Guffey v. Odil Ostonakulov, Individually & Motorcars of Nashville Inc.

• Decision Date: 11 February 2014
• Docket Number: No. 112,270.,112,270.
• Citation: 321 P.3d 971
• Parties: Samantha GUFFEY, individually, Plaintiff/Appellant, v. Odil OSTONAKULOV, individually and Motorcars of Nashville Inc. a Tennessee corporation, Defendants/Appellees.
• Court: Oklahoma Supreme Court

321 P.3d 971

Samantha GUFFEY, individually, Plaintiff/Appellant,

v.Odil OSTONAKULOV, individually and Motorcars of Nashville Inc. a Tennessee corporation, Defendants/Appellees.

No. 112,270.

Supreme Court of Oklahoma.

Feb. 11, 2014.

On Appeal from the District Court of Oklahoma County; Honorable Bryan C. Dixon, District Judge.

¶ 0 Plaintiff/Appellant Samantha Guffey (Guffey), an Oklahoma resident, filed a lawsuit against Defendants Odil Ostonakulov (Ostonakulov) and Motorcars of Nashville, Inc. (MNI), a resident of Tennessee and a Tennessee corporation, respectively, in the District Court of Oklahoma County. Guffey alleged fraud and violations of the Oklahoma Consumer Protection Act, 15 O.S. § 751 et seq. in connection with her purchase of a vehicle from Defendants using the auction site eBay. On September 20, 2013, the trial court dismissed the action because it determined Oklahoma lacked jurisdiction over Defendants. Guffey appealed. We hold that because Defendants possessed sufficient minimum contacts with the State of Oklahoma, the district court possessed in personam jurisdiction over Defendants.

Paul E. Quigley, Quigley, Henry & Hill, Oklahoma City, Oklahoma, for Plaintiff/Appellant.

Craig Edward Brown and Evan A. McCormick, Wheeler, Wheeler, Morgan, Faulkner and Brown, Oklahoma City, Oklahoma, for Defendants/Appellees.

COMBS, J.:

¶ 1 The only question presented on appeal is whether the district court possesses in personam jurisdiction over a Tennessee individual and corporation, who sold a motor vehicle to an Oklahoma resident. We hold that the district court possesses jurisdiction. The totality of contacts in this cause indicates that the exercise of in personam jurisdiction is proper and does not violate the due process rights of Defendants/Appellees.

Alleged Facts and Procedural History

¶ 2 Guffey is a resident of Oklahoma County, Oklahoma. Ostonakulov is a resident of the State of Tennessee and MNI is a Tennessee corporation with its principle place of business in Nashville, Tennessee. MNI operates a used car lot in Nashville, Tennessee. On or about June 11, 2012, Guffey was the winning bidder on a used 2009 Volvo XC 90 listed for auction on eBay, Inc. by MNI. Guffey, after receiving the vehicle, determined that the vehicle was not in the condition advertised, and filed a Petition in the District Court of Oklahoma County on December 19, 2012. In her petition, Guffey alleged Defendants engaged in fraud as well as violations of the Oklahoma Consumer Protection Act, 15 O.S. § 751 et seq.

¶ 3 On May 10, 2013, Defendants moved to dismiss for lack of personal jurisdiction pursuant to 12 O.S.2011 § 2012(B)(2), on the grounds that they did not possess minimum contacts with Oklahoma sufficient for the state to exercise in personam jurisdiction without implicating due process concerns. ¹ Guffey filed a Response to Defendants' Motion to Dismiss and Motion to Allow Amended Petition on June 24, 2013, arguing that in personam jurisdiction was proper because the minimum contacts requirement has been satisfied. Guffey's Response also included an affidavit by her attesting to the facts she alleges are sufficient to provide for in personam jurisdiction.

¶ 4 Guffey's affidavit provides that she bid on the Volvo that is the subject of the underlying dispute on eBay in part based on a thirty-day limited warranty after the purchase, included in the record. Guffey's affidavit indicates that after she bid, but several days before the closing date of the auction, she received an email solicitation from Ostonakulov suggesting she contact him by phone and negotiate a buy it now price for the vehicle. She chose not to do so, but only after calling and speaking with him personally about the matter. After she discovered that she won the auction with the highest bid, she asserts she had her father call and speak to Ostonakulov about the final details of the matter and payment instructions. She then signed a purchase agreement that was mailed to her father's offices in Oklahoma City by Ostonakulov, and returned it to Tennessee. Ostonakulov also helped to arrange shipping of the vehicle to Oklahoma, where Guffey took delivery.

¶ 5 Guffey further asserts that this eBay sale is not an isolated transaction for Defendants, and that they are an active “power seller” on eBay, averaging 12–35 cars for sale every day, and advertising 942 cars on the site. Guffey also asserts that she knows of at least three cars sold by Defendants in the state of Oklahoma, and believes they have sold more than thirty cars to residents of the state.

¶ 6 With leave of the trial court, Guffey filed an Amended Petition on July 28, 2013, containing many of the facts she first provided in her affidavit, alleging an exercise of in personam jurisdiction over the Defendants by the trial court was proper. Defendants again moved to dismiss on July 17, 2013, asserting that because Guffey's Amended Petition contained no affidavit or other written materials, to support its stated facts, that would support its jurisdictional allegations, it was facially deficient and did not comport with a prima facie showing of personal jurisdiction over Defendants.

¶ 7 Guffey filed a response to the Defendants' second motion to dismiss on August 2, 2013, asserting that her Amended Petition and the affidavit accompanying her Response to Defendants' first motion to dismiss were sufficient to illustrate the existence of minimum contacts so as to justify the trial court's exercise of in personam jurisdiction, and requesting time from the trial court to conduct discovery with regard to Ostonakulov's contacts with the State of Oklahoma.

¶ 8 The trial court held a hearing on Defendants' second Motion to Dismiss on November 6, 2013, where the parties argued the issue of in personam jurisdiction. In an order dated September 20, 2013, the trial court sustained Defendants' Motion to Dismiss and dismissed the action for lack of in personam jurisdiction over Defendants.² Guffey appealed, and this cause was retained on the Court's own motion and assigned to this office on November 20, 2013.

Standard of Review

¶ 9 In Oklahoma, a special appearance with a motion to dismiss is the proper method for challenging in personam jurisdiction. Powers v. District Court of Tulsa County, 2009 OK 91, ¶ 7, 227 P.3d 1060;In re Turkey Creek Conservancy District, 2008 OK 8, n. 4, 177 P.3d 558;Southard v. Oil Equipment Corp., 1956 OK 74, 296 P.2d 780.In Powers, this Court explained that a defendant challenging in personam jurisdiction has an initial procedural burden to raise the facts challenging in personam jurisdiction, usually by accompanying a motion to dismiss with an affidavit or a statement from the attorney what proof would be shown at an evidentiary hearing, to be followed by a response from the party asserting jurisdiction also accompanied by affidavits. Powers, 2009 OK 91, ¶ 7, 227 P.3d 1060.

¶ 10 When in personam jurisdiction is challenged, the jurisdiction over a non-resident defendant cannot be inferred, but instead must affirmatively appear from the trial court record, and the burden of proof in the trial court is upon the party asserting that jurisdiction exists. Powers, 2009 OK 91, ¶ 7, 227 P.3d 1060;Gilbert v. Security Finance Corp., 2006 OK 58, ¶ 2, 152 P.3d 165;Conoco, Inc. v. Agrico Chemical Co., 2004 OK 83, ¶ 20, 115 P.3d 829. The determination of in personam jurisdiction is a legal ruling, subject to de novo review by this Court, and this Court will canvas the record for proof ³ that the nonresident party had sufficient contacts with the state to assure that traditional notions of fair play and substantial justice will not be offended if this state exercises in personam jurisdiction. Conoco, Inc., 2004 OK 83, ¶¶ 9 & 20, 115 P.3d 829.

¶ 11 In Personam Jurisdiction Requires Sufficient Minimum Contacts with the State of Oklahoma so that the Exercise of Jurisdiction Does not Offend Traditional Notions of Fair Play and Substantial Justice.

¶ 12 In personam jurisdiction is the power to deal with the person of the defendant and render a binding judgment against that defendant. Conoco, Inc. v. Agrico Chemical Co., 2004 OK 83, ¶ 16, 115 P.3d 829;Gilbert v. Security Finance Corp. of Oklahoma, Inc., 2006 OK 58, ¶ 16, 152 P.3d 165;Hobbs v. German–American, 1904 OK 60, ¶ 5, 14 Okla. 236, 78 P. 356.In personam jurisdiction may be acquired either by service of process or by voluntary appearance before the court. Conoco, Inc., 2004 OK 83, ¶ 16, 115 P.3d 829.Title 12 O.S. Supp.2012 § 2004(F), known as the long-arm statute, allows jurisdiction over non-residents in Oklahoma court's by providing for service of process outside of the state. Mastercraft Floor Covering, Inc. v. Charlotte Flooring, Inc., 2013 OK 87, ¶ 10, 313 P.3d 911;Conoco, Inc., 2004 OK 83, ¶ 16, 115 P.3d 829.Title 12 O.S. Supp.2012 § 2004(F) provides: “[a] court of this state may exercise jurisdiction on any basis consistent with the Constitution of this state and the Constitution of the United States.”

¶ 13 This Court has previously stated that the intent of the long-arm statute is to extend the jurisdiction of Oklahoma courts over non-residents to the outer limits permitted by the Oklahoma Constitution and the due process clause of the United States Constitution. Mastercraft Floor Covering, Inc., 2013 OK 87, ¶ 10, 313 P.3d 911;Conoco, Inc., 2004 OK 83, ¶ 17, 115 P.3d 829;Fields v. Volkswagen of America Inc., 1976 OK 106, ¶ 6, 555 P.2d 48. The outer limits of what constitutes due process in regard to in personam jurisdiction have been set and described in some detail by the Supreme Court of the United States. Conoco, Inc., 2004 OK 83, ¶ 17, 115 P.3d 829.

¶ 14 In the seminal case of International Shoe Co. v. State of Washington, Office of Unemployment Compensation and Placement et al., 326 U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945), the Supreme Court of the United States created what is colloquially deemed the minimum contacts...