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Chapter 2 Cases THE COURT SYSTEM BRIEF 2.10 (Supplement), page 1 Cole v. Mileti US Court of Appeals, 6 Circuit - 1998 Case Background: Nick Mileti, a resident of California, co-produced a movie called Streamers and organized a corporation, Streamers International Distributors, Inc., to distribute the film. Joseph Cole, a resident of Ohio, bought two hundred shares of Streamers stock. Cole also lent the firm $475,000, which he borrowed from Equitable Bank of Baltimore. The film was unsuccessful. Mileti agreed to repay Cole's loan in a contract arranged through phone calls and correspondence between California and Ohio. When Mileti did not repay the loan, the bank sued Cole, who in turn filed a suit against Mileti in a federal district court in Ohio. The court entered a judgment against Mileti. He appealed to the U.S. Court of Appeals for the Circuit, arguing in part that the district court's exercise of jurisdiction over him was unfair MERRITT, Circuit Judge There is a three-part test to determine whether specific jurisdiction exists over a nonresident defendant like Mileti. First, the defendant must purposefully avail himself of the privilege of conducting activities within the forum state (the state in which the court sits]; second, the cause of action must arise from the defendant's activities there, and third, the acts of the defendant or consequences caused by the defendant must have a substantial enough connection with the forum state to make its exercise of jurisdiction over the defendant fundamentally fair. If, as here, a nonresident defendant transacts business by negotiating and executing a contract via telephone calls and letters to an Ohio resident, then the defendant has purposefully availed himself of the forum by creating a continuing obligation in Ohio. Furthermore, if the cause of action is for breach of that contract, as it is here, then the cause of action naturally arises from the defendant's activities in Ohio. Finally, when we find that a defendant like Mileti purposefully availed himself of the forum and that the cause of action arose directly from that contact, we presume the specific assertion of personal jurisdiction was proper Decision: Case Background: Nick Mileti, a resident of California, co-produced a movie called Streamers and organized a corporation, Streamers International Distributors, Inc., to distribute the film. Joseph Cole, a resident of Ohio, bought two hundred shares of Streamers stock. Cole also lent the firm $475,000, which he borrowed from Equitable Bank of Baltimore. The film was unsuccessful. Mileti agreed to repay Cole's loan in a contract arranged through phone calls and correspondence between California and Ohio. When Mileti did not repay the loan, the bank sued Cole, who in turn filed a suit against Mileti in a federal district court in Ohio. The court entered a judgment against Mileti. He appealed to the U.S. Court of Appeals for the 6th Circuit, arguing in part that the district court's exercise of jurisdiction over him was unfair. MERRITT, Circuit Judge There is a three-part test to determine whether specific jurisdiction exists over a nonresident defendant like Mileti. First, the defendant must purposefully avail himself of the privilege of conducting activities within the forum state [the state in which the court sits]; second, the cause of action must arise from the defendant's activities there, and third, the acts of the defendant or consequences caused by the defendant must have a substantial enough connection with the forum state to make its exercise of jurisdiction over the defendant fundamentally fair. If, as here, a nonresident defendant transacts business by negotiating and executing a contract via telephone calls and letters to an Ohio resident, then the defendant has purposefully availed himself of the forum by creating a continuing obligation in Ohio. Furthermore, if the cause of action is for breach of that contract, as it is here, then the cause of action naturally arises from the defendant's activities in Ohio. Finally, when we find that a defendant like Mileti purposefully availed himself of the forum and that the cause of action arose directly from that contact, we presume the specific assertion of personal jurisdiction was proper Decision: The U.S. Court of Appeals for the 6th Circuit held that the district court could exercise personal jurisdiction over Mileti. The appellate court reasoned that a federal district court in Ohio can exercise personal jurisdiction over a resident creumormodestusiness in Ohio Chapter 2 Cases THE COURT SYSTEM BRIEF 2.10 (Supplement), page 1 Cole v. Mileti US Court of Appeals, 6 Circuit - 1998 Case Background: Nick Mileti, a resident of California, co-produced a movie called Streamers and organized a corporation, Streamers International Distributors, Inc., to distribute the film. Joseph Cole, a resident of Ohio, bought two hundred shares of Streamers stock. Cole also lent the firm $475,000, which he borrowed from Equitable Bank of Baltimore. The film was unsuccessful. Mileti agreed to repay Cole's loan in a contract arranged through phone calls and correspondence between California and Ohio. When Mileti did not repay the loan, the bank sued Cole, who in turn filed a suit against Mileti in a federal district court in Ohio. The court entered a judgment against Mileti. He appealed to the U.S. Court of Appeals for the Circuit, arguing in part that the district court's exercise of jurisdiction over him was unfair MERRITT, Circuit Judge There is a three-part test to determine whether specific jurisdiction exists over a nonresident defendant like Mileti. First, the defendant must purposefully avail himself of the privilege of conducting activities within the forum state (the state in which the court sits]; second, the cause of action must arise from the defendant's activities there, and third, the acts of the defendant or consequences caused by the defendant must have a substantial enough connection with the forum state to make its exercise of jurisdiction over the defendant fundamentally fair. If, as here, a nonresident defendant transacts business by negotiating and executing a contract via telephone calls and letters to an Ohio resident, then the defendant has purposefully availed himself of the forum by creating a continuing obligation in Ohio. Furthermore, if the cause of action is for breach of that contract, as it is here, then the cause of action naturally arises from the defendant's activities in Ohio. Finally, when we find that a defendant like Mileti purposefully availed himself of the forum and that the cause of action arose directly from that contact, we presume the specific assertion of personal jurisdiction was proper Decision: Case Background: Nick Mileti, a resident of California, co-produced a movie called Streamers and organized a corporation, Streamers International Distributors, Inc., to distribute the film. Joseph Cole, a resident of Ohio, bought two hundred shares of Streamers stock. Cole also lent the firm $475,000, which he borrowed from Equitable Bank of Baltimore. The film was unsuccessful. Mileti agreed to repay Cole's loan in a contract arranged through phone calls and correspondence between California and Ohio. When Mileti did not repay the loan, the bank sued Cole, who in turn filed a suit against Mileti in a federal district court in Ohio. The court entered a judgment against Mileti. He appealed to the U.S. Court of Appeals for the 6th Circuit, arguing in part that the district court's exercise of jurisdiction over him was unfair. MERRITT, Circuit Judge There is a three-part test to determine whether specific jurisdiction exists over a nonresident defendant like Mileti. First, the defendant must purposefully avail himself of the privilege of conducting activities within the forum state [the state in which the court sits]; second, the cause of action must arise from the defendant's activities there, and third, the acts of the defendant or consequences caused by the defendant must have a substantial enough connection with the forum state to make its exercise of jurisdiction over the defendant fundamentally fair. If, as here, a nonresident defendant transacts business by negotiating and executing a contract via telephone calls and letters to an Ohio resident, then the defendant has purposefully availed himself of the forum by creating a continuing obligation in Ohio. Furthermore, if the cause of action is for breach of that contract, as it is here, then the cause of action naturally arises from the defendant's activities in Ohio. Finally, when we find that a defendant like Mileti purposefully availed himself of the forum and that the cause of action arose directly from that contact, we presume the specific assertion of personal jurisdiction was proper Decision: The U.S. Court of Appeals for the 6th Circuit held that the district court could exercise personal jurisdiction over Mileti. The appellate court reasoned that a federal district court in Ohio can exercise personal jurisdiction over a resident creumormodestusiness in Ohio