667 F.3d 705 (6th Cir. 2012), 10-3526, Conn v. Zakharov
|Citation:||667 F.3d 705|
|Opinion Judge:||ALICE M. BATCHELDER, Chief Judge.|
|Party Name:||Richard A. CONN, Jr., Plaintiff-Appellant, v. Vladimir ZAKHAROV, Defendant-Appellee.|
|Attorney:||Bruce S. Marks, Marks & Sokolov, LLC, Philadelphia, Pennsylvania, for Appellant. Leonard J. Marsico, McGuire Woods LLP, Pittsburgh, Pennsylvania, for Appellee. Bruce S. Marks, Marks & Sokolov, LLC, Philadelphia, Pennsylvania, for Appellant. Leonard J. Marsico, McGuire Woods LLP, Pittsburgh, Penns...|
|Judge Panel:||Before: BATCHELDER, Chief Judge; SILER and COLE, Circuit Judges.|
|Case Date:||January 12, 2012|
|Court:||United States Courts of Appeals, Court of Appeals for the Sixth Circuit|
Argued: Oct. 11, 2011.
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An old Russian proverb states, " If you're afraid of wolves, don't go into the forest." For Appellant Richard A. Conn. the proverb might well read, " If you're afraid of the Russian legal system, don't do business in Russia." Conn. brought this action against Appellee Vladimir Zakharov for breach of contract, a contract that Conn. moved to Russia to perform. Conn. chose the Northern District of Ohio as the forum for the suit because Zakharov owns property there and because Conn. believed he would not prevail in a Russian court of law. The district court ruled that it did not have personal jurisdiction under Ohio law and dismissed the case. We AFFIRM because under the facts of this case both Ohio law and the Due Process Clause proscribes the district court from finding general personal jurisdiction over Zakharov.
The merits of Conn's case against Zakharov are not before this Court, as even Conn. admits that the purported contract has no connection to the state of Ohio. Suffice it to say that Conn. believes that he came to an agreement with Zakharov in which Conn. would gain a fifteen percent share of a proposed venture by Zakharov's company, that Conn. moved to Russia to perform on the agreement, that Zakharov later repudiated the agreement, and that Conn. moved back to the United States.
More relevant to this appeal is the history that Zakharov— a Russian citizen— has with Ohio. He attended graduate school at Case Western Reserve University in University Heights, Ohio, and graduated with an MBA in 2002. Zakharov and his wife own residential real estate in Pepper Pike, Ohio, that Zakharov apparently spent millions of dollars purchasing and improving. Zakharov owns several vehicles registered in Ohio, maintains a bank account in Ohio, and maintains the Pepper Pike properties year-round. He also spends some time in Ohio each year, ranging from forty days in 2007 to a total of seventeen days in 2008-2009. In 2008, he even spent $10,000 on Christmas decorations at the Pepper Pike residence, according to documents unearthed by Conn.
After returning from Russia, and motivated by Zakharov's property ownership in Ohio, Conn. brought this action in the United States District Court for the Northern District of Ohio, claiming breach of contract and seeking an accounting for the value of a fifteen percent share of the Russian venture. Zakharov moved to dismiss the Complaint under Federal Rule of Civil Procedure 12(b)(2) for lack of personal jurisdiction, but also under Rules 12(b)(2) and 12(b)(6) for forum non conveniens and failure to state a claim, respectively. After completion of discovery on the personal jurisdiction issue, and after " exhaustive" briefing of the issues by the parties, the district court granted Zakharov's motion to dismiss for lack of personal jurisdiction.1 In essence, the district court held that Zakharov was not an Ohio resident, that he was not served with process in a manner that automatically confers personal jurisdiction, that Ohio law did not recognize general jurisdiction over non-residents such as Zakharov, and that Ohio's long-arm statute did not confer personal jurisdiction over Zakharov. Conn. filed a timely appeal to this Court.
" A federal court sitting in diversity may not exercise jurisdiction over a defendant unless courts of the forum state would be authorized to do so by state law— and any such exercise of jurisdiction must be compatible with the due process requirements of the United States Constitution." Int'l Techs. Consultants v. Euroglas S.A., 107 F.3d 386, 391 (6th Cir.1997) (citation omitted). Deciding whether jurisdiction exists is not an idle or perfunctory inquiry; due process demands that parties have sufficient contacts with the forum state so that it is fair to subject them to jurisdiction. See Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985) (" [T]he Due Process Clause gives a degree of predictability to the legal system that allows potential defendants to structure their primary conduct with some minimum assurance as to where that conduct will and will not render them liable to suit." (internal quotation marks and citations omitted)). The court's jurisdiction accordingly extends only to those parties who have in some fashion placed themselves in the hands of the tribunal. See, e.g., Kerry Steel, Inc. v. Paragon Indus., Inc., 106 F.3d 147, 150 (6th Cir.1997) (" To be subject to in personam jurisdiction ... a defendant must purposefully avail [ ] itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws." (internal quotation marks and citation omitted) (alteration in the original)). Practically speaking, plaintiffs always concede personal jurisdiction, so the inquiry is typically restricted to defendants; because defendants who reside in the forum state will always be subject to the personal jurisdiction of the court, the inquiry is in most cases further restricted to non-resident defendants.
The plaintiff bears the burden of establishing through " specific facts" that personal jurisdiction exists over the non-resident defendant, and the plaintiff must make this demonstration by a preponderance of the evidence. See Kroger Co. v. Malease Foods Corp., 437 F.3d 506, 510 & n. 3 (6th Cir.2006); Theunissen v. Matthews, 935 F.2d 1454, 1458 (6th Cir.1991). But where, as here, the defendant has moved to dismiss the case under Rule 12(b)(2) for lack of personal jurisdiction and the district court rules on the motion without an evidentiary hearing, the plaintiff need only make a " prima facie" case that the court has personal jurisdiction. Kroger, 437 F.3d at 510. In this procedural posture, we do not weigh the facts disputed by the parties but instead consider the pleadings in the light most favorable to the plaintiff, although we may consider the defendant's undisputed factual assertions. See Kerry Steel, 106 F.3d at 153; CompuServe, Inc. v. Patterson, 89 F.3d 1257, 1261-62 (6th Cir.1996). But also where, as here, " the plaintiff has received all of the discovery it sought with respect to personal jurisdiction and there does not appear to be any real dispute over the facts relating to jurisdiction," the prima facie " proposition loses some of its significance." Euroglas S.A., 107 F.3d at 391.
We review de novo a district court's dismissal of the case under Rule 12(b)(2) for lack of personal jurisdiction. See, e.g., Kroger, 437 F.3d at 510. Accordingly, we will not conclude that the district court in Ohio has personal jurisdiction over Zakharov unless Conn. presents a prima facie case that: (1) jurisdiction is proper under a long-arm statute or other jurisdictional rule of Ohio, the forum state; and (2) the Due Process Clause also allows for jurisdiction under the facts of the case. See, e.g., CompuServe, 89 F.3d at 1262. Of course, if jurisdiction is not proper under
the Due Process Clause it is unnecessary to analyze jurisdiction under the state long-arm statute, and vice-versa. See Brunner v. Hampson, 441 F.3d 457, 467 (6th Cir.2006) (holding that where the plaintiff cannot show jurisdiction under the Ohio long-arm statute a Due Process analysis is unnecessary); Calphalon Corp. v. Rowlette, 228 F.3d 718, 721, 724 (6th Cir.2000) (dismissing for lack of personal jurisdiction solely on Due Process grounds).
Under Ohio law, personal jurisdiction over non-resident defendants is available only if (1) the long-arm statute confers jurisdiction and (2) jurisdiction is proper under the Federal Due Process Clause. See Kauffman Racing Equip., L.L.C. v. Roberts, 126 Ohio St.3d 81, 930 N.E.2d 784, 790 (2010); Goldstein v. Christiansen, 70 Ohio St.3d 232, 638 N.E.2d 541, 543 (1994). Unlike other jurisdictions, Ohio does not have a long-arm statute that reaches to the limits of the Due Process Clause, and the analysis of Ohio's long-arm statute is a particularized inquiry wholly separate from the analysis of Federal Due Process law. Compare Goldstein, 638 N.E.2d at 545 & n. 1 (holding that Ohio's long-arm statute does not reach to limits of the Due Process Clause), and Brunner, 441 F.3d at 465 (recognizing same), with Dean v. Motel 6 Operating L.P., 134 F.3d 1269, 1273 (6th Cir.1998) (noting that because Kentucky's long-arm statute reaches to the limit of the Constitution the only issue is whether jurisdiction " is within the requirements of due process" ), and Intera Corp. v. Henderson, 428 F.3d 605, 616 (6th Cir.2005) (affirming that Tennessee's long-arm statute is " coterminous" with Due Process). Ohio's long-arm statute grants Ohio courts personal jurisdiction over a non-resident if his conduct falls within the nine bases for jurisdiction listed by the statute. See OHIO REV.CODE ANN. § 2307.382(A), (C) (1988). The statute makes clear that " [w]hen jurisdiction over a person is...
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