Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_14-cv-03190/USCOURTS-cand-5_14-cv-03190-0/pdf.json

Nature of Suit Code: 360
Nature of Suit: Other Personal Injury
Cause of Action: 28:1331 Fed. Question: Personal Injury

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Case No. 5:14-CV-03190-EJD

ORDER GRANTING RULE 12(B)(1) AND 12(B)(2) MOTIONS TO DISMISS; DENYING AS 

MOOT RULE 12(B)(6) MOTIONS TO DISMISS; DENYING AS MOOT MOTIONS TO 

STRIKE

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Northern District of California

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

LARRY KLAYMAN,

Plaintiff,

v.

STEPHANIE A. LUCK DELUCA, 

SUZANNE JAMBE, JAMES ROLLINSON, 

BAKER HOSTETLER, HEWITT B. 

SHAW, EBAY, INC., PAYPAL, INC.,

Defendants.

Case No. 5:14-CV-03190-EJD 

ORDER GRANTING RULE 12(B)(1) 

AND 12(B)(2) MOTIONS TO DISMISS; 

DENYING AS MOOT RULE 12(B)(6) 

MOTIONS TO DISMISS; DENYING AS 

MOOT MOTIONS TO STRIKE

[Re: Dkt. Nos. 24, 27, 29, 30, 34]

Plaintiff Larry Klayman (“Plaintiff”) initiated the instant action against Defendants 

Stephanie A. Luck Deluca (“Deluca”), Baker Hostetler (“Baker Firm”), Suzanne Jambe 

(“Jambe”), James Rollinson (“Rollinson”), Hewitt B. Shaw (“Shaw”),1 eBay, Inc. (“eBay”), and 

PayPal, Inc.’s (“PayPal”) alleging fraud, tort claims, and violation of the Racketeer Influenced and 

Corrupt Organizations Act, 18 U.S.C. § 1961, et seq. (“RICO”). Presently before the court are 

Defendants’ motions to dismiss for lack of jurisdiction and failure to state a claim, and motions to 

strike pursuant to California’s Anti-SLAPP statute, Cal. Civ. Proc. Code § 425.16. The court 

found these matters suitable for decision without oral argument pursuant to Civil Local Rule 7–

1(b) and previously vacated the hearing. Having reviewed the parties’ briefing, the court 

 1 Jambe, Rollinson, and Shaw will be referred to collectively as “Baker Attorneys.”

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Case No. 5:14-CV-03190-EJD

ORDER GRANTING RULE 12(B)(1) AND 12(B)(2) MOTIONS TO DISMISS; DENYING AS 

MOOT RULE 12(B)(6) MOTIONS TO DISMISS; DENYING AS MOOT MOTIONS TO 

STRIKE

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GRANTS Deluca, Jambe, Rollinson, and Shaw’s motions to dismiss for lack of jurisdiction, and 

DENIES AS MOOT the remaining motions to dismiss and motions to strike. 

I. BACKGROUND

This action arises from an underlying divorce and child custody dispute in Ohio. Plaintiff 

alleges that in 2003, Plaintiff and Deluca divorced, both entering into a Consent Marital 

Settlement Agreement that contained a choice of law provision requiring the application of 

Virginia law. Compl. at ¶ 14. Deluca hired the Baker Firm to represent her in the divorce and 

custody proceedings. Id. at ¶ 15. In 2007, after Deluca remarried, she allegedly precluded 

Plaintiff from visiting or contacting the children. Id. at ¶ 17. Consequently, Plaintiff withheld 

child support relying on Virginia law, which provides a complete defense for non-payment of 

child support when the obligor is denied access to one’s children. Id. at ¶ 19. Plaintiff alleges that 

an Ohio court, however, erroneously applied Ohio law and found Plaintiff in contempt for the nonpayment. Id. at ¶ 20. The Ohio court also awarded a judgment of $320,000 in attorneys’ fees to 

Deluca. Id. 

Plaintiff alleges that in 2011, the Baker Firm and the Baker Attorneys filed a motion to 

show cause for Plaintiff’s non-payment of the judgment. Id. at ¶ 21. In 2012, an Ohio court 

allegedly issued subpoenas, which the Baker Firm and Baker Attorneys served on PayPal. Id. at ¶ 

24. With the subpoena, Deluca, the Baker Firm, and the Baker Attorneys allegedly sought to 

induce PayPal into releasing financial records that they believed contained Plaintiff’s banking 

information. Id. Plaintiff filed a motion to quash the subpoenas, and PayPal objected to the 

subpoenas. Id. at ¶ 28-30. After Deluca, the Baker Firm, and the Baker Attorneys allegedly 

induced the release of Plaintiff’s PayPal account information, PayPal released the information. Id.

at ¶¶ 31-34. Upon hearing of the release of the documents, Plaintiff contacted PayPal, and PayPal 

then demanded the return of the released documents and information. Id. at ¶¶ 37-38. Plaintiff 

alleges that the Baker Firm and the Baker Attorneys made photocopies or kept electronic copies of 

the released documents, and provided them to Deluca. Id. at ¶ 40. 

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Case No. 5:14-CV-03190-EJD

ORDER GRANTING RULE 12(B)(1) AND 12(B)(2) MOTIONS TO DISMISS; DENYING AS 

MOOT RULE 12(B)(6) MOTIONS TO DISMISS; DENYING AS MOOT MOTIONS TO 

STRIKE

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Plaintiff commenced the instant action in July 2014. See Dkt. No. 1. Plaintiff alleges the 

following claims against Deluca, the Baker Firm, and the Baker Attorneys: (1) fraud by statement 

to third parties; (2) fraud; (3) intrusion into private affairs; (4) trespass to chattels; (5) conversion; 

(6) unlawful, unfair, fraudulent business practices; (7) civil violations of RICO; and (8) conspiracy 

to engage in RICO. See id. Plaintiff also alleges the following claims against PayPal: (1) breach 

of contract; and (2) negligence. See id. In August 2014, Defendants filed a series of motions to 

dismiss for lack of jurisdiction, motions to dismiss for failure to state a claim, and motions to 

strike pursuant to California’s Anti-SLAPP statute. See Dkt. Nos. 24, 27, 29, 30, 34. Each motion 

has been fully briefed. See Dkt. Nos. 36, 37, 38, 39, 40, 41. 

II. LEGAL STANDARD

A. Federal Rule of Civil Procedure 12(b)(1)

Under Rule 12(b)(1), a party may file a motion to dismiss for lack of subject matter 

jurisdiction. A Rule 12(b)(1) motion may be either facial or factual. Wolfe v. Strankman, 392 

F.3d 358, 362 (9th Cir. 2004). A facial 12(b)(1) motion involves an inquiry confined to the 

allegations in the complaint, whereas a factual 12(b)(1) motion permits the court to look beyond 

the complaint to extrinsic evidence. Id. When a defendant makes a facial challenge, all material 

allegations in the complaint are assumed true, and the court must determine whether lack of 

federal jurisdiction appears from the face of the complaint itself. Id.

Federal courts are courts of limited jurisdiction, adjudicating only cases which the 

Constitution and Congress authorize. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 

377 (1994). “A party invoking the federal court’s jurisdiction has the burden of proving the actual 

existence of subject matter jurisdiction.” Thompson v. McCombe, 99 F.3d 352, 353 (9th Cir. 

1996). If a court determines that it lacks subject matter jurisdiction, the court must dismiss the 

action. Fed. R. Civ. P. 12(h)(3). 

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ORDER GRANTING RULE 12(B)(1) AND 12(B)(2) MOTIONS TO DISMISS; DENYING AS 

MOOT RULE 12(B)(6) MOTIONS TO DISMISS; DENYING AS MOOT MOTIONS TO 

STRIKE

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B. Federal Rule of Civil Procedure 12(b)(2)

Under Rule 12(b)(2), a defendant may move for dismissal based on lack of personal 

jurisdiction. Two independent limitations may restrict a court’s power to exercise personal 

jurisdiction over a nonresident defendant: the applicable state personal jurisdiction rule and 

constitutional principles of due process. Sher v. Johnson, 911 F.2d 1357, 1360 (9th Cir. 1990). 

California’s statutory limitation is co-extensive with the outer limits of due process. See id. at 

1361; Cal. Civ. Proc. Code § 410.10. Accordingly, the federal and state jurisdictional inquiries 

merge into a single analysis. See Rano v. Sipa Press, Inc., 987 F.2d 580, 587 (9th Cir. 1993).

Due process permits the exercise of jurisdiction if a court has either general or specific 

jurisdiction over a nonresident defendant. See Sher, 911 F.2d at 1361. “General jurisdiction 

applies where a defendant’s activities in the state are ‘substantial’ or ‘continuous and systematic,’ 

even if the cause of action is unrelated to those activities.” Id. “Where general jurisdiction is 

inappropriate, a court may still exercise specific jurisdiction if the defendant has sufficient 

contacts with the forum state in relation to the cause of action.” Id. (internal citations omitted). 

III. DISCUSSION

The threshold issues of subject matter and personal jurisdiction must be resolved first. 

A. Subject Matter Jurisdiction 

Federal district courts have original jurisdiction over actions based on diversity of 

citizenship or federal question. See Wayne v. DHL Worldwide Express, 294 F.3d 1179, 1183 & 

n.2 (9th Cir. 2002); 28 U.S.C. §§ 1331, 1332. Each will be addressed in turn. 

1. Diversity of Citizenship

To invoke diversity jurisdiction in an action involving United States citizens, the complaint 

must allege that the matter in controversy is between citizens of different states and the amount in 

controversy must exceed $75,000. 28 U.S.C. § 1332(a)(1). The Supreme Court has interpreted 

Section 1332(a) to require complete diversity of citizenship—each of the plaintiffs must be a 

citizen of a different state than each of the defendants. Caterpillar Inc. v. Lewis, 519 U.S. 61, 68 

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ORDER GRANTING RULE 12(B)(1) AND 12(B)(2) MOTIONS TO DISMISS; DENYING AS 

MOOT RULE 12(B)(6) MOTIONS TO DISMISS; DENYING AS MOOT MOTIONS TO 

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(1996). For purposes of diversity jurisdiction, a corporation is a citizen of the state in which it is 

incorporated and the state where its principal place of business is located. Lightfoot v. Cendant 

Morg. Corp., 769 F.3d 681, 698 (9th Cir. 2014). A partnership and an LLC “is a citizen of every 

state of which its owners/members are citizens.” Johnson v. Columbia Props. Anchorage, LP, 437

F.3d 894, 899) (9th Cir. 2006). The amount in controversy is determined from the face of the 

pleadings, and the amount alleged controls so long as the claim is made in good faith. Geographic 

Expeditions, Inc. v. Estate of Lhotka, 599 F.3d 1102, 1106 (9th Cir. 2010). 

Here, Deluca argues that this court lacks subject matter jurisdiction because there is no 

complete diversity—several partners of the Baker Firm are residents of Florida, the same state of

residency of Plaintiff. Dkt. No. 27 at 11. In response, Plaintiff states that neither the Baker Firm 

nor the Baker Attorneys have shown evidence to suggest that any of the partners of the Baker Firm 

are domiciled in Florida. Dkt. No. 36 at 11. The Ninth Circuit, however, has provided that the 

party asserting diversity jurisdiction bears the burden of proof. See Kanter v. Warner-Lambert 

Co., 265 F.3d 853, 857-58 (9th Cir. 2001). 

In the instant action, Plaintiff asserts diversity jurisdiction, and thus he bears the burden of 

proof. See Compl. at ¶ 10. In his complaint, Plaintiff alleges that he is a resident of Florida. Id. at 

¶ 1. As to the Defendants, Plaintiff alleges that: Deluca and the Baker Attorneys are residents of 

Ohio; and PayPal and eBay are corporations with its headquarters and principal place of business 

in California. Id. at ¶¶ 2-4, 6-8. There are no allegations, however, of all of the states of which 

the Baker Firm’s partners are citizens. See id. at ¶¶5. Plaintiff has failed to meet his burden, 

therefore, there is no diversity jurisdiction. Given that Plaintiff had an opportunity to rehabilitate 

this issue in his opposition brief, but failed to do so, this court presumes that allowing leave to 

amend would be futile. 

2. Federal Question 

Federal district courts have federal question jurisdiction over “all civil actions arising 

under the Constitution, laws or treaties of the United States.” 28 U.S.C. § 1331. The basis for 

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ORDER GRANTING RULE 12(B)(1) AND 12(B)(2) MOTIONS TO DISMISS; DENYING AS 

MOOT RULE 12(B)(6) MOTIONS TO DISMISS; DENYING AS MOOT MOTIONS TO 

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federal question jurisdiction must appear on the face of the properly pleaded complaint, either 

because it raises an issue of federal law or because the plaintiff’s right to relief under state law 

requires resolution of a substantial question of federal law. Franchise Tax Bd. v. Constr. Laborers 

Vacation Trust for S. Cal., 463 U.S. 1, 13 (1983).

Here, Plaintiff alleges two claims pursuant to the RICO statute. Compl. at ¶¶ 89, 101. 

Since the complaint raises an issue of federal law, there is federal question jurisdiction so long as 

the federal claims are valid. 

B. Personal Jurisdiction 

The parties do not dispute personal jurisdiction over PayPal and eBay. Thus, only personal 

jurisdiction over Deluca, the Baker Firm, and the Baker Attorneys will be addressed. 

1. Defendant Deluca

Plaintiff asserts specific personal jurisdiction over Deluca. Dkt. No. 36 at 9. The Ninth 

Circuit applies a three-prong test to determine whether a defendant has sufficient contacts to be 

susceptible to specific personal jurisdiction:

(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.

Brayton Purcell LLP v. Recordon & Recordon, 606 F.3d 1124, 1128 (9th Cir. 2010). The plaintiff 

bears the burden of satisfying the first two prongs. Schwarzenegger v. Fred Martin Motor Co., 

374 F.3d 797, 802 (9th Cir. 2004). If the plaintiff succeeds, then the burden shifts to the defendant 

to present a compelling case that the exercise of jurisdiction would not be reasonable. Id. 

To satisfy the first prong of the sufficient contacts test, a plaintiff must establish that the 

defendant either purposefully availed herself of the privilege of conducting activities in the forum 

state, or purposefully directed her activities toward the forum state. Id. Purposeful availment and 

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ORDER GRANTING RULE 12(B)(1) AND 12(B)(2) MOTIONS TO DISMISS; DENYING AS 

MOOT RULE 12(B)(6) MOTIONS TO DISMISS; DENYING AS MOOT MOTIONS TO 

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purposeful direction are two distinct concepts, with the former used in suits sounding in contract 

and the latter used in suits sounding in tort. Id. Here, Plaintiff argues the theory of purposeful

direction. Dkt. No. 36 at 7-9. 

“A showing that a defendant purposefully directed his conduct toward a forum state . . . 

usually consists of evidence of the defendant’s actions outside the forum state that are directed at 

the forum, such as the distribution in the forum state of goods originating elsewhere.” 

Schwarzenegger, 374 F.3d at 803. The Ninth Circuit evaluates purposeful direction under a threepart test traceable to the Supreme Court’s decision in Calder v. Jones, 465 U.S. 783 (1984). Id. 

The Calder effects test “requires that the defendant have (1) committed an intentional act, (2) 

expressly aimed at the forum state, (3) causing harm that the defendant knows is likely to be 

suffered in the forum state.” Id. at 805. As to the first prong, “an intentional act is an external 

manifestation of the actor’s intent to perform an actual, physical act in the real world, not 

including any of its actual or intended results.” Washington Shoe Co. v. A-Z Sporting Goods, 

Inc., 704 F.3d 668, 674 (9th Cir. 2012). As to the second prong, there is express aiming when a 

defendant knows his action will have a potentially devastating impact upon a plaintiff who 

defendant knows lives or works in the forum state. See id. at 675. 

To show purposeful direction, Plaintiff alleges that Deluca hired the Baker Firm to 

represent her in the divorce and custody proceedings. Compl. at ¶ 15. The Baker Firm, on behalf 

of Deluca, served subpoenas to PayPal so it could release Plaintiff’s financial records. Id. at ¶ 24. 

Through this act, Deluca allegedly intentionally intruded into Plaintiff’s private affairs, 

intentionally interfered with Plaintiff’s perceived use of the PayPal account, and intentionally 

interfered with records believed to be Plaintiff’s. Id. at ¶¶ 56, 62, 68. 

Deluca argues that she did not purposefully direct her conduct toward California because 

the service of subpoenas upon PayPal was an incidental and highly attenuated contact with 

California arising out of the contempt proceedings in the Ohio state court. Dkt. No. 41 at 3. 

Plaintiff generally argues that Defendant Deluca directed her actions towards Defendant PayPal, 

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MOOT RULE 12(B)(6) MOTIONS TO DISMISS; DENYING AS MOOT MOTIONS TO 

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located in California, and the torts committed were a result of the release of records kept in 

California. Dkt. No. 36 at 9. The court agrees. While Deluca may arguably have authorized an 

intentional act by serving a subpoena, through counsel, directed at a third party in California, there 

is no indication that Deluca expressly aimed her act towards California. Serving a subpoena alone 

would not have a devastating impact upon Plaintiff in California since Plaintiff neither lives nor 

works in California. See Bancroft & Masters, Inc. v. Augusta Nat. Inc., 223 F.3d 1082, 1087-88 

(9th Cir. 2000) (defendant acted intentionally when it sent a letter to plaintiff, and the letter was 

expressly aimed at California because it individually targeted plaintiff in its forum state of 

California); Yahoo! Inc. v. La Ligue Contre Le Racisme Et L’Antisemitisme, 433 F.3d 1199, 1209 

(9th Cir. 2006) (a cease and desist letter alone does not justify the exercise of personal 

jurisdiction). Moreover, there is no indication that the subpoena would cause harm that was likely 

to be suffered in California. Plaintiff generally alleges that he was harmed as a result of the 

release of the financial records. Compl. at ¶¶ 58, 64, 70. While the financial records may have 

been released in California, the harm to Plaintiff personally should have been suffered in the state 

where he resides or works, neither of which is California. 

Accordingly, Plaintiff has failed to satisfy the Calder effects test to establish purposeful 

direction. Since Plaintiff failed to meet his burden to satisfy the first prong of the sufficient 

contacts test, this court declines to exercise specific personal jurisdiction over Deluca. 

2. RICO Defendants: Deluca, the Baker Firm, and the Baker Attorneys 

Plaintiff alleges RICO claims against Deluca, the Baker Firm, and the Baker Attorneys. 

As such, he alleges that personal jurisdiction is proper pursuant to 18 U.S.C. § 1965, which allows 

for nationwide jurisdiction under RICO. Compl. at ¶ 10. The RICO statute provides that a civil 

action may be instituted in the district in which the defendant “resides, is found, has an agent, or 

transacts his affairs.” 18 U.S.C. § 1965(a). In § 1965(b), Congress provided for service of process 

upon RICO defendants residing outside the federal court’s district when it is shown that “the ends 

of justice” require it. 18 U.S.C. § 1965(b); Butcher’s Union Local No. 498 v. SDC Inv., Inc., 788 

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ORDER GRANTING RULE 12(B)(1) AND 12(B)(2) MOTIONS TO DISMISS; DENYING AS 

MOOT RULE 12(B)(6) MOTIONS TO DISMISS; DENYING AS MOOT MOTIONS TO 

STRIKE

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F.2d 535, 538 (9th Cir. 1986). Through this provision, Congress intended “to enable plaintiffs to 

bring all members of a nationwide RICO conspiracy before a court in a single trial.” Butcher’s 

Union, 788 F.2d at 539. “For nationwide service to be imposed under section 1965(b), the court 

must have personal jurisdiction over at least one of the participants in the alleged multidistrict 

conspiracy and the plaintiff must show that there is no other district in which a court will have 

personal jurisdiction over all of the alleged co-conspirators.” Id. Plaintiff has the burden of 

showing affirmatively that there is no other district that could exercise jurisdiction over all of the 

alleged co-conspirators. Barantsevich v. VTB Bank, 954 F. Supp. 2d 972, 989-990 (C.D. Cal. 

2013). 

Deluca, the Baker Firm, and the Baker Attorneys argue that they lack significant contacts 

with California. Dkt. No. 27 at 9. They argue that the individual defendants are all residents of 

Ohio, and while the Baker Firm is a national law firm with an office in California, none of the 

legal services for Deluca were handled by the California office. Id. at 9-10. They further argue 

that the ends of justice is not served by conferring personal jurisdiction over them since their 

witnesses and records are located in Ohio, and the alleged claim occurred in Ohio. Id. at 10. In 

response, Plaintiff argues that the Baker Firm has substantial and continuous contact with 

California because of its office in Los Angeles, and the Baker Firm’s counsel works out of the Los 

Angeles office. Dkt. No. 36 at 9-10. 

This court agrees with Deluca, the Baker Firm and the Baker Attorneys. First, the court 

must have personal jurisdiction over at least one of the participants. There is no indication that 

this court can exercise personal jurisdiction over Deluca or the Baker Attorneys since they all live 

in Ohio, and Plaintiff has not made a case of specific personal jurisdiction over them. Second, 

even if this court can exercise personal jurisdiction over the Baker Firm because of some presence 

in California, Plaintiff has failed to allege that there is no other district court that will have 

personal jurisdiction over all of the RICO Defendants. The complaint states that Deluca and the 

Baker Attorneys are residents of Ohio, the Baker Firm has an office in Ohio, and at least part of 

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