TFG-Michigan v. Boersen Farms Grain et al

Filing 92

MEMORANDUM DECISION AND ORDER granting 42 Defendant GreenMark Equipment's Motion to Dismiss for Lack of Personal Jurisdiction. Signed by Judge Ted Stewart on 7/12/2017. (eat)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF UTAH
TFG-MICHIGAN, L.P., a Utah limited
partnership,
Plaintiff,
v.
MEMORANDUM DECISION AND
ORDER GRANTING DEFENDANT
GREENMARK EQUIPMENT INC.’S
MOTION TO DISMISS FOR LACK OF
PERSONAL JURISDICTION

BOERSEN FARMS GRAIN, a Michigan
partnership, BOERSEN FARMS
PROPERTIES, LLC, a Michigan limited
company, BOERSEN FARMS, INC., a
Michigan corporation, BOERSEN
TRANSPORT, INC., a Michigan
corporation, BOERSEN FARMS AG, LLC,
a Michigan limited liability company,
BOERSEN LAND COMPANY, LLC, a
Michigan limited liability company,
DENNIS A. BOERSEN, a Michigan citizen,
ROSS M. BOERSEN, a Michigan citizen,
ARLAN J. BOERSEN, a Michigan citizen,
and SANDRA BOERSEN, a Michigan
citizen, GREENMARK EQUIPMENT,
INC., a Michigan corporation,

Case No. 2:17-CV-231 TS
District Judge Ted Stewart

Defendants.

This matter is before the Court on Defendant GreenMark Equipment, Inc.’s
(“GreenMark”) Motion to Dismiss for Lack of Personal Jurisdiction. For the reasons discussed
below, the Court will grant the Motion.
I. BACKGROUND
Plaintiff is an equipment leasing company. Plaintiff has leased certain equipment to the
Boersen Defendants. None of that equipment is located in Utah. Plaintiff alleges that the
Boersen Defendants have worked with Defendant GreenMark to sell some of that equipment to
third parties, despite the fact that they do not have ownership of or title to the equipment. None
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of those sales occurred in Utah. Plaintiff brings a claim of conversion against Defendant
GreenMark. Defendant GreenMark argues that the Court lacks personal jurisdiction over it.
II. STANDARD OF REVIEW
Federal Rule of Civil Procedure 12(b)(2) is the vehicle by which a party may move for
dismissal based on lack of personal jurisdiction. Plaintiff bears the burden of establishing the
jurisdiction over Defendant. 1 When a motion to dismiss for lack of personal jurisdiction is
brought before trial and supported by affidavits and other written materials, Plaintiff need only
make a prima facie showing of jurisdiction. 2 “The ‘well pled facts’ of the complaint must be
accepted as true if uncontroverted by the defendant’s affidavits, and factual disputes at this initial
stage must be resolved in the plaintiff’s favor when the parties present conflicting affidavits.” 3
III. DISCUSSION
“To obtain personal jurisdiction over a nonresident defendant in a diversity action, a
plaintiff must show that jurisdiction is legitimate under the laws of the forum state and that the
exercise of jurisdiction does not offend the due process clause of the Fourteenth Amendment.” 4
Utah’s long arm statute applies “to the fullest extent permitted by the due process clause of the
Fourteenth Amendment to the United States Constitution.” 5 Thus, it is “helpful to undertake the

1

Kuenzle v. HTM Sport-Und Freizeitgeräte AG, 102 F.3d 453, 456 (10th Cir. 1996).

2

Wenz v. Memery Crystal, 55 F.3d 1503, 1505 (10th Cir. 1995).

3

Fed. Deposit Ins. Corp. v. Oaklawn Apartments, 959 F.2d 170, 174 (10th Cir. 1992).

4

Soma Med. Int’l v. Standard Chartered Bank, 196 F.3d 1292, 1295 (10th Cir. 1999)
(quoting Far W. Capital, Inc. v. Towne, 46 F.3d 1071, 1074 (10th Cir. 1995)).
5

Utah Code Ann. § 78B-3-201(3).

2

due process analysis first, because any set of circumstances that satisfies due process will also
satisfy the long-arm statute.” 6
A due-process analysis of personal jurisdiction is a two-step inquiry. First, this Court
must consider whether the defendant has sufficient “minimum contacts” with the forum state
“that he should reasonably anticipate being haled into court there.” 7 Second, “if the defendant’s
actions create sufficient minimum contacts, we must then consider whether the exercise of
personal jurisdiction over the defendant offends traditional notions of fair play and substantial
justice.” 8
The “minimum contacts” standard may be met by a finding of either general jurisdiction
or specific jurisdiction. For general jurisdiction to exist, “the defendant must be conducting
substantial and continuous local activity in the forum state.” 9 In order for the Court to find
specific jurisdiction, there must be “some act by which the defendant purposefully avails itself of
the privilege of conducting activities within the forum State, thus invoking the benefits and
protections of its laws.” 10 When the “defendant has ‘purposely directed’ his activities at
residents of the forum,” courts in that state may exercise specific jurisdiction for injuries that
“arise out of or relate to those activities.” 11

6

Sys. Designs, Inc. v. New Customward Co., 248 F. Supp. 2d 1093, 1097 (D. Utah 2003).

7

World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980).

8

OMI Holdings, Inc. v. Royal Ins. Co. of Can., 149 F.3d 1086, 1091 (10th Cir. 1998)
(citation and internal quotation marks omitted).
9

Soma, 196 F.3d at 1295 (quoting Arguello v. Woodworking Mach. Co., 838 P.2d 1120,
1122 (Utah 1992)).
10

Hanson v. Denckla, 357 U.S. 235, 253 (1958) (citation omitted).

11

Burger King v. Rudzewicz, 471 U.S. 462, 472–73 (1985).

3

Plaintiff does not assert that the Court may exercise general jurisdiction over Defendant
GreenMark. Thus, the question becomes whether there are sufficient contacts to support specific
jurisdiction. “In the tort context, we often ask whether the nonresident defendant ‘purposefully
directed’ its activities at the forum state.” 12 “[P]urposeful direction exists when there is ‘an
intentional action . . . expressly aimed at the forum state . . . with [the] knowledge that the brunt
of the injury would be felt in the forum state.’” 13
Importantly, the minimum-contacts analysis looks to the defendant’s contacts with the
forum state itself, not defendant’s contacts with residents of that state. 14 “[T]he plaintiff cannot
be the only link between the defendant and the forum. Rather, it is the defendant’s conduct that
must form the necessary connection with the forum state that is the basis for its jurisdiction over
him.” 15 Thus, the “mere injury to a forum resident is not a sufficient connection to the forum.” 16
“The proper question is not where the plaintiff experienced a particular injury or effect but
whether the defendant’s conduct connects him to the forum in a meaningful way.” 17 “[T]he
mere fact that [a defendant’s] conduct affected plaintiffs with connections to the forum State
does not suffice to authorize jurisdiction.” 18

12

Dudnikov v. Chalk & Vermilion Fine Arts, Inc., 514 F.3d 1063, 1071 (10th Cir. 2008).

13

Anzures v. Flagship Rest. Grp., 819 F.3d 1277, 1280 (10th Cir. 2016) (quoting
Dudnikov, 514 F.3d at 1072).
14

Walden v. Fiore, 134 S. Ct. 1115, 1122 (2014).

15

Id.

16

Id. at 1125.

17

Id.

18

Id. at 1126.

4

Here, there is nothing to suggest that Defendant’s alleged conversion of Plaintiff’s
property was expressly aimed at the forum state. The only connection between Defendant
GreenMark and Utah is the fact that Plaintiff is a Utah entity. 19 Plaintiff purports to own or have
a security interest in the equipment Defendant GreenMark allegedly converted. However, as
stated, the fact that Plaintiff has ties to the forum state, and thus was injured in the forum state, is
not sufficient to establish personal jurisdiction. “[M]ere injury to a forum resident is not a
sufficient connection to the forum.” 20
Further, there is no evidence that Defendant GreenMark knew that the brunt of the injury
would be felt in the forum state. Plaintiff argues that its UCC filings should have put Defendant
on notice that Plaintiff owned or had a security interest in the equipment at issue. However,
Defendant has presented evidence that it did not learn of Plaintiff’s UCC filings until February
2017 and was not made aware of the specific equipment at issue in this litigation until it was
served with Plaintiff’s Amended Complaint on April 17, 2017. Defendant states that all of the
transactions whereby GreenMark purchased any of the equipment that Plaintiff claims it owns
occurred before that date. Thus, there is no evidence that Defendant GreenMark knew that the
brunt of the injury would be felt in Utah. Based upon this, Plaintiff has failed to show sufficient
minimum contacts to support specific personal jurisdiction over Defendant GreenMark. As a
result, the Court need not consider whether exercising jurisdiction over Defendant GreenMark
would offend traditional notions of fair play and substantial justice.

19

Docket No. 70, at 11 (“No question exists that these acts were purposely directed
towards a Utah entity and expressly aimed at property owned by a company in the State of
Utah.”).
20

Walden, 134 S. Ct. at 1125

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IV. CONCLUSION
It is therefore
ORDERED that Defendant GreenMark’s Motion to Dismiss for Lack of Personal
Jurisdiction (Docket No. 42) is GRANTED.
DATED this 12th day of July, 2017.
BY THE COURT:

Ted Stewart
United States District Judge

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