Silver v. Brown

• Decision Date: 30 November 2009
• Docket Number: No. Civ. 09-0510 JB/ACT.,Civ. 09-0510 JB/ACT.
• Citation: 678 F. Supp.2d 1187
• Parties: David SILVER, Plaintiff, v. Matthew A. BROWN, Growth Technologies International, Inc. and Jack McMullen, Defendants.
• Court: U.S. District Court — District of New Mexico

678 F.Supp.2d 1187

David SILVER, Plaintiff, v. Matthew A. BROWN, Growth Technologies International, Inc. and Jack McMullen, Defendants.

No. Civ. 09-0510 JB/ACT.

United States District Court, D. New Mexico.

November 30, 2009.

David Silver, Espanola, NM, Plaintiff Pro Se.

Kristofer C. Knutson, Christopher M. Grimmer, Scheuer, Yost & Patterson, P.C., Santa Fe, NM, for the Defendants.

MEMORANDUM OPINION AND ORDER

JAMES O. BROWNING, District Judge.

THIS MATTER comes before the Court on (i) the Defendants' Motion to Dismiss for Lack of Personal Jurisdiction or, Alternatively to Transfer Venue, filed June 22, 2009 (Doc. 6); (ii) Plaintiff's Motion for Summary Judgment, filed July 13, 2009 (Doc. 11); (iii) Plaintiff's Writ of Precipae sic, filed August 4, 2009 (Doc. 17); (iv) Motion to Impose Sanctions on Defendants and Opposing Counsel, filed September 15, 2009 (Doc. 19); (v) Motion for Preliminary Injunction, filed September 24, 2009 (Doc. 22); and (vi) Motion to Add an Additional Defendant to the Complaint, filed September 22, 2009 (Doc. 23). The Court held a hearing on November 9, 2009. Plaintiff David Silver is representing himself pro se. The primary issues are: (i) whether the Defendants have been properly served with process; (ii) whether the Court has personal jurisdiction over the Defendants; (iii) whether the Plaintiff has standing; and (iv) whether Defendants and their counsel should be sanctioned for not agreeing to having the matter heard by a Magistrate Judge. The Defendants have not been properly served with process, and the Court does not have personal jurisdiction over the individual Defendants. Furthermore, Plaintiff does not have standing to bring the breach-of-contract claim, and he cannot represent his corporation Northern Hills, Inc., d/b/a Santa Fe Capital Group ("Santa Fe Capital Group"), and the Court will deny the claims against Defendant Growth Technologies International, Inc. ("GTI"). The Court will grant the motion to dismiss in part and deny it in part, and deny the motion for summary judgment, the writ of praecipe and the motion for sanctions. The Complaint will be dismissed without prejudice. The remaining motions will be denied as moot.

FACTUAL BACKGROUND

Silver is a resident of the state of New Mexico. See Complaint ¶ 1, at 1, filed May 26, 2009 (Doc. 1). Defendants Matthew A. Brown and Jack McMullen are citizens of the state of Florida. See id. ¶ 2, at 1. Defendant GTI is a corporation domiciled in the state of Florida. See id.

On December 16, 2008, Northern Hills, Inc., d/b/a Santa Fe Capital Group ("Santa Fe Capital Group"), and GTI entered into an Investment Banking Agreement ("Agreement") whereby Santa Fe Capital Group agreed to assist in raising angel capital¹ for GTI in exchange for three monthly payments of $1,250.00 and 100,000 shares of GTI common stock. See Complaint ¶¶ 6-7, at 2. GTI made the required payments to Santa Fe Capital Group. See id. ¶¶ 6-8, at 2. McMullen sent two of the payments.² Doc. 9 at 12-13. Despite repeated requests from Santa Fe Capital Group, GTI did not provide to Santa Fe Capital Group the 100,000 shares of GTI common stock or pay all of the expense reimbursements that the Agreement required. See Complaint ¶¶ 9-10, at 1. In furtherance of the Agreement, Silver wrote several versions of a Funding Memorandum³ for GTI, with GTI's input. See Complaint ¶ 12, at 2. In April 2009, Silver submitted the final version of the Funding Memorandum to investors to determine their interest in providing capital to GTI. See id. ¶ 13, at 2. The investors were not interested in funding GTI. See id. ¶ 14, at 3. Believing that Santa Fe Capital Group was not performing under the Agreement, the Defendants demanded Santa Fe Capital Group return $6,000.00. See Complaint ¶ 14, at 3. On or about May 5, 2009, the Defendants posted a blog on the internet entitled "A Special Report on David Silver and the Santa Fe Capital Group." Complaint ¶ 17, at 3. The blog contains untrue statements about Silver and Santa Fe Capital Group. See Complaint ¶ 17, at 3. One client of Santa Fe Capital Group terminated her contract after reading the blog. See Complaint ¶ 17, at 3. Silver asked the Defendants to remove the blog, but they refused. See Complaint ¶ 19, at 3. The blog allegedly injured Silver. See Complaint ¶ 17, at 3.

PROCEDURAL BACKGROUND

On May 26, 2009, Silver filed his Complaint. See Doc. 1. Silver alleges breach of contract (Count 1), wire fraud (Count 2), slander and defamation of character (Count 3), and duress (Count 4). See Complaint ¶¶ 21-28, at 4-5. On June 22, 2009, the Defendants filed Defendants' Motion to Dismiss for Lack of Personal Jurisdiction or, Alternatively to Transfer Venue (Doc. 6), and their Memorandum of Points and Authorities in Support of Defendants' Motion to Dismiss for Lack of Personal Jurisdiction or, Alternatively, to Transfer Venue (Doc. 7).

In their motion, the Defendants assert that dismissal is appropriate under rules 12(b)(2) and (3) of the Federal Rules of Civil Procedure and that transfer is appropriate under 28 U.S.C. § 1404(a). See Motion To Dismiss at 1. The Defendants contend that they are not subject to the Court's personal jurisdiction. See Motion to Dismiss at 1. In the alternative, the Defendants ask the Court to transfer the case to the United States District Court for the Southern District of Florida, Miami Division. See id. at 1.

In the memorandum, the Defendants assert that they do not have the minimum contacts with New Mexico required to provide personal jurisdiction or to support a finding of proper venue. See Memorandum at 1. The Defendants contend that McMullen did not execute the Agreement and was not a party to the Agreement. See id. at 2. They argue that the "fiduciary shield doctrine" protects Brown because Brown acted as representative of the corporation and not individually with regard to the Agreement. See Memorandum at 2.

The Defendants further contend that New Mexico's long-arm statute does not permit jurisdiction over them, and that their contacts with New Mexico are insufficient to support general jurisdiction or specific jurisdiction. See Memorandum at 3-5. The Defendants also assert that, even if they have the necessary minimum contacts with New Mexico, the exercise of personal jurisdiction would be unreasonable. See id. at 7-9. Additionally, the Defendants argue that Silver does not have standing to bring claims on behalf of Santa Fe Capital Group. See id. at 9. Lastly, the Defendants assert that the arbitration clause in the Agreement is binding upon the parties and, if the Court does not believe that it should dismiss the matter, suggest that the proper venue for this matter would be the Southern District of Florida, Miami Division. See Memorandum at 10-12.

On June 30, 2009, Silver filed his Response to Defendant's Motion to Dismiss or Alternatively to Transfer Venue and Plaintiffs Motion for Summary Judgment. See Doc. 9. Silver contends that the Defendants' motion was filed untimely, that the Defendants are in default for failure to timely file their answer, and that, therefore, Silver is entitled to summary judgment on his claims. See Response to Motion to Dismiss ¶ 6, at 3. Silver further asserts that New Mexico is the proper jurisdiction for this case as all events surrounding the claims occurred there. See Response to Motion to Dismiss ¶ 9, at 8.

On July 13, 2009, Silver filed Plaintiffs Motion for Summary Judgment (Doc. 11), asserting that the Defendants did not timely file their motion to dismiss or an answer and, that, therefore, the Court must grant him summary judgment. See Motion for SJ ¶¶ 4, 6, at 2. In answer to the motion, on July 27, 2009, the Defendants filed the Defendants' Response and Memorandum in Opposition to Plaintiffs Motion for Summary Judgment. See Doc. 14. The Defendants dispute some of the facts presented in Silver's motion, including the dates of service upon the Defendants and the contents of the subpoenas. See Response SJ ¶ 1-9, at 1-2. The Defendants further contend that their motion to dismiss was timely filed. See Response SJ at 4.

Also, on July 27, 2009, the Defendants filed the Defendants' Reply to Plaintiffs Response (Docket 5) to Defendants' Motion to Dismiss or Alternatively to Transfer Venue (Docket 2). See Doc. 15. The Defendants reiterated that the subpoenas do not conform to rule 4 as effective service and, accordingly, that Silver's argument regarding the timeliness of the Defendants' motion to dismiss fails. See Reply to Dismiss at 1. Specifically, the Defendants assert that the subpoenas do not contain the time within which the Defendants had to appear and to defend, and did not notify them that, as a result of their failure to appear and defend, a default judgment might result. See id. at 2. Further, the clerk did not sign the subpoenas and the subpoenas did not contain the court seal. The Defendants contend that they filed their motion within twenty days of being served by Silver. See Reply to Dismiss at 1.

The Defendants argue that Silver does not describe the minimum contacts that they have with the state of New Mexico which are necessary to confer personal jurisdiction and venue. See id. at 2. The Defendants assert that, even if jurisdiction and venue would be proper in New Mexico, the arbitration clause contained in the Agreement supports transfer of the matter to Florida. See Reply to Dismiss at 2.

The Defendants further contend that Silver did not address their argument that he lacks standing to pursue a breach-of-contract claim regarding the Agreement. See Reply to Dismiss at 2. They assert that Silver is in blatant disregard of the Court's rules which state that an attorney must represent a corporation. See Reply to Dismiss at 2. The Defendants argue that Silver's tort claims are included in the "any dispute" language of the arbitration clause, and, therefore, choice-of-venue provisions are applicable to them, too. Reply to Dismiss ...