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Sherles v. Fox

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

June 20, 2018

JOANN FOX, Defendant.


          Mary Alice Theiler United States Magistrate Judge


         Defendant JoAnn Fox moves to dismiss this matter under Federal Rule of Civil Procedure 12(b) due to lack of personal jurisdiction and improper venue. (Dkt. 21.) Defendant alternatively requests transfer to the United States District Court, Southern District of New York. Plaintiff objects to defendant's motion and requests that the Court sua sponte grant summary judgment on one issue and leave only the issue of damages for trial. (Dkt. 23.) Defendant opposes summary judgment. (Dkt. 25.) The Court herein finds no basis to dismiss or transfer, or to consider summary judgment at this juncture.


         Ann Rule, an author of true crime books and a Washington resident, died on July 26, 2015. At the time of her death, Rule's copyrights passed to her probate estate, including fifty-four registered copyrighted works, a number of which remain in print and are sold under license to major publishing houses. (See Dkt. 1, ¶5.) Plaintiff Machell Sherles is the Successor Executor and Trustee in the Estate of Ann Rule (“Rule Estate”), a Washington probate case.

         Joan Foley, doing business as The Foley Agency (or “agency”) and acting through an oral agreement, served as Rule's literary agent for more than thirty years. Foley and her agency negotiated publishing and other projects on Rule's behalf. The publishing agreements are in and signed with Rule's name, list The Foley Agency as her agent, and direct all monies due the author to be paid to the agency at 34 East 38th Street, Apt. 1B, New York, New York 10016 (hereinafter the “38th Street Apt.”). (See, e.g., Dkt. 22, Exs. 4-8.) Foley deducted a ten percent agency fee and sent the remaining ninety percent of royalties to “Rule Enterprises, Inc.”, a Washington Corporation. After Rule's death, Foley was expected to send the ninety percent to the Rule Estate.

         Foley died on March 30, 2016. The probate proceedings filed in the Foley Probate Estate reflect her domicile as the 38th Street Apt. (Dkt. 23, Ex. A.) However, while she lived and did business at the 38th Street Apt. for many years, Foley resided in Florida at the time of her death. The Foley Agency is not identified as an asset of the Foley Probate Estate. (Id. at 3.)

         Defendant JoAnn Fox is a resident of Florida. Fox met Foley in 2005 and became her landlord in 2007, when Fox purchased the 38th Street Apt. (Dkt. 18, Ex. D.) Fox asserts she became a literary agent and partner in The Foley Agency in 2015, after the death of Foley's husband, and signed a partnership agreement to that effect, and became the sole owner of the agency upon Foley's death. (Dkt. 22, ¶¶2-3, 6.) The agency and/or Fox continued to receive royalty payments after the deaths of Rule and Foley. (See, e.g., Dkt. 1, Ex. C and Dkt. 23, Ex. E.)

         Plaintiff filed suit in January 2018, seeking a declaratory judgment that any agency agreement terminated on the death of Rule; damages under the Lanham Act for misrepresentation of fact as to an agency relationship; damages under the Washington Consumer Protection Act; and for an accounting of royalties received from publishers after Rule's death. (Dkt. 1.) Plaintiff named Fox as the president of the agency in the complaint and, while noting the absence of any documentation of a partnership between Foley and Fox, accepts Fox's assertion as to her ownership of the agency for the purpose of responding to the motion to dismiss.[1]

         Plaintiff avers that while the agency is de jure, its telephone number has been disconnected and Fox resides in Florida, and that the agency is no longer an operating, de facto, entity and no longer performing any functions as a literary agent. (Id., ¶12.) Plaintiff further avers the publishers subject to agreements with Rule are now withholding payment of all or some of the royalties due based on the conflict between the Rule Estate and Fox. (Id., ¶13 and Ex. C.) The Estate has engaged new literary agents. (Id., ¶15.)


         Defendant moves to dismiss based on an absence of personal jurisdiction and improper venue, or to transfer venue. Plaintiff argues defendant's motion should be denied and summary judgment granted, sua sponte, on the issue of the termination of the oral agency agreement between Rule and Foley, leaving only the issue of damages for trial. A. Personal Jurisdiction Plaintiff bears the burden of establishing personal jurisdiction over defendant. Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218, 1223 (9th Cir. 2011). Where, as here, the Court resolves the motion on written materials, rather than holding an evidentiary hearing, plaintiff “need only make a prima facie showing of jurisdictional facts to withstand the motion to dismiss.” Id. Accord Farmers Ins. Exch. v. Portage La Prairie Mut. Ins. Co., 907 F.2d 911, 912 (9th Cir. 1990). “‘That is, the plaintiff need only demonstrate facts that if true would support jurisdiction over the defendant.'” Doe v. Unocal Corp., 248 F.3d 915, 922 (9th Cir. 2001) (quoting Ballard v. Savage, 65 F.3d 1495, 1498 (9th Cir. 1995)). Although plaintiff may not rely solely on the bare allegations in the complaint, uncontroverted allegations must be taken as true. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800-01 (9th Cir. 2004). Any factual disputes are resolved in plaintiff's favor. Id. Accord Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1154 (9th Cir. 2006).

         The exercise of personal jurisdiction over a nonresident defendant requires both the satisfaction of the requirements of the forum state's long-arm statute, and the requirements of federal due process. Chan v. Society Expeditions, 39 F.3d 1398, 1404-05 (9th Cir. 1994). Washington's long-arm statute confers personal jurisdiction to the extent due process allows. Id. at 1405. Because Washington's long-arm jurisdictional statute is coextensive with federal due process requirements, the jurisdictional analysis under state law and federal due process are the same. Schwarzenegger, 374 F.3d at 800-01. Accord IP Innovation, L.L.C. v. RealNetworks, Inc., 310 F.Supp.2d 1209, 1212 (W.D. Wash. 2004) (citing, inter alia, Chan, 39 F.3d at 1405 and Wash. Rev. Code § 4.28.185). Satisfaction of due process occurs when a nonresident defendant has “certain minimum contacts with [the forum] such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.” Helicopteros Nacionales de Columbia, S.A. v. Hall, 466 U.S. 408, 414 (1984) (internal quotation marks and quoted sources omitted). Personal jurisdiction may be either general or specific. Bancroft & Masters, Inc. v. Augusta Nat'l Inc., 223 F.3d 1082, 1086 (9th Cir. 2000), holding modified on other grounds as explained in Yahoo! Inc. v. La Ligue Contre Le Racisme, 433 F.3d 1199, 1206-07 (9th Cir. 2006).

         Defendant denies the existence of either general or specific personal jurisdiction, while plaintiff asserts no need to address general jurisdiction given that specific jurisdiction exists. The Court finds it prudent to begin with an assessment of specific jurisdiction.

         Specific jurisdiction requires a showing the nonresident defendant purposefully established significant contacts with the forum state, and that the cause of action arises out of or is related to the defendant's forum contacts. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 471-73 (1985).

         In the Ninth Circuit, courts analyze specific jurisdiction under a three-part test

(1) The non-resident defendant must purposefully direct his activities or consummate some transaction with the forum or resident thereof; or perform some act by which he purposefully avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws; (2) the claim must be one which arises out of or relates to the defendant's forum-related activities; and (3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e. it must be reasonable.

Mavrix Photo, Inc., 647 F.3d at 1227-28 (cited sources omitted; emphasis retained). Plaintiff bears the burden of satisfying the first two steps and, if successful, the burden shifts to defendant to set forth a “‘compelling case' that the exercise of jurisdiction would not be reasonable.” Id. at 1228 (quoting Burger King Corp., 471 U.S. at 476-78).

         1. Purposeful Availment/Direction:

         The first prong in the specific jurisdiction analysis “may be satisfied by purposeful availment of the privilege of doing business in the forum; by purposeful direction of activities at the forum; or by some combination thereof.” Yahoo! Inc., 433 F.3d at 1206. Typically, courts consider purposeful availment in suits sounding primarily in contract, and purposeful direction in suits sounding primarily in tort. Schwarzenegger, 374 F.3d at 802. See also Boschetto v. Hansing, 539 F.3d 1011, 1016-19 (9th Cir. 2008); Sher v. Johnson, 911 F.2d 1357, 1362 (9th Cir. 1990).

         “A showing that a defendant purposefully availed himself of the privilege of doing business in a forum state typically consists of evidence of the defendant's actions in the forum, such as executing or performing a contract there.” Schwarzenegger, 374 F.3d at 802 (emphasis added). By taking such actions, a defendant “‘purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws[, ]'” id. (quoting Hansen v. Denckla, 357 U.S. 235, 253 (1958)), such that the defendant should reasonably anticipate being haled into court there, Harris Rutsky & Co. Ins. Svcs., Inc. v. Bell & Clements Ltd., 328 F.3d 1122, 1130 (9th Cir. 2003) (citing World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980)). This requirement “ensures that a nonresident defendant will not be haled into court based upon random, fortuitous, or attenuated contacts with the forum state.” Rio Props., Inc. v. Rio Int'l Interlink, 284 F.3d 1007, 1019 (9th Cir. 2002) (citing Burger King Corp., 471 U.S. at 475).

         “A showing that a defendant purposefully directed his conduct toward a forum state, by contrast, usually consists of evidence of the defendant's actions outside the forum state that are directed at the forum, such as the distribution in the forum state of goods originating elsewhere.” Schwarzenegger, 374 F.3d at 803 (emphasis added). Purposeful direction allows a defendant to be haled into the forum notwithstanding a lack of any physical contacts with the forum, and provides for “‘jurisdiction over a defendant whose only “contact” with the forum state is the “purposeful direction” of a foreign act having effect in the forum state.'” Core-Vent Corp. v. Nobel Indus. AB, 11 F.3d 1482, 1485 (9th Cir. 1993) (quoting Haisten v. Grass Valley Medical Reimbursement Fund, 784 F.2d 1392, 1397 (9th Cir. 1986)) (emphasis retained). In considering purposeful direction, courts in the Ninth Circuit apply a three-part “effects” test, based on the Supreme Court's decision in Calder v. Jones, 465 U.S. 783 (1984), and requiring ...

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