Tactacell L L C v. Deer Management Systems L L CTactacell L L C v. Deer Management Systems L L C
MEMORANDUM RULING
Before the Court is DEER MANAGEMENT SYSTEMS, LLC‘S MOTION TO DISMISS UNDER
BACKGROUND
This matter stems from a business dispute between two companies. In January of 2020, Jeff Peel, the manager and owner of Deer Management, contacted Matt Busbice, a resident of Louisiana and the manager and sole owner of Tactacell, seeking help with the development of a “trail camera” to be used for hunting purposes (the “Reveal Trail Camera“). [Doc. 1, 13-15]. The two companies soon began extensive negotiations of an “Independent Contractor Agreement” (the “Agreement“) through a series of emails, text messages, and phone calls from their respective domiciles. [Doc. 10, p. 5]. The Agreement anticipated a long-term relationship during which Tactacell would provide testing, consulting, and marketing services to Deer Management. [Id. at ¶¶ 15, 19]. In exchange for these services, Deer Management would pay annual disbursements to Tactacell. [Doc. 10, p. 5].
The companies’ relationship began to sour soon thereafter. Tactacell claims it dutifully performed services in accordance with the Agreement yet did not receive payments from Deer Management. [Doc. 1, ¶¶ 24-30]. Tactacell also contends that Deer Management failed in its obligation to provide annual accountings and improperly sought to terminate the Agreement on June 10, 2021. [Id.].
On March 22, 2022, Plaintiff brought the above-captioned matter under this Court‘s diversity jurisdiction. [Doc. 1];
ANALYSIS
I. Personal Jurisdiction
Deer Management first urges that the Court dismiss Plaintiff‘s Complaint without prejudice because it lacks personal jurisdiction. As the plaintiff, Tactacell bears the burden of demonstrating federal jurisdiction. Sureshot Gold Ventures, Inc. v. Topgolf Int‘l, Inc., 754 Fed.Appx. 235, 239 (5th Cir. 2018) (citing Stockman v. FEC, 138 F.3d 144, 151 (5th Cir. 1998). In evaluating jurisdiction, all uncontroverted allegations in the complaint are taken as true and factual conflicts are resolved in the plaintiff‘s favor. Diece-Lisa Indus., Inc. v. Disney Enters., Inc. 943 F.3d 239, 249 (5th Cir. 2019).
“A federal court may exercise personal jurisdiction over a nonresident defendant if (1) the forum state‘s long-arm statute confers personal jurisdiction over that defendant; and (2) the exercise of personal jurisdiction comports with the Due Process Clause of the Fourteenth Amendment.” McFadin v. Gerber, 587 F.3d 753, 759 (5th Cir. 2009). Louisiana‘s long-arm statute,
Under the Due Process Clause, a court may exercise personal jurisdiction
Here, the Plaintiff only alleges that the Court has specific personal jurisdiction. The Fifth Circuit has developed a three-part test for evaluating specific jurisdiction as follows:
“First, the defendant must purposefully avail[] itself of the privilege of conducting activities in the forum State.” Ford Motor Co. v. Mont. Eighth Jud. Distr. Ct., 141 S. Ct. 1017, 1024 (2021) (cleaned up). The defendant‘s ties to the forum, in other words, must be ties that ‘the defendant himself purposefully forged.’ Diece-Lisa, 943 F.3d at 250 (quoting Walden v. Fiore, 571 U.S. 277, 284, (2014)) (cleaned up). Second, the plaintiff‘s claim ‘must arise out of or relate to’ those purposeful contacts. Id. at 1025. A defendant may have many meaningful ties to the forum, but if they do not connect to the plaintiff‘s claim, they cannot sustain our power to hear it. Third, exercising our jurisdiction must be ‘fair and reasonable’ to the defendant. Seiferth v. Helicopteros Atuneros, Inc., 472 F.3d 266, 271 (5th Cir. 2006).”
Johnson, 21 F.4th at 317-18 (emphasis in original). If the plaintiff can successfully establish the first two prongs, the burden then shifts to the defendant to show that exercising jurisdiction would prove unfair or unreasonable. Monkton Ins. Servs., Ltd. v. Ritter, 768 F.3d 429, 433 (5th Cir. 2014).
Given Tactacell‘s allegations in the Complaint, the Court finds that Defendant‘s contacts with Louisiana giving rise to this dispute support this Court‘s exercise of personal jurisdiction. Under the facts alleged, Deer Management initiated contractual negotiations with Tactacell, a resident of Louisiana. Following this initial contact, the parties engaged in “extensive negotiations” through emails, texts, and phone calls, each from their respective domiciles. However, most critical to the Court‘s analysis is the parties’ mutual expectation that the services contemplated in the Agreement would be provided by the Plaintiff – at Defendant‘s direction – in Louisiana. See, [Doc. 4-5, p. 5]. This, in conjunction with: (i) Plaintiff‘s alleged rendering of those services in Louisiana; and (ii) the Defendant‘s shipment of a test product to Louisiana, clearly establish that the Defendant purposefully directed its contacts toward Louisiana. See, Walden v. Fiore, 571 U.S. 277, 285 (2014) (“although physical presence in the forum is not a prerequisite to jurisdiction, ... physical entry into the State – either by the defendant in person or through an agent, goods, mail, or some other means – is certainly a relevant contact“).
Once minimum contacts have been established, the defendant must make a compelling case that it would be unreasonable for this Court to exercise jurisdiction. Wien Air Alaska, Inc. v. Brandt, 195 F.3d 208, 215 (5th Cir. 1999). Deer Management has failed to do so here. To this end, the Court finds that the burden of requiring Defendant to defend this case in Louisiana is no greater than the burden caused by Plaintiff if it were required to litigate this matter in Minnesota. Central Freight Lines Inc. v. APA Transport Corp., 322 F.3d 376, 382 (5th Cir. 2003). Accordingly, because Deer Management: (i) purposely entered into a contract with a Louisiana LLC; (ii) for the performance of work that the parties anticipated would largely take place in Louisiana, and (iii) it is from the Defendant‘s alleged breach of this contract that this dispute arises, this Court maintains personal jurisdiction over the Defendant in this action.
II. Venue
Deer Management next argues that the Court should dismiss this action because the Western District of Louisiana is not a proper venue. The burden is on a plaintiff to establish that venue is proper in the judicial district where the case has been brought. Perez v. Pan Am. Life Ins. Co., 70 F.3d 1268 at *2 (5th Cir. 1995). When analyzing a Rule 12(b)(3) motion, the court must accept all allegations in the complaint as true and resolve all conflicts in favor of the plaintiff. Braspetro Oil Servs. Co. v. Modec (USA), Inc., 240 Fed.Appx. 612, 615 (5th Cir. 2007). The court may consider evidence beyond the facts alleged in the complaint and its proper attachments. Ambraco, Inc. v. Bossclip B.V., 570 F.3d 233, 238 (5th Cir. 2009).
The Court finds that venue is proper in this District because it is a location where the parties anticipated the performance of the Agreement would take place. See, American Carpet Mills v. Gunny Corp., 649 F.2d 1056, 1059 (5th Cir. 1981). In addition, Deer Management sent a test product to Louisiana, Deer Management allegedly breached the contract by failing to send payments to Louisiana, certain pre-Agreement negotiations occurred in Louisiana, and the Agreement itself was signed by Tactacell in Lafayette, Louisiana. The Court therefore finds that a substantial part of the events giving rise to the breach of contract claim – namely, the contract‘s execution, the expected performance, and the Defendant‘s alleged breach –
III. Transfer to District of Minnesota
Deer Management finally argues that the Court should transfer this matter because Minnesota is a far more convenient forum for the adjudication of this case. A district court may transfer any civil action to any other district where the case might have been brought, if transfer serves “the convenience of parties and witnesses, [and is] in the interest of justice.”
(1) “the relative ease of access to sources of proof;” (2) “the availability of compulsory process to secure the attendance of witnesses;” (3) “the cost of attendance for willing witnesses;” (4) “all other practical problems that make trial of a case easy, expeditious and inexpensive;” (5) “the administrative difficulties flowing from court congestion;” (6) “the local interest in having localized interests decided at home;” (7) “the familiarity of the forum with the law that will govern the case;” and (8) “the avoidance of unnecessary problems of conflict of laws [or in] the application of foreign law.”
In re Radmax, 720 F.3d 285, 288 (5th Cir. 2013) (quoting In re Volkswagen of America, Inc., 545 F.3d 304, 315 (5th Cir. 2008)). Additionally, the plaintiff‘s choice of venue is to be considered. Id. (citing Peteet v. Dow Chemical Co., 868 F.2d 1428, 1436 (5th Cir. 1989)). Exercising its sound discretion, the Court declines to transfer this case to the District of Minnesota. Although Minnesota is likely also a proper venue for this action, the Court finds that this District is not an “inconvenient” forum within the meaning of
At bottom, Defendant has failed in its burden to show that the District of Minnesota is clearly more convenient than this venue. Defense Distributed v. Bruck, 30 F.4th 414, 433 (5th Cir. 2022) (“When the transferee venue is not clearly more convenient than the venue chosen by the Plaintiff, the Plaintiff‘s choice should be respected“). Accordingly, the Court will maintain jurisdiction over this matter.
CONCLUSION
IT IS HEREBY ORDERED that DEER MANAGEMENT SYSTEMS, LLC‘S MOTION TO DISMISS UNDER
THUS, DONE AND SIGNED in Chambers on this 10th day of August 2022.
DAVID C. JOSEPH
UNITED STATES DISTRICT JUDGE