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Luna v. SHAC, LLC

United States District Court, N.D. California, San Jose Division

July 14, 2014

JOHN LUNA, individually and on behalf of all others similarly situated, Plaintiff,
v.
SHAC, LLC dba SAPPHIRE GENTLEMEN'S CLUB, a Nevada corporation, Defendant.

ORDER DENYING MOTION TO DISMISS [Re: Docket No. 10]

HOWARD R. LLOYD, Magistrate Judge.

John Luna, representing a putative class, sues Shac LLC ("Shac"), doing business as Sapphire Gentlemen's Club ("Sapphire"), for allegedly sending unsolicited text messages in violation of the Telephone Consumer Protection Act ("TCPA"). See Class-Action Compl., Dkt. No. 1 ("Compl."). Shac, a Nevada Corporation, moves to dismiss for lack of personal jurisdiction because it does not conduct business in and did not purposefully direct any activity to California. See Mot. Dismiss, Dkt. No. 10. Alternatively, Shac requests a venue transfer to the District of Nevada. Id. Luna opposes the motion asserting that Shac purposefully directed his activity at California by sending text messages to California cell phone numbers. See Mem. P. & A. Opp'n Def. Mot. Dismiss, Dkt. No. 15 ("Opp'n"). The parties have expressly consented to having all matters heard and finally adjudicated by the undersigned. See 28 U.S.C. § 636(c); Fed.R.Civ.P. on May 13, 2014, the Court DENIES Shac's motion to dismiss for lack of personal jurisdiction and DENIES without prejudice Shac's alternative request to transfer venue.

BACKGROUND

Luna's complaint alleges that Shac used automated equipment to send him an unsolicited text message advertising Sapphire in violation of the TCPA, which message he received while he was in Santa Clara County, California. Compl. at ¶¶ 2, 9, 12. He further alleges that Shac sent thousands of similar unsolicited text messages to the cell phones of members of the general public. Compl. at ¶ 13. By declaration, Luna asserts that he received a total of four or five such text messages from Shac while living in Santa Clara County, and his cell phone number had a 408 area code, which is associated with Santa Clara County. Decl. John Luna Opp'n Def. Mot. Dismiss at ¶¶ 2-4, Dkt. No. 16. Luna also provides the declaration of Sunil Daniel who received three or four similar unsolicited text messages from Shac. Decl. Sunil Daniel Opp'n Def. Mot. Dismiss at ¶ 4, Dkt. No. 17. At all relevant times, Daniel was a resident of Los Angeles, California, and his cell phone had a 310 area code, which is associated with Los Angeles. Id. at ¶ 2.

Shac asserts that it has not conducted any business in California during the relevant time period. Aff. Peter Feinstein Supp. Def.'s Mot. Dismiss at ¶ 10, Dkt. No. 10-1. And even if it did send text messages as alleged by Luna, "such messages would disseminate from a static database of customers and individuals who had first made contact with SHAC in Nevada, and therefore SHAC lacks any direct knowledge of the forum states of any persons in the database." Id. at ¶ 11. Thus, Shac maintains it "has not intentionally solicited any business or customers from the State of California." Id. at ¶ 13. Additionally, Shac asserts that "all potential witnesses, databases, documents, evidence, and tangible information are located within the State of Nevada, and not California." Id. at ¶ 12.

LEGAL STANDARD

A. Personal Jurisdiction

The party seeking to invoke jurisdiction of the federal court has the burden of establishing that such jurisdiction exists. Data Disc, Inc. v. Systems Tech. Assoc., Inc., 557 F.2d 1280, 1285 (9th Cir. 1977). At this stage of the litigation, the plaintiff need only "make, through [his] pleadings and affidavits, a prima facie showing of the jurisdictional facts." Myers v. Bennett Law Offices, 238 F.3d 1068, 1071 (9th Cir. 2001). In ruling on a Rule 12(b)(2) motion, the court should view the pleadings in a light most favorable to plaintiff and all doubts are to be resolved in his favor. Caruth v. Int'l Psychoanalytical Ass'n, 59 F.3d 126, 128 n.1 (9th Cir. 1995).

"Unless a defendant's contacts with a forum are so substantial, continuous, and systematic that the defendant can be deemed to be present' in that forum for all purposes, a forum may exercise only specific' jurisdiction - that is, jurisdiction based on the relationship between the defendant's forum contacts and the plaintiff's claim." Yahoo! Inc. v. La Ligue Contre le Racisme et l'Antisemitisme, 433 F.3d 1199, 1205 (9th Cir. 2006). The Ninth Circuit has "established a three-prong test for analyzing a claim of specific personal jurisdiction: (1) The non-resident defendant must purposefully direct his activities or consummate some transaction with the forum or resident thereof;... (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).[1] "The plaintiff bears the burden on the first two prongs. If the plaintiff establishes both prongs one and two, the defendant must come forward with a compelling case' that the exercise of jurisdiction would not be reasonable." Boschetto v. Hansing, 539 F.3d 1011, 1016 (9th Cir. 2008).

The Ninth Circuit "evaluate[s] purposeful direction under the three-part effects' test traceable to the Supreme Court's decision in Calder v. Jones. " Schwarzenegger, 374 F.3d at 803. The "effects" test "requires that the defendant allegedly have (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." Id. (quoting Dole Food Co. v. Watts, 303 F.3d 1104, 1111 (9th Cir. 2002).

B. Venue

"For the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district... where it might have been brought...." 28 U.S.C. § 1404(a). "Section 1404(a) is intended to place discretion in the district court to adjudicate motions for transfer according to an individualized, case-by-case consideration of convenience and fairness." Stewart Organization, Inc. v. Ricoh Corp., 487 U.S. 22, 29 (1988) (internal quotation marks removed). "A motion to transfer venue under § 1404(a) requires the court to weigh multiple factors in its determination whether transfer is appropriate in a particular case." Jones v. GNC Franchising, Inc., 211 F.3d 495, 498 (9th Cir. 2000). Such factors may include: (1) the location where the relevant agreements were negotiated and executed; (2) the state that is most familiar with the governing law; (3) the plaintiff's choice of forum; (4) the respective parties' contacts with the forum; (5) the contacts relating to the plaintiff's cause of action in the chosen forum; (6) the differences in the costs of litigation in the two forums; (7) the availability of compulsory process to compel attendance of unwilling non-party witnesses; and (8) the ease of access to sources of proof. Id. at 498-99. "The defendant must make a strong showing of inconvenience to warrant upsetting the plaintiff's choice of forum." Decker Coal Co. c. Commonwealth Edison Co., 805 F.2d 834, 843 (9th Cir. 1986).

DISCUSSION

A. Personal ...


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