Joshua Props., LLC v. D1 Sports Holdings, LLC.

• Decision Date: 30 January 2014
• Docket Number: No. 2012–IA–01467–SCT.,2012–IA–01467–SCT.
• Citation: 130 So.3d 1089
• Court: Mississippi Supreme Court
• Parties: JOSHUA PROPERTIES, LLC, Performance Sports Academy, LLC and Chris Snopek v. D1 SPORTS HOLDINGS, LLC.

130 So.3d 1089

JOSHUA PROPERTIES, LLC, Performance Sports Academy, LLC and Chris Snopek

v.D1 SPORTS HOLDINGS, LLC.

No. 2012–IA–01467–SCT.

Supreme Court of Mississippi.

Jan. 30, 2014.

Terris Caton Harris, Dennis C. Sweet, III, Jackson, William (BO) Roland, attorneys for appellants.

Christopher Lamar Wansley, Armin J. Moeller, Jr., Jackson, attorneys for appellee.

Before RANDOLPH, P.J., PIERCE and KING, JJ.

PIERCE, Justice, for the Court:

¶ 1. Joshua Properties, LLC; Performance Sports Academy, LLC; and Chris Snopek (all referred to as “Snopek”), filed suit against St. Dominic Health Services, Inc. (St.Dominic); D1 Sports Holdings, LLC (D1 TN); and D1 Sports Training of Mississippi, LLC (D1 MS) in the Circuit Court of the First Judicial District of Hinds County, Mississippi. D1 TN moved for dismissal based on lack of personal jurisdiction and failure to state a claim. After a hearing on the matter, the trial court entered an order granting D1 TN's motion based on a lack of personal jurisdiction over the party. Snopek subsequently was granted this interlocutory appeal seeking this Court's ruling on whether personal jurisdiction exists in Mississippi over D1 TN. We find that personal jurisdiction does exist over D1 TN.

¶ 2. D1 TN relies on Public Employees' Retirement System v. Hawkins, 781 So.2d 899, 900–01 (Miss.2001), in which this Court, in the interest of justice, considered issues that were not raised in the petition for interlocutory appeal, to assert in the alternative that this case should be dismissed for failure to state a claim pursuant to Mississippi Rule of Civil Procedure 12(b)(6). D1 TN properly raised this issue before the trial court, however, the trial court did not rule on the issue; therefore, we will not address this issue for the first time on appeal.

STATEMENT OF THE FACTS

¶ 3. In 2007, Snopek proposed to St. Dominic the concept of working together in opening a multi-use sports complex for the Jackson metropolitan area. Through Joshua Properties, LLC, land was located for the complex in Madison County, Mississippi. After Snopek and St. Dominic collaborated over the designs and plans for the complex, the parties entered into a letter of intent. The letter of intent included the purchase of property located through Joshua Properties, LLC, but the letter was subject to expiration on February 28, 2008. The property was never acquired, and the letter of intent expired. However, Snopek alleges that the parties continued to move forward with the project together.

¶ 4. In December 2009, Snopek contacted D1 TN, a limited liability company formed under Tennessee state law, which has its principal place of business in Tennessee, and is not qualified to conduct business in the state of Mississippi. Snopek proposed to D1 TN the idea of becoming involved in the development of the sports complex by aiding with the sports and fitness aspects of the project, since D1 TN's business focuses on custom sports-training programs, expert coaching, and sports therapy. D1 TN displayed an interest in becoming involved in the endeavor.

¶ 5. Snopek provides that it thereafter introduced D1 TN to St. Dominic, and all of the parties together moved forward with the opening of the sports complex. D1 TN states that it discussed the project with Snopek only one time, in December 2009. D1 TN further states that it was contacted by St. Dominic around September 2010 about collaborating to create a sports-training facility in Madison County, Mississippi.

¶ 6. St. Dominic and D1 TN worked together to form D1 MS, which was created to manage the operations of St. Dominic's sports-training facility. D1 MS's members are comprised of St. Dominic and D1 TN. In late 2011, St. Dominic published its collaboration with D1 TN in undertaking the building of a sports-training facility in Madison, Mississippi.

¶ 7. Thereafter, Snopek initiated suit against St. Dominic, D1 MS, and D1 TN, alleging-breach of fiduciary duties, misappropriation of trade secrets, tortious interference with prospective advantage, unfair competition, civil conspiracy, and usurpation of business opportunity. On D1 TN's motion to dismiss, the trial court ruled that personal jurisdiction did not exist over D1 TN in Mississippi for the purposes of this action. Snopek then filed a motion for interlocutory appeal with this Court.

ANALYSIS

Whether personal jurisdiction exists in Mississippi over D1 Sports Holdings, LLC.

¶ 8. Jurisdictional issues are reviewed pursuant to a de novo standard of review. McDaniel v. Ritter, 556 So.2d 303, 308 (Miss.1989) (citing MISS CAL 204, Ltd. v. Upchurch, 465 So.2d 326, 330 (Miss.1985)). Jurisdiction is decided based on the existing facts at the time the action is commenced. Estate of Jones v. Phillips ex rel. Phillips, 992 So.2d 1131, 1137 (Miss.2008) (citing Euclid–Mississippi v. Western Cas. & Sur. Co., 249 Miss. 547, 554, 163 So.2d 676, 679 (1964)).

¶ 9. Determining whether personal jurisdiction can be exercised over a nonresident defendant involves a two-part analysis. Phillips, 992 So.2d at 1137 (citing Sorrells v. R & R Custom Coach Works, Inc., 636 So.2d 668, 671 (Miss.1994)). First, we must analyze and decide if the Mississippi long-arm statute is applicable to D1 TN. Phillips, 992 So.2d at 1137 (citing Sorrells, 636 So.2d at 671). Second, we must determine if applying the long-arm statute to D1 TN comports with the Due Process Clause of the Fourteenth Amendment and the U.S. Constitution. Id.

1. Mississippi Long–Arm Statute

¶ 10. Mississippi Code Section 13–3–57 sets forth the following occurrences which subject a nonresident to personal jurisdiction within the state of Mississippi:

Any nonresident person, firm, general or limited partnership, or any foreign or other corporation not qualified under the Constitution and laws of this state as to doing business herein, who shall make a contract with a resident of this state to be performed in whole or in part by any party in this state, or who shall commit a tort in whole or in part in this state against a resident or nonresident of this state, or who shall do any business or perform any character of work or service in this state, shall by such act or acts be deemed to be doing business in Mississippi and shall thereby be subjected to the jurisdiction of the courts of this State.

Miss.Code Ann. § 13–3–57 (Rev.2012).

¶ 11. Snopek alleges that D1 TN committed a tort in the state, entered into a contract in the state, and conducted business within the state. Because we find that D1 TN was “doing business” within the state in accordance with the long-arm statute, we will not address whether D1 TN committed a tort or entered into a contract in the state. Phillips, 992 So.2d at 1139.

¶ 12. Before the long-arm statute was amended in 1991, the “doing business” element of the statute could not be applicable to a nonresident defendant without a connection between the cause of action and the business, work, or service taking place within the state. Phillips, 992 So.2d at 1139 (citing Mladinich v. Kohn, 250 Miss. 138, 147, 164 So.2d 785, 790 (1964)). After the statute was amended, the “nexus” requirement between the cause of action and the business being conducted within the state was eliminated. Phillips, 992 So.2d at 1139 (citing Gross v. Chevrolet Country, Inc., 655 So.2d 873, 878 (Miss.1995)). Currently, “... the long-arm statute, by its plain terms, applies to any person or corporation performing any character of work in this state.” Phillips, 992 So.2d at 1139;see ITL Int'l, Inc. v. Constenla, S.A., 669 F.3d 493, 498 (5th Cir.2012); Davenport v. Hansaworld USA, No. 2:12–CV–233–KS–MTP, 2013 WL 5406900, at *4 (S.D.Miss. Sept. 25, 2013).

¶ 13. D1 TN contends that it is “joint owners” of D1 MS with St. Dominic. As previously mentioned, D1 TN and St. Dominic are the members of D1 MS, an LLC. D1 TN created the LLC with St. Dominic via telephone and email communication. D1 TN executed the documents to create D1 MS and electronically provided the documents to St. Dominic. Will Bartholomew, on behalf of D1 TN, traveled to Mississippi on the following occasions: (1) to meet with medical professionals at Mississippi Sports Medicine and Orthopedic Center, (2) to meet with St. Dominic regarding the creation of D1 MS, (3) to further discuss the creation of D1 MS with St. Dominic, (4) to finalize the creation of D1 MS with St. Dominic, (5) to discuss real estate options for the location of D1 MS, and (6) to attend the ground breaking for D1 MS.

¶ 14. D1 TN argues that it is not conducting business within the state so as to render it amenable to suit under the state long-arm statute because D1 TN has never conducted the following transactions within the state: (1) held an office or place of business, (2) solicited business on behalf of itself or through an agent, (3) contracted on behalf of itself or through an agent to supply goods and services, (4) maintained a Mississippi bank account, (5) obtained a telephone listing, (6) paid income taxes, (7) owned any real property, or (8) purposefully solicited, marketed, or promoted itself.D1 TN cites Roxco, Ltd. v. Harris Specialty Chemicals, Inc., 133 F.Supp.2d 911, 916 (S.D.Miss.2000), in which that court held the defendants made “transient” visits within the state to inspect products, but were not “doing business” within Mississippi because they did not sell products directly to residents, did not obtain a bank account in state, did not have a telephone listing, and did not own or lease real property. We find this argument to be without merit.

¶ 15. Looking to the plain language of the long-arm statute, we find that D1 TN was conducting business within the state and that it subjected itself to suit, considering the sum of its activities. D1 TN collaborated with St. Dominic about creating a sports-training facility in the state, communicated and planned with St. Dominic furthering its formation, participated in meetings in the state,...