United States District Court, W.D. Missouri, Western Division
ORDER DENYING DEFENDANT KATZ'S MOTION TO
case arises from an alleged scheme to defraud a group of
investors. Plaintiffs, a limited liability company and eight
individual investors based in Kansas City, Missouri,
allege the Defendants, who are based in the New York area,
engaged in fraud, misrepresentation, breach of fiduciary
duty, and breach of contract by failing to disclose crucial
information, embezzling from the company, and providing
before the Court is pro se Defendant David Katz's
(“Katz”) Motion to Dismiss (Doc. 33) and Motion
to Dismiss Plaintiff's Second Amended Complaint (Doc.
Katz, a co-founder of Defendant N2 Global Solutions, Inc.
(“N2 Global”), moves to dismiss on three
independent grounds: improper service of process, lack of
personal jurisdiction, and failure to state a claim. These
arguments are without merit, and Defendant's motions are
Plaintiffs properly served Defendant.
hired a private process server who attempted to serve Katz at
¶ 2 Global's place of business, 160 East 89th
Street, Apt. 4C, in New York City. According to the process
server's affidavit, on March 6, 2018, at 10:10 a.m., he
knocked on the apartment door and no one answered. The
doorman told him someone would be in after 7:00 p.m., and so
the process server returned at 7:30 p.m. and knocked on the
door again. No. one answered. After making reasonable efforts
to find someone of who was legally eligible and willing to
accept service, the process server affixed a copy of the
summons, civil cover sheet, and complaint to the door. The
next day he mailed the documents to Katz at the above address
in a postpaid wrapper marked “personal &
confidential” with no indication that the mailing
regarded a legal matter. He sent the package via U.S. Postal
Service first-class, regular mail.
Rule of Civil Procedure 4(e)(1) provides that an individual
“may be served in a judicial district of the United
States by following state law for serving a summons in an
action brought in courts of general jurisdiction in the state
where the district court is located or where service is
made.” Since service was made in the state of New York,
§ 308 of New York's Civil Practice Law & Rules
governs service of process. This rule provides that where,
with due diligence, service cannot be made on a natural
person, service may be made by affixing the summons to the
door of the person's “actual place of
business” and “by mailing the summons by first
class mail to the person to be served at his or her actual
place of business in an envelope bearing the legend
‘personal and confidential' and not indicating on
the outside . . . that the communication is from an attorney
or concerns” a lawsuit. This is precisely the procedure
the process server followed, so service upon Katz was valid.
Court is unpersuaded by Katz's argument that he was not
properly served because he swears he did not live or reside
at the apartment and he did not conduct business there in
2018.Katz does not deny working at the address,
that the address was his actual place of business, that the
address is N2 Global's place of business, or that he is
an N2 Global co-founder. Accordingly, the Court holds
Plaintiffs have demonstrated service on Katz was proper.
Court has personal jurisdiction over Defendant.
jurisdiction concerns “whether the controversy or the
defendant has sufficient contracts, ties, or relationships
with the forum to give the court the right to exercise
judicial power over the defendant . . . .” 5B Charles
Alan Wright & Arthur R. Miller, Federal Practice and
Procedure § 1351 (3d ed. 2004). Personal jurisdiction
can be specific or general. Viasystems, Inc. v. EBM-Pabst
St. Georgen GmbH & Co., KG, 646 F.3d 589, 593 (8th
Cir. 2011). Plaintiffs allege the Court possesses specific
jurisdiction over Katz.
diversity case such as this one, personal jurisdiction exists
only to the extent permitted by the forum state's
“long-arm statute” and the Due Process Clause of
the Fourteenth Amendment. Myers v. Casino Queen,
Inc., 689 F.3d 904, 909 (8th Cir. 2012); see
Fed. R. Civ. P. 4(k)(1)(A). Missouri's long-arm statute
authorizes personal jurisdiction over defendants who transact
business, contract, or commit a tort within the state.
Viasystems, 646 F.3d at 593; Mo. Rev. Stat. §
506.500. These categories are construed broadly, and the
statute provides jurisdiction to the full extent permitted by
the Due Process Clause. Id.
the Missouri long-arm statute authorizes the exercise of
jurisdiction over nonresidents to the extent permissible
under the due process clause, ” a federal court need
only consider “whether the assertion of personal
jurisdiction would violate” due process. Aly v.
Hanzada for Import & Export Co., LTD, 864 F.3d 844,
849 (8th Cir. 2017) (quotations and citations
omitted).The court considers whether there is
“sufficient minimum contacts between a defendant and
the forum state so that jurisdiction over a defendant with
such contacts may not offend traditional notions of fair play
and substantial justice.” Id. (quotations and
survive a motion to dismiss for lack of personal
jurisdiction, a plaintiff must plead sufficient facts to
support a reasonable inference that the defendant is subject
to jurisdiction within the state. Creative Calling Sols.,
Inc. v. LF Beauty Ltd., 799 F.3d 975, 979 (8th Cir.
2015). Once a motion has been filed, the parties may submit
evidence, such as affidavits, to bolster their positions.
Id. The plaintiff bears the burden of proof and must
make a prima facie showing that personal jurisdiction exists.
Fastpath, Inc. v. Arbela Tech. Corp., 760 F.3d 816,
820 (8th Cir. 2014). The plaintiff must establish personal
jurisdiction by a preponderance of the evidence at trial or
when the court holds an evidentiary hearing. Id.
Where, as here, the case is at the motion stage, the court
may not dismiss for lack of personal jurisdiction if the
evidence, viewed in the light most favorable to the
plaintiff, is sufficient to support a conclusion that the
exercise over the defendant is proper. Id.
case, after carefully reviewing the Second Amended Complaint
(“the Complaint”) (Doc. 52) and the evidence on
the record, the Court finds Plaintiffs have established by a
preponderance of the evidence that Katz has sufficient
minimum contacts with Missouri for the Court to exercise
personal jurisdiction over him. Although Katz denies
conducting any business related to this suit in Missouri,
Plaintiffs have placed more credible evidence in the record
demonstrating that Katz repeatedly reached out to Missouri to
commit the allegedly tortious conduct. Plaintiffs submitted
affidavits detailing phone calls and emails between Katz in
New York and Plaintiffs in Kansas City, some of which were
initiated by Katz. Additionally, Plaintiffs submitted an
affidavit from an attorney stating that he “attended
several investor solicitation meetings presented by
[Defendant Paul] Amelio and [Defendant David] Katz. These
presentations were all made in Kansas City,
Missouri.” Decl. of Arthur E. Fillmore, II at
¶ 8 (Doc. 19-1) (emphasis added). Plaintiff Jeanette
Prenger also swore under oath that in 2017, “the
Defendants requested that I introduce them to investors in
Kansas City, ” and she subsequently introduced them to
various government officials in Missouri and a half-dozen
executives in Kansas City who were potential investors. Decl.
of Jeanette E. Prenger at ¶ 6 (Doc. 19-3). Katz's
actual presence in Missouri to ...