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Linda Shorter v. Peaches Uniforms

December 7, 2010

LINDA SHORTER,
PLAINTIFF,
v.
PEACHES UNIFORMS, INC., DEFENDANT.



The opinion of the court was delivered by: Morrison C. England, Jr. United States District Judge

MEMORANDUM AND ORDER

Presently before the Court is a Motion by Defendant Peaches Uniforms, Inc. ("Defendant") to dismiss Plaintiff Linda Shorter's ("Plaintiff") claims pursuant to Federal Rule of Civil Procedure*fn1 12(b)(2) for lack of personal jurisdiction or, in the alternative, dismiss for improper venue pursuant to Rule 12(b)(3). In the event the Court finds jurisdiction and venue proper, Defendant requests this Court transfer the case to the Northern District of Texas, Dallas Division, pursuant to 28 U.S.C. § 1404(a). For the reasons set forth below, Defendant's Motion is denied.

BACKGROUND

Defendant, a Texas corporation operating out of Dallas, is a leading provider of women's medical uniforms and scrubs. In 1987, Plaintiff began working for Defendant in Dallas. She continued to work in Dallas until 1994, at which time she requested to work from home so she could move to Iowa. In 2007, Plaintiff sought and received Defendant's permission to move to California and continue working from home. In both cases, Plaintiff's reasons for relocating were unrelated to her duties as Defendant's employee.

Upon moving to Lodi, California, Plaintiff received a bonus from Defendant, which she used as a down payment on a home. Defendant also wrote an employment verification letter to Plaintiff's mortgage company, which stated that Plaintiff would continue to be employed in the same position and at the same rate of pay. Notwithstanding the bonus and the letter, approximately seven months after Plaintiff moved to California, Defendant called Plaintiff and terminated her employment.

Although Defendant's operations are primarily based out of Dallas, Defendant sells goods in California, and in 2007 sold approximately $1.5 million in goods in the state. Rather than operate stores in California, Defendant only sold its products at wholesale to retailers. Defendant also advertises its goods in California. According to Plaintiff, Defendant placed advertisements on billboards, automobiles, and in magazines circulated around the state of California.

Although Defendant did not have any offices in California, it did have multiple employees residing in California. The parties disagree about the number of employees living in the state, but it is undisputed that, in addition to Plaintiff, at least one other employee lived in California at the time of Plaintiff's termination. Similar to Plaintiff, this employee was not required to live in California.

Plaintiff brought the current action against Defendant, alleging breach of contract, breach of the covenant of good faith and fair dealing, detrimental reliance, wrongful termination in violation of public policy, intentional misrepresentation, and slander. Plaintiff's slander claim is based on statements Defendant made to its competitors and vendors in California. Defendant allegedly told competitors and vendors that Plaintiff was a partner in the company, had a non-compete agreement with Defendant, and that Plaintiff was responsible for Defendant's decline in revenue. Defendant now moves to dismiss all claims on grounds that the Court lacks personal jurisdiction over Defendant and the Eastern District of California is an improper venue. Alternatively, Defendant requests that the matter be transferred to the Northern District of Texas.

STANDARD

A party may seek dismissal of a claim for lack of personal jurisdiction under Rule 12(b)(2). The burden of establishing personal jurisdiction rests with the plaintiff. Boschetto v. Hansing, 539 F.3d 1011, 1015 (9th Cir. 2008).

If the court decides a Rule 12(b)(2) motion without conducting an evidentiary hearing, the plaintiff need only make a prima facie showing of the facts in support of personal jurisdiction. Tuason v. R.J. Reynolds Tobacco Co., 433 F.3d 1163, 1168 (9th Cir. 2006). In deciding whether a prima facie showing has been made, a court need only consider the pleadings and any submitted affidavits. Baschetto, 539 F.3d at 1015. All uncontroverted allegations are taken as true, and "[c]onflicts between the parties over statements contained in affidavits must be resolved in the plaintiff's favor." Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004).

Where there is no federal statute governing personal jurisdiction, courts apply the long arm statute of the state in which the court sits is applied. Baschetto, 539 F.3d at 1015. The applicable California statute allows the exercise of jurisdiction to the full extent permitted by federal constitutional due process. Id. As a result, "the jurisdictional analyses under state law and federal due process are the same." Schwarzenegger, 374 F.3d at 801. Due process requires that the nonresident defendant have certain "minimum contacts" with the forum, such that the exercise of jurisdiction does not offend traditional notions of fair play and substantial justice. Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945).

ANALYSIS

Plaintiff seeks redress for, among other things, breach of contract, wrongful termination, detrimental reliance, and slander. The issue presently before the Court is whether it may properly exercise personal jurisdiction over Defendant. In the event the Court finds jurisdiction proper, Defendant moves to dismiss for improper venue or, in the alternative, to transfer venue to the Northern District of Texas.

A. Personal Jurisdiction

There are two different forms of personal jurisdiction from a due process perspective, general and specific. Boschetto, 539 F.3d at 1016. Plaintiff contends that both forms permit this Court ...


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