Miller v. Calotychos

• Decision Date: 29 January 2004
• Docket Number: No. 03 Civ. 4273(VM).,03 Civ. 4273(VM).
• Citation: 303 F.Supp.2d 420
• Parties: Julian MILLER, Plaintiff, v. Yannis CALOTYCHOS, Victoria Thompson and iView Multimedia, Ltd., Defendants.
• Court: U.S. District Court — Southern District of New York

303 F.Supp.2d 420

Julian MILLER, Plaintiff, v. Yannis CALOTYCHOS, Victoria Thompson and iView Multimedia, Ltd., Defendants.

No. 03 Civ. 4273(VM).

United States District Court, S.D. New York.

January 29, 2004.

Richard J.J. Scarola, Scarola, Reavis & Parent, New York City, for Plaintiff.

Toby Michael John Butterfield, Cowan, Debates, Abrahams and Sheppard, L.L.P., New York City, for Defendants.

DECISION AND ORDER

MARRERO, District Judge.

In this action, plaintiff Julian Miller ("Miller"), a citizen of the United States and resident of Hawaii, asserts various claims arising out of his computer software business relationship with defendants Yannis Calotychos ("Calotychos"), Victoria Thompson ("Thompson") and iView Multimedia, Ltd. ("iView") (collectively "Defendants"). Calotychos and Thompson, who are married to each other, are citizens and residents of the United Kingdom, and iView is a corporation formed by them in the United Kingdom. Before the Court is Defendants' motion to dismiss Miller's complaint on the ground that the Court lacks personal jurisdiction over Defendants or, alternatively, that New York is not a convenient forum for the litigation of this matter. For the reasons described below the motion is denied.

I. FACTS¹

Miller asserts in his complaint that his business contacts with Defendants commenced sometime in 1996. At that time, he came across an internet browser program operated by Calotychos. Miller proposed that he and Calotychos develop a version of the program to market commercially. Communicating primarily through electronic means from Nevada and later Hawaii and England, the parties entered into a licensing arrangement in June 1998 that ultimately led to the incorporation of iView. Miller alleges that under his initial written agreement with Calotychos, Miller was to serve as a distributor of the software, but that the arrangement was subsequently modified, by oral agreement reached between them through discussions by e-mail and the telephone, into a business development partnership in which each was to own 50 percent of the venture. The business was incorporated by Calotychos and Thompson in the United Kingdom in 1998. According to Miller, the underlying dispute arose in part when Calotychos insisted that Thompson be given a substantial equity interest in the corporation. Calotychos and Thompson, denying that any agreement with Miller ever existed granting him an equity share in the company and asserting that they are its sole owners, terminated their relationship with Miller following a meeting among the parties in New York in 2001.

On these pleadings, Miller asserts six claims: breaches of contract and of joint venture agreement; conversion of his share of iView profits and their wrongful distribution to Calotychos and Thompson; replevin for his shares of iView stock; and declaratory relief seeking judgments that he owns a 50 percent equity interest in iView and that he is a co-author of three software programs which Miller claims were created in collaboration between him and Calotychos.

The jurisdictional dispute raised by Defendants' motion concerns the extent of the parties' dealings relating to iView business that occurred in New York. Miller claims that during the time of his involvement with the venture, iView's business was largely directed at a customer market and Macintosh program applications industry and licensing partners located in the United States, and that New York was the company's principal target for business development and marketing. Specifically, Miller claims that he first met Calotychos and Thompson at a MacWorld Conference and Exposition, held in New York over six days in July 1999, and that they all attended at the invitation of Adaptec, a new licensee of iView. According to Miller, over several days at this convention he and Calotychos reaffirmed their agreement and solidified their business relationship by collaborating in promoting iView software programs to other companies, working with Adaptec representatives in supporting a new Adaptec product, and together holding themselves out as iView's two principals.

Miller also attests that he and Calotychos and Thompson again engaged in iView business transactions in New York at the 2001 MacWorld conference at which iView rented a booth. During the course of that event, according to Miller, he, Calotychos and Thompson met in New York with the principals of Center for Digital Imaging ("CDI"), a software company based in New York, and initiated a business relationship between CDI and iView. Miller claims that while in New York he also met to discuss iView business with an official of Nikon, and arranged for the sale of iView Software through several retail outlets and for bulk licenses with Conde Nast and Time, Inc., and that he and Calotychos met with representatives of Minolta, Apple Computer, VST, a hardware maker, and with photo journalists, graphic designers and other industry agents.

Miller asserts that after the convention, he, Calotychos and Thompson remained in New York and met for an entire day to continue discussions concerning differences of opinion that had arisen among them relating to the company's ownership and management, specifically the denial by Calotychos and Thompson, implicit in a draft distributorship agreement Thompson had transmitted to Miller prior to the convention, of Miller's claim that he owned a substantial equity interest in iView. This meeting included participation by Mark Fleming, a computer software engineer resident of Canada who worked with Miller and Calotychos as a technical consultant developing programs for iView. (See Fleming Decl, ¶ 1-2.) Miller states that he refused to sign the draft distributorship agreement, maintaining that it did not reflect his ownership of an equity share of the company.

Finally, Miller asserts that iView maintains a fully interactive website through which its software products may be directly ordered from New York and that Defendants reserved a booth at the 2003 MacWorld conference but did not attend by reason of the instant litigation.

In support of their motion and responding to Miller's contentions, Defendants assert that they are not now and never were present in New York for jurisdictional purposes; that they did not negotiate, enter or execute any agreement with Miller in New York; and that they have no offices, agents, bank accounts or other assets, advertising or continuing business relations with any New York company. According to Defendants, Calotychos' written agreement with Miller had no connection with New York, and neither did the oral modification of their contract Miller claims was made in 1998, both allegedly concluded long before the parties' first personal encounter in New York in July 1999. Defendants contend that on the two occasions the parties did meet in New York in 1999 and 2001, their discussions were not substantive, did not involve Miller's ownership interest in iView and were not essential to the formation of the alleged contract or to the advancement of the parties' business relationship, and therefore had no importance for jurisdictional purposes. By Calotychos' account, when Defendants visited New York in 1999, it was only as a stopover at Adaptec's invitation, on their way to business meetings in California. Of the parties' 2001 discussion, Calotychos asserts that it was a "very brief meeting" at which they endeavored to resolve "whether [Miller] was willing to sign the Sales Negotiator and Rep Agreement and, if so, whether we could agree on whether [Miller] should become a shareholder of iView." (Calotychos Aff. ¶ 15.) Calotychos also acknowledges that he visited New York again in September 2001 to meet with Nikon representatives and in 2002 to attend the MacWorld expo, where iView rented a booth.

II. DISCUSSION

Miller contends that this Court has personal jurisdiction over Defendants pursuant to New York Civil Practice Law and Rules ("CPLR") §§ 302(a)(1) and 301. Defendants challenge the application of those provisions to this case and assert that exercise of jurisdiction would also offend the requirements of due process necessary to satisfy constitutional standards. See International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945); Asahi Metal Indus. Co., Ltd. v. Superior Court, 480 U.S. 102, 113, 107 S.Ct. 1026, 94 L.Ed.2d 92 (1987).

A. STANDARD OF REVIEW

At this stage of the litigation, "`prior to discovery, a plaintiff challenged by a jurisdiction testing motion may defeat the motion by pleading in good faith ... legally sufficient allegations of jurisdiction,' i.e., by making a `prima facie showing' of jurisdiction." Jazini v. Nissan Motor Co., Ltd., 148 F.3d 181, 184 (2d Cir.1998) (quoting Ball v. Metallurgic Hoboken-Overpelt, S.A., 902 F.2d 194, 199 (2d Cir.1990)) (internal citation omitted); Landoil Res. Corp. v. Alexander & Alexander Services, Inc., 918 F.2d 1039, 1043 (2d Cir.1990); Hoffritz for Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55, 57 (2d Cir.1985). In reviewing a motion to dismiss, the court assumes that plaintiff's factual allegations are true, construes pleadings and affidavits in the light most favorable to plaintiff and similarly resolves any doubts raised in favor of the plaintiff. See A.I. Trade Fin., Inc. v. Petra Bank, 989 F.2d 76, 79-80 (2d Cir. 1993); Hoffritz, 763 F.2d at 57.

B. CPLR § 302(a)(1)

Under CPLR § 302(a)(1), New York's long-arm statute,

a court may exercise personal jurisdiction over any non-domiciliary, or his executor or administrator, who in person or through an agent:

1. transacts any business within the state or contracts anywhere to supply goods or services in the state.... N.Y. C.P.L.R. 302(a)(1) (McKinney 2003). To establish personal jurisdiction under this provision, the plaintiff must demonstrate that the defendant engaged in a purposeful business transaction in or directed to New York and that such contacts...