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Coast Equities, LLC v. Right Buy Properties, LLC

United States District Court, D. Oregon, Portland Division

March 31, 2015

COAST EQUITIES, LLC, Plaintiff,
v.
RIGHT BUY PROPERTIES, LLC; INVESTUS (MICHIGAN) LLC; EXIT STRATEGY APRIL 13, LLC; EXIT STRATEGY AUGUST 12, LLC; EXIT STRATEGY DECEMBER 12, LLC; EXIT STRATEGY FEBRUARY 13, LLC; EXIT STRATEGY JANUARY 13, LLC; EXIT STRATEGY JUNE 13, LLC; EXIT STRATEGY MARCH 13, LLC; EXIT STRATEGY MAY 13, LLC; EXIT STRATEGY NOVEMBER 12, LLC; EXIT STRATEGY SEPTEMBER 12, LLC; EXIT STRATEGY DECEMBER 13, LLC; RONALD MACKIE; MARTIN GREER; STEVE GREER; and JOHN J. GRACE, Defendants.

OPINION AND ORDER

MICHAEL W. MOSMAN, District Judge.

On July 3, 2014, Plaintiff Coast Equities, LLC ("Coast Equities") filed an action seeking damages for one claim of breach of contract and one claim of fraud. Coast Equities alleged that Defendants breached a Purchase and Sale Agreement ("PSA") covering real estate in Florida by failing to cure or remove certain unacceptable title defects and by attempting to substitute other properties for those with title defects. Additionally, Coast Equities alleged that Defendants fraudulently misrepresented the condition of the properties and the status of municipal liens against the properties. Each Defendant eventually filed a motion to dismiss for lack of personal jurisdiction and improper venue.

On February 18, 2015, Magistrate Judge Stewart issued her Findings and Recommendation [89] ("F&R") with regards to Defendants Right Buy Properties, LLC ("RBP"), Ronald Mackie ("Mackie"), Investus (Michigan) LLC ("Investus") and the Exit Strategy LLCs' Motions to Dismiss for Lack of Jurisdiction [44 and 77]. Judge Stewart determined that each defendant lacked sufficient contacts with the state of Oregon to give rise to personal jurisdiction and that Oregon was an improper venue for Coast Equities's claims to proceed. She recommended that I grant both motions and enter judgment dismissing this case.

On March 4, 2015, Coast Equities filed objections to the F&R. Coast Equities identifies what it believes to be ten substantial errors in the F&R's personal jurisdiction analysis, as well as several errors with the F&R's venue analysis. I am not persuaded by Coast Equities's arguments regarding personal jurisdiction. I adopt the F&R as my own, and grant both Motions to Dismiss for Lack of Jurisdiction.

LEGAL STANDARDS

The magistrate judge makes only recommendations to the court, to which any party may file written objections. The court is not bound by the recommendations of the magistrate judge, but retains responsibility for making the final determination. The court is generally required to make a de novo determination regarding those portions of the report or specified findings or recommendation as to which an objection is made. 28 U.S.C. § 636(b)(1)(C). However, the court is not required to review, de novo or under any other standard, the factual or legal conclusions of the magistrate judge as to those portions of the F&R to which no objections are addressed. See Thomas v. Arn, 474 U.S. 140, 149 (1985); United States v. Reyna-Tapia, 328 F.3d 1114, 1121 (9th Cir. 2003). While the level of scrutiny under which I am required to review the F&R depends on whether or not objections have been filed, in either case, I am free to accept, reject, or modify any part of the F&R. 28 U.S.C. § 636(b)(1)(C).

When a defendant moves to dismiss for lack of personal jurisdiction, the plaintiff bears the burden of establishing that the court has personal jurisdiction over the defendant. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004) (citing Sher v. Johnson, 911 F.2d 1357, 1361 (9th Cir. 1990)). In ruling on the jurisdictional issue, the court may consider evidence presented in affidavits and may order discovery on jurisdictional issues. Doe v. Unocal Corp., 248 F.3d 915, 922 (9th Cir. 2001) (citing Data Disc, Inc. v. Sys. Tech. Assoc., Inc., 557 F.2d 1280, 1285 (9th Cir. 1977)). Where, as here, the court has not held an evidentiary hearing, the plaintiff need only submit evidence that supports a prima facie case of personal jurisdiction over the defendant. Ballard v. Savage, 65 F.3d 1495, 1498 (9th Cir. 1995) (citations omitted).

The Ninth Circuit has established a three-pronged test for determining whether the exercise of specific personal jurisdiction over a non-resident defendant is appropriate:

(1) The non-resident defendant must purposefully direct his activities or consummate some transaction with the forum or resident thereof; or perform some act by which he purposefully avails himself of the privilege of conducting activities in the forum, thereby invoking the benefits and protections of its laws;
(2) the claim must be one which arises out of or relates to the defendant's forum-related activities; and
(3) the exercise of jurisdiction must comport with fair play and substantial justice, i.e. it must be reasonable.

Schwarzenegger, 374 F.3d at 802 (quoting Lake v. Lake, 817 F.2d 1416, 1421 (9th Cir. 1987)).

DISCUSSION

I. Personal Jurisdiction over Investus or the ...


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