Toshiba Glob. Commerce Sols., Inc. v. Smart & Final Stores LLC

Toshiba Glob. Commerce Sols., Inc. v. Smart & Final Stores LLC, 2020 NCBC 95.

STATE OF NORTH CAROLINA IN THE GENERAL COURT OF JUSTICE
SUPERIOR COURT DIVISION
DURHAM COUNTY 20 CVS 2559

TOSHIBA GLOBAL COMMERCE
SOLUTIONS, INC.,

Plaintiff,
ORDER AND OPINION ON
v. DEFENDANT’S MOTION TO DISMISS

SMART & FINAL STORES LLC,

Defendant.

1. This action arises out of a services agreement between Toshiba Global

Commerce Solutions, Inc. (“Toshiba”) and Smart & Final Stores LLC (“Smart &

Final”). Toshiba brought suit, claiming that Smart & Final breached and then

repudiated the agreement. Smart & Final now contends that the Court lacks

personal jurisdiction over it and moves to dismiss the complaint on that basis. (ECF

No. 9.) For the following reasons, the Court DENIES the motion.

Robinson, Bradshaw & Hinson, P.A., by Edward F. Hennessey, IV,
Matthew Sawchak, Erik R. Zimmerman, and Benjamin C. DeCelle, for
Plaintiff Toshiba Global Commerce Solutions, Inc.

Ellis & Winters LLP, by Paul K. Sun, Jr. and Kelly Margolis Dagger, for
Defendant Smart & Final Stores LLC.

Conrad, Judge.

I.
DISCUSSION

2. When a defendant challenges personal jurisdiction, “the Court may decide

the matter based on affidavits.” Capitala Grp., LLC v. Columbus Advisory Grp. LTD,

2018 NCBC LEXIS 183, at *3 (N.C. Super. Ct. Dec. 3, 2018) (citation and quotation
marks omitted). “If both parties submit dueling affidavits, the trial judge must

determine the weight and sufficiency of the evidence presented in the affidavits much

as a juror.” Id. (citation and quotation marks omitted). The burden is on the plaintiff

to establish personal jurisdiction by a preponderance of the evidence. See id.

3. The parties have submitted dueling affidavits and additional exhibits in

support of and in opposition to Smart & Final’s motion. The Court held a hearing on

October 29, 2020. Having considered all relevant matters, the Court finds the

following facts by a preponderance of the evidence and makes the following

conclusions of law.

A. Findings of Fact

4. Based in Durham, North Carolina, Toshiba makes and sells point-of-sale

products used by retailers—for example, scanners, monitors, and related checkout

devices. (See Margosian Aff. ¶¶ 3–5, ECF No. 21.3.) It also offers support services

for its products and those made by others. (See Margosian Aff. ¶¶ 4, 6.)

5. Smart & Final is a California company that operates a chain of warehouse-

style grocery stores in the western United States. (See 1st Kumar Aff. ¶¶ 3, 4, 6, ECF

No. 9.1.) Until recently, one of its subsidiaries operated restaurant supply and

wholesale food stores in the same region. (See 1st Kumar Aff. ¶ 5.)

6. In late 2017, Smart & Final began searching for a service provider to

maintain and repair point-of-sale equipment at its stores. (See Wong Aff. ¶¶ 3, 4,

ECF No. 9.2.) One of the vendors it contacted was Toshiba. (See Wong Aff. ¶ 4.) The

parties promptly signed a nondisclosure agreement, notable only because it lists
Toshiba’s North Carolina address at the top. (See White Aff. ¶ 4 & Ex. A, ECF No.

21.4.) Over the next few months, Toshiba sent pitch materials and a formal proposal

for a mix of products and services. Toshiba touted its technology (hardware and

software), national presence (a fleet of technician vans coupled with a network of

stocking locations to house inventory), and support infrastructure (a central repair

depot and an “expert staff of trained personnel . . . at our corporate HQ” in North

Carolina). (See, e.g., White Aff. Ex. C at 5, 7, 10–11, 21–22; White Aff. Ex. E at 13.)

Ultimately, though, Smart & Final went with a different vendor. (See Wong Aff. ¶ 4.)

7. Evidently, that relationship didn’t work out, and soon Smart & Final was

looking for a new vendor. It reached out to Toshiba a second time and requested

another proposal. (See 1st Kumar Aff. ¶¶ 11–13; White Aff. ¶ 14.) Most of the

negotiations took place via e-mail and telephone between Smart & Final

representatives in California and Toshiba representatives in California and Texas.

(See 1st Kumar Aff. ¶¶ 15–17; White Aff. ¶ 14.) There was also at least one in-person

meeting at Smart & Final’s California headquarters. (See 1st Kumar Aff. ¶ 15.)

8. This time, the negotiations were fruitful, producing a services agreement in

March 2019. (See Def.’s Ex. 4, ECF No. 9.4 [“Servs. Agrmt.”].) In a nutshell, Toshiba

agreed to provide maintenance and repair services for point-of-sale equipment at all

Smart & Final stores for three years. (See Servs. Agrmt. Attach. A.) Smart & Final

could renew the agreement for additional one-year terms with written notice to

Toshiba’s North Carolina headquarters. (See Servs. Agrmt. §§ 15, 23.) A
choice-of-law provision states that New York law governs the agreement. (See Servs.

Agrmt. § 26.)

9. Smart & Final selected two service options: “On-Site Repair” and “Advanced

Exchange Plus.” (Servs. Agrmt. § 5, Attach. C; see also 2d Kumar Aff. ¶ 6, ECF No.

29.1.) On-Site Repair means just what it says: a Toshiba technician would travel to

a given store and try to repair defective equipment on site. (See Servs. Agrmt. § 5,

Attach. C.) Advanced Exchange Plus, on the other hand, is a replacement service.

This option calls for the technician to replace the defective part with a working unit

taken from inventory called seed stock. (See Servs. Agrmt. § 5.) Although Smart &

Final could have chosen to own and maintain the seed stock itself, it shifted that

burden to Toshiba. (See Servs. Agrmt. § 5 (“Advanced Exchange Service” versus

“Advanced Exchange Plus Service”).) Toshiba also took responsibility for installing

replacement parts and for “the return of the [defective] Product back to [its] depot.”

(Servs. Agrmt. Attach. C.) 1

10. Both service options are geared toward addressing problems as they arise.

Determined “to operate [its] stores without interruption,” Smart & Final put a

premium on speed. (2d Kumar Aff. ¶ 6.) The agreement specifies response times and

performance goals typically based on same-day or next-day service. (See Servs.

Agrmt. Attachs. A, B; 2d Kumar Aff. ¶ 11.) Along with making its technicians

1 Toshiba also offered a “Depot Repair” option, which requires the customer to remove the

defective product, ship it to a Toshiba facility for repair, and then reinstall the part after
repair. (Servs. Agrmt. § 5.) Smart & Final did not select that option. (See 2d Kumar Aff.
¶ 10; Servs. Agrmt. Attach. C.)
available seven days a week, Toshiba agreed to “provide an infrastructure and

support structure to meet” its obligations. (Servs. Agrmt. Attach. C.)

11. These requirements are reflected in the price. Attachment A details the

prices for repair and replacement services for dozens of products, based in part on

estimates of the amount of seed stock needed, the expected response time, and the

number of anticipated service calls. It also states various pricing assumptions,

including that Toshiba would own the seed stock and “image/configure units during

the receive and repair process at our Depot.” (Servs. Agrmt. Attach. A.) For the

Advanced Exchange Plus option, the price sheet assumes that a “technician will meet

[the] part on-site that is shipped from the Toshiba depot,” noting that the replacement

“part for [a] failed unit [would be] available under Next Business Day support.”

(Servs. Agrmt. Attach. A.)

12. Although the agreement doesn’t say so, the “depot” is part of Toshiba’s

“Tricenter operations hub” in North Carolina. (See, e.g., Glendenning Aff. ¶¶ 2–6, 9,

ECF No. 21.5; White Aff. Ex. E at 13.) This is where Toshiba managed the seed stock

and repaired failed equipment throughout its relationship with Smart & Final. (See

Glendenning Aff. ¶¶ 9, 10, 12, 13.) Before the “go live date” for the services

agreement, employees at the depot estimated the seed stock needed to get started,

procured it (because Smart & Final used non-Toshiba equipment), and then shipped

it to field technicians and stocking locations. (Glendenning Aff. ¶ 10.) As time went

by, the depot received and repaired equipment that technicians could not fix on site.

(See Glendenning Aff. ¶¶ 11, 12.) The depot then returned these repaired items to
the seed stock or, if a part was beyond repair, replenished the stock with new

equipment. (See Glendenning Aff. ¶ 13; see also 2d Kumar Aff. ¶ 14.)

13. Over the course of their relationship, Toshiba handled about 7,200 repair

tickets for Smart & Final. (See Glendenning Aff. ¶ 15.) Some involved purely on-site

repairs. (See Glendenning Aff. ¶ 16.) Many others required support from Toshiba’s

depot in North Carolina. The depot recorded more than 4,200 shipments of parts to

replenish inventory and more than 2,600 repairs for parts removed from Smart &

Final stores—about seven percent of the repairs and replenishments performed for

all Toshiba customers. (See Glendenning Aff. ¶¶ 18–21.)

14. Less than a year into their relationship, the parties split. Toshiba alleges

that the equipment covered by the agreement failed at rates far higher than Smart

& Final predicted during negotiations, triggering hefty overage fees. (See Compl.

¶ 30, ECF No. 2.) As alleged, Smart & Final refused to pay and then terminated the

agreement without cause in April 2020, more than two years before its scheduled

expiration. (See Compl. ¶¶ 33, 46.) Toshiba sued for breach of contract and related

claims. (See Compl. ¶ 73.)

B. Conclusions of Law

15. Personal jurisdiction refers to the Court’s authority “to assert judicial power

over the parties and bind them by its adjudication.” Capitala Grp., 2018 NCBC

LEXIS 183, at *8 (citation and quotation marks omitted). The “primary focus” of the

personal jurisdiction inquiry “is the defendant’s relationship to the forum State.”

Bristol-Meyers Squibb Co. v. Superior Court, 137 S. Ct. 1773, 1779 (2017).
16. In North Carolina, determining whether personal jurisdiction exists is a

“two-step analysis.” Beem USA LLLP v. Grax Consulting LLC, 373 N.C. 297, 302,

838 S.E.2d 158, 161 (2020). Jurisdiction must be authorized by the State’s long-arm

statute, N.C.G.S. § 1-75.4, and consistent with the Due Process Clause of the

Fourteenth Amendment to the United States Constitution. See Beem USA, 373 N.C.

at 302, 838 S.E.2d at 161. In most cases, the analysis collapses into one inquiry

because the North Carolina Supreme Court has broadly construed the long-arm

statute “to make available to the North Carolina courts the full jurisdictional powers

permissible under federal due process.” Id. (citation and quotation marks omitted);

see also Cambridge Homes of N.C. LP v. Hyundai Constr., Inc., 194 N.C. App. 407,

412, 670 S.E.2d 290, 295 (2008); Filmar Racing, Inc. v. Stewart, 141 N.C. App. 668,

671, 541 S.E.2d 733, 736 (2001).

17. Nearly all the parties’ briefing deals with step two’s due process analysis.

(See Br. in Supp. 13–29, ECF No. 10; Opp’n 12–23, ECF No. 21; Reply Br. 2–14, ECF

No. 30.) But Smart & Final also challenges step one on the ground that the complaint

fails to meet threshold pleading requirements for statutory jurisdiction. (See Br. in

Supp. 10–12.) The Court begins with that argument.

1. Long-Arm Statute

18. The complaint does not refer to the long-arm statute or expressly allege

personal jurisdiction under any of its subsections. Smart & Final contends, as a

result, that Toshiba has not done enough to plead a statutory basis for jurisdiction,

obviating the need to consider due process limitations. (See Br. in Supp. 10–11.)
19. This argument overstates the pertinent pleading burden. Jurisdiction may

exist even when the plaintiff says nothing about the long-arm statute in the

complaint. See, e.g., N.C. Farm Bureau Mut. Ins. Co. v. Holt, 154 N.C. App. 156, 160,

574 S.E.2d 6, 9 (2002). “The failure to plead the particulars of jurisdiction is not fatal

to the claim so long as the facts alleged permit the inference of jurisdiction under the

statute.” Williams v. Inst. for Computational Stud. at Colo. State Univ., 85 N.C. App.

421, 428, 355 S.E.2d 177, 182 (1987).

20. In its response brief, Toshiba points to section 1-75.4(5), which broadly

confers jurisdiction on any action that

a. Arises out of a promise, made anywhere to the plaintiff . . . by the
defendant to perform services within this State or to pay for services to be
performed in this State by the plaintiff; or

b. Arises out of . . . services actually performed for the defendant by the
plaintiff within this State if such performance within this State was
authorized or ratified by the defendant; or

....

d. Relates to goods, documents of title, or other things of value shipped from
this State by the plaintiff to the defendant on his order or direction; or

e. Relates to goods, documents of title, or other things of value actually
received by the plaintiff in this State from the defendant through a carrier
without regard to where delivery to the carrier occurred.

N.C.G.S. § 1-75.4(5). The complaint alleges that Smart & Final solicited maintenance

and repair services from Toshiba, a North Carolina company. (See Compl. ¶¶ 1, 9.)

It also incorporates by reference the contract at issue, which describes the services

that Toshiba would perform. (See Compl. ¶ 13.) For pleading purposes, that is

enough to support an inference of jurisdiction under section 1-75.4(5). See Skinner v.
Preferred Credit, 361 N.C. 114, 120, 638 S.E.2d 203, 209 (2006) (“Essentially, this

section of the long-arm statute reaches defendants who engage in commercial

transactions with residents of this state.” (citation omitted)).

21. The remaining arguments relate to proof, rather than pleading. Smart &

Final contends that Toshiba has not carried its burden to prove statutory or

constitutional jurisdiction. Because the statutory arguments simply repeat the

constitutional arguments, (see Reply Br. 2), the Court turns to step two.

2. Due Process

22. The Due Process Clause requires that a defendant “have certain minimum

contacts” with this State “such that the maintenance of the suit does not offend

‘traditional notions of fair play and substantial justice.’ ” Int’l Shoe Co. v.

Washington, 326 U.S. 310, 316 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463

(1940)). Sometimes, a defendant’s contacts “are so continuous and systematic as to

render them essentially at home in the forum State.” Goodyear Dunlop Tires

Operations, S. A. v. Brown, 564 U.S. 915, 919 (2011) (citation and quotation marks

omitted). In that case, the courts of the forum State have general jurisdiction “to hear

any and all claims against” the defendant. Id. The parties agree that there is no

basis for general jurisdiction here. (See Br. in Supp. 13–14; Opp’n 12–14.)

23. More commonly, a “nonresident defendant has situational, rather than

systematic, contacts with the forum State.” Lunsford v. ViaOne Servs., LLC, 2020

NCBC LEXIS 127, at *9 (N.C. Super. Ct. Oct. 28, 2020). Jurisdiction in such cases

depends on the “relationship among the defendant, the forum, and the litigation.”
Daimler AG v. Bauman, 571 U.S. 117, 133 (2014) (citation and quotation marks

omitted); see also Beem USA, 373 N.C. at 303, 838 S.E.2d at 162. There must be a

nexus between the forum and the underlying controversy such that “the suit ‘arises

out of or relates to the defendant’s contacts with the forum.’ ” Goodyear, 564 U.S. at

923–24 (alterations omitted) (quoting Helicopteros Nacionales De Colombia, S. A. v.

Hall, 466 U.S. 408, 414 n.8 (1984)); see also Skinner, 361 N.C. at 122, 638 S.E.2d at

210. This is known as “specific or case-linked jurisdiction.” Goodyear, 564 U.S. at

919 (citation omitted).

24. The analysis for specific jurisdiction “looks to the defendant’s contacts with

the forum State itself, not the defendant’s contacts with persons who reside there.”

Walden v. Fiore, 571 U.S. 277, 285 (2014). Jurisdiction cannot be based on “a

defendant’s ‘random, fortuitous, or attenuated’ contacts with the forum state.” Beem

USA, 373 N.C. at 303, 838 S.E.2d at 162 (quoting Walden, 571 U.S. at 286). Rather,

there must be “some act by which the defendant purposefully avails itself of the

privilege of conducting activities within the forum State, thus invoking the benefits

and protections of its laws.” Hanson v. Denckla, 357 U.S. 235, 253 (1958) (citation

omitted). A “crucial factor” is foreseeability—that is, whether the defendant’s

contacts with the forum are such that it should “reasonably anticipate being haled

into court there.” Beem USA, 373 N.C. at 303, 838 S.E.2d at 162 (citations and

quotation marks omitted).

25. This test is met when the suit is based on a contract that “has a substantial

connection with this State.” Beem USA, 373 N.C. at 304, 838 S.E.2d at 163 (quoting
Tom Togs, Inc. v. Ben Elias Indus. Corp., 318 N.C. 361, 367, 348 S.E.2d 782, 786

(1986)); see also Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475 n.18 (1985);

McGee v. Int’l Life Ins. Co., 355 U.S. 220, 223 (1957). When a defendant “has created

continuing obligations between himself and residents of the forum, he manifestly has

availed himself of the privilege of conducting business there.” Burger King, 471 U.S.

at 476 (citation and quotation marks omitted). Put another way, the defendant’s

“activities are shielded by ‘the benefits and protections’ of the forum’s laws” such that

“it is presumptively not unreasonable to require him to submit to the burdens of

litigation in that forum as well.” Id. To determine whether a contract has a

substantial connection with a State, the Court must consider prior negotiations,

contemplated future consequences, the terms of the contract, and the parties’ actual

course of dealing. See id. at 479.

26. Weighing all the evidence, the Court concludes that the services agreement

has a substantial connection with North Carolina. Smart & Final initiated contact

with a resident of this State and created a continuing relationship involving services

that were performed both within and outside North Carolina. Accordingly, Smart &

Final has purposefully availed itself of the privilege of conducting business in North

Carolina.

27. To start, Smart & Final twice contacted Toshiba to solicit its services. This

is a “critical factor.” Cambridge Homes, 194 N.C. App. at 413, 670 S.E.2d at 296

(quoting Banc of Am. Sec. LLC v. Evergreen Int’l Aviation, Inc., 169 N.C. App. 690,

698, 611 S.E.2d 179, 185 (2005)). And for good reason. When a nonresident makes
first contact and solicits business from a forum resident, it tends to show purposeful

availment. 2

28. It makes little difference that Smart & Final contacted Toshiba employees

based elsewhere. That was true in Burger King too. There, the defendant (a

Michigander) first contacted Burger King (based in Florida) through its district office

in Michigan. 471 U.S. at 466. Even so, the Court held that the defendant

“deliberately ‘reached out beyond’ Michigan” and “most certainly knew that he was

affiliating himself with an enterprise based primarily in Florida.” Id. at 479, 480

(citation, alteration, and quotation marks omitted).

29. Smart & Final was well aware when it contacted representatives of Toshiba

that it was soliciting business from a North Carolina-based entity. The nondisclosure

agreement that preceded negotiations has Toshiba’s address right at the top. There

are also repeated references to North Carolina in Toshiba’s pitch materials and

proposal as well as in the services agreement itself, which requires all notices to go

2 This principle is a mainstay of North Carolina and federal precedent. See, e.g., Brown v.
Artisan 2510, Inc., No. COA13-868, 2014 N.C. App. LEXIS 292, at *9 (N.C. Ct. App. Mar. 18,
2014); Bryant v. AP Indus., No. COA12-1456, 2013 N.C. App. LEXIS 862, at *15–16 (N.C. Ct.
App. Aug. 20, 2013); Banc of Am. Sec., 169 N.C. App. at 698, 611 S.E.2d at 185; Inspirational
Network, Inc. v. Combs, 131 N.C. App. 231, 241, 506 S.E.2d 754, 761 (1998); Climatological
Consulting Corp. v. Trattner, 105 N.C. App. 669, 674, 414 S.E.2d 382, 384–85 (1992); CFA
Med., Inc. v. Burkhalter, 95 N.C. App. 391, 395, 383 S.E.2d 214, 216 (1989); see also, e.g.,
Universal Leather, LLC v. Koro AR, S.A., 773 F.3d 553, 562 (4th Cir. 2014) (collecting cases);
CFA Inst. v. Inst. of Chartered Fin. Analysts of India, 551 F.3d 285, 295 n.17 (4th Cir. 2009);
Madison Consulting Grp. v. South Carolina, 752 F.2d 1193, 1202–03 (7th Cir. 1985); CoStar
Realty Info., Inc. v. Field, 612 F. Supp. 2d 660, 671–72 (D. Md. 2009); Competitive Strategies
Grp., Ltd. v. IP Commc’ns Corp., No. 00-CV-0057, 2000 U.S. Dist. LEXIS 3198, at *7–8 (N.D.
Ill. Mar. 13, 2000); Salem Radio Representatives, Inc. v. Can Tel Mkt. Support Grp., No. 3:99-
CV-2048, 1999 U.S. Dist. LEXIS 17962, at *7 (N.D. Tex. Nov. 16, 1999); Berndorf Belt Sys.,
Inc. v. Ascona Food Grp. (Can.) Ltd., No. 98-C-1055, 1998 U.S. Dist. LEXIS 19141, at *22
(N.D. Ill. Dec. 3, 1998).
to Toshiba’s Durham headquarters. Furthermore, unlike the defendant in Burger

King, Smart & Final is a large, sophisticated company deeply familiar with the

market for point-of-sale products and services. (See White Aff. ¶¶ 3, 7, 13, 14, 16; 1st

Kumar Aff. ¶¶ 10–13.) At no point has Smart & Final claimed surprise to find that

Toshiba is based in North Carolina.

30. Indeed, the services that Smart & Final solicited were performed inside and

outside North Carolina. Smart & Final erroneously contends that “[n]othing in the

Agreement suggests that any work would be performed in North Carolina.” (Br. in

Supp. 21.) Naturally, all on-site repairs were expected to take place at stores in the

western United States. But the agreement also tasked Toshiba with maintaining

seed stock and handling shipping of parts to and from its repair depot. (See Servs.

Agrmt. Attach. C.) The price list, for example, was based in part on an assumption

that Toshiba would “image/configure units during the receive and repair process at

our Depot.” (Servs. Agrmt. Attach. A.) And for some replacement services, the

agreement called for a technician to “meet [the] part on-site that is shipped from the

Toshiba depot.” (Servs. Agrmt. Attach. A.) Context makes clear that these are

references to the repair depot at Toshiba’s North Carolina headquarters.

31. The parties’ course of performance confirms as much. In less than a year,

Toshiba recorded thousands of shipments from its North Carolina base to maintain

seed stock and replenish inventory, along with more than 2,600 repairs of parts taken

from Smart & Final stores. (See Glendenning Aff. ¶¶ 18–21.) This was not only a

substantial part of the services performed for Smart & Final but also an appreciable
part of the repair and replenishment services that Toshiba performed as a whole.

(See Glendenning Aff. ¶¶ 20, 21.)

32. Smart & Final responds that Toshiba could have handled offsite services

somewhere else. It also contends that parts removed from a store became Toshiba’s

property so that there were no shipments of Smart & Final property to or from North

Carolina. (See Reply Br. 13–14.) Neither argument is persuasive. Smart & Final

had the option to keep its seed stock in house so that Toshiba would be responsible

only for labor at affected stores. Instead, Smart & Final put the burden on Toshiba

to create and maintain the seed stock and to provide the infrastructure needed for

same-day and next-day services. The agreement—and the prices proposed by

Toshiba—assume that much of that work would take place at the depot in North

Carolina. Put simply, Smart & Final sought and bargained for comprehensive repair

and support services that required continuous and extensive coordination between

Toshiba’s technicians and its headquarters. It was foreseeable and expected that

Toshiba would perform a substantial part of the services at its facilities in this State.

33. Two other points bear mention. First, it is undisputed that Smart & Final

did not come to North Carolina or perform any services here. But “[j]urisdiction in

these circumstances may not be avoided merely because the defendant did not

physically enter the forum State.” Burger King, 471 U.S. at 476; see also Tom Togs,

318 N.C. at 368, 348 S.E.2d at 787 (“Defendant, however, argues strongly that

personal jurisdiction is improper because it took no action in North Carolina. Lack
of action by defendant in a jurisdiction is not now fatal to the exercise of long-arm

jurisdiction.” (citations omitted)).

34. Second, the agreement has a New York choice-of-law provision. This factor

does not favor the exercise of jurisdiction, but neither does it weigh strongly against

jurisdiction given that neither party is organized under New York law or based in

New York. See Tejal Vyas, LLC v. Carriage Park LP, 166 N.C. App. 34, 41, 600 S.E.2d

881, 887 (2004) (“[C]hoice of law clauses are not determinative of personal

jurisdiction . . . .”).

35. In short, Smart & Final initiated contact with Toshiba, a corporation based

in North Carolina. It bargained for substantial services to be performed inside North

Carolina, and Toshiba actually performed a substantial portion of its obligations in

the State. Accordingly, the Court concludes that Smart & Final’s “connections with

North Carolina relating to the contract satisf[y] the minimum contacts inquiry and

establish[ ] the existence of specific jurisdiction.” Beem USA, 373 N.C. at 304, 838

S.E.2d at 163 (citation omitted); see also Tom Togs, 318 N.C. at 368, 348 S.E.2d at

787; Nat’l Util. Rev., LLC v. Care Ctrs., Inc., 200 N.C. App. 301, 305, 683 S.E.2d 460,

464–65 (2009); Banc of Am. Sec., 169 N.C. App. at 696–701, 611 S.E.2d at 184–87;

Kath v. H.D.A. Ent., Inc., 120 N.C. App. 264, 266–67, 461 S.E.2d 778, 779–80 (1995).

36. Finally, in some rare cases, it may be unreasonable or inconvenient to

exercise jurisdiction even when the defendant has the requisite minimum contacts

with the forum. Smart & Final has not made that argument here. Thus, given the

agreement’s substantial relationship with this State, the Court may appropriately
exercise jurisdiction over Smart & Final without offending due process. See Burger

King, 471 U.S. at 487.

II.
CONCLUSION

37. For all these reasons, the Court DENIES Smart & Final’s motion to dismiss

for lack of personal jurisdiction.

38. Consistent with its September 18, 2020 Order, (ECF No. 17), the Court

ORDERS that the parties shall conduct their case management meeting no later

than January 4, 2021 and shall submit a joint case management report and proposed

case management order fifteen days thereafter. See Business Court Rules 9.1, 9.2.

In view of the intervening holidays, if additional time is needed, the parties may

request a reasonable extension.

SO ORDERED, this the 23rd day of December, 2020.

/s/ Adam M. Conrad
Adam M. Conrad
Special Superior Court Judge
for Complex Business Cases