The Long Arm of the North Star State: Minnesota's Jurisdictional Reach in Business Litigation

Businesses and the people who lead them are well aware of their exposure to lawsuits in certain jurisdictions. In general, a company can be sued for any reason in its state of organization and the state where its principal place of business is located. Individuals can be sued in the state where they are domiciled.[1] Businesses and individuals can also be sued in other states on a case-by-case basis if the lawsuit "arises out of or relates to" their contacts in that state.[2]

But there are a few less obvious circumstances in which companies and their officers may be subject to lawsuits in Minnesota courts. This article highlights two such circumstances, and offers key takeaways to keep in mind when navigating business risks in Minnesota.

Acts by Corporate Officers in Their Official Capacity

In Minnesota, officers/directors and shareholders/members are typically treated separately from the companies they manage or own for purposes of liability. For example, a limited liability company is an entity distinct from its members, and its liabilities do not become the liabilities of its members, managers, or governors by reason of them acting in their official capacity.[3] And for purposes of jurisdiction, an officer is not subject to suit in Minnesota merely because the court can exercise jurisdiction over the company.[4] So, one might assume that a nonresident officer whose only Minnesota contacts were undertaken on behalf of the company in a corporate capacity cannot be sued in Minnesota in his or her personal capacity. Think again.

The notion that a nonresident corporate agent should not be individually subject to a court’s jurisdiction based on acts undertaken on behalf of the corporation is sometimes referred to as the "fiduciary shield" exception. As a matter of federal law, the United States Supreme Court has long "rejected the suggestion that employees who act in their official capacity are somehow shielded from suit in their individual capacity."[5] Rather, the exception is a product of state law. And over the course of many years, Minnesota courts have declined to apply the exception, if not outright rejected it.[6] This means that, in Minnesota, even if an individual’s contacts resulted from activity in a corporate capacity, that individual still "may be subject to personal jurisdiction if minimum contacts are established."[7]

These principles were reiterated in a recent shareholder dispute in which Maslon served as lead defense counsel. There, minority shareholders of a Minnesota-based startup company sued another minority shareholder, a North Carolina-based company, and its CEO, a North Carolina resident. The court rejected the CEO’s argument that his Minnesota contacts should be disregarded in the personal-jurisdiction analysis because they were undertaken solely in his capacity as CEO, concluding this was the type of "fiduciary shield" exception that was not an element of constitutional due process and had never been adopted in Minnesota. Still, applying a traditional minimum-contacts analysis, the court dismissed the claims against the CEO because the record did not support the plaintiffs’ attempts to attribute the company’s activities in Minnesota solely to the CEO.

This case provides a helpful reminder that a nonresident corporate officer is not automatically insulated from suit in Minnesota merely because he or she was acting in a corporate capacity. The relevant inquiry remains whether the officer’s individual contacts with Minnesota are sufficient to create personal jurisdiction. (Learn more about our work in this case here.)

Forum Selection Clauses/Closely Related Doctrine

In addition to cases involving "minimum contacts," a nonresident defendant can be subject to personal jurisdiction in Minnesota by consent.[8] A frequent way in which nonresidents consent to personal jurisdiction is through contractual forum-selection clauses, in which the parties designate a specific court and location in which future disputes will be litigated. But what about a company or individual who never signed the contract—can they nevertheless be subject to personal jurisdiction in that forum? The answer is yes, but with an important caveat.

In general, a nonparty to a contract cannot be bound to the contract’s terms.[9] However, Minnesota courts have still exercised personal jurisdiction over a nonparty based on a forum-selection clause where the party is "so 'closely related' to the dispute that it becomes foreseeable that the party will be bound."[10] For example, in C.H. Robinson Worldwide, Inc. v. FLS Transportation, Inc., a corporation sued eight former employees and their new employer for breach of contract.[11] Five of those employees had signed an agreement with a forum-selection clause subjecting them to jurisdiction in Minnesota, while the agreements for the remaining employees did not contain such a provision. Despite this, the district court denied defendants’ motions to dismiss that challenged personal jurisdiction.

Citing federal case law as persuasive authority, the Minnesota Court of Appeals affirmed and concluded that the employees who were not subject to the forum-selection clauses were still sufficiently closely related to the dispute to be bound by them. The appellate court reasoned that the non-signatories were involved in the suit-provoking conduct and knew that the other employees were subject to a forum-selection clause, and that all defendants shared a common interest in their defenses and were represented by a common attorney. Under these circumstances, all defendants should have reasonably anticipated defending themselves in a Minnesota court, and the closely related doctrine subjected all defendants to personal jurisdiction.

Despite its acceptance among Minnesota’s lower courts, the closely held doctrine has not yet been adopted by the Minnesota Supreme Court. But this may change soon, as Minnesota’s highest court has agreed to review Medtronic, Inc. v. Lahn, a case in which the district court exercised personal jurisdiction over a California corporation by way of the forum-selection clause its employees had agreed to with their former employer.[12] As such, the fate of the closely related doctrine in Minnesota is still be determined, and legal observers will await the Minnesota Supreme Court’s forthcoming decision. For now, companies and their officers should be aware of their potential exposure to lawsuits in Minnesota, even in cases where they did not directly consent to jurisdiction in Minnesota courts.

Key Takeaways

• Corporate capacity is not an automatic jurisdictional shield in Minnesota. Courts will still examine the officer's own conduct, even when undertaken for the corporation.
• Plead and prove individualized contacts. Allegations referring collectively to "defendants," or that attribute a company’s conduct to its managers or owners without supporting facts, will not establish jurisdiction over the individual.
• Parties can still be bound to a contract they did not sign if they are deemed sufficiently related to the dispute. Unless and until the Minnesota Supreme Court narrows the scope of the closely related doctrine, a nonparty may face litigation in Minnesota even if it did not directly engage with the state or sign an agreement with a Minnesota forum-selection clause. A nonsignatory’s involvement in the underlying dispute, awareness of the forum selection clause, and sharing a common interest/counsel with a named defendant are all relevant factors a court will consider when deciding whether the nonsignatory is subject to personal jurisdiction.

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[1] Daimler AG v. Bauman, 571 U.S. 117, 137 (2014).

[2] Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985).

[3] Minn. Stat. §§ 322C.0104, subd. 1 & 322C.0304, subd. 1; see also Minn. Stat. § 302A.361, subd. 1 (officer of a corporation who discharges his or her duties in good faith, in the best interests of the corporation, and with due care "is not liable by reason of being or having been an officer of the corporation").

[4] Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 781 n. 13 (1984); State v. Cont’l Forms, Inc., 356 N.W.2d 442, 444 (Minn. Ct. App. 1984).

[5] Keeton, 465 U.S. at 781 n.13.

[6] See, e.g., Real Props., Inc. v. Mission Ins. Co., 427 N.W.2d 665, 668 (Minn. 1988) (rejecting notion that "any contacts with Minnesota as a [corporate] agent do not count" toward jurisdictional analysis, and stating that the member’s "own conduct does not merge or disappear when it wears [the company’s] hat"); M.G. Incentives, Inc. v. Marchand, No. 36-00-962, 2001 WL 96223, at *5 (Minn. Ct. App. Feb. 6, 2001) (fiduciary-shield exception "has never been adopted in Minnesota" and the "Minnesota Supreme Court has given no indication that it is inclined to do so."); see also Safco Prods. Co. v. Welcom Prods., Inc., 730 F. Supp. 2d 959, 966 (D. Minn. 2010) (recognizing that Minnesota has not adopted the doctrine).

[7] Stratasys, Inc. v. ProtoPulsion, Inc., No. A10-2257, 2011 WL 2750720, at *5 (Minn. Ct. App. July 18, 2011).

[8] Rykoff-Sexton, Inc. v. Am. Appraisal Assocs., Inc., 469 N.W.2d 88, 89–90 (Minn. 1991).

[9] State ex rel. Hatch v. Cross Country Bank, Inc., 703 N.W.2d 562, 569 (Minn. Ct. App. 2005).

[10] Fair Isaac Corp. v. Gordon, N. A16-0274, 2016 WL 7439084, at *2 (Minn. Ct. App. Dec. 27, 2016).

[11] 772 N.W.2d 528 (Minn. Ct. App. 2009).

[12] No. A25-1009, 2026 WL 570489 (Minn. Ct. App. Mar. 2, 2026).