Eox Tech. Sols. v. Galasso
| Docket Number | 23-CV-60448-RAR |
| Decision Date | 22 November 2023 |
| Parties | EOX TECHNOLOGY SOLUTIONS INC., Plaintiff, v. LYDIE BRIGITTE GALASSO, Defendant. |
| Court | U.S. District Court — Southern District of Florida |
ORDER AFFIRMING AND ADOPTING REPORT AND RECOMMENDATION
THIS CAUSE comes before the Court on United States Magistrate Judge Jared M. Strauss's Report and Recommendation, [ECF No. 43] (“Report”), on Defendant's Amended Motion to Dismiss, [ECF No. 26] (“Motion”), Defendant's Motion to Stay and Abstain, [ECF No. 27] (“Motion to Abstain”), and Plaintiff's Motion for Jurisdictional Discovery, [ECF No 34] (“Motion for Discovery”). The Report recommends granting in part and denying in part the Motion denying the Motion to Abstain; and denying the Motion for Discovery as moot. Report at 1. Defendant timely objected to aspects of the Report, [ECF No. 45] (“Objections”), and Plaintiff responded, [ECF No 48] (“Response”). The Court having carefully reviewed the Report, the Objections, and the record, and being otherwise fully advised, it is hereby
ORDERED AND ADJUDGED that the Report is AFFIRMED and ADOPTED as set forth herein.
When a magistrate judge's “disposition” has been properly objected to, district courts must review the disposition de novo. FED. R. CIV. P. 72(B)(3). WHEN NO PARTY HAS TIMELY OBJECTED, HOWEVER, “THE COURT NEED ONLY SATISFY ITSELF THAT THERE IS NO CLEAR ERROR ON THE FACE OF THE RECORD IN order to accept the recommendation.” FED. R. CIV. P. 72 ADVISORY COMMITTEE'S NOTE TO 1983 ADDITION (CITATION OMITTED). ALTHOUGH RULE 72 ITSELF IS SILENT ON THE STANDARD OF REVIEW, THE SUPREME COURT HAS ACKNOWLEDGED CONGRESS'S INTENT WAS TO ONLY REQUIRE A de novo review where objections have been properly filed, not when neither party objects. See Thomas v. Arn, 474 U.S. 140, 150 (1985) . In any event, the “[f]ailure to object to the magistrate [judge]'s factual findings after notice precludes a later attack on these findings.” Lewis v. Smith, 855 F.2d 736, 738 (11th Cir. 1988) (citing Nettles v. Wainwright, 677 F.2d 404, 410 (5th Cir. 1982)).
The Report concludes that Plaintiff has successfully established jurisdiction under one of the categories for specific jurisdiction enumerated by Florida's long-arm statute, specifically section 48.193(1)(a)1 of the Florida Statutes. Report at 7. Defendant contends that Magistrate Judge Strauss failed to properly engage in the burden shifting framework in reaching this conclusion, arguing that Magistrate Judge Strauss overlooked the affidavit Defendant submitted that-she alleges-shows that she does not have minimum contacts with Florida. Objs. at 2-3.
However, the Report did not fail to account for such evidence; rather, Magistrate Judge Strauss properly concluded that Defendant's affidavit was not sufficient to refute the allegations in the Complaint-eliminating the need to consider and weigh Plaintiff's additional evidence. Report at 9-10 (outlining the factual allegations in the Complaint that are not expressly refuted by non-conclusory statements in Defendant's affidavit). Specifically, Defendant maintains the Report did not consider whether Plaintiff's “counter-affidavit” was deficient. Objs. at 3.
Therefore, there is no obligation for the Court to shift the burden back to Plaintiff once the Court has determined that Defendant's evidence is insufficient. Don't Look Media LLC v. Fly Victor Ltd., 999 F.3d 1284, 1292 (11th Cir. 2021) () (emphasis added). And, as explained below, the Court agrees that Defendant's affidavit did not sufficiently refute allegations contained in the Complaint, where Defendant's evidence could not overcome that Plaintiff's fraudulent transfer claims (Counts I-III-allegations that Defendant made the decision to transfer the rental income and sales proceeds from the business for her own pecuniary benefit) are connected to business activities in Florida. Report at 9-10.
While Defendant does not reject that she is subject to specific personal jurisdiction under section 48.193(1)(a)(1)[1], she objects to the Report's consideration of her due process rights, arguing she does not have minimum contacts in Florida. Objs. at 4-5. “Even though a statute may permit a state to assert jurisdiction over a nonresident defendant, the due process clause of the United States Constitution protects an individual's liberty interest in not being subject to the binding judgments of a forum with which he has established no meaningful ‘contacts, ties, or relations.'” Licciardello v. Lovelady, 544 F.3d 1280, 1284 (11th Cir. 2008) (citing International Shoe Co. v. Washington, 326 U.S. 310, 319 (1945)). Specific personal jurisdiction exists if the following three prongs are satisfied: (1) the plaintiff has established that his claims “arise out of or relate to” at least one of the defendant's contacts with the forum; (2) the plaintiff has demonstrated that the defendant “purposefully availed” itself of the privilege of conducting activities within the forum state; and (3) the exercise of jurisdiction would not violate traditional notions of fair play and substantial justice. Louis Vuitton Malletier, S.A. v. Mosseri, 736 F.3d 1339, 1355 (11th Cir. 2013) (citations omitted). “The plaintiff bears the burden of establishing the first two prongs, and if the plaintiff does so, ‘a defendant must make a ‘compelling case' that the exercise of jurisdiction would violate traditional notions of fair play and substantial justice.'” Id. (quoting Diamond Crystal Brands, Inc. v. Food Movers Intern., Inc., 593 F.3d 1249, 1267 (11th Cir. 2010)).
In objecting to the minimum contacts requirement, Defendant focuses entirely on the Report's reference to Kapila v. RJPT, Ltd., 357 So.3d 241, 246 (Fla. 2d DCA 2023), attempting to distinguish the case because it references a choice of law agreement that Defendant did not enter into here.[2] Objs. at 5. However, the Report considered Kapila in its analysis of Florida's long-arm statute generally, not in its assessment of whether the application of the statute violates the Due Process Clause of the Fourteenth Amendment. Report at 8-15. Defendant has not properly objected to the extensive analysis that the Report undertook to find that each prong favored a finding of specific personal jurisdiction. And the Court agrees with the Report that (1) Plaintiff's claims arise out of or relate to at least one of Defendant's contacts with Florida-namely, the allegation that Defendant gained a pecuniary benefit from engaging in leasing activities in Florida and the sale of the property at issue, Compl. ¶ 12; and (2) the Complaint alleges that Defendant deliberately entered into lease agreements with Florida clients on behalf of Flopro, establishing that Defendant purposefully availed herself of the benefit of Florida law. Id.; see also SkyHop Techs., Inc. v. Narra, 58 F.4th 1211, 1230 (11th Cir. 2023) ().
Finally, Defendant has failed to demonstrate that exercising personal jurisdiction would run afoul of “traditional notions of fair play and substantial justice.” Defendant, instead, conflates Plaintiff's burden with that of Defendant. Mot. at 10-13. Thus, this objection is unavailing. PVC Windoors, Inc. v. Babbitbay Beach Const., N.V., 598 F.3d 802, 810 (11th Cir. 2010) () (internal citations omitted) (alteration in original); Internet Sols. Corp. v. Marshall, 557 F.3d 1293, 1295 (11th Cir. 2009) ().
Defendant advances a singular argument in support of dismissing the fraudulent transfer claims-that Federal Rule of Civil Procedure 9(b) applies and Plaintiff has failed to meet this heightened pleading standard. Mot. at 13-14; Reply to Plaintiff's Response to Defendant's Amended Motion to Dismiss, [ECF No. 40] at 5-7. But as the Report correctly notes, Defendant has failed to bear her burden of showing that the Complaint should be dismissed, notwithstanding which pleading standard should apply. Madinya v. Portfolio Recovery Assocs., LLC, No. 1861138, 2018 WL 4510151, at *5 (S.D. Fla. Sept. 20, 2018) ( ) (quoting Sprint Sols., Inc. v. Fils-Amie, 44 F.Supp.3d 1224, 1228 (S.D. Fla. 2014)). The Court agrees with the Report's conclusion that Plaintiff has successfully pleaded both actual and constructive fraudulent transfer claims, even under a heightened pleading standard for the claims alleged under section 726.105(1)(a) of the...
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