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Westworld Consulting L.L.C. v. Vanity Group Pty Ltd.

United States District Court, D. Arizona

November 29, 2017

Westworld Consulting, L.L.C., Plaintiff,
v.
Vanity Group Pty Ltd.; Vanity Group; John Does I-XX; Jane Does I-XX; XYZ Entities 1-100. Defendants.

          ORDER

          David G. Campbell United States District Judge

         Plaintiff Westworld Consulting, LLC, filed a complaint against Defendants Vanity Group Pty. Ltd. and Vanity Group (collectively “Vanity”) seeking monetary and injunctive relief for an alleged breach of contract, promissory estoppel, conversion, negligence, and fraud. Doc. 1. Vanity has moved to dismiss for lack of personal jurisdiction. Doc. 19. The motion is fully briefed and oral argument will not aid the Court's decision. See Fed. R. Civ. P. 78(b); LRCiv 7.2(f). For the reasons set forth below, the Court will deny Vanity's motion.

         I. Background.

         Plaintiff is an Arizona company that offers consulting and networking services for business clients throughout the United States and abroad. Doc. 1 ¶ 1. Its principal place of business is Scottsdale, Arizona, and Arizona resident Mike Dunlap is its managing member. Id.; Doc. 23-1 at 1. Vanity is an Australian company that supplies luxury hotel amenities. Doc. 19-1 at 1-2. It is incorporated and headquartered in Sydney, Australia. Id.

         In November 2015, Vanity used LinkedIn to recruit Dunlap for the role of Vice President of Business Development for North America. Doc. 23-1 at 2-3. Vanity initiated the communication with an invitation to connect. Id.; Doc. 19-1 at 11; Doc. 27 ¶ 17. At the time, Vanity had no physical presence or customers in Arizona. Doc. 19-1 at 2. After preliminary discussions, Vanity invited Dunlap to interview in its Sydney office for the position. Doc. 23-1 at 3-4.

         Dunlap visited Sydney in January 2016, and the parties agreed to a long-term relationship in which Dunlap would serve as Vanity's Vice President of Business Development for North America. Id. Although Vanity attempted to draft a one-year contract compliant with U.S. law, no written contract was ever executed. Id. at 6; Doc. 19-1 at 6, 32-35. Dunlap's responsibilities included the facilitation of business relationships with potential clients throughout the United States. Doc. 23-1 at 4. The parties agreed that Dunlap would act as Vanity's agent and operate from an office in Scottsdale, Arizona. Id. Vanity provided Dunlap with Vanity business cards and a Vanity email-signature block, both of which contained a Scottsdale address. Id. at 5-6.

         Upon his return to Arizona, Dunlap began promoting Vanity's business in Arizona, California, Texas, and Nevada. Id. at 4. He started negotiating sales agreements with several national hotel chains. Id. at 6-7. Vanity paid Dunlap for this work and associated travel expenses. Id. at 8-9. Meanwhile, Vanity introduced Dunlap to customer contacts in the United States as its Vice President of Business Development for North America. Id. at 7.

         Vanity terminated its relationship with Dunlap in February 2016. Id. at 9. Plaintiff filed this action in October 2016. Doc. 1. Vanity now moves to dismiss the complaint for lack of personal jurisdiction. Doc. 19.

         II. Legal Standard.

         To withstand a 12(b)(2) motion, the plaintiff must show that the defendant is properly subject to the court's jurisdiction. Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218, 1223 (9th Cir. 2011). “Where, as here, the 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 to withstand the motion to dismiss.” Id. “The plaintiff cannot ‘simply rest on the bare allegations of its complaint, ' but uncontroverted allegations in the complaint must be taken as true.” Id. (quoting Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004)). In ruling on such a motion, the Court considers the pleadings and any materials submitted by the parties, accepting as true any uncontroverted allegations in the complaint and resolving any factual conflicts in the plaintiff's favor. Id. “Conflicts between parties over statements contained in affidavits must be resolved in the plaintiff's favor.” Schwarzenegger, 374 F.3d at 800.

         III. Discussion.

         Arizona's long-arm statute, Ariz. R. Civ. P. 4.2(a), applies in this diversity action. See Terracom v. Valley Nat'l Bank, 49 F.3d 555, 559 (9th Cir. 1995). That rule “provides for personal jurisdiction co-extensive with the limits of federal due process.” Doe v. Am. Nat'l Red Cross, 112 F.3d 1048, 1050 (9th Cir. 1997). “[A] corporation may be subject to personal jurisdiction only when its contacts with the forum support either specific or general jurisdiction.” Martinez v. Aero Caribbean, 764 F.3d 1062, 1068 (9th Cir. 2014) (citing Int'l Shoe Co. v. Washington, 326 U.S. 310 (1945)).

         Plaintiff argues that Vanity is subject to specific jurisdiction. Doc. 23 at 5. Specific jurisdiction exists if a foreign corporation's contacts with the forum give rise to the cause of action before the Court. Daimler AG v. Bauman, 134 S.Ct. 746, 754 (2014). The Ninth Circuit employs a three-prong test to determine whether a non-resident has sufficient minimum contacts for specific jurisdiction:

(1) [T]he defendant must either purposefully direct his activities toward the forum or purposefully avail himself of the privileges of conducting activities in the forum; (2) the claim must be one which arises out of or relates to the defendant's forum-related activities; and (3) the exercise of jurisdiction ...

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