No. 13-­--2300 BOUMATIC, LLC v. Idento Operations, Bv

In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 13-­‐‑2300
BOUMATIC, LLC,
Plaintiff-­‐‑Appellant,
v.
IDENTO OPERATIONS, BV,
Defendant-­‐‑Appellee.
____________________
Appeal from the United States District Court
for the Western District of Wisconsin.
No. 11-­‐‑cv-­‐‑822-­‐‑wmc — William M. Conley, Chief Judge.
____________________
ARGUED FEBRUARY 20, 2014 — DECIDED JULY 22, 2014
____________________
Before EASTERBROOK, MANION, and SYKES, Circuit Judges.
EASTERBROOK, Circuit Judge. Idento Operations, BV,
makes robotic milking machines in the Netherlands. Bou-­‐‑
Matic, LLC, which is based in Wisconsin, entered into an
agreement for purchasing and reselling those machines in
Belgium. BouMatic filed this suit under the international di-­‐‑
versity jurisdiction, 28 U.S.C. §1332(a)(2), contending that
Idento had broken its promises by selling direct to at least
one of BouMatic’s Belgian customers and by failing to pro-­‐‑

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2 No. 13-­‐‑2300
vide parts and warranty service. The district court dismissed
the suit, however, ruling that commercial transactions in the
European Union do not expose Idento to litigation in Wis-­‐‑
consin even though BouMatic has its headquarters there, the
parties exchanged drafts between Wisconsin and the Nether-­‐‑
lands, and Idento shipped one machine to Wisconsin.
Before turning to personal jurisdiction, we discuss sub-­‐‑
ject-­‐‑matter jurisdiction. BV stands for besloten vennootschap
met beperkte aansprakelijkheid, a label that the Netherlands ap-­‐‑
plies to closely held businesses whose shares are subject to a
restriction of some kind, such as a buy-­‐‑sell agreement that
prevents investors from selling to strangers without offering
them to the business first. Unless this is treated as a corpora-­‐‑
tion for the purpose of American law, we need to know the
citizenship of every equity investor. See Carden v. Arkoma As-­‐‑
sociates, 494 U.S. 185 (1990); Fellowes, Inc. v. Changzhou Xinrui
Fellowes Office Equipment Co., No. 12-­‐‑3124 (7th Cir. July 22,
2014). This can require tracing through several layers. See
Cosgrove v. Bartolotta, 150 F.3d 729 (7th Cir. 1998) (citizenship
of an LLC depends on citizenship of its members, traced
through as many levels as necessary to reach corporations or
natural persons). BouMatic, which is organized as an LLC,
has members in several states but not in the Netherlands. If
Idento is treated as a corporation, or if all of its direct and
indirect investors have citizenships outside the United
States, subject-­‐‑matter jurisdiction is established.
Classification of a foreign business entity can be difficult,
see, e.g., White Pearl Inversiones S.A. (Uruguay) v. Cemusa,
Inc., 647 F.3d 684 (7th Cir. 2011), because other nations may
use subsets of the characteristics that distinguish corpora-­‐‑
tions from other business entities in the United States. But

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No. 13-­‐‑2300 3
treatment of a Netherlands BV is straightforward. A BV has
the standard elements of “personhood” (perpetual existence,
the right to contract and do business in its own name, and
the right to sue and be sued) and issues shares to investors
who enjoy limited liability (which is to say, are not liable for
the business’s debts). Shares can be bought and sold, subject
to restrictions that the business declares. That is a common
device in this nation’s close corporations too. We held in
Hoagland v. Sandberg, Phoenix & von Gontard, P.C., 385 F.3d
737 (7th Cir. 2004), that a professional corporation, in which
only a few lawyers can invest, is a “corporation” for the
purpose of §1332. It follows that other close corporations,
including the Netherlands BV, satisfy that standard.
Now for personal jurisdiction, which per Fed. R. Civ. P.
4(k)(1)(A) depends on Wisconsin law. In contract cases (of
which this is one), Wisconsin provides for jurisdiction over
persons who perform services or sell goods in Wisconsin.
Wis. Stat. §801.05(5)(a), (c). Neither of these provisions ap-­‐‑
plies to Idento, for the dispute does not concern the single
machine it delivered to Wisconsin. The dispute concerns
Idento’s provision of goods and services in Belgium. Wis-­‐‑
consin does not authorize personal jurisdiction just because
one of the contracting parties operates in Wisconsin. This
leaves only one possibility: that Idento has consented to be
sued in Wisconsin, which treats consent as a valid extra-­‐‑
statutory basis of personal jurisdiction. Kohler Co. v. Wixen,
204 Wis. 2d 327, 336 (Ct. App. 1996).
BouMatic contends that, before executing a written con-­‐‑
tract, the parties agreed orally that any dispute could be re-­‐‑
solved in Wisconsin. The written agreement does not have a
forum-­‐‑selection clause or a choice-­‐‑of-­‐‑law clause, but neither

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4 No. 13-­‐‑2300
does it have an integration clause or otherwise demonstrate
that the writing represents the parties’ sole agreement. To
the contrary, ¶13 of the contract contemplates additional
terms from other sources. This means that terms orally
agreed survive the signed writing. Idento contends that it
did not orally agree to litigate in Wisconsin. This appears to
set the stage for a hearing under Fed. R. Civ. P. 12(b)(2), (i) to
determine whose version of events is correct. But the district
court thought a hearing unnecessary in light of forms the
parties exchanged after signing their principal contract.
Paragraph 13 of the main contract provides that addi-­‐‑
tional terms will come from the purchase orders and invoic-­‐‑
es that the parties exchange for particular machines. When
ordering machines, BouMatic sent purchase orders that in-­‐‑
corporated a clause specifying that litigation would occur in
Wisconsin under Wisconsin’s law of contracts. For its part,
Idento sent invoices containing a clause specifying that liti-­‐‑
gation would occur in the Netherlands under its substantive
law. Inconsistencies in commercial forms bring the situation
within the scope of the Uniform Commercial Code’s battle-­‐‑
of-­‐‑the-­‐‑forms provision, §2–207, which Wisconsin has enacted
verbatim as Wis. Stat. 402.207. (We use Wisconsin law provi-­‐‑
sionally here, because neither side contends that Nether-­‐‑
lands law governs this part of their dispute. Our provisional
use of Wisconsin law does not imply that Wisconsin pro-­‐‑
vides the rules that govern the substance of this dispute,
should personal jurisdiction be established.)
Section 2–207(2) treats a form such as BouMatic’s (or
Idento’s) as a proposal for additions to the contract and
states that between merchants (which BouMatic and Idento
are) these terms become part of the contract unless “the offer

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No. 13-­‐‑2300 5
expressly limits acceptance to the terms of the offer” (§2–
207(2)(a)). BouMatic’s purchase orders incorporate such a
restriction; each says that the transactions must be on its
terms and no others. When Idento replied with different
terms, the purchase orders and invoices canceled each other
out. This means that neither the purchase orders nor the in-­‐‑
voices vary the terms of the preexisting contract.
The district court inferred from this that the only terms in
force between the parties are those in the master contract. As
that contract does not specify where litigation will occur,
Idento has not consented to suit in Wisconsin. The problem
with that approach is that the inconsistent purchase-­‐‑and-­‐‑sale
forms countermand each other; they leave the parties’ prior
agreements unaffected. It takes a new agreement to knock
out an old one, and the inconsistent forms mean that there
has not been a new agreement. If the parties’ prior agree-­‐‑
ments include consent to litigate in Wisconsin, then this suit
can proceed.
BouMatic contends that a hearing is unnecessary because
its form is the only one in the record. If Idento neglected to
introduce its forms, then the record is one-­‐‑sided and Bou-­‐‑
Matic’s proposals (including consent to suit in Wisconsin)
became part of the contract. But BouMatic is mistaken; the
record has several copies of Idento’s terms, which its invoic-­‐‑
es (also in the record) incorporate. And the district court
added (footnote 1 of its opinion) that BouMatic has waived
any contention that Idento did not send sets of terms incom-­‐‑
patible with BouMatic’s own.
According to Idento, if it agreed orally to anything
(which it denies) it specified Wisconsin as a forum but did
not agree to personal jurisdiction. That makes no sense. A

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6 No. 13-­‐‑2300
forum-­‐‑selection clause can work only if both parties are
amenable to suit in the chosen forum; to agree to a forum
thus is to agree to personal jurisdiction in that forum. Heller
Financial, Inc. v. Midwhey Powder Co., 883 F.2d 1286, 1292 n.4
(7th Cir. 1989).
Finally, Idento asserts that it would violate the Due Pro-­‐‑
cess Clause of the Fifth Amendment to base personal juris-­‐‑
diction on consent. That is nonsense. The Supreme Court has
stated that personal jurisdiction can rest on consent. See, e.g.,
Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 n.14 (1985);
see also Heller Financial, 883 F.2d at 1290. Cf. Atlantic Marine
Construction Co. v. United States District Court, 134 S. Ct. 568
(2013). Indeed, an argument that personal jurisdiction is
missing can be forfeited by delay in moving to dismiss. Fed.
R. Civ. P. 12(h)(1).
Litigants cannot confer subject-­‐‑matter jurisdiction by
agreement or omission, but personal jurisdiction is a person-­‐‑
al right that a litigant may waive or forfeit. Idento maintains
that only “freely negotiated” forum selection clauses can be
enforced. Put to one side the fact that the Supreme Court has
enforced a clause preprinted in tiny type on the back of a
cruise ticket and not “negotiated” at all. Carnival Cruise Lines,
Inc. v. Shute, 499 U.S. 585 (1991). Nor is personal jurisdiction
achieved when the defendant forfeits its objection “freely
negotiated.” At all events, Idento does not contend that any-­‐‑
one twisted its (corporate) arm. If it agreed with BouMatic
on a Wisconsin forum, in a manner compatible with contract
(i.e., without fraud), no more is necessary.
A few additional arguments have been considered but do
not require discussion.

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No. 13-­‐‑2300 7
There is no shortcut; a hearing is essential. The judgment
is vacated, and the case is remanded for proceedings con-­‐‑
sistent with this opinion.

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