United States District Court, S.D. California
WILLIAM PELLEGRINI, individually and on behalf of others similarly situated, Plaintiff,
HUYSSEN, INCORPORATED, a California corporation, bda SEDONA STAFFING; TEMPRO, INC., a Delaware corporation; L.A. LEASING, INC., an Illinois corporation; and DOES 3 through 100, inclusive, Defendants.
ORDER ON MOTIONS TO DISMISS [Doc. Nos. 9, 10,
Cathy Ann Bencivengo United States District Judge
This matter comes before the Court on Defendant Huyssen
Incorporated's (“Huyssen') motion to dismiss
[Doc. No. 9], Defendant L.A. Leasing, Inc.'s (“L.A.
Leasing”) motion to dismiss [Doc. No. 10], and
Defendant TemPro Services, Inc.'s (“TemPro”)
motion to dismiss [Doc No. 11]. The motions have been fully
briefed, and the Court finds them suitable for determination
on the papers submitted and without oral arguments in
accordance with Civil Local Rule 7.1(d)(1). For the following
reasons, Defendants' motions are granted in part and
denied in part.
1, 2016, Plaintiff brought suit in the Superior Court of the
State of California (“the State Court Action”)
against Defendant Huyssen asserting for wage and hour claims
in violation of the California Labor Code, the Code of
Regulations, Industrial Wage Commission (“IWC”)
and California's Unfair Competition Law
(“UCL”). Cal Bus. & Prof Code § 17200,
et seq.; Civil Code § 3428. [Doc No.
August 10, 2016, Plaintiff filed a First Amended Complaint
(“FAC”) in the State Court Action alleging
similar wage and hour claims in violation of California law.
[Doc. No. 1-3.] On September 14, 2016, Huyssen filed its
Answer to the FAC. [Doc. NO. 1-4.]
November 11, 2016, Plaintiff filed amended the FAC to name
TemPro Services, Inc. (“TemPro”) and L.A. Leasing
as Defendants. [Doc. No. 1-5.] On December 20, 2016,
Plaintiff filed a Motion for Leave to Amend the FAC [Doc. No.
1-7] that was opposed by Huyssen [Doc. No. 1-9] and
ultimately granted by the Superior Court [Doc. No. 1-11].
Second Amended Complaint (“SAC”) was filed on
January 13, 2017. [Doc. No. 1-12.] The SAC asserts that
Defendants failed to compensate their employees as required
by federal and California law and includes a Fair Labor
Standards Act (“FLSA”) claim. Specifically, the
SAC alleges Defendants Huyssen, L.A. Leasing and TemPro
jointly operate a staffing company that operates under the
name Sedona Staffing and/or Sedona Group. [Doc. No. 1-12
¶ 1.] It alleged Defendants retained Plaintiff as an
employee and required him, and others similarly situated, to
comply with Defendants' uniform policies to attend and
participate in meetings and telephonic communications
relating to prospective assignments to Defendants clients,
consult with Defendants regarding the status of assignments,
provide availability to work information to Defendants,
attend client and internal company interviews and
orientations, and undertake training and travel without
receiving any compensation for these activities. [Doc. No.
1-12 ¶¶ 3-4, 23, 25-30.]
January 25, 2017, Defendants Huyssen and L.A. Leasing removed
the action to this Court pursuant to 28 U.S.C. §§
1441(a) and 1446(a). [Doc. No. 1.] On February 13, 2017,
Defendants filed three separate motions to dismiss [Doc. Nos.
9, 10, 11.] All Defendants seek dismissal pursuant to Federal
Rule of Civil Procedure 12(b)(6), with Defendant TemPro also
seeking to dismiss for lack of personal jurisdiction pursuant
to Rule 12(b)(2). On February 16, 2017, Plaintiff filed a
combined opposition to Huyssen and L.A. Leasing's motions
to dismiss [Doc. No. 16] and a separate response in
opposition to TemPro's motion [Doc. No. 17.]. Defendants
filed their replies. [Doc. Nos. 20, 21, 22.] In light of the
commonality of arguments in the motions to dismiss, the Court
will consider them together.
Rule of Civil Procedure 12(b)(2) allows a district court to
dismiss an action for lack of personal jurisdiction.
“Where defendants move to dismiss a complaint for lack
of personal jurisdiction, plaintiffs bear the burden of
demonstrating that jurisdiction is appropriate.”
Dole Foods Co. Inc. v. Watts, 303 F.3d 1104, 1108
(9th Cir. 2002). “The court may consider evidence
presented in affidavits to assist in its determination and
may order discovery on the jurisdictional issues.”
Doe v. Unocal Corp., 248 F.3d 915, 922 (9th Cir.
2011) (citing Data Disc, Inc. v. Sys. Tech. Ass'n,
Inc., 557 F.2d 1280 (9th Cir. 1977)).
both parties support their respective positions with
affidavits and the “district court acts on the
defendant's motion to dismiss without holding an
evidentiary hearing, the plaintiff need make only a prima
facie showing of jurisdictional facts to withstand a motion
to dismiss.” Id. (citing Ballard v.
Savage, 65 F.3d 1495, 1498 (9th Cir. 1995)). See
also Data Disc, 557 F.2d at 1285 (“if
Plaintiff's proof is limited to written materials, it is
necessary only for these materials to demonstrate facts which
support a finding of jurisdiction in order to avoid a motion
to dismiss.”). In other words
[plaintiff] need only demonstrate facts that if true would
support jurisdiction over the defendant. Unless directly
contravened, [plaintiff's] version of the facts is taken
as true, and conflicts between the facts contained in the
parties' affidavits must be resolved in [plaintiff's]
favor for purposes of deciding whether a prima facie case for
personal jurisdiction exists.
Harris Rutsky & Co. Ins. Servs., Inc. v. Bell &
Clements Ltd., 328 F.3d 1122, 1129 (9th Cir. 2003)
court's power to exercise personal jurisdiction over a
non-resident defendant is limited by two independent
constraints: the applicable state personal jurisdiction
statute and constitutional principles of due process.
Sher v. Johnson, 911 F.2d 1357, 1361 (9th Cir.
1990); see also In re W. States Wholesale Natural Gas
Antitrust Litig., 715 F.3d 716, 741 (9th Cir. 2013)
(“[p]ersonal jurisdiction over a nonresident defendant
is proper if permitted by a state's long-arm statute and
if the exercise of that jurisdiction does not violate federal
due process.”) “Under California's long-arm
statute, California state courts may exercise personal
jurisdiction ‘on any basis not inconsistent with the
Constitution of this state or of the United
States.'” Daimler AG v. Bauman, 134 S.Ct.
746, 753 (2014) (quoting Cal. Civ. Proc. Code Ann. §
410.10 (West 2004)).
the Due Process Clause of the Fourteenth Amendment, to
exercise personal jurisdiction over an out-of-state
defendant, the defendant must have “certain minimum
contacts with [the State] such that the maintenance of the
suit does not offend traditional notions of fair play and
substantial justice.” Goodyear Dunlop Tires
Operations, S.A. v. Brown, 564 U.S. 915, 923 (2011)
(quoting Int'l Shoe Co. v. Washington, 326 U.S.
310, 316 (1945) (internal quotations omitted)). This minimum
contacts jurisdiction may be either “general or
all-purpose jurisdiction, ” or “specific or
case-linked jurisdiction.” Id. at 919 (citing
Helicopteros Nacionales de Colombia S.A. v. Hall,
466 U.S. 408, 414 (1984)). “In order for a court to
exercise specific jurisdiction over a claim, there must be an
‘affiliation between the forum and the underlying
controversy, principally, [an] activity or an occurrence that
takes place in the forum State.'” Bristol-Myers
Squibb Co. v. Superior Court of Cal., S.F. Cnty., 137
S.Ct. 1773, 1781 (2017) (quoting Goodyear, 564 U.S.
Rule 12(b)(6), a party may bring a motion to dismiss based on
the failure to state a claim upon which relief may be
granted. A Rule 12(b)(6) motion challenges the sufficiency of
a complaint as failing to allege “enough facts to state
a claim to relief that is plausible on its face.”
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570
(2007). For purposes of ruling on a Rule 12(b)(6) motion, the
court “accept[s] factual allegations in the complaint
as true and construe[s] the pleadings in the light most
favorable to the non-moving party.” Manzarek v. St.
Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031
(9th Cir. 2008). But, a “pleading that offers
‘labels and conclusions' or ‘a formulaic
recitation of the elements of a cause of action will not
do.'” Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009) (quoting Twombly, 550 U.S. at 555).
TemPro's Motion to Dismiss Pursuant to Rule
TemPro moves to dismiss for lack of either specific or
general personal jurisdiction because it does not conduct or
solicit any business in the State of California. [Doc. No. 11
at 12-13.] Plaintiff does not dispute that TemPro lacks
sufficient contacts with California to support general
jurisdiction, but asserts that TemPro operates in California
as Sedona Staffing and the Sedona Group and is therefore
subject to specific personal jurisdiction. [Doc. No. 17 at
10-13.] In the alternative, Plaintiff argues that L.A.
Leasing and Huyssen's contacts related to the San Diego
branch should be imputed to TemPro. [Doc. No. 17 at 13-18.]
Since Plaintiff has effectively conceded that general
jurisdiction does not exist, the Court will limit its inquiry
to whether it has specific jurisdiction over TemPro.
jurisdiction is confined to adjudication of ‘issues
deriving from, or connected with, the very controversy that
establishes jurisdiction.'” Goodyear
Dunlop, 564 U.S. at 919. See also Daimler AG,
134 S.Ct. at 758 (the focus is on the “relationship
among the defendant, the forum, and the litigation.”).
“When there is no such connection, specific
jurisdiction is lacking regardless of the extent of a
defendant's unconnected activities in the State.”
Bristol-Myers Squibb, 137 S.Ct. at 1781. The Ninth
Circuit uses a three-prong test to determine whether a
non-resident defendant is subject to specific personal
jurisdiction: (1) [t]he 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 laws; (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). The plaintiff bears the burden of
satisfying the first two requirements and if successfully
met, the “burden then shifts to the defendant to
‘present a compelling case' that the exercise of
jurisdiction would not be reasonable.” Id. at
TemPro is a Delaware corporation with its principal place of
business in Moline, Illinois. [Doc. No. 11-2 at ¶ 2.]
TemPro is wholly owned by John Enterprises Limited an
Illinois corporation. [Doc. No. 13.] TemPro asserts that with
one exception, TemPro has not had any California employees
since December 31, 2000. [Doc. No. 11-2 at ¶ 2.] TemPro
declares that it does not have any offices in California,
does not have any bank account in California, is not licensed
to do business in California, has no agent for service of
process in California, does not lease or own any real estate
in California, and does not have any contracts with any
businesses based in California. [Id. at ¶¶
6-11.] Further, TemPro attests that Plaintiff is not and
never has been employed by TemPro and that it does not have
any ownership interest in L.A. Leasing or Huyssen and L.A.
Leasing and Huyssen do not have an ownership interest in
TemPro. [Id. at ¶¶ 5, 12.]
opposition, Plaintiff alleges that jurisdiction exists in
California because TemPro operates in California as Sedona
Staffing and the Sedona Group. Plaintiff asserts that
specific jurisdiction is warranted because (1) through these
entities TemPro purposefully avails itself in California by
openly recruiting agents online and maintaining a staffing
office in San Diego; (2) the action arises out of
TemPro's activities in California because Plaintiff's
claims are derived from his employment relationship with the
Sedona Group that was formed in the San Diego branch office;
and (3) exercise of jurisdiction over TemPro would be
reasonable. [Doc. No. 17 at 10-13.] Defendant TemPro
summarily dismisses Plaintiff's argument that The Sedona
Group and TemPro are one and the same, asserting that the
absence of any Secretary of State Corporate Documents is
evidence that The Sedona Group is not a corporate entity.
support of his argument, Plaintiff offers a declaration by
Lacy Wells, an associate with the law firm of Nicholas &
Tomasevic, LLP, counsel of record for Plaintiff, and a number
of accompanying exhibits. [Doc. No. 17-5 at ¶ 1.] Plaintiff
posits that the exhibits demonstrate that: (1) TemPro's
principal place of business is at 612 Valley View Drive,
Moline, IL; (2) the Sedona Compass website is registered at
the same mailing address as TemPro; (3) a billboard
identifying the Sedona Group is located at the 612 Valley
View Drive address; (4) Rick John is the President of the
Sedona Group and TemPro; (5) Ms. Kahley's Linked In
profile indicates that she is the “Director of
Operations at The Sedona Group”; (5) In 1986 TemPro was
formed by the Willard Brothers, which eventually becomes The
Sedona Group, encompassing three divisions - Sedona Staffing
Services, Sedona Technologies and Sedona Medical; (6) In
1998, TemPro rebrands as Sedona Staffing Services.
availment analysis examines whether the defendant's
contacts with the forum are attributable to his own actions
or are solely the actions of the plaintiff.”
Sinatra v. National Enquirer, 854 F.2d 1191, 1195
(9th Cir. 1988). To successfully demonstrate this, Plaintiff
must show that TemPro “engage[d] in some form of
affirmative conduct allowing or promoting the transaction of
business within the forum state.” Gray & Co. v.
Firstenberg Machinery Co., 913 F.2d 758, 760 (9th Cir.
1990) (citation omitted). In contract cases the inquiry
typically focuses on “whether a defendant
‘purposefully avails itself of the privilege of
conducting activities' or ‘consummates a
transaction' in the forum, focusing on activities such as
delivering goods or executing a contract.” Yahoo!
Inc. v. La Ligue Contre Le Racisme Et
L'Antisemitisme, 433 F.3d 1199, at 1206 (9th Cir.
2006) (citing Schwarzenegger, 374 F.3d at 802).
complaint alleges that TemPro dba Sedona Staffing and/or
Sedona Group along with the other Defendants, jointly
operates a staffing company that failed to compensate their
employees, including Plaintiff, as required by federal and
California law. [Doc. No. 1-12 ¶ 1.] Further, Plaintiff
alleges that TemPro, operating as The Sedona Group, openly
recruits agents like Huyssen to open up new staffing office
locations on its website. [See Doc. No. 17-5 at
¶ 8 and Ex. J.] Additionally, Plaintiff argues that
TemPro's purposeful availment is demonstrated though the
websites of The Sedona Group and Sedona Staffing Corporate.
Plaintiff contends that links on The Sedona Group website
transfer users to the website of Sedona Staffing Corporate
and users can select office locations from the Sedona
Staffing Corporate Site. [See Id. at ¶ 9, Exs.
K, L, M.] According to Plaintiff, the Clairemont Mesa Blvd
Location listed as an office location on the Sedona Staffing
Corporate website is where Plaintiff visited and was hired.
[See Id. at ¶ 9, Exs. K, L, M; Doc. No. 17-1 at
¶ 2, Ex. A.] Plaintiff also asserts that San Diego and
Carlsbad, two separate California locations, are listed on
the Sedona Staffing Corporate's website. [See
Wells Decl. ¶ 9.] In response, Defendant TemPro states
“Plaintiff's mantra throughout his Response that
‘TemPro operates as the Sedona Group' is conclusory
unsupported by the facts, and does not make it so.”
[Doc. No. 22 at 7:3-4.] The Court disagrees. Plaintiff has
submitted an affidavit and accompanying exhibits that allege
that TemPro operates as The Sedona Group and Sedona Staffing,
that The Sedona Group and Sedona Staffing have offices in
California though which Plaintiff, a California resident,
sought temporary employment, and The Sedona Group recruits
partners within California. Moreover, in deciding whether
Plaintiff has established his prima facie case for personal
jurisdiction, the Court resolves conflicts between facts
contained in the parties' affidavits in Plaintiff's
favor. Harris Rutsky, 328 F.3d at 1129. Accordingly,
the Court finds that TemPro, operating as Sedona Staffing and
The Sedona Group, purposefully avails itself of the privilege
of conducting business in California.
Relatedness of the Claim and Contacts
second prong of the Schwarzenegger analysis requires
the court to determine whether the claim arises from the
defendant's forum-related activities. See
Schwarzenegger, 374 F.3d at 801-802. Courts make this
determination by “apply[ing] a but for test.”
See Menken v. Emm, 503 F.3d 1050, 1058 (9th Cir.
2007) (plaintiff would not have suffered an injury “but
for” defendant's forum-related conduct).
Court concludes that but for TemPro's, operating as The
Sedona Group and/or Sedona Staffing, contacts with California
Plaintiff's claims against it would not have arisen.
Plaintiff's claims arise out of an employment
relationship that was allegedly formed in The Sedona
Group's San Diego branch office. [Doc. No. 17-1 at ¶
9; Doc. No. 17-5 at¶ 9, Ex. M.] Furthermore, it is
alleged that The Sedona Group owns the Sedona Compass website
that catalogs temporary workers' information, including
Plaintiff's, in California. [Wells Decl. ¶¶ 2,
4, Exs. F, M.] Given that Defendant TemPro does not dispute
this, the Court concludes that Plaintiff has carried his
burden on the issue. See Harris Rutsky, 328 F.3d at
third part of the Schwarzenegger test requires a
broad inquiry into the overall reasonableness and fairness of
exercising personal jurisdiction. Schwarzenegger,
374 F.3d at 801-802. The burden is on defendants to
“present a compelling case” that exercising
personal jurisdiction over it would be unreasonable.
Burger King, 471 U.S. at 476-78. In making this
inquiry the court considers: (1) the extent of purposeful
interjection into the forum state; (2) the burden on the
defendant of defending in the forum; (3) the extent of
conflict with the sovereignty of defendant's state; (4)
the forum state's interest in adjudicating the dispute;
(5) the most efficient judicial resolution of the
controversy; (6) the ...