Snap Fitness, Inc., Respondent,

This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (201 8).

STATE OF MINNESOTA
IN COURT OF APPEALS
A19-1415

Snap Fitness, Inc.,
Respondent,

vs.

Garrett Marshall,
Defendant,

Xponential Fitness, LLC,
Appellant.

Filed April 27, 2020
Reversed
Segal, Judge

Carver County District Court
File No. 10-CV-19-343

Holly M. Robbins, Jessica J. Bradley, Lauren Clements, Littler Mendelson, P.C.,
Minneapolis, Minnesota (for respondent)

Barbara Jean D’Aquila, Margaret Rudolph, Norton Rose Fulbright US LLP, Minneapo lis,
Minnesota; and

Randall C. Smith (pro hac vice), Orrick, Herrington & Sutcliffe LLP, Washington, D.C.
(for appellant)

Considered and decided by Cochran, Presiding Judge; Ross, Judge; and Segal,
Judge.

2
U N P U B L I S H E D O P I N I O N
SEGAL, Judge
Appellant, an out -of-state business, challenges the district court’s denial of its
motion to dismiss respondent’s complaint for lack of personal jurisdiction and improper
service of process. Because we conclude that the evidence in the record is not sufficient to
support a finding of personal jurisdiction over appellant, we reverse.
FACTS
Respondent Snap Fitness, Inc. is a Delaware corporation with its headquarters based
in Minnesota. Snap is a parent company and owns multiple fitness brands and franchises
that operate throughout t he United States and globally.
Garrett Marshall began working for Snap in 2011 as a product sales representative .
He held a variety of positions in Snap’s fitness on demand division during his employment.
That division sells touchscreen kiosks to business customers, such as fitness clubs, schools
and hotels. The kiosks provide access to v irtual fitness classes on demand . In 2014,
Marshall signed a non-qualified stock -option award agreement that included noncompete,
nonsolicitation and confidentiality provisions (noncompete agreement). Three years later,
in 2017, Marshall was promoted to the position of chief executive officer of the fitness on
demand division. Throughout his employment with Snap, Marshall was a Minneso ta
resident.
Appellant Xponential Fitness, LLC is also a Delaware corporation with its princip le
place of business in California. Xponential owns a portfolio of fitness studio subsidiary
corporations. The subsidiaries sell franchises to individual owners who open and operate

3
the branded fitness studio s across the country. Xponential has subsidiaries with fitness
studio franchises that operate in Minnesota. Those subsidiaries are registered to do
business in Minnesota. Xponential is not so registered.
In the spring of 2019, Xponential hired Marshall to be head of consumer streaming.
In support of its motion to dismiss for lack of personal jurisdiction and insufficient service
of process, Xponential provided an affidavit (Xponential affidavit) stating that it had
engaged a California-based recruiting company to place Marshall. The affidavit further
provided that Xponential interviewed Marshall at its Irvine, California office, and none of
Xponential’s employees traveled to Minnesota to recruit, interview, or discuss the terms of
Marshall’s employment. No additional evidence is contained in the record about the
recruitment or hiring process.
On April 1, 2019, M arshall informed Snap that he was resigning to work for
Xponential in California. Snap’s chief operations officer requested Marshall provide him
with a copy of the job description for his new position. Following a review of the job
description, Snap placed Marshall on leave and advised him that his employment by
Xponential would violate his noncompete agreement.
Two weeks before Marshall started his employment with Xponential, Snap served
Marshall with a complaint and a motion for a temporary injunction seeking to prevent his
employment with Xponential. Marshall, nevertheless, began his employment with
Xponential as scheduled on April 29. On May 1, Snap served and filed an amended
complaint that sought to add Xponential as a party , claiming to rtious interference with
Marshall’s noncompete agreement with Snap. The district court denied Snap’s motion for

4
a temporary injunction to restrain Marshall from working for Xponential.1 Xponential then
moved to dismiss Snap’s first amended complaint for lack of personal jurisdiction and
insufficient service of process.
In support of its motion, Xponential submitted an affidavit asserting that Xponential
does not have, nor has it ever had, any offices, facilities, bank accounts, telephone listings,
mailing addresses, agents or employees, nor designated an agent for service of process in
Minnesota. The affidavit further states that Xpotential has never owned or rented any real
property, paid taxes, or solicited or directed any advertisements in Minnesota.
Snap submitted an affidavit from one of its attorneys in opposition to Xponential’s
motion to dismiss (Snap affidavit). The Snap affidavit asserts that four Xponential
subsidiaries—Club Pilates, CycleBar, Stretch Lab and Pure Barre —operate in Minneso ta
and includes various screenshots from webpages as exhibits . Two of the exhibits are job
postings for StretchLab Minnesota and StretchLab Plymouth. Xponential’s name appears
at the top of the screenshots for both job postings and is included in the webli nk address
for one of them. Another exhibit is a webpage for a n invite to a webinar, titled “Studio
Ownership 101,” that states it will provide information on the basics of franchising with
Pure Barre. The LinkedIn profiles for the two instructors identified in the webinar posting
are also included as exhibits. The first profile is for the chief international development
officer for Xponential, identifying his geographic location as Irvine, California. The
second LinkedIn profile is for an individual with areas of expertise list ed as “Project

1 The district court’s ruling on the temporary injunction motion is not at issue on this
appeal.

5
Management/Real Estate Services.” The only company identified on the posting is Club
Pilates along with the individual’s geographic location of “Orange County, California
Area.” The Snap affidavit, however, includes a link to Xponential’s real e state webpage
that identifies the person in the second LinkedIn profile as the person responsi ble for a
multi-state geographic region that includes Minnesota. Finally, the affidavit includes a
screenshot from the Apple App Store that lists Xponential as the seller of the IOS app for
its Pure Barre subsidiary.
Following a hearing, the district court issued an order denying Xponential’s motion
to dismiss. The district court reasoned:
Xponential staff maintain significant involvement with its
brands in Minnesota. Those Minnesota contacts imply
Xponential routinely participates in training, marketing and
real estate site selection for its affiliates. To the extent
Marshall will be supporting those affiliates in his new role with
Xponential, Xponential’s contacts with Minnesota are directly
related to this proceeding.

The court went on to hold that, although there is not a forum selection clause in the
noncompete agreement, Minnesota is a proper forum for disputes arising out of th at
agreement and that Xponential should have reasonably anticipated being hailed into court
in Minnesota. The district court found sufficient minimum contacts to support specific
personal jurisdiction and, thus, it did not analyze whether or not Minnesota had general
personal jurisdiction over Xponential.2 This appeal follows.

2 The district court also held that service of process through the Minnesota Secretary of
State was proper under Minn. Stat. § 5.25, subd. 4 (2018), which provides that foreign
corporations may be served through the secretary of state if they commit a tort in
Minnesota. Appellant has asserted improper service of process as one of the issues on this

6

D E C I S I O N
“Whether personal jurisdiction exists is a question of law, which we review
de novo.” Rilley v. MoneyMutual, LLC , 884 N.W.2d 321, 326 (Minn. 2016) (quotatio n
omitted). When a defendant challenges personal jurisdiction, “the burden is on the plaintiff
to prove that sufficient contacts exist with the forum state. ” Juelich v. Yamazaki Mazak
Optonics Corp. , 682 N.W.2d 565, 569-70 (Minn. 2004). “When reviewing a motion to
dismiss for lack of personal jurisdiction, [appellate courts] determine whether, taking all
the factual allegations in the complaint and supporting affidavits as true, the plaintiff has
made a prima facie showing of personal jurisdiction.” Rilley, 884 N.W.2d at 326.
The Minnesota long-arm statute sets out the scope of authority for the exercise of
personal jurisdiction over a nonresident defendant. Minn. Stat. § 543.19 (2018); Domtar,
Inc. v. Niagara Fire Ins. Co. , 533 N.W.2d 25, 29 (Minn. 1995). The statute has been
interpreted as authorizing personal jurisdiction to the full extent permitted by federal due-
process requirements. Valspar Corp. v. Lukken Color Corp., 495 N.W.2d 408, 410 (Minn.
1992). Thus, the Minnesota long-arm statute is satisfied if the requirements of fed eral due
process are satisfied. Domtar, Inc., 533 N.W.2d at 29.
For an exercise of personal jurisdiction to comply with due process, the defendant
must have purposefully established “minimum contacts” in the forum state. Burger King
Corp. v. Rudzewicz, 471 U.S . 462, 474, 105 S. Ct. 2174, 2183 (1985). The analysis of the

appeal but, b ecause we conclude that the district court lacked personal jurisdiction over
Xponential, we do not reach this issue.

7
sufficiency of the contacts between the state and the nonresident defendant differs
depending on whether the jurisdiction is premised on specific or general personal
jurisdiction. Domtar, Inc., 533 N.W.2d at 30. Specific personal jurisdiction exists when
the complaint arises out of or is related to the defendant’s contacts with the forum state.
Helicopteros Nacionales de Colum., S.A. v. Hall, 466 U.S. 408, 414, 104 S. Ct. 1868, 1872
(1984). The number and nature of the contacts needed to support specific personal
jurisdiction can be more limited, but the suit-related conduct must, nevertheless, “create a
substantial connection with the forum [s]tate.” Walden v. Fiore , 571 U.S. 277, 284, 134
S. Ct. 1115, 1121 (2014 ). General personal jurisdiction exists when the contacts between
the state and the nonresident defendant are so substantial that the defendant ca n be made
to answer claims in the forum state regardless of whether the claims are related to the nature
of the defendant’s forum state contacts. Domtar, Inc., 533 N.W.2d at 30 .
A. The evidence is not sufficient to establish specific personal jurisdiction.
The district court based its personal -jurisdiction ruling on the grounds that
“Xponential staff maintain significant involvement with its brands in Minnesota” and that,
“[t]o the extent Marshall will be supporting those affiliates in his new role with Xponential,
Xponential’s contacts with Minnesota are directly related to this proceeding.” We
disagree. While it is possible that facts could be developed to sup port the exercise of
personal jurisdiction over Xponential, the evidence presented in the record on this appeal
fails to demonstrate the “minimum contacts” necessary to satisfy due-process
requirements.

8
Minnesota courts assess five factors to determine whether specific personal
jurisdiction exists: “ (1) the quantity of contacts with the forum state; ( 2) the nature and
quality of those contacts; (3) the connection of the cause of action with these contacts;
(4) the interest of the state providing a forum; and (5) the convenience of the parties.”
Rilley, 884 N.W.2d at 328 (quoting Juelich, 682 N.W.2d at 570). The first three factors
assess whether a defendant had sufficient minimum contacts with Minnesota and are the
“primary factors.” Hardrives, Inc. v. City of LaCrosse, Wis., 240 N.W.2d 814, 817 (Minn.
1976). The remaining two factors determine whether jurisdiction is reasonable under the
concepts of fair play and substantial justice. Juelich, 682 N.W.2d at 570.
We need look no further than the evidence with regard to the first three factors —
the number, nature and quality of the contacts and their connection to the lawsuit —to
conclude that Snap has failed in its burden to demonstrate personal jurisdiction. On factors
one and two, Snap claims that Xponential has numerous contacts with Minnesota in its own
name as well as through its subsidiaries. Specifically, Snap asserts that Xponential has
subsidiaries that operate in the state; has its name on franchisee job postings; offered a
franchise 101 webinar hosted by Xponential executives ; has an employee who supports
real-estate development in a multi-state region of the United States that includ es
Minnesota; offers an app in the Apple IOS store for its Pure Barre subsidiary; and recruited
and hired Marshall, a Minnesota resident.
Many of these contacts , however, are attributable not to Xponential but to its
subsidiaries and their franchisees. T he law is clear that contacts of a subsidiary cannot be
used to establish jurisdiction over a parent corporation. Garber v. Bancamerica -Blair

9
Corp., 285 N.W. 723, 727 (Minn. 1939) (“The use of a subsidiary does not subject the
parent to jurisdiction of the state, where . . . the separate existence of each is recognized
and maintained.”). With no allegation of, or sufficient evidence to justify, piercing the
corporate veil , we must assume that the separate exist ence of Xponential and its
subsidiaries has been maintained. Consequently, facts such as Xponential’s ownership of
subsidiaries that do business in Minnesota is not relevant to the jurisdiction analysis.
Turning to t he other evidence put forward by Snap , such as the webinar and job
postings, it falls short in establishing activity purposefully directed at Minnesota by
Xponential. See Bandemer v. Ford Motor Co. , 931 N.W.2d 744, 750 (Minn. 2019), cert.
granted, 140 S. Ct. 916 (2020)3; Griffis v. Luban, 646 N.W.2d 527, 534 -35 (Minn. 2002).
For example, the screenshots showing that Xponential’s name appears at the to p of two
postings for jobs at franchises of a subsidiary do not demonstrate that Xponential was
aware of or in any way directed or was otherwise involved in the postings. The fact that
Xponential employees were the instructors for a webinar and that apps are available under
the Xponential name in the Apple IOS store, likewise fails to show any specific connectio n
to Minnesota. The webinar could have been conducted entirely in California to a national
audience and there is no allegation that Minnesotans were its intended target. “ [I]t is . . .
insufficient to rely on a defendant’s random, fortuitous, or attenua ted contacts” to satisfy
due-process requirements. Walden, 571 U.S. at 286, 134 S. Ct. at 1123 (quotation omitted);

3 While the United States Sup reme Court has accepted review of this case, it remains
binding precedent on this court unless and until it is reversed by the Supreme Court.

10
see also Rilley, 884 N.W. 2d at 334 (stating “a purely national advertising campaign that
does not target Minnesota specifically cannot support a finding of personal jurisdiction”).
Snap’s evidence about the Xponential website real -estate page fails for the same
reason: the page shows no more than that the company has divided the country into regions
with a representative assigned to a multi-state region that includes Minnesota. This, by
itself, does not establish any level of “contacts” with Minnesota. For example, the re is no
evidence that Xponential employees travel and conduct business in the state. In fact, the
only direct evidence on this point is Xponential’s affidavit that states “none of Xponential’s
employees have ever traveled to Minnesota for Xponential -related business.” While a
conclusory statement, it stands unrebutted by Snap.
We next turn to the third factor, whether Xponential’s contacts with Minnesota are
connected to the cause of action. See Bristol-Myers Squibb Co. v. Superior Court of Cal.,
137 S. Ct. 1773, 1781 (2017 ) ( stating c ontacts with the forum must form a connectio n
“between the forum and the specific claims at issue”). Snap argues that the contacts relate
to this cause of action because Marshall was a Minnesota resident, working for a company
with its headquarters located in the state and the job description created by Xponential has
him supporting their subsidiary brands, presumably including support in Minnesota. While
this is a closer question, we conclude that there is not a sufficient connection between the
complaint against Xponential and Xponential’s limited contacts with Minnesota.
Specific personal jurisdiction requires a connection between the cause of action and
the contact with the forum state , not merely a person residing there. Walden, 571 U.S. at
285, 134 S. Ct. at 1122. At most, the contact via the recruiter targeted Marshall, it did not

11
target Minnesota. Xponential did not have any additional contacts with Minnesota. No
one traveled to Minnesota to interview or hire Marshal l. To the contrary, it was Marshall
who traveled to California to be interviewed. The hiring of Marshall did not result in
Xponential “purposefully availing itself ” of Minnesota’s “privileges, benefits, and
protections.” Rilley, 884 N.W.2d at 327 (quotation omitted). While the hiring of Marshall
presumably benefited Xponential at the expense of Snap, the con nection with the forum
state is, nevertheless, lacking.
Snap relies on this court’s decision in C.H. Robinson Worldwide, Inc. v. FLS
Transp., Inc. , where FLS, a Canadian corporation, targeted and hired eight of C.H.
Robinson’s former employees. 772 N.W.2d 528, 532 (Minn. App. 2009). The noncompete
agreements at iss ue in the case contain ed choice -of-law and forum-selection clauses
designating Minnesota and its federal and state courts. Id. at 533. The former employees
were alleged to have wrongfully used C.H. Robinson’s “confidential and proprietary
information and solicit[ed] [C.H. Rob inson]’s customers ” on behalf of FLS. Id. at 532.
Additionally, FLS allegedly instructed former C.H. Robinson employees to induce other
employees to breach their contracts and told them that “such obligations can be secretly
circumvented, [C.H. Robinson] will never know, and in the event legal action is
commenced FLS will support and defend” them. Id. at 533 (quotation omitted). This court
found sufficient minimum contacts existed becau se of the choice -of-law and forum -
selection clauses, combined with the fact that the defendants explicitly contacted the forum
in knowing violation of the noncompete clauses. Id. at 537.

12
The C.H. Robinson case is distinguishable on a couple of grounds. First, there is no
forum-selection clause in Marshall’s noncompete agreement and, while there is a choice-
of-law clause, it designates the laws of Delaware, not Minnesota.
Second, in C.H. Robinson there was evidence that FLS explicitly directed its
employees to target C.H. Robinson employees and to induce them to breach their contracts.
Id. at 535. No such evidence has been presented here. Xponential hired Marshall, but there
is no evidence in the record that it set out to target a company headquartered in Minneso ta
or that Xponential was aware of the noncomplete agreement at the time of Marshall’s
employment offer.
We find the Minnesota Supreme Court’s decision in Griffis v. Luban to be
instructive. Griffis explores the scope of specific personal jurisdiction in tort cases
involving nonresidents. 646 N.W.2d at 53 0-34. In declining to enforce a defamatio n
judgment of an Alabama court in Minnesota, the court stressed that a “plaintiff must show
that the defendant knew that the plaintiff would suffer the brunt of the harm caused by the
tortious conduct in the forum , and point to specific activity indicating that the defendant
expressly aimed its tortious conduct at the forum. ” Id. at 534 (quotation omitted). The
court concluded that the fact the author of the defamatory statements knew the plaintiff
was an Alabama resident and that plaintiff’s career would be damaged in Alabama as a
result of the statements was not enough to demonstrate that the statements were “expressly
aimed” at the state of Alabama. Id. at 535-36. The supreme court held that the Alabama
courts lacked specific personal jurisdiction over the defendant under the Due Process
Clause and denied enforcement of the judgment in Minnesota. Id. at 536-37.

13
Similarly here, Xponential knew that Marshall was employed by a company in
Minnesota and, arguably, would have been aware that the company might be harmed by
losing one of its executives, but the evidence of Xponential’s contacts with Minnesota fai ls
to rise to the level of the conduct found to support personal jurisdiction in C.H. Robinson.
It also fails to establish that Xponential “expressly aimed” its contacts at Minnesota, Griffis,
646 N.W.2d at 535, or otherwise “purposefully avail[ed] itself of the privileges, benefits,
and protections of” the State of Minnesota when it hired Marshall , Rilley, 884 N.W.2d at
327 (quotation omitted). We, therefore, conclude that the evidence is not sufficient to
establish specific personal jurisdiction over Xponential based on the record in this appeal
and reverse the district court’s ruling to the contrary.4
B. Based on our conclusion that Xponential lacks sufficient contacts to
support specific personal jurisdiction, the claim of general jurisdictio n
must also fail.

Snap claims that Xponential is subject to general personal jurisdiction in Minneso ta.
The district court did not rule on this issue because it found that Xponential was subject to
specific personal jurisdiction. General jurisdiction, “exists when a nonresident defendant’s
contacts with the forum state are so substantial and are of such a nature that the state may
assert jurisdiction over the defendant even for causes of action unrelated to the defendant’s
contacts with the forum state.” Domtar, Inc., 533 N.W.2d at 30 (emphasis added).
For an individual, the typical forum for the exercise of general jurisdiction is the
individual’s state of domicile. Daimler AG v. Bauman, 571 U.S. 117, 137 , 134 S. Ct. 746,

4 Based on our conclusions with regard to the first three factors, it is not necessary for us
to reach the final two prongs of the specific personal-jurisdiction analysis.

14
760 (2014). For a business entity, the key inquiry for general jurisdiction is “ whether [the]
corporation’s affiliations with the State are so continuous and systematic as to render it
essentially at home in the forum State.” Id. at 139, 134 S. Ct. at 761 (quotation omitted).
General juris diction is typically limited to the state or states where a business is
incorporated and its principal place of business is located. Id. at 137, 134 S. Ct. at 760.
The Supreme Court has declined to hold that a corporation may be subject to general
jurisdiction in only these places; however, it has “made clear that only a limited set of
affiliations with a forum will render a defendant amenable to [general] jurisdiction there.”
Id. at 137, 134 S. Ct. at 760 ; see also id. at 139 n.19, 134 S. Ct. at 761 n.19 (“We do not
foreclose the possibility that in an exceptional case, . . . a corporation’s operations in a
forum other than its formal place of incorporation or principal place of business may be so
substantial and of such a nature as to render the corporation at home in that State.” (citatio n
omitted)).
Snap relies on the same evidence to support its argument for general jurisdiction as
its argument supporting specific personal jurisdiction. B ased on our conclusion regarding
specific personal jurisdiction, we similarly conclude that there is no basis to support the
much higher standard required for a finding of general jurisdiction.
C. Snap’s request for a r emand to allow limited jurisdictional discovery is
not properly before this court.

Snap also argues that, if this court does not find sufficient minimum contacts to
establish personal jurisdiction in Minnesota, this court should remand for limited
jurisdictional discovery. Snap , however, did not make a motion to the district court

15
regarding additional discovery. Instead, it included a one-line footnote in its memorand um
in opposition to Xponential’s motion to dismiss that states “[i]n the alternative, the Court
should allow additional discovery as to Xponential’s jurisdictional contacts with
Minnesota.” The district court did not address the issue of discovery. This court may not
address an issue unless it is properly raised to and addressed by the district court. See
Thiele v. Stich, 425 N.W.2d 580, 582 -83 (Minn. 1988). Therefore, we decline to consider
whether the district court erred by failing to grant jurisdictional discovery. Nw. Airlines,
Inc. v. Friday, 617 N.W.2d 590, 595 (Minn. App. 2000) (declining to consider argument
for jurisdictional discovery raised only in a footnote before the district court, which did not
consider or decide it).
Reversed.