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Hevar Systems, Inc. v. Lead It, Inc.

United States District Court, Fifth Circuit

January 15, 2014

HEVAR SYSTEMS, INC., Plaintiff,
v.
LEAD IT, INC., et al., Defendants.

MEMORANDUM OPINION AND ORDER

SIDNEY A. FITZWATER, Chief District Judge.

In this removed action, defendants Lead It, Inc. ("Lead") and Ram Talluri ("Talluri")-both Illinois citizens-move to dismiss for lack of in personam jurisdiction.[1] Plaintiff Hevar Systems Inc. ("Hevar") has not responded to the motion. For the reasons that follow, the court grants defendants' motion to dismiss for lack of in personam jurisdiction and dismisses this case without prejudice by judgment filed today.

I

Hevar sues Lead and Talluri to recover on claims of business disparagement, defamation, and libel per se. Hevar alleges that it entered into a subcontracting agreement with Lead under which Lead was to provide computer software and systems services to Hevar and its clients. It asserts that "Talluri acting individually and as an agent for [Lead] sent multiple libelous emails to multiple recipients in [Hevar's] business community... stat[ing] that [Hevar] did not have an office in the USA, that the Department of Homeland Security [was] looking for the owner, and that they never pay your money." Pet. ¶ 7 (second). Hevar alleges that these statements concerning its business were "patently false." Id. at ¶ 8.

On December 6, 2013 defendants filed the instant motion to dismiss. Hevar's response to the motion was due on December 27, 2013. See N.D. Tex. Civ. R. 7.1(e). Hevar has not responded to the motion, and it is now ripe for decision.[2]

II

A

The determination whether a federal district court has in personam jurisdiction over a nonresident defendant is bipartite. The court first decides whether the long-arm statute of the state in which it sits confers personal jurisdiction over the defendant. If it does, the court then resolves whether the exercise of jurisdiction is consistent with due process under the United States Constitution. See Mink v. AAAA Dev. LLC, 190 F.3d 333, 335 (5th Cir. 1999). Because the Texas long-arm statute extends to the limits of due process, the court need only consider whether exercising jurisdiction over Lead and Talluri would be consistent with the Due Process Clause of the Fourteenth Amendment. See id.; Alpine View Co. v. Atlas Copco AB, 205 F.3d 208, 214 (5th Cir. 2000).

The Due Process Clause of the Fourteenth Amendment permits the exercise of personal jurisdiction over a nonresident defendant when (1) that defendant has purposefully availed himself of the benefits and protections of the forum state by establishing "minimum contacts" with the forum state; and (2) the exercise of jurisdiction over that defendant does not offend "traditional notions of fair play and substantial justice." To comport with due process, the defendant's conduct in connection with the forum state must be such that he "should reasonably anticipate being haled into court" in the forum state.

Latshaw v. Johnston, 167 F.3d 208, 211 (5th Cir. 1999) (footnotes omitted). To determine whether exercising jurisdiction would satisfy traditional notions of fair play and substantial justice, the court examines (1) the defendant's burden, (2) the forum state's interests, (3) the plaintiff's interest in convenient and effective relief, (4) the judicial system's interest in efficient resolution of controversies, and (5) the states' shared interest in fundamental social policies. Ruston Gas Turbines, Inc. v. Donaldson Co., 9 F.3d 415, 421 (5th Cir. 1993).

A defendant's contacts with the forum may support either specific or general jurisdiction over the defendant. Mink, 190 F.3d at 336. "Specific jurisdiction exists when the nonresident defendant's contacts with the forum state arise from, or are directly related to, the cause of action. General jurisdiction exists when a defendant's contacts with the forum state are unrelated to the cause of action but are continuous and systematic.'" Id. (citations omitted).

"The district court usually resolves the jurisdictional issue without conducting a hearing." Ham v. La Cienega Music Co., 4 F.3d 413, 415 (5th Cir. 1993) (footnote omitted). "When a court rules on a motion to dismiss for lack of personal jurisdiction without holding an evidentiary hearing, it must accept as true the uncontroverted allegations in the complaint and resolve in favor of the plaintiff any factual conflicts posed by the affidavits. Therefore, in a no-hearing situation, a plaintiff satisfies his burden by presenting a prima facie case for personal jurisdiction." Latshaw, 167 F.3d at 211 (footnotes omitted).

B

In Hevar's state court petition, it pleads the predicate for the court's exercise of in ...


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