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The case of Burger King Corp v. Rudzewicz, 471 U.S. 462 (1985), involved two Detroit men who negotiated with the Michigan office of Burger King Corp. to secure a franchise. Burger King granted the franchise.
The Detroit franchisees then purchased $165,000 worth of restaurant equipment from Burger King’s Miami headquarters. In addition, one of the franchisees attended a restaurant-management course in Miami. The franchisees were required to remit franchise fees and royalties to Burger King in Miami, but they were unable to pay.
Burger King sued in federal district court in Florida under diversity and trademark jurisdiction. The franchisees contested jurisdiction, arguing personal jurisdiction was improper in Florida. The district court concluded jurisdiction was proper, but the appellate court reversed.
Ultimately, the United States Supreme Court granted certiorari to consider whether minimum contacts were satisfied. A majority of the Court concluded that minimum contacts were present because the franchisees had purposefully directed their activities toward the State of Florida. The Court also articulated a number of factors to help determine whether personal jurisdiction is proper, including the burden on the defendant and the competing interests of the plaintiff, the forum state, and interstate commerce.
This case was significant for its rejection of any “talismanic jurisdictional formulas” in favor of a reasonableness/fairness-based assessment of personal jurisdiction.