Court Opinion

ID: 4103299
Source: CourtListenerOpinion
Date Created: 2016-11-30 17:07:18.101184+00
Date Added: 2024-06-11T09:20:45.547464
License: Public Domain

FILED
                                                                 Nov 30 2016, 9:11 am

                                                                      CLERK
                                                                  Indiana Supreme Court
                                                                     Court of Appeals
                                                                       and Tax Court

      ATTORNEY FOR APPELLANT
      Peter J. Sacopulos
      Sacopulos, Johnson & Sacopulos
      Terre Haute, Indiana

                                                 IN THE
          COURT OF APPEALS OF INDIANA

      Judi Simek,                                               November 30, 2016
      Appellant-Defendant,                                      Court of Appeals Case No.
                                                                10A01-1603-CT-412
      and                                                       Interlocutory Appeal from the
                                                                Clark Circuit Court
      Scott Everett,
                                                                The Honorable Andrew Adams,
      Defendant,                                                Judge
                                                                Trial Court Cause No. 10C01-
              v.                                                1212-CT-204

      Christopher Nolan d/b/a
      Lakeside Farm, LLC, and
      William P. McCall, III,
      Appellees-Plaintiffs

      Crone, Judge.

                                              Case Summary
[1]   Judi Simek brings an interlocutory appeal from the trial court’s denial of her

      motion to reconsider its previous denial of her motion to dismiss the claims
      Court of Appeals of Indiana | Opinion 10A01-1603-CT-412 | November 30, 2016           Page 1 of 11
      filed against her by Christopher Nolan d/b/a Lakeside Farm, LLC, and

      William P. McCall, III (collectively “the Plaintiffs”). Specifically, Simek asserts

      that dismissal is warranted pursuant to Indiana Rule of Trial Procedure

      12(B)(2) because the trial court lacks personal jurisdiction over her. We agree

      and therefore reverse and remand with instructions for the trial court to dismiss

      the Plaintiffs’ claims against Simek.

                                   Facts and Procedural History
[2]   The well-pleaded facts, both challenged and unchallenged, when viewed in the

      light most favorable to the Plaintiffs indicate that plaintiff Christopher Nolan,

      d/b/a Lakeside Farm, LLC, is a limited liability corporation located in and

      formed according to the laws of the State of Indiana. Plaintiff William P.

      McCall, III, resides in Sellersburg. At some point in time, Nolan contacted

      Scott Everett 1 via telephone regarding the possibility of Everett training two

      thoroughbred horses, Pacific Palisades and Cinnamon Beach, that were located

      in Indiana and owned by Nolan and McCall. Everett is a licensed

      thoroughbred trainer in the State of New York. Everett sent a third party to

      Indiana to evaluate the horses. Nolan and Everett subsequently entered into an

      oral contract which provided that Everett would train the horses and assume all

      costs of such training in exchange for a thirty-percent ownership in the horses.

      It was agreed that any purse money realized by the horses would be split

      1
        We note that defendant Scott Everett does not participate in this interlocutory appeal. However, we
      included him in the case caption because, pursuant to Indiana Appellate Rule 17(A), “A party of record in
      the trial court or Administrative Agency shall be a party on appeal.”

      Court of Appeals of Indiana | Opinion 10A01-1603-CT-412 | November 30, 2016                     Page 2 of 11
      equally minus jockey fees. Thereafter, the horses were transported by a third

      party from Indiana to Kentucky. Approximately eighty to ninety days later, the

      horses were transported from Kentucky to Florida. Everett took possession of

      the horses in Florida.

[3]   Sometime after August 11, 2010, Everett notified Nolan that Pacific Palisades

      was incapable of racing. Nolan and Everett determined that the horse would be

      given away. In February 2011, Everett notified Nolan that Cinnamon Beach

      had suffered a “career ending” broken foot injury. Appellant’s App. at 14.

      Based upon Everett’s representation of the injury, Nolan advised Everett “to

      obtain a good home for the horse as it was no longer capable of thoroughbred

      racing.” Id.

[4]   However, in early 2012, Nolan learned that Cinnamon Beach had competed in

      several thoroughbred races, all occurring outside of Indiana, and that the horse

      had won approximately $159,418 in purse money. When Nolan contacted

      Everett regarding what he had learned, Everett advised him that ownership of

      Cinnamon Beach had been transferred to Simek.

[5]   On December 28, 2012, the Plaintiffs filed a complaint for damages against

      Everett and Simek in the Clark Circuit Court. The complaint, sounding in

      contract and tort law, alleges that Everett “breached the oral contract for

      training services,” that Everett and Simek “committed fraud and

      misrepresentation concerning the condition of Cinnamon Beach,” and that

      Everett and Simek “converted the Plaintiffs[’] thoroughbred horse to their own

      Court of Appeals of Indiana | Opinion 10A01-1603-CT-412 | November 30, 2016   Page 3 of 11
      use without the knowledge and consent of the Plaintiffs ….” Id. at 16. 2 Everett

      and Simek subsequently filed a motion to dismiss pursuant to Indiana Trial

      Rule 12(B)(2) challenging the trial court’s personal jurisdiction over them. The

      Plaintiffs responded to the motion to dismiss, and the trial court heard

      argument from counsel for all parties at a hearing on February 3, 2014.

      Following the hearing, the trial court denied the motion to dismiss and directed

      “that depositions be taken of Mr. Nolan, Mr. Everett and Ms. Simek and lock

      in facts under oath. The Court will grant leave to renew the motion [to dismiss]

      once those facts are locked in under oath, subject to later discovery.” Id. at 6.

[6]   It appears from the record that no depositions were ever taken. On August 18,

      2015, Simek filed a motion to reconsider the motion to dismiss for lack of

      personal jurisdiction. In support of her motion to reconsider, Simek submitted

      her own affidavit as well as four additional affidavits, including that of her co-

      defendant Everett. In her personal affidavit, Simek avers that she is a resident

      of the State of New York. She states that she has never been to Indiana, does

      not know anyone in Indiana, does not possess any assets or real property in

      Indiana, has never conducted business in Indiana, has never had any

      communication with any business or individual located in Indiana, and has no

      2
        In addition to seeking damages for the current value of Cinnamon Beach and fifty percent of all purse
      monies won by Cinnamon Beach since November 2011, the Plaintiffs seek damages pursuant to Indiana
      Code Section 34-24-3-1, which provides that a person who “suffers a pecuniary loss as a result of a violation
      of [the criminal conversion statute]” may bring a civil action against the person who caused the loss to
      recover an amount not to exceed three times the actual damages of the person suffering the loss. We note
      that the Plaintiffs incorrectly cite the applicable statute in their complaint; we have provided the correct
      citation.

      Court of Appeals of Indiana | Opinion 10A01-1603-CT-412 | November 30, 2016                       Page 4 of 11
      intention, other than as necessary for the purposes of the current litigation, of

      entering Indiana. Id. at 107. Simek states that she had no involvement with or

      knowledge of Cinnamon Beach until the horse was physically present in New

      York. She further states that any investment or other transaction regarding her

      co-ownership of Cinnamon Beach with Everett occurred in New York, and that

      Everett has never, at any time, acted as her agent, employee, or representative

      in any capacity.

[7]   The trial court held a hearing on the motion to reconsider on December 15,

      2015. Following the hearing, the trial court entered an order again denying the

      motion to dismiss and ordering “previous discovery to be completed.” Id. at

      106. Upon Simek’s motion, the trial court stayed the discovery order as it

      applied to her and certified its order denying the motion to dismiss for

      interlocutory appeal. We accepted jurisdiction. Additional facts will be

      provided as necessary.

                                      Discussion and Decision
[8]   As a preliminary matter, we observe that the Plaintiffs did not file an appellees’

      brief. Where an appellee fails to file a brief, we do not undertake to develop

      arguments on that party’s behalf; rather, we may reverse upon a prima facie

      showing of reversible error. Morton v. Ivacic, 898 N.E.2d 1196, 1199 (Ind.

      2008). Prima facie error is error “at first sight, on first appearance, or on the

      face [of] it.” Id. The “prima facie error rule” relieves this Court from the

      burden of controverting arguments advanced for reversal, a duty which remains

      Court of Appeals of Indiana | Opinion 10A01-1603-CT-412 | November 30, 2016   Page 5 of 11
       with the appellee. Geico Ins. Co. v. Graham, 14 N.E.3d 854, 857 (Ind. Ct. App.

       2014). Nevertheless, we are obligated to correctly apply the law to the facts in

       the record in order to determine whether reversal is required. Id.

[9]    Simek contends that the trial court erred in denying her motion to reconsider

       her motion to dismiss for lack of personal jurisdiction pursuant to Indiana Trial

       Rule 12(B)(2). A motion to dismiss pursuant to Trial Rule 12(B)(2) is a proper

       method for challenging the personal jurisdiction of a trial court. LinkAmerica

       Corp. v. Cox, 857 N.E.2d 961, 965 (Ind. 2006). The existence of personal

       jurisdiction is a question of law that we review de novo. Id. While we do not

       defer to a trial court’s legal conclusion regarding the existence of personal

       jurisdiction, whether “personal jurisdiction exists turns on facts, namely the

       extent of a defendant’s contacts with the forum, and ordinarily a trial court’s

       factual findings on that point would be reviewed for clear error.” Wolf’s Marine

       Bar, Inc. v. Brar, 3 N.E.3d 12, 15 (Ind. Ct. App. 2014).

[10]   Here, in denying Simek’s motion to dismiss and her motion to reconsider, the

       trial court made no findings of jurisdictional facts. Where the trial court does

       not find jurisdictional facts, “we may accept the plaintiff’s well-pleaded facts to

       the extent they are not challenged, and we may view challenged facts in favor of

       the plaintiff.” JPMorgan Chase Bank, N.A. v. Desert Palace, Inc., 882 N.E.2d 743,

       747 (Ind. Ct. App. 2008), trans. denied. The party challenging the trial court’s

       personal jurisdiction bears “the burden of establishing the lack thereof by a

       preponderance of the evidence.” Id. at 748. “We presume jurisdiction exists

       Court of Appeals of Indiana | Opinion 10A01-1603-CT-412 | November 30, 2016   Page 6 of 11
       until the defendant comes forth with evidence sufficient to challenge

       jurisdiction.” Id.

[11]   We note that the Plaintiffs’ complaint mentions few facts that are relevant to

       the personal jurisdiction question. We also note that the Plaintiffs’ response to

       Simek’s motion to dismiss challenging personal jurisdiction primarily addresses

       facts relevant to the court’s jurisdiction over Everett. As for the affidavits

       submitted by Simek in support of her motion to reconsider, they stand

       unopposed by the Plaintiffs, as does Simek’s account of the underlying facts

       provided in her brief on appeal. With this in mind, we turn to our de novo

       review.

[12]   Recently, our supreme court reiterated Indiana’s approach to personal

       jurisdiction as follows:

               Personal jurisdiction refers to a court’s power to impose
               judgment on a particular defendant. In Indiana, personal
               jurisdiction analysis begins with Indiana Trial Rule 4.4(A), which
               sets out examples of activities that often support jurisdiction. It
               also provides that “a court of this state may exercise jurisdiction
               on any basis not inconsistent with the Constitutions of this state
               or the United States.”

               In LinkAmerica Corp. v. Cox, we interpreted this catchall “any
               basis” provision to “reduce analysis of personal jurisdiction to the
               issue of whether the exercise of personal jurisdiction is consistent
               with the federal Due Process Clause.” 857 N.E.2d at 967. More
               specifically, before an Indiana court can properly assert personal
               jurisdiction over a defendant, the Due Process Clause of the
               Fourteenth Amendment mandates that the defendant have
               “certain minimum contacts with the state such that the

       Court of Appeals of Indiana | Opinion 10A01-1603-CT-412 | November 30, 2016   Page 7 of 11
               maintenance of the suit does not offend traditional notions of fair
               play and substantial justice.” Id. (citing Int'l Shoe Co. v. Wash., 326
               U.S. 310, 316 (1945)). Minimum contacts include acts defendants
               themselves initiate within or without the forum state that create a
               substantial connection with the forum state itself. See Burger King
               Corp. v. Rudzewicz, 471 U.S. 462, 475 (1985); see also Anthem Ins.
               Cos., Inc. v. Tenet Healthcare Corp., 730 N.E.2d 1227, 1235 (Ind.
               2000), superseded on other grounds by LinkAmerica.

               The “minimum contacts” test of International Shoe and its
               progeny ensures that a defendant’s contacts with Indiana make
               an Indiana court’s exercise of personal jurisdiction fair and just.
               LinkAmerica, 857 N.E.2d at 967 (citing Int'l Shoe Co., 326 U.S. at
               316). To state this another way, due process requires that
               potential out-of-state defendants be able to predict what conduct
               might make them liable in our courts. Burger King, 471 U.S. at
               472 (quoting World-Wide Volkswagen Corp. v. Woodson, 444 U.S.
               286, 297 (1980)). See also Int'l Shoe Co., 326 U.S. at 319; Anthem
               Ins. Cos., 730 N.E.2d at 1235-36. “The Due Process Clause ...
               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.” WorldWide Volkswagen, 444 U.S.
               at 297 (citation omitted). Consistent with this longstanding
               precedent, Indiana courts will employ caution and exert
               potentially coercive legal authority only over a defendant who
               has the requisite minimum contacts to Indiana. Int'l Shoe Co., 326
               U.S. at 316 (citing Pennoyer v. Neff, 95 U.S. 714 (1877)).

       Boyer v. Smith, 42 N.E.3d 505, 509 (Ind. 2015) (parallel citations omitted).

[13]   There are two types of personal jurisdiction: general and specific. If the

       defendant’s contacts with the state are so “continuous and systematic” that the

       defendant should reasonably anticipate being haled into the state’s courts for

       Court of Appeals of Indiana | Opinion 10A01-1603-CT-412 | November 30, 2016   Page 8 of 11
       any matter, the defendant is subject to general jurisdiction. LinkAmerica, 857

       N.E.2d at 967 (citing Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S.

       408, 415 n. 9 (1984)). If the defendant’s contacts with the state are not

       “continuous and systematic,” the defendant may be subject to specific

       jurisdiction “if the controversy is related to or arises out of the defendant’s

       contacts with the forum state.” Id. (citing Helicopteros, 466 U.S. at 414 & n. 8).

[14]   In this case, the only possible basis for the trial court to exercise jurisdiction

       over Simek would be specific jurisdiction. “Specific jurisdiction exists when a

       lawsuit arises from or is closely related to a defendant’s minimum contacts with

       or substantial connection to the forum state.” Boyer, 42 N.E.3d at 510. In other

       words, specific jurisdiction requires purposeful availment. Id. A single contact

       with the forum state may be sufficient to establish specific jurisdiction over a

       defendant, if it creates a “substantial connection” with the forum state and the

       suit is related to that connection. McGee v. Int'l. Life Ins. Co., 355 U.S. 220, 223

       (1957). However, a defendant cannot 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.” Burger King, 471 U.S. at 476-77 (internal

       quotation marks omitted) (citing Helicopteros, 466 U.S. at 417; Keeton v. Hustler

       Magazine, Inc., 465 U.S. 770, 774 (1984); WorldWide Volkswagen Corp., 444 U.S.

       at 299).

[15]   When evaluating a defendant’s contacts with the forum state, a court should

       consider:

       Court of Appeals of Indiana | Opinion 10A01-1603-CT-412 | November 30, 2016   Page 9 of 11
                (1) whether the plaintiff’s claim arises from the defendant’s forum
                contacts; (2) the overall contacts of the defendant or its agent
                with the forum state; (3) the foreseeability of being haled into
                court in that state; (4) who initiated the contacts; and (5) whether
                the defendant expected or encouraged contacts with the state.

       Wolf’s Marine, 3 N.E.3d at 15. “[M]inimum contacts analysis focuses on the

       relationship among the defendant, the forum, and the litigation.” Boyer, 42

       N.E.3d at 510 (citations and quotation marks omitted). That is to say, a

       defendant’s “suit-related conduct” must create a substantial connection to the

       forum State.” Id. Indeed, “a substantial connection to Indiana is the

       touchstone, because that is the only way defendants can reasonably anticipate

       being called into court here to defend themselves.” Id. at 511. 3

[16]   Without question, we think that Simek has proved the trial court’s lack of

       personal jurisdiction by a preponderance of the evidence. Not only has Simek

       had insufficient contact with the State of Indiana to establish specific

       jurisdiction, she has had no contact with Indiana whatsoever. It is undisputed

       that Simek has never been to Indiana and has never owned, operated, or

       conducted any business in Indiana. It is undisputed she was not a party to any

       negotiations or resulting oral contract with the Plaintiffs regarding the training

       or ownership of Cinnamon Beach, and in her uncontested affidavit, Simek

       3
         Even if a defendant’s contacts are sufficient to confer personal jurisdiction, due process requires that the
       assertion of jurisdiction over the defendant be reasonable. LinkAmerica, 857 N.E.2d at 967. Because we
       conclude that Simek did not have sufficient minimum contacts with Indiana, we need not reach the
       reasonableness inquiry.

       Court of Appeals of Indiana | Opinion 10A01-1603-CT-412 | November 30, 2016                         Page 10 of 11
       avers that she had no involvement with or knowledge of Cinnamon Beach until

       the horse was physically present in New York. Simek also avers that Everett is

       not and never has been her agent or representative for any purpose.

[17]   Simek’s sole relationship with this litigation is the fact that she appears to have

       a current business arrangement with Everett regarding the ownership of

       Cinnamon Beach. There are no facts to indicate that she personally initiated,

       expected, or encouraged contacts with Indiana such that she could have

       reasonably foreseen being haled into court here. This case is a prime example

       of when a defendant cannot be haled into a jurisdiction solely as a result of the

       unilateral activity of another party and/or a third person. Simply put, Simek

       does not have a substantial connection to Indiana, and therefore she cannot be

       said to have purposely availed herself of the trial court’s jurisdiction.

[18]   In sum, Indiana lacks specific jurisdiction over Simek. Her alleged conduct,

       even when viewed in the light most favorable to the Plaintiffs, did not establish

       a substantial connection between herself and this State, and thus cannot support

       personal jurisdiction. Simek has established prima facie error in the trial court’s

       denial of her motion to reconsider her motion to dismiss for lack of personal

       jurisdiction. Consequently, we reverse and remand with instructions for the

       trial court to dismiss the Plaintiffs’ claims against Simek.

[19]   Reversed and remanded.

       Kirsch, J., and May, J., concur.

       Court of Appeals of Indiana | Opinion 10A01-1603-CT-412 | November 30, 2016   Page 11 of 11