Horowitz v. Laske

• Decision Date: 17 December 1999
• Docket Number: No. 98-1944.,98-1944.
• Citation: 751 So.2d 82
• Parties: Marvin I. HOROWITZ & Horowitz & Gudeman, P.C., Appellant, v. Edward LASKE & Ruth E. Laske, etc., Appellees.
• Court: Florida District Court of Appeals

751 So.2d 82

Marvin I. HOROWITZ & Horowitz & Gudeman, P.C., Appellant, v. Edward LASKE & Ruth E. Laske, etc., Appellees.

No. 98-1944.

District Court of Appeal of Florida, Fifth District.

December 17, 1999.

Philip D. Parrish of Stephens, Lynn, Klein & McNicholas, P.A., Miami, for Appellant.

Robert E. Austin, Jr. and Bradford D. Fisher of Austin & Pepperman, P.A., Leesburg, for Appellees.

THOMPSON, J.

Marvin Horowitz, a Michigan attorney, and Horowitz & Gudeman, P.C. (collectively, "Horowitz"), a Michigan law firm, third-party defendants below, appeal from a non-final order denying a motion to dismiss the third-party complaint for lack of personal jurisdiction. We have jurisdiction under Florida Rule of Appellate Procedure 9.130(a)(3)(C)(i). Because Horowitz's acts are insufficient to subject Horowitz to Florida's long-arm jurisdiction under Section 48.193, Florida Statutes, we reverse.

Edward and Ruth Laske (collectively, "Laske"), individually and on behalf of similarly situated individuals, filed a class action against Bernard Wendt ("Wendt"). Laske contends that Wendt played an active role as a broker and a promoter for the sale of K.D. Trinh Investments, Inc. ("K.D.Trinh") notes, which turned out to be worthless. Laske alleges that the sale of the notes violated security laws. Wendt, in turn, filed his third-party complaint, and then an amended third-party complaint, against several parties, including Horowitz. Horowitz had been retained by K.D. Trinh as outside counsel to advise K.D. Trinh, a Canadian corporation, on a number of matters pertaining to the sales of these notes and other securities matters in the United States. Wendt alleged that he relied to his detriment on legal advice given by Horowitz.

Marvin Horowitz is a non-resident attorney and Horowitz & Gudeman, P.C. is a non-resident law firm. To determine whether nonresident defendants are subject to the jurisdiction of Florida's courts, two inquiries must be made. First, it must be determined that the complaint alleges sufficient jurisdictional facts to bring the action within the ambit of Section 48.193, Florida Statutes. If it does, the following inquiry is whether sufficient "minimum contacts" are demonstrated to satisfy due process requirements. See Venetian Salami Co. v. Parthenais, 554 So.2d 499, 502 (Fla.1989)

(quoting Unger v. Publisher Entry Serv., Inc., 513 So.2d 674, 675 (Fla. 5th DCA 1987)); Texas Guaranteed Student Loan Corp. v. Ward, 696 So.2d 930, 932 (Fla. 2d DCA 1997); see also Hill v. Sidley & Austin, 762 F.Supp. 931, 933 (S.D.Fla.1991)(citing Madara v. Hall, 916 F.2d 1510, 1514 (11th Cir.1990)).

The amended third-party complaint, in order to establish in personam jurisdiction, alleged that:

4. Horowitz is an attorney who was at all times material hereto licensed to practice law, held himself out as an attorney knowledgeable in commercial and securities laws, and;

(a) Engaged in a business in the State of Florida, that being the practice of law, by (1) representing a foreign corporation and a Florida resident with respect to an investigation by a state administrative agency, more particularly by responding through written and telephonic communications to the Division of Securities regarding the investigation by the Division of Securities concerning the alleged sale of unregistered securities by K.D. Trinh to Florida residents, (2) giving advice purposely directed toward Florida residents and communicating by mail and wire with Florida Residents [sic] regarding the legality of K.D. Trinh's financing program, (3) drafting loan documents that were knowingly intended by him to be evidence of loans to be made by Florida residents to K.D. Trinh, and (4) drafting agency agreements for execution by K.D. Trinh and its Florida agents relating to K.D. Trinh's financing program;

(b) Committed a tortious act in Florida by (1) negligently responding in writing to an investigation by the Division of Securities relating to the alleged sale of unregistered securities and (2) negligently drafting loan documents that were knowingly intended by him to be evidence of loans to be made by Florida residents to K.D. Trinh without appropriate consideration being given to Florida securities laws and restrictions on allowable interest, all of which resulted in Florida residents' sustaining personal injuries and monetary losses and being subjected to administrative, civil, and criminal proceedings; and

(c) Caused personal injury to persons within the state of Florida arising out of acts or omissions by him outside of the State of Florida while he was engaged in service activities in the State of Florida; more particularly, he negligently advised K.D. Trinh with respect to the legality of the loans made and to be made by Florida residents and the related notes and negligently responded to the investigation by the Division of Securities relating to those loans and notes, all of which resulted in Florida residents' [sic] sustaining personal injuries and monetary losses and being subjected to administrative, civil, and criminal proceedings.

5. Horowitz-Gudeman is a Michigan professional corporation which through its agent Horowitz held itself out as a law firm knowledgeable in commercial and securities laws and which through its agent Horowitz engaged in the activities and committed the acts described in paragraph 4 hereof.

"In order to challenge allegations in a complaint regarding jurisdiction or the sufficiency of minimum contacts, a defendant must file affidavits to support its position." Texas Guaranteed Student Loan Corp. v. Ward, 696 So.2d 930, 932 (Fla. 2nd DCA 1997) (citing Venetian Salami, 554 So.2d at 502). In support of its motion to dismiss for lack of personal jurisdiction, Horowitz filed an affidavit in which Marvin Horowitz averred that: he was a resident of the State of Michigan; was duly licensed to practice law in Michigan; had never been a resident of the State of Florida; had never solicited or conducted personal business within the State of Florida; his contacts with any party or entity in the State of Florida had been on behalf of a client or employer and those contacts had only involved telephonic or mail correspondence and never involved travel to Florida; that he had not traveled to Florida within the past eight years; he had never knowingly received any compensation directly from a Florida resident or entity or a non-Florida resident or entity while that party was in Florida. The affidavit reiterated these same claims as to his law firm. This affidavit refuted the allegations made in the Third-Party First Amended Complaint. The burden thus shifted to Wendt to prove by affidavit the basis for jurisdiction. After a limited hearing on Horowitz's motion, Wendt submitted materials, including deposition transcripts, for the trial court to consider in making its ruling. These transcripts and records reveal that Horowitz did have some scant contact with parties and entities within the state of Florida during 1994 and 1995, due to the two inquiries made by the state regarding whether K.D. Trinh was selling unregistered securities. These materials also indicated that Horowitz prepared certain loan documents for K.D. Trinh which K.D. Trinh then used in Florida.

The contacts as to the first state inquiry, which arose in mid-1994, included: a letter on June 17, 1994 from Horowitz to George Hermann, a Florida-based K.D. Trinh broker, reassuring Hermann regarding the State's inquiry into the nature of the K.D. Trinh notes; a phone call from Horowitz to Hermann¹ on June 20, 1994; a letter on July 7, 1994, to Lynn Chang, an investigator for the Florida Department of Banking and Finance, regarding the State's...