Cymbidium Restoration Trust v. American Homeowner Preservation Trust Series AHP Servicing
2:24-cv-00025
| W.D. Wash. | Jun 28, 2024Background
- Cymbidium Restoration Trust (Cymbidium), a Delaware statutory trust with its principal business in Washington, entered a Mortgage Loan Sale Agreement (MLSA) with AHP Sellers, which included residential loans nationwide.
- Defendant Jorge Newbery, an Illinois resident, acted as CEO/manager of the defendant entities involved in the MLSA, but personally had no connections to Washington outside his corporate role.
- After AHP Sellers allegedly breached the MLSA and an amendment by not repurchasing certain loans as required, Cymbidium sued, including a tort claim for conversion against Newbery.
- Newbery moved to dismiss Cymbidium's complaint against him personally for lack of personal jurisdiction in Washington.
- The case centers on whether Newbery’s allegedly wrongful acts as a corporate officer justify subjecting him to personal jurisdiction in Washington.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| General Personal Jurisdiction | Newbery is subject as CEO of entities doing WA business | No continuous, systematic, or substantial contacts in WA as an individual | No general jurisdiction over Newbery |
| Specific Personal Jurisdiction: Purposeful Acts | Newbery purposefully directed acts at WA via contract | Only contacted WA in corporate role; no acts aimed at WA individually | No specific jurisdiction—no purposeful direction |
| Express Aiming Requirement | Harm to WA-based Cymbidium suffices for express aiming | Plaintiff’s presence in WA alone is insufficient under Walden v. Fiore | No express aiming at WA; Plaintiff's location alone not enough |
| Jurisdiction based on Corporate Officer Actions | Officer’s acts as agent tie him to forum | Only individual’s own forum acts count; can’t impute corporate contacts | Must assess individual contacts; none sufficient here |
Key Cases Cited
- Int’l Shoe Co. v. Washington, 326 U.S. 310 (minimum contacts required for jurisdiction)
- Calder v. Jones, 465 U.S. 783 (effects test for purposeful direction in tort cases)
- Burger King Corp. v. Rudzewicz, 471 U.S. 462 (burden shifts to defendant if prima facie shown)
- Walden v. Fiore, 571 U.S. 277 (jurisdiction must be based on defendant’s own contacts with forum)
- Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797 (outlining three-part test for specific jurisdiction)
- Picot v. Weston, 780 F.3d 1206 (injury must be tied to forum, not just to plaintiff)