New England College v . Drew University CV-08-424-JL 10/23/09 UNITED STATES DISTRICT COURT DISTRICT OF NEW HAMPSHIRE
New England College
v. Civil N o . 08-cv-424-JL Opinion N o . 2009 DNH 158 Drew University, and Anne Marie Macari
MEMORANDUM ORDER
This case involves a dispute between two colleges over
poetry in motion. The plaintiff, New England College (“NEC”),
has sued Drew University (“Drew”) and Anne Marie Macari, alleging
that while Macari was serving as interim director of NEC’s
graduate poetry program, she secretly conspired with Drew to
develop a similar program and to solicit NEC faculty and students
to affiliate with Drew. NEC has brought claims of breach of
fiduciary duty, breach of contract, and intentional interference
with various contractual and other relationships, including
between NEC and its faculty and students.
Drew filed a motion to dismiss for lack of personal
jurisdiction o r , in the alternative, to transfer venue to the
District of New Jersey (where Drew is located), arguing that it
has insufficient contacts with New Hampshire (where NEC is
located). This court denied the motion on February 1 7 , 2009,
without prejudice to its reinstatement after a period of jurisdictional discovery. See New Eng. College v . Drew Univ.,
2009 DNH 016, 1 0 .
Drew has now reinstated the motion. This court has subject-
matter jurisdiction under 28 U.S.C. § 1332(a)(1) (diversity).
After hearing oral argument and evaluating the parties’ written
submissions, including discovery materials, this court denies
Drew’s motion. Although the court initially had been “inclined
to grant” the motion because NEC had presented only “speculation
without any evidentiary foundation,” id. at 5 , 9, jurisdictional
discovery has enabled NEC to make a prima facie showing –-
sufficient to establish personal jurisdiction over Drew –- that
Drew authorized or at least ratified Macari’s efforts to move the
poetry program to Drew, such that her conduct in New Hampshire
can be imputed to Drew for jurisdictional purposes. In addition
to Macari’s efforts, Drew purposefully directed its out-of-forum
activities at NEC in New Hampshire with knowledge that they would
have significant in-forum effects.
I. Applicable legal standard
The plaintiff bears the burden of showing personal
jurisdiction over the defendants. See Hannon v . Beard, 524 F.3d
275, 279 (1st C i r . ) , cert. denied, 126 S . C t . 726 (2008). When
evaluating a defendant’s motion to dismiss for lack of personal
2 jurisdiction, the standard of review varies according to the
procedural posture of the case. See Boit v . Gar-Tec Prods.,
Inc., 967 F.2d 6 7 1 , 674-78 (1st Cir. 1992). Where, as here, the
court rules on such a motion without holding an evidentiary
hearing, it applies a “prima facie” standard of review.1 See,
e.g., U.S. v . Swiss Am. Bank, Ltd., 274 F.3d 6 1 0 , 618 (1st Cir.
2001). “Under the prima facie standard, the inquiry is whether
the plaintiff has proffered evidence which, if credited, is
sufficient to support findings of all facts essential to personal
jurisdiction.” Phillips v . Prairie Eye Ctr., 530 F.3d 2 2 , 26
(1st Cir. 2008), cert. denied, 129 S . C t . 999 (2009). The court
must accept the plaintiff’s evidentiary proffers as true, so long
as they are properly documented, and must construe them in the
light most favorable to the existence of jurisdiction. Id.
Facts put forward by the defendants may be considered only if
they are “uncontradicted” by the plaintiff’s submissions. Mass.
Sch. of Law at Andover, Inc. v . Am. Bar Ass'n, 142 F.3d 2 6 , 34
1 Drew did not request an evidentiary hearing or a different standard of review in its motion to dismiss. The court of appeals has said that “all litigants effectively are on notice that motions to dismiss for want of personal jurisdiction will be adjudicated under the prima facie standard unless the court informs them in advance that it will apply a more demanding test,” which has not happened here. Rodriguez v . Fullerton Tires Corp., 115 F.3d 8 1 , 84 (1st Cir. 1997) (emphasis in original). Drew therefore waived any argument for a different standard of review.
3 (1st Cir. 1998). The following statement of facts conforms to
those requirements.
II. Background
In March 2007, Macari accepted an offer to become interim
director of the graduate poetry program at NEC in Henniker, New
Hampshire, where she had been a faculty member. The program,
which involved long-distance learning punctuated by brief periods
of residency with prominent poets, was billed by NEC as the only
all-poetry program of its kind.
About a month later, without telling NEC, Macari met with
Drew’s president and other representatives in New Jersey to
discuss the possibility of developing a similar poetry program at
Drew. Macari told them about her interim position at NEC and
said that she could bring a good faculty with her to Drew,
including some of the poets affiliated with NEC’s program.
Macari, who lived in New Jersey, returned to New Hampshire
shortly thereafter to direct the NEC program’s summer residency.
While in New Hampshire, she spoke with various NEC faculty
members about possibly affiliating with Drew, and some of them
expressed interest in doing s o . She did not tell anyone else at
NEC about her plans.
4 Macari met with Drew officials again in New Jersey at the
end of the summer. In advance of the meeting, she provided them
with background materials regarding the proposed program, such as
a potential faculty list that included various NEC faculty
members, budget notes that were based in part on “the budget that
I have from our school,” and a curriculum similar to that of
NEC’s program. At the meeting, the parties discussed “bringing
most of our faculty from NEC” to Drew. Drew also agreed to
accept NEC transfer students with full credit for their prior
coursework and “the same tuition and scholarships as was given to
them at NEC.”
After that second meeting, Macari continued to work on a
more detailed budget proposal. She sent Drew two versions in
October 2007. The first version “assume[d] that most of our
students [will] follow us” from NEC to Drew, and the other
version assumed the opposite. Macari expressed concern that a
delayed start to Drew’s program “may well mean that our students
at NEC will get used to the new director and will chose [sic] not
to follow us to Drew,” but added, “[o]f course I hope that most
of them will follow us.” Her budget included detailed
information about NEC’s tuition rates, scholarship funding,
advertising methods, and faculty salaries. She told Drew that
the cost of linens during residency periods was the “only detail
5 I can’t seem to pin down without giving myself away too much to
my coworker [i.e., the program administrator] at NEC.”
Macari collaborated with a Drew professor, Peggy Samuels, to
develop a written sales pitch to be used in gaining approval for
the poetry program from the relevant committees at Drew. The
sales pitch stated that the program had “used NEC as its
institutional home” for the past fifteen years and that Macari
was “seek[ing] to find a new institutional home for the program,”
which “already has a strong national reputation.” The sales
pitch noted that the budget projections were based on the
previous known costs of NEC’s program. One of Drew’s faculty
members commented approvingly that “this MFA [program] is hardly
starting from scratch –- rather, it is being transplanted more or
less whole to a new institutional home. Its faculty are already
in place.” A summary that Drew provided to its Academic Affairs
Committee also stated that it was “expected that a number of
[NEC] students will follow the faculty to Drew.”
When the program received a favorable vote from Drew’s
Academic Affairs Committee in December 2007, Professor Samuels
wrote to Macari: “I’m glad we managed to get to this [p]oint
before the Jan[uary] Res[idency] so that you can spread the word
there a bit.” Samuels acknowledged at her deposition that
6 “there” meant NEC and that she was asking Macari to spread the
word about Drew’s new program.
Macari announced her resignation from NEC in February 2008,
after the January residency period. The news came as a surprise
to NEC officials, who still knew nothing of her plans with Drew.
Macari had felt like she was simultaneously “doing 2 jobs, one of
them [with Drew] is covert and doesn’t pay (yet), and the other
one [with NEC] is horrible and pays poorly.” After breaking the
news to NEC, she admitted to Drew officials that “it has been a
real strain for me to be trying to do right by both Drew and NEC
and I am relieved to be finished with NEC now.”
The presidents of Drew and NEC later discussed the matter by
phone, and Drew’s president indicated that Drew might take a few
faculty members from NEC’s program but would not be soliciting
any of NEC’s students. There is evidence, however, that Macari
affirmatively contacted at least one incoming NEC student about
Drew’s program and also reported to Drew’s president on NEC
student interest in Drew. Ultimately, several NEC faculty
members and students did affiliate with Drew’s program. NEC
claims that its program suffered lower enrollment and other
adverse effects because of Drew’s actions.
7 III. Analysis
A. Personal jurisdiction
There is no claim here that the court has general
jurisdiction over Drew. See Harlow v . Children’s Hosp., 432 F.3d
5 0 , 57 (1st Cir. 2005) (explaining the difference between general
and specific jurisdiction). NEC bases its claim of specific
personal jurisdiction over Drew on the New Hampshire long-arm
statute, which provides that “jurisdiction over nonresidents may
be exercised whenever the requirements of the Due Process Clause
of the United States Constitution are satisfied.” Alacron, Inc.
v . Swanson, 145 N.H. 625, 628 (2000); see U.S. Const. amend. XIV.
The court therefore proceeds directly to the due process
analysis.
Due process under the Fourteenth Amendment requires that a
defendant have “sufficient minimum contacts with the [forum]
state such that ‘maintenance of the suit does not offend
traditional notions of fair play and substantial justice.’”
Adelson v . Hananel, 510 F.3d 4 3 , 49 (1st Cir. 2007) (quoting
Int'l Shoe C o . v . Washington, 326 U.S. 3 1 0 , 316 (1945)) (further
quotation omitted). Specific jurisdiction consists of three
elements: First, the defendant must have “purposefully directed”
its activities at the forum state. Keeton v . Hustler Magazine,
Inc., 465 U.S. 7 7 0 , 774 (1984) (purposeful availment). Second,
8 each of the plaintiff’s causes of action must be “related to or
arise[] out of” those forum-directed activities. Helicopteros
Nacionales de Colombia, S.A. v . Hall, 466 U.S. 4 0 8 , 414 (1984)
(relatedness). Third, the exercise of jurisdiction must be
reasonable. See Phillips, 530 F.3d at 2 7 .
As to purposeful availment, NEC has proffered evidence that,
if accepted as true and construed in the light most favorable to
NEC, shows that Drew purposefully directed its activities at New
Hampshire. The evidence would support an inference that Drew and
Macari sought, in effect, to relocate an established poetry
program from NEC in New Hampshire to Drew in New Jersey and to
bring along NEC faculty and students. Many of Drew’s documents
describe their plans in precisely that manner (e.g., as creating
a “new institutional home” for NEC’s program). The evidence also
would support an inference that Drew encouraged Macari to
secretly gather information about NEC’s budget and operations in
New Hampshire for use by Drew in developing its rival program.
All of these actions were aimed directly at a New Hampshire
institution.
In perhaps the clearest example of purposeful availment,
Drew expressly asked Macari to “spread the word” about its new
program at NEC while directing her last residency there. This
request cannot be brushed aside as a single, isolated statement.
9 When viewed (as it must be) in the context of their other
communications and construed in the light most favorable to NEC,
the statement is a clear instruction from Drew to Macari to
follow through on their express plan to lure faculty and students
from NEC to Drew, as just approved by Drew’s Academic Affairs
Committee.
Drew argues that there is no evidence that any of its
representatives ever visited New Hampshire in connection with
this matter or committed any relevant acts here. This argument
fails for two reasons. First, Macari committed a number of
relevant acts in New Hampshire on Drew’s behalf and with Drew’s
knowledge. It is well established that a plaintiff’s
jurisdictional showing “may rely in whole or in part on actions
imputed to [an entity] through its agents.” Jet Wine & Spirits,
Inc. v . Bacardi & Co., Ltd., 298 F.3d 1 , 7 (1st Cir. 2002). The
agent can either be “initially authorized to act on behalf of a
principal” or the principal can “later ratif[y] the agent’s
conduct.” Daynard v . Ness, Motley, Loadholt, Richardson & Poole,
P.A., 290 F.3d 4 2 , 55 (1st Cir. 2002). The key question is not
whether an agency relationship technically exists under state
law, but whether a sufficient relationship exists to attribute
the agent’s acts to the principal under the Due Process Clause.
Jet Wine, 298 F.3d at 7 ; see also Daynard, 290 F.3d at 5 6 .
10 Here, there is ample evidence that Drew authorized or at
least ratified Macari’s acts in New Hampshire (e.g., telling her
to “spread the word” of Drew’s program at NEC; using her NEC-
based budget). Macari admits that she felt like she was doing
two jobs, one overtly for NEC and one covertly for Drew. Indeed,
she was introduced to Drew’s graduate faculty in November 2007 as
“the new director for the proposed MFA in poetry program.”2
Under the circumstances, her conduct can reasonably be attributed
to Drew for purposes of the jurisdictional analysis. See
Donatelli v . Nat’l Hockey League, 893 F.2d 459, 468 (1st Cir.
1990) (explaining that jurisdictional agency issues must be based
on a “frank appraisal of the realities surrounding any given
relationship”).3 2 At oral argument, Drew stated that the new program did not receive final approval until February 2008, just before Macari resigned from NEC, and that Macari did not become a paid employee of Drew until March 2008. But construed in the light most favorable to NEC, the record nevertheless suggests that approval of the new program became a near certainty when it received a favorable vote from Drew’s Academic Affairs Committee in December 2007 and that Macari acted with Drew’s authorization and ratification long before she became a paid employee. 3 This agency theory of jurisdiction is distinct from the conspiracy theory of jurisdiction that this court analyzed in its earlier order granting jurisdictional discovery. See New Eng. College, 2009 DNH 016, at 7 (noting that the First Circuit has never recognized the conspiracy theory). Because jurisdictional discovery revealed evidence to support a more direct agency relationship, NEC no longer relies primarily on the conspiracy theory to support jurisdiction over Drew (though it has preserved the argument).
11 Second, even if there were no evidence that Drew’s
representatives or agents committed relevant acts while
physically present in New Hampshire, such evidence is not always
required. Under the “effects” theory of personal jurisdiction,
first recognized by the Supreme Court in Calder v . Jones, 465
U.S. 783 (1984), a court may properly assert jurisdiction where a
defendant has committed “intentional, and allegedly tortious,
actions” outside the forum state that “were expressly aimed at”
the forum state with knowledge that “the brunt of [the] injury
would be felt” there. Id. at 789-90. As the court of appeals
has explained, “knowledge that the major impact of the injury
would be felt in the forum State constitutes a purposeful contact
or substantial connection whereby the intentional tortfeasor
could reasonably expect to be haled into the forum State’s courts
to defend his actions.” N . Laminate Sales, Inc. v . Davis, 403
F.3d 1 4 , 26 (1st Cir. 2005) (quoting Hugel v . McNell, 886 F.2d 1 , 4 (1st Cir. 1989)). 4
4 The court of appeals has repeatedly cautioned that the "effects" theory requires more than the mere existence of in- forum effects. See, e.g., Swiss Am. Bank, 274 F.3d at 625; Mass. Sch. of Law, 142 F.3d at 3 6 ; see also PFIP, LLC v . You-Fit, Inc., 2009 DNH 059, 38 n.22 (explaining that Northern Laminate, quoted above, is consistent with that principle). In this case, NEC’s prima facie showing of jurisdiction is based not merely on the existence of such effects, but on Drew's intentional conduct aimed at New Hampshire.
12 The court of appeals has held in multiple cases, including
one decided yesterday, that intentional interference with an in-
forum contract or business relationship can establish
jurisdiction under the “effects” theory. See Astro-Med, Inc. v .
Nihon Kohden Am., Inc., Nos. 08-2334 & 08-2335, 2009 WL 3384786,
at *5-6 (1st Cir. Oct. 2 2 , 2009) (exercising jurisdiction where
nonresident defendant hired employee knowing that he had an in-
forum employment agreement, even though neither the defendant nor
the employee engaged in any relevant in-forum conduct); Jet Wine,
298 F.3d at 10-11 (exercising jurisdiction where nonresident
defendants terminated plaintiff’s right to distribute certain
liquor brands in New Hampshire). While the precise contours of
the jurisdictional analysis continue to be debated, see, e.g.,
Astro-Med, 2009 WL 3384786 at *15-16 (Howard, C.J., concurring)
(arguing for a slightly less demanding test in business tort
cases), this case clearly meets the standard if those cases d o .
The evidence here -- more so than in Astro-Med -- supports an
inference that Drew’s actions were both intended to and did have
a significant impact on an established competitor in New
Hampshire, such that Drew could reasonably expect to be haled
into this forum to defend its actions.
13 As to the relatedness component of the jurisdictional
analysis, all of NEC’s causes of action against Drew directly
relate to or arise from Drew’s conduct directed at New Hampshire,
including but not limited to the imputed conduct by Macari inside
New Hampshire. C f . Astro-Med, 2009 WL 3384786 at *6 (finding
sufficient relatedness to a tortious interference claim even
without any relevant in-state conduct by the employee). For
example, NEC has brought claims for intentional interference with
its existing and/or prospective contractual relations with
faculty and students, and Drew’s conduct involved efforts to lure
NEC faculty and students from New Hampshire to New Jersey. There
is a clear “causal nexus” between the contacts and the claims.
Phillips Exeter Acad. v . Howard Phillips Fund, 196 F.3d 2 8 4 , 289
(1st Cir. 1999) (noting also that “there is a natural blurring of
the relatedness and purposeful availment inquiries in cases in
which the alleged contacts are less tangible than physical
presence,” but they are nonetheless distinct inquiries that share
a “family resemblance”).
Drew has devoted much of its renewed motion to arguing,
based on the jurisdictional discovery, that NEC’s causes of
action lack merit. For example, Drew argues that Macari was an
at-will employee whose employment would have been terminated
anyway and who was free to start a new program with Drew. Drew
14 also notes that, to date, the record contains no faculty or
student contracts other than Macari’s at-will agreement. This is
not, however, the appropriate time to determine the ultimate
merits of NEC’s claims, which are at least colorable as described
in NEC’s pleadings and other filings. See, e.g., Jet Wine, 298
F.3d at 4 , 8 (ruling that, “whatever the ultimate merits of Jet
Wine’s substantive claims,” a “plausible” contractual
interpretation was “sufficient for a prima facie showing of
jurisdiction” and that the merits “may be resolved later”).
Whether meritorious or not, the claims each arise from Drew’s
conduct directed at NEC in New Hampshire, which is the relevant
issue for purposes of jurisdiction.
As to the third element, reasonableness is not a barrier to
this court’s jurisdiction over Drew. The Supreme Court’s
familiar “gestalt factors” guide the reasonableness
determination. World-Wide Volkswagen Corp. v . Woodson, 444 U.S.
286, 292 (1980). They include the forum state’s interest in
adjudicating the dispute; the plaintiff’s interest in obtaining
convenient and effective relief; the defendant’s burden of
appearing; the interstate judicial system’s interest in obtaining
the most efficient resolution of the controversy; and the shared
interest of the states in furthering fundamental substantive
social policies. United Elec., Radio and Mach. Workers of Am. v .
15 163 Pleasant S t . Corp., 960 F.2d 1080, 1088 (1st Cir. 1992)
(citing Burger King Corp. v . Rudzewicz, 471 U.S. 4 6 2 , 477
(1985)).
The factors favoring litigation in New Hampshire include, in
this case, New Hampshire’s interest in redressing harms against
its residents and NEC’s interest in obtaining convenient and
effective relief from a court in its own state. See N . Laminate,
403 F.3d at 26 (citing similar factors). Both New Hampshire and
New Jersey -– Drew’s preferred forum –- would be efficient places
to resolve the controversy. The only factor in New Jersey’s
favor is the defendant’s burden of appearing, and Drew has
presented no persuasive reasons why the burden of defending a
suit in New Hampshire from New Jersey outweighs the factors
favoring New Hampshire. See id.
Stepping back to the fundamental principles of the
constitutional analysis, it is entirely consistent with “fair
play and substantial justice” for Drew to be called to answer in
New Hampshire for its efforts to move an established poetry
program from this state to its campus in New Jersey. Int’l Shoe,
326 U.S. at 316. The court therefore denies Drew’s motion to
dismiss for lack of personal jurisdiction.
16 B. Venue
As an alternative to dismissal, Drew requests that this
court transfer venue to the District of New Jersey, where Drew is
located. A district court may transfer a civil action to any
other district where it may have been brought “[f]or the
convenience of parties and witnesses, in the interest of
justice.” 28 U.S.C. § 1404(a). The court has wide latitude in
determining whether to grant such a transfer. Auto Eur., LLC v .
Conn. Indem. Co., 321 F.3d 6 0 , 64 (1st Cir. 2003). There i s ,
however, “a strong presumption in favor of the plaintiff's choice
of forum,” which the party requesting transfer must overcome.
Coady v . Ashcraft & Gerel, 223 F.3d 1 , 11 (1st Cir. 2000) (citing
Gulf Oil Corp. v . Gilbert, 330 U.S. 5 0 1 , 508 (1947)). This
presumption is particularly strong where, as here, the plaintiff
has chosen its home state as the forum. Sousa v . TD Banknorth
Ins. Agency, Inc., 429 F. Supp. 2d 4 5 4 , 457 (D.N.H. 2006)
(Barbadoro, D.J.) (citing Piper Aircraft C o . v . Reyno, 454 U.S.
235, 255 (1981)).
Drew has not met the demanding standard for a transfer. Any
convenience that Drew and Macari would gain from litigating in
New Jersey would be offset by the inconvenience that NEC would
suffer from litigating outside of New Hampshire. The operative
events occurred in both jurisdictions. Witnesses and evidentiary
17 materials are located in both jurisdictions. To the extent that
the New Jersey witnesses may outnumber the New Hampshire
witnesses and would be beyond this court’s subpoena power, many
of them are affiliated with Drew and thus would be likely to
comply with a request from Drew that they testify. See id. at
458. Several witnesses already have been deposed and thousands
of pages already have been produced in connection with
jurisdictional discovery, with no serious forum-related problems
reported or alleged by Drew. Either of the two jurisdictions
would have been an appropriate and efficient forum. The
plaintiff chose New Hampshire, its home state, and the defendant
has not provided a compelling basis for this court to override
that choice. Drew’s request for a venue transfer is therefore
denied.
IV. Conclusion
For the foregoing reasons, Drew’s renewed motion to dismiss
for lack of personal jurisdiction5 is DENIED. That motion’s
request to transfer venue to the District of New Jersey is also
5 Document n o . 3 6 .
18 SO ORDERED.
/ / ___ -_____"^
Jo'seph ___ . ^ 4 t e Uni/ed States District Judge
Dated: October 2 3 , 2009
cc: William D. Pandolph, Esq. John J. Peirano, Esq. Kimberly A . Capadona, Esq. Martha Van Oot, Esq. John G. Vanacore, Esq.