Background
De Simone, an Italian citizen domiciled in Switzerland, developed a probiotic formulation for gastrointestinal illness. In 2008, he entered into an agreement with Danisco USA (a subsidiary of International Flavors & Fragrances Inc. with operations in Madison, Wisconsin) permitting it to blend, ship, and sell the formulation to designated buyers, including Mendes, a Swiss company.
De Simone also entered into a direct licensing agreement with Mendes in 2018. By 2023, their relationship deteriorated over unpaid royalties and related disputes. De Simone alleged that he removed Mendes from the approved buyers list in late 2023, whereupon Mendes’s principal, Salvatore Orlando, contacted Danisco USA directly and pressured it to continue selling the formulation to Mendes. De Simone then sued Mendes in Dane County, Wisconsin, seeking declaratory and injunctive relief and alleging tortious interference with contract.
Mendes moved to dismiss for lack of personal jurisdiction, arguing it had no Wisconsin presence and its ordering relationship was with Danisco Italy, not Danisco USA. De Simone opposed the motion and requested jurisdictional discovery. The circuit court granted Mendes’s motion and denied discovery.
The Court’s Holding
The Court of Appeals affirmed the dismissal, holding that De Simone failed to establish personal jurisdiction over Mendes under Wisconsin’s long-arm statute, specifically WIS. STAT. § 801.05(3), which permits jurisdiction based on “an act or omission within this state by the defendant.” The court concluded De Simone’s pleadings did not identify any communication by Mendes to a Wisconsin recipient, nor did they allege that Mendes was in Wisconsin when communicating about the disputed matters.
The court rejected De Simone’s argument that Danisco USA’s Madison location and Orlando’s knowledge of its role in production and supply satisfied the statutory requirement. The court distinguished knowledge that foreign conduct will affect a Wisconsin facility from actually committing an act or omission within Wisconsin. It emphasized that Wisconsin’s long-arm statute focuses on the defendant’s conduct, not the third party’s role in the supply chain or the effects of the defendant’s actions on Wisconsin businesses.
Regarding De Simone’s request for jurisdictional discovery, the court held the circuit court reasonably denied it because the proposed discovery—aimed at establishing Danisco USA’s control over production and Mendes’s knowledge thereof—would not alter the statutory analysis. Knowledge of an effect in Wisconsin is distinct from conducting activities in Wisconsin.
Key Takeaways
- Wisconsin’s long-arm statute § 801.05(3) requires that the defendant commit an “act or omission” within Wisconsin; knowledge that conduct will affect a Wisconsin business or facility is insufficient to establish jurisdiction.
- Communications directed at a non-Wisconsin location do not support personal jurisdiction, even if sent regarding a Wisconsin-based entity or its operations.
- Jurisdictional discovery will not be granted when proposed discovery would not materially affect the statutory analysis required for establishing personal jurisdiction.
Why It Matters
This decision provides important guidance for international commercial disputes involving Wisconsin-based entities. It establishes that parties cannot rely on Wisconsin’s long-arm statute to secure jurisdiction simply because the opposing party’s conduct affects a Wisconsin business partner or supplier. The statute requires actual conduct within Wisconsin, not merely effects or connections to the state. This strict interpretation protects non-resident defendants from being hauled into Wisconsin courts solely because their contractual counterparty maintains Wisconsin operations.
For businesses engaged in supply chain arrangements, the decision underscores that third-party relationships will not create personal jurisdiction over foreign defendants. Companies with Wisconsin operations cannot bootstrap jurisdiction over foreign suppliers or customers merely by being part of a supply chain centered in Wisconsin.