Stars for Art Prod. FZ, LLC v. Dandana, LLC, Civil Action No. 10–10629–JLT.
| Decision Date | 22 August 2011 |
| Docket Number | Civil Action No. 10–10629–JLT. |
| Citation | 806 F.Supp.2d 437 |
| Parties | STARS FOR ART PRODUCTION FZ, LLC, Plaintiff, v. DANDANA, LLC, et al., Defendants. |
| Court | U.S. District Court — District of Massachusetts |
OPINION TEXT STARTS HERE
Chesley Oriel, Framingham, MA, Eric Shwartz, Shapiro & Hender, Malden, MA, for Plaintiff.
William F. Spallina, Kathleen M. Curry, Boston, MA, for Defendants.
An Egyptian corporation, Stars for Art Production FZ LLC (“Plaintiff”), owns a music channel, originally entitled “Zoom” and later replaced with “Mazzika.” Plaintiff entered into a contract with a New Jersey corporation, Dandana, LLC (“Dandana”). The contract provided Dandana a license to broadcast that music channel and the channel was transmitted into Massachusetts through the services of Dish DBS Corporation (“Dish DBS”), Dish Network Corporation (“Dish Network”), and Dish Network LLC (“Dish LLC”) (collectively “Dish” or “the Dish Defendants”), which are all predominately based in Colorado.
Plaintiff sued both Dandana and Dish (collectively “Defendants”), primarily alleging that Dandana failed to pay certain fees owed under Plaintiff's and Dandana's contract.1 Defendants, however, contend that this court lacks personal jurisdiction over Defendants and that venue is improper. Presently at issue are Defendants' Motion to Dismiss Amended Complaint [# 25] and Plaintiff's Motion for Leave to Conduct Jurisdictional Discovery with Statement of Reasons [# 30]. For the following reasons, Defendants' Motion to Dismiss is ALLOWED IN PART and DENIED IN PART, and Plaintiff's Motion for Leave to Conduct Jurisdictional Discovery is DENIED WITHOUT PREJUDICE.
II. Background 2
Plaintiff, a United Arab Emirates LLC with its principal place of business there,3 owns the music television channels “Zoom” and “Mazzika.” 4 Dish Network, a Nevada corporation with a principal place of business in Colorado,5 provides, via satellite transmission, television channels to its subscribers.6 Dish Network is the parent company of Dish DBS, which is the parent company of Dish LLC.7 Dish DBS and Dish LLC are both organized under the laws of Colorado and have their principal places of business in Colorado.8 The other Defendant, Dandana, provides Dish Network with certain television channels for Dish Network to broadcast to Dish Network's subscribers.9 Dandana owns or has the licensing rights to broadcast those channels on the Dish Network.10
Around March 9, 2005, Plaintiff entered into a written agreement with Dandana (“2005 Agreement”).11 In the 2005 Agreement, Dandana acquired the exclusive licensing rights to broadcast the “Zoom” channel in the United States (the “License”).12 In consideration for the License, Dandana promised and agreed to pay Plaintiff $180,000 per year, in quarterly installments.13
Based on the 2005 Agreement, Dandana negotiated with Dish Network to have Dish Network broadcast the “Zoom” channel.14 In exchange, Dish Network agreed to pay Dandana an amount of money based on the number of subscribers that paid Dish Network for the right to view the “Zoom” channel.15
Dandana subsequently failed to honor the 2005 Agreement by not paying Plaintiff the money that Dandana owed.16 Around August 7, 2007, because of Dandana's failure to pay, Plaintiff sought to terminate the 2005 Agreement.17
On August 29, 2007, Dandana and Plaintiff instead modified the 2005 Agreement with an Addendum Agreement (“2007 Agreement”).18 As part of the 2007 Agreement, Dandana and Plaintiff agreed that either party “shall have the right to refer any dispute ... to the federal courts of the United States....” 19
Around January 19, 2009, Dandana and Plaintiff again amended the 2005 Agreement by substituting the “Mazzika” channel for the “Zoom” channel. 20
Dandana refused to pay Plaintiff money owed ($428,000) under the License. 21
On March 8, 2010, Plaintiff notified Dish Network of Dandana's breach and requested that Dish Network cease broadcasting the “Mazzika” channel or withhold payment to Dandana pending a resolution of the dispute between Plaintiff and Dandana.22 Dish Network did not comply with this request.23
Plaintiff brings six counts against Defendants here: (I) breach of contract against Dandana; (II) breach of implied covenant of good faith and fair dealing against Dandana; (III) unjust enrichment against Dandana; (IV) quantum meruit against Dandana; (V) fraud and misrepresentation against Dandana; and (VI) quantum meruit against Dish Network.24
In addition to the facts above, Plaintiff alleges the following facts to support the exercise of personal jurisdiction over Defendants:
Dish DBS is registered to do business in Massachusetts and all the Dish Defendants do business in the Commonwealth.25 Dish LLC provides satellite programming to residents of Massachusetts.26 Dish Network is the exclusive broadcaster of the “Mazzika” channel in Massachusetts.27
Dish maintains a website that reaches into Massachusetts. Specifically, people in Massachusetts can order Dish's products through Dish's website. 28 People also can communicate with Dish's representatives through a “realtime interactive chat.” 29
Defendants promote, market, and sell to Massachusetts subscribers the right to view television programs that are transmitted to Dish Network by Dandana. 30 Dish airs television advertisements in Massachusetts that direct people to its website and advertise Dish's services.31 Dish solicits customers in Massachusetts through its website and customer representatives. 32 Dish, on its website, also solicits employment applications for positions in Massachusetts.33
Dish Network has at least four locations in Massachusetts.34 Dish employs various individuals at these locations, including perhaps individuals engaged in servicing subscribers.35
Dish also has over 70,000 customers in Massachusetts.36 As of December 2009, Dish had a total of 14 million customers.37
Dandana, as part of the 2007 Agreement, agreed to a general forum selection clause allowing any dispute to be submitted to the federal courts in the United States.38
III. DiscussionA. Personal Jurisdiction Standard
A plaintiff “ ‘bears the burden of persuading [a] court that jurisdiction exists.’ ” 39 A plaintiff “ ‘may not rely on unsupported allegations in [the] pleadings, but [is] obliged to adduce evidence of specific facts' sufficient to justify the exercise of jurisdiction over the named defendants, including evidence outside the complaint.” 40 The court will also “ ‘add to the mix facts put forward by the defendants, to the extent that they are uncontradicted.’ ” 41
Personal jurisdiction exists if a federal court may exercise authority over a defendant on the basis of either specific or general jurisdiction.42 To establish specific jurisdiction, a plaintiff must show both that the Massachusetts long-arm statute 43 grants jurisdiction over the defendant and that “ ‘the exercise of jurisdiction under the statute is consistent with the [United States C]onstitution.’ ” 44 Specific jurisdiction exists only if “ ‘the cause of action arises directly out of, or relates to, the defendant's forum-based contracts.’ ” 45 To establish specific personal jurisdiction, a plaintiff must establish three elements: “relatedness,” “purposeful availment,” and “reasonableness.” 46
General jurisdiction, by contrast, “ ‘may be asserted in connection with suits not directly founded’ ” on a defendant's forum-based conduct.47 General jurisdiction exists if three requirements are met. First, a defendant must have sufficient contacts with the forum state.48 That is, the defendant must have engaged “in the ‘continuous and systematic’ pursuit of general business activities in the forum state.” 49 The standard for establishing general jurisdiction is also “ ‘considerably more stringent’ ” than the standard for specific jurisdiction.50 Second, these contacts must be purposeful.51 Third, “the exercise of jurisdiction must be ‘reasonable under the circumstances.’ ” 52 The reasonableness inquiry, the third test, is not a primary focus and involves consideration of the so-called “Gestalt factors.” 53 In assessing a claim for general jurisdiction, a court looks to factors such as instate ownership of property, “a license to do business within the state, the payment of state taxes, the instate presence of corporate offices, officers, and employees, contracts signed with states residents, and the volume of business regularly transacted and solicited in the forum state.” 54
B. The Dish Defendants
The Dish Defendants contend that this court lacks specific personal jurisdiction over them.55 Plaintiff does not disagree with Dish's argument. Plaintiff only argues that this court has general jurisdiction over Dish.56 This court therefore moves to the question of general jurisdiction.57
Plaintiff relies on various facts for this court to exercise general jurisdiction over Dish. First, Plaintiff points to Dish's solicitation of customers through its interactive web site and ongoing local television campaign.58 Second, Dish has sought the protection of Massachusetts' courts by bringing suit here. Third, Dish has four locations here and has listed employment positions at those locations.59 Finally, Dish is registered to do business in Massachusetts and has over 70,000 customers in Massachusetts.60
The First Circuit has instructed that, for the purposes of the general jurisdiction analysis, courts “ ‘consider all of a defendant's contacts with the forum state prior to the filing of the lawsuit.’ ” 61 This court will not play fast and loose with the First Circuit's teaching. This court will follow the doctrine literally.
Even though this court construes specific facts affirmatively alleged in P...
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