Afunday Charters, Inc. v. Spencer Yachts, Inc.

• Decision Date: 02 August 2017
• Docket Number: CIVIL NO. 16–3141 (GAG)
• Citation: 261 F.Supp.3d 257
• Parties: AFUNDAY CHARTERS, INC., Plaintiff, v. SPENCER YACHTS, INC., et al., Defendants.
• Court: U.S. District Court — District of Puerto Rico

261 F.Supp.3d 257

AFUNDAY CHARTERS, INC., Plaintiff,
v.
SPENCER YACHTS, INC., et al., Defendants.

CIVIL NO. 16–3141 (GAG)

United States District Court, D. Puerto Rico.

Signed August 2, 2017

Paul E. Calvesbert–Borgos, Calvesbert Law Offices PSC, Eduardo R. Jenks–Carballeira, Guaynabo, PR, Michael T. Moore, Lars Altman, Moore & Co., P.A., Coral Gables, FL, for Plaintiff.

Alexander Selarnick, David Y. Loh, New York, NY, Manolo T. Rodriguez–Bird, Jimenez, Graffam & Lausell, Alberto J. Castaner–Padro, III, Castaner Law Offices P.S.C., San Juan, PR, James W. Stroup, Stroup & Martin, P.A., Fort Lauderdale, FL, for Defendants.

OPINION AND ORDER

GUSTAVO A. GELPI, UNITED STATES DISTRICT JUDGE

Afunday Charters, Inc. ("Afunday Charters" or "Plaintiff") filed the present action against Spencer Yachts, Inc. ("Spencer Yachts"), Joseph Daniel Spencer ("Daniel Spencer"),¹ (collectively "Defendants") seeking redress for injuries suffered as a result of the total loss of a Spencer 74' Custom Sport Fish Convertible named "AFUNDAY", a fiberglass sport fishing yacht ("Vessel"), during the course of the Vessel's transfer from North Carolina to Trinidad and Tobago. (Docket No. 1.) Defendants moved to dismiss the Complaint for lack of personal jurisdiction and forum non conveniens . (See Docket Nos. 19, 20.)

After considering the parties' filings and applicable law, the Court DENIES Defendants' Motion to Dismiss.

I. Relevant Factual & Procedural Background

Plaintiff is a Delaware corporation that was the owner of the Vessel. (Docket No. 1 ¶ 1). Co-defendant Spencer Yachts is a North Carolina corporation that specializes in custom boat building and marine services. Id. ¶ 2. Co-defendant Daniel Spencer is an employee of Spencer Yachts who was

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acting as an agent of Spencer Yachts at the time of the incident. Id. ¶ 3.

On January 1, 2014, Anthony Norman Sabga ("Norman Sabga"), a beneficial owner of Afunday Charters, entered into a Contract Price Purchase Agreement ("Purchase Agreement") with Spencer Yachts in his individual capacity. (Docket No. 1 ¶ 7; 24 at 1.) Plaintiff is not a party in the Purchase Agreement. (Docket No. 24 at 1.) Under this Purchase Agreement, Spencer Yachts would construct and sell the Vessel by July 2015. (Docket No. 1 ¶¶ 7–8.) Because of multiple delays by Spencer Yachts, the Vessel was available for delivery in December 2015. Id. ¶ 9.

Spencer Yachts later agreed to have Daniel Spencer serve as captain of the Vessel from North Carolina, the place of its construction, to Trinidad and Tobago, the country of Norman Sabga. Id. ¶ 10. Chris Blanchard, a Spencer Yachts employee, served as engineer/mechanic during the voyage. (Docket No. 24 at 2.) The Vessel departed from North Carolina on December 30, 2016. (Docket No. 1 ¶ 11.) On January 11, 2016, Daniel Spencer changed course for Fajardo, Puerto Rico, instead of going to the planned intermediate destination of St. Maarten. Id. ¶ 16. Daniel Spencer and Chris Blanchard decided to travel to Fajardo, Puerto Rico for two reasons: to deliver air conditioning parts to the captain of another boat built by Spencer Yachts, and to have a company called Island Marine, Inc. ("Island Marine") repair the Vessel's tie bar. (Docket No. 24 at 3–4.)

On January 12, 2016, the Vessel docked in Fajardo, Puerto Rico at the Puerto Del Rey Marina. (Docket No. 1 ¶ 17.) While in Puerto Rico, Daniel Spencer and/or Chris Blanchard delivered parts to a captain of another yacht built by Spencer Yachts. Id. ¶ 18. Chris Blanchard also took the Vessel's tie bar rudder to Island Marine, a Puerto Rican business, for repair. Id. ¶ 19.

At approximately 5:00 AM on January 14, 2016, while it was still dark, Daniel Spencer captained the Vessel out of the Puerto Del Rey Marina and into open waters. Id. ¶ 20. Daniel Spencer did so to arrive in St. Lucia before nightfall. Id. Daniel Spencer, who was not familiar with Puerto Rico's coastal waters, then crashed the Vessel into the "Roca Lavandera Del Oeste," a rock shoal that was clearly marked on the Vessel's GPS unit. Id. ¶¶ 21, 24, 26–27. The collision fractured the Vessel's hull, causing it to begin taking water. Id. ¶ 30. Shortly after Daniel Spencer called the U.S. Coast Guard, the Puerto Rican Joint Forces of Rapid Action ("marine police") arrived on scene, and saved the crew of the Vessel. (Docket No. 24 at 5.) During this time, East Towing and Salvage, Inc. ("SeaTow Puerto Rico") provided salvage services on the Vessel and towed it. Id.

Plaintiff filed the present suit on December 13, 2016 to recover for substantial damages allegedly caused by Spencer Yachts' and Daniel Spencer's negligence. (Docket No. 24 at 5.) Defendants then filed a Motion to Dismiss Afunday Charter's Complaint based on a lack of personal jurisdiction and forum non conveniens . (Docket No. 19.) They contend the Court may not exercise personal jurisdiction over Spencer Yachts because Spencer Yachts does not have the requisite contacts to satisfy a constitutional due process analysis. Id. at 1–2. Defendants assert that the facts of the case have no relationship to Puerto Rico because neither the witnesses nor the parties reside there, and no relevant evidence is located there. Id. at 2. Defendants also argue that the Purchase Agreement contained a forum selection clause which mandates that any legal claims arising out of the agreement shall be heard in North Carolina. Id.

Plaintiff opposed, arguing that Spencer Yachts' contacts with Puerto Rico are sufficient

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to subject Spencer Yachts to this Court's jurisdiction. (Docket No. 24 at 7.) Plaintiff contends that the claim underlying the litigation directly arises out of Spencer Yachts' forum-state activities, Spencer Yachts purposefully availed itself of the privilege of conducting activities in Puerto Rico, and it was reasonably foreseeable that Defendants would be hailed into Puerto Rican courts. Id. at 7, 9. Plaintiff also asserts that the exercise of jurisdiction is reasonable under Frist Circuit jurisprudence. Id. at 12. Furthermore, Plaintiff argues that the forum selection clause contained in the Purchase Agreement does not bind Plaintiff because not only is Plaintiff not a party to this contract, the contract was never assigned to Plaintiff. Id. at 15.

Defendants replied, reiterating that Plaintiff is bound by the forum selection clause and that exclusive jurisdiction pertains to Dare County, North Carolina. (Docket No. 31 at 2–3.) Moreover, Defendants assert that the Purchase Agreement was intended to apply to all claims growing out of the parties' relationship, not merely those related to the construction of the Vessel. Id. at 7.

Plaintiff filed a sur-reply, arguing that the movement of the Vessel from North Carolina to Trinidad and Tobago, with a stop in Puerto Rico, is part of a separate agreement that was not memorialized in writing and to which the forum selection clause would not apply. (Docket No. 37, at 3–4.)

II. Standard of Review

In considering a motion to dismiss, the court accepts the complaint's alleged facts as true and draws all reasonable inferences in favor of the plaintiff. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). However, "the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. (citing Twombly, 550 U.S. at 555, 127 S.Ct. 1955 ). Instead, a court must determine whether the complaint, construed in the proper light, "alleges facts sufficient to make out a cognizable claim." Carroll v. Xerox Corp. , 294 F.3d 231, 241 (1st Cir. 2002). The court may also draw from undisputed court documents generated in proceedings referenced in the complaint. See Prisma Zona Exploratoria de P.R. v. Calderón , 310 F.3d 1, 2 (1st Cir. 2002).

Federal Rule of Civil Procedure 12(b)(2) is the proper procedural mechanism through which a defendant may request dismissal of an action asserted against him for lack of personal jurisdiction. A district court may rule on a 12(b)(2) motion without holding an evidentiary hearing by employing a "prima facie standard". See United States v. Swiss Am. Bank, Ltd., 274 F.3d 610, 618 (1st Cir. 2001).

To establish personal jurisdiction, the plaintiff must plead enough facts to support a prima facie case consistent with Puerto Rico's long-arm statute and the U.S. Constitution's Due Process Clause. See Rodriguez v. Fullerton Tires Corp., 115 F.3d 81, 84 (1st Cir. 1997). Puerto Rico's long-arm statute is "coextensive with the reach of the Due Process Clause." Carreras v. PMG Collins, LLC., 660 F.3d 549, 552 (1st Cir. 2011). The court thus proceeds directly to the constitutional analysis. See Portugues v. Venable LLP, 497 F.Supp.2d 295, 298 (D.P.R. 2007).

III. Discussion

A. Personal Jurisdiction

There are two types of personal jurisdiction that conform with due process:

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general and...