Embry v. Hibbard Inshore, LLC, No. 2:2019cv01474 - Document 45 (E.D. La. 2019)
Court Description: ORDER AND REASONS - defendant's motion 3 to dismiss for lack of personal jurisdiction is GRANTED. Plaintiff's motion 11 to remand is DENIED AS MOOT.. Signed by Judge Sarah S. Vance on 7/1/19. (jjs)
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Embry v. Hibbard Inshore, LLC Doc. 45 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA KRISTOPHER EMBRY VERSUS CIVIL ACTION NO. 19-1474 HIBBARD INSHORE, LLC SECTION “R” (2) ORD ER AN D REASON S Before the Court are (1) defendant Hibbard Inshore, LLC’s m otion to dism iss for lack of personal jurisdiction, and (2) plaintiff Kristopher Embry’s m otion to rem and. 1 The Court grants defendant’s m otion to dism iss because plaintiff has not shown that defendant has m inim um contacts with the state of Louisiana. The Court denies plaintiff’s m otion to rem and as m oot. I. BACKGROU N D This case arises from an employment dispute. 2 Plaintiff alleges that he was em ployed by Hibbard Inshore from 20 14-20 18 as a Client Relationship Manager. 3 Hibbard Inshore is a Michigan-based organization with clients in m any different locations. 4 Plaintiff’s duties for Hibbard Inshore included 1 2 3 4 R. Doc. 3; R. Doc. 11. R. Doc. 1-3. Id. at 1. R. Doc. 3-8; R. Doc. 3-9. Dockets.Justia.com attending sales conferences, making sales calls, crafting proposals and estim ates for potential clients, and m aintaining relationships with existing clients. 5 Plaintiff com pleted these tasks rem otely, and he traveled to Hibbard Inshore’s Michigan office only about once per year. 6 During the second half of his em ploym ent with Hibbard Inshore, plaintiff allegedly worked for part of the year from his hom e in New Orleans, Louisiana. 7 Plaintiff attests that he inform ed Hibbard Inshore of his intention eventually to work rem otely from New Orleans before he was hired. 8 He states that, from 20 16 until his term ination, he made and received sales calls that involved both potential and existing clients from his hom e office in New Orleans. 9 He also allegedly attended trade shows and business m eetings in New Orleans, and he allegedly took clients to dinner on behalf of Hibbard Inshore when they were in town. 10 Finally, plaintiff states that he once hired a woman based in New Orleans to translate a set of contracts used in a Hibbard project. 11 Plaintiff 5 6 7 8 9 10 11 R. Doc. 3-3 at 1. R. Doc. 17-1 at 4 ¶ 17. R. Doc. 17-1 at 1 ¶ 5. Id. ¶ 3. Id. at 2 ¶ 5. Id. ¶ 7. Id. at 3 ¶ 8. 2 allegedly met the em ployee in New Orleans, reviewed her work in New Orleans, and paid her in New Orleans on behalf of Hibbard Inshore. 12 Plaintiff alleges that defendant unexpectedly on J une 26, 20 18. 13 term inated his em ployment As part of the term ination process, defendant allegedly provided plaintiff with a separation agreement. 14 According to plaintiff, this agreement contained term s that were unfavorable to him . 15 Plaintiff alleges that he therefore refused to sign the agreement. 16 At the tim e of plaintiff’s term ination, defendant allegedly owed him vacation pay and com m issions on accounts that he sold before his term ination. 17 Defendant allegedly refused to pay the am ounts owed. 18 Shortly after his term ination, plaintiff filed for unem ploym ent benefits in Pennsylvania. 19 On Decem ber 19, 20 18, plaintiff filed a petition for dam ages in Orleans Parish Civil District Court seeking his unpaid wages, penalty wages, attorney’s fees, costs, and interest pursuant to the Louisiana Wage Paym ent Act. 20 On February 15, 20 19, defendant rem oved the case to this Court on 12 13 14 15 16 17 18 19 20 Id. R. Doc. 1-3 at 1. Id. Id. at 1-2. Id. at 2. Id. Id. R. Doc. 3-6. R. Doc. 1-3. 3 the basis of the Court’s diversity jurisdiction. 21 Defendant then filed a m otion to dism iss for lack of personal jurisdiction. 22 Plaintiff opposes the m otion. 23 Plaintiff also filed a m otion to rem and shortly after the case was rem oved to federal court. 24 Defendant opposes the m otion. 25 In response to the m otion, defendant requested and was granted leave to file an am ended notice of rem oval that addresses the issues raised in plaintiff’s m otion to rem and. 26 On April 10 , 20 19, defendant filed an am ended notice of rem oval. 27 II. LEGAL STAN D ARD Personal jurisdiction is “an essential elem ent of the jurisdiction of a district court, without which the court is powerless to proceed to an adjudication.” Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 584 (1999) (alterations and internal quotation m arks om itted). A district court m ay exercise personal jurisdiction over a defendant if “(1) the long-arm statute of the forum state creates personal jurisdiction over the defendant; and (2) the 21 22 23 24 25 26 27 R. Doc. 1. R. Doc. 3. R. Doc. 17. R. Doc. 11. R. Doc. 13. R. Doc. 14; R. Doc. 30 . R. Doc. 31. 4 exercise of personal jurisdiction is consistent with the due process guarantees of the United States Constitution.” Revell v. Lidov, 317 F.3d 467, 469 (5th Cir. 20 0 2). Because Louisiana’s long-arm statute, La. R.S. 13:320 1, extends jurisdiction to the lim its of due process, the Court need only consider whether the exercise of jurisdiction in this case satisfies federal due process requirements. Dickson Mar. Inc. v. Panalpina, Inc., 179 F.3d 331, 336 (5th Cir. 1999). Personal jurisdiction m ay be either general or specific. Seiferth v. Helicopteros Atuneros, Inc., 472 F.3d 266, 271 (5th Cir. 20 0 6). “The plaintiff bears the burden of establishing jurisdiction but is required to present only prim a facie evidence.” Id. at 270 . General jurisdiction over a foreign defendant exists if the defendant’s “affiliations with the State are so ‘continuous and system atic’ as to render them essentially at hom e in the forum State.” Goody ear Dunlop Tires Operations, S.A. v. Brow n, 564 U.S. 915, 919 (20 11). The Fifth Circuit has articulated a three-step inquiry to determ ine whether specific jurisdiction exists. Seiferth, 472 F.3d at 271. First, the plaintiff m ust show that “the defendant has m inimum contacts with the forum state, i.e., . . . it purposely directed its activities toward the forum state or purposefully availed itself of the privileges of conducting activities there.” Id. Second, the plaintiff m ust show that his “cause of action arises 5 out of or results from the defendant’s forum -related contacts.” Id. If the plaintiff m akes these showings, “the burden shifts to the defendant to defeat jurisdiction by showing that its exercise would be unfair or unreasonable.” Id. When the district court rules on a m otion to dism iss for lack of personal jurisdiction without an evidentiary hearing, the “uncontroverted allegations in the plaintiff’s com plaint m ust be taken as true, and conflicts between the facts contained in the parties’ affidavits m ust be resolved in the plaintiff’s favor.” Johnston v. Multidata Sy s. Int’l Corp., 523 F.3d 60 2, 60 9 (5th Cir. 20 0 8). But the district court is not required “to credit conclusory allegations, even if uncontroverted.” Panda Brandy w ine Corp. v. Potom ac Elec. Pow er Co., 253 F.3d 865, 869 (5th Cir. 20 0 1). III. D ISCU SSION Defendant argues that the Court m ust dism iss plaintiff’s claims because this Court does not have personal jurisdiction over the defendant. 28 The Court m ay adjudicate plaintiff’s claim s if it has either general or specific jurisdiction over the defendant. Plaintiff does not argue that the Court has general jurisdiction, and the Court finds that it does not. General 28 R. Doc. 3-1 at 4. 6 jurisdiction over a non-resident defendant exists only if the defendant’s “affiliations with the State are so ‘continuous and systematic’ as to render them essentially at hom e in the forum State.” Goody ear, 564 U.S. at 919. Hibbard Inshore’s state of incorporation and its principal place of business are both Michigan. 29 There is no evidence that the com pany has a connection to Louisiana other than the work done by plaintiff in Louisiana. Thus, there is no showing that Hibbard Inshore is subject to general personal jurisdiction here. See Monkton Ins. Servs., Ltd. v. Ritter, 768 F.3d 429, 432 (5th Cir. 20 14) (noting that for a corporation, “[i]t is . . . incredibly difficult to establish general jurisdiction in a forum other than the place of incorporation or principal place of business”). Turning to specific jurisdiction, plaintiff has the burden of first m aking a prim a facie showing that defendant has purposefully availed itself of the privilege of conducting activities in the state of Louisiana such that it invoked the benefits and protection of that state’s laws and created m inim um contacts. Seiferth, 472 F.3d at 271. Second, plaintiff m ust show that his cause of action is related to defendant’s contact with the forum . Id. To determ ine whether a business has the necessary m inim um contacts, courts look at m any factors, including: (1) whether the defendant has a physical 29 R. Doc. 3-8; R. Doc. 3-9. 7 presence in the state, (2) whether the defendant conducts business in the state, (3) whether the contract underlying the business transaction at issue was signed in the state, and (4) whether the contract at issue called for perform ance in the state. Monkton Ins. Servs., 768 F.3d at 433. But it is well-settled that an em ployee’s personal contacts with a forum are not autom atically attributed to their employer. Burger King Corp. v. Rudzew icz, 471 U.S. 462, 478 (1985). “The unilateral activity of those who claim som e relationship with a nonresident defendant cannot satisfy the requirement of contact with the forum State.” Id. at 474; W alden v. Fiore, 571 U.S. 277, 285 (20 14) (holding that the “m inim um contacts analysis looks to the defendant’s contacts with the forum State itself, not the defendant’s contacts with persons who reside there” (internal quotation m arks om itted)). The unilateral actions of an em ployee do not create m inim um contacts in a forum for his em ployer unless there is evidence that the em ployer purposefully availed itself of the benefits and protections of the laws of the forum . In other words, “the plaintiff cannot be the only link between the defendant and the forum .” Id. Here, there is no evidence that Hibbard Inshore, as opposed to the plaintiff, created m inim um contacts with the state of Louisiana. Plaintiff has subm itted an affidavit attesting to the following facts in support of the 8 Court’s jurisdiction over the defendant: (1) plaintiff inform ed defendant when he was hired that in the future he intended to work at least partly from Louisiana; (2) he made and received both sales calls to potential clients and project update calls with existing clients from his residence in New Orleans; (3) he often took business trips in and out of the New Orleans airport, which he alleges saved the defendant m oney because New Orleans was closer to his destinations than Michigan, where Hibbard Inshore’s office is located, or Pennsylvania, where he lived when he was not in New Orleans; (4) he attended trade shows, conferences, and business meetings in New Orleans; (5) he took clients to dinner in New Orleans when they were in the city; (6) he once retained a New Orleans-based translator to work on a project for defendant and paid her on behalf of defendant in New Orleans; (7) he solicited clients in the southeastern United States and used his location in New Orleans as a selling point; (8) he purchased office supplies and sent packages via Hibbard’s Fedex account in New Orleans; (9) he received packages, stored m arketing m aterials, and used a com puter owned by defendant in his New Orleans hom e. 30 Plaintiff also points to a nondisclosure agreem ent that he signed in 20 14, which states that all business m aterials had to rem ain on defendant’s property. Plaintiff argues 30 R. Doc. 17-1. 9 that this contractual language indicates that defendant considered plaintiff’s hom e office in New Orleans com pany property. 31 These facts dem onstrate a relationship between plaintiff and the state of Louisiana, but they do not show that defendant purposely directed its activities toward the state or purposefully availed itself of the privileges of conducting activities here. While plaintiff worked partly from Louisiana for the second two years of his employment, he did so of his own volition and not at the direction of the defendant. Defendant attests that it has never been licensed or authorized to conduct business in Louisiana, and that it has never leased, rented, or owned property in Louisiana. 32 Plaintiff presents no evidence contradicting these statem ents. Plaintiff’s assertion that his hom e becam e the defendant’s office based on the terms of the nondisclosure agreement is unavailing. There is no evidence that defendant leased or owned the space. A nondisclosure agreement does not transform the plaintiff’s personally-owned residence into his em ployer’s office absent any intent or financial contribution by the em ployer. With regard to Hibbard Inshore’s business activities, plaintiff does not allege that Hibbard ever directed him to reach out to potential clients in Louisiana or that it hoped to 31 32 Id. at 5. R. Doc. 3-8 at 1. 10 target businesses in the state. Indeed, plaintiff does not name even one client of defendant’s domiciled in Louisiana. As evidence of defendant’s work in Louisiana, plaintiff points to leveraging his proxim ity to potential clients based in Savannah, Georgia and Houston, Texas. 33 Connections to these businesses in other states do not establish a connection to Louisiana. Further, plaintiff has not shown precisely how m uch tim e he spent in Louisiana from 20 16-20 18. Plaintiff traveled frequently for work, 34 and his clients appear to have been based on the East and West Coasts. 35 Plaintiff’s job entailed “flying to the location of the customer and developing the sale at the location of the client.”36 That plaintiff’s frequent travel reduced the am ount of tim e he worked from New Orleans, that his work occurred m ostly at client sites, and that defendant did not assign him to a particular base of operations suggest that defendant was agnostic as to where plaintiff spent his tim e while he was not traveling. Indeed, defendant represents that plaintiff was hired to develop business on the East and West Coasts. 37 Plaintiff’s representation that he did a m ajority of his work from New Orleans is also underm ined by a com m unication indicating that his pay stub did not 33 34 35 36 37 R. Doc. 17-1 at 3. R. Doc. 17-1 at 2 ¶ 6. R. Doc. 3-8 at 2 ¶ 11. Id. Id. 11 reflect a New Orleans address until after April 30 , 20 18, 38 and by his decision to apply for unem ployment in Pennsylvania im mediately after his term ination. 39 Having one em ployee work from his home while not at client sites does not establish a connection between the defendant and Louisiana. Nor does plaintiff’s decision to use a New Orleans-based translator to whom defendant m ade a single payment after the work was com pleted establish personal jurisdiction. In cases where other district courts have held that an em ployer with a rem ote em ployee was subject to personal jurisdiction where the employee lived, the courts focused on the employer’s purposeful outreach to recruit an em ployee from that state. See Hall v. Rag-O-Ram a, LLC, 359 F. Supp. 499, 512 (E.D. Ky. 20 19) (holding that em ployer’s contact with Kentucky was not the result of the plaintiff’s unilateral conduct because the em ployer “recruited Plaintiff in Kentucky, sent a signed contract to Plaintiff in Kentucky, and engaged in a close working relationship with Plaintiff in Kentucky for a substantial period of tim e”); W illiam s v. Preem inent Protective Servs. Inc., 81 F. Supp. 3d 265, 272 (E.D.N.Y. 20 18) (holding that em ployer purposefully availed itself of the forum “when they hired plaintiff 38 39 R. Doc. 23-3. R. Doc. 3-6. 12 to conduct their m arketing and com m unications while she lived in Brooklyn”). Defendant did not go to the state of Louisiana to recruit the plaintiff, because at the tim e defendant hired plaintiff and negotiated his em ploym ent contract, plaintiff lived in Pennsylvania. 40 Plaintiff’s contract was not negotiated or signed in Louisiana, and plaintiff had no connection to Louisiana at the tim e he was hired. He m erely stated that he had plans to live in Louisiana part tim e at some point in the future. Plaintiff did not begin to work from Louisiana until two years after being hired. Courts have also focused on whether the em ployer preferred or required that the em ployee work in the forum state. See W inner v. Try ko Partners, LLC, 333 F. Supp. 3d 250 , 260 (W.D.N.Y. 20 18) (holding that personal jurisdiction existed when employer hired plaintiff “with the express agreement from the outset, that she would work from New York,” and the em ployer “affirm atively did not want her at its corporate office in New J ersey” (internal quotation m arks and alternations om itted)); cf. File Im age Servs., LLC v. Klein, No. 0 9-484, 20 0 9 WL 2412443, at *2 (E.D. Wis. 20 0 9) (holding that even if “defendants were fully aware that the plaintiff had relocated to Wisconsin, this is insufficient to cause the defendants to be subject to the jurisdiction of Wisconsin courts” when “[t]here [was] no 40 R. Doc. 3-3 at 1. 13 suggestion that the contract specified where the work was to be perform ed”). Plaintiff provides no evidence that defendant wanted him to work from Louisiana. At m ost, defendant passively acquiesced in his decision to m ove there while he was not visiting client sites. A failure to object affirm atively to an em ployee’s unilateral decision does not constitute purposeful availm ent. Multiple other district courts have held that m inim um contacts were not established when the plaintiff em ployee was the only em ployee in the state, and the em ployer passively allowed the plaintiff to m ove to that state, or the em ployment contract did not require that the work be performed in a particular location. See Jeffs v. W orld Monum ents Fund, Inc., No. 17-198, 20 17 WL 4864981, at *4 (E.D. Pa. 20 17) (finding no m inim um contacts when contract was negotiated outside of Pennsylvania, plaintiff was “neither instructed nor required to live in Pennsylvania,” and, although plaintiff attended meetings in Pennsylvania on defendant’s behalf, “nothing in the record indicates that Plaintiff was required to solicit business in Pennsylvania as a condition of his em ployment”); Rosenberg v. Deutsche Bank AG, No. 11-0 220 0 , 20 12 WL 3744632, at *5 (D. Colo. May 22, 20 12), adopted by No. 11-0 220 0 , 20 12 WL 3744631 (D. Colo. Aug. 28, 20 12) (finding no m inim um contacts when it was “undisputed that it was Plaintiff’s 14 unilateral decision to relocate to Colorado”); W right v. Zacky & Sons Poultry , LLC, 10 5 F. Supp. 3d 531, 540 (M.D.N.C. 20 15) (finding no m inim um contacts when “neither [plaintiff’s em ployer] nor the contract required him to be in North Carolina while perform ing those duties” and defendant m erely acquiesced to plaintiff’s trips to North Carolina where he would work from hom e). J udge Martin Feldm an in this district has also held that, in sim ilar circum stances, em ploying a rem ote worker did not establish m inim um contacts. See Sciortino v. CMG Capital Mgm t. Grp., Inc., No. 16110 12, 20 16 WL 47990 99, at *6 (E.D. La. Sept. 14, 20 16). In Sciortino, a defendant employer in a Louisiana Wage Payment Act case did not establish m inim um contacts by hiring an em ployee who worked m ainly from his home office in Louisiana because, am ong other reasons, defendant did not m aintain an office or own property in Louisiana; the plaintiff applied for the position from outside of Louisiana and negotiated the term s of his em ploym ent outside of Louisiana; plaintiff was the only em ployee who resided in Louisiana; and plaintiff’s benefits were adm inistered in another state. Sciortino, No. 16-110 12, 20 16 WL 47990 99, at *4-6. The Court finds that the facts and reasoning of Sciortino and the other district court cases finding that m inim um contacts were not established are analogous to those in this case, where plaintiff also negotiated his em ployment contract outside 15 the state, was the only em ployee in the state, and had his benefits adm inistered outside the state. The relevant case law establishes that when a person working rem otely m akes a unilateral decision to m ove after being hired, an em ployer’s m ere acquiescence or indifference to the em ployee’s decision does not constitute purposeful availm ent of the benefits of a state and protection of its laws when the employer is not conducting business in the state. Accordingly, plaintiff has not m et his burden of establishing a prim a facie showing of defendant’s m inim um contacts with the state of Louisiana. IV. CON CLU SION For the foregoing reasons, defendant’s m otion to dism iss for lack of personal jurisdiction is GRANTED. Plaintiff’s m otion to rem and is DENIED AS MOOT. New Orleans, Louisiana, this _ _1st _ _ _ day of J uly, 20 19. _____________________ SARAH S. VANCE UNITED STATES DISTRICT J UDGE 16
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