Rao v. Era Alaska Airlines

• Decision Date: 28 May 2014
• Docket Number: Case No. PWG–12–2534.
• Court: U.S. District Court — District of Maryland
• Parties: Vijai RAO, et al., Plaintiffs, v. ERA ALASKA AIRLINES, et al., Defendants.

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Vijai RAO, et al., Plaintiffs
v.
ERA ALASKA AIRLINES, et al., Defendants.

Case No. PWG–12–2534.

United States District Court, D. Maryland, Southern Division.

Signed May 28, 2014.

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Herb J. Malveaux, Law Office of Herbert Malveaux, Washington, DC, for Plaintiffs.

Stephen J. Marshall, Franklin and Prokopik PC, Baltimore, MD, for Defendants.

MEMORANDUM OPINION

PAUL W. GRIMM, District Judge.

Maryland Plaintiffs sue an Alaska-based airline and other Alaska Defendants for torts arising out of the loss of personal property on or shortly after a flight operated by Defendant airline. Defendants have moved to dismiss for lack of personal jurisdiction on the grounds that Plaintiffs' claims arise out of a flight within Alaska operated by an airline that transacts business only within Alaska. Plaintiffs respond by arguing that jurisdiction in Maryland is proper because Plaintiffs purchased the tickets for their intra-Alaska flight over the internet, which is sufficient to give Maryland personal jurisdiction over Defendants. Because I disagree with Plaintiffs, I find that Maryland cannot exercise personal jurisdiction over Defendants but that the interests of justice require me to transfer the case to the U.S. District Court for the District of Alaska.¹

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I. BACKGROUND

In their Complaint, Plaintiffs Vijai Rao and Sumathi Mathur allege that, on August 22, 2010, they boarded a flight operated by Defendant Era Alaska Airlines (“Era”) from Kodiak, Alaska to Anchorage, Alaska. Compl. ¶ 4.1, ECF No. 1. “Plaintiffs carried with them personal items in a carrying case [ (the “Case”) ] on board the airline operated by the Defendants including several items of valuable jewelry and cash. Plaintiff checked that these items were in their possession prior to boarding the airplane for the flight from Kodiak to Anchorage.” Id. ¶ 4.3. After arriving in Anchorage and debarking from the airplane on August 23, 2010, Plaintiffs determined that the Case was missing.² Id. ¶ 4.3.

Plaintiffs returned to the Anchorage airport “[d]uring the early morning hours of August 23, 2010,” searched the deplaning area, and asked for permission to search the airplane from which they had debarked (the “Plane”), but were refused. Id. ¶ 4.5. They were told that Era's employees would search the airplane but could not do so for several hours. Id. ¶ 4.6. After failing to find the property at the Anchorage airport, Plaintiff Rao informed Era that he would be returning to Kodiak to search the boarding area at the Kodiak airport. Id. ¶ 4.7. Shortly before Rao boarded his flight, Era informed him that its employees had recovered his property at the Kodiak airport and discouraged him from returning to Kodiak even though he wanted to go and confirm that the Case was not there; the airline did not produce Plaintiffs' property at that time. Id. ¶¶ 4.8–10. “To further discourage Mr. Rao from making the trip to Kodiak to conduct his search, Defendant ERA Alaska Airlines promised that the cost of the round trip ticket from Anchorage to Kodiak and back would be fully refunded by Defendant.” Id. ¶ 4.10. Based upon the Airline's assurances that the Case had been located, Rao did not return to Kodiak. Id. ¶ 4.11.³ The Airline later determined that it had not recovered the Case. Id. ¶ 4.13.

Plaintiffs “lodged a written complaint with Defendant” and filed a police report with the Anchorage airport police. Id. ¶¶ 4.15–16. Plaintiffs allege that they have “suffered anguish and humiliation due to the loss of valuable personal property,” id. ¶ 4.17, although Plaintiffs do not allege that the items in the Case were of a personal or sensitive nature, but only allege that they were of significant monetary value.

On August 23, 2012, Plaintiffs filed their six-count complaint in this Court against Era, Era president Bob Hadjukovich, and “XYZ Corporations 1–5; XYZ Partnerships 1–5; and Does 1–10,”⁴ alleging: (I) Negligence; (II) Breach of Implied Warranty;

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(III) Fraud; (IV)⁵ “Violation of Aviation Consumer Protection”; (V) Gross Negligence; and (VI) Punitive Damages. Compl. Defendants Era and Hadjukovich moved to dismiss for lack of personal jurisdiction on December 28, 2012, Defs.' First Mot. to Dismiss, ECF No. 5. In May 2013, I denied the motion without prejudice and allowed the parties to undertake limited discovery to determine “if Defendants have sufficient connection with the State of Maryland such that the Court has personal jurisdiction over Defendants.” Letter Order 1, ECF No. 8. The parties filed a proposed Discovery Plan on June 21, 2013, ECF No. 10.

On September 25, 2013, Plaintiffs filed a Motion for Leave to Amend the Complaint (“Pls.' Mot. to Am.”), ECF No. 17, stating that “[t]he period of limited discovery ... concluded on 23 September 2013.” Pls.' Mot. to Am. ¶ 5. Plaintiffs seek to amend the Complaint to include facts supporting personal jurisdiction in Maryland over the Defendants. Id. ¶ 6. The proposed amended complaint seeks to add new factual allegations, including that:

In Maryland, the Defendants utilize the online service Sabre, a Global Distribution System, which allows bookings, reservations, itineraries, and ticketing by travel agencies and individual customers. Sabre (Sabre Travel Network) is held by Sabre Holdings a travel technology company which includes Travelocity and Expedia and has an office in Bethesda, MD.

....

... In 2010, Plaintiffs reserved, booked, and paid for services offered by the Defendants using the internet travel siteexpedia.com “Expedia” in Maryland.

Redlined Am. Compl., Pls.' Mot. to Am. Ex., ECF No. 17–2. Defendants Era and Hadjukovich opposed the Motion to Amend, see Defs.' Resp. in Opp'n to Pls.' Mot. for Leave to Am. the Compl. (“Defs.' Am. Opp'n”), ECF No. 22, and Plaintiffs have replied, Pls.' Resp. to Defs.' Opp'n to Pl.'s Mot. for Leave to Am. Compl. (“Pls.' Am. Reply”), ECF No. 24.

In addition to opposing the motion to amend, Defendants have renewed their motion to dismiss this case for lack of personal jurisdiction. Defs.' Renewed Mot. to Dismiss for Lack of Personal Jurisdiction (“Defs.' Mot. to Dismiss”), ECF No. 21. Plaintiffs have opposed the motion, Pls.' Resp. to Defs.' Renewed Mot. to Dismiss for Lack of Personal Jurisdiction (“Pls.' Dismiss Opp'n”), ECF No. 23, and Defendants have replied, Defs.' Reply to Pls.' Opp'n to Defs.' Renewed Mot. to Dismiss for Lack of Personal Jurisdiction (“Defs.' Dismiss Reply”), ECF No. 26.

Both the motion for leave to amend and the motion to dismiss are ripe and now are before me. Having reviewed the filings, I find a hearing is not necessary. Loc. R. 105.6.

II. PERSONAL JURISDICTION

When a defendant challenges this Court's personal jurisdiction under Fed.R.Civ.P. 12(b)(2), the jurisdictional question “ ‘is to be resolved by the judge, with the burden on the plaintiff ultimately to prove grounds for jurisdiction by a preponderance of the evidence.’ ” Fyfe Co., LLC v. Structural Grp., LLC, No. CCB–13–176, 2013 WL 2370497, at *2 (D.Md. May 30, 2013) (quoting Carefirst of Md., Inc. v. Carefirst Pregnancy Ctrs., Inc., 334 F.3d 390, 396 (4th Cir.2003) ). If the Court considers the complaint, the parties' briefings, and accompanying affidavits but does not conduct an evidentiary hearing, then “ ‘the burden on the plaintiff is simply to

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make a prima facie showing of a sufficient jurisdictional basis in order to survive the jurisdictional challenge.’ ” In re Celotex Corp., 124 F.3d 619, 628 (4th Cir.1997) (quoting Combs v. Bakker, 886 F.2d 673, 676 (4th Cir.1989) ); see Consulting Eng'rs Corp. v. Geometric Ltd., 561 F.3d 273, 276 (4th Cir.2009). The Court “ ‘must construe all relevant pleading allegations in the light most favorable to the plaintiff, assume credibility, and draw the most favorable inferences for the existence of jurisdiction.’ ” Fyfe Co., 2013 WL 2370497, at *2 (quoting Mylan Labs., Inc. v. Akzo, N.V., 2 F.3d 56, 62 (4th Cir.1993) (citation and quotation marks omitted)). Yet, “the Court need not ‘credit conclusory allegations or draw farfetched inferences.’ ” Tharp v. Colao, No. WDQ–11–3202, 2012 WL 1999484, at *1 (D.Md. June 1, 2012) (quoting Masselli & Lane, PC v. Miller & Schuh, PA, No. 99–2440, 2000 WL 691100, at *1 (4th Cir. May 30, 2000) ).

Personal jurisdiction may be either general or specific. Tawney v. AC & R Insulation Co., Inc., No. WDQ–13–1194, 2013 WL 5887625, at *2 (D.Md. Oct. 30, 2013) ; see Metro. Reg'l Info. Sys., Inc. v. Am. Home Realty Network, Inc., 888 F.Supp.2d 691, 699 (D.Md.2012).

To exercise general jurisdiction over a defendant, the defendant's activities in the state must be “continuous and systematic.” See ALS Scan, Inc. v. Digital Serv. Consultants, Inc., 293 F.3d 707, 712 (4th Cir.2002). If the cause of action arises out of the defendant's minimum contacts with the forum, the court may exercise specific jurisdiction.... In determining whether the

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