Eddie Weathers v. Dieniahmar Music, LLC
337 Ga. App. 816
| Ga. Ct. App. | 2016Background
- Weathers and Mauldin co-founded DML in 2005 as equal 50% members; DML entered a co-publishing agreement with EMI in 2006 providing EMI publication rights and royalty payments to DML.
- EMI paid advances and royalties to DML/Mauldin; Weathers alleges Mauldin diverted or failed to share payments due to Weathers and later obtained additional advances without Weathers’ consent.
- In 2013 Mauldin sold DML to EMI allegedly without Weathers’ authorization, promising Weathers 50% of net proceeds (after accounting for an advance); Weathers received only two $10,000 payments.
- Weathers and his company sued DML, Mauldin, Carter (Mauldin’s manager), and EMI for breach of contract, fraud, conversion, breach of fiduciary duty, tortious interference, and slander of title; many claims against Carter, Mauldin, and DML were dismissed below for failure to state a claim.
- The trial court dismissed EMI for lack of personal jurisdiction; Weathers appealed, arguing Georgia long-arm jurisdiction and that several dismissal rulings were improper and applied the wrong standard.
- The appellate court reversed dismissal for lack of jurisdiction over EMI, reinstated breach-of-contract claims as to Mauldin and DML, reinstated fraud claims as to Mauldin, DML, and Carter, affirmed dismissal as to Carter on breach-of-contract, and instructed correct 12(b)(6) standards on remand.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Personal jurisdiction over EMI under GA Long-Arm (OCGA § 9-10-91(1)) | EMI transacted business with Georgia DML (co-publishing, royalties, studio presence, eventual purchase), so Georgia courts have jurisdiction | EMI had no physical presence in Georgia and only limited remote contacts (phone, mail, internet); insufficient for jurisdiction | Reversed: jurisdiction proper — EMI purposefully transacted business tied to Georgia and exercise of jurisdiction is reasonable |
| Breach of contract vs. Carter | Weathers alleged Carter aided misrepresentations and withheld proceeds | Carter had no contract with Weathers and no privity supporting breach claim | Affirmed dismissal as to Carter — no contractual basis pleaded |
| Breach of contract vs. Mauldin and DML | Operating agreement (co-ownership) and revenues/sale proceeds should have been shared; allegations support breach | Defendants moved to dismiss for failure to state a claim | Reversed dismissal as to Mauldin and DML — complaint sufficiently alleges facts that could support breach once proven |
| Fraud vs. Mauldin, DML, and Carter | Defendants falsely represented a trust and imminent payment of sale proceeds; Weathers relied and was injured | Defendants sought dismissal for insufficient particularity/evidence | Reversed dismissal — fraud pleaded with required particularity at pleading stage; discovery may develop proof |
Key Cases Cited
- Innovative Clinical & Servs. v. First Nat. Bank & Trust Co., 279 Ga. 672 (Supreme Court of Ga.) (interpreting “transacts any business” broadly under OCGA § 9-10-91(1))
- American College Connection, Inc. v. Berkowitz, 332 Ga. App. 867 (Ga. Ct. App.) (long-arm jurisdiction may rest on telephonic, mail, internet contacts and in-state business operations such as leased studios)
- Crossing Park Properties, LLC v. JDI Fort Lauderdale, LLC, 316 Ga. App. 471 (Ga. Ct. App.) (contacts with Georgia provide fair warning of suit)
- Paxton v. Citizens Bank & Trust of West Ga., 307 Ga. App. 112 (Ga. Ct. App.) (burden on nonresident to show lack of jurisdiction; factual disputes resolved for plaintiff when no evidentiary hearing)
- Common Cause/Georgia v. City of Atlanta, 279 Ga. 480 (Supreme Court of Ga.) (standard for dismissal under OCGA § 9-11-12(b)(6))