UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE
R&R Auction Company, LLC
v. Case No. 15-cv-199-PB Opinion No. 2016 DNH 040 Michael Johnson
MEMORANDUM AND ORDER
This lawsuit is the latest installment in an ongoing
dispute between R&R Auction Company, LLC, a New Hampshire-based
auction house, and Michael Johnson, a California resident.
After bidding in a number of the company’s auctions between 2005
and 2011, Johnson complained that items he had acquired through
R&R Auction were inauthentic. He filed suit against R&R Auction
in 2012 in California state court.
After years of increasingly hostile litigation in
California, R&R Auction brought this action in 2015, alleging
that Johnson has acted improperly in the course of prosecuting
his California lawsuit. R&R Auction complains, among other
things, that Johnson created several websites that incorporate
R&R Auction’s name, and posted information online that has
harmed R&R Auction’s reputation. R&R Auction’s complaint
includes a raft of federal and state-law claims. Johnson has
responded with a motion to dismiss for lack of personal
jurisdiction. I. BACKGROUND R&R Auction is a limited liability company formed under
New Hampshire law, with its principal place of business in
Amherst, New Hampshire. It hosts auctions via a print catalog
and its website, rrauction.com. Johnson is a California
resident.
From 2003 until 2011, R&R Auction mailed, at Johnson’s
request, auction catalogs to Johnson in California. From 2005
until 2011, Johnson participated in auctions through the
company’s website, acquiring more than eighty items in thirty-
three auctions. Johnson also consigned for sale more than
twenty items through R&R Auction, and sold items in six
auctions.
Both R&R Auction’s catalog and website describe the terms
and conditions that must be met to participate in an auction.
The catalog provides that “[p]lacing a bid in this auction
constitutes full acceptance of all of the conditions, bidding
rules, and terms of sale presented [in the catalog],” and
similar language appears on the website. Doc. No. 1 at 8.
These terms include a “Guarantees” provision regarding the
authenticity of items acquired through R&R Auction. According
to this provision, “[t]he buyer’s only remedy under this
2 guarantee is the cancellation of the sale [of the inauthentic
item] and the refund of the purchase price.” Id.
In 2011, Johnson began to claim that items he had acquired
through R&R Auction were inauthentic. When he and R&R Auction
were unable to reach an amicable resolution, Johnson filed suit
in 2012 in Santa Barbara County Superior Court in California.
Johnson alleged that R&R Auction had violated California law by
auctioning (reportedly) knockoff items.
While the California lawsuit was ongoing, Johnson
registered several Internet domain names incorporating the term
“R&R Auction,” or the names of individuals associated with R&R
Auction. I describe these sites collectively as “the Litigation
Website.”1 Doc. No. 1 at 17. The Litigation Website’s stated
purpose is to “provide a venue in which interested parties may
learn more about this case which is currently in litigation in
Santa Barbara Superior Court.” Id. To that end, the website
includes contact information for Johnson’s attorneys, and allows
visitors to submit a “message regarding this potential lawsuit.”
Id. The website also provides links to Twitter, Facebook, and
1 Those websites include: rrauctionlawsuit.com, rrauction.biz; rrauctionauthentication.com; rrauctionautographauthentication.com; rrauctionclassactionlawsuit.com; rrauctioncomplaint.com; rrauctionfraud.com; rrauctionguarantee.com; rrauctions.net; bobseaton.com; triciaeaton.com; bobbylivingston.com; billwhiterrauction.com. 3 YouTube pages, reportedly operated by Johnson, that were created
in connection with the California lawsuit. The website is
accessible in New Hampshire, and has been viewed by at least one
New Hampshire resident. Doc. No. 15 at 3.
Johnson began posting information about his lawsuit on the
Litigation Website and other websites. In September 2014, he
made several posts on complaintsboard.com, stating that a class
action lawsuit had been filed “against RR Auction located in
Amherst, New Hampshire,” and inviting “potential class
member[s]” to visit the Litigation Website. Doc. No. 1 at 12-
13. In January and February 2015, Johnson posted video
depositions taken of several R&R Auction employees.
In March 2015, Johnson posted to the Litigation Website the
so-called “Alleged Burris Affidavit,” a 2008 affidavit
purportedly authored by Karen Burris, a former R&R Auction
employee. Id. at 20-26. Burris was R&R Auction’s office
manager from 2001 until 2008, when R&R Auction accused her of
stealing more than $400,000 from the company. On April 2, 2008,
the day after R&R Auction forwarded information about the
missing funds to law enforcement, Burris committed suicide. Id.
at 21. Several months later, R&R Auction reached a confidential
settlement and non-disclosure agreement with Burris’s estate,
her late husband, William Burris, and Mr. Burris’s company. Id.
In February 2015, Johnson’s counsel subpoenaed Mr. Burris, then
4 living in Montana, for “[a]ll writings about or concerning R&R
Auction Company” in Mr. Burris’s possession. Id. at 22.
Johnson’s counsel then interviewed Mr. Burris, without notifying
R&R Auction. When Mr. Burris turned over the “Alleged Burris
Affidavit” to Johnson, Johnson filed that document in court, and
posted it on his website.
These various postings led to unwanted negative attention
for R&R Auction. Members of the press wrote articles about the
California litigation, often referring to materials posted on
the Litigation Website. Id. at 36-37. Bob Sanders from the New
Hampshire Business Review, for example, contacted R&R Auction
for comment, noting that he currently “only [had] the plaintiffs
side” but had “the depositions on the plaintiffs website.” Id.
at 36. R&R Auction was criticized on social media, and certain
past, present, and potential R&R Auction customers have
contacted the company to express concern about Johnson’s
lawsuit. Some ended their relationship with the company.
Thus, after years of increasingly bitter litigation in
California, R&R Auction filed this suit in New Hampshire. In
its fifteen-count complaint, R&R Auction alleges that “[a]s a
direct and proximate result of the California Litigation, the
Litigation Website, and Mr. Johnson’s other conduct, RR Auction
has suffered a material decline in business.” Id. at 44.
5 II. STANDARD OF REVIEW When a defendant challenges the court’s personal
jurisdiction under Federal Rule of Civil Procedure 12(b)(2), the
plaintiff bears the burden of establishing a basis for asserting
jurisdiction. See Mass. Sch. Of Law at Andover, Inc. v. Am.
Bar. Ass’n., 142 F.3d 26, 34 (1st Cir. 1998). Because I did not
hold an evidentiary hearing in this case, R&R Auction need only
make a prima facie showing of jurisdiction. See Cossaboon v.
Me. Med. Ctr., 600 F.3d 25, 31 (1st Cir. 2010).
To meet this standard, R&R Auction must “adduce evidence of
specific facts” that support its jurisdictional claim. Foster-
Miller, Inc. v. Babcock & Wilson Can., 46 F.3d 138, 145 (1st
Cir. 1995). I accept “specific facts affirmatively alleged by
the plaintiff as true (whether or not disputed) and construe
them in the light most congenial to the plaintiff’s
jurisdictional claim.” Mass. Sch. Of Law, 142 F.3d at 34. I
need not, however, “credit conclusory allegations or draw
farfetched inferences.” Id. (citation omitted). I may also
consider uncontested facts submitted by the defendant. Id. In
conducting this analysis, I assess “whether the facts duly
proffered, [when] fully credited, support the exercise of
personal jurisdiction.” Alers-Rodriguez v. Fullerton Tires
Corp., 115 F.3d 81, 83 (1st Cir. 1997).
6 III. ANALYSIS A. Legal Framework Personal jurisdiction over an out-of-state defendant turns
on both (1) constitutionally sufficient “minimum contacts,” and
(2) service of process in accordance with Federal Rule of Civil
Procedure 4(k). For claims based on federal law, the Fifth
Amendment’s due process clause sets the constitutional limits of
the court’s jurisdiction. United States v. Swiss Am. Bank,
Ltd., 274 F.3d 610, 618 (1st Cir. 2001). The Fifth Amendment
demands only that the defendant have sufficient “minimum
contacts” with the United States as a whole. Id. State law
claims, however, are governed by the Fourteenth Amendment’s due
process clause, which requires that the defendant have
sufficient contacts with the particular state in which the court
sits. Id. Here, R&R Auction has brought both federal and state
law claims.
Federal Rule of Civil Procedure 4(k) authorizes
extraterritorial service of process either when allowed by a
federal statute, or when “permitted by the law of the state in
which the district court sits.” United Elec., Radio & Mach.
Workers of Am. v. 163 Pleasant St. Corp., 960 F.2d 1080, 1086
(1st Cir. 1992) (internal quotation marks omitted); Fed. R. Civ.
P. 4(k). In this case, R&R Auction has not identified a federal
statute authorizing it to serve Johnson in New Hampshire. See
7 Sarah’s Hat Boxes, L.L.C. v. Patch Me Up, L.L.C., 2013 DNH 058,
9 n.4 (noting that the Lanham Act does not allow nationwide
service of process). Instead, it relies exclusively on New
Hampshire’s long-arm statute. New Hampshire’s long-arm statute,
in turn, is coextensive with the Fourteenth Amendment. See
Presby Patent Trust v. Infiltrator Sys., Inc., 2015 DNH 111, 2-
3. Therefore, in order to satisfy Rule 4, R&R Auction must
satisfy the Fourteenth Amendment’s due process clause with
respect to both its state and federal claims. Situation
Management Systems v. ASP Consulting Grp., 2006 DNH 092, 5.
The Fourteenth Amendment requires that a defendant have
sufficient “minimum contacts” with the forum such that
“maintenance of the suit does not offend traditional notions of
fair play and substantial justice.” Int’l Shoe Co. v.
Washington, 326 U.S. 310, 316 (1945) (internal quotation and
punctuation omitted). This “minimum contacts” inquiry is
necessarily fact-specific, requiring “an individualized
assessment and factual analysis of the precise mix of contacts
that characterize each case.” Pritzker v. Yari, 42 F.3d 53, 60
(1st Cir. 1994). A defendant cannot be subjected to personal
jurisdiction based upon merely “random, fortuitous, or
attenuated contacts” with the forum. Burger King v. Rudzewicz,
471 U.S. 462, 475 (1985) (internal punctuation omitted).
Instead, there must be some “act by which the defendant
8 purposefully avails itself of the privilege of conducting
activities within the forum State, thus invoking the benefits
and protections of its laws.” Id.
Personal jurisdiction comes in two varieties – general and
specific – depending upon the nature of the defendant’s contacts
with the forum. Sarah’s Hat Boxes, 2013 DNH 058, 11. General
jurisdiction exists where the defendant has engaged in
“continuous and systematic” activity in the forum “sufficient to
establish jurisdiction in that state over all matters including
matters unrelated to the defendant's contacts in the forum
state.” Id. (citing Northern Laminate Sales, Inc. v. David, 403
F.3d 14, 24 (1st Cir. 2005). Specific jurisdiction “exists only
when the cause of action arises from or relates to the
defendant's contacts with the forum state.” Id. R&R Auction
asserts that specific personal jurisdiction exists here.
The First Circuit applies a three-part test to decide
whether specific jurisdiction exists: (1) whether the claims
arise out of, or are related to, the defendant's forum-related
activities (“relatedness”), (2) whether the defendant has
purposefully availed himself of the protections and benefits of
the forum state's laws (“purposeful availment”), and (3) whether
the exercise of jurisdiction is reasonable under the
circumstances (the “gestalt factors”). Phillips v. Prairie Eye
Ctr., 530 F.3d 22, 27 (1st Cir. 2008). The plaintiff must
9 satisfy each of these three requirements. Medicus Radiology,
LLC v. Nortek Med. Staffing, Inc., 2011 DNH 001, 7.
B. Application
Personal jurisdiction must be assessed separately with
regard to each claim. Sarah’s Hat Boxes, 2013 DNH 058, 12. For
the sake of brevity, however, I group R&R Auction’s fifteen
counts into four categories: (1) abusive litigation practices
claims, (2) Lanham Act and state-law claims based upon Johnson’s
unauthorized use of the term “R&R Auction” in connection with
his Litigation Website; (3) intentional interference with
existing and prospective contractual relations claims, and (4)
claims related to Johnson’s allegedly defamatory statements
about R&R Auction. I apply the First Circuit’s three-pronged
inquiry to each of these sets of claims in turn.
As I explain below, R&R Auction’s first two categories of
claims – the litigation abuse and the Litigation Website claims
– are doomed because they fail to satisfy the relatedness
requirement of the personal jurisdiction test. R&R Auction’s
third and fourth sets of claims – the intentional interference
and defamation claims – are, however, premised on facts that
minimally satisfy the relatedness and purposeful availment
requirements. Nonetheless, given the weakness of R&R Auction’s
showing with respect to these two requirements, and the totality
of the circumstances of this case, I conclude that exercising
10 jurisdiction any of over Johnson’s claims would be unreasonable.
See Ticketmaster-New York, Inc. v. Alioto, 26 F.3d 201, 210 (1st
Cir. 1994) (“the weaker the plaintiff's showing on the first two
prongs . . . the less a defendant need show in terms of
unreasonableness to defeat jurisdiction”).
1. Abusive Litigation Tactics – Counts VII, XIV
R&R Auction alleges that Johnson has engaged in certain
“abusive litigation practices” that are actionable under Section
358-A:2 of the New Hampshire Revised Statutes. It also brings
an abuse of process claim, essentially asserting that, in order
to injure R&R Auction, Johnson improperly required Mr. Burris to
produce documents by subpoena. Doc. No. 1 at 60.
R&R Auction has not satisfied the relatedness requirement
as to either claim. A plaintiff generally cannot meet the
relatedness requirement merely by showing that it suffered in-
forum injury from the defendant’s out-of-state misconduct.
Swiss Am. Bank, 274 F.3d at 623; Sawtelle v. Farrell, 70 F.3d
1381, 1390-91 (1st Cir. 1995). Instead, the plaintiff must
point to some forum-related actions by the defendant that are
associated with its claims. Mass. Sch. of Law, 142 F.3d at 35.
R&R Auction has not done so here.2 R&R Auction’s abuse of
process claim, for example, is based upon a contention that
2 In general, R&R Auction’s briefing makes it difficult to determine which of Johnson’s purported contacts with New 11 Johnson (a California resident), subpoenaed Mr. Burris (then
living in Montana), in connection with a lawsuit filed in
California state court. Likewise, the only apparent connection
between R&R Auction’s Section 358-A:2 claim and New Hampshire is
that R&R Auction suffered the effects of Johnson’s alleged
misconduct in its home state. Because that in-forum injury,
standing alone, is insufficient to meet the relatedness
requirement, these claims fail at the first step of the
jurisdictional analysis.3
2. Litigation Website Claims - Counts I-IV, XIV
R&R Auction’s next set of claims includes four Lanham Act
counts and one New Hampshire misappropriation claim, all of
Hampshire arguably satisfy the relatedness requirement. Indeed, after noting that “[t]he first task in a relatedness inquiry involves identifying the alleged contacts,” R&R Auction declines to do so. Doc. No. 15 at 7. R&R Auction instead states that it “has set forth the relevant contacts in the Facts section supra, as well as in the supporting declarations submitted herewith and other prior filings . . . and will not repeat them here.” Id.
3 R&R Auction argues that it has met its burden because “[t]he restrictions imposed on Mr. Burris pursuant to [the settlement agreement], and the New Hampshire-related content of the materials concerning R&R Auction provided by Mr. Burris to Mr. Johnson, are central to [the abuse of process] claim.” Doc. No. 15 at 11. As I understand this argument, R&R Auction seems to contend that the relatedness requirement is satisfied because the settlement agreement at issue is “New Hampshire-based,” and because Mr. Burris produced “New Hampshire-related” materials in response to the offending subpoena. Because, however, R&R Auction has failed to develop this argument properly, I decline to entertain it.
12 which are based upon Johnson’s unauthorized use of the term “R&R
Auction” on the Litigation Website. To establish that these
claims relate to Johnson’s contacts with New Hampshire, R&R
Auction points out that the website: (1) is accessible in New
Hampshire, (2) injures R&R Auction in New Hampshire, and (3) has
been viewed by at least one New Hampshire resident. Doc. No. 1
at 2-3. Following the First Circuit’s recent decision in A
Corp. v. All American Plumbing, 2016 WL 325102 (1st Cir. Jan.
27, 2016), these facts are inadequate to meet R&R Auction’s
burden.
In that case, A Corp., a Massachusetts company, brought a
trademark infringement action against All American Plumbing, an
Arizona corporation, in federal court in Massachusetts. A Corp.
alleged that All American had improperly used A Corp.’s mark on
its website. 2016 WL 325102, at *1. All American moved to
dismiss for lack of personal jurisdiction, arguing that its
limited contacts with Massachusetts – the availability of the
allegedly infringing website, and the fact that the website
caused injury in the forum – were insufficient. The District
Court agreed and granted A Corp.’s motion; the First Circuit
affirmed.
In particular, the First Circuit concluded that A Corp. had
not satisfied the relatedness requirement. According to the
court, A Corp.’s “one and only forum contact - the availability
13 of its website” was inadequate to meet plaintiff’s burden. Id.
at *3. The court further rejected A Corp.’s reliance on its in-
forum injury from All American’s alleged infringement, noting
that “in-forum effects of non-forum activity, standing alone,
[are] insufficient to support personal jurisdiction.” Id. at *3
(citing Sawtelle, 70 F.3d at 1390-91); see also Swiss Am. Bank,
274 F.3d at 623 (“[T]he ‘effects' test is a gauge for purposeful
availment and is to be applied only after the relatedness prong
has already been satisfied”); Mass. Sch. of Law, 142 F.3d at 36
(“We have wrestled before with this issue of whether the in-
forum effects of extra-forum activities suffice to constitute
minimum contacts and have found in the negative”).
In this case, R&R Auction presents effectively the same
argument that the First Circuit rejected in A Corp.. As in A
Corp., R&R Auction principally argues that it has satisfied the
relatedness requirement because Johnson’s infringing website is
accessible in New Hampshire, and causes injury in New Hampshire.
Yet, as A Corp. makes plain, these facts alone are insufficient
to meet R&R Auction’s burden. 2016 WL 325102, at *3. R&R
Auction does note that at least one New Hampshire resident has
visited the website, a fact that arguably distinguishes this
case from A Corp. It has not, however, proffered evidence, for
example, that the website was designed to target New Hampshire
residents (rather than consumers generally), or that Johnson
14 provided any services to New Hampshire consumers through the
site. Cf. Sarah’s Hat Boxes, 2013 DNH 058, 16-17 (the
relatedness requirement is met with respect to a Lanham Act
claim where the defendant sold infringing goods via its website,
and because “by listing cities and towns in New Hampshire, the .
. . website is designed to appear in New Hampshire consumers’
search results”). Under these circumstances, the fact that at
least one New Hampshire resident has viewed the Litigation
Website does not change the outcome. Accordingly, R&R Auction’s
Website claims falter at the first step of the analysis.
3. Intentional Interference Claims – Counts X-XII
R&R Auction next alleges that Johnson intentionally
interfered with its existing contractual relations with bidders
and consignors, and with its potential relations with
prospective bidders and consignors. It also claims that Johnson
intentionally interfered with the company’s settlement and
nondisclosure agreement with Mr. Burris. R&R Auction argues
that it has satisfied the relatedness requirement as to these
claims because (1) it suffered the effects of Johnson’s alleged
interference in New Hampshire, and (2) the contracts at issue
were governed by New Hampshire law. Doc. No. 15 at 2-3, 10. In
particular, R&R Auction points to its agreement with Mr. Burris,
which “explicitly states that it is to be construed and enforced
in accordance with and governed by the laws of the State of New
15 Hampshire.” Doc. No. 15-14 at 3. Pursuant to the First
Circuit’s decision in Astro-Med v. Nihon Kohden American, 591
F.3d 1 (1st Cir. 2009), these facts are minimally sufficient to
satisfy the relatedness requirement.
In Astro-Med, the First Circuit considered whether specific
jurisdiction existed over an out-of-state defendant who had
allegedly interfered with a forum-based contract. 591 F.3d at
9–10. In that case, Astro-Med, a Rhode Island corporation,
entered into a non-competition agreement with its employee. The
agreement contained choice-of-law and forum-selection
provisions, which specified that the agreement would be governed
by Rhode Island law, and required the employee to consent to
litigate in Rhode Island should any agreement-related dispute
arise. Id. at 6. Several years later, the employee applied for
a position with the defendant, a California company that
competed with Astro-Med. Before offering the employee a job,
the defendant “became aware of the Astro–Med Employment
Agreement with [the employee] and referred the contract to
counsel for review.” Id. at 7. The defendant decided to hire
the employee even though its counsel advised “that there was
some minimal risk in hiring” the employee. Id. Astro-Med then
brought suit in federal court in Rhode Island, alleging that the
defendant had intentionally interfered with its contractual
relations with the employee. The defendant moved to dismiss for
16 lack of personal jurisdiction. The district court denied the
motion and the defendants appealed after an adverse jury
verdict.
Relevant here, the First Circuit concluded in Astro-Med
that the plaintiff had satisfied the relatedness requirement.
As the court noted, when the defendant allegedly interfered with
Astro-Med’s contractual relations, it knew (1) that Astro-Med
was located in Rhode Island, (2) that the employee entered into
the agreement in Rhode Island, (3) that the agreement specified
that it was governed by Rhode Island law, (4) that the employee
had consented to litigating any disputes related to the contract
in Rhode Island, and (5) that it was exposing itself to some
risk by hiring the employee. In total, the court reasoned that
these facts were sufficient to meet the relatedness requirement.
In light of Astro-Med, R&R Auction has made a minimally
sufficient relatedness showing here. R&R Auction’s settlement
and non-disclosure agreement with Mr. Burris provided “that it
[was] to be construed and enforced in accordance with and
governed by the laws of the State of New Hampshire.” Doc. No.
15-14 at 3. When Johnson allegedly interfered with this
contractual relationship, he “knew about” this agreement, Doc.
No. 1 at 22; knew that R&R Auction was located in New Hampshire;
and presumably recognized – based upon R&R Auction’s vehement
opposition, id. at 21-23 – that he was exposing himself to some
17 risk by subpoenaing Mr. Burris. Yet, Johnson contacted Mr.
Burris anyway. For essentially the same reasons as in Astro-
Med, then, these claims survive the first requirement of the
specific jurisdiction analysis. The same facts are also
minimally sufficient to meet the purposeful availment
requirement, because Johnson should have reasonably foreseen
that his conduct might cause injury in New Hampshire. See
Medicus Radiology, 2011 DNH 001, 12-14. These claims therefore
survive both the relatedness and purposeful availment
requirements.
4. False or Misleading Statements – Counts VI-VIII, XIII, XIV
R&R Auction’s final set of claims – unfair competition,
commercial disparagement, and false light – result from
Johnson’s various allegedly false and misleading statements
about R&R Auction. R&R Auction contends that it has met the
relatedness requirement as to these claims because: (1)
Johnson’s “introduced his communications into the State,” and
(2) R&R Auction has “felt” the effects of those remarks “within
New Hampshire.” Doc. No. 15 at 10-11.
As explained above, a plaintiff generally cannot meet the
relatedness requirement merely by showing in-forum injury from
the defendant’s out-of-state misconduct. R&R Auction must
instead point to forum-related actions by Johnson connected with
18 these claims. Mass. Sch. of Law, 142 F.3d at 35. To that end,
R&R Auction argues that Johnson “introduced his communications
into” New Hampshire, apparently by speaking with a New Hampshire
Business Review reporter.4 Doc. Nos. 15 at 10-11; 29 at 3-4.
In early 2015, Johnson discussed the California litigation
with Bob Sanders, a New Hampshire Business Review (“NHBR”)
reporter, and allegedly made a defamatory statement about R&R
Auction.5 Apparently following that communication, Sanders
4 To the extent that R&R Auction relies on other individuals’ negative internet comments about R&R Auction, or other journalists’ requests for comment following Johnson’s posts, I reject his argument. Absent some evidence connecting Johnson to those communications, they cannot give rise to jurisdiction over him. See Burger King, 471 U.S. at 474 (“The unilateral activity of those who claim some relationship with a nonresident defendant cannot satisfy the requirement of contact with the forum State.”); Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 417 (1984) (“[U]nilateral activity of a . . . third person is not an appropriate consideration when determining whether a defendant has sufficient contacts with a forum [s]tate to justify an assertion of jurisdiction.”). 5 R&R Auction does not affirmatively allege, let alone present evidence that establishes, that Johnson instigated the communication with the NHBR reporter. At most, R&R Auction hints in a footnote that Johnson may have solicited the call. See Doc. No. 29 at 3 n.8 (suggesting that the NHBR article may have been “NHBR’s organic idea or the result of a ‘tip’ from Johnson’s camp”). Although I must accept “specific facts affirmatively alleged by the plaintiff as true (whether or not disputed) and construe them in the light most congenial to the plaintiff’s jurisdictional claim,” Mass. Sch. Of Law, 142 F.3d at 34, the “burden of proving jurisdictional facts rests on the shoulders of the party who seeks to invoke the court's jurisdiction.” Ticketmaster, 26 F.3d at 207 n.9. On that principle, I assume that Johnson did not initiate the relevant communication. Id. (reaching the same conclusion under similar circumstances). 19 contacted R&R Auction by email for comment on Johnson’s suit,
explaining that Sanders “only [had] plaintiffs’ side [of the
story],” and had “the depositions on the plaintiffs’ website,”
but wanted a quotation “from company officials directly.” Doc.
No. 15-13. Several weeks later, NHBR published an article about
the lawsuit, which included quotations from both Johnson and an
R&R Auction employee. Doc. No. 29-2 (NHBR Article).
The First Circuit addressed an analogous situation in
Ticketmaster. There, the defendant, a California resident, made
an allegedly defamatory statement about the plaintiff during an
unsolicited telephone interview with a Boston Globe reporter.
Ticketmaster, 26 F.3d at 203. After the Globe published an
article that included the defendant’s statement, the plaintiff
sued in federal court in Massachusetts. The defendant then
moved to dismiss for lack of personal jurisdiction.
Based on Ticketmaster, R&R Auction has met the relatedness
requirement. As in Ticketmaster, R&R Auction alleges that
Johnson “knowingly direct[ed] his [allegedly defamatory]
comments into the forum state” by speaking with someone he knew
to be a New Hampshire-based reporter. See Ticketmaster, 26 F.3d
at 207. Johnson’s contact with the New Hampshire is therefore
related to R&R Auction’s defamation claims. These facts also
satisfy the purposeful availment requirement, as it was
reasonably foreseeable that Johnson’s allegedly tortious
20 statement to an NHBR reporter would cause injury in New
Hampshire.
As the Ticketmaster court explained, however, these facts
are only minimally sufficient. According to Ticketmaster, “when
the defendant in a defamation action is a journalist's source,
the link between the defendant's conduct and the cause of action
is attenuated by the intervening activities of third parties,
e.g., the reporter, the editor, the media outlet, and that those
intermediaries shape, amplify, and occasionally distort the
original utterance.” Id. Thus, although Johnson’s statement to
the NHBR reporter may have been “a tort in its own right (if
defamatory),” they “inflicted no significant injury, except
insofar as [they] led to republication in the ensuing” article.
Id. In addition, the purposeful availment showing is weaker in
cases, like this one, where the defendant did not initiate the
communication that led to his allegedly defamatory remark.
In summary, R&R Auction has satisfied the first two
requirements of the jurisdictional analysis with respect to its
intentional interference claims and its false and misleading
statements claims.6 For the reasons provided, however, this
6 R&R Auction brings one additional claim, Count IX, which does not fit neatly into any of the four categories described above. R&R Auction alleges that it and Johnson “were parties to a contractual agreement, namely, the terms and conditions applicable” to the company’s auctions. Doc. No. 1 at 54-55. Those conditions included the “Guarantees” provision, which 21 showing is far from overwhelming. With that in mind, I turn to
the third requirement of the specific jurisdiction analysis, and
assess whether exercising jurisdiction would be reasonable over
any of R&R Auction’s claims.
C. Reasonableness
Exercising jurisdiction over a defendant must be
“reasonable.” The reasonableness inquiry consists of five
“gestalt factors”:
(1) the defendant's burden of appearing; (2) the forum state's interest in adjudicating the dispute; (3) the plaintiff's interest in obtaining convenient and effective relief; (4) the judicial system's interest in obtaining the most effective resolution of the controversy; and (5) the common interests of all sovereigns in promoting substantive social policies.
Sawtelle, 70 F.3d at 1394. The “reasonableness prong . . .
evokes a sliding scale: the weaker the plaintiff's showing on
the first two prongs (relatedness and purposeful availment), the
less a defendant need show in terms of unreasonableness to
defeat jurisdiction.” Ticketmaster, 26 F.3d at 210. Thus,
“[t]he gestalt factors rarely preclude jurisdiction where the
provided that a buyer’s “only remedy” in the event that he bought an inauthentic good was “cancellation of the sale and the refund of the purchase price.” Id. at 8. R&R Auction claims that Johnson breached the implied covenant of good faith and fair dealing by declining to comply with that provision, and instead filing suit in California. Id. at 54-55. For the sake of argument, I assume that R&R Auction has satisfied the relatedness and purposeful availment requirements as to this claim. 22 first two prongs have been established, but will often tip
against exercising jurisdiction when the other factors are
weak.” GT Solar, Inc. v. Goi, 2009 DNH 156, 25 (internal
citations omitted).
1. Defendant’s Burden of Appearance
Although litigating this matter in New Hampshire would
present some burden for Johnson – a California resident who has
reportedly never visited New Hampshire - his circumstances are
not unusual. See Sawtelle, 70 F.3d at 1395 (“this factor
becomes meaningful only where a party can demonstrate a ‘special
or unusual burden’”) (punctuation omitted); but see
Ticketmaster, 26 F.3d at 210 (concluding that the burden of
litigating in a distant forum, “and its inevitable concomitant,
great inconvenience, are entitled to substantial weight”). As
the First Circuit has explained, however, the “burden of
appearance” factor is important primarily because “it provides a
mechanism through which courts may guard against harassment.”
Ticketmaster, 26 F.3d at 211; see Nowak v. Tak How Investments,
Ltd., 94 F.3d 708, 718 (1st Cir. 1996). In this case, “the
circumstances . . . suggest that the inconvenience to the
defendant may not be coincidental.” Ticketmaster, 26 F.3d at
210-11.
Since 2012, Johnson and R&R Auction have been engaged in
increasingly unfriendly litigation in California state court, a
23 lawsuit that R&R Auction has described as “extortion by
litigation.” Doc. No. 28-3 at 2. Virtually all of R&R
Auction’s claims here flow from Johnson’s actions in that
lawsuit. R&R Auction’s unfair competition claim, for instance,
stems in part from Johnson “making overreaching settlement
demands” and “cancelling his deposition numerous times without
good cause” in that suit. Doc. No. 1 at 51-52. The abuse of
process claim is based upon Johnson serving a subpoena in the
course of the California lawsuit, id. at 60, while the good
faith and fair dealing claim arises from the same events –
namely Johnson’s refusal to accept a refund for reportedly
knockoff items – that gave rise to Johnson’s lawsuit in the
first place. Id. at 54-55. Yet, rather than resolving those
grievances through the ongoing suit, or in nearby federal court,
R&R Auction filed this action 3,000 miles away. Given that
history, this factor cuts against jurisdiction.
2. Interest of the Forum
Because New Hampshire “has a demonstrable interest in
obtaining jurisdiction over a defendant who causes tortious
injury within its borders,” Sawtelle, 70 F.3d at 1395, this
factor favors R&R Auction. This interest is “milder than usual”
here, however, in light of two factors. Ticketmaster, 26 F.3d
at 211. First, New Hampshire’s “interest in the litigation sub
judice is arguably lessened by the doubts surrounding whether
24 [the] defendant's act can be said to have been committed in the
forum.” Id. As explained above, Johnson committed the
challenged acts outside of New Hampshire, which diminishes New
Hampshire’s interest in this suit. Second, the appearance that
R&R Auction may have filed this action, or chosen to file in New
Hampshire, to retaliate against Johnson decreases New
Hampshire’s interest. Id. Accordingly, I assign this factor
little weight.
3. Plaintiff’s Convenience
R&R Auction’s “choice of forum must be accorded a degree of
deference with respect to the issue of its own convenience.”
Sawtelle, 70 F.3d at 1395. R&R Auction is a New Hampshire
company, and presumably many of its witnesses are New Hampshire
residents. Yet, virtually all of the relevant events occurred
in California, many witnesses are located there, and R&R Auction
has already been defending Johnson’s closely-related lawsuit in
California for several years. As such, R&R Auction’s “actual
convenience seems to be at best a makeweight in this situation.”
Ticketmaster, 26 F.3d at 211 (emphasis in original).
4. Administration of Justice
In most cases, the judicial system’s interest in obtaining
effective resolution to a given suit will not favor either side
in a personal jurisdiction dispute. See PC Connection, Inc. v.
Crabtree, 754 F. Supp. 2d 317, 334 (D.N.H. 2010). In this case,
25 though, two factors favor Johnson: (1) “the possibility that
plaintiff’s action might be thought vexatious,” Ticketmaster, 26
F.3d at 211; and (2) the likelihood that R&R Auction could
resolve some of its claims in the ongoing California litigation
before a judge who is already familiar with many of the issues
raised.
5. Pertinent Policy Arguments
No additional fundamental social policies counsel for
jurisdiction in either New Hampshire or California. See
Ticketmaster, 26 F.3d at 211-12 (placing “no weight on First
Amendment values” for purposes of jurisdictional analysis).
This factor is therefore neutral.
D. Summary
In conclusion, this case presents a close question as to
whether specific jurisdiction exists. Although R&R Auction has
proffered (barely) enough evidence to satisfy the relatedness
and purposeful availment requirements as to some of its claims,
the reasonableness requirements – and the appearance of possible
harassment in particular – cuts strongly against jurisdiction.
Therefore, after weighing the gestalt factors with the relative
weakness of R&R Auction’s showings on the first two
requirements, I conclude that R&R Auction has not met its burden
of proving personal jurisdiction with respect to any of its
26 claims.7 Because exercising specific jurisdiction under the
facts presented here would be unreasonable, I grant Johnson’s
motion to dismiss.8
IV. CONCLUSION For the reasons set forth above, defendant’s motion to
dismiss for lack of personal jurisdiction (Doc. No. 13) is
granted. I deny as moot and without prejudice defendant’s
motion to dismiss for improper venue, or to transfer venue
(id.), and plaintiff’s motion for preliminary injunctive relief
(Doc. No. 2).
SO ORDERED.
/s/ Paul Barbadoro___ Paul Barbadoro United States District Judge
March 2, 2016 7 Even assuming that R&R Auction had satisfied the relatedness and purposeful availment requirements as to its first two categories of claims, I would decline to exercise jurisdiction over those claims for the same reasons that I decline to exercise jurisdiction over the remaining claims. 8 Because R&R Auction has not carried its burden of proving jurisdiction, I need not address Johnson’s venue argument in detail. I note, however, that, even if R&R Auction had proved personal jurisdiction, it would be appropriate to transfer this matter to the Central District of California pursuant to 28 U.S.C. § 1404(a). “Section 1404(a) is intended to place discretion in the district court to adjudicate motions for transfer according to an individualized, case-by-case consideration of convenience and fairness.” Astro–Med, 591 F.3d at 12 (internal punctuation omitted). For essentially the same reasons explained with respect to the gestalt factors, above, I would exercise that discretion here to transfer this matter. 27 cc: Lawrence P. Murray, Esq. Zachary Rush Gates, Esq. Timothy John McLaughlin, Esq. Matthew M. Clarke, Esq.