199 F.3d 1321 (2nd Cir. 1999), 99-7279, Clarke v. Fonix Corp.

Docket Nº:99-7279.
Citation:199 F.3d 1321
Party Name:John R. CLARKE, and Perpetual Growth Funds Advisors, Inc., Plaintiffs-appellants, v. FONIX CORPORATION, Stephen M. Hicks, Southridge Capital Management, LLC, and Sovereign Partners, L.P., Defendants-Appellees.
Case Date:October 14, 1999
Court:United States Courts of Appeals, Court of Appeals for the Second Circuit
 
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Page 1321

199 F.3d 1321 (2nd Cir. 1999)

John R. CLARKE, and Perpetual Growth Funds Advisors, Inc., Plaintiffs-appellants,

v.

FONIX CORPORATION, Stephen M. Hicks, Southridge Capital Management, LLC, and Sovereign Partners, L.P., Defendants-Appellees.

No. 99-7279.

United States Court of Appeals, Second Circuit

October 14, 1999

Editorial Note:

This opinion appears in the Federal reporter in a table titled "Table of Decisions Without Reported Opinions". (See FI CTA2 s 0.23 regarding use of unpublished opinions)

Appeal from the United States District Court for the Southern District of New York, Robert P. Patterson, Jr., Judge.

David B. Cohen, Speno & Cohen, LLP, New York, N.Y.; Sarah R. Speno, of counsel, for appellants.

Lyndon M. Tretter, Davis Weber & Edwards P.C., New York, N.Y.; Emily Granrud, of counsel, for appellee Fonix Corp.

Martin P. Russo, MPR Law Practice, New York, N.Y.; Jason M. Ewasko, of counsel, for appellees Hicks, Southridge Capital and Sovereign Partners.

Present JACOBS, CALABRESI, and STRAUB, Circuit Judges.

AFTER ARGUMENT AND UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED AND DECREED that the judgment of the District Court is hereby AFFIRMED.

Plaintiffs John R. Clarke and Perpetual Growth Funds Advisors, Inc. (collectively "plaintiffs") appeal from an order of the United States District Court for the Southern District of New York (Robert P. Patterson, Jr., Judge), declining to reinstate the action against defendant Fonix Corporation, due to lack of personal jurisdiction and, in the alternative, venue, and granting the motion of defendants Hicks, Southridge Capital Management, LLC, and Sovereign Partners, L.P. (collectively "Hicks") to dismiss for lack of personal jurisdiction.

The dispute arises out of an agreement entered into between plaintiffs and Fonix on February 25, 1998 ("Agreement"), providing for payment of a 5% commission fee to the plaintiffs "at closing of a financing between Fonix ... and an investor that is a result of an introduction by" plaintiffs. In early 1998, Hicks invested $10 million in Fonix, for which the plaintiffs were paid $500,000 in commissions, as agreed by the parties. According to the plaintiffs, however, Fonix breached the Agreement by not paying them commissions for all subsequent investments in Fonix made by Hicks, and Hicks tortiously interfered with the Agreement.

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