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Ebert v. Levy

United States District Court, W.D. Louisiana, Shreveport Division

February 15, 2018





         Before the Court are Motions to Dismiss by Defendants Hirant Manakyan, Herman Manakyan, Fusion Sports, S A.R.L.[1] ("Fusion") (collectively, "FusionDefendants"), and Pascal Levy ("Levy"). [Record Documents 7 and 11]. Plaintiff Gary Ebert ("Ebert"), appearing pro se, has filed an opposition, and the Fusion Defendants have filed a reply. [Record Documents 13, 15, and 18]. Levy, appearing pro se, the Fusion Defendants, and Ebert have separately filed affidavits in response to the Court's request for additional information to clarify Defendants' relationships in order to determine whether the Court may properly exercise personal jurisdiction. [Record Documents 29-31]. The Fusion Defendants have objected to Ebert's affidavit. [Record Document 32]. Having considered the foregoing as well as the remainder of the record, the Court GRANTS the motions to dismiss. The pending motion to disqualify counsel filed by Ebert [Record Document 13] is DENIED AS MOOT.

         I. Background

         A. Factual Background

         Ebert is an international basketball agent living in Louisiana who represented players Mike Smith ("Smith"), Brandon Spann ("Spann"), and Ryan Moss ("Moss") (collectively, "the Players"), [Record Document 31 at 2]. In 2005, Ebert and Levy, a French citizen living in France, entered into an oral agreement ("2005 Agreement") whereby Levy would assist Ebert in placing the Players on French basketball teams in exchange for a share of the agency fees. [Record Documents 1-13 at 6, 30 at 1, 31 at 1-2]. Following the Players' placement on teams, Levy allegedly failed to pay Ebert's share of certain fees and failed to diligently collect others. [Record Document 1-13 at 6-7]. Beginning in 2006, Ebert repeatedly demanded that Levy comply with his obligations. [Record Documents 1-13 at 7 and 31 at 3]. In 2012, Levy became an employee and partial owner of Fusion, a French sports management company founded by Hirant Manakyan, a French resident and citizen. [Record Documents 1 -6 at 12 and 29-1 at 3-4]. Herman Manakyan, a Maryland resident and United States citizen, originally worked as a consultant for Fusion, but has since become a partial owner. [Record Document 29-1 at 5-6]. Ebert alleges that the Fusion Defendants share Levy's liability as a result of his association with the company. [Record Document 1-13 at 7].

         B. Procedural History

         Ebert filed an "Original Petition for Damages" in the 26th Judicial District Court of Louisiana against "Pascal Levy, Individually, and d/b/a 5A's and Fusion Sport, " alleging breach of contract, conversion, tort fraud, and breach of fiduciary duty. [Record Document 1 -2]. Ebert prayed for $ 11, 134.99 plus interest, attorney fees, and "general damages for defendants' fraud and [b]reach of fiduciary duty." [ Id. at 10-11]. Although maintaining that it had not been properly named as a defendant, Fusion filed exceptions of lack of personal jurisdiction, insufficient citation and service of process, no cause of action, and prescription. [Record Document 1-6]. At a show cause hearing, the state court denied the exceptions of insufficient citation and service of process and granted the exception of a lack of personal jurisdiction, giving Ebert fifteen days to amend his petition. [Record Document 1 at 2]. The court also entered a preliminary default against Levy. [Record Document 9-1 at 18].[2]

         Ebert also amended his petition, naming Levy, Herman Manakyan, Hirant Manakyan, and Fusion as defendants, adding claims under the federal Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18 U.S.C.A §§ 1961-1968 (West 2015 & Supp. 2017), and its Louisiana equivalent, La. Stat. Ann. §§ 15:1351-1356 (2015 & Supp. 2018), and increasing his monetary demand to $2, 225, 881.99 and "actual damages in an amount to be proven at trial, plus treble damages, attorneys' fees, interest, and costs, " [Record Document 1-13 at 2, 11, 14]. In response, the Fusion Defendants filed a notice of removal. [Record Document 1], Ebert then filed a demand for jury trial, the transcript from the show cause hearing, and the state court order setting a hearing on the default judgment. [Record Documents 6 and 9]. The Fusion Defendants again moved to dismiss for lack of personal jurisdiction, for failure to state a claim on which relief can be granted, and for insufficient process and service of process. [Record Document 7]. Levy filed an answer incorporating what the Court construes as a motion to dismiss on grounds of prescription, lack of personal jurisdiction, and insufficient service of process. [Record Document 11]. Ebert opposed Levy's motion to dismiss, moved to disqualify the Fusion Defendants' counsel, and moved for additional time to replead. [Record Documents 13 and 18]. The Court denied the motion for additional time and ordered Ebert to file a Civil RICO case statement. [Record Document 16]. Ebert filed his statement, which names as defendants Levy, the Fusion Defendants, and "Cook Yancey King and Galloway APLC." [Record Document 22][3]Confronted with insufficient information to accurately assess its personal jurisdiction, the Court ordered the parties to submit affidavits or other authenticated evidence addressed to jurisdictional matters. [Record Document 24]. The parties have complied. [Record Documents 29-31].

         C. Ebert's Allegations

         Because there are substantial disagreements about the facts of the case, the Court will outline Ebert's allegations in detail. According to Ebert, he and Levy were to share any agency fees earned on contracts between the Players and their French basketball teams. [Record Document 1-13 at 6], Although Levy made a partial payment of Ebert's share of the agency fees for Moss in March or April 2006, [Record Document 31 at 2], it is unclear from the record whether Levy made any payments in relation to Smith or Spann. Additionally, Ebert alleges that Smith's club incurred "mandatory 7% monthly late fees" that Levy failed to collect. [Record Document 1 -13 at 6]. On June 1, 2006, Ebert sent Levy an invoice, following up on June 27, 2006 with an offer to compromise the matter. [Id. at 6-7].

         According to Ebert, in 2005 Levy was "doing business as" 5 A's ("5 A's");[4] subsequently, he and the Manakyans formed Fusion to "take over the representation activities of 5A's." [Id. at 2-3, 7]. Levy then allegedly used money that he should have paid to Ebert under the 2005 Agreement to travel and recruit basketball players for himself and Fusion. [ Id. at 12]. Ebert seeks not only the amount that he was owed under the 2005 Agreement, but also "any profits realized by Defendants through the use of Plaintiff s funds in any other business ventures." [Id. at 14].

         Ebert also alleges that Defendants violated RICO via "fraudulent inducement by Defendants of Plaintiff to use Plaintiffs resources and subornation or purjury [sic], and the related fraudulent conversion of Plaintiff s converted funds." [ Id. at 11]. Effectively, Ebert alleges that Levy breached the 2005 Agreement in concert with the Fusion Defendants through the use of interstate mail or wire communications. [Id. at 10-11 ]. In his RICO case statement, Ebert expands his allegations to include the participation of a variety of attorneys, including counsel for the Fusion Defendants and counsel who represented Ebert in other cases; he alleges that these attorneys conspired to "self-deal, " engage in conflicting interest representations, and file false pleadings and other documents. [Record Document 22].

         II. Law and Analysis

         A. 12(b)(2)Standard

         Rule 12(b)(2) of the Federal Rules of Civil Procedure authorizes a motion to dismiss for lack of personal jurisdiction. At trial, a plaintiff must prove personal jurisdiction over each defendant by a preponderance of the evidence. In re Chinese Manufactured Drywall Prods. Liab. Litig., 742 F.3d 576, 584-85 (5th Cir. 2014) (citing Caldwell v. Palmetto State Sav. Bank of S.C, 811 F.2d 916, 917 (5th Cir. 1987)). However, to survive a motion to dismiss, a plaintiff need only establish a prima facie case. Walk Haydel &Assocs., Inc. v. Coastal Power Prod. Co., 517 F.3d 235, 241 (5th Cir. 2008) (citing Irving v. Owens-Corning Fiberglas Corp., 864 F.2d 383, 384 (5th Cir. 1989); Thompson v. Chrysler Motors Corp., 755 F.2d 1162, 1165 (5th Cir. 1985)). Although a court must accept a plaintiff s uncontroverted jurisdictional allegations as true, it need not "credit conclusory allegations, even if uncontroverted." Panda Brandywine Corp. v. Potomac Elec. Power Co., 253 F.3d 865, 869 (5th Cir. 2001) (citing Felch v. Transposes Lar-Mex SA DE CV, 92 F.3d 320, 326 n.16 (5th Cir. 1996); Mass. Sch. of Law at Andover, Inc. v. Am. BarAss'n, 142 F.3d 26, 34 (1st Cir. 1998)). Moreover, a court may accept affidavits or other recognized forms of discovery to clarify a difficult question of jurisdiction. Allred v. Moore & Peterson, 117 F.3d 278, 281 (5th Cir. 1997) (citing Stuart v. Spademan, 772 F.2d 1185, 1192 (5th Cir. 1985)). If a defendant's affidavit contradicts any of the plaintiff s jurisdictional allegations, a court evaluates whether the plaintiff has stated a prima facie case by examining her "nonconclusory allegations supported by admissible evidence." Sealed Appellant 1 v. Sealed Appellee 1, 625 Fed.Appx. 628, 631 (5th Cir. 2015) (per curiam). Applying this standard, Ebert has the burden of stating a prima facie case. Because Defendants' evidence contradicts some of Ebert's allegations, the Court must evaluate his prima facie case on the basis of his nonconclusory and supported allegations.

         B. Law of Personal Jurisdiction

         This Court may exercise personal jurisdiction to the same extent as a Louisiana court. Walk Hay del, 517 F.3d at 242 (citing Access Telecomm., Inc. v. MCI Telecomm. Corp., 197 F.3d 694, 716 (5th Cir. 1999)). Louisiana's long-arm statute authorizes personal jurisdiction to the maximum extent allowed by the Due Process Clause. Id. at 242-43 (citing A & L Energy, Inc. v. Pegasus Grp., 2000-3255, p. 4 (La. 6/29/01); 791 So.2d 1266, 1270)). Therefore, the questions before the Court with regard to each defendant are "(1) [whether] that defendant has purposefully availed himself of the benefits and protections of the forum state by establishing 'minimum contacts' with the forum state; and (2) [whether] the exercise of jurisdiction over that defendant.. . offend[s] 'traditional notions of fair play and substantial justice.'" Mink v. AAAA Dev. LLC, 190 F, 3d 333, 335 (5th Cir. 1999) (quoting Latshaw v. Johnson, 167 F.3d 208, 211 (5th Cir. 1999)). The potential burdens of litigation render "the minimum contacts analysis . .. particularly important when the defendant is from a different country." Special Indus., Inc. v. Zamil Grp. Holding Co., 578 Fed.Appx. 325, 328 (5th Cir. 2014) (per curiam) (quoting BMC Software Belg., N. V. v. Marchand, 83 S.W.3d 789, 795 (Tex. 2002)).

         "Minimum contacts" may give rise to either general personal jurisdiction or specific personal jurisdiction. Choice Healthcare, Inc. v. Kaiser Found. Health Plan of Colo., 615 F.3d 364, 368 (5th Cir. 2010). General personal jurisdiction empowers a court to hear "any and all claims" against a defendant whose contacts with the forum state are "continuous and systematic" such that the defendant is "at home" in the state. Daimler AG v. Bauman, 134 S.Ct. 746, 751, 754 (2014) (quoting Goodyear Dunlop Tires Operations, Inc., S.A. v. Brown, 564 U.S. 915, 919 (2011)). For a natural person, general personal jurisdiction exists in her state of domicile. Milliken v. Meyer, 311 U.S. 457, 463-64 (1940). A defendant is also subject to suit on any matter regardless of her contacts with the forum state when she is personally served while physically present there. Burnham v. Superior Court of Cal, Cty. of Marin, 495 U.S. 604, 628 (1990) (plurality opinion).

         Specific personal jurisdiction allows suit to proceed if the matter is related to a defendant's contacts with the forum state. Helicopteros Nacionales de Colom., S.A. v. Hall, 466 U.S. 408, 414 & n.8 (1984) (citing Shaffer v. Heitner, 433 U.S. 186, 204 (1977)). To determine whether a court may exercise specific jurisdiction, the Fifth Circuit prescribes a three-step analysis: "(1) whether the defendant has minimum contacts with the forum state; (2) whether the plaintiffs cause of action arises out of or results from the defendant's forum-related contacts; and (3) whether the exercise of personal jurisdiction is fair and reasonable." Jackson v. Tanfoglio Giuseppe, S.R.L., 615 F.3d 579, 585 (5th Cir. 2010) (citing Seiferth v. Helicopteros Atuneros, Inc., 472 F.3d 266, 271 (5th Cir. 2006)). The contacts, while not as substantial as those required for an exercise of general jurisdiction, may not be merely "random, fortuitous, or attenuated." Clemens v. McNamee, 615 F.3d 374, 379 (5th Cir. 2010) (citing Burger King v. Rudzewicz, 471 U.S. 462, 472 (1985)). Although the defendant's physical presence in the state is not required, Burger King, 471 U.S. at 476, "merely contracting with a resident of the forum state does not establish minimum contacts, " Moncrief Oil Int'l Inc. v. OAO Gazprom, 481 F.3d 309, 311 (5th Cir. 2007) (citing Latshaw, 167 F.3d at 211; Hydrokinetics, Inc. v. Alaska Meek, Inc., 700 F.2d 1026, 1028 (5th Cir. 1983)). If the plaintiff successfully establishes the first two prongs, the burden shifts to the defendant to show that litigation in the forum state would be "'so gravely difficult and inconvenient' that a party unfairly is at a 'severe disadvantage' in comparison to [its] opponent." Burger King, 471 U.S. at 478 (first quoting M/S Bremen v. Zapata Off Shore Co., 407 U.S. 1, 18 (1972); then quoting McGee v. Int'l Life Ins. Co., 355 U.S. 220, 223 (1957)).

         C. Jurisdiction over the Fusion Defendants

         1. ...

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