Senne v. MLB - Motion to Dismiss

NOTICE OF MOTION AND MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF – CASE NO. 3:14-cv-00608-JCS

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

PROSKAUER ROSE LLP Howard L. Ganz Elise M. Bloom (admitted pro hac vice) Neil H. Abramson (admitted pro hac vice) Adam M. Lupion (admitted pro hac vice) 11 Times Square New York, NY 10036 Telephone: (212) 969-3000 Facsimile: (212) 969-2900 PROSKAUER ROSE LLP Laura Reathaford (SBN 254751) [email protected] 2049 Century Park East, 32nd Floor Los Angeles, CA 90067-3206 Telephone: (310) 557-2900 Facsimile: (310) 557-2193 Attorneys for Defendants*

UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

AARON SENNE, et al.,

Plaintiffs, vs. OFFICE OF THE COMMISSIONER OF BASEBALL, an unincorporated association doing business as MAJOR LEAGUE BASEBALL, et al. Defendants.

Case No. CV 14-00608 JCS Hon. Joseph C. Spero CLASS ACTION

NOTICE OF MOTION AND MOTION TO DISMISS THE SECOND AMENDED COMPLAINT AS AGAINST CERTAIN DEFENDANTS FOR LACK OF PERSONAL JURISDICTION

Date: September 5, 2014 Time: 9:30 am Place: Courtroom G, 15th Floor

Complaint filed: February 7, 2014

First Am. Complaint filed: March 5, 2014

Second Am. Complaint filed: April 21, 2014

* With the exception of Baltimore Orioles, Inc., and Baltimore Orioles, L.P, Proskauer Rose is counsel to all Defendants in this matter.

Case3:14-cv-00608-JCS Document115 Filed05/23/14 Page1 of 22


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

NOTICE OF MOTION AND MOTION TO DISMISS

PLEASE TAKE NOTICE that on September 5, 2014 at 9:30 a.m. or as soon thereafter as

counsel may be heard Defendants: Atlanta National League Baseball Club, Inc., Boston Red Sox

Baseball Club L.P., Chicago White Sox, Ltd., Cleveland Indians Baseball Co., L.P., Cleveland

Indians Baseball Co., Inc., Detroit Tigers, Inc., New York Yankees, P’ship, the Phillies L.P.,

Pittsburgh Baseball, Inc., Pittsburgh Baseball P’Ship, Tampa Bay Rays Baseball, Ltd., and

Washington Nationals Baseball Club, LLC (collectively, the “Moving Defendants”)1 will and hereby

do move this Court for an order dismissing the Second Amended Complaint as against them for lack

of personal jurisdiction.

This motion is made pursuant to Fed. R. Civ. P. 12(b)(2) on the ground that none of the

Moving Defendants are subject to personal jurisdiction in the State of California. The Moving

Defendants’ contacts with California are not “continuous and systematic” such that they

“approximate physical presence” in this State. Moreover, Plaintiffs’ claims do not arise out of or

relate to the Moving Defendants’ forum-related activities. Finally, the exercise of jurisdiction would

run afoul of the principles of fair play and substantial justice – i.e., it would be unreasonable.

This motion is based on this Notice, the Memorandum of Points and Authorities, the

Declarations of Greg Heller, Elaine W. Steward, Joseph Zndisaric, John Corvino, John Westhoff,

Lonn Trost, Richard Strouse, Bryan Stroh, John Higgins and Damon Jones, the pleadings and

records on file with this Court, all matters of which the Court must or may take judicial notice, and

such evidence and argument as may be presented at or before the hearing on this matter.

1 Pittsburgh Associates, LP, is incorrectly identified in the Second Amended Complaint as Pittsburgh Baseball, Inc. and Pittsburgh Baseball Partnership; The Phillies are incorrectly identified as The Phillies L.P.


2


Dated: May 23, 2014 PROSKAUER ROSE LLP

ELISE M. BLOOM HOWARD L. GANZ NEIL H. ABRAMSON ADAM M. LUPION LAURA REATHAFORD

By:

/s/ Elise M. Bloom

Elise M. Bloom Attorneys for Defendants


i NOTICE OF MOTION AND MOTION TO DISMISS FOR LACK OF PERSONAL JURISDICTION AND MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT THEREOF – CASE NO. 3:14-cv-00608-JCS

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

TABLE OF CONTENTS Page

TABLE OF AUTHORITIES ..........................................................................................................ii MEMORANDUM OF POINTS AND AUTHORITIES ................................................................. 1 I. INTRODUCTION ...............................................................................................................1 II. STATEMENT OF RELEVANT FACTS ............................................................................2 A. The Moving Defendants ..........................................................................................2 B. Plaintiffs’ Allegations ..............................................................................................3 III. LEGAL ARGUMENT .........................................................................................................4 DEFENDANTS ARE NOT SUBJECT TO PERSONAL JURSIDICTION IN THE STATE OF CALIFORNIA .................................................................................................................................4 1. The Court Lacks General Jurisdiction Because The Moving Defendants’ Affiliations With California Are Not “Continuous and Systematic” Such That They “Approximate Physical Presence”.................................................5 2. The Court Lacks Specific Jurisdiction Because The Moving Defendants Do Not Have Minor League Affiliates That Play In California And Therefore Plaintiffs’ Claims Do Not Arise Out Of The Moving Defendants’ Contracts With California .................................................................10 a. The Moving Defendants Did Not Purposefully Avail Themselves Of Conducting Activities In California With Respect To Minor League Players ................................................................................11 b. Plaintiffs’ Claims Do Not Arise Out Of Or Relate To The Defendants’ Forum-Related Activities ......................................................12 c. The Exercise of Jurisdiction Over Any Of The Moving Defendants Would Not Be Reasonable .........................................................................13 IV. CONCLUSION ..................................................................................................................15


ii


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

TABLE OF AUTHORITIES Page(s)

CASES

A.C.K. Sports, Inc. v. Doug Wilson Enterprises, Inc., 661 F. Supp. 386 (S.D.N.Y. 1987).........................................................................................8, 9

Amba Mktg. Sys., Inc. v. Jobar Int’l Inc., 551 F.2d 784 (9th Cir. 1977) .....................................................................................................5

Autogenomics, Inc. v. Oxford Gene Tech., Ltd., 566 F.3d 1012 (Fed. Cir. 2009)..................................................................................................9

Bancroft & Masters, Inc. v. Augusta Nat., Inc., 45 F. Supp. 2d 777 (N.D. Cal. 1998), reversed on other grounds, 223 F.3d 1082 (9th Cir. 2000) .......................................................9

Bancroft & Masters, Inc. v. Augusta Nat’l Inc., 223 F.3d 1082 (9th Cir. 2000) ...................................................................................................6

Boschetto v. Hansing, 539 F.3d 1011 (9th Cir. 2008) .............................................................................................4, 10

Brand v. Menlove Dodge, 796 F.2d 1070 (9th Cir. 1986) ...................................................................................................6

Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985) .................................................................................................................11

CE Distrib., LLC v. New Sensor Corp., 380 F.3d 1107 (9th Cir. 2004) .............................................................................................5, 13

Core-Vent Corp. v. Nobel Indus. AB, 11 F.3d 1482 (9th Cir. 1993) .........................................................................................9, 14, 15

Daimler AG v. Bauman, 134 S. Ct. 746 (2014) .....................................................................................................2, 6, 7, 8

Data Disc, Inc. v. Sys. Tech. Assocs., Inc., 557 F.2d 1280 (9th Cir. 1977) ...................................................................................................4

Daynard v. Ness, Motley, Loadholt, Richardson & Poole, P.A., 284 F. Supp. 2d 204 (D. Mass. 2003) ........................................................................................7

Doe v. Unocal Corp., 248 F.3d 915 (9th Cir. 2001) ...................................................................................................12

Dole Food Co. v. Watts, 303 F.3d 1104 (9th Cir. 2002) .................................................................................................14


iii


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Donatelli v. Nat’l Hockey League, 893 F.2d 459 (1st Cir. 1990) ......................................................................................................9

Enriquez v. Interstate Group, LLC, No. 11-CV-05155 YGR, 2012 WL 3800801 (N.D. Cal. Aug. 31, 2012) ................................11

Evans v. Boston Red Sox, No. 13-00262 SOM BMK, 2013 U.S. Dist. LEXIS 166307 (D. Haw. Nov. 22, 2013) ............8

Fed. Deposit Ins. Corp. v. British-Am. Ins. Co., 828 F.2d 1439 (9th Cir. 1987) .............................................................................................5, 14

Glencore Grain Rotterdam B.V. v. Shivnath Rai Harnarain, Co., 284 F.3d 1114 (9th Cir. 2002) .................................................................................................10

Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S. Ct. 2846 (2011) ...................................................................................................2, 5, 6, 8

Holliday v. Lifestyle Lift, Inc., No. C 09–4995 RS, 2010 WL 3910143 (N.D. Cal. Oct. 5, 2010) ...........................................11

Int’l Shoe Co. v. Washington, 326 U.S. 310 (1945) ...................................................................................................................5

Kipperman v. McCone, 422 F. Supp. 860 (N.D. Cal. 1976) ..........................................................................................14

Kouba v. Renzenberger, Inc., No. Civ. 10-159 TUC FRZ (GEE), 2010 U.S. Dist. LEXIS 135743 (D. Ariz. May 14, 2010) ..........................................................................................................................................5

Leroy-Garcia v. Brave Arts Licensing, No. C 13-01181 LB, 2013 U.S. Dist. LEXIS 109872 (N.D. Cal. Aug. 5, 2013) ....................10

Mavrix Photo, Inc. v. Brand Techs., Inc., 647 F.3d 1218 (9th Cir. 2011) ...................................................................................................5

Peterson v. Kennedy, 771 F.2d 1244 (9th Cir. 1985) .................................................................................................10

Reiffin v. Microsoft Corp., No. C 11-03505 CRB, 2012 U.S. Dist. LEXIS 53220 (N.D. Cal. Apr. 16, 2012) ....................9

Rio Props., Inc. v. Rio Int’l Interlink, 284 F.3d 1007 (9th Cir. 2002) ...................................................................................................4

Salesbrain, Inc. v. AngelVision Techs., No. C 12-05026 LB, 2013 U.S. Dist. LEXIS 40607 (N.D. Cal. Mar. 21, 2013) .....................10


iv


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797 (9th Cir. 2004) .............................................................................................11, 12

Sinatra v. Nat’l Enquirer, Inc., 854 F.2d 1191 (9th Cir. 1988) .................................................................................................11

Thos P. Gonzalez Corp. v. Consejo Nacional de Produccion de Costa Rica, 614 F.2d 1247 (9th Cir. 1980) ...........................................................................................12, 13

Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163 (9th Cir. 2006) ...................................................................................................6

Vice v. Woodline USA, Inc., No. C 10-04103 CW, 2011 U.S. Dist. LEXIS 8014 (N.D. Cal. Jan. 21, 2011) .........................9

Walden v. Fiore, 134 S. Ct. 1115 (2014) ...................................................................................................5, 10, 12

Yahoo! Inc. v. La Ligue Contre Le Racisme Et L’Antisemitisme, 433 F.3d 1199 (9th Cir. 2006) .............................................................................................6, 11

STATUTES AND OTHER AUTHORITIES

28 U.S.C. § 1404(a) ...................................................................................................................1, 15

Fed. R. Civ. P. 12(b)(2)....................................................................................................................4

Cal. Code Civ. Proc. § 410.10 .........................................................................................................5



1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

MEMORANDUM OF POINTS AND AUTHORITIES

I. INTRODUCTION

This lawsuit is brought as various putative subclass actions and as a putative nationwide Fair

Labor Standards Act (“FLSA”) collective action on behalf of current and former Minor League

professional baseball players. In addition to the Office of the Commissioner of Baseball (doing

business as Major League Baseball, and hereinafter “MLB”), Plaintiffs named all thirty MLB Clubs

as Defendants in this matter. The claims alleged in the Second Amended Complaint arise out of and

relate solely to the MLB Clubs’ compensation of Minor League baseball players. Because ten of the

MLB Clubs named as Defendants in the Complaint – Atlanta National League Baseball Club, Inc.,

Boston Red Sox Baseball Club L.P., Chicago White Sox, Ltd., Cleveland Indians Baseball Co., Inc.,

Cleveland Indians Baseball Co., L.P., Detroit Tigers, Inc., New York Yankees, P’ship, The Phillies

(incorrectly named as “The Phillies L.P.”); Pittsburgh Associates, L.P. (incorrectly named as

“Pittsburgh Baseball, Inc.” and “Pittsburgh Baseball P’Ship”), Tampa Bay Rays Baseball, Ltd., and

Washington Nationals Baseball Club, LLC (hereinafter, the “Moving Defendants”) – are not subject

to personal jurisdiction in California, the Moving Defendants respectfully request that the Court

dismiss this lawsuit against them for lack of personal jurisdiction.2

California’s long-arm statute permits California courts to exercise jurisdiction over a non-

resident defendant coextensive with the limits imposed by the Due Process Clause of United States

Constitution, i.e., the non-resident must have “certain minimum contacts” with the forum state in

order for jurisdiction to exist. The requisite contacts exist only if: (i) the non-resident engages in

continuous and systematic general business activities that “approximate physical presence” in

California (referred to as “general jurisdiction”); or (ii) the claims alleged arise out of the

defendant’s contacts with the forum state (referred to as “specific jurisdiction”). The Moving

Defendants are not subject to personal jurisdiction in California on either basis.

The Moving Defendants’ contacts with California are limited to those occasions when their

Major League Baseball Clubs play baseball games against other Major League Clubs in this State. 2 In the alternative, the Moving Defendants join in the Motion to Transfer Venue to the Middle District of Florida pursuant to 28 U.S.C. § 1404(a), filed with the Court on this same date.


2


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

But the claims alleged in the Second Amended Complaint are completely unrelated to the exhibition

of Major League Baseball games or to the compensation paid to Major League Players. To the

contrary, the allegations are aimed solely to the alleged “work” performed by, and the compensation

paid to, Minor League Baseball players. The Moving Defendants are not affiliated with Minor

League teams that are based in California, and their Minor League players do not play games in

California or otherwise engage in activities for these Defendants in California. Thus, because the

claims alleged in the Second Amended Complaint plainly do not arise out of the Moving

Defendants’ contacts with this state, the action can be maintained here only if the Moving

Defendants are subject to general personal jurisdiction in California. They are not.

The United States Supreme Court has, in recent years, curtailed the courts’ exercise of all-

purpose (or “general”) jurisdiction over non-resident defendants. Daimler AG v. Bauman, 134 S. Ct.

746, 761 (2014); Goodyear Dunlop Tires Operations, S.A. v. Brown, 131 S. Ct. 2846 (2011). In

short, when a plaintiff’s claims do not arise out of or relate to a non-resident defendant’s contacts

with the forum state, personal jurisdiction exists only when the defendant has continuous and

systematic affiliations with the forum state such that it can be deemed “at home” there and should

reasonably expect to be called into court in that forum. Here, the limited California contacts of the

Moving Defendants do not come remotely close to satisfying that exacting standard. The Moving

Defendants cannot be said to have approximated a physical presence in California such that they are

amenable to suit here simply because they play a handful of Major League Baseball games in

California during the baseball season.

Accordingly, Plaintiffs’ Second Amended Complaint should be dismissed as to these Moving

Defendants for lack of personal jurisdiction.

II. STATEMENT OF RELEVANT FACTS

A. The Moving Defendants

MLB is an unincorporated association whose members are the 30 MLB Clubs. (Compl., ¶

51) The Moving Defendants are the entities named in the Complaint associated with 10 of the 30

MLB Clubs. (Compl., ¶¶ 65, 67, 68, 78, 79, 82, 85, 86, 87, 88) Each MLB Club is affiliated with

several Minor League teams, organized into “classes” roughly reflecting the skill level of the


3


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

players. (Compl., ¶ 152) Although some Minor League teams are directly owned by an MLB Club,

most Minor League teams are independently owned, and operated pursuant to Player Development

Contracts (“PDCs”), agreements by which a Minor League club agrees to “affiliate” itself with an

MLB Club for a certain time period. (Compl., ¶ 154)

The 10 Clubs filing this motion do not have any Minor League affiliates based in California

or that play games in California, and do not have any operations whatsoever in California. (Heller

Decl. at ¶ 8; Steward Decl. at ¶ 8; Znidarsic Decl. at ¶ 8; Corvino Decl. at ¶ 8; Westhoff Decl. at ¶ 8;

Trost Decl. at ¶ 8; Strouse Decl. at ¶ 8; Stroh Decl. at ¶ 8; Higgins Decl. at ¶ 8; Jones Decl. at ¶ 8)

The only contact the Moving Defendants have with California is that their Major League Baseball

Clubs occasionally play baseball games against other California-based Major League Clubs in

California. (Heller Decl. at ¶ 7; Steward Decl. at ¶ 7; Znidarsic Decl. at ¶ 7; Corvino Decl. at ¶ 7;

Westhoff Decl. at ¶ 7; Trost Decl. at ¶ 7; Strouse Decl. at ¶ 7; Stroh Decl. at ¶ 7; Higgins Decl. at ¶

7; Jones Decl. at ¶ 7)

The Moving Defendants travel to California to play Major League Baseball games between

one and three times per year, and those trips range in duration from two to ten days per trip. Since

2009, none of the Moving Defendants played more than 16 Major League games in California in a

single year, and, in many years, play fewer than 10 Major League games each year in this state. Id.

The Moving Defendants do not determine when they travel to California or how long they will be

required to stay; those decisions are made by MLB – not by the member Clubs. Id. In addition, the

Moving Defendants are not licensed to do business in California; are incorporated in or organized

under the laws of states other than California; maintain their principal places of business outside of

California; and do not own or rent property, maintain bank accounts, or have a designated agent in

the State of California. (Heller Decl. at ¶¶ 2-6; Steward Decl. at ¶¶ 2-6; Znidarsic Decl. at ¶¶ 2-6;

Corvino Decl. at ¶¶ 2-6; Westhoff Decl. at ¶¶ 2-6; Trost Decl. at ¶¶ 2-6; Strouse Decl. at ¶¶ 2-6;

Stroh Decl. at ¶¶ 2-6; Higgins Decl. at ¶¶ 2-6; Jones Decl. at ¶¶ 2-6)

B. Plaintiffs’ Allegations

On February 7, 2014, plaintiffs Aaron Senne, Michael Liberto, and Oliver Odle filed a


4


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

complaint against the Defendants3 alleging: (i) violations of the FLSA related to minimum wage,

overtime, and recordkeeping; and (ii) violations of state wage and hour laws and/or claims for

quantum meruit under Florida, California, Arizona, North Carolina and New York law.

On March 5, 2014 Plaintiffs amended their complaint to add 18 new plaintiffs, 14 new MLB

Clubs as Defendants, and two new claims (one each under Florida and California law). Plaintiffs

amended their complaint for a second time on or about April 21, 2014, naming 12 additional

Plaintiffs and the remaining 13 MLB Clubs as Defendants. Plaintiffs seek minimum wage and

overtime pay for time spent playing Minor League baseball during spring training, the championship

season (commonly referred to as the “regular” season), and in instructional leagues, as well as for

alleged off-season training activities. (Compl., ¶¶ 166-72, 467-585)

III. LEGAL ARGUMENT

DEFENDANTS ARE NOT SUBJECT TO PERSONAL JURISDICTION IN THE STATE OF CALIFORNIA

Fed. R. Civ. P. 12(b)(2) allows a defendant to challenge a complaint for lack of personal

jurisdiction. A court’s determination whether to exercise personal jurisdiction is a question of law.

Rio Props., Inc. v. Rio Int’l Interlink, 284 F.3d 1007, 1019 (9th Cir. 2002). Although the defendant

is the moving party in a motion to dismiss, the plaintiff bears the burden of establishing jurisdiction

in opposition to the motion. Id.; Boschetto v. Hansing, 539 F.3d 1011, 1015 (9th Cir. 2008).

Here, Plaintiff’s basis for establishing jurisdiction in the Northern District of California is

one threadbare allegation in the Second Amended Complaint that, “[a]ll Defendants are subject to

personal jurisdiction in California since all Defendants transact a significant amount of business in

California.” (Compl., ¶ 118) No additional facts are alleged, and that single conclusory allegation

does not satisfy Plaintiffs’ burden.

While uncontroverted allegations in the complaint must be taken as true, the allegations may

not be assumed true when they are contradicted by affidavit evidence. Data Disc, Inc. v. Sys. Tech.

3 The initially named defendants were the Office of the Commissioner of Baseball doing business as Major League Baseball; Allan Huber “Bud” Selig; Kansas City Royals Baseball Corp.; Miami Marlins, L.P.; and San Francisco Baseball Associates LLC.


5


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Assocs., Inc., 557 F.2d 1280, 1284 (9th Cir. 1977). Moreover, even in opposition to a motion to

dismiss, Plaintiffs cannot “simply rest on the bare allegations of their complaint,” but rather must

“come forward with facts, by affidavit or otherwise, supporting personal jurisdiction.” Amba Mktg.

Sys., Inc. v. Jobar Int’l Inc., 551 F.2d 784, 787 (9th Cir. 1977) (granting motion to dismiss because

plaintiff failed to meet defendant’s jurisdictional challenge with sufficient facts to sustain its burden

of establishing personal jurisdiction).

Because the express provisions of the FLSA are silent with respect to personal jurisdiction,

this Court must apply the law of the forum state to determine whether personal jurisdiction exists.

See Kouba v. Renzenberger, Inc., No. Civ. 10-159 TUC FRZ (GEE), 2010 U.S. Dist. LEXIS

135743, at *3-4 (D. Ariz. May 14, 2010). See also CE Distrib., LLC v. New Sensor Corp., 380 F.3d

1107, 1110 (9th Cir. 2004); Fed. Deposit Ins. Corp. v. British-Am. Ins. Co., 828 F.2d 1439, 1441

(9th Cir. 1987). California’s long-arm statute permits California courts to exercise jurisdiction to the

extent consistent with due process. Cal. Code Civ. Proc. § 410.10.

A court’s exercise of personal jurisdiction over a non-resident defendant is consistent with

due process only if that defendant has “certain minimum contacts” with the forum state “such that

the maintenance of the suit does not offend traditional notions of fair play and substantial

justice.” Walden v. Fiore, 134 S. Ct. 1115, 1121 (2014); Mavrix Photo, Inc. v. Brand Techs., Inc.,

647 F.3d 1218, 1223 (9th Cir. 2011); Int’l Shoe Co. v. Washington, 326 U.S. 310, 316

(1945) (internal quotations omitted).

There are two forms of personal jurisdiction that a forum state may exercise over a non-

resident defendant - general jurisdiction and specific personal jurisdiction. For the reasons stated

below, the Moving Defendants are not subject to jurisdiction under either theory.

1. The Court Lacks General Jurisdiction Because The Moving Defendants’ Affiliations With California Are Not “Continuous And Systematic” Such That They “Approximate Physical Presence.”

A court may assert general jurisdiction over a non-resident defendant “to hear any and all

claims against them when their affiliations with the State are so ‘continuous and systematic’ as to

render them essentially at home in the forum State.” Goodyear Dunlop Tires Operations, S.A. v.


6


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Brown, 131 S. Ct. 2846, 2851 (2011) (citations omitted). The Supreme Court in Goodyear made

clear that only a very specific type of affiliation with a forum will render a defendant amenable to

general jurisdiction there. “For an individual, the paradigm forum for the exercise of general

jurisdiction is the individual’s domicile; for a corporation, it is an equivalent place, one in which the

corporation is fairly regarded as at home.” Id. at 2853-54. Indeed, the Court noted that it would be

the “exceptional case” where “a corporation’s operations in a forum other than its formal place of

incorporation or principal place of business may be so substantial and of such a nature as to render

the corporation at home in that State.” Daimler AG v. Bauman, 134 S. Ct. 746, 761, n.19 (2014).

The Ninth Circuit likewise has made clear that the standard for establishing general

jurisdiction is “fairly high.” Brand v. Menlove Dodge, 796 F.2d 1070, 1073 (9th Cir. 1986). Indeed,

“[u]nless a defendant’s contacts with a forum are so substantial, continuous, and systematic that the

defendant can be deemed to be ‘present’ in that forum for all purposes, a forum may exercise only

‘specific’ jurisdiction—that is, jurisdiction based on the relationship between the defendant’s forum

contacts and the plaintiff’s claim.” Yahoo! Inc. v. La Ligue Contre Le Racisme Et L’Antisemitisme,

433 F.3d 1199, 1205 (9th Cir. 2006).4

“[S]ubstantial, continuous and systematic” contacts are those that “approximate physical

presence.” Bancroft & Masters, Inc. v. Augusta Nat’l Inc., 223 F.3d 1082, 1086 (9th Cir. 2000).

“[D]etermining whether a corporate defendant’s contacts in a particular case are substantial and

continuous turns on the ‘economic reality of the defendants’ activities rather than a mechanical

checklist.” Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163, 1173 (9th Cir. 2006). Simply

“engaging in commerce with residents of the forum state is not in and of itself the kind of activity

that approximates physical presence within the state’s borders.” Bancroft & Masters, Inc., 223 F.3d

at 1086.

Here, the Moving Defendants’ “presence” in this State is limited to those occasions when a

Major League Club visits California to play Major League games against other Major League Clubs

based in California – visits that occur one to three times per year and last anywhere between two to 4 As discussed more fully below, Plaintiffs cannot make a threshold showing of specific jurisdiction.


7


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

ten days per trip. The Moving Defendants are not incorporated in California (or otherwise organized

under the laws of California). The Moving Defendants have their principal places of business in

states other than California and are not licensed to do business here. Similarly, the Moving

Defendants do not have any facilities in California, do not own or rent property here, and do not

maintain bank accounts in California.5 The Moving Defendants are by no means “at home” in

California, and therefore cannot be sued here for claims that neither arose in California nor are

related to their limited activities here.

The mere fact that the Moving Defendants play Major League games (but not Minor League

games) in California against other member Clubs is insufficient to establish general personal

jurisdiction. As an initial matter, the fact that MLB, an unincorporated association, and the non-

moving Defendant member Clubs, do not challenge the exercise of personal jurisdiction is of no

moment. The existence of personal jurisdiction over an unincorporated association is not a basis for

exercising personal jurisdiction over non-resident members. See Daynard v. Ness, Motley, Loadholt,

Richardson & Poole, P.A., 284 F. Supp. 2d 204 (D. Mass. 2003) (declining to exercise personal

jurisdiction over non-resident members of unincorporated association despite the existence of

jurisdiction over the unincorporated association itself).

Moreover, the contacts of MLB and other non-moving member Clubs cannot be imputed to

the Moving Defendants. In this regard, the Supreme Court’s recent decision in Daimler AG, 134 S.

Ct. 746, is instructive. In that case, the Court considered whether a foreign corporation may be

subjected to a court’s general jurisdiction based on the contacts of its in-state subsidiary. The Court

held it could not. Rejecting the Ninth Circuit’s application of a less rigorous test upholding

jurisdiction based on an expansive view of agency principles, the Court stated: The Ninth Circuit’s agency finding rested primarily on its observation that [the subsidiary’s] services were “important” to its [defendant-parent], as gauged by the [defendant-parent]’s hypothetical readiness to perform those services itself if the subsidiary did not exist. Formulated this way, the inquiry into importance stacks

5 See Heller Decl. at ¶ 4; Steward Decl. at ¶ 4; Znidarsic Decl. at ¶ 4; Corvino Decl. at ¶ 4; Westhoff Decl. at ¶ 4; Trost Decl. at ¶ 4; Strouse Decl. at ¶ 4; Stroh Decl. at ¶ 4; Higgins Decl. at ¶ 4; Jones Decl. at ¶ 4.


8


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

the deck, for it will always yield a pro-jurisdiction answer: “Anything a corporation does through an independent contractor, subsidiary, or distributor is presumably something that the corporation would do ‘by other means’ if the independent contractor, subsidiary, or distributor did not exist.” 676 F.3d, at 777 (O’Scannlain, J., dissenting from denial of rehearing en banc). The Ninth Circuit’s agency theory thus appears to subject foreign corporations to general jurisdiction whenever they have an in-state subsidiary or affiliate, an outcome that would sweep beyond even the “sprawling view of general jurisdiction” we rejected in Goodyear.

Id. at 759-60 (emphasis added).

Although there is no parent-subsidiary relationship alleged here, the Court’s reasoning

compels the same result: simply because the Moving Defendants are members of an unincorporated

association, some of whose members are California residents, does not mean that the foreign Clubs

are “at home” in California for all purposes.

Applying these principles, courts have declined to exercise general personal jurisdiction over

professional sports teams, leagues and players based on the non-resident defendant’s limited contacts

with the forum state.

For example, in Evans v. Boston Red Sox, No. 13-00262 SOM BMK, 2013 U.S. Dist. LEXIS

166307, at *10-12 (D. Haw. Nov. 22, 2013), the court declined to exercise general personal

jurisdiction over an MLB Club, the Boston Red Sox, in Hawaii. The court found that it lacked

personal jurisdiction over this Club because the Club did not have any offices, agents, or bank

accounts in Hawaii, and it did not own, rent or lease any real property in Hawaii. Id., at *10-11.6

Those same factors are also present here with respect to the Moving Defendants.

Similarly, in A.C.K. Sports, Inc. v. Doug Wilson Enterprises, Inc., 661 F. Supp. 386

(S.D.N.Y. 1987), the court held that appearing in New York to play professional hockey games did

not confer personal jurisdiction in that state over a non-resident professional hockey player. In that

case, the defendant, a professional hockey player for the Chicago Blackhawks, “appeared in New

York regularly as a member of the Blackhawks when his team plays a road game against the Buffalo

6 While the Court also noted that the Club did not play any regular season or exhibition games in Hawaii, the Court did not suggest doing so would have been sufficient to confer personal jurisdiction over the defendant Club in that case.


9


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Sabres, the New York Rangers or the New York Islanders.” Id. at 388. The court “decline[d] to

adopt the view that an athlete playing on a team is doing business, for personal jurisdiction purposes,

in every state where his team plays.” Id. at 390. Simply because the player came to New York to

play hockey and stayed in hotels and ate in New York restaurants did not mean that the player “d[id]

business” in New York within the meaning of New York’s long arm statute. Id. See also Donatelli

v. Nat’l Hockey League, 893 F.2d 459 (1st Cir. 1990) (declining to exercise personal jurisdiction

over National Hockey League based solely on the fact that NHL Club played games in forum state).

A Club’s travel to California to play baseball games is most analogous to organizations

whose employees periodically travel to California to attend business conferences or trade shows. In

these situations, courts routinely have ruled that such attendance at California-based events “does not

constitute the sufficiently continuous and systematic contact necessary to justify general

jurisdiction.” See Core-Vent Corp. v. Nobel Indus. AB, 11 F.3d 1482, 1490 (9th Cir. 1993) (no

“systematic and continuous contacts with California” based on the allegation that Defendant

“attended five medical conferences in California over the last four years”); Autogenomics, Inc. v.

Oxford Gene Tech., Ltd., 566 F.3d 1012, 1018 (Fed. Cir. 2009) (holding that “four conferences over

five years constitute only sporadic and insubstantial contacts”); Bancroft & Masters, Inc. v. Augusta

Nat., Inc., 45 F. Supp. 2d 777, 781 (N.D. Cal. 1998), reversed on other grounds, 223 F.3d 1082 (9th

Cir. 2000) (“Nor do ANI’s occasional business trips to California to attend conferences or

educational seminars reflect the type of substantial or continuous and systematic contact needed to

confer general jurisdiction”); Vice v. Woodline USA, Inc., No. C 10-04103 CW, 2011 U.S. Dist.

LEXIS 8014, at *6-7 (N.D. Cal. Jan. 21, 2011).

In Reiffin v. Microsoft Corp., No. C 11-03505 CRB, 2012 U.S. Dist. LEXIS 53220 (N.D.

Cal. Apr. 16, 2012), this court also found that defendant’s attendance at several California-based

conferences on behalf of defendant Microsoft over the years was insufficient to establish general

jurisdiction over a Washington resident because the “economic reality is that Ballmer’s contacts with

California are ‘more occasional than continuous and more infrequent than systematic.’” Id. at *11.

The same is true here. Although the Moving Defendants appear in California from time to

time to play MLB games against California-based MLB Clubs, they do so as mere visitors to this


10


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

State. As one Court aptly put it, “While it is clear that [the defendant] has stepped through the door,

there is no indication that it has sat down and made itself at home. Defendant was a “visitor to the

forum; the ‘physical presence’ necessary for an assertion of general jurisdiction requires more.”

Glencore Grain Rotterdam B.V. v. Shivnath Rai Harnarain, Co., 284 F.3d 1114, 1124-25 (9th Cir.

2002). Accordingly, the Moving Defendants’ contacts with California are insufficient to confer

general jurisdiction.

2. The Court Lacks Specific Jurisdiction Because The Moving Defendants Do Not Have Minor League Affiliates That Play In California And Therefore Plaintiffs’ Claims Do Not Arise Out Of The Moving Defendants’ Contacts With California.

“The inquiry whether a forum State may assert specific jurisdiction over a nonresident

defendant focuses on the relationship among the defendant, the forum, and the litigation.” Walden v.

Fiore, 134 S.Ct. 1115, 1121 (2014) (internal citations omitted). “For a State to exercise jurisdiction

consistent with due process, the defendant’s suit-related conduct must create a substantial connection

with the forum State.” Id.

Courts in the Ninth Circuit use a three-part test to determine whether specific jurisdiction

exists: (i) the nonresident defendant must purposefully direct his activities or consummate some

transaction with the forum or residents 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; (ii) the claim must be one which arises out of or relates to the defendant’s

forum-related activities; and (iii) the exercise of jurisdiction must comport with fair play and

substantial justice, i.e., it must be reasonable. Boshcetto v. Hansing, 539 F.3d 1011, 1016 (9th Cir.

2008). “Each of the three tests must be satisfied to permit a district court to exercise limited

personal jurisdiction over a non-resident defendant.” Peterson v. Kennedy, 771 F.2d 1244, 1261 (9th

Cir. 1985) (emphasis added).7 7 If the court finds that one of the prongs has not been met, it generally stops the inquiry and does not reach the other two prongs. See, e.g., Leroy-Garcia v. Brave Arts Licensing, No. C 13-01181 LB, 2013 U.S. Dist. LEXIS 109872, at *36 n.8 (N.D. Cal. Aug. 5, 2013) (“Because the court finds that Plaintiffs did not meet their burden to show that the first prong of the applicable test for specific personal jurisdiction, the court does not reach the second and third prongs of that test.”); Salesbrain, Inc. v. AngelVision Techs., No. C 12-05026 LB, 2013 U.S. Dist. LEXIS 40607, at *36 n.14 (N.D. Cal. Mar. 21, 2013) (same).


11


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

a. The Moving Defendants Did Not Purposefully Avail Themselves Of Conducting Activities In California With Respect To Minor League Players.

The purposeful availment factor examines whether the defendant’s contacts with the forum

are attributable to its own actions or are solely the actions of the plaintiff. Burger King Corp. v.

Rudzewicz, 471 U.S. 462, 475 (1985). As the Ninth Circuit has explained, “[i]n order to have

purposefully availed oneself of conducting activities in the forum, the defendant must have

performed some type of affirmative conduct which allows or promotes the transaction of business

with the forum state.” Sinatra v. Nat’l Enquirer, Inc., 854 F.2d 1191, 1195 (9th Cir. 1988). Because

the Moving Defendants do not have any Minor League affiliates in California or otherwise play

Minor League games in California, they have not transacted any business in this State with respect to

the claims at issue in this case.

In cases like the instant case alleging, inter alia, violations of the wage and hour laws,

Defendants’ activities must satisfy the three-part “effects test” otherwise known as the “purposeful

direction” analysis. See Enriquez v. Interstate Group, LLC, No. 11-CV-05155 YGR, 2012 WL

3800801, at *3 (N.D. Cal. Aug. 31, 2012) (applying purposeful direction to FLSA claim); Holliday

v. Lifestyle Lift, Inc., No. C 09–4995 RS, 2010 WL 3910143, at *3 (N.D. Cal. Oct. 5, 2010) (noting

that policy of denying overtime compensation fits within the “purposeful direction” analysis).8 To

satisfy this test, Defendants must have: (1) committed an intentional act that was; (2) expressly

aimed at the forum state and which; (3) caused harm that Defendants knew was likely to be suffered

in the forum state. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 803 (9th Cir. 2004).

Even assuming, arguendo, that Defendants’ alleged refusal to pay Plaintiffs overtime

compensation is deemed to be an “intentional act,” the Moving Defendants could not have directed

their actions at California, much less have done so “expressly,” because none of the Minor League

Players who played for any of the Minor League teams affiliated with the movant Clubs played

8 The first part of the minimum contacts test is subdivided into purposeful direction, which generally applies to tort claims, and purposeful availment, which generally applies to contract claims. Yahoo! Inc. v. La Ligue Contre Le Racisme Et L’Antisemitisme, 433 F.3d 1199, 1206 (9th Cir. 2006). FLSA claims generally are analyzed as tort claims under purposeful direction. See Enriquez, 2012 WL 3800801 at *3; Holliday, 2010 WL 3910143, at *3.


12


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

games for these teams in California. See Schwarzenegger, 374 F.3d at 803. The Complaint itself

makes clear that the Moving Defendants’ contacts with Minor League Players are the exact opposite

of “purposeful availment” on the Moving Defendants’ part. To the contrary, and as the Complaint

alleges, any contacts between the Moving Defendants and Minor League Players in California are

simply a function of where Plaintiffs choose to live during the offseason. (Compl., ¶ 122) Thus, the

second prong cannot be met. Walden v. Fiore, 134 S. Ct. at 1123 (“[a] forum State’s exercise of

jurisdiction over an out-of-state intentional tortfeasor must be based on intentional conduct by the

defendant that creates the necessary contacts with the forum.”). This would be true even if one of

the players on a Minor League team affiliated with a Moving Defendant was a California resident.

(“[Defendant’s] actions in Georgia did not create sufficient contacts with Nevada simply because he

allegedly directed his conduct at plaintiffs whom he knew had Nevada connections.”). Id. at 1125.

Accordingly, none of the Moving Defendants have purposefully availed themselves of

conducting activities in the forum with respect to Minor League Players.

b. Plaintiffs’ Claims Do Not Arise Out Of Or Relate To The Defendants’ Forum-Related Activities.

Even if the Court concludes that the Moving Defendants purposefully availed themselves of

conducting business in California, there can be no dispute that the purported claims here do not arise

out of and are unrelated to those Clubs’ limited contacts with California. “To determine whether a

claim arises out of forum-related activities, courts apply a ‘but for’ test.” Doe v. Unocal Corp., 248

F.3d 915, 924-25 (9th Cir. 2001). The question is whether the plaintiffs’ claims would have arisen

but for the defendant’s contacts with California. Id.

Here, it cannot be said that the Plaintiff Minor League players’ claims arose out of the

Moving Defendants’ contacts with California. None of these players worked for the Moving

Defendants or their Minor League affiliates in California. And, even though the Defendants’ Major

League Players worked in California while playing Major League Baseball games, neither these

players – nor the time they spent playing Major League games – are the subject of this action.

The court’s decision in Thos P. Gonzalez Corp. v. Consejo Nacional de Produccion de Costa

Rica, 614 F.2d 1247 (9th Cir. 1980), is illustrative and supports the granting of the Moving


13


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Defendants’ motion. In that case, the Ninth Circuit concluded that although the defendant regularly

entered into sale and purchase agreements with a California resident, made payments in California,

frequently contacted the plaintiff, and visited California to complete two prior transactions, those

other California connections did not give California jurisdiction over a dispute regarding a new sale

and purchase agreement. The court explained: “We find the crucial fact to be that [the] visit

pertained to transactions not at issue in this case.” Id. at 1254. The same is true here. Although

Plaintiffs allege that “all Defendants transact a significant amount of business in California,”

(Compl., ¶ 118), those alleged “transactions” are not at issue in this case because the Moving

Defendants do not have Minor League teams in California and do not employ Minor League players

who play games in California; and any time spent by Major League players in California is

completely unrelated to the claims at issue in this case. Hence, there can be no claim that the Minor

League players claims arise out of the Moving Defendants’ forum-related activities in California.

c. The Exercise of Jurisdiction Over Any Of The Moving Defendants Would Not Be Reasonable.

The third part of the specific personal jurisdiction analysis examines whether the exercise of

jurisdiction would be reasonable. Courts consider seven factors when making this determination: (1)

the extent of the defendant’s purposeful interjection into the forum state’s affairs; (2) the burden on

the defendant of defending in the forum; (3) the extent of conflict with the sovereignty of the

defendant’s state; (4) the forum state’s interest in adjudicating the dispute; (5) the most efficient

judicial resolution of the controversy; (6) the importance of the forum to the plaintiffs interest in

convenient and effective relief; and (7) the existence of an alternative forum. CE Distrib., LLC., 380

F.3d at 1107, 1112 (9th Cir. 2004). These factors weigh in favor of the Moving Defendants.

The first factor has been discussed in greater detail above. Defendants’ contacts with

California are limited to those occasions when the MLB Clubs visit this state to play MLB games.

The Moving Defendants are not California corporations, are not licensed to do business in

California, and do not own (or rent) any property here. In these circumstances, the Moving

Defendants have not sought the protection of California’s laws, and can hardly be said to have

“purposefully interjected” themselves into California’s affairs.


14


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

Regarding the second factor, the burden on the Moving Defendants of defending in

California is substantial because it would require each Club’s representatives and employees to

travel out-of-state to litigate claims that did not arise here. Because the Moving Defendants do not

have players who played Minor League games in California, the Moving Defendants could not have

reasonably foreseen being called into court in this State for these claims. Accordingly, this factor

favors the Moving Defendants.

The third factor is neutral since there is no apparent conflict between the sovereignty of

California and any of the Defendants’ resident states.

With respect to the fourth factor, California does not have a compelling interest in

adjudicating the dispute where the conduct at issue did not take place within its borders. Although

California courts have an interest in enforcing this state’s employment laws, this interest is mitigated

where none of the events at issue with respect to the Moving Defendants took place in California.

Fed. Deposit Ins. Corp. v. British-Am. Ins. Co., Ltd., 828 F.2d 1439, 1444 (9th Cir. 1987) (California

has less of an interest in adjudicating disputes where the activity at issue did not occur in California),

citing Kipperman v. McCone, 422 F. Supp. 860, 874 (N.D. Cal. 1976).

The fifth factor concerns the efficiency of the forum. “In evaluating this factor, [courts look]

primarily at where the witnesses and the evidence are likely to be located.” Core-Vent Corp. v.

Nobel Indus. AB, 11 F.3d 1482, 1489 (9th Cir. 1993). This factor weighs heavily in favor of

dismissal. Because the Moving Defendants do not have a presence in this state other than the times

that they play MLB games here, the evidence related to the Moving Defendants’ Minor League

operations exists exclusively outside of California. Litigating Plaintiffs’ claims against the Moving

Defendants in California would be demonstrably inconvenient because out-of-state witnesses would

be required to travel here to testify about events which occurred outside of California.

The sixth factor concerns the convenience and effectiveness of relief for the plaintiff. “[I]n

this circuit, the plaintiff’s convenience is not of paramount importance.” Dole Food Co. v.

Watts, 303 F.3d 1104, 1116 (9th Cir. 2002). However, even if it were, we note that only 4 out of the

34 named Plaintiffs reside in this State.

The seventh and final factor concerns the availability of an alternate forum. Plaintiffs bear


15


1

2

3

4

5

6

7

8

9

10

11

12

13

14

15

16

17

18

19

20

21

22

23

24

25

26

27

28

the burden of proving the unavailability of an alternative forum. Core-Vent Corp., 11 F.3d at 1490.

Plaintiffs cannot meet their burden because each Club’s principal place of business lies outside of

California and, therefore, the Moving Defendants are subject to general jurisdiction in those other

states. Moreover, the Moving Defendants are also subject to jurisdiction in the states where

Plaintiffs’ claims arose – e.g., Florida. As set forth more fully in Defendants’ Motion to Transfer

Venue, the State of Florida provides an alternative and more convenient forum for this dispute.9

Weighing all of these seven considerations, the balance of factors clearly favors dismissing

Plaintiffs’ claims against the Moving Defendants for lack of personal jurisdiction.

IV. CONCLUSION

As demonstrated above, this Court can assert neither general nor specific personal

jurisdiction over any of the Moving Defendants. Accordingly, the Court should grant the instant

motion and dismiss these Defendants from this case.

Dated: May 23, 2014 PROSKAUER ROSE LLP

ELISE M. BLOOM (admitted pro hac vice) HOWARD L. GANZ NEIL H. ABRAMSON (admitted pro hac vice) ADAM M. LUPION (admitted pro hac vice) LAURA REATHAFORD

By:/s/ Elise M. Bloom

Elise M. Bloom Attorneys for Defendants

9 Simultaneous with the filing of this motion, all Defendants have filed a Motion to Transfer Venue pursuant to 28 U.S.C. § 1404(a). In the event that the Court denies this Motion to Dismiss, the Moving Defendants herein move in the alternative to transfer venue, and respectfully join in the Motion to Transfer Venue.


Documents

Senne v. MLB - Motion to Dismiss