Michael J. McCormick Farm, Inc. v. Swinderman
REPORT AND RECOMMENDATIONS re 8 Amended MOTION to Dismiss for Lack of Jurisdiction /Personal filed by Robin Swinderman. Within fourteen (14) days after service of the magistrate judges report, any party may serveand file written objections to the findings and recommendations of the magistrate judge. 28 U.S.C.A. § 636(b)(1)(c). Signed by Magistrate Judge Don D. Bush on 6/5/13. (cm, )
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF TEXAS
MICHAEL J MCCORMICK
CASE NO. 4:12-CV-00545-RAS-DDB
REPORT AND RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE
Now before the Court is Defendant’s Amended Motion to Dismiss for Lack of Personal
Jurisdiction (Dkt. 8). Having reviewed the motion, the response, the applicable authorities, and the
record in this case, the Court finds that the motion to dismiss should be DENIED.
In this suit, Plaintiff Michael J. McCormick Farms, Inc. has sued horse owner, Defendant
Robin Swinderman. According to Plaintiff’s Original Complaint, Defendant breached her contract
with Plaintiff by abruptly recalling a horse that Defendant had placed in Plaintiff’s possession in
Texas for training and presentation for sale. Plaintiff’s suit is based in diversity and seeks damages
for breach of contract, unjust enrichment, and tortious interference. See Dkt. 1.
In her motion to dismiss, Defendant Swinderman, a Florida resident, argues that this Court
does not have personal jurisdiction over her. Plaintiff has filed a response in opposition.
In determining whether it may exercise personal jurisdiction over a nonresident defendant,
a court must consider “both the forum state’s long-arm statute and federal due process.” Johnston
v. Multidata Sys. Int’l Corp., 523 F.3d 602, 609 (5th Cir. 2008) (citing Ruston Gas Turbines, Inc.
v. Donaldson Co., 9 F.3d 415, 418 (5th Cir. 1993)). If a state’s long-arm statute “extends to the
limits of federal due process,” as Texas’s does, the court must only perform a due process analysis.
Id. (citing Wilson v. Belin, 20 F.3d 644, 647 (5th Cir. 1994)). Due process allows a federal court to
exercise personal jurisdiction over a nonresident defendant only if: (1) the nonresident defendant has
established minimum contacts by “purposely avail[ing] himself of the benefits and protections of the
forum state” and (2) “the exercise of jurisdiction does not offend traditional notions of fair play and
substantial justice.” Id. (citing Wilson, 20 F.3d at 647).
Minimum contacts may be established through either specific or general jurisdiction. Lewis
v. Fresne, 252 F.3d 352, 358 (5th Cir. 2001). General jurisdiction exists if the defendant has had
substantial, continuous, and systematic contacts with the forum state, regardless of whether those
contacts are related to the cause of action. Johnston, 523 F.3d at 609 (citing Helicopters Nacionales
de Colombia, 466 U.S. 408, 414-19 (1984)).
Specific jurisdiction exists when a nonresident
defendant has purposefully directed his activities at the forum state and the plaintiff’s alleged injuries
derive from those activities. Walk Haydel & Assocs., Inc. v. Coastal Power Prod. Co., 517 F.3d 235,
243 (5th Cir. 2008) (“Specific jurisdiction applies when a nonresident defendant has purposefully
directed its activities at the forum state and the litigation results from alleged injuries that arise out
of or relate to those activities.”) (internal citations omitted); Religious Tech. Ctr. v. Liebreich, 339
F.3d 369, 375 (5th Cir. 2003) (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 (1985)).
Furthermore, the court has specific jurisdiction when a “defendant who has placed goods in the
stream of commerce benefits economically from the retail sale of the final product in the forum
State, and indirectly benefits from the State's laws that regulate and facilitate commercial activity.”
Asahi Metal Industry Co. Ltd. v. Superior Court of California, Solano County, 480 U.S. 102, 117
The plaintiff bears the burden of proving that the defendant has had minimum contacts with
the forum state; however, the plaintiff need only make a prima facie showing of such contact.
Johnston, 523 F.3d at 609 (citing Wilson, 20 F.3d at 648). The court must resolve any disputed facts
in favor of the plaintiff and a finding of jurisdiction. Id. (citing Bullion v. Gillespie, 895 F.2d 213,
217 (5th Cir. 1990)). “[U]ncontroverted allegations in the plaintiff’s complaint must be taken as
true, and conflicts between the facts contained in the parties’ affidavits must be resolved in the
plaintiff’s favor for purposes of determining whether a prima facie case for personal jurisdiction
exists.” Bullion, 895 F.2d at 217 (internal citations omitted). “In considering a motion to dismiss
for lack of personal jurisdiction a district court may consider affidavits, interrogatories, depositions,
oral testimony, or any combination of the recognized methods of discovery.” Revell v. Lidov, 317
F.3d 467, 469 (5th Cir. 2002) (internal citations omitted).
If the plaintiff successfully makes a prima facie showing of minimum contacts, the burden
shifts to the defendant to show “that traditional notions of fair play and substantial justice would be
violated by the exercise of jurisdiction.” Johnston, 523 F.3d at 615 (citing Wien Air Alaska, Inc. v.
Brandt, 195 F.3d 208, 215 (5th Cir. 1999) (citations omitted)); Luv N’Care, Ltd. v. Insta-Mix, Inc.,
438 F.3d 465, 473 (5th Cir. 2006) (citing Nuovo Pignone, SpA v. STORMAN ASIA M/V, 310 F.3d
374, 382 (5th Cir. 2002)). Under the fairness inquiry, the court examines: “(1) the burden on the
nonresident defendant, (2) the forum state’s interests, (3) the plaintiff’s interest in securing relief,
(4) the interest of the interstate judicial system in the efficient administration of justice, and (5) the
shared interest of the several states in furthering fundamental social policies.”
Luv N’Care, 438
F.3d at 473 (citing Felch v. Transportes Lar-Mex SA De CV, 92 F.3d 320, 324 (5th Cir. 1996)).
In her motion, Defendant argues that she is not subject to personal jurisdiction in this Court
because: (1) she does not have sufficient minimum contacts with the Texas to confer jurisdiction,
and (2) it would not be fair and reasonable to require her to litigate in Texas. Specifically, Defendant
claims that: she is a Florida resident; her only business contact with Texas has been this disputed
transaction, which she did not initiate; the agreement was reached in Florida; she has no place of
business in Texas; the relevant facts of this case occurred only in Florida and Michigan, not Texas;
it would be overly burdensome to call Defendant to litigate in Texas; litigation in Texas serves no
Texas interest; this litigation would be inefficient in light of similar relief available in Florida; and
this litigation does not serve the specific interests of Texas above those of the state of Florida. See
Dkt. 8 at 5.
In his complaint, Plaintiff has alleged the following contacts by Defendant in Texas:
“Swinderman caused INXS to be shipped from Florida to MJMF’s training facility
in Flower Mound, Texas.” Dkt. 1 at ¶7
“Swinderman contacted MJMF in Texas and demanded that the horse be returned to
Florida, complaining that Gentry was taking too long in making her decision.”
Dkt 1 at ¶14.
Plaintiff further alleges in support of its jurisdictional allegations that Defendant transferred
her horse from the state of Florida to Texas; that Defendant intended her horse to be marketed, sold,
and trained in Texas; and that Plaintiff has suffered damages related to his boarding, veterinary care,
farrier care, and training of Defendant’s horse in the state of Texas. See Dkt. 10, 4-5.
Having considered these allegations, the Court finds that there are insufficient allegations to
make a prima facie case of general jurisdiction over Defendant. Plaintiff’s allegations do not amount
to the “substantial, continuous, and systematic contacts” required to grant the Court general
jurisdiction. Johnston v. Multidata Sys. Intern. Corp., 523 F.3d 602, 609 (5th Cir. 2008) (citing
Helicopters Nacionales de Colombia, 466 U.S. 408, 414-19 (1984)).
Next, the Court looks to whether Plaintiff has established a prima facie case of specific
jurisdiction over Defendant.
While it is uncontested that Defendant generally does not conduct
business in Texas and did not initiate contact with Plaintiff, this controversy arises out of
Defendant’s sale of a horse to a Texas buyer. In Gulf Consolidated, the Fifth Circuit held that a pipe
manufacturer had sufficient minimum contacts to give the Texas district court personal jurisdiction
over a pipe manufacturer because it “delivered the product into the ‘stream of commerce’ with the
expectation that it should be purchased by or used by consumers in the forum state.” Gulf Consol.
Servs., Inc. v. Corinth Pipeworks, S.A., 898 F.2d 1071, 1073 (5th Cir. 1990). In that case, the pipe
manufacturer claimed to not have minimum contacts because it only conducted business inside
Greece: the pipe manufacturer was a Greek corporation with its offices and factory located in
Greece; it was not registered to do business in Texas; it had no agents or assets in the United States;
the transaction was negotiated by telegram; the actual sale took place in Greece; payments were
made through a Greek bank; and full performance was complete when the product was delivered to
a ship in Greece. Id. Even though the plaintiff in that case was an employee of the distributor and
did not encounter the pipe manufacturer’s product in the stream of commerce, the court held that the
pipe manufacturer, by selling the product to a known importer and seller of pipe in Texas, “should
reasonably anticipate being haled into court there.” Id. (citing World-Wide Volkswagen v. Woodson,
444 U.S. 286, 295 (1980)).
In this case, Plaintiff alleges that Defendant sent her horse to Texas to be presented for sale
and sold by a horse seller located in Texas. See Dkt. 8, ¶ 4. That “[t]he horse was not even located
in Texas at the time of the breach,” see Dkt. 8, ¶ 9, does not negate the fact that Defendant, according
to Plaintiff’s allegations here, intentionally delivered the horse “into the ‘stream of commerce’ with
the expectation that it should be purchased by or used by consumers in the forum state.” See Gulf
Consolidated, 898 F.2d at 1073. By delivering the horse to Texas, the Court finds a sufficient
showing that Defendant actively attempted to financially benefit from sale in the forum for
jurisdictional purposes. See Choice Healthcare, Inc. v. Kaiser Foundation Health Plan of Colo., 615
F.3d 364, 373 (5th Cir. 2010) (“Deriving revenue from such commercial activity is the quid pro quo
for requiring the defendant to suffer a suit in the foreign forum.”).
Although Defendant’s contacts with Texas in this case truly are minimal at best, the Court
finds that these allegations, which are not specifically controverted by Defendant, are sufficient to
establish a prima facie case of Defendant’s minimum contacts with Texas for purposes of specific
jurisdiction. No affidavits, discovery materials or documentary evidence having been submitted by
either party to show Defendant’s contacts (or lack thereof) with the forum, the Court must resolve
all conflicts and doubts in Plaintiff’s favor and take all allegations as true. See Bullion v. Gillespie,
895 F.2d 213, 217 (5th Cir. 1990)). As such, the Court finds a prima facie showing of minimum
Having found sufficient minimum contacts with Texas, the Court turns to whether exercising
jurisdiction in this case would offend notions of fair play and substantial justice. The pleadings here
do not show how the exercise of jurisdiction over Defendant does not comport with notions of fair
play and substantial justice. See Johnston, 523 F.3d at 615 (citing Wien Air Alaska, Inc. v. Brandt,
195 F.3d 208, 215 (5th Cir. 1999) (citations omitted)). Additionally, Defendant has failed to cite any
governing authority that would indicate that the existence of a related state suit in Florida precludes
this Court from exercising personal jurisdiction. Plaintiff has alleged that Defendant sent her horse
to be presented and sold in Texas markets and Defendant used Texas residents to facilitate her sale.
Without contravention of those allegations through affidavits or otherwise, Defendant has not made
a sufficient showing that proceeding in this forum would be unjust and the Court cannot find that
Defendant should not have reasonably foreseen being haled into court in Texas.
Based on the foregoing, the Court recommends that Defendant’s Amended Motion to
Dismiss for Lack of Personal Jurisdiction (Dkt. 8) be DENIED.
Within fourteen (14) days after service of the magistrate judge’s report, any party may serve
and file written objections to the findings and recommendations of the magistrate judge.
U.S.C.A. § 636(b)(1)(c).
Failure to file written objections to the proposed findings and
recommendations contained in this report within fourteen days after service shall bar an aggrieved
party from de novo review by the district court of the proposed findings and recommendations and
from appellate review of factual findings accepted or adopted by the district court except on grounds
of plain error or manifest injustice. Thomas v. Arn, 474 U.S. 140, 148 (1985); Rodriguez v. Bowen,
857 F.2d 275, 276-77 (5th Cir. 1988).
SIGNED this 5th day of June, 2013.
DON D. BUSH
UNITED STATES MAGISTRATE JUDGE
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