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BLW 3013.003
Professor Sandoval
September 23, 2008 (Due date)

Cole v. Mileti

FACTS: Nick Mileti, a California resident, entered into a contract arranged through
phone calls and correspondence with Joseph Cole, a resident of Ohio, to repay a
$475,000 loan that Cole made to Mileti’s distribution company, Streamers International
Distributors, Inc. When Mileti failed to repay the loan, Cole filed a suit against Mileti in a
federal district court in Ohio. The court entered a judgment against Mileti who then
appealed to the U.S. Court of Appeals for the Sixth Circuit, arguing in part that the
district court’s exercise of jurisdiction over him was unfair.

ISSUE: Whether or not phone calls and letters constituted sufficient minimum contacts
to give a court jurisdiction over a nonresident defendant?

LAW: Specific jurisdiction exists over a nonresident defendant when the following three
events occur: First, the defendant must purposely avail himself of the privilege of
conducting activities within the forum state [the state in which the court sits], second, the
cause of action must arise from the defendant’s activities within the forum state and
third, the acts of the defendant or consequences caused by the defendant must have a
substantial enough connection with the forum state to make its exercise of jurisdiction
over the defendant fundamentally fair.

RATIONALE: Mileti has purposely availed himself of the forum by creating a

continuing obligation in Ohio as is evident from his transacting business—that is,
negotiating and executing a contract via telephone calls and letters to Cole. In refusing to
pay the loan, as promised, Mileti’s breach of the contract and activities has brought about
a cause of action by Cole within the forum state. The activities of the defendant which
were caused by the defendant had a connection with the forum state. Therefore, Mileti’s
activities—forming a contract via telephone calls and letters—provide a “substantial
enough connection with the forum state to make its exercise of jurisdiction over the
defendant fundamentally fair.”

HOLDING: District court can exercise personal jurisdiction over Mileti. Mileti loses on
appeal.