Allen et al v. IM Solutions, LLC et al

Filing 76

OPINION AND ORDER by District Judge James H. Payne: granting 31 Motion of Defendants IM Solutions, LLC and LeadingResponse to Dismiss (cjt, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF OKLAHOMA
ANTHONY L. ALLEN, et al.,
Plaintiff,
v.

Case No. CIV-14-213-JHP

IM SOLUTIONS, LLC, et al.,
Defendant.
OPINION AND ORDER
Now before the Court are the Motion to Dismiss of Defendants IM Solutions, LLC and
LeadingResponse [Doc. No. 31], Plaintiff’s Response to that motion [Doc. No. 51], and IM
Solutions, LLC’s and LeadingResponse’s Reply Brief in Support of Their Motion to Dismiss
[Doc. No. 57]. For the reasons set forth below, Defendants’ motion is GRANTED.
BACKGROUND
According to the Complaint filed on June 3, 2014, Plaintiffs are lawyers and their
respective law firms.

Plaintiff Anthony Allen is a resident of Muskogee, Oklahoma and

practices as a member of the firm of Allen & Wisner, LLC, an Oklahoma limited liability
company that has its principal office in Muskogee, Oklahoma. Plaintiff James E. Blount, IV is a
resident of Shelby County, Tennessee and practices as a member of the firm of Blount Law
Firm, PLLC, a Tennessee limited liability company that has its principal office in Collierville,
Tennessee. Blount alleges that he owns the internet domain names “901lawyers.com” and
“901lawyers.net;” Allen alleges that his firm’s website was hosted under the domain name
“oklahomaslawfirm.com” until April 2013, and after that date under the domain name
“allenwisner.com.”

Plaintiffs allege they own common law trademarks to their respective

individual and law firm names and to their website domain names. Plaintiffs allege that their
individual and firm names and their respective websites are inherently distinctive marks and are
marks that have acquired secondary meaning. The Complaint is filed as a putative class action
on behalf of all persons in the United States who provide professional legal services and who
utilize the Internet to publicize or advertise their services.1
Defendant IM Solutions, LLC (“IMS”) is alleged to be a Nevada limited liability
company with its principal place of business in Dallas, Texas.2 Defendant LeadingResponse is
alleged to be a limited liability company formed under the laws of an unknown jurisdiction and
having its principal place of business in Stamford, Connecticut.

However, the O’Sullivan

Declaration states that “LeadingResponse” is not a limited liability company but is the assumed
name by which RME Group Holding Company, a Delaware corporation (“RME”), does
business.3 For purposes of its discussion, the Court will treat RME as the real party in interest.4
Plaintiffs allege that IMS and RME (along with other Defendants) engaged in unfair
competition in violation of Lanham Act §43(a), 15 U.S.C. §1125(a), committed deceptive trade
practices that violate Okla. Stat. tit. 78, §§51 et seq., tortiously interfered with Plaintiffs’
prospective economic advantage protected by common law, and engaged in a civil conspiracy
Plaintiffs allege there are sub–classes of plaintiffs who reside and practice law in their respective
states, Oklahoma and Tennessee.
2
In a Declaration (“O’Sullivan Declaration”) attached to Defendants’ Motion to Dismiss, Robert
O’Sullivan, Executive Vice President, Business Development for IMS confirms that IMS is a
Nevada limited liability company but states that its principal place of business is in Plano, Texas.
The Court notes that Plano is a city in the Dallas–Fort Worth metropolitan area. The difference is
not significant to the Court’s jurisdictional analysis.
3
O’Sullivan’s statement is reiterated in the Declaration of Charles DallAcqua, RME’s Chief
Executive Officer (“DallAcqua Declaration”), attached to Defendants’ Reply Brief in Support of
Their Motion to Dismiss.
4
The Fictitious Name Certificate for RME attached to the O’Sullivan Declaration (see footnote 2)
states that RME’s principal place of business is in Tampa, Florida. Plaintiffs do not contest that
statement. For its jurisdictional analysis, the Court will therefore treat RME as a Delaware
corporation having its principal place of business in Florida.
1

2

with the other defendants. IMS and RME allegedly did so by causing “pop–up” advertisements
to appear on Plaintiffs’ websites through which legal services would be solicited for lawyers (but
not Plaintiffs) who bought client leads from Defendants. These so–called Lead–Buying Lawyers
would pay Defendants for leads to prospective clients looking for legal services. Plaintiffs allege
that IMS engages or affiliates with companies that use adware or malware browser plug–ins on
the computers of millions of consumers without their authorization or knowledge. When a
consumer browses the website of a lawyer who is not one of Defendants’ Lead–Buying Lawyers,
such as Plaintiffs, these plug–ins cause a form to “pop up” on the consumer’s computer screen.
The pop–up invites the consumer to provide contact information without indicating that the form
is not associated with the website which the consumer is viewing. If the consumer fills in the
pop–up form, IMS immediately routes the contact information to Defendant Reed Elsevier,
which them promptly calls the consumer and connects the consumer to a representative of the
LexisNexis LawyerLocator service, which informs the consumer that he or she will be referred
to one of Defendants’ Lead–Buying Lawyers. Plaintiff allege that IMS is paid by Lead–Buying
Lawyers for each prospect, and IMS in turn pays Reed Elsevier on a per–lead basis.
Plaintiffs allege that Defendants’ use of pop–up ads to solicit consumers who are
browsing the websites of Plaintiffs and similarly–situated lawyers serves unlawfully to confuse
the consumers regarding the origin of the legal services being offered, to pass off the services of
Defendants’ Lead–Buying Lawyers as those of Plaintiffs, and to divert those consumers who
likely sought the services of Plaintiffs to the services of Lead–Buying Lawyers.
Defendants aver in both the O’Sullivan Declaration and in the DallAcqua Declaration
that RME is merely a holding company that has no employees and no business operations, and
that RME has no connection to Oklahoma in any way. Defendants aver in the O’Sullivan

3

Declaration and in a Supplemental Declaration by O’Sullivan attached to Defendants’ Reply
Brief that IMS uses the internet to generate client leads for law firms and advocacy groups, but
that IMS does not generate leads by placing or causing others to place pop–up ads on individual
computers.

IMS avers that it does not download adware or malware to computer users’

browsers, and it has not authorized or directed any third person or entity to do so. IMS denies
that the pop–ups copied in Plaintiffs’ Complaint were authorized or directed by IMS. According
to O’Sullivan, over 90% of the leads obtained by IMS are from websites maintained by IMS;
less than 10% are leads purchased from other lead generators, and IMS is not involved in the
generation of those other leads.
With respect to its contacts with Oklahoma, IMS avers that none of its computer servers
is located in Oklahoma. IMS’s websites are accessible through the internet anywhere in the
world. IMS does not have any Oklahoma–specific advertisements or websites. IMS has two law
firm customers based in Oklahoma. One of the firms purchases approximately 200 social
security disability and automobile accident leads per month; the other firm purchases
approximately 60 leads a month related to automobile accidents and other areas of the law.
Together, the two Oklahoma law firms generate approximately 0.8% of IMS’s total revenue.
IMS does not sell any product or service to individuals in Oklahoma, through its websites or
otherwise. It does not have any offices or employees in Oklahoma, does not have any Oklahoma
bank accounts, and does not own any real or personal property in Oklahoma. Representatives of
IMS do not regularly travel to Oklahoma, and their limited travel to this state has been to one of
the law firms that purchases leads IMS has generated through its websites.
In their Reply, Plaintiffs challenge the credibility of O’Sullivan, primarily on the ground
that in his relatively short tenure as an officer of IMS he could not have personal knowledge of

4

the facts contained in his Declaration.5 In addition, Plaintiffs point out what they perceive to be
inconsistencies in the jurisdictional facts presented by Defendants. Whatever the shortcomings
Plaintiffs perceive in the O’Sullivan Declaration and Supplemental Declaration, Plaintiffs
present no evidence of their own to controvert O’Sullivan’s statements under oath.6 Rather,
Plaintiffs argue that their complaint contains sufficient allegations of fact to demonstrate that
Defendants have continuous and systematic contacts with Oklahoma enough to confer general
jurisdiction and, in any event, have directed their infringing activities to Oklahoma in a way that
confers specific jurisdiction.
ANALYSIS
The purpose of allowing a jurisdictional challenge such as the one raised here is to
protect a defendant who has no meaningful contact with a state from being forced to litigate in
an unfamiliar and potentially unfair forum. OMI Holdings, Inc. v. Royal Ins. Co. of Canada, 149
F.3d 1086, 1096 (10th Cir. 1998); Outdoor Channel, Inc. v. Performance One Media, LLC, 826
The cases cited by Plaintiffs, Hollander v. American Cyanamid Co., 999 F. Supp. 252 (D. Conn.
1998), aff’d, 172 F.3d 192 (2nd Cir. 1999), abrogated on other grounds in Schnabel v. Abramson,
232 F.3d 83 (2nd Cir. 2000), and Ramada Franchise Systems, Inc. v. Tresprop, Ltd., 75 F. Supp.2d
1205 (D. Kan. 1999), are not persuasive that O’Sullivan’s two declarations should be stricken. The
plaintiff’s affidavit in Hollander was stricken because it was “riddled with inadmissible hearsay,
conclusory statements and arguments, and information clearly not made on the affiant’s personal
knowledge [and it] more resembles an adversarial memorandum than a bona fide affidavit.” 999 F.
Supp. at 256. In Ramada Franchise, an affidavit submitted by the defendants was stricken to the
extent it purported to state the beliefs and intentions of third parties, because it was not self–evident
from the affidavit that those beliefs and intentions were within the personal knowledge of the affiant.
Here, O’Sullivan is Executive Vice President (and soon to be President) of IMS. Officers of a
business organization are generally treated as having personal knowledge of the organization’s acts,
regardless whether they personally performed or participated in them. See, e.g., Philbrick v. ENom,
Inc., 593 F. Supp.2d 352, 354 (D. N.H. 2009) (citing cases).
6
Plaintiffs offer the Declaration of Scott A. Kamber, one of Plaintiffs’ counsel, to which are attached
as exhibits five screen captures from RME, IMS, or other websites. To the extent those exhibits
suggest O’Sullivan’s knowledge about RME is limited, any deficiency appears to be cured by the
DallAcqua Declaration. In any event, the court concludes that none of the five exhibits places any
of the statements in the O’Sullivan Declaration or the O’Sullivan Supplemental Declaration into
material dispute for purposes of the court’s jurisdictional analysis.
5

5

F. Supp.2d 1271, 1278 (N.D. Okla. 2011).

The plaintiff bears the burden of establishing

personal jurisdiction, but where, as here, the issue is raised early on in litigation, based on
pleadings and affidavits, that burden can be met by a prima facie showing. Shrader v. Biddinger,
633 F.3d 1235, 1239 (10th Cir. 2011); Dudnikov v. Chalk & Vermillion Fine Arts, Inc., 514 F.3d
1063, 1069–70 (10th Cir. 2008).
To establish personal jurisdiction over Defendants, Plaintiff must show that jurisdiction
is proper under the laws of the forum state and that the exercise of jurisdiction would not offend
due process. Fireman’s Fund Ins. Co. v. Thyssen Min. Const., 703 F.3d 488, 492 (10th Cir.
2012) (citing Intercon, Inc. v. Bell Atlantic Internet Solutions, Inc., 205 F.3d 1244, 1247 (10th
Cir. 2000)); Monge v. RG Petro–Machinery (Group) Co., Ltd., 701 F.3d 598, 613 (10th Cir.
2012) (same); Outdoor Channel at 1278 (same). Where, as in Oklahoma, the state long–arm
statute supports personal jurisdiction to the full extent constitutionally permitted, due process
principles govern the inquiry. To exercise personal jurisdiction in harmony with due process,
Defendants must have “minimum contacts” with the forum state, such that having to defend a
lawsuit there would not “offend traditional notions of fair play and substantial justice.” Int’l
Shoe Co. v. Washington, 326 U.S. 310, 316 (1945). Such contacts may give rise to personal
jurisdiction over a non–resident defendant either generally, for any lawsuit, or specifically,
solely for lawsuits arising out of particular forum–related activities. Shrader at 1239.
General jurisdiction is based on an out–of–state defendant’s continuous and systematic
contacts with the forum state, and does not require that the claim be related to those contacts.
Specific jurisdiction, on the other hand, is premised on something of a quid pro quo. In
exchange for benefitting from some purposive conduct directed at the forum state, a party is
deemed to consent to the exercise of jurisdiction for claims related to those contacts. Id.;

6

Dudnikov at 1078.
In contrast to the single, overarching requirement of continuous and systematic contacts
for general jurisdiction, the “minimum contacts” test for specific jurisdiction encompasses two
distinct requirements: “first, that the out–of–state defendant must have ‘purposefully directed’
its activities at residents of the forum state, and second, that the plaintiff’s injuries must ‘arise
out of’ defendant’s forum–related activities.” Shrader at 1239; Dudnikov at 1071 (quoting
Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985)). Accord: Monge at 613–614; OMI
Holdings at 1091.
The Supreme Court recently assayed the scope of general and specific jurisdiction, and
the differences between them. Daimler, AG v. Bauman, 571 U.S. ___, 134 S.Ct. 746 (2014);
Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. ___, 131 S.Ct. 2846 (2011). In
Daimler, the Court observed that “[s]ince International Shoe, ‘specific jurisdiction has become
the centerpiece of modern jurisdiction theory, while general jurisdiction has played a reduced
role.’” 134 S.Ct. at 755 (quoting Goodyear, 131 S.Ct. at 2854). Both Daimler and Goodyear
make clear that a court does not have general jurisdiction over out–of–state (or foreign) business
organizations unless “their affiliations with the State are so ‘continuous and systematic’ as to
render them essentially at home in the forum State.” Daimler at 754; Goodyear at 2851. “‘For
an individual, the paradigm forum is the individual’s domicile; for a corporation, it is the
equivalent place, one in which the corporation is fairly regarded as at home.’ With respect to a
corporation, the place of incorporation and principal place of business are ‘paradig[m]. . . bases
for general jurisdiction.’ Those affiliations have the virtue of being unique––that is, each
ordinarily indicates only one place––as well as easily ascertainable.” Daimler at 760 (quoting
Goodyear at 2853–54) (other internal citations omitted).

7

Neither Daimler nor Goodyear held “that a corporation may be subject to general
jurisdiction only in a forum where it is incorporated or has its principal place of business; [they]
simply typed those places paradigm purpose forums. [However, a formulation that would allow]
the exercise of general jurisdiction in every State in which a corporation ‘engages in a
substantial, continuous, and systematic course of business’ . . . is unacceptably grasping.”
Daimler at 760–761. “[T]he inquiry under Goodyear is not whether a foreign corporation’s
in–forum contacts can be said to be in some sense ‘continuous and systematic,’ it is whether that
corporation’s ‘affiliations with the State are so ‘continuous and systematic’ as to render [it]
essentially at home in the forum State.” Daimler at 761 (quoting Goodyear at 2851).7 Tenth
Circuit authority is generally in accord. See Fireman’s Fund Ins. at 493 (quoting Goodyear at
2851). Cf. Shrader at 1243 (“contacts must be of a sort that ‘approximate physical presence’ in
the state––and ‘engaging in commerce with residents of the forum state is not in and of itself the
kind of activity that approximates physical presence within the state’s borders’”) (quoting
Bancroft & Masters, Inc. v. Augusta Nat’l, Inc., 223 F.3d 1082, 1086 (9th Cir. 2000)).
A.

General jurisdiction.

Applying Daimler and Goodyear to the facts of this case, it is clear that this court does
not have general jurisdiction over either of Defendants. RME is a Delaware corporation with a
principal place of business in Florida. It is “at home” in either of those two states, but not
Oklahoma.

Plaintiffs have not alleged any facts that would suggest that RME has such

continuous and systematic contacts with Oklahoma as to render it “at home” in this forum.
Indeed, DellAqua’s uncontested declaration that RME has no employees and no business
operations anywhere would negate any suggestion that RME would be subject to general
The Court noted that the use of the phrase “continuous and systematic” in International Shoe was
in reference to specific, not general, jurisdiction, and the phrase was used to describe in–forum
activities that gave rise to the claims. Daimler at 761.
7

8

jurisdiction here.
The same may be said for IMS. As a limited liability company organized under the laws
of Nevada and having its principal place of business in Texas, it would be “at home” in those
two states. IMS is, for jurisdiction purposes, also considered to be a citizen of the states where
its members are incorporated and have their principal places of business.8 According to the
uncontested DallAcqua Declaration, RME is IMS’s sole member. IMS would therefore be
considered “at home” in Delaware and Florida as well as Nevada and Texas, but not Oklahoma.
No activity of IMS alleged in the complaint or described in the declarations of IMS’s officers is
sufficient to approximate a physical presence or otherwise be “at home” in this state. IMS does
not maintain any office or employ any persons in Oklahoma. It owns no property and has no
banks accounts in this state. That IMS operates websites accessible in Oklahoma does not
confer general jurisdiction. Shrader at 1241; Soma Med. Int’l v. Standard Chartered Bank, 196
F.3d 1292, 1297 (10th Cir. 1999).
Plaintiffs’ argument that because IMS generates and sells hundreds of leads to Oklahoma
lawyers each month its commercial activities in this state are “continuous and systematic” rather
than “random, fortuitous, or attenuated” is unavailing.

The fact that IMS has continuing

The Tenth Circuit has not specifically ruled with respect to the method of determining the
citizenship of a limited liability company for comparable purposes of diversity jurisdiction. But cf.
Shell Rocky Mountain Production, LLC v. Ultra Resources, Inc., 415 F.3d 1158, 1162 (10th Cir.
2005) (“It is undisputed that Shell is a Delaware limited liability corporation (LLC) and its principal
place of business is Houston, Texas. Thus, Shell is a citizen of both Delaware and Texas.”).
However, every other circuit court that has addressed the question has determined that the
citizenship of a limited liability company is the citizenship of its members. See D.B. Zwirn Special
Opportunities Fund, L.P. v. Mehrotra, 661 F.3d 124, 125 (1st Cir. 2011); Johnson v. Columbia
Props. Anchorage, LP, 437 F.3d 894, 899 (9th Cir. 2006); General Tech. Applications, Inc. v. Exro
Ltda, 388 F.3d 114,121 (4th Cir. 2004); GMAC Commercial Credit LLC v. Dillard Dep’t Stores,
Inc., 357 F.3d 827, 828 (8th Cir. 2004); Rolling Greens MHP v. Comcast Sch. Holdings, 374 F.3d
1020, 1022 (11th Cir. 2004); Belleville Catering Co. v. Champaign Market Place, LLC, 350 F.3d
691, 692 (7th Cir. 2003); and Handelsman v. Bedford Village Associates Ltd. Partnership, 213 F.3d
48, 51–52 (2nd Cir. 2000); see also, 15 Moore’s Federal Practice §102.57[8] (3d ed. 2013).
8

9

business relationships with two Oklahoma law firms is not itself sufficient to confer general
jurisdiction over IMS in an Oklahoma court. Outdoor Channel at 1296 (six ongoing contracts
with Oklahoma entities not sufficient to confer general jurisdiction over Colorado–based entity)
(citing Helicopteros Nacionales de Colombia v. Hall, 466 U.S. 408 (1984)). Cf. Monge at
616–17, 620 (multiple sales of oil rigs, exchange of emails and a visit to Oklahoma by a
representative, a website and phone numbers accessible in Oklahoma, and revenue from another
Oklahoma customer insufficient to confer general jurisdiction over Chinese manufacturer);
Shrader at 1243–44 (purchases by plaintiff and another Oklahoma resident of books and other
materials from defendant, and defendant’s advertising in an Oklahoma magazine insufficient to
confer general jurisdiction) (citing cases); Benton v. Cameco Corp., 375 F.3d 1070, 1080–81
(10th Cir. 2004) (contract negotiations and two dozen “spot market” transactions with Colorado
resident over several years insufficient to confer general jurisdiction in Colorado over Canadian
company).
And Daimler rejects the concept that a business organization is “at home” in a given state
merely because it does significant business there. In Daimler, jurisdiction in a California federal
court over Daimler, a German public stock company, was predicated on the California contacts
of Mercedes–Benz USA, LLC (“MBUSA”), a Daimler subsidiary incorporated in Delaware with
its principal place of business in New Jersey that distributes Mercedes–Benz vehicles to
independent dealers throughout the United States, including California. The Court held that
MBUSA (and therefore Daimler) was not “at home” in California despite MBUSA’s “sizable”
sales there, concluding that if “Daimler’s California activities sufficed to allow adjudication of
this Argentina–rooted case in California, the same global reach would presumably be available
in every State in which MBUSA’s sales are sizable.” Daimler at 761. The Court described the

10

exercise of general jurisdiction on that basis as “exorbitant” and inconsistent with principles of
due process. Id. Plaintiffs’ complaint alleges and their arguments opposing Defendants’ motion
to dismiss concede that IMS’s alleged lead–generating activities are carried on throughout the
United States. In the present case, even if IMS’s lead generation and sales to Oklahoma lawyers
could be described as “sizable,” that is still insufficient to confer general jurisdiction over IMS in
this state.
B.

Specific jurisdiction.

If this court is to exercise its jurisdiction over either RME or IMS, it may do so only if its
jurisdiction is “specific.” “Specific jurisdiction . . . depends on an affiliation between the forum
and the underlying controversy, principally activity or an occurrence that takes place in the
forum State and is therefore subject to the State’s regulation. . . . In contrast to general,
all–purpose jurisdiction, specific jurisdiction is confined to adjudication of issues deriving from,
or connected with, the very controversy that establishes jurisdiction.”

Goodyear at 2851

(internal quotations and citations omitted). As stated above, to exercise jurisdiction in harmony
with due process principles, Defendants musts have “minimum contacts” with Oklahoma, such
that defending a lawsuit here would not offend traditional notions of fair play and substantial
justice. Int’l Shoe at 316; Shrader at 1239; Dudnikov at 1070; OMI Holdings at 1091.
The “minimum contacts” required by due process principles “for specific jurisdiction
entails two distinct requirements: ‘first, the out–of–state defendant must have “purposefully
directed” its activities at residents of the forum state, and second, that the plaintiff’s injuries
must “arise out of” defendant’s forum–related activities.’” Shrader at 1239 (quoting Dudnikov
at 1071). Accord: OMI Holdings at 1091; Outdoor Channel at 1280. As this court explained in
Outdoor Channel at 1280:

11

The purpose of the “purposeful direction” component is “to ensure
that an out–of–state defendant is not bound to appear to account
for merely ‘random, fortuitous, or attenuated contacts’ with the
forum state.” Dudnikov, 514 F.3d at 1072 (quoting Burger King,
471 U.S. at 472, 105 S.Ct. 2174). The “arise out of” factor
requires that there be a causal connection between the defendant’s
activities in the forum and the lawsuit. See id. at 1078.
However, “even if the ‘purposeful direction’ and ‘arising out of’ conditions for specific
jurisdiction are met, that is not the end of the matter. ‘[The court] must still inquire whether the
exercise of personal jurisdiction would offend traditional notions of fair play and substantial
justice.’” Shrader at 1240 (quoting Dudnikov at 1080); OMI Holdings at 1091.
Plaintiffs’ claims in this case arise from the alleged internet–based activity by
Defendants. The Tenth Circuit first addressed personal jurisdiction in the internet context in
Shrader. The court said it was “untenable” to base personal jurisdiction on the accessibility of a
website in a given state, because “the internet operates ‘in’ every state regardless of where the
user is physically located, potentially rendering the territorial limits of personal jurisdiction
meaningless.” Shrader at 1240. To avoid that untenable result, an internet user is subject to
personal jurisdiction only if the user or website “intentionally direct[s] his/her/its activity or
operation at the forum state rather than just having the activity or operation accessible there.” Id.
(citing ALS Scan, Inc. v. Digital Serv. Consultants, Inc., 293 F.3d 707, 712 (4th Cir. 2002))
(emphasis by court). Moreover, Shrader held that it is not enough for personal jurisdiction if the
internet conduct on which the plaintiff’s claim is based is merely targeted to a known resident of
the forum; “the forum state itself must be the focal point of the tort.” Id. at 1244 (quoting
Dudnikov at 1074 n.9) (emphasis by court).
Applying these principles to the facts of this case, it is clear that this court does not have
specific jurisdiction over either of Defendants. The personal jurisdiction issue in this case turns
on the lack of “purposeful direction” of Defendants’ alleged conduct. “In considering whether
12

the defendants purposefully directed their activities toward [the forum state], ‘we must examine
[both] the quantity and quality of [their forum] contacts.’ OMI Holdings, 149 F.3d at 1092. One
way to conduct this analysis in tort cases is to consider the ‘effects test’ of Calder v. Jones, 465
U.S. 783, 104 S.Ct. 1482, 79 L.Ed.2d 804 (1984), where purposeful direction is established if
three showings are made: the defendant (a) commits ‘an intentional action’; (b) that is ‘expressly
aimed at the forum state’; © with ‘knowledge that the brunt of the injury would be felt in the
forum state.’ Dudnikov, 514 F.3d at 1072; see Shrader, 633 F.3d at 1240–41; accord Carrier
Corp. v. Outokumpu Oyj, 673 F.3d 430, 451 (6th Cir. 2012).” Grynberg v. Ivanhoe Energy, Inc.,
490 Fed.Appx. 86, 96 (10th Cir. 2012). With respect to content on the internet, “courts look to
indications that a defendant deliberately directed its message at an audience in the forum state
and intended harm to the plaintiff occurring primarily or particularly in the forum state.”
Shrader at 1241.
With respect to RME, the court does not have specific jurisdiction. RME is a holding
company. DellAqua’s uncontested declaration that RME has no employees and no business
operations anywhere would negate (just as it did with respect to general jurisdiction) any
suggestion that RME would be subject to specific jurisdiction here. The complaint does not
identify any particular intentional act of RME, and certainly none expressly aimed at Oklahoma
as the forum state.9
Although the complaint identifies “LeadingResponse” (RME) as “purportedly a limited liability
company” (Compl. ¶11), the substantive allegations of the complaint do not differentiate between
alleged conduct of RME and alleged conduct of IMS (Compl. passim). Yet a plaintiff must establish
specific jurisdiction with respect to each defendant. Calder v. Jones, 465 U.S. 783, 790 (1984)
(“Each defendant’s contacts with the forum State must be assessed individually.”); Rush v. Savchuk,
444 U.S. 320, 332 (1980) (“The requirements of International Shoe, however, must be met as to each
defendant over whom a state court exercises jurisdiction.”). See, e.g., Fireman’s Fund at 493
(jurisdiction as to one defendant did not extend to other defendant); OMI Holdings at 1092
(jurisdiction over foreign defendant not permitted if based on unilateral acts of someone other than
defendant). RME’s status as IMS’s sole member does not confer jurisdiction over RME even if the
court were to have jurisdiction over IMS. See, e.g., Garshman v. Universal Resources Holding, Inc.,

9

13

Neither does this court have specific jurisdiction over IMS. The O’Sullivan Declaration
and Supplemental Declaration and the DallAcqua Declaration all aver that IMS (and RME for
that matter) has no involvement in the pop–up ads about which Plaintiffs complain, either
generating those pop–ups itself or directing others to do so. However, crediting the allegations
of the complaint that IMS is somehow involved in creating those pop–ups, the complaint fails to
demonstrate that IMS’s allegedly intentional conduct is “expressly aimed at the forum state”
with “knowledge that the brunt of the injury would be felt in the forum state,” a demonstration
that is required if specific jurisdiction is to be acquired consistent with due process.
Plaintiffs’ complaint alleges that IMS “serves over 200 Lead–buying Lawyers across all
50 states.”

Compl. ¶41.

IMS allegedly creates leads by “engag[ing] or affiliat[ing] with

companies that display online advertisements by using adware or malware browser plug–ins
surreptitiously downloaded to the computers of millions of consumers and activated without the
consumers’ authorization.” Compl. ¶43. These browser plug–ins allegedly cause a form to
pop–up on the consumer’s computer screen when that consumer is browsing the web for a
lawyer. Compl. ¶¶3, 43. The pop–up form invites the consumer to “Get legal advice” by filling
in contact information which IMS allegedly routes to Defendant Reed Elsevier, which then
promptly calls the consumer and connects the consumer to a representative of the LexisNexis
LawyerLocator service, which informs the consumer that he or she will be referred to one of
Defendants’ Lead–Buying Lawyers. Compl. ¶¶3–4, 43–47. Plaintiffs allege that these pop–ups
641 F. Supp. 1359, 1364–65 (D. N.J. 1986), aff’d on other grounds, 824 F.2d 223 (3rd Cir. 1987)
(New Jersey court did not have jurisdiction over Delaware corporation whose wholly–owned
subsidiary did business in New Jersey, despite public statements that parent company monitored
subsidiary’s development; “a parent may monitor or review a subsidiary’s policies and business
decisions ‘without destroying its corporate separateness for jurisdiction purposes.’”) (citation
omitted). In this case, there is no allegation or evidence that RME, an employee–less holding
company, exercises such control over IMS that it is subject to jurisdiction wherever IMS might be.
The exhibits Plaintiffs offer as attachments to the Kamber Declaration do not alter this conclusion.
14

have appeared on top of their websites, Compl. ¶¶2, 33, 65, but (as part of their class allegations)
Plaintiffs allege that the websites of “hundreds, if not thousands, of individuals and entities in the
Unites States” offering legal services have been impacted. Compl. ¶78.
These allegations clearly describe alleged conduct intentionally targeted not to Oklahoma
as a forum, or particularly to Plaintiffs in Oklahoma and Tennessee, but to millions of consumers
throughout the United States. In due process terms applicable to a specific jurisdiction analysis,
the allegedly “intentional conduct” of IMS is not “expressly aimed at the forum state” with
“knowledge that the brunt of the injury would be felt in the forum state.” Dudnikov at 1072. See
Shrader at 1241 (“deliberately directed its message at an audience in the forum state and
intended harm to the plaintiff occurring primarily or particularly in the forum state”). Indeed,
the allegations point to just the opposite. They describe conduct that is not targeted to Oklahoma
or any other particular state, but conduct that is directed at consumers across the country, with
the expectation that if the pop–ups generate leads that divert consumers from the websites over
which the ads appear, the lawyers impacted by that alleged diversion would not be just the
plaintiffs, or other lawyers in Oklahoma, but lawyers who practice in virtually every jurisdiction
in the United States.
Plaintiffs argue that this case is distinguishable from Shrader, but conceptually it is not.
In Shrader, neither the operators of a web–based discussion forum (the Beann defendants), nor
those posting an email message on the forum that was allegedly defamatory to the plaintiff (the
Stewart defendants), nor the person who forwarded the email to another forum member
(Biddinger) expressly directed their activities to Oklahoma. “On the contrary, Mr. Shrader’s
pleadings stressed the forum’s non–local nature, repeatedly referring to the fact that it drew an
audience from all over the world.” Shrader at 1242. Plaintiffs’ pleading in this case stresses that

15

Defendants’ alleged conduct of infecting consumers’ computers with adware that causes a
pop–up to appear when the consumer is browsing for legal services is directed to consumers
throughout the United States. Defendant’s conduct, even if intentional, is not allegedly targeted
to Oklahoma generally or Plaintiffs particularly; it is allegedly “expressly directed” to millions
of consumers throughout the country. Oklahoma is no more a state to which Defendants’
conduct is allegedly directed than any other state. Cf. Outdoor Channel at 1281 (“[T]his court
concludes that POM’s transmission of ICTV programming to DirectTV and DISH Network, who
then broadcast that signal to the entire United States, pursuant to contract, does not demonstrate
that POM ‘purposefully directed its activities’ at residents of Oklahoma.). Shrader makes clear
that a “plaintiff’s residence in the forum state, and hence suffering harm there, does not alone
establish personal jurisdiction over a defendant who has not purposefully directed his activities
at the state.” Shrader at 1245.10
The jurisdictional deficiency of Plaintiffs’ complaint is not saved by their allegations of
conspiracy among the defendants. Plaintiffs allege, in rather conclusory terms, that Defendants
conspired with Defendants Reed Elsevier and Internet Brands “to perpetrate against Plaintiffs
and the members of the general consuming public seeking legal counsel, for Defendants’ own
financial gain,” the conduct alleged in the complaint. Compl. ¶122.11 In general, Plaintiffs
allege, “Defendants’ actions were coordinated and recurring, with each Defendant performing an
It naturally follows that a plaintiff’s claim cannot “‘arise out of” defendant’s forum–related
activities,” Shrader at 1239––the second element of specific jurisdiction––if the activities are not
purposefully directed at the forum state.
11
It should be noted that RME and IMS are not alleged to have conspired with each other; Plaintiffs
describe them as “operationally indistinguishable,” Compl. ¶12, and Plaintiffs do not allege any
specific acts of one entity independent of the other. Moreover, RME is a non–operating holding
company that is the sole member of the limited liability company IMS. DallAcqua Declaration ¶¶3,
5. As such, it is unlikely that RME is legally capable of conspiring with IMS, but in any event
Plaintiffs do not allege that it did. Likewise, Plaintiffs treat Defendants Reed Elsevier and Internet
Brands singularly, and allege that they operated as a joint venture during the salient period. Compl.
¶¶15, 75. Accordingly, any alleged conspiracy must be between IMS and Reed Elsevier.
10

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essential role in the overall scheme to display Pop–Ups to prospective clients visiting Plaintiffs''
websites, collect prospective clients’ personal information, promptly communicate with
prospective clients and with each other to further the diversion of prospective clients and,
ultimately, divert prospective clients to Lead–buying Lawyers.”

Compl. ¶122.

However,

“[t]hese are just the sorts of allegations Dudnikov directs us not to consider, as it pointedly limits
the facts that must be accepted for purposes of the jurisdictional analysis to those ‘well–pled
(that is, plausible, non–conclusory, non–speculative) facts alleged in plaintiff[‘s] complaint,’ 514
F.3d at 1070 (citation omitted). As we have held elsewhere, ‘[i]n order for personal jurisdiction
based on a conspiracy theory to exist, the plaintiff must offer more than “bare allegations” that a
conspiracy existed, and must allege facts that would support a prima facie showing of a
conspiracy.’ Melea, Ltd. v. Jawer SA, 511 F.3d 1060, 1069 (10th Cir. 2007) (quoting Lolavar v.
de Santibanes, 430 F.3d 221, 229 (4th Cir. 2005)).” Shrader at 1242.
Moreover, even in an alleged conspiracy, minimum contacts with the forum must be met
as to each defendant. Melea at 1070 (“Due process requires that [a non–resident co–conspirator]
itself have minimum contacts” with the forum state.).

For the reasons already discussed,

Plaintiffs have failed to allege that these Defendants had sufficient minimum contacts with
Oklahoma to support specific jurisdiction. Adding an allegation that Defendants conspired with
others does not solve Plaintiffs’ pleading dilemma.
As outlined at the beginning of the court’s analysis, Plaintiffs must show both that
jurisdiction is proper under the laws of the forum state and that the exercise of jurisdiction would
not offend due process, that is, that forcing Defendants to defend a lawsuit there would not
“offend traditional notions of fair play and substantial justice.” Int’l Shoe Co. v. Washington,
326 U.S. 310, 316 (1945). Thus, even when sufficient minimum contacts exist, a court must

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determine whether the assertion of personal jurisdiction comports with due process. Dudnikov at
1080. This inquiry considers five factors:
(1) the burden on the defendant, (2) the forum state’s interests in
resolving the dispute, (3) the plaintiff’s interest in receiving
convenient and effectual relief, (4) the interstate judicial system’s
interest in obtaining the most efficient resolution of controversies,
and (5) the shared interest of the several states or foreign nations in
furthering fundamental social policies.
Id. (brackets omitted). See also AST Sports Science, Inc. v. CLF Distribution Ltd., 514 F.3d
1054, 1061 (10th Cir. 2008); TH Agriculture & Nutrition, LLC, v. ACE European Group Ltd.,
488 F.3d 1282, 1292 (10th Cir. 2007); Trujillo v. Williams, 465 F.3d 1210, 1221 (10th Cir.
2006); OMI Holdings at 1095; Outdoor Channel at 1290.
However, because this court has concluded that Defendants do not have sufficient
“minimum contacts” with this forum to support the exercise of personal jurisdiction, it is
unnecessary to analyze these five factors to determine whether the exercise of jurisdiction would
“offend traditional notions of fair play and substantial justice.” See Soma Medical Intern. v.
Standard Chartered Bank, 196 F.3d 1292, 1299 n.1 (10th Cir. 1999) (“Because we conclude that
Soma has failed to establish that SCB has minimum contacts with the state of Utah, we need not
proceed to the next step of the due process analysis, i.e., whether the exercise of personal
jurisdiction over SCB would offend ‘traditional notions of fair play and substantial justice.’
[citation omitted].”). Cf. Shrader (contacts with forum insufficient for jurisdiction; court did not
discuss five factors) with OMI Holdings (“limited” contacts with forum required consideration of
five factors) and Outdoor Channel (court discussed five factors because “one weak, specific
contact exists between POM and Oklahoma”).12
The court observes that most of the factors would appear to be relatively neutral; but the first
factor––the not immodest burden on Defendants (who appear most likely “at home” in Texas) in
defending a suit in Oklahoma––would seem to weigh, at least slightly, in Defendants’ favor. See,
e.g., TH Agriculture, supra, 488 F.3d at 1292 (“[W]hile modern advances may minimize the burden
12

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C.

Jurisdictional discovery.

One final matter must be addressed. In responding to Defendants’ motion, Plaintiffs seek
leave to conduct jurisdictional discovery if the court relies on the O’Sullivan Declaration.
Describing it as a “flimsy proffer,” Plaintiffs argue that they would be prejudiced if the court
rules on the motion in reliance on the Declaration without affording Plaintiffs the opportunity to
conduct discovery concerning “Defendants’ Oklahoma contacts in relation to its conduct
regarding Pop–Ups appearing in Oklahoma.” Doc. No. 51 at 25. The court has considered
O’Sullivan’s Declaration (as well as his Supplemental Declaration, along with the DallAcqua
Declaration) only with respect to the forms of organization and places of business of RME and
IMS, their relationship (as parent holding company and subsidiary limited liability company),
and their lack of employees or physical assets in the state of Oklahoma. Plaintiffs do not appear
to take issue with those facts stated in O’Sullivan’s submissions. As the court’s analysis above
reflects, it has disregarded O’Sullivan’s Declaration and Supplemental Declaration with respect
to IMS’s alleged role in the generation of the pop–ups about which Plaintiffs complain. The
court has, instead, credited Plaintiffs’ allegations in that regard. The court has nevertheless
concluded that the facts, as alleged by Plaintiffs, do not support the exercise of personal
jurisdiction, for the reasons the court has explained. It does not appear to the court that the
jurisdictional discovery proposed by Plaintiffs would alter their allegations in a way that might
significantly change the court’s analysis. Accordingly, the court denies Plaintiff’s request.

on the Insurers, they are not significant enough to tip the scales in favor of exercising jurisdiction.”);
Western World Insurance Co. v. Nonprofits’ ins. Alliance of California, No. CIV–13–216–KEW,
2014 WL 1282254, *4 (E.D. Okla. Mar. 27, 2014) (“NIAC’s offices, records, employees, and
witnesses are all based in the State of California. While modern technology and transportation might
minimize the impact of this fact, it does not tip the scales in favor of exercising jurisdiction.”).
However, as stated, it is not necessary under the circumstances to explore these factors.
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D.

Conclusion.

Based on the foregoing, Defendants’ Motion to Dismiss Plaintiffs’ Complaint for Lack of
Personal Jurisdiction [Doc. No. 31], is GRANTED. The claims of Plaintiffs Anthony L. Allen,
Allen & Wisner, LLC, James E. Blount, IV, and Blount Law Firm, PLLC against Defendants
IM Solutions, LLC and RME Group Holding Company (“LeadingResponse”) are dismissed for
lack of personal jurisdiction.
IT IS SO ORDERED this 6th day of January, 2015.

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