Case Name: Iain Shovlin v. Paul Careless, et al.

Case No.: 1-13-CV-246878

Defendants Nigel Warr (“Warr”), MoneyExpert Limited (“MEL”), and MoneyExpert Insurance Services Limited (“MEISL”) (collectively, “Defendants”) bring a motion to quash the service of summons for lack of personal jurisdiction or to dismiss for inconvenient forum. (See Code Civ. Proc. [“CCP”], § 418.10 subd. (a)(1)-(2).) Plaintiff Iain Shovlin (“Plaintiff”) opposes Defendants’ motion and renews his prior motion for a continuance and jurisdictional discovery. (See Mihlon v. Super Ct. (1985) 169 Cal.App.3d 703, 710; see also CCP, § 1008, subd. (b).)

Plaintiff bears the initial burden to produce evidence warranting the exercise of jurisdiction over Defendants. (See Goehring v. Super. Ct. (Bernier) (1998) 62 Cal.App.4th 894, 903 [“Goehring”]; see also Anglo Irish Bank Corp., PLC v. Sup. Ct. (2008) 165 Cal.App.4th 969, 978 & 981 [“Irish Bank”] [each defendant’s contacts are assessed individually, an employee’s activities on behalf of a business entity are attributed to the business entity, and great care and reserve should be exercised when extending our notions of personal jurisdiction into the international field].) Since Plaintiff does not submit evidence suggesting that Defendants’ contacts with the forum are substantial, continuous, and systematic, the Court cannot assert general jurisdiction. (See Goehring, supra, at p. 904, citing Vons Companies, Inc. v. Seabest Foods, Inc. (1996) 14 Cal. 4th 434, 445 [“Vons”].) If general jurisdiction cannot be established, a court may assume specific jurisdiction if the plaintiff shows (1) the defendant purposefully availed itself of forum benefits, (2) the controversy is related to or arises out of a defendant’s contacts with the forum, and (3) the assertion of jurisdiction would comport with fair play and substantial justice. (Id., at p. 904, citing Vons, supra, at pp. 446-447.)

Purposeful availment occurs where a nonresident voluntarily and purposefully directs its activities at the forum, purposefully derives benefit from its activities in the forum, creates a substantial connection with the forum, deliberately engages in significant activities within the forum, or creates continuing obligations between itself and residents of the forum, such that the defendant should expect to be subject to the court’s jurisdiction based on those contacts. (Irish Bank, supra, at pp. 978-979, citing Burger King Corp v. Rudzewicz (1985) 471 U.S. 462, 472.) Plaintiff submits evidence sufficient to show that Defendants purposefully derived benefit from their activities in California and created continuing obligations between themselves and residents of California (e.g., Plaintiff was a California resident; Defendants negotiated with Technology Crossover Ventures [“TCV”]—a company with its principal place of business in California—for TCV to invest millions of dollars in MEL, MEISL, and MoneyExpert Holding Limited [collectively, “ME Companies”]; agents of ME Companies—including Warr—traveled to California for investment-related meetings on two occasions; Warr and other agents of ME Companies exchanged numerous emails and phone calls with California residents regarding the investments; and Warr and other agents of ME Companies sent defamatory statements about Plaintiff—a California resident—to third parties in California that harmed Plaintiff’s professional reputation in California). (Darmstadter Dec., Ex. A [Plaintiff’s Complaint]; Plaintiff’s Decl., ¶¶ 6-15 & 17, & Exs. D [emails from Warr to Plaintiff’s supervisor, Will Griffith (“Griffith”), and others in California] & E [Griffith’s deposition transcript].) This evidence is sufficient for Plaintiff to meet his initial burden with respect to the purposeful availment prong. (See Irish Bank, supra, at p. 985 [where individual employees of foreign business entities visited California to meet with potential investors, the court validly exercised personal jurisdiction over the individuals and the business entities in an action arising from the investment transaction]; see also Calder v. Jones (1984) 465 U.S. 783, 788-791 [California courts may properly exercise personal jurisdiction over a nonresident for defamatory statements made outside of the state where the nonresident directed or aimed (i.e. published) the defamatory statements about a California resident to third parties in California and the “effect” of (i.e. harm caused by) the conduct was experienced in California].)

A controversy is related to or arises out of the defendant’s forum contacts if there is a substantial connection between the forum contacts and the plaintiff’s claim. (Vons, supra, at pp. 452, 462-467, & 469-475.) The crucial inquiry concerns the character of defendant’s activity in the forum, whether the cause of action arises out of or has a substantial connection with that activity, and the balancing of the convenience of the parties and the interests of the state in assuming jurisdiction. (Id., at pp. 452-453, citations omitted.) Here, Plaintiff refers to the complaint, wherein he asserts causes of action that are predicated on allegations arising from or related to Defendants’ contacts with California. (Darmstadter Dec., Ex. A.) Accordingly, Plaintiff has met his burden with respect to the second prong.

To determine whether the exercise of jurisdiction would be fair and reasonable, a court must consider (1) the burden on the defendant of defending an action in the forum, (2) the forum state’s interest in adjudicating the dispute, (3) the plaintiff’s interest in obtaining relief, (4) the interstate (or international) judicial system’s interest in obtaining the most efficient resolution of controversies, and (5) the state’s or nations’ shared interest in furthering fundamental substantive social policies. (Irish Bank, supra, at p. 979, citation omitted.) The commission of a tortious act with the forum ordinarily justifies the exercise of specific personal jurisdiction in an action arising from that tortious conduct. (Id., at p. 980, citations omitted.) Where a nonresident purposefully avails itself of forum benefits, the state has a “manifest interest” in adjudicating the dispute. (Vons, supra, at p. 447, citing Burger King, supra, at pp. 473-474.) Since Plaintiff proffers sufficient evidence to demonstrate that Defendants purposefully availed themselves of the forum’s benefits and that this lawsuit arises from Defendants’ contacts with the forum, Plaintiff has met his initial burden with respect to the third prong.

Since Plaintiff has met his initial burden, the burden shifts to Defendants to show that the assertion of personal jurisdiction would be unreasonable. (See Goehring, supra, at p. 903.) Where a defendant purposefully directed his activities at forum residents, the defendant “must present a compelling case that the presence of some other considerations would render jurisdiction unreasonable.” (Irish Bank, supra, at p. 980, citing Burger King, supra, at p. 477.) Defendants contend that it would impose a substantial burden on them to litigate this matter in California because they would have to travel from the United Kingdom to California. However, since “‘modern transportation and communications have made it much less burdensome for a party sued to defend himself in a State where he engages in economic activity,’ it usually will not be unfair to subject him to the burdens of litigating in another forum for disputes relating to such activity.” (Vons, supra, at p. 447, citing Burger King, supra, at p. 474.) Defendants also argue that Plaintiff is no longer a resident of California, and therefore, adjudicating this matter in California does not further Plaintiff’s interests. To the contrary, whether Plaintiff resides in California is immaterial to the issue of whether the Court should exercise personal jurisdiction over Defendants. (See Keeton v. Hustler Magazine, Inc. (1984) 465 U.S. 770, 779-781.) Defendants further assert that since Warr, nonparty Paul Careless, and other unnamed potential witnesses and relevant documents are located in the United Kingdom, litigating this matter in California would not be the most efficient means of resolving the dispute. This reason does not constitute “a compelling case” that exercising personal jurisdiction over Defendants would be unreasonable.

Accordingly, Defendants’ motion to quash is DENIED. Plaintiff’s request to renew his motion for jurisdictional discovery and for a continuance is therefore MOOT.

Turning to Defendants’ motion to dismiss the action for inconvenient forum, Defendants’ own evidence demonstrates that Plaintiff’s defamation claims would be barred by the statute of limitations in the United Kingdom. However, the defendant bears the burden of demonstrating that a suitable alternative forum exists, meaning one in which a valid judgment may be obtained against defendant (e.g., there can be no statute of limitations bar in the alternative forum). (Stangvik v. Shiley, Inc. (1991) 54 Cal.3d 744, 751.) Therefore, Defendants’ motion to dismiss for inconvenient forum is DENIED.