UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE
Thomas H. Saliba
v. Civil No. 18-cv-498-JD Opinion No. 2018 DNH 164 Greenfield, Stein & Senior, LLP
O R D E R
Thomas H. Saliba brought suit in state court against a law
firm, Greenfield, Stein & Senior, LLP, (“GSS”) challenging the
firm’s decision to retain money, in escrow, to cover its fees.
The firm removed the case to this court and moved to dismiss the
case for lack of personal jurisdiction or alternatively based on
a forum selection clause. Saliba objects to the motion.
I. Background
Thomas Saliba lives in New Hampshire. He was named as a
co-trustee of the Edwin P. Twombly, Jr. Trust. Ralph E. Lerner
was also a co-trustee. Saliba hired GSS, a law firm in New York
City, to represent the Trust in April of 2013, and both Saliba
and Lerner, as co-trustees, signed the engagement letter to GSS.
In 2014, another co-trustee brought a legal action seeking
to remove Saliba and Lerner as trustees. GSS was hired and
agreed to represent the Trust in that litigation. Saliba and
Lerner retained personal counsel to represent them in the
litigation. GSS represents that there were several disputes involving the Trust and the co-trustees and beneficiaries. The
litigation of the disputes occurred in New York Surrogate’s
Court, New York County.
The parties to the litigation entered a settlement
agreement in 2018 to resolve all of the disputes. Under the
terms of the agreement, Saliba and Lerner were to be paid an
agreed amount for their services to the Trust in exchange for
their resignation from and renunciation of their positions as
co-trustees. In paragraph 10 of the agreement, Lerner was
authorized to pay $3,650,000.00 to GSS “as attorneys for
[Lerner] and [Saliba] which shall be disbursed to [Lerner] and
[Saliba] upon the effective date of their Resignation and
Renunciation pursuant to paragraph 12, and (2).” Doc. 6-3, at
10-11.
The funds were paid to GSS as provided in the agreement.
GSS paid Saliba just over $1,700,000.00 of the money from the
Trust but retained $116,851.07 in an escrow account. GSS sent
Saliba an invoice and letters to have him agree that GSS could
retain the withheld money to pay its outstanding balance for
legal services. Saliba contends that GSS only represented the
Trust and did not represent him. For that reason, he contends
that he does not owe GSS for its fees and that GSS is required
to pay him the money it has retained.
2 II. Personal Jurisdiction
A party may move to dismiss an action for lack of personal
jurisdiction. Fed. R. Civ. P. 12(b)(2). When no evidentiary
hearing is held on a motion challenging personal jurisdiction,
the court uses the prima facie standard, which requires the
plaintiff to provide evidence that if taken as true supports
personal jurisdiction. Scottsdale Capital Advisors Corp. v. The
Deal, LLC, 887 F.3d 17, 20 (1st Cir. 2018).
To meet that burden, the plaintiff cannot rely on the
allegations in the complaint but instead must submit evidence to
show jurisdictional facts. A Corp. v. All Am. Plumbing, Inc.,
812 F.3d 54, 58 (1st Cir. 2016). Then, the court accepts the
properly supported facts as true and construes them in the light
most favorable to finding that jurisdiction exists. Id.
Evidence presented by the defendants may be considered only to
the extent it is undisputed. Id.
In a diversity jurisdiction case, such as this one,
personal jurisdiction exists to the extent allowed under the Due
Process Clause of the Fourteenth Amendment and the forum state’s
long-arm statute. Baskin-Robbins Franchising LLC v. Alpenrose
Dairy, Inc., 825 F.3d 28, 34 (1st Cir. 2016). New Hampshire’s
individual long-arm statute, RSA 510:4, authorizes jurisdiction
over foreign defendants to the full extent of the statutory
language and the Due Process Clause. N. Laminate Sales, Inc. v.
3 Davis, 403 F.3d 14, 24 (1st Cir. 2005); Allstate Property &
Casualty Ins. Co. v. Grohe Canada, Inc., 2018 DNH 032, 2018 WL
851351, at *2 (D.N.H. Feb. 13, 2018). Because the long-arm
statute is coextensive with federal due process, only the due
process requirements need to be addressed. Scottsdale Capital
Advisors Corp. v. Deal, LLC, 2017 WL 2981243, at *1 (D.N.H.
Sept. 8, 2017) (aff’d 887 F.3d 17 (1st Cir. 2018)).
Personal jurisdiction may be general or specific. Bluetarp
Fin., Inc. v. Matrix Constr. Co., Inc., 709 F.3d 72, 79 (1st
Cir. 2013). Saliba contends that the court is authorized to
exercise specific personal jurisdiction over GSS because of
GSS’s efforts directed to him in New Hampshire to collect its
fees from him personally. Specific personal jurisdiction exists
when (1) the plaintiff’s claim “directly arises out of or
relates to the defendant’s forum-state activities; (2) the
defendant’s contacts with the forum state represent a purposeful
availment of the privilege of conducting activities in that
state, . . . ; and (3) the exercise of jurisdiction is
ultimately reasonable.” Scottsdale, 887 F.3d at 20. The
primary focus for determining whether personal jurisdiction
exists is “the defendant’s relationship to the forum State.”
Bristol-Myers Squibb Co. v. Superior Court of Cal., San
Francisco County, 137 S. Ct. 1773, 1779 (2017).
4 A. Relatedness
The nature of the plaintiff’s claims directs the analysis
for purposes of determining relatedness. Phillips Exeter Acad.
V. Howard Phillips Fund, 196 F.3d 284, 289 (1st Cir. 1999). For
tort claims, the court considers whether “the plaintiff has
established cause in fact (i.e., the injury would not have
occurred but for the defendant’s forum-state activity) and legal
cause (i.e., the defendant’s in-state conduct gave birth to the
cause of action).” Scottsdale, 887 F.3d at 20-21 (internal
quotation marks omitted). For contract claims, the court
considers “whether the defendant’s activity in the forum state
was instrumental either in the formation of the contract or its
breach.” Phillips v. Prairie Eye Ctr., 530 F.3d 22, 27 (1st
Cir. 2008) (internal quotation marks omitted); see also Gulf Oil
Ltd. P’ship v. Petroleum Mktg. Gr., Inc., 308 F. Supp. 3d 453,
459-61 (D. Mass. 2018) (emphasizing that relatedness depends on
the defendant’s actions, not where an injury was felt).
Free access — add to your briefcase to read the full text and ask questions with AI
UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE
Thomas H. Saliba
v. Civil No. 18-cv-498-JD Opinion No. 2018 DNH 164 Greenfield, Stein & Senior, LLP
O R D E R
Thomas H. Saliba brought suit in state court against a law
firm, Greenfield, Stein & Senior, LLP, (“GSS”) challenging the
firm’s decision to retain money, in escrow, to cover its fees.
The firm removed the case to this court and moved to dismiss the
case for lack of personal jurisdiction or alternatively based on
a forum selection clause. Saliba objects to the motion.
I. Background
Thomas Saliba lives in New Hampshire. He was named as a
co-trustee of the Edwin P. Twombly, Jr. Trust. Ralph E. Lerner
was also a co-trustee. Saliba hired GSS, a law firm in New York
City, to represent the Trust in April of 2013, and both Saliba
and Lerner, as co-trustees, signed the engagement letter to GSS.
In 2014, another co-trustee brought a legal action seeking
to remove Saliba and Lerner as trustees. GSS was hired and
agreed to represent the Trust in that litigation. Saliba and
Lerner retained personal counsel to represent them in the
litigation. GSS represents that there were several disputes involving the Trust and the co-trustees and beneficiaries. The
litigation of the disputes occurred in New York Surrogate’s
Court, New York County.
The parties to the litigation entered a settlement
agreement in 2018 to resolve all of the disputes. Under the
terms of the agreement, Saliba and Lerner were to be paid an
agreed amount for their services to the Trust in exchange for
their resignation from and renunciation of their positions as
co-trustees. In paragraph 10 of the agreement, Lerner was
authorized to pay $3,650,000.00 to GSS “as attorneys for
[Lerner] and [Saliba] which shall be disbursed to [Lerner] and
[Saliba] upon the effective date of their Resignation and
Renunciation pursuant to paragraph 12, and (2).” Doc. 6-3, at
10-11.
The funds were paid to GSS as provided in the agreement.
GSS paid Saliba just over $1,700,000.00 of the money from the
Trust but retained $116,851.07 in an escrow account. GSS sent
Saliba an invoice and letters to have him agree that GSS could
retain the withheld money to pay its outstanding balance for
legal services. Saliba contends that GSS only represented the
Trust and did not represent him. For that reason, he contends
that he does not owe GSS for its fees and that GSS is required
to pay him the money it has retained.
2 II. Personal Jurisdiction
A party may move to dismiss an action for lack of personal
jurisdiction. Fed. R. Civ. P. 12(b)(2). When no evidentiary
hearing is held on a motion challenging personal jurisdiction,
the court uses the prima facie standard, which requires the
plaintiff to provide evidence that if taken as true supports
personal jurisdiction. Scottsdale Capital Advisors Corp. v. The
Deal, LLC, 887 F.3d 17, 20 (1st Cir. 2018).
To meet that burden, the plaintiff cannot rely on the
allegations in the complaint but instead must submit evidence to
show jurisdictional facts. A Corp. v. All Am. Plumbing, Inc.,
812 F.3d 54, 58 (1st Cir. 2016). Then, the court accepts the
properly supported facts as true and construes them in the light
most favorable to finding that jurisdiction exists. Id.
Evidence presented by the defendants may be considered only to
the extent it is undisputed. Id.
In a diversity jurisdiction case, such as this one,
personal jurisdiction exists to the extent allowed under the Due
Process Clause of the Fourteenth Amendment and the forum state’s
long-arm statute. Baskin-Robbins Franchising LLC v. Alpenrose
Dairy, Inc., 825 F.3d 28, 34 (1st Cir. 2016). New Hampshire’s
individual long-arm statute, RSA 510:4, authorizes jurisdiction
over foreign defendants to the full extent of the statutory
language and the Due Process Clause. N. Laminate Sales, Inc. v.
3 Davis, 403 F.3d 14, 24 (1st Cir. 2005); Allstate Property &
Casualty Ins. Co. v. Grohe Canada, Inc., 2018 DNH 032, 2018 WL
851351, at *2 (D.N.H. Feb. 13, 2018). Because the long-arm
statute is coextensive with federal due process, only the due
process requirements need to be addressed. Scottsdale Capital
Advisors Corp. v. Deal, LLC, 2017 WL 2981243, at *1 (D.N.H.
Sept. 8, 2017) (aff’d 887 F.3d 17 (1st Cir. 2018)).
Personal jurisdiction may be general or specific. Bluetarp
Fin., Inc. v. Matrix Constr. Co., Inc., 709 F.3d 72, 79 (1st
Cir. 2013). Saliba contends that the court is authorized to
exercise specific personal jurisdiction over GSS because of
GSS’s efforts directed to him in New Hampshire to collect its
fees from him personally. Specific personal jurisdiction exists
when (1) the plaintiff’s claim “directly arises out of or
relates to the defendant’s forum-state activities; (2) the
defendant’s contacts with the forum state represent a purposeful
availment of the privilege of conducting activities in that
state, . . . ; and (3) the exercise of jurisdiction is
ultimately reasonable.” Scottsdale, 887 F.3d at 20. The
primary focus for determining whether personal jurisdiction
exists is “the defendant’s relationship to the forum State.”
Bristol-Myers Squibb Co. v. Superior Court of Cal., San
Francisco County, 137 S. Ct. 1773, 1779 (2017).
4 A. Relatedness
The nature of the plaintiff’s claims directs the analysis
for purposes of determining relatedness. Phillips Exeter Acad.
V. Howard Phillips Fund, 196 F.3d 284, 289 (1st Cir. 1999). For
tort claims, the court considers whether “the plaintiff has
established cause in fact (i.e., the injury would not have
occurred but for the defendant’s forum-state activity) and legal
cause (i.e., the defendant’s in-state conduct gave birth to the
cause of action).” Scottsdale, 887 F.3d at 20-21 (internal
quotation marks omitted). For contract claims, the court
considers “whether the defendant’s activity in the forum state
was instrumental either in the formation of the contract or its
breach.” Phillips v. Prairie Eye Ctr., 530 F.3d 22, 27 (1st
Cir. 2008) (internal quotation marks omitted); see also Gulf Oil
Ltd. P’ship v. Petroleum Mktg. Gr., Inc., 308 F. Supp. 3d 453,
459-61 (D. Mass. 2018) (emphasizing that relatedness depends on
the defendant’s actions, not where an injury was felt).
In this case, Saliba seeks a declaratory judgment that he
is entitled to the $116,851.07 that GSS is holding in escrow as
payment for its legal services. Saliba also alleges that GSS is
wrongfully withholding the money in violation of RSA chapter
358-A (New Hampshire’s Consumer Protection Act), and alleges
that GSS has breached its fiduciary duty as an escrow agent.
5 Saliba contends that his claims do not raise a contract
issue. GSS relies on the relatedness analyses in Sawtelle v.
Farrell, 70 F.3d 1381, 1389 (1st Cir. 1995), which involved a
legal malpractice claim, and Dagesse v. Law Firm of Esperti,
Peterson & Cahoone, 2003 WL 22871700, at *4-*5 (D.N.H. Dec. 4,
2003), which involved a contract claim and a legal malpractice
claim. As alleged, Saliba does not claim that a contract
existed between himself and GSS or that GSS breached a contract.
Therefore, the claims are assessed under the tort standard for
relatedness.
Saliba argues that his claims arose from GSS’s letters and
emails to him, in New Hampshire, seeking to collect the disputed
fees from him. While those communications do address the issue
of fees, Saliba brought suit to recover the money that GSS is
holding as payment for its fees. In other words, the injury he
is seeking to redress is GSS’s failure to include the
$116,851.07 when it sent him his share of the settlement amount.
As such, Saliba’s claims arose from and are based on GSS’s
decision to withhold money from the settlement amount to pay its
fees.
The settlement money was delivered to GSS in New York. GSS
decided to retain $116,851.07 to pay its fees in New York.
GSS’s communications directed to Saliba in New Hampshire to
6 justify its claim to the money and to explain its decision were
not the cause in fact or the legal cause of Saliba’s claims.1
B. Purposeful Availment and Reasonableness
Because Saliba has not carried his burden to show that his
claims are related to GSS’s contacts with New Hampshire, it is
not necessary to consider the other two elements of specific
personal jurisdiction: purposeful availment and reasonableness.
Nevertheless, the court also concludes that Saliba has not shown
that GSS “purposefully avail[ed] itself of the privilege of
conducting activities within the forum State, thus invoking the
benefits and protections of its laws.” Hanson v. Denckla, 357
U.S. 235, 253 (1958). Even if an attorney-client relationship
had existed between Saliba and GSS, which Saliba denies, his
residency in New Hampshire is not enough to show personal
availment. See Sawtelle, 70 F.3d at 1392. Further, given GSS’s
location in New York and New York being the location of the
pertinent actions in this case, Saliba has not shown that it
would be reasonable to exercise jurisdiction over GSS in New
Hampshire. See A Corp., 812 F.3d at 61 (listing elements of
reasonableness inquiry).
1 The parties dispute whether Saliba was actually in New Hampshire when he received GSS’s communications. That issue need not be resolved because the communications, even if made to Saliba while he was in New Hampshire, were not the cause of the injury claimed by Saliba.
7 C. Forum Selection Clause
Because the court lacks personal jurisdiction over GSS, it
does not consider the argument that the case must be dismissed
based on the forum selection clause in the settlement agreement.
Conclusion
For the foregoing reasons, the defendant’s motion to
dismiss (document no. 6) is granted in that the case is
dismissed for lack of personal jurisdiction.
The clerk of court shall enter judgment accordingly and
close the case.
SO ORDERED
__________________________ Joseph A. DiClerico, Jr. United States District Judge
August 13, 2018
cc: Peter G. Callaghan, Esq. Megan C. Carrier, Esq. James F. Ogorchock, Esq.