Sapieyevski v. Live Nation Worldwide, Inc.

• Court: District Court, District of Columbia
• Decided: July 31, 2020
• Docket: Civil Action No. 2018-0830
• Status: Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

JERZY SAPIEYEVSKI,

Plaintiff,

v. Civil Action No. 18-cv-830 (TJK)

LIVE NATION WORLDWIDE, INC. et al.,

Defendants.

MEMORANDUM OPINION

Plaintiff Jerzy Sapieyevski, proceeding pro se, sues Live Nation Worldwide, Inc., Live

Nation Entertainment, Inc., Hilton Worldwide Holdings, Inc., and Spotify USA, Inc., alleging

trademark infringement and unfair competition. Hilton moves to dismiss for lack of personal

jurisdiction. For the reasons explained below, the Court will grant Hilton’s motion.

Background

Sapieyevski alleges that Defendants infringed on his trademark, MUSICHAPPENS, by

using the mark MUSIC HAPPENS HERE to promote an “integrated program . . . celebrating

travel through music.” ECF No. 36, Second Amended Complaint (“SAC”) ¶ 27. The Court

assumes familiarity with the details of his allegations and the background of this case as set forth

in its previous opinion granting in part and denying in part Live Nation Worldwide’s motion to

dismiss, Sapieyevski v. Live Nation Worldwide, Inc., No. 18-cv-830 (TJK), 2019 WL 1284302

(D.D.C. Mar. 20, 2019) and its order granting Sapieyevski’s motion for leave to amend his

complaint, ECF No. 25. The Court granted Sapieyevski’s second motion to amend in November

2019, adding Hilton Worldwide Holdings, Inc. (“Hilton”) and Spotify USA, Inc. as defendants. 1

1 Spotify has not answered Sapieyevski’s complaint or appeared in this action. Now, Hilton moves to dismiss Sapieyevski’s Second Amended Complaint against it pursuant to

Federal Rule of Civil Procedure 12(b)(2). See ECF No. 52 (“MTD”). Sapieyevski opposes.

ECF No. 53 (“Opp’n”).

Legal Standard

Under Rule 12(b)(2), the plaintiff bears the burden of making a “prima facie showing of

the pertinent jurisdictional facts” to establish personal jurisdiction. Md. Dig. Copier v. Litig.

Logistics, Inc., 394 F. Supp. 3d 80, 86 (D.D.C. 2019) (quoting Livnat v. Palestinian Auth., 851

F.3d 45, 56–57 (D.C. Cir. 2017)). Conclusory statements are not enough to satisfy this burden—

“the plaintiff ‘must allege specific acts connecting [each] defendant with the forum.’” IMAPizza,

LLC v. At Pizza Ltd., 334 F. Supp. 3d 95, 107–08 (D.D.C. 2018) (quoting Second Amendment

Found. v. U.S. Conference of Mayors, 274 F.3d 521, 524 (D.C. Cir. 2001)). When evaluating a

12(b)(2) motion, “the Court is not limited to the four corners of the operative complaint, [and]

‘may receive and weigh affidavits and other relevant matter to assist in determining jurisdictional

facts.’” Xie v. Sklover & Co., LLC, 260 F. Supp. 3d 30, 37 (D.D.C. 2017) (quoting Khatib v. All.

Bankshares Corp., 846 F. Supp. 2d 18, 26 (D.D.C. 2012)). The Court must resolve factual

disputes in favor of the plaintiff, but it is not required to accept inferences unsupported by the

facts. IMAPizza, 334 F. Supp. 3d at 108.

Analysis

Personal jurisdiction is “‘an essential element of the jurisdiction a district court,’ without

which the court is ‘powerless to proceed to an adjudication.’” Id. at 109 (quoting Ruhrgas AG v.

Marathon Oil Co., 526 U.S. 574, 584 (1999)). Essentially, Hilton argues that Sapieyevski sued

the wrong Hilton entity. Hilton argues that this Court has no jurisdiction over it, that it was not

involved in any of the events alleged in the complaint, and that another entity—Hilton Honors

Worldwide, LLC (“Hilton Honors”)—may instead be the appropriate party. MTD at 1, 8. In his

2 opposition, Sapieyevski argues that the Court should rely on the contacts of Hilton’s subsidiary,

Hilton Honors, to establish personal jurisdiction. See Opp’n at 6–7. The Court agrees with

Hilton that it is not subject to personal jurisdiction in the District of Columbia and that Hilton

Honors’ contacts cannot be imputed to it.

A. General Jurisdiction

This Court may exercise general jurisdiction over Hilton only if Sapieyevski can show

that Hilton is “fairly regarded as at home” in the District of Columbia. Goodyear Dunlop Tires

Operations, S.A. v. Brown, 564 U.S. 915, 924 (2011). A corporation is considered “at home” in

its “place of incorporation and principal place of business.” Daimler AG v. Bauman, 571 U.S.

117, 137 (2014). But Hilton is incorporated in Delaware and has its principal place of business

in Virginia. ECF No. 52-1 (“Smith Decl.”) ¶ 6; SAC ¶ 11 (“The company is headquartered in

McLean, VA.”).

Sapieyevski argues that the Court can still assert jurisdiction because Hilton engages in

“continuous and systematic” activities in the District to “solicit[] business” from District

residents and “cultivate[] [District] investors to purchase Hilton’s stock.” Opp’n at 4. But

continuous and systematic activity alone is not enough to support general jurisdiction—the

activity must be so substantial as to render it “essentially at home in the forum State.” Daimler,

571 U.S. at 138–39 (quotation omitted). Hilton denies engaging in continuing and systematic

business within the District because it is not licensed to do business in the District, does not own

or operate hotels in the District, and does not regularly transact business here. Smith Decl. ¶¶ 9,

11–12, 14–15.

Even drawing all inferences in favor of Sapieyevski, the activities he alleges Hilton

engages in are not enough to confer general jurisdiction over Hilton. Sapieyevski claims that

Hilton’s promotional efforts constitute sufficient contacts with the District to confer general

3 jurisdiction because it targets District residents and investors. See Opp’n at 4. But advertising

and cultivating professional relationships within the District are not substantial enough activity to

render Hilton “essentially at home” in the District for purposes of general jurisdiction. See

Bigelow v. Garrett, 299 F. Supp. 3d 34, 42–43 (D.D.C. 2018) (finding that making payments for

advertising and maintaining professional relationships is insufficient for general jurisdiction).

Because Sapieyevski has failed to meet his burden of making a prima facie showing that Hilton

is “at home” in the District, this Court cannot exercise general jurisdiction over Hilton.

B. Specific Jurisdiction

Federal courts may exercise specific jurisdiction only when a suit “aris[es] out of or

relates[s] to the defendant’s contacts to the forum.” Goodyear, 564 U.S. at 923–24 (quoting

Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 n.8 (1984)) (alterations in

original). To establish specific jurisdiction, Sapieyevski must show “that jurisdiction is proper

under both (1) the District of Columbia’s long-arm statute and (2) the U.S. Constitution’s Due

Process Clause.” IMAPizza, 334 F. Supp. 3d at 110. Because Sapieyevski fails to show that

jurisdiction is proper under the long-arm statute, this Court cannot exercise specific jurisdiction

over Hilton.

Sapieyevski argues the Court has specific jurisdiction over Hilton because of its

collaboration with Live Nation to advertise and build a customer base in the District of Columbia

through “joint public statements, press releases, activities, and their deliberately integrated

business model.” Opp’n at 2. Hilton denies any involvement in the alleged events giving rise to

this suit and suggests a separate entity—Hilton Honors—is the party Sapieyevski should have

added. See Smith Decl. ¶¶ 7–8. In response, Sapieyevski claims Hilton Honors is not a separate

entity and that its contacts should be treated as Hilton’s for the purposes of specific jurisdiction

4 because Hilton Honors is “de facto a Hilton controlled agency/service, listed along Hilton with

the same McLean address, domain, and logo.” Opp’n at 5.

Piercing the corporate veil requires a strong showing that a subsidiary acts as an “alter

ego” of the parent company, Diamond Chem. Co. v. Atofina Chems., Inc., 268 F. Supp. 2d 1, 7

(D.D.C. 2003), and Sapieyevski has not met this heavy burden. To prevail, Sapieyevski must

show that “the parent corporation so dominated the subsidiary corporation as to negate its

separate personality, making the exercise of jurisdiction over the absent parent fair and

equitable.” Leitner-Wise v. Clark, No. 18-cv-771 (BAH), 2018 WL 6787999, at *4 (D.D.C. Dec.

26, 2018) (cleaned up). When making this determination, courts should consider: “(1) the nature

of the corporate ownership and control; (2) failure to maintain corporate minutes or adequate

records; (3) failure to maintain the corporate formalities; (4) a commingling of funds and other

assets; (5) diversion of corporate funds or assets to other uses; and (6) use of the same office of

business location.” IMark Mktg. Servs., LLC v. Geoplast S.p.A., 753 F. Supp. 2d 141, 150

(D.D.C. 2010). And even if a plaintiff succeeds, he must also show that “an adherence to the

fiction of the separate existence of the corporation would sanction a fraud or promote injustice.”

Diamond Chem., 268 F. Supp. 2d at 7 (quoting Camacho v. 1440 R.I. Ave. Corp., 620 A.2d 242,

248–49 (D.C. 1993)).

Sapieyevski fails to address most of the relevant factors and only asserts that both entities

use “the same . . . address, domain, and logo,” share a “PR corporate representative,” and serve

the interests of Hilton. Opp’n at 4–5. Sharing an address, marketing image, and management

employee does not satisfy Sapieyevski’s heavy burden. See IMark, 753 F. Supp. 2d at 151

(holding a unified marketing image is relevant but “[does] not independently render the entities

alter egos”); Diamond Chem., 268 F. Supp. 2d at 9 (holding shared executives insufficient to

5 establish as alter ego); Estate of Raleigh v. Mitchell, 947 A.2d 464, 471 (D.C. 2008) (holding

property ownership insufficient to establish as alter ego). Further, Sapieyevski makes no

argument about why it would be a fraud or injustice to treat Hilton and Hilton Honors as separate

entities. See Diamond Chem., 268 F. Supp. 2d at 7. For instance, Sapieyevski provides no

reason why he could not have simply sued Hilton Honors.

Having failed to establish Hilton Honors as an alter ego of Hilton, Sapieyevski must rely

only on Hilton’s contacts with the District to establish specific jurisdiction under the long-arm

statute and Due Process Clause. The District of Columbia long-arm statute provides for

“personal jurisdiction over a person, who acts directly or by an agent, as to a claim for relief

arising from the person’s”:

(1) transacting any business in the District of Columbia;

*** (3) causing tortious injury in the District of Columbia by an act or omission in the District of Columbia; [or] (4) causing tortious injury in the District of Columbia by an act or omission outside the District of Columbia if he regularly does or solicits business, engaged in any other persistent course of conduct, or derives substantial revenue from goods used or consumed, or services rendered, in the District of Columbia[.]

D.C. Code § 12-423(a)(1)-(4). A plaintiff must identify which provision of the long-arm statute

he relies on as the basis for specific jurisdiction. See FC Inv. Group LC v. IFX Markets, 529

F.3d 1087, 1095–96 (D.C. Cir. 2008).

Sapieyevski fails to clearly invoke any of these provisions in his argument for specific

jurisdiction. Even so, he cannot establish specific jurisdiction over Hilton under any of them.

First, the Court cannot exercise jurisdiction under subsection (a)(1) because Hilton does not

transact business in the District. Smith Decl. ¶¶ 9–16. Second, subsection (a)(3) does not apply

6 because Hilton was not the party involved in the alleged events giving rise to Sapieyevski’s

injury. Id. ¶¶ 7–8. Finally, Hilton has no regular business, persistent course of conduct, or

substantial revenue from the District that would support specific jurisdiction under subsection

(a)(4). Id. ¶¶ 9–16. Without “alleg[ing] some specific facts” that Hilton purposefully availed

itself by “invok[ing] the benefits and protections of the laws of the District of Columbia,”

Sapieyevski cannot establish specific jurisdiction under the long-arm statute. Bigelow, 299

F. Supp. 3d at 44.

Conclusion

For all of the above reasons, Hilton’s Motion to Dismiss, ECF No. 52, will be granted. A

separate order will issue.

/s/ Timothy J. Kelly TIMOTHY J. KELLY United States District Judge

Date: July 31, 2020