United States District Court, E.D. Louisiana
SECTION
“R” (2)
ORDER AND REASONS
SARAH
S. VANCE, UNITED STATES DISTRICT JUDGE
Before
the Court are (1) defendant Hibbard Inshore, LLC's motion
to dismiss for lack of personal jurisdiction, and (2)
plaintiff Kristopher Embry's motion to
remand.[1] The Court grants defendant's motion to
dismiss because plaintiff has not shown that defendant has
minimum contacts with the state of Louisiana. The Court
denies plaintiff's motion to remand as moot.
I.
BACKGROUND
This
case arises from an employment dispute.[2] Plaintiff alleges
that he was employed by Hibbard Inshore from 2014-2018 as a
Client Relationship Manager.[3] Hibbard Inshore is a
Michigan-based organization with clients in many different
locations.[4] Plaintiff's duties for Hibbard Inshore
included attending sales conferences, making sales calls,
crafting proposals and estimates for potential clients, and
maintaining relationships with existing
clients.[5] Plaintiff completed these tasks remotely,
and he traveled to Hibbard Inshore's Michigan office only
about once per year.[6] During the second half of his employment
with Hibbard Inshore, plaintiff allegedly worked for part of
the year from his home in New Orleans,
Louisiana.[7] Plaintiff attests that he informed Hibbard
Inshore of his intention eventually to work remotely from New
Orleans before he was hired.[8] He states that, from 2016 until
his termination, he made and received sales calls that
involved both potential and existing clients from his home
office in New Orleans.[9] He also allegedly attended trade shows and
business meetings in New Orleans, and he allegedly took
clients to dinner on behalf of Hibbard Inshore when they were
in town.[10] Finally, plaintiff states that he once
hired a woman based in New Orleans to translate a set of
contracts used in a Hibbard project.[11] Plaintiff allegedly met
the employee in New Orleans, reviewed her work in New
Orleans, and paid her in New Orleans on behalf of Hibbard
Inshore.[12]
Plaintiff
alleges that defendant terminated his employment unexpectedly
on June 26, 2018.[13] As part of the termination process,
defendant allegedly provided plaintiff with a separation
agreement.[14]According to plaintiff, this agreement
contained terms that were unfavorable to him.[15] Plaintiff
alleges that he therefore refused to sign the
agreement.[16]At the time of plaintiff's
termination, defendant allegedly owed him vacation pay and
commissions on accounts that he sold before his
termination.[17]Defendant allegedly refused to pay the
amounts owed.[18] Shortly after his termination, plaintiff
filed for unemployment benefits in
Pennsylvania.[19]
On
December 19, 2018, plaintiff filed a petition for damages in
Orleans Parish Civil District Court seeking his unpaid wages,
penalty wages, attorney's fees, costs, and interest
pursuant to the Louisiana Wage Payment Act.[20] On February
15, 2019, defendant removed the case to this Court on the
basis of the Court's diversity
jurisdiction.[21] Defendant then filed a motion to dismiss
for lack of personal jurisdiction.[22] Plaintiff opposes the
motion.[23]
Plaintiff
also filed a motion to remand shortly after the case was
removed to federal court.[24] Defendant opposes the
motion.[25] In response to the motion, defendant
requested and was granted leave to file an amended notice of
removal that addresses the issues raised in plaintiff's
motion to remand.[26] On April 10, 2019, defendant filed an
amended notice of removal.[27]
II.
LEGAL STANDARD
Personal
jurisdiction is “an essential element of the
jurisdiction of a district court, without which the court is
powerless to proceed to an adjudication.” Ruhrgas
AG v. Marathon Oil Co., 526 U.S. 574, 584 (1999)
(alterations and internal quotation marks omitted). A
district court may exercise personal jurisdiction over a
defendant if “(1) the long-arm statute of the forum
state creates personal jurisdiction over the defendant; and
(2) the exercise of personal jurisdiction is consistent with
the due process guarantees of the United States
Constitution.” Revell v. Lidov, 317 F.3d 467,
469 (5th Cir. 2002). Because Louisiana's long-arm
statute, La. R.S. 13:3201, extends jurisdiction to the limits
of due process, the Court need only consider whether the
exercise of jurisdiction in this case satisfies federal due
process requirements. Dickson Mar. Inc. v. Panalpina,
Inc., 179 F.3d 331, 336 (5th Cir. 1999).
Personal
jurisdiction may be either general or specific. Seiferth
v. Helicopteros Atuneros, Inc., 472 F.3d 266, 271 (5th
Cir. 2006). “The plaintiff bears the burden of
establishing jurisdiction but is required to present only
prima facie evidence.” Id. at 270.
General jurisdiction over a foreign defendant exists if the
defendant's “affiliations with the State are so
‘continuous and systematic' as to render them
essentially at home in the forum State.” Goodyear
Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915,
919 (2011). The Fifth Circuit has articulated a three-step
inquiry to determine whether specific jurisdiction exists.
Seiferth, 472 F.3d at 271. First, the plaintiff must
show that “the defendant has minimum contacts with the
forum state, i.e., . . . it purposely directed its
activities toward the forum state or purposefully availed
itself of the privileges of conducting activities
there.” Id. Second, the plaintiff must show
that his “cause of action arises out of or results from
the defendant's forum-related contacts.”
Id. If the plaintiff makes these showings,
“the burden shifts to the defendant to defeat
jurisdiction by showing that its exercise would be unfair or
unreasonable.” Id.
When
the district court rules on a motion to dismiss for lack of
personal jurisdiction without an evidentiary hearing, the
“uncontroverted allegations in the plaintiff's
complaint must be taken as true, and conflicts between the
facts contained in the parties' affidavits must be
resolved in the plaintiff's favor.” Johnston v.
Multidata Sys. Int'l Corp., 523 F.3d 602, 609 (5th
Cir. 2008). But the district court is not required “to
credit conclusory allegations, even if uncontroverted.”
Panda Brandywine Corp. v. Potomac Elec. Power Co.,
253 F.3d 865, 869 (5th Cir. 2001).
III.
DISCUSSION
Defendant
argues that the Court must dismiss plaintiff's claims
because this Court does not have personal jurisdiction over
the defendant.[28]
The
Court may adjudicate plaintiff's claims if it has either
general or specific jurisdiction over the defendant.
Plaintiff does not argue that the Court has general
jurisdiction, and the Court finds that it does not. General
jurisdiction over a non-resident defendant exists only if the
defendant's “affiliations with the State are so
‘continuous and systematic' as to render them
essentially at home in the forum State.”
Goodyear, 564 U.S. at 919. Hibbard Inshore's
state of incorporation and its principal place of business
are both Michigan.[29] There is no evidence that the company
has a connection to Louisiana other than the work done by
plaintiff in Louisiana. Thus, there is no showing that
Hibbard Inshore is subject to general personal jurisdiction
here. See Monkton Ins. Servs., Ltd. v. Ritter, 768
F.3d 429, 432 (5th Cir. 2014) (noting that for a corporation,
“[i]t is . . . incredibly difficult to establish
general jurisdiction in a forum other than the place of
incorporation or principal place of business”).
Turning
to specific jurisdiction, plaintiff has the burden of first
making a prima facie showing that defendant has
purposefully availed itself of the privilege of conducting
activities in the state of Louisiana such that it invoked the
benefits and protection of that state's laws and created
minimum contacts. Seiferth, 472 F.3d at 271. Second,
plaintiff must show that his cause of action is related to
defendant's contact with the forum. Id. To
determine whether a business has the necessary minimum
contacts, courts look at many factors, including: (1) whether
the defendant has a physical presence in the state, (2)
whether the defendant conducts business in the state, (3)
whether the contract underlying the business transaction at
issue was signed in the state, and (4) whether the contract
at issue called for performance in the state. Monkton
Ins. Servs., 768 F.3d at 433.
But it
is well-settled that an employee's personal contacts with
a forum are not automatically attributed to their employer.
Burger King Corp. v. Rudzewicz, 471 U.S. 462, 478
(1985). “The unilateral activity of those who claim
some relationship with a nonresident defendant cannot satisfy
the requirement of contact with the forum State.”
Id. at 474; Walden v. Fiore, 571 U.S. 277,
285 (2014) (holding that the “minimum contacts analysis
looks to the defendant's contacts with the forum State
itself, not the defendant's contacts with persons who
reside there” (internal quotation marks omitted)). The
unilateral actions of an employee do not create minimum
contacts in a forum for his employer unless there is evidence
that the employer purposefully availed itself of the benefits
and protections of the laws of the forum. In other words,
“the plaintiff cannot be the only link between the
defendant and the forum.” Id.
Here,
there is no evidence that Hibbard Inshore, as opposed to the
plaintiff, created minimum contacts with the state of
Louisiana. Plaintiff has submitted an affidavit attesting to
the following facts in support of the Court's
jurisdiction over the defendant: (1) plaintiff informed
defendant when he was hired that in the future he intended to
work at least partly from Louisiana; (2) he made and received
both sales calls to potential clients and project update
calls with existing clients from his residence in New
Orleans; (3) he often took business trips in and out of the
New Orleans airport, which he alleges saved the defendant
money because New Orleans was closer to his destinations than
Michigan, where Hibbard Inshore's office is located, or
Pennsylvania, where he lived when he was not in New Orleans;
(4) he attended trade shows, conferences, and business
meetings in New Orleans; (5) he took clients to dinner in New
Orleans when they were in the city; (6) he once retained a
New Orleans-based translator to work on a project for
defendant and paid her on behalf of defendant in New Orleans;
(7) he solicited clients in the southeastern United States
and used his location in New Orleans as a selling point; (8)
he purchased office supplies and sent packages via
Hibbard's Fedex account in New Orleans; (9) he received
packages, stored marketing materials, and used a computer
owned by defendant in his New Orleans home.[30] Plaintiff
also points to a nondisclosure agreement that he signed in
2014, which states that all business materials had to remain
on defendant's property. Plaintiff argues that this
contractual language indicates that defendant considered
plaintiff's home office in New Orleans company
property.[31]
These
facts demonstrate a relationship between plaintiff and the
state of Louisiana, but they do not show that defendant
purposely directed its activities toward the state or
purposefully availed itself of the privileges of conducting
activities here. While plaintiff worked partly from Louisiana
for the second two years of his employment, he did so of his
own volition and not at the direction of the defendant.
Defendant attests that it has never been licensed or
authorized to conduct business in Louisiana, and that it has
never leased, rented, or owned property in
Louisiana.[32] Plaintiff presents no evidence
contradicting these statements. Plaintiff's assertion
that his home became the defendant's office based on the
terms of the nondisclosure agreement is unavailing. There is
no evidence that defendant leased or owned the space. A
nondisclosure agreement does not transform the
plaintiff's personally-owned residence into his
employer's office absent any intent or financial
contribution by the employer. With regard to Hibbard
Inshore's business activities, plaintiff does not allege
that Hibbard ever directed him to reach out to potential
clients in Louisiana or that it hoped to target businesses in
the state. Indeed, plaintiff does not name even one client of
defendant's domiciled in Louisiana. As evidence of
defendant's work in Louisiana, plaintiff points to
leveraging his proximity to potential clients based in
Savannah, Georgia and Houston, Texas.[33] Connections
to these businesses in other states do not establish a
connection to Louisiana.
Further,
plaintiff has not shown precisely how much time he spent in
Louisiana from 2016-2018. Plaintiff traveled frequently for
work, [34] and his clients appear to have been
based on the East and West Coasts.[35] Plaintiff's job
entailed “flying to the location of the customer and
developing the sale at the location of the
client.”[36] That plaintiff's frequent travel
reduced the amount of time he worked from New Orleans, that
his work occurred mostly at client sites, and that defendant
did not assign him to a particular base of operations suggest
that defendant was agnostic as to where plaintiff spent his
time while he was not traveling. Indeed, defendant represents
that plaintiff was hired to develop business on the East and
West Coasts.[37]Plaintiff's representation that he
did a majority of his work from New Orleans is also
undermined by a communication indicating that his pay stub
did not reflect a New Orleans address until after April 30,
2018, [38] and by his decision to apply for
unemployment in Pennsylvania immediately after his
termination.[39] Having one ...