Adams v. Dost

Opinion

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF MISSOURI EASTERN DIVISION

LINDA ADAMS, et al., ) ) Plaintiffs, ) ) v. ) Cause No. 4:20-cv-00874 ) TRUSTEE, TERRI DOST, et al., ) ) Defendant. MEM ORAND) UM AND ORDER

Before the Court is Defendants’ Motion to Dismiss. Doc. [9]. The Motion has been briefed and is rea.dy for disposition. Docs. [14], [15]. For the reasons set forth below, the Motion is granted BACKGROUND

On March 13, 2008, Defendants Wyndham Vacation Resorts, Inc. (WVR) and Trustee 1 Fairshare Vacation Owners Association executed the Second Amended and Restated Fairshare Vacation Plan Use Management Trust Agreement (Trust Agreement), Doc. [1] Id. ¶ 324, which was designed to facilitate the management of beneficiaries’ timeshare rights id. and interests in different timeshare properties. ¶¶ 325-28. Under the Trust Agreement, the Trustee was required to “develop . . . a reservation system,” ¶ 328, and to ensure that the Plan Manager maintains reporting information concerning financial transactions and Id inventory related to the properties as well as information documenting beneficiaries’ timeshare interests. . ¶ 329. The Trust, as amended and restated, is organized and exists under Arkansas law. Docs. [1] ¶ 322, [10] at 2. The Trustee is an Arkansas not-for-profit corporation with its principal place of business in Florida, Docs. [1] ¶ 332, [10] ¶ 1, and was id authorized to delegate any of its responsibilities to the Plan Manager. Doc. [1] ¶ 330. Id WVR, as the Plan Manager, . at ¶¶ 331, 334, received its duties from a Management Agreement. . at ¶ 332. Those duties included: (i) administering Trust property, 1 In their Complaint, Plaintiffs identify Terri Dost as Trustee. Doc. [1] ¶ 322. But Defendants clarify (ii) establishing and operating the Reservation System noted in the Trust Agreement, (iii) preparing and submitting a budget to the Trustee, (iv) accounting for the expenditures of Id each Member during the past fiscal year, and (v) maintaining a record of the Members and Id the cumulative number of Points of the Trust property. . ¶¶ 336-40. Also at issue are the Management Agreement’s cost allocation and compensation provisions. . ¶¶ 341- 42. WVR is a Delaware corporation with its principal place of business in Florida. Docs [1] ¶323, [10- 1] ¶ 5. Plaintiffs, an ensemble of individuals residing throughout the United States, hold Id timeshare interests in various properties within the Trust. Doc. [1] ¶¶ 1-321. On July 1, 2020, they filed suit against WVR and Trustee for breaches of the Trust Agreement. . ¶¶ 1- 321, 351-89. Specifically, Plaintiffs brought actions for (i) accounting, (ii) failure to operate Id the reservation system, and (iii) failure to operate the properties within reasonable cost and profit margins at prevailing market rates. . ¶¶ 351-89. On March 11, 2021, WVR and Trustee filed their Rule 12(b)(2) Motion to Dismiss and Memorandum in Support. Docs. [9], [10]. WVR and Trustee do not contest personal jurisdiction over Defendants with respect to claims brought by Plaintiffs who either reside in Missouri or purchased their operative agreements from WVR in Missouri (“Group 1”). Doc. [10] at 2. They do argue, however, that the Court lacks jurisdiction over Defendants Id with respect to claims brought by Plaintiffs who entered contracts with WVR but have no connection to WVR or the Trust arising from contacts with Missouri (“Group 2”). . ¶ 4. They also contest the Court’s jurisdiction over claims brought by Plaintiffs who purchased their ownership interests from Wyndham Resort Development Corporation and/or Id WorldMark The Club (WorldMark) but have no connection to WVR, the Trust, or WorldMark arising out of contacts between DefendLaEGnAtsL aSnTdA NMDiAsRsDouri (“Group 3”). . ¶ 5.

Defendants may move to dismiss for lack of personal jurisdiction. Fed. R. Civ. P. 12(b)(2). To forestall dismissal, “a plaintiff must make a prima facie showing that personal K-V Pharm. Co. jurisdiction exists, which is accomplished by pleading sufficient facts to support a reasonable v. J Uriach & CIA, S.A. inference that the defendant can be subject to jurisdiction within the state.” Dever v. Hentzen Coatings, Inc. , 648 F.3d 588, 591-92 (8th Cir. 2011) (internal quotation marks allegations in the Complaint must be taken as true to the extent they are uncontroverted by defendant’s affidavits. If the parties present conflicting affidavits, all factual disputes are Cantrell v. Extradition resolved in the plaintiff’s favor, and the plaintiff’s prima facie showing is sufficient Corp. of Am. Wyatt v. Kaplan notwithstanding the contrary presentation by the moving party.” Behagen v. Amateur Basketball Ass’n of U.S.A. , 789 F. Supp. 306, 308-09 (W.D. Mo. 1992) (citing , 686 F.2d 276, see also Dever 280 (5th Cir. 1982); , 744 F.2d 731, 733 (10th Johnson v. Arden Cir. 1984); , 380 F.3d at 1076. Although “[t]he evidentiary showing required Willnerd v. First Nat’l Neb., Inc. at the prima facie stage is minimal,” , 614 F.3d 785, 794 (8th Cir. 2010) (internal quotation marks omitted) (quoting , 558 F.3d 770, Dever 778 (8th Cir. 2009)), it “must be tested, not by the pleadings alone, but by the affidavits and Block Indus. V. DHJ Indus., Inc. exhibits” supporting or opposing the motion to dismiss. , 380 F.3d at 1072 (internal quotation marks omitted) (quoting , 495 F.2d 256, 260 (8th Cir. 1974)). DISCUSSION I. Personal Jurisdiction Bristol-Myers Squibb Co. v. Superior Ct. of Cal., San Francisco Cnty. There are two bases of personal jurisdiction: “general” and “specific.” Goodyear Dunlop Tires Operations, S.A. v. Brown , 137 S. Ct. 1773, 1779-80 (2017) (citing , 564 U.S. 915, 919 (2011)). Because Plaintiffs allege that both exist here, Doc. [1] ¶ 349, the Court addresses both. As set forth below, Plaintiffs have not made a prima facie showing of personal jurisdiction over Defendants with respecta t.o cGleainmesr ablr Pouegrshot nbayl P Jluarinistdififcs tiino Gn roups 2 and 3. any Bristol-Myers Squibb “A court with general jurisdiction may hear claim against that defendant, even if Goodyear all the incidents underlying the claim occurred in a different state.” , 137 S. Ct. at 1780 (quoting , 564 U.S. at 919) (emphasis in original) (internal quotation Gilmor v. Preferred Credit Corp. marks omitted). General jurisdiction applies regardless of whether the state long-arm statute applies. , 2011 WL 111238, at *2 (W.D. Mo Jan. 13, Bristol-Myers Squibb 2011). For natural persons, the paradigmatic forum for exercising general personal Goodyear jurisdiction is the individual’s domicile. , 137 S. Ct. at 1780 (quoting Id Goodyear , 564 U.S. at 919). “[F]or a corporation, it is an equivalent place, one in which the Daimler AG v. Bauman Goodyear corporation is generally “at home” in its place of incorporation and its principal place of business, , 571 U.S. 117, 137 (2014) (citing , 564 U.S. at 924), Id Goodyear as well as wherever its “affiliations with the State are so ‘continuous and systematic’ as to render [it] essentially at home in the forum State.” . at 139 (quoting , 564 U.S. at Bristol-Myers Squibb 919). “But ‘only a limited set of affiliations with a forum will render a defendant amenable Daimler to’ general jurisdiction in that State.” , 137 S. Ct. at 1780 (quoting , 571 U.S. at 137). Plaintiffs acknowledge that no Defendant is incorporated or maintains its principal place of business in Missouri. Doc. [1] ¶ 349. WVR is not incorporated in Missouri and does not maintain its principal place of business in Missouri. Doc. [1] ¶ 232. The Trustee is an Schubel v. Arkansas non-profit corporation with its principal place of business in Florida. Doc. [10-1] Lampland Hicklin Eng’g, L.C. v. ¶ 6. And the Trust is organized and existing under Arkansas law. Doc. [1] ¶ 322; Bartell , 2013 WL 5787881, at *1 (D. Minn. Oct. 28, 2013) (citing , 439 F.3d 346, 348 (7th Cir. 2006) (“most courts to address the issue have held that the citizenship of [a] trust is the citizenship of the trustee or trustees”). Therefore, general Daimler personal jurisdiction exists only if Plaintiffs show that Defendants’ contacts with Missouri Goodyear are so “continuous and systematic” that they can be said to be “at home” here. , 571 U.S. at 139 (quoting , 564 U.S. at 919). Plaintiffs fail to make that showing. Plaintiffs support their claim of general jurisdiction by directing the Court’s attention to six Missouri properties included in the Trust managed by the Trustee and WVR. Doc. [14] at 3-4. According the timeshare agreements included in Defendants’ exhibits, those Missouri properties comprise only a small proportion of all the real properties in the Trust. Doc. [10- Daimler 1] at 7-384. Such contacts demonstrate only that Defendants are “doing business” in Missouri. , 571 U.S. at 762 n.20 (“A corporation that operates in many places can scarcely be deemed at home in all of them. Otherwise, ‘at home,’ would be synonymous with ‘doing business’ tests framed before specific jurisdiction evolved in the United States.”). They do not demonstrate that the Defendants are “at home” in Missouri for purposes of generalb p. erSspoencailf ijcu rPiesdrsicotnioanl. Jurisdiction Specific jurisdiction is very different from general jurisdiction. “A federal court in a Oriental Trading Co., Inc. v. Firetti Morris v. permitted by the long-arm statute of the forum state and by the Due Process Clause.” Barkbuster, Inc. , 236 F.3d 938, 943 (8th Cir. 2001) (quoting See, e.g. Dairy Farmers of Am. v. , 923 F.2d 1277, 1280 (8th Cir. 1991)). The Missouri long-arm statute Bassett & Walker Intern., Inc. authorizes jurisdiction only under specific circumstances. , , 702 F.3d 472, 475 (8th Cir. 2012) (“While the long-arm statute extends jurisdiction to the limits of the Due Process Clause, it does so only for acts within its enumerated categories.”). Further analysis of the scope of the statute is unnecessary, however, because Defendants’ contacts with Missouri are insufficient to satisfy Due Process. Defendants present evidence that the claims brought by Group 2 and 3 Plaintiffs do not arise out of Defendants’ contacts with Missouri. Doc. [10-1] at 2. Defendants filed the Declaration of James Ward, the Director of Title Services, Consumer Finance for Wyndham id. Destinations, Inc., wherein Ward identifies the Group 2 and 3 Plaintiffs and their places of Id residence at the time they entered their timeshare contracts. Doc. [10-1] ¶ 3; at 4-6. None is listed as residing in Missouri at the time of contract formation. . Defendants also append Plaintiffs’ timeshare purchase agreements. Doc. [10-1] at 7-384. Again, no agreement Id indicates that any Group 2 or 3 Plaintiff purchased a timeshare interest in either a Missouri property or a collection of properties that includes a Missouri property. . In response, Plaintiffs note that six Trust properties are located in Missouri, and that the Trust Agreement obligates Defendants to “accept and hold ownership of the Trust Properties for the beneficial Bristol-Myers use of each Member.” Doc. [14] at 4-5. The Court finds instructive. In that case, California domiciliaries and Bristol-Myers Squibb nonresidents sued Bristol-Myers Squibb, LLC, for injuries suffered from ingesting Plavix. , 137 S. Ct. at 1778. The Court held that Bristol-Myers Squibb’s contacts with California were insufficient to support specific personal jurisdiction with respect to nonresident plaintiffs’ claims, noting that the nonresident plaintiffs “were not prescribed Id Plavix in California, did not purchase Plavix in California, did not ingest Plavix in California, and were not injured by Plavix in California.” . at 1781. Similarly, Plaintiffs in this case present no evidence that Group 2 and 3 Plaintiffs entered their contracts in Missouri, negotiated the purchase of their timeshare interests in Missouri, engaged in negotiations related to Missouri properties, purchased timeshare Missouri property. If Plaintiffs in Group 2 and 3 suffered injuries, those injuries arose out of contracts negotiated and entered into outside Missouri, in relation to non-Missouri Bristol-Myers Squibb other properties. To exercise jurisdiction over Defendants with respect to their claims would therefore run afoul of ’s admonition: “[T]he mere fact that plaintiffs were prescribed, obtained, and ingested Plavix in California—and allegedly Id sustained the same injuries as did the nonresidents—does not allow the State to assert specific jurisdiction over the nonresidents’ claims.” . (emphasis in original). Because Plaintiffs present no evidence connecting the Group 2 and 3 Plaintiffs’ claims to Defendants’ contacts with Missouri, they have not made a prima facie showing of specific personal jIuI.r isdicTtiroann. sfer under 28 U.S.C. § 1404 Plaintiffs ask the Court to transfer the suit under 28 U.S.C. § 1404 to a Florida venue Blume if it determines that no jurisdiction exists over the claims of Groups 2 and 3. Doc. [14] at 5. v. Int’l Serv., Inc. This Court may transfer a case despite lack of personal jurisdiction over a defendant, , 2012 WL 1957419, at *3 (E.D. Mo. May 31, 2012), but it declines to do so Terra here. Int’l., Inc. v. Miss. Chem. Corp. Stewart Org., Inc. v. While district courts have broad discretion when deciding a motion to transfer, Ricoh Corp. , 119 F.3d 688, 691 (8th Cir. 1997) (citing , 487 U.S. 22, 29 (1988)), they should exercise that discretion only after weighing Terra Int’l three factors: “(1) the convenience of the parties, (2) the convenience of the witnesses, and (3) the interest of justice.” , 119 F.3d at 691 (citing 28 U.S.C. § 1404(a) (1994)). With respect to “convenience,” courts generally consider, “(1) the convenience of the parties, (2) the convenience of the witnesses . . . , (3) the accessibility to records and documents, (4) Id the location where the conduct complained of occurred, and (5) the applicability of each forum state’s substantive law.” . at 696. Under the “interest of justice” heading, courts inquire into “(1) judicial economy, (2) the plaintiff’s choice of forum, (3) the comparative costs to the parties of litigating in each forum, (4) each party’s ability to enforce a judgment, Id Terra Intern., Inc. v. Miss. Chem. Corp. (5) obstacles to a fair trial, (6) conflict of law issues, and (7) the advantages of having a local court determine questions of local law.” . (citing , 922 F. Supp. 1334, 1357-61 (N.D. Iowa April 5, 1996)). Transfer analysis requires a court to give relevant factors.” Id.; see also In re Apple, Inc., 602 F.3d 909, 912 (8th Cir. 2010). Generally, the plaintiff's choice of forum receives a favorable presumption, and the burden is on the party seeking transfer “to show that the balance of factors ‘strongly’ favors the movant.” Graff v. Qwest Commc'ns Corp., 33 F.Supp. 2d 1117, 1121 (D. Minn. 1999) (citing Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508 (1947), superseded by statute, 28 U.S.C. § 1404(a) (1994), as recognized in Am. Dredging Co. v. Miller, 510 U.S. 443 (1994)). Plaintiffs here make a passing request for transfer in their Response, without even identifying the applicable factors, much less applying them. Doc. [14] at 5. Moreover, Plaintiffs ask the Court to disregard their initial forum selection, a selection that should receive a favorable presumption. Graff, 33 F. Supp. 2d at 1121; see also Cohen v. Waxman, 421 F. App’x 801, 803 (10th Cir. 2010) (‘“Tronically, in this case it is the plaintiff who desires a transfer from the forum he originally selected. Only now that he knows that he will lose in that forum does he seek another. But the law rarely favors two bites at the apple.”). Because Plaintiffs make no showing that “the balance of factors strongly favors” transfer, the Court denies the transfer request. Graff, 33 F. Supp. 2d at 1121. Accordingly, IT IS HEREBY ORDERED that Defendants’ Rule 12(b)(2) Motion, Doc. [9], is GRANTED. Claims of Plaintiffs in Groups 2 and 3 as listed in Defendants’ Memorandum in Support, Doc. [10], are DISMISSED for lack of personal jurisdiction. Claims brought by Plaintiffs in Group 1 are unaffected by this Order and may proceed. IT IS FURTHER ORDERED that Plaintiffs’ transfer request, Doc. [14] at 5, is DENIED.

Dated this 14 day of December, 2021.

het Liteg. SARAH E. PITLYK UNITED STATES DISTRICT JUDGE