Opinion
No. 2D22-2641.
04-05-2023
CONCORDIA LUTHERAN MINISTRIES, Appellant, v. Lara Danielle WILLS, as personal representative of the Estate of Linda Schumer, deceased; Concordia of Florida, Inc.; Lisa Jean Brooks; and Michele S. Capurso (as to Concordia Village of Tampa), Appellees.
David O. Doyle and Bethany W. Nduka of Pearson Doyle Mohre & Pastis, LLP, Maitland, for Appellant. Lisa M. Tanaka of Wilkes & Associates, P.A., Tampa, for Appellee Lara Danielle Wills. No appearance for remaining Appellees.
David O. Doyle and Bethany W. Nduka of Pearson Doyle Mohre & Pastis, LLP, Maitland, for Appellant.
Lisa M. Tanaka of Wilkes & Associates, P.A., Tampa, for Appellee Lara Danielle Wills.
No appearance for remaining Appellees.
SILBERMAN, Judge.
Lara Danielle Wills, as personal representative of the Estate of Linda Schumer, deceased (the Estate), filed this action as a result of alleged nursing home negligence during Ms. Schumer's stay at Concordia Village of Tampa. The Estate sued Concordia of Florida, Inc., and Concordia Lutheran Ministries (CLM), as well as two employees of Concordia Village, Lisa Jean Brooks and Michele S. Capurso. Defendant CLM, a Pennsylvania not-for-profit corporation, appeals a nonfinal order that denies its motion to dismiss and contends that the trial court erred in determining that it could exercise personal jurisdiction over CLM. Because CLM's affidavit does not fully dispute the jurisdictional allegations and sufficient minimum contacts exist to satisfy due process concerns based on the alleged tort of aiding and abetting a breach of fiduciary duty in Florida, we affirm the trial court's order.
I. BACKGROUND
Concordia of Florida is the operator of a skilled nursing facility in Tampa, Concordia Village of Tampa (the Facility). CLM has its principal place of business in Pennsylvania and is not registered to do business in Florida. CLM is a holding company and is the sole member of Concordia of Florida. It is undisputed that Concordia of Florida is a subsidiary of CLM.
In its complaint, the Estate alleged against CLM two negligence counts, one wrongful death count, one count of aiding and abetting Concordia of Florida's breach of fiduciary duty, and one count of exploitation of a vulnerable adult in violation of section 415.111, Florida Statutes (2019). The Estate made jurisdictional allegations under section 48.193, Florida Statutes (2019), Florida's long-arm statute. The Estate alleged that CLM was doing business in Florida and was the sole owner of the Facility. Further, the Estate alleged that CLM
conducted and engaged in business activities within the State of Florida; engaged in substantial and not isolated activities within the State of Florida; and purposely availed itself of the privileges of the State of Florida, through its ownership of, leasing of, operation of, management of, and/or consultation with nursing homes, including CONCORDIA VILLAGE OF TAMPA, within the State of Florida.
The Estate also alleged that CLM committed tortious acts against Linda Schumer in Florida. In count five for aiding and abetting, the Estate alleged that Concordia of Florida breached fiduciary duties that it owed to the residents of the Facility, including Schumer. According to the allegations, CLM aided and abetted Concordia of Florida in breaching those duties through various specified acts, including the improper transfer of funds to CLM that adversely impacted the level of care and services provided to residents of the Facility. The Estate alleged that these transfers were for the purpose of improperly and unjustly enriching CLM and that Schumer suffered injuries as a result. In addition, the Estate alleged that CLM structured and approved contracts between itself and Concordia of Florida which CLM "knew or should have known would result in the diversion of facility revenues necessary to provide the care and services to its residents, including LINDA SCHUMER."
CLM filed a motion to dismiss the complaint with prejudice, but at the hearing on the motion, CLM orally amended its motion to seek a dismissal without prejudice. In support of its motion to dismiss, CLM filed a sworn affidavit by CLM's chief operating officer, Brian Hotert. In opposition, the Estate filed three documents from public records: (1) a consent order entered into by the Florida Office of Insurance Regulation, Concordia of Florida, and CLM regarding Concordia of Florida's purchase of a continuing care retirement community facility, (2) an excerpt from an IRS Form 990 Schedule O, and (3) the Facility's application for Medicare and Medicaid.
At the conclusion of a nonevidentiary hearing, the trial court denied the motion to dismiss. The trial court found that CLM "has sufficient minimum contacts to Florida for this Court to exercise jurisdiction over the Defendant."
II. ANALYSIS
When the trial court does not conduct an evidentiary hearing, our review of an order on a motion to dismiss for lack of personal jurisdiction is strictly de novo. See Stonepeak Partners, LP v. Tall Tower Cap., LLC, 231 So.3d 548, 552 (Fla. 2d DCA 2017); Rautenberg v. Falz, 193 So.3d 924, 928 (Fla. 2d DCA 2016). The courts apply the test set out in Venetian Salami Co. v. Parthenais, 554 So.2d 499, 502 (Fla. 1989), to determine whether long-arm jurisdiction exists over a foreign defendant. Rautenberg, 193 So. 3d at 928. The first prong of the two-prong test is whether the plaintiff has alleged sufficient jurisdictional facts "to bring the action within the ambit of the [long-arm] statute." Id. (quoting Wiggins v. Tigrent, Inc., 147 So.3d 76, 84 (Fla. 2d DCA 2014)). Long-arm jurisdiction can be either specific under section 48.193(1) or general under section 48.193(2). See Teva Pharm. Indus. v. Ruiz, 181 So.3d 513, 517 (Fla. 2d DCA 2015).
If the allegations of the complaint are sufficient, then the second prong "is whether sufficient `minimum contacts' are demonstrated to satisfy due process requirements." Rautenberg, 193 So. 3d at 928 (quoting Wiggins, 147 So. 3d at 84). The specific question "is whether `the defendant's conduct and connection with the forum State are such that he should reasonably anticipate being haled into court there.'" Schwartzberg v. Knobloch, 98 So.3d 173, 178 (Fla. 2d DCA 2012) (quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 297, 100 S.Ct. 559, 62 L.Ed.2d 490 (1980)).
A defendant may challenge the plaintiff's jurisdictional allegations or assert a lack of minimum contacts by filing a motion to dismiss the complaint and "legally sufficient affidavits or other sworn proof in support." Volkswagen Aktiengesellschaft v. Jones, 227 So.3d 150, 155 (Fla. 2d DCA 2017) (first citing Venetian Salami, 554 So. 2d at 502; and then citing Rautenberg, 193 So. 3d at 928-29). "If the defendant's affidavit fully disputes the jurisdictional allegations, then the burden shifts back to the plaintiff to prove by affidavit or other sworn proof that there is a basis for long-arm jurisdiction." Rautenberg, 193 So. 3d at 929 (citing Hilltopper Holding Corp. v. Estate of Cutchin ex rel. Engle, 955 So.2d 598, 602 (Fla. 2d DCA 2007)). When the affidavits and other sworn proof "can be harmonized, then the trial court can determine the issue of jurisdiction based on the undisputed facts." Id. (citing Schwartzberg, 98 So. 3d at 178). If the affidavits are in conflict, then the trial court must resolve the issue after conducting a limited evidentiary hearing. Id. (citing Schwartzberg, 98 So. 3d at 178). Here, the parties do not dispute that the Estate made sufficient jurisdictional allegations in its complaint, alleging both general and specific jurisdiction.
A. General Jurisdiction
The Florida long-arm statute provides for general jurisdiction over a foreign defendant when the defendant has "engaged in substantial and not isolated activity within this state." Teva Pharm. Indus., 181 So. 3d at 517 (quoting § 48.193(2), Fla. Stat. (2009)). For a court to have general jurisdiction, a foreign corporation must have affiliations with that state which "are so `continuous and systematic' as to render [it] essentially at home in the forum State." Id. at 521 (alteration in original) (quoting Daimler AG v. Bauman, 571 U.S. 117, 139, 134 S.Ct. 746, 187 L.Ed.2d 624 (2014)). The Estate alleged general jurisdiction under section 48.193(2), but the Hotert affidavit, discussed below, refutes the Estate's allegations. In fact, in its response in opposition to the motion to dismiss, the Estate asserted only specific jurisdiction under section 48.193 and that CLM had sufficient minimum contacts with Florida. Similarly, in its answer brief the Estate has not argued jurisdiction under a general jurisdiction theory. Thus, we do not address general jurisdiction further and turn to the issue of specific jurisdiction.
B. Specific Jurisdiction
The Estate relies upon specific jurisdiction under section 48.193(1)(a)1 and (1)(a)2:
(1)(a) A person, whether or not a citizen or resident of this state, who personally or through an agent does any of the acts enumerated in this subsection thereby submits himself or herself and, if he or she is a natural person, his or her personal representative to the jurisdiction of the courts of this state for any cause of action arising from any of the following acts:
1. Operating, conducting, engaging in, or carrying on a business or business venture in this state or having an office or agency in this state.
2. Committing a tortious act within this state.
1. Conducting Business in Florida. As to operating, conducting, engaging in, or carrying on a business or business venture in Florida, the Hotert affidavit refutes this allegation.
"Ownership of a resident subsidiary corporation by an out-of-state parent corporation, without more, has been repeatedly deemed insufficient to meet the requirements of section 48.193." Schwartzberg, 98 So. 3d at 181 (quoting Res. Healthcare of Am., Inc. v. McKinney, 940 So.2d 1139, 1143 (Fla. 2d DCA 2006)). Jurisdiction can be established by piercing the corporate veil or if the plaintiff demonstrates "that the parent exercises sufficient control over the subsidiary to render the subsidiary an agent or alter ego of the parent." Id. at 182.
In its motion to dismiss, CLM acknowledges that it has an ownership interest in "Concordia of Florida, Inc. (`Concordia Village')" and that it is "an indirect parent company of Concordia Village." Hotert's affidavit filed in support of the motion includes the following assertions. CLM is a Pennsylvania corporation. It is a holding company that owns senior living and assisted living facilities in Pennsylvania, Ohio, and Florida, including Concordia of Florida, but does not operate any of the facilities that it owns. CLM does not direct or control the day-to-day operations of Concordia of Florida or the actions of its directors or executives. CLM has not entered into an agreement with Concordia of Florida "to combine money, property, or time in the conduct of a business deal or to share in the operation of Concordia [of Florida]." CLM does not have any office or place of business in Florida, does not have any real property, clients, or employees in Florida, and does not transact regular business in Florida. CLM has not designated or acknowledged Concordia of Florida as an agent for CLM. CLM keeps separate accounting records from Concordia of Florida's records, and they each maintain separate banking relationships. Further, CLM does not make clinical decisions regarding residents of the Facility, control treatment, or employ nurses or other staff.
The public record documents that the Estate filed are insufficient to contradict Hotert's detailed affidavit. As to the consent order, Concordia of Florida, Inc. d/b/a Concordia Village of Tampa is the applicant "for approval of the acquisition of the assets of John Knox Village of Tampa Bay, Inc." It was Concordia of Florida that entered into the asset purchase agreement. Initial funding for the acquisition was via a $14 million loan from CLM and a $7 million gift from CLM and an affiliated foundation. Both CLM and Concordia of Florida executed the consent order.
The excerpts from the federal tax form indicate that CLM acquired John Knox Village in Tampa, which is now doing business as the Facility. But the excerpts also state that "the Organization donated funds to Concordia of Florida" regarding the John Knox Village acquisition. Although, as the Estate argues, there are some portions that say CLM "now provides care in three states" and "offers the full suite of senior care services through its continuum of care," these statements are insufficient to controvert Hotert's detailed sworn assertions in his affidavit. See Schwartzberg, 98 So. 3d at 179, 182 (stating that the plaintiff's affidavit "established only that the [defendants] have indirect ownership interests in the nursing home's operating and management companies" where, among other things, the affidavit asserts that "the Schwartzberg Companies sent a letter to the Agency for Health Care Administration (AHCA) stating, `[a]s you know, our companies operate 17 facilities in Florida under the `Palm Garden' and `Palm Terrace' trade names'" (second alteration in original)). The contents of the consent order and the IRS form can be harmonized with Hotert's affidavit, describing the acquisition of the Facility, CLM's ownership interest in the Facility, and the Facility's operations, but they do not provide sufficient information to controvert Hotert's affidavit.
The Facility's application for Medicare and Medicaid benefits also does not refute the affidavit. The application states that CLM owns the Facility, and it is signed by a person listed as "Corporate RN." The signature line does not state if it is a "Corporate RN" of CLM or Concordia of Florida. The Hotert affidavit states that CLM has no employees. While the application acknowledges CLM's ownership interest, it does not counter the salient facts alleged in Hotert's affidavit regarding specific jurisdiction.
Based on Hotert's affidavit and the limited documentation that the Estate submitted in response to the motion to dismiss, we conclude that jurisdiction over CLM was not established for the conduct of a business or business venture under section 48.193(1)(a)1.
This court's recent decision in Kapila v. RJPT, Ltd., No. 2D22-837, 357 So.3d 241, 245-49 (Fla. 2d DCA Feb. 17, 2023), sets out an analytical framework for long-arm jurisdiction over an out-of-state investment firm conducting a business venture in Florida. It does not govern our decision on this issue as Hotert's affidavit refutes the Estate's allegations of doing business in Florida, and, as discussed previously, the documentation that the Estate relied upon in opposition to the motion to dismiss did not controvert the affidavit.
2. Committing a Tortious Act in Florida. The Hotert affidavit, however, does not sufficiently refute the allegation that CLM committed a tortious act in Florida by aiding and abetting Concordia of Florida's breach of fiduciary duty to Schumer. An affidavit submitted to dispute jurisdiction must contain factual allegations rather than legal conclusions. See Hilltopper, 955 So. 2d at 602. Hotert's affidavit does not suffer from reliance on legal conclusions; instead, it simply fails to set out facts refuting the aiding and abetting claim. If factually correct, CLM could have asserted that it did not structure and approve contracts in Florida with Concordia of Florida which CLM "knew or should have known would result in the diversion of facility revenues necessary to provide the care and services to its residents, including LINDA SCHUMER." But Hotert's affidavit does not address contracts that may have been entered into regarding repayment of CLM's capital investment in Concordia of Florida or the impact of repayment on the availability of funds to provide adequate care for residents. Further, the affidavit does not contain factual allegations that refute the Estate's allegations as to CLM's conduct in aiding, assisting, and encouraging Concordia of Florida's breach of fiduciary duties owed to residents such as Schumer.
CLM contends that it need not contest the ultimate facts alleged for aiding and abetting breach of a fiduciary duty. However, ultimate issues of fact may be the focus of a personal jurisdiction inquiry:
While the question of whether the [defendants] misappropriated Citrix's business information is one of the ultimate merits issues in the case, it may still be the subject of a Venetian Salami inquiry. See Holland v. Anheuser Busch, Inc., 643 So.2d 621, 623 n.2 (Fla. 2d DCA 1994) (recognizing that "under certain circumstances a trial court, on a motion to dismiss supported by affidavit, has the authority to decide ultimate issues of fact relating to jurisdiction over the person").
Ware v. Citrix Sys., Inc., 258 So.3d 478, 484 (Fla. 4th DCA 2018). In considering factual issues relating to jurisdiction, the trial court "need not decide the ultimate legal question of whether the [defendants] are actually liable for the various acts alleged in [the plaintiff's] complaint." Id.
With respect to minimum contacts, "[t]he Florida Supreme Court has held that `by committing a tort in Florida a nonresident defendant establishes "minimum contacts" with Florida to justify the acquisition of in personam jurisdiction over him.'" Ileyac Shipping, Ltd. v. Riera-Gomez, 899 So.2d 1230, 1232 (Fla. 3d DCA 2005) (quoting Godfrey v. Neumann, 373 So.2d 920, 922 (Fla. 1979)). Without CLM asserting that it did not perform the alleged actions in Florida, it failed to fully refute the jurisdictional allegations. Based on the alleged commission of a tort in Florida, CLM has minimum contacts with Florida to justify personal jurisdiction.
CLM contends that the exercise of personal jurisdiction over it would fail to "comport with `fair play and substantial justice.'" Burger King Corp. v. Rudzewicz, 471 U.S. 462, 476, 105 S.Ct. 2174, 85 L.Ed.2d 528 (1985) (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 320, 66 S.Ct. 154, 90 L.Ed. 95 (1945)). "[A] defendant will not be haled into a jurisdiction solely as a result of `random,' `fortuitous,' or `attenuated' contacts or of the `unilateral activity of another party or a third person.'" Kapila v. RJPT, Ltd., No. 2D22-837, 357 So.3d 241, 251 (Fla. 2d DCA Feb. 17, 2023) (quoting Burger King, 471 U.S. at 475, 105 S.Ct. 2174). Based on the Estate's allegations, CLM's contract for Concordia of Florida to repay CLM's investment resulted "in the diversion of facility revenues necessary to provide the care and services to its residents." Further, among other allegations, CLM "regularly and repeatedly swe[pt] virtually all of the facility's revenues into an account controlled by CONCORDIA LUTHERAN MINISTRIES and/or their designee." These allegations do not suggest random or fortuitous conduct based on unilateral activity by a party other than CLM; rather, this alleged conduct was CLM's business model.
At the hearing on the motion to dismiss, CLM made only a cursory argument that requiring CLM to litigate in Florida "would be a significant burden" because it is a Pennsylvania corporation with no employees and no operational control over the Facility. CLM argued that the Estate would not be prejudiced if CLM were dismissed from the case because Concordia of Florida "is a properly named defendant," along with two employees. But leaving the Estate with Concordia of Florida as the only corporate defendant would prejudice the Estate based on its claims that Concordia of Florida is underfunded and lacks necessary resources and that CLM caused money to be regularly swept from Concordia of Florida to CLM. Based on this record, CLM has failed to "present a compelling case that the presence of some other considerations would render jurisdiction unreasonable." Burger King, 471 U.S. at 477, 105 S.Ct. 2174. Therefore, we affirm the trial court's order denying the motion to dismiss.
Affirmed.
KELLY and SMITH, JJ., Concur.