Allan Block Corporation v. Shoreline Stone Manufacturing Carib

Background

Allan Block Corporation, alleged to be incorporated in and headquartered in Minnesota, designs proprietary interlocking concrete retaining-wall blocks featuring a raised lip and notch system that allows stacking without mortar. In 2018, the Stells—Joann and Jason, a married couple—approached Allan Block's president about becoming a licensed producer of its blocks in Florida. The pre-contract process included a trip by both Stells to Minnesota in July 2018 to attend Allan Block University training and to meet with an industrial equipment company called Besser. Jason Stell made an additional Minnesota visit in December 2018.

On November 9, 2018, Allan Block and Shoreline Stone Manufacturing Carib, Inc. (a Florida corporation of which Joann Stell was the sole shareholder) entered into the Allan Block Corporation Production Agreement. The Agreement gave Shoreline an exclusive license to manufacture Allan Block blocks in Florida, required Shoreline to pay royalties and submit regular accounting to Allan Block in Minnesota, mandated compliance with Allan Block's production and quality-control standards, and included a confidentiality obligation that survived termination. The Agreement also contained a Minnesota choice-of-law clause and a minimum three-year term. Allan Block provided Shoreline with detailed confidential technical information needed to manufacture the blocks.

Claims

Allan Block filed nine claims in its Amended Complaint: (1) breach of contract against Shoreline; (2) conversion against Shoreline; (3) aiding and abetting conversion against the Stells and Shoreloc; (4) civil theft under Minnesota Statutes § 604.14 against Shoreline; (5) aiding and abetting civil theft against the Stells and Shoreloc; (6) receiving stolen property under Minnesota Statutes § 609.53 against all defendants; (7) civil conspiracy against all defendants; (8) unjust enrichment against all defendants; and (9) unfair competition against all defendants.

Legal Standard

All four defendants jointly moved to dismiss under Federal Rule of Civil Procedure 12(b)(2) for lack of personal jurisdiction—the constitutional requirement that a court have sufficient legal authority over a particular defendant to adjudicate claims against them. Because both sides submitted declarations and other evidence, the court treated the motion as equivalent to a summary judgment motion, viewing the facts in the light most favorable to Allan Block. The plaintiff bears the burden of demonstrating personal jurisdiction. Minnesota's long-arm statute (Minn. Stat. § 543.19) extends to the full reach of constitutional due process, so the only question was whether each defendant had sufficient "minimum contacts" with Minnesota such that exercising jurisdiction would not offend "traditional notions of fair play and substantial justice." The Eighth Circuit uses five factors: (1) nature and quality of contacts; (2) quantity of contacts; (3) relationship between contacts and the claims; (4) the state's interest in providing a forum; and (5) convenience of the parties. Personal jurisdiction must be established individually for each defendant.

Ruling as to Shoreline

Judge Tostrud denied the motion as to Shoreline. Although a contract with a forum-state plaintiff is not alone enough to establish jurisdiction, the court found that Shoreline's Agreement with Allan Block created substantial, ongoing Minnesota-connected obligations: regular payments and reporting to Minnesota, receipt of all technical information from Minnesota, a minimum three-year term, surviving post-termination obligations (including the confidentiality provision still in force), and a Minnesota choice-of-law clause. Drawing on Burger King Corp. v. Rudzewicz, the court concluded that Shoreline's voluntary acceptance of long-term, exacting regulation from a Minnesota headquarters made its relationship with Minnesota non-random and non-fortuitous. The claims in this case—centered on breach of the Agreement—arose directly out of those Minnesota contacts. A reasonable fact-finder could therefore find personal jurisdiction over Shoreline in Minnesota.

Ruling as to the Stells

The motion was granted without prejudice as to Jason Stell and Joann Stell. Neither was a party to the Agreement; one signed it on Shoreline's behalf but that did not bind them personally. Their Minnesota contacts consisted of a few training visits (Joann once, Jason twice) and some emails—both on Shoreline's behalf to Allan Block and on Shoreloc's behalf to Minnesota companies. The training visits were brief and unrelated to the core claims (misappropriation of confidential information). The emails were insufficient in number and unconnected enough to the underlying claims that no reasonable juror could find personal jurisdiction. The court also noted that over 150 emails were referenced in a declaration but without description of their content or attribution between the two Stells, so their significance could not be assessed.

Ruling as to Shoreloc

The motion was also granted without prejudice as to Shoreloc. Shoreloc was not formed until after the Agreement was terminated and Shoreline was dissolved. Its Minnesota contacts were fewer than five solicitation emails sent in 2024 to two Minnesota companies (Amcon and TCC Materials). The emails solicited business but showed no completed transactions and no enduring relationships. This was insufficient in nature, quality, and quantity to support personal jurisdiction.

Rejection of Alternative Jurisdictional Theories

Calder Effects Test

Allan Block argued that the Calder effects test—applied in intentional-tort cases—provided an additional basis for jurisdiction over the Stells and Shoreloc. Under this doctrine, jurisdiction may exist if: (1) the defendant's acts were intentional; (2) the acts were uniquely or expressly aimed at the forum state; and (3) the defendant knew the harm would be suffered there. The Eighth Circuit construes this test narrowly. The court found the second element unsatisfied: Allan Block did not show the Stells or Shoreloc deliberately created contacts with Minnesota itself (rather than merely with a plaintiff who resides there). The alleged knock-off activity was not limited to Minnesota, and mere knowledge that a Minnesota company would be harmed by out-of-state conduct is insufficient under Walden v. Fiore.

Conspiracy-Based Jurisdiction

Allan Block also argued that Shoreline's Minnesota contacts should be imputed to the Stells and Shoreloc under a conspiracy theory of personal jurisdiction—the idea that co-conspirators act as each other's agents, so one defendant's forum contacts can establish jurisdiction over all. Conspiracy-based jurisdiction requires: (1) existence of a conspiracy; (2) the nonresident's participation or agreement to join it; and (3) an overt act in furtherance of the conspiracy within the forum. The court rejected this theory. The Amended Complaint contained only a single conclusory paragraph asserting that defendants "conspired," with no supporting factual allegations. Additionally, Shoreline was dissolved in 2021, making it implausible as a conspirator in conduct beginning in 2022. And even if a conspiracy existed, Shoreline's Minnesota contacts arose from the 2018 Agreement—not from any subsequent conspiracy—so those contacts could not be attributed to the Stells or Shoreloc on a conspiracy theory anyway.

Disposition

The court granted in part and denied in part Defendants' Joint Motion to Dismiss. The motion was granted without prejudice as to Shoreloc Design Group Inc., Jason Stell, and Joann Stell. The motion was denied as to Shoreline Stone Manufacturing Carib, Inc., which remains a defendant in the case.