Alan Grayson v. Randolph Anderson, 816 F.3d 262

Victims of a South Carolina–centered Ponzi scheme (the “90% Stock Loan Program”) obtained a $150m+ judgment against Derivium and others; some plaintiffs (Grayson, AMG Trust, Grayson Consulting) later sued additional participants.
Vision International People Group (Cyprus) was sued; after full discovery it moved under Fed. R. Civ. P. 12(b)(2) to dismiss for lack of personal jurisdiction. The district court held an oral hearing but took no live testimony and granted dismissal, applying a preponderance standard.
Separately, Grayson and AMG Trust sued Randolph Anderson, Patrick Kelley, and Total Eclipse International Ltd. for aiding and abetting common‑law fraud; at trial the district court granted JMOL for those defendants, concluding South Carolina does not recognize such a cause of action.
Plaintiffs appealed both rulings: (1) arguing the district court should have applied a prima facie standard (because there was no “evidentiary hearing” with live testimony) on the 12(b)(2) motion; and (2) arguing Connelly v. State Co. recognizes aiding and abetting common‑law fraud in South Carolina.
The Fourth Circuit consolidated the appeals and affirmed: (1) the district court correctly applied the preponderance standard after full discovery and a hearing (live testimony not required); and (2) South Carolina has not recognized a standalone aiding‑and‑abetting common‑law fraud cause of action, so the JMOL was proper.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Personal jurisdiction over Vision International under Rule 12(b)(2) / S.C. long‑arm and Fed. R. Civ. P. 4(k)(2)	Because the district court did not hold an “evidentiary hearing” with live testimony, plaintiffs needed only a prima facie showing; facts should be viewed in their favor	Court could require proof by a preponderance after full discovery; live testimony not required; contacts insufficient	Affirmed: after full discovery and a hearing, court properly weighed evidence, applied preponderance standard, and found no personal jurisdiction
Existence of cause of action for aiding and abetting common‑law fraud under South Carolina law	Connelly (1929) and other authority support recognition of aiding and abetting common‑law fraud	South Carolina has not recognized such a cause of action; Connelly does not create one; federal courts sitting in diversity should not expand state law	Affirmed: South Carolina has not recognized aiding and abetting common‑law fraud; JMOL for defendants proper

Combs v. Bakker, 886 F.2d 673 (4th Cir. 1989) (plaintiff bears burden of proving jurisdiction; jurisdictional issues for judge)
Mylan Labs., Inc. v. Akzo, N.V., 2 F.3d 56 (4th Cir. 1993) (prima facie standard when court relies on pleadings and affidavits)
New Wellington Fin. Corp. v. Flagship Resort Dev. Corp., 416 F.3d 290 (4th Cir. 2005) (plaintiff must eventually prove jurisdiction by preponderance at trial or evidentiary hearing)
Boit v. Gar‑Tec Prods., Inc., 967 F.2d 671 (1st Cir. 1992) (evidentiary hearing need not involve live testimony; affidavit/deposition evidence may suffice)
Young v. F.D.I.C., 103 F.3d 1180 (4th Cir. 1997) (employee acting for independent purpose falls outside scope of employment for vicarious liability)
Base Metal Trading, Ltd. v. OJSC Novokuznetsky Aluminum Factory, 283 F.3d 208 (4th Cir. 2002) (scope and application of Fed. R. Civ. P. 4(k)(2))
ESAB Grp., Inc. v. Zurich Ins. PLC, 685 F.3d 376 (4th Cir. 2012) (South Carolina long‑arm analysis and constitutional due process overlap)
Carefirst of Md., Inc. v. Carefirst Pregnancy Ctrs., Inc., 334 F.3d 390 (4th Cir. 2003) (standard of review: de novo legal review, factual findings for clear error)
Connelly v. State Co., 149 S.E. 266 (S.C. 1929) (state case relied on by plaintiffs; court interpreted it as not establishing an aiding‑and‑abetting fraud cause of action)
Burris Chem., Inc. v. USX Corp., 10 F.3d 243 (4th Cir. 1993) (federal courts must apply state law as it exists and should not expand it)