Opinion
1:19-cv-00123-SPB-RAL
05-01-2022
DAVID E. ALEXANDER, Plaintiff v. NATE BIRKMEIER, PRESIDENT ERC, Defendant
SUSAN PARADISE BAXTER, UNITED STATES DISTRICT JUDGE
REPORT AND RECOMMENDATION
RICHARD A. LANZILLO, UNITED STATES MAGISTRATE JUDGE.
I. Recommendation
For the reasons stated below, it is respectfully recommended that the Court grant Defendant's motion to dismiss (ECF No. 21) Plaintiff's Complaint pursuant to Fed. R. Civ. 12(b)(2) because the Court lacks personal jurisdiction over Defendant. In the alternative, it is further recommended that this action also be dismissed based on Plaintiff's failure to prosecute.
II. Report
A. Background
Plaintiff David E. Alexander (Alexander) commenced this action against Defendant Nate Berkmeier (Berkmeier) for alleged violations of the Fair Debt Collection Practices Act (FDCPA), 15 U.S.C. §§ 1692, et seq. ECF No. 7. Although Alexander named Berkmeier in the complaint, the body of the complaint refers only to the alleged conduct of “ERC, ” a dissolved corporation with which Berkmeier was previously associated. The complaint alleges that, in July 2018, ERC notified credit reporting agencies that Alexander had failed to pay $874 on an account assigned from Comcast, a telecommunications and entertainment company, to ERC. Id., ¶ 4. The complaint further alleges that ERC received a letter from Alexander on March 5, 2019, requesting that it validate the debt under 15 U.S.C. § 1692g, but ERC did not respond. Id., ¶ 5. The complaint purports to assert twelve claims under the FDCPA and seeks damages in the amount of $36,400.00, plus costs of suit.
The Complaint identifies the Defendant as “Nate Birkmeier, President ERC, ” ECF No. 7, p. 1, but Defendant's counsel provides the correct spelling of his last name as “Berkmeier, ” which the undersigned will use in this Report and Recommendation.
The Court has subject matter jurisdiction over this action under 28 U.S.C. 1331. The U.S. District Court for the Eastern District of Pennsylvania transferred this action to this judicial district pursuant to 28 U.S.C. §§ 1404, 1406. ECF No. 3. Alexander is a prisoner within this jurisdiction, incarcerated at the Federal Correctional Institution at McKean.
Berkmeier has moved to dismiss the complaint on two grounds: the Court lacks personal jurisdiction over him, and the complaint fails to state a claim under the FDCPA. In support of his jurisdictional challenge, Berkmeier has filed an affidavit attesting under oath to the following facts:
Berkmeier owned Encompass Restoration Company and Construction, Inc. d/b/a ERC Construction, a construction company headquartered in Minnesota, until he dissolved the company in February 2013. ECF No. 22-1, ¶¶ 1-2. Some years later, another individual bought the rights to the “ERC” name and used the name to start a new construction company. Id., ¶ 3. “ERC has never been in the business of buying and collecting debts.” Id., ¶ 4. Nor has Berkmeier. Id., ¶ 5. Indeed, the credit report attached to Alexander's complaint associates Diversified Consultants (a company in Jacksonville, Florida) with the $874 collections account at issue. See ECF No. 7, p. 17. Berkmeier has never owned, worked for, or heard of Diversified Consultants. ECF No. 22-1, ¶ 9. Nor had he heard of Alexander before this litigation. Id., ¶ 10. Berkmeier has never worked in Pennsylvania, either personally or in connection with ERC; he has only been to the Commonwealth twice for personal travel; and he has no ties to the Commonwealth. Id., ¶¶ 11-13.
Alexander commenced this action on April 19, 2019, but he has not filed anything or otherwise taken any action to prosecute the case since April 6, 2020. See ECF Nos. 7, 14. During Alexander's two years of inactivity, Berkmeier filed the pending motion to dismiss, a supporting brief, and his affidavit in support of the motion. ECF Nos. 21, 22. The Court ordered Alexander to respond. ECF No. 23. When he failed to do so, the Court issued an order to show cause directing him to respond by December 2, 2021. ECF No. 24. In that order, the Court warned Alexander that “[f]ailure to respond to this Order could result in the dismissal of the Plaintiff's case for failure to prosecute or the Court's consideration of the Motion to Dismiss without the Plaintiff's response.” Id. Most recently, the Court ordered the parties to complete an election form either consenting to the jurisdiction of a United States Magistrate Judge or choosing to have a United States District Judge assigned by February 9, 2022. ECF No. 25. Berkmeier responded, but Alexander did not. The Court's initial response order, show cause order, and the order to complete an election form have been served upon Alexander at his address of record. Alexander has not responded to any of these orders.
Alexander's last docket activity was a motion for default judgment, which the Court denied because, at that time, the Defendant had not been properly served under Federal Rule of Civil Procedure 4. See ECF No. 14.
B. Standard of Decision
Where a defendant moves to dismiss an action for lack of personal jurisdiction pursuant to Rule 12(b)(2), the plaintiff bears the burden to show that the court has personal jurisdiction over the moving defendant. See D'Jamoos ex rel. Estate of Weingeroff v. Pilatus Aircraft Ltd., 566 F.3d 94, 102 (3d Cir. 2009); Gen. Elec. Co. v. Deutz AG, 270 F.3d 144, 150 (3d Cir. 2001). Ultimately, the plaintiff must prove personal jurisdiction by a preponderance of the evidence. Mellon Bank (E.) PSFS, Nat. Ass'n v. Farino, 960 F.2d 1217, 1223 (3d Cir. 1992). But at an early stage of litigation, without an evidentiary hearing on a Rule 12(b)(2) motion, “the plaintiff need only establish a prima facie case of personal jurisdiction.” Miller Yacht Sales, Inc. v. Smith, 384 F.3d 93, 97 (3d Cir. 2004). The plaintiff presents the prima facie existence of personal jurisdiction by “establishing with reasonable particularity sufficient contacts between the defendant and the forum state.” Mellon Bank, 960 F.2d at 1223 (citing Provident Nat. Bank v. California Fed. Sav. & Loan Assoc., 819 F.2d 434 (3d Cir. 1987)).
When a court conducts an evidentiary hearing on personal jurisdiction, then the plaintiff must at that time prove jurisdiction “by a preponderance of the evidence.” Cerciello v. Canale, 563 Fed.Appx. 924, 925 n.1 (3d Cir. 2014) (citation omitted).
Courts reviewing a motion to dismiss for lack of personal jurisdiction under Rule 12(b)(2) conduct a burden-shifting analysis, initially “accept[ing] all of the plaintiff's allegations as true and constru[ing] disputed facts in favor of the plaintiff.” Pinker v. Roche Holdings Ltd., 292 F.3d 361, 368 (3d Cir. 2002) (citing Carteret Sav. Bank, FA v. Shushan, 954 F.2d 141, 142 n.1 (3d Cir. 1992)). If the plaintiff's factual allegations, taken as true, do not establish personal jurisdiction, then a court must grant the motion and dismiss all claims against the defendant. Id.; Knopick v. UBS AG, 2016 WL 7212952, at *1 (M.D. Pa. Apr. 5, 2016) (dismissing claims when allegations “[were] insufficient to withstand any minimum contacts scrutiny that the Court could apply.”). Otherwise, the defendant's motion must include evidence sufficient to challenge personal jurisdiction. If it does, the burden reverts to the plaintiff because, at this point, a Rule 12(b)(2) motion “requires resolution of factual issues outside the pleadings, i.e., whether in personam jurisdiction actually lies.” Time Share Vacation Club v. Atl. Resorts, Ltd., 735 F.2d 61, 66 n.9 (3d Cir. 1984). Now, the plaintiff must support the prima facie existence of personal jurisdiction with “sufficient jurisdictional facts by affidavit, depositions or other competent evidence.” McMullen v. Eur. Adoption Consultants, Inc., 129 F.Supp.2d 805, 810 (W.D. Pa. 2001) (citation omitted). See also Time Share Vacation Club, 735 F.2d at 63, 66, 66 n.9. The plaintiff's reliance “on the bare pleadings alone” is insufficient; the “plaintiff must respond with actual proofs, not mere allegations.” Id. (citing Int'l Ass'n of Machinists & Aerospace Workers v. Northwest Airlines, Inc., 673 F.2d 700, 711-12 (3d Cir. 1982)). Examining the evidence, the court construes any disputed facts supported by competent evidence in the plaintiff's favor. See Carteret Sav. Bank, 954 F.2d at 142 n.1.
“Once the plaintiff has made out a prima facie case in favor of personal jurisdiction, ” the burden shifts back to the defendant one last time to “present a compelling case that the presence of some other considerations would render jurisdiction unreasonable, ” including constitutional requirements of due process. Mellon Bank, 960 F.2d at 1226 (quoting Burger King Corp. v. Rudzewicz, 471 U.S. 462, 477 (1985) (other citation omitted)). See also Gibbs v. Trans Union LLC, 2021 WL 2375898, at *1 (E.D. Pa. June 10, 2021). The constitutional inquiry examines “whether the assertion of personal jurisdiction would comport with ‘fair play and substantial justice.'” Burger King, 471 U.S. at 476 (quoting Int'l Shoe Co. v. Washington, 326 U.S. 310, 320 (1945)).
For these “traditional notions, ” the factors to be considered include “the burden on the defendant, the forum State's interest in adjudicating the dispute, the plaintiff's interest in obtaining convenient and effective relief, the interstate judicial system's interest in obtaining the most efficient resolution of controversies, and the shared interest of the several States in furthering fundamental substantive social policies.” Burger King, 471 U.S. at 477 (quoting WorldWide Volkswagen Corp. v. Woodson, 444 U.S. 286, 292 (1980)).
C. Discussion
1. The Law of Personal Jurisdiction
In determining whether it may exercise personal jurisdiction over a defendant, a federal district court looks first to the long-arm statute of the forum state. Fed.R.Civ.P. 4(k)(1)(A). Pennsylvania's long-arm statute permits the exercise of personal jurisdiction to the fullest extent allowed by the Due Process Clause of the Fourteenth Amendment. See 42 Pa. C.S.A. § 5322; O'Connor v. Sandy Lane Hotel Co., Ltd., 496 F.3d 312, 316 (3d Cir. 2007). This inquiry asks whether the defendant established minimum contacts that have a substantial connection with the forum. Burger King, 471 U.S. at 475 (citing cases); Int'l Shoe, 326 U.S. at 319. Such minimum contacts may be shown under two theories: general jurisdiction or specific jurisdiction. See Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414-15 (1984). A court may exercise general personal jurisdiction only when a defendant is “essentially at home” in the state. See Goodyear Dunlop Tires Operations, S. A. v. Brown, 564 U.S. 915, 919 (2011). “[A]n individual is subject to general jurisdiction in her place of domicile.” Ford Motor Co. v. Montana Eighth Jud. Dist. Ct., __ U.S. __, 141 S.Ct. 1017, 1024 (2021) (citing Daimler AG v. Bauman, 571 U.S. 117, 137 (2014)). “And the ‘equivalent' forums for a corporation are its place of incorporation and principal place of business.” Id. For specific jurisdiction,
[W]e undertake a three-part inquiry. First, the defendant must have purposefully directed [its] activities at the forum. Second, the litigation must arise out of or relate to at least one of those activities. And third, if the first two requirements have been met, a court may consider whether the exercise of jurisdiction otherwise comport[s] with fair play and substantial justice.D'Jamoos, 566 F.3d at 102 (internal quotation marks omitted) (citing Burger King, 471 U.S. at 472, 476; Helicopteros, 466 U.S. at 414; O'Connor, 496 F.3d at 317; Int'l Shoe, 326 U.S. at 320). Courts generally analyze jurisdictional contacts on a claim-by-claim basis (unless the claims overlap factually). See O'Connor, 496 F.3d at 317 n.3.
2. Analysis of Personal Jurisdiction
The Complaint alleges no facts to support the Court's exercise of personal jurisdiction over Berkmeier individually. And even if Alexander's allegations against ERC could be attributed to Berkmeier for purposes of personal jurisdiction, Berkmeier has produced unrebutted evidence showing the absence of personal jurisdiction. He did no business in Pennsylvania at the time of the events alleged in the complaint and does not now. See ECF No. 22-1. He has no association with the company that now operates as “ERC.” The former ERC with which he was associated dissolved in 2013, and the work of that company never took him to Pennsylvania. And he has made only two short, personal visits to the Commonwealth, which are not enough to support hailing him into court here. See Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 774 (1984) (jurisdiction-establishing contacts cannot be “random, isolated, or fortuitous.”).
“Unfortunately, the precedents associated with the exercise of specific jurisdiction are not consistent when it comes to jurisdiction over people sued in their individual capacities for wrongs associated with corporate acts.” Cerciello v. Canale, 563 Fed.Appx. 924, 927 (3d Cir. 2014).
Berkmeier's evidentiary showing reverts the burden to Alexander to support jurisdiction. See McMullen, 129 F.Supp.2d at 810. Alexander has not submitted any evidence to support that Berkmeier has meaningful contacts with Pennsylvania and, therefore, has failed to make a prima facie showing of personal jurisdiction over him. See Piontek v. BB & T Corp., 2010 WL 2349035 (E.D. Pa. June 7, 2010) (dismissing for lack of personal jurisdiction when defendants' affidavits swore to no contacts with forum and plaintiff failed to respond, offering only complaint's allegations). Because Alexander has failed to establish specific personal jurisdiction, it follows that the Court lacks general jurisdiction, which requires even greater contacts. See Kennedy v. Hoegh Autoliners Shipping PTE Ltd., 2021 WL 568121, at *6 n.6 (D.N.J. Feb. 16, 2021) (citations omitted). Without personal jurisdiction over Berkmeier, the Court must grant his motion.
While transfer to a proper judicial district may be appropriate when dismissing an action for lack of personal jurisdiction, a transfer would not serve “the interests of justice.due to the non-responsiveness of Plaintiff and without a strong suggestion as to an appropriate destination venue.” Knopick, 2016 WL 7212952, at *1 (citing 28 U.S.C. § 1404).
3. The Standard for Failure to Prosecute
Alternatively, the Court should dismiss this action for failure to prosecute because all six Poulis factors favor dismissal.
Rule 41(b) states that “if the plaintiff fails to prosecute.. .a defendant may move to dismiss the action.” Fed.R.Civ.P. 41(b). A district court may also dismiss a case pursuant to that Rule for a plaintiff's failure to comply with an order of court. Guyer v. Beard, 907 F.2d 1424, 1429 (3d Cir. 1990). “Under our jurisprudence, the sanction of dismissal is reserved for those cases where the plaintiff has caused delay or engaged in contumacious conduct. Even then, it is also necessary for the district court to consider whether the ends of justice would be better served by a lesser sanction.” Id.
In Poulis v. State Farm Fire and Cas. Co., 747 F.2d 863 (3d Cir. 1984), the United States Court of Appeals for the Third Circuit set out six factors to be weighed when considering whether dismissal of a case as a sanction for failure to obey pretrial orders and participate in discovery was proper: (1) the extent of the party's personal responsibility; (2) the prejudice to the adversary caused by the failure to meet scheduling orders and respond to discovery; (3) a history of dilatoriness; (4) whether the conduct of the party or attorney was willful or in bad faith; (5) the effectiveness of sanctions other than dismissal, which entails an analysis of alternative sanctions; and (6) the meritoriousness of the claim or defense. Id. at 868. These factors must be balanced in determining whether dismissal is an appropriate sanction, although not all need to favor dismissal before dismissal is warranted. Hicks v. Feeney, 850 F.2d 152 (3d Cir. 1988).
There is no “magic formula” for balancing the Poulis factors and not all of the six factors need to be satisfied in order to warrant dismissal. See Karpiel v. Ogg, Cordes, Murphy & Ignelzi, L.L.P., 405 Fed.Appx. 592, 595 (3d Cir. 2010) (citing Mindek v. Rigatti, 964 F.2d 1369, 1373 (3d Cir. 1992) and Ware v. Rodale Press, Inc., 322 F.3d 218, 221 (3d Cir. 2003)). Consideration of these six factors follows.
4. Alexander Has Failed to Prosecute this Action.
(a) The extent of the party's personal responsibility.
Alexander is representing himself in this matter. Thus, he is the party responsible for failing to respond to Defendant's motion to dismiss, despite being twice directed to do so. See, e.g., Williams-Bearden v. Clouser, 2021 WL 4743705, at *2 (M.D. Pa. Oct. 12, 2021). There is no indication that he failed to receive Defendant's motion, the Court's response order, or any of the Court's other orders (including the show cause order and order to file an election form about the jurisdiction of a United States Magistrate Judge). Thus, Plaintiff alone bears full responsibility for any failure in the prosecution of his claims. See, e.g., Briscoe v. Klaus, 538 F.3d 252, 258-59 (3d Cir. 2008) (a pro se plaintiff is personally responsible for the progress of his case and compliance with court orders); Ferguson v. Klock, 2021 WL 1293431, at *2 (E.D. Pa. Apr. 7, 2021).
(b) Prejudice to the adversary.
The second Poulis factor, the prejudice to the Defendant caused by Alexander's failure to respond to Defendant's motion to dismiss, also supports dismissal. A finding of prejudice does not require “irremediable harm.” Adams v. Trustees of N.J. Brewery Emps.' Pension Trust Fund, 29 F.3d 863, 874 (3d Cir. 1994). Instead, “the burden imposed by impeding a party's ability to [effectively prepare] a full and complete trial strategy is sufficiently prejudicial.” Ware, 322 F.3d at 222. Alexander's failure to litigate this case by responding to Berkmeier's motion to dismiss, along with his failure to comply with this Court's show cause order requiring him to do so, frustrates and delays the resolution of this matter. This failure prejudices the Defendant, who seeks a timely resolution of this case. See e.g., Parks v. Argueta, 2016 WL 7856413, at *4 (M.D. Pa. Dec. 5, 2016) (dismissing case when a pro se litigant failed to respond to a pending motion for summary judgment).
(c) A history of dilatoriness.
The level of inattention Alexander has displayed toward this litigation is sufficient evidence, in the Court's view, to indicate that he does not intend to timely proceed with this case. “‘[F]ailure to prosecute' under the Rule 41(b) does not mean that the plaintiff must have taken any positive steps to delay the trial.. ..It is quite sufficient if he does nothing.” Adams v. Trs. of the N.J. Brewery Emps.' Pension Tr. Fund, 29 F.3d 863, 874 (3d Cir. 1994). When considering an extensive delay, “a party's problematic acts must be evaluated in light of its behavior over the life of the case.” Id. Alexander has missed several court-mandated deadlines and violated multiple Court orders. Almost two years have passed since he filed anything in this case. ECF No. 14. See Hildebrand v. Alleghey Cty., 923 F.3d 128, 134-35 (3d Cir. 2019) (“three-year hiatus in five and a half years of litigation” can favor dismissal if plaintiff has not responsibly litigated before the delay). Alexander's protracted inattention and delay favor dismissal.
(d) Whether the party's conduct was willful or in bad faith.
There is no indication on this record that Plaintiff's failures resulted from any “excusable neglect, ” Poulis, supra, and it appears that his failures to respond and actively pursue his case are willful. Thus, the Court should conclude that his actions were an intentional disregard of his own case and our orders. This factor also weighs in favor of dismissal.
(e) Alternative sanctions.
Imposition of costs or fees upon Alexander would likely be ineffective as a sanction since he is representing himself and thus has no attorney upon whom the Court could impose sanctions or expenses for ignoring the Court's prior orders. See Emerson v. Thiel Coll., 296 F.3d 184, 191 (3d Cir. 2002). His utter lack of participation has potentially caused the loss of witness' memories or other evidence. Dismissal is the most effective sanction under the particular facts and circumstances of this case.
(f) Meritoriousness of Plaintiff's case.
Alexander's claims are frivolous. For this factor, “[a] claim, or defense will be deemed meritorious when the allegations of the pleadings, if established at trial, would support recovery by plaintiff or would constitute a complete defense.” Poulis, 747 F.2d at 869-70 (citing United States v. $55,518.05 in U.S. Currency, 728 F.2d 192, 195 (3d Cir. 1984)). First, Berkmeier is not a “debt collector” under 15 U.S.C. § 1692(a)(6) of the FDCPA. See Henson v. Santander Consumer USA Inc., __ U.S. __, 137 S.Ct. 1718, 1721 (2017). Second, the allegations of the complaint do not support a plausible inference that Berkmeier has or had any association with the “ERC” Alexander alleges reported his debt to credit agencies. Berkmeier has produced unrebutted evidence that he had no such association and that, in any event, it was Diversified Consultants that held the assignment of his delinquent Comcast account. See ECF No. 22-1; ECF No. 7, p. 17. Under these facts, Alexander cannot support a claim under the FDCPA. See D'Onofrio v. Il Mattino, 430 F.Supp.2d 431, 444 (E.D. Pa. 2006) (“questionable” merits of plaintiff's case supported sua sponte dismissal for failure to prosecute).
D. Conclusion
For the foregoing reasons, it is recommended that the Court grant Defendant's motion to dismiss (ECF No. 21) because the Court lacks personal jurisdiction over Berkmeier and Alexander has failed to prosecute the action. Leave to amend should be denied because amendment would be futile. See Grayson v. Mayview State Hosp., 293 F.3d 103, 108 (3d Cir. 2002).
III. Notice
In accordance with the applicable provisions of the Magistrate Judges Act, 28 U.S.C. § 636(b)(1)(B) & (C), and Rule 72.D.2 of the Local Rules of Court, the parties shall have fourteen (14) days from the date of the service of this Report and Recommendation to file written objections thereto. Plaintiff's failure to file timely objections may constitute a waiver of his appellate rights.