Children's Legal Services, PLLC v. Shor Levin & Derita, PC
850 F. Supp. 2d 673
E.D. Mich.2012Background
- CLS filed suit in Michigan federal court against Shor Levin alleging breach of a settlement, fraud, promissory estoppel, unjust enrichment, and related relief over a 4MyChild/4MyBaby marketing program and related fee arrangements.
- Shor Levin moved to dismiss for lack of personal jurisdiction or improper venue, or to transfer to the Eastern District of Pennsylvania.
- The dispute traces a Michigan-based advertising program funded and operated through Michigan- and Pennsylvania-based firms, with cross-border referrals and fees; CLS later purchased Stern/Korn assets and related 4MyChild rights from a bankruptcy estate.
- Michigan contacts include calls handled and cases processed in Michigan, advertising funds routed through Michigan entities, and a settlement involving Michigan-based firms; the 2005 Pennsylvania oral settlement connects the parties across forums.
- The court held that Shor Levin has sufficient Michigan-related contacts to support limited personal jurisdiction, venue is proper in Michigan, and transfer to Pennsylvania would be inappropriate; thus the motion to dismiss for lack of jurisdiction or improper venue or to transfer was denied.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Michigan may exercise personal jurisdiction over Shor Levin. | Shor Levin transacted business in Michigan; activities relate to the claim and create continuing obligations. | No substantial Michigan contacts; activity centered in Pennsylvania; no arise-from nexus. | Yes; limited personal jurisdiction is satisfied. |
| Whether venue is proper in the Eastern District of Michigan. | Venue lies where defendant resides or is subject to jurisdiction; Michigan is proper. | Defendant seeks transfer to Pennsylvania; argues improper venue. | Yes; venue is proper in Michigan. |
| Whether the case should be transferred to the Eastern District of Pennsylvania for convenience. | Plaintiff’s forum is preferred; transferring would unnecessarily inconvenience CLS. | Pennsylvania is a more convenient forum; related matters are ongoing there. | No; transfer denied. |
Key Cases Cited
- Neogen Corp. v. Neo Gen Screening, Inc., 282 F.3d 883 (6th Cir. 2002) (prima facie jurisdiction burden in 12(b)(2) motions; need for reasonable contacts)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (U.S. 1985) (purposeful availment; quality of contacts matters)
- Lanier v. American Board of Endodontics, 843 F.2d 901 (6th Cir. 1988) (arising-from analysis; contacts made possible the action)
- Theunissen v. Matthews, 935 F.2d 1454 (6th Cir. 1991) (test for limits of personal jurisdiction; connections and reasonableness)
- Air Prods. & Controls, Inc. v. Safetech Int'l, Inc., 503 F.3d 544 (6th Cir. 2007) (purposeful availment and connection to forum; reasonableness factors)
- Calphalon Corp. v. Rowlette, 228 F.3d 718 (6th Cir. 2000) (merger of long-arm and due process inquiries when statute extends to due process)
- LAK, Inc. v. Deer Creek Enters., 885 F.2d 1293 (6th Cir. 1989) (purposeful contacts; volume alone not sufficient)