United States District Court, C.D. California
LEVER YOUR BUSINESS, INC.
SACRED HOOPS & HARDWOOD. INC.
PRESENT THE HONORABLE CHRISTINA A. SNYDER JUDGE.
CIVIL MINUTES - GENERAL
(IN CHAMBERS) - DEFENDANT'S MOTION TO DISMISS (Dkt. [ 13
], filed October 8, 2019)
Lever Your Business, Inc. ("LYB") filed this action
against defendant Sacred Hoops & Hardwood, Inc.
("Sacred Hoops") on August 15, 2019. Dkt. 1
("Compl."). LYB asserts claims for breach of
contract, unfair competition, and conversion. See
id. According to LYB, Sacred Hoops breached an agreement
between the parties restricting the resale price of goods
that Sacred Hoops buys from LYB, refused to pay for or return
goods that it purchased from LYB, and engaged in unfair
competition by holding LYB responsible for its nonpayment.
October 8, 2019, Sacred Hoops filed a motion to dismiss. Dkt.
13 ("Motion"). On October 28, 2019, LYB filed an
opposition. Dkt. 18 ("Opp."). Sacred Hoops filed a
reply on November 4, 2019. Dkt. 19 ("Reply").
carefully considered the parties' arguments, the Court
finds and concludes as follows.
LYB is a California corporation with its principal place of
business in California. Compl. ¶ 1 LYB
"distributes] Italian based clothing, accessory, and
life style brand to companies (sellers) throughout the United
States." Id, ¶ 6. LYB manages distribution
for Hey Dude, an Italian-based shoe company. Id.
Sacred Hoops is a South Dakota corporation with its principal
place of business in South Dakota. Compl. ¶ 1; Motion at
4. Sacred Hoops does business as Top 10 Sports and sells
shoes, socks, and related accessories on its website and on
Amazon.com to consumers. Compl. ¶¶ 2-3; Motion at
February 2017, plaintiff and defendant entered into the
Minimum Advertising Pricing Policy ("MAP
Agreement"). Compl. at 7. The MAP Agreement provides, in
relevant part, that defendant, as a dealer, was required to
advertise Hey Dude products at or above a minimum advertised
price set by the MSRP in Hey Dude's catalog and order
form. Id. ¶ 8. The MAP Agreement also required
that defendant receive written authorization from Hey Dude
before selling Hey Dude products to a non-consumer third
alleges that, beginning in May 2018, defendant ordered and
received more than $ 116, 000 in Hey Dude inventory. Compl.
¶ 10. Plaintiff further alleges that defendant did not
object to or return any of the inventory, give notice that
any of the inventory was defective or not in compliance with
the order, and refused to pay for the inventory. Id.
Plaintiff contends that it has attempted to collect the
outstanding balance and that defendant continues to refuse to
pay the outstanding invoices. Id. ¶ 11.
Defendant contends, allegedly, that its obligations to pay
the outstanding Hey Dude invoices are relieved or offset
because plaintiff caused defendant to lose profits and sales.
Id ¶ 12.
plaintiff contends that, in 2018, defendant violated the MAP
Agreement by advertising Hey Dude products below the minimum
required price and by selling Hey Dude products on
unauthorized websites, including Walmart.com. Compl.
defendant moves to dismiss for lack of personal jurisdiction
under Federal Rule of Civil Procedure 12(b)(2), the “
plaintiff bears the burden of establishing that jurisdiction
is proper." Boschetto v. Hansing, 539 F.3d
1011, 1015 (9th Cir. 2008) (citation omitted). Where, as
here, the defendant's motion is based on written
materials rather than an evidentiary hearing, "the
plaintiff need only make a prima facie showing of
jurisdictional facts to withstand the motion to
dismiss." Brayton Purcell LLP v. Recordon &
Recordon, 606 F.3d 1124, 1127 (9th Cir. 2010) (quoting
Pebble Beach Co. v. Caddy, 453 F.3d 1151, 1154 (9th
Cir. 2006). The plaintiff cannot simply rely on the
"bare allegations" of its complaint; however,
uncontroverted allegations in the complaint must be taken as
true, and "[c]onflicts between parties over statements
contained in affidavits must be resolved in the plaintiffs
favor." Schwarzenegger v. Fred Martin Motor
Co., 374 F.3d 797, 800 (9th Cir. 2004).
personal jurisdiction exists if (1) it is permitted by the
forum state's long-arm statute and (2) the "exercise
of that jurisdiction does not violate federal due
process." Pebble Beach. 453 F.3d at 1154-55.
"California's long-arm statute is co-extensive with
federal standards, so a federal court may exercise personal
jurisdiction if doing so comports with federal constitutional
due process." Boschetto, 539 F.3d at 1015.
"For a court to exercise personal jurisdiction over a
nonresident defendant, that defendant must have at least
'minimum contacts' with the relevant forum such that
the exercise of jurisdiction 'does not offend traditional
notions of fair play and substantial justice.'"
Schwarzenegger. 374 F.3d at 801 (quoting
International Shoe Co. v. Washington, 326 U.S. 310,
316 (1945)). Depending on the nature of the contacts between
the defendant and the forum state, personal jurisdiction is
characterized as either general or specific.
court may assert general jurisdiction over foreign
(sister-state or foreign-country) corporations to hear any
and all claims against them when their affiliations with the
State are so 'continuous and systematic' as to render
them essentially at home in the forum State."
Goodyear Dunlop Tires Operations, S.A. v. Brown, 564
U.S. 915, 919 (2011) (quoting International Shoe,
326 U.S. at 317). A corporation's place of incorporation
and principal place of business are the paradigmatic bases
for general jurisdiction. Daimler AG v. Bauman, 571
U.S. 117, 137 (2014). Otherwise, "[t]he standard is met
only by 'continuous corporate operations within a state
[that are] thought so substantial and of such a nature as to
justify suit against [the defendant] on causes of action
arising from dealings entirely distinct from those
activities.'" King v. Am. Family Mut. Ins.
Co., 632 F.3d 570, 579 (9th Cir. 2011) (quoting
International Shoe, 326 U.S. at 318). The standard
for general jurisdiction "is an exacting standard, as it
should be, because a finding of general jurisdiction permits
a defendant to be haled into court in the forum state to
answer for any of its activities anywhere in the world."
Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d
1218, 1224 (9th Cir. 2011).
may assert specific jurisdiction over a claim for relief that
arises out of a defendant's forum-related activities.
Rano v. Sipa Press, Inc., 987 F.2d 580, 588 (9th
Cir. 1993). The test for specific personal jurisdiction has
(1) The defendant must perform an act or consummate a
transaction within the forum, purposefully availing himself
of the privilege of conducting activities in the forum and