''Burger King v. Rudzewicz'', 471 U.S. 462 (1985), is a notable case in United States civil procedure that came before the

Supreme Court of the United States The Supreme Court of the United States (SCOTUS) is the highest court in the federal judiciary of the United States. It has ultimate appellate jurisdiction over all U.S. federal court cases, and over state court cases that involve a point o ...

addressing personal jurisdiction.

Background

John Rudzewicz was a citizen and resident of the state of Michigan and was the senior partner in a Detroit

accounting Accounting, also known as accountancy, is the measurement, processing, and communication of financial and non financial information about economic entities such as businesses and corporations. Accounting, which has been called the "languag ...

firm. He was approached by Brian MacShara, the son of a business acquaintance, who suggested that they open a

Burger King Burger King (BK) is an American-based multinational chain store, chain of hamburger fast food restaurants. Headquartered in Miami-Dade County, Florida, the company was founded in 1953 as Insta-Burger King, a Jacksonville, Florida–based res ...

franchise together. The parties eventually reached an agreement whereby Rudzewicz provided the necessary capital and MacShara assumed the responsibility of managing the restaurant. The partners agreed to share profits equally. Rudzewicz and MacShara applied jointly to Burger King's district office in Birmingham, Michigan in the fall of 1978. The application was forwarded to Burger King's office in Miami, Florida and the parties reached a preliminary agreement to take the franchise for an existing Burger King location in the Drayton Plains area of Waterford Charter Township, Michigan in February 1979. MacShara attended the prescribed management courses at Burger King University in Miami in order to learn to operate a Burger King franchise. The partners purchased $165,000 in restaurant equipment from Davmor Industries, a Burger King corporate division located in Miami. Under the franchise agreement, Rudzewicz and MacShara were to remit their franchise fees and

royalties A royalty payment is a payment made by one party to another that owns a particular asset, for the right to ongoing use of that asset. Royalties are typically agreed upon as a percentage of gross or net revenues derived from the use of an asset o ...

to Burger King's Florida headquarters. Due to an economic downturn, the defendants were unable to make their monthly payments to Burger King, prompting the Florida-based corporation to file a lawsuit in Florida for

breach of contract Breach of contract is a legal cause of action and a type of civil wrong, in which a binding agreement or bargained-for exchange is not honored by one or more of the parties to the contract by non-performance or interference with the other party ...

and infringement of Burger King's trademarks and

service marks A service mark or servicemark is a trademark used in the United States and several other countries to identify a service rather than a product. When a service mark is federally registered, the standard registration symbol ® or "Reg U.S. ...

through the defendants' unauthorized operation as a Burger King restaurant after the defendants received notice to vacate the premises.

Burger King's lawsuit

Burger King brought a diversity action pursuant to

28 U.S.C. Title 28 (Judiciary and Judicial Procedure) is the portion of the United States Code (federal statutory law) that governs the federal judicial system. It is divided into six parts: * Part I: Organization of Courts * Part II: Department of Jus ...

§ 1332(a). against the defendants in the United States District Court for the Southern District of Florida in May 1981. Burger King also invoked the Court's original jurisdiction over disputes arising under federal trademark law pursuant to 28 U.S.C. § 1338(a). The District Court held that Florida had jurisdiction because of a statute that allowed the state to extend jurisdiction to anyone breaching a contract within the state. The United States Court of Appeals for the Eleventh Circuit reversed the court's decision, finding that even though the defendants had minimum contacts with Florida, to exercise jurisdiction over the defendants would be fundamentally unfair and thus violate the

due process clause In United States constitutional law, a Due Process Clause is found in both the Fifth and Fourteenth Amendments to the United States Constitution, which prohibits arbitrary deprivation of "life, liberty, or property" by the government except as ...

of the Fourteenth Amendment. Burger King then appealed to the Supreme Court.

Opinion of the Court

The Supreme Court concluded that the defendants purposefully availed themselves of the protections of the forum state (Florida) and were, therefore, subject to jurisdiction there. The Court reasoned that the defendants had a "substantial and continuing" relationship with Burger King in Florida and that due process would not be violated because the defendants should have reasonably anticipated being summoned into court in Florida for breach of contract. Justice Brennan's general "Reasonableness" or "Fairness" test was evolved into Justice O'Connor's five-factor test of reasonableness announced two years later in '' Asahi Metal Industry Co. v. Superior Court'', 480 U.S. 102 (1987).

Dissent

Justice Stevens John Paul Stevens (April 20, 1920 – July 16, 2019) was an American lawyer and jurist who served as an associate justice of the Supreme Court of the United States from 1975 to 2010. At the time of his retirement, he was the second-olde ...

dissented in an opinion joined by Justice White. Stevens observed that Rudzewicz had never been to Florida and had no business established in Florida. In Stevens' view, Rudzewicz could not have anticipated being summoned into court in Florida, and it violated the due process clause to require a small businessman in Michigan to defend himself against litigation in Florida.

References

External links