EState Ainsworth v. Boutwell

• Decision Date: 04 March 2011
• Docket Number: Civil Action No. 2:10–CV–288–KS–MTP.
• Citation: 776 F.Supp.2d 227
• Parties: ESTATE OF J.C. AINSWORTH, Jr., by Patricia Ainsworth, Administratrix, Plaintiffsv.Gary N. BOUTWELL, II; Anderson & Boutwell, Ltd., Defendants.
• Court: U.S. District Court — Southern District of Mississippi

776 F.Supp.2d 227

ESTATE OF J.C. AINSWORTH, Jr., by Patricia Ainsworth, Administratrix, Plaintiffs

v.Gary N. BOUTWELL, II; Anderson & Boutwell, Ltd., Defendants.

Civil Action No. 2:10–CV–288–KS–MTP.

United States District Court, S.D. Mississippi, Hattiesburg Division.

March 4, 2011.

W. Brady Kellems, Brookhaven, MS, for Plaintiffs.Clifford B. Ammons, Watkins & Eager, Jackson, MS, for Defendants.

Memorandum Opinion and Order

KEITH STARRETT, District Judge.

The Court now addresses Defendants' Motion to Dismiss for Lack of Personal Jurisdiction [7]. For the reasons stated below, the Court grants the motion. Accordingly, this case is dismissed without prejudice.

I. Background

Christopher Shows, a Louisiana resident, was involved in a motor vehicle accident in Hammond, Louisiana, on or about August 5, 2005. He contacted a family friend—J.C. “Jack” Ainsworth, Jr.—to retain his representation with regard to legal claims arising from the accident. Ainsworth advised Shows that he needed to retain a Louisiana law firm to assist in the litigation, as Ainsworth was not licensed to practice in Louisiana. Accordingly, Ainsworth contacted Defendant Gary N. Boutwell, and they entered into a fee-splitting arrangement in which Defendants would represent Shows in his Louisiana litigation in exchange for two-thirds of his fees and costs, while Ainsworth received one-third of the fees and costs.

Defendants pursued multiple legal actions on Shows' behalf. The first action—against State Farm Mutual Automobile Insurance Company—settled for $25,000.00. On December 1, 2006, Defendants tendered a check in the amount of $3,333.33 to Ainsworth for his share of the fees.

Ainsworth died on January 3, 2008, and Defendants continued to pursue claims on behalf of Shows in the state of Louisiana. In November 2010, Shows settled his remaining claims for $350,000.00. Ainsworth's Estate filed its Complaint [1] on December 3, 2010, claiming that it is due one-third of the fees recovered from Shows' November 2010 settlement. On January 25, 2011, Defendants filed their Motion to Dismiss for Lack of Personal Jurisdiction [7], which the Court now addresses.

II. Discussion

A. Rule 12(b)(6) Standard

“When a nonresident defendant presents a motion to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of establishing the district court's jurisdiction over the nonresident. The court may determine the jurisdictional issue by receiving affidavits, interrogatories, depositions, oral testimony, or any combination of the recognized methods of discovery.” Allred v. Moore & Peterson, 117 F.3d 278, 281 (5th Cir.1997) (quoting Stuart v. Spademan, 772 F.2d 1185, 1192 (5th Cir.1985)). However, where the Court “rules on a motion to dismiss for lack of personal jurisdiction without an evidentiary hearing, the plaintiff need only make a prima facie case that jurisdiction is proper.” Paz v. Brush Engineered Materials, Inc., 445 F.3d 809, 812 (5th Cir.2006) (citing Quick Techs., Inc. v. Sage Group PLC, 313 F.3d 338, 343 (5th Cir.2002)). While the Court is not limited to consideration of only the allegations in the plaintiff's complaint, it must accept the “uncontroverted allegations” contained therein as true. Id. (citing Bullion v. Gillespie, 895 F.2d 213, 217 (5th Cir.1990)).

A “federal court sitting in diversity may assert jurisdiction if: (1) the state's long-arm statute applies, as interpreted by the state's courts; and (2) if due process is satisfied under the fourteenth amendment to the United States Constitution.” Allred, 117 F.3d at 281 (quoting Cycles, Ltd. v. W.J. Digby, Inc., 889 F.2d 612, 616 (5th Cir.1989)). As the due process prong of the analysis is determinative in this case, the Court shall not address Mississippi's long-arm statute.

B. Due Process

“Exercising personal jurisdiction over a nonresident defendant is consistent with due process when (1) defendant has purposefully availed himself of the benefits and protections of the forum state by establishing minimum contacts with the forum state, and (2) the exercise of jurisdiction does not offend traditional notions of fairplay and substantial justice.” Paz, 445 F.3d at 813 (quoting Panda Brandywine Corp. v. Potomac Elec. Power Co., 253 F.3d 865, 867 (5th Cir.2001)); see also Clemens v. McNamee, 615 F.3d 374, 378 (5th Cir.2010) (citing Revell v. Lidov, 317 F.3d 467, 470 (5th Cir.2002)).

“There are two types of minimum contacts: contacts that give rise to specific personal jurisdiction and those that give rise to general jurisdiction.” Clemens, 615 F.3d at 378 (citing Wilson v. Belin, 20 F.3d 644, 647 (5th Cir.1994)). General personal jurisdiction exists where “a defendant has continuous and systematic general business contacts with the forum state.” McFadin v. Gerber, 587 F.3d 753, 759 (5th Cir.2009). There is no evidence in the record to suggest that Defendants have “continuous and systematic general business contacts” in Mississippi, and Plaintiff does not argue such. Rather, Plaintiff argues that Defendants' specific actions relating to the present case are sufficient to justify the Court's exercise of specific personal jurisdiction over them.

Generally, “[s]pecific personal jurisdiction exists when ‘the defendant has purposefully directed his activities at residents of the forum ... and the litigation results from alleged injuries that arise out of or relate to those activities.’ ” Clemens, 615 F.3d at 378 (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985); Jones v. Petty–Ray Geophysical Geosource, Inc., 954 F.2d 1061, 1068 n. 9 (5th Cir.1992)). The Fifth Circuit Court of Appeals has articulated a three pronged analysis for determining whether the Court has specific personal jurisdiction over a defendant:

(1) whether the defendant has minimum contacts with the forum state, i.e., whether it purposely directed its activities toward the forum state or purposefully availed itself of the privileges of conducting activities there; (2) whether the plaintiff's cause of action arises out of or results from the defendant's forum-related contacts; and (3) whether the exercise of personal jurisdiction is fair and reasonable.

McFadin, 587 F.3d at 759 (citing Seiferth v. Helicopteros Atuneros, Inc., 472 F.3d 266, 271 (5th Cir.2006)). “If the plaintiff successfully satisfies the first two prongs, the burden shifts to the defendant to defeat jurisdiction by showing that its exercise would be unfair or unreasonable.” Seiferth, 472 F.3d at 271 (citing Nuovo Pignone v. STORMAN ASIA M/V, 310 F.3d 374, 382 (5th Cir.2002)).

“The ‘minimum contacts' inquiry is fact intensive and no one element is decisive; rather the touchstone is whether the defendant's conduct is such that it ‘reasonably anticipates being haled into court.’ ” McFadin, 587 F.3d at 759 (quoting Luv N' Care, Ltd. v. Insta–Mix, Inc., 438 F.3d 465, 470 (5th Cir.2006)); see also Clemens, 615 F.3d at 378. To support a finding of specific personal jurisdiction, it is “essential that there be some act by which the defendant purposefully avails himself of the privilege of conducting activities with the forum state, thus invoking the benefits and protections of its laws.” Clemens, 615 F.3d at 379 (citing Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 2 L.Ed.2d 1283 (1958)). “[R]andom, fortuitous, or attenuated contacts” are not sufficient. Id. (citing Burger King Corp., 471 U.S. at 472, 105 S.Ct. 2174). Further, “[t]he defendant ‘must not be haled into a jurisdiction solely as a result of ... the ‘unilateral activity of another party or third persons.’ ” McFadin, 587 F.3d at 759.

Plaintiff argues that Defendants intentionally pursued business activity in the state of Mississippi by entering into a fee-splitting arrangement with Ainsworth. Plaintiff asserts that Defendants communicated with Ainsworth through telephone, e-mail, and traditional mail. Defendants do not deny that they entered into a fee-splitting agreement with Ainsworth ¹ or that they communicated with him regarding that agreement. Rather, they argue that their actions do not constitute sufficient contacts with Mississippi to justify the Court's exercise of personal jurisdiction over them. The Court agrees with Defendants.

Defendants do not practice law or otherwise do business in Mississippi. Indeed, they are not licensed to practice law in Mississippi. They do not own property in Mississippi or maintain an office here. The record shows that Ainsworth solicited their involvement in Shows' case, rather than Defendants soliciting Shows' business or Ainsworth's partnership in Shows' litigation. Further, it is undisputed that all of Shows' claims were prosecuted in Louisiana courts. No discovery was conducted in Mississippi, and no pleadings were filed here. Therefore, the evidence currently in the record shows that Defendants performed their side of the contract—representing Shows—in Louisiana alone.

The only connection Defendants have with the state of Mississippi is that they entered into a contract with a resident of this state and communicated with him regarding the terms and performance of that contract. Plaintiff argues that this is sufficient to justify the exercise of personal jurisdiction. However, the Fifth Circuit Court of Appeals has explicitly held that “merely contracting with a resident of the forum state does not establish minimum contacts.” Id. at 760 (citing Moncrief Oil Int'l v. OAO Gazprom, 481 F.3d 309, 311 (5th Cir.2007); Burger King Corp., 471 U.S. at 478, 105 S.Ct. 2174). Furthermore, “communications relating to the performance of a contract themselves are insufficient to establish minimum contacts.” Id. (citing Freudensprung v. Offshore Technical Servs., Inc., 379 F.3d 327, 344 (5th Cir.2004)).

The Fifth Circuit has addressed a case with facts similar to those of the present case. In McFadin, a Texas handbag manufacturer brought tort and contract claims against a sales representative...