JOSEPH E. ABDO v. KHALIL ABDO

CourtDistrict Court of Appeal of Florida
DecidedDecember 21, 2018
Docket18-0134
StatusPublished

This text of JOSEPH E. ABDO v. KHALIL ABDO (JOSEPH E. ABDO v. KHALIL ABDO) is published on Counsel Stack Legal Research, covering District Court of Appeal of Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
JOSEPH E. ABDO v. KHALIL ABDO, (Fla. Ct. App. 2018).

Opinion

NOT FINAL UNTIL TIME EXPIRES TO FILE REHEARING MOTION AND, IF FILED, DETERMINED

IN THE DISTRICT COURT OF APPEAL OF FLORIDA SECOND DISTRICT

JOSEPH E. ABDO, in his capacity as ) an individual and managing member of ) SOCIAL MEDIA LTD. LLC; JOSEPH M. ) ABDO, in his capacity as an individual ) and member of SOCIAL MEDIA LTD. ) LLC; ASHLEY ABDO; SOCIAL MEDIA ) LTD. LLC, a Nevada Limited Liability ) Corporation; SOCIAL MEDIA, INC. ) LTD; and SOCIAL MEDIA, INC., ) ) Appellants, ) ) v. ) Case No. 2D18-134 ) KHALIL ABDO, in his capacity as an ) individual and shareholder of SOCIAL ) MEDIA, INC., a Florida corporation; ) NADA ABDO QUILL; and MARIE ABDO ) SILVA, ) ) Appellees. ) ___________________________________)

Opinion filed December 21, 2018.

Appeal pursuant to Fla. R. App. P. 9.130 from the Circuit Court for Hillsborough County; Steven Scott Stephens, Judge.

Kraig S. Weiss and Paul K. Silverberg of Silverberg & Weiss, P.A., Weston; and Robert E. Biasotti of Biasotti Law, St. Petersburg, for Appellants.

Craig L. Berman of Berman Law Firm, P.A., St. Petersburg, for Appellees. KHOUZAM, Judge.

In this nonfinal appeal, two nonresident entities, Social Media Ltd LLC

(SMLL) and Social Media Inc. Ltd. (SMIL), challenge the trial court's order denying their

motion to quash service and/or dismiss the second amended complaint based on a lack

of personal jurisdiction. Because the second amended complaint fails to allege

sufficient jurisdictional facts to establish Florida's personal jurisdiction over SMLL and

SMIL, we reverse.

Factual Background

This case arose over a dispute regarding the ownership of several "adult-

oriented" websites and the merchant account associated with those websites. In an

attempt to regain some control over the websites and the income derived therefrom,

Khalil Abdo, in his capacity as an individual and shareholder of Social Media, Inc. (SMI),

and two other interested parties (collectively, the Appellees/Plaintiffs) filed a second

amended complaint against their brother and SMI shareholder, Joseph E. Abdo (JEA),

SMLL, SMIL, and others (collectively, the Appellants/Defendants).1 The

Appellees/Plaintiffs sought both a declaratory judgment establishing ownership in the

websites and damages for the wrongful transfer of the websites and merchant account

to SMLL and SMIL. They alleged that JEA engaged in "self-dealing" when he

transferred the websites and merchant account to SMLL and SMIL, where he and his

son served in some corporate capacity. Specifically, the Appellees/Plaintiffs alleged

that SMLL's "managing member" was JEA's son and SMIL's "officer, managing

1The initial complaint sought declaratory relief and was filed against JEA alone. The initial complaint did not contain any derivative claims on behalf of SMI.

-2- member, and owner" was JEA himself. And though JEA's son was alleged to be

SMLL's managing member, the Appellees/Plaintiffs asserted that SMLL was actually

"the alter ego of Defendant [JEA]."

In their second amended complaint, the Appellees/Plaintiffs raised several

causes of action against JEA alone, including intentional interference with royalty

agreements (count II), breach of fiduciary duty (count III), fraudulent transfers (count IV),

securities fraud (count VI), and corporate waste (count VII). As to SMLL and SMIL, the

Appellees/Plaintiffs did not assert any individual cause of action. Rather, they

attempted to allege a claim of civil theft (count V) against "[a]ll Defendants." Finally, the

Appellees/Plaintiffs alleged that "venue [was] proper . . . because the acts and

transactions . . . occurred within Hillsborough County, Florida." And though SMLL and

SMIL were alleged to be limited liability corporations existing under the laws of Nevada

and the United Kingdom, respectively, the second amended complaint did not contain

any reference to Florida's long-arm statute, section 48.193, Florida Statutes (2017).

Following the filing of the second amended complaint, SMLL and SMIL

moved to quash service and, alternatively, to dismiss the complaint for failing to allege

sufficient jurisdictional facts to bring it within the ambit of Florida's long-arm statute as

required by Venetian Salami Co. v. Parthenais, 554 So. 2d 499, 502 (Fla. 1989). In

response, the Appellees/Plaintiffs filed an amended memorandum opposing the motion

to dismiss, arguing that personal jurisdiction over SMLL and SMIL exists because

tortious conduct and fraudulent transfers occurred in Florida. On December 20, 2017,

the trial court held a nonevidentiary hearing on the motion. At the hearing, the trial court

orally denied the motion, finding—incorrectly—that paragraphs thirteen and fourteen of

-3- the second amended complaint alleged that SMLL and SMIL were "residents of

Hillsborough County, Florida." Indeed, those paragraphs alleged only that JEA and his

son were "citizen[s] of Hillsborough County, Florida." Despite this error, the trial court

still entered a written order, denying the motion to quash service and/or dismiss the

complaint. This appeal ensued.

Discussion

We review de novo a trial court's ruling on a motion to dismiss for lack of

personal jurisdiction. See Wendt v. Horowitz, 822 So. 2d 1252, 1256 (Fla. 2002);

Stonepeak Partners, LP v. Tall Tower Capital, LLC, 231 So. 3d 548, 552 (Fla. 2d DCA

2017). We also strictly construe the long-arm statute in favor of the nonresident

defendant. Stonepeak Partners, 231 So. 3d at 552 (citing Navas v. Brand, 130 So. 3d

766, 770 (Fla. 3d DCA 2014)).

To determine whether the trial court has personal jurisdiction over a

nonresident defendant, the Florida Supreme Court in Venetian Salami set forth a two-

step analysis. See Stonepeak Partners, 231 So. 3d at 552. "The trial court must first

determine whether the complaint alleges sufficient jurisdictional facts to bring the action

within the ambit of the long-arm statute. If it does, then the trial court must determine

whether sufficient minimum contacts are shown to satisfy due process requirements."

Id. (citation omitted) (citing Rautenberg v. Falz, 193 So. 3d 924, 928 (Fla. 2d DCA

2016)).

Section 48.193 lists the acts that may subject a nonresident defendant to

Florida's long-arm jurisdiction. See § 48.193(1)(a)(1)-(9). The Appellees/Plaintiffs rely

on three of those subsections, which provide as follows:

-4- (1)(a) A person, whether or not a citizen or resident of this state, who personally or through an agent does any of the acts enumerated in this subsection thereby submits himself or herself and, if he or she is a natural person, his or her personal representative to the jurisdiction of the courts of this state for any cause of action arising from any of the following acts:

1. Operating, conducting, engaging in, or carrying on a business or business venture in this state or having an office or agency in this state.

2. Committing a tortious act within this state.

....

7. Breaching a contract in this state by failing to perform acts required by the contract to be performed in this state.

§ 48.193(1)(a)(1), (2), (7). And finally, the Appellees/Plaintiffs rely upon the alter ego

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