Rissman Hendricks & Oliverio, LLP v. MIV Therapeutics Inc.

• Decision Date: 28 September 2012
• Docket Number: C.A. No. 11–10791–MLW.
• Citation: 901 F.Supp.2d 255
• Court: U.S. District Court — District of Massachusetts
• Parties: RISSMAN HENDRICKS & OLIVERIO, LLP f.k.a. Rissman Josbe Hendricks & Oliverio, LLP f.k.a. Kudirka & Jobse, LLP, Plaintiff, v. MIV THERAPEUTICS INC., MIV Scientific Holdings, Ltd., Biosync Scientific PVT, Alan P. Lindsay a.k.a. Alan Lindsay, Patrick McGowan, and Chris Xunan Chen a.k.a. Chris Chen, Defendants.

901 F.Supp.2d 255

RISSMAN HENDRICKS & OLIVERIO, LLP f.k.a. Rissman Josbe Hendricks & Oliverio, LLP f.k.a. Kudirka & Jobse, LLP, Plaintiff,

v.MIV THERAPEUTICS INC., MIV Scientific Holdings, Ltd., Biosync Scientific PVT, Alan P. Lindsay a.k.a. Alan Lindsay, Patrick McGowan, and Chris Xunan Chen a.k.a. Chris Chen, Defendants.

C.A. No. 11–10791–MLW.

United States District Court, D. Massachusetts.

Sept. 28, 2012.

Michael Lawrence Oliverio, Boston, MA, Alan M. Cohen, Law Offices of Alan M. Cohen, Framingham, MA, for Plaintiff.

Charles R. Bennett, Jr., Ryan E. Ferch, Murphy & King, PC, Boston, MA, for Defendants.

MEMORANDUM AND ORDER

WOLF, District Judge.

I. INTRODUCTION

This is an action brought by plaintiff Rissman, Hendricks, & Oliverio, LLP (“Rissman”) against defendants MIV Therapeutics, Inc. (“MIV”), MIV Scientific Holdings Ltd., Biosync Scientific PVT, Alan P. Lindsay, Patrick McGowan, and Chris Xunan Chen. Rissman, a Massachusetts law firm, alleges that defendants owe it $416,309.00 for legal services provided to MIV between May 29, 2008 and February 7, 2011.

The case was originally brought in the Superior Court of the Commonwealth of Massachusetts. It was removed to the United States District Court on May 5, 2011. Plaintiff's Complaint asserted a variety of state law claims against the defendants, including breach of contract, fraud, unjust enrichment, breach of the covenant of good faith and fair dealing, intentional misrepresentation, negligent misrepresentation, and violation of the Massachusetts Consumer Protection Act, Mass.G.L. c. 93A, as well as violations of several federal statutes.

In December 2011, separate and final default judgments in the amount of $542,575.17, including principal and interest, were entered against four of the defendants: MIV, MIV Scientific Holdings, Biosync Scientific PVT, and Chen (collectively, the “defaulted defendants”). Plaintiff dismissed all remaining claims against these defendants except for two counts seeking injunctive relief to prevent the defaulted defendants from liquidating a variety of assets until the default judgments were paid. Plaintiff also dismissed all claims against defendant McGowan.

Lindsay, a former corporate officer and member of the board of directors of MIV, has filed a Motion to Dismiss pursuant to Federal Rules of Civil Procedure 12(b)(2) and (5) (the “Motion”). Lindsay contends that the court lacks personal jurisdiction over him both under the Massachusetts long-arm statute, Mass.G.L. c. 223A, § 3, and the requirements of Due Process Clause of the United States Constitution. He also asserts that he was not properly served with process by the plaintiff. For the reasons set forth in this Memorandum and Order, the Motion is being denied.

II. LEGAL STANDARDA. Prima Facie Standard.

Once a defense of lack of personal jurisdiction has been raised, the plaintiff has the burden of showing that the court has personal jurisdiction over the defendant. See Adams v. Adams, 601 F.3d 1, 4 (1st Cir.2010); Daynard v. Ness, Motley, Loadholt, Richardson & Poole, P.A., 290 F.3d 42, 50 (1st Cir.2002); Newman v. European Aeronautic Defence & Space Co. Eads N.V., 700 F.Supp.2d 156, 159 (D.Mass.2010).

District courts in the First Circuit may require a plaintiff to satisfy one of three standards in establishing that personal jurisdiction exists: a prima facie showing of facts essential to establishing jurisdiction; a likelihood of the existence of each fact necessary to support personal jurisdiction; or a preponderance-of-the-evidence standard. SeeFoster–Miller, Inc. v. Babcock & Wilcox Canada, 46 F.3d 138, 145–46 (1st Cir.1995); Boit v. Gar–Tec Products, Inc., 967 F.2d 671, 674–78 (1st Cir.1992); see also Adelson v. Hananel, 510 F.3d 43, 48 (1st Cir.2007). The prima facie standard is the most commonly used and is appropriate where a case does not involve materially conflicting versions of the facts. See Foster–Miller, 46 F.3d at 145–46;see also Adelson, 510 F.3d at 48. Under the prima facie standard, the district court considers “only whether the plaintiff has proffered evidence that, if credited, is enough to support findings of all facts essential to personal jurisdiction.” Boit, 967 F.2d at 675. The court does not act as fact-finder and instead adduces “the facts from the pleadings and the parties' supplementary filings, including affidavits, taking facts affirmatively alleged by plaintiff as true and construing disputed facts in the light most hospitable to plaintiff.” Ticketmaster–New York, Inc. v. Alioto, 26 F.3d 201, 203 (1st Cir.1994); see also Sawtelle v. Farrell, 70 F.3d 1381, 1385–87 (1st Cir.1995); Boit, 967 F.2d at 675.

As defendant agrees, the prima facie standard is appropriate in the instant case. There is conflicting evidence, but the record is not so rife with contradictions that a standard higher than prima facie should apply. See General Contracting & Trading Co. v. Interpole, Inc., 899 F.2d 109, 115 (1st Cir.1990); see also Landmark Bank v. Machera, 736 F.Supp. 375, 380 n. 7 (D.Mass.1990). Accordingly, the court is utilizing the prima facie standard. See Daynard, 290 F.3d at 51.

Under the prima facie standard, “to establish personal jurisdiction [a] plaintiff must go beyond the pleadings and make affirmative proof.” Chlebda v. H.E. Fortna & Bro., Inc., 609 F.2d 1022, 1024 (1st Cir.1979). Such an affirmative showing must be based on documents and affidavits. They must indicate that the defendant is subject to the jurisdiction of the court under the long-arm statute of the state in which the court sits, as “a federal court exercising diversity jurisdiction ‘is the functional equivalent of a state court sitting in the forum state.’ ” Sawtelle, 70 F.3d at 1387 (quoting Ticketmaster–New York, 26 F.3d at 204). The court must also determine whether exercising jurisdiction comports with the Fourteenth Amendment's Due Process Clause. See id.

B. Long–Arm Statute and Due Process

Because Lindsay is not alleged to have been a resident of Massachusetts, to own property here, or to have otherwise consented to this court's jurisdiction, personal jurisdiction is only appropriate if the defendant falls within the Massachusetts long-arm statute, Mass.G.L. c. 223A, § 3, and exercising jurisdiction comports with the requirements of the Due Process Clause. See Evans Cabinet Corp. v. Kitchen Int'l, Inc., 593 F.3d 135, 146 (1st Cir.2010); Nowak v. Tak How Inv., Ltd., 94 F.3d 708, 712 (1st Cir.1996); Newman, 700 F.Supp.2d at 162–63.

The Massachusetts long-arm statute provides that a “court may exercise personal jurisdiction over a person, who acts directly or by an agent, as to a cause of action in law or equity arising from the person's ... transacting any business in this commonwealth[.]” Mass. G.L. c. 223A, § 3(a). “For jurisdiction to exist under Section 3(a), the facts must satisfy two requirements-the defendant must have transacted business in Massachusetts, and the plaintiff's claim must have arisen from the transaction of business by the defendant.” Tatro v. Manor Care, Inc., 416 Mass. 763, 767, 625 N.E.2d 549 (1994) (citing Good Hope Indus., Inc. v. Ryder Scott Co., 378 Mass. 1, 10 n. 17, 389 N.E.2d 76 (1979)). “[G]enerally the purposeful and successful solicitation of business from residents of the Commonwealth, by a defendant or its agent, will suffice to satisfy this requirement.” Id. at 767, 625 N.E.2d 549. The defendant need not have had any physical presence in Massachusetts. See Energy Capital & Services LP, II v. Hill Refrigeration, Inc., 989 F.Supp. 353, 355 (D.Mass.1997); Burger King Corp. v. Rudzewicz, 471 U.S. 462, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985) (jurisdiction “may not be avoided merely because the defendant did not physically enter the forum State”); see also Tatro, 416 Mass. at 768, 625 N.E.2d 549.Section 3(a) also “does not require that the business transacted have taken place within the physical bounds of the commonwealth[.]” Bond Leather Co. v. Q.T. Shoe Mfg. Co., 764 F.2d 928, 932 (1st Cir.1985) (citing Good Hope Indus., 378 Mass. at 10, 389 N.E.2d 76).

Because the Massachusetts Supreme Judicial Court has interpreted the state's long-arm statute to extend to the limits permitted by the United States Constitution, the court “may sidestep the statutory inquiry and proceed directly to the constitutional analysis.” Evans Cabinet Corp., 593 F.3d at 146 (quoting Daynard, 290 F.3d at 52);Newman, 700 F.Supp.2d at 163. The “transacting business” requirement of the Massachusetts long-arm statute thus merges with the constitutional due process analysis. See Cambridge Literary Props., Ltd. v. W. Goebel Porzellanfabrik G.m.b.H., 295 F.3d 59, 63 (1st Cir.2002).

The Due Process Clause requires that the defendant have sufficient “minimum contacts” with a forum so that subjecting him to that forum's jurisdiction will not offend the “traditional notions of fair play and substantial justice.” United Elec. Workers v. 163 Pleasant St. Corp., 960 F.2d 1080, 1087 (1st Cir.1992) “(Pleasant Street I ”) (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945)). Under the “minimum contacts” analysis, the two recognized types of personal jurisdiction are “general” and “specific” jurisdiction:

General jurisdiction exists when the litigation is not directly founded on the defendant's forum-based contacts, but the defendant has nevertheless engaged in continuous and systematic activity, unrelated to the suit, in the forum state.... Specific personal jurisdiction may be asserted where the cause of action arises directly out of, or relates to, the defendant's forum-based contacts.

Id. at 1088–89. It is undisputed that the court does not have general jurisdiction over Lindsay.

There are three distinct inquiries necessary to establish specific personal jurisdiction:

First, the claim underlying the litigation must directly arise out of, or relate to, the defendant's forum-state activities. Second, the defendant's in-state...