Boschetto v. Hansing, 06-16595.

• Decision Date: 20 August 2008
• Docket Number: No. 06-16595.,06-16595.
• Citation: 539 F.3d 1011
• Parties: Paul BOSCHETTO, Plaintiff-Appellant, v. Jeffrey D. HANSING; Frank-Boucher Chrysler Dodge-Jeep; Gordie Boucher Ford; Boucher Automotive Group, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

539 F.3d 1011

Paul BOSCHETTO, Plaintiff-Appellant, v. Jeffrey D. HANSING; Frank-Boucher Chrysler Dodge-Jeep; Gordie Boucher Ford; Boucher Automotive Group, Defendants-Appellees.

No. 06-16595.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted May 14, 2008.

Filed August 20, 2008.

Kenneth D. Simoncini, Esq., Simoncini & Associates, San Jose, CA, for plaintiff-appellant Paul Boschetto.

Robert G. Krohn, Esq., Roethe Krohn Pope LLP, Edgerton, WA, for defendant-appellee Jeffrey D. Hansing.

Timothy C. Davis, James Smith and Cameron Fortner, The Davis Law Firm, APC, San Francisco, CA, for defendants-appellees Frank-Boucher Chrysler Dodge-Jeep, Gordie Boucher Ford and Boucher Automotive Group.

Appeal from the United States District Court for the Northern District of California; Vaughn R. Walker, District Judge, Presiding. D.C. No. CV-06-01390-VRW.

Before: B. FLETCHER and PAMELA ANN RYMER, Circuit Judges, and KEVIN THOMAS DUFFY,^* District Judge.

Opinion by Judge BETTY B. FLETCHER; Concurrence by Judge RYMER.

BETTY B. FLETCHER, Circuit Judge:

This appeal presents a question that remains surprisingly unanswered by the circuit courts: Does the sale of an item via the eBay Internet auction site provide sufficient "minimum contacts" to support personal jurisdiction over a nonresident defendant in the buyer's forum state? Plaintiff-Appellant Paul Boschetto ("Boschetto") was the winning bidder for a 1964 Ford Galaxie sold on eBay by the Defendant-Appellee, Jeffrey Hansing ("Hansing") for $34,106. Boschetto arranged for the car to be shipped from Wisconsin to California, but upon arrival it failed to meet his expectations or the advertised description. Boschetto sued in federal court; his complaint was dismissed for lack of personal jurisdiction. We now affirm.

I. FACTUAL BACKGROUND AND PROCEDURAL HISTORY

Boschetto lives in San Francisco, California.¹ Defendant-Appellee Jeffrey D. Hansing resides in Milton, Wisconsin. Id. Defendants-Appellees Frank-Boucher Chrysler Dodge-Jeep, Gordie Boucher Ford and Boucher Automotive Group ("Boucher Defendants") are private corporations with their principal places of business in Wisconsin. The Boucher Defendants operate a website that advertises their auto dealerships although it is not alleged that this website was connected in any way with the transaction at issue in this case. Hansing is an employee of one of the Boucher Defendants, Frank Boucher Chrysler Dodge-Jeep. The complaint avers that on August 1, 2005, all Defendants "owned and advertised [] a 1964 Ford Galaxie 500 XL 427/425 hp `R Code' in awesome condition, not restored, rust free chrome in excellent condition, recently rebuilt and ready to be driven, with clear title, and a vehicle warranty number of 4E68R149127."

The car was advertised for sale on the eBay Internet auction site; a copy of a portion of the eBay listing was attached to Boschetto's complaint. Id. The eBay listing indicated that the item was located in Janesville, Wisconsin. Boschetto bid $34,106 for the Galaxie on August 8, 2005, and was notified through eBay that same day that he was the winning bidder. Id. Boschetto and Hansing communicated via email to arrange for delivery of the vehicle from Wisconsin to California. Boschetto ultimately hired a transport company to pick up the car in Wisconsin; it arrived in California on September 15, 2005. Id.

Upon delivery, Boschetto discovered that the car was not an "R Code" as advertised, and noted a variety of other problems, including a motor that would not turn over, rust, and extensive dents on the body of the vehicle. Id. Boschetto contacted eBay and Hansing in an attempt to rescind the purchase, but those efforts failed. Id. He filed a complaint in United States District Court, Northern District of California on February 23, 2006. Boschetto alleged four state law causes of action (violation of the California Consumer Protection Act; breach of contract; misrepresentation; and fraud), and pled jurisdiction pursuant to the federal diversity statute, 28 U.S.C. § 1332(a).

All Defendants moved to dismiss based on lack of personal jurisdiction. On July 13, 2006, the district court granted the motion. The district court reasoned that the lone jurisdictionally relevant contact with California, an eBay sale consummated with a California purchaser, was insufficient to establish jurisdiction over any of the Defendants. Although Hansing used eBay to market the automobile, the district court observed that "eBay acted not as a `distribution center' but rather as a virtual forum for the exchange of goods," and that in a standard eBay transaction—like the one at issue in this appeal—the item goes to whomever is the highest bidder, and so "the eBay seller does not purposefully avail himself of the privilege of doing business in a forum state absent some additional conduct directed at the forum state." Id.

The district court also rejected Boschetto's request to conduct additional discovery relevant to jurisdiction. Id. Noting its "broad discretion" to permit or deny such discovery, the court found that Boschetto's request for further discovery was premised on "speculat[ion] without any support" that the additional discovery would yield jurisdictionally relevant information. Id. Judgment was entered on July 17, 2006 and this timely appeal followed.

II. PERSONAL JURISDICTION

We review a dismissal for lack of personal jurisdiction de novo. See Myers v. Bennett Law Offices, 238 F.3d 1068, 1071 (9th Cir.2001). In opposition to a defendant's motion to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of establishing that jurisdiction is proper. See Sher v. Johnson, 911 F.2d 1357, 1361 (9th Cir.1990). If the district court decides the motion without an evidentiary hearing, which is the case here, then "the plaintiff need only make a prima facie showing of the jurisdictional facts." Id. (citation omitted). Absent an evidentiary hearing this court "only inquire[s] into whether [the plaintiff's] pleadings and affidavits make a prima facie showing of personal jurisdiction." Caruth v. Int'l Psychoanalytical Ass'n, 59 F.3d 126, 127-28 (9th Cir.1995). Uncontroverted allegations in the plaintiff's complaint must be taken as true. See AT & T, 94 F.3d at 588. "Conflicts between the parties over statements contained in affidavits must be resolved in the plaintiff's favor." Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir.2004).

When no federal statute governs personal jurisdiction, the district court applies the law of the forum state. See Panavision Int'l L.P. v. Toeppen, 141 F.3d 1316, 1320 (9th Cir.1998). California's long-arm statute is co-extensive with federal standards, so a federal court may exercise personal jurisdiction if doing so comports with federal constitutional due process. Id. at 1320. "For a court to exercise personal jurisdiction over a nonresident defendant, that defendant must have at least `minimum contacts' with the relevant forum such that the exercise of jurisdiction `does not offend traditional notions of fair play and substantial justice.'" Schwarzenegger, 374 F.3d at 801 (quoting International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945)). There are two forms of personal jurisdiction that a forum state may exercise over a nonresident defendant—general jurisdiction and specific jurisdiction. We deal here only with the latter.²

A. The district court correctly dismissed Boschetto's complaint for lack of personal jurisdiction.

We apply a three-part test to determine whether the exercise of specific jurisdiction over a nonresident defendant is appropriate:

(1) The non-resident defendant must purposefully direct his activities or consummate some transaction with the forum or resident thereof; or perform some act by which he purposefully avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws;

(2) the claim must be one which arises out of or relates to the defendant's forum-related activities; and

(3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e. it must be reasonable.

Id. at 802 (citing Lake v. Lake, 817 F.2d 1416, 1421 (9th Cir.1987)). The plaintiff bears the burden on the first two prongs. Id. If the plaintiff establishes both prongs one and two, the defendant must come forward with a "compelling case" that the exercise of jurisdiction would not be reasonable. Id. (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476-78, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985)). But if the plaintiff fails at the first step, the jurisdictional inquiry ends and the case must be dismissed. See Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1155 (9th Cir. 2006) ("[Plaintiff's] arguments fail under the first prong. Accordingly, we need not address [the remaining two prongs].").

For part one of this three-part test, we have typically analyzed cases that sound primarily in contract—as Boschetto's case does—under a "purposeful availment" standard. Schwarzenegger, 374 F.3d at 802 ("We often use the phrase `purposeful availment' in shorthand fashion, to include both purposeful availment and purposeful direction, but availment and direction are, in fact, two distinct concepts. A purposeful availment analysis is most often used in suits sounding in contract.") (internal citation omitted); see also McGlinchy v. Shell Chemical Co., 845 F.2d 802, 817 (9th Cir.1988) (distinguishing purposeful direction precedents where "personal jurisdiction is sought on a contract claim, not on a tort claim"). To have purposefully availed itself of the privilege of doing business in the forum, a defendant must have "performed some type of affirmative conduct which allows or promotes the transaction of business within the forum state." Sher, 911 F.2d at 1362 (internal quotation marks and citation omitted). Our evaluation of the jurisdictional...