Title: Worthy v. Cyberworks Technologies, Inc.

State: alabama

Issuer: Alabama Supreme Court

Document:

835 So. 2d 972 (2002)
Gerald WORTHY and Merion Worthy
v.
CYBERWORKS TECHNOLOGIES, INC.
1001636.

Supreme Court of Alabama.
March 29, 2002.
Rehearing Denied May 17, 2002.
L. Daniel Mims, Mobile, for appellants.
Submitted on appellants' brief only.
HARWOOD, Justice.
Gerald Worthy and Merion Worthy appeal from the trial court's order granting a motion to dismiss filed by Cyberworks Technologies, Inc. (hereinafter referred to as "Cyberworks"), on the basis that the trial court lacked personal jurisdiction over Cyberworks. We affirm.
On October 4, 1999, the Worthys sued Soho Technologies, Inc. ("Soho"), Cyberworks, Cornerstone International ("Cornerstone"), and Nathaniel R. Kinsella, vice president of operations for Cornerstone, *973 alleging fraud, violation of the "Alabama Telemarketing Act," § 8-19A-1 et seq., Ala.Code 1975, and violation of Alabama's "Deceptive Trade Practices Act," § 8-19-1 et seq., Ala.Code 1975. On October 22, 1999, Cyberworks filed a motion to dismiss, arguing that the trial court lacked jurisdiction over it and that service of process on it had been insufficient. The motion further stated (1) that Cyberworks was incorporated in Utah, with its principal place of business in Salt Lake City, Utah; (2) that Cyberworks had had no contacts with the State of Alabama; and (3) that Cyberworks did not transact business in the State of Alabama and had made no contacts with the Worthys. On November 12, 1999, the affidavit of Scott Alexander, the president of Cyberworks, was submitted in support of the motion to dismiss.
On January 26, 2000, the Worthys filed a response to Cyberworks' motion to dismiss; they argued that Cyberworks had sufficient contacts with the State of Alabama for the trial court to exercise jurisdiction over it as a nonresident defendant by operation of Rule 4.2, Ala. R. Civ. P., and applicable caselaw. They also specifically alleged, as they had in their complaint, that Kinsella was an officer, employee, or agent of Cyberworks. Their response stated, in pertinent part, the following underlying facts to their action:
The Worthys also attached to their response a letter, dated March 30, 1999, from Cyberworks' employee Shawn Crumley to the Worthys' attorney and a copy of a check written on a Cyberworks' account to Cornerstone in the amount of $24,684.68, with a commission sheet showing most of the amount of the check represented a commission from a purchase made by the Worthys. On October 2, 2000, the Worthys filed a supplemental response to Cyberworks' motion to dismiss, attaching as exhibits a copy of a long-distance telephone bill of Cyberworks that showed that it had made two calls to the Worthys, the transcribed deposition of Alexander, and several copies of completed "Scholarship Guarantee and Agreement" forms as evidence that Cyberworks had conducted Internet marketing workshops in several states, although Alabama was not one of those states.
*974 On January 25, 2001, Cyberworks filed a brief in reply to the Worthys' response. Cyberworks attached as exhibits the affidavit of Alexander, portions of Alexander's transcribed deposition testimony, and a copy of a purchase contract the Worthys entered into with Soho. On February 18, 2001, the trial court granted Cyberworks' motion to dismiss by noting the following on the face of the motion to dismiss:
On March 19, 2001, the Worthys filed a motion to alter, amend, or vacate the order of dismissal. On March 26, 2001, Cyberworks filed a response to the Worthys' postjudgment motion. On May 3, 2001, the trial court denied the Worthys' postjudgment motion and certified its order of dismissal as final pursuant to Rule 54(b), Ala. R. Civ. P. On June 8, 2001, the Worthys filed a notice of appeal to this Court.
On appeal, the Worthys argue that the trial court erred in granting Cyberworks' motion to dismiss because, they say, Cyberworks had sufficient contacts with Alabama for the trial court to exercise jurisdiction over it as a nonresident defendant. They also assert that the standard of review applicable to a summary judgment applies in this case. We infer from their brief that they assert that the summary-judgment standard is the appropriate standard because the trial court considered matters outside the pleadings in granting the motion to dismiss. See Rule 12(c), Ala. R. Civ. P. However, the Committee Comments on 1973 Adoption of Rule 12 state, in pertinent part:
(Citing Williams v. Minnesota Mining & Mfg. Co., 14 F.R.D. 1 (S.D.Cal.1953).) See also Williams v. Skysite Communications Corp., 781 So. 2d 241 (Ala.Civ.App.2000). Thus, the appropriate standard of review applicable to this case is de novo: "An appellate court considers de novo a trial court's judgment on a party's motion to dismiss for lack of personal jurisdiction." Elliott v. Van Kleef, 830 So. 2d 726, 729 (Ala.2002)[*] (citing Greene v. Connelly, 628 So. 2d 346 (Ala.1993); Skysite Communications, supra).
The Worthys argue that Rule 4.2, Ala. R. Civ. P., is sufficiently broad to subject Cyberworks to jurisdiction in an Alabama court. The portions of Rule 4.2, Alabama's long-arm rule governing out-of-state service, relied upon by the Worthys, state:
With regard to the application of Rule 4.2, this Court has stated:
"Ex parte Phase III Constr., Inc., 723 So. 2d 1263, 1266 (Ala.1998) (Lyons, J., concurring in the result). Furthermore, this Court has held that, for specific in personam jurisdiction, there must exist `a clear, firm nexus between the acts of the defendant and the consequences complained of.' Duke v. Young, 496 So. 2d 37, 39 (Ala.1986). See also Ex parte Kamilewicz, 700 So. 2d 340, 345 n. 2 (Ala.1997).
Elliott v. Van Kleef, 830 So. 2d  at 729-31.
The Worthys contend that Cyberworks had the requisite minimum contacts with Alabama through Kinsella and Cornerstone, which, they say, were agents of Cyberworks. The record contains the following evidence and submissions regarding contacts with Alabama by Cyberworks and its alleged agents:
1. An affidavit of Alexander, president of Cyberworks, that states, in pertinent part:
2. A letter dated March 30, 1999, to the Worthys' attorney from Shawn Crumley, whose signature appears on the letter on behalf of Cyberworks, that, in pertinent part, states:
3. A copy of the check and the commission sheet showing that Cyberworks received $42,015 from the Worthys and that Cornerstone's commission on the sale was $30,954.46.
4. A copy of a long-distance telephone bill showing that Cyberworks made two telephone calls to the Worthys' residence, both on June 15, 1998.
5. The transcribed deposition testimony of Alexander, in which he discussed the relationship that existed between Cyberworks and Cornerstone, and Cyberworks' contacts with Alabama, as follows:
Based on the information contained in the record, we initially conclude that Cyberworks' contacts with Alabama do not support an exercise of general jurisdiction by an Alabama court because its contacts were not "`continuous and systematic'" Elliott v. Van Kleef, 830 So. 2d  at 730 (quoting Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414 n. 9, 104 S. Ct. 1868, 80 L. Ed. 2d 404 (1984)). Furthermore, Cyberworks' two telephone calls to the Worthys, standing alone, are not contacts sufficient to invoke specific in personam jurisdiction because they do not provide "`a clear, firm nexus between the acts of the defendant and the consequences complained of.'" Elliott v. Van Kleef, 830 So. 2d  at 731 (quoting Duke v. Young, 496 So. 2d 37, 39 (Ala.1986), and citing Ex parte Kamilewicz, 700 So. 2d 340, 345 n. 2 (Ala.1997)).
Therefore, we must consider whether Cornerstone and Kinsella were agents of Cyberworks, as the Worthys argue, to determine whether their contacts with the Worthys will support an exercise of specific in personam jurisdiction over Cyberworks. In regard to our consideration of whether an agency relationship exists, this Court has stated:
Dickinson v. City of Huntsville, 822 So. 2d 411, 416 (Ala.2001). "Evidence is `substantial' *981 if it is of `such weight and quality that fair-minded persons in the exercise of impartial judgment can reasonably infer the existence of the fact sought to be proved.'" Id. (quoting West v. Founders Life Assurance Co. of Florida, 547 So. 2d 870, 871 (Ala.1989)). Our review of the record shows that the Worthys failed to produce substantial evidence that Cyberworks had a right of control over Cornerstone or Kinsella. Thus, they have failed to meet their burden of proving that an agency relationship existed between Cyberworks and Cornerstone or between Cyberworks and Kinsella. We therefore conclude that the trial court did not err in granting Cyberworks' motion to dismiss because Cyberworks' actions cannot be said to have been "purposefully directed" toward Alabama; Cyberworks should not be haled into an Alabama court based upon "`"the unilateral activity of another person or a third person."'" See Elliott v. Van Kleef, 830 So. 2d  at 731 (quoting Asahi Metal Indus., Co. v. Superior Court of California, 480 U.S. 102, 112, 107 S. Ct. 1026, 94 L. Ed. 2d 92 (1987), and Burger King Corp. v. Rudzewicz, 471 U.S. 462, 475, 105 S. Ct. 2174, 85 L. Ed. 2d 528 (1985), in turn quoting Helicopteros Nacionales, 466 U.S.  at 417, 104 S.Ct. 1868). The judgment of the trial court is due to be affirmed.
AFFIRMED.
MOORE, C.J., and SEE, BROWN, and STUART, JJ., concur.
[*]  Note from the reporter of decisions: The Alabama Supreme Court issued its original opinion in Elliott v. Van Kleef on January 11, 2002. On April 12, 2002, the Alabama Supreme Court withdrew its January 11, 2002, opinion and substituted another opinion.