Lab. Corp.. of Am. Holdings v. Caccuro

• Decision Date: 21 June 2011
• Docket Number: No. COA10–877.,COA10–877.
• Citation: 712 S.E.2d 696
• Parties: LABORATORY CORPORATION OF AMERICA HOLDINGS, Dianon Systems, Inc., Plaintiffs,v.Cindy CACCURO and Lakewood Pathology Associates, Inc. d/b/a Plus Diagnostics, Defendants.
• Court: North Carolina Court of Appeals

712 S.E.2d 696

LABORATORY CORPORATION OF AMERICA HOLDINGS, Dianon Systems, Inc., Plaintiffs,

v.Cindy CACCURO and Lakewood Pathology Associates, Inc. d/b/a Plus Diagnostics, Defendants.

No. COA10–877.

Court of Appeals of North Carolina.

June 21, 2011.

OPINION TEXT STARTS HERE

Appeal by defendant from order entered 21 April 2010 by Judge J.B. Allen, Jr. in Alamance County Superior Court. Heard in the Court of Appeals 27 January 2011.

Parker Poe Adams & Bernstein LLP, Raleigh, by Patricia T. Bartis and Matthew H. Mall, for plaintiffs-appellees.

Robinson & Lawing, LLP, Winston-Salem, by Michael L. Robinson and H. Stephen Robinson; and Winston & Strawn LLP, Washington, DC, by William G. Miossi, for defendant-appellant Cindy Caccuro.

GEER, Judge.

Defendant Cindy Caccuro appeals from an order denying her motion to dismiss for lack of personal jurisdiction. Because the trial court's unchallenged findings of fact support its conclusion that (1) the exercise of personal jurisdiction satisfies the requirements of our State's long-arm statute, N.C. Gen.Stat. § 1–75.4 (2009), and (2) Caccuro had sufficient minimum contacts with the State to satisfy the requirements of due process, we affirm the trial court's order.

Facts

Plaintiffs Laboratory Corporation of America Holdings (“LabCorp”) and Dianon Systems, Inc., a subsidiary of LabCorp, filed a complaint on 12 June 2009, an amended complaint on 6 October 2009, and a second amended complaint on or about 22 February 2010 against Caccuro, a former LabCorp employee, and Lakewood Pathology Associates, Inc. d/b/a/ PLUS Diagnostics, Caccuro's new employer. Plaintiffs asserted claims for relief against Caccuro for breach of contract, breach of the covenant of good faith and fair dealing, conversion, and unfair competition. With respect to PLUS Diagnostics, plaintiffs asserted claims for tortious interference with contract and unfair competition.

Plaintiffs alleged in their second amended complaint that, from February 2006 through November 2008, Caccuro worked for LabCorp as a Special Development Executive (“SDE”). In this capacity, she was responsible for developing new accounts and servicing existing accounts in Philadelphia, Pennsylvania, and the surrounding areas. According to the second amended complaint, Caccuro, during her employment, developed relationships with LabCorp customers and had access to LabCorp's highly confidential and proprietary information, including customer lists, pricing, marketing practices, methods of operation, and the needs and requirements of LabCorp's customers.

Plaintiffs alleged that after Caccuro terminated her employment in November 2008, she went to work for PLUS Diagnostics, a direct competitor of LabCorp, and violated the terms of the Non–Solicitation/Confidentiality Agreement (“Non–Solicitation Agreement”) she had executed with LabCorp. Specifically, plaintiffs claimed that Caccuro had unlawfully retained confidential and proprietary materials belonging to LabCorp and had solicited the business of a particular LabCorp customer for whom she had primary responsibility while a LabCorp employee.

Plaintiffs further alleged that on or about 2 June 2009, Caccuro called LabCorp's client services office, falsely represented herself as being a customer of LabCorp, and provided the customer's LabCorp account number in order to obtain confidential LabCorp information relating to that customer that she could then use to solicit the customer's business for her new employer. Plaintiffs asserted that Caccuro was acting on behalf of PLUS Diagnostics when she violated the terms of the Non–Solicitation Agreement and that she and PLUS Diagnostics “fraudulently sought LabCorp's confidential information to gain an unfair competitive advantage for the benefit of PLUS Diagnostics and to the detriment of LabCorp.”

In response to the complaint and first amended complaint, both Caccuro, a Pennsylvania resident, and PLUS Diagnostics, a nonresident corporation, filed joint motions to dismiss for lack of personal jurisdiction pursuant to N.C.R. Civ. P. 12(b)(2). After plaintiffs filed the second amended complaint, only Caccuro filed a motion to dismiss for lack of personal jurisdiction.¹ The trial court denied Caccuro's motion to dismiss, finding that jurisdiction over Caccuro is proper pursuant to N.C. Gen.Stat. § 1–75.4(5)(c), (d), and (e) and comports with due process requirements. Caccuro appealed from that order to this Court.

Discussion

Although the order denying Caccuro's motion to dismiss is an interlocutory order, her appeal of the trial court's Rule 12(b)(2) decision is proper under N.C. Gen.Stat. § 1–277(b) (2003). See Love v. Moore, 305 N.C. 575, 581, 291 S.E.2d 141, 146 (1982) (“[T]he right of immediate appeal of an adverse ruling as to jurisdiction over the person, under [N.C. Gen.Stat. § 1–277(b) ], is limited to rulings on ‘minimum contacts' questions, the subject matter of Rule 12(b)(2).”).

“A two-step analysis applies in determining whether a North Carolina court has personal jurisdiction over a nonresident defendant: ‘First, the transaction must fall within the language of the State's “long-arm” statute. Second, the exercise of jurisdiction must not violate the due process clause of the fourteenth amendment to the United States Constitution.’ ” Banc of Am. Secs. LLC v. Evergreen Int'l Aviation, Inc., 169 N.C.App. 690, 693, 611 S.E.2d 179, 182 (2005) (quoting Tom Togs, Inc. v. Ben Elias Indus. Corp., 318 N.C. 361, 364, 348 S.E.2d 782, 785 (1986)). It is well established that the long-arm statute is “to be liberally construed in favor of finding personal jurisdiction, subject only to due process considerations.” Dataflow Cos. v. Hutto, 114 N.C.App. 209, 212, 441 S.E.2d 580, 582 (1994).

When this Court reviews a trial court's ruling on a motion to dismiss for lack of personal jurisdiction, it considers “ ‘whether the findings of fact by the trial court are supported by competent evidence in the record ....’ ” Banc of Am., 169 N.C.App. at 694, 611 S.E.2d at 183 (quoting Replacements, Ltd. v. MidweSterling, 133 N.C.App. 139, 140–41, 515 S.E.2d 46, 48 (1999)). The trial court's conclusions of law are subject to de novo review. Cambridge Homes of N.C. Ltd. P'ship v. Hyundai Constr., Inc., 194 N.C.App. 407, 417, 670 S.E.2d 290, 298 (2008). Since Caccuro does not challenge the sufficiency of the evidence to support the trial court's findings, the only question is whether the findings support the court's conclusions of law.

I. Long–Arm Statute

We first address Caccuro's contention that the court erred in determining that jurisdiction is proper under N.C. Gen.Stat. § 1–75.4(5)(d), the subsection of the long-arm statute that provides:

A court of this State having jurisdiction of the subject matter has jurisdiction over a person served in an action pursuant to Rule 4(j), Rule 4(j1), or Rule 4(j3) of the Rules of Civil Procedure under any of the following circumstances:

....

(5) Local Services, Goods or Contracts.—In any action which:

....

d. Relates to goods, documents of title, or other things of value shipped from this State by the plaintiff to the defendant on his order or direction[.]

The trial court found and Caccuro does not dispute that during Caccuro's employment with LabCorp, plaintiffs made money payments to Caccuro by sending checks to her. There is no question that these checks constituted “a ‘thing of value’ within the meaning of the long-arm statute.” Hiwassee Stables, Inc. v. Cunningham, 135 N.C.App. 24, 27, 519 S.E.2d 317, 320 (1999) (quoting Pope v. Pope, 38 N.C.App. 328, 331, 248 S.E.2d 260, 262 (1978)).

The question in this case is whether those “things of value” were sent from North Carolina at Caccuro's request. Caccuro insists that N.C. Gen.Stat. § 1–75.4(5)(d) is inapplicable because she did not specifically direct that plaintiffs send the checks from North Carolina. This Court, however, rejected that argument in Cherry Bekaert & Holland v. Brown, 99 N.C.App. 626, 394 S.E.2d 651 (1990).

The defendant in Cherry Bekaert withdrew from the plaintiff's partnership in North Carolina, moved to Alabama, and demanded money owed to him. Id. at 631, 394 S.E.2d at 655. In support of his motion to dismiss for lack of personal jurisdiction, the defendant argued that the plaintiff could have chosen to pay him from accounts in states other than North Carolina, but that the plaintiff—and not the defendant—chose to use a North Carolina account. Id. at 630, 394 S.E.2d at 655. According to the defendant, “a strict interpretation of N.C.G.S. § 1–75.4(5)(d) ... would require personal jurisdiction only if defendant's ‘order or direction’ specifies that plaintiff ship from this state a thing of value.” Id. at 631, 394 S.E.2d at 655.

This Court rejected the defendant's argument as “untenable in light of our courts' policy of liberally and broadly construing statutory jurisdictional requirements in favor of finding personal jurisdiction.” Id. The Court held that “[b]ecause defendant directed plaintiff to send his monies to him in Alabama and plaintiff distributed the money from North Carolina, the money paid is ‘shipped from this State by the plaintiff to ... defendant on his order or direction.’ ” Id. (quoting N.C. Gen.Stat. § 1–75.4(5)(d)). In other words, under Cherry Bekaert, all that is required to satisfy N.C. Gen.Stat. § 1–75.4(5)(d) is that a defendant demanded money from the plaintiff and the plaintiff paid the money from North Carolina.

According to the trial court's unchallenged findings of fact in this case, Caccuro chose to enter into a Non–Solicitation Agreement and two Compensation Plans providing for her receipt of compensation payments from LabCorp. Under Cherry Bekaert, because Caccuro contracted to receive compensation from LabCorp and directed LabCorp to send her checks to her out of state, and LabCorp distributed the checks from North Carolina, the checks were “ ‘shipped from this State by the plaintiff to ... defendant on his order or direction.’ ...