United States District Court, M.D. North Carolina
MEMORANDUM OPINION AND ORDER
Catherine C. Eagles, District Judge.
Stuart has sued his former employers, Van Leeuwen Ice Cream
LLC and Churn LLC, contending they breached his employment
agreement and committed various torts and statutory
violations. The defendants seek dismissal based on lack of
personal jurisdiction. Because Mr. Stuart has made a prima
facie showing that (i) the defendants purposefully
availed themselves of the privilege of conducting activities
in the forum State, (ii) that Mr. Stuart's
claims arise out of those activities, and (iii) that
the exercise of personal jurisdiction would be
constitutionally reasonable, the motion will be denied. His
claims for breach of contract and fraud, which the defendants
do not otherwise challenge, will proceed. The Court will rule
on the motion to dismiss Mr. Stuart's other claims for
failure to state a claim by separate order issued as time
Background and Overview
Stuart alleges that Van Leeuwen's previous corporate
iteration, Churn, hired him on July 12, 2017, under the terms
of an employment agreement attached to his complaint.
See Doc. 2 at ¶¶ 3-5; Doc.
Under this contract, Mr. Stuart was entitled to certain
benefits when he reached one year of employment on July 12,
2018. Doc. 2 at ¶¶ 7-8. Van Leeuwen has refused to
provide him these benefits. Id. at ¶¶
10-14. He claims Van Leeuwen's actions constitute breach
of contract, fraud, unjust enrichment, breach of fiduciary
duty, and unfair and deceptive trade practices in violation
of North Carolina law. Id. at ¶¶ 15-61.
Stuart filed his complaint in state court in February 2019
against Van Leeuwen and Churn. Doc. 2 at 1. Van Leeuwen
removed the case to federal court based on diversity of
citizenship, see Doc. 1, and now moves to dismiss
the complaint for lack of personal jurisdiction. Docs. 10,
Supreme Court recognizes two types of personal jurisdiction:
general (or “all-purpose”) jurisdiction and
specific (or “case-linked”) jurisdiction.
Bristol-Myers Squibb Co. v. Super. Ct. of Cal., 137
S.Ct. 1773, 1779-80 (2017). The parties agree that Van
Leeuwen is not subject to general jurisdiction in North
Carolina. Accordingly, the Court will only consider
whether Van Leeuwen is subject to specific jurisdiction.
has specific jurisdiction over a defendant that has
“purposefully directed his activities at residents of
the forum” and if the “litigation results from
alleged injuries that arise out of or relate to those
activities.” Burger King Corp. v. Rudzewicz,
471 U.S. 462, 472-73 (1985). Out-of-state defendants are
subject to the personal jurisdiction of a federal court only
if both the forum state's long-arm statute and due
process are satisfied. E.g., Universal Leather, LLC v.
Koro AR, S.A., 773 F.3d 553, 558 (4th Cir. 2014). In
North Carolina, these considerations are co-extensive.
Christian Sci. Bd. of Dirs. of First Church of Christ,
Scientist v. Nolan, 259 F.3d 209, 215 (4th Cir. 2001).
determine whether specific jurisdiction lies in the forum
state, courts consider “(1) the extent to which the
defendant purposefully availed itself of the privilege of
conducting activities in the State; (2) whether the
plaintiffs' claims arise out of those activities directed
at the State; and (3) whether the exercise of personal
jurisdiction would be constitutionally reasonable.”
Perdue Foods LLC v. BRF S.A., 814 F.3d 185, 189 (4th
Cir. 2016); accord Carefirst of Md., Inc. v. Carefirst
Pregnancy Ctrs., Inc., 334 F.3d 390, 397 (4th Cir.
2003). The plaintiff must prevail on all three prongs.
Perdue Foods, 814 F.3d at 189.
purposeful availment inquiry requires an evaluation of
several factors, including: (i) whether the
defendant maintains offices or agents in the forum state;
(ii) whether the defendant owns property in the
forum state; (iii) whether the defendant reached
into the forum state to solicit or initiate business;
(iv) whether the defendant deliberately engaged in
significant or long-term business activities in the forum
state; (v) whether the parties contractually agreed
that the law of the forum state would govern disputes;
(vi) whether the defendant made in-person contact
with the resident of the forum in the forum state regarding
the business relationship; (vii) the nature, quality
and extent of the parties' communications about the
business being transacted; and (viii) whether the
performance of contractual duties was to occur within the
forum. Consulting Eng'rs Corp. v. Geometric
Ltd., 561 F.3d 273, 278 (4th Cir. 2009).
contract with an out-of-state party does not always establish
minimum contacts in the plaintiff's home forum, even when
the dispute arises from the contract.” Protocol,
LLC v. Henderson, 18 F.Supp.3d 689, 697-98 (M.D. N.C.
2014) as amended (May 15, 2014) (citing Burger
King, 471 U.S. at 478). On the other hand,
“physical presence in the forum state is not essential,
” Perdue Foods, 814 F.3d at 191, as “it
is an inescapable fact of modern commercial life that a
substantial amount of business is transacted solely by mail
and wire communications across state lines, thus obviating
the need for physical presence within a State in which
business is conducted.” Burger King, 471 U.S.
Stuart has the burden of establishing personal jurisdiction
by a preponderance of the evidence, but he need only make a
prima facie showing absent an evidentiary hearing on the
matter. Carefirst, 334 F.3d at 396. At this stage,
“the district court must draw all reasonable inferences
arising from the proof, and resolve all factual disputes, in
the plaintiff's favor.” Mylan Labs., Inc. v.
Akzo, N.V., 2 F.3d 56, 60 (4th Cir. 1993).
parties have submitted affidavits in support of their
positions. In large part, the parties either agree or have
not offered contradicting evidence on facts presented. The
parties dispute the reasons Mr. Stuart worked remotely from
North Carolina and the extent to which Van Leeuwen expected
Mr. Stuart to conduct business on its behalf in North
Carolina. The Court has drawn all reasonable inferences and
resolved all conflicting facts in the affidavits in Mr.
Stuart's favor, see Indus. Carbon Corp. v. Equity