Ritz Fuente, LLC v. SHS Armin Schafer Jr.

District Court, S.D. California·Decided August 9, 2024·No. 3:21-cv-01986·Unknown

Opinion

RITZ FUENTE, LLC, Case No.: 21cv1986-JES (JLB)

Plaintiff, ORDER GRANTING DEFENDANT’S v. MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION

Defendant. [ECF No. 21] Before the Court is Defendant SHS Armin Schafer Jr.’s (“Schafer”) motion to dismiss for lack of personal jurisdiction. ECF No. 21. Plaintiff filed an opposition, and Defendant filed a reply. ECF Nos. 22, 23. The Court found the matter suitable for submission on the papers. ECF No. 24. After due consideration and for the reasons discussed below, the motion is GRANTED and the case is DISMISSED for lack of personal jurisdiction. Plaintiff Ritz Fuente, LLC (“Ritz Fuente”) brought this action against Defendant Schafer for breach of contract stemming from the sale of a showjumping horse, Lanciano 81. ECF No. 20. Ritz Fuente is a Wyoming limited liability company with two members: (1) Joseph Sorge, an individual owning 75% and domiciled in Wyoming, and (2) Hanna Mauritzson (“Mauritzson”), an individual owning 25% and domiciled in California. Id. at ¶ 1. Defendant Schafer is an individual and is domiciled in Germany. Id. at ¶ 2. Schafer trains and sells competitive show jumping horses in Germany, and is the owner of SHS Special Horse Service. Id. at ¶ 6. Schafer has a website published in German and English regarding his horses and services. Id. at ¶ 7. Schafer also uses platforms such as Facebook and Instagram for promotions that feature his horses, services, farm, and himself. Id. at ¶¶ 10, 12, Exs. 5, 6. Plaintiff alleges that these online and social media platforms are accessible and displayed to California residents. Id. at ¶ 13. In addition, approximately 8 to 10 years ago, Plaintiff alleges that Schafer attended a show jumping event in California. Id. at ¶ 11. Plaintiff further alleges that Schafer has sold or trained five horses associated with the United States. Id. at ¶ 9. Schafer’s primary form of marketing is “word-of-mouth advertising,” which Plaintiff alleges is how Mauritzson was introduced to Schafer. Id. at ¶ 14. Mauritzson and another individual named Ashlee Bond (“Bond”) met at a showjumping event in Del Mar, California. Id. at ¶ 14. Bond, a California resident, informed Mauritzson that she could help her find a horse in Germany. Id. Plaintiff alleges that Bond told Mauritzson at that time that she customarily receives a 5% commission for her aid if it results in a sale, but that the commission was paid by the seller, not buyer. Id. Bond then contacted a German dealer/agent named Klaus Schaaf (“Schaaf”). Id. ¶ 15. Schaaf sent videos of horses from farms he toured in Germany. Id. at ¶ 16. One of the videos he sent to Mauritzson and Bond was Lanciano 81 from Schafer’s farm. Id. Mauritzson then traveled to Germany to meet Schaaf and tour show-jumping horse farms, including Defendant Schafer’s farm. Id. at ¶ 17. Plaintiff alleges that Mauritzson told Schafer at that time that she was from California and “was looking to bring a horse back to California.” Id. at ¶ 6. In November 2018, Ritz Fuente entered into an agreement with Schafer to buy Lanciano 81 which was considered a high-level jumping horse. Id. at ¶ 18, Ex. 1. Schafer represented that the horse competed at the 1.50-1.55m level and was ready to compete at the 1.60m level. Id., Ex. 1. Schafer also represented the horse was in “good health and condition” and fit for the intended purpose of competing at the 1.50m level. Id. at ¶ 19. Under the agreement, Schafer would provide a mutual carrier to deliver the horse. Id. The horse was delivered to Ritz Fuente in San Diego on or about December 13, 2018. Id. at ¶ 20. The purchase price was $397,355, which Plaintiff alleges was transferred from a California bank to Schafer. Id. at ¶ 21. Ritz Fuente alleges that, from this amount, Schafer paid a commission to Schaaf and Bond for the sale of Lanciano 81. Id. Including this sale, Plaintiff alleges that Schafer has sold fourteen horses, four of which were sold to California residents. Id. at ¶ 23. In the months following the horse delivery, Plaintiff alleges that it realized the horse could not compete at the 1.50m level as promised. Id. at ¶ 24. As a result, Plaintiff initiated this lawsuit, asserting a cause of action for breach of contract. On September 8, 2022, Schafer filed his first motion to dismiss for lack of subject matter jurisdiction. ECF No. 13. The Court granted this motion on August 17, 2023, but also granted Plaintiff limited jurisdictional discovery for Schafer’s sales and contacts in California. ECF No. 17. On October 27, 2023, Plaintiff filed its Second Amended Complaint. ECF No. 20. Schafer then filed this second motion to dismiss for lack of personal jurisdiction, which is currently pending before the Court. ECF No. 21. Defendant Schafer brings this motion to dismiss under Federal Rule of Civil Procedure 12(b)(2). Once the defendant moves to dismiss for lack of personal jurisdiction, the plaintiff then bears the burden to establish that the Court has personal jurisdiction over the defendant. Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218, 1223 (9th Cir. 2011). Where the defendant’s motion is based on written materials such as affidavits rather than an evidentiary hearing, the plaintiff need only make a prima facie showing of jurisdictional facts to withstand the motion to dismiss. Marvix Photo, 647 F.3d at 1223. The plaintiff cannot “simply rest on the bare allegations of its complaint,” but uncontroverted allegations in the complaint must be taken as true. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004) (quoting Amba Mktg. Sys., Inc. v. Jobar Int’l, Inc., 551 F.2d 784, 787 (9th Cir. 1977)). Allegations in the complaint may be contradicted by affidavit, but factual disputes must be resolved in the plaintiff’s favor. Marvix Photo, 647 F.3d at 1223. Where, as here, federal court jurisdiction is based on 28 U.S.C. § 1332(d) and only state law causes of action are asserted, the district court applies the law of the state in which it sits—here, California—to establish personal jurisdiction. Core-Vent Corp. v. Nobel Industries AB, 11 F.3d 1482, 1484 (9th Cir. 1993). California’s long-arm statute permits a court to exercise personal jurisdiction over a defendant to the extent permitted by the Due Process Clause of the Constitution. Cal. Code Civ. P. § 410.10; Gordy v. Daily News, L.P., 95 F.3d 829, 831 (9th Cir. 1996). Therefore, to establish personal jurisdiction, Plaintiff must satisfy the due process Constitutional requirements. For a court to exercise personal jurisdiction over a nonresident defendant consistent with due process, that defendant must have “certain minimum contacts” with the relevant forum “such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’” International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463 (1940)). Minimum contacts can either be established through general or specific jurisdiction. General jurisdiction exists when a defendant has “continuous and systematic” contacts with the forum state. Brand v. Menlove Dodge,

Ritz Fuente, LLC v. SHS Armin Schafer Jr., (S.D. Cal. 2024).

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