Hongyu Luo v. Tao Ceramics Corp.

32 Mass. L. Rptr. 134
CourtMassachusetts Superior Court
DecidedApril 10, 2014
DocketNo. MICV201305280F
StatusPublished

This text of 32 Mass. L. Rptr. 134 (Hongyu Luo v. Tao Ceramics Corp.) is published on Counsel Stack Legal Research, covering Massachusetts Superior Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Hongyu Luo v. Tao Ceramics Corp., 32 Mass. L. Rptr. 134 (Mass. Ct. App. 2014).

Opinion

Curran, Dennis J., J.

The defendant Qian Qiao has moved to dismiss all claims for lack of personal jurisdiction under Mass.R.Civ.P. 12(b)(2).

For the reasons that follow, the defendant’s motion must be DENIED.

In determining whether the plaintiff Hongyu Luo has made a prima facie jurisdictional showing, the court draws factual allegations in the pleadings as true, and construes disputed facts in the light most favorable to the non-moving party (here, the plaintiff).

Factual Background

The record reveals the following facts.

Hongyu Luo alleges that Qian Qiao contacted him in Massachusetts about setting up a business in the United States in May 2010. According to Mr. Luo, Ms. Qiao met with him in Waltham, Massachusetts in July 2010 to discuss details relating to the proposed business, Tao Ceramics, which was to be incorporated in Texas.1 In September 2010, Mr. Luo received a letter of employment from Tao Ceramics’s President, Hongjun Ren. Mr. Luo signed this letter and sent a copy to Ms. Qiao.

Mr. Luo’s role in the new company was to seek out “sales opportunities” as well as provide “technical services” from his office in Lexington, Massachusetts. Mr. Luo alleges that Ms. Qiao oversaw his sales efforts in her capacity as Treasurer and Chief Executive Officer of Tao Ceramics. Mr. Luo also alleges that he reported to Ms. Qiao on a weekly basis regarding new and existing sales that he had secured for the company. Mr. Luo was terminated in January 2012. Ms. Qiao left Tao Ceramics in December 2012. Mr. Luo subsequently filed a complaint in Massachusetts alleging a failure to pay wages due under his letter of employment, in which he named Ms. Qiao as a defendant. Ms. Qiao has moved to dismiss the claim against her for lack of personal jurisdiction.

DISCUSSION

A Massachusetts court may exercise personal jurisdiction over a non-resident defendant only if the jurisdiction is authorized by the Massachusetts Longarm statute, G.L.c. 223A, §3, and its exercise would not offend the due process clause of the 14th Amendment. Ticketmaster-New York, Inc. v. Alioto, 26 F.3d 201, 204 (1st Cir. 1994). As an initial matter, Ms. Qiao seems to assert that exercising jurisdiction over her personally would be improper since she was merely acting in the scope of her employment as Chief Executive Officer of Tao Ceramics. It is true that jurisdiction over a corporation “does not automatically secure jurisdiction over its officers.” Morris v. Unum Life Ins. Co. of Am., 66 Mass.App.Ct. 716, 720 (2006). Massachusetts courts, however, do not recognize the so-called “fiduciary shield doctrine” as a limitation on exercise of personal jurisdiction over corporate officers. See Farazi v. Caffey, 2007 WL 1630973 at n. 4 (Mass.Super. May 2, 2007) [22 Mass. L. Rptr. 497]. Instead, courts have held that the exercise of personal jurisdiction over a corporate officer acting in the scope of his/her employment is proper when the conduct giving rise to the litigation is entrepreneurial or managerial in nature. Kleinerman v. Morse, 26 Mass.App.Ct. 819, 824 (1989). The conduct of Ms. Qiao was both managerial and entrepreneurial in nature. Ms. Qiao first contacted Mr. Luo and traveled to Massachusetts in the course of starting a business. Afterwards, Ms. Qiao followed-up with Mr. Luo and oversaw his work in Massachusetts in her capacity as Chief Executive Officer, the highest managerial position within a corporation. Accordingly, the inquiry into whether Ms. Qiao’s contacts with Massachusetts supports the exercise of personal jurisdiction in this case must include her conduct as Chief Executive Officer of Tao Ceramics. See Johnson Creative Arts, Inc. v. Wool Masters, Inc., 573 F.Sup. 1106, 1111 (D.Mass. 1983) (court considered conduct of president in planning incorporation, soliciting business, and receiving tele[135]*135phone orders from Massachusetts retailers in jurisdictional analysis).

A. The Massachusetts Longarm Statute Authorizes Personal Jurisdiction over the Defendant.

The Massachusetts Longarm statute authorizes courts to exercise jurisdiction over non-resident defendants when the defendants have “transact[ed] any business in this commonwealth,” the course of which gave rise to the litigation. G.L.c. 223A, §3{a). The “transacting any business” clause has been construed “broadly.” Tatro, 416 Mass. at 767; quoting Heins v. Wilhelm Loh Wetzlar Optical Mach. GmbH & Co. KG., 26 Mass.App.Ct. 14, 17 (1988). Although an isolated or Incidental transaction with a Massachusetts resident may be insufficient, purposeful and continuous contacts with a Massachusetts resident in the course of business will satisfy the Longarm statute. See Tatro, 416 Mass. at 767. In Tatro, the Supreme Judicial Court found that a California hotel, which had contacted ten Massachusetts companies seeking convention business and then maintained contact with them by telephone and mail, had transacted business within the meaning of the Longarm statute. Id.

Ms. Qiao’s contacts with Mr. Luo in Massachusetts were similarly purposeful, repetitive, and long-running. See Diamond Grp. v. Selective Distribution Int’l, 84 Mass.App.Ct. 545, 550 (2013). Over the course of 15 months, Ms. Qiao allegedly contacted Mr. Luo on a weekly basis regarding his progress on securing sales for Tao Ceramics. If believed, this allegation alone is enough to satisfy the “transacted] any business” requirement of the Massachusetts Longarm statute authorizing jurisdiction over Ms. Qian. In Sonesta Intl. Hotels v. Central Fla. Invs., 47 Mass.App.Ct. 154 (1999), the court found that the defendant’s conduct satisfied the Longarm statute where “there were numerous telephone and written communications sent from the defendant in Florida to the plaintiff in Massachusetts over the course of time.” Id. at 161. The conduct of Ms. Qiao clearly falls within the liberal interpretation courts have given to “transacting any business” requirement of the Longarm statute. Accordingly, this court may proceed to the Constitutional phase of the jurisdictional analysis.

B. The Due Process Clause Allows Jurisdiction over the Defendant.

A court may exercise jurisdiction over a non-resident defendant only if the exercise of jurisdiction is consistent with the due process clause of the 14th Amendment such that “the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Int’l Shoe Co. v. State of Wash. Office of Unemployment Comp. & Placement, 326 U.S. 310, 316 (1945). The United States Supreme Court has held that due process therefore requires certain “minimum contacts” between the defendant and the forum state. See id. The First Circuit Court of Appeals employs a three-part test to determine whether the constitutionally-required “minimum contacts” exist between a defendant and the forum state: (1) the claims must directly relate to the defendant’s in-state activities; (2) the defendant’s in-state contacts must represent a purposeful availment of the privilege of conducting activities in the forum state; and (3) the exercise of jurisdiction must be reasonable in light of the Gestalt factors. Abiomed, Inc. v. Turnbull, 379 F.Sup.2d 90, 94 (D.Mass. 2005).

i.Relatedness

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International Shoe Co. v. Washington
326 U.S. 310 (Supreme Court, 1945)
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465 U.S. 783 (Supreme Court, 1984)
Burger King Corp. v. Rudzewicz
471 U.S. 462 (Supreme Court, 1985)
Ticketmaster-New York, Inc. v. Joseph M. Alioto
26 F.3d 201 (First Circuit, 1994)
Arthur F. Sawtelle, Etc. v. George E. Farrell
70 F.3d 1381 (First Circuit, 1995)
Kleinerman v. Morse
533 N.E.2d 221 (Massachusetts Appeals Court, 1989)
Good Hope Industries, Inc. v. Ryder Scott Co.
389 N.E.2d 76 (Massachusetts Supreme Judicial Court, 1979)
Heins v. Wilhelm Loh Wetzlar Optical Machinery GmbH & Co. KG.
522 N.E.2d 989 (Massachusetts Appeals Court, 1988)
Sonesta International Hotels Corp. v. Central Florida Investments, Inc.
712 N.E.2d 607 (Massachusetts Appeals Court, 1999)
Morris v. UNUM Life Insurance Co. of America
850 N.E.2d 597 (Massachusetts Appeals Court, 2006)
Diamond Group, Inc. v. Selective Distribution International, Inc.
998 N.E.2d 1018 (Massachusetts Appeals Court, 2013)
Estabrook v. Wetmore
529 A.2d 956 (Supreme Court of New Hampshire, 1987)
Farazi v. Caffey
22 Mass. L. Rptr. 497 (Massachusetts Superior Court, 2007)

Cite This Page — Counsel Stack

Bluebook (online)
32 Mass. L. Rptr. 134, Counsel Stack Legal Research, https://law.counselstack.com/opinion/hongyu-luo-v-tao-ceramics-corp-masssuperct-2014.