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Gallagher v. Maternitywise International, LLC

United States District Court, D. Hawaii

February 27, 2019

DANNY GALLAGHER, Plaintiff,
v.
MATERNITYWISE INTERNATIONAL, LLC, ANNE CROUDACE, ELIZBETH ANOATUBBY, EMILEE SALDAYA, RACHAEL BROWN, JENNA CHIDESTER, STEPHANIE GILBERT, JORDAN ASHLE HOCKER, BETHANY KIRILLOVA, SAMANTHA LAJOIE, AERIN LUND, KATE PAVLOVSKY, CHANNA JAYDE WALZ, MADDISON WEIKLE, ESME WHRITENOUR, NICOLETTE RAYMOND, ELIZABETH GEFTAKYS, JULIE BELL, CARA GWIZD, HOLLY LEPPARD-WESTHAVER, ELOISE VICTORIA, JANE DOE ONE, JANE DOE TWO, JANE DOE THREE, DOES 1-10, INCLUSIVE; Defendants.

          ORDER GRANTING IN PART AND DENYING IN PART: 1) DEFENDANTS' MOTION TO DISMISS PLAINTIFF'S SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL; 2) DEFENDANT LUND'S JOINDER; AND 3) DEFENDANT SALDAYA'S JOINDER

          Leslie E. Kobayashi, United States District Judge.

         On December 14, 2018, Specially Appearing Defendants MaternityWise International, LLC (“MaternityWise”), Christy Anne Croudace (“Croudace”), Jane Hopaki (“Hopaki”), Stephanie Byers (“Byers”), Bethany Ellen Kirillov (“Kirillov”), Kate Pavlovsky (“Pavlovsky”), and Madison Sisley Boulter (“Boulter” and collectively “MaternityWise Defendants”), [1] filed their Motion to Dismiss Plaintiff's Second Amended Complaint for Damages and Demand for Jury Trial (“Motion”). [Dkt. no. 49.] On December 19, 2018, Specially Appearing Defendant Aerin Lund (“Lund”) filed her joinder of simple agreement to the Motion, and on December 28, 2018, Specially Appearing Defendant Emilee Saldaya (“Saldaya”) filed her joinder of simple agreement to the Motion (“the Joinders”). [Dkt. nos. 52, 55.] Plaintiff Danny Gallagher (“Plaintiff”) filed his memorandum in opposition on January 4, 2019, and the MaternityWise Defendants filed their reply on January 11, 2018.[2] [Dkt. nos. 57, 60.] These matters came on for hearing on January 25, 2019. The MaternityWise Defendants' Motion and the Joinders are hereby granted in part and denied in part as this Court does not have personal jurisdiction over the parties other than MaternityWise, Croudace, and Boulter. The dismissal is without prejudice and Plaintiff has leave to amend.

         The instant action involves various claims, including those for defamation, as a result of comments about Plaintiff which were made on social media; specifically Facebook. Due to the global reach of this popular social networking website, individuals sued in this matter apparently reside in various places throughout the United States as well as other countries. At the heart of the Motion is this issue: where the acts alleged as the basis for the cause of actions occurred in cyberspace, can personal jurisdiction ever exist?

         BACKGROUND

         Plaintiff filed his original complaint on September 25, 2018 based on diversity jurisdiction. [Dkt. no. 1.] The operative pleading relevant to the issues at hand is Plaintiff's Second Amended Complaint for Damages and Demand for Jury Trial (“Second Amended Complaint”) filed on October 4, 2018, in which the defendants are the MaternityWise Defendants, Saldaya, Lund, Rachel Brown (“Brown”), Jenna Chidester (“Chidester”), Jordan Ashley Hocker (“Hocker”), Samantha Lajoie (“Lajoie”), Channa Jayde Walz (“Walz”), Esme Whritenour (“Whritenour”), Nicolette Raymond (“Raymond”), Elizabeth Geftakys (“Geftakys”), Julie Bell (“Bell”), Cara Gwizd (“Gwizd”), Holly Leppard-Westhaver (“Leppard-Westhaver”), Eloise Victoria (“Victoria” and collectively “Defendants”).[3] [Dkt. no. 33.]

         According to the Second Amended Complaint, Plaintiff is a resident of the State of Hawai`i, and MaternityWise is a limited liability company that “acquir[ed] its charter under the laws” of New York, with its principal place of business in Texas. [Id. at ¶¶ 3-4.] Croudace is a citizen of Texas, and is the principal of MaternityWise. [Id. at ¶¶ 5, 36.] Plaintiff alleges all other named defendants are not citizens of the State of Hawai`i, and some are not citizens of the United States. [Id. at pgs. 3-5.] The gravamen of Plaintiff's claims is that Defendants have all made defamatory statements about Plaintiff via social media, which have gone “viral.” [Id.] As a result, he has been irreparably harmed. [Id. at ¶ 33.]

         The allegations pertinent to the Motion at hand are that: MaternityWise provides a doula training and certification program in exchange for a fee; Croudace is certified through MaternityWise to train prospective doulas; Croudace and MaternityWise use Facebook and various social media discussion groups to market the MaternityWise program to every state and country - including the State of Hawai`i - to find both clients and students; some of the doula training workshops are marketed towards, and held in Hawai`i; and Plaintiff obtained his doula certification through a MaternityWise training workshop held in Hawai`i. [Id. at ¶¶ 34, 39, 40-42.]

         As to the alleged defamation, Plaintiff's claims center on two sources of defamation - first, a “Memorandum of Official Statement” dated June 5, 2018 (“MaternityWise Memorandum”) sent by Croudace, in which Plaintiff was accused of violating the ethical and professional standards of his profession as a photographer and doula; and, second, comments posted on Plaintiff's Facebook page, in which he is accused of rape, attempted murder, sexual exploitation, prostitution, “pimping, ” and/or sexual harassment. [Id. at ¶ 120.]

         In the Motion, the MaternityWise Defendants seek dismissal of Plaintiff's Second Amended Complaint for lack of personal jurisdiction, improper venue, and failure to properly serve the Second Amended Complaint upon the MaternityWise Defendants but do not specify whether dismissal should be made with or without prejudice.

         DISCUSSION

         I. Personal Jurisdiction

         In considering a motion brought under Fed.R.Civ.P. 12(b)(2) for lack of personal jurisdiction, this Court has stated:

A plaintiff has the burden of establishing personal jurisdiction over a nonresident defendant. See Love v. Associated Newspapers, Ltd., 611 F.3d 601, 608 (9th Cir. 2010); Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004). A plaintiff must establish personal jurisdiction over a defendant with respect to each claim. Action Embroidery Corp. v. Atl. Embroidery, Inc., 368 F.3d 1174, 1180 (9th Cir. 2004) (“Personal jurisdiction must exist for each claim asserted against a defendant.” (citing Data Disc, Inc. v. Sys. Tech. Assocs., Inc., 557 F.2d 1280, 1289 n.8 (9th Cir. 1977))).
When, as here, a district court acts on a motion to dismiss without holding an evidentiary hearing, a plaintiff need only make a prima facie showing of jurisdictional facts to withstand the motion to dismiss. Love, 611 F.3d at 608; Schwarzenegger, 374 F.3d at 800. Although a plaintiff may not simply rest on the bare allegations of the complaint, uncontroverted allegations in the complaint must be taken as true, and conflicts between parties over statements contained in affidavits or declarations must be resolved in the plaintiff's favor. See Love, 611 F.3d at 608; Schwarzenegger, 374 F.3d at 800.

Barranco v. 3D Sys. Corp., 6 F.Supp.3d 1068, 1076 (D. Hawai`i 2014) (some citations omitted).

The district court considers two factors before exercising personal jurisdiction over a nonresident defendant in a diversity of citizenship case: “(1) whether an applicable state rule or statute potentially confers jurisdiction over the defendant; and (2) whether assertion of such jurisdiction accords with constitutional principles of due process.” Flynt Distrib. Co. v. Harvey, 734 F.2d 1389, 1392 (9th Cir. 1984). “The jurisdictional inquiries under state law and federal due process merge into one analysis” when, as here, the state's long-arm statute is “coextensive with federal due process requirements.” Roth v. Garcia Marquez, 942 F.2d 617, 620 (9th Cir. 1991). See Cowan v. First Ins. Co. of Hawaii, 61 Haw. 644, 649, 608 P.2d 394, 399 (1980) (Hawaii's long-arm statute, Haw. Rev. Stat. § 634-35, was adopted to expand the jurisdiction of Hawaii's courts to the extent permitted by the due process clause of the Fourteenth Amendment). . . .
The Due Process Clause protects a person's “liberty interest in not being subject to the binding judgments of a forum with which he has established no meaningful ‘contacts, ties, or relations.'” Burger King Corp. v. Rudzewicz, 471 U.S. 462, 471-72 (1985) (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 319 (1945)). The Due Process Clause requires that defendants have “certain minimum contacts with [Hawaii] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Int'l Shoe, 326 U.S. at 316; Data Disc, Inc. v. Systems Tech. Assocs., Inc., 557 F.2d 1280, 1287 (9th Cir. 1977). The minimum contacts required mean that the defendant must have purposefully availed itself of the privilege of conducting activities within the foreign jurisdiction, thereby invoking the benefits and protections of the foreign jurisdiction's laws. See Asahi Metal Indus. Co. v. Sup. Court of Cal., 480 U.S. 102, 109 (1987). In applying Due Process Clause requirements, courts have created two jurisdictional concepts-general and specific jurisdiction.
A court may exercise general jurisdiction over the defendant when the defendant is a resident or domiciliary of the forum state, or the defendant's contacts with the forum state are continuous, systematic, and substantial. Helicopteros Nacionales de Columbia, S.A. v. Hall, 466 U.S. 408, 414-16 [104 S.Ct. 1868');">104 S.Ct. 1868, 80 L.Ed.2d 404 (1984)]; Data Disc, 557 F.2d at 1287. . . .
. . . .
Specific jurisdiction, on the other hand, may be found when the cause of action arises out of the defendant's contact or activities in the forum state. See Roth v. Garcia Marquez, 942 F.2d 617, 620 (9th Cir. 1991); Data Disc, 557 F.2d at 1287. . . .

Id. at 1077-78 (some alterations in Barranco) (some citations omitted). Moreover, Plaintiff must demonstrate that the Court has personal jurisdiction over each of the defendants. See Rush v. Savchuk, 444 U.S. 320, 332 (1980) (“The requirements of International Shoe, however, must be met as to each defendant over whom a state court exercises jurisdiction.”).

         A. General Jurisdiction

         “For an individual, the paradigm forum for the exercise of general jurisdiction is the individual's domicile; for a corporation, it is an equivalent place, one in which the corporation is fairly regarded as at home.” Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 924 (2011) (citation omitted). Plaintiff argues this Court has general jurisdiction over MaternityWise and Croudace because they conduct business, advertise, and hold trainings in Hawai`i, and are thus essentially present in the forum. [Mem. in Opp. at 7; Second Amended Complaint at ¶¶ 39-44.] The MaternityWise Defendants argue MaternityWise's certification trainings occur in Hawai`i approximately once a year, and the last training held in Hawai`i was conducted from April 25 to April 28, 2018. [Reply, Decl. Kevin A. Yolken (“Yolken Decl.”), at ¶ 6.[4]

         Although MaternityWise conducts some of its trainings in the forum and advertises its workshops in Hawai`i, Plaintiff has not shown that general jurisdiction exists. First, Plaintiff alleges MaternityWise advertises its business to “residents of every state and country, ” in addition to Hawai`i. [Second Amended Complaint at ¶ 39.] Second, Plaintiff's Exhibit 15 demonstrates that MaternityWise offers doula training not only in Hawai`i, but also Illinois, Florida, California, Minnesota, Maryland, South Carolina, Atlanta, Texas, and New York, [Decl. of Danny Gallagher in supp. of mem. in opp. (“Gallagher Decl.”), filed 1/4/19 (dkt. no. 58), Exh. 15 (screenshot of www.maternitywise.com), ] and appears to permit website users to “request more doula trainings” for the rest of the United States, including Washington D.C. and the Virgin Islands. [Gallagher Decl., Exh. 18 (screenshot of www.maternitywise.com/doulatrainingdates).] It can hardly be said that MaternityWise is “at home” in Hawai`i, when it conducts business and advertises its workshops across the United States.[5] See Daimler AG v. Bauman, 571 U.S. 117, 139 n.20 (2014) (“General jurisdiction [] calls for an appraisal of a corporation's activities in their entirety, nationwide and worldwide. A corporation that operates in many places can scarcely be deemed at home in all of them.”); see also Goodyear, 564 U.S. at 919 (“A court may assert general jurisdiction over foreign (sister-state or foreign-country) corporations to hear any and all claims against them when their affiliations with the State are so ‘continuous and systematic' as to render them essentially at home in the forum State.” (quoting International Shoe, 326 U.S. at 317)). Accordingly, the Court finds that it does not have general jurisdiction over MaternityWise.

         With regard to Croudace, the primary focus is her domicile. See Daimler, 571 U.S. at 137. Plaintiff alleges Croudace is domiciled in, and is a citizen of Texas, see Second Amended Complaint at ¶ 5, while the MaternityWise Defendants assert Croudace resides in New York. See Reply at 5; Yolken Decl. at ¶ 3. In any case, neither assertion indicates that Croudace is domiciled in Hawai`i, therefore the Court finds general jurisdiction over Croudace is not appropriate in Hawai`i.

         B. Specific Jurisdiction

         In the alternative, Plaintiff argues this Court has specific jurisdiction over all Defendants. The Ninth Circuit applies the following three-part test to determine whether personal jurisdiction exists:

(1) The non-resident defendant must purposefully direct his activities or consummate some transaction with the forum or resident thereof; or perform some act by which he purposefully avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws;
(2) the claim must be one which arises out of or relates to the defendant's forum-related activities; and
(3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e. it must be reasonable.
Lake v. Lake, 817 F.2d 1416, 1421 (9th Cir. 1987). The plaintiff bears the burden of satisfying the first two prongs of the test. Sher [v. Johnson], 911 F.2d [1357, ] 1361 [(9th Cir. 1990)]. If the plaintiff fails to satisfy either of these prongs, personal jurisdiction is not established in the forum state. If the plaintiff succeeds in satisfying both of the first two prongs, the burden then shifts to the defendant to “present a compelling case” that the exercise of jurisdiction would not be reasonable. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476-78, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985). . . .

Schwarzenegger, 374 F.3d at 802. With regard to the first prong of the specific jurisdiction test, the Ninth Circuit generally looks to a party's “purposeful direction” for actions sounding in tort, and “purposeful availment” for actions sounding in contract. See id. at 802-03. In evaluating purposeful direction, the Ninth Circuit uses a three-part “effects” test derived from the United States Supreme Court's decision in Calder v. Jones, 465 U.S. 783 (1984).[6]See Dole Food Co. v. Watts, 303 F.3d 1104, 1111 (9th Cir. 2002). “[T]he Calder ‘effects' test requires that the defendant allegedly have (1) committed an intentional ...


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