Metro PCS v. A2Z Connection, LLC et al, No. 2:2015cv01412 - Document 110 (D. Nev. 2019)
Court Description: ORDER denying 78 Motion to Dismiss; ORDER granting 83 Motion to Strike; ORDER denying 92 Motion for Leave to File Document; Signed by Judge Jennifer A. Dorsey on 3/18/2019. (Copies have been distributed pursuant to the NEF - JM)
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Metro PCS v. A2Z Connection, LLC et al Doc. 110 1 UNITED STATES DISTRICT COURT 2 DISTRICT OF NEVADA 3 MetroPCS, 4 Plaintiff 5 v. Case No.: 2:15-cv-01412-JAD-CWH Order (1) Denying Motion to Dismiss, (2) Denying Motion to Supplement, and (3) Granting Motion to Strike Affirmative Defenses 6 A2Z Connection, LLC, et al., [ECF Nos. 78, 83, 92] 7 Defendants 8 Defendant Amir Qureshi previously moved to set aside the default and default judgment 9 that had been entered against him as void for lack of personal jurisdiction. After careful review, 10 I determined that “Amir’s evidence that jurisdiction is lacking isn’t substantial, but it doesn’t 11 have to be because MetroPCS hasn’t made a prima facie case for personal jurisdiction.” 1 So, I 12 granted Amir’s motion and set aside the default and default judgment against him. I did not 13 dismiss any of the claims that have been alleged against Amir, but instead instructed that “he 14 must seek that relief through a separate motion.” 2 15 Amir now seeks that relief, arguing that I must apply the law-of-the-case doctrine and 16 dismiss the claims against him without further consideration, or dismiss them for the reasons he 17 argued before. 3 MetroPCS responds that either the law-of-the-case doctrine doesn’t apply or 18 these circumstances merit departing from that doctrine because MetroPCS has uncovered 19 substantial new evidence that undercuts Amir’s claim that his only contacts with Nevada were to 20 visit family. Amir argues in reply that MetroPCS’s burden at this stage is to satisfy the 21 22 1 ECF No. 75 at 10–17. 23 2 Id. at 17. 3 ECF No. 78. Dockets.Justia.com 1 preponderance-of-the-evidence standard, and he objects that much of MetroPCS’s evidence is 2 inadmissible. 4 To address Amir’s objections, MetroPCS moves to supplement its response with 3 new evidence and reporter-certification pages for the deposition transcripts it provided. 5 It also 4 moves to strike two affirmative defenses from Asim and Seher Qureshi’s answer. 6 5 For the reasons discussed below, I deny Amir’s motion to dismiss. I did not consider 6 evidence beyond two declarations in determining Amir’s dismissal motion, so I deny as moot 7 MetroPCS’s motion to supplement its response to that motion. Finally, I grant MetroPCS’s 8 motion to strike with leave for Asim and Seher to amend their sixth affirmative defense but 9 without leave to amend their twentieth defense. 10 Discussion 11 12 I. Amir’s motion to dismiss for lack of personal jurisdiction [ECF No. 78] and MetroPCS’s motion to supplement its response [ECF No. 92] 13 A. 14 “Under the ‘law of the case’ doctrine, ‘a court is generally precluded from reconsidering Substantially new evidence merits departing from the law of this case. 15 an issue that has already been decided by the same court, or a higher court in the identical 16 case.’” 7 But the doctrine “does not impinge upon a district court’s power to reconsider its own 17 interlocutory order provided that the district court has not been divested of jurisdiction over the 18 order.” 8 “For the doctrine to apply[,] the issue in question must have been decided explicitly or 19 4 ECF No. 87. 5 21 ECF No. 92. 6 ECF No. 83. 22 7 20 23 U.S. v. Alexander, 106 F.3d 874, 876 (9th Cir. 1997) (quoting Thomas v. Bible, 983 F.2d 152, 154 (9th Cir.), cert. denied, 508 U.S. 951 (1993)). 8 City of Los Angeles, Harbor Div. v. Santa Monica Baykeeper, 254 F.3d 882, 888 (9th Cir. 2001). 2 1 by necessary implication in the previous disposition.” 9 But the law-of-the-case doctrine is a 2 judicial construct that doesn’t limit a tribunal’s power, rather, it is a guide to judicial discretion. 10 3 So courts have discretion to depart from the doctrine where: (1) “the first decision was clearly 4 erroneous[,]” (2) “an intervening change in the law has occurred[,]” (3) “the evidence on remand 5 is substantially different[,]” (4) “other changed circumstances exist[,]” or (5) “a manifest 6 injustice would otherwise result.” 11 7 Relying on this doctrine, Amir argues that I cannot revisit the question of whether 8 MetroPCS has made a prima facie showing that personal jurisdiction exists over him because I 9 explicitly decided that legal question when I granted his set-aside motion. 12 I agree that finding 10 is the law of this case and I am not being asked to reconsider my prior order, but MetroPCS 11 provides evidence in response to Amir’s dismissal motion that is substantially different from 12 what it provided in response to Amir’s set-aside motion or alleges in its complaint. In light of 13 this new evidence, I exercise my discretion to depart from the law of this case and decide Amir’s 14 dismissal motion on its merits. 15 B. 16 “Where a defendant moves to dismiss a complaint for lack of personal jurisdiction, the MetroPCS’s burden is to make a prima facie showing of jurisdictional facts. 17 plaintiff bears the burden of demonstrating that jurisdiction is appropriate.” 13 Unless the court 18 conducts an evidentiary hearing, “the plaintiff need only make a prima facie showing of 19 20 9 U.S. v. Lummi Indian Tribe, 235 F.3d 443, 452 (9th Cir. 2000) (quotation and brackets 21 omitted). 10 Alexander, 106 F.3d at 876. 22 11 Id. 23 12 ECF No. 75 at 17. 13 Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004). 3 1 jurisdictional facts.” 14 “In such cases, [the court] inquire[s] into whether the plaintiff’s pleadings 2 and affidavits make a prima facie showing of personal jurisdiction.” 15 Under this standard, 3 “uncontroverted allegations in the complaint must be taken as true . . . . [and] [c]onflicts between 4 the parties over statements contained in the affidavits must be resolved in the plaintiff’s favor.” 16 5 Amir argues that MetroPCS is subject to the preponderance-of-the-evidence standard, 6 which is higher than the prima facie standard, because I have “already conducted a hearing” and 7 “reviewed substantial evidence” about the personal-jurisdiction issue. ECF No. 87 at 2. But I 8 did not conduct a hearing on personal jurisdiction, nor did I look beyond the parties’ allegations 9 and declarations in deciding Amir’s set-aside motion. And I do not look beyond the parties’ 10 declarations in determining this motion either, so MetroPCS’s burden remains making a prima 11 facie showing of jurisdictional facts. 12 C. 13 Amir relies on his previous declaration that his only contacts with Nevada are family MetroPCS has shown that Nevada has specific jurisdiction over Amir. 14 visits. 17 MetroPCS provides a host of new evidence, and what stands out is a declaration from 15 Mark Devor, who testified about his work obtaining cellphones for A2Z in 2015. 18 Devor’s 16 testimony directly controverts Amir’s testimony that his only contacts with Nevada are family 17 visits. I do not look beyond the declarations at this time, so I must resolve these conflicts in 18 MetroPCS’s favor. 19 Amir doesn’t address Devor’s testimony other than to argue that it isn’t 19 20 14 Id. (quotation omitted). 15 Id. (quotation and brackets omitted). 16 22 Id. 17 ECF No. 78-1. 23 18 ECF No. 84-1 at 52, ¶ 3. 19 See Schwarzenegger, 374 F.3d at 800. 21 4 1 new. But Devor testified that when MetroPCS sued him and another employee in 2016, he never 2 appeared despite being served with process. 20 MetroPCS explains that it did not hear from 3 Devor until September 2018 after he was served with an order to show cause why he should not 4 be held in contempt for failing to appear at a post-judgment deposition in that case. 21 I am 5 persuaded that MetroPCS could not have provided this evidence in time for me to consider it 6 when I ruled on Amir’s set-aside motion. 7 According to Devor, Amir was his “direct boss” at A2Z who managed his day-to-day 8 work, and with whom he met several times in Las Vegas, Nevada, to receive his work 9 instructions. 22 The directions given during a May 2015 meeting in Las Vegas included that 10 Devor was to obtain MetroPCS cellphones as quickly and cheaply as possible from MetroPCS 11 stores by paying cash and focusing on new Samsung Galaxy and LG phones. 23 It was agreed 12 during this meeting that Devor would be paid at the end of each day for the cellphones that he 13 had acquired. 24 Amir instructed Devor to open a Bank of America bank account. 25 Devor also 14 met Amir in Las Vegas in June 2015 and obtained payment from him for the 400 cellphones that 15 16 17 20 ECF No. 84-1 at 52, ¶ 2. 21 ECF No. 84 at 5, n.5. I take judicial notice of the docket in MetroPCS v. Mark Devor, 16-cv2949 (N.D. Ill.), which reflects that the Clerk of Court entered default against Devor on May 24, 19 2016, and default judgment against him on October 7, 2016. The district court issued an order to show cause why Devor should not be held in contempt for violating its order compelling him to 20 attend post-judgment depositions on August 30, 2018, which MetroPCS withdrew during the hearing held on October 4, 2018. Devor’s declaration in this case was executed on September 21 18, 2018, so between these dates. ECF No. 84-1 at 54. 22 ECF No. 84-1 at 52–54, ¶¶ 4–7. 22 23 Id. at 53, ¶ 6. 18 23 24 Id. 25 Id. 5 1 Devor had obtained and Amir also paid Devor’s “living expenses” like hotel costs. 26 MetroPCS 2 relies on these facts to argue that Nevada can exercise specific jurisdiction over Amir. 3 Under the three-prong test for analyzing a claim of specific jurisdiction, (1) the 4 nonresident defendant must have purposefully availed himself of the privilege of conducting 5 activities in the forum or purposefully directed his activities toward the forum; (2) the claim must 6 arise out of or relate to the defendant’s forum-related activities; and (3) the exercise of 7 jurisdiction must be reasonable. 27 If the plaintiff satisfies the first two prongs, “the burden then 8 shifts to the defendant to “present a compelling case” that the exercise of jurisdiction would not 9 be reasonable.” 28 10 Under the first prong, “[e]vidence of availment is typically action taking place in the 11 forum that invokes the benefits and protections of the laws in the forum.” 29 While “[e]vidence 12 of direction generally consists of action taking place outside the forum that is directed at the 13 forum.” 30 Devor’s testimony about the acts that Amir purposefully committed in Nevada in his 14 capacity as an employee of a Nevada entity and in furtherance of an alleged cellphone-unlock15 and-resale scheme is enough to satisfy the first prong under a purposeful availment analysis. 31 16 The second prong is also satisfied because MetroPCS’s claims against Amir arise out his 17 18 19 26 Id. at 53–54, ¶ 7. 27 Schwarzenegger, 374 F.3d at 802. 28 21 Id. (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476–78 (1985)). 29 Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1155 (9th Cir. 2006). 22 30 Id. 20 31 23 Amir’s argument that MetroPCS’s evidence fails the Calder v. Jones “effects” test is misplaced because that test is applied in purposeful-direction cases; this is a purposefulavailment case. ECF No. 78 at 5–6 (citing Calder v. Jones, 465 U.S. 783 (1984)). 6 1 Nevada-related activities of directing, managing, and paying A2Z employees for their part of the 2 alleged scheme of acquiring MetroPCS cellphones for him to resell. 32 3 MetroPCS has satisfied the first two prongs, so the burden shifts to Amir to demonstrate 4 that it would be unreasonable for a Nevada court to exercise jurisdiction over him. Amir argues 5 that it would be unfair to subject him to jurisdiction in Nevada because his “interjections” into 6 this state “are miniscule” and his burden of defending a case in a state nearly 2,000 miles away 7 are high. He contends that Nevada “would seem to have little interest in adjudicating this 8 dispute between a company not based in Nevada and an Illinois resident for conduct that 9 occurred in California.” 33 The facts that Amir relies on to make these points are directly 10 controverted by MetroPCS’s evidence, a dispute I must resolve in MetroPCS’s favor. 11 Amir argues in reply that MetroPCS’s evidence shows only that Amir attended meetings 12 in Nevada, not that he committed any act in furtherance of the alleged scheme in this state. 34 But 13 this isn’t a fair characterization of the evidence. Devor did testify that both Amir and Asim were 14 at the Las Vegas meetings, but he clearly identifies Amir as his direct boss at A2Z and he 15 distinguishes between the directions he received from Amir, the ones he received from Asim, 16 and the ones he received from both brothers. 35 Devor testifies only about directions that he 17 received from the brothers in person in Nevada. Amir has failed to demonstrate that he could not 18 19 20 32 23 34 ECF No. 87 at 10–11. 35 See, e.g., ECF No. 84-1 at 53, ¶ 6. MetroPCS alleges 14 claims sounding in tort and fraud against the defendants for the alleged scheme to buy, unlock, and resell MetroPCS cellphones, including tortious interference, 21 conspiracy to commit fraud, fraud, trafficking in computer passwords in violation of 18 U.S.C. § 1030(a)(6), and trademark infringement. ECF No. 1. 22 33 ECF No. 78 at 9 (incorrectly referring to this as the “third part” of the Calder “effects” test). 7 1 reasonably expect to be sued in Nevada for actions he allegedly committed in his capacity as an 2 employee of a Nevada entity in furtherance of a scheme run through that entity. 3 MetroPCS has made a prima facie showing that Nevada has specific jurisdiction over 4 Amir, so I deny Amir’s motion to dismiss. The only evidence I considered in making this 5 determination are the declarations from Amir and Devor. Accordingly, I need not—and do 6 not—consider Amir’s objections to MetroPCS’s other pieces of new evidence, 36 and I deny as 7 moot MetroPCS’s motion to supplement its response to the dismissal motion. 37 8 II. MetroPCS’s motion to strike affirmative defenses [ECF No. 83] 9 Finally, MetroPCS moves to strike the sixth and twentieth affirmative defenses from 10 Asim and Seher’s answer. 38 Motions to strike are generally disfavored; the purpose of these 11 motions “is to avoid the expenditure of time and money that must arise from litigating spurious 12 issues by dispensing with those issues” before trial. 39 Federal Civil Procedure Rule 12(f) 13 authorizes district courts to strike “an insufficient defense” from a pleading. “The key to 14 determining the sufficiency of pleading an affirmative defense is whether it gives plaintiff fair 15 notice of the defense.” 40 The fair-notice pleading standard “generally requires the defendant to 16 state the nature and grounds for the affirmative defense. It does not, however, require a detailed 17 statement of facts.” 41 18 19 20 21 22 23 36 ECF No. 87 at 8–10. 37 ECF No. 92. 38 ECF No. 83. 39 Whittlestone, Inc. v. Handi-Craft Co., 618 F.3d 970, 973 (9th Cir. 2010). 40 Wyshak v. City Nat. Bank, 607 F.2d 824, 827 (9th Cir. 1979). 41 Kohler v. Staples the Office Superstore, LLC, 291 F.R.D. 464 (E.D. Cal. 2013) (citing Conley v. Gibson, 355 U.S. 41, 47–48 (1957)). 8 1 Asim and Seher’s sixth affirmative defense, entitled “failure to enjoin a necessary party,” 2 states that “Plaintiff has failed to join an indispensable party to this action in accordance with 3 NRCP 19 and/or the Defendant is not a proper party to this litigation.” 42 MetroPCS argues that 4 this defense is deficient because it is really two defenses and it doesn’t indicate who the allegedly 5 indispensable-but-not-named party is. Nor does it identify which defendant is not properly 6 named and why. Asim and Seher respond that this defense gives adequate notice because it 7 identifies the legal theory on which it is based and FRCP 8(d)(2) allows them to make two or 8 more alternative or hypothetical statements of a defense in a single defense. 43 9 Both parts of this defense are deficient because they state only the nature of the defense, 10 not the grounds for it. For the first part, Asim and Seher must invoke the correct procedural 11 rule—FRCP 19, not NRCP 19—and identify either the persons or categories of persons whom 12 they contend MetroPCS failed to join. And for the second part of this defense, Asim and Seher 13 must identify which defendants are not proper parties and why. Thus, I strike Asim and Seher’s 14 sixth affirmative defense without prejudice and with leave to amend their answer to cure these 15 deficiencies. 16 Asim and Seher’s twentieth affirmative defense, entitled “reservation of defenses,” states 17 that “[p]ursuant to FRCP 11, all of the Defendants’ affirmative defenses may not have been 18 know at the time of answering and therefore the Defendants reserve their right to amend this 19 answer and plead such affirmative defenses once they are discovered.” 44 Asim and Seher admit 20 in response to the motion to strike that this is not a true affirmative defense and that any 21 22 42 ECF No. 76 at 8. 23 43 ECF No. 93 at 4. 44 ECF No. 76 at 10. 9 1 amendment requires compliance with Rule 15. But they ask me not to strike it because 2 MetroPCS has not shown that it has been prejudiced. Because a reservation of rights to assert 3 additional defenses is neither appropriate under the Federal Rules of Civil Procedure nor an 4 affirmative defense, I strike Asim and Seher’s twentieth affirmative defense with prejudice and 5 without leave to amend. 6 7 Conclusion IT IS HEREBY ORDERED that Amir’s motion to dismiss [ECF No. 78] is DENIED 8 and MetroPCS’s motion to supplement its response [ECF No. 92] is DENIED as moot. 9 IT IS FURTHER ORDERED that MetroPCS’s motion to strike affirmative defenses from 10 Asim and Seher’s answer [ECF No. 83] is GRANTED. Asim and Seher’s sixth affirmative 11 defense is STRUCK without prejudice and with leave to amend and their twentieth affirmative 12 defense is STRUCK with prejudice and without leave to amend. 13 Dated: March 18, 2019 14 _________________________________ U.S. District Judge Jennifer A. Dorsey 15 16 17 18 19 20 21 22 23 10
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