Court Opinion

ID: 9871606
Source: CourtListenerOpinion
Date Created: 2023-09-26 20:36:51.343473+00
Date Added: 2024-06-11T07:46:20.233912
License: Public Domain

Manzanet-Daniels, J.,
dissents in part in a memorandum as follows: I disagree with the majority that the motion court properly dismissed the complaint in its entirety against defendant Wampler on jurisdictional grounds. In my view, plaintiff has sufficiently alleged that Wampler is subject to long-arm jurisdiction under CPLR 302 (a) (1).
“[A] court may exercise personal jurisdiction over any non-*658domiciliary . . . who in person or through an agent . . . transacts any business within the state or contracts anywhere to supply goods or services in the state” (CPLR 302 [a] [1]). “[P]roof of one transaction in New York is sufficient to invoke jurisdiction, even though the defendant never enters New York, so long as the defendant’s activities here were purposeful and there is a substantial relationship between the transaction and the claim asserted” (Deutsche Bank Sec., Inc. v Montana Bd. of Invs., 7 NY3d 65, 71 [2006], cert denied 549 US 1095 [2006]; Kreutter v McFadden Oil Corp., 71 NY2d 460, 467 [1988]).
The third amended complaint sufficiently alleges that Wampler “transacted” business through his New York agents PSNY and Gasarch. Plaintiffs allege that Wampler was in daily communication with PSNY’s New York office concerning the subject oil exploration partnerships and the drilling operations of affiliated overseas entities. Plaintiffs allege that Wampler instructed Gasarch concerning account distributions and “routinely” directed Gasarch to withdraw investor funds from PSNY and transfer them to defendants’ personal accounts. PSNY and Gasarch acted “for the benefit of and with the knowledge and consent of [the] defendant [ ] and that [defendant] exercised some control over [the agent] in the matter” so as to subject Wampler to jurisdiction under the long-arm statute (Kreutter, 71 NY2d at 467).
The majority maintains that plaintiffs’ allegations are conclusory and unsubstantiated. However, the majority fails to meaningfully distinguish the allegations in this case from those found to be sufficient in other cases involving the transaction of business through an agent within the meaning of the long-arm statute (see e.g. Kreutter, 71 NY2d 460 [Texas defendants which marketed oil investments through New York corporate agent transacted business within the meaning of the long-arm statute]; Holmes v First Meridian Planning Corp., 155 AD2d 813 [3d Dept 1989] [Florida mortgage company transacted business through New York corporate agent alleged to have falsely represented the value of certain condominiums where the New York agent received commissions from the Florida company and solicited business for it by advising the plaintiffs of the availability of obtaining a mortgage from the Florida company]).
Wampler’s argument that he is not an alter-ego of PSNY, while relevant to the issue of substantive liability, is not relevant to the issue of whether he transacted business through an agent so as to subject him to personal jurisdiction (see Kreutter at 469-470).
*659Further, plaintiffs allege that Wampler himself personally solicited plaintiffs’ investment in the funds during several visits to New York in 2006 and 2007. Gonsalves alleges that Wampler met with him in New York in 2006 “to describe the oil wells to be drilled in Trinidad — while knowing that no such wells would ever be drilled.” During this meeting, Wampler “pointed to the past ‘success’ of the drilling programs since 2003, the number of wells drilled, the amount of production, and the revenues earned as evidence of the program’s viability and robustness.” These representations were allegedly “false and deliberately contrived by Wampler” to induce Gonsalves and potential investors to invest in the Trinidad operations.
Gonsalves alleges that Wampler met with him in 2007 at PSNY’s New York offices, to “describ[e] the quick profit from” Coast to Coast Energy, which Gonsalves and Wampler formed in 2005, as well as “the continued supply of new investors, and the time needed for fund raising [sic] to continue.”
Plaintiffs also allege that Wampler and Gasarch met Rus-sack at PSNY’s New York offices in May 2005 “for the purpose of selling an interest in a drilling rig to Russack, as part of [the] oil equipment scheme.” Wampler allegedly “pointed to the prior successes of the oil exploration partnerships as evidence of the viability and legitimacy of the oil equipment investment, while knowing that such evidence was completely fabricated and false.”
Plaintiffs sufficiently allege that Wampler “transacted business” within the meaning of the long-arm statute (see e.g. Corporate Campaign v Local 7837, United Paperworkers Intl. Union, 265 AD2d 274 [1st Dept 1999] [daily communication, together with 12 trips to New York by the defendant’s representatives, subjected the defendant to long-arm jurisdiction]; Urfirer v SB Bldrs., LLC, 95 AD3d 1616, 1618 [3d Dept 2012] [allegations that the defendant extensively communicated with subcontractors electronically and via telephone and traveled to New York to supervise the project sufficient to withstand motion to dismiss]; Stardust Dance Prods., Ltd. v Cruise Groups Intl., Inc., 63 AD3d 1262 [3d Dept 2009] [attendance at two meetings in 2007, during which the defendant was alleged to have solicited travelers for dance cruises by displaying promotional materials and responding to inquiries, raised a question concerning whether the defendant had transacted business within the meaning of the statute]). While the oil exploration partnerships may have been located in the Caribbean, the complaint alleges that Wampler met with investors in New York for the purposes of soliciting their participation in *660the venture, and to sell interests in a drilling rig as part of the alleged scheme. I would accordingly reverse the order appealed to the extent it dismissed the claims against Wampler.
The cases upon which the majority relies in finding otherwise are wholly inapposite, involving the failure to allege the requisite nexus between the transaction and the defendant’s activities (see Mahtani v C. Ramon, 168 AD2d 371, 371 [1st Dept 1990] [“(v)ague references by plaintiff to discussions had in New York which could have taken place either before or long after the transaction complained of fail to demonstrate purposeful activity by the defendants in this State that was undertaken in connection with the transactions at issue”]), or an isolated shipment of goods to an out-of-state defendant who then failed to pay, the “classic instance in which personal jurisdiction is found not to exist” (Cotia [USA] Ltd. v Lynn Steel Corp., 134 AD3d 483, 484 [1st Dept 2015] [internal quotation marks and citations omitted]). In Fischbarg v Doucet (9 NY3d 375 [2007]), another case cited by the majority, the Court of Appeals held that the retention of a New York attorney by a California plaintiff for purposes of litigating a case in Oregon did in fact constitute the transaction of business within the meaning of the long-arm statute (id.).