World Wide Travel Inc. v. Travelmate United States, Inc.

Decision Date15 November 2013
Docket NumberCivil Action No. 13–1333 (JEB)
Citation6 F.Supp.3d 1
PartiesWorld Wide Travel Incorporated, et al., Plaintiffs, v. Travelmate US, Inc., et al., Defendants.
CourtU.S. District Court — District of Columbia

OPINION TEXT STARTS HERE

James M. Towarnicky, James M. Towarnicky, PLLC, Fairfax, VA, for Plaintiffs.

Juli Z. Haller, Bailey & Ehrenberg, PLLC, Washington, DC, for Defendants.

MEMORANDUM OPINION

JAMES E. BOASBERG United States District Judge

World Wide Travel Incorporated, a travel agency located in Washington, D.C., hired Travelmate US, Inc., a California advertising firm, to promote its business online. After a dispute over charges, World Wide Travel and its owners sued Travelmate and several of its employees in D.C. Superior Court. Defendants removed the case to this Court, and now Travelmate and its owner, Ritu Singla, have moved to dismiss, arguing that they are not subject to personal jurisdiction in this forum and that Plaintiffs have failed to state a cause of action against them. As the Court agrees with the former argument, it need not reach the latter. The only relevant contact that either Defendant has with the District of Columbia is that, after offering their services to World Wide Travel, they entered a contract with the company. This is not enough to permit the Court to exercise personal jurisdiction over them consistent with the Due Process Clause. The Court, accordingly, must grant Defendants' Motion.

I. Background

The relevant facts here are largely undisputed. In setting forth the background, the Court nonetheless resolves any factual discrepancies in favor of Plaintiffs. Usha and Laxmi Chand are the President and Vice–President/Secretary, as well as the sole shareholders, of World Wide Travel Incorporated, a travel agency located and incorporated in the District of Columbia. See Compl., ¶¶ 12–13; Opp., Exh. 7 (Declaration of Usha Chand), ¶ 3. WWT transacts business using an American Express credit card account opened by Usha Chand and for which she is personally liable. See Compl., ¶ 4. The Chands live in Virginia. See id., ¶ 3.

In 2004, a WWT employee arranged for the Chands to sponsor Ritu Singla, an Indian national, to move to the United States in order to work for WWT. See id., ¶¶ 15–17; Mot., Exh. 1 (Declaration of Ritu Singla), ¶ 4. Shortly after Singla arrived, however, she quit her job at WWT and left Washington for Texas, and then for California, where she resides today. See Singla Decl., ¶ 4. Little did the Chands know that their association with Singla had only just begun.

Five years later, in February 2009, the Chands told their employees that they were looking for help promoting WWT over the Internet. See Chand Decl., ¶ 11. Before long, Laxmi Chand was contacted by an agent of Travelmate US, Inc. (TMI), an online-advertising firm located and incorporated in California. See id., ¶ 12; Singla Decl., ¶ 6. The agent explained that TMI could advertise WWT as a “sponsored result” on Google's website and later sent a contract to WWT's D.C. office, which Mr. Chand executed. See Chand Decl., ¶¶ 13–14; Compl., ¶¶ 26–28. Over the course of the next several months, WWT communicated with TMI by emailing with a Project Manager known only as “Tanya.” See Compl., ¶ 36; Opp., Exh. 3 (Tanya Emails). Unbeknownst to the Chands, TMI was owned and operated by their erstwhile friend, Ritu Singla. See Singla Decl., ¶ 6; Chand Decl., ¶ 23.

WWT's contract with TMI provided that WWT would pay a monthly rate of $3,225 in exchange for TMI placing WWT as a first-page sponsored result when Google users queried specific “keyword” search terms. See Compl., ¶¶ 29–31; Compl., Exh. 1 (TMI Contract). But in

October and November of 2010, the Chands discovered that TMI had assessed monthly charges of $8,990 and $8,150 to WWT's American Express account. See Compl., ¶ 34. The Chands instructed TMI not to make any further charges on WWT's account until they received documentation for the charges, and in the meantime they notified American Express that those charges were in dispute. See id., ¶¶ 36–39.

TMI then submitted invoices for the charges, which revealed that it had never used a number of the agreed-upon keywords and that it had repeatedly overcharged WWT for the ones that it had used. See id., ¶¶ 41–56. Further investigation also revealed that starting around June 2009, TMI had begun charging WWT on a “per click” rather than a “keyword” basis, without consultation or approval from WWT. See id., ¶¶ 33, 68–69. Even the click-based invoices, however, could not explain the superfluous charges, since they vastly overestimated the number of clicks that WWT's advertisements had actually received. See id., ¶¶ 60–61.

Fed up, the Chands filed this lawsuit alleging claims of fraud, fraud in the inducement, and civil conspiracy against TMI and Singla, as well as against two individuals who they believe are involved with TMI's business, Tanya Doe and John Doe. See id., ¶¶ 8–9, 94–107. Alternatively, the Chands suggest that “Tanya” may have been a false identity that Singla assumed in order to do business with them. See id., ¶ 105. TMI and Singla have now moved to dismiss the Complaint for lack of personal jurisdiction and for failure to state a claim. Although Defendants deny the existence of John Doe,” seeMot. at 17, and Singla attests that she has never used the name “Tanya” as a pseudonym, see Singla Decl., ¶ 10, the Court may only address what is in front of it—namely, the Motion brought by TMI and Singla—and thus does not consider the propriety of the Does as Defendants.

II. Legal Standard

Because this case turns on personal jurisdiction, the Court will recite only the legal standard for the resolution of that issue. Under Federal Rule of Civil Procedure 12(b)(2), a defendant may move to dismiss a suit if the court lacks personal jurisdiction over him. The plaintiff bears the burden of establishing personal jurisdiction, FC Inv. Grp. LC v. IFX Mkts., Ltd., 529 F.3d 1087, 1091 (D.C.Cir.2008), and the requirements for personal jurisdiction “must be met as to each defendant.” Rush v. Savchuk, 444 U.S. 320, 332, 100 S.Ct. 571, 62 L.Ed.2d 516 (1980). In deciding whether the plaintiff has shown a factual basis for personal jurisdiction over a defendant, the court resolves factual discrepancies in favor of the plaintiff. SeeCrane v. N.Y. Zoological Soc'y, 894 F.2d 454, 456 (D.C.Cir.1990). When personal jurisdiction is challenged, “the district judge has considerable procedural leeway in choosing a methodology for deciding the motion.” 5B Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure § 1351 (3d ed.2004). The court may rest on the allegations in the pleadings, collect affidavits and other evidence, or even hold a hearing. See id.

III. Analysis

The Court will first analyze the personal jurisdiction question and will then briefly examine whether transfer of the case is warranted.

A. Personal Jurisdiction

Neither TMI nor Singla is a resident of the District of Columbia, and so the Court may only exercise personal jurisdiction over them if it is both empowered by D.C.'s long-arm statute and permitted by the Constitution's Due Process Clause. SeeUnited States v. Ferrara, 54 F.3d 825, 828 (D.C.Cir.1995); Daley v. Alpha Kappa Alpha Sorority, Inc., 26 A.3d 723, 727 (D.C.2011); see also Fed. R. Civ. P. 4(k)(1)(A). This requirement translates into a two-step inquiry: the Court “first examine[s] whether jurisdiction is applicable under the ... long-arm statute and then determine[s] whether a finding of jurisdiction satisfies the constitutional requirements of due process.” GTE New Media Services Inc. v. BellSouth Corp., 199 F.3d 1343, 1347 (D.C.Cir.2000).

The District of Columbia's long-arm statute provides several ways for a D.C. court to obtain personal jurisdiction over a non-resident defendant. SeeD.C. Code § 13–423. Plaintiffs invoke two of these bases here. First, they argue that the Court has “specific jurisdiction” over Defendants because they “transact[ed] business in the District of Columbia.” § 13–423(a)(1). Second, they contend that the Court also has specific jurisdiction over Defendants because they “cause[ed] tortious injury in the District of Columbia.” § 13–423(a)(3) & (4). As a third and independent ground for personal jurisdiction, Plaintiffs rely on D.C. Code § 13–334(a), which permits a court to exercise “general jurisdiction” over a non-resident defendant in certain circumstances.1

As explained below, the Court concludes that none of these three bases is sufficient for the simple reason that neither Defendant has the requisite “minimum contacts” with the District to permit the exercise of personal jurisdiction in this forum under the Due Process Clause. Because this conclusion does not rest on disputed issues of fact and does not require evidence beyond that submitted with the parties' briefs, the Court will decline Plaintiffs' request for a preliminary hearing and additional discovery on the matter. See Opp. at 14, 26–27.

1. Specific Jurisdiction

Specific jurisdiction permits a court to adjudicate those “issues deriving from, or connected with, the very controversy that establishes jurisdiction.” Goodyear Dunlop Tires Operations, S.A. v. Brown, –––U.S. ––––, 131 S.Ct. 2846, 2851, 180 L.Ed.2d 796 (2011). In other words, the case must arise from the defendant's contacts with the forum state. D.C.'s long-arm statute enumerates the kinds of contacts with the District that are sufficient to bring a non-resident defendant into a D.C. court, two of which are at issue here: “transacting any business in the District of Columbia and “causing tortious injury in the District of Columbia.” D.C. Code § 13–423(a)(1), (3), & (4). The Court will take each in turn.

a. Transacting Business

The “transacting business” provision of the D.C. long-arm statute has been given an “expansive interpretation” rendering it “coextensive with the due process clause.” Helmer v. Doletskaya, 393 F.3d 201, 205 (D.C.Cir.2004) (quot...

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