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Haake v. Strudwick

United States District Court, D. Idaho

December 1, 2014

DEBBY HAAKE, an individual, and ROBERT HAAKE, an individual, Plaintiffs,
v.
BARRY STRUDWICK, an individual, and GRUPO DEL PACIFICO DEVELOPMENT VENTURE S.A., a Costa Rican company, Defendants

For Debby Haake, Robert Haake, Plaintiffs: Allison M Blackman, Vaughn Fisher, LEAD ATTORNEYS, Fisher Rainey Hudson, Boise, ID.

For Barry Strudwick, Grupo Del Pacifico Development Venture S.A., a Costa Rican company, Defendants: Kevin J Scanlan, LEAD ATTORNEY, Kevin Alan Griffiths, Duke Scanlan & Hall, PLLC, Boise, ID.

MEMORANDUM DECISION AND ORDER

Honorable Candy W. Dale, United States Magistrate Judge.

The Court has before it the Motion to Dismiss filed by Defendants Barry Strudwick and Grupo Del Pacifico Development Venture S.A. (Dkt. 5). Defendants argue this case should be dismissed under Federal Rule of Civil Procedure 12(b)(2). Specifically, Defendants claim they lack sufficient contacts with Idaho, and thus the Court cannot exercise specific personal jurisdiction over them consistent with the Due Process Clause of the Fourteenth Amendment. For the reasons explained below, the Court will deny Defendants' motion.

BACKGROUND[1]

Plaintiffs Debby and Robert Haake are residents of Idaho, having moved to Idaho from Illinois in January of 2009. Defendant Barry Strudwick is President and general agent of Defendant Grupo Del Pacifico Development Venture S.A. Strudwick is a resident of Maryland; Grupo Del Pacifico is a company incorporated under the laws of and with its principle place of business in Costa Rica. For purposes of this motion only, the Court accepts the Haakes' allegation that Strudwick uses Grupo Del Pacifico as his alter ego notwithstanding Strudwick's claim to the contrary.

This action arises out of Defendants' alleged breach of their contractual obligation to complete construction of a residential condominium--known as Casa Palma--for the Haakes in Esterillos Este, Puntarenas, Costa Rica. On April 15, 2010, the parties executed the Purchase and Construction Agreement (" the Agreement") related to the condominium. (Agreement, Dkt. 1-1.) Under the Agreement, the Haakes promised to make an " initial cash payment" of $150, 000 by wire transfer to a bank account held by Grupo Del Pacifico in Maryland. (Id. ¶ 6(A).) The Agreement also contemplates a series of periodic $150, 000 construction payments culminating in a $250, 000 payment at closing, as well as payments for costs and expenses incurred after construction is substantially complete. (Id. ¶ ¶ 6(B)--(C), (F).) The Agreement also includes a change order procedure whereby the parties can make mutually agreeable modifications to the planned construction. (Id. ¶ 12.)

On or about April 15, 2010, the Haakes wired the $150, 000 initial cash payment from their Idaho bank account to Grupo Del Pacifico's account in Maryland. Although Defendants received the payment, Casa Palma remains in virtually the same unfinished condition as it was before the parties executed the Agreement.

The Haakes filed suit on May 30, 2014, seeking to recover the initial cash payment, pre- and post-judgment interest, and attorney fees and costs. Premising subject matter jurisdiction on diversity of citizenship, the Haakes assert four state-law causes of action: (1) breach of the Agreement, (2) fraudulent misrepresentation of intent to perform under the Agreement, (3) conversion and civil theft, and (4) unjust enrichment.

On July 11, 2014, Defendants filed a motion to dismiss for lack of personal jurisdiction under Rule 12(b)(2). Defendants argue their contacts with Idaho are incidental to the parties' ongoing business relationship, which predates the Haakes' unilateral decision to move to Idaho from Illinois. This fortuitous connection to Idaho, Defendants argue, renders personal jurisdiction by an Idaho court incompatible with due process principles. The Haakes respond that Defendants have sufficient contacts with Idaho to establish personal jurisdiction. Specifically, the Haakes note that Strudwick repeatedly pitched Casa Palma in phone calls and emails to them while at their Boise, Idaho residence. The Haakes also emphasize that the Agreement for the purchase and construction of Casa Palma expressly recites their Boise, Idaho address. Moreover, the funds for the initial cash payment were drawn from the Haakes' Idaho bank account. This combination of contacts, the Haakes argue, allows the Court to exercise personal jurisdiction consistent with due process.

It is undisputed that Defendants' only contacts with Idaho relate to negotiation and formation of the Agreement. Grupo Del Pacifico has no offices, has no employees, and does not pay income taxes in Idaho. Likewise, Strudwick has no agents, employees, or property in Idaho.

The parties have consented in writing to the jurisdiction of a United States Magistrate Judge pursuant to 28 U.S.C. § 636(c). (Dkt. 11.) The Court heard the parties' oral arguments on Defendants' motion to dismiss on November 24, 2014, and now issues the following decision.

LEGAL STANDARDS

Faced with Defendants' motion to dismiss under Rule 12(b)(2), the Haakes have the burden of proving personal jurisdiction is appropriate. Boschetto v. Hansing, 539 F.3d 1011, 1015 (9th Cir. 2008). Where, as here, Defendants' motion is based on written materials rather than an evidentiary hearing, the Haakes need establish only a prima facie showing of jurisdictional facts to avoid dismissal. See Ballard v. Savage, 65 F.3d 1495, 1498 (9th Cir. 1995).

The Court must take the Haakes' uncontroverted allegations as true and resolve in their favor any conflicts between the parties over statements in the affidavits. See Dole Food Co. v. Watts, 303 F.3d 1104, 1108 (9th Cir. 2002). However, where Defendants offer evidence in support of their motion, the Haakes may not simply rest on the bare allegations of their complaint. See Amba Marketing Systems, Inc. v. Jobar International, Inc.., 551 F.2d 784, 787 (9th Cir. 1977). Instead, the ...


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