Opinion
No. 1:02-cv-262
November 4, 2003
MEMORANDUM
I. Introduction
Plaintiffs brought this action pro se on July 21, 2003. [Court File No. 3] alleging that defendants discriminated against them based upon plaintiff Dennis Phillips's alleged disability. Specifically, plaintiff Dennis M. Phillips alleged that he entered into a contract and mortgage loan with the defendants on October 26, 1999, for the purchase of a house in Fitzgerald, Ben Hill County, Georgia. [Court File No. 3]. Plaintiff Dennis M. Phillips alleges that based upon the defendants' knowledge of his alleged disability due to mental illness, the terms of his mortgage loan with the bank were different than the terms of the bank's usual 20-year mortgage. Plaintiffs asserts that this difference in the terms of their mortgage constituted discrimination based upon plaintiff Dennis Phillips' disability in violation of the Fair Housing Act of 1968, 42 U.S.C. § 3605; Title VI of the Civil Rights Act of 1964, 42 U.S.C. § 2000d — 2000d — 6; and the Americans with Disabilities Act, 42 U.S.C. § 12101-12213.
Prior to filing an answer, defendants filed motions [Court File No. 5, 6] seeking dismissal of this action based upon: (1) lack of in personam jurisdiction under Fed.R.Civ.P. 12(b)(2) and (2) insufficiency of service of process under Fed.R.Civ.P. 12(b)(4). II. Defendants' Motion to Dismiss for Lack of Personal Jurisdiction [Court File No. 5, 6].
Defendants move to dismiss the complaint for lack of personal jurisdiction pursuant to FED. R. CIV. P. 12(b)(2). In essence, defendants assert this Court lacks personal jurisdiction over them because they have insufficient "minimum contacts" with the State of Tennessee and could not reasonably anticipate being brought into court in Tennessee. [Court File No. 5, 6].
"In determining whether a defendant is subject to personal jurisdiction, the stage of the litigation affects the standard, but not the burden of proof. S S Screw Mach. Co. v. Cosa Corp., 647 F. Supp. 600, 605 (M.D. Term. 1986). The plaintiff bears the burden of persuasion on the issue of personal jurisdiction throughout the litigation. Id. (quoting Welsh v. Gibbs, 631 F.2d 436, 438 (6th Cir. 1980), cert. denied, 450 U.S. 981 (1981)). Specifically,
FED. R. CIV. P. 12(d) enables [a] defendant to raise a jurisdictional challenge and a court to rule on the motion before a trial on the merits. A district court may decide whether to rule on the jurisdictional issue upon a full trial record, after an evidentiary hearing, or merely on the basis of a written record . . . Welsh v. Gibbs, 631 F.2d at 438-39; Data Disc, Inc. v. Systems Technology Associates, Inc., 557 F.2d 1280, 1284-86 (9th Cir. 1977). When a court seeks to decide the issue on the basis of affidavits alone, however, plaintiff need only make a prima facie case of jurisdiction. To survive a motion to dismiss, thus, plaintiff need only "demonstrate facts which support a finding of jurisdiction." Welsh v. Gibbs, 631 F.2d at 438 (quoting Data Disc, Inc., 557 F.2d at 1285).Cosa Corp., 647 F. Supp. at 605.
Where, as here, the Court is not conducting an evidentiary hearing on the issue of personal jurisdiction:
Plaintiff must make only a prima facie showing and the Court views the evidence in the light most favorable to plaintiff. See Neogen [Corp v. Neo Gen Screening, Inc., 282 F.3d 883]. 887 [(6th Cir. 2002]; CompuServe, Inc. v. Patterson, 89 F.3d 1257, 1262 (6th Cir. 1996) . . . "[I]n the face of a properly supported motion for dismissal, the plaintiff may not stand on his pleadings but must, by affidavit or otherwise, set forth specific facts showing that the court has jurisdiction." Theunissen v. Matthews, 935 F.2d 1454, 1458 (6th Cir. 1991).Audi AG Volkswagen of America, Inc. v. Izumi, 204 F. Supp.2d 1014, 1017 (E.D. Mich. 2002).
"Where a federal court's subject matter jurisdiction over a case stems from the existence of a federal question, personal jurisdiction over a defendant exists `if the defendants [are] amenable to service of process under the [forum] state's long-arm statute and if the exercise of personal jurisdiction would not deny the defendant[s] due process.'" Bird v. Parsons, 289 F.3d 865, 871 (6th Cir. 2002) (quoting Michigan Coalition of Radioactive Material Users, Inc. v. Griepentrog, 954 F.2d 1174, 1176 (6th Cir. 1992)). The Tennessee long-arm statute, TENN. CODE ANN. § 20-2-214 states in pertinent part:
20-2-214. Jurisdiction of persons unavailable to personal service in state — Classes of actions to which applicable. — (a) Persons who are nonresidents of Tennessee . . . are subject to the jurisdiction of the courts of this state as to any action or claim for relief arising from:
(1) The transaction of any business within the state;
(2) Any tortious act or omission within this state;
. . .
(5) Entering into a contract for services to be rendered or for materials to be furnished in this state;
(6) Any basis not inconsistent with the constitution of this state or of the United States.
The Supreme Court of Tennessee has stated that the Tennessee long-arm statute is a "minimum contacts" statute which expands the jurisdiction of the courts in Tennessee "to the full limit allowed by due process." Masada Inv. Corp. v. Alien, 697 S.W.2d 332, 334 (Term. 1985) (citing Shelby Mutual Ins. Co. v. Moore, 645 S.W.2d 242, 245 (Tenn.App. 1981). See also First Tennessee Nat. Corp. v. Horizon Nat'l Bank, 225 F. Supp.2d 816 (W.D. Tenn. 2002)("[i]n Tennessee jurisdiction may be asserted on any basis not inconsistent with the constitution of Tennessee or the United States.)" Where the forum state's long-arm statute extends jurisdiction to the limits imposed by federal constitutional due process requirements, the two applicable questions become one; namely, whether the exercise of personal jurisdiction would deny the defendants due process rights. Griepentrog, 954 F.2d at 1174; Bird, 289 F.3d at 871. The Due Process Clause
protects an individual's liberty interest in not being subject to the binding judgments of a forum in which he has established no meaningful "contacts, ties, or relations." International Shoe Co. v. Washington, 326 U.S. at 319, 66 S.Ct. at 160. By requiring that individuals have "fair warning that a particular activity may subject [them] to the jurisdiction of a foreign sovereign," Shaffer v. Heitner, 433 U.S. 186, 218, 97 S.Ct. 2569, 2587, 53 L.Ed.2d 683 (1977) (STEVENS, J., concurring in judgment), the Due Process Clause "gives a degree of predictability to the legal system that allows potential defendants to structure their primary conduct with some minimum assurance as to where that conduct will and will not render them liable to suit." World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 567, 62 L.Ed.2d 490 (1980).Burger King Corp. v. Rudzewicz, 471 U.S. 462, 471-72 (1985). Thus,
[t]he Due Process Clause of the Fourteenth Amendment limits the power of a state court to exert personal jurisdiction over a nonresident defendant. "[T]he constitutional touchstone" of the determination whether an exercise of personal jurisdiction comports with due process "remains whether the defendant purposefully established `minimum contacts' in the forum State. Burger King Corp. v. Rudzewicz, 471 U.S. 462, 474, 105 S.Ct. 2174, 2183, 85 L.Ed.2d 528 (1985), quoting International Shoe Co. v. Washington, 326 U.S., at 316, 66 S. Ct., at 158. Most recently we have reaffirmed the oft-quoted reasoning of Hanson v. Denckla, 357 U.S. 235, 253, 78 S.Ct. 1228, 1239, 2 L.Ed.2d 1283 (1958), that minimum contacts must have a basis in "some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws." Burger King, 471 U.S. at 475, 105 S.Ct. at 2183. "Jurisdiction is proper . . . where the contacts proximately result from actions by the defendant himself that create a `substantial connection' with the forum State." Ibid., quoting McGee v. International Life Insurance Co., 355 U.S. 220 223, 78 So. Ct. 199, 201, 2 L.Ed.2d 223 (1957) (emphasis in original).Ashai Metal Industry Co., Ltd. v. Superior Court of California, Solano County, 480 U.S. 102, 108-09 (1987).
Under the Due Process Clause, a forum may exercise personal jurisdiction over a nonresident which has "purposefully directed" its activities toward residents of the forum because:
[a] State generally ha[s] a "manifest interest" in providing its residents with a convenient forum for redressing injuries inflicted by out-of state actors. Burger King, 471 U.S. 473, (citing McGee v. International Life Insurance Co., 355 U.S at 223).
The
"purposeful availment" requirement ensures that a defendant will not be haled into a jurisdiction solely as a result of "random," fortuitous," or "attenuated" contacts, Keeton v. Hustler Magazine, Inc., 465 U.S. at 774, 104 S. Ct, at 1478; World-Wide Volkswagen Corp. v. Woodson, supra, 444 U.S., at 299, 100 S.Ct. at 568, or of the "unilateral activity of another party or a third person," Helicopteros Nacionales de Columbia, S.A. v. Hall, supra, 466 U.S., at 417, 104 S. Ct, at 1873 . . .Burger King, 105 S.Ct. at 475-76.
Personal jurisdiction is either specific or general. First Tennessee, 225 F. Supp.2d at 820 (citing Conti v. Pneumatic Prods. Corp., 977 F.2d 978, 981 (6th Cir. 1992). If personal jurisdiction exists in this action, it would be specific personal jurisdiction. Specific personal jurisdiction
arises only when the plaintiff establishes that 1) the defendant purposefully availed himself of the privilege of acting in the forum state or causing a consequence in the forum state, 2) the cause of action arose from the defendant's activities in the forum state, and 3) the acts of the defendant or consequences caused by the defendant have a substantial enough connection with the forum state to make the exercise of jurisdiction reasonable. Southern Machine Co. v. Mohasco Industries, Inc., 401 F.2d 374, 381 (6th Cir. 1968).First Tennessee, 225 F. Supp.2d at 820.
Here, the evidence before the court is insufficient to establish specific personal jurisdiction. Rather, the evidence establishes that defendants did not solicit or engage in business within the State of Tennessee.
In support of its Rule 12(b)(2) motion, Colony Bank of Fitzgerald has submitted the affidavit of Tommy Dampier, the bank's President. [Court File No. 5]. The affidavit states that Colony Bank of Fitzgerald, which was formerly known as the Bank of Fitzgerald, is organized and exists under Georgia law and has its principal place of business in Fitzgerald, Ben Hill County, Georgia. [Court File No. 5]. The affidavit further states that:
Colony Bank of Fitzgerald . . . does not now nor has at anytime in the past had an office, agent or place of business located within the State of Tennessee nor have Colony Bank of Fitzgerald . . . transacted business in the State of Tennessee.
[Court File No. 5].
Likewise, in support of its Rule 12(b)(2) motion to dismiss, Colony Bankcorp has submitted the affidavit of its President, Dan Minix. [Court File No. 6]. Mr. Minix's affidavit stated that Colony Bankcorp is a Georgia banking corporation with its principal place of business in Fitzgerald, Ben Hill County, Georgia. [Court File No. 6]. The affidavit further states that Colony Bankcorp has no office agent or place of business in Tennessee; and, it has never transacted business in Tennessee. [Court File No. 6].
The crux of the pro se plaintiffs' complaint is that plaintiff Dennis M. Phillips, who alleges he is disabled due to mental illness, was solicited by Larry Stevenson, the vice-president of Colony Bank, on or about September 15, 1999 to purchase a house. [Court File No. 3]. It is alleged that the house had been previously repossessed by Colony Bank and was in need of extensive repairs, especially to its non-working sewers. Id. It is further alleged that Larry Stevenson was aware that Dennis Phillips had been released from an involuntary commitment to a Georgia state mental hospital; and, he solicited Phillips concerning the purchase of the house believing that Phillips "was an easy target to unload such a property." [Court File No. 3, ¶ 5].
Plaintiff alleges that on October 26, 1999, he entered into a contract with Colony Bank to purchase the aforementioned home. He asserts that as a result of his disability, the bank adopted different terms, as compared to normal 20-year mortgage loans, requiring plaintiff to pay a higher rate of interest than usual. According to plaintiff, the terms of his mortgage loan were different due to his disability, which constituted discrimination in violation of Title VII, the Fair Housing Act (Title VI) and the Americans with Disabilities Act.
The attachments to plaintiffs' complaint show that the house in question is located in Fitzgerald, Ben Hill County, Georgia. [Court File No. 3, exhibit A B]. Further, the attachments show that the mortgage and deed on the property/house were executed and recorded in Ben Hill County, Georgia [Court File No. 3, exhibits A, B C].
Further, in his complaint, plaintiff asserts that after purchasing the home in Fitzgerald, Georgia, he used the home as his primary residence. [Court File No. 3, ¶ 6]. Plaintiff states that in August 2000, he placed his Fitzgerald property with a realtor for sale and moved to his South Carolina residence, where he lived for the next 12 months. [Court File No. 3, ¶ 10]. Thereafter, plaintiff alleges that in July 2001, he sold his South Carolina residence and returned to his home in Fitzgerald, Georgia. [Court File No. 3, ¶ 11]. Plaintiff further alleges that on July 3, 2002, he received notice that due to lack of fire insurance on his Fitzgerald home, he was not in compliance with the terms of his mortgage and foreclosure proceedings on the Fitzgerald home had commenced. [Court File No. 3, ¶ 12].
Attached to plaintiff's complaint are various items of correspondence between the parties covering the time period between May 2001 and July 2002. [Court File No. 3]. This correspondence was sent/received by plaintiff either in Aiken, South Carolina or Fitzgerald, Georgia. Also attached to plaintiff's complaints are various documents from the Superior Court of Ben Hill County, Georgia. [Court File No. 3]. These documents cover the period from August 2002 through May 2003. The certificate of service on these documents show that they were mailed to plaintiffs' counsel in Tifton, Georgia. [Court File No. 3].
Thus, the evidence of record does show a complete absence of contact between the defendants and the State of Tennessee. There is no evidence which contradicts the defendants' affidavits that neither Colony Bank of Fitzgerald or Colony Bankcorp did or solicited business in Tennessee. Further, the evidence shows that neither defendant had sufficient "minimum contacts" with Tennessee or purposefully availed themselves of the privilege of conducting activities in Tennessee, such that they could reasonably anticipate being haled into a Court in Tennessee.
Accordingly, the Court finds that the motions of the defendants [Court File No. 5, 6] for dismissal of this action for lack of in personam jurisdiction pursuant to Fed.R.Civ.P. 12(b)(2) will be GRANTED. III. Defendants' Motion to Dismiss for Insufficient Service of Process [Court File No. 5, 6].
Defendants seek dismissal of this action for insufficient service of process under Fed.R.Civ.P. 12(b)(4). [Court File No. 5, 6]. However, as the Court has already determined that this action should be dismissed pursuant to Fed.R.Civ.P. 12(b)(2) for lack of in personam jurisdiction, defendants Rule 12(b)(4) motions to dismiss this action on the ground of insufficiency of service of process will be STRICKEN as having been rendered MOOT.
A separate order will enter.
ORDER
In accordance with the accompanying memorandum, defendants' Fed.R.Civ.P. 12(b)(2) motions to dismiss for lack of in personam jurisdiction [Court File No. 5, 6] are GRANTED. Further, the defendants' Fed.R.Civ.P. 12(b)(4) motions for dismissal of this action on the grounds of insufficiency of service of process [Court File No. 5, 6] are STRICKEN as having been rendered MOOT. The plaintiff's claims are DISMISSED. The Clerk shall close the file.
SO ORDERED.