United States District Court, N.D. California
October 20, 2005.
STEVEN T. KIRSCH, Plaintiff,
JAVIER A. CUADRA, et al., Defendants.
The opinion of the court was delivered by: MARTIN JENKINS, District Judge
Pending before the Court is Defendant Jere Ross's (aka Jerry
Ross) Motion to Dismiss for Lack of Personal Jurisdiction (Doc.
#5). Plaintiff Steven Kirsch has filed an Opposition (Doc. #22),
and Defendant Ross has filed a Reply (Doc. #32). For the
following reasons, the Court grants Defendant Ross's Motion.
On January 25, 2005, Plaintiff filed a Complaint in California
Superior Court against Javier A. Caudra, Camelot Promotions, LLC,
and various Doe defendants, alleging that the defendants violated
the federal Telephone Consumer Protection Act ("TCPA"),
47 U.S.C. § 227.*fn1 (Doc. #1, ex. 1 "Complaint.") Specifically,
Plaintiff alleges that, beginning on April 4, 2004, the
defendants sent 18 unsolicited advertisements to his facsimile
line. (Compl. at ¶¶ 9, 11.) Based on this conduct, Plaintiff seeks $41,000 in damages, $82,000 in trebled statutory
damages,*fn2 an injunction prohibiting the defendants from
engaging in the alleged conduct, and an award of attorneys' fees
and costs. (Id. at 6.) At some point after Plaintiff filed his
Complaint, the Superior Court entered default against Defendants
Javier Caudra and Camelot Promotions, LLC. Subsequently, on June
23, 2005, Plaintiff amended his Complaint to substitute Defendant
Ross for Defendant Doe 1. On July 25, 2005, Defendant Ross
removed the case to this Court on the basis of federal question
and diversity jurisdiction.*fn3 (Doc. #1.) He now moves to
dismiss the Complaint on the ground that this Court lacks
jurisdiction over him.
II. Legal Standard
Pursuant to Federal Rule of Civil Procedure 12(b)(2), a
defendant may move to dismiss a complaint for lack of personal
jurisdiction. As the party seeking to invoke the federal court's
jurisdiction, the plaintiff bears the burden of establishing that
jurisdiction exists. Data Disc, Inc. v. Sys. Tech. Assocs.,
Inc., 557 F.2d 1280, 1285 (9th Cir. 1977); Schwarzenegger
v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004).
If the Court rules on the motion based on written materials
without an evidentiary hearing, the plaintiff need only make a
prima facie showing of jurisdictional facts. Id. In such
cases, the Court examines whether the plaintiff's pleadings and
affidavits contain sufficient factual allegations to make a
prima facie showing of personal jurisdiction. Caruth v. Int'l
Psychoanalytical Ass'n, 59 F.3d 126, 128 (9th Cir. 1995).
"Although the plaintiff cannot `simply rest on the bare
allegations of its complaint,' uncontroverted allegations in the
complaint must be taken as true." Schwarzenegger,
374 F.3d at 800 (internal citations omitted). In reviewing the written
materials, the Court resolves factual conflicts in the parties'
affidavits in the plaintiff's favor. AT&T, 94 F.3d at 588. Generally, A district court sitting in diversity has personal
jurisdiction to the extent provided by the law of the forum
state. Data Disc., Inc., 557 F.2d at 1286. California's
jurisdictional statute*fn4 is co-extensive with federal due
process requirements; therefore, jurisdictional inquiries under
state law and federal due process standards collapse into one,
and the Court considers only whether the exercise of jurisdiction
over the defendant comports with due process. Glencore Grain
Rotterdam B.V. v. Shivnath Rai Harnarain Co., 284 F.3d 1114,
1123 (9th Cir. 2002). Specifically, to satisfy constitutional
due process, the non-resident defendant "must have at least
`minimum contacts' with the relevant forum such that the exercise
of jurisdiction `does not offend traditional notions of fair play
and substantial justice.'" Schwarzenegger, 374 F.3d at 801
(quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 316
(1945)). Depending on the defendant's contacts with California,
the Court may exercise either general or specific jurisdiction.
Because Plaintiff has not presented any argument in support of
general jurisdiction over Defendant Ross in this action, the
Court limits its analysis to determining whether specific
"A court exercises specific jurisdiction where the cause of
action arises out of or has a substantial connection to the
defendant's contacts with the forum." Glencore Grain Rotterdam
B.V., 284 F.3d at 1123. The Court applies a three-part test when
assessing specific 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
(2) the claim must be one which arises out of or
relates to the defendant's forum-related activities;
(3) the exercise of jurisdiction must comport with
fair play and substantial justice, i.e., it must be
Lake v. Lake, 817 F.2d 1416
, 1421 (9th Cir. 1987);
Bancroft & Masters, Inc., 223 F.3d at 1086 (9th Cir. 2000).
The plaintiff bears the burden of satisfying the first two prongs
of the test. Schwarzenegger, 374 F.3d at 802. If the plaintiff
fails under either prong, the Court must find that personal
jurisdiction does not exist in the forum state. Id. If the
plaintiff satisfies both prongs, the burden shifts to the
defendant to "present a compelling case" demonstrating that the exercise of
jurisdiction would be unreasonable. Id. (citing Burger King
Corp. v. Rudzewicz, 471 U.S. 462
, 276-78 (1985)).
A. Defendant Ross's Motion
Defendant Ross contends that the Court must dismiss Plaintiff's
Complaint because the Court lacks personal jurisdiction over him.
Specifically, he argues that Plaintiff has not and cannot make a
prima facie showing of jurisdiction. In support of his Motion,
Defendant Ross has filed a Declaration. (Doc. #7.) The following
statements are taken from his Declaration.
Defendant Ross is a United States citizen and a resident of
Florida. He is an attorney licensed to practice law in Florida,
and is a name shareholder in the Tampa law firm of Bush Ross,
P.A. The law firm's only office is in Tampa; it has never
maintained an office in California. Neither Defendant Ross, nor
any member of his law firm, is licensed to practice in
California. Defendant Ross has never represented a client with
primary business interests in California and has not had any
personal business interests in California. Defendant Ross does
not own any real property in California.
The last time Defendant Ross visited California was in 1998,
for recreational purposes. Before that trip, Defendant Ross had
visited California several times for depositions in a federal
securities case in the 1980's, a vacation in the 1970's, several
recreational trips in the 1960's, and a three-month stay at Camp
Pendleton in 1962, during which time he was a lieutenant in the
United States Marine Corps.
Defendant Ross avers that he has "no acquaintance or
affiliation with either [Defendant Cuadra or Defendant Camelot
Promotions, LLC] nor any knowledge of their existence other than
in connection with this legal action by plaintiff." He states
that they are not clients of Bush Ross, and that neither Bush
Ross nor any of its employees has ever served as an agent or
employee for either of the named defendants.
Defendant Ross further avers that neither he, nor any member or
employee of his law firm sent any of the alleged facsimiles to
Plaintiff; participated in or discussed with anyone else the
sending of such facsimiles; or was aware that any of the alleged
facsimiles were sent to Plaintiff.
Finally, Defendant Ross states that he has never met Plaintiff,
whether in California or elsewhere. He states that his only communications with Plaintiff
has been by phone and email, and that Plaintiff initiated these
contacts while Defendant Ross was at his Tampa office. He
indicates that these contacts involved Plaintiff's inquiries
about Defendant Ross's knowledge of Concorde America, Inc.,
certain persons appearing to have a relationship to that entity,
and its responses to unusual volume in the public trading of
shares of its capital stock in August 2004. Defendant Ross avers
that neither he, nor his law firm, ever marketed, offered for
sale, or sold any product or service in California via facsimile
transmission. He also states that, because he is subject to the
jurisdiction of the state and federal courts of Florida, he will
voluntarily appear in the court in Florida if the Court dismisses
this case and Plaintiff re-files in Florida.
B. Plaintiff's Opposition and Supporting Declarations
In response, Plaintiff maintains that he has alleged sufficient
facts connecting Defendant Ross to the fax transmissions that
form the basis of his Complaint. Particularly, Plaintiff argues
that he has pled adequate facts establishing that Defendant Ross
had the requisite minimum contacts to provide a basis for this
Court to exercise specific jurisdiction over him. (Opp. at 10.)
Looking first at Plaintiff's Complaint, Plaintiff alleges, in
9. Beginning before or about April 4, 2004,
defendants engaged in a campaign to market and sell
their products in the State of California.
Specifically, defendants sent facsimiles containing
advertisements of the commercial availability or
quality of their property, goods, and/or services,
without the recipients' prior express invitation or
permission, to facsimile machines in California.
. . .
11. Defendants sent eighteen such facsimiles to a
facsimile line owned by plaintiff.
. . .
15.  None of the eighteen faxes that are the
subject of this litigation complied with [the
requirements in C.F.R. § 68.318(d).]
. . .
17. Plaintiff is informed and believes that, with
respect to each violation, each defendant had actual
notice of participation, or a high degree of
involvement, in a plan to violate the [Telephone
Consumer Protection Act] by, for example, knowing
that the transmitted faxes were unlawful
advertisements, by participating in preparing their
content, by providing or obtaining the fax telephone
number of plaintiff or other recipients, by knowing
that plaintiff or other recipients had not authorized the faxes' transmission by prior express
invitation or permission, and/or by failing to stop
the sending of the faxes.
. . .
19. Plaintiff is informed and believes, and on that
basis alleges, that defendants' foregoing actions
constitute part of a pattern and practice by
defendants of sending unsolicited facsimiles
containing unsolicited advertisements to facsimile
machines in California.
(Doc. #1, ex. 1.)
Additionally, as part of his Opposition to Defendant Ross's
Motion, Plaintiff has submitted his Declaration (Doc. #24), and a
Declaration from his counsel, John Brown (Doc. #23). In his
Declaration, Plaintiff states as follows. Plaintiff received at
his facsimile machine in California 18 advertisements promoting
the stocks TWTN ("Twister Networks, Inc."), BDYS ("Body Scan
Technologies"), AHFI ("Absolute Health & Fitness, Inc."), and
CNDD ("Concorde America, Inc."). Plaintiff avers that each of the
18 faxes was a fraudulent stock tout, and that he later obtained
information indicating that each was sent as part of a "pump and
dump" scheme. Upon receiving the faxes, Plaintiff called a number
listed on two of the faxes and learned that the name of the
service that took his call was "MyFaxOnDemand." Plaintiff asked
who was paying for the listed stock advertisement and was
informed that it was Defendant Javier Cuadra of Camelot
Plaintiff states that 7 of the 18 faxes referred to the website
www.winningstockpicks.net, where the recipient could access a
full report on the stock described in the fax. Plaintiff called
Mr. Cuadra and asked if he had heard of the website, to which Mr.
Cuarda responded that he had. Plaintiff then accessed the website
and learned that Tom Heysek was the website's editor. After
locating Mr. Heysek, Plaintiff filed a lawsuit against him for
sending the 18 faxes. Plaintiff states that the
winningstockpicks.net website listed Vault Studios as the creator
of a video in which Mr. Heysek interviewed a person purporting to
be the C.E.O. of Absolute Health & Fitness, Inc., which was a
company in three of the faxes. Plaintiff then spoke with Jon
Paulson of Vault Studios, who informed Plaintiff that the video
was directed by three people: Tom Heysek, Bryan Kos, and Paul
Spreadbury. Mr. Paulson also informed Plaintiff that Vault
Studios was paid by a law firm for its work on the video.
Plaintiff states that he thereafter contacted Mr. Spreadbury,
who told Plaintiff that he had done some work for the website and
that he had been paid by a law firm. During a later conversation, Plaintiff asked Mr. Spreadbury who paid for the video publicizing
Absolute Health. Mr. Spreadbury responded that the law firm Bush,
Ross, Gardner, Warren & Rudy*fn5 paid for his work.
Plaintiff states that he later saw a press release issued on
August 2, 2004 by www.uspennystocks.com,*fn6 stating that it
had hired Fry/Hammond/Barr to create a multi-media campaign.
Plaintiff contacted Fry/Hammond/Barr and spoke to Janette Estep,
who confirmed that Fry/Hammond/Barr had been hired to produce
television advertisements for uspennystocks.com. Plaintiff asked
Ms. Estep who had paid for the advertisements, and she responded
that she could not release that information without a subpoena.
Plaintiff then subpoened documents from Fry/Hammond/Barr relating
to uspennystocks.com. He states that he received a record
indicating that Fry/Hammond/Barr was paid $336,000 by Bush, Ross,
Garder, Warren & Rudy, from SunTrust Bank account #41001143506
for their work on the television ads.
In August 2004, Plaintiff learned that Hartley Lord was the
founder and President of Concorde America, one of the companies
advertised in the faxes. Plaintiff contacted Mr. Lord and asked
about Concorde's stock promotions. Mr. Lord told Plaintiff that
he was represented by Defendant Ross. He further told Plaintiff
that he had met Defendant Ross after Donald Oehmke, the owner of
Ventana Consultants, had offered to buy stock from Mr. Lord and
recommended that his attorney, Defendant Ross, handle the
Plaintiff states that "[a]s of August 12, 2004, [he] had
obtained information that Ross was involved with the scheme," and
that he called Defendant Ross at his law firm to get more
information about "the scheme". Plaintiff avers that Defendant
Ross stated that he was associated with Bryan Kos, and that
Ventana Consultants (which Mr. Lord had indicated was run by Mr.
Oehmke), was one of his clients. Plaintiff states that he
mentioned to Defendant Ross that he believed that the faxes were
part of a pump and dump scheme, and Mr. Ross agreed. Plaintiff
states that Defendant Ross also indicated that he had written a
press release for Concorde dated August 10, that stated two prior
press releases dated July 28 and August 9 "hyping" Concorde stock
were fraudulent and that Concorde disclaimed any involvement in the composition or dissemination of the earlier
Plaintiff states that he again called Defendant Ross at his law
firm's phone number. Plaintiff states that he asked the person
who answered the phone whether any of the law firm partners
represented Mr. Kos, who Plaintiff claims was involved in the
pump and dump scheme. Plaintiff states that the receptionist told
him that Defendant Ross "was the point person to contact at the
law firm regarding Bryan Kos." Plaintiff also avers that
Defendant Ross indicated in email correspondence that he had
provided legal services to two corporations in which Mr. Kos had
involvement, and that he provides representation to a corporation
that Mr. Oehmke owns.
Plaintiff indicates that on February 15, 2005 the Securities
and Exchange Commission filed a Complaint in the United States
District Court for the Southern District of Florida against
persons and entities it alleged were involved with the pump and
dump scheme that Plaintiff believes included the faxes he
received. Plaintiff states that Concorde, Absolute Health, Mr.
Lord, Mr. Oehmke, Mr. Kos, Mr. Heysek, Andrew Kline, and Mr.
Spreadbury are named as defendants in that action. Plaintiff
indicates that the May 31, 2005 Joint Scheduling Report states
that Defendant Ross represents Mr. Lord and Concorde in the SEC
action. Plaintiff also states that Exhibit 1 to the SEC's
Complaint is a Declaration from an SEC staff accountant, Timothy
J. Galdencio. Plaintiff explains that in the Declaration Mr.
Galdencio states that the profits from some of the stock trades
that the SEC was investigating (which Plaintiff claims were of
the same stock that was advertised in the 18 faxes he received)
went into the Bush, Ross, Gardner, Warren & Rudy SunTrust Bank
account #41001143506, and totaled $5,307,741.
Plaintiff further declares that, when he was attempting to
collect on his judgments against Mr. Heysek, Plaintiff asked him
how much he received for the writeups of the stocks advertised in
the faxes. Mr. Heysek responded that he was paid approximately
$20,000 a month for his writeups. Plaintiff states that he
thereafter subpoenaed Mr. Heysek's bank records as well as bank
records from Asian American Capital, a company which Mr. Heysek
headed. Plaintiff avers that he obtained a record showing that
Asian American Capital received payments from the Bush, Ross,
Gardner, Warren & Rudy SunTrust Bank account $41001143506.
Specifically, he states that Heysek received $24,000 on August 3,
2004, and $23,000 on July 7, 2004 from that account. Plaintiff states
that he "immediately suspected that these payments were for [Mr.]
Heysek's writeups of the touted stocks, because [Mr.] Heysek had
previously told [him] that he was being paid about $20,000 a
month for the writeups."
Plaintiff has also submitted the Declaration of his attorney in
this matter, John Brown. In his Declaration, Mr. Brown states,
"[Plaintiff] has for some time had  evidence that [Defendant]
Ross retained Camelot to retain a California company, Fax.com, to
send some of the junk faxes." He indicates that he subpoened
statements from SunTrust Bank, all statements for bank accounts
held by Camelot Promotions, LLC, during the months of June
through August 2004, in an effort to identify the persons that
hired Camelot to send the faxes. He states that SunTrust's
records showed that six of the seven largest dollar figure wire
transfers totaling $355,000, came from Bush, Ross, Gardner,
Warren & Rudy's SunTrust Bank account #41001143506. Based on this
information, Mr. Brown states that he concluded that "Camelot, a
penny-ante company with little cash flow, was laundering very
large amounts of money to fund a junk faxing operation directed
by the persons that were paying it for the faxes, including
Jeremy Ross." He further states that he attempted to contact
Defendant Ross and his counsel to get information about the
faxes, but Defendant Ross refused to provide any information in
C. Plaintiff's Prima Facie Case
As detailed above, to survive Defendant Ross's Motion,
Plaintiff need only make a prima facie showing of jurisdiction.
Because Plaintiff has not argued that general jurisdiction
exists, the Court must examine whether it has specific
jurisdiction over Defendant Ross in this matter.
A. Purposeful Availment or Purposeful Direction
To support a finding that specific jurisdiction exists,
Plaintiff must initially demonstrate that Defendant Ross either
purposefully availed himself of the privilege of conducting
activities in California, or purposefully directed his activities
toward California. Burger King Corp., 471 U.S. at 476-78;
Lake, 817 F.2d at 1421. "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 here." Schwarzenegger, 374 F.3d at 802. In this way,
a defendant "purposefully avails itself of the privilege of
conducting activities in the forum [s]tate, thus invoking the benefits and privileges of its laws." Hanson
v. Denckla, 357 U.S. 235, 253 (1958).
Alternatively, "[a] showing that a defendant purposefully
directed his conduct toward a forum state . . . usually consists
of evidence of the defendant's actions outside the forum state
that are directed at the forum[.]" Schwarzenegger,
374 F.3d at 803. The Court assesses purposeful direction under the tripartite
effects test set forth in Calder v. Jones 465 U.S. 783, 788-90
(1984). Under this test, the plaintiff must prove that the
defendant: "(1) committed an intentional act, (2) expressly aimed
at the forum state, (3) causing harm that the defendant knows is
likely to be suffered in the forum state." Dole Food Co. v.
Watts, 303 F.3d 1104, 1111 (9th Cir. 2002). Examining
Plaintiff's Complaint and supporting Declarations, the Court
finds that Plaintiff has failed to allege sufficient facts to
satisfy his burden under either a purposeful availment or
purposeful direction theory.
Starting with Plaintiff's Complaint, as the excerpt set forth
above illustrates, Plaintiff has not made any allegations as to
Defendant Ross's conduct, specifically. Rather, Plaintiff alleges
that the defendants, generally, violated the FTCPA by sending 18
faxes to him containing unsolicited advertisements. These
conclusory statements, while adequate to state a claim under Rule
8(a), are insufficient to sustain a finding that Defendant Ross
either purposefully availed himself of the privilege of
conducting activities in California, or committed an intentional
act aimed at California. See Dever v. Hetzen Coastings, Inc.,
380 F.3d 1070, 1074 (8th Cir. 2004) (conclusory allegations
in complaint are insufficient to establish minimum contacts). The
Court therefore turns to Plaintiff's Declarations.
Although Plaintiff has set forth a detailed account of the
purported events underlying his lawsuit, Plaintiff nevertheless
fails to identify any conduct by Defendant Ross that would
support a finding that Defendant Ross had the requisite minimum
contacts with California. At most, Plaintiff has alleged that
Defendant Ross represents certain people and entities who
Plaintiff claims were responsible for the faxes he received.
However, none of people or entities are defendants in this
action. Furthermore, the Court fails to see how Defendant Ross's
legal representation of Florida clients, in Florida, demonstrates
an intent to avail himself of the privilege of conducting
business in California, or amounts to an intentional act directed
Plaintiff also argues that "based on the documents he received
pursuant to subpoena . . . Ross paid for the junk faxes at issue." This assertion, however, lacks
any support in either of Plaintiff's Declarations. Specifically,
both Plaintiff and Mr. Brown aver that the money transfers were
from Bush, Ross, Gardner, Warren & Rudy SunTrust Bank account
#41001143506. While Defendant Ross may be a partner of this firm,
the fact that the funds were transferred from the firm account
does not constitute conduct by Plaintiff. Indeed, Plaintiff has
not alleged that this was Defendant Ross's personal account or
that Defendant Ross directed or authorized the transfers. More
importantly, even accepting Plaintiff's statement as true, the
Court fails to see how this act of transferring funds
demonstrates purposeful contact with California.*fn8
Plaintiff also contends that under the TCPA, "one like Ross who
directed the actual fax sender to press the button to send the
fax is ultimately responsible for the legal violations." Again,
neither Plaintiff's Complaint, nor his supporting Declarations
contain any allegations to support this charge.*fn9
Particularly, Plaintiff has failed to cite to any specific
statement or allegation, and the Court has found none, either
directly stating, or from which the Court could infer, that
Defendant Ross directed someone to send the 18 faxes Plaintiff
Further, Plaintiff has failed to proffer any statements in
either his Complaint or Declarations contradicting several
critical statements in Defendant Ross's Declaration. In his
Declaration, Defendant Ross avers that he does not have any
personal or business contacts with California; that he does not
know Defendants Cuadra or Camelot Promotions; and that neither
he, nor any member of his firm sent, directed another to send, or
was aware of any of the offending faxes. Even in light of the
detailed account Plaintiff provides in his Declaration, Defendant
Ross's statements remain uncontroverted. More importantly, these facts support the finding that Defendant Ross
has neither availed himself of the privilege of doing business in
California, nor committed an intentional act aimed at, and
causing harm in, California.
In sum, Plaintiff has failed to allege sufficient facts
demonstrating that Defendant Ross either purposefully availed
himself of the privilege of conducting activities in California
or purposefully directed conduct toward California. Because
Plaintiff has failed to make this threshold showing necessary to
establish specific jurisdiction, he cannot make a prima facie
showing that personal jurisdiction exists. Consequently, the
Court finds that it lacks jurisdiction over Defendant Ross in
For the reasons stated above, the Court GRANTS Defendant
Ross's Motion to Dismiss for Lack of Personal Jurisdiction (Doc.
IT IS SO ORDERED.
© 1992-2005 VersusLaw Inc.