Dupee v. Playtika Santa Monica, LLC et al
Filing
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Memorandum Opinion and Order granting 10 Motion to dismiss for failure to state a claim filed by Caesars Interactive Entertainment, Inc., Playtika Santa Monica, LLC. Judge Christopher A. Boyko on 3/1/2016. (R,D)
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION
ROBERT DUPEE,
Plaintiff,
vs.
PLAYTIKA SANTA MONICA, et al.,
Defendants.
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CASE NO. 1:15CV1021
JUDGE CHRISTOPHER A. BOYKO
OPINION AND ORDER
CHRISTOPHER A. BOYKO, J.:
This matter comes before the Court upon Defendants Playtika Santa Monica, LLC
and Caesars Interactive Entertainment, Inc.’s Motion (ECF DKT No. 10) to Dismiss for Lack
of Personal Jurisdiction pursuant to Federal Rule of Civil Procedure 12 (b)(2). For the
following reasons, the Court GRANTS Defendants’ Motion to Dismiss.
I. Facts
Plaintiff, Robert Dupee (hereafter “Plaintiff”), alleges that Defendants, Playtika Santa
Monica, LLC (hereafter “Playtika SM” or “Defendant”) and Caesars Interactive
Entertainment, Inc (hereafter “CIE” or “Defendant”), have illegally profited through the
operation of a virtual casino under the name of “Slotomania.” Plainitff alleges three causes of
action: (1) violations of the Nevada Trade Practices Act, Nevada Rev. Stat. 41.600(2)(e)
(“NDTPA”), (2) violations of the Ohio Loss Recovery Statute, Ohio Rev. Code 3763.02
(“OLRS”), and (3) unjust enrichment.
According to the Complaint, Plaintiff, a resident of Ohio, began playing Slotomania
on or around June 2014 on his computer in Ohio. (Compl. ¶ 33). Slotomania is a “free-toplay” slot-themed game, available as an app on mobile devices and on several operating
platforms including Facebook and Yahoo. (Compl. ¶ 21). With “free-to-play” games,
consumers download and play the game for free, but are then able to purchase numerous low
cost items within the game itself. (Compl. ¶ 11). Slotomania users initially receive free
virtual coins that are then used to make wagers. (Compl.¶ 22). A winning outcome in
Slotomania awards only more virtual coins which are then used to continue playing the game.
(Compl. ¶¶ 3, 29, 30). Users who run out of virtual coins and wish to continue playing must
either wait until a free distribution of coins is made, or, if they choose, they may purchase
additional virtual coins. (Compl. ¶¶ 2, 23). Additional virtual coins may be purchased for
$1.99 for 7,500 coins up to $49.00 for 270,000. (Compl.¶ 24). Slotomania’s Terms of Use,
which users must agree to before they can play the game, state that the virtual coins can never
be redeemed for real money, and users cannot purchase, sell, or exchange the virtual coins
outside the service. (ECF DKT No. 10 at 10-1).
Between June 2014 and April 2015, Plaintiff spent over $12,000 playing Slotomania.
(Compl. ¶ 34). Plaintiff filed suit against Defendants, alleging that they have illegally
profited from their operation of Slotomania. (Compl. ¶ 4). Defendants now move to dismiss
this action pursuant to Fed. R. Civ. P. 12(b)(2), for lack of personal jurisdiction, arguing that
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Plaintiff has sued the wrong parties. Playtika SM is a limited liability company incorporated
in Nevada and principally based in California. (Compl. ¶ 6). CIE is incorporated in
Delaware and principally based in Nevada. (Compl. ¶ 7). Plaintiff alleges that personal
jurisdiction over Defendants is proper because they “conduct business” in Ohio through the
operation of Slotomania. (Compl. ¶ 9). Specifically, Plaintiff asserts that Defendants have
purposefully availed themselves of the forum state by selling virtual coins through
Slotomania. Plaintiff alleges no business other than the Defendants’ operation of Slotomania
in the state of Ohio.
Defendants assert that personal jurisdiction is improper because the they do not
operate Slotomania, do not conduct any business, or maintain any physical or legal presence
in Ohio. (ECF DKT No. 10 at 10-3). Defendants assert that Slotomania is operated by nonparty Playtika Ltd., a separate legal entity located in Israel. (ECF DKT No. 18). Defendants
point to the first sentence of Slotomania’s Terms of Service Agreement which reads, “ The
Terms of Service you are reading are a legal agreement between Playtika Ltd. and yourself.”
(ECF DKT No. 10 at 10-2). Plaintiff, in response to Defendants’ 12(b)(2) Motion to Dismiss,
asserts that the Caesars Acquisition Company Annual Report and Playtika SM’s LinkedIn
page are adequate evidence to establish that the Defendants control and operate Slotomania.
(ECF DKT No. 15). Plaintiff asserts that the Caesars Acquisition Company Annual Report
shows that CIE owns the Slotomania brand and directly profits from the operation of the
game. Similarly, Plaintiff asserts that Playtika SM represents its control, operation and
facilitation of Slotomania online, by listing Slotomania as a Playtika SM product on their
LinkedIn page.
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II. Issue
Defendants filed a Motion to Dismiss for Lack of Personal Jurisdiction pursuant to
Fed. R. Civ. P. 12(b)(2). Defendants assert that the Court should dismiss the claim because
the Court lacks personal jurisdiction over them and they are not the proper defendants. The
issue is whether Plaintiff has made a prima facie showing that Defendants’ contacts with Ohio
are sufficient to satisfy Ohio’s long-arm statute and the Due Process Clause under the
Fourteenth Amendment to support the District Court’s exercise of personal jurisdiction.
III. Law and Analysis
A. Legal Standard
When a court approaches a motion to dismiss for lack of personal jurisdiction based
solely on written materials and affidavits, “the burden on the plaintiff is relatively slight, [...]
and the plaintiff must make only a prima facie showing that personal jurisdiction exists in
order to defeat dismissal [ ] [...].” Ampco System Parking v. Imperial Parking Canada Corp.,
No. 1:11CV1172, 2012WL1066784, at *2 (N.D. Ohio Mar. 28, 2012) (quoting Air Prods. &
Controls, Inc., v. Safetech Int’l, Inc., 503 F.3d 544, 549 (6th Cir. 2007)). The court “does not
weigh the controverting assertions of the party seeking dismissal.” Dean v. Motel 6 Operating
L.P., 134 F.3d 1269, 1272 (6th Cir. 1998). Plaintiff need only establish jurisdictional claims
with “reasonable particularity” and the pleadings and affidavits are construed in the light
most favorable to plaintiff. Ampco, 2012WL1066784, at *2. The burden is on the plaintiff,
however, to establish that jurisdiction exists, and the plaintiff may not merely stand on his
pleadings in the face of a properly supported motion for dismissal. Theunissen v. Matthews,
935 F.2d 1454, 1458 (6th Cir. 1991). The plaintiff must set forth specific facts showing that
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the court has jurisdiction. Id. Therefore, dismissal is proper only if all the specific facts
which the plaintiff alleges collectively fail to state a prima facie case for jurisdiction.
CompuServe, Inc. v. Patterson, 89 F.3d 1257, 1262 (6th Cir. 1996).
B. Personal Jurisdiction
In deciding a motion to dismiss under Fed. R. Civ. P 12(b)(2), the Court applies a twostep inquiry when examining if it has personal jurisdiction over the parties. First, the Court
determines whether Ohio’s long-arm statute confers personal jurisdiction. If the Court
determines that the long arm statute confers personal jurisdiction, it then determines whether
exercising jurisdiction over the defendant comports with the Due Process Clause of the
Fourteenth Amendment.
1. Ohio’s Long Arm Statute (R.C. § 2307.382)
The pertinent section of the Ohio long-arm statute reads:
(A) A court may exercise personal jurisdiction over a person who acts directly or by
an agent, as to a cause of action arising from the person’s:
(1) Transacting business in this state; [or]
(2) Contracting to supply services or goods in this state; [or]
(3) Causing tortious injury by an act or omission in this state.
Plaintiff asserts that jurisdiction is proper in Ohio under sections (1), (2) and (3).
Plaintiff contends that Defendants transacted business within the state, contracted for the sale
of goods within the state, regularly solicited and conducted business within the state for profit
and knowingly injured individuals within the state.
a. Plaintiff Fails to Establish That Defendants Transact Business in Ohio or
Contract for the Supply of Goods or Services in Ohio
First, Plaintiff contends that Defendants are subject to personal jurisdiction in Ohio as
a result of transacting business and contracting for the sale of goods in Ohio. Specifically,
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Plaintiff alleges that by selling virtual coins for Slotomania, Defendants reached into the state
of Ohio and transacted business. The Ohio Supreme Court has held that to ‘transact business’
is to “prosecute negotiations; to carry on business; [or] to have dealings.” Faurecia Exhaust
Sys., Inc. v. Walker, 464 F. Supp. 2d 700, 705-06 (N.D. Ohio 2006) citing Kentucky Oaks
Mall Co. v. Mitchell’s Formal Wear, Inc., 53 Ohio St. 3d 73, 75 (1990). While Plaintiff’s
Complaint contains assertions which are sufficient to establish that Defendants’ transacted
business in Ohio, the Court is required to evaluate Defendants’ Motion to Dismiss for Lack of
Personal Jurisdiction under the standard which requires Plaintiff to support personal
jurisdiction by affidavit or otherwise to support his factual assertions. Theunissen, 935 F.2d
at 1458.
In support of their Motion to Dismiss, Defendants’ submitted the declaration of
Michael Cohen, the Senior Vice President and General Counsel to Caesars Acquisition
Company, and the Slotomania Terms of Service agreement. (ECF DKT No.10 at 10-1, 10-3).
Cohen’s Declaration establishes that CIE indirectly owns Playtika SM, but neither CIE nor
Playtika SM operate, host or otherwise offer Slotomania. (ECF DKT No. 10 at 10-3).
Further, Cohen’s Declaration states that neither CIE nor Playtika SM is registered or
otherwise authorized to conduct business in the state of Ohio, and at no time has either entity
had employees, corporate files, bank accounts, offices or any other place of business in Ohio.
(Id.) Finally, Cohen’s Declaration states that, “Slotomania is offered and operated by
Playtika Ltd., a corporation organized under the laws of Israel and having its principal place
of business [in] . . . Tel Aviv, Israel.” (Id.) Defendants also submitted the Terms of Service
Agreement for Slotomania which states, “The Terms of Service (“Terms”) you are reading are
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a legal agreement between Playtika Ltd. (“Playtika”) and yourself (“You”). (ECF DKT No.
10 at 10-1).
In the face of a properly supported motion for dismissal, the plaintiff may not stand on
his pleadings but must, by affidavit or otherwise, provide specific facts showing that the court
has jurisdiction. Theunissen, 935 F.2d at 1458. Plaintiff has failed to properly provide the
Court by affidavit or otherwise, facts supporting his assertion that personal jurisdiction over
Defendants would be proper in this case. Rather, Plaintiff improperly relies on his pleadings
to establish that personal jurisdiction is proper. Plaintiff, in opposition to Defendants’
12(b)(2) Motion to Dismiss, asserts that the Caesars Acquisition Company Annual Report and
Playtika SM’s LinkedIn page both establish that Defendants transacted business in Ohio
through their operation of Slotomania. Although Plaintiff has failed to properly provide the
Court with specific facts showing that jurisdiction would be proper, the Court finds that even
after viewing the relied upon material in a light most favorable to Plaintiff, he has failed to
make a prima facie showing that jurisdiction would be proper.
Plaintiff asserts that the Caesars Acquisition Company Annual Report (hereafter
“Annual Report”) shows that CIE operates Slotomania and therefore transacts business in
Ohio. Specifically, Plaintiff alleges that the Annual Report shows that CIE owns the
Slotomania brand, associated trademarks, copyright, logos, software code, audio-visual
elements, graphics, technology and trade secrets. (ECF DKT No. 15). Further, Plaintiff
asserts that the Annual Report shows that CIE profits directly from its operation, facilitation
and control of Slotomania. (Id.) The fact that CIE profits from Slotomania and owns the
trademark and other intellectual property associated with Slotomania, does not establish that
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CIE controls the operations of Slotomania. In fact, upon closer review, the Annual Report
directly states that “[a] key portion of the operation and personnel of Playtika, a subsidiary
of CIE and the Operator of Slotomania, are located in Israel . . . .” (ECF DKT No. 18 at
18-1). For the purposes of the Annual Report, “Playtika” is defined as referring to Playtika
Ltd., a separate legal entity. (See Id. 10, 125; See Also Annual Report Exh. 21). The Annual
Report, which Plaintiff relies upon, indicates that Playtika Ltd. is a subsidiary of CIE and the
operator of Slotomania. CIE does not purposefully avail itself of the privilege of conducting
activities in the forum state merely by owning all or some of a corporation that is subject to
jurisdiction. See Dean, 134 F.3d at 1272, citing Keeton v. Hustler Magazine, 465 U.S. 770,
781 n.13 (1984) (holding that jurisdiction over a corporation does not necessarily result in
jurisdiction over holding company that owns it). Therefore, Plaintiff must provide sufficient
evidence for the Court to conclude that CIE is being brought into court for something it has
done, not for the actions of a subsidiary. Plaintiff has failed to point to any evidence in the
Annual Report to support his assertion that CIE transacts business in Ohio through the
operation of Slotomania. Rather, the Annual Report relied upon by Plaintiff indicates that
Slotomania is operated by Playtika Ltd., a subsidiary of CIE. Plaintiff alleges no business
other than the Defendants’ operation of Slotomania in the state of Ohio. Thus, the Annual
Report fails to support Plaintiff’s assertion that the Court has jurisdiction over CIE.
Next, Plaintiff relies on the LinkedIn page of Playtika SM to establish that Defendants
operate Slotomania and therefore transact business in Ohio. Plaintiff not only failed to
provide the Court with an authenticated copy of the relied upon webpage, but also failed to
provide a working web-link within his pleadings. Plaintiff alleges that Playtika SM
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represents their control, operation and facilitation of Slotomania by listing Slotomania as a
Playtika SM product on their LinkedIn page. Upon viewing the Playtika SM LinkedIn page,
the only reference to Slotomania is a graphic logo of Slotomania that appears on the webpage.
Further, Playtika SM’s LinkedIn page notes: “With 10 games on 14 platforms in 12
languages, Playtika is a global leader in social mobile games . . . .” (ECF DKT No. 18 at 183). This language, along with a graphic logo of Slotomania, does not establish that Playtika
SM specifically operates Slotomania. Thus, Playtika SM’s LinkedIn page fails to support
Plaintiff’s assertion that this Court has jurisdiction over Playtika SM.
b. Plaintiff Fails to Establish That Defendant Caused Tortious Injury to Plaintiff
in Ohio
Plaintiff argues that Defendants are subject to personal jurisdiction under Ohio’s longarm statute for causing tortious injury by an act in the state of Ohio. Plaintiff alleges that he
was injured in Ohio as a result of Defendants selling him virtual coins for an unlawful
gambling game. Plaintiff has failed to establish that Defendants operate and control the
virtual game Slotomania. Thus, Plaintiff is unable to establish that Defendants caused
tortious injury to him in Ohio and consequently, cannot establish personal jurisdiction under
the corresponding portion of Ohio’s long-arm statute.
2. Due Process
Plaintiff fails to make a prima facie showing that Defendants’ contacts with Ohio are
sufficient to satisfy Ohio’s long-arm statute. The Ohio long-arm statute does not extend to
the constitutional limits of personal jurisdiction required under the Constitution’s Due Process
Clause. See Conn v. Zakarov, 667 F.3d 705, 713 (2012) (noting “[O]hio does not have a
long-arm statute that reaches to the limits of the Due Process Clause, and the analysis of
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Ohio’s long-arm statute is a particularized inquiry wholly separate from the analysis of
Federal Due Process law.”) Since Plaintiff fails to satisfy the requirements of Ohio’s longarm statute for personal jurisdiction, the Court need not evaluate Defendants’ personal
jurisdiction under the Constitution’s Due Process Clause.
IV. Conclusion
Because Plaintiff has failed to establish personal jurisdiction over Defendants, the
Court need not address Defendants’ Motion to Dismiss based upon Forum Non Conveniens
and Failure to State a Claim. Accordingly, Defendants’ Motion to Dismiss for Lack of
Personal Jurisdiction is GRANTED.
IT IS SO ORDERED.
DATE: _3/1/2016_
S/Christopher A. Boyko
CHRISTOPHER A. BOYKO
United States District Judge
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