ORDER
This matter is before the Court on Defendants Leslie Nachman and Gordon Mel-cher’s Motion to Dismiss for Lack of Personal Jurisdiction and Improper Venue (Doc. No. 4), Plaintiffs Opposition (Doc. No. 10), and Defendants’ Reply (Doc. No. 14).
For reasons set forth below, the motion is DENIED.
Defendants Leslie Nachman and Gordon Melcher move to dismiss themselves from this suit on the grounds that the Complaint fails to state a proper ground for personal jurisdiction, this Court lacks personal jurisdiction over them, and this Court is an improper venue.
Plaintiff Morton Walker, a podiatrist, author and citizen of Connecticut, initiated this action in April of 1999 alleging copyright infringement, plagiarism, fraud and conspiracy. Mr. Walker’s contentions are that Defendants authored, published and distributed a report entitled “Olive Leaf Extract: Nature’s Secret for Vibrant Health and Long Life,” which plagiarized and infringed his book, “Nature’s Antibiotic: Olive Leaf Extract.” Mr. Walker had originally endeavored to write the book pursuant to a contract with East Park Research, Inc. (“EPRI”) whereby he agreed to refer to an EPRI nutritional supplement called “Eden Extract.” The contract was terminated after EPRI reviewed the labeling rules of the United States Food and Drug Administration. Returning his advancement, Mr. Walker published the book anyway and EPRI followed with publication of the accused report.
Messrs. Nachman and Melcher are, respectively, Vice-President and President of EPRI, which is alleged to have produced and published the report. Defendants East Park Distributing and David Nicol are located in Canton, Ohio and are alleged to have distributed the report. Defendant Robert Concoby, also of Canton, is alleged to have authored the report. According to affidavits submitted with their motion, Messrs. Nachman and Mel-cher, who are domiciled in Nevada, traveled to Ohio to negotiate with David Nicol and Robert Concoby. Other than this negotiation, Messrs. Nachman and Melcher claim to have had no other occasion to visit Ohio. They further claim that they have never individually conducted business in Ohio and do not maintain agents in Ohio. Plaintiff does not dispute these claims.
II.
Defendants’ main argument in favor of dismissal is that this Court lacks personal jurisdiction over them. The plaintiff bears the burden of establishing personal jurisdiction.
Weller v. Cromwell Oil Co.
To gain personal jurisdiction over a defendant in a diversity action, plaintiff must make two-pronged showing that (1) the defendant is amenable to suit under the forum state’s long-arm statute; and (2) due process requirements of the Constitution are met.
CompuServe, Inc. v. Patterson
Ohio’s long-arm statute permits jurisdiction over any corporation or person “(1) transacting any business in this state; (2) contracting to supply services or goods in this state; ... (3) Causing tortious injury
As an initial matter, it is necessary to resolve the issue of whether Ohio’s long-arm statute extends as far as notions of federal due process allow. If so, the two-pronged analysis of personal jurisdiction collapses into one and there is no need to examine Ohio’s long-arm statute separately from the constraints of due process.
Aristech Chem. Int’l Ltd. v. Acrylic Fabricators Ltd.,
In
Goldstein v. Christiansen
On the strength of
Goldstein,
the court in
Highway Auto Sales, Inc. v. Auto-Konig of Scottsdale, Inc.
This Court agrees with
Highway Auto Sales
—the analysis of the scope of Ohio’s long-arm statute “requires more than mere passing reference.”
The conclusion seems inescapable, then, that Ohio’s long-arm statute is not coextensive with federal due process.
See e.g. Heritage Funding and Leasing v. Phee
III.
Under Ohio’s long-arm statute, the exercise of jurisdiction over Messrs. Nachman and Melcher is appropriate. The “transacting business” clause in Ohio’s long-arm statute is broader than the word ‘contract’ and encompasses ‘carrying on’ business and ‘having dealings’ within the state.
Kentucky Oaks Mall Co. v. Mitchell’s Formal Wear, Inc.
Further, the fact that Defendants were physically present in Ohio during these negotiations weighs strongly in favor of personal jurisdiction, especially since Ohio’s long-arm statute does not necessarily require physical presence in the state.
Hammill Mfg. Co. v. Quality Rubber Products, Inc.
In addition, the fact that the distribution and authorship agreements created ongoing duties and obligations between the non-resident and resident defendants weighs in favor of personal jurisdiction,
Kentucky Oaks Mall Co.
IV.
However, Messrs. Nachman and Melcher argue that the “fiduciary shield doctrine” prevents the assertion of personal jurisdiction over them because in all dealings relevant to the present litigation, they acted in their corporate rather than individual capacity. The fiduciary shield doctrine holds that “if an individual has contact with a particular state only by virtue of his acts as a fiduciary of the corporation, he may be shielded from the exercise, by that state, of jurisdiction over him personally on the basis of that conduct.”
Marine Midland Bank, N.A. v. Miller
If applied in its strongest form, the fiduciary shield doctrine would prevent the
Only one other Ohio case pertains to the fiduciary shield doctrine-Galloway v. Lorimar Motion Picture Mgmt., Inc.
\Although these cases seem to conflict, there is a key difference in that
Heritage Funding
involved an individual defendant who had made statements and taken actions while he was in Ohio, and who was personally involved in transactions that gave rise to the complaint.
Hence, while Ohio courts recognize the fiduciary shield doctrine, they would not apply it in the instant case where Defendants, unlike the defendants in
Galloway,
personally involved themselves in a transaction giving rise to the cause of action, and were physically present in the state.
Heritage Funding & Leasing Co. v. Phee
V.
Since Ohio law would permit this Court to exercise personal jurisdiction, the next step is to decide whether such an exercise accords with due process. To comport with due process, an exercise of personal jurisdiction requires that a defendant “have certain minimum contacts such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’ ”
International Shoe Co. v. Washington
Defendants do not have the kind of “continuous and systematic” contacts required to establish general jurisdiction.
Aristech Chem. Int’l Ltd. v. Acrylic Fabricators Ltd.
Specific jurisdiction, on the other hand, exists if defendants have sufficient minimum contacts with the forum state and the action arises out of those contacts.
Id.
The Sixth Circuit has instituted a three-part test for the exercise of specific jurisdiction: “First, defendant must pur
Ignoring for the moment the questions raised by the fiduciary shield doctrine, it is apparent that the defendants would be subject to personal jurisdiction under the
Mohasco
test set forth above. Messrs. Nachman and Melcher did not merely solicit a business deal over the phone or through distant methods of communication that were aimed at a general population.
Reynolds v. Int’l Amateur Athletic Fed’n
Hence, the non-resident Defendants’ relationship to an Ohio author and distributor was not a “one-shot affair” but an ongoing relationship that supports personal jurisdiction.
CompuServe, Inc. v. Patterson
VI.
In light of the above determination, disposition of Defendants’ motion hinges on whether the fiduciary shield doctrine, as applied in the context of the due process analysis, will ward off the exercise of personal jurisdiction. Defendants argue that at all times relevant to Plaintiffs complaint, they were “acting solely in the course and scope of their duties as officers of ÉPRI.” Citing Weller v. Cromwell Oil Co. for the proposition that personal jurisdiction over a corporate officer cannot be based solely on the propriety of the district court’s exercise of jurisdiction over the corporation, Defendants argue that they are insulated from personal jurisdiction by the fact that they never acted in anything but their corporate capacity.
Although some district courts in Ohio have relied on
Weller
in finding that personal jurisdiction is precluded where a non-resident corporate officer commits a tort in his official capacity,
3
the better view is found in
State of Ohio ex rel. Celebrezze v. Browning-Ferris Industries, Inc.
As the
Browning-Ferris
court points out, the Sixth Circuit in
Weller
noted that the defendant corporate officers were never in the state of Ohio.
Id.
at *2;
Weller,
In
Chattanooga Corp. v. Klingler
In Nerras
v. First Tennessee Bank, N.A.,
Hence, in the Sixth Circuit the mere fact that the actions connecting defendants to the forum state were undertaken in an official rather than personal capacity does not preclude the exercise of personal jurisdiction over those defendants. This conclusion is bolstered by the fact that
International Shoe
and its progeny have never made a distinction as to the role in which a defendant performed his tortious act — -whether for his personal benefit, for the benefit of an employer, or a third party.
See Columbia Briargate Co. v. First Nat’l Bank in Dallas
Hence, the exercise of personal jurisdiction over Messrs. Nachman and Melcher in this case comports with traditional notions of fairness and substantial justice, despite the fact that they acted in their corporate capacity when they visited Ohio to negotiate the authorship and distribution of the accused report. When a corporate agent comes into a state and commits a tort, it is not unfair to require him to defend a suit in that state.
Columbia Briargate Co. v. First Nat’l Bank in Dallas
A contrary result would be anomalous. In
Marine, Midland Bank v. Miller,
the case which is usually taken to be the best exposition of the fiduciary shield doctrine, the Second Circuit admitted that the doctrine creates a “dichotomy” between “the principles governing the personal liability of corporate agents for torts committed in their corporate roles and the principles governing the amenability of such agent to personal jurisdiction solely on the basis of those acts.”
By traveling personally to Ohio to negotiate an agreement that gave rise to the cause of action in the present case, Messrs. Nachman and Melcher should have expected that they could be haled into court in Ohio for any tortious behavior engaged in there. The exercise of personal jurisdiction over them does not offend due process.
VII.
Besides invoking the fiduciary shield doctrine, Defendants raise two other arguments to support their motion to dismiss. Neither argument suffices.
The first is that Plaintiff, in violation of Federal Rule of Civil Procedure 8(a)(1), failed to in his complaint to state the basis for the Court’s jurisdiction over Messrs. Nachman and Melcher. Federal Rule of Civil Procedure 8(a)(1) requires a “short and plain statement of the grounds upon which the court’s jurisdiction depends.” Courts interpret this rule to refer to subject-matter jurisdiction and not personal jurisdiction,
Dirks v. Carnival Cruise Lines
Defendants also argue that venue is improper as to them, and that the applicable venue provision is that of the Copyright Act, 28 U.S.C. § 1400(a), rather than 28 U.S.C. 1332, which governs diversity actions. Even if Defendants are correct that 28 U.S.C. § 1400(a) is the applicable venue provision, they are wrong that venue is improper as to them. Among other reasons, venue is proper because Messrs. Nachman and Melcher are subject to personal jurisdiction in this district.
Store Decor Div. Of Jas Intern., Inc. v. Stylex Worldwide Indus., Ltd.
VIII.
For the reasons set forth above, Defendants’ motion to dismiss is DENIED.
IT IS SO ORDERED.
Notes
. The fact that Plaintiff may also have a basis for subject matter jurisdiction in the federal question raised by his copyright infringement claim does not change the personal jurisdiction analysis since 17 U.S.C. 501
et seq.
does not provide for nationwide service of process.
Onderik v. Morgan
.
Iron Workers Local Union No. 17 Ins. Fund v. Philip Morris, Inc. 23
F.Supp.2d 796, 806 (N.D.Ohio 1998);
Akro Corp. v. Luker
.
United States
v.
Flack
