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DNA Contractors, Inc. v. Ahmed

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

July 17, 2018

DNA CONTRACTORS, INC., a Washington company, Plaintiff,
AMIR AHMED, an individual resident of Texas, Defendant.




         This matter comes before the Court on Defendant's Motion to Dismiss Pursuant to FRCP Rules 12(b)(2) and 12(b)(6), and Alternatively, Motion to Compel Arbitration. Dkt. #6. Defendant argues that he does not have minimum contacts with Washington and that this Court does not have personal jurisdiction over him, that Plaintiff fails to adequately allege either of its claims, and that Plaintiff should, in any event, be compelled to arbitrate its claims. Plaintiff opposes the Motion. Dkt. #9. For the reasons stated below, the Court finds that it does not have personal jurisdiction over Defendant and grants Defendant's Motion to Dismiss.

         II. BACKGROUND [[1]]

         Plaintiff initiated this action against Defendant in state court for: (1) “tortious interference with a business relationship” and (2) “conspiracy in restraint of trade, ” a violation of Washington's Consumer Protection Act (Chapter 19.86, Revised Code of Washington). Dkt. #1, Ex. A at ¶ 1. From August, 13, 2007, to June 30, 2015, Plaintiff had a contract with DISH Network LLC (“DISH”) to “sell [DISH] services on a nationwide basis.” Id. at ¶¶ 17, 24. Plaintiff competed with other entities contracting with DISH to sell DISH services. Id. at ¶ 14. Dish One Satellite LLC (“DishOne”), jointly owned by DISH and unknown individuals, is one such entity that contracts with DISH to sell DISH services on a nationwide basis. Id. at ¶¶ 11, 15-16. Plaintiff therefore competed with DishOne for customers. Id. at ¶ 18.

         Defendant is DISH's Senior Vice President of Sales and in that capacity oversees nationwide sales of DISH services. Id. at ¶¶ 19-20. Defendant's compensation includes a portion of the profits generated by DishOne's sales of DISH services. Id. at ¶ 21. Defendant, acting in his own financial interest, convinced DISH to cancel Plaintiff's contract in order to increase DishOne's profits and, accordingly, Defendant's compensation. Id. at ¶¶ 22-23.


         The Court will first address Defendant's argument that the Court lacks personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2). Where a defendant moves to dismiss a complaint for lack of personal jurisdiction, the plaintiff bears the burden of demonstrating that jurisdiction is appropriate. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004). Where, as here, the motion is based on written materials rather than an evidentiary hearing, the plaintiff's pleadings and any affidavits need only make a prima facie showing of facts supporting personal jurisdiction. Id. Any conflicts over jurisdictional facts must be resolved in the plaintiff's favor. Id.

         Pursuant to Federal Rule of Civil Procedure 4(k)(1)(A), federal courts ordinarily follow state law to determine their jurisdiction over persons. Daimler AG v. Bauman, 571 U.S. 117, 125 (2014). Washington's long-arm statute extends personal jurisdiction to the broadest reach that the United States Constitution permits. Byron Nelson Co. v. Orchard Management Corp., 95 Wash.App. 462, 975 P.2d 555, 558 (Wash.Ct.App. 1999). The Court therefore must determine whether the exercise of jurisdiction comports with federal constitutional requirements. See Easter v. Am. W. Fin., 381 F.3d 948, 960 (9th Cir. 2004).

         The Due Process Clause protects a defendant's liberty interest by only subjecting a defendant to binding judgements in forums with which the defendant has established “certain minimum contacts . . . such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.'” Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463 (1940)). Thus, in determining personal jurisdiction, courts focus “on the relationship among the defendant, the forum, and the litigation.” Shaffer v. Heitner, 433 U.S. 186, 204 (1977).

         Personal jurisdiction exists in two forms, general and specific. Dole Food Co. v. Watts, 303 F.3d 1104, 1111 (9th Cir. 2002). General jurisdiction exists over a non-resident defendant when there is “continuous and systematic general business contacts that approximate physical presence in the forum state.” Schwarzenegger, 374 F.3d at 801. Here, Plaintiff does not appear to argue, and the record does not support, that Defendant is subject to general jurisdiction in Washington. Dkt. #9 at 7-9. The Court, therefore, needs only to consider specific jurisdiction.

         To determine whether to exercise specific jurisdiction over a non-resident, the Ninth Circuit applies a three-prong 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 ...

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