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St. Louis Motorsports, LLC v. Gay

United States District Court, E.D. Missouri, Eastern Division

February 16, 2018

ST. LOUIS MOTORSPORTS, LLC, Plaintiff,
v.
GAY, JR., ET AL., Defendants.

          MEMORANDUM AND ORDER

          PATRICIA L. COHEN UNITED STATES MAGISTRATE JUDGE

         This matter is before the Court on Plaintiff Rudy Gay's motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(2) and 12(b)(6).[1] (ECF No. 21). Plaintiff St. Louis Motorsports, LLC (“STL Motorcars”) opposes the motion, and the Court heard oral arguments on February 30, 2018. (ECF Nos. 25 & 45). For the reasons stated below, the Court grants the motion.[2]

         I.Factual and Procedural Background

         STL Motorcars filed this action for fraud and negligent misrepresentation in the Circuit Court of the County of St. Louis (ECF No. 5). Mr. Gay, with the consent of Defendant Pro Motorsports, removed the action to this Court. (ECF No. 2). The facts, as alleged in the petition, are as follows:

         STL Motorcars is a Missouri limited liability company that buys, sells, trades, and repairs high-end, luxury vehicles. (ECF No. 5 at ¶ 2). Pro Motorsports, also a Missouri limited liability company, represents professional athletes, executives, and companies in transactions in the exotic and luxury car market. (Id. at ¶ 4). In November 2013, Pro Motorsports represented Mr. Gay, a professional basketball player, in the purchase of a 2013 Rolls Royce Phantom Coupe (“Phantom”). (Id. at ¶¶ 6, 9, 10).

         In February 2016, Pro Motorsports, “acting as Mr. Gay's agent, ” offered to sell the Phantom back to STL Motorcars. (Id. at ¶ 15). Pro Motorsports assured STL Motorcars that the Phantom was in “perfect” and “like new” condition, and a March 2016 CarFax vehicle history report and warranty check revealed no accidents or damage to the vehicle. (Id. at ¶¶ 16, 17). STL Motorcars repurchased the Phantom from Pro Motorsports on March 4, 2016 for $250, 000.[3](Id. at ¶19).

         In April 2017, STL Motorcars obtained a new CarFax history report and warranty check, which revealed that, in July 2015, the Phantom sustained extensive damage to its undercarriage. (Id. at ¶¶ 20- 22). STL Motorcars alleges that “[d]ue to the Phantom's damage history and Defendants' concealment and misrepresentations, STL Motorcars has been unable to sell the Phantom.” (Id. at ¶ 27).

         STL Motorcars filed a two-count petition against Defendants Mr. Gay and Pro Motorsports alleging claims of fraud and negligent misrepresentation. (Id.). STL Motorcars asserts that Mr. Gay is subject to jurisdiction in Missouri because Pro Motorsports, a Missouri entity, “was acting as Mr. Gay's agent” when it sold STL Motorcars the Phantom. (Id. at ¶¶ 5-7). STL Motorcars alleged: “Jurisdiction is proper in this Court pursuant to Mo. Rev. Stat. § 506.500 in that the parties transacted business within Missouri and because Defendants committed tortious acts towards STL Motorcars within Missouri.” (Id at ¶ 7).

         Mr. Gay moves to dismiss the case pursuant to Rule 12(b)(2), arguing that he is not subject to jurisdiction in Missouri because he was not a party to the transaction between STL Motorcars and Pro Motorsports, he has no connection to Missouri, and Pro Motorsports was not acting as his agent. (ECF No. 21). In regard to agency, Mr. Gay asserts that he does not have the agency relationship with Pro Motorsports necessary to establish contact with Missouri because: (1) Mr. Gay had no legal relationship with STL Motorcars that Pro Motorsport had the power to alter; and (2) Mr. Gay had no right to control the conduct of Pro Motorsports in its sale of the Phantom to STL Motorcars. (Id at 8).

         In response, STL Motorcars maintains that it pleaded sufficient facts to support a reasonable inference that Mr. Gay is subject to jurisdiction in Missouri. (ECF No. 25). More specifically, STL Motorcars states that: Mr. Gay contracted with one Missouri entity and authorized it to sell the Phantom to another Missouri entity; Mr. Gay owned and possessed the Phantom throughout the negotiations between STL Motorcars and Pro Motorsports; and Mr. Gay delivered the Phantom to STL Motorcars in St. Louis, Missouri. Additionally, STL Motorcars argues that Pro Motorsports was Mr. Gay's agent and, therefore, Pro Motorsports' acts or conduct may be the basis for jurisdiction over Mr. Gay.

         In support of its memorandum in opposition to Mr. Gay's motion to dismiss, STL Motorcars submitted: a Declaration of Brian Tull; printouts from Pro Motorsports' website; and text messages exchanged between Mr. Tull and Mr. Lewis from January 26, 2016 through February 19, 2016. (ECF No. 25-1). In his declaration, Mr. Tull states:

• When Mr. Lewis contacted Mr. Tull seeking a bid on the Phantom, Mr. Lewis “informed me that he was working on behalf of Mr. Gay and had authority to negotiate a sale price of the Phantom”;
• Mr. Gay maintained “ownership and possession” of the Phantom throughout the negotiations;
• Based on Pro Motorsports' conduct and statements, Mr. Tull believed that Pro Motorsports “was in discussions with Mr. Gay throughout the negotiations” and did not have authority to act or agree to any terms without MR. Gay's approval;
• Mr. Gay only titled ownership of the Phantom to Pro Motorsports after STL Motorcars and Pro Motorsports agreed on a final sales price; and
• STL Motorcars received the Phantom in Missouri directly from Mr. Gay's personal ...

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