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Eagle Technology v. Expander Americas, 14-1646 (2015)

Court: Court of Appeals for the Eighth Circuit Number: 14-1646 Visitors: 57
Filed: Apr. 22, 2015
Latest Update: Mar. 02, 2020
Summary: United States Court of Appeals For the Eighth Circuit _ No. 14-1646 _ Eagle Technology; William Bakker lllllllllllllllllllll Plaintiffs - Appellants v. Expander Americas, Inc.; Expander System Global, AB lllllllllllllllllllll Defendants - Appellees _ Appeal from United States District Court for the Eastern District of Missouri - St. Louis _ Submitted: January 14, 2015 Filed: April 22, 2015 _ Before SMITH, BENTON, and SHEPHERD, Circuit Judges. _ SMITH, Circuit Judge. Eagle Technology, Inc. ("Eagl
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                 United States Court of Appeals
                            For the Eighth Circuit
                        ___________________________

                                No. 14-1646
                        ___________________________

                        Eagle Technology; William Bakker

                      lllllllllllllllllllll Plaintiffs - Appellants

                                           v.

             Expander Americas, Inc.; Expander System Global, AB

                      lllllllllllllllllllll Defendants - Appellees
                                       ____________

                    Appeal from United States District Court
                  for the Eastern District of Missouri - St. Louis
                                  ____________

                           Submitted: January 14, 2015
                              Filed: April 22, 2015
                                 ____________

Before SMITH, BENTON, and SHEPHERD, Circuit Judges.
                           ____________

SMITH, Circuit Judge.

      Eagle Technology, Inc. ("Eagle") and its sole owner, Willem F. Bakker,
brought suit against Expander Americas, Inc. ("Expander Americas") and its parent
company, Expander System Global, AB ("Expander Global"), after each company
terminated contracts with Eagle and Bakker respectively. As to Expander Global, the
district court1 concluded that it could not assert personal jurisdiction because
Expander Global is a Swedish corporation without sufficient contacts with the State
of Missouri. The court granted summary judgment in favor of Expander Americas on
the remaining contract claims based on the statute of frauds. Eagle and Bakker appeal
both rulings. We affirm.

                                  I. Background
      Expander Global conducts no business and functions merely as a holding
company for its wholly owned subsidiary, Expander System Sweden, AB ("Expander
Sweden"), another Swedish corporation. Expander Sweden, in turn, wholly owns
Expander Americas as its subsidiary. As their names suggest, Expander Sweden and
Expander Americas primarily conduct their business in Europe and the United States
respectively, manufacturing industrial pins used in heavy machinery.

      On February 18, 2010, Eagle entered into an Independent Contractor
Agreement (the "Agreement") with Expander Americas to provide consulting
services. The Agreement contained the following relevant provisions:

      4.     Term and Termination

             A.    The Term of this Agreement shall begin this 1st day of January,
                   2010, and shall continue for a period of one (1) year; thereafter,
                   this Agreement shall be automatically renewed for successive
                   periods of one (1) year each, unless terminated as provided
                   herein.

             B.    Either party may terminate this Agreement at any time by mutual
                   agreement of the parties hereto or providing the other party with
                   ninety (90) days prior written notice . . . .


      1
       The Honorable Henry E. Autrey, United States District Judge for the Eastern
District of Missouri.

                                         -2-
                                         ***

      13.    Governing Law. The construction and interpretation of this Agreement
             shall at all times and in all respects be governed by the laws of the State
             of Arizona.

                                         ***

      15.    Miscellaneous. No amendment or modification of this Agreement shall
             be effective unless executed in writing by the parties hereto. . . . This
             Agreement constitutes the entire agreement of the parties and is intended
             as a complete agreement of the promises, representations, negotiations,
             discussions, and agreements that may have been made in connection
             with the subject matter hereof, and supersedes any prior oral or written
             agreement. . . .

A document entitled Exhibit A was attached to the Agreement. It provided that
Expander Americas would compensate Bakker at a rate of $4,583.33 per month.

       These consulting services soon increased, and Expander Americas requested
that Eagle become its Chief Information Officer (CIO) and Chief Financial Officer
(CFO) in March 2010. On May 10, 2010, Bakker sent an email to Expander
Americas's Chief Executive Officer (CEO), Ron Randen, negotiating modifications
to the existing Agreement in light of Eagle's new position. In pertinent part, Bakker's
email stated "[a]ttached the first draft of half of the Plan. . . . Resume and Exhibit B
of our service agreement to continue the dialogue on me joining Expander fulltime."
Exhibit B stated that it "replace[d] Exhibit A" and would become effective on
"6/1/2010."

      Also, as part of the new arrangement, Exhibit B provided that Expander
Americas was to raise Eagle's compensation rate to $7,500 per month. Exhibit B also
stated that "[t]he term of this agreement is 24 months (5/31/2012)." Randen
responded the next day, asking if Bakker could "focus more on CFO and CIO

                                          -3-
functions and activities in the 'Professional Experience'? All is good but this focus
will help with the board for global responsibilities." Randen's electronic signature,
which included his title as CEO of Expander Americas, ended the email. Bakker
concedes that the parties never executed Exhibit B. Randen later admitted in a
deposition, however, that he believed that Exhibit B became operational and replaced
Exhibit A's terms. Further, Expander Americas paid Eagle $7,500 every month
pursuant to Exhibit B until the contract was terminated.

      The Agreement soon led to a relationship between Expander Global—parent
of Expander America—and Bakker. In November 2010, after working together for
several months, Expander Global's CEO, Roger Svensson, sent an email to all
employees of the Expander companies announcing that Bakker had been appointed
as Expander Global's CIO and CFO. There was never any written employment
agreement memorializing this relationship. Bakker performed several of his duties
from his home near St. Louis, Missouri. These duties included acting as a manager
on projects to improve the financial and information technology systems of the
Expander companies and serving as the secretary of the Expander Global Board of
Directors and the Expander executive team. As to contacts between the foreign
companies and the State of Missouri, Bakker specifically contends that he attended
a planning meeting in St. Louis with representatives from both Expander Sweden and
Expander Americas. He also asserts that he participated in telephone conference calls
and had several hundred contacts via phone and email with employees of the
Expander companies and outside consultants.

      On June 19, 2011, Expander Global terminated Bakker from his position as
CIO and CFO. Less than a week later, Expander Americas also terminated its
agreement with Eagle in writing. The termination letter, signed by Randen, stated that
Bakker had "indicated that if [he] did not receive higher compensation from
Expander, [he] would go elsewhere and no longer provide the services as set forth in
[the Agreement]." Based upon "an email from Roger Svensson to [Bakker],

                                         -4-
confirming that there would not be an increase in compensation[] . . . [Expander
Americas] . . . decided to accept [Bakker's] decision to terminate the agreement
between [the] companies." The next month, in July 2011, Randen himself was let go
from his CEO position at Expander Americas.

        Eagle then filed the instant suit against Expander Americas seeking damages
alleging breach of contract and promissory estoppel; Bakker filed suit against
Expander Global for quantum meruit. The district court dismissed the quantum meruit
action pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure for lack of
personal jurisdiction. Expander Global argued that it did not have the requisite
minimum contacts with Missouri to be subject to the Missouri Long-Arm Statute or
to satisfy due process. While Bakker had alleged various facts in his complaint, such
as Expander Global sending employees to Missouri, the district court found that
Bakker had not met his burden of rebutting Expander Global's claims by "'proving
facts supporting personal jurisdiction'" with "'affidavits and exhibits presented with
the motions and in opposition thereto.'" (Quoting Wells Dairy, Inc. v. Food Movers
Int'l, Inc., 
607 F.3d 515
, 518 (8th Cir. 2010).) Without such evidence, the court found
that it could not assert personal jurisdiction over Expander Global because it did not
have any contacts with Missouri. "It was not licensed to do business in the state; it did
not advertise within the state; it did not send employees to the state; no money was
received or sent to the state; it quite frankly had no presence within the State of
Missouri."

      The district court also granted summary judgment in favor of Expander
Americas on the remaining claims. Following the parties' choice-of-law provision in
the Agreement, the court analyzed whether Exhibit B satisfied the Arizona statute of
frauds. As a preliminary matter, the court found that the statute of frauds applied
under Arizona case law because Exhibit B's 24-month term meant that this contract
modification could not be performed within one year. See Ariz. Rev. Stat. § 44-101.5.
In doing so, the court rejected Eagle's only argument on this matter—that Randen's

                                          -5-
deposition admission should be treated as a judicial admission to prove there was a
contract and that consequently, the statute of frauds should not apply because Randen
admitted that Exhibit B constituted an operative modification to the Agreement. The
court rejected this argument pursuant to Arizona law because only attorneys or parties
can make such judicial admissions. At the time of Randen's deposition, he was no
longer an employee of Expander Americas, and thus, he was never a party in the
litigation. As a result, the court found Exhibit B was covered by the statute of frauds.
Next, the court found that Exhibit B did not satisfy the statute of frauds's writing
requirement because Expander Americas, as party to be charged, did not sign the
document. The court rejected Eagle's argument that Randen's electronic signature on
his responding email constituted the necessary execution of Exhibit B, which was
attached to Bakker's email. To the contrary, the district court found that the email
exchange showed that Randen and Bakker were still in negotiation and that Exhibit
B had yet to be accepted by the parties.

                                     II. Discussion
      On appeal, Eagle and Bakker argue that the district court erred by finding it
could not assert personal jurisdiction over Expander Global and by granting summary
judgment in favor of Expander Americas on the remaining claims.

                   A. Personal Jurisdiction Over Expander Global
       We review a district court's decision finding lack of personal jurisdiction de
novo. Romak USA, Inc. v. Rich, 
384 F.3d 979
, 983 (8th Cir. 2004). "We approach our
analysis of personal jurisdiction on two levels, first examining whether the exercise
of jurisdiction is proper under the forum state's long-arm statute. If the activities of
the non-resident defendant satisfy the statute's requirements, we then address whether
the exercise of personal jurisdiction comports with due process." Dakota Indus., Inc.
v. Dakota Sportswear, Inc., 
946 F.2d 1384
, 1387–88 (8th Cir. 1991) (citations
omitted); see also 
Romak, 384 F.3d at 984
. Relevant to this appeal, the Missouri long-



                                          -6-
arm statute provides for personal jurisdiction over parties who transact business and
make contracts within Missouri. Mo. Rev. Stat. § 506.500(1)–(2).

       "Because 'the Missouri long-arm statute authorizes the exercise of jurisdiction
over non-residents to the extent permissible under the due process clause, we turn
immediately to the question whether the assertion of personal jurisdiction would
violate the due process clause.'" 
Romak, 384 F.3d at 984
(quoting Porter v. Berall,
293 F.3d 1073
, 1075 (8th Cir. 2002)). We employ a five-factor test to determine
whether asserting personal jurisdiction over a party comports with due process: "(1)
the nature and quality of the contacts with the forum state; (2) the quantity of those
contacts; (3) the relationship of those contacts with the cause of action; (4) Missouri's
interest in providing a forum for its residents; and (5) the convenience or
inconvenience to the parties." Myers v. Casino Queen, Inc., 
689 F.3d 904
, 911 (8th
Cir. 2012).

        Expander Global argues that it lacks the requisite contacts with Missouri to
fulfill factors (1)–(3). It contends that its only contact with the state of Missouri is its
business relationship with Bakker; it argues that such a relationship, on its own, fails
to justify imposing personal jurisdiction. We agree. In Scullin Steel Co. v. National
Railway Utilization Corp., we affirmed the district court's dismissal of an action for
lack of jurisdiction over a South Carolina corporation even though the corporation
contracted with a St. Louis factory to manufacture products in Missouri, delivered
products to the St. Louis factory, and sent payment for services to the factory. 
676 F.2d 309
, 313–14 (8th Cir. 1982). Like the present case, the non-resident corporation
in Scullin Steel was "not authorized to do business in Missouri, [had] no office . . . in
Missouri, own[ed] no real property in Missouri, and [had] no agent for service of
process or for any other purpose in Missouri." 
Id. at 310;
see also Austad Co. v.
Pennie & Edmonds, 
823 F.2d 223
, 226–27 (8th Cir. 1987) (finding that South Dakota
courts could not assert personal jurisdiction over a New York law firm that did not



                                            -7-
have any employees that resided in South Dakota or were licenced to practice law in
South Dakota, did not advertise there, and did not actively seek out clients there).

       Bakker points to the daily emails, phone calls, and other communications that
he had with personnel from all Expander companies that were directed to his
residence in Missouri to argue that Expander Global did have minimum contacts with
the state. This argument is unavailing because telephone calls, written
communications, and even wire-transfers to and from a forum state do not create
sufficient contacts to comport with due process such that a foreign corporation could
"reasonably anticipate being haled into court there." Viasystems, Inc. v. EBM-Papst
St. Georgen GmbH & Co., KG, 
646 F.3d 589
, 594 (8th Cir. 2011) (quotation
omitted); see also 
Porter, 293 F.3d at 1076
("Contact by phone or mail is insufficient
to justify exercise of personal jurisdiction under the due process clause." (citation
omitted)); Burlington Indus. v. Maples Indus., 
97 F.3d 1100
, 1103 (8th Cir. 1996)
(holding that 100 telephone calls by the defendant to the plaintiff were "insufficient,
alone, to confer personal jurisdiction" (citation omitted)). Accordingly, Bakker has
not carried his burden of establishing a prima facie case that federal courts in
Missouri can assert personal jurisdiction over Expander Global.

         B. Exhibit B's Enforceability Under the Arizona Statute of Frauds
       "We review de novo a district court's grant of summary judgment, affirming if
there is no genuine dispute as to any material fact and the movant is entitled to
judgment as a matter of law." Loftness Specialized Farm Equip., Inc. v. Twiestmeyer,
742 F.3d 845
, 849–50 (8th Cir. 2014) (quotations and citations omitted). We give the
non-moving party "the benefit of all reasonable inferences supported by the
evidence," but the non-moving party "has the obligation to come forward with
specific facts showing that there is a genuine issue for trial." 
Id. at 850
(quotation
omitted).




                                         -8-
       "Federal courts sitting in diversity apply the choice-of-law rules of the forum
state. Under Missouri law, a choice-of-law clause in a contract generally is
enforceable unless application of the agreed-to law is contrary to a fundamental
policy of Missouri." Cicle v. Chase Bank USA, 
583 F.3d 549
, 553 (8th Cir. 2009)
(quotations and citations omitted). Because the parties contracted to have Arizona law
control, we analyze the Arizona statute of frauds to determine whether Exhibit B
modified the operative terms of the Agreement.

      The Arizona statute of frauds, in relevant part, provides the following:

      No action shall be brought in any court in the following cases unless the
      promise or agreement upon which the action is brought, or some
      memorandum thereof, is in writing and signed by the party to be
      charged, or by some person by him thereunto lawfully authorized:

                                          ***

      5. Upon an agreement which is not to be performed within one year from the
      making thereof.

Ariz. Rev. Stat. § 44-101.

       Eagle first argues that the statute of frauds should not apply because the
Agreement's termination provision (paragraph 4.B) created a possibility that the
contract could have been completed in one year.2 Eagle did not raise this argument
before the district court. It is well settled that we will not consider an argument raised
for the first time on appeal. See Satcher v. Univ. of Ark. at Pine Bluff Bd. of Trs., 558


      2
       Ironically, Eagle did not raise its original argument before the district court on
appeal: that the statute of frauds does not apply because of the judicial admission
exception. Because Eagle has not raised this argument before this court, we consider
the argument waived.

                                           -9-
F.3d 731, 735 (8th Cir. 2009) ("[F]ailure to oppose a basis for summary judgment
constitutes waiver of that argument."); Smith v. City of Des Moines, Iowa, 
99 F.3d 1466
, 1473 (8th Cir. 1996) ("We will not reverse a grant of summary judgment on the
basis of an argument not presented below." (citation omitted)). Accordingly, we
decline to consider Eagle's new argument.3

       Eagle next argues that Exhibit B satisfies the writing requirement of the statute
of frauds. Eagle contends that Randen's email, stating that "All is good" and signed
with his electronic signature, is enough to satisfy the writing requirement. Eagle is
correct when asserting that emails that contain the material terms of an agreement that
are signed with electronic signatures similar to Randen's have been held to satisfy the
statute of frauds. In such cases, however, the statements in the emails were not
ambiguous as to their application to an attached agreement. See, e.g., Cloud Corp. v.
Hasbro, Inc., 
314 F.3d 289
, 295–96 (7th Cir. 2002) (finding that emails with the
sender's name was enough to satisfy the statute of frauds in a UCC case); Lamle v.
Mattel, Inc., 
394 F.3d 1355
, 1362 (Fed. Cir. 2005) (finding that an email signature
satisfied the California statute of frauds in an email that only contained the material
terms of a proposed agreement).



      3
        In its Reply Brief, Eagle argues that this new argument should be considered
on appeal because the district court's reasoning that the statute of frauds
applied—because Exhibit B's 24-month term meant that it could not be performed
within one year—had not been raised by the parties in their motion papers. Upon
review of the record, the Expander defendants argued that the statute of frauds should
apply for this very reason in their Memorandum of Law in Support of their Motion
for Partial Summary Judgment; Eagle simply chose not to reply to this argument in
its opposition. In any case, if Eagle was truly concerned about having an opportunity
to contest the district court's reasoning, it could have done so in a Rule 59(e) or Rule
60(b) motion to correct what Eagle perceived was a misapplication of the law. Had
it done so, Eagle could have contested the district court's reasoning and preserved this
argument for appeal.

                                         -10-
      This case, however, contains an additional element because Randen's "All is
good" comment is ambiguous as to which of the several documents attached to
Bakker's email he was referring: (1) "the first draft of half of the Plan"; (2) Bakker's
resume; or (3) "Exhibit B of our service agreement to continue the dialogue on me
joining Expander fulltime." (Emphasis added.)4 Further, Randen's "All is good"
statement occurred as he commented on Bakker's resume. Therefore, Randen's
statement does not provide a sufficiently clear declaration of approval of the proposed
agreement to satisfy the statute of frauds. Thus, we find that Randen's "All is good"
statement is ambiguous as to whether it specifically acts as a stamp of approval on
Exhibit B.5

       In an attempt to get over this hurdle, Eagle again raises a new argument on
appeal. Eagle argues that Randen's deposition testimony—in which he admitted that
he believed Exhibit B became the operative terms of the Agreement—should be used
to show he had the requisite intent to be bound. Thus, relying on this admission,
Eagle argues that the writing requirement of the statute of frauds is satisfied with his
email and electronic signature block.

      Below, Eagle did not use Randen's deposition testimony to show intent in order
to show that his email satisfies the statute of frauds. Rather, Eagle used Randen's
deposition testimony to seek a judicial admission to show that the statute of frauds
did not apply at all. As noted above, the inquiry into the statute of fraud's application

      4
       Bakker's own language shows that his initial email was not an offer, but rather
an invitation to continue negotiations. Thus, Randen's response could not be
considered a binding acceptance because Bakker's email was not a formal offer.
      5
       While it is a general rule that ambiguous language in an agreement should be
construed against the drafter and in favor of the other party, Mastrobuono v. Shearson
Lehman Hutton, Inc., 
514 U.S. 52
, 62–63 (1995), Randen's language is not a part of
the agreement at issue; instead, it is a statement that is ambiguous as to whether it
applies to the agreement at issue.

                                          -11-
is a preliminary question that is separate and apart from the inquiry into whether the
statute of frauds has been satisfied. Therefore, Eagle's usage and argument of
Randen's deposition testimony in the court below—to argue the preliminary
application question—is materially different from their usage and argument of
Randen's deposition testimony before this court—to make an "intent to be bound"
argument that the statute of frauds's writing requirement is satisfied. We decline to
consider this new argument not presented to the district court.

       Alternatively, Eagle also argues that Expander America's partial performance
satisfies the writing requirement. Eagle highlights Randen's approval and signatures
on Eagle's invoices that billed for $7,500 every month for nearly a year before the
Agreement was ultimately terminated. Eagle argues that Randen's approval of such
invoices shows intent to be bound by the terms of Exhibit B, which modified the
original payment terms in Exhibit A from $4,583.33 to $7,500 per month. This
argument is unavailing under Arizona law because partial performance can only be
utilized when seeking an equitable remedy. "[W]here a party attempting to enforce
an oral agreement seeks an equitable remedy, such as specific performance, the
equitable doctrines of estoppel and part performance are available to him. Where he
seeks only a legal remedy, such as money damages for breach, they are not." William
Henry Brophy Coll. v. Tovar, 
619 P.2d 19
, 23 (Ariz. Ct. App. 1980); see also
Rudinsky v. Harris, 
290 P.3d 1218
, 1224 (Ariz. Ct. App. 2012) (citing Tovar in
rejecting the plaintiff's argument that partial performance should satisfy the Arizona
statute of frauds). Therefore, Eagle's exclusive request for legal damages forecloses
its partial performance argument. Consequently, Eagle has failed, as a matter of law,
to show that Randen's email and subsequent signing of checks and invoices in partial
performance satisfies the writing requirement of the statute of frauds.

                                  III. Conclusion
      For the reasons stated herein, we affirm.
                      ______________________________


                                        -12-

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