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Servant Ventures, Inc. v. Gazelles, Inc.

United States District Court, W.D. Washington, Tacoma

June 19, 2018

SERVANT VENTURES, INC., Plaintiff,
v.
GAZELLES, INC.; and GAZELLES FL, INC., Defendants.

          ORDER GRANTING DEFENDANTS' MOTION TO DISMISS

          BENJAMIN H. SETTLE UNITED STATES DISTRICT JUDGE

         This matter comes before the Court on Defendants Gazelles FL, Inc., and Gazelles, Inc.'s (“Gazelles”) motion to dismiss for lack of jurisdiction (Dkt. 22). The Court has considered the pleadings filed in support of and in opposition to the motion and the remainder of the file and hereby grants the motion for the reasons stated herein.

         I. PROCEDURAL HISTORY

         On April 6, 2018, Plaintiff Servant Ventures, Inc. (“SVI”), doing business as Gazelles International Coaches, filed a complaint against Gazelles in Clark County Superior Court for the State of Washington. Dkt. 1-1. SVI asserts causes of action for breach of contract, promissory estoppel, tortious interference with contract, and defamation. Id.

         On April 25, 2018, Gazelles removed the matter to this court. Dkt. 1.

         On May 3, 2018, the Court granted in part and denied in part SVI's motion for temporary restraining order. Dkt. 23.

         On May 2, 2018, Gazelles moved to dismiss for lack of jurisdiction. Dkt. 22. On May 21, 2018, SVI responded. Dkt. 31. On May 25, 2018, Gazelles replied. Dkt. 35.

         II. FACTUAL BACKGROUND

         Verne Harnish, the founder and CEO of Gazelles, is the author, creator, and owner of certain books, programs, and curriculums specializing in leadership, strategic planning, and growth for individuals and companies looking to succeed and scale up in the business world. Dkt. 1-4, ¶¶ 1, 4. Individuals pay a fee to be trained and certified in Mr. Harnish's methods and intellectual property with the goal of becoming a coach. Id. ¶ 4. Once an individual becomes a coach, he or she pays a membership fee for the opportunity to utilize and train others in Mr. Harnish's methods and intellectual property. Id. In 2001, Mr. Harnish created Gazelles International as a “division” of the Gazelles brand to focus on offering education and training to business coaches around the world. Dkt. 12-1, ¶ 2; id., Ex. A at 3.

         In approximately 2007, Mr. Harnish brought on Keith Cupp to operate the Gazelles International division. Dkt. 1-4, ¶ 5. Mr. Cupp asserts that he “took over the Gazelles International Coaches business from Mr. Ron Huntington.” Dkt. 32, ¶ 3. Mr. Huntington lived and worked in the Seattle, Washington area at that time and is currently an international coach residing in Seattle. Id., ¶ 4. Mr. Cupp resides in Vancouver, Washington, and has maintained his offices continuously in Vancouver, where the Gazelles International business records are maintained. Id. ¶ 9. Mr. Harnish declares that “Mr. Cupp's specific role in the Gazelles International division was to educate, train, and certify coaches based on the ideas and intellectual property created by Mr. Harnish.” Dkt. 1-4, ¶ 5.

         In 2010, Mr. Cupp formed SVI in Washington. Dkt. 1-1, ¶ 6. Prior to that, Mr. Cupp alleges that he operated SVI as a sole proprietorship. Id. ¶ 7. Mr. Harnish declares that he was unaware that Mr. Cupp formed SVI or operated Gazelles International as SVI doing business as Gazelles International. Dkt. 1-4, ¶ 6; Dkt. 12-1, ¶ 4.

         Regarding SVI's contracts with its coaches, Mr. Cupp enters into the contracts on behalf of SVI. Dkt. 17-1 at 1. Based on the face of the contract, and a review of the record before the Court, there is no evidence that Gazelles is a party to any SVI coach's contract. Mr. Cupp declares that seven Gazelles International coaches reside in Washington, and two other coaches reside in Portland, Oregon, marketing to and supporting Washington clients. Dkt. 32, ¶ 5. Mr. Harnish declares that Gazelles International contracts with approximately 250 coaches worldwide. Dkt. 1-4, ¶ 7.

         Regarding Gazelles' other contacts with Washington, Mr. Cupp declares that Gazelles has been involved in numerous events in Washington. Mr. Cupp cites eight “Scaling Up Workshops” held in Seattle and Portland, which advertised to and attracted individuals from Washington. Dkt. 32, ¶ 12. Mr. Cupp declares that these workshops involved extensive coordination and planning between Gazelles International and Gazelles. Id. ¶¶ 9-12. Gazelles received some of the profits from these workshops. Id. ¶ 15. Mr. Cupp also declares that he is in constant and regular communication with Gazelles' employees. Id. ¶¶ 10-11.

         Mr. Harnish declares that he has travelled to Washington “a handful of times to deliver speeches for a non-profit called Entrepreneurs Organization.” Dkt. 22-1, ¶ 2. Otherwise, he is unable to “recall conducting ...


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