Canale v. Rubin

• Decision Date: 04 November 2009
• Docket Number: No. 2D08-1535.,2D08-1535.
• Citation: 20 So.3d 463
• Parties: James A. CANALE and Jacana Holdings Group, LLC, Appellants, v. Jeffrey L. RUBIN, Real Estate Riches, Inc., a Florida corporation, and Real Estate Riches, Inc., a Pennsylvania corporation, Appellees.
• Court: Florida District Court of Appeals

20 So.3d 463

James A. CANALE and Jacana Holdings Group, LLC, Appellants, v. Jeffrey L. RUBIN, Real Estate Riches, Inc., a Florida corporation, and Real Estate Riches, Inc., a Pennsylvania corporation, Appellees.

No. 2D08-1535.

District Court of Appeal of Florida, Second District.

November 4, 2009.

Jason Lessinger of Icard, Merrill, Cullis, Timm, Furen & Ginsburg, P.A., Sarasota, for Appellants.

Stanley A. Goldsmith, Sarasota, for Appellees.

NORTHCUTT, Judge.

James A. Canale and Jacana Holdings Group, LLC, have appealed the order denying their motion to dismiss the complaint against them for lack of personal jurisdiction. See Fla. R.App. 9.130(a)(3)(C)(i). We reverse and remand for further proceedings.

Jeffrey Rubin and the two corporations, both named Real Estate Riches, (hereinafter referred to, where appropriate, as either "RER," "RER-PA," or "RER-FL") filed suit against Canale and Jacana in the Sarasota circuit court. Rubin, a Florida resident, is a principal in both RER companies. Canale is a resident of Pennsylvania. Jacana, a now-defunct Wyoming limited liability company, had its principal place of business in Pennsylvania.

The amended verified complaint alleged numerous causes of action, both in contract and in tort, including breach of a confidentiality agreement, breach of an independent contractor agreement, misappropriation of trade secrets, and defamation. It also alleged that Canale and Jacana had subjected themselves to Florida long-arm jurisdiction by: (1) carrying on a business in Florida, (2) committing torts in Florida, (3) breaching a contract in Florida, and (4) engaging in substantial and not isolated activity in Florida. See § 48.193(1)(a), (1)(b), (1)(g), (2), Fla. Stat. (2007).

Canale and Jacana moved to dismiss for lack of personal jurisdiction. Their motion was accompanied by an affidavit that disputed the allegations of the complaint. The circuit court held a hearing on the motion, but it did not take evidence. In its order denying the motion, the court found that it had jurisdiction over the defendants on three bases: that they carried on a business in Florida; that they committed torts in Florida; and that they engaged in substantial, not isolated, activity in Florida.

Our review of a circuit court's decision on a motion to dismiss for lack of personal jurisdiction is de novo. See Wendt v. Horowitz, 822 So.2d 1252, 1256 (Fla.2002); Execu-Tech Bus. Sys., Inc. v. New Oji Paper Co. Ltd., 752 So.2d 582, 584 (Fla.2000). A Florida court conducts a two-step inquiry when determining whether jurisdiction under Florida's long-arm statute is proper in a given case. Initially, it must determine whether the complaint alleges jurisdictional facts sufficient to invoke the statute. If so, the court must then examine whether the defendant has sufficient "minimum contacts" with Florida in order to satisfy due process requirements. Execu-Tech, 752 So.2d at 584.

The Florida long-arm statute provides for two types of personal jurisdiction: general, § 48.193(2), and specific, § 48.193(1). General jurisdiction arises when the defendant engages in substantial and not isolated activities in Florida. Thus, for example, a corporation with many facilities or activities in Florida has purposefully directed its activities at this state and therefore is subject to suit here on any claim. Christus St. Joseph's Health Sys. v. Witt Biomedical Corp., 805 So.2d 1050, 1052 (Fla. 5th DCA 2002). General jurisdiction arises from a party's contacts with Florida that are unrelated to the litigation. See Madara v. Hall, 916 F.2d 1510, 1516 n. 7 (11th Cir.1990). Specific jurisdiction, on the other hand, requires a causal connection between the defendant's activities in Florida and the plaintiff's cause of action, a requirement known as "connexity." Wendt, 822 So.2d at 1260.

General jurisdiction: § 48.193(2)

As a preliminary matter, we note that the plaintiffs' allegation of general jurisdiction seems superfluous in this case. General jurisdiction requires far more wide-ranging contacts with the forum state than specific jurisdiction, and it is thus more difficult to establish. As mentioned, a plaintiff must establish that there is general jurisdiction over a defendant only when the defendant's contacts with the forum state are unrelated to the plaintiff's cause of action. See, e.g., Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984) (reciting the following facts when noting that the plaintiffs had to show that general jurisdiction existed: Texas residents were killed in a helicopter accident in Peru while working for a Peruvian consortium; plaintiffs, the decedents' representatives, sought to maintain a wrongful death suit in Texas against the Colombian corporation that provided the helicopters to the Peruvian company; helicopter company's contacts with forum state were merely commercial and not related to the accident that was the subject of the lawsuit).

All of the causes of action alleged in this case stemmed from the business dealings between the parties. These dealings also were the very contacts with Florida that the plaintiffs argued as the bases for this state's personal jurisdiction over the defendants. Thus, the defendants' alleged contacts were related to the plaintiffs' causes of action and, if true, would subject the defendants to specific jurisdiction. But, whether the plaintiffs needed to or not, they claimed that Canale and Jacana were subject to this state's general jurisdiction, and the circuit court agreed. Consequently, we must address this ruling.

The order determining that there was general personal jurisdiction over Canale and Jacana did not recite facts to support that conclusion. Because we conduct a de novo review of such orders, we turn to the allegations of the complaint and the affidavit filed in support of the motion to dismiss. The complaint tracked the language of the statute and alleged: "Defendants Canale and Jacana are subject to personal jurisdiction in Florida for having engaged in substantial and not isolated activity within the State pursuant to F.S. 48.193(2)." This bare assertion was sufficient to meet the plaintiffs' initial burden of pleading jurisdiction. See Venetian Salami Co. v. Parthenais, 554 So.2d 499, 502 (Fla.1989); Hilltopper Holding Corp. v. Estate of Cutchin ex rel. Engle, 955 So.2d 598, 601 (Fla. 2d DCA 2007). The burden then shifted to the defendants to submit a legally sufficient affidavit or other sworn proof to contest the plaintiffs' jurisdictional allegation. Venetian Salami, 554 So.2d at 502; Hilltopper Holding, 955 So.2d at 598.

Canale filed an affidavit on his own behalf and on behalf of Jacana contesting the allegation that they engaged in substantial activity in Florida. The affidavit averred that:

13. Jacana has no office in Florida, owns no interest in real property in Florida, does not conduct business in Sarasota County or any other County in Florida, and is not registered to do business in Florida.

14. Jacana does not have employees, officers, agents or other representatives located or working in Florida, does not regularly sell or ship goods into Florida, and does not advertise or solicit business in Florida.

15. Jacana does not engage in substantial activity within the State of Florida.

16. I do not reside in Florida, have no office in Florida, own no interest in real property in Florida and do not conduct business in Sarasota County or any other County in Florida.

17. I do not engage in substantial activity within the State of Florida.

In addition, Canale recounted that he had visited Florida only once, for a social celebration with Rubin and other business associates. Rubin and the RER corporations did not file affidavits contesting Canale's allegations. The verified amended complaint did not identify any substantial activities of Canale or Jacana in Florida, or any activities unrelated to the pending litigation.

If a defendant's affidavit fully disputes the plaintiff's allegation, which in this case was a mere boilerplate recitation of the statute, the burden then shifts back to the plaintiff to prove by affidavit or other sworn proof that there is a basis for long-arm jurisdiction. Hilltopper Holding, 955 So.2d at 602. As noted, Rubin and the RER entities did not do so. As such, they failed to meet their burden of showing that Canale and Jacana fell within the ambit of the Florida long-arm statute. See Execu-Tech, 752 So.2d at 584.

Vis-à-vis their assertion of general personal jurisdiction, the plaintiffs also failed to meet the second requirement of the Execu-Tech test, i.e., that the defendants had the requisite "minimum contacts" with Florida. This can be seen when the limited activities alleged in the plaintiffs' complaint are compared to the facts of Helicopteros Nacionales, 466 U.S. at 416-419, 104 S.Ct. 1868. In that case the United States Supreme Court found no continuous and systematic business contacts sufficient to support general jurisdiction over a foreign corporation in Texas notwithstanding that the corporation had sent its chief executive officer to Texas to negotiate a contract; accepted checks drawn on a Texas bank; purchased products, equipment, and training services; and sent its employees to Texas for training. Canale's and Jacana's contacts with Florida, as alleged in the complaint, were not nearly as extensive or systematic as those described in Helicopteros. See also Rafal v. Mesick, 661 So.2d 79, 81-82 (Fla. 2d DCA 1995) (discussing what activities in the state might support general jurisdiction).

For these reasons, the circuit court's holding that the defendants were subject to its general personal jurisdiction under the long-arm statute was incorrect.

Specific Jurisdiction

A. Conducting a Business in Florida, § 48.193(1)(a)

The plaintiffs' complaint asserted that Canale and Jacana breached two contracts—an initial confidentiality agreement...