Schlesinger v. Collins

• Court: District Court, N.D. California
• Decided: September 25, 2019
• Docket: 3:19-cv-03483
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 BRIAN SCHLESINGER, Case No. 19-cv-03483-EMC

8 Plaintiff, ORDER DENYING DEFENDANT’S 9 v. MOTION TO DISMISS; AND GRANTING DEFENDANT’S MOTION 10 JOSHUA COLLINS, TO TRANSFER 11 Defendant. Docket No. 8

12 13 14 Plaintiff Brian Schlesinger has filed suit against Defendant Joshua Collins, doing business 15 as xpresscapitalgroup.com,1 asserting a violation of the federal Telephone Consumer Protection 16 Act (“TCPA”), see 47 U.S.C. § 227(b)(1)(A)(iii), and similar California law. See Cal. Civ. Code § 17 1770(a)(22)(A). According to Mr. Schlesinger, Mr. Collins violated these statutes because he, or 18 another person acting on his behalf, called Mr. Schlesinger using an artificial or prerecorded voice 19 without Mr. Schlesinger’s prior express consent. Mr. Schlesinger seeks relief not only for himself 20 but also for a nationwide class (for the TCPA claim) and a California class (for the California 21 claim). Currently pending before the Court is Mr. Collins’s motion to dismiss or, in the 22 alternative, transfer. Having considered the papers submitted, the Court deems the matter suitable 23 for disposition without oral argument. The motion to dismiss is DENIED but the motion to 24 transfer – specifically, to the Middle District of Florida where Mr. Collins resides, see Compl. ¶ 25 10; Collins Decl. ¶ 1 – is GRANTED. 26

27 1 According to Mr. Collins, “Xpress Capital Group is a business offering business loans to 1 I. DISCUSSION 2 A. Personal Jurisdiction 3 1. Legal Standard 4 According to Mr. Collins, the instant case against him must be dismissed for lack of 5 personal jurisdiction. See Fed. R. Civ. P. 12(b)(2) (providing that a defendant may file a motion to 6 dismiss based on lack of personal jurisdiction).

7 Where, as here, there is no applicable federal statute governing personal jurisdiction, the district court applies the law of the state in 8 which the district court sits. Because California's long-arm jurisdictional statute is coextensive with federal due process 9 requirements, the jurisdictional analyses under state law and federal due process are the same. For a court to exercise personal 10 jurisdiction over a nonresident defendant, that defendant must have at least "minimum contacts" with the relevant forum such that the 11 exercise of jurisdiction "does not offend traditional notions of fair play and substantial justice." 12 13 Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800-01 (9th Cir. 2004). 14 The plaintiff bears the burden of establishing personal jurisdiction. See id. at 800. Where 15 a “motion is based on written materials rather than an evidentiary hearing, ‘the plaintiff need only 16 make a prima facie showing of jurisdictional facts.’” Id. “Although the plaintiff cannot ‘simply 17 rest on the bare allegations of its complaint,’ uncontroverted allegations in the complaint must be 18 taken as true”; in addition, “[c]onflicts between parties over statements contained in affidavits 19 must be resolved in the plaintiff’s favor.” Id. 20 2. Specific Jurisdiction 21 In support of his claim that there is no personal jurisdiction, Mr. Collins has submitted a 22 declaration. The bulk of that declaration is directed to his assertion that this Court lacks general 23 jurisdiction over him. See id. at 801 (stating that, “[f]or general jurisdiction to exist over a 24 nonresident defendant . . . , the defendant must engage in ‘continuous and systematic general 25 business contacts’ that ‘approximate physical presence’ in the forum state” – “an exacting 26 standard . . . because a finding of general jurisdiction permits a defendant to be haled into court in 27 the forum state to answer for any of its activities anywhere in the world”); Collins Decl. ¶¶ 2-13. 1 jurisdiction over Mr. Collins. Rather, Mr. Schlesinger argues only that there is specific 2 jurisdiction. 3 The Ninth Circuit has

4 a three-prong test for analyzing a claim of specific personal jurisdiction: 5 (1) The non-resident defendant must purposefully direct his 6 activities or consummate some transaction with the forum or resident thereof; or perform some act by which he purposefully 7 avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws; 8 (2) the claim must be one which arises out of or relates to the 9 defendant's forum-related activities; and

10 (3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e. it must be reasonable. 11 12 Id. at 802. With respect to the first prong, “[a] purposeful availment analysis is most often used in 13 suits sounding in contract” while “[a] purposeful direction analysis . . . is most often used in suits 14 sounding in tort.” Id. In the case at bar, Mr. Schelsinger is making essentially a tort claim, not a 15 contract claim. Therefore, the Court applies a purposeful direction analysis. 16 Purposeful direction is evaluated “under the three-part ‘effects’ test traceable to the 17 Supreme Court’s decision in Calder v. Jones, 465 U.S. 783 (1984).” Id. at 803. Under this test, a 18 defendant must have “‘(1) committed an intentional act, (2) expressly aimed at the forum state, (3) 19 causing harm that the defendant knows is likely to be suffered in the forum state.’” Id. 20 Here, Mr. Collins challenges only the second and third elements above – in particular, 21 disputing that he, or someone acting on his behalf, engaged in conduct expressly aimed at 22 California.2 In his declaration, Mr. Collins testifies that his website xpresscapitalgroup.com “does 23 not expressly or directly market to California residents.” Collins Decl. ¶ 14. He also testifies that 24 he obtained Mr. Schlesinger’s number by “purchas[ing] a lead from a third-party company out of 25 Bangladesh that maintains leads for persons seeking business loans throughout the United States. 26 The lead reflected a person identifying themselves as ‘John Smith’ was seeking a business loan for 27 1 a Herbalife company and the phone number listed was (415) 850-6760.” Collins Decl. ¶ 15. 2 “Based on this lead,” Mr. Collins – “through a third-party customer relationship management 3 company [–] had a third-party independent contractor located in Bangladesh make live calls to the 4 leads.” Collins Decl. ¶ 16. It was not until the lead was confirmed that Mr. Collins, or rather, his 5 employee, called Mr. Schlesinger. See Collins Decl. ¶ 18. 6 The problem for Mr. Collins is that, even if he did not act in a “premeditated” fashion – 7 i.e., plan in advance to target California – he (or someone acting on his behalf) ultimately did 8 target California, and with sufficient knowledge of such based on the California area code for Mr. 9 Schlesinger’s phone number. Under these circumstances, the second and third elements of the 10 Calder effects test have been sufficiently satisfied. See, e.g., Moser v. Health Ins. Innovations, 11 Inc., No. 3:17-cv-1127-WQH-KSC, 2018 U.S. Dist. LEXIS 3237, at *11 (S.D. Cal. Jan. 5, 2018) 12 (stating that “[t]he effects test is satisfied by a plaintiff’s uncontroverted allegation that a 13 defendant violated the TCPA by calling a phone number with a forum state area code”); Luna v. 14 Shac, LLC, No. C14-00607 HRL, 2014 U.S. Dist. LEXIS 96847, at *11 (N.D. Cal. July 14, 2014) 15 (“agree[ing] with [plaintiff] that where [defendant] intentionally sent text messages directly to cell 16 phones with California based area codes, which conduct allegedly violated the TCPA and gave 17 rise to this action, [defendant] expressly aimed its conduct at California” and also “knew that the 18 alleged harm caused by the text messages it sent to California cell phones was likely to be suffered 19 in California”); Branham v. ISI Alarms, Inc., No. 12-CV-1012 (ARR) (MDG), 2013 U.S. Dist. 20 LEXIS 124933, *28 (E.D.N.Y. Aug. 30, 2013) (holding that, “since ‘[t]he TCPA is essentially a 21 strict liability statute, which prohibits the use of any automatic dialing system or prerecorded or 22 artificial voice to a cell-phone, defendants reasonably should have anticipated that the use of such 23 a system to call a New York cell-phone number could subject them to being haled into court in 24 New York”); Heidorn v. BDD Marketing & Mgmt. Co., No. C-13-00229 JCS, 2013 U.S. Dist. 25 LEXIS 177166, at *3, *25 (N.D. Cal. Aug. 9, 2013) (finding personal jurisdiction in TCPA case 26 where calls were made to a California resident at a California number). Compare Abedi v. New 27 Age Med. Clinic PA, No. 1:17-CV-1618 AWI SKO, 2018 U.S. Dist. LEXIS 105932, at *11 (E.D. 1 indicates that [defendant] did not know that it was sending text messages into California”; “[o]f 2 critical importance, the cell phone number provided to [defendant] was for a non-California 3 number”). This is not a situation where the forum state was implicated only by “happenstance.” 4 Morrill v. Scott Financial Corp., 873 F.3d 1136, 1146 (9th Cir. 2017). Notably, in Morrill, the 5 Ninth Circuit discussed the underlying facts in Calder, explaining that, in that case, there was 6 specific jurisdiction largely because “the defendants published the allegedly defamatory 7 statements in the forum state.” Castillo v. Caesars Entm't Corp., No. 18-cv-05781-EMC, 2018 8 U.S. Dist. LEXIS 201721, at *10-11 (N.D. Cal. Nov. 28, 2018) (addressing Morrill’s discussion of 9 Calder). The instant case is analogous; there is specific jurisdiction because Mr. Collins, or 10 someone acting on his behalf, made a phone call to California. The TCPA cases finding 11 jurisdiction are consistent with Walden v. Fiore, 571 U.S. 277 (2014), because the defendant, as in 12 this case, targeted California telephone numbers (and presumably residents of California), 13 inflicting harm within this state. 14 Mr. Collins protests still that, even if there is purposeful direction, specific jurisdiction 15 obtains only where the exercise of such would be reasonable, and here it would be unreasonable – 16 e.g., his contacts with California were simply “fortuitous,” it would be a significant burden for him 17 (as a sole proprietor) to defend in this Court, California has an interest in the state law claim but 18 not the federal TCPA claim, and it would be more efficient to litigate in Florida where the bulk of 19 the witnesses and evidence are likely to be located. Mot. at 16-18. Although Mr. Collins’s 20 position is not entirely lacking in merit, the Court is not persuaded. Mr. Collins shoulders the 21 burden of proving that the exercise of jurisdiction would be unreasonable, and, under Ninth 22 Circuit law, must “‘present a compelling case’” of unreasonableness. Schwarzenegger, 374 F.3d 23 at 802. Here, given Mr. Collins knew he was making a call into California, Mr. Collins has not 24 met that high standard. 25 Accordingly, the Court denies the motion to dismiss based on lack of personal jurisdiction. 26 B. Venue 27 Mr. Collins also moves to dismiss based on improper venue. Title 28 U.S.C. § 1391 is the 1 A civil action may be brought in –

2 (1) a judicial district in which any defendant resides, if all defendants are residents of the State in which the district is 3 located;

4 (2) a judicial district in which a substantial part of the events or omissions giving rise to the claim occurred, or a substantial 5 part of property that is the subject of the action is situated; or

6 (3) if there is no district in which an action may otherwise be brought as provided in this section, any judicial district in 7 which any defendant is subject to the court’s personal jurisdiction with respect to such action. 8 9 13 U.S.C. § 1391(b). 10 In the instant case, Mr. Collins argues that “virtually all the actions taken in this matter 11 occurred in Florida,” where he resides. Mot. at 19. But even accepting that as true, that does not 12 mean that a substantial part of the events did not also take place in California where the phone call 13 was directed and where the harm was inflicted. See Mitrano v. Hawes, 377 F.3d 402, 405 (4th 14 Cir. 2004) (noting that “it is possible for venue to be proper in more than one judicial district”); 15 S.F. Residence Club, Inc. v. Leader Bulso & Nolan, PLC, No. C-13-0844 EMC, 2013 U.S. Dist. 16 LEXIS 68600, at *12 (N.D. Cal. May 14, 2013) (noting that “[s]ection 1391(b)(2) does not require 17 that a majority of the events have occurred in the district where suit is filed, nor does it require that 18 the events in that district predominate”; also, “[t]here may be more than one district in which a 19 substantial part of the events giving rise to the claim occurred”) (internal quotation marks 20 omitted); Kelly v. Qualitest Pharm., Inc., No. CIV- F-06-116 AWI LJO, 2006 U.S. Dist. LEXIS 21 65814, at *24-25 (E.D. Cal. Aug. 28, 2006) (indicating that, under subsection (2), all that is 22 required is that “‘significant events or omissions material to the plaintiff’s claim must have 23 occurred in the district in question’”). The Court therefore denies the motion to dismiss based on 24 improper venue. 25 C. Transfer 26 Finally, Mr. Collins argues that, even if the Court does not dismiss the instant case based 27 on lack of personal jurisdiction or improper venue, it should, at the very least, transfer the case to 1 part as follows: “For the convenience of parties and witnesses, in the interest of justice, a district 2 court may transfer any civil action to any other district or division where it might have been 3 brought or to any district or division to which all parties have consented.” 28 U.S.C. § 1404(a). 4 There is no dispute that Mr. Schlesinger could have brought his lawsuit in the Middle 5 District of Florida, where Mr. Collins resides. Therefore, the only question is whether there 6 should be a transfer to Florida for the convenience of the parties and witnesses and in the interest 7 of justice. 8 A district court has discretion in deciding whether to transfer. See Ventress v. Japan 9 Airlines, 486 F.3d 1111, 1118 (9th Cir. 2007) (stating that a "district court's decision to change 10 venue is reviewed for abuse of discretion"; adding that "'[w]eighing of the factors for and against 11 transfer involves subtle considerations and is best left to the discretion of the trial judge'"). In 12 making the decision on whether to transfer, a court may consider factors such as:

13 (1) plaintiffs' choice of forum, (2) convenience of the parties, (3) convenience of the witnesses, (4) ease of access to the evidence, (5) 14 familiarity of each forum with the applicable law, (6) feasibility of consolidation with other claims, (7) any local interest in the 15 controversy, and (8) the relative court congestion and time of trial in each forum. 16 17 Vu v. Ortho-Mcneil Pharm., Inc., 602 F. Supp. 2d 1151, 1156 (N.D. Cal. 2009) (Illston, J.). The 18 party moving for transfer has the burden in showing that transfer is appropriate. See Commodity 19 Futures Trading Comm'n v. Savage, 611 F.2d 270, 279 (9th Cir. 1979); S.F. Residence Club, Inc. 20 v. Leader Bulso & Nolan, PLC, No. C-13-0844 EMC, 2013 U.S. Dist. LEXIS 68600, at *22 (N.D. 21 Cal. May 14, 2013). 22 In the instant case, some of the above factors are neutral or largely neutral. For example: 23 • although California is a more convenient forum for Mr. Schlesinger, Florida is a 24 more convenient forum for Mr. Collins; 25 • California has an interest in protecting its residents (such as Mr. Schlesinger), 26 particularly where California law is implicated (but less so where only federal law 27 is implicated), but Florida also has an interest in regulating the conduct of its 1 • the courts in both California and Florida are familiar with the TCPA.3 2 As for the remaining factors, the critical ones in the instant case are the plaintiff’s choice of 3 forum, the ease of access to evidence, and the convenience of the witnesses. The Court does 4 afford some deference to Mr. Schlesinger’s choice of California as a forum, particularly as he 5 resides in California and at least a part of the events took place in California given that the phone 6 call at issue was placed to California. But that deference is limited because Mr. Schlesinger has 7 brought a putative class action that is nationwide in scope. See generally Castillo v. Caesars 8 Entm't Corp., No. 18-cv-05781-EMC, 2018 U.S. Dist. LEXIS 201721, at *15 (N.D. Cal. Nov. 28, 9 2018) (noting that, “although a plaintiff's choice of forum is typically afforded deference, such 10 deference is not owed where the plaintiff brings a class action, the plaintiff does not reside in the 11 forum, and/or no relevant action took place in the forum”). 12 With respect to ease of access to evidence, it seems unlikely that there will be any real 13 documentary evidence of note located in California. Rather, the bulk of the documentary evidence 14 will likely be in Florida, where Mr. Collins resides.4 “Athough the ease of electronic discovery 15 reduces the importance of this factor, ‘costs of litigation can still be substantially lessened if the 16 venue is in the district in which most of the documentary evidence is stored.’” United States ex 17 rel. Tutanes-Luster v. Broker Sols., Inc., No. 17-cv-04384-JST, 2019 U.S. Dist. LEXIS 34240, at 18 *18-19 (N.D. Cal. Mar. 4, 2019). 19 As for the convenience of the witnesses, Mr. Schlesinger does reside in California. But 20 Mr. Collins resides in Florida, he runs his business out of Florida, see Collins Decl. ¶ 2 (testifying 21 that the principal place of business for Xpress Capital Group is located in Florida), and the critical 22 issue in this case will be how he runs his business. Mr. Collins also appears to have at least one 23 employee, Michelle Borrego, who is based in Florida, see Collins Decl. ¶ 3 (testifying that Xpress 24 Capital Group “has no employees outside of Florida”), and it appears that Ms. Borrego was the 25

26 3 Although Mr. Schlesinger has also asserted an analogous California claim, the TCPA claim is the primary claim in the lawsuit given Mr. Schlesinger’s desire for certification of a nationwide class. 27 1 employee who called Mr. Schlesinger. See Collins Decl. | 18. Thus, the convenience-of-the- 2 || witnesses factor weighs strongly in Mr. Collins’s favor. See, e.g., Castillo, 2018 U.S. Dist. LEXIS 3 || 201721, at *16 (“The critical witnesses will be Caesars's employees — e.g., those who made the 4 || decision to send the text messages.”’). 5 Taking into account all of the above, including but not limited to the limited deference 6 || afforded to Mr. Schlesinger’s choice of forum, the Court concludes that a transfer to the Middle 7 District of Florida is warranted. 8 I. CONCLUSION 9 For the foregoing reasons, Mr. Collins’s motion to dismiss is denied but his motion to 10 || transfer is granted. The Clerk of the Court is instructed to transfer this case to the Middle District 11 of Florida in accordance with this opinion and close the file. 12 This order disposes of Docket No. 8.

IT IS SO ORDERED.

a 16 Dated: September 25, 2019

<4 ED M.C 19 United States District Judge 20 21 22 23 24 25 26 27 28