United States District Court, N.D. California
ORDER GRANTING MOTION TO DISMISS RE: DKT. NO.
CHHABRIA United States District Judge
this case, 42 plaintiffs bring claims arising from purchases
of timeshares across the country. Wyndham Vacation Ownership,
Wyndham Destination Network, and RCI have moved to dismiss
most of the claims for lack of personal jurisdiction.
Fed.R.Civ.P. 12(b)(2). The plaintiffs ground the
defendants' amenability to suit in California on both
general and specific personal jurisdiction. This Court has
personal jurisdiction over the defendants to the extent that
a California state court would. Fed.R.Civ.P. 4(k)(1)(A).
jurisdiction permits a court to hear any and all claims
against a defendant, regardless of the connection of the
claims to the forum state. Goodyear Dunlop Tires
Operations, S.A. v. Brown, 564 U.S. 915, 919 (2011). A
corporation is typically subject to general jurisdiction only
in its state of incorporation and the state of its principal
place of business. Daimler AG v. Bauman, 571 U.S.
117, 137 (2014).
the defendants is amenable to general jurisdiction only in
Delaware and Florida. Wyndham Vacation Ownership, Wyndham
Destination Network, and RCI are formed under Delaware law
and have their principal places of business in Florida. Davis
Decl. ¶¶ 4-6, Dkt. No. 8-1. In an
“exceptional case, ” an entity's operations
could be “so continuous and systematic as to render it
essentially at home in the forum State.”
Daimler, 571 U.S. at 138-39 & n.19 (internal
quotation marks and brackets omitted). But the plaintiffs
have not demonstrated that any of the defendants are
functionally at home in California. Nor does Wyndham's
appointment of an instate agent for service of process
constitute consent to general jurisdiction in California
courts. Bristol-Myers Squibb Co. v. Superior Court,
1 Cal. 5th 783, 798 (2016), rev'd on other
grounds, 137 S.Ct. 1773 (2017); see King v. American
Family Mutual Insurance Co., 632 F.3d 570, 576 (9th Cir.
2011) (holding that state law, within constitutional limits,
“determine[s] whether a foreign corporation is subject
to personal jurisdiction in a given case because the
corporation has appointed an agent for service of
jurisdiction extends to controversies that “arise out
of or relate to the defendant's contacts with the
forum.” Bristol-Myers Squibb, 137
S.Ct. at 1780 (internal quotation marks and brackets
omitted). As the Supreme Court has explained, this type of
personal jurisdiction doesn't exist absent a connection
between the forum state and the defendant's conduct that
gave rise to the plaintiffs' claims, “regardless of
the extent of a defendant's unconnected activities in the
State.” Id. at 1781.
the claims do not satisfy the test for specific jurisdiction.
The wrongful conduct alleged in this case is the
defendants' use of coercive negotiating tactics to secure
unconscionable terms for timeshares. Under the holding of
Bristol-Myers Squibb, the requisite connection to
California is not present for plaintiffs who entered into
contracts outside of California to purchase a timeshare at a
non-California property. See also CollegeSource, Inc. v.
AcademyOne, Inc., 653 F.3d 1066, 1076 (9th Cir. 2011)
(explaining that “the claim must be one which arises
out of or relates to the defendant's forum-related
activities”). That rule applies even to California
residents who entered into contracts out of state; granting
that the California residents may have incurred financial
costs in California, the defendants' “relevant
conduct occurred entirely in” other states. Walden
v. Fiore, 571 U.S. 277, 289-91 (2014). According to the
complaint, California was the forum for only five contracts.
Complaint ¶ 2. Thus, absent additional facts, this Court
has the power to adjudicate only the claims related to those
plaintiffs' primary response is that the plaintiffs with
out-of-state claims are (in their words) “national
indispensable parties” whose shared experience will
corroborate the testimony of plaintiffs with in-state claims.
This argument appears to conflate personal jurisdiction with
joinder. See Fed. R. Civ. P. 19(a). But the fact
that a party might be indispensable for purposes of joinder
does not enlarge the court's power to adjudicate claims
outside its jurisdiction. See Hendricks v. Bank of
America, N.A., 408 F.3d 1127, 1135 (9th Cir. 2005). In
any event, the plaintiffs with out-of-state claims are
plainly not indispensable parties, for the remaining
plaintiffs can be granted complete relief in their absence
without prejudicing any party. See Fed. R. Civ. P.
motion to dismiss for lack of personal jurisdiction is
granted. The plaintiffs are given leave to amend the
complaint, assuming they can do so consistent with Federal
Rule of Civil Procedure 11, to reassert those claims that
satisfy these principles of personal jurisdiction.
defendants have also moved to dismiss the complaint for lack
of subject-matter jurisdiction. Fed.R.Civ.P. 12(b)(1). They
contend that the complaint does not allege that any of the
plaintiffs have placed more than $75, 000 in controversy. 28
U.S.C. § 1332(a). Each plaintiff must establish that his
or her own claims meet the jurisdictional threshold unless
those claims fall within the grant of supplemental
jurisdiction. Exxon Mobil Corp. v. Allapattah Services,
Inc., 545 U.S. 546, 554-55, 559 (2005); see 28
U.S.C. § 1367(a). If the plaintiffs file an amended
complaint, they must state, in clearer terms, the amount in
controversy for each plaintiff and explain whether they are
relying on supplemental jurisdiction for any of the
Finally, the defendants contend that the plaintiffs have
failed to plead any claim on which relief could be granted.
Fed.R.Civ.P. 12(b)(6). Most of the plaintiffs' claims are
subject to the heightened pleading standard for claims that
sound in fraud. Fed.R.Civ.P. 9(b). The claims of negligent
misrepresentation are governed by the typical pleading
standard. Fed.R.Civ.P. 8(a). Whether judged under the greater
or lesser standard, the complaint falls far short. Much of
the complaint is incomprehensible, and the plaintiffs did not
plead facts sufficient to place the defendants on notice of
what wrongdoing is alleged (and by which entity). Nor does
the complaint state “the who, what, when, where, and
how of the misconduct charged” by the fraud-based
claims. Ebeid ex rel. United States v. Lungwitz, 616
F.3d 993, 998 (9th Cir. 2010).
reasons set forth above, the complaint is dismissed in its
entirety, with leave to amend. Any amended complaint must be
filed within 21 days of this order. Should these plaintiffs
decide to file an amended complaint, they should take note of
two additional points. First, Wyndham Destination Network
cannot be named a defendant out of mere prudence; the
plaintiffs must allege some ground for relief against each of
the defendants. Second, the timeshare is not a security if,
as the complaint alleges, the plaintiffs were
“motivated by a desire to use or consume the item
purchased.” United Housing Foundation, Inc. v.
Forman, 421 U.S. 837, 852-53 (1975). The plaintiffs must
instead plausibly plead that “money [was] invested in a
common enterprise with profits anticipated by virtue of
others' work.” Salameh v. Tarsadia Hotel,
726 F.3d 1124, 1130 (9th Cir. 2013). If the plaintiffs have a
good-faith basis for reasserting their securities-law claims,
they should seek to remedy this apparent deficiency.
IS SO ORDERED.