## Facts

- Intermeat, Inc. (New York) regularly sold meat to American Poultry Inc. (Ohio) using Intermeat’s printed form contracts, which included a New York arbitration clause.
- Across prior transactions, American Poultry sometimes signed and returned the forms; other times it kept them without objection and performed; it had previously arbitrated disputes in New York under the same contractual arrangement.
- In January 1974, American Poultry ordered two loads of Australian beef (30 long tons) for delivery from Australia to Philadelphia; Intermeat sent its standard form with the New York arbitration clause.
- American Poultry retained the form, did not sign it, and did not object to its terms; it received the beef in Philadelphia and transported it to its Cleveland facility.
- After inspection in Ohio, American Poultry rejected the meat as nonconforming, later resold it, and remitted to Intermeat only the difference between the contract price and the resale proceeds.
- Intermeat sued in New York state court for damages for wrongful rejection and underpayment; American Poultry removed to federal court on diversity grounds.
- The district court found no in personam jurisdiction over American Poultry but permitted attachment of a debt owed to American Poultry by a New York customer, and proceeded on a quasi in rem theory to enter judgment for Intermeat.
- American Poultry’s New York business was substantial (about 25–30% of its sales, up to roughly $7 million annually).

## Issues

1. Whether, after *Shaffer v. Heitner*, quasi in rem jurisdiction based on attachment of a debt located in New York satisfies due process absent traditional in personam jurisdiction.
2. Whether American Poultry’s New York contacts—including substantial sales in the state and a course of dealing involving New York arbitration clauses—provided “minimum contacts” making New York’s exercise of jurisdiction fair and reasonable.
3. Whether American Poultry was bound by the New York arbitration clause in Intermeat’s standard form contract for the January 1974 transaction despite not signing that specific form.

## Decision

- The Second Circuit affirmed the judgment for Intermeat.
- The court held that quasi in rem jurisdiction based on the New York attachment satisfied due process because American Poultry had sufficient minimum contacts with New York.
- The court treated American Poultry’s repeated acceptance (by retention and performance) of Intermeat’s form contracts and prior New York arbitrations as evidence that the New York arbitration clause was part of the parties’ agreement and supported purposeful availment of the forum.
- Given the volume and continuity of American Poultry’s New York business, requiring it to defend in New York was consistent with fair play and substantial justice.

## Legal Principles

- After *Shaffer v. Heitner*, quasi in rem jurisdiction based on property attached in the forum is constitutional only if the defendant’s overall relationship to the forum satisfies *International Shoe* minimum-contacts due process standards.
- Attachment of an in-forum debt may support quasi in rem jurisdiction when the attachment is coupled with substantial, forum-directed commercial activity by the defendant.
- In commercial transactions, assent to standard contract terms—including arbitration/forum clauses—may be inferred from course of dealing and performance where a party receives forms, fails to object, and repeatedly conducts business under them.
- Substantial, continuous commercial dealings in a state can make it reasonably foreseeable that the defendant may be required to litigate (or arbitrate) there, supporting the fairness component of due process.

## Conclusion

The court upheld New York’s quasi in rem jurisdiction based on attachment of a New York debt because the defendant’s substantial New York business and established course of dealing—accepting and previously honoring a New York arbitration clause—created minimum contacts sufficient to satisfy due process and sustain the judgment for the seller.


Intermeat, Inc. v. American Poultry Inc., 575 F.2d 1017 (2d Cir. 1978)