Multisports USA, Inc. v. The Hut Group Limited
ORDER ON DEFENDANTS' MOTION TO DISMISS granting 30 Motion to Dismiss for Lack of Jurisdiction; granting 30 Motion to Dismiss for Failure to State a Claim. Closing Case. Motions Terminated: 30 Defendant's MOTION to Dismiss fo r Lack of Jurisdiction 18 Amended Complaint Defendant's MOTION TO DISMISS 18 Amended Complaint FOR FAILURE TO STATE A CLAIM filed by The Hut.com Limited, Mama Mio US, Inc.. Signed by Judge Marcia G. Cooke on 12/21/20 16. (tm) NOTICE: If there are sealed documents in this case, they may be unsealed after 1 year or as directed by Court Order, unless they have been designated to be permanently sealed. See Local Rule 5.4 and Administrative Order 2014-69.
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF FLORIDA
Case No. 16-20960-Civ-COOKE/TORRES
a Florida corporation,
THEHUT.COM LIMITED, a foreign
company, and MAMA MIO US, INC.,
a Delaware company,
ORDER ON DEFENDANTS’ MOTION TO DISMISS
Plaintiff Multisports USA (“Plaintiff” or “Multisports”) initiated a diversity action
against The Hut Group Limited d/b/a ProBikeKit, alleging tortious interference and unjust
enrichment. Plaintiff sought leave to amend its Complaint and subsequently filed its
Amended Complaint (ECF No. 18) against TheHut.com Limited and Mama Mio US, Inc.
(collectively the “Defendants”), claiming tortious interference against each of the new
named Defendants. In response, Defendants filed a Motion to Dismiss Plaintiff's Amended
Complaint (“Motion”) (ECF No. 30), arguing that Plaintiff's Amended Complaint should
be dismissed for, inter alia, lack of subject matter jurisdiction and improper service of
process. Plaintiff filed its Response to Defendants’ Motion (“Response”) (ECF No. 32), to
which Defendants filed their Reply to Plaintiff’s Response (“Reply”) (ECF No. 33). After
reviewing Defendants’ Motion, the Response and Reply thereto, the record, and relevant
legal authorities, I grant Defendants’ Motion for the reasons below.
Plaintiff entered into an exclusive distribution agreement (the “Agreement”) with
Compressport, a nonparty to this litigation, for the distribution of sports compression
merchandise in the United States. Amended Compl. ¶ 7, ECF No. 18. Plaintiff contends
that Defendants interfered with its business relationship with Compressport. Id. ¶ 10. As a
result of Defendants’ conduct, Plaintiff claims to have suffered damages for lost sales and
termination of its distribution agreement with Compressport worth in excess of $3 million.
Id. ¶ 20.
Defendants seek to dismiss the complaint for insufficient service of process pursuant
to Federal Rule of Civil Procedure (“Rule”) 12(b)(5). “The defendant has the initial burden
of challenging the sufficiency of service and must describe with specificity how the service of
process failed to meet the procedural requirements of [Fed. R. Civ. P. 4].” Int’l Imps., Inc. v.
Int’l Spirits & Wines, LLC, No. 10-61856-CIV, 2011 WL 7807548, at *3 (S.D. Fla. July 26,
2011) (quotation marks and citation omitted). “The burden then shifts to the plaintiff to
prove a prima facie case of proper service of process.” Id. If the plaintiff establishes that
service was proper, “the burden shifts back to the defendant to bring strong and convincing
evidence of insufficient process.” Id.
Defendants also challenge the Plaintiff’s ability to bring the instant action pursuant to
Rule 12(b)(1). Under Rule 12(b)(1), a complaint may be dismissed when it is determined
that the court lacks subject matter jurisdiction. See Fed. R. Civ. P. 12(b)(1). “[B]ecause a
federal court is powerless to act beyond its statutory grant of subject matter jurisdiction, a
court must zealously insure that jurisdiction exists over a case . . . .” Smith v. GTE Corp., 236
F.3d 1292, 1299 (11th Cir. 2001). Thus, “when a defendant properly challenges subject
matter jurisdiction under Rule 12(b)(1) the district court is free to independently weigh facts,
and may proceed as it never could under Rule 12(b)(6) or Fed. R. Civ. P. 56.” Morrison v.
Amway Corp., 323 F.3d 920, 925 (11th Cir. 2003) (quoting Lawrence v. Dunbar, 919 F.2d
1525, 1529 (11th Cir. 1990)).
A. Insufficient Service of Process on Foreign Defendant
The first issue I must determine is whether service upon Defendant TheHut.com
Limited, a United Kingdom-based corporation, was proper under Rule 4(f) and the Hague
Convention on Service Abroad of Judicial and Extrajudicial Documents (“Hague Service
Convention”), Nov. 15, 1965, 20 U.S.T. 361, T.I.A.S. No. 6638.1
Under Rule 4(f), there are “three methods for serving an individual in a foreign
country: (1) by internationally agreed means, such as those authorized by the [Hague
Service Convention]; (2) by a method that is reasonably calculated to give notice; or (3) by
other means committed to a court’s discretion that are not prohibited by international
agreement.” TracFone Wireless, Inc. v. Hernandez, 126 F. Supp. 3d 1357, 1359 (S.D. Fla.
2015); see also Barriere v. Juluca, No. 12-23510-CIV, 2014 WL 652831, at *1 – 2 (S.D. Fla.
Feb. 19, 2014).
In Barriere v. Juluca, the district court denied a motion to quash service of process and
motion to dismiss while noting that courts were split on the issue of service of a foreign
corporation by mail. Id. Nevertheless, the district court opted to “follow the rule that where
the destination state does not object, service by registered mail is proper under the [Hague
Service Convention].” Id. Pursuant to Rule 4(f)(2)(C)(ii), the plaintiffs in Barriere submitted
to the Clerk of Court a request for foreign service upon the defendant abroad. Accordingly,
the Clerk of Court dispatched the documents via Federal Express International Mail to the
foreign defendant with return receipt requested. Id. at *3; see also TracFone Wireless, Inc. v.
Unlimited PCS Inc., 279 F.R.D. 626, 632 (S.D. Fla. 2012) (directing the Clerk of Court to
serve a foreign defendant by sending documents via Federal Express, return receipt
requested, pursuant to Rule 4(f)(3) and Article 10(a) of the Hague Service Convention).
The same steps were not followed by Plaintiff here and make service on TheHut.com
Limited deficient. Plaintiff initiated service of process on its own without seeking leave of
Court or assistance from the Clerk to properly effectuate service on TheHut.com Limited,
pursuant to Rule 4(f)(2)(C)(ii). Because of the disharmony about whether service of process
by mail is an appropriate form of service under Rule 4(f) and the Hague Service
Convention, Plaintiff should have sought assistance from the Clerk, since “the Court may
There is no service deficiency with co-Defendant Mama Mio US, Inc. The record reflects
that Plaintiff contacted Defendant’s registered agent in Delaware to ask if he or she would
accept service of process, which he or she did. Rule 4(h) “permits a plaintiff to serve a
corporation by personally serving an officer, a managing or registered agent, or by following
the applicable state law.” Winmark Corp. v. Brenoby Sports, Inc., No. 13-CIV-62697, 2014 WL
11706427, at *1 (S.D. Fla. May 30, 2014).
use its discretion to decide the proper basis for the chosen method of international service.”
Hernandez, 126 F. Supp. 3d at 1360; see also Leon v. Cont’l AG, 176 F. Supp. 3d 1315, 1319 –
20 (S.D. Fla. 2016) (ordering the Clerk of Court serve foreign defendants via international
express mail and Federal Express and that plaintiffs file a copy of the “proof of signature” as
evidence that service had been effectuated).
Further, Plaintiff has failed to respond to the assertions about the lack of personal
jurisdiction over TheHut.com Limited. “On a motion to dismiss for lack of personal
jurisdiction, the plaintiff bears the initial burden of ‘alleging sufficient facts to make out a
prima facie case of jurisdiction’ over the nonresident defendant.” Keim v. ADF MidAtlantic,
LLC, No. 12-80577-CIV, 2016 WL 4248224, at *2 (S.D. Fla. Aug. 10, 2016) (quoting Posner
v. Essex Ins. Co., 178 F.3d 1209, 1214 (11th Cir. 1999) (per curiam)). Plaintiff offers no
personal jurisdiction analysis over TheHut.com Limited. So even if service was proper,
Plaintiff fails to meet his burden on personal jurisdiction over the nonresident Defendant.
See id. at *2.
B. Lack of Subject Matter Jurisdiction
Federal district courts “have original jurisdiction of all civil actions arising under the
Constitution, laws, or treatises of the United States.” 28 U.S.C. § 1331. Districts courts also
aver jurisdiction over civil actions where the amount in controversy exceeds $75,000, and is
between citizens of different states or foreign countries. 28 U.S.C. § 1332.
“A defendant can move to dismiss a complaint under Rule 12(b)(1) for lack of
subject matter jurisdiction by either facial or factual attack.” Stalley ex rel. U.S. v. Orlando
Reg’l Healthcare Sys., Inc., 524 F.3d 1229, 1233 (11th Cir. 2008). “A facial attack on the
complaint requires the court merely to look and see if the plaintiff has sufficiently alleged a
basis of subject matter jurisdiction, and the allegations in his complaint are taken as true for
the purposes of the motion.” Id. On the other hand, “a factual attack on a complaint
challenges the existence of subject matter jurisdiction using material extrinsic from the
pleadings, such as affidavits or testimony.” Id. (quoting McElmurray v. Consol. Gov’t of
Augusta-Richmond Cty., 501 F.3d 1244, 1250 (11th Cir. 2007)).
When the attack is factual, “no presumptive truthfulness attaches to plaintiff’s
allegations, and the existence of disputed material facts will not preclude the trial court from
evaluating for itself the merits of jurisdictional claims.” Lawrence, 919 F.2d at 1529. Thus,
“the court may look beyond the four corners of the complaint so long as they relate to
jurisdictional issues, hear conflicting evidence and decide the factual issues that determine
jurisdiction.” Canopius U.S. Ins., Inc. v. Prestige Gen. Cleaning Servs., Inc., No. 14-CIV-81095,
2014 WL 6979658, at *2 (S.D. Fla. Dec. 9, 2014). Moreover, “the courts may use their
judicial experience and common sense in determining whether the case stated in a
complaint meets federal jurisdictional requirements.” Id. (quoting Roe v. Michelin N. Am.,
Inc., 613 F.3d 1058, 1062 (11th Cir. 2010)).
A dismissal for failure to meet the amount in controversy requirement may be
granted only where “it appears to a legal certainty that plaintiff’s claim is actually for less
than the jurisdictional amount.” Lamar Co., LLC v. City of Stuart, Fla., No. 08-14267-CIV,
2009 WL 690629, at *2 (S.D. Fla. Mar. 16, 2009) (quoting Burns v. Windsor Ins. Co., 31 F.3d
1092 (11th Cir. 1994); see also Burlington Ins. Co. v. Brown, 2013 WL 3470724, at *2 (M.D.
Fla. July 10, 2013) (“Generally, the Court accepts that the amount in controversy has been
satisfied when the plaintiff claims a sufficient sum in good faith, absent facts demonstrating
to a legal certainty that the claim is really for less than the jurisdictional amount.”). Yet,
“where jurisdiction is based on a claim for indeterminate damages, the legal certainty test
gives way, and the party seeking to invoke federal jurisdiction bears the burden of proving
by a preponderance of the evidence that the claim on which it is basing jurisdiction meets
the jurisdictional minimum.” Canopius, 2014 WL 6979658, at *2 (quoting Federated Mut. Ins.
Co. v. McKinnon Motors, LLC, 329 F.3d 805, 807 (11th Cir. 2003)).
Here, the attack on the Court’s subject matter jurisdiction is factual. The Plaintiff
alleges that this dispute involves a controversy exceeding $75,000. Amended Compl. ¶ 2).
As support for the amount in controversy requirement, Plaintiff indicates the following: (1)
an unspecified amount in lost sales; and (2) the termination of its distribution agreement
with Compressport alleged to be worth in excess of $3 million. (Id. ¶ 20). In its Motion, the
Defendants specified the total sales of Compressport products it made between January
2013 and February 2016, i.e., the time during which Plaintiff contends the Defendants
interfered with Plaintiff’s exclusive distribution agreement with Compressport. These sales
amounted to $9,109. ECF No. 30-1. This figure pales in comparison to the amount Plaintiff
alleges to have suffered. Further, Plaintiff’s unspecified amount in lost sales leaves me to
speculate as to what the value of the lost sales could be.
Rather than putting forth additional evidence upon Defendants’ jurisdictional
challenge, Plaintiff keeps to its “conclusory assertions that [its] damages exceed $75,000.”
Bradley v. Kelly Servs., Inc., 224 Fed. Appx. 893, 894 – 95 (11th Cir. 2007). Though Plaintiff
provides copies of its distribution agreement with Compressport, documents relating to its
termination with Compressport, and other evidence of Defendants’ alleged wrongdoing, it
“has not presented any calculations as to the amount of loss resulting from [Defendant]s’
alleged misconduct.” Id. Although Plaintiff made general allegations that it suffered
damages, Plaintiff “never quantified these losses with any specific dollar figures.” Id.
Accordingly, Plaintiff speculates that its damages would exceed $75,000, but fails to
establish by a preponderance of the evidence that its claims meet the jurisdictional
minimum. Accordingly, this Court lacks subject matter jurisdiction to hear this case.
For the reasons stated above, Defendants’ Motion to Dismiss Plaintiff’s Complaint
(ECF No. 30) is GRANTED. Plaintiff’s Amended Complaint (ECF No. 18) is
DISMISSED without prejudice. The Clerk shall CLOSE this case. All pending motions, if
any, are DENIED as moot.
DONE and ORDERED in chambers at Miami, Florida, this 21st day of December
Copies furnished to:
Edwin G. Torres, U.S. Magistrate Judge
Counsel of record
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