St. Johns Vein Ctr., Inc. v. StreamlineMD LLC

• Decision Date: 28 September 2018
• Docket Number: Case No. 3:17-cv-892-J-34PDB
• Citation: 347 F.Supp.3d 1047
• Parties: ST. JOHNS VEIN CENTER, INC., a Florida C-Corporation, Plaintiff, v. STREAMLINEMD LLC, an Ohio Limited Liability Company, Sean M. Mullen, an Individual, Harry G. Curley, an Individual, and CVDJBA, LLC, an Arizona Limited Liability Company, Defendants.
• Court: U.S. District Court — Middle District of Florida

347 F.Supp.3d 1047

ST. JOHNS VEIN CENTER, INC., a Florida C-Corporation, Plaintiff,

v.STREAMLINEMD LLC, an Ohio Limited Liability Company, Sean M. Mullen, an Individual, Harry G. Curley, an Individual, and CVDJBA, LLC, an Arizona Limited Liability Company, Defendants.

Case No. 3:17-cv-892-J-34PDB

United States District Court, M.D. Florida, Jacksonville Division.

Signed September 28, 2018

Ashley A. Sawyer, Akerman LLP, Fort Lauderdale, FL, Cindy A. Laquidara, Allison M. Stocker, Akerman LLP, Jacksonville, FL, for Plaintiff.

Brett Gordon Mereness, Brian Jeffrey Aull, Cole, Scott & Kissane, PA, Jacksonville, FL, for Defendants.

ORDER

MARCIA MORALES HOWARD, United States District Judge

THIS CAUSE is before the Court on the Motion to Dismiss (Doc. 41, StreamlineMD Motion), filed on November 17, 2017, by Defendants StreamlineMD LLC, Sean M. Mullen, and Harry C. Curley (collectively the "StreamlineMD Defendants"). There, the StreamlineMD Defendants assert that several claims alleged by the Plaintiff, St. Johns Vein Center, Inc., (SJVC), in its Second Amended Complaint, see Doc. 27, Second Amended Complaint for Damages and Injunctive Relief (SA Complaint), filed October 18, 2017, should be dismissed for failure to state a claim upon which relief can be granted. See StreamlineMD Motion at 3. Also before the Court is Defendant CVDJBA, LLC's Motion to Dismiss (Doc. 42, CVDJBA Motion), filed on November 17, 2017, in which CVDJBA seeks dismissal of Count IV of the SA Complaint for lack of personal jurisdiction as well as for failure to state a claim upon which relief can be granted. See CVDJBA Motion at 8. Plaintiff opposes both motions. See St. Johns Vein Center, Inc.'s Response and Memorandum in Opposition to Defendants' Motion to Dismiss (Doc. 46, SJVC Response to StreamlineMD), and St. Johns Vein Center, Inc.'s Response and Memorandum of Law in Opposition to CVDJBA's Motion to Dismiss (Doc. 47, SJVC Response to CVDJBA), both filed December 15, 2017. With leave of Court, CVDJBA, LLC filed a reply to SJVC's Response to CVDJBA. See Defendant CVDJBA, LLC's Reply Memorandum in Support of Dispositive Motion to Dismiss (Doc. 51, CVDJBA's Reply), filed January 5, 2018. Accordingly, this matter is ripe for review.

I. STANDARD OF REVIEW

In ruling on a motion to dismiss, the Court must accept the factual allegations set forth in the complaint as true. See Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ; Swierkiewicz v. Sorema N.A., 534 U.S. 506, 508, n 1, 122 S.Ct. 992, 152 L.Ed.2d 1 (2002) ; see also Lotierzo v. Woman's World Med. Ctr., Inc., 278 F.3d 1180, 1182 (11th Cir. 2002). In addition, all reasonable inferences should be drawn in favor of the plaintiff. See Omar ex rel. Cannon v. Lindsey, 334 F.3d 1246, 1247 (11th Cir. 2003) (per curiam). Nonetheless, the plaintiff must still meet some minimal pleading requirements. Jackson v. BellSouth Telecomm., 372 F.3d 1250, 1262–63 (11th Cir. 2004) (citations omitted). Indeed, while "[s]pecific facts are not necessary," the complaint should " ‘give the defendant fair notice of what the ... claim is and the grounds upon which it rests.’ " Erickson v. Pardus, 551 U.S. 89, 93, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007) (per curiam) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). Further, the plaintiff must allege "enough facts to state a claim to relief that is plausible on its face." Twombly, 550 U.S. at 570, 127 S.Ct. 1955. "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678, 129 S.Ct. 1937 (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955 ). The "plaintiff's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Twombly, 550 U.S. at 555, 127 S.Ct. 1955 (citations omitted); see also BellSouth Telecomm., 372 F.3d at 1262 (explaining that "conclusory allegations, unwarranted deductions of facts or legal conclusions masquerading as facts will not prevent dismissal") (citations and quotations omitted). Indeed, "the tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions," which simply "are not entitled to [an] assumption of truth." See Iqbal, 556 U.S. at 679, 129 S.Ct. 1937. Thus, in ruling on a motion to dismiss, the Court must determine whether the complaint contains "sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ " Id. at 678, 129 S.Ct. 1937 (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955 ).

Additionally, in considering a motion to dismiss for lack of personal jurisdiction under Rule 12(b)(2), Federal Rule of Civil Procedure (Rule(s) ), the "plaintiff seeking the exercise of personal jurisdiction over a nonresident defendant bears the initial burden of alleging in the complaint sufficient facts to make out a prima facie case of jurisdiction." See United Techs. Corp. v. Mazer, 556 F.3d 1260, 1274 (11th Cir. 2009). Where a defendant "challenges jurisdiction by submitting affidavit evidence in support of its position, ‘the burden traditionally shifts back to the plaintiff to produce evidence supporting jurisdiction.’ " See id. (quoting Meier ex rel. Meier v. Sun Int'l Hotels, Ltd., 288 F.3d 1264, 1269 (11th Cir. 2002) ). In ruling on a motion to dismiss for lack of personal jurisdiction, a district court has discretion to conduct an evidentiary hearing. See Delong Equip. Co. v. Wash. Mills Abrasive Co., 840 F.2d 843, 845 (11th Cir. 1988). However, where the court does not conduct a hearing, "the plaintiff must present only a prima facie showing of ... personal jurisdiction." Id.

A plaintiff makes a prima facie showing by presenting evidence sufficient to withstand a motion for directed verdict on the issue of personal jurisdiction. Morris v. SSE, Inc., 843 F.2d 489, 492 (11th Cir. 1988). Thus, "[t]he district court must construe the allegations in the complaint as true, to the extent they are uncontroverted by defendant's affidavits[,]" and "where the evidence presented by the parties' affidavits ... conflicts, the court must construe all reasonable inferences in favor of the non-movant plaintiff." Id. (citing Delong Equip. Co., 840 F.2d at 845 ); see also United Techs. Corp., 556 F.3d at 1274 (citing Polski Linie Oceaniczne v. Seasafe Transp. A/S, 795 F.2d 968, 972 (11th Cir. 1986) ) (noting that, if the defendant rebuts the jurisdictional allegations in the plaintiff's complaint, "the plaintiff is required to substantiate [its] jurisdictional allegations [ ] by affidavits or other competent proof, and not merely reiterate the factual allegations in the complaint."). This construction in favor of the plaintiff is particularly necessary where, as in the instant case, the jurisdictional questions are intertwined with the merits of a case. See Delong Equip. Co., 840 F.2d at 845.

In accordance with this legal framework, the Court will summarize the facts alleged in the SJVC's SA Complaint, along with the relevant competing evidence put forth by CVDJBA as to the question of personal jurisdiction, all the while construing the alleged facts and evidence in favor of the non-moving plaintiff. Morris, 843 F.2d at 492.¹

II. BACKGROUND²

This controversy arises out of negotiations between the parties to this action to enter into a business venture that was never fully actualized. Plaintiff, SJVC, asserts that in the course of the parties' negotiations for the new business venture, Defendants, by virtue of a computer information management system, unlawfully gained access to SJVC's trade secrets, and ultimately used that protected information to exclude SJVC from the venture, and to compete against it.

SJVC is a Florida corporation with its principal place of business in Jacksonville, FL. SA Complaint at ¶ 1. Its business focuses on "diagnosing and treating vein conditions" and it is "one of only six Intersocietal Accreditation Commission-accredited vein centers in the State of Florida, and the only one in Northeast Florida for superficial venous evaluation and treatment." Id. at ¶ 10-11. In June of 2011, SJVC entered into a Service Agreement with StreamlineMD, an Ohio corporation that "offers cloud-based, clinical workflow and revenue cycle management technology and services tailored to meet the specific needs of" medical specialists like SJVC. Id. at ¶¶ 2, 12, 14.³ More specifically, StreamlineMD "provides physicians with a license to use its cloud-based integrated software platform to upload a physician's financial and performance data, which the physician can then use to generate reports and other documents on practice management, revenue cycle management, and billing in order to enhance his or her practice." Id. at ¶ 13.

Pursuant to the terms of the Service Agreement between SJVC and StreamlineMD, SJVC paid StreamlineMD a recurring fee for "a license to use Streamline MD's software and access StreamlineMD's database and information management systems." Id. at ¶ 14. SJVC used StreamlineMD's system for all aspects of its practice, except for patient billing. Id. at ¶ 16. Thus SJVC "used the software and services to generate reports containing significant confidential data and trade secret information belonging to [SJVC], including without limitation, the following: confidential patient information, procedures per month, finances (including reimbursement), insurance payment schedules, and patient demographics (collectively, the ‘Protected Information.’)." Id. The Service Agreement also granted StreamlineMD a license to "use only a few specific types of [SJVC's] data housed within StreamlineMD's software: aggregate, de-identified portions of [SJVC's] data for use only in the design, evaluation and operation of...