. 21).

Vincent and Superior Plastics ask that Wildwood's motion be denied because of insufficient service of process and for lack of personal jurisdiction. For the reasons below, the Court concludes that service of the motion complied with Fed. R. Civ. P. 25(a)(3) and Fed. R. Civ. P. 4. The Court further concludes that it has specific personal jurisdiction over Vincent and Superior Plastics.

I. Service of Process

Vincent and Superior Plastics contend that a summons was required to be served on them with Wildwood's motion. They do not cite any authority for that proposition, nor is the Court aware of any.

Fed. R. Civ. P. 25(c) states:

Transfer of Interest. If an interest is transferred, the action may be continued by or against the original party unless the court, on motion, orders the transferee to be substituted in the action or joined with the original party. The motion must be served as provided in Rule 25(a)(3).

Fed. R. Civ. P. 25(a)(3) states:

Service. A motion to substitute, together with a notice of hearing, must be served on the parties as provided in Rule 5 and on nonparties as provided in Rule 4. . . . . Service may be made in any judicial district.

Fed. R. Civ. P. 4 requires summons to be served with a Complaint, but the present motion is not a Complaint. Rule 25(a)(3) requires service in the manner that a summons is served, not service of a summons itself. This was explicitly stated in the prior version of the Rule, which required nonparties to be served "in the manner provided in Rule 4 for the service of a summons, . . . ." Fed. R. Civ. P. 25(a)(1)(version in effect before December 1, 2007). The revised version omits that phrase because it is unnecessary--"service as provided in Rule 4" plainly means the manner of service. Commentary on 2007 Amendment to Rule 25 ("The language of Rule 25 has been amended as part of the general restyling . . . to make them more easily understood . . . . These changes are intended to be stylistic only."). A motion under Rule 25(a)(3) must be served like a summons, not with a summons. Vincent and Superior Plastics make no other objections to the sufficiency of service of process, and it appears from the returns of service that service was effected in accordance with Rule 4. Accordingly, the Court finds that Wildwood properly served its motion.

II. Personal Jurisdiction: Due Process

Vincent and Superior Plastics argue that exercising personal jurisdiction over them would offend due process because minimum contacts do not exist to support personal jurisdiction. Wildwood bears the burden of making a prima facie case for personal jurisdiction. Citadel Group Ltd. V. Washington Regional Medical Center, - F.3d. -, 2008 WL 2971807 *2 (7th Cir. 2008). "A federal court sitting in diversity has personal jurisdiction only where a court of the state in which it sits would have such jurisdiction." Id. Illinois has a "'catch-all'" statutory provision that allows for personal jurisdiction if permitted by the Illinois and U.S. Constitutions. Id. Thus the Court focuses only on the federal due process analysis, for if personal jurisdiction is permissible under the U.S. Constitution, then it is permissible under Illinois law. Id.*fn1

If personal jurisdiction is challenged . . . , the court must decide whether any material facts are in dispute. If so, it must hold an evidentiary hearing to resolve them, at which point the party asserting personal jurisdiction must prove what it alleged. Until such a hearing takes place, the party asserting ...

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