United States District Court, D. Arizona
Honorable Susan M. Brnovich, United States District Judge.
before the Court is Defendant Whole Foods Market
Incorporated's Motion to Dismiss. (Doc. 17,
“Mot.”). Plaintiff Jacqueline Rodriguez filed an
opposition. (Docs. 22, 24, “Resp.”), and
Defendant filed a Reply, (Doc. 26, “Reply”). Also
pending before the Court is Plaintiff's Motion for
Joinder of Parties, (Doc. 23), to which Defendant filed a
Response, (Doc. 27).
reasons below, the Court will grant Defendant's Motion,
(Doc. 17), and grant in part and deny in part Plaintiff's
Motion, (Doc. 23).
October 23, 2018, Plaintiff Jacqueline Rodriguez filed a
complaint alleging six counts against Defendant Whole Foods
Market, Inc. (“WFMI”) (Doc. 1,
“Complaint”). The allegations in Plaintiff's
complaint involve a Whole Foods store in Flagstaff, Arizona
(the “Store”). Plaintiff alleges that Defendant
WFMI is liable for her claims involving the Store. The
allegations include “Negligent Infliction of Emotional
Distress, False Advertising, Strict Liability, Breach of
Warranty, Food Fraud, and Misrepresentation.”
(Complaint). Plaintiff alleges that this Court has
jurisdiction pursuant to 28 U.S.C. § 1332.
filed the instant Motion to Dismiss, requesting dismissal
because WFMI is not a proper party and because the Court
lacks personal jurisdiction. Defendant also requests to
dismiss Plaintiff's counts of “false
advertising” and “food fraud” pursuant to
Rule 12(b)(6). Plaintiff then filed a motion requesting
permission to join two additional parties-Mrs. Gooch's
Natural Food Markets Inc. (“Mrs. Gooch's”)
and Whole Foods Market Services Inc. (“WFM
Services”). (Doc. 23).
MOTION TO DISMISS
the Defendant's motion invokes both Rules 12(b)(2) and
12(b)(6), the Court need not reach the Rule 12(b)(6)
arguments because the Defendant's Rule 12(b)(2)
jurisdictional argument is dispositive. See McGeachy v.
Pinto Valley Mining Corp., No. 2:16-cv-03348 JWS, 2017
WL 3130639, at *2 (D. Ariz. July 24, 2017) (“Although
the [defendants'] motion invokes both Rule 12(b)(2) and
(b)(6), the court need not reach the Rule 12(b)(6) argument
because the [defendants'] Rule 12(b)(2) jurisdictional
argument is dispositive.”).
motion to dismiss for lack of personal jurisdiction may be
brought pursuant to Rule 12(b)(2). Fed.R.Civ.P. 12(b)(2).
Plaintiffs bear the burden of establishing personal
jurisdiction. Ziegler v. Indian River Cty., 64 F.3d
470, 473 (9th Cir. 1995). “In resolving a Rule 12(b)(2)
motion, the court may consider evidence outside the
pleadings, including affidavits and other materials submitted
on the motion.” Lindora, LLC v. Isagenix Int'l,
LLC, 198 F.Supp.3d 1127, 1135 (S.D. Cal. 2016) (citing
Daimler AG v. Bauman, 571 U.S. 117, 123 (2014)).
Where the motion is based on written materials rather than an
evidentiary hearing, “the plaintiff need only make a
prima facie showing of jurisdictional facts.” Sher
v. Johnson, 911 F.2d 1357, 1361 (9th Cir. 1990). In
determining whether the plaintiff has met this burden,
uncontroverted allegations in the plaintiff's complaint
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.”
AT & T v. Compagnie Bruxelles Lambert, 94 F.3d
586, 588 (9th Cir. 1996).
. . . there is no applicable federal statute governing
personal jurisdiction, the district court applies the law of
the state in which the district court sits.” Dole
Food Co. v. Watts, 303 F.3d 1104, 1110 (9th Cir. 2002).
Arizona exerts personal jurisdiction to the “maximum
extent permitted by the Arizona Constitution and the United
States Constitution.” Ariz. R. Civ. P. 4.2(a); see
also A. Uberti and C. v. Leonardo, 892 P.2d 1354, 1358
(Ariz. 1995). Therefore, the analyses of personal
jurisdiction under Arizona law and federal due process are
the same. Schwarzenegger v. Fred Martin Motor Co.,
374 F.3d 797, 800-01 (9th Cir. 2004).
the Due Process Clause, “[a]lthough a nonresident's
physical presence within the territorial jurisdiction of the
court is not required, the nonresident generally must have
certain minimum contacts . . . such that the maintenance of
the suit does not offend traditional notions of fair play and
substantial justice.” Walden v. Fiore, 571
U.S. 277, 283 (2014) (citations and internal quotation marks
omitted). A court may assert general or specific jurisdiction
over the nonresident defendant. Cybersell v.
Cybersell, 130 F.3d 414, 416 (9th Cir. 1997). General
jurisdiction exists when the defendant has “continuous
and systematic” contacts with the forum state, whereas
specific jurisdiction exists when the controversy arises from
or is related to the defendant's contact with the forum
state. See Helicopteros Nacionales de Colombia v.
Hall, 466 U.S. 408, 414 (1984).
alter ego theory may be considered in a personal jurisdiction
analysis. “The existence of a parent-subsidiary
relationship is insufficient, on its own, to justify imputing
one entity's contacts with a forum state to another for
the purpose of establishing personal jurisdiction.”
Ranza v. Nike, Inc., 793 F.3d 1059, 1070 (9th Cir.
2015). “The alter ego test is designed to determine
whether the parent and subsidiary are ‘not really
separate entities,' such that one entity's contacts
with the forum state can be fairly attributed to the
other.” Id. at 1071 (quoting Doe v. Unocal
Corp., 248 F.3d 915, 926 (9th Cir. 2001)). “In
narrow circumstances federal courts will find that a
corporation is the alter ego of another by piercing the
corporate veil and attributing a subsidiary's contacts
with the forum state to its parent company for jurisdictional
purposes.” Corcoran v. CVS Health Corp., 169
F.Supp.3d 970, 983 (N.D. Cal. 2016) (citations, alterations,
and internal quotation marks omitted); see also
Ranza, 793 F.3d at 1071 (“[T]he veil separating
affiliated corporations may also be pierced to exercise
personal jurisdiction over a foreign defendant in certain
limited circumstances.”). “To allow a court to
impute a subsidiary corporation's contacts with a forum
to the parent, the plaintiff must make a prima facie showing
that the ‘parent and subsidiary are not really separate
entities . . . .” Monje v. Spin Master Inc.,
No. CV-09-1713-PHX-GMS, 2013 WL 2390625, at *4 (D. Ariz. May
30, 2013) (quoting Unocal Corp., 248 F.3d at 926).
In a diversity case, such as this one, state law is applied
to determine whether a parent company should be treated as
the alter ego of a subsidiary for jurisdictional purposes.
See Hambleton Bros. Lumber Co. v. Balkin Enters.,
397 F.3d 1217, 1227 (9th Cir. 2005) (noting that in diversity
actions, federal courts must apply state law when evaluating
alter ego status).
Arizona law, “corporate status will not be lightly
disregarded.” Chapman v. Field, 602 P.2d 481,
483 (Ariz. 1979). “The alter-ego status is said to
exist when there is such unity of interest and ownership that
the separate personalities of the corporation and owners
cease to exist.” Dietel v. Day, 492 P.2d 455,
457 (Ariz.Ct.App. 1972). A plaintiff “must prove both
(1) unity of control and (2) that observance of the corporate
form would sanction a fraud or promote injustice.”
Gatecliff v. Great Republic Life Ins. Co., 821 P.2d
725, 728 (1991) (citing Dietel, 492 P.2d at 457).
Unity of control occurs when a parent exerts
“substantially total control over the management and
activities” of its subsidiary. Id.
“Substantially total control” can be shown by,
among other things: “stock ownership by the parent;
common officers or directors; financing of subsidiary by the
parent; payment of salaries and other expenses of subsidiary
by the parent; failure of subsidiary to maintain formalities
of separate corporate existence; similarity of logo; and
plaintiff's lack of knowledge of subsidiary's
separate corporate existence.” Id.
“Isolated occurrences of some of these factors are not
enough to establish an alter ego liability.” Morgan
v. Freightliner of Ariz. LLC, No. CV-16-00498-TUC-CKJ,
2018 WL 3957745, at *4 (D. Ariz. Aug. 17, 2018). “To be
held responsible for actions of its subsidiary, the parent
must actually exercise this control so that the subsidiary
becomes ‘a mere instrumentality.'” Taeger