Anne Carlsen Center v. Government of U.S. VI
| Decision Date | 16 February 2005 |
| Docket Number | No. A1-04-098.,A1-04-098. |
| Citation | 356 F.Supp.2d 1023 |
| Parties | ANNE CARLSEN CENTER FOR CHILDREN, Plaintiff, v. GOVERNMENT OF THE UNITED STATES VIRGIN ISLANDS, Defendant. |
| Court | U.S. District Court — District of North Dakota |
Timothy D. Lervick, Schulz Lervick & Geierman, Bismarck, ND, for Plaintiff.
Cameron W. Hayden, U.S. Attorney's Office, Bismarck, ND, Gina Harrison, Virgin Islands Dept of Justice Assistant Attorney General, St Thomas, VI, for Defendant.
ORDER DENYING DEFENDANT'S MOTION TO DISMISS
Before the Court is the Defendant's motion captioned "Defendant's Motion to Dismiss or, in the Alternative, Defendant's Motion for Summary Judgment" filed on October 12, 2004. The Plaintiff filed a response opposing the motion on January 3, 2005.1 The Plaintiff also filed a request for oral argument. For the reasons outlined below, the Defendant's motion is denied.
The plaintiff, Anne Carlsen Center for Children (hereinafter referred to as Anne Carlsen), is a licensed intermediate care facility for the developmentally disabled and a school located in Jamestown, North Dakota. It "provides medical services, residential services, rehabilitation services and educational services, among other things." See Complaint, ¶ 5.
Prior to July 1, 2003, the facility was owned and operated by Banner Health. On July 1, 2003, Banner Health donated the facility to Anne Carlsen, which has operated the facility since that time. See Complaint, ¶ 6. Banner Health was formerly known as Banner Health System, and together they operated the facility under the name Anne Carlsen Center for Children. See Complaint, ¶ 7.
Banner Health entered into three separate contracts with the defendant, the Government of the United States, Virgin Islands, to provide various medical, educational and related services to three Virgin Islands residents; Fitzroy Joseph, Terrence Leonard and Shakejah Smith. See Affidavit of Dan Howell, ¶ 6. In turn, the Virgin Islands agreed to pay for those services. See Complaint, ¶¶ 8-9. The contractual history as to each child is unique.
Shakejah Smith was admitted to Anne Carlsen on August 27, 1991. Annual contracts were signed by Banner Health and the Virgin Islands for consecutive annual periods from September 1992 through September 2002. In the fall of 2002, another contract was prepared for an additional year of service to end on September 30, 2003. See Affidavit of Dan Howell, ¶ 9. However, on May 13, 2004, the CEO of Anne Carlsen, Dan Howell, received a letter from the Virgin Islands informing him that the most recent contract for Shakejah could not be processed and enclosed a new contract. See Plaintiff's Ex. B. The Virgin Islands stated that it was unable to process the contract because it "must now justify the services as having been rendered." Id. As a result, the new contract "will become effective upon signature of the Governor of the Virgin Islands." Howell signed the new contract and returned it to the Virgin Islands on May 19, 2004. The Governor never signed the contract. Shakejah graduated from Anne Carlsen on May 22, 2004. No payments have been made for the services provided to Shakejah from October 1, 2002 through May 22, 2004. The amount owed for services over that time period is $244,900.50. See Affidavit of Dan Howell, ¶ 9.
Fitzroy Joseph was admitted to Anne Carlsen on July 10, 2002. See Affidavit of Dan Howell, ¶ 10. A contract for Fitzroy's care was prepared for a period ending on September 30, 2003. See Affidavit of Dan Howell, ¶ 11. On May 13, 2003, the same letter was received from the Virgin Islands explaining that it was unable to process the contract for Fitzroy and submitted a new contract. See Plaintiff's Ex. D. Howell signed the new contract and returned it to the Virgin Islands on May 19, 2004. The Governor never signed the contract. Fitzroy was discharged from Anne Carlsen on July 8, 2004. No payments have been made for the services provided to Fitzroy from July 10, 2002 through July 8, 2004. The amount owed for services over that time period is $171,171.11. See Affidavit of Dan Howell, ¶ 11.
Lastly, Terrance Leonard was admitted to Anne Carlsen on August 13, 2001. A contract for the provision of services to Terrance was prepared and signed for the time period of August 13, 2001 through September 30, 2002. See Affidavit of Dan Howell, ¶ 12. As with the others, a contract was prepared for an additional year of service to end on September 30, 2003. See Affidavit of Dan Howell, ¶ 13. Once again, on May 13, 2004, the letter was received from the Virgin Islands along with a new contract. See Plaintiff's Ex. F. Howell signed the new contract and returned it to the Virgin Islands on May 19, 2004. However, a third contract for Terrance's care for the contract period from October 1, 2002 through September 30, 2004, was sent to Howell from the Virgin Islands. Howell signed and returned it to the Virgin Islands on June 24, 2004. The third contract was later signed by Marc Biggs, Commissioner of Property and Procurement, Noreen Michael, Commissioner of Education, and Charles W. Turnbull, Governor of the Virgin Islands. Terrance is still presently housed at Anne Carlsen. The Virgin Islands owed $305,643.25 for services provided to Terrance as of August 4, 2004. See Affidavit of Dan Howell, ¶ 13.
On August 4, 2004, Anne Carlsen filed an action in the United States District Court for the District of North Dakota, against the Government of the United States, Virgin Islands, seeking $721,714.86 for services rendered under the three contracts.2
The Defendant seeks dismissal for lack of personal jurisdiction and lack of subject matter jurisdiction. In the alternative the Defendant seeks summary judgment.
The initial inquiry is whether the Court has personal jurisdiction over the Defendant. The Motion to Dismiss was filed pursuant to Rule 12(b)(2) of the Federal Rules of Civil Procedure for lack of jurisdiction over the party. "To defeat a motion to dismiss for lack of personal jurisdiction, the nonmoving party need only make a prima facie showing of jurisdiction." Epps v. Stewart Information Services Corp., 327 F.3d 642, 647 (8th Cir.2003) (citing Falkirk Min. Co. v. Japan Steel Works, Ltd., 906 F.2d 369, 373 (8th Cir.1990); Watlow Elec. Mfg. v. Patch Rubber Co., 838 F.2d 999, 1000 (8th Cir.1988)). "The plaintiff's prima facie showing must be tested, not by the pleadings alone, but by the affidavits and exhibits presented with the motions and in opposition thereto." Dever v. Hentzen Coatings, Inc., 380 F.3d 1070, 1072 (8th Cir.2004). The party seeking to establish the court's in personam jurisdiction carries the burden of proof, and the burden does not shift to the party challenging jurisdiction. Epps, 327 F.3d 642, 647 (citations omitted).
As a preliminary matter, it should be noted that this action is in federal court based on diversity jurisdiction. See 28 U.S.C. § 1332(a). Under Rule 4(k)(1)(A) of the Federal Rules of Civil Procedure, a federal district court in a diversity action will have personal jurisdiction to the same extent as a state court of the state in which that federal district court sits. Dean v. Olibas, 129 F.3d 1001, 1003 (8th Cir.1997). Therefore, when this Court sits in diversity, the analysis for personal jurisdiction involves two steps: (1) the court must determine whether the State of North Dakota would accept jurisdiction under the facts of this case; and (2) the court must determine whether the exercise of jurisdiction comports with constitutional due process restrictions. Lakin v. Prudential Securities, Inc., 348 F.3d 704, 706-707 (8th Cir.2003) (citing Sondergard v. Miles, Inc., 985 F.2d 1389, 1392 (8th Cir.1993)). To satisfy the first step of the jurisdictional analysis, the Court will address the relevant North Dakota provisions governing personal jurisdiction over non-resident defendants.
The jurisdiction of North Dakota courts is governed by the North Dakota long-arm statute set forth in Rule 4(b)(2) of the North Dakota Rules of Civil Procedure. The North Dakota Supreme Court has held that Rule 4(b)(2) "authorizes North Dakota courts to exercise jurisdiction over nonresident defendants to the fullest extent permitted by due process...." Hansen v. Scott, 645 N.W.2d 223, 230 (N.D.2002) (citing Auction Effertz, Ltd. v Schecher, 611 N.W.2d 173 (N.D.2000); Hust v. Northern Log, Inc., 297 N.W.2d 429, 431 (N.D.1980)). The Eighth Circuit has held that when a state construes its long-arm statute to grant jurisdiction to the fullest extent permitted by the Constitution, the two-step test collapses into a single question of whether the exercise of personal jurisdiction comports with due process. Oriental Trading Co., Inc. v. Firetti, 236 F.3d 938, 943 (8th Cir.2001); Bell Paper Box, Inc. v. U.S. Kids, Inc., 22 F.3d 816, 818 (8th Cir.1994); see Hansen v. Scott, 645 N.W.2d 223, 232 (N.D.2002).
The Eighth Circuit has explained the requirements of the due process clause as follows:
Due process requires that there be sufficient "minimum contacts" between the nonresident defendant and the forum state such that the "maintenance of the suit does not offend the traditional notions of fair play and substantial justice." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 291-92, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980). Sufficient minimum contacts exist when the "defendant's conduct and connection with the forum state are such that he or she should reasonably anticipate being haled into court there." Id. at 297, 100 S.Ct. 559. In assessing the defendant's reasonable anticipation, "it is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws." Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 2...
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