ROBERT J. CONRAD, Jr., District Judge.
Plaintiff voluntarily dismissed with prejudice all claims against defendant Scott Paul ("Mr. Paul") on September 1, 2015, (Doc. No. 99), and all previously pending motions by Mr. Paul have been terminated, (Doc. Nos. 28, 29, 47). Therefore, to the extent the Magistrate Judge's two M&R's addressed motions by Mr. Paul, the Court finds that such recommendations are moot and will forego any discussion of those issues herein.
Plaintiff has objected to the Magistrate Judge's findings of fact. The Court conducted a thorough review of the facts in this case as well as the Magistrate Judge's analysis of those facts. The Court finds, in all respects, the facts as stated in the M&R to be in accordance with the pleadings and should be adopted. The Court adds only the following for clarification.
Plaintiff alleges that Zhang contacted Plaintiff in North Carolina via email, phone, and/or mail somewhere between eight and eleven times.
Between May 2010 and September 2011, Plaintiff entered into six contracts with Hoku Materials, Inc., which is not a defendant in this matter. (Doc. No. 37 at 18-21). No defendant in this case was a party to these contracts. (Doc. No. 98 at 20). Plaintiff alleges that it performed much of the project management, engineering, and project support services for these contracts from its main offices in North Carolina and that it shipped company owned equipment and purchased and shipped materials from North Carolina to Idaho. (
Neither party has objected to the Magistrate Judge's statement of the procedural background of this case; therefore, the Court adopts the procedural facts as set forth in the M&R. The Court adds only the following in order to account for the procedural history of the case since the July 2015 M&R. On July 30, 2015, Plaintiff requested an extension of time to serve its objections to the M&R, (Doc. No. 96), and the Court granted Plaintiff an extension to August 16, 2015, (Doc. No. 97). Plaintiff filed its Objections to the M&R on August 17, 2015. (Doc. No. 98).
All claims against Mr. Paul were voluntarily dismissed with prejudice on September 1, 2015, (Doc. No. 99), and all previously pending motions by Mr. Paul have been terminated, (Doc. Nos. 28, 29, 47).
A district court may assign dispositive pretrial matters, including motions to dismiss, to a magistrate judge for "proposed findings of fact and recommendations." 28 U.S.C. § 636(b)(1)(A) & (B). The Federal Magistrate Act provides that a district court "shall make a de novo determination of those portions of the report or specified proposed findings or recommendations to which objection is made."
Under Rule 72(b) of the Federal Rules of Civil Procedure, a district court judge shall make a de novo determination of any portion of an M&R to which specific written objection has been made. No objection to the January 2015 M&R, (Doc. No. 40), having been filed, the parties have waived their right to de novo review of any issue covered in that M&R. Nevertheless, this Court has conducted a full and careful review of the January 2015 M&R and other documents of record. Plaintiff's First Amended Complaint, (Doc. No. 37), was timely filed. It is well settled that a timely-filed amended pleading supersedes the original pleading, and motions directed at superseded pleadings are thereby rendered moot.
As to the July 2015 M&R, Plaintiff enumerates ten objections. Specifically, Plaintiff has challenged the M&R for: (1) failing to consider all the relevant facts of the record; (2) improperly applying the fiduciary shield doctrine; (3) incorrectly determining that the Court does not have personal jurisdiction over Zhang; (4) criticizing Plaintiff for not conducting a specific analysis of personal jurisdiction under North Carolina's long arm statute; (5) incorrectly determining that the Court cannot exercise personal jurisdiction over Liu; (6) relying on a forum selection clause to determine whether the Court has personal jurisdiction over the defendants; (7) incorrectly concluding that the Court does not have personal jurisdiction over Tianwei; (8) recommending that Plaintiff's Motion for Leave to File Amended Complaint be denied as moot; (9) failing to deny the defendants' Motions to Dismiss under Rule 12(b)(6); and (10) recommending that the case be dismissed instead of transferred to Idaho. The Court addresses each objection in turn.
Plaintiff contends that the M&R "completely ignored relevant facts" and erroneously determined that this Court does not have personal jurisdiction over any of the defendants. (Doc. No. 98 at 2). Specifically, Plaintiff objects to the M&R's analysis of the defendants' contacts with North Carolina and its determination that the defendants did not have sufficient contacts to subject them to personal jurisdiction in North Carolina.
Plaintiff bears the burden of establishing personal jurisdiction by a preponderance of the evidence.
The M&R, after a thorough and careful analysis of all relevant facts, determines that Plaintiff has failed to meet its burden to show that any of the defendants directed activities toward North Carolina such that they purposefully availed themselves of the privilege of conducting activities within the State. It thus concludes that the Court lacks personal jurisdiction over any defendant in this case and recommends that all Plaintiff's claims be dismissed. Plaintiff devotes much argument to refuting this recommendation. However, a handful of phone calls and emails with Plaintiff do not create the substantial contacts necessary for this Court to exercise personal jurisdiction over the defendants.
The Court has considered Plaintiff's arguments, reviewed the record, and evaluated the M&R. The M&R correctly states the law and properly applies the relevant facts of the case to the law. This Court finds no error in the Magistrate Judge's analysis or conclusions regarding the Court's lack of personal jurisdiction. Therefore, the Court overrules Plaintiff's first, third, fifth, and seventh objections and finds that this Court lacks personal jurisdiction over any defendant in this matter.
Plaintiff argues that the Magistrate Judge improperly applied the fiduciary shield doctrine and incorrectly relied upon a forum selection clause to determine that the Court does not have personal jurisdiction over Zhang and Liu. Plaintiff does little to advance these arguments, and the Court finds them to be conclusory objections which do not warrant de novo review. Nevertheless, the Court has reviewed and considered the arguments and has determined they lack merit. A finding of lack of personal jurisdiction in this case does not rely on the fiduciary shield doctrine or any principal therein. Likewise, while the M&R mentions a forum selection clause in a
Plaintiff next summarily alleges that the Magistrate Judge criticized Plaintiff for "fail[ing] to meet its burden by not specifically analyzing personal jurisdiction under the statutory construction of North Carolina's long arm statute." (Doc. No. 98 at 14). Plaintiff then recapitulates the law surrounding personal jurisdiction in North Carolina and reasserts its arguments that Zhang is subject to personal jurisdiction in North Carolina due to his "specific contacts" with Plaintiff and "his torts occurring in North Carolina." (
Plaintiff next objects to the M&R's recommendation that Plaintiff's Motion for Leave to File Amended Complaint, (Doc. No. 55), be dismissed as moot and its failure to address and deny the portions of the defendants' Motions to Dismiss made pursuant to Rule 12(b)(6), (Doc. Nos. 49, 92). Plaintiff's proposed amendment, which seeks to add an additional claim under North Carolina's Unfair and Deceptive Trade Practices Act, offers no additional basis for this Court to exercise personal jurisdiction over the defendants. Having found personal jurisdiction wanting, Plaintiff's Motion is moot. Furthermore, allowing Plaintiff to add a claim to a jurisdictionally deficient complaint would be futile.
Similarly, the Court lacks the authority to examine the substance of Defendants' Motions to Dismiss pursuant to Rule 12(b)(6). The Supreme Court has found personal jurisdiction to be an essential element of the jurisdiction of a district court, without which the court is "powerless to proceed to an adjudication."
Finally, Plaintiff objects to the Magistrate's recommendation that the case be dismissed rather than transferred. Plaintiff contends, in the alternative to its argument for personal jurisdiction in North Carolina, that this case should be transferred to the District of Idaho pursuant to 28 U.S.C. § 1406(a). When a case is filed in an improper venue, as the case was here, section 1406(a) instructs the district court to dismiss or, where it is in the interest of justice, transfer the matter to the proper venue. The test, therefore, under section 1406(a) is whether a transfer is in the interest of justice.
The Court finds that Plaintiff has not satisfied its burden to prove that a transfer is in the interest of justice. In fact, Plaintiff has failed to even address the interest of justice. The only argument Plaintiff offers to support a transfer is the statement that transferring the case "would maintain the filing date of the complaint and thereby avoid any statute of limitations issues." (Doc. No. 98 at 24). However, Plaintiff does not explain or argue that any of its claims would actually be time-barred if refiled in Idaho. Section 1406 was enacted to avoid injustice when a plaintiff made "an erroneous guess with regard to the existence of some elusive fact" and filed the claim in a district that lacked jurisdiction.
For the foregoing reasons, the Court overrules all of Plaintiff's objections to the M&R and finds that this Court lacks personal jurisdiction over the defendants and dismissal of the case is warranted. Accordingly, the Court