III.THE COURT LACKS PERSONAL JURISDICTION OVER DEFENDANT To establish personal jurisdiction over a nonresident defendant, a plaintiff must show that the forum state’s long-arm statute confers jurisdiction over the defendant and that the exercise of jurisdiction comports with constitutional principles of due process. Rio Props., Inc. v. Rio Int’l Interlink, 284 F.3d 1007, 1019 (9th Cir. 2002), citing Omeluk v. Langsten Slip & Batbyggeri A/S, 52 F.3d 267, 269 (9th Cir. 1995). Arizona’s long-arm statute allows the exercise of personal jurisdiction to the same extent as the U.S. Constitution. See Ariz. R. Civ. Proc. 4.2(a); Cybersell, Inc. v. Cybersell, Inc., 130 F.3d 414, 416 (9th Cir. 1997); A. Uberti & C. v. Leonardo, 892 P.2d 1354, 1358 (Ariz. 1995). Thus, a court in Arizona may exercise personal jurisdiction over a nonresident defendant as long as doing so accords with constitutional principles of due process. Id.“The Due Process Clause of the Fourteenth Amendment operates to limit the power of a State to assert in personam jurisdiction over a nonresident defendant.” Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414-15 (1984) (citation omitted). If a court determines that a defendant’s contacts with the forum state are sufficient to satisfy the Due Process Clause, then the court may exercise either “general” or “specific” jurisdiction over an out-of-state defendant. Boschetto v. Hansing, 539 F.3d 1011, 1016 (9th Cir. 200
. General jurisdiction refers to the authority of a court to exercise jurisdiction even where the cause of action is unrelated to the defendant’s contacts with the forum. Helicopteros, 466 U.S. at 414 n.9. Specific jurisdiction exists when a suit arises out of, or is related to, the defendant’s contacts with the forum. Id. at 414 n.8.
A.The Court Does Not Have General Jurisdiction over Defendant A court may assert general jurisdiction over a defendant if the defendant’s activities in the state are substantial or continuous and systematic, even if the cause of action is unrelated to those activities. Doe v. American Nat’l Red Cross, 112 F.3d 1048, 1050-51 (9th Cir. 1997), quotingHaisten v. Grass Valley Med. Reimbursement Fund, Ltd., 784 F.2d 1392, 1396 (9th Cir. 1986). Case 2:16-cv-00604-JJT Document 12 Filed 05/04/16 Page 9 of 28
-5- Here, there are no facts alleged supporting general jurisdiction over Mr. Stanton. Mr. Stanton is not engaged in any activities in Arizona that could be considered substantial or continuous and systematic. Mr. Stanton is a resident of Mississippi with his principal and only place of business in Brandon, Mississippi. (Id., ¶ 19.) Mr. Stanton does not conduct any business in Arizona. (Id., ¶ 20.) Mr. Stanton does not own real estate, personal property or other assets in Arizona. (Id., ¶ 21.) Mr. Stanton maintains no offices, employees, equipment, records, accounts, salespersons, or agents in Arizona. (Id., ¶ 22.) In fact, Mr. Stanton has never been to Arizona. (Id., ¶ 24.) Accordingly, Mr. Stanton does not have such continuous and systematic contacts with Arizona to be subject to general personal jurisdiction in this state. B.The Court Does Not Have Specific Jurisdiction over Defendant The Ninth Circuit applies a three-part test to determine whether the defendant’s contacts with the forum state are sufficient to subject him to the state’s specific jurisdiction. Under this three-part test, specific jurisdiction exists only if: (1) the defendant purposefully availed himself of the privileges of conducting activities in the forum, thereby invoking the benefits and protections of its laws, or purposely directs conduct at the forum that has effects in the forum; (2) the claim arises out of the defendant’s forum-related activities; and (3) the exercise of jurisdiction comports with fair play and substantial justice, i.e., it is reasonable. See. e.g., Bancroft & Masters, Inc. v. Augusta Nat’l Inc., 223 F.3d 1082, 1086 (9th Cir. 2000) (citingCybersell. Inc. v. Cybersell, Inc. 130 F.3d 414, 417 (9th Cir. 1997)). “The plaintiff bears the burden of satisfying the first two prongs of the test.” Id. If a plaintiff satisfies the first two burdens, “the burden then shifts to the defendant to present a compelling case that the exercise of jurisdiction would not be reasonable.” Id.Plaintiff has not satisfied the first two prongs of the test. In libel cases, the Supreme Court has held that a court may have specific jurisdiction over a defendant where the intended effects of the defendant’s non-forum conduct were purposely directed at and caused harm in the forum state. Calder v. Jones, 465 U.S. 783, 788-90, 104 S. Ct. 1482, 79 L. Ed. 2d 804 (1984). Under the Calder test, personal jurisdiction is based upon: “(1) intentional actions (2) expressly aimed at the forum state (3) causing harm, the brunt of which is suffered--and which Case 2:16-cv-00604-JJT Document 12 Filed 05/04/16 Page 10 of 28
-6- the defendant knows is likely to be suffered--in the forum state.” Core-Vent Corp. v. Nobel Indus. AB, 11 F.3d 1482, 1486 (9th Cir. 1993). To be clear, the focus is on the contacts the defendant has with the forum state itself, not with persons residing in the forum state. Plaintiff mistakenly focuses his personal jurisdiction allegations on the fact that Plaintiff resides in Arizona and, thus, Defendant should have known that any damage from alleged libelous statements would be felt by Plaintiff in Arizona. (Doc. 1, Compl, ¶ 2d.) However, the “effects test” is not this broad. The Ninth Circuit Court of Appeals has observed that Calder“cannot stand for the broad proposition that a foreign act with foreseeable effects in the forum state always gives rise to specific [personal] jurisdiction.” Bancroft, 223 F.3d at 1087. Purposeful direction requires “something more” than mere foreseeability in order to justify the assertion of personal jurisdiction over the out-of-state defendant. Id.Tort-based personal jurisdiction was most recently addressed by the U.S. Supreme Court in Walden v. Fiore, 571 U.S. ___, 134 S. Ct. 1115, 2014 WL 700098 (2014). In Walden, a Georgia police officer searched plaintiffs in Georgia and seized a large amount of cash. Plaintiffs claimed that after they returned to their Nevada residence, Walden helped draft a false probable cause affidavit in support of forfeiture. No forfeiture complaint was ever filed and the funds were returned. Plaintiffs filed a tort suit against Walden in a Nevada District Court. The district court dismissed, finding that the Georgia search and seizure did not establish a basis for personal jurisdiction in Nevada, even though that is where the Plaintiffs lived. The Ninth Circuit reversed, reasoning that Walden submitted the affidavit with the knowledge that it would affect persons with significant Nevada connections. The Supreme Court reversed the Ninth Circuit. In a unanimous decision the Court found there was no jurisdiction in Nevada, holding that “the proper question is not where the plaintiff experienced a particular injury or effect but whether the defendant’s conduct connects him to the forum in a meaningful way.” Walden, 2014 WL 700098, at *7 (emphasis added). The Court relied on Calder and its precedent emphasizing the defendant’s connection to the forum, not the plaintiff’s, when considering whether specific jurisdiction may be asserted. For a state to exercise jurisdiction consistent with due process, a relationship must arise out of contacts Case 2:16-cv-00604-JJT Document 12 Filed 05/04/16 Page 11 of 28
-7- that the defendant himself created with the forum itself, not with persons residing there. The plaintiff cannot be the only link between the defendant and the forum. Rather, it is the defendant’s conduct that must form the necessary connection with the forum. See Burger King v. Rudzewicz, 471 U.S. 462, 478, 105 S. Ct. 2174, 85 L. Ed. 2d 528 (1985) (“If the question is whether an individual’s contract with an out-of-state party alone can automatically establish sufficient minimum contacts in the other party’s home forum, we believe the answer clearly is that it cannot”); Kulko v. Superior Court of Cal., City and County of San Francisco, 436 U. S. 84, 93, 98 S.Ct. 1690, 56 L.Ed.2d 132 (197
(declining to “find personal jurisdiction in a State . . . merely because [the plaintiff in a child support action] was residing there”). Due process requires that a defendant be haled into court in a forum State based on his own affiliation with the State, not based on the “random, fortuitous, or attenuated” contacts he makes by interacting with other persons affiliated with the State. Burger King, 471 U. S. at 475 (internal quotation marks omitted); Walden, 2014 WL 700098, at *10. Like Walden, Mr. Stanton lacks the “minimal contacts” with Arizona supporting personal jurisdiction. None of the alleged wrongful conduct occurred in Arizona, and Mr. Stanton formed no jurisdictionally relevant contacts with Arizona. The Complaint alleges that “The Defendant sells merchandise which he profits from in the State of Arizona through online sale.” (Doc. 1, Compl. ¶ 2a.) It also is alleged that Defendant advertises his website “through his YouTube and other media outlets which is visible to viewers inside the State of Arizona and this advertisement and financial contact directly leads viewers in Arizona to the libelous statements involved in this case.” (Id. ¶ 2f). However, Mr. Stanton profits through online support donations (not “sales”) and nationwide advertising on the Internet in general. To establish specific jurisdiction, a defendant operating an interactive website must direct “something more” than just the website to the forum state. See Bancroft, 223 F.3d at 1087; see also George Kessel Int’l, Inc. v. Classic Wholesales, Inc., No. CV-07-323-PHX-SMM, 2007 WL 3208297, at *4 (D. Ariz. Oct. 30, 2007) (“An internet advertisement alone is insufficient to subject a party to jurisdiction in another state; there must be ‘something more’ to demonstrate that the defendant directed activity toward the forum state.” (citation omitted)). Additionally, Case 2:16-cv-00604-JJT Document 12 Filed 05/04/16 Page 12 of 28
-8- this lawsuit is not even related to the alleged forum-related activities of making online sales and receiving donations or support from Arizona residents. Plaintiff also asserts that Defendant purposefully availed himself of the privilege of doing business in Arizona by selling subscriptions to his services for minimum $1 per month, of which there are almost 4,000 subscribers, “some of which are in The State of Arizona causing continual periodic financial contact with the State.” (Doc. 1, Compl. ¶ 2b.) However, Mr. Stanton does not sell anything in Arizona or to the State of Arizona. He produces videos and articles in Mississippi and his audience can choose to donate to him on Patreon, a crowdfunding site for artists and creators. (See Exhibit A, ¶ 14.) This audience is worldwide and has no specific or majority basis in Arizona. (Id., ¶ 17.) Mr. Stanton’s business is supported entirely be crowd funding, meaning that individuals voluntarily elect to support Defendant’s business through donations. (Id., ¶ 13.) A donation is not required in order to access Mr. Stanton’s reviews, videos and online content. (Id., ¶ 15.) Mr. Stanton does not solicit donations from any particular state or jurisdiction and is not aware if individuals from the State of Arizona have or have not donated to support Mr. Stanton’s business. (Id., ¶ 16.) However, even if there are donors from Arizona or content viewers from Arizona, that does not constitute “something more” showing Mr. Stanton purposefully directed activity toward Arizona. Plaintiff has not shown that Mr. Stanton specifically targeted Arizona residents with his services, nor is the alleged (non-existent) $1.00 subscription fee enough to overcome the “something more” hurdle on its own, even if such subscriptions were the subject of the claims. Plaintiff also alleges “The Defendant has directed damaging statements at The Plaintiff causing in excess of $2,000,000 damages to the Plaintiff, an Arizona resident... The Defendant knew or should have known that the statements would cause damage and that such damage would occur in Arizona.” (Doc. 1, Compl.¶ 2d)2 However, as explained in Calder and Walden, the fact that Plaintiff is located in Arizona and that the “brunt of the harm” is felt by Plaintiff in Arizona is not sufficient to confer personal jurisdiction over Defendant. There is no 2 Plaintiff also cites 42 U.S.C. § 1985, Conspiracy to interfere with civil rights, which is a statute inapplicable to this case. Case 2:16-cv-00604-JJT Document 12 Filed 05/04/16 Page 13 of 28
-9- evidence that the alleged libelous statements were directed to the State of Arizona, as opposed to being directed at Plaintiff, who happens to reside in Arizona. While in Calder the events underlying the alleged libelous story occurred in California and the story was researched through California sources, here the alleged libel concerned DHS products that were distributed worldwide through Steam, an entity located in the State of Washington. (Exhibit A, ¶ 8.) It has not been alleged that DHS products reached Defendant other than through the ordinary stream of commerce. Unlike in Calder, therefore, the alleged libel cannot be seen as a comment on an Arizona event. Rather, it is a comment on video games made available by DHS worldwide on the Internet through Steam, a video game distribution service, including to Defendant’s home state of Mississippi and elsewhere. Moreover, while any article written in the National Enquirer might be directed at a California audience (as in Calder), here, by contrast, Defendant’s website and YouTube channel are available worldwide. It has not been alleged that Arizona was a primary audience for the commentary or that Defendant knew that Plaintiff lived in Arizona. Furthermore, unlike in Calder, it is unclear whether the brunt of the alleged harm has been suffered in Arizona. Calder involved alleged libel against an individual. This case involves an allegation of libel against a limited liability company in a suit that has wrongly been brought by an individual manager of that company. A limited liability company does not suffer harm in a particular geographic location in the same sense that an individual does. The harm from an allegedly libelous statement is not necessarily suffered in the place of incorporation or organization. Core-Vent, 11 F.3d at 1486, citing Casualty Assurance Risk Insurance Brokerage Co. v. Dillon, 976 F.2d 596, 599-600 (9th Cir. 1992). In summary, mere injury to an Arizona resident is not a sufficient connection to the forum for Mr. Stanton to be subject to personal jurisdiction in Arizona. The alleged injury occurred in Arizona simply because that is where plaintiff chose to reside. Arizona was not the focal point of the alleged injury or a location of harm foreseeable to Mr. Stanton and Mr. Stanton did not expressly aim the alleged defamatory statements at Arizona. See, e.g., Herman v. Cataphora, Inc., 730 F.3d 460, 465 (5th Cir. 2013) (no jurisdiction in Louisiana over a Case 2:16-cv-00604-JJT Document 12 Filed 05/04/16 Page 14 of 28
-10- California defendant where, even though the defendant knew plaintiffs engaged in some activity in Louisiana, he never mentioned Louisiana explicitly or implicitly in the article, nor did he refer to specific actions taken in Louisiana); see alsoClemens v. McNamee, 615 F.3d 374, 378-79 (5th Cir. 2010) (declining personal jurisdiction because, even though the defendant knew harm would result in Texas, Texas was not the focal point of the alleged defamatory statement). Because Arizona was not the focal point of the alleged libelous statements, Mr. Stanton is not subject to personal jurisdiction in Arizona.
