Blume v. International Services, Inc., et al.
MEMORANDUM AND ORDER: IT IS HEREBY ORDERED that the motion of defendants to dismiss for lack of personal jurisdiction (Doc. 10) is denied. IT IS FURTHER ORDERED that the motion of defendants to dismiss for improper venue (Doc. 11) is denied. IT IS FURTHER ORDERED that the motion of defendants to transfer venue (Doc. 13) is denied without prejudice. Signed by Magistrate Judge David D. Noce on 5/31/2012. (KMS)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
CHARLES BLUME, individually and
on behalf of all others similarly
INTERNATIONAL SERVICES, INC.,
No. 4:12 CV 165 DDN
MEMORANDUM AND ORDER
This action is before the court upon the motions of defendants
International Services, Inc., f/k/a International Profit Associates,
Inc., a/k/a ROI-North America, Inc.; GPS USA, Inc.; and Integrated
Business Analysis, Inc., a/k/a IBA USA, to dismiss for lack of personal
jurisdiction (Doc. 10), to dismiss for improper venue (Doc. 11), and to
transfer (Doc. 13).
The parties have consented to the exercise of
plenary authority by the undersigned United States Magistrate Judge
pursuant to 28 U.S.C. § 636(c).
Oral argument was heard on
April 5, 2012.
On January 31, 2012, plaintiff Charles Blume commenced this action,
individually and on behalf of all others similarly situated, against his
International Profit Associates, Inc., a/k/a ROI-North America, Inc.; GPS
(collectively, defendants), for unpaid wages.
the complaint, defendants are Illinois corporations with their principal
In his complaint, plaintiff alleges that defendants “are all
subject to the same corporate structure, have the same management, the
same ownership[,] and jointly controlled all relevant aspects of [his
and the prospective opt-in plaintiffs’] terms and conditions of
employment.” (Doc. 1 at ¶ 5.)
place of business in Buffalo Grove, Illinois.
(Id. at ¶ 5.)
are in the business of providing on-site business consulting services to
small-to-medium sized businesses.
(Id. at ¶¶ 1, 7)
resident of St. Louis County, Missouri, worked as a Senior Business
Consultant (SBC) for defendants from 1999 to 2010.
(Id. at ¶¶ 2, 6.)
SBCs travel to clients nationwide to perform consulting services.
at ¶¶ 7-9.)
Defendants’ clients are charged based upon the number of
hours billed by the SBCs.
(Id. at ¶ 7.)
Plaintiff alleges that defendants do not accurately record the time
that their SBCs work and instead track only the hours billed by their
(Id. at ¶ 10.)
Defendants instruct their SBCs to bill only for
time spent working at client locations, even though the SBCs must perform
work away from client locations and defendants pay their SBCs only for
time billed to clients.
(Id. at ¶¶ 11-12.)
Defendants also require
their SBCs to perform other, non-compensated work, including attending
“pre-meetings” before the beginning of a project and attending weekend
meetings in Chicago, Illinois.
(Id. at ¶¶ 13-14.)
SBCs are also
required to be at their respective “Hotel of Record” by the Sunday
evening before a project is set to begin.
(Id. at ¶ 15.)
home on Fridays unless they are required to travel to Chicago for a
If an SBC is not booked by Friday afternoon for a
project beginning during the coming week, the SBC must go to his or her
home airport on Sunday afternoon to wait for a project assignment.
(Id. at ¶ 16.)
Upon receiving a project assignment, the SBC immediately
travels to the client’s city.
The SBC must stay at the airport
until as late as 8:00 p.m. waiting to be assigned a project.
the SBC is not assigned a project, he or she is released and allowed to
return home, but is required to return to the airport the following
afternoon to again await assignment of a project.
Plaintiff alleges that he and all other SBCs were not compensated
for their time waiting at airports or traveling to and from client
locations. (Id. at ¶¶ 17, 18.) Plaintiff alleges that defendants expect
their SBCs to work at least 50 hours each week but do not pay their SBCs
overtime wages. (Id. at ¶¶ 19-20.) Plaintiff also alleges that in 2011,
the Department of Labor investigated defendants’ practices and determined
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that defendants’ SBCs were entitled to overtime wages, which defendants
refused to pay voluntarily.
(Id. at ¶ 21.)
Plaintiff commenced this action as an “opt-in” collective action
under 29 U.S.C. § 216(b).
(Id. at ¶ 23.)
Plaintiff seeks individual and
collective relief from defendants’ method of record keeping and for
defendants’ failure to pay overtime wages and wages for all hours worked.
(Id. at ¶ 24.)
In Count I, plaintiff alleges that defendants violated the federal
Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201-19, by failing to pay
SBCs overtime wages and wages for all hours worked.
(Id. at ¶¶ 25-34.)
Plaintiff alleges that defendants have wilfully failed to keep accurate
records of all hours worked by SBCs.
(Id. at ¶ 29.)
compensatory damages, liquidated damages, attorney’s fees, costs, prejudgment interest, and post-judgment interest.
(Id. at ¶¶ 33-35.)
MOTIONS TO DISMISS
Defendants move to dismiss under Rule 12(b)(2) for lack of personal
jurisdiction and under Rule 12(b)(3) for improper venue.
argue that the applicable venue statute, 28 U.S.C. § 1391, requires that
the court have specific jurisdiction over a defendant,2 and that dismissal
is necessary because the court lacks specific jurisdiction over them.
jurisdiction over them and, as such, the Eastern District of Missouri is
not the proper forum for this action.
Plaintiff responds that defendants have substantial contacts with
Missouri and, pursuant to Missouri’s long-arm statute, the court has
personal jurisdiction over them.
Plaintiff also argues that defendants
consented to jurisdiction by registering with the Missouri Secretary of
State and by designating an agent in Missouri for service of process.
See 28 U.S.C. § 1391(c)(2) (“For all venue purposes . . . an entity
with the capacity to sue and be sued . . . shall be deemed to reside, if
a defendant, in any judicial district in which such defendant is subject
to the court’s personal jurisdiction with respect to the civil action in
question . . . .” (emphasis added)).
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Defendants reply that the court does not have specific jurisdiction
over them because the allegations in plaintiff’s complaint do not arise
out of their contacts with Missouri.
Defendants also argue that under
Missouri law, they have not consented to jurisdiction by registering with
the Missouri Secretary of State or by appointing a registered agent in
Missouri for service of process.
MOTION TO TRANSFER
Defendants alternatively move to transfer this action to the United
States District Court for the Northern District of Illinois.
argue that plaintiff could have originally brought this action in the
Northern District of Illinois and that the Northern District of Illinois
is a more convenient venue for the parties and the possible witnesses.
Plaintiff responds that his decision to commence this action in the
Eastern District of Missouri should be accorded great weight.
also argues that defendants hope to shift any inconvenience from them
onto him and the prospective opt-in plaintiffs. Plaintiff further argues
that the Eastern District of Missouri is a more convenient forum for most
of the possible witnesses.
Defendants reply that plaintiff’s choice of forum should be afforded
little weight and that the Northern District of Illinois would be a more
convenient forum for most of the parties, including the prospective optin plaintiffs, and most of the possible witnesses.
The court may transfer a case pursuant to 28 U.S.C. § 1404(a)3 even
without personal jurisdiction over a defendant.4
Goldlawr, Inc. v.
“For the convenience of parties and witnesses, in the interest of
justice, a district court may transfer any civil action to any other
district or division where it might have been brought or to any district
or division to which all parties have consented.” 28 U.S.C. § 1404(a).
Defendants do not challenge the court’s subject matter jurisdiction
over the action, the lack of which would have precluded transfer. See
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Heiman, 369 U.S. 463, 465-67 (1962); Follette v. Wal-Mart Stores, Inc.,
41 F.3d 1234, 1238 (8th Cir. 1994); Election Sys. & Software, Inc. v.
Avante Int’l Tech. Corp., No. 8:07CV375, 2008 WL 943338, at *2 (D. Neb.
Apr. 7, 2008); Naegler v. Nissan Motor Co., 835 F. Supp. 1152, 1156 (W.D.
Thus, the court first considers defendants’ motion to transfer the
action to the United States District Court for the Northern District of
See Miller v. Hambrick, 905 F.2d 259, 262 (9th Cir. 1990)
(explaining that transfer is often more appropriate than dismissal
because often “dismissal of an action that could be brought elsewhere is
‘time-consuming and justice-defeating’ ” (quoting Goldlawr, 369 U.S. at
467)); accord Poku v. FDIC, 752 F. Supp. 2d 23, 27 (D.D.C. 2010).
Motion to Transfer
A district court has the authority to transfer a case to another
district when transfer would further (1) the convenience of the parties;
(2) the convenience of the witnesses; and (3) the interest of justice.
28 U.S.C. § 1404(a).
The court must consider each of these factors but
is not limited by them; determining whether transfer is appropriate
“require[s] a case-by-case evaluation of the particular circumstances at
hand and a consideration of all relevant factors.”
Terra Int’l, Inc. v.
Miss. Chem. Corp., 119 F.3d 688, 691 (8th Cir. 1997); accord In re Apple,
Inc., 602 F.3d 909, 912 (8th Cir. 2010) (per curiam).
factors can include: (4) the accessibility to records and documents;
(5) the location of the alleged conduct; (6) the law of each forum;
(7) issues of judicial economy; (8) the plaintiff’s choice of forum;
(9) the costs of litigating in each forum; (10) each party’s ability to
enforce a judgment; (11) obstacles to a fair trial; (12) conflict of law
issues; and (13) a court’s expertise with the law of the forum.
119 F.3d at 696.
The party seeking transfer bears the burden of showing
Integrated Health Servs. v. THCI Co., 417 F.3d 953, 957 (8th Cir. 2005)
(“[A] court without subject matter jurisdiction cannot transfer a case
to another court under 28 U.S.C. § 1404(a).”).
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that the balance of factors “strongly” favors transfer.
Graff v. Qwest
Commc’ns Corp., 33 F. Supp. 2d 1117, 1121 (D. Minn. 1999).
Initially, the parties agree that plaintiff could have commenced
this action in the United States District Court for the Northern District
of Illinois, as his claim arises under federal law and defendants’
(Doc. 14-1 at ¶ 5); see 28 U.S.C. § 1331 (federal question
residency of corporate defendants).
Thus, transfer to the Northern
District of Illinois is potentially available under § 1404(a).
§ 1404(a) (the court may transfer only to a district in which the action
could have originally been brought).
Convenience of the Parties
Concerning the convenience of the parties, defendants argue that
litigating in the Northern District of Illinois would be more convenient
for them and for more of the potential opt-in plaintiffs.
argues that litigating this case in the Northern District of Illinois
would be more convenient only for defendants, and that defendants seek
to shift the inconvenience from them onto him.
In support of their argument for transfer, defendants note that
their corporate headquarters is in Buffalo Grove, Illinois, which is
Defendants also note that approximately 712 of their 1,450 employees work
in Buffalo Grove; at least 30 of their SBCs currently reside in the
currently residents of Missouri.
(Id. at ¶¶ 24-27; Doc. 22-1 at ¶ 9.)
Whether transfer would be more convenient for the potential opt-in
plaintiffs is, at this stage of the proceedings, only speculation.
this time, there is only one plaintiff; the opt-in plaintiffs are only
While, as defendants argue, more potential parties
may reside in the Northern District of Illinois than in the Eastern
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District of Missouri,5 there is no way of knowing whether more SBCs from
the Northern District of Illinois will actually opt-in than SBCs from the
Eastern District of Missouri.
For that matter, there is no way of
knowing whether any SBCs from the Northern District of Illinois will optin as parties to this action.
If SBCs who reside in the Northern District of Illinois or elsewhere
besides Missouri opt-in, the convenience-of-the-parties factor will need
At this time, however, plaintiff is the only
claimant in this action, and he resides in the Eastern District of
Missouri. Therefore, transferring the case to the Northern District of
defendants onto plaintiff.
E.g., Battenfeld Techs., Inc. v. Birchwood
Labs., Inc., No. 2:11-cv-04099-NKL, 2011 WL 4088901, at *2 (W.D. Mo.
Sept. 14, 2011) (“The Court will not transfer venue based on the
inconvenience from one party to another.”).
The record is insufficient for the court to determine the likelihood
that more plaintiffs will opt-in from the Northern District of Illinois
than from the Eastern District of Missouri or elsewhere so as to tip the
convenience scale in favor of transfer.
E.g., Shultz v. Hyatt Vacation
Mktg. Corp., No. 10-CV-04568-LHK, 2011 WL 768735, at *7 (N.D. Cal. Feb.
28, 2011) (“Given that there is no way to know now whether these putative
class members will eventually play a role in this case, it would be
unduly speculative to place significant weight on their convenience.”).
Thus, the convenience of the parties does not weigh in favor of
transfer at this time.
Convenience of the Witnesses
Concerning the convenience of the witnesses, defendants contend that
This, too, may not be accurate, as defendants
relating only to current SBCs. See (Doc. 14-1 at
However, the potential opt-in plaintiffs
defendants’ current SBCs; plaintiff himself is no
defendants. See (Doc. 1 at ¶¶ 6, 24.)
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¶ 27; Doc. 22-1 at
are not limited to
longer employed by
corporate employees, executive-level corporate employees, human resources
department employees, and payroll department employees.
work at defendants’ corporate headquarters and reside in the Buffalo
Grove, Illinois area.6
(Doc. 14-1 at ¶¶ 16-17.)
As with the convenience-of-the-parties factor, the court is unable
to determine at this time whether the convenience of the witnesses weighs
in favor of transfer.
Although defendants have identified potential
witnesses who work and reside in the Northern District of Illinois, it
may be that more SBCs residing in the Eastern District of Missouri or
elsewhere opt-in as plaintiffs and testify at trial than SBCs residing
in the Northern District of Illinois.
Moreover, SBCs could decline to
opt-in as plaintiffs but nonetheless retain relevant information and
approximately 420 SBCs; the number of past SBCs is unknown.
at ¶ 26.)
Given their number and importance, depending on their
involvement in this action, the convenience of the SBCs is of substantial
As discussed above, the SBCs involvement in this action and their
convenience is too speculative to evaluate at this time.
v. Solvay Pharm., Inc., No. 3:10CV36-HEH, 2010 WL 2163876, at *3 (E.D.
Va. May 27, 2010) (explaining that witness convenience did not justify
transfer at that time and declining “to speculate as to what added
convenience the [alternate] venue would provide if [the] claim [were to]
become a collective action”); Clayton v. Heartland Res., Inc., No.
(declining to speculate as to witness convenience where “[n]either party
. . . provided the court with the precise numbers of witnesses located
in [either state]” and where “witnesses located outside of both [states]
[would] be required to travel to trial in any circumstance”); Talbot v.
Defendant St. Mary’s Hosp. & Med. Ctr., Inc., No. 07-cv-02669-ZLW-CBS,
To the extent so required, defendants have specifically identified
these potential witnesses. (Doc. 22-1 at ¶¶ 4-8); see Standard Office
Sys. v. Ricoh Corp., 742 F. Supp. 534, 538 (W.D. Ark. 1990) (“The party
seeking the transfer must clearly specify the key witnesses to be called
and must make a general statement of what their testimony will cover.”
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2008 WL 1766644, at *2 (D. Colo. Apr. 16, 2008) (“[A]t this early stage
the Court cannot determine the relative materiality of the two broad
categories of witnesses, and it has not yet been determined which and how
many of these witnesses actually will testify.”).
Beyond their numbers, the SBCs’ testimony also appears to be at
least as important as defendants’ corporate employees’ testimony.
Terra, 119 F.3d at 696 (agreeing with the district court that “sheer
numbers of witnesses will not decide which way the convenience factor
tips” (citation omitted)); Preston v. Missouri-Nebraska Express, Inc.,
No. 91-0056-CV-W-6, 1991 WL 626751, at *2 (W.D. Mo. Oct. 16, 1991)
(“[W]itness convenience and availability is not a numbers game where the
only consideration is where the most witnesses are located.
Defendants note the inconvenience and disruption to their business
operations that would be caused by litigating this action in the Eastern
District of Missouri rather than in the Northern District of Illinois.
See (Doc. 14-1 at ¶¶ 15, 18-19.)
Courts have afforded similar arguments
Compare Carnegie Mellon Univ. v. Marvell Tech. Group,
Ltd., No. 09-290, 2009 WL 3055300, at *4 (W.D. Pa. Sept. 21, 2009)
(stating that the potential disruption to the defendants’ business
operations and to the defendants’ employees’ schedules were irrelevant
to the transfer analysis because these factors “[did] not concern
nonparty witnesses, and [did] not claim actual unavailability for trial”)
with Wayne Cnty. Emps.’ Ret. Sys. v. MGIC Inv. Corp., 604 F. Supp. 2d
consideration should also be given to the potential disruption of the
defendant’s business caused by the absence of its employees from the
jurisdiction during the litigation.” (citation omitted)).
given the uncertainty as to the involvement, residency, and convenience
of defendants’ currently-employed SBCs, the potential disruption to
defendant’s business operations is itself unclear.
Defendants also assert that the United States District Court for the
Northern District of Illinois is in a greater position to ensure the
appearance of witnesses, namely defendants’ corporate employees, at
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However, “the availability of compulsory process is not an
overriding concern because, as a practical mater, defendant’s employees
will be available to testify by virtue of their employment relationship.”
Sirico v. RIH Acquisitions NJ, LLC, No. 1:06-cv-3262-ENV-RLM, 2006 WL
3370399, at *2 (E.D.N.Y. Nov. 20, 2006); accord Hyman v. Hill & Assocs.,
No. Civ.A. 05 C 6486, 2006 WL 328260, at *3 (N.D. Ill. Feb. 9, 2006)
(“[E]mployees of parties are irrelevant to the convenience analysis.”).
In short, whether litigating this action in the Northern District
determined at this time.
Given the importance of this factor,7 the court
avoids speculating as to who the witnesses will be, how important their
testimony will be, and ultimately, whether the convenience of the
witnesses weighs in favor of transfer.
Location of Documentary Evidence
Defendants also argue that the case should be transferred because
their corporate records related to their wage and hour practices—employee
policies—are located at their corporate headquarters in Buffalo Grove.
“[W]ith the advent of photocopying and other means of document
reproduction, the location of documents is no longer entitled to much
weight in the transfer of venue analysis, especially where, as here, the
parties have the financial capability to complete the necessary copying.”
Jones v. Casey’s Gen. Stores, Inc., No. C07-4043-MWB, 2007 WL 2479666,
at *4 (N.D. Iowa Aug. 30, 2007); see also Johnson v. VCG Holding Corp.,
767 F. Supp. 2d 208, 216 (D. Me. 2011) (noting that the location-andavailability-of-documents factor “seems like a holdover from a time when
businesses kept important records, including payroll records, in paper
and the difficulty of physically accessing the paper documents and the
burden of transporting them across jurisdictions could be onerous”);
E.g., CitiMortgage, Inc. v. Somonich Corp., 4:10 CV 1568 HEA, 2011
WL 4600698, at *1-2 (E.D. Mo. Oct. 3, 2011) (stating that this is “the
most important factor in passing on a motion to transfer under
§ 1404(a)”); Ozarks Coca-Cola/Dr. Pepper Bottling Co. v. Coca-Cola Co.,
No. 06-03056-CV-W-GAF, 2006 WL 696461, at *4 (W.D. Mo. Mar. 17, 2006)
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Marcus v. Am. Contract Bridge League, 562 F. Supp. 2d 360, 366 (D. Conn.
2008) (“[T]he location of the relevant documents is a non-issue in
today’s world because copy machines, electronic discovery, and emails
make it much easier to obtain documents at a distance.”).
Assuming that the documentary evidence is located primarily within
the Northern District of Illinois and thus favors transfer,8 this factor
is nonetheless entitled to little weight.
Plaintiff’s Choice of Forum
The parties dispute the proper weight that should be afforded to
plaintiff’s choice of forum.
Compare Jewell v. Aaron’s, Inc., No. 1:11-
cv-02314-DCN, 2012 WL 589488, at *4 (N.D. Ohio Feb. 22, 2012) (noting,
in an FLSA collective action, that the “[p]laintiff’s choice of forum
does not tip the balance because it is not a single-plaintiff action”)
with Hernandez v. Tex. Capital Bank, N.A., No. 07-0726-CV-W-ODS, 2008 WL
342758, at *4 (W.D. Mo. Feb. 5, 2008) (affording the plaintiffs’ choice
of forum significant weight in an FLSA collective action because the
“opt-in structure suggests that Congress intended to give plaintiffs
considerable control over the bringing of a FLSA action” (citation
Regardless of the weight to be afforded, plaintiff’s choice of forum
favors litigating this action in the Eastern District of Missouri.
Balance of Factors
For the reasons discussed above, defendants have not met their
burden of showing that the § 1404(a) factors “strongly” favor transfer
of this action to the Northern District of Illinois at this time.
33 F. Supp. 2d at 1121.
Defendants may refile their motion when the
involvement, residency, and convenience of their past and current SBCs
becomes more apparent.
Therefore, defendants’ motion to transfer (Doc. 13) is denied
This, of course, does not take into account plaintiff’s documentary
evidence or the documentary evidence that the opt-in plaintiffs may
possess outside of the Northern District of Illinois.
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Motions to Dismiss
28 U.S.C. § 1391
Defendants first argue that 28 U.S.C. § 1391,9 which “govern[s] the
venue of all civil actions brought in district courts of the United
States,” requires that the court have specific jurisdiction over a
defendant for venue to be appropriate in the court’s district. 28 U.S.C.
Section 1391(b)(1) states that, regarding venue, “[a]
civil action may be brought in . . . a judicial district in which any
defendant resides, if all defendants are residents of the State in which
the district is located . . . .”
Id. at (b)(1).
rests primarily on a clause in § 1391(c)(2), which states that a
defendant is deemed to reside “in any judicial district in which such
defendant is subject to the court’s personal jurisdiction with respect
to the civil action in question . . . .”
Id. at (c)(2) (emphasis added).
Defendants argue that the phrase “with respect to the civil action in
question” of § 1391(c)(2) should be construed so as to require that the
court have specific jurisdiction over a defendant in order for venue to
be proper in the court’s district.
Because, as discussed below, the court concludes that it has
specific jurisdiction over defendants, the court need not address whether
When a motion to dismiss challenges the existence of personal
jurisdiction, the plaintiff bears the burden of establishing that the
court has personal jurisdiction over the defendant.
K-V Pharm. Co. v.
J. Uriach & CIA, S.A., 648 F.3d 588, 591-92 (8th Cir. 2011); Pangaea,
Inc. v. Flying Burrito LLC, 647 F.3d 741, 745 (8th Cir. 2011).
court does not hold a pretrial evidentiary hearing on the issue of
personal jurisdiction, the plaintiff need only make a prima facie showing
“There is no special venue provision for FLSA claims, so the
general venue provisions of 28 U.S.C. § 1391 govern [such a] case.”
Bredberg v. Long, 778 F.2d 1285, 1287 (8th Cir. 1985).
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of jurisdiction based on the pleadings, affidavits, and exhibits. Miller
v. Nippon Carbon Co., Ltd., 528 F.3d 1087, 1090 (8th Cir. 2008); Dakota
Indus., Inc. v. Dakota Sportswear, Inc., 946 F.2d 1384, 1387 (8th Cir.
1991). The evidentiary showing required at this stage is “minimal.” K-V
Pharm., 648 F.3d at 592.
Although the plaintiff bears the burden of
proof, the court views the facts in the light most favorable to the
plaintiff and resolves all factual conflicts in the plaintiff’s favor.
Pangaea, 647 F.3d at 745.
Typically, when the court has federal question subject matter
jurisdiction over an action, the relevant constitutional limits on the
court’s power to exercise personal jurisdiction stem from the Due Process
Clause of the Fifth Amendment.
Omni Capital Int’l, Ltd. v. Rudolf Wolff
& Co., Ltd., 484 U.S. 97, 104 (1987).
However, for the court’s exercise
of personal jurisdiction to be proper, “[t]here must also be a basis for
the defendant’s amenability to service of summons.”
“establishes personal jurisdiction over a defendant . . . when authorized
by a federal statute.”
Fed. R. Civ. P. 4(k)(1)(C).
When the relevant
federal statute is silent as to service of process, the court must
instead look to the forum state’s long-arm statute.10
Fed. R. Civ. P.
4(k)(1)(A) (serving a summons establishes personal jurisdiction over a
defendant who is subject to the jurisdiction of the courts of the state
in which the district court sits); Fed. R. Civ. P. 4(e)(1)11 (when the
relevant federal statute is silent, service may be effectuated in
accordance with the law of the state in which the district court sits);
e.g., Mobile Anesthesiologists Chicago, LLC v. Anesthesia Assocs. of
Houston Metroplex, P.A., 623 F.3d 440, 443 (7th Cir. 2010); uBID, Inc.
v. GoDaddy Grp., Inc., 623 F.3d 421, 425 (7th Cir. 2010); Sunward Elecs.,
This is not a situation in which the defendants are “not subject
to jurisdiction in any state’s courts of general jurisdiction.” Fed. R.
Civ. P. 4(k)(2).
The standards of Rule 4(e)(1) are applicable to corporations
pursuant to Rule 4(h)(1)(A). See Fed. R. Civ. P. 4(h)(1)(A)(stating that
a corporation can be served “in the manner prescribed by Rule 4(e)(1) for
serving an individual”).
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Inc. v. McDonald, 362 F.3d 17, 22 (2d Cir. 2004); Sculptchair, Inc. v.
Century Arts, Ltd., 94 F.3d 623, 626-27 (11th Cir. 1996); Wallace v.
Mathias, ___ F. Supp. 2d ___, 2012 WL 1807334, at *4-6 (D. Neb. May 17,
Because the FLSA is silent as to service of process, the court can
exercise personal jurisdiction only to the extent permitted by Missouri’s
long-arm statute and the Due Process Clause of the Fourteenth Amendment.12
Lovett v. Sanderson, 184 F.3d 819, 1999 WL 500691, at *1 (5th Cir. 1999);
Aviles v. Kunkle, 978 F.2d 201, 203-04 (5th Cir. 1992); Wallace, 2012 WL
1807334, at *6; Wang v. Schroeter, No. 11-10009-RWZ, 2011 WL 6148579, at
*4 (D. Mass. Dec. 9, 2011); In re Enter. Rent-A-Car Wage & Hour Emp.
Practices Litig., 735 F. Supp. 2d 277, 307-08 (W.D. Pa. 2010).
Due Process Clause
The Due Process Clause requires that there be sufficient minimum
contacts between the defendant and the forum state, “such that the
maintenance of the suit does not offend ‘traditional notions of fair play
and substantial justice.’ ”
J. McIntyre Mach., Ltd. v. Nicastro, ___
U.S. ___, 131 S. Ct. 2780, 2787 (2011) (quoting Int’l Shoe Co. v.
Washington, 326 U.S. 310, 316 (1945)). These minimum contacts must arise
because the defendant has “purposefully avail[ed] itself of the privilege
of conducting activities within the forum State, thus invoking the
benefits and protections of its laws.”
Hanson v. Denckla, 357 U.S. 235,
253 (1958); accord Pangaea, 647 F.3d at 745.
This “ensures that a
defendant will not be haled into a jurisdiction solely as the result of
random, fortuitous, or attenuated contacts, or of the unilateral activity
of another party or a third parson.” Burger King Corp. v. Rudzewicz, 471
U.S. 462, 475 (1985) (citations omitted).
The Eighth Circuit has established a five-factor test to determine
whether a defendant has sufficient minimum contacts with the forum state
so as to confer personal jurisdiction:
This is “the same personal jurisdiction inquiry, and concomitant
‘minimum contacts’ analysis” as when the court exercises diversity of
citizenship subject matter jurisdiction.
Wang v. Schroeter, No. 1110009-RWZ, 2011 WL 6148579, at *4 (D. Mass. Dec. 9, 2011).
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(1) the nature and quality of the contacts with the forum
state; (2) the quantity of the contacts; (3) the relationship
of the cause of action to the contacts; (4) the interest of
[the forum state] in providing a forum for its residents; and
(5) the convenience or inconvenience to the parties.
Johnson v. Arden, 614 F.3d 785, 794 (8th Cir. 2010).
first three factors are primary factors and the remaining two factors
are secondary factors,” id., the court should “look at all of the factors
and the totality of the circumstances in deciding whether personal
K-V Pharm., 648 F.3d at 592-93.
“The third factor distinguishes whether the jurisdiction is specific
Johnson, 614 F.3d at 794.
Specific jurisdiction arises
“when a defendant, through its contacts with the forum, purposefully
avails itself of the privilege of conducting business in the forum,” and
the plaintiff’s claim “aris[es] out of or relat[es] to” the defendant’s
omitted). General jurisdiction exists when a defendant has “ ‘continuous
and systematic’ ” contacts with the forum state so as “to render [the
defendant] essentially at home in the forum State.”
Tires Operations, S.A. v. Brown, ___ U.S. ___, 131 S. Ct. 2846, 2851
(2011) (quoting Int’l Shoe, 326 U.S. at 317).
The court concludes that defendants have sufficient minimum contacts
with Missouri, such that the court’s exercise of personal jurisdiction
over defendants comports with due process.
Although plaintiff was
originally an Ohio resident when defendants hired him, he became a
Missouri resident during a portion of the relevant time period in which
he was allegedly wrongfully denied certain wages. (Doc. 12-2.) At least
13 of defendants’ other current SBCs are also Missouri residents.
12-1 at ¶ 27.)
While minimum contacts cannot derive solely from a plaintiff’s
unilateral action, Burger King, 471 U.S. at 475, defendants in this case
are alleged to transact business nationwide, including in Missouri.
(Doc. 1 at ¶¶ at 4-5, 8; Doc. 12-1 at ¶ 4.)
Defendants’ SBCs travel to
(Id. at ¶¶ 7-9.)
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Plaintiff’s claim arises, in
part, from defendants’ alleged failure to pay him wages for his time
working, among other places, in Missouri.13
(Id. at ¶¶ 10, 25-34.)
In addition, Missouri has an interest in adjudicating allegations
of labor law violations occurring within its borders and to the detriment
of its residents.
As discussed above, at this stage of the proceedings,
litigating this action in Missouri is convenient for plaintiff and not
overly inconvenient to defendants; the convenience of the parties, at
this time, is neutral.
K-V Pharm., 648 F.3d at 595 (the convenience-to-
the-parties factor was “neutral” where the potential inconvenience would
be the same for either party depending on where the trial would be held).
conducted business in Missouri, registered with the Missouri Secretary
of State, and appointed an agent for service of process in Missouri.14
At the hearing, defendants sought dismissal of GPS USA, Inc. and
Integrated Business Analysis, Inc., because these defendants were not
plaintiff’s employer. However, the complaint alleges that “[p]laintiff
was formerly employed as an SBC by [d]efendants” and makes all
allegations against all defendants. (Doc. 1 at ¶ 2); see also n.1. At
this stage of the proceedings, the court “look[s] at the facts in the
light most favorable to [plaintiff], and resolve[s] all factual conflicts
in favor of [plaintiff].”
Pangaea, 647 F.3d at 745.
allegations of the complaint are sufficient at this time as to all
The parties dispute whether defendants consented to the exercise
of personal jurisdiction by virtue of registering with the Missouri
Secretary of State and appointing an agent for service of process in
Missouri. (Doc. 18-1.) In applying Minnesota’s long-arm statute, the
Eighth Circuit held that such conduct constituted consent to personal
jurisdiction. Ytuarte v. Gruner & Jahr Printing and Pub. Co., 935 F.2d
971, 973 (8th Cir. 1991); Knowlton v. Allied Van Lines, 900 F.2d 1196,
1200 (8th Cir. 1990). Missouri courts have not yet decided whether such
conduct, without more, should be construed as consenting to the exercise
of personal jurisdiction. See State ex rel. K-Mart Corp. v. Holliger,
986 S.W.2d 165, 168 (Mo. 1999) (en banc) (declining to “address the issue
of whether registration of a foreign corporation and designation of an
agent for service of process, without more, is always sufficient to
confer jurisdiction”). That said, then-Chief Judge Howard Sachs of the
United States District Court for the Western District of Missouri has
held that “a foreign corporation’s appointment of an agent for service
of process constitutes the consent of that corporation to submit to
jurisdiction of the courts of Missouri.” Koch Supplies, Inc. v. Charles
Needham Indus., No. 86-1330-CV-W-9-6, 1990 WL 274485, at *3 (W.D. Mo.
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defendants could have “reasonably anticipate[d] being haled into court
World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297
In light of defendants’ contacts with Missouri, the exercise of
personal jurisdiction over them comports with due process.
Having found that the exercise of personal jurisdiction comports
with due process, the court turns to whether it has specific or general
jurisdiction over defendants.
“[A] prima facie case of specific personal jurisdiction can only be
established if [the defendant] ‘has purposefully directed its activities
at [the forum state’s] residents,’ and the claim of th[e] suit either
‘arises out of’ or ‘relates to’ these activities.”
Lakin v. Prudential
Sec., Inc., 348 F.3d 704, 707 (8th Cir. 2003) (quoting Burger King, 471
authorized only to the extent that the cause of action arose out of an
activity covered by Missouri’s long-arm statute.”
Viasystems, 646 F.3d
at 593 (citation omitted). “[I]f a defendant commits any one of the acts
specified in the long-arm statute, the statute will be interpreted ‘to
provide for jurisdiction, within the specific categories enumerated in
the statute, to the full extent permitted by the Due Process Clause.’ ”
Id. (quoting State ex rel. Metal Serv. Ctr. of Ga., Inc. v. Gaertner, 677
S.W.2d 325, 327 (Mo. 1984) (en banc)).
Missouri’s long-arm statute, Mo. Rev. Stat. § 506.500.1, authorizes
the exercise of personal jurisdiction over an entity that transacts
Mo. Rev. Stat. § 506.500.1(1).
“The statute is construed
broadly, such that a single transaction can justify jurisdiction if it
Nov. 14, 1990).
Because the court concludes that it has specific jurisdiction over
defendants based on their contact with Missouri and based on plaintiff’s
claim, the court need not resolve this issue.
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is the transaction sued upon.”
Singh v. M/S Crompton Greaves Ltd., No.
4:11 CV 1207 SNLJ, 2011 WL 5833969, at *6 (E.D. Mo. Nov. 18, 2011).
The court concludes that plaintiff’s claim arises out of defendants’
contacts with Missouri, such that the court has specific jurisdiction
over defendants in this action. As previously noted, defendants transact
business nationwide, including in Missouri.
(Doc. 1 ¶¶ at 4-5, 8; Doc.
12-1 at ¶ 14.) Plaintiff’s claim arises from defendants’ alleged failure
to pay wages for his time spent working, among other places, in Missouri.
(Id. at ¶¶ 25-34.)
Because plaintiff’s claim arise out of defendants’
business transactions in Missouri, that is, defendants’ alleged failure
to pay plaintiff wages for work performed in Missouri, the Missouri longarm
defendants in this action.
In similar circumstances, other courts have found that employers’
actions gave rise to specific jurisdiction.
Compare Burris v. Bangert
Computer Sys., Inc., No. 2:09-cv-201-FtM-29DNF, 2009 WL 3256477, at *4
(M.D. Fla. Oct. 7, 2009) (Florida court had specific jurisdiction over
the Iowa employer in an FLSA action where the employee was a Florida
resident and worked primarily in Florida, even though the employer
conducted no business in Florida); Chao v. Benitez Drywall, LLC, Civil
Case No. H-06-2762, 2007 WL 781760, at *4-5 (S.D. Tex. Mar. 12, 2007)
(Texas court had specific jurisdiction in an FLSA action over the
Mississippi employer where the employees were Texas residents and the
employer communicated with the employees about work for which the
employees sought overtime wages while they were in Texas) with Lovett,
1999 WL 500691, at *3 (Louisiana court did not have specific jurisdiction
in an FLSA action where the employers “did not engage in any activity
within Louisiana that affected that state’s residents” and the employers’
only contact with Louisiana was that the employers’ sole shareholder was
a Louisiana resident who recommended the overtime wage policy at issue);
Azamar v. Stern, 662 F. Supp. 2d 166, 172 (D.D.C. 2009) (District of
Columbia court did not have specific jurisdiction in an FLSA action
because the employees’ allegedly uncompensated work occurred primarily,
if not entirely, in Virginia); Jason v. UNITE HERE, No. C05-820 JLR, 2005
WL 3278004, at *3 (W.D. Wash. Dec. 2, 2005) (Washington court did not
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have specific jurisdiction in an FLSA action where no employee worked in
Washington and no employee allegedly worked without proper compensation
while being a Washington resident).
Defendants argue that the court does not have specific jurisdiction
because the wage policy at issue was drafted in Illinois, not Missouri.
At least one other court has rejected a similar argument.
1999 WL 500691, at *3 (“[A] foreign corporation’s mere adherence to a
policy set in a forum state is not the kind of activity encompassed by
the doctrine of specific jurisdiction.”).
To the extent the location of
the origination of the wage policy at issue is relevant, it is not
determinative of whether the court has specific jurisdiction in either
that forum or another.
In this case, plaintiff, a Missouri resident, raises a claim based
on defendants’ alleged failure to pay him wages for work performed
nationwide, including in Missouri.
“[A] court may exercise specific
litigation results from injuries arising out of, or relating to, those
Cheyenne Prods., S.A. v. Berry, No. 4:09 CV 166 AGF, 2011
WL 4014368 (E.D. Mo. Sept. 9, 2011).
On this basis, the court has
specific jurisdiction over defendants in this action.
Missouri’s Long-Arm Statute
above, the court has personal jurisdiction over
defendants under Missouri’s long-arm statute, Mo. Rev. Stat. § 506.500.1,
because defendants transacted business in Missouri and those transactions
are the basis for plaintiff’s claim.
Mo. Rev. Stat. § 506.500.1(1).
In sum, exercising jurisdiction over defendants in this action
comports with the Due Process Clause of the Fourteenth Amendment and the
Missouri long-arm statute.
As discussed above, defendants conducted
Defendants hired Missouri residents as SBCs, at least one of
whom, plaintiff, allegedly worked without compensation in Missouri.
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is this allegedly uncompensated time that is, at its core, the basis for
Under these circumstances, the court has personal
jurisdiction over defendants in this action.
IT IS HEREBY ORDERED that the motion of defendants to dismiss for
lack of personal jurisdiction (Doc. 10) is denied.
IT IS FURTHER ORDERED that the motion of defendants to dismiss for
improper venue (Doc. 11) is denied.
IT IS FURTHER ORDERED that the motion of defendants to transfer
venue (Doc. 13) is denied without prejudice.
David D. Noce
UNITED STATES MAGISTRATE JUDGE
Signed on May 31, 2012.
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