Modern Gaming, Inc. v. Sockeye Software, LLC

• Decision Date: 11 January 2023
• Docket Number: Civil Action 22-00357-BAJ-SDJ
• Parties: MODERN GAMING, INC. v. SOCKEYE SOFTWARE, LLC, ET AL.
• Court: U.S. District Court — Middle District of Louisiana

MODERN GAMING, INC.
v.
SOCKEYE SOFTWARE, LLC, ET AL.

Civil Action No. 22-00357-BAJ-SDJ

United States District Court, M.D. Louisiana

January 11, 2023

RULING AND ORDER

BRIAN A. JACKSON, JUDGE

This contract dispute features three players in the video poker market- Plaintiff Modern Gaming, Inc., Defendant Sockeye Software, LLC (“Sockeye”), and Defendant Empire Technological Group, Ltd. (“Empire”). In sum, Plaintiff alleges that Sockeye and Empire hatched a scheme whereby Sockeye would unilaterally terminate its exclusive software Licensing Agreement with Plaintiff, and thereafter award essentially the same agreement to Empire (Plaintiff s competitor) under more favorable terms to Sockeye. Plaintiff insists that it lost valuable business opportunities in multiple states as a result of Defendants' scheme. (Doc. 1).

Now Sockeye and Empire each move to dismiss Plaintiffs Complaint. Empire challenges the merits of Plaintiffs action under Federal Rule of Civil Procedure (“Rule”) 12(b)(6), arguing that Plaintiffs allegations fail to state actionable claims of tortious interference with contract and conspiracy under Louisiana law. (Doc. 11). By contrast, Sockeye challenges personal jurisdiction under Rule 12(b)(2), insisting that the Licensing Agreement is its only “contact” with Louisiana, and that it would offend due process to require its appearance in this District. (Doc. 24).

In response, Plaintiff offers arguments seemingly at odds, undermining its own position against each Defendant. On one hand, Plaintiff insists that Empire's Rule

1

12(b)(6) challenge fails because Plaintiffs claims are governed by Colorado law-not Louisiana law-insofar as the “conduct occurred in Colorado,” and “there is no allegation, and no reason to conclude, that any of the wrongful conduct occurred in Louisiana.” (Doc. 12 at p. 3). On the other, Plaintiff opposes Sockeye's jurisdictional argument by asserting that, “without a doubt, Sockeye reached out beyond Colorado to create a continuing relationship and obligations with a citizen of Louisiana.” (Doc. 25 at p. 4).

Perhaps these arguments can be reconciled. At present, however, the Court need not square this circle because Plaintiffs Complaint plainly is deficient in its current form. As an initial matter, Plaintiff obviously falls short of establishing the Court's jurisdiction over Sockeye, a Colorado LLC whose only alleged connection to Louisiana is the Licensing Agreement with Plaintiff. The law is clear that the mere existence of a contract between a resident plaintiff and a non-resident defendant will not establish sufficient minimum contacts to confer personal jurisdiction. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 478 (1985) (“If the question is whether an individual's contract with an out-of-state party alone can automatically establish sufficient minimum contacts in the other party's home forum, we believe the answer clearly is that it cannot.”). This rule applies with particular force when, as alleged here, the contract envisions performance primarily in states other than Louisiana. See Jones v. Artists Rts. Enf't Corp., 789 Fed.Appx. 423, 426 (5th Cir. 2019) (plaintiff failed to establish...