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Klayman v. Deluca

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

January 30, 2015

LARRY KLAYMAN, Plaintiff,
v.
STEPHANIE A. LUCK DELUCA, SUZANNE JAMBE, JAMES ROLLINSON, BAKER HOSTETLER, HEWITT B. SHAW, EBAY, INC., PAYPAL, INC., Defendants.

ORDER GRANTING RULE 12(B)(1) AND 12(B)(2) MOTIONS TO DISMISS; DENYING AS MOOT RULE 12(B)(6) MOTIONS TO DISMISS; DENYING AS MOOT MOTIONS TO STRIKE [Re: Dkt. Nos. 24, 27, 29, 30, 34]

EDWARD J. DAVILA, District Judge.

Plaintiff Larry Klayman ("Plaintiff") initiated the instant action against Defendants Stephanie A. Luck Deluca ("Deluca"), Baker Hostetler ("Baker Firm"), Suzanne Jambe ("Jambe"), James Rollinson ("Rollinson"), Hewitt B. Shaw ("Shaw"), [1] eBay, Inc. ("eBay"), and PayPal, Inc.'s ("PayPal") alleging fraud, tort claims, and violation of the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. § 1961, et seq. ("RICO"). Presently before the court are Defendants' motions to dismiss for lack of jurisdiction and failure to state a claim, and motions to strike pursuant to California's Anti-SLAPP statute, Cal. Civ. Proc. Code § 425.16. The court found these matters suitable for decision without oral argument pursuant to Civil Local Rule 7-1(b) and previously vacated the hearing. Having reviewed the parties' briefing, the court GRANTS Deluca, Jambe, Rollinson, and Shaw's motions to dismiss for lack of jurisdiction, and DENIES AS MOOT the remaining motions to dismiss and motions to strike.

I. BACKGROUND

This action arises from an underlying divorce and child custody dispute in Ohio. Plaintiff alleges that in 2003, Plaintiff and Deluca divorced, both entering into a Consent Marital Settlement Agreement that contained a choice of law provision requiring the application of Virginia law. Compl. at ¶ 14. Deluca hired the Baker Firm to represent her in the divorce and custody proceedings. Id. at ¶ 15. In 2007, after Deluca remarried, she allegedly precluded Plaintiff from visiting or contacting the children. Id. at ¶ 17. Consequently, Plaintiff withheld child support relying on Virginia law, which provides a complete defense for non-payment of child support when the obligor is denied access to one's children. Id. at ¶ 19. Plaintiff alleges that an Ohio court, however, erroneously applied Ohio law and found Plaintiff in contempt for the non-payment. Id. at ¶ 20. The Ohio court also awarded a judgment of $320, 000 in attorneys' fees to Deluca. Id.

Plaintiff alleges that in 2011, the Baker Firm and the Baker Attorneys filed a motion to show cause for Plaintiff's non-payment of the judgment. Id. at ¶ 21. In 2012, an Ohio court allegedly issued subpoenas, which the Baker Firm and Baker Attorneys served on PayPal. Id. at ¶ 24. With the subpoena, Deluca, the Baker Firm, and the Baker Attorneys allegedly sought to induce PayPal into releasing financial records that they believed contained Plaintiff's banking information. Id . Plaintiff filed a motion to quash the subpoenas, and PayPal objected to the subpoenas. Id. at ¶ 28-30. After Deluca, the Baker Firm, and the Baker Attorneys allegedly induced the release of Plaintiff's PayPal account information, PayPal released the information. Id. at ¶¶ 31-34. Upon hearing of the release of the documents, Plaintiff contacted PayPal, and PayPal then demanded the return of the released documents and information. Id. at ¶¶ 37-38. Plaintiff alleges that the Baker Firm and the Baker Attorneys made photocopies or kept electronic copies of the released documents, and provided them to Deluca. Id. at ¶ 40.

Plaintiff commenced the instant action in July 2014. See Dkt. No. 1. Plaintiff alleges the following claims against Deluca, the Baker Firm, and the Baker Attorneys: (1) fraud by statement to third parties; (2) fraud; (3) intrusion into private affairs; (4) trespass to chattels; (5) conversion; (6) unlawful, unfair, fraudulent business practices; (7) civil violations of RICO; and (8) conspiracy to engage in RICO. See id. Plaintiff also alleges the following claims against PayPal: (1) breach of contract; and (2) negligence. See id. In August 2014, Defendants filed a series of motions to dismiss for lack of jurisdiction, motions to dismiss for failure to state a claim, and motions to strike pursuant to California's Anti-SLAPP statute. See Dkt. Nos. 24, 27, 29, 30, 34. Each motion has been fully briefed. See Dkt. Nos. 36, 37, 38, 39, 40, 41.

II. LEGAL STANDARD

A. Federal Rule of Civil Procedure 12(b)(1)

Under Rule 12(b)(1), a party may file a motion to dismiss for lack of subject matter jurisdiction. A Rule 12(b)(1) motion may be either facial or factual. Wolfe v. Strankman, 392 F.3d 358, 362 (9th Cir. 2004). A facial 12(b)(1) motion involves an inquiry confined to the allegations in the complaint, whereas a factual 12(b)(1) motion permits the court to look beyond the complaint to extrinsic evidence. Id . When a defendant makes a facial challenge, all material allegations in the complaint are assumed true, and the court must determine whether lack of federal jurisdiction appears from the face of the complaint itself. Id.

Federal courts are courts of limited jurisdiction, adjudicating only cases which the Constitution and Congress authorize. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). "A party invoking the federal court's jurisdiction has the burden of proving the actual existence of subject matter jurisdiction." Thompson v. McCombe, 99 F.3d 352, 353 (9th Cir. 1996). If a court determines that it lacks subject matter jurisdiction, the court must dismiss the action. Fed.R.Civ.P. 12(h)(3).

B. Federal Rule of Civil Procedure 12(b)(2)

Under Rule 12(b)(2), a defendant may move for dismissal based on lack of personal jurisdiction. Two independent limitations may restrict a court's power to exercise personal jurisdiction over a nonresident defendant: the applicable state personal jurisdiction rule and constitutional principles of due process. Sher v. Johnson, 911 F.2d 1357, 1360 (9th Cir. 1990). California's statutory limitation is co-extensive with the outer limits of due process. See id. at 1361; Cal. Civ. Proc. Code § 410.10. Accordingly, the federal and state jurisdictional inquiries merge into a single analysis. See Rano v. Sipa Press, Inc., 987 F.2d 580, 587 (9th Cir. 1993).

Due process permits the exercise of jurisdiction if a court has either general or specific jurisdiction over a nonresident defendant. See Sher, 911 F.2d at 1361. "General jurisdiction applies where a defendant's activities in the state are substantial' or continuous and systematic, ' even if the cause of action is unrelated to those activities." Id . "Where general jurisdiction is inappropriate, a court may still exercise specific jurisdiction if the ...


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