Rocky Mountain Chipseal, LLC v. Sherman Cnty., Civil Case No. 11–cv–02131–LTB.

• Decision Date: 19 January 2012
• Docket Number: Civil Case No. 11–cv–02131–LTB.
• Citation: 841 F.Supp.2d 1224
• Parties: ROCKY MOUNTAIN CHIPSEAL, LLC, a Colorado limited liability company, Plaintiff, v. SHERMAN COUNTY, KANSAS, Defendant.
• Court: U.S. District Court — District of Colorado

841 F.Supp.2d 1224

ROCKY MOUNTAIN CHIPSEAL, LLC, a Colorado limited liability company, Plaintiff,

v.SHERMAN COUNTY, KANSAS, Defendant.

Civil Case No. 11–cv–02131–LTB.

United States District Court, D. Colorado.

Jan. 19, 2012.

John Aaron Atkinson, Atkinson Boyle, PLLC, Littleton, CO, for Plaintiff.

Edward Craig Stewart, Theresa R. Wardon, Wheeler Trigg O'Donnell, LLP, Denver, CO, for Defendant.

MEMORANDUM OPINION AND ORDER

BABCOCK, District Judge.

This matter is before me on the Motion to Dismiss [Doc. # 7] filed by Defendant Sherman County, Kansas (“Sherman”). Sherman moves pursuant to Fed.R.Civ.P. 12(b)(2) and 12(b)(3) to dismiss Plaintiff Rocky Mountain Chipseal, LLC's (“RMC”), complaint for lack of personal jurisdiction and improper venue. After consideration of the parties' arguments, and for the reasons stated below, I GRANT the portion of the motion seeking to dismiss RMC's complaint for lack of personal jurisdiction, and I DENY as moot the portion seeking dismissal for improper venue.

I. Background

RMC is a limited liability company incorporated under Colorado law and keeps its principal place of business in Colorado. Sherman is a Kansas county created by Kansas law.

On January 19, 2010, RMC provided Sherman with a proposed contract for RMC to perform chipsealing work for Sherman on a stretch of road in Sherman County, Kansas. Sherman, acting through the chairman of its board of county commissioners, executed the contract in Kansas and faxed it to RMC in Colorado on May 3 of that year. RMC completed the first phase of the work in September 2010 and left its equipment in Sherman County in order to complete the second and final phase of the project in May 2011.

On April 19, 2011, Sherman informed RMC that it no longer wanted RMC to complete the second phase of the project. In response, RMC filed suit in Colorado district court, asserting claims for breach of contract, unjust enrichment, and negligentmisrepresentation. Sherman removed the matter to this Court pursuant to 28 U.S.C. §§ 1441 and 1446, on grounds of diversity jurisdiction under 28 U.S.C. § 1332.

II. Discussion

A. Personal Jurisdiction

Sherman's first challenge is for want of personal jurisdiction. A judgment rendered by a court lacking jurisdiction is void. See, e.g., Burnham v. Superior Ct. of Cal., 495 U.S. 604, 608–09, 110 S.Ct. 2105, 109 L.Ed.2d 631 (1990). RMC bears the burden of establishing jurisdiction over Sherman. Behagen v. Amateur Basketball Ass'n of U.S.A., 744 F.2d 731, 733 (10th Cir.1984). “Prior to trial, however, when a motion to dismiss for lack of jurisdiction is decided on the basis of affidavits and other written materials, the plaintiff need only make a prima facie showing.” Id. My review of the motion takes the allegations in RMC's complaint as true to the extent that they are uncontroverted by Sherman's affidavit. See id. “If the parties present conflicting affidavits, all factual disputes are resolved in the plaintiff's favor, and the plaintiff's prima facie showing is sufficient notwithstanding the contrary presentation by the moving party.” Id.

“To obtain personal jurisdiction over a nonresident defendant in a diversity action, a plaintiff must show that jurisdiction is legitimate under the laws of the forum state and that the exercise of jurisdiction does not offend the due process clause of the Fourteenth Amendment.” Soma Med. Int'l v. Standard Chartered Bank, 196 F.3d 1292, 1295 (10th Cir.1999) (quoting Far West Capital, Inc. v. Towne, 46 F.3d 1071, 1074 (10th Cir.1995)). Hence, the first step in the analysis is examining Colorado's long-arm statute. That statute permits exercising jurisdiction over defendants who transact business in the state. Colo.Rev.Stat. § 13–1–124(1)(a). It is construed to grant personal jurisdiction to the full extent permitted under federal law. See Safari Outfitters, Inc. v. Superior Court, 167 Colo. 456, 448 P.2d 783, 784 (1968). The analysis therefore collapses into a single inquiry: whether exercising personal jurisdiction over Sherman comports with due process. See Found. for Knowledge in Dev. v. Interactive Design Consultants, LLC, 234 P.3d 673, 677–78 (Colo.2010)

Due Process “protects an individual's liberty interest in not being subject to binding judgments of a forum with which he has established no meaningful ‘contacts, ties, or relations.’ ” OMI Holdings, Inc. v. Royal Ins. Co. of Canada, 149 F.3d 1086, 1090 (10th Cir.1998) (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 471–72, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985)). “Therefore, a ‘court may exercise personal jurisdiction over a nonresident defendant only so long as there exist ‘minimum contacts' between the defendant and the forum state.’ ” Id. (quoting World–Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 291, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980)). “Minimum contacts” shields a defendant bereft of meaningful contacts with a state “from the burdens of defending a lawsuit far from home in a forum where the substantive and procedural laws may be quite different from those with which the litigant is familiar.” Id.

Minimum contacts is satisfied by specific or general jurisdiction. Id. Consistent with due process, I may assert specific jurisdiction over a nonresident defendant if it has “ ‘purposefully directed’ [its] activities at residents of the forum, and the litigation results from alleged injuries that ‘arise out of or relate to’ those activities.” Id. at 1090–91 (quoting Burger King, 471 U.S. at 472, 105 S.Ct. 2174). If specific jurisdiction is absent, I may nonetheless maintain general personal jurisdiction over Sherman “based on the [its] general business contacts with the forum state.” Id. at 1091 (citing Helicopteros Nacionales de Colombia v. Hall, 466 U.S. 408, 415, 104 S.Ct. 1868, 80 L.Ed.2d 404 (1984)). Because general jurisdiction is not related to the events giving rise to the suit, I impose a more stringent test requiring RMC to demonstrate that Sherman has “continuous and systematic general business contacts” with Colorado. Id.

Before assessing whether specific or general jurisdiction is present here, I address RMC's first argument for why this Court has personal jurisdiction over Sherman, which is that it personally served one of Sherman's commissioners, Cynthia Strnad, while she was in Colorado. Relying on Perkins v. Benguet Consol. Min. Co., 342 U.S. 437, 72 S.Ct. 413, 96 L.Ed. 485 (1952), RMC asserts that this conferred personal jurisdiction over Sherman.

It is indeed the case that where “service is made upon a natural person found within the state, the minimum contacts analysis in inapplicable.” O'Brien v. Eubanks, 701 P.2d 614, 616 (Colo.App.1984); accord Int'l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945) (“[D]ue process requires only that in order to subject a defendant to a judgment in personam, if he be not present within the territory of the forum, he have certain minimum contacts with it such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’ ”) (emphasis added). This is a function of the general rule that personal service upon someone present in the forum state confers jurisdiction over the person served. O'Brien, 701 P.2d at 616;accord Burnham, 495 U.S. at 619, 110 S.Ct. 2105 (“The short of the matter is that jurisdiction based on physical presence alone constitutes due process because it is one of the continuing traditions of our legal system that define the due process standard of ‘traditional notions of fair play and substantial justice.’ ”). That rule, however, does not ineluctably establish personal jurisdiction in the instant case because RMC must establish jurisdiction over Sherman—not Ms. Strnad. Plaintiff's argument thus rests on the tacit supposition that serving Ms. Strnad served Sherman, that Sherman was “present” in and through Ms. Strnad such that serving her effected service upon it. This is the issue I examine.

Because RMC fails to direct me to the law apposite to its position, I must unearth it with my own shovel, beginning with how a county must be served. Federal law provides that a county must be served by either “(A) delivering a copy of the summons and of the complaint to its chief executive officer; or (B) serving a copy of each in the manner prescribed by that state's law for serving a summons or like process on such a defendant.” Fed.R.Civ.P. 4(j)(2). Courts have interpreted “that state's law” in option (B) to mean the state where the government entity “is physically located and of which it is a citizen.” See, e.g., U.S. Steel Corp. v. Multistate Tax Comm'n, 367 F.Supp. 107, 118 (S.D.N.Y.1973) (interpreting “ ‘that state’ to mean the state where the Commission is physically located and of which it is a citizen: namely, Colorado.”), and Clark Cnty., Nev. v. City of Los Angeles, Cal., 92 F.Supp. 28, 31 (D.Nev.1950) (“The words ‘that state’ ... obviously refer to a state made a defendant in an action or to the state under the laws of which a municipal corporation defendant was chartered or brought into existence.”). Kansas law directs that a plaintiff must serve “one of the county commissioners, the county clerk or the county treasurer” to serve a county. Kan. Stat. Ann. § 60–304(d)(1). (I note that Colorado law also prescribes that a county may be served by serving one of its commissioners. SeeColo. R. Civ. P. 4(e)(7).) Stopping here would suggest that serving Ms. Strnad in Colorado vested this Court with jurisdiction over Sherman. But stopping here would be premature.

Sherman rejoins that Ms. Strnad was in Colorado for personal reasons—that is, when she was served, she was in Colorado on her own accord as a private citizen, not for any matters related to Sherman or her county commissionership. Neither RMC's complaint nor its response is inconsistent with this assertion. Ms. Strnad also lives in Kansas. See Def.'s Mot. Ex. A. at 2. As will be discussed in Part...