United States District Court, D. Arizona
Douglas L. Rayes United States District Judge.
Michael Entzminger filed this action in December 2016
alleging a number of claims arising from a real estate
investment gone awry. (Doc. 1.) Defendants Rex Baldwin (Rex)
and Blue Danube LC (Blue Danube) have moved to dismiss the
claims against them pursuant to Federal Rules of Civil
Procedure 12(b)(2) and (6). (Doc. 17.) The motion is fully
briefed and no party requested oral argument or an
evidentiary hearing. For the following reasons, the Court
finds that personal jurisdiction over Rex and Blue Danube is
lacking and therefore dismisses the claims against
an Arizona resident, entered into an investment agreement
with Defendant Flannel Damage Holdings LC (Flannel), a Utah
limited liability company, in March 2016. (Doc. 1
¶¶ 1-2, 11-12.) Flannel's only three members
are Defendants Richard Pupunu, Malohi Capital Enterprises LLC
(Malohi), and Blue Danube. (¶¶ 13-15.) Pupunu is
Flannel's managing member, and also is the sole member
and manager of Malohi, a Utah limited liability company.
(¶¶ 3, 5, 13.) Likewise, Blue Danube is a Utah
limited liability company, and its sole manager and member is
Rex, a Utah citizen. (¶¶ 4, 7, 14.)
to the agreement, Entzminger invested money in Flannel for
the purchase and resale of residential property and, in
exchange, Flannel agreed to make monthly interest payments to
Entzminger and to give him a portion of net profits from the
sale of each property. (¶¶ 17-18, 21, 24-25, 36,
37-38.) At the time the Agreement was executed, Pupunu and
Defendant Richard Baldwin (Richard) signed a guaranty, in
which they guaranteed repayment of Entzminger's
investment. (¶ 27.) Entzminger alleges that Rex signed
the guaranty as a witness, but Rex contends that his
signature was forged. (¶ 28; Doc. 17-1 ¶ 10.)
agreed to invest in Flannel because Richard, who Entzminger
has known personally for several years, misrepresented that
he was Flannel's managing member and would be in control
of the investment funds. (Doc. 1 ¶¶ 44-46.) In
reality, Richard is Rex's son, but is not a member of
Flannel, Malohi, or Blue Danube. (¶¶ 6, 47; Doc.
17-1 ¶ 14.) Entzminger had no prior relationship with
Pupunu, Rex, Blue Danube, or Malohi, and claims he would not
have invested had he known that Richard was not affiliated
with Flannel. (Doc. 1 ¶ 46.)
Flannel failed to repay the agreed-upon amounts, Entzminger
filed this lawsuit. (¶¶ 23, 41, 43.) As relevant
here, Entzminger alleges that Rex conspired with Richard and
Pupunu to defraud him, and that Rex and Blue Danube aided and
abetted Richard's fraud, acted negligently, and were
unjustly enriched by Richard's wrongful conduct.
(¶¶ 102-126.) Rex and Blue Daube have moved to
dismiss the claims against them for lack of personal
jurisdiction. (Doc. 17.)
a defendant moves to dismiss a complaint for lack of personal
jurisdiction, the plaintiff bears the burden of demonstrating
that jurisdiction is appropriate.” Schwarzenegger
v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir.
2004). To do so, the plaintiff must show both that the forum
state's long-arm statute confers jurisdiction over the
non-resident defendant and that the exercise of jurisdiction
comports with due process. Omeluk v. Langsten Slip &
Batbyggeri A/S, 52 F.3d 267, 269 (9th Cir. 1995).
as here, the state's long-arm statute confers
jurisdiction co-extensive with the limits of the due process
clause, the two inquiries merge and the court need consider
only whether the exercise of jurisdiction comports with due
process. Id.; Doe v. Am. Nat. Red Cross,
112 F.3d 1048, 1050 (9th Cir. 1997); Ariz. R. Civ. P. 4.2(a).
The exercise of jurisdiction comports with due process when
the non-resident defendant has “certain minimum
contacts with [the forum] such that the maintenance of the
suit does not offend traditional notions of fair play and
substantial justice.” Int'l Shoe v.
Washington, 326 U.S. 310, 316 (1945) (internal quotation
and citation omitted).
non-resident defendant's “motion is based on
written materials rather than an evidentiary hearing, the
plaintiff need only make a prima facie showing of
jurisdictional facts.” Schwarzenegger, 374
F.3d at 800 (internal quotations and citation omitted). At
this stage, the court “may not assume the truth of
allegations in a pleading which are contradicted by
affidavit.” Data Disc, Inc. v. Sys. Tech. Assocs.,
Inc., 557 F.2d 1280, 1284 (9th Cir. 1977).
Uncontroverted allegations in the complaint, however,
“must be taken as true, and conflicts between the facts
contained in the parties' affidavits must be resolved in
[the plaintiff's] favor for purposes of deciding whether
a prima facie case for personal jurisdiction exists.”
Am. Tel. & Tel. Co. v. Compagnie Bruxelles
Lambert, 94 F.3d 586, 588-89 (9th Cir. 1996) (internal
quotations and citations omitted).
jurisdiction can be either general or specific. General
personal jurisdiction exists where the non-resident defendant
has continuous and systematic contact with the forum.
Schwarzenegger, 374 F.3d at 801. “This is an
exacting standard, as it should be, because a finding of
general jurisdiction permits a defendant to be haled into
court in the forum state to answer for any of its activities
anywhere in the world.” Id. “When a
defendant's contacts with the forum do not rise to the
level required for general jurisdiction, a court may exercise
specific jurisdiction over a claim when it arises from the
defendant's activities within that forum.”
Compass Fin. Partners LLC v. Unlimited Holdings,
Inc., No. CV 07-1964-PHX-MHM, 2008 WL 2945585, at *2 (D.
Ariz. July 2, 2008).
there is no indication that Rex and Blue Danube had
continuous and systematic contact with Arizona, and
Entzminger argues only that they are subject to specific
personal jurisdiction. The Court employs a ...