Filed 11/19/20 Ghuman v. Gronager CA4/1

NOT TO BE PUBLISHED IN OFFICIAL REPORTS

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or ordered published for purposes of rule 8.1115. 

COURT OF APPEAL, FOURTH APPELLATE DISTRICT

DIVISION ONE

STATE OF CALIFORNIA

SUKHJIT SINGH GHUMAN,

Plaintiff and Appellant,

v.

TOMAS GRONAGER et al.,

Defendants and Respondents.

 D076788

 (Super. Ct. No. 37-2018-

00055048-CU-FR-CTL)

APPEAL from an order of the Superior Court of San Diego County, 

Katherine A. Bacal, Judge. Affirmed.

Gregor Law Offices, T. Steven Gregor; Burke, Williams & Sorensen and 

Matthew D. Murphey for Plaintiff and Appellant.

Dart Law and Matthew B. Dart for Defendants and Respondents.

I

INTRODUCTION

Sukhjit Singh Ghuman, a citizen of the United Kingdom (UK) who 

resided part time in California, sued six UK residents for fraud and 

intentional interference with contract alleging they conspired to defraud him
2

in a deal to sell his UK business to another UK business by paying him less 

than he believed he was owed. Ghuman appeals an order of the trial court 

granting the defendants’ motion to quash service of the summons and 

complaint for lack of personal jurisdiction. We conclude the court properly 

determined the defendants lacked minimum contacts with California to 

exercise personal jurisdiction over them. We, therefore, affirm the order.

II

BACKGROUND

A

Ghuman was the sole owner and chief executive officer of a UK 

company, Octavian Continental Ltd. (Octavian), which provided private 

security services to businesses in the UK. Earl Knight and Nathan Potter 

were directors of Octavian. 

Ghuman, who is still a UK citizen, moved from the UK to the United 

States in 2013. Since 2014, he has split his time living in both San Diego and 

Arizona. 

John McRoberts was an investor and director in another UK company, 

CE Facilities Services (CE Facilities). Tomas Gronager, Trevor East, and 

Tony Hallet were directors of CE Facilities. 

Gronager called Ghuman on his mobile phone in the Fall of 2014 while 

Ghuman and his wife were driving from San Diego to Del Mar. Gronager 

said he was the chief executive officer of CE Facilities, which provided private 

security and janitorial services. He said CE Facilities was interested in 

buying Octavian. Gronager said McRoberts was going to invest £100 million 

to expand CE Facilities, which potentially included buying Octavian. They 

were interested in buying Octavian because it had a good reputation in the 
3

industry. He also said the fact Ghuman had moved to California was 

attractive because Ghuman would not compete with them in the UK.

Negotiations to purchase Ghuman’s shares of Octavian occurred over a 

period of nine months and were finalized in August 2015. Ghuman, who was 

in California for most of the negotiations, participated by video conference, 

email, and telephone. The other Octavian directors, Potter and Knight, also 

participated in the negotiations and were aware Ghuman was in California. 

Ghuman made it known during the negotiations that he planned to use 

the proceeds from his sale of Octavian to fund new businesses in California 

and Arizona. He said the parties anticipated he would receive additional 

compensation to act as an independent consultant for CE Facilities.

CE Facilities purchased Ghuman’s stock for approximately $4 million. 

Ghuman was to receive deferred payments over three years consisting of “a 

mixture of loan notes and deferred consideration for the new business that 

was coming in.” Ghuman expected to receive the payments in California. 

Ghuman and CE Facilities memorialized the deal in a share purchase 

agreement, which Ghuman executed in the UK. The purchase agreement 

contained a choice of law provision stating, “This Agreement and any dispute 

or claim arising out of or in connection with it or its subject matter or 

formation (including non-contractual disputes or claims) shall be governed by 

and construed in accordance with the law of England and Wales.” The 

parties agreed that the courts of England and Wales “shall have exclusive 

jurisdiction to settle any dispute or claim arising out of or in connection with 

this Agreement or its subject matter or formation (including non-contractual 

disputes or claims).”1

1 We deny defendants’ opposed request for us to take judicial notice of a 

complete copy of the share purchase agreement. The record contains a true 
4

CE Facilities rebranded Octavian as CE Security. Knight and Potter 

became directors and managers of the newly formed CE Security. 

Ghuman received the first deferred payment, but he claims CE 

Facilities failed to make subsequent payments. He claims a company he 

tried to start in California is no longer in business, “primarily because CE 

Facilities failed to make the payments” under the share purchase agreement. 

B

1

Ghuman sued Gronager, Hallet, East, McRoberts, Knight, and Potter

(collectively defendants) in October 2018 for fraud and intentional 

interference with contract. The defendants all reside in the UK.

Ghuman alleged he elected to sell a company he owned in the UK “[i]n 

part because of his relocation.” He alleged he was assured a substantial 

investment would be made in the company after he sold his shares and he 

believed “he would be paid in full for his shares.” He alleged he was not paid 

all he believed he was owed for his shares and estimated he was still owed 

approximately £2.4 million or $3 million. He alleged the defendants 

conspired with one another, had no intention of paying Ghuman the 

obligations due, and misled him to sell his shares in the company for less 

than he believed he was owed. 

and correct copy of excerpted portions of the agreement, which was attached 

to McRobert’s declaration in support of the motion to quash. “Reviewing 

courts generally do not take judicial notice of evidence not presented to the 

trial court.” (Vons Companies, Inc. v. Seabest Foods, Inc. (1996) 14 Cal.4th 

434, 444, fn. 3 (Vons Companies).) No exceptional circumstances exist here to 

justify departure from this rule. (Ibid.)
5

2

The defendants specially appeared to move to quash service of the 

summons and complaint for lack of personal jurisdiction pursuant to Code of 

Civil Procedure section 418.10, subdivision (a)(1) on the basis that they are 

not residents of California, were not served in California, did not consent to 

California’s jurisdiction, and lack the requisite minimum contacts with the 

state for California to assert personal jurisdiction over them. 

Each defendant submitted declarations regarding their lack of contact 

with the State of California. Gronager visited California once for vacation in 

1985. East visited California on a holiday, but has not been to California for 

business since the 1990s. McRoberts visited California in 1997 on a holiday 

and in 2018 to visit friends and to visit a subsidiary of a UK company for 

which he worked. Potter made two short visits to California in 2014 and has 

not been back since. Hallet and Knight have never been to California. The 

defendants argued they did nothing to avail themselves of the benefits of 

California because the transaction pertained to a UK company and the 

agreement, which was signed in the UK, vests exclusive jurisdiction in UK 

courts. 

The defendants also asserted Ghuman filed this litigation after he was 

found liable in a lawsuit in the UK filed by CE Facilities and he failed to pay 

damages in that case. Ghuman sought bankruptcy protection in the UK and 

was declared bankrupt, arguably making this matter an asset of the 

bankruptcy estate. 

3

Ghuman opposed the motion to quash contending the forum selection 

clause in the purchase agreement was not enforceable and the court should 

exercise jurisdiction over the defendants because they knew he was in 
6

California before, during, and after negotiating the purchase of the company, 

they paid Ghuman in California, and Ghuman was injured in California by 

their alleged breach of the agreement. He submitted his own declaration 

regarding the negotiations for the company and the defendants’ knowledge 

that he lived in California. He also submitted a declaration of a third party 

who participated in the negotiations and later helped establish businesses for 

Ghuman in California and Arizona. 

Ghuman alternatively asked the court to continue the hearing on the 

motion to quash to allow jurisdictional discovery. According to Ghuman’s 

declaration, Octavian had an email server that archived email 

communications every three months on a drive called the Barracuda 

Archiver. He estimated the Barracuda Archiver contains over 1,000 email 

communications and other documents regarding the negotiations and the 

share purchase agreement. He believed those documents would show “that 

all of the defendants in this case knew that [he] was living in California 

during and after the negotiations” and that one of the reasons he agreed to 

sell Octavian was because he was going to use the funds to start other 

businesses in California and Arizona. Ghuman claimed CE Facilities blocked 

his access to the archiver because of the litigation pending in the UK. 

Ghuman wanted the court to order discovery from the archiver on the issue of 

jurisdiction. He also claimed the archiver would “demonstrate the 

defendants’ fraud.” 

4

The trial court granted the motion to quash. The court noted that 

although Ghuman participated in negotiations by video conference, email, 

and telephone while he was in California, some negotiations must have taken 

place elsewhere since Ghuman signed the agreement in the UK.
7

The court observed Octavian provided services overseas and there was 

no evidence any work was to be done in California. The purchase agreement 

“concerned the acquisition of one United Kingdom company by another 

United Kingdom company, and all of the defendants reside in the U.K.” In 

addition, the court considered the choice of law provision in the agreement 

designating the courts of England and Wales to have exclusive jurisdiction. 

The court concluded the “purpose of the transaction was to acquire a 

UK company that conducted no activities in California.” The court 

determined the fact Ghuman intended to use the money to start businesses in 

California and Arizona was incidental. As a result, the court concluded the 

circumstances did not support the conclusion defendants engaged in wrongful 

conduct purposely directed at California. 

The court also denied the request to continue the hearing to conduct 

jurisdictional discovery. The court determined the requested discovery did 

not appear tailored to address the jurisdictional issue. This portion of the 

order is the subject of a separate appeal. 

III

DISCUSSION

A

General Principles

“California's long-arm statute authorizes California courts to exercise 

jurisdiction on any basis not inconsistent with the Constitution of the United 

States or the Constitution of California. (Code Civ. Proc., § 410.10.) A state 

court’s assertion of personal jurisdiction over a nonresident defendant who 

has not been served with process within the state comports with the 

requirements of the due process clause of the federal Constitution if the 

defendant has such minimum contacts with the state that the assertion of
8

jurisdiction does not violate ‘ “traditional notions of fair play and substantial 

justice.” ’ ” (Vons Companies, supra, 14 Cal.4th at p. 444, quoting 

International Shoe Co. v. Washington (1945) 326 U.S. 310, 316.)

There are “two types of personal jurisdiction: ‘general’ (sometimes 

called ‘all-purpose’) jurisdiction and ‘specific’ (sometimes called ‘case-linked’) 

jurisdiction.” (Bristol-Myers Squibb Co. v. Superior Court (2017) 582 U.S. ___ 

[198 L. Ed. 2d 395, 137 S.Ct. 1773, 1779–1780].) The parties agree only 

specific jurisdiction is at issue in this case.

“ ‘When a defendant moves to quash service of process’ for lack of 

specific jurisdiction, ‘the plaintiff has the initial burden of demonstrating 

facts justifying the exercise of jurisdiction.’ [Citation.] ‘If the plaintiff meets 

this initial burden, then the defendant has the burden of demonstrating “that 

the exercise of jurisdiction would be unreasonable.” ’ ” (Snowney v. Harrah’s 

Entertainment, Inc. (2005) 35 Cal.4th 1054, 1062 (Snowney).) Because there 

is no dispute regarding the jurisdictional facts, we independently review 

whether the defendants’ contacts with California are sufficient to justify the 

exercise of specific personal jurisdiction. (Ibid.)

Specific jurisdiction requires “some nexus between the cause of action 

and the defendant’s activities in the forum state.” (Brue v. Al Shabaab (2020) 

54 Cal.App.5th 578, 589 (Brue).) “When determining whether specific 

jurisdiction exists, courts consider the ‘ “relationship among the defendant,

the forum, and the litigation.” ’ [Citation.] A court may exercise specific 

jurisdiction over a nonresident defendant only if: (1) ‘the defendant has 

purposefully availed himself or herself of forum benefits’ [citation]; (2) ‘the 

“controversy is related to or ‘arises out of’ [the] defendant’s contacts with the 

forum” ’ [citation]; and (3) ‘ “the assertion of personal jurisdiction would 
9

comport with ‘fair play and substantial justice’ ” ’ [citations].” (Pavlovich v. 

Superior Court (2002) 29 Cal.4th 262, 269 (Pavlovich).)

B

Analysis

1

“Due process requires purposeful availment because it ‘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.’ ” (Thurston v. 

Fairfield Collectibles of Georgia, LLC (2020) 53 Cal.App.5th 1231, 1237 

(Thurston), quoting World-Wide Volkswagen Corp. v. Woodson (1980) 444 

U.S. 286, 297.) “ ‘The purposeful availment inquiry ... focuses on the 

defendant’s intentionality. [Citation.] This prong is only satisfied when the 

defendant purposefully and voluntarily directs his activities toward the 

forum so that he should expect, by virtue of the benefit he receives, to be 

subject to the court’s jurisdiction based on’ his contacts with the forum. 

[Citation.] Thus, 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 [citations], or of the “unilateral activity 

of another party or a third person.” [Citations.]’ [Citation.] ‘When a 

[defendant] “purposefully avails itself of the privilege of conducting activities 

within the forum State,” [citation], it has clear notice that it is subject to suit 

there, and can act to alleviate the risk of burdensome litigation by procuring 

insurance, passing the expected costs on to customers, or, if the risks are too 

great, severing its connection with the State.’ [Citation.]” (Pavlovich, supra,
10

29 Cal.4th at p. 269.) We assess the contacts of each defendant individually 

with the state. (Calder v. Jones (1984) 465 U.S. 783, 790 (Calder).)

Ghuman contends the defendants purposefully availed themselves of 

the benefits of doing business in California based on the following facts:

(1) Gronager called Ghuman in California; (2) CE Facilities was interested in 

purchasing Octavian because Ghuman would not compete with CE Facilities 

in the UK after selling Octavian because he lived in California; (3) the parties 

engaged in months of negotiations by phone, video conference, and email 

knowing Ghuman was primarily in California; (4) the defendants agreed to 

pay Ghuman with deferred payments, which Ghuman expected to receive in 

California; (5) the defendants knew Ghuman intended to use the proceeds to 

start companies in California and Arizona; and (6) the parties anticipated 

Ghuman would provide ongoing consulting services to CE Facilities for 

additional compensation. He claims the defendants “aimed their intentional 

acts at California and knew that Ghuman would suffer harm in California as 

a result of such acts.” We are not persuaded. 

Accepting these facts as true for purposes of the jurisdictional analysis, 

they do not show the defendants attempted to avail themselves of any 

privilege related to conducting business in California. Although Ghuman 

may have been physically in the State of California for most of the 

negotiations, the contract itself was executed in the UK and vested 

jurisdiction for any matters–contractual or non-contractual–related to the 

contract or its formation in the courts of England and Wales. 

The relationship of the defendants to California was attenuated at best. 

This was a deal for one UK company to purchase another UK company. The 

benefits of the transaction to the defendants were intended to manifest in the 

UK rather than in California. Gronager’s alleged representation that 
11

McRoberts intended to invest capital into CE Facilities was to expand its 

business in the UK. Gronager said the benefit of Ghuman living outside the 

UK was that he would not compete with CE Facilities or the newly branded 

company in the UK. This had no bearing on Ghuman’s presence in 

California; the defendants would obtain the same benefit if he was in Arizona 

or Denmark. Likewise, the benefit to defendants of deferred payments would 

exist no matter where Ghuman resided. 

Ghuman provided no evidence that any subsequent consulting service 

he might provide to CE Facilities had anything to do with his presence in 

California or would involve any business activity by the defendants in 

California. According to Ghuman, Gronager said Ghuman had a good 

reputation in the security service industry in the UK. Presumably this would 

be the reason they might ask him to provide consulting services for its UK 

businesses. 

Even if the defendants knew Ghuman intended to start his own new

business in California with the proceeds from the sale of Octavian, he did not 

show the defendants had any interest in a potential California business or 

would otherwise benefit from such a business. The only potential connection 

Ghuman offers in this regard is his claim that he and Potter discussed Potter 

joining him in California and discussed providing services to an existing

client of Octavian in Arizona and California. However, both Ghuman and 

Potter state Potter’s two brief visits to California in 2014 predated any 

negotiations with CE Facilities. Potter subsequently became a director in CD 

Facilities’ newly branded company in the UK. Therefore, there is no evidence 

the purchase agreement in this case contemplated Potter, or any other 

defendant, had any business interest in a California corporation. Ghuman’s 
12

unilateral action in forming a California business does not subject the 

defendants to personal jurisdiction. (Pavlovich, supra, 29 Cal.4th at p. 269.)

These facts are distinguishable from cases in which an out-of-state 

company advertises in various mediums in California or maintains a Web 

site to solicit California customers to sell goods or services to California 

residents. (Snowney, supra, 35 Cal.4th at pp. 1060, 1065 [jurisdiction proper 

for hotel chain that advertised to California residents with billboards as well 

as print and digital media and maintained a Web site for reservations with 

directions from California]; Thurston, supra, 53 Cal.App.5th at p. 1240 [sales 

of goods or services to California residents via a Web site and catalog 

constitutes purposeful availment for jurisdiction]; but see Pavlovich, supra, 

29 Cal.4th at pp. 266, 274 [posting a code containing proprietary information 

on an Internet Web site was insufficient for jurisdiction].) The facts here are 

also different from cases in which an insurance company agrees to cover 

potential risks or losses in California knowing it should expect to be subject 

to litigation in the state (Greenwell v. Auto-Owners Ins. Co. (2015) 233 

Cal.App.4th 783, 795), or where a foreign insurance broker targets a 

California insurance brokerage firm to place policies in California, 

purposefully availing itself of the privilege and opportunity to do business in 

California. (Harris Rutsky & Co. Ins. Servs. v. Bell & Clements Ltd. (9th Cir. 

2003) 328 F.3d 1122, 1127, 1130.) 

Finally, they are unlike the case of Calder, supra, 465 U.S. at 

pages 788–789, where the United States Supreme Court concluded it was 

appropriate for California to exercise jurisdiction over a Florida newspaper 

where the “libelous story concerned the California activities of a California 

resident. It impugned the professionalism of an entertainer whose television 

career was centered in California. The article was drawn from California 
13

sources, and the brunt of the harm, in terms both of [the entertainer’s]

emotional distress and the injury to her professional reputation, was suffered 

in California. In sum, California [was] the focal point both of the story and of 

the harm suffered. Jurisdiction over [the newspaper] [was] therefore proper 

in California based on the ‘effects’ of their Florida conduct in California.”

Ghuman’s allegation that he did not receive the payments he expected 

in California is not sufficient to establish jurisdiction. “[M]ost courts agree 

that merely asserting that a defendant knew or should have known that his 

intentional acts would cause harm in the forum state is not enough to 

establish jurisdiction under the effects test.” (Pavlovich, supra, 29 Cal.4th at 

pp. 270–271.) “[T]he Calder effects test requires intentional conduct

expressly aimed at or targeting the forum state in addition to the defendant's 

knowledge that his intentional conduct would cause harm in the forum.” (Id. 

at p. 271.) There is no evidence the defendants intentionally or expressly 

aimed any alleged misconduct toward California.

2

The controversy has no relationship to any contact by the defendants

with California. “[T]he relatedness requirement is satisfied if ‘there is a 

substantial nexus or connection between the defendant's forum activities and 

the plaintiff's claim.’ ” (Snowney, supra, 35 Cal.4th at p. 1068.) “ ‘ “ ‘[O]nly 

when the operative facts of the controversy are not related to the 

defendant[s’] contact with the state can it be said that the cause of action 

does not arise from that [contact].’ ” ’ ” (Ibid.) 

As discussed ante, there is no evidence the defendants had any 

business interest in California or that they intentionally directed their 

conduct toward California or its residents in general. Ghuman’s claims of 

fraud and intentional interference with contract arose from a deal between 
14

foreign citizens regarding their interests in foreign businesses. His 

allegations the defendants misled him into selling his UK business for less 

than he believed he would be paid have nothing to do with any activity of the 

defendants in California. “[W]hen no relationship exists between the 

defendant’s contacts with the forum state and the specific claims at issue, the 

court may not exercise specific jurisdiction ‘regardless of the extent of the 

defendant's unconnected activities in the State.’ ” (Brue, supra, 54 

Cal.App.5th at p. 592.)

3

Because we determine Ghuman has not met his burden of establishing 

the purposeful availment or relatedness requirements, we need not reach the 

issue of “whether the assertion of specific jurisdiction is fair.” (Vons 

Companies, supra, 14 Cal.4th at pp. 475–476.) Nevertheless, we note each of 

the defendants submitted evidence regarding their minimal to non-existent 

physical visits to California along with the forum selection clause of the 

purchase agreement. Ghuman does not dispute this evidence other than to 

say that the defendants should not get the benefit of the forum selection 

clause because they were not individual signatories. Ghuman has not 

established exercise of personal jurisdiction over the defendants would be 

reasonable or fair in this case simply because he claims he did not receive the 

payments he expected in this deal regarding foreign companies. 
15

IV

DISPOSITION

The order granting the motion to quash service of summons is affirmed. 

Respondents shall recover their costs on appeal.

McCONNELL, P. J.

WE CONCUR:

BENKE, J.

IRION, J.