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Neuer v. Dental Resource Systems, Inc.

United States District Court, D. Kansas

July 27, 2015

ERIC NEUER, doing business as Prairie Point Orthodontics, P.A., on behalf of itself and all those similarly situated, Plaintiff,
v.
DENTAL RESOURCE SYSTEMS, INC., et. al., Defendants.

MEMORANDUM AND ORDER

CARLOS MURGUIA, District Judge.

The matter before the court is on defendants' motion to dismiss (Doc. 19), in which defendants argue that the court lacks jurisdiction to hear this case and that plaintiff has failed to state a claim upon which relief may be granted. Related to that motion, plaintiff filed a motion for leave to file a surreply (Doc. 23).

I. Case Summary

Plaintiff Eric Neuer, doing business as Prairie Point Orthodontics, P.A., and on behalf of itself and all those similarly situated, filed this class action against defendants Dental Resource Systems, Inc. ("DRS"), a Delaware corporation; John Harris, an individual residing in the state of Florida; Richard Amy, an individual residing in the state of California; and Mark Montgomery, an individual residing in the state of Oregon. Defendant Harris is the president and chief executive officer of DRS and defendants Amy and Montgomery are licensed dentists who appear to work for DRS in some capacity. Plaintiff primarily alleges defendants faxed unsolicited advertisements to his business in violation of the Telephone Consumer Protection Act ("TCPA"), 47 U.S.C. § 227. He also brings claims of conversion, negligence, and negligence per se.[1]

II. Facts

Plaintiff alleges the following facts. On approximately twenty-one occasions between March 1, 2012 and December 18, 2014, defendants faxed three different unsolicited advertisements to plaintiff, at his business. The three faxes advertise a dental service and textbook authored (in part) by defendant Montgomery, appear in letter form, and are signed by defendants Harris, Montgomery, and Amy, respectively. (Docs. 17-1, 17-2, and 17-3.) Aside from the second fax's different letterhead, the layout and form of each are virtually identical, each including DRS's name (including its acronym form), address, and website. Every fax also includes the same opt-out language at the bottom of the fax. As for damages, plaintiff pleads statutory damages pursuant to the TCPA and actual damages in the form of consumed toner, paper, and fax machine memory.

III. Legal Standards - Motion to Dismiss

A. Personal Jurisdiction under Federal Rule of Civil Procedure 12(b)(2)

Plaintiff has the burden to establish personal jurisdiction over each defendant. OMI Holdings, Inc. v. Royal Ins. Co. of Canada, 149 F.3d 1086, 1091 (10th Cir. 1998). Because the court decides this motion on the basis of affidavits and other written materials, plaintiff only needs to make a prima facie showing of personal jurisdiction. Id. The court assumes the allegations in the complaint are true to the extent they are not controverted, and resolves all factual disputes in plaintiff's favor. See Shrader v. Biddinger, 633 F.3d 1235, 1239 (10th Cir. 2011) (discussing a motion to dismiss for lack of personal jurisdiction and stating "[w]e must resolve any factual disputes in the plaintiff's favor"). "In order to defeat a plaintiff's prima facie showing of jurisdiction, a defendant must present a compelling case demonstrating that the presence of some other considerations would render jurisdiction unreasonable.'" Proud Veterans, LLC v. Ben-Menashe, 12-CV-1126-JAR, 2014 WL 791200, at *4 (D. Kan. Feb. 27, 2014) (quoting OMI Holdings, 149 F.3d at 1091)).

B. Failure to State a Claim under Federal Rule of Civil Procedure 12(b)(6)

Federal Rule of Civil Procedure 12(b)(6) governs motions to dismiss for failure to state a claim. See Fed.R.Civ.P. 12(b)(6). The Supreme Court set forth the standard for pleadings in Bell Atlantic Corp. v. Twombly, stating that pleadings should include "enough facts to state a claim to relief that is plausible on its face." 550 U.S. 544, 570 (2007). The pleading should include "more than labels, conclusions, and a formulaic recitation of the elements of a cause of action." In re Motor Fuel Temperature Sales Practices Litig., 534 F.Supp.2d 1214, 1216 (D. Kan. 2008). The court must "accept as true all well-pleaded factual allegations in the complaint and view them in the light most favorable to the plaintiff." Burnett v. Mtg. Elec. Registration Sys., Inc., 706 F.3d 1231, 1235 (10th Cir. 2013). And the court must "resolve all reasonable inferences in the plaintiff's favor." Diversey v. Schmidly, 738 F.3d 1196, 1199 (10th Cir. 2013) (quoting Morse v. Regents of the Univ. of Colo., 154 F.3d 1124, 1126-27 (10th Cir. 1998)).

IV. Analysis

Defendants argue the court lacks personal jurisdiction over them. The court has federal question subject matter jurisdiction. 28 U.S.C. § 1331; Mims v. Arrow Fin. Servs., LLC, 132 S.Ct. 740 (2012). While there are generally two types of personal jurisdiction (general and specific), plaintiff's response only addresses specific jurisdiction. The court will therefore only analyze specific jurisdiction.

A. Specific Jurisdiction

The court's personal jurisdiction over defendants depends on the law of the forum state, unless the federal statute in question authorizes nationwide service of process. Fed.R.Civ.P. 4(e); Marcus Food Co. v. DiPanfilo, 671 F.3d 1159, 1166 (10th Cir. 2011). In this case, plaintiff alleges a violation of the TCPA, which does not authorize nationwide service of process in private actions. 47 U.S.C. § 227; Sojka v. Loyalty Media LLC, No. 14-CV-770, 2015 WL 2444506, at *2 (N.D. Ill. May 20, 2015). Therefore, the court must determine: (1) whether the defendant's conduct falls within the forum state's long-arm statute, and (2) whether the exercise of personal jurisdiction over the defendant satisfies the constitutional guarantee of due process. See Dudnikov v. Chalk & Vermilion Fine Arts, Inc., 514 F.3d 1063, 1070 (10th Cir. 2008) (citing Trujillo v. Williams, 465 F.3d 1210, 1217 (10th Cir. 2008)). Because Kansas courts construe the long-arm statute to the same limits allowed by federal due process, the court proceeds directly to the due process inquiry. OMI Holdings, 149 F.3d at 1090.

Analyzing due process is a two-step process. First, the court must find that the defendant has "minimum contacts" with the forum state such that the defendant "should reasonably anticipate being haled into court there." Employers Mut. Cas. Co. v. Bartile Roofs, Inc., 618 F.3d 1153, 1160 (10th Cir. 2010) (quoting OMI Holdings, 149 F.3d at 1091). Second, assuming those minimum contacts exist, the defendant's contacts must "not offend traditional notions of fair play and substantial justice." ...


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