Pritz v. S. Cal. Edison Co.
| Decision Date | 26 July 2013 |
| Docket Number | Case No. 13-10884 |
| Parties | JEFFREY PRITZ, Plaintiff, v. SOUTHERN CALIFORNIA EDISON COMPANY, Defendant. |
| Court | United States District Courts. 6th Circuit. United States District Court (Eastern District of Michigan) |
HON. TERRENCE G. BERG
Jeffrey Pritz ("Plaintiff") has sued Defendant Southern California Edison Company ("SCE" or "Defendant"), alleging negligent and willful violations of the Fair Credit Reporting Act ("FCRA"), 15 U.S.C. §1681 et seq. Specifically, Plaintiff claims that he contacted Equifax to dispute the validity of a debt reported as unpaid, that Equifax then contacted SCE to verify the debt, and that SCE thereafter failed to conduct a proper reinvestigation, as required by 15 U.S.C. 1681s-2(b), and failed to direct all of the credit reporting agencies to remove the debt.
In response, Defendant has moved to dismiss the complaint for lack of personal jurisdiction (Dkt. 11), arguing that this Court has neither general, nor limited jurisdiction in this case. This motion was fully briefed and the Court heard oral argument on July 22, 2013. For the reasons that follow, Defendant's motion is GRANTED, and the case is DISMISSED WITHOUT PREJUDICE.
In 2005, according to the record before the Court, Plaintiff resided in Altadena, California, and was then a customer receiving electric service from Defendant (Dkt. 11, Def.'s Mot., Ex. 1, Liivoja Decl., ¶ 3). Sometime thereafter, Plaintiff relocated to Michigan.1
Plaintiff eventually became aware that Equifax was reporting what he believed to be a "bogus trade line" on his credit report (Dkt. 1, Compl., ¶ 6).2 Plaintiff then sent Equifax a letter disputing the validity of the debt . Equifax next transmitted the substance of Plaintiff's dispute to Defendant and Defendant responded by verifying that an account in Plaintiff's name was delinquent in the amount of $206 dollars.3 Equifax then sent Plaintiff the following message:
> >> We have researched the credit account. Account#- 26811* The results are: We verified that this item belongs to you. This creditor has verified to OUR company that the balance is being reported correctly. If you have additional questions about this item please contact: Southern California Edison, PO Box 9004, San Dimas CA 91773-9004.
(Dkt 14, Ex. B, Equifax Resp. to Dispute Letter) (capitalization in original). Plaintiff subsequently filed suit, alleging that SCE's actions violated the federal Fair Credit Reporting Act.4
On a motion to dismiss for lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(2), the plaintiff has the burden of proving the court's jurisdiction over the defendant. See Neogen Corp. v. Neo Gen Screening, Inc., 282 F.3d 883, 887 (6th Cir. 2002); see also Children's Legal Services, PLLC v. Shor Levin and Derita, PC, 850 F. Supp. 2d 673, 679 (E.D. Mich. 2012). "[I]n the face of a properly supported motion for dismissal, the plaintiff may not stand on his pleadings but must, by affidavit or otherwise, set forth specific facts showing that the court has jurisdiction." Children's Legal Servs., 850 F. Supp. 2d at 679 (citing Theunissen v. Matthews, 935 F.2d 1454, 1458 (6th Cir. 1991)). However, "the burden of the plaintiff is relatively slight, and the plaintiff must make only a prima facie showing that personal jurisdiction exists in order to defeat dismissal." Children's Legal Servs., 850 F. Supp. 2d at 679 (quoting Air Prods. & Controls, Inc. v. Safetech Int'l, Inc., 503 F.3d 544, 549 (6th Cir. 2007) (internal quotations and citations omitted).
Moreover, when a "district court rules on a jurisdictional motion to dismiss made pursuant to Federal Rule of Civil Procedure 12(b)(2) without conducting anevidentiary hearing, the court must consider the pleadings and affidavits in a light most favorable to the plaintiff." CompuServe, Inc. v. Patterson, 89 F.3d 1257, 1262-63 (6th Cir. 1996) (emphasis in original) (quoting Theunissen, 935 F.2d at 1459). "Dismissal in this procedural posture is proper only if all the specific facts which [Plaintiff] alleges collectively fail to state a prima facie case for jurisdiction." Id.
Where the Court's subject matter jurisdiction is based on a federal question, as in this case, personal jurisdiction over a defendant is proper only where it comports with the requirements of both the state long-arm statute and federal Constitutional due process. See Bird v. Parsons, 289 F.3d 865, 871 (6th Cir. 2002); see also Mich. Coalition of Radioactive Material Users, Inc. v. Griepentrog, 954 F.2d 1174, 1176 (6th Cir. 1992). In Michigan, personal jurisdiction over a corporation may be general, see MCL § 600.711, or limited, see MCL § 600.715. That being said, "[t]he Michigan Supreme Court has construed Michigan's Long-Arm Statute to bestow the broadest possible grant of personal jurisdiction consistent with due process." Audi AG and Volkswagen of America, Inc. v. D'Amato, 341 F. Supp. 2d 734, 741 (E.D. Mich. 2004). Likewise, the Sixth Circuit has held that "[w]here the state long-arm statute extends to the limits of the due process clause, the two inquiries are merged and the court need only determine whether exercising personal jurisdiction violates constitutional due process." Children's Legal Servs., 850 F. Supp. 2d at 679 (quoting Bridgeport Music, Inc. v. Still N The Water Publ'g, 327 F.3d 472, 477 (6th Cir. 2003)).
"General jurisdiction is proper only where 'a defendant's contacts with the forum state are of such a continuous and systematic nature that the state may exercise personal jurisdiction over the defendant even if the action is unrelated to the defendant's contacts with the state.'" Bird, 289 F.3d at 873 (quoting Third Nat'l Bank v. Wedge Grp., Inc., 882 F.2d 1087, 1089 (6th Cir. 1989)). Under Michigan law—and consistent with due process—a corporate defendant is also subject to general personal jurisdiction if it is incorporated in Michigan or consents to jurisdiction here. MCL § 600.711.
Perhaps because Defendant is a California corporation that has not consented to jurisdiction and does not engage in any business in Michigan, Plaintiff has not challenged Defendant's assertions that it is not subject to general personal jurisdiction. The Court, similarly, finds no basis for the exercise of general personal jurisdiction over SCE.
Under Michigan law, certain conduct within the state will subject a corporation to limited personal jurisdiction. See MCL § 600.715. Here, Plaintiff contends that Defendant's reporting of the alleged debt on Plaintiff's credit report had a negative effect on his credit rating, thus giving rise to a cause of action under the FCRA and thereby falling under Section 600.715(2) of Michigan's Long-Arm Statute (Dkt. 14, Pl. Resp. 2). As stated previously though, the fundamentalquestion is whether the exercise of jurisdiction comports with Constitutional due process. See Griepentrog, 954 F.2d at 1176.
In general, the exercise of limited personal jurisdiction over an out-of-state defendant is proper where the defendant has "certain minimum contacts with [the forum] such that maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.'" Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (quoting Milliken v. Meyer, 311 U.S. 457, 463 (1940)); accord Theunissen v. Matthews, 935 F.2d 1454, 1459-61 (6th Cir. 1991). Minimum-contacts are satisfied where a defendant has "purposely avail[ed] itself of the privilege of conducting activities within the forum State." Hanson v. Denckla, 357 U.S. 235, 253 (1958). The defendant's conduct must be such that he should reasonably anticipate being haled into court. See World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980).
The Sixth Circuit has established a three-part test for determining when the due process clause has been satisfied:
First, the defendant must purposefully avail himself of the privilege of acting in the forum state or causing a consequence in the forum state. Second, the cause of action must arise from the defendant's activities there. Finally, the acts of the defendant or consequences caused by the defendant must have a substantial enough connection with the forum state to make the exercise of jurisdiction over the defendant reasonable.
Southern Machine Co. v. Mohasco Industries, Inc., 401 F.2d 374, 381 (6th Cir. 1968). All three prongs are necessary for due process, and a plaintiff's "failure to meet anyone of the three means that personal jurisdiction may not be invoked." LAK, Inc. v. Deer Creek Enterprises, 885 F.2d 1293, 1303 (6th Cir. 1989).
The Sixth Circuit "views the purposeful availment prong of the Southern Machine test as 'essential' to a finding of personal jurisdiction." Intera Corp. v. Henderson, 428 F.3d 605, 616 (6th Cir. 2005) (citing Calphalon Corp. v. Rowlette, 228 F.3d 718, 722 (6th Cir. 2000)). "'Purposeful availment,' the 'constitutional touchstone' of personal jurisdiction, is present where the defendant's contacts with the forum state 'proximately result from actions by the defendant himself that create a 'substantial connection' with the forum State.'" Neogen, 282 F.3d at 889 (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985) (emphasis in original)). The purposeful availment requirement "ensures that a defendant will not be haled into a jurisdiction solely as a result of random, fortuitous, or attenuated contacts, or of the unilateral activity of another party or a third person." Burger King, 471 U.S. at 475 (1985) (internal quotations and citations omitted).
Plaintiff asserts that Defendant's verification of the debt to Equifax is sufficient to constitute purposeful availment. But that verification went from Defendant in California to Equifax in Georgia,...
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