Estate of Carvel ex rel. Carvel v. Ross

• Decision Date: 17 July 2008
• Docket Number: Civ. Action No. 07-238-JJF.
• Parties: Agnes CARVEL ESTATE, London, England by Pamela CARVEL, Delaware ancillary administrator, and Pamela Carvel, Fiduciary-Creditor on behalf of herself and others similarly situated, Plaintiffs, v. Leonard ROSS, John/Jane Doe 1 through 20, and Doe Corp. 1 through 20, Defendants.
• Court: U.S. District Court — District of Delaware

566 F.Supp.2d 342

Agnes CARVEL ESTATE, London, England by Pamela CARVEL, Delaware ancillary administrator, and Pamela Carvel, Fiduciary-Creditor on behalf of herself and others similarly situated, Plaintiffs, v. Leonard ROSS, John/Jane Doe 1 through 20, and Doe Corp. 1 through 20, Defendants.

Civ. Action No. 07-238-JJF.

United States District Court, D. Delaware.

July 17, 2008.

COPYRIGHT MATERIAL OMITTED

Agnes Carvel Estate, London, England by Pamela Carvel, and Pamela Carvel, London, England, Pro se Plaintiffs.

Sean M. Brennecke and David J. Margules, Esquires, Bouchard, Margules & Friedlander, Wilmington, DE, Attorneys for Defendant Leonard Ross.

MEMORANDUM OPINION

FARNAN, District Judge.

Presently before the Court is Defendant Leonard Ross' Motion To Dismiss and supporting Memorandum and Plaintiffs' Opposition thereto. (D.I. 10.) Also before the Court is Plaintiffs' Motion To Stay Pending Discovery and Praecipe. (D.I. 13, 16.) For the reasons discussed, the Court will grant the Motion To Dismiss and will deny the Motion To Stay Pending Discovery, and decline to issue a subpoena duces tecum.

I. BACKGROUND

Pamela Carvel ("Pamela"), filed this Complaint, followed by an Amended Complaint, on behalf of the Agnes Carvel ("Agnes") Estate, London, England ("Estate") as the Delaware ancillary administrator for the Estate and Agnes' personal representative through May 2, 2007, and on her own behalf, and others similarly situated, as fiduciary-creditor (collectively "Plaintiffs") against Defendant Leonard Ross ("Defendant"), as attorney, proxy, and fiduciary to Agnes since 1991, John/ Jane Does, and Doe Corps.¹ (D.I. 1, 3.) Plaintiffs proceed pro se. Plaintiffs assert jurisdiction pursuant to 28 U.S.C. § 1331 and allege causes of actions under 18 U.S.C. §§ 241, 242, 245, 1111, 1117, 1341, 1343, 1664, 1952, 1961 through 1968, 1961(4), 1962, 1964(a), 1964(c), 2314, and 2315; 28 U.S.C. §§ 455 and 1343; and 42 U.S.C. §§ 1981, 1982, 1983, 1985, and 1988 for violations of the First, Fifth, Ninth, and Fourteenth Amendments. Plaintiffs also assert supplemental state claims pursuant to 28 U.S.C. § 1367 for fraud and conspiracy to commit fraud. The Amended Complaint describes the "Nature of Action" as "fraudulent conversion of Carvel assets, to compel [Defendants] to return stolen assets, to disgorge themselves of their ill-gotten gains, and for damages Defendants caused." (D.I. 3, ¶ 2.) Defendant Ross moves for dismissal for lack of personal jurisdiction pursuant to Fed.R.Civ.P. 12(b)(2).

The facts alleged by Plaintiffs in the Amended Complaint relevant to Defendant's Motion To Dismiss are as follows.² Defendant Ross is a lawyer licensed in New York, with a mailing address in New York. (D.I. 3, ¶ 19.) Beginning in 1991, Defendant represented Agnes and the Estate in matters concerning Delaware corporations, Delaware assets, and Delaware claims. (Id. at ¶ 4, 31.) Defendant is the New York ancillary administrator of the Estate of Agnes Carvel. (Id. at ¶ 40.) Also, Defendant was Agnes' attorney in Foundation matters for almost seven years. (Id. at ¶ 31.)

Plaintiffs also allege Defendant refused to take action in New York to enforce the intentions of Agnes. (Id. at ¶ 31.) Defendant acted to wipe out Plaintiffs' Delaware claims and harmed Plaintiffs by failing and refusing to assert Delaware claims in New York, and by actively and aggressively obstructing Pamela's ability to assert claims in New York. (Id. at ¶ 4.) Defendant knowingly and intentionally committed acts and omissions over Delaware assets and effecting Delaware claim issues, in collusion with co-conspirators in Delaware and elsewhere. (Id. at ¶ 19.) Defendants knew their harmful acts in Delaware and outside Delaware would damage Plaintiffs' claims and assets in Delaware. (Id. at ¶ 19.)

Further, Plaintiffs allege an apparent criminal enterprise, bribery, and political corruption in New York denied Plaintiffs the right to redress grievances in New York, denied jurisdiction over non-New York debts, and denied them protection under New York law of foreign fiduciary or Delaware ancillary administration interests in estate assets. (Id. at ¶ 15.) Apparent frauds by Defendants elsewhere were intended to prevent the recovery of the value of the Agnes' Delaware corporate interests. (Id. at ¶ 16.)

Plaintiffs also contend the claim in Delaware to stock ownership in Carvel Corp., a Delaware corporation, is part of the claim to ownership of Andreas Holdings Corp. ("Andreas"), also a Delaware corporation. (Id. at ¶ 46.) Andreas purports to be a merger of former Carvel Corp. wholly owned subsidiaries retained by the Carvels. (Id.) In 1995, Agnes and Pamela, as directors, filed a lawsuit in Delaware Chancery Court proceeding to establish ownership of Andreas. (Id. at 46, 47.) Defendant failed to do anything about a perjured affidavit filed by attorney Lawrence Fay in the 1995 Andreas court proceeding. (Id. at ¶ 47.) Also, Defendant was negligent in New York when he failed to correctly value Andreas. (Id.) With regard to the sale of stock from Carvel Corp., a Delaware corporation, Defendant assisted Agnes in several investigations to discover the whereabouts of diverted funds, but once he became the New York ancillary administrator he colluded with others to divert the funds and wipe away Agnes' claims. (Id. at ¶ 51.)

Counts 1 through 3 of the Amended Complaint allege fraud and conspiracy to commit fraud in contradiction and in violation of Delaware, Florida, and New York laws. (Id. at ¶ 82.) Count 4 alleges abuse of process. Counts 5 through 20 allege conspiracy to interfere with rights. Counts 21 through 26 allege RICO violations, and specifically that Defendants were knowledgeable that their fraudulent transfer of Carvel assets was a tortious act under Delaware, Florida, and New York state laws. (Id. at ¶ 100.)

Plaintiffs seek discovery to identify, quantify, and assert damages by Defendant and others yet to be identified; disaffirmance pursuant to New York law of all individual and professional acts taken by Defendants; discovery to determine the extent of Defendants' criminal acts and those with whom they conspired; statutory disqualification of the acts of the Westchester County New York Surrogate Anthony Scarpino³ in all Carvel estate matters; damages as of 1990 in excess of $300 million; and taxes, penalties, and statutory interest on original damages, and treble damages pursuant to RICO statutes.

II. MOTION TO DISMISS

Defendant Ross moves for dismissal pursuant to Fed.R.Civ.P. 12(b)(2) for lack of personal jurisdiction. Defendant Ross argues that he is a citizen of the State of New York, has no contacts with the State of Delaware, and that the allegations in the Amended Complaint neither satisfy the requisites of the Delaware long arm statute, nor the bounds of constitutional due process.

Plaintiffs oppose the Motion and argue that federal jurisdiction in Delaware based upon civil RICO statutes, 18 U.S.C. §§ 1961 and 1964. Plaintiffs argue that Defendant engaged in a pattern across state lines that contains a sequence of events with the same and common purpose to defraud Agnes, and her successors in interest, of substantial Delaware assets, to protect the thieves of those assets, and to defraud State and Federal governments. Plaintiffs further argue that Defendant engaged in a conspiracy with unidentified Doe Defendants, and that in Delaware the exercise of personal jurisdiction over an individual may be appropriate based upon the actions of other Doe Defendants involved in the civil conspiracy.

A. Standard of Review

Federal Rule of Civil Procedure 12(b)(2) allows the Court to dismiss a suit for lack of jurisdiction over the person. Two requirements, one statutory and one constitutional, must be satisfied for personal jurisdiction to exist over a defendant. Bell Helicopter Textron, Inc. v. C & C Helicopter Sales, Inc., 295 F.Supp.2d 400, 403 (D.Del.2002). "First, a federal district court may assert personal jurisdiction over a nonresident of the state in which the court sits to the extent authorized by the law of that state." Id. (citing Fed.R.Civ.P. 4(e)). The Court must, therefore, determine whether there is a statutory basis for jurisdiction under the Delaware long arm statute. Id. (citing Del.Code Ann. tit. 10, § 3104(c)). "Second, because the exercise of jurisdiction must also comport with the Due Process Clause of the United States Constitution, the Court must determine if an exercise of jurisdiction violates [Defendants'] constitutional right to due process." Id. (citing International Shoe Co. v. Washington, 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945)).

A district court may exercise either general or specific jurisdiction over a defendant, for purposes of personal jurisdiction. Remick v. Manfredy, 238 F.3d 248, 255 (3d. Cir.2001) (citations omitted). General jurisdiction exists where the defendant maintains continuous and systematic contacts with the forum. Provident Nat'l Bank v. California Fed. Sav. & Loan Asso., 819 F.2d 434, 437 (3d Cir.1987). Specific jurisdiction is proper only when the "cause of action arises out of [the] defendant's forum-related activities, such that the defendant `should reasonably anticipate being haled into court' in that forum." Remick, 238 F.3d at 255.

"Once a jurisdictional defense has been raised, the plaintiff bears the burden of establishing with reasonable particularity that sufficient minimum contacts have occurred between the defendant and the forum state to support jurisdiction." Id. (citing Provident Nat'l Bank v. California Fed. Sav. & Loan Ass'n, 819 F.2d 434, 437 (3d Cir.1987)). "Plaintiffs may establish jurisdictional facts through sworn affidavits or other competent evidence." Time Share Vacation Club v. Atlantic Resorts, Ltd., 735 F.2d 61, 66 n. 9 (3d Cir.1984). "[A]t no point may a plaintiff rely on the bare pleadings alone in order to withstand a defendant's Rule 12(b)(2) motion to dismiss for...