REHRER v. ATIYEH et al

Filing 23

MEMORANDUM OPINION filed. Signed by Judge Michael A. Shipp on 9/25/2015. (eaj)

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

JERRY REHRER,
Plaintiff,
v.

Civil Action No. 14-8031 (MAS) (TJB)
MEMORANDUM OPINION

GEORGE ATIYEH, et al.,
Defendants.

SHIPP, District Judge
This matter comes before the Court on Defendant Robert K. Varano' s ("Varano") motion
to dismiss Plaintiff Jerry Rehrer' s ("Plaintiff') Complaint for lack of personal jurisdiction pursuant
to Federal Rule of Civil Procedure 12(b)(2). (ECF No. 4.) Plaintiff has opposed the motion (ECF
No. 5), and Varano has replied (ECF No. 6). The Court has carefully considered the parties'
submissions and decides the matter without oral argument pursuant to Local Civil Rule 78.1. For
the reasons stated below, the Court grants Varano's motion to dismiss.
I.

Background
Plaintiff brings suit against Varano asserting claims for breach of fiduciary duty and

fraudulent inducement. Plaintiff brings separate claims against George Atiyeh ("Atiyeh")
(collectively, with Varano, "Defendants"), 1 individually and doing business as Northeast

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A third defendant, Harry Brill, was voluntarily dismissed from the action on April 14, 2015. (ECF
No. 19-1.)

Apartments, LLC, House Flex, LLC, and Garage Flex, LLC (collectively, "Northeast") 2 for breach
of contract and covenant of good faith and fair dealing, unjust enrichment, tortious inference with
contract, and fraudulent inducement. (Compl. ifif 8-13, ECF No. 4-5.) Plaintiff alleges that Atiyeh
and Brill met Plaintiff at his home in Point Pleasant, New Jersey to discuss Plaintiffs acquisition
of Brill's fifty-percent ownership stake in Northeast. (Id.

ifif 16-18.) After some negotiation,

Plaintiff agreed to buy out Brill' s ownership stake. (Id. if 21.) Plaintiff and Atiyeh visited Varano' s
principal place of business in Mount Carmel, Pennsylvania to hire Varano to draft the contract
reflecting Plaintiffs ownership in Northeast. 3 (Compl.

ifif 22, 33, ECF No. 4-6.) Plaintiff alleges

that Varano breached a fiduciary duty when Varano failed to disclose his knowledge of several
pending lawsuits against Atiyeh and Northeast. (Id.

ifif 48, 59.) Plaintiff further alleges that,

because of Varano' s breach of fiduciary duty, Plaintiff was defrauded of funds and proceeds paid
to Northeast. (Id.)
II.

Legal Standard

A motion to dismiss for lack of personal jurisdiction is governed by Federal Rule of Civil
Procedure 12(b)(2). The plaintiff has the burden to prove facts sufficient to establish personal
jurisdiction by a preponderance of the evidence. Carteret Sav. Bank, FA v. Shushan, 954 F .2d 141,
146 (3d Cir. 1992). In deciding a Rule 12(b)(2) motion to dismiss, "a court is required to accept
plaintiffs allegations as true, and is to construe disputed facts in favor of the plaintiff." Toys "R"
Us, Inc. v. Step Two, SA., 318 F.3d 446, 457 (3d Cir. 2003). Once a defendant raises a
jurisdictional defense, "the plaintiff bears the burden of establishing with reasonable particularity

2

These companies are Pennsylvania limited liability companies used to purchase numerous
investment rental properties and assets in Pennsylvania. (Compl. if 2.)

3

The contract between Plaintiff and Atiyeh was signed on June 5, 2013, in Mount Carmel,
Pennsylvania. (Deel. of Robert K. Varano, Esq. ("Varano Deel."), ECF No. 4-6.)
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sufficient contacts between the defendant and the forum state to support jurisdiction." Provident
Nat. Bank v. Cal. Fed. Sav. & Loan Ass 'n, 819 F.2d 434, 437 (3d Cir. 1987) (citing Gehling v. St.
George's Sch. ofMed., Ltd., 773 F.2d 539, 542 (3d Cir. 1985)). A plaintiff"must sustain its burden

of proof in establishing jurisdictional facts through sworn affidavits or other competent evidence;
reliance on the bare pleadings is not enough." Patterson by Patterson v. FB.1, 893 F.2d 595, 604
(3d Cir. 1990). "Once the plaintiff has shown minimum contacts, the burden shifts to the defendant,
who must show that the assertion of jurisdiction would be unreasonable." Ameripay, LLC v.
Ameripay Payroll, Ltd., 334 F. Supp. 2d 629, 632 (D.N.J. 2004) (citing Mellon Bank (East) PSFS
v. Farino, 960 F.2d 1217, 1226 (3d Cir. 1992)).

III.

Analysis

A district court is authorized to "assert personal jurisdiction over a non-resident to the
extent permissible under the law of the state where the district court sits." Messalic v. Fiberfloat
Corp., 897 F.2d 696, 698 (3d Cir. 1990) (citing Fed. R. Civ. P. 4(e)). New Jersey's long-arm statute

permits jurisdiction "coextensive with due process requirements of the United States
Constitution." Miller Yacht Sales, Inc. v. Smith, 384 F.3d 93, 96 (3d Cir. 2004).
Personal jurisdiction over a nonresident defendant may be asserted under two theories of
jurisdiction: general or specific. See Dollar Sav. Bank v. First Sec. Bank of Utah, NA., 746 F.2d
208, 211 (3d Cir. 1984). Here, the Court's inquiry is limited to specific jurisdiction because
Plaintiff has not alleged that nonresident Varano's contacts with the forum are so "continuous and
systematic" to give rise to general jurisdiction. 4 See Provident Nat. Bank, 819 F.2d at 437.
"Specific jurisdiction is established when a nonresident defendant has 'purposefully directed' his

4

It is undisputed that at the time of service that Varano was a citizen of the Commonwealth of
Pennsylvania and was served therein.
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activities at a resident of the forum and the injury arises from or is related to those activities." Gen.

Elec. Co. v. Deutz AG, 270 F.3d 144, 150 (3d Cir. 2001) (quoting Burger King Corp. v. Rudzewicz,
471 U.S. 462, 472 (1985)). In other terms, "[s]pecific jurisdiction exists only where the defendant
has sufficient minimum contacts with the forum state that it 'should reasonably anticipate being
haled into court there."' Mellon Bank (East) PSFS, NA. v. DiVeronica Bros., Inc., 983 F.2d 551,
554 (3d Cir. 1993) (quoting WorldWide Volkswagen Corp. v. Woodson, 44 U.S. 286, 297 (1980)).
"So long as it creates a 'substantial connection' with the forum, even a single act can support
jurisdiction," and "territorial presence frequently will enhance a potential defendant's affiliation
with a State and reinforce the reasonable foreseeability of suit there." Rudzewicz, 471 U.S. at 475
n.18, 4 76 (quoting McGee v. Int 'l Life Ins. Co., 355 U.S. 220, 223 (1957)); see also Deutz AG, 270
F .3d at 150 ("Specific jurisdiction frequently depends on physical contacts with the forum. Actual
presence during pre-contractual negotiations, performance, and resolution of post-contract
difficulties is generally factored into the jurisdictional determination."). Because the existence of
specific jurisdiction depends on a link between the defendant's activity and the resulting harm,
specific jurisdiction is necessarily claim- and defendant-specific. Arlandson v. Hartz Mountain

Corp., 792 F. Supp. 2d 691, 698 (D.N.J. 2011).
Once minimum contacts have been established, the Court must ensure that its jurisdiction
"comport[s] with 'fair play and substantial justice."' Rudzewicz, 471 U.S. at 476 (quoting Int'!

Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)). Considerations include "the burden on the
defendant, the forum State's interest in adjudicating the dispute, the plaintiffs 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 4 76-77 (internal quotation marks omitted).

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However, in order to defeat jurisdiction otherwise supported by substantial and targeted contacts,
these factors "must present a compelling case . . . render[ing] jurisdiction unreasonable." Id at
477.
In this case, Plaintiff has not satisfied the Court that Varano has sufficient minimum
contacts to satisfy its exercise of specific personal jurisdiction over him. Plaintiff and Atiyeh
unilaterally approached Varano at his principal place of business in Mount Carmel, Pennsylvania
to draft their contract. (Compl. ifif 22, 33.) Varano never met with Plaintiff in New Jersey, (Varano
Deel., Ex. 6.), and Plaintiff has not shown that Varano has any ties to New Jersey. In addition, the
contract that Varano drafted for Plaintiff and Atiyeh pertained solely to property within the
Commonwealth of Pennsylvania. (Id) Plaintiff has also failed to provide any sworn affidavits or
competent evidence with his complaint or opposition to establish that Varano had sufficient
contacts with New Jersey.

In his opposition, Plaintiff argues that the Court has personal

jurisdiction over Varano because Brill and Atiyeh met Plaintiff at his home in Point Pleasant, New
Jersey on multiple occasions to discuss the contract in dispute. (Pl.'s Opp'n Br. 3) Plaintiff,
however, failed to provide any other support for this Court to exercise specific personal jurisdiction
over Varano. Plaintiffs support for the exercise of specific personal jurisdiction over Atiyeh and
Brill is not sufficient to support the exercise of specific personal jurisdiction over Varano.
Accordingly, Plaintiff failed to satisfy his burden of proof. Therefore, the Court grants Varano's
motion to dismiss for lack of personal jurisdiction.

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IV.

Conclusion
For the above reasons, the Court grants Varano's motion to dismiss. An order reflecting

this decision accompanies this Memorandum Opinion.

sf Michael A. Shipp
MICHAEL A. SHIPP
UNITED STATES DISTRICT JUDGE

Date: September 25, 2015

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