Mirza Minds Inc v. Kenvox USA LLC et al

Filing 38

ORDER ON MOTIONS TO DISMISS; denying 13 Marc Resnick's Motion to Dismiss; denying 18 Chere Resnick's Motion to Dismiss; granting 20 David and Jane Doe Herrera's Motion to Dismiss for Lack of Jurisdiction. Defendants David and Jane Doe Herrera are dismissed from this case. Signed by Judge Stanley A Bastian. (CV, Case Administrator)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF WASHINGTON

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9 MIRZA MINDS INC., an Illinois

No. 2:15-cv-00053-SAB

10 Corporation, D/B/A 1 FACE WATCH
11 COMPANY,
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Plaintiff,

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ORDER ON MOTIONS TO
DISMISS

v.

14 KENVOX US L.L.C., a Nevada
15 Corporation, MARC RESNICK and
16 JANE DOE RESNICK and the marital
17 community composed thereof, CHERE
18 RESNICK and JOHN DOE RESNICK and
19 the marital community composed thereof,
20 DAVID HERRERA and JANE DOE
21 HERRERA and the marital community
22 thereof, JOHN DOES 1-6 AND JANE
23 DOES 1-6,
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Defendants.

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Before the Court is pro se Defendant Marc Resnick’s “Request for

27 Dismissal,” ECF No. 13; Defendants David and Jane Doe Herrera’s Motion to
28 Dismiss for Lack of Jurisdiction, ECF No. 20; and pro se Defendant Chere
ORDER ON MOTIONS TO DISMISS ^ 1

1 Resnick’s “Request for Dismissal,” ECF No. 18. For the reasons stated below, the
2 motions to dismiss filed by Marc Resnick and Chere Resnick, ECF Nos. 13 and
3 18, are denied; and the motion to dismiss filed by David and Jane Doe Herrera,
4 ECF No. 20, is granted. The Court first considers the motions based on personal
5 jurisdiction, ECF Nos. 13 and 20.
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Standard for Personal Jurisdiction

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This federal court uses the long-arm statute of Washington State when

8 considering personal jurisdiction, which runs to the full extent of federal due
9 process. RCW 4.28.185(1); Chan v. Soc. Expeditions, Inc., 39 F.3d 1398, 1405
10 (9th Cir. 1994). In considering motions to dismiss for lack of personal jurisdiction,
11 the Court determines two issues in considering whether the Defendants have
12 purposefully established the minimum contacts with the forum state necessary to
13 grant specific jurisdiction: (1) whether the Defendants purposefully directed their
14 activities at residents of the forum, and (2) whether this litigation is a result of
15 alleged injuries arising out of or related to those activities. Genetic Veterinary
16 Sciences, Inc. v. Canine EIC Genetics, LLC, No. 13-cv-422-TOR, 2014 WL
17 2894301, at *4 (E.D. Wash. June 25, 2014) (citing Burger King v. Rudzewicz, 471
18 U.S. 462, 472-73 (1985)). If these factors are met, the Court considers whether
19 specific jurisdiction would comport with fair play and substantial justice under due
20 process concerns. Int’l Shoe Co. v. Washington, 326 U.S. 310, 320 (1945).
When using affidavits, plaintiffs must demonstrate facts that if true would

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22 support jurisdiction. Doe v. Unocal Corp., 248 F.3d 915, 922 (9th Cir. 2001). Any
23 uncontroverted allegations in the complaint are taken as true; conflicts between
24 parties’ affidavits are resolved in plaintiff’s favor; and the Court construes all
25 evidentiary materials in the light most favorable to plaintiff. Gordon v. Ascentive,
26 LLC, No. CV-05-5079-FVS, 2005 WL 3448025, at *1 (E.D. Wash. Dec. 15, 2005)
27 (citing Ochoa v. J.B. Martin & Sons Farms, 287 F.3d 1182, 1187 (9th Cir. 2002)).
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ORDER ON MOTIONS TO DISMISS ^ 2

Defendant Marc Resnick

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The Court construes pro se Defendant Marc Resnick’s Request for

3 Dismissal, ECF No. 13, as a Fed. R. Civ. P. 12(b)(2) Motion to Dismiss for Lack
4 of Personal Jurisdiction. Per the affidavits and evidence presented, Mr. Resnick
5 co-owned a Washington corporation, and directed Plaintiff to deposit funds into
6 that corporation’s Washington bank account. These funds are the funds alleged to
7 have been fraudulently kept by Defendants. ECF No. 15 at 3; Compl. ¶¶ 1.3 & 3.1.
8 This constitutes directing activities and conducting business in Washington; and
9 the claims in the instant case arise from these actions. Defendant’s blanket
10 assertion that “all defendants in this claim live and operate their business in the
11 state of California,” ECF No. 13 at 1, is insufficient to overcome the Plaintiff’s
12 specific, sworn allegations establishing personal jurisdiction. RCW 4.28.185(1)(a)
13 (granting personal jurisdiction upon “the transaction of any business within this
14 state”).
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The Court next finds jurisdiction over Marc Resnick fair under due process

16 concerns. The defendant has the burden to show personal jurisdiction would be
17 unfair. Core-Vent Corp. v. Nobel Indus. AB, 11 F.3d 1482, 1487-88 (9th Cir.
18 1993). Seven factors are considered: “(1) the extent of the defendants’ purposeful
19 interjection into the forum state[]; (2) the burden on the defendant of defending in
20 the forum; (3) the extent of conflict with the sovereignty of the defendants' state;
21 (4) the forum state's interest in adjudicating the dispute; (5) the most efficient
22 judicial resolution of the controversy; (6) the importance of the forum to the
23 plaintiff's interest in convenient and effective relief; and (7) the existence of an
24 alternative forum.” Id. The Court considers factors raised by the parties. Id.
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First, Marc Resnick raises the second factor, claiming it will burden him to

26 litigate the case from California. There is some merit to this; however, this concern
27 must be balanced with the fact that Marc Resnick co-owned a business based in
28 Washington State.
ORDER ON MOTIONS TO DISMISS ^ 3

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Marc Resnick impliedly raises the third factor, when he alleged that the

2 Orange County Sheriff’s Department is investigating an alleged extortion
3 involving some of the parties in this case. However, the Court finds civil litigation
4 in the Eastern District of Washington will not limit California’s ability to conduct
5 a criminal investigation in California.
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The final factor addressed by the parties involved the possibility of an

7 alternative forum. Marc Resnick suggests he would welcome litigating this case in
8 California. However, co-defendant’s Chere Resnick and Kenvox US reside in
9 Washington; as do the bank accounts in question in this litigation. The other
10 California co-defendants, David and Jane Doe Herrera, are dismissed from this
11 case. Thus, the superiority of an alternative forum is not clearly established.
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Balancing these factors, the Court finds personal jurisdiction over defendant

13 Marc Resnick is fair and comports with due process. Co-owning a Washington
14 business should give Marc Resnick fair warning he may be haled into court in this
15 forum. Thus, Marc Resnick’s Request for Dismissal, ECF No. 13, is denied.
Defendants David Herrera and Jane Doe Herrera

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The Court next considers David and Jane Doe Herrera’s 12(b)(2) Motion to

18 Dismiss for Lack of Personal Jurisdiction, ECF No. 20. David and Jane Doe
19 Herrera’s sworn affidavit states they reside in California, have never lived in or
20 been residents of Washington, and that their only connection to the case is that
21 David Herrera contracted with Marc Resnick to ship watches from China to a U.S.
22 state, not Washington State. ECF No. 20-2. In contrast, Plaintiff only makes bare
23 assertions that David Herrera participated in the alleged conspiracy and the legal
24 conclusion that Herrera conducted business in Washington. Compl. ¶ 3.14; ECF
25 No. 15 at 3. Indeed, Plaintiff has made no specific reply to David Herrera’s
26 motion.
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David and Jane Doe Herrera have shown they have no connection with

28 Washington sufficient to establish specific jurisdiction in this case; their specific
ORDER ON MOTIONS TO DISMISS ^ 4

1 factual allegations defeat the bare assertions of Plaintiff. As a final point, the
2 Court abides by current Ninth Circuit precedent prohibiting the “conspiracy theory
3 of personal jurisdiction.” Chirila v. Conforte, 47 Fed. App’x 838, 842-43 (9th Cir.
4 2002). Thus, David and Jane Doe Herrera’s motion to dismiss, ECF No. 20, is
5 granted.
Defendant Chere Resnick

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The Court now considers Defendant Chere Resnick’s pro se “Request for

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8 Dismissal,” ECF No. 18, which argues that Plaintiff Mirza Minds is “not in good
9 standing” and thus is unable to sue, and that Kenvox US L.L.C. has been defunct
10 since December 31, 2014, and thus is unable to be sued. The Court construes this
11 request as a Fed. R. Civ. P. 12(b)(6) Motion to Dismiss.
Washington law holds that corporations can sue after dissolution if such suit

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13 is part of winding up the corporation’s business and affairs. RCW
14 23B.14.050(2)(e); Ballard Square Condo. Owners Ass’n v. Dynasty Const. Co.,
15 158 Wn. 2d 603, 610 (2006) (en banc). Nevada provides largely the same. N.R.S.
16 § 78.585(1) (two year statute of limitations).
In Washington, canceled or dissolved LLCs can be sued within three years

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18 of the dissolution. RCW 25.15.303; Chadwick Farms Owners Ass’n v. FHC LLC,
19 166 Wn. 2d 178, 193 (2009) (en banc). Chere Resnick states that Kenvox USA has
20 been defunct since December 31, 2014. ECF No. 18 at 1. This places it well within
21 the statute of limitations. See also N.R.S. § 86.505.
Even if this motion were meritorious, it would not excuse Defendant Chere

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23 Resnick from the case; it would only exclude the corporation. See Rowland v. Cal.
24 Men’s Colony, 506 U.S. 194, 202 (1993) (only attorneys may appear on behalf of
25 corporations); Lloyd Enters., Inc. v. Longview Plumbing & Heating Co., 91 Wash.
26 App. 697, 701 (1998) (same). Thus, for the above reasons, Chere Resnick’s
27 Request for Dismissal, ECF No. 18, is denied.
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ORDER ON MOTIONS TO DISMISS ^ 5

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Accordingly, IT IS HEREBY ORDERED:

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1. Defendant Marc Resnick’s Request for Dismissal, ECF No. 13, is

3 DENIED.
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2. Defendant Chere Resnick’s Request for Dismissal, ECF No. 18, is

5 DENIED.
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3. Defendants David and Jane Doe Herrera’s Motion to Dismiss for Lack of

7 Personal Jurisdiction, ECF No. 20, is GRANTED. Defendants David and Jane
8 Doe Herrera are dismissed from this case.
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IT IS SO ORDERED. The District Court Executive is hereby directed to

10 file this Order and provide copies to counsel.
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DATED this 3rd day of November, 2015.

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Stanley A. Bastian

United States District Judge

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ORDER ON MOTIONS TO DISMISS ^ 6