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Kc Ravens, LLC v. Micah Energy Corporation

United States District Court, W.D. Missouri, Western Division

September 11, 2014

KC RAVENS, LLC, Plaintiff,


GREG KAYS, Chief District Judge.

This lawsuit arises from a guarantee to pay a promissory note. Plaintiff KC Ravens, LLC ("KC Ravens") alleges Defendant Micah Energy Corporation ("Micah") breached an agreement guaranteeing that a $1, 000, 000 loan made by KC Ravens would be repaid. KC Ravens also alleges that Defendant Mike Snell ("Snell"), who represented himself as Micah's CEO, made negligent and fraudulent misrepresentations to induce KC Ravens into making the loan.

Now before the Court is Defendant Snell's Motion to Dismiss Counts II and III for Lack of Personal Jurisdiction (Doc. 13) brought under Federal Rule of Civil Procedure 12(b)(2). Snell, a non-resident of Missouri, contends that Plaintiff's First Amended Petition (Doc. 1-2) ("the Petition") fails to make a prima facie showing of personal jurisdiction over him. Holding that the Petition sets forth sufficient factual allegations to support a reasonable inference that this Court has personal jurisdiction over Snell, the motion is DENIED.


"Personal jurisdiction over a defendant represents the power of a court to enter a valid judgment imposing a personal obligation or duty in favor of the plaintiff." Viasystems, Inc. v. EBM Pabst St. Georgen GmbH & Co., KG, 646 F.3d 589, 592 (8th Cir. 2011) (internal quotation marks omitted). In a diversity action, a federal court may exercise personal jurisdiction over a non-resident defendant only to the extent permitted by the forum state's long-arm statute and the Due Process Clause. Johnson v. Arden, 614 F.3d 785, 794 (8th Cir. 2010). Thus, in order for this Court to exercise personal jurisdiction over Snell: (1) Missouri's Long-Arm Statute must be satisfied; and (2) Snell must have sufficient contacts with Missouri to satisfy due process concerns. Id. Although similar in nature, these are separate inquiries. Viasystems, 646 F.3d at 593 n.2 (citing Bryant v. Smith Interior Design Grp., 310 S.W.3d 227, 231 (Mo. 2010)).

The plaintiff bears the burden of making a prima facie showing that the court possesses personal jurisdiction over the defendant. Steinbuch v. Cutler, 518 F.3d 580, 585 (8th Cir. 2008); Miller v. Nippon Carbon Co., Ltd., 528 F.3d 1087, 1090 (8th Cir. 2008). This showing is made "not by the pleadings alone, but by the affidavits and exhibits" supporting or opposing the motion. Dever v. Hentzen Coatings, Inc., 380 F.3d 1070, 1072-73 (8th Cir. 2004). The evidence required for a prima facie showing is minimal. Johnson, 614 F.3d at 794. But, the court views the facts in the light most favorable to the nonmoving party and resolves all factual conflicts in favor of the nonmoving party. Epps v. Stewart Info. Servs. Corp., 327 F.3d 642, 647 (8th Cir. 2003).

Factual and Procedural Background

Plaintiff KC Ravens is a Kansas limited liability company that is located and operates in Kansas City, Missouri. KC Ravens' sole member is Vince Hodes, a Kansas citizen. Defendant Micah is an Arizona corporation with its principal place of business there. Defendant Snell resides in Texas. KC Ravens filed this lawsuit in the Circuit Court of Jackson County, Missouri, and Snell removed the case to federal court by invoking the Court's diversity jurisdiction.

The Petition contains three claims. Count I alleges Defendant Micah breached its contract to guarantee a $1, 000, 000 bridge loan. Counts II and III, which are at issue here, respectively allege that Snell tortiously induced KC Ravens into making this loan by engaging in negligent and fraudulent misrepresentation.

The Petition claims the Court has personal jurisdiction over Snell because he committed "tortious acts within the state of Missouri, giving rise to the [P]laintiff's causes of action against him." Pet. at ¶ 4. Specifically, the Petition alleges that Snell represented himself as Micah's CEO and acted with Micah's actual or apparent authority; that Micah sought out the loan in Kansas City, Missouri; and that Snell induced KC Ravens into making the loan by making numerous false representations which KC Ravens received while in Kansas City, Missouri. Pet. at ¶¶ 22, 56-7, 66-7. The alleged misrepresentations include the following: that Micah had sufficient capital to guaranty the borrower's obligations; that Micah had accounts with Chase Bank with financial activity in excess of $500, 000, 000 for the period August 2009 to August 2011; that Micah had extensive experience in providing financial services, engineering analysis, and business development advisory services; and that since 2005 Micah had been a party to over 400 corporate and municipal bond offerings, and since 2007 directly responsible for 200 offers exceeding $50, 000, 000, 000. Pet. at ¶ 57. Other misrepresentations were that Snell had a doctorate in nuclear engineering from MIT; that he dealt heavily with the BUSH 41 Group; and that he previously ran large hedge funds. Id. The Petition also alleges that when Snell, or someone acting on his behalf, made these misrepresentations, he knew or should have known that they were false. Pet. at ¶ 60.

Due to these misrepresentations, KC Ravens sustained damages of approximately $2, 000, 000 in Kansas City, Missouri. Pet. at ¶¶ 64, 74; Aff. at ¶¶ 9-10. Finally, the Petition alleges, and the loan documents confirm, that Snell on behalf of Micah executed a loan guarantee on February 1, 2012, in Kansas City, Missouri. Pet. at ¶ 26, Pet. Exh. B, Pet. Exh. C.


Snell contends that Missouri's Long-Arm Statue is not satisfied, and that he lacks sufficient minimum contacts with Missouri to satisfy due process concerns. ...

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