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relying on Marin Tug to dismiss intentional interference with prospective economic relations claim because defendants could not be characterized as "strangers" to the business relationship
Summary of this case from United Nat'l Maint., Inc. v. San Diego Convention Ctr. Corp.Opinion
No. C 03-5145 MJJ.
November 4, 2004
ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS' 12(b)(6) MOTION TO DISMISS; DENYING DEFENDANT ESHER'S 12(b)(2) MOTION TO DISMISS
INTRODUCTION
Before the Court is a motion to dismiss pursuant to Federal Rules of Civil Procedure 12(b)(6) filed by Coe Newnes/McGahee ULC ("Coe Newnes"), the Coe Manufacturing Company, and Brian Esher ("Defendants"). Defendants seek to dismiss two causes of action from the First Amended Complaint ("Amended Complaint"): 1) breach of fiduciary duty; and 2) intentional interference with prospective economic advantage. Additionally, Defendant Esher moves to dismiss the Third, Fourth, and Fifth causes of action against him on the ground that the Court lacks personal jurisdiction over him under Federal Rule of Civil Procedure 12(b)(2). For the following reasons, the Court DENIES Defendants' 12(b)(6) Motion to Dismiss the breach of fiduciary duty claim with respect to Coe Newnes, and GRANTS the motion with leave to amend with respect to Coe Manufacturing and Esher. The Court GRANTS Defendants' 12(b)(6) Motion to Dismiss the intentional interference with prospective economic advantage claim with leave to amend. The Court DENIES Esher's 12(b)(2) Motion to Dismiss.
FACTUAL BACKGROUND
On June 29, 2001, Ronald McGehee and McGehee Development Company LLC ("Plaintiffs") entered into a written agreement ("the Agreement") with CAE McGahee, Inc. Pursuant to the Agreement, Plaintiffs provided Coe Newnes with product designs for Forest Industry Products and Equipment ("New Products"). Plaintiff Ronald McGahee was to personally perform the services for McGahee Co., except where the nature of the services to be performed did not require his knowledge or expertise. Plaintiffs agreed to assign all of their rights and interests in the intellectual property and patents arising from their work to Coe Newnes. In return, Coe Newnes agreed to compensate McGehee in two ways: 1) it was required to pay McGahee $375,000 per annum; and (b) it was required to pay McGahee a royalty based on the net sales of the New Products.
Defendant Coe Newnes assumed all of CAE McGahee's rights and obligations under the Agreement as part of a corporate acquisition in 2002. That entity will be referred to as Coe Newnes.
Pursuant to the Agreement, Plaintiffs allege they conceived of and designed the "McGahee Optimizing Planer," which optimizes the planing of rough-cut lumber into finished lumber. Plaintiffs allege that Defendant Brian Esher informed them to discontinue developing the planer because Coe Newnes's sister company, Coe Manufacturing, was already in the process of developing a similar product. Plaintiffs allege that contrary to Esher's representation, Coe Manufacturing had not designed or undertaken any development work on a product similar to Plaintiffs' planar. Plaintiffs assert that all of their inquiries to Defendants regarding the decision to cancel development of the planar were ignored. On or about May 20, 2003, Defendant Esher wrote to McGahee and gave notice of Coe Newnes' termination of the Agreement with Plaintiffs.
Plaintiffs commenced this action in state court on October 26, 2003, by filing a complaint requesting declaratory relief and asking the court to adjudicate the rights and obligations of Plaintiffs and Coe Newnes under the Agreement. Defendants subsequently removed the case to federal court. On September 8, 2004, Plaintiffs amended their Complaint to add four new claims: 1) breach of contract; 2) breach of fiduciary duty; 3) tortious interference with contract; and 4) tortious interference with prospective economic advantage. Plaintiffs also added two new Defendants, Coe Manufacturing and Brian Esher.
LEGAL STANDARD
A Rule 12(b)(6) motion to dismiss tests the legal sufficiency of the claims asserted in the complaint. See Cahill v. Liberty Mutual Ins. Co., 80 F.3d 336, 337 (9th Cir. 1996). Dismissal of an action pursuant to Rule 12(b)(6) is appropriate only where it "appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Levine v. Diamanthuset, Inc., 950 F.2d 1478, 1482 (9th Cir. 1991) (quoting Conley v. Gibson, 355 U.S. 41, 45-6 (1957)). In reviewing such a motion, the Court must assume all factual allegations to be true and must construe them in the light most favorable to the nonmoving party. See North Star v. Arizona Corp. Comm., 720 F.2d 578, 580 (9th Cir. 1983). The Court will dismiss the complaint or any claim in it without leave to amend only if "it is absolutely clear that the deficiencies of the complaint could not be cured by amendment." Noll v. Carlson, 809 F.2d 1446, 1448 (9th Cir. 1987).
In the context of a motion to dismiss, review is limited to the contents of the complaint. Allarcom Pay Television, Ltd. v. General Instrument Corp., 69 F.3d 381, 385 (9th Cir. 1995). However, matters properly presented to the court, such as those attached to the complaint and incorporated within its allegations, may be considered as part of the motion to dismiss. See Hal Roach Studios, Inc. v. Richard Feiner Co., 896 F.2d 1542, 1555 n. 19 (9th Cir. 1989).
Rule 12(b)(2) of the Federal Rules of Civil Procedure permits a defendant to move to dismiss a complaint for lack of personal jurisdiction. The plaintiff has the burden of proving that the Court has personal jurisdiction over the defendant. American Telephone Telegraph Co. v. Compagne Bruxelles Lambert, 94 F.3d 586, 588 (9th Cir. 1996). If the Court rules without holding an evidentiary hearing, dismissal for lack of personal jurisdiction is appropriate only if the plaintiff has not made a prima facie showing of personal jurisdiction. Id. In determining whether the plaintiff has met this burden, the uncontroverted allegations in the complaint must be taken as true, and conflicts between the facts contained in the parties' affidavits must be resolved in the plaintiff's favor. Id. at 588-89.
There are two limitations on the Court's power to exercise personal jurisdiction over a nonresident defendant: the applicable state or federal personal jurisdiction statute and constitutional principles of due process. Sher v. Johnson, 911 F.2d 1357, 1360 (9th Cir. 1990). Where, as here, there is no applicable federal statute governing personal jurisdiction, the law of the state in which the district sits applies. See Core-Vent Corp. v. Nobel Industries AB, 11 F.3d 1482, 1484 (9th Cir. 1993). As California's long-arm statute allows courts to exercise personal jurisdiction to the extent permitted by the Due Process Clause of the United States Constitution, the Court need only determine whether personal jurisdiction in this case would meet the requirements of due process. Id.; see Cal. Code Civ. Proc. § 410.10.
Federal due process requires that a nonresident defendant have minimum contacts with the forum state such that the exercise of personal jurisdiction does not offend traditional notions of fair play and substantial justice. Decker Coal Co. v. Commonwealth Edison Co., 805 F.2d 834, 838 (9th Cir. 1986) (citing International Shoe Co. v. Washington, 326 U.S. 310, 316 (1945)). The defendant's conduct and connection with the forum must be such that the defendant should reasonably anticipate being haled into court there. Sher, 911 F.2d at 1361 (citing World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297 (1980)).
The constitutional test may be satisfied in either of two ways: through general jurisdiction or specific jurisdiction. General jurisdiction exists if the nonresident's contacts with the forum are continuous and systematic and the exercise of jurisdiction satisfies traditional notions of fair play and substantial justice. Ziegler v. Indian River County, 64 F.3d 470, 473 (9th Cir. 1995) (quoting Reebok Int'l Ltd. v. McLaughlin, 49 F.3d 1387, 1391 (9th Cir. 1995)). If general jurisdiction exists, the Court has jurisdiction over the defendant even if the cause of action is unrelated to the defendant's forum activities. Omeluk v. Langsten Slip Batbyggeri A/S, 52 F.3d 267, 270 (9th Cir. 1995).
If general jurisdiction does not exist, the Court still may be able to assert specific jurisdiction over the defendant for a cause of action that arises out of the defendant's forum-related activities. Rano v. Sipa Press, Inc., 987 F.2d 580, 588 (9th Cir. 1993). The Court applies a three-part test in determining whether it may assert specific jurisdiction over the defendant: (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 invoking the benefits and protections of its laws; (2) the claim must arise out of or result from the defendant's forum-related activities; and (3) the exercise of jurisdiction must be reasonable. Id.
ANALYSIS
I. Motion to Dismiss Pursuant to Rule 12(b)(6)Defendants seek to dismiss two causes of action from the Amended Complaint: 1) breach of fiduciary duty; and 2) intentional interference with prospective economic advantage. The Court will discuss each issue separately.
A. Breach of Fiduciary Duty
California courts have defined a fiduciary relationship as follows:
A fiduciary relationship has been defined as any relation existing between parties to a transaction wherein one of the parties is duty bound to act with the utmost good faith for the benefit of the other party. Such a relation ordinarily arises where a confidence is reposed by one person in the integrity of another, and in such a relation the party in whom the confidence is reposed, if he voluntarily accepts or assumes to accept the confidence, can take no advantage from his acts relating to the interest of the other party without the latter's knowledge or consent.Hydro-Mill Co., Inc. v. Hayward, Tilton and Rolapp, 115 Cal. App. 4th 1145, 1146-47 (2004) (citation, internal quotation marks, and alterations omitted).
It is well-settled that parties to a contract do not by necessary implication become fiduciaries. See Wolf v. Superior Court, 107 Cal. App. 4th 25, 31 (2003) (stating that "every contract requires one party to repose an element of trust and confidence in the other to perform"). In the commercial context, typical examples of fiduciary relationships include "trustee/beneficiary, directors and majority shareholders of a corporation, business partners, joint adventures, and agent/principle." Id. at 30. "Inherent in each these relationships is the duty of undivided loyalty the fiduciary owes to its beneficiary, imposing on the fiduciary obligations far more stringent than those required of ordinary contractors. Id.
Plaintiffs allege that Coe Newnes owed a fiduciary duty to Plaintiffs because it promised in good faith, to evaluate, develop, market, and promote products presented to it for consideration. Plaintiffs contend that this promise was broken when Defendants conspired to halt the development of the McGahee Optimizing Planer.
Defendants argue that the breach of fiduciary duty claim against Coe Newnes fails as a matter of law because the allegations asserted in the Amended Complaint give rise only to a breach of contract claim. Furthermore, Defendants contend that Plaintiffs' claim against Coe Manufacturing and Esher for conspiracy to breach a fiduciary duty is not legally cognizable because neither Defendant owed an independent fiduciary duty to Plaintiffs.
After reviewing the Amended Complaint, the Court finds that Plaintiffs have adequately alleged that the Agreement created a fiduciary relationship between Plaintiffs and Coe Newnes. In City of Hope Nat. Medical Center v. Genentech, 2004 WL 2361763 (Cal.App. 2 Dist.), the court reaffirmed the general notion that the relationship between inventors and those they entrust their secrets to is "confidential or fiduciary in nature." 2004 WL 2361763, at *25; see also Stevens v. Marco, 147 Cal. App. 2d 357 (1956). The court stated that "there is every reason to afford the utmost protection to inventors who entrust their secrets to others for developing, patenting, manufacturing, and licensing the secrets in exchange for royalties. . . . To encourage inventors to disclose their ideas to third parties who can bring the ideas to the market place, those third parties should be held to the standards of a fiduciary." Id. at *27. Although Defendants have argued that the Agreement did not create a fiduciary relationship because Defendants retained discretion to develop all or none of Plaintiffs' inventions, City of Hope clearly dismissed this line of argument. The court stated as follows:
Plaintiffs' reliance upon Wolf is misplaced. Wolf did not involve the entrustment of secret ideas for patenting purposes, but rather involved the assignment of literary rights. 107 Cal. App. 4th at 228. According to City of Hope, "[t]his distinction is dispositive." 2004 WL 2361763 at *28.
For policy reasons, there should be no distinction between when a third party agrees to develop, patent and exploit an inventor's secret and when a third party is given that option and takes it. The inventor is still in the same position of trusting the third party regarding information and accountings. As well, the policy of encouraging public disclosure of inventions is better served by protecting both types of agreements. In reaching this conclusion, we remain mindful of [plaintiff's] trust, [defendant's] superior position, and the importance of encouraging public disclosure of life saving inventions in today's world. 2004 WL 2361763, at *29.
In light of City of Hope, there can be little doubt that Plaintiffs have adequately plead a breach of fiduciary duty against Coe Newness in the Amended Complaint. However, Coe Manufacturing and Esher cannot be liable for conspiring with Coe Newnes to breach fiduciary duties it owed Plaintiffs because they did not each owe independent duties to Plaintiffs. See 1-800 Contacts, Inc. v. Steinberg, 107 Cal. App. 4th 568, 590 (2003). Furthermore, while Plaintiffs' argue that Coe Manufacturing and Esher "aided and abetting a breach of fiduciary duty," Plaintiffs' Amended Complaint did not properly allege such activity. Therefore, the Court grants the motion to dismiss the breach of fiduciary duty claim against Coe Manufacturing and Esher. However, based upon the arguments of Plaintiffs' counsel, the Court finds that it is appropriate to grant Plaintiffs' leave to amend the claim. See Doe v. United States, 58 F.3d 494, 497 (9th Cir. 1995).
B. Interference with Prospective Economic Relations
(Against Coe Manufacturing and Esher)
Under California law, the following five elements must be established to support a cause of action for interference with prospective economic relations: "(1) the existence of a specific economic relationship between [plaintiff] and third parties that may economically benefit [plaintiff]; (2) knowledge by the [defendants] of this relationship; (3) intentional acts by the [defendants] designed to disrupt the relationship; (4) actual disruption of the relationship; and (5) damages to the [plaintiff]." Silicon Knights, Inc. v. Crystal Dynamics, Inc., 983 F.Supp. 1303, 1311 (N.D. Cal 1997) (citation omitted). In addition, a plaintiff must allege conduct that is "wrongful by some measure beyond the fact of the interference itself." Della Penna v. Toyota Motor Sales U.S.A., Inc., 11 Cal. 4th 376, 393 (1995) (internal quotation marks and citation omitted).
Defendants' argue that Plaintiffs' claim for intentional interference with prospective economic relations should be dismissed for two reasons. First, Defendants' contend that Plaintiffs have not alleged "wrongful conduct" as defined in Della Penna. Second, Defendants' contend that Plaintiffs have failed to allege the existence of any specific business relationships with the probability of future economic benefit that were affected by Defendants' actions.
Plaintiffs argue that "wrongful conduct" was properly plead in the Amended Complaint in the form of "interference with contract" and "aiding and abetting a breach of fiduciary duty." Plaintiffs also contend that they had multiple relationships with third parties with the probability of economic benefit to Plaintiffs.
Initially, the Court finds that Plaintiffs' have not adequately alleged "wrongful conduct." Plaintiffs' allegation of "interference with contract" does not constitute wrongful conduct "by some measure beyond the fact of the interference itself" within the meaning of Della Penna. Furthermore, while Plaintiffs' allegation of "aiding and abetting a breach of fiduciary duty" is legally cognizable, see Neilson v. Union Bank of California, 290 F.Supp. 2d 1101 (C.D. Cal. 2003), Plaintiffs have not properly plead the claim against Esher or Coe Manufacturing in the Amended Complaint.
In addition, the Court further finds that Plaintiffs have failed to properly plead "intentional interference with prospective economic relations" because Plaintiffs' allegations of future economic harm are too speculative. The Amended Complaint states that Plaintiffs prospective economic relationships were with:
a) Coe Newnes; and
b) Various probable customers for the McGahee Optimizing Planer, including but not limited to probable customers in California, probable customers to whom McGahee has sold forestry products and equipment in the past, and probable customers with whom McGahee has maintained business contacts and/or relationships and/or who are aware of and rely on McGehee's reputation in the market for creating and developing forest products and equipment.
With respect to the business relationships Plaintiffs had with "probable customers," the Court finds the pleading is severely lacking in detail. See Brown v. Allstate Ins. Co., 17 F.Supp. 2d 1134, 1139 (S.D. Cal. 1998) ("Plaintiff must establish an actual economic relationship or a protected expectancy with a third person, not merely a hope of future transactions.")
With respect to Plaintiffs' business relationship with "Coe Newnes," the Court finds that Plaintiffs' intentional interference with prospective economic relations claim fails because Coe Manufacturing and Esher were not "third-party stranger[s]" to that relationship. Marin Tug Barge, Inc. v. Westport Petroleum, Inc., 271 F.3d 825, 832 (9th Cir. 2001). It is well settled "that the core of intentional interference business torts is interference with an economic relationship by a third party stranger to that relationship, so that an entity with a direct interest or involvement in that relationship is not usually liable for harm caused by the pursuit of its interests." Id. Here, Coe Manufacturing and Esher cannot be characterized as "strangers" to the business relationship between Coe Newnes and Plaintiffs. The Court need not look further than the Amended Complaint to draw this conclusion. In the Amended Complaint, Plaintiffs allege that Esher "has been the Chief Executive Officer and/or Chairman of the Board of Directors of each Coe Newnes and Coe Mfg." Plaintiffs also allege their belief that "Coe Newnes and Coe Mfg. have a common (or closely allied) controlling owner or owners. . . ." And perhaps most telling, Plaintiffs allege that Coe Manufacturing, Esher, and Coe Newnes engaged in a conspiracy to interfere with McGehee's contract rights. Given the totality of these allegations, Plaintiffs' contention that Coe Manufacturing and Esher were "strangers" to the business contract between Coe Newnes and Plaintiffs is, at best, disingenuous.
Therefore, for the reasons set forth above, the Court grants Defendants' motion to dismiss the intentional interference with prospective economic relations claim against Coe Manufacturing and Esher. However, based on the moving papers and the arguments of Plaintiffs' counsel, the Court finds that leave to amend is in order. See Doe, 58 F.3d at 497.
II. Motion to Dismiss Pursuant to Rule 12(b)(2)
Defendant Esher seeks to dismiss the action against him arguing that he did not have the required "minimum contacts" with the state of California. Esher states that he has never resided or owned property in California. He also states that he has never traveled to California for business relating to Coe Newnes or Coe Manufacturing. He admits that he has spoken with McGahee on the phone, but those conversations were initiated almost entirely by McGahee. In any event, Esher argues that he was merely a "secondary participant" in the alleged wrongdoing and Coe Newnes was the "primary participant."
Plaintiffs maintain that the Court should exercise jurisdiction over Esher on the application of specific, rather than general, jurisdiction.
Plaintiffs contend that Esher's conduct was sufficient to satisfy the "minimum contacts" test. First, Plaintiffs argue that Esher committed several intentional torts against McGahee, and the effect of those torts were felt by McGahee in California. Second, Plaintiffs assert that Esher knew that McGahee was a resident of California. Third, Plaintiffs argue that Esher expressly aimed his intentional conduct at California.
As an initial matter, the Court finds Esher's argument that he was simply a "secondary participant" in the alleged wrongdoing against Plaintiffs to be unpersuasive. The Ninth Circuit has recognized that "[c]ases which found personal liability on the part of corporate officers have typically involved instances where the defendant was the `guiding spirit' behind the wrongful conduct . . . or the `central figure' in the challenged corporate activity." Davis v. Metro Productions, Inc., 885 F.2d 515, 524 (9th Cir. 1989). In such a scenario, "[e]ach defendant's contacts with the forum state must be assessed individually." Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 787 (1984).
Here, Plaintiffs' allegations regarding Esher's individual wrongdoing are unequivocal. Plaintiffs allege that Esher was the CEO and/or Chairman of the Board of both Coe Newnes and Coe Manufacturing. (Comp. ¶ 7.) Plaintiffs allege that Esher was in attendance during the March 19, 2000 meeting at which the McGahee Optimizing Planer was first introduced. (Comp. ¶ 27.) Plaintiffs allege that Esher originally showed great enthusiasm for the project. However, only two weeks after the presentation, Esher directed Ray Stevens to send an email to Plaintiffs ordering that all work on the McGahee Optimizing Planer be stopped. (Comp. ¶ 28.) Esher allegedly told McGahee that Coe Manufacturing had been working on a similar project for sometime and that the project was already being developed. And perhaps most importantly, Esher sent a letter to Plaintiffs giving notice of Coe Newnes' termination of the contract. (Comp. ¶ 33.) In sum, Plaintiffs allegations label Esher as not only the CEO of Coe Newnes and Coe Manufacturing, but also as the "guiding spirit" behind the termination of the Plaintiffs' employment contract. Accordingly, the Court is not restricted in its ability to exercise jurisdiction over Esher as an individual.
Next, the Court must apply Rano's three-step test and determine whether the Court has specific jurisdiction over Esher. To determine whether Esher "purposefully availed" himself to the laws of California, the Court must examine "if the defendant intentionally directed his activities into the forum state." Brainerd v. Governors of Alberta, 873 F.2d 1257, 1259 (9th Cir. 1989). To meet this test, "the defendant must have 1) committed an intentional act, which was 2) expressly aimed at the forum state, and 3) caused harm, the brunt of which is suffered and which the defendant knows is likely to be suffered in the forum state." Bancroft Masters, Inc. v. Augusta National, Inc., 223 F.3d 1082, 1087 (9th Cir. 2000).
In Brainerd, the court stated that the defendant's "communications were directed to Arizona. . . . [the defendant] knew the injury and harm stemming from his communications would occur in Arizona, where [the plaintiff] planned to live and work." Id. Similarly, in Metropolitan Life Insurance Co. v. Neaves, 912, F.2d 1062 (9th Cir. 1990), the court held that an Alabama resident could be haled into a California court on the basis of a letter she sent to an insurance company representing that she was entitled to an insurance payment that actually belonged to a California resident. The critical factor in the court's holding was the defendant "was purposefully defrauding [plaintiff] in California" by sending the letter. Id. at 1065.
In this case, Plaintiffs have adequately alleged that Esher knew that Plaintiffs' resided in California. It is also adequately alleged that Esher was responsible for at least three communications to Plaintiffs in California. Plaintiffs also allege that these communications, culminating in the termination of the Agreement, constituted tortious conduct, including, but not limited to, intentional interference with contractual relations. At this stage of the litigation, the Court must accept Plaintiffs' allegations as truth. Accordingly, the Court finds that Esher engaged in allegedly wrongful conduct targeted at Plaintiffs, and that Esher knew Plaintiffs were residents of California.
Furthermore, there is no doubt that Plaintiffs' claims arise out of Defendants' forum related activities. Plaintiffs' contract claims directly arise from Esher's communications, sent to Plaintiffs in California, that eventually resulted in the termination of the Agreement. Accordingly, the second prong of the Rano test is satisfied.
Finally, the Court must determine whether asserting personal jurisdiction over Esher is reasonable. The Ninth Circuit applies a seven factor test to determine the reasonableness of the exercise of personal jurisdiction: 1) the extent of the defendant's purposeful interjection into the state forum; 2) the burden on the defendant of defending in the chosen forum; 3) the extent of conflict with the sovereignty of defendant's state; 4) the forum state's interest in adjudicating the dispute; 5) the most efficient forum for judicial resolution of the dispute; 6) the importance of the forum to plaintiff's interest in convenient and effective relief; and 7) the existence of an alternative forum. Core-Vent Corp. v. Nobel Industries A.B., 11 F.3d 1482, 1487 (9th Cir. 1993).
Since Esher purposefully directed his activities into California, personal jurisdiction over him is presumed to be reasonable. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477 (1985). Esher must present a compelling case that jurisdiction would be unreasonable. Id.
The Core-Vent factors do not seem to heavily favor either party. Under the first factor, while the extent of Esher's "purposeful interjection" was not overwhelming, it was also not minimal. Esher's email, phone call, and letter were all directed to Plaintiffs in California and were incidents that gave rise to Plaintiffs' claims. This factor weighs in favor of Plaintiffs.
Second, while Esher will bear a burden in litigating this case in California, the Ninth Circuit has recognizing that "modern means of communication and transportation have tended to diminish the burden of defense of a lawsuit in a distant forum." Insurance Co. of North America v. Marina Salina Cruz, 649 F.2d 1266, 1271 (9th Cir. 1981). Moreover, Esher's burden "will not be deemed unreasonable unless it constitutes a deprivation of due process." Yahoo! Inc. v. La Lige Contre Le Racisme Et L'Antisemitisme, 379 F.3d 1120, 1136 (9th Cir. 2004). Esher has alleged no such facts. Therefore, this factor weighs slightly in Esher's favor.
Third, there appears to be no conflict between the laws of California and Georgia, thus this factor appear to be neutral.
Fourth, a state always maintains a strong interest in providing an effective means of redress for its residents who are tortiously injured. Brainerd, 873 F.3d at 1260. Thus, this factor weighs in favor of Plaintiffs.
Fifth, "the efficient-resolution factor considers the availability of evidence and witnesses and the forum which is more familiar with the facts and history of the case." Yahoo!, 379 F.3d at 1137. Plaintiff's business records and most of their witnesses are located in California. Esher has not stated where the majority of his witnesses and evidence would be located. Accordingly, this factor is neutral or favors Plaintiff.
Sixth, there can be little question that California is the more convenient and effective forum from Plaintiffs' perspective. However, courts have noted that this factor is "not of paramount importance." Harris Rutsky Co. Ins. Servs., Inc. v. Bell Clements Ltd., 328 F.3d 1122, 1129 (9th Cir. 2003). This factor is either neutral or favor Plaintiffs.
Finally, Georgia is a possible alternative forum. There is no question that a federal court in Georgia would properly have personal jurisdiction over Esher. Thus, this factor favors Esher.
In sum, the majority of the Core-Vent factors either favor Plaintiffs or are neutral. As previously stated, Esher carries the burden to present a compelling case that the exercise of jurisdiction is unreasonable. He has not carried this burden. Accordingly, the Court concludes that it is reasonable to exercise jurisdiction over Esher.
CONCLUSION
For the foregoing reasons, Defendants' 12(b)(6) Motion to Dismiss the breach of fiduciary duty claim is DENIED with respect to Coe Newnes, and GRANTED with leave to amend with respect to Coe Manufacturing and Esher. Defendants' 12(b)(6) Motion to Dismiss the intentional interference with prospective economic advantage claim is GRANTED with leave to amend. Defendant Esher's 12(b)(2) Motion to Dismiss is DENIED.
IT IS SO ORDERED.