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Woller v. McHale Engineering Ltd.6/28/2005
Appellant challenges the district court's denial of its motion to dismiss the complaint for lack of personal jurisdiction. Because appellant has sufficient minimum contacts with Minnesota to support the exercise of personal jurisdiction, we affirm.
FACTS
On June 11, 2000, respondent Steven Woller was injured while operating a bale wrapper on his farm in Minnesota. This machine wraps large bales of hay with plastic. In addition to farming, Woller sells agricultural equipment. Respondent Vermeer Manufacturing Company (Vermeer) supplied Woller with the bale wrapper and encouraged Woller to use it on his farm as part of a special promotion. The bale wrapper that injured Woller was identified as a Vermeer SW-3500, but was manufactured by appellant, McHale Engineering Limited (McHale).
Vermeer is an Iowa corporation, which primarily designs and manufactures a variety of tree and agricultural equipment. Vermeer products are distributed through a network of 474 independent, authorized dealers in 44 states throughout the United States. Although the highest concentrations of Vermeer dealers are in Nebraska, Missouri, and Arkansas; Vermeer has 19 dealers in Minnesota.
McHale manufactures agricultural equipment. McHale is incorporated and has its principal place of business in Ireland. In 1997, Vermeer and McHale entered into a Supply and Licensing Agreement (Agreement), under which McHale would manufacture certain equipment and Vermeer would sell those items under its name. McHale relied on its original design and Vermeer then performed a safety review and requested seven to eight changes. These changes were not to the design, but rather involved location of the safety stickers and painting the machines in Vermeer colors. According to the Agreement McHale maintained ultimate approval of these changes. Pursuant to the Agreement, McHale supplied Vermeer with operator and parts manuals, which Vermeer relied on in preparing owner manuals that it distributed with the equipment, including the Vermeer SW-3500. Nothing identified the equipment as having been designed or manufactured by McHale. The manuals listed Vermeer as the only company to call for questions and problems.
McHale did not directly market or sell any of the Vermeer labeled equipment. However, in 1997 the director of McHale attended a sales meeting in Iowa of Vermeer dealers from throughout the United States. The director also initiated a meeting in which the director discussed Vermeer's sales volumes of McHale equipment throughout the United States. To promote sales, McHale rewarded two Vermeer territory managers with the most sales and the largest increase of sales with paid trips to Ireland. McHale did not advertise or solicit any business in Minnesota and had no connection with the bale wrappers once they were shipped to Vermeer. Since the 1997 Agreement, Vermeer has sold 840 pieces of McHale manufactured equipment in the United States and 41 in Minnesota. Twenty-three bale wrappers, including 16 Vermeer SW-3500 bale wrappers, have been sold in Minnesota.
According to the Agreement, "McHale warrants that Products supplied and manufactured by McHale hereunder shall be free of defects and workmanship for a period of twelve (12) months from the date of delivery to the retail customers." The Agreement also provides that With respect to Products manufactured by McHALE and sold to VERMEER, McHALE agrees to defend, protect, indemnify and hold harmless VERMEER . . . against any and all claims, including expenses and reasonable attorney fees, for injuries or damages of any kind . . . including, but not limited to, claims in the nature of strict liability in tort, negligence, or breach of
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