Rilley v. MoneyMutual, LLC

• Citation: 863 N.W.2d 789
• Decision Date: 18 May 2015
• Docket Number: No. A14–1307.,A14–1307.
• Parties: Scott RILLEY, et al., Respondents, v. MONEYMUTUAL, LLC, Appellant.
• Court: Court of Appeals of Minnesota

863 N.W.2d 789

Scott RILLEY, et al., Respondents
v.
MONEYMUTUAL, LLC, Appellant.

No. A14–1307.

Court of Appeals of Minnesota.

May 18, 2015.
Review Granted Aug. 11, 2015.

Daniel C. Bryden, E. Michelle Drake, Nichols Kaster, John G. Albanese, PLLP, Minneapolis, MN; and Mark Heaney, Heaney Law Firm, LLC, Minnetonka, MN, for respondents.

Joseph M. Windler, Christina Rieck Loukas, Winthrop & Weinstine, P.A., Minneapolis, MN; and Donald J. Putterman (pro hac vice), Putterman Logan, San Francisco, CA, for appellant.

Considered and decided by SMITH, Presiding Judge; RODENBERG, Judge; and CHUTICH, Judge.

OPINION

SMITH, Judge.

We affirm the district court's denial of appellant MoneyMutual's motion to dismiss because the respondents alleged sufficient minimum contacts to establish personal jurisdiction. The district court also did not abuse its discretion when it determined that the lenders were not indispensable parties.

FACTS

Appellant MoneyMutual, LLC, a Nevada corporation, operates a website that allows individuals to apply for short-term loans, commonly known as “payday loans.” Once an application is submitted, MoneyMutual offers the application to its lender network. After a lender selects the application, MoneyMutual notifies the applicant via e-mail and receives a fee from the lender. To promote its services, MoneyMutual advertises its website through television commercials. In addition, MoneyMutual e-mails marketing offers to people who have previously started or submitted a loan application.

Respondents, four Minnesota residents who used the MoneyMutual website to obtain loans, filed a class-action complaint against MoneyMutual. Respondents allege that MoneyMutual's website and advertising contained false and misleading

863 N.W.2d 792

statements, that MoneyMutual matched them with lenders that were unlicensed in Minnesota, and that their loans were illegal under Minnesota law. Respondents claim that MoneyMutual violated Minnesota's consumer-protection statutes, Minn.Stat. §§ 47.60, .601 (2014), 325D.44 (2014), 325F.67 (2014), 325F.69 (2014), breached its duty “not to engage in or facilitate ... illegal conduct,” unjustly enriched itself, participated in a civil conspiracy, and aided and abetted unlicensed lenders.

On April 28, 2014, MoneyMutual moved to dismiss the complaint for lack of personal jurisdiction and for failure to join indispensable parties. In response, respondents submitted additional evidence alleging that they submitted MoneyMutual applications with their Minnesota contact information from computers in Minnesota after seeing MoneyMutual advertisements in Minnesota. In addition, they submitted affidavits detailing MoneyMutual's advertising in Minnesota. The district court denied MoneyMutual's motion, concluding that “MoneyMutual has sufficient contacts with Minnesota” because of its advertising and regular communication with Minnesota loan applicants. The district court also concluded that the lenders were not indispensable parties because it could provide complete relief for the claims in their absence.

ISSUES

I. Did the district court err in concluding that MoneyMutual had sufficient contacts for personal jurisdiction in Minnesota?

II. Did the district court abuse its discretion in concluding that the lenders were not indispensable parties?

ANALYSIS

I.

MoneyMutual argues that the district court erred by denying its motion to dismiss for lack of personal jurisdiction. We review de novo whether personal jurisdiction exists. Volkman v. Hanover Invs., Inc., 843 N.W.2d 789, 794 (Minn.App.2014). To establish personal jurisdiction, the plaintiff must make a prima facie showing of jurisdiction, and the complaint and supporting evidence will be taken as true. Hardrives, Inc. v. City of LaCrosse, 307 Minn. 290, 293, 240 N.W.2d 814, 816 (Minn.1976). The court must view the evidence in the light most favorable to the plaintiff. Fastpath, Inc. v. Arbela Techs. Corp., 760 F.3d 816, 820 (8th Cir.2014). Doubts should be resolved in favor of retaining jurisdiction. Hardrives, 307 Minn. at 296, 240 N.W.2d at 818.

A Minnesota court may exercise personal jurisdiction over an out-of-state defendant as long as jurisdiction is authorized by the long-arm statute and comports with the constitutional due-process requirement. Juelich v. Yamazaki Mazak Optonics Corp., 682 N.W.2d 565, 570 (Minn.2004). Because Minnesota's long-arm statute extends to the limits of due process, see Minn.Stat. § 543.19, subd. 1 (2014), the inquiry turns on whether the defendant has sufficient minimum contacts with Minnesota so that exerting personal jurisdiction over the defendant “does not offend traditional notions of fair play and substantial justice,” Int'l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 158, 90 L.Ed. 95 (1945) (quotation omitted). Because our ultimate conclusion depends on the Due Process Clause of the United States Constitution, we apply federal caselaw in examining this issue. Valspar Corp. v. Lukken Color Corp., 495 N.W.2d 408, 411 (Minn.1992).

To exercise personal jurisdiction consistent with due process, the out-of-state defendant must have purposefully

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availed itself of the privilege of conducting activities within the forum state. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S.Ct. 2174, 2183, 85 L.Ed.2d 528 (1985). A court must focus “on the relationship among the defendant, the forum, and the litigation.” Griffis v. Luban, 646 N.W.2d 527, 532 (Minn.2002) (quotation omitted). To determine if minimum contacts exist, a court considers five factors: (1) the quantity of the defendant's contacts with Minnesota; (2) the nature and quality of the defendant's contacts with Minnesota; (3) the connection between the claims and the defendant's contacts; (4) Minnesota's interest in providing a forum; and (5) the convenience of the parties. Volkman, 843 N.W.2d at 795. The first three factors are given greater weight than the last two. Id.

The third factor determines which form of personal jurisdiction may exist. General jurisdiction exists when the defendant's contacts are “continuous and systematic,” so the forum may assert jurisdiction regardless of whether the claims are related to the contacts. Id. at 795. For specific jurisdiction to exist, the defendant must have “purposefully directed” its actions at the forum state, and the claims must “arise out of or relate to” the contacts. Burger King, 471 U.S. at 472, 105 S.Ct. at 2182 (quotations omitted). Respondents assert that specific jurisdiction exists here because MoneyMutual conducted business activities in Minnesota and their claims arise from those activities.

MoneyMutual argues that personal jurisdiction cannot be based on: (1) any contact it had with the respondents because those contacts are based on the “fortuitous” presence of the respondents in Minnesota; (2) its television commercials that aired in Minnesota because they were not targeted solely at Minnesota; or (3) its website, which is accessible from Minnesota, because it is not targeted solely at Minnesota. We agree that personal jurisdiction would not exist if we disregarded these items; however, we are not persuaded by MoneyMutual's contention that we must ignore the plethora of contacts alleged by respondents.

MoneyMutual first argues that the district court relied on the respondents' contacts with Minnesota, not its own. MoneyMutual contends that its contacts with Minnesota were limited to the respondents' “ ‘fortuitous' presence in the forum and ‘unilateral activities.’ ” MoneyMutual's argument appears to be that any contact involving a plaintiff cannot also be a contact of the...