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Cc Mexicano.Us, LLC v. Aero Ii Aviation, Inc.

United States District Court, D. Nevada

July 31, 2014

CC MEXICANO.US, LLC, Plaintiff(s),
v.
AERO II AVIATION, INC., et al., Defendant(s)

ORDER

JAMES C. MAHAN, District Judge.

Presently before the court is defendants' motion to dismiss pursuant to Federal Rules of Civil Procedure 12(b)(6) and 12(b)(2). (Doc. # 55). The plaintiff responded in opposition, (doc. # 58), and the defendants replied, (doc. # 62).

I. Background

In June 2013, CC.Mexicano.US (hereinafter "plaintiff") met George Blood and Stephen Crittenden (hereinafter "individual defendants") of Aero II Aviation, Inc. (hereinafter "Aero II") in Las Vegas, Nevada and negotiated a deal to finance the defendants' purchase of an airplane. (Doc. # 58). At the meeting, the parties formed a loan agreement in which the plaintiff would finance the purchase of the aircraft. Id. The instant case focuses on the alleged failure of the defendants to fulfill their obligations arising from the loan.

II. Legal Standard

A. FRCP 12(b)(2) Personal Jurisdiction

Nevada has authorized its courts to exercise jurisdiction over persons "on any basis not inconsistent with... the Constitution of the United States." Nev. Rev. Stat. ยง 14.065. Thus, the due process clause of the Fourteenth Amendment is the relevant constraint on Nevada's authority to bind a nonresident defendant to a judgment of its courts. World-Wide Volkswagen Corp. v. Woodson , 444 U.S. 286, 291 (1980). In order to exercise jurisdiction, the nonresident must have "certain minimum contacts... such that the maintenance of the suit does not offend traditional notions of fair play and substantial justice.'" International Shoe Co. v. Washington , 326 U.S. 310, 316 (1945) (quoting Milliken v. Meyer , 311 U.S. 457, 463 (1940)). The inquiry as to whether a forum state may assert specific jurisdiction over a nonresident defendant "focuses on the relationship among the defendant, the forum, and the litigation.'" Keeton v. Hustler Magazine, Inc. , 465 U.S. 770, 775 (1984) (quoting Shaffer v. Heitner , 433 U.S. 186, 204 (1977)).

First, the contacts must arise out of relationships that the "defendant himself" created with the forum state. Burger King Corp. v. Rudzewicz , 471 U.S. 462, 475 (1985). The "minimum contacts" inquiry is defendant-focused and is not satisfied by demonstrating contacts between the plaintiff (or third parties) and the forum state. See Helicopteros Nacionales de Colombia, S.A. v. Hall , 466 U.S. 408, 417 (1984) ("[The] unilateral activity of another party or a third person is not an appropriate consideration when determining whether a defendant has sufficient contacts with a forum [s]tate to justify an assertion of jurisdiction."). No matter how significant the plaintiff's contacts with the forum may be, those contacts cannot determine whether the defendant's due process rights are violated. Walden v. Fiore , 134 S.Ct. 1115, 1121-23 (2014); Rush v. Savchuk , 444 U.S. 320, 332 (1980).

Second, the defendant must have "minimum contacts" with the forum state itself, rather than mere contacts with persons who reside there. See Burger King , 471 U.S. at 478 ("If the question is whether an individual's contract with an out-of-state party alone can automatically establish sufficient minimum contacts in the other party's home forum, we believe the answer clearly is that it cannot"); Kulko v. Superior Court of Cal., City and Cnty. of San Francisco , 436 U.S. 84, 93 (1978) (declining to "find personal jurisdiction in a state... merely because [the plaintiff in a child support action] was residing there"). The defendant's contacts with the forum state may be intertwined with his transactions or interactions with the plaintiff or other parties, but a defendant's relationship with a plaintiff or third party, standing alone, is an insufficient basis for jurisdiction. See Rush , 444 U.S. at 332.

Accordingly, the exercise of personal jurisdiction requires that the defendant has purposefully "reach[ed] out beyond" its state and into another. See, e.g., Burger King , 471 U.S. at 479-480 (holding that court may exercise jurisdiction when defendant entered a contractual relationship that "envisioned continuing and wide-reaching contacts"); Keeton , 465 U.S. at 781 (holding that court may exercise jurisdiction when defendant circulated magazines to "deliberately exploit[]" a market in the forum state). However, although physical presence in the forum is not a prerequisite to jurisdiction, physical entry into the state-either by the defendant in person or through an agent, goods, mail, or some other means-is certainly a relevant contact. See, e.g., Burger King , 471 U.S. at 476; Keeton , 465 U.S. at 773-774.

The Ninth Circuit has established a three-prong test for analyzing specific personal jurisdiction:

(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.

Schwarzenegger v. Fred Martin Motor Co. , 374 F.3d 797, 802 (9th Cir. 2004). "The plaintiff bears the burden of satisfying the first two prongs of the test. If the plaintiff fails to satisfy either of these prongs, personal jurisdiction is not established in the forum state." Id. (internal citations omitted).

"The purposeful availment prong of the minimum contacts test requires a qualitative evaluation of the defendant's contact with the forum state, in order to determine whether [the defendant's] conduct and connection with the forum State are such that [the defendant] should reasonably anticipate being haled into court there." Harris Rutsky & Co. Ins. Servs., ...


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