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Benjamin and Heather Echevarria, Husband and Wife, B&H Consulting Services, LLC v. James Piccolo and Real Estate Worldwide

February 16, 2012


The opinion of the court was delivered by: U. S. District Judge Honorable Edward J. Lodge


Pending before the Court in the above-entitled matter is James Piccolo's ("Piccolo"), Real Estate Worldwide, LLC's ("Worldwide") and Sonja Lee's ("Lee") (collectively referred to as "Defendants") Motion to Dismiss Verified Complaint Due To: Lack of Personal Jurisdiction or, in the Alternative Improper Venue and Forum NonConveniens (Dkt. 6). Having fully reviewed the record, the Court finds that the facts and legal arguments are adequately presented in the briefs and record. Accordingly, in the interest of avoiding further delay, and because the Court conclusively finds that the decisional process would not be significantly aided by oral argument, this matter shall be decided on the record before this Court without oral argument.


Plaintiffs Benjamin and Heather Echevarria (the "Echevarrias") are Idaho residents. The Echevarrias own B&H Consulting Services, L.L.C. ("B&H Consulting") which is an Idaho limited liability company. The Echevarrias and B&H Consulting are collectively referred to as "Plaintiffs." Defendant Worldwide, is an Arizona limited liability company with its principal place of business in Arizona. Plaintiffs allege Piccolo holds an interest in Worldwide via a Nevada limited liability company Piccolo set up called The Quan Project, LLC ("The Quan Project"). Plaintiffs allege, and Piccolo does not deny, that The Quan Project is controlled by Piccolo as the sole member/manager of the limited liability company. Piccolo and Lee are residents of Arizona. Lee has never traveled to Idaho and Piccolo traveled to Idaho once for a day or two about five years ago to make a speech.

Plaintiffs were associated with Piccolo through a franchise real estate and education company called Nouveau Riche for a period of seven years. In June 2009, Piccolo invited Plaintiffs to join him in financing a new limited liability company to provide specialized and sophisticated real estate investment training. Plaintiffs allege Piccolo said he would be a 50% owner and the Echevarrias would be 50% owners of the new limited liability company. The Echevarrias indicate they were contacted about the investment at their residence in Eagle, Idaho through telephonic and electronic means.

On August 29, 2009, Worldwide and Plaintiffs entered into an Agreement for Plaintiffs to acquire a membership interest in Worldwide. The written agreement was entered into in Arizona. In exchange for the 50% membership interest, Plaintiffs were to make a capital contribution of $500,000. Plaintiffs made the first deposit of $250,000 on August 31, 2009, but did not make the remaining $250,000 contribution. On November 9, 2009, Plaintiffs informed Worldwide that due to family concerns they could not proceed with the partnership with Worldwide.

On November 2, 2010, Defendant Worldwide filed a lawsuit in state court in Arizona against Plaintiffs alleging breach of contract and defamation. Plaintiffs filed their own action in federal court in the District of Idaho on December 27, 2010 (Dkt. 1) against Worldwide, Piccolo, Lee and The Quan Project. Plaintiffs allege breach of contract, fraud, concealment, conspiracy, breach of fiduciary duty and recission. Default has been entered against The Quan Project for failure to answer the Complaint. Dkt. 17. Defendants Worldwide, Piccolo and Lee filed their motion to dismiss for lack of jurisdiction or in the alternative improper venue and forum non-conveniens on April 20, 2011.

Without getting into the disputed details of the breach of contract claims, Defendants argue this Court does not have personal jurisdiction over Worldwide, Piccolo or Lee. The Defendants claim Worldwide has never conducted business in Idaho and has never made sales, solicited sales or engaged in any other business conduct in Idaho. In fact, Idaho is specifically not a territory in which Worldwide was attempting to provide its services. Piccolo claims he was physically in Idaho one day to make a speech unrelated to the current litigation and Lee claims she has never been to Idaho.

Plaintiffs acknowledge the agreement to purchase a membership interest was executed in Arizona, but respond that they received phone calls, text messages and emails from Piccolo and Lee in Idaho and used an Idaho bank to make the initial capital contribution to Worldwide and these acts are sufficient to establish personal jurisdiction over Defendants. The Echevarrias also claim they taught a class for the benefit of Defendants and Nouveau Riche in Idaho in 2010 and were paid $10,072 for their participation in the Idaho class by Piccolo. Plaintiffs claim Defendants collected $201,453 in proceeds from the Idaho class. Plaintiffs allege Piccolo (for himself and as an agent of Worldwide) made numerous false representations to them regarding returning their investment, transferring their interest, payment of commissions, payment of refund owed, etc. Plaintiffs also claim Piccolo and Lee took actions unilaterally and without proper authorization under Worldwide's Operating Agreement. Finally, Plaintiffs also submit the default entered against The Quan Project prevents transfer of the case to Arizona.


In a Rule 12(b)(2) motion to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of proof of demonstrating that jurisdiction is appropriate. Dole Food, Inc. v. Watts, 303 F.3d 1104, 1108 (9th Cir. 2002). The plaintiff "need only make a prima facie showing of jurisdictional facts." Sher v. Johnson, 911 F.2d 1357, 1361 (9th Cir. 1990). The Court must take the plaintiff's uncontroverted allegations as true and conflicts between the parties over statements in affidavits are resolved in plaintiff's favor. Dole Food, Inc. v. Watts, 303 F.3d 1104, 1108 (9th Cir. 2002).


1. Personal Jurisdiction

A. Idaho Law ...

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