Rusakiewicz v. Lowe

• Citation: 556 F.3d 1095
• Decision Date: 24 February 2009
• Docket Number: No. 07-4289.,07-4289.
• Parties: Ron RUSAKIEWICZ and Paul Spera, Plaintiffs-Appellants, v. John LOWE, David Norris, Sr., Shirley Shaw, John P. Wolfe, and the Veterans of Foreign Wars of the United States, Department of California, Defendants-Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (10th Circuit)

556 F.3d 1095

Ron RUSAKIEWICZ and Paul Spera, Plaintiffs-Appellants, v. John LOWE, David Norris, Sr., Shirley Shaw, John P. Wolfe, and the Veterans of Foreign Wars of the United States, Department of California, Defendants-Appellees.

No. 07-4289.

United States Court of Appeals, Tenth Circuit.

February 24, 2009.

Gregory W. Stevens, Attorney at Law, Salt Lake City, UT, for Plaintiffs-Appellants.

David N. Kelly (Rachel G. Terry with him on the brief), Fabian & Clendenin, Salt Lake City, UT, for Defendants-Appellees.

Before McCONNELL, EBEL, and GORSUCH, Circuit Judges.

McCONNELL, Circuit Judge.

Ron Rusakiewicz and Paul Spera, the plaintiffs and appellants in this case, are or were members of the Veterans of Foreign Wars of the United States (VFW). They distributed fliers at the 2005 VFW convention in Salt Lake City accusing defendant-appellee John Lowe and other officers of the California Department of the organization of fraud in connection with the organization's membership rolls. Mr. Lowe sued Mr. Rusakiewicz and Mr. Spera for defamation in state court in Utah. The defamation suit was later dismissed with prejudice by agreement of the parties. Mr. Rusakiewicz and Mr. Spera then filed this suit against Mr. Lowe and other officers of the California Department of the VFW, claiming that the defamation suit amounted to abuse of the legal process and unlawful use of civil proceedings. The district court dismissed their complaint, holding that the court did not have personal jurisdiction over the individual defendants other than Mr. Lowe and that the complaint did not state a claim for which relief may be granted. Mr. Rusakiewicz and Mr. Spera appeal. We reverse the district court's holding as regards jurisdiction. We affirm its dismissal of the abuse of process and wrongful use of civil proceedings claims.

I. FACTUAL AND PROCEDURAL BACKGROUND

In August 2005, Mr. Rusakiewicz and Mr. Spera attended a VFW conference in Salt Lake City, Utah. There they distributed fliers making accusations of fraud and misconduct against some individual officers of the California Department of Veterans of Foreign Wars (VFWCA). The fliers claimed that some VFWCA officers had hacked into computers at the National VFW and converted the names of some National VFW members into VFWCA members-improperly augmenting the member rolls (and the coffers) of the VFWCA. John Lowe, one of those accused, served a complaint on the two men, maintaining that he had been defamed and asking for damages. Before filing suit, Mr. Lowe consulted with other officers of the VFWCA in Salt Lake City about the suit. The other officers, including defendants-appellees Shirley Shaw, David Norris, and John Wolfe, offered their support to Mr. Lowe regarding his lawsuit and agreed to use VFWCA funds to pay Mr. Lowe's legal expenses. Mr. Lowe, however, was the sole plaintiff in that suit.

Mr. Lowe attempted to reach a "compromise agreement" with Mr. Rusakiewicz and Mr. Spera. He proposed that the two men agree to "make no comments or communication of any nature" relating to "alleged criminal action or other violations of the law" in connection with the VFW membership matter, in return for his dropping his suit for damages. Mr. Rusakiewicz and Mr. Spera rejected the proposed compromise agreement. After some back and forth, and with consent from the defamation defendants, Mr. Lowe later voluntarily dismissed his complaint with prejudice.

Several months after the defamation action was dismissed, Mr. Rusakiewicz and Mr. Spera filed a complaint for damages against Mr. Lowe in the United States District Court for the District of Utah, alleging that his defamation suit was an abuse of process and an unlawful use of civil proceedings. The plaintiffs joined Ms. Shaw, Mr. Norris, Mr. Wolfe, and the VFWCA as defendants for allegedly "authorizing], approv[ing], ratify[ing], and/or instituting] the wrongful civil action" of Mr. Lowe's. The jurisdictional basis for the lawsuit was diversity of citizenship, under 28 U.S.C. § 1332(a)(1). Mr. Rusakiewicz and Mr. Spera are citizens of Connecticut and Massachusetts, respectively, Mr. Lowe and the other VFWCA officers are citizens of California, and the VFWCA is incorporated in California. The defendants filed a motion to dismiss, asserting lack of personal jurisdiction over Ms. Shaw, Mr. Norris, and Mr. Wolfe (whom we will generally call "the VFWCA defendants"), and contending that the complaint had failed to state a claim for abuse of process and unlawful use of civil proceedings under Utah common law. They did not contest the court's jurisdiction with respect to Mr. Lowe or the VFWCA.

The district court granted the motion to dismiss, finding it lacked jurisdiction over the VFWCA defendants. The district judge said to plaintiffs' counsel below that if he

had the facts to support some notion that they [Ms. Shaw, Mr. Norris, and Mr. Wolfe] were colluding with Mr. Lowe to file a baseless lawsuit in Salt Lake, well, then there would be jurisdiction over them. There would be enough information to suggest that they committed a tort [in Utah], at least enough basis for going forward.... But I didn't see that you have anything like that.

R. 118.

With respect to the claims against the remaining defendants, Mr. Lowe and the VFWCA, the court held that there was an "insufficient legal basis to support either a claim for abuse of process or a claim for unlawful use of civil proceedings." The court explained that the claim for abuse of process "fail[ed] for lack of an allegation of a wilful act independent of the legal process" and that the claim for unlawful use of civil proceedings failed "because the prior case was not terminated on the merits" in favor of Mr. Rusakiewicz and Mr. Spera.

II. JURISDICTION

We review de novo the district court's finding that it lacked jurisdiction over the VFWCA defendants Ms. Shaw, Mr. Norris, and Mr. Wolfe. Pro Axess, Inc. v. Orlux Distribution, Inc., 428 F.3d 1270, 1276 (10th Cir.2005). "Where ... there has been no evidentiary hearing," as in this case, "and the motion to dismiss for lack of jurisdiction is decided on the basis of affidavits and other written material, the plaintiff need only make a prima facie showing that jurisdiction exists." Elec. Realty Assocs., L.P. v. Vaughan Real Estate, 897 F.Supp. 521, 522 (D.Kan.1995); see also Soma Med. Int'l v. Standard Chartered Bank, 196 F.3d 1292, 1295 (10th Cir.1999). All factual disputes are resolved in favor of the plaintiffs when determining the sufficiency of this showing. Wenz v. Memery Crystal, 55 F.3d 1503, 1505 (10th Cir.1995).

To establish personal jurisdiction over the VFWCA defendants, the plaintiffs had to show, first, that jurisdiction is authorized under Utah law and, second, that the exercise of jurisdiction does not offend the due process clause of the Fourteenth Amendment. Far West Capital, Inc. v. Towne, 46 F.3d 1071, 1074 (10th Cir.1995). The defendants initially try to make the case that jurisdiction over the VFWCA defendants is barred under Utah law because the "purpose" of Utah's long-arm statute is to protect Utah citizens and residents, and no party to the present litigation is a Utah citizen or resident. This attempt is unavailing.

It is true that Utah's long-arm statute has a "purpose" clause that states that the provisions of the long-arm statute are intended "to ensure maximum protection to citizens of" Utah. Utah Code Ann.1953 § 78B-3-201(3) (emphasis added). But the remainder of that clause says that the provisions of the statute should be applied "so as to assert jurisdiction over nonresident defendants to the fullest extent" permitted by the Fourteenth Amendment of the U.S. Constitution. And the Utah Supreme Court has explicitly said that "any set of circumstances that satisfied due process will also satisfy the long-arm statute." SII MegaDiamond, Inc. v. Am. Superabrasives Corp., 969 P.2d 430, 433 (Utah 1998). This collapses the Utah standard into the more general "due process" standard for jurisdiction. As we have put it before, our jurisdictional inquiry in Utah diversity cases is reduced to a single question: did the defendants have sufficient "minimum contacts" with the state of Utah to establish personal jurisdiction over them? Fidelity & Cas. Co. of New York v. Philadelphia Resins Corp., 766 F.2d 440, 442 (10th Cir.1985).¹ We conclude that they did.

The plaintiffs point to the minutes of a January 2007 VFWCA meeting at which the organization's Deputy Advocate stated that the defamation suit "was approved in an Ad Hoc meeting in Salt Lake City by all of the officers then present." He stated that the "Department" (meaning the VFWCA) "paid for" the filing of the lawsuit. Mr. Lowe admitted that he had spoken with the VFWCA defendants about filing the lawsuit. These defendants were all present at the VFWCA meeting, they were all officers, they all voted to fund the lawsuit, and they more generally "authorized" and "approved" of it.

We start the due process/minimum contacts analysis by seeking to find "some act by which the defendant[s] purposefully avail[ed] [themselves] of the privilege of conducting activities within the forum State[.]" Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985). Merely "random, fortuitous or attenuated contacts" will not be sufficient to establish jurisdiction. Id. (internal citations omitted). It appears that the contacts the VFWCA defendants made were neither random nor fortuitous nor attenuated.

It is well established that the act of filing a lawsuit in a particular state is sufficient to establish jurisdiction over the plaintiff in the courts of that state in a subsequent action for abuse of process or similar torts. See Neuralstem, Inc. v. StemCells, Inc., 573 F.Supp.2d 888, 897-98 (D.Md.2008) (collecting cases in which a party "essentially consents" to jurisdiction in the forum state through the "act of filing a previous suit where the...