Brotz v. Simm Associates, Inc.
Filing
50
ORDER denying 25 Defendant's Motion to Dismiss. Defendant SHALL answer the Amended Complaint no later than fourteen (14) days from the date of this Order. Signed by Judge Paul G. Byron on 10/15/2018. (JRJ)
UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
ORLANDO DIVISION
JOYCE LORRAINE BROTZ,
Plaintiff,
v.
Case No: 6:17-cv-1603-Orl-40TBS
SIMM ASSOCIATES, INC.,
Defendant.
/
ORDER
This cause comes before the Court without oral argument on Defendant’s Motion
to Dismiss for Lack of Personal Jurisdiction (Doc. 25 (the “Motion”)), filed March 26, 2018,
and Plaintiff’s Response in Opposition (Doc. 26), filed April 9, 2018. Upon consideration,
the Motion is due to be denied.
I.
BACKGROUND
Joyce Lorraine Brotz brings this putative class action suit against Defendant, Simm
Associates, Inc. (“SAI”), alleging unlawful debt collection activities. On or about Augus t
16, 2007, Ms. Brotz and her son William Brotz defaulted on their student loan payments
to the National Collegiate Loan Trust. (Doc. 1, ¶ 14). The debt was then transferred to
SAI, a debt collector. (Id. ¶¶ 5–6, 15). Ms. Brotz agreed to repay the loan in monthly
installments to SAI and authorized SAI to withdraw payments from her checking account
via ACH electronic transfer. (Id. ¶ 22). SAI also withdrew a “convenience fee” and credit
card payment fee from Ms. Brotz’s checking account that the loan agreement did not
authorize. (Id. ¶¶ 23–24).
1
Plaintiff therefore brought this action individually and on behalf of a nationwide
class alleging that SAI charges consumers excessive fees that are neither authorized by
contract nor permitted by law. (Id. ¶¶ 43–44). The Complaint brings claims for Fair Debt
Collection Practice Act violations, 15 U.S.C. § 1692 et seq., Florida Consumer Collection
Practices Act violations, Fla. Stat. § 559.55 et seq., breach of contract, and unjust
enrichment. These claims are brought pursuant to Federal Rule of Civil Procedure 23 on
behalf of Plaintiff and four (4) subclasses. (Id. ¶ 44).
SAI moves to dismiss asserting that personal jurisdiction over claims by out-ofstate putative class members is improper based on the Supreme Court decision in BristolMyers Squibb Co. v. Superior Court, 137 S. Ct. 1773 (2017). See also (Doc. 25, p. 4).
Ms. Brotz opposes, contending Bristol-Myers is not controlling. (Doc. 26, p. 1).
II.
STANDARD OF REVIEW
A court must dismiss an action against a defendant over which it lacks personal
jurisdiction. Smith v. Trans-Siberian Orchestra, 689 F. Supp. 2d 1310, 1312 (M.D. Fla.
2010). A plaintiff bringing suit against a nonresident defendant must allege “sufficient facts
to make out a prima facie case of jurisdiction.” United Techs. Corp. v. Mazer, 556 F.3d
1260, 1274 (11th Cir. 2009). The Court must accept the allegations in the complaint as
true where they are uncontroverted by the defendant’s affidavits and resolve all
reasonable inferences in the plaintiff’s favor. Consol. Dev. Corp. v. Sherritt, Inc., 216 F.3d
1286, 1291 (11th Cir. 2000). “The plaintiff bears the burden of proving ‘by affidavit the
basis upon which jurisdiction may be obtained’ only if the defendant challenging
jurisdiction files ‘affidavits in support of his position.’” Posner v. Essex Ins. Co., 178 F.3d
2
1209, 1214 (11th Cir. 1999) (quoting Venetian Salami Co. v. Parthenais, 554 So. 2d 499,
502 (Fla. 1989)).
III.
DISCUSSION
Bristol-Myers was a mass tort action brought in California state court by “[a] group
of plaintiffs—consisting of 86 California residents and 592 residents from 33 other
states”—for injuries allegedly stemming from a drug manufactured by Bristol-Myers
Squibb (“BMS”). 137 S. Ct. at 1778. BMS challenged the court’s specific jurisdiction over
the non-California-resident plaintiffs’ claims arising outside California. Id. at 1777–80,
1782. Applying “settled principles regarding specific jurisdiction,” the Supreme Court
found that the California state court’s exercise of personal jurisdiction over the nonCalifornia-resident claims violated the Due Process Clause of the Fourteenth Amendment
because there was no “connection between the forum and the [non-residents’] specific
claims.” Id. at 1781. The Court, however, expressly declined to address “the question
whether its opinion . . . would also apply to a class action in which a plaintiff injured in the
forum State seeks to represent a nationwide class of plaintiffs, not all of whom were
injured there.” Id. at 1789 n.4 (Sotomayor, J., dissenting).
Defendant asserts that the Bristol-Myers holding requires dismissal of the claims
of non-Florida-resident putative class members in this action. In its motion, Defendant
supports its argument by citing six cases from district courts in Arizona, New York,
Missouri, and Illinois applying Bristol-Myers. (Doc. 25, pp. 5–6). 1 Defendant represents
1
Defendant cites the following cases: Practice Mgmt. Support Servs. v. Cirque Du
Soleil, Inc., 301 F. Supp. 3d 840 (N.D. Ill. 2018); DeBernardis v. NBTY, Inc., No. 17 C
6125, 2018 WL 461228 (N.D. Ill. Jan. 18, 2018); Greene v. Mizuho Bank, Ltd., 289 F.
Supp. 3d 870 (N.D. Ill. 2017); Wenokur v. AXA Equitable Life Ins. Co., No. CV-1700165, 2017 WL 4357916 (D. Ariz. Oct. 2, 2017); Spratley v. FCA US LLC, No. 3:12-
3
that “courts throughout the country have determined that personal jurisdiction cannot be
maintained over non-resident class claims against a defendant who is not subject to
general personal jurisdiction in the subject forum.” 2 (Doc. 25, p. 5).
Interestingly, Defendant’s brief fails to mention a single decision, of which there
are numerous, holding that Bristol-Myers does not apply in the class action context. 3
Indeed, Defendant only tells half the story, which is unfortunate since the other half is
more compelling. Since Bristol-Myers was decided, numerous district courts faced with
CV-0062, 2017 WL 4023348 (N.D.N.Y. Sept. 12, 2017); Jordan v. Bayer Corp., No.
4:17-CV-865, 2017 WL 3006993 (E.D. Mo. July 14, 2017).
2
The cited cases barely support Defendant’s proposition—that a district court lacks
specific personal jurisdiction over a defendant with respect to claims lodged by
putative class members residing outside the forum state. Indeed, in Spratley, the
Northern District of New York invoked Bristol-Myers in support of the court’s holding
that it lacked personal jurisdiction over six out-of-state named plaintiffs. 2017 WL
4023348, at *6–7. Likewise, the suit in Jordan was a mass tort, not a class action, and
Bristol-Myers was applied in that case to support the court’s finding that “there [was]
no personal jurisdiction as to the claims of the [named] non-Missouri plaintiffs . . . .”
2017 WL 3006993, at *2, 4. Furthermore, the personal jurisdiction analysis in Wenokur
was limited to a cursory footnote stating, in dicta, that the court lacked personal
jurisdiction over claims asserted by out-of-forum class members. 2017 WL 4357916,
at *4 n.4.
The Northern District of Illinois decisions lend Defendant’s argument support, though
even those decisions stand on shaky ground. See Debernardis, 2018 WL 461228 at
*2 (“The Court believes that it is more likely than not based on the Supreme Court's
comments about federalism that the courts will apply Bristol-Myers Squibb to outlaw
nationwide class actions in a form, such as in this case, where there is no general
jurisdiction over the Defendants.” (emphasis added)); Greene, 289 F. Supp. 3d at
871–72, 874 (applying Bristol-Myers to dismiss claims by out-of-forum “named
plaintiffs in a putative class action” for lack of personal jurisdiction (emphasis added));
but see Cirque Du Soleil, 301 F. Supp. 3d at 860–62 (applying Bristol-Myers holding
to “dismiss the claims of [out-of-forum] putative class members”).
3
“[T]here is a split of authority regarding whether Bristol–Myers should be read to hold
a district court in Florida lacks personal jurisdiction as to the claims of non–Florida
putative class members.” Becker v. HBN Media, Inc., 314 F. Supp. 3d 1342, 1344
(S.D. Fla. 2018).
4
Rule 12(b)(2) motions have found that Bristol-Myers’ holding does not apply to out-offorum putative class members’ claims. For instance, the U.S. District Court for the District
of Columbia recently held that “Bristol-Myers does not apply to class actions” because of
the “material distinctions between a class action and a mass tort action.” Molock v. Whole
Foods Market, Inc., 297 F. Supp. 3d 114, 126–27 (D.D.C. 2018). The well-reasoned
Molock opinion summarizes the rationale for limiting the Bristol-Myers holding to the mass
action context as follows:
[I]n a mass tort action, each plaintiff is a real party in interest to the
complaints; by contrast, in a putative class action, one or more plaintiffs
seek to represent the rest of the similarly situated plaintiffs, and the named
plaintiffs are the only plaintiffs actually named in the complaint. Additionally,
unlike a mass tort action, for a case to qualify for class action treatment, it
needs to meet the additional due process standards for class certification
under Rule 23—numerosity, commonality, typicality, adequacy of
representation, predominance and superiority. These additional elements
of a class action supply due process safeguards not applicable in the mass
tort context.
Id. (citations and quotation marks omitted). Ultimately, the Court finds the reasoning of
the cases Defendant neglected to cite compelling and that Bristol-Myers is inapplicable
here. See also, e.g., Tickling Keys, Inc. v. Transamerica Fin. Advisors, Inc., 305 F. Supp.
3d 1342, 1350–51 (M.D. Fla. 2018) (“[T]he Court declines to extend Bristol-Myers to the
class action context.”); Sanchez v. Launch Tech. Workforce Sols., LLC, 297 F. Supp. 3d
1360, 1363–69 (N.D. Ga. 2018) (concluding that the Bristol-Myers holding does “not
foreclose [the court’s] exercise of personal jurisdiction over [the defendant] as to the
claims of . . . the unnamed non-resident plaintiffs”); Fitzhenry-Russell v. Dr. Pepper
Snapple Grp., No. 17-cv-564, 2017 WL 4224723, at *5 (N.D. Cal. Sept. 22, 2017) (“[T]he
Court is not persuaded to extend Bristol-Myers to the class action context . . . .”); In re
Chinese-Manufactured Drywall Prods. Liab. Litig., Civil Action MDL No. 09-2047, 2017
5
WL 5971622, at *8–20 (E.D. La. Nov. 30, 2017) (“[Bristol-Myers] does not speak to or
alter class action jurisprudence.”). 4
While Defendant’s omission does not technically violate Florida’s ethical rules—
which require the disclosure of binding caselaw directly adverse to the advocated
position—the Court takes notice of defense counsel’s lack of candor. See Fla. R. of Prof.
Conduct 4-3-3; Malautea v. Suzuki, 987 F.2d 1536, 1546 (“All attorneys, as ‘officers of
the court,’ owe duties of complete candor and primary loyalty to the court before which
they practice.”). 5 Defense counsel is reminded that the “duty to a client can never
outweigh his or her responsibility to see that our system of justice functions smoothly.”
Malautea, 987 F.2d at 1546.
IV.
CONCLUSION
For the foregoing reasons, it is ORDERED AND ADJUDGED as follows:
1.
Defendant’s Motion to Dismiss for Lack of Personal Jurisdiction (Doc. 25) is
DENIED.
2.
Defendant SHALL answer the Amended Complaint no later than fourteen (14)
days from the date of this Order.
4
Although no decisions in this District had addressed this precise issue before
Defendant’s Motion to Dismiss (Doc. 25) was filed, numerous district courts across
the country had entered decisions contradicting Defendant’s interpretation of BristolMyers by then.
5
The Court must also note that the denial of Defendant’s motion for leave to reply to
Plaintiff’s response brief does not excuse Defendant’s omission. To be sure, the
adversarial process is designed to protect and advance the interests of each party,
and Plaintiff’s counsel briefed the cases that Defendant ignored. (See Doc. 26).
Nevertheless, Defendant cannot shirk its duty of candor based on the assumption that
the other side will invariably inform the Court of adverse legal authority.
6
DONE AND ORDERED in Orlando, Florida on October 15, 2018.
Copies furnished to:
Counsel of Record
Unrepresented Parties
7
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