Eighth Circuit Vacates Confirmation Over Lack of Personal Jurisdiction
The Eighth Circuit recently vacated a judgment confirming an arbitration award after concluding that the district court lacked personal jurisdiction over the defendant.
Federated Mutual Insurance Co., a Minnesota insurer, owns various trademarks containing the word “Federated.” A Florida insurer changed its name to Federated National Holding Co. After Federated Mutual expressed concern about possible confusion related to its marks, the insurers entered into an agreement requiring Federated National to adopt a new name, inform Federated Mutual of its new name, and provide Federated Mutual with an opportunity to object. Federated National adopted the name “FedNat,” continued to use the name Federated National as well, and failed to give Federated Mutual the required notice and opportunity to object. Federated Mutual initiated arbitration.
The arbitrator allowed FedNat to continue using FedNat, but ordered it to stop using “Federated.” Federated Mutual filed a petition to confirm the award in the U.S. District Court for the District of Minnesota. Federated Mutual’s petition was successful.
FedNat appealed, and the Eighth Circuit vacated the award and remanded with instructions to dismiss the petition based on a lack of personal jurisdiction over FedNat. It ruled that the agreement between the parties, despite being relevant, did not give rise to personal jurisdiction merely because the agreement contained a Minnesota choice-of-law provision. The court also explained that FedNat had no meaningful connection to Minnesota: It did not do business or have a physical presence there, and the fact that FedNat’s name disrupted Federated Mutual’s business in Minnesota did not create contacts on the part of FedNat with Minnesota. Finally, the panel disagreed with the district court’s conclusion that the agreement between the parties contemplated regular communications in Minnesota. The agreement only required notice of Federated National’s new name and was silent as to where the notice was to be given. Such sporadic communications were not enough to establish personal jurisdiction in Minnesota.
Federated Mut. Ins. Co. v. FedNat Holding Co., No. 18-2430 (8th Cir. June 27, 2019).