United States District Court, S.D. Ohio, Western Division
ORDER GRANTING DEFENDANT'S MOTION TO DISMISS FOR
LACK OF PERSONAL JURISDICTION (Doc. 5)
Timothy S. Black United States District Judge
civil action is before the Court on Defendant The Boeing
Company's motion to dismiss for lack of personal
jurisdiction (Doc. 5) and the parties' responsive
memoranda (Docs. 16 and 23).
FACTS AS ALLEGED BY THE PLAINTIFFS
purposes of this motion to dismiss, the Court must: (1) view
the complaint in the light most favorable to Plaintiffs; and
(2) take all well-pleaded factual allegations as true.
Tackett v. M&G Polymers, 561 F.3d 478, 488 (6th
The Field Entities
April 2012, an Ohio corporation named AVAMCO was formed to
acquire two companies: Field Aviation, Inc. (“FAI,
” an Ohio Corporation) and Field Aviation Company,
Inc., (“FACI, ” a Canadian entity). (Doc. 16, Ex. 1
at ¶ 3). AVAMCO later changed its name to Field
Aerospace, Inc. (Id. at ¶ 4). The Field family
of companies specializes in aircraft modification.
(Id. at ¶ 6). Dan Magarian has at all times
served as Chairman of Field Aerospace and its predecessor
AVAMCO, based out of Cincinnati, Ohio. (Id. at
The relationship between Boeing and the Field
spring 2012, Boeing “cold called” FAI's Ohio
office, seeking a strategic partner for its mid-market
intelligence, surveillance, and reconnaissance/maritime
surveillance aircraft program (“MSA program”).
(Doc. 16-1 at ¶ 7). Shortly after that call, Boeing
presented a program pitch to Field's Ohio-based Chairman
(Magarian) as well as to other Field executives. (Doc. 16-1
at ¶ 8). Field and Boeing discussed Field providing
proprietary engineering and modification services for the MSA
program, beginning with one prototype aircraft: the MSA
Demonstrator. (Doc. 16-1 at ¶ 12; Doc. 1-1 at ¶ 8).
Boeing's initial presentation, Field informed Boeing of
Field's plans to build an Aviation Center of Excellence
in Ohio. In internal emails immediately after that pitch,
Boeing executives described the possibility of a Field
facility in Ohio as “[t]oo good to be true, ” and
“in the right location.” (Doc. 16-2, Ex. A).
sent Boeing a follow-up letter on June 29, 2012 on FAI
letterhead, listing a Cincinnati, Ohio, address, to express
Field's interest in partnering with Boeing. (Doc. 16-1 at
¶ 10; Ex. A). A week later, Field's Contract
Manager, David MacNeil, sent a Budgetary Letter to Boeing,
providing a rough pricing estimate for the MSA Demonstrator
project. MacNeil's letter, and an attached summary and
support letter from Magarian, were sent on FAI letterhead
that listed a Cincinnati, Ohio, address. (Id. at
¶ 11; Exs. B, C). Over the following several months,
Magarian, MacNeil, and Brian Love were the principal
negotiators and decision-makers for Field in connection with
the MSA program. (Id. at ¶ 13).
result of the negotiations, Boeing knew that Field was
seeking to build or lease a production facility in Ohio in
order to perform modification work once the MSA program
entered the production phase. In August 2012, Magarian met with
Steve Teske, a Field Marketing Director in Boeing's
Dayton-area office, at a trade event in the Dayton area.
(Doc. 16-1 at ¶ 21). Magarian reported that meeting to
Boeing's Project Manager for the MSA project, Doug
Ilgenfritz. (Id. at ¶ 22). Ilgenfritz then
briefed Teske on Field's role in the MSA program and
efforts to locate a facility in Ohio so that Teske would
“have more detail and awareness” regarding the
project. (Id.; Ex. E). Boeing offered to make Teske
available to assist Field in its efforts to secure an Ohio
production facility. (Id. at ¶ 23).
the project negotiations, Field sought to secure a long-term
role as a supplier for Boeing and to gain some certainty on
the scope of its work. (Doc. 16-1 at ¶ 14). On September
21, 2012, John Mackiewicz, the Boeing supplier manager who
supported the MSA program, initiated a phone call with
Magarian to discuss a commitment from Boeing to make Field
its exclusive supplier for up to 30 MSA aircraft, as well as
a process for how the parties would address changes to the
scope of work on (and therefore the cost of) the MSA
Demonstrator. (Id. at ¶ 25; Ex. F). Mackiewicz
sent a summary of that conversation, including the
parties' respective positions on those terms, to Magarian
(who was based in Ohio). (Id.) Magarian sent a
response providing a detailed summary of Field's
negotiating position. (Id.) Among other things,
Magarian recommended that the parties press forward with a
term sheet for a future production contract while they
negotiated and executed the MSA Demonstrator Purchase
Contract (“Purchase Contract”). (Id.)
production contract contemplated that Field would be
Boeing's exclusive supplier for the first ten MSA
aircraft and-provided that Field met certain quality and
production capacity requirements-the next 20 as well. (Doc.
1-1 at ¶¶ 18-20). Although the production contract
was never signed, Field undertook extensive efforts to locate
a site for a production facility in Ohio. (Doc. 16-1 at
¶ 16). Those efforts included working with Governor
Kasich, Senator Portman, and several local government
officials; securing incentives from Jobs Ohio (a non-profit
corporation designed to stimulate job creation in Ohio); and
securing substantial incentives from Butler County and the
City of Fairfield to expand the Butler County Airport.
(Id. at ¶¶ 17-18). Magarian discussed many
of these efforts at length with Ilgenfritz. (Id. at
¶ 19-20; Ex. D). Magarian advised Ilgenfritz that Jobs
Ohio incentives would be available to fund the Ohio
production facility. (Id. at ¶ 20). Ilgenfritz
said that a facility in Ohio would be interesting and
advantageous. (Id. at ¶ 19, Ex. D). Boeing
encouraged and promised to support Field's efforts, and,
among other things, offered to make Teske-an Ohio based
employee- available to help. (Id. at ¶¶
October 2, 2012, Magarian sent an email to Mackiewicz on
Field Aviation letterhead, showing Field's Ohio address,
asking about Boeing's progress on putting a contract
together. Mackiewicz responded that Boeing was updating the
statement of work for the MSA Demonstrator project, and
planned to issue a final Request for Proposal later that
week. (Doc. 16-1 at ¶ 26; Ex. G). He added that Magarian
“should not see any surprises based on the level of
coordination we have been going through between the
teams.” (Id.) Mackiewicz concluded by
promising to keep Magarian posted. (Id.)
three weeks later, Magarian sent Ilgenfritz an email from
Ohio with an agenda for their meeting in Seattle later that
week. (Doc. 16-1 at ¶ 27; Ex. H). Among other things,
Magarian wanted to discuss “finaliz[ing] open items on
the . . . Demonstrator, ” “[m]ov[ing] forward
with executing” the parties' contract, the scope of
work on the Demonstrator, the term sheet for a future
production contract, press releases for the Demonstrator
project, and Field's role in marketing the MSA project.
(Doc. 16-1 at ¶ 27; Ex. H). Ilgenfritz confirmed that
those were all planned topics of discussion. (Id.)
In November 2012, Boeing invited Magarian and others to come
to Seattle to sign the MSA Demonstrator Purchase Contract.
(Id. at ¶ 28; Ex. I).
The Purchase Contract between Boeing and FACI
December 4, 2012, Boeing and FACI executed the Purchase
Contract. (Doc. 1-1 at ¶ 9; Doc. 9). The Purchase
Contract incorporates a “term sheet” for a future
production contract. (Doc. 9 at 68). The term sheet states,
in relevant part:
Given the uncertainties associated with the Demonstrator
Aircraft effort and the parties' shared desire to
expedite negotiations associated with the follow-on
production contract, the parties have agreed to proceed with
collaboration on the Demonstrator Aircraft prior to
completing negotiations on a long-term production contract
(“Production Contract”) pursuant to which Boeing
intends to purchase from Field Aviation modifications to new
or used Challenger 604/605 aircraft for maritime surveillance
missions (as modified for such missions, the aircraft are
referred to as “MSA”). As soon as practical, the
parties agree to negotiate in good faith on the terms of a
Production Contract, which will include the key terms set
forth below. The parties intend to sign the Production
Contract at the conclusion of the Demonstrator Aircraft
effort (or such earlier time as mutually agreed by the
2013, Magarian and three others from Field participated in an
MSA program review with Boeing. (Doc. 1-1 at ¶ 29).
During that review, Magarian discussed Field's efforts to
open a facility in Ohio for the production phase of the MSA
program. (Id.) Boeing was pleased with that
development. (Id.) However, the parties ultimately
never entered into a production contract.
Boeing's termination of the Purchase Contract
mid-2016, Boeing stopped soliciting orders for MSA aircraft.
(Doc.1-1 at ¶ 28). In or around September 2016, Boeing
indicated to Field that Boeing was no longer actively
marketing the MSA program, and that Boeing would decline any
opportunity to sell an MSA. (Id. at ¶ 30). On
or about October 11, 2016, Boeing indicated that it
terminated the MSA program and transferred the MSA
Demonstrator to another division of Boeing for an alternate
use, allegedly in breach of the Purchase Contract.
(Id. at ¶ 31). On November 1, 2016, Boeing
confirmed that it terminated the Purchase Contract effective
October 25, 2016, and informed Field that Boeing would not
sell an MSA to customers in the future. (Id. at
¶¶ 32-33). Boeing also informed Field that Boeing
had transferred the MSA Demonstrator to “Phantom Works,
” a different division of Boeing, in order to allow
Boeing to use the MSA Demonstrator for other projects.
(Id. at ¶ 34).
November 7, 2016, Field submitted a proposed termination
settlement of $7, 126, 280, representing the value of the MSA
Demonstrator ($6, 478, 600), plus the value of all
Boeing-approved changes ($647, 680). (Doc. 1-1 at ¶ 36).
Boeing did not pay the proposed settlement amount.
(Id. at ¶¶ 37-38). Field claims Boeing is
using the MSA Demonstrator to explore non-MSA projects.
(Id. at ¶ 40). To date, Boeing has not paid
Field for its ...