Toomey v. Dahl

• Citation: 63 F.Supp.3d 982
• Decision Date: 30 October 2014
• Docket Number: Case No. 14–cv–3249 JNE/TNL.
• Parties: Sherry TOOMEY, Plaintiff, v. Keith DAHL, Defendant.
• Court: U.S. District Court — District of Minnesota

63 F.Supp.3d 982

Sherry TOOMEY, Plaintiff

v.Keith DAHL, Defendant.

Case No. 14–cv–3249 JNE/TNL.

United States District Court, D. Minnesota.

Signed Oct. 30, 2014.

Rebecca J. Heltzer, Heltzer & Houghtaling, P.A., Saint Paul, MN, for Plaintiff.

Christopher W. Madel, Matthew J.M. Pelikan, Jennifer M. Robbins, Robins Kaplan Miller & Ciresi LLP, Minneapolis, MN, for Defendant.

ORDER

JOAN N. ERICKSEN, District Judge.

Plaintiff Sherry Toomey is a resident of Minnesota. Defendant Keith Dahl is a resident of Alaska. Plaintiff and Defendant were allegedly romantically and professionally involved from 2003 until 2014. Plaintiff filed a lawsuit in state court alleging misrepresentation, breach of fiduciary duty, breach of contract, promissory estoppel, unjust enrichment, and conversion. Plaintiff seeks damages and an order establishing a trust over Defendant's real property with a portion of the proceeds from the sale of that property distributed to Plaintiff. Defendant removed the action to this Court and filed a motion to transfer/change venue and a motion to dismiss for lack of personal jurisdiction and for failure to state a claim. This matter is before the Court on these motions.

For the reasons set forth below, this Court denies Defendant's motion to transfer/change venue, denies Defendant's motion to dismiss for lack of personal jurisdiction, and grants in part and denies in part Defendant's motion to dismiss for failure to state a claim.

BACKGROUND

The following facts are alleged in the complaint. In 2003, Toomey and Dahl began seeing each other romantically. On September 20, 2003, Dahl asked Toomey to marry him and gave her an engagement ring. Dahl asked Toomey to relocate from Minnesota to Hoquiam, Washington to help prepare Dahl's home for sale and to manage his business investments, which included real estate and timber. In December 2003, Toomey relocated to Hoquiam, Washington.

Dahl told Toomey “that she would financially benefit if she aided him in the management of” his investments. Complaint ¶¶ 54, 63. Dahl also “represented to Toomey that if she would advance funds to help him pay business expenses, she would financially benefit by either being reimbursed in full or sharing in the profits earned from” Dahl's investments. Complaint ¶ 38. Toomey, who had been a mortgage underwriter in Minnesota, began managing Dahl's business investments. Occasionally, Toomey advanced her own funds to cover taxes, utility payments, and credit card charges incurred by Dahl for his business investments.

Toomey moved back to Minnesota in May 2006, when Dahl began spending most of his time in Alaska. With Dahl's approval, she continued to manage his business investments from Minnesota. Dahl traveled to Minnesota to visit Toomey and to conduct business. Toomey also advanced funds for Dahl's expenses on at least one occasion while she was working for Dahl in Minnesota.

Dahl represented that he would pay Toomey at the conclusion of a trial in an unrelated matter in which he expected to receive money as part of a negotiated settlement. In January 2014, Toomey presented Dahl with an itemization of all the money she had advanced and demanded payment of $166,677.94. The trial in the unrelated matter concluded in January 2014, and Dahl did not compensate Toomey. Toomey filed this lawsuit in state court on July 2, 2014. Dahl removed the action to this Court, where Dahl filed a motion to transfer/change venue and a motion to dismiss.

DISCUSSION

I. Motion to Transfer Venue

Defendant maintains that venue is improper under 28 U.S.C. § 1391. Defendant moves to change venue from this Court to the United States District Court, District of Alaska under 28 U.S.C. § 1406(a). Alternatively, Defendant moves to change venue to Alaska under 28 U.S.C. § 1404(a).

A. Section 1391

Defendant first argues that venue is improper under section 1391. However, Supreme Court precedent and the body of law interpreting that precedent clearly establish that section 1391 does not apply to actions removed to federal court. Polizzi v. Cowles Magazines, Inc., 345 U.S. 663, 665–66, 73 S.Ct. 900, 97 L.Ed. 1331 (1953) (“Section 1391(a) limits the district in which an action may be ‘brought’ ” but an action is not “brought” in district court when it is “brought in a state court and removed to the District Court.”); Collin Cnty. v. Siemens Business Servs., Inc., 250 Fed.Appx. 45, 52 (5th Cir.2007) (“section 1441, and not section 1391, governs venue in removal cases”); Lundahl v. Public Storage Management, Inc., 62 Fed.Appx. 217, 218–19 (10th Cir.2003) (“removal venue is governed by [section] 1441(a)” and thus “dismissal based on § 1391(b) was improvidently granted”); Global Satellite Communication Co. v. Starmill U.K. Ltd., 378 F.3d 1269, 1271 (11th Cir.2004) (“Section 1441(a), and not the ordinary federal venue statute, 28 U.S.C. § 1391, governs venue in removed cases.”); Kerobo v. Southwestern Clean Fuels, Corp., 285 F.3d 531, 534 (6th Cir.2002) (“Venue in removed cases is governed solely by § 1441(a).”); PT United Can Co. Ltd. v. Crown Cork & Seal Co., Inc., 138 F.3d 65, 72 (2d Cir.1998) (“the removal statute, and not the ordinary venue statute, 28 U.S.C. § 1391, governs venue in removed cases”); Lambert v. Kysar, 983 F.2d 1110, 1113 n. 2 (1st Cir.1993) (“the venue of a removed action is not governed by § 1391, but by 28 U.S.C. § 1441(a) ”); see also 14D Wright & Miller, Federal Practice and Procedure: Jurisdiction, § 3806 (“The general venue statute, Section 1391, does not apply in actions removed to federal court from state court.”).

Because this action was removed from state court, section 1391 does not apply.

B. Section 1406 and Personal Jurisdiction

Sections 1406 and 1404, which govern the transfer of venue, apply to actions removed to federal court. 28 U.S.C. § 1390(c) (“This chapter shall not determine the district court to which a civil action pending in a State court may be removed, but shall govern the transfer of an action so removed as between districts and divisions of the United States district courts.”). Section 1406(a) states that the “district court of a district in which is filed a case laying venue in the wrong division or district shall dismiss, or if it be in the interest of justice, transfer such case to any district or division in which it could have been brought.” 28 U.S.C. § 1406(a). Defendant argues that venue is improper under section 1406(a) because this Court lacks personal jurisdiction over Defendant and that, in the interests of justice, this Court should transfer the action to Alaska, where proper venue and personal jurisdiction exist. See Thompson v. Ecological Science Corp., 421 F.2d 467, 470 n. 4 (8th Cir.1970) (“Even if personal jurisdiction had not been obtainable in Arkansas, a transfer under 28 U.S.C. § 1406 might have been a preferable alternative to dismissal.”); see also Goldlawr, Inc. v. Heiman, 369 U.S. 463, 466, 82 S.Ct. 913, 8 L.Ed.2d 39 (1962) (holding that section 1406(a) grants district courts the power to transfer cases for lack of personal jurisdiction as well as for improper venue).

To establish personal jurisdiction, Plaintiff must provide “sufficient facts ... to support a reasonable inference that the defendant [ ] can be subjected to jurisdiction within the state.” Dairy Farmers of Am., Inc. v. Bassett & Walker Int'l, Inc., 702 F.3d 472, 474 (8th Cir.2012) (citations omitted). Plaintiff's showing “must be tested, not by the pleadings alone, but by the affidavits and exhibits presented with the motions and in opposition thereto.” Id. at 474 n. 3 (citations omitted). The Court must “look at the facts in the light most favorable to the nonmoving party, and resolve all factual conflicts in favor of that party.” Pangaea, Inc. v. Flying Burrito LLC, 647 F.3d 741, 745 (8th Cir.2011) (citation omitted). Plaintiff must show that Minnesota's long-arm statute has been satisfied and that exercising jurisdiction would comport with the Due Process Clause of the Fourteenth Amendment. See Guinness Import Co. v. Mark VII Distribs., Inc., 153 F.3d 607, 613 (8th Cir.1998). These two inquiries become one because Minnesota's long-arm statute extends jurisdiction to the outer limits of the Due Process Clause. See Guinness, 153 F.3d at 614. Due process requires that Defendant have sufficient “minimum contacts with [Minnesota] such that maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.’ ” Daimler AG v. Bauman, ––– U.S. ––––, 134 S.Ct. 746, 754, 187 L.Ed.2d 624 (2014) (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945) ).

Plaintiff can establish personal jurisdiction by showing either general personal jurisdiction or specific personal jurisdiction over Defendant. “Specific jurisdiction is jurisdiction over causes of action arising from or related to the defendant's actions in the forum state.” Wessels, Arnold & Henderson v. National Medical Waste, Inc., 65 F.3d 1427, 1432 n. 4 (8th Cir.1995). “General jurisdiction refers to the power of a state to adjudicate any cause of action regardless of where the cause of action arose.” Id. General jurisdiction “requires affiliations so continuous and systematic as to render [the defendant] essentially at home in the forum state.” Daimler AG, 134 S.Ct. at 758 n. 11 (quoting Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. ––––, 131 S.Ct. 2846, 2851, 180 L.Ed.2d 796 (2011) ) (internal quotation marks omitted). “For an individual, the paradigm forum for the exercise of general jurisdiction is the individual's domicile.”Goodyear, 131 S.Ct. at 2853–54. Whether a forum state may assert specific personal jurisdiction over a nonresident defendant depends on “the relationship among the defendant, the forum, and the litigation.” Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 775, 104 S.Ct. 1473, 79 L.Ed.2d 790 (1984) (quoting Shaffer v. Heitner, 433 U.S. 186, 204, 97 S.Ct. 2569, 53 L.Ed.2d 683 (1977) ). The “defendant's...