DV Injury Law, PLLC v. Tort Private Investigations LLC, 5:24-cv-12772

Background

Plaintiffs DV Injury Law, PLLC and HAH, LLP sued David Bauman, Sarah Hale Bauman, Bentley Consulting, LLC, and Tort Private Investigations, LLC, alleging misrepresentations that induced Plaintiffs to contract and resulted in over $2,000,000 in losses.
Plaintiffs allege the Baumans personally represented they would form Bentley, signed the contract, and misrepresented TPI’s staffing and capabilities, knowing many claimants were Michigan residents.
Defendants moved to dismiss under Fed. R. Civ. P. 12(b)(2) for lack of personal jurisdiction or, alternatively, on forum non conveniens grounds.
Magistrate Judge Patti recommended denying the motion, finding specific personal jurisdiction over all defendants and that forum non conveniens did not require dismissal.
Defendants objected only to the magistrate judge’s personal-jurisdiction analysis as applied to the individual defendants (the Baumans); the district court reviewed the objection de novo.
The district court overruled the objection, adopted the R&R, and denied defendants’ motion to dismiss, holding specific jurisdiction exists under Michigan’s long-arm statute and the Due Process Clause.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether court has specific personal jurisdiction over individual defendants	Bauman and Hale personally made misrepresentations to Michigan plaintiffs, formed Bentley, signed contracts, and caused consequences in Michigan (losses to Michigan plaintiffs).	Jurisdiction over corporate defendants does not automatically extend to individual officers; plaintiffs alleged no distinct facts tying the Baumans personally to Michigan.	Held: Specific jurisdiction exists over the Baumans under Mich. Comp. Laws §600.705(1) and (2) because of their personal acts and consequences in Michigan.
Whether exercise of jurisdiction comports with Due Process	The Baumans purposefully availed themselves by personally communicating with and inducing Michigan-based plaintiffs, so the suit arises from those contacts and jurisdiction is reasonable.	Litigating in Michigan is burdensome; defendants reside in California, and corporate contacts alone are insufficient to satisfy due process as to individuals.	Held: Due process satisfied — purposeful availment, nexus to the cause of action, and reasonableness support jurisdiction.
Whether general jurisdiction exists over individual defendants	(Not argued by Plaintiffs; focused on specific jurisdiction)	Defendants assert no basis for general jurisdiction (not domiciled, not served in Michigan).	Held: Court did not rely on general jurisdiction and found specific jurisdiction sufficient.
Whether forum non conveniens requires dismissal	Plaintiffs: Michigan is appropriate forum; defendants did not show dismissal warranted.	Defendants argued forum non conveniens should apply (alternative to lack of jurisdiction).	Held: R&R’s forum non conveniens analysis unchallenged by defendants and court agreed dismissal on that basis is unwarranted.

Key Cases Cited

Neogen Corp. v. Neo Gen Screening, Inc., 282 F.3d 883 (6th Cir. 2002) (personal-jurisdiction principles and "slightest act of business" standard)
Theunissen v. Matthews, 935 F.2d 1454 (6th Cir. 1991) (three-part minimum-contacts test for specific jurisdiction)
Int'l Shoe Co. v. Washington, 326 U.S. 310 (U.S. 1945) (due-process minimum contacts standard)
Air Prods. & Controls, Inc. v. Safetech Int'l, Inc., 503 F.3d 544 (6th Cir. 2007) (reasonableness factors in due-process inquiry)
AlixPartners, LLP v. Brewington, 836 F.3d 543 (6th Cir. 2016) (burden of defending out-of-state suit does not alone defeat reasonableness)
Balance Dynamics Corp. v. Schmitt Indus., 204 F.3d 683 (6th Cir. 2000) (corporate officer status does not shield an individual from jurisdiction when personally involved in wrongdoing)
Miller v. AXA Winterthur Ins. Co., 694 F.3d 675 (6th Cir. 2012) (distinction between general and specific jurisdiction)
MAG IAS Holdings, Inc. v. Schmückle, 854 F.3d 894 (6th Cir. 2017) (inference of reasonableness when purposeful availment and nexus are shown)