STI Trucking, LLC v. Santa Rosa Operating, LLC

CourtDistrict Court, N.D. Oklahoma
DecidedFebruary 1, 2021
Docket4:20-cv-00073
StatusUnknown

This text of STI Trucking, LLC v. Santa Rosa Operating, LLC (STI Trucking, LLC v. Santa Rosa Operating, LLC) is published on Counsel Stack Legal Research, covering District Court, N.D. Oklahoma primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
STI Trucking, LLC v. Santa Rosa Operating, LLC, (N.D. Okla. 2021).

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF OKLAHOMA

STI TRUCKING, LLC, d/b/a STONE TRUCKING COMPANY,

Plaintiff, v. Case No. 20-cv-0073-JFH-CDL

SANTA ROSA OPERATING, LLC and SANTA ROSA DRILLING, LLC,

Defendants.

OPINION AND ORDER This matter is before the Court on the Motion to Dismiss for Lack of Personal Jurisdiction, filed by Defendant Santa Rosa Operating, LLC (“SRO”). Dkt. No. 13. For the reasons set forth below, the motion is granted. I. BACKGROUND This case arises from a contract dispute between Plaintiff, STI Trucking, LLC d/b/a Stone Trucking Company (“STI”) and Defendants SRO and Santa Rosa Drilling, LLC (“SRD”).1 See generally Dkt. No. 8. STI is an oversize and heavy haul carrier. Id. at 2. SRO is an oil and gas exploration and operating company. Dkt. No. 8-2 at 5. SRO hired Advanced Hydrostatic Services, LLC (“Advanced”), a well service operation, to work on one of SRO’s wells in Texas. Dkt. No. 13-1 at 4. Advanced used STI to transport equipment in connection with its well service operation on SRO’s well. Id. Advanced requested that SRO pay STI directly for the transportation services to avoid Advanced having to re-bill the STI’s invoices through its own invoicing to SRO. Id. On

1 SRD’s name has changed. It is now operating as TTR Drilling, LLC. Dkt. No. 19-1 at 1. September 30, 2015, SRO submitted a credit application to STI in connection with services that STI would be providing for SRO. Id. at 3; Dkt. No. 8-2. The application was approved and STI created and maintained an “open account” for SRO whereby STI would deliver and provide oilfield goods and services on credit and SRO was to remit payment within thirty days of receiving STI’s

invoices. Dkt. No. 8-2; Dkt. No. 17-1 at 3; Dkt. No. 17-3. Under this arrangement, STI transported drilling rigs and related equipment for Advanced/SRO between September 2015 and June 2019.2 Id. STI began transporting drilling rigs and related equipment for SRD in June 2017. Dkt. No. 17-1 at 3; Dkt. No. 17-4; Dkt. 17-5; Dkt. No. 24 at 4. STI alleges that it did so at the request of SRO. Dkt. No. 17 at 8. STI understood that SRD was an affiliate of SRO and that it was providing services to SRD on credit under SRO’s account.3 Dkt. No. 8 at 2-3; Dkt. No. 17 at 8. STI

2 Invoices from STI reflect that transportation services were provided for Advanced/SRO on a regular basis from September 2015 through November 2017. Dkt. No. 17-3 at 1-65. There is one invoice for transportation services provided for Advanced/SRO in June 2019. Id. at 66-70. 3 While SRO disputes that it is affiliated with SRD, SRO and SRD share the same corporate address in Corpus Christi, Texas. Dkt. No. 8 at 1; Dkt. No. 24 at 1-2. Roger S. Braugh, Jr., who is the sole member and Manager of SRO, is also the President of SRD. Dkt. No. 13-1 at 1; Dkt. No. 19-1 at 1. Jonathan Floyd, who has served as Vice President and currently serves as Chief Operating Officer of SRO, is also the Chief Operating Officer of SRD. Dkt. No. 17-6 at 2; Dkt. No. 19-1 at 2. Mr. Floyd signed the original application for a credit account with STI on behalf of SRO, and STI alleges that he also signed all checks submitted on behalf of SRO and SRD. Dkt. No. 8-2 at 4; Dkt. No. 17-3; Dkt. No. 17-4. STI billed all SRD invoices under SRO’s credit account and payment was remitted by SRD without objection, until June 26, 2019, after payment of the past due balance on SRO’s credit account, which exceeded $270,000, was demanded. Dkt. No. 17-4; Dkt. No. 23-1 at 2, 4, 6-21. In a letter dated June 26, 2019, SRD requested that STI direct billing for SRD invoices to SRD, rather than to SRO. Dkt. No. 23-1 at 4. However, by that time, STI was no longer providing services to either SRO or SRD, as SRO’s credit account was frozen due to non-payment of the past due balance. Id. at 2. The Court is not persuaded that SRO clearly delineated a distinction between SRO and SRD. However, this issue need not be resolved for the purpose of the motion to dismiss. This Order does not address the merits of STI’s claims against SRO for liability on the outstanding invoices. transported drilling rigs and related equipment for SRD between June 2017 and May 2018. Dkt. No. 17-1 at 3; Dkt. No. 17-4; Dkt. 17-5; Dkt. No. 24 at 4. STI initiated this action on January 22, 2020, in the District Court of Tulsa County. Dkt. No. 2-3 at 1-5. The case was removed to this Court on February 21, 2020. Dkt. No. 2. STI filed

an amended complaint on February 27, 2020, alleging that, despite its demands, SRO and SRD have refused to pay fifteen invoices related to transportation services provided by STI and that the principal amount due on the invoices is $247,037. Dkt. No. 8 at 4; Dkt. No. 8-1. STI asserts claims for: (1) breach of contract; (2) collection upon an open account; (3) unjust enrichment; and (4) negligent misrepresentation. Dkt. No. 8 at 5-9. STI contends that venue is mandatory in this Court due to a forum selection clause that appears on each of its invoices. Id. at 2. SRO seeks dismissal of the claims against it pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure. Dkt. No. 13. SRO argues that the forum selection clause is unenforceable, and that SRO does not have sufficient minimum contacts with Oklahoma for the Court to exercise personal jurisdiction over it. Id. at 2-6; Dkt. No. 19 at 2-10.

II. STANDARD Motions to dismiss under Rule 12(b)(2) test the plaintiff’s theory of personal jurisdiction as well as the facts supporting personal jurisdiction. See Fed. R. Civ. P. 12(b)(2); Credit Lyonnais Sec. (USA), Inc. v. Alcantara, 183 F.3d 151, 153-54 (2d Cir. 1999) (holding that the court “must determine whether the defendant in fact subjected itself to the court’s jurisdiction”). “[W]hen the court’s jurisdiction is contested, the plaintiff has the burden of proving jurisdiction exists.” Wenz v. Memery Crystal, 55 F.3d 1503, 1505 (10th Cir.1995). Where jurisdiction is “decided on the basis of affidavits and other written materials, the plaintiff need only make a prima facie showing” of facts that would support the assertion of jurisdiction. Id. “The allegations in the complaint must be taken as true to the extent they are uncontroverted by the defendant’s affidavit.” Behagen v. Amateur Basketball Ass’n of U.S.A., 744 F.2d 731, 733 (10th Cir. 1984). However, upon a defendant’s presentation of credible evidence through affidavits or other materials suggesting the lack of personal jurisdiction, the plaintiff must come forward with sufficient evidence to create a

genuine dispute of material fact on the issue. See Doe v. Nat’l Med. Servs., 974 F.2d 143, 145 (10th Cir.1992). The Court will only weigh factual disputes in favor of the plaintiff if the plaintiff meets its burden of contesting the credible evidence presented by the defendant. See Wenz, 55 F.3d at 1505; Behagen, 744 F.2d at 733. III. DISCUSSION A. The Law Regarding Personal Jurisdiction 1. Burden of Proof For a court to exercise personal jurisdiction over a nonresident defendant in a diversity action, the plaintiff must demonstrate the existence of every fact required to satisfy both the forum’s long-arm statute and the Due Process Clause of the United States Constitution. See 12

O.S. § 2004(F); see Marcus Food Co. v. DiPanfilo, 671 F.3d 1159, 1166 (10th Cir.

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STI Trucking, LLC v. Santa Rosa Operating, LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sti-trucking-llc-v-santa-rosa-operating-llc-oknd-2021.