This matter comes before the Court on five separate motions to dismiss filed by (1) MCG Cane Bay, LLC ("MCG Cane Bay"); (2) BMB-MCG, LLC ("BMB-MCG"); (3) BMB Investments, LLC ("BMB Investments") and BOMA LC ("BOMA"); (4) Kory Reimann ("Mr. Reimann"); and (5) Mark Brown ("Mr. Brown") (cumulatively, the "moving defendants").
I. BACKGROUND AND PROCEDURAL HISTORY
Plaintiff is a New York Corporation with a principal place of business in Asbury Park, New Jersey, that acquires and develops *421real property. Amended Complaint ("Am. Compl."), ¶ 1. Mark Line, a limited liability company ("LLC"), is a custom fabricator of modular units and buildings, and its principal place of business is located in Indiana. Id. ¶ 2. The other defendant entities are affiliated with Mark Line and also maintain their principal places of business outside of New Jersey, in Florida, Utah, or Minnesota. Id. ¶¶ 2-10. Moreover, the individual defendants, all of whom served in a corporate capacity at either Mark Line or an affiliated entity, do not reside in New Jersey. Id. ¶¶ 11-15.
As alleged in the Amended Complaint, on January 13, 2016, Linus entered into a Manufacturer's Development Agreement ("MDA") with Mark Line. Id. ¶ 22. Pursuant to its terms, Linus tendered $ 37,125 in exchange for Mark Line agreeing to produce design documents for modular units. Id. Linus intended to utilize those documents in connection with the development of a mixed-use building, including forty-eight residential units, in Asbury Park, New Jersey (the "Project"). Id. ¶¶ 21-22.
On October 7, 2016, Linus entered into an additional contract with Mark Line (the "Agreement"), for the production and purchase of modular units for the Project. Id. ¶ 23. According to Plaintiff, Mr. Remke and Mr. Blockno, as the "Manager, Director, Principal, and/or President" of Mark Line, negotiated the terms of the Agreement. Id. ¶¶ 11, 13, 24. Pursuant to Paragraph 35 of the contract, Mark Line was required to secure Performance and Payment Bonds ("Bonds") in order to guarantee its obligations under the Agreement and protect Linus's interests. Id. ¶¶ 24-25. The Bonds also served as a prerequisite to Linus's obligation to tender a 20% deposit in the amount of $ 790,000, the payment of which was allegedly necessary for Mark Line to purchase Project materials. Id. ¶¶ 26-27.
On October 12, 2016, notwithstanding the receipt of Linus's deposit, Plaintiff alleges that Mark Line failed to obtain the Bonds. Id. ¶ 30. In fact, according to Plaintiff, Mark Line did not possess such an ability when it executed the Agreement, because it had a negative cash flow and insufficient funds. Id. ¶ 32. In that connection, Mark Line allegedly required Linus's deposit for the purpose of covering payroll, as opposed to the purchase of materials for the Project. Id. ¶ 33. On March 24, 2017, Linus ultimately terminated the Agreement, as a result of Mark Line's alleged failure to obtain the Bonds and, in turn, demanded the immediate reimbursement of the $ 790,000 deposit and initial $ 37,125 payment. Id. ¶ 39. However, Mark Line allegedly refused to comply with these requests. Id. ¶ 40.
Moreover, Plaintiff alleges that from 2016 through 2017, Mark Line transferred "for little or no consideration" significant sums of money to its corporate parents and other related entities, including: (a) $ 28,000 to BMB Investments and BMB-MCG in October of 2016; (b) $ 770,000 to Mosaic Capital in 2016 and 2017; (c) $ 130,000 to Dignicare in 2016; (d) $ 390,000 to Earth Trades in March and April of 2016; (e) $ 100,000 to Mosaic Development Corp. in the fall and winter of 2016; and (f) $ 304,000 to MCG Cane Bay in 2016 and 2017. Id. ¶ 43(a-g). According to Plaintiff, these transfers violated Mark Line's Operating Agreement,
On May 24, 2017, as a result of these events, Plaintiff filed the instant action. The thirteen-count Amended Complaint asserts the following claims against the corporate and individual defendants: (1) breach of contract; (2) conversion; (3) unjust enrichment; (4) breach of the duty of good faith and fair dealing; (5) alter ego; (6) piercing the corporate veil; (7) fraudulent inducement and misrepresentation; (8) negligent misrepresentation; (9) fraud pursuant to the New Jersey Consumer Fraud Act; (10) accounting of funds; (11) fraudulent transfers; (12) breach of fiduciary duties; and (13) corporate waste.
Currently, MCG Cane Bay, BMB-MCG, BMB Investments, BOMA, as well as Mr. Reimann and Mr. Brown, separately move for dismissal. The moving defendants, among other things, challenge this Court's lack of personal jurisdiction over them. Plaintiff has opposed the motions.
II. DISCUSSION
A. Standard of Review
To withstand a motion to dismiss for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2), a plaintiff bears the burden of establishing the court's personal jurisdiction over the moving defendant by a preponderance of the evidence. D'Jamoos ex rel. Estate of Weingeroff v. Pilatus Aircraft Ltd. ,
"A district court sitting in diversity may assert personal jurisdiction over a nonresident defendant to the extent allowed under the law of the forum state." Metcalfe v. Renaissance Marine, Inc. ,
*423Malik v. Cabot Oil & Gas Corp. ,
"The Due Process Clause of the Fourteenth Amendment sets the outer boundaries of a state tribunal's authority to proceed against a defendant." Goodyear Dunlop Tires Operations, S.A. v. Brown ,
Relevant here, a court may impute the contacts of a subsidiary corporation to a foreign parent corporation for the purpose of exercising specific jurisdiction, if the subsidiary corporation is merely operating as the parent corporation's alter ego, such that the "independence of the separate corporate entities [may be] disregarded."
B. Piercing the Corporate Veil
As a threshold issue, the moving defendants contend that the Court lacks personal jurisdiction over them. In support, the moving defendants have provided sworn certifications which demonstrate that they are neither incorporated nor maintain a principal place of business in the State. Nor does this action, according to the moving defendants, arise from their continuous and systematic contacts in New Jersey-they have never advertised, engaged in, or solicited business in the State. Plaintiff does not directly dispute these allegations, but rather contends that this Court may exercise personal jurisdiction, on the basis of its alter ego and veil-piercing claims. Plaintiff maintains that Mark Line's contacts with the State, i.e. , executing a contract with Linus, a New Jersey entity, for the production of modular units in New Jersey, may be imputed to the moving defendants for specific jurisdiction purposes. In that connection, because the sufficiency of Mark Line's contacts with New Jersey is not challenged, the jurisdictional *424inquiry, here, is confined to the issue whether Plaintiff's veil-piercing and alter ego claims provide sufficient grounds for exercising personal jurisdiction over the moving defendants.
Plaintiff's veil-piercing and alter ego theories arise solely from a series of transactions, occurring in 2016 and 2017. Am. Compl. ¶¶ 86-106. Specifically, during the course of this period, Plaintiff alleges that Mark Line "freely transferred" $ 1.5 million in assets to the affiliated entities, "without reasonable or adequate consideration," and, in turn, Mark Line was rendered undercapitalized, insolvent, and without the financial ability to obtain Performance and Payment Bonds under the Agreement. Plaintiff's Brief in Opposition to Motion to Dismiss ("Pl.'s Opp."), at 16, 26. In that regard, having become financially dependent upon the affiliated entities as a result of the disputed transfers, Plaintiff contends that the affiliated entities served as the alter egos for Mark Line, and, as such, are ultimately liable for Mark Line's inability to perform its contractual obligations.
The Court's veil-piercing inquiry begins by first determining which state's law to apply in resolving the instant dispute. see United States ex rel. Pilecki-Simko v. Chubb Inst. , No. 06-3562,
In that regard, while the moving defendants argue that the NJLLCA mandates an application of Florida or Utah law, they, nevertheless, concede that an application of New Jersey law will ultimately lead to the same outcome. Indeed, according to the moving defendants, and not disputed by Plaintiff, New Jersey's veil-piercing framework is substantially similar to the veil-piercing framework under the laws of Florida and Utah. Therefore, because Plaintiff's success on this motion is not contingent upon an application of Florida, Utah, or New Jersey law, the Court proceeds to apply the laws of New Jersey in determining whether Plaintiff has alleged a plausible veil-piercing claim. See, e.g. , Torus United States Servs., Inc. ,
Pursuant to the laws of New Jersey, it is axiomatic that "a corporation is a separate entity from its shareholders, and that a primary reason for incorporation *425is the insulation of shareholders from the liabilities of the corporate enterprise." State Dept. of Environmental Protection v. Ventron Corp. ,
Specifically, in New Jersey and most other jurisdictions, two elements must be shown to pierce the corporate veil: "First, there must be such unity of interest and ownership that the separate personalities of the corporation and the individual no longer exist. Second, the circumstances must indicate that adherence to the fiction of separate corporate existence would sanction a fraud or promote injustice." State Capital Title & Abstract Co. v. Pappas Bus. Servs., LLC ,
In determining whether a unity of interest and ownership exists under the first prong, the Third Circuit has applied six non-binding factors to guide this inquiry: [1] gross undercapitalization ...; [2] the failure to observe corporate formalities, non-payment of dividends, [3] the insolvency of the debtor corporation at the time, [4] siphoning of funds of the corporation by the dominant stockholder, [5] non-functioning of other officers or directors, absence of corporate records, and [6] the fact that the corporation is merely a facade for the operations of the dominant stockholder or stockholders. Craig v. Lake Asbestos of Quebec, Ltd. ,
Here, as a preliminary matter, Plaintiff attempts to pierce Mark Line's corporate veil in order to impose liability upon a total of thirteen defendants, including eight LLC entities and five corporate officials.
First, Plaintiff contends that Mark Line was "grossly undercapitalized," because the disputed transfers resulted in its insolvency. Pl.'s Opp., at 12. However, Plaintiff conflates the issue of undercapitalization with the issue of insolvency in support of its veil-piercing allegations. Indeed, while there is a "substantial overlap," the Third Circuit has explained that these two concepts are often confused and, for veil-piercing purposes, "mere insolvency is distinct from under capitalization." Trs. of the Nat'l Elevator Indus. Pension, Health Benefit & Educ. Funds v. Lutyk ,
More to the point, Plaintiff does not allege any facts with respect to the appropriate level of capital that, considering its size, Mark Line required in order to operate as a successful business within its industry. Therefore, having failed to provide any information in this regard, Plaintiff has not sufficiently demonstrated that Mark Line was undercapitalized at the time of its formation. Las Vegas Sands Corp. v. ACE Gaming, LLC ,
Second, Mark Line's insolvency, which allegedly occurred as a result of the disputed transfers to the affiliated entities, also fails to justify Plaintiff's alter ego and veil-piercing claims. Indeed, Plaintiff has not sufficiently alleged that Mark Line operated as a sham or a dummy corporation, but rather maintains, in a conclusory fashion, that the affiliated entities and the individual defendants "were part of the *427scheme to remove funds from Mark Line in order to defraud Linus." Pl.'s Opp., at 17-18. In addition, Plaintiff avers that the alleged fraudulent transfers violated Mark Line's own Operating Agreement, that they occurred while the company was in financial distress, and there exists no evidence from which to conclude that Mark Line ultimately received "any legitimate consideration" from the affiliated entities in return. Id. at 18, 22. The moving defendants argue, however, that the transfers were permissible "affiliate advances" which were recorded on its balance sheets, and Plaintiff's arguments with respect to the financial health of Mark Line, at the time of the disputed transfers, are based on an inaccurate interpretation of its financial statements.
Here, although Plaintiff argues that Mark Line fraudulently diverted its assets on the basis of its alleged financial distress and disregard of its own Operating Agreement, Plaintiff cannot solely rely on the disputed transfers, in of themselves, for the purpose of piercing the corporate veil. Rather, Plaintiff must plead specific facts with respect to how the affiliated entities and individuals allegedly controlled or dominated Mark Line. Ramirez v. STI Prepaid LLC ,
In that regard, Plaintiff purports to demonstrate the requisite level of control or dominance by arguing as follows: (1) an executive overlap between Mark Line and the affiliated entities existed, as Mr. Reimann, acting on the behalf of Mr. Brown, allegedly served in a managerial capacity over both Mark Line and the affiliated entities; and (2) the corporate structure of the affiliated entities reveals that they are "interrelated." Pl.'s Opp., at 13, 17-18. However, Plaintiff's allegations are insufficient for the purpose of showing an alter ego relationship between Mark Line and the affiliated entities, nor do they provide a proper basis for imposing personal liability upon Mr. Reimann and Mr. Brown.
Indeed, although Plaintiff alleges that, while "Reimann served as the President of Mark Line Industries[,]" certain entities "over which he served as sole Manager" received transfers, it is well-established that "common ownership and common management alone" are insufficient for veil-piercing purposes. RNC Sys. v. MTG Holdings, LLC , No. 15-5239,
In addition, Plaintiff's contentions with respect to the managerial and ownership structure of Mark Line and the affiliated entities do not account for their designations as LLCs. In fact, as LLCs, these entities are "deliberately" provided with "organizational flexibility," and, in that same vein, need not function as a formally run corporation. COTY US LLC v. 680 S. 17th St. LLC , No. 122-13,
Third, although Plaintiff contends that the disputed transfers constitute a disregard of corporate formalities, the pertinent law in New Jersey provides: "[t]he failure of a limited liability company to observe any particular formalities relating to the exercise of its powers or management of its activities is not a ground for imposing liability on the members or managers for the debts, obligations, or other liabilities of the company."
At best, Plaintiff's allegations demonstrate a misuse or mismanagement of corporate funds that ultimately resulted in Mark Line's inability to sustain its business operations. However, these situations frequently occur within the corporate realm, and, with nothing more, cannot constitute the "specific, unusual circumstances" which are required for veil-piercing purposes. Lutyk ,
Accordingly, because Plaintiff has failed to adequately allege its claim of alter ego or veil-piercing, the Court has no basis to exercise specific jurisdiction over the moving defendants. Therefore, because personal jurisdiction is lacking, the parties' remaining arguments with respect to the sufficiency of certain claims pled in the Amended Complaint need not be addressed. Lastly, should additional discovery reveal information which demonstrates the requisite level of control or dominance between Mark Line and the affiliated entities and individuals, Plaintiff may move to amend the Complaint before the Magistrate Judge.
III. CONCLUSION
For the foregoing reasons, the moving defendants' motions to dismiss are GRANTED . All claims against the moving defendants are dismissed without prejudice for lack of personal jurisdiction.
In the Amended Complaint, Plaintiff also names the following individuals and entities as defendants: Mark Line Industries, LLC ("Mark Line"); Mark Line Holdings, LLC ("Mark Line Holdings"); Mosaic Capital Group, LLC ("Mosaic Capital"); Dignicare Senior Management, LLC ("Dignicare") (together, with MCG Cane Bay, BMB-MCG, BMB Investments, and BOMA the "affiliated entities"); Paul Mascia; Christopher Remke; and Joseph Blockno. Default has been entered against Mosaic Capital, and the other named entities or individuals have not moved for dismissal of the Amended Complaint.
Specifically, Plaintiff alleges that Mark Line's Operating Agreement only permitted the distribution of net cash from operations, defined as "the gross proceeds less portion used to pay expenses, debt, payroll, capital expenses," to its sole member, Mark Line Holdings. Am. Compl., ¶ 47.
For specific jurisdiction purposes, alter ego and veil-piercing are typically alleged in order to impute the forum contacts of a subsidiary corporation to a foreign parent corporation, or vice versa. Here, in order to impute Mark Line's contacts to, and establish jurisdiction over, thirteen defendants that comprise of eight related entities and five corporate officials, Plaintiff seeks to pierce the corporate veil. However, Plaintiff does not allege that all of the defendant entities and individuals served as either a parent corporation or controlling shareholder over Mark Line, as is traditionally required under alter ego and veil-piercing theories. In fact, the affiliation between Mark Line and the related entities and individuals is not entirely clear based on Plaintiff's allegations in the Amended Complaint. And, I question whether personal jurisdiction can be obtained by way of alter ego in the circumstances alleged by Plaintiff. Nevertheless, the LLC defendants do not dispute personal jurisdiction on these grounds, nor do I need to decide this issue, because Plaintiff has failed to allege a plausible basis for veil-piercing, as further discussed infra .
As previously indicated, veil-piercing occurs, and the corporate form is disregarded, when a subsidiary "is so dominated by its corporate parent as to be the parent's alter ego." In re Owens Corning ,
Aside from merely identifying their positions as a "Manager, Director, Principal, and/or President" of Mark Line or an affiliated entity, Plaintiff also does not plead any substantive facts with respect to Paul Mascia, Christopher Remke, and Joseph Blockno, which demonstrate how they allegedly controlled or dominated Mark Line.
For purposes of completeness, the Court notes that the laws in Florida and Utah in connection with the adherence of formalities by LLCs are substantially similar to the laws in New Jersey. Indeed, in both Florida and Utah, "[t]he failure of a limited liability company to observe formalities relating to the exercise of its powers or management of its activities and affairs is not a ground for imposing liability on a member or manager of the limited liability company for a debt, obligation, or other liability of the limited liability company." U.C.A. § 48-3-304 ; F.S.A. § 605.0304.
Although Plaintiff further alleges that, on various occasions, some of the affiliated entities improperly assumed Mark Line's liabilities, that additional allegation, on balance, is insufficient to pierce the corporate veil for the purpose of imposing liability upon thirteen separate but affiliated entities and individuals.