United States District Court, W.D. Virginia, Roanoke Division
Hon. Michael F. Urbanski United States District Judge
This is an action for breach of contract and quantum meruit brought by plaintiff Brian Wishneff & Associates ("Wishneff") against 10 South Street Associates, LLC ("10 South Street") arising out of an agreement to perform tax credit consulting services for a real estate development project in New York City. Presently pending before the court is 10 South Street's motion to dismiss for lack of personal jurisdiction.
When a court considers "a question of personal jurisdiction based on the contents of a complaint and supporting affidavits, the plaintiff has the burden of making a prima facie showing in support of its assertion of jurisdiction." Universal Leather. TIC v. Koro AR. S.A., 773 F.3d 553, 558 (4th Or. 2014) (citing Consulting Eng'rs Corp. v. Geometric Ltd.. 561 F.3d 273, 276 (4th Cir. 2009)). In determining if a plaintiff has met this burden, a court "must construe all relevant pleading allegations in the light most favorable to the plaintiff, assume credibility, and draw the most favorable inferences for the existence of jurisdiction." Id. (quoting Combs v. Bakker, 886 F.2d 673, 676 (4th Cir. 1989)).
When viewed in this light, the facts of this case support the exercise of personal jurisdiction over 10 South Street. 10 South Street entered into a contract it knew would be performed by Wishneff in Virginia and engaged in hundreds of communications relating to the contract with Wishneff in Virginia over a period of years. Accordingly, the motion to dismiss for lack of personal jurisdiction (ECF No. 19) will be DENIED.
A federal court may exercise personal jurisdiction if two conditions are satisfied. First, the state's long-arm statute must provide for jurisdiction in the circumstances presented. Second, the exercise of jurisdiction must be consistent with the Due Process Clause of the Fourteenth Amendment. Ellicott Mach. Corp.. Inc. v. John Holland Party. Ltd.. 995 F.2d 474, 477 (4th Cir. 1993). The Fourth Circuit has interpreted Virginia's long-arm statute, Virginia Code § 8.01-328.1, as being coextensive with the Due Process Clause. See English & Smith v. Metzger. 901 F.2d 36, 38 (4th Cir. 1990) (citing Peanut Corp. of Am. v. Hollywood Brands. Inc.. 696 F.2d 311, 313 (4th Cir. 1982)). Because Virginia's long-arm statute extends personal jurisdiction to the outer bounds of due process, the two-prong test collapses into a single inquiry when Virginia is the forum state.
Fairness is the touchstone of the jurisdictional inquiry, and the 'minimum contacts' test is premised on the concept that a corporation that enjoys the privilege of conducting business within a state bears the reciprocal obligation of answering to legal proceedings there. In the context of specific jurisdiction, the relevant conduct must have only such a connection with the forum state that it is fair for the defendant to defend itself in that state. We do more than formulaically count contacts, instead taking into account the qualitative nature of each of the defendant's connections to the forum state. In that vein, a single act by a defendant can be sufficient to satisfy the necessary quality and nature of such minimal contacts, although casual or isolated contacts are insufficient to trigger an obligation to litigate in the forum.
Tire Eng'g v. Shandong Linglong Rubber Co.. 682 F.3d 292, 301 (4th Cir. 2012) (internal quotations and citations omitted).
The question, then, is whether defendant has sufficient "minimum contacts with [Virginia] such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.'" Int'l Shoe Co. v. Washington. 326 U.S. 310, 316 (1945) (quoting Milliken v. Meyer. 311 U.S. 457, 463 (1940)). The "minimum contacts" test requites that defendants purposefully avail themselves of die forum state. Burger King Corp. v. Rudzewicz. 471 U.S. 462, 475 (1985). This test aims to ensure defendants are not "hauled into a jurisdiction solely as a result of random, fortuitous, or attenuated contacts, " id., and affords defendants protection "from having to defend [themselves] in a forum where [diey] should not have anticipated being sued." Consulting Eng'rs. 561 F.3d at 277 (citing World-Wide Volkswagen Corp. v. Woodson. 44 U.S. 286');">444 U.S. 286, 297 (1980)).
Determining the reach of judicial power over persons outside of a state's borders under the International Shoe standard is undertaken through consideration of two categories of personal jurisdiction-general and specific. Daimler AG v. Bauman. __ U.S.__, __, 134 S.Ct. 746, 754 (2014). General jurisdiction requires a substantial connection to the forum; the defendant's contacts with the forum must be so continuous and systematic as to render him essentially "at home." Id. at 754, 760 (citing Goodyear Dunlop Tires Operations. S.A. v. Brown.__U.S.__, __, 131 S.Ct. 2846, 2851-54 (2011)). Specific jurisdiction exists in a suit "arising out of or related to" the defendant's contacts with the forum. Id. at 754.
10 South Street is a Delaware limited liability company headquartered in New York City. One of its members is a resident of New York; the other is a resident of Florida. Wishneff is a Virginia limited liability company with its principal place of business in Roanoke, Virginia. Both of its members are Virginia residents.
On October 26, 2009, 10 South Street and Wishneff executed the Battery Maritime Building Historic Tax Credit Agreement ("Agreement"). ECF No. 28-4, Ex. C. The Agreement explains that 10 South Street was designated by the City of New York for potential renovation of the former Battery Maritime Building ("the Project") in Manhattan. Wishneff is obligated by the Agreement to manage the Project's tax credit process, including solicitation of financing from Historic Tax Credit ("HTC") investors. As compensation, Wishneff receives a portion of the financing it secures. The Agreement is governed by New York law and was consummated in New York.
Before entering the Agreement, Wishneff worked for Dermot Co., an entity related to 10 South Street. ECF No. 24-1, at ¶4. Brian Wishneff averred that "[a]s a result of Wishneff s work for Dermot, 10 South asked Wishneff whether Wishneff could assist 10 South in obtaining Historic Tax Credit incentives on the BMB [Battery Maritime Building] Project." ECF. No. 24-1, at ¶ 4. The parties first discussed the Project on January 18, 2008, when Brian Wishneff emailed an employee of 10 South Street, Kristin Neil, a copy of a news article about the Battery Maritime Building renovation and asked, "Is there a tax-credit opportunity here that could help bring additional equity to the deal?" ECF No. 28, Ex. A. On March 7, 2008, ...