Merchant Ivory Productions (USA), Inc. et al v. Donaldson
Filing
21
ORDER denying Defendant's 10 Motion to Dismiss for lack of subject-matter jurisdiction, improper venue, lack of personal jurisdiction, and improper service of process. Signed by Chief Judge Lisa G. Wood on 9/1/2015. (ca)
3u the Sniteb btatto Motritt Court
for the Ooutbern flttrttt of aeorgia
'abannab JthIion
MERCHANT IVORY PRODUCTIONS
(USA), INC., and JAMES IVORY,
Plaintiffs,
CV 414-240
JOHN GILBERT DONALDSON, JR.,
Defendant.
ORDER
Presently before the Court is Defendant John Gilbert
Donaldson, Jr.'s motion to dismiss Plaintiffs Merchant Ivory
Productions and James Ivory's Complaint. Dkt. no. 10. Defendant
moves to dismiss the Complaint under a variety of defenses
pursuant to Federal Rule of Civil Procedure 12(b), namely: Rule
12(b) (1) for lack of subject-matter jurisdiction; Rule 12(b) (2)
for lack of personal jurisdiction; Rule 12(b) (3) for improper
venue; and Rule 12(b) (5) for insufficient service of process.
For the reasons stated below, Defendant's motion to dismiss is
DENIED.
FACTUAL BACKGROUND
The following facts are taken solely from Plaintiffs'
Complaint (Dkt. no. 1, "Compl.")
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Plaintiff Merchant Ivory Productions France (MIP France) is
a société a responsabilité limitée (limited liability company)
organized under the laws of France and located in Paris, France.
Compl. ¶ 8. Merchant Ivory Productions USA (MIP USA) and
Merchant Ivory Productions UK (MIP UK) collectively own 100% of
MIP France. Id. 191 10-11. Plaintiff James Ivory is the
beneficial owner of MIP UK and MIP USA, and is thus the
beneficial owner of MIP France (henceforth "Merchant Ivory")
Id. ¶ 12.
Merchant Ivory is a film production company. Id. ¶ 13.
Defendant John Gilbert Donaldson, Jr. was a gérant (director) of
Merchant Ivory and was co-director with Plaintiff Ivory until
2013. Id. 91 14. As a co-director, Defendant managed Merchant
Ivory's day-to-day operations. Id.
91 15.
In 2008 and early 2009, Plaintiff Ivory decided to have
Defendant sell an apartment and an office that Merchant Ivory
owned in Paris. Id.
91 19. Defendant lived part-time in Paris,
and was thus tasked with showing the properties to brokers and
coordinating any prospective sales. Id. The office eventually
sold for €340,000 (converting, at the time, to about $472,600),
and the apartment eventually sold for €2,900,000 (or about
$3,886,000). Id. 9191 20-21. Merchant Ivory used most of the
proceeds to pay off its creditors. Id. 91 22. But after paying
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its debts, Merchant Ivory calculates that approximately
$650,980.05 should have remained. Id. ¶ 23.
After the sales of the office and apartment, Merchant Ivory
made repeated requests to Defendant for a full accounting of the
sale proceeds. Id. ¶ 24. While Defendant promised to provide
documentation of the proceeds, he never did. Id. 191 25-27.
Instead, he first suggested that the French government had taken
the balance of the proceeds, but he never produced any
documentation to support this assertion. Id. Despite further
requests, he later claimed that certain bank statements were
never received from the bank. Id. Defendant eventually ceased
all communications with Merchant Ivory. Id.
As a director, Defendant was a signatory to Merchant
Ivory's bank account in France. Id.
91 29. After Defendant
stopped communicating with Plaintiffs, Plaintiffs retained local
counsel in France who was able to obtain copies of the French
bank account's statements and cancelled checks. Id. IT 30-32.
Plaintiffs believe the statements and cancelled checks show that
Defendant misappropriated funds by writing himself checks,
withdrawing cash, and initiating wire transfers from the bank in
France to an account Defendant held with the Savannah Bank in
Savannah, Georgia. Id. 91 33. In addition to these known
misappropriations, Plaintiffs believe Defendant is responsible
for additional wire transfers and disbursed checks amounting to
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$188,536.25 and $340,478.97, respectively. Id. ¶ 34. In all,
Plaintiffs claim Defendant misappropriated at least $260,889.89.
Id ¶ 33.
Plaintiffs claim that, since discovering the
misappropriations, Defendant has cut off all communications with
Plaintiffs and has not provided any explanation for the
withdrawals. Id. ¶ 36. Plaintiffs bring four claims against
Defendant: breach of fiduciary duty, demand for an accounting,
misappropriation of corporate assets, and negligence in
management pursuant to French law. Id. ¶I 37-64.
DISCUSSION
I.
Subject-Matter Jurisdiction
Defendant moves to dismiss this action for lack of subjectmatter jurisdiction under Federal Rule of Civil Procedure
12(b) (1). A motion to dismiss brought pursuant to Rule 12(b) (1)
of the Federal Rules of Civil Procedure may challenge the
court's subject-matter jurisdiction based on the face of the
pleadings or the substantive facts of the case. Morrison v.
Amway Corp., 323 F.3d 920, 924 n.5 (11th Cir. 2003). When
addressing a facial challenge, allegations in the plaintiff's
complaint are taken as true, and the court determines whether
the complaint sufficiently alleges a basis for subject-matter
jurisdiction. Scarfo v. Ginsberg, 175 F.3d 957, 960 (11th Cir.
1999) (citing Lawrence v. Dunbar, 919 F.2d 1525, 1529 (11th Cir.
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1990)) . The complaint may be dismissed on a facial attack only
"if it is clear that no relief could be granted under any set of
facts that could be proved consistent with the allegations."
Jackson v. Okaloosa Cnty., Fla., 21 F.3d 1531, 1534 (11th Cir.
1994) (citation omitted)
When addressing a factual challenge, a court "is free to
weigh the evidence and satisfy itself as to the existence of its
power to hear the case." See Lawrence, 919 F.2d at 1528-29
(quoting Williamson v. Tucker, 645 F.2d 404, 412 (5th Cir.
1981)); see also Scarfo, 175 F.3d at 960 ("[M]atters outside the
pleadings, such as testimony and affidavits, are considered.")
Therefore, the presumption of truthfulness afforded a plaintiff
under Federal Rule of Civil Procedure 12(b) (6) does not attach
to a factual challenge to the court's subject-matter
jurisdiction. See Scarfo, 175 F.3d at 960.
Defendant makes absolutely no argument regarding his motion
to dismiss for lack of subject-matter jurisdiction, so the court
is unable to tell if the challenge is either facial or factual.
Either by looking only to the allegations in the Complaint or by
considering evidence outside of the pleadings, it is clear that
the Court has subject-matter jurisdiction over this action. The
amount in controversy exceeds $75,000, and Defendant's counsel
stated at a hearing before the Court that there is diversity
jurisdiction. See Compl. at 10 (seeking actual damages in the
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amount of $260,889.89 and punitive damages of at least
$1,000,000); Dkt. no. 17 ("Hearing Trans."), 7:24-8:1. Thus,
this Court has jurisdiction over the action pursuant to 28
U.S.C. § 1332.
II. Standard of Proof Governing the Remaining Rule 12(b)
Motions
In addition to subject-matter jurisdiction, Defendant moves
to dismiss Plaintiffs' Complaint for lack of personal
jurisdiction, improper venue, and ineffective service of
process. See Fed. R. Civ. P. 12(b) (2) , 12(b) (3) , 12(b) (5) . These
grounds for dismissal share the same standard of proof.
In the context of such motions in which no evidentiary
hearing is held, the plaintiff must present only a
prima facie showing of venue and personal
jurisdiction. . . . The facts as alleged in the
complaint are taken as true, to the extent they are
uncontroverted by defendants' affidavits. . . . In
addition, when there is a battle of affidavits placing
different constructions on the facts, the court is
inclined to give greater weight, in the context of a
motion to dismiss, to the plaintiff's version . .
Delong Equip. Co. v. Wash. Mills Abrasive Co., 840 F.2d 843, 845
(11th Cir. 1988) (citations omitted); see also Meier ex rel
Meier v. Sun Intern. Hotels, Ltd., 288 F.3d 1264, 1268-69 (11th
Cir. 2002) (applying this evidentiary standard to motions to
dismiss for lack of personal jurisdiction); Kammona v. Onteco
Corp., 587 F. App'x 575, 578 (11th Cir. 2014) ("In assessing the
validity of service of process, the standards of proof governing
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motions to dismiss for lack of personal jurisdiction are
applicable.") cert. denied, 135 S. Ct. 2316, (2015).
III. Personal Jurisdiction
Defendant argues that the Court lacks personal jurisdiction
over him because he does not have minimum contacts with Georgia
and, even if he did, other factors weigh against personal
jurisdiction.
"A federal court sitting in diversity undertakes a two-step
inquiry in determining whether personal jurisdiction exists: the
exercise of jurisdiction must (1) be appropriate under the state
long-arm statute and (2) not violate the Due Process Clause of
the Fourteenth Amendment to the United States Constitution."
United Techs. Corp. v. Mazer, 556 F.3d 1260, 1274 (11th Cir.
2009)
a. Defendant has Transacted Business Within the State
Pursuant to Georgia's Long-Arm Statute
In construing a state long-arm statute in a personal
jurisdiction analysis, the court must interpret the statute as
would the state's Supreme Court. See id. The relevant portions
of Georgia's long-arm statute state:
A court of this state may exercise personal
jurisdiction over any nonresident or his or her
executor or administrator, as to a cause of action
arising from any of the acts, omissions, ownership,
use, or possession enumerated in this Code section, in
the same manner as if he or she were a resident of
this state, if in person or through an agent, he or
she:
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(1) Transacts any business within this state;
(2) Commits a tortious act or omission within this
state, except as to a cause of action for defamation
of character arising from the act;
(3) Commits a tortious injury in this state caused by
an act or omission outside this state if the tortfeasor regularly does or solicits business, or engages
in any other persistent course of conduct, or derives
substantial revenue from goods used or consumed or
services rendered in this state.
Ga. Code Ann. § 9-10-91.
To exercise personal jurisdiction over a nonresident who
transacts business within Georgia, the court must find:
first, the nonresident must have purposefully done an
act or consummated a transaction in Georgia; second,
the cause of action must arise from or be connected
with such act or transaction; and third, the exercise
of jurisdiction by the courts of this state must not
offend traditional fairness and substantial justice.
Gateway Atlanta Apartments, Inc. v. Harris, 660 S.E.2d 750, 757
(Ga. Ct. App. 2008) . Under the first prong, a party can
"consummate" a transaction in Georgia by utilizing a Georgia
bank's resources, even when he initiates the transactions out of
state, so long as the transaction has a "substantial" economic
effect. See Ga. R.R. Bank & Trust Co. v. Barton, 315 S.E.2d 17,
19 (Ga. Ct. App. 1984) (signing, in South Carolina, promissory
notes from a Georgia bank is transacting business in the State
for purposes of long-arm jurisdiction where amount of loan was
$125,000); see also Burger King Corp. v. Rudzewicz, 471 U.S.
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462, 476 ("[lit is an inescapable fact of modern commercial life
that a substantial amount of business is transacted solely by
mail and wire communications across state lines, thus obviating
the need for physical presence within a State in which business
is conducted." (emphasis added)); Diamond Crystal Brands, Inc.
v. Food Movers Intern., Inc., 593 F.3d 1249, 1249 (noting that a
defendant need not physically enter Georgia to "transact any
business" in the state) . The first and second prongs of the
personal jurisdiction analysis determine whether the nonresident
has established minimum contacts with the state. Gateway Atlanta
Apartments, Inc., 660 S.E.2d at 757. The "due process" prong
"requires that the nonresident have performed purposeful acts to
tie itself to Georgia, and these minimum contacts may not be
merely random, fortuitous, or attenuated." Id. (quotations
omitted)
Here, Plaintiffs allege that Defendant wired
misappropriated funds to a bank account in Savannah, Georgia.
Plaintiff Ivory alleged in an affidavit that Defendant was the
only person in France with the power to disburse checks, issue
wire transfers, or withdraw the funds that Plaintiffs claim
Defendant misappropriated. Dkt. no. 11-2, ("Ivory Aff.") ¶ 2.
Additionally, Ivory stated that of the misappropriated funds,
bank account statements show that Defendant wired at least
$22,368 to the Savannah Bank in Georgia. Id. ¶ 3. Defendant
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allegedly directed a substantial sum of misappropriated funds to
a Georgia bank, and the present cause of action directly arises
from and is connected to these transactions. Thus, Defendant has
purposefully established minimum contacts with the state of
Georgia, and the cause of action arises from these contacts.
These purposeful transactions are neither "random,"
"fortuitous," or "attenuated," and exercising personal
jurisdiction over Defendant will not offend traditional notions
of fairness and substantial justice under Georgia law.
b. Due Process Under the Fourteenth Amendment
Federal case law requires that a federal court sitting in
diversity undertake a Fourteenth Amendment analysis in addition
to applying the forum state's long-arm statute. United Techs.
Corp., 556 F.3d at 1274 (11th Cir. 2009). Georgia already
requires a due process analysis in applying its long-arm
statute. See Gateway Atlanta Apartments, Inc., 660 S.E.2d at
757. Even so, these two inquiries are not "one and the same,"
and this Court will conduct a constitutional analysis
independent of the statutory long-arm analysis to determine
whether personal jurisdiction over the Defendant is appropriate
in this case. Diamond Crystal Brands, 593 F.3d at 1262-63.
As the Eleventh Circuit has observed,
The Due Process Clause protects an individual's
liberty interest in not being subject to binding
judgments imposed by foreign sovereigns. The heart of
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this protection is fair warning—the Due Process Clause
requires that the defendant's conduct and connection
with the forum State [be] such that he should
reasonably anticipate being haled into court there.
Therefore, states may exercise jurisdiction over only
those who have established certain minimum contacts
with [the forum] such that the maintenance of the suit
does not offend "traditional notions of fair play and
substantial justice."
Id. at 1267 (internal quotations and citations omitted) (citing
Burger King Corp., 471 U.S. at 472-73; Helicopteros Nacionales
de Columbia S.A. v. Hall, 466 U.S. 408, 414 (1984)). Thus,
personal jurisdiction comports with federal due process when the
nonresident defendant (1) has purposefully established minimum
contacts with the forum state, and (2) the exercise of
jurisdiction will not offend traditional notions of fair play
and substantial justice. Delong Equip., 840 F.2d at 853.
i. Defendant Has Purposefully Established Minimum
Contacts With the State of Georgia
Three inquiries inform the minimum contacts analysis:
First, the plaintiff's cause of action must arise out
of, or relate to, the nonresident defendant's contacts
with the forum state. Second, the contacts must show
that the nonresident defendant purposefully availed
itself of the privilege of conducting activities
within the forum state. Third, the defendant's
contacts must demonstrate that the nonresident could
reasonably anticipate being haled into court in the
forum.
Paul, Hastings, Janofsky & Walker, LLP v. City of Tulsa, OK, 245
F. Supp. 2d 1248, 1255 (N.D. Ga. 2002) (citing Vermeulen v.
Renault, U.S.A., Inc., 985 F.2d 1534, 1546 (11th Cir. 1993)).
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I
First, as discussed above, Plaintiffs' cause of action
arises out of Defendant's contacts with the state. Plaintiffs
bring misappropriation claims, and allege that Defendant wired
$22,368 of misappropriated funds to a bank in Savannah, Georgia.
Second, the Complaint and supporting affidavits allege that
Defendant intentionally and repeatedly wired the misappropriated
funds to the Savannah Bank. If true, Defendant would have
purposefully availed himself of the opportunity to conduct
activities in Georgia on a continuing basis. Defendant had a
world of banks to choose from, and the pleadings allege that he
chose Savannah Bank of Savannah, Georgia.
Third, Defendant's contacts with the state of Georgia are
such that Defendant should have anticipated being haled into
court in the State of Georgia. While jurisdiction is not proper
when it is the result of "'random,' 'fortuitous,' or
'attenuated' contacts . . . or of the 'unilateral activity of
another party or a third person,'" personal jurisdiction arises
"where the contacts proximately result from actions by the
defendant himself that create a 'substantial connection' with
the forum State." Burger King Corp., 471 U.S. at 475-76
(emphasis in original) (citations omitted) . Here, Defendant
allegedly wired a substantial amount of money to a Georgia bank
on at least three different occasions. He availed himself of the
privilege of using a Georgia-based institution's financial
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conduits, and thus enjoyed the benefits and protections of
Georgia's laws. It is thus "presumptively not unreasonable to
require him to submit to the burdens of litigation in [Georgia]
as well." See id. at 476.
For these three reasons, Defendant has the requisite
minimum contacts with Georgia.
ii. Traditional Notions of Fair Play and Substantial
Justice Allow Personal Jurisdiction Over
Defendant
Once it is shown that the defendant has purposefully
established minimum contacts in the forum state, a defendant
must make a "compelling case" that the exercise of jurisdiction
would violate traditional notions of fair play and substantial
justice. Diamond Crystal Brands, Inc., 593 F.3d at 1267. The
analysis requires courts to look to "the burden on the
defendant, the forum State's interest in adjudicating the
dispute, the plaintiff's interest in obtaining convenient and
effective relief, the interstate judicial system's interest in
obtaining the most efficient resolution of controversies, and
the shared interest of the several states in furthering
fundamental substantive social policies." Id. at 1274 (citations
omitted)
Defendant argues that litigating this matter in Georgia
would place an unreasonable burden on him because he lives and
works in France. He also argues that Plaintiffs reside in New
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York, and thus litigation in Georgia would not be convenient for
either party. Defendant's arguments have some merit and are
supported by the evidence: Defendant and his father both say he
has "lived and worked in Paris, France" for the past 20 years,
(Dkt. nos. 15-1 ¶ 4, 10-1 ¶ 8 ); they both claim he has not
"resided" in Savannah since 1979, (Dkt. nos. 15-1 ¶ 2, 10-1 at
¶ 7); and they both claim that he lived in New York prior to
moving to France, (Dkt. nos. 15-1 ¶ 3, 10-1 ¶ 9) . However, this
evidence is contradicted by the video and audio evidence that
Plaintiffs submitted, recorded on November 6, 2014, showing
Defendant's father unequivocally stating that Defendant "lives
here," at Defendant's father's home in Savannah, Georgia. Thus,
regardless of where Defendant and his father affie he "resides,"
"lives," and "works," there is contradictory evidence on the
record showing that Defendant "lives" in Savannah, Georgia. The
Court must resolve this contradiction in the evidence in favor
of Plaintiffs. Meier, 288 F.3d at 1269. Because Defendant haunts
Savannah frequently enough for his father to claim he lives
there, litigating this case in Savannah will not inconvenience
Defendant as much as he suggests.
Furthermore, while Plaintiffs have suggested that Savannah
will not be the most convenient forum for them, they have
maintained that the Southern District of Georgia will be a
proper venue if Defendant refuses to consent to transfer the
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I
case to the State of New York. Dkt. no. 20-6, p. 11. To the
Court's knowledge, Defendant has not responded to this proposal.
Thus, the Court will not weigh any inconvenience to Plaintiffs
against them in the "traditional notions of fair play and
substantial justice" analysis.
And while neither Plaintiffs nor (as he purports) Defendant
are Georgia residents, Georgia still has an interest in
overseeing the resolution of this case. Part of Plaintiffs'
injuries occurred in this State via a local financial
institution. See Phillips v. Consol. Pub. Co., No. CV 213-069,
2014 WL 1319357, at *9 (S.D. Ga. Mar. 31, 2014) ("a state has an
interest in redressing injuries that occur within that state.")
Additionally, "relevant witnesses and evidence undoubtedly exist
in Georgia" by way of Savannah Bank. See TRS & Assos., Inc. v.
Document Imaging Tech, Inc., No. CV 108-03264, 2009 WL 2778256,
at *8 (N.D. Ga. Aug. 25, 2009) . Finally, Plaintiffs have
expressed an interest in "chasing the money," as they say, and
their interests thus rest in resolving this matter in Georgia.
The inconvenience to Defendant does not outweigh these
considerations. This Court's exercise of personal jurisdiction
over Defendant will not violate traditional notions of fair play
and substantial justice, and thus will not violate Defendant's
Fourteenth Amendment due process rights. Personal jurisdiction
over the Defendant is appropriate in this case.
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IV. Venue
Defendant also moves to dismiss this action for improper
venue, and Federal Rule of Civil Procedure 12(b) (3) authorizes
such a motion. Defendant, however, offers no argument or
discussion as to why the Southern District of Georgia is an
improper venue for this case, and perhaps has only stated the
defense as a variation of his personal jurisdiction argument. In
any event, the controlling law clearly permits venue in the
Southern District of Georgia.
Rule 12(b) (3) authorizes dismissal only when venue is
"improper" in the forum in which it is brought. Atlantic Marine
Const. Co., Inc. v. U.S. Dist. Ct. for W. Dist. of Tex., 134 S.
Ct. 568, 577 (2013). 28 U.S.C. § 1391 governs this analysis and
allows civil actions to be brought in
(1) a judicial district in which any defendant
resides, if all defendants are residents of the State
in which the district is located;
(2) a judicial district in which a substantial part of
the events or omissions giving rise to the claim
occurred, or a substantial part of property that is
the subject of the action is situated; or
(3) if there is no district in which an action may
otherwise be brought as provided in this section, any
judicial district in which any defendant is subject to
the court's personal jurisdiction with respect to such
action.
28 U.S.C. § 1391(b). "When venue is challenged, the court must
determine whether the case falls within one of the three
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categories set out in § 1391 (b) . If it does, venue is proper; if
it does not, venue is improper, and the case must be dismissed
or transferred under § 1406(a) ." Atlantic Marine Const., 134 S.
Ct. at 577.
While some evidence suggests that Defendant "lives" in
Savannah, that characterization of the facts is hotly contested.
The first category in § 1391(b), then, will not directly
determine the proper venue for this case.
The second category is more promising. Section 1391(b) (2)
allows venue in a jurisdictional district "in which a
substantial part of the events or omissions giving rise to the
claim occurred, or a substantial part of property that is the
subject of the action is situated". § 1391(b) (2). By
§ 1391(b) (2)'s terms, then,
"[o]nly the events that directly
give rise to a claim are relevant. And of the places where the
events have taken place, only those locations hosting a
'substantial part' of the events are to be considered." Jenkins
Brick Co. v. Bremer, 321 F.3d 1366, 1371 (11th Cir. 2003)
(construing an earlier iteration of § 1391(b) (2)) . The question
becomes, then: Do three wire transactions to a bank in Savannah,
totaling some $22,368 of an alleged misappropriation equal to at
least $260,889.89, amount to a "substantial part of the events"
giving rise to the claim?
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On one hand, the evidence and allegations suggest that the
portion of the misappropriation directed to Savannah could be
less than 10% of the total sum. While $22,368 may be a
substantial amount of money, it is a relatively insubstantial
portion of a sum totaling at least $260,889.89. Similarly, while
three wire transactions to Savannah bank could, by themselves,
represent a "substantial" misappropriation of funds, those three
transactions may not constitute a substantial part of the
conduct giving rise to the full misappropriation claim.
On the other hand, the Savannah transactions are
significant because we know so few details about the balance of
the defalcation. While the amounts and frequency of the Savannah
transactions may not be "substantial" in light of the total
misappropriation, the amounts and frequency of these wires are
substantial when compared to the available evidence of how much
and by what means Defendant misappropriated the balance of the
funds. Except for certain cash withdrawals in France, there is
insufficient information in the record to make an adequate
comparison of the other alleged instances of misappropriation
with the Savannah Bank transactions such that the Court may
determine which transactions are more "substantial."
The France cash withdrawals, though, warrant further
attention. In a demand letter it sent to Defendant, Merchant
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Ivory identifies several problems it found in its account
statements for which it wants an accounting:
First, there are three wire transfers to the Savannah
Bank, totaling $44,094.62.' Second, from May 2009, to
June 2011, there were sixty (60) cash withdrawals
made, totaling $60,300. Notably, all of these cash
withdrawals were made at two HSBC branch locations,
Rue Condorcet and Rue Madeleine, which upon our
information and belief are located near your
[Parisian] apartment.
Compi. p. 14. Thus, while the Savannah transactions were
substantial in some respects, they are less substantial than the
withdrawals in France. But § 1391(b) (2) does not require venue
to rest in the "best" district—the appropriate question is
whether the district the plaintiff chose has personal
jurisdiction over the defendants, whether or not other forums
had greater contacts. Lisevald v. Marcus, 173 F.R.D. 689, 700
(M.D. Fla. 1997) (quoting Setco Enters. Corp. v. Robbins, 19
F.3d 1278, 1281 (8th Cir. 1994)). Venue in this case, then, is
appropriate under § 1391(b) (2) •2
V.
Service of Process
Finally, Defendant moves to dismiss the Complaint for
insufficient service of process under Rule 12 (b) (5) . Under Rule
4(m), a plaintiff must serve the summons and a copy of the
1
The demand letter states that the Savannah wires totaled $44,094.62, but
Plaintiff Ivory's affidavit claims they totaled "at least" $22,368.00.
Compare Compi. p. 14, with Ivory Aff. ¶ 3. This discrepancy is not explained,
but it is immaterial to this analysis.
2
The Court does not need to further address the question of whether France
would be a "better" forum at this time, as Defendant has not invoked the
doctrine of forum non conveniens.
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complaint on a defendant within 120 days after filing the
action. The plaintiff may do so by "leaving a copy of [the
summons and complaint] at the individual's dwelling or usual
place of abode with someone of suitable age and discretion who
resides there." Fed. R. Civ. P. 4(e) (2) (B). Or, the plaintiff
may serve the defendant by "following state law for servicing a
summons in an action brought in courts of general jurisdiction
in the state where the district court is located or where
service is made." Fed. R. Civ. P. 4(e)(1). To that end, Georgia
law also allows service of the summons and complaint "by leaving
copies thereof at the defendant's dwelling house or usual place
of abode with some person of suitable age and discretion then
residing therein." Ga. Code Ann. § 9-11-4(e) (7).
Here, Plaintiffs' Process Server left copies of the
Complaint and summons at Defendant's father's house in Savannah,
Georgia after having the following exchange with the father:
Process Server:
Mr. Donaldson Sr.:
Process Server:
Mr. Donaldson Sr.:
Process Server:
Mr. Donaldson Sr.:
Process Server:
Mr. Donaldson Sr.:
Process Server:
Mr. Donaldson Sr.:
Process Server:
Mr. Donaldson Sr.
Process Server:
Mr. Donaldson Sr.:
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I'm looking for John Donaldson—
Right.
—Gilbert.
Right.
Are you him?
Yeah. John Gilbert Donaldson.
I think it's for Junior.
Okay. He lives here.
Okay. Are you his dad?
Yes.
Okay. Can I just leave it with
you?
Do what?
I'll just leave it with you.
Okay. That's fine.
20
Process Server:
Thank you very much. You have a
good day.
Mr. Donaldson Sr.: You too.
See Dkt. no. 20-6, P. 7. The Court reviewed an audio and video
recording of this conversation at a motions hearing on May 14,
2015. See Dkt. no. 17 (Hearing Transcript), 17:23-18:14. This
evidence suggests that Defendant "lived" with his father in
Savannah on November 6, 2014.
Defendant attempts to rebut this evidence with affidavits.
First, his father's affidavit states that, despite his
statements on the video, "At the time the papers . . . were
delivered to Affiant on November 6, 2014, John Gilbert
Donaldson, Jr., did not reside in Affiant's household . . . [in]
Savannah, Georgia," and that "For the past twenty (20) years,
John Gilbert Donaldson, Jr., has lived and worked in Paris,
France, and has not maintained a residence in the State of
Georgia." Dkt. no. 10-1, 191 6, 8. In his own affidavit,
Defendant reiterates that he "has not lived in or been a
resident of the State of Georgia since August of 1979." Dkt.
no. 15-1, ¶ 2. Defendant concedes, though, that his "visits to
Savannah, Georgia to see his father or to attend events like the
Savannah Film Festival are infrequent and have nothing to do
with the allegations of the Plaintiff's Complaint." Id. ¶ 7.
Before the Court, then, is a battle of affidavits. As such,
"the court is inclined to give greater weight, in the context of
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a motion to dismiss, to the plaintiff's version" of the facts.
Delong Equip., 840 F.2d at 845. This is not to say that
Defendant's affidavits carry no weight at all. But his father's
affidavit stating that Defendant has not resided in Savannah
since 1979 is, frankly, unpersuasive on the heels of a video and
audio recording of him explicitly stating that Defendant "lives"
at his house in Savannah as of November, 2014. Additionally,
Defendant had the opportunity in his own affidavit to more fully
explain his presence in Savannah on that date. The Court does
not necessarily believe that Defendant's presence in the
Southern District of Georgia on November 6, 2014 alone should
subject him to local service of process or personal
jurisdiction. However, Defendant's affidavits fail to provide
the Court with information it would need to fully contextualize
his presence in Savannah on that date or to qualify his father's
recorded statement. If Defendant had provided more details about
the length, frequency, or regularity of his visits to Savannah,
the Court may have been able to determine whether his presence
would make him a denizen of Savannah or merely a sojourner. As
it stands, though, Defendant's own affidavit amounts to nothing
more than conclusory assertions designed to undermine his
father's prior statements.
Despite their contradictions, to the extent the affidavits
plausibly show that Defendant resides somewhere other than
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Savannah, Georgia, the Court notes that a person can have more
than one dwelling or usual place of abode, provided that each
dwelling place contains sufficient indicia of permanence. See
Nat'l Dev. Co. v. Triad Holding Corp., 930 F.2d 253, 257 (2d
Cir. 1991) . Evidence that Defendant "lives" in Savannah is
sufficient indicia of permanence here absent a more detailed
showing of how often or how frequently Defendant actually lives
in the city. Furthermore, courts usually construe Rule
4(e) (2) (B) liberally where a defendant has notice of the suit
and is living at the place of service when served. Nowell v.
Nowell, 384 F. 2d 951, 953 (5th Cir. l967). And here, Defendant's
counsel conceded at the motions hearing that Defendant had
received notice of the suit, Dkt. no. 17, 4:3-4, and the
evidence suggests that he "lived" at his father's house when he
was served there.
On balance, the Court finds that Plaintiffs' evidence of
where Defendant "lives" is more persuasive than Defendant's
rebuttal affidavits. Service on Defendant was proper in the
Southern District of Georgia, and Defendant's Rule 12(b) (5)
motion must be denied.
Decisions of the old Fifth Circuit Court of Appeals handed down before
September 30, 1981 are binding precedent on district courts in the Eleventh
Circuit. Bonner v. City of Prichard, Ala., 661 F.2d 1206, 1207 (11th Cir.
1981)
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CONCLUSION
Plaintiffs allege that Defendant sent misappropriated funds
to Savannah, Georgia, and they then served him in Savannah.
Venue, personal jurisdiction, and service of process are all
proper in the Southern District of Georgia. Additionally,
subject-matter jurisdiction is proper pursuant to 28 U.S.C.
§ 1332. Thus, Defendant's motion to dismiss for lack of subjectmatter jurisdiction, improper venue, lack of personal
jurisdiction, and improper service of process (Dkt. no. 10) is
DENIED.
SO ORDERED, this 1ST day of September, 2015.
,
OA~7, L___
LISA GODBEY OOD, CHIEF JUDGE
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF GEORGIA
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