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Wegbreit Group LLC v. Rite-Kem Inc.

United States District Court, D. Arizona

July 31, 2019

Wegbreit Group LLC, Plaintiff,
v.
Rite-Kem Incorporated, et al., Defendants.

          ORDER

          Dominic W. Lanza United Slates District Judge

         INTRODUCTION

         Pending before the Court are motions to dismiss, or, in the alternative, transfer venue filed by Defendants Rite-Kem Incorporated (“Rite-Kem”) and Mark C. Lovil (“Lovil”) (together, “Defendants”). (Docs. 12, 14.) Both Defendants contend the Court lacks personal jurisdiction over them. For the following reasons, the Court agrees and grants both motions to dismiss.

         BACKGROUND

         Plaintiff Wegbreit Group LLC (“Wegbreit”) is a distributor of “personal amenity items packaged in small sized containers (i.e. mouthwash, toothpaste, shampoo, antibacterial wipes, etc.) generally designed to meet the needs of anyone who is away from home such as guests in the hospitality industry, patients in the health care industry and disaster victims.” (Doc. 1 ¶ 21.) Rite-Kem is “a vendor of emergency supply kits to the General Services Administration . . . which kits were to be provided to the Federal Emergency Management Agency . . . .” (Id. ¶ 22.)

         The complaint alleges that Rite-Kem failed to pay for certain goods it received after submitting purchase orders to Wegbreit. (Id. ¶¶ 28-31, 33.) The complaint further alleges that, although Lovil, Rite-Kem's president, agreed to be personally liable for Rite-Kem's debts, he also has not paid for the goods. (Id. ¶¶ 23-26, 32)

         Wegbreit and Defendants have submitted declarations/affidavits in support of their personal jurisdiction arguments. Wegbreit attached a declaration from Susan Wegbreit (“Susan”), its vice president of sales, to its response to Rite-Kem's motion (Doc. 17-1) and its response to Lovil's motion (Doc. 20-1). Lovil filed an affidavit in support of Rite-Kem's motion (Doc. 12-1) and another in support of his own motion (Doc. 14-1). The relevant facts from those declarations/affidavits are as follows:

         Rite-Kem is a Mississippi corporation with its principal place of business in Mississippi. (Doc. 12-1 ¶ 2; Doc. 14-1 ¶ 3.) Lovil is also a Mississippi “resident citizen.” (Doc. 14-1 ¶ 2.)

         Wegbreit is an Arizona LLC with its principal place of business and headquarters in Arizona. (Doc. 17-1 ¶¶ 3-4.)[1] Wegbreit's two employees both reside in Arizona. (Id. ¶¶ 5, 27.)

         Rite-Kem is not licensed to do business in Arizona, does not maintain an office in Arizona, and does not own any real estate in Arizona. (Doc. 12-1 ¶¶ 4-6.) Furthermore, Rite-Kem does not have an Arizona telephone number or statutory agent and does not advertise or otherwise solicit business in Arizona. (Id. ¶¶ 6-8.) Similarly, Lovil also does not own any property in Arizona or have an Arizona number. (Doc. 14-1 ¶¶ 6-7.)

         On May 14, 2018, Lovil, on behalf of Rite-Kem, sent an email to Susan stating that he “was given [her] contact information as a possible source for various personal care (hygiene) items.” (Doc. 17-1 at 3 ¶ 11, 8.)

         The next day, Lovil and Susan spoke by phone. (Id. at 3 ¶ 13.) They also exchanged emails in which Susan indicated Wegbreit's address was in Arizona and Lovil requested pricing for certain products. (Id. at 3 ¶ 13, 10-11.)

         After May 15, 2018, Rite-Kem and Wegbreit began exchanging “serial and ongoing” emails and telephone calls. (Id. ¶ 14.) Rite-Kem's calls and emails were “directed from Mississippi to [Wegbreit] in Arizona.” (Id.)

         “As a result of” these emails and calls, Rite-Kem and Wegbreit entered into a Credit Application on or about July 2, 2018, which was “entered into and delivered . . . to [Wegbreit] in Arizona.” (Id. ¶ 15.) This Credit Application lists an Arizona address for Wegbreit. (Doc. 1-2 at 2-3.) Lovil “electronically signed” that form, as well as another form allowing Wegbreit to obtain credit information about Rite-Kem from a bank in Mississippi. (Doc. 12-1 ¶ 16.)

         Susan states in her declaration that Rite-Kem and Lovil “jointly entered into” the Credit Application. (Doc. 17-1 ¶ 15.) She further states that “Lovil was ‘unconditionally' obligated to pay” Rite-Kem's debts to Wegbreit. (Doc. 20-1 ¶ 18.) In contrast, Lovil states that he executed the Credit Application in his capacity as president of Rite-Kem, “did not sign the Credit Application in [his] individual capacity, ” and “did not personally guarantee Rite-Kem's payment obligations to Wegbreit.” (Doc. 14-1 ¶¶ 3-5.)[2]

         Rite-Kem emailed its purchase orders from its office in Mississippi to Wegbreit in Arizona. (Doc. 12-1 ¶ 18; Doc. 17-1 ¶ 17 [“All of [Rite-Kem's] Purchase Orders were directed from Mississippi to [Wegbreit] in Arizona . . . .”].) These purchase orders listed Wegbreit's Arizona address. (Doc. 1-2 at 6-15.) After Rite-Kem would receive a shipment, Wegbreit would email an invoice to Rite-Kem seeking payment for the products included in the shipment. (Doc. 12-1 ¶ 19.) Rite-Kem would mail the resulting payment to Wegbreit's Arizona address. (Id. ¶ 20.)

         The products from the purchase orders at issue were shipped from Tennessee, Mississippi, and New York to Rite-Kem in Mississippi. (Id. ¶¶ 23-26.)

         Neither Lovil nor any other Rite-Kem representative traveled to Arizona for the purpose of transacting business with Wegbreit. (Id. ¶ 28.)

         ANALYSIS

         I. Moti ...


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