Cunningham v. CBC Conglomerate, LLC

• Decision Date: 05 February 2019
• Docket Number: Civil Action No. 4:17-CV-793
• Citation: 359 F.Supp.3d 471
• Parties: Craig CUNNINGHAM v. CBC CONGLOMERATE, LLC, et al.
• Court: U.S. District Court — Eastern District of Texas

359 F.Supp.3d 471

Craig CUNNINGHAM

v.CBC CONGLOMERATE, LLC, et al.

Civil Action No. 4:17-CV-793

United States District Court, E.D. Texas, Sherman Division.

Signed February 5, 2019

MEMORANDUM ADOPTING REPORT AND RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE

AMOS L. MAZZANT, UNITED STATES DISTRICT JUDGE

Came on for consideration the report of the United States Magistrate Judge in this action, this matter having been heretofore referred to the Magistrate Judge pursuant to 28 U.S.C. § 636. On January 4, 2019, the report of the Magistrate Judge (Dkt. # 79) was entered containing proposed findings of fact and recommendations that Defendants Bruce Phillip Hood, Carey George Howe, and Jay Singh's Motion to Dismiss for Lack of Personal Jurisdiction (Dkt. # 53) be granted, and Defendants Bruce Phillip Hood, Carey George Howe, and Jay Singh be dismissed from the lawsuit.

Having received the report of the Magistrate Judge, and no objections thereto having been timely filed, the Court is of the opinion that the findings and conclusions of the Magistrate Judge are correct and adopts the Magistrate Judge's report as the findings and conclusions of the Court.

It is, therefore, ORDERED that Defendants Bruce Phillip Hood, Carey George Howe, and Jay Singh's Motion to Dismiss for Lack of Personal Jurisdiction (Dkt. # 53) be GRANTED. Specifically, Defendants Bruce Phillip Hood, Carey George Howe, and Jay Singh are DISMISSED without prejudice.

IT IS SO ORDERED.

REPORT AND RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE

Christine A. Nowak, UNITED STATES MAGISTRATE JUDGEPending before the Court is Defendants Bruce Phillip Hood, Carey George Howe, and Jay Singh's (collectively, the "Individual Defendants") "Motion to Dismiss for Lack of Personal Jurisdiction" [Dkt. 53]. After reviewing the Motion to Dismiss [Dkt. 53], Plaintiff's Response [Dkt. 61], and all other relevant filings, the Court recommends that the Individual Defendants' Motion to Dismiss be GRANTED .

BACKGROUND

Plaintiff Craig Cunningham ("Plaintiff"), proceeding pro se , filed his original Complaint on November 9, 2017 asserting causes of action against the Individual Defendants for violations of the Telephone Consumer Protection Act ("TCPA"), Fair Debt Collection Practice Act ("FDCPA"), and invasion of privacy [Dkt. 1]. On January 26, 2018, the Individual Defendants filed their first "Motion to Dismiss for Lack of Personal Jurisdiction" [Dkt. 17] ("First Motion to Dismiss"). The undersigned entered a report and recommendation, recommending that the First Motion to Dismiss be denied to allow Plaintiff leave to amend his Complaint; the report further noted that Plaintiff's original Complaint "[did] not establish that each of the Individual Defendants [were] subject to the Court's exercise of personal jurisdiction; pro se Plaintiff ha[d] failed to allege sufficient factual support for his contention that the Individual Defendants are subject to suit in Texas" [Dkts. 41 at 16]. The District Court adopted the report and recommendation, denying the First Motion to Dismiss and permitting Plaintiff to amend his complaint [Dkt. 43]. On September 17, 2018, Plaintiff filed his Amended Complaint, the live pleading [Dkt. 48].¹ The Individual Defendants subsequently filed the instant "Motion to Dismiss for Lack of Personal Jurisdiction" on October 1, 2018 ("Second Motion to Dismiss") [Dkt. 53]. The Court notes that the First Motion to Dismiss and the Second Motion to Dismiss are nearly identical save for section four of the Second Motion to Dismiss where the Individual Defendants address allegations made specifically in Plaintiff's Amended Complaint [compare Dkts. 17 and 53]. Plaintiff filed his Response in opposition to the Second Motion to Dismiss on October 29, 2018 [Dkt. 61].

The Amended Complaint

Plaintiff alleges in his Amended Complaint that CBC Conglomerate LLC ("CBC"), USFFC Inc. ("USFFC"), and the Individual Defendants "are liable for the calls placed on their behalf and for their benefit to the Plaintiff's cell phone 615-212-9191 offering unsolicited student loan consolidation services" [Dkt. 48 at 4]. Plaintiff asserts that CBC and USFFC are corporations operating in California and that the Individual Defendants, officers of CBC and USFFC, are residents of California [Dkt. 48 at 1-2]. Concerning the jurisdictional concerns of this action, Plaintiff avers that the:

Jurisdiction of this court arises as the defendants continuous and systematic contacts within the state of Texas in placing numerous phone calls to consumers in the state of Texas as part of a robocall marketing campaign in which numerous phone calls were made to consumers across the country. Subject matter jurisdiction is apparent as the TCPA is a federal question under 28 U.S.C. [§] 1331.

Venue in this District is proper as the defendants are subject to personal jurisdiction based on the continuous and systematic contacts within the forum state of Texas. The telephone calls which led to the violations of [sic] alleged here occurred in Texas. The Defendants made multiple unsolicited telephone calls to the Plaintiff and other Texas residents.

[Dkt. 48 at 2].

Different from Plaintiff's original Complaint, Plaintiff's Amended Complaint alleges specific "actions" taken by each of the Individual Defendants [Dkt. 48 at 8-12]. Plaintiff contends that, prior to the phone calls made at issue in this case, the Individual Defendants were aware that Plaintiff's phone number was 615-212-9191 and that "Plaintiff did not want to receive telemarketing calls relating to student loan consolidation as a result of [a 2015 Tennessee lawsuit to which Plaintiff and the Individual Defendants were parties]" [Dkt. 48 at 8-11].

As to each of the Individual Defendants specifically, Plaintiff asserts that Bruce Hood and Carey George Howe had control over CBC's operations and that they "directed Jay Singh to place automated calls with pre-recorded messages for [their] own profit and benefit" [Dkt. 48 at 9, 12]. Plaintiff does not allege that Bruce Hood or Carey George Howe personally made any phone calls. Plaintiff avers that Jay Singh controls and operates USFFC and that he "directed and knew that his corporation in name only USFC was placing illegal telemarketing calls to consumers" [Dkt. 48 at 9].

It is unclear whether Plaintiff asserts that Jay Singh personally placed any of the phone calls at issue in this case. Without specifically discussing the 73 phone calls Plaintiff alleges were made in violation of the TCPA, Plaintiff alleges that "Jay Singh continued to place illegal telemarketing calls for Bruce Hood and accept payment for the illegal telemarke[t]ing calls in 2017 and 2018 after getting sued by Plaintiff" [Dkt. 48 at 10]. Plaintiff then goes on to clarify that "Jay Singh directed employees he could fire, discipline, or control to place automated calls with pre-recorded messages for his own profit and benefit" [Dkt. 48 at 10]. Thus, Plaintiff's allegations demonstrate that Jay Singh directed the placement of phone calls within the corporate structure, and not that he personally dialed the offending phone calls.

LEGAL STANDARD

12(b)(2) Motion to Dismiss

Federal Rule of Civil Procedure 12(b)(2) requires a court to dismiss a claim if the court does not have personal jurisdiction over the defendant. "After a non-resident defendant files a motion to dismiss for lack of personal jurisdiction, it is the plaintiff's burden to establish that in personam jurisdiction exists." Lahman v. Nationwide Provider Sols. , No. 4:17-CV-00305, 2018 WL 3035916, at *4 (E.D. Tex. June 19, 2018) (Mazzant, J.) (citing Bullion v. Gillespie , 895 F.2d 213, 217 (5th Cir. 1990) (citing WNS, Inc. v. Farrow , 884 F.2d 200, 202 (5th Cir. 1989) ). "To satisfy that burden, the party seeking to invoke the court's jurisdiction must ‘present sufficient facts as to make out only a prima facie case supporting jurisdiction,’ if a court rules on a motion without an evidentiary hearing." Id. (quoting Alpine View Co. v. Atlas Copco AB , 205 F.3d 208, 215 (5th Cir. 2000) ). "When considering the motion to dismiss, ‘[a]llegations in [a] plaintiff's complaint are taken as true except to the extent that they are contradicted by defendant's affidavits.’ " Id. (quoting Int'l Truck & Engine Corp. v. Quintana , 259 F.Supp.2d 553, 557 (N.D. Tex. 2003)(citing Wyatt v. Kaplan , 686 F.2d 276, 282–83 n.13 (5th Cir. 1982) ); accord Black v. Acme Mkts., Inc. , 564 F.2d 681, 683 n.3 (5th Cir. 1977). "Further, ‘[a]ny genuine, material conflicts between the facts established by the parties' affidavits and other evidence are resolved in favor of plaintiff for the purposes of determining whether a prima facie case exists.’ " Id. (quoting Quintana , 259 F.Supp.2d at 557 (citing Jones v. Petty-Ray Geophysical Geosource, Inc. , 954 F.2d 1061, 1067 (5th Cir. 1992) ).

A court conducts a two-step inquiry when a defendant challenges personal jurisdiction: (1) "[f]irst, absent a controlling federal statute regarding service of process, the court must determine whether the forum state's long-arm statute confers personal jurisdiction over the defendant;" and (2) "second, the court establishes whether the exercise of jurisdiction is consistent with due process under the United States Constitution." Id. (citing Ham v. La Cienega Music Co. , 4 F.3d 413, 415 (5th Cir. 1993) ). "The Texas long-arm statute confers jurisdiction to the limits of due process under the Constitution;" accordingly, "the sole inquiry that remains is whether personal jurisdiction offends or comports with federal constitutional guarantees." Id. (citing Command-Aire Corp. v. Ont. Mech. Sales and Serv. Inc. , 963 F.2d 90, 93 (5th Cir. 1992) ; Bullion , 895 F.2d at 216 ). "The Due Process Clause permits the exercise of personal jurisdiction over a non-resident defendant when the defendant has established minimum contacts with the forum state ‘such that maintenance of the suit does not offend traditional notions of fair play and substantial...