Hamm v. Wyndham Resort Development Corp.

District Court, M.D. Tennessee·Decided October 9, 2020·No. 3:19-cv-00426·Unknown

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE MIDDLE DISTRICT OF TENNESSEE NASHVILLE DIVISION GARY W. HAMM and ) LINDA M. HAMM, ) ) Plaintiffs, ) ) v. ) Case No. 3:19-cv-00426 ) Judge Aleta A. Trauger WYNDHAM RESORT DEVELOPMENT ) CORP., WYNDHAM WORLDWIDE ) OPERATIONS, INC., WYNDHAM ) VACATION RESORTS, INC., ) WYNDHAM VACATION OWNERSHIP, ) INC., WYNDHAM CONSUMER ) FINANCE, INC., WYNDHAM ) REWARDS, INC., and JOHN DOES 1– ) 100, ) ) Defendant. ) MEMORANDUM AND ORDER Before the court is the motion by defendant Wyndham Vacation Resorts, Inc. (“WVR”)1 to dismiss the Amended Complaint under Rules 12(b)(2) and 12(b)(3), for lack of personal jurisdiction and improper venue. (Doc. No. 33.) In the alternative, the defendant moves to transfer venue under 28 U.S.C. § 1406(a)(2). For the reasons set forth herein, the motion will be denied. 1 All of the Wyndham-affiliated defendants named in the original Complaint were dismissed, and the Amended Complaint reinstated certain claims against WVR only. The current motion was purportedly filed by and on behalf of the dismissed defendants in addition to WVR, “[o]ut of an abundance of caution.” (Doc. No. 34, at 1 n.1.) Because WVR is the only Wyndham- affiliated entity against which claims remain pending, the court construes the motion as filed by and on behalf of WVR only. I. STATEMENT OF THE CASE This case, filed more than a year ago, has not progressed far. This opinion presumes familiarity with the court’s previous rulings, and the court will summarize here only those facts and events necessary to an understanding of the current motion. Plaintiffs Linda and Gary Hamm filed suit in May 2019 against WVR, Wyndham Resort

Development Corp., Wyndham Worldwide Operations, Inc., Wyndham Vacation Ownership, Inc., Wyndham Rewards, Inc. (collectively, the “Wyndham defendants”), and “John Does 1–100,” who are alleged to be individuals employed by one or more of the Wyndham defendants.2 The plaintiffs’ claims in the original Complaint were premised upon their purchase of timeshare properties and points for resort properties located in Tennessee and Virginia. Based only on very broad and vague factual allegations, the original Complaint asserted, or purported to assert, causes of action for fraud, fraudulent misrepresentation, fraudulent inducement, misrepresentation by concealment, negligent misrepresentation, violation of the Tennessee Timeshare Act, Tenn. Code Ann. § 66-32-101 et seq., breach of contract, and unjust enrichment. (Doc. No. 1.) Although the original Complaint alleges that the plaintiffs reside in Tennessee and that the defendants’

“continuous and systematic” contacts with the State of Tennessee subjected them to personal jurisdiction in this state (Doc. No. 1 ¶ 19), the Complaint does not specifically identify what those contacts were, other than to assert that the defendants maintained offices and agents for service of process and engaged in “large scale marketing and sales activities” in Tennessee (id. ¶ 23) and to reference the plaintiffs’ purchases of timeshares and signing timeshare contracts in Tennessee and

2 The claims against the John Doe defendants technically remain pending at this time, although the plaintiffs have never served or identified them. The court has entered an order directing the plaintiffs to show cause why these defendants should not be dismissed for failure to effect timely service of process and failure to prosecute. Virginia. It does not identify specific representations made by the defendants or their agents that took place within Tennessee or were directed to the plaintiffs while the plaintiffs were in Tennessee. The Wyndham defendants responded to the Complaint by filing a Motion to Dismiss for

Failure to State a Claim (Doc. No. 6) under Rule 12(b)(6) of the Federal Rules of Civil Procedure, asserting that most of the claims were time-barred and that the pleading did not satisfy Rule 8 or, with respect to the fraud-based claims, Rule 9. The defendants did not argue that the court lacked personal jurisdiction over them, or that venue was improper, with respect to any of the claims. In November 2019, the court granted the Wyndham defendants’ motion to dismiss for failure to state a claim and dismissed all claims without prejudice. However, the court expressly granted the plaintiffs the option of filing a motion to amend their complaint along with a copy of an amended pleading that cured the deficiencies in the original. (Doc. Nos. 15, 16.) The plaintiffs thereafter filed a Motion to Amend and proposed Amended Complaint, which the Wyndham defendants opposed on the grounds of futility. The defendants again argued that all of the claims

in the proposed Amended Complaint were subject to dismissal under Rule 12(b)(6), for failure to state a claim for which relief may be granted. Again, they did not raise a defense based on the court’s lack of personal jurisdiction or improper venue with respect to any of the claims against any of the defendants. The court ultimately entered a Memorandum and Order (Doc. Nos. 27, 28) granting in part and denying in part the plaintiffs’ Motion to Amend. Although the court authorized the filing of the Amended Complaint (Doc. No. 29), which is now the operative pleading, the court substantially narrowed the scope of the claims asserted therein. Specifically, the court found that the only viable claims against any of the Wyndham defendants set forth in the Amended Complaint are those asserted against WVR for negligent and intentional misrepresentation, related to representations allegedly made by agents for WVR to the plaintiffs, in person, while the plaintiffs were in Williamsburg, Virginia in September 2014 and May 2015. WVR has now filed its Motion to Dismiss the Plaintiffs’ Amended Complaint. It asserts

that, with court’s ruling on the plaintiffs’ Motion to Amend, the Amended Complaint contains no allegations of conduct by WVR that occurred within Tennessee, without which this court cannot exercise personal jurisdiction over WVR. The defendants move to dismiss for lack of personal jurisdiction and improper venue or, alternatively, to transfer venue under 28 U.S.C. § 1406(a). (Doc. Nos. 33, 34.) The plaintiffs have filed a Response in Opposition, arguing that WVR is subject to both general and specific jurisdiction in this district. (Doc. No. 45.) II. LEGAL STANDARDS Generally, when a defendant challenges personal jurisdiction under Rule 12(b)(2), “[t]he plaintiff bears the burden of making a prima facie showing of the court’s personal jurisdiction over the defendant.” Intera Corp. v. Henderson, 428 F.3d 605, 615 (6th Cir. 2005). When sitting pursuant to federal question jurisdiction, a court may exercise personal jurisdiction over a

defendant “‘if the defendant is amenable to service of process under the [forum] state’s long-arm statute and if the exercise of personal jurisdiction would not deny the defendant[] due process.’” Bird v. Parsons, 289 F.3d 865, 871 (6th Cir. 2002) (quoting Mich. Coal. of Radioactive Material Users, Inc. v. Griepentrog, 954 F.2d 1174, 1176 (6th Cir. 1992)). It is well established, however, that “Tennessee law extends its jurisdiction to due process’s limits,” Parker v. Winwood, 938 F.3d 833, 839 (6th Cir.

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Hamm v. Wyndham Resort Development Corp., (M.D. Tenn. 2020).

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