Filed: Aug. 17, 2020
Latest Update: Aug. 17, 2020
Summary: Case: 19-12640 Date Filed: 08/17/2020 Page: 1 of 12 [DO NOT PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT _ No. 19-12640 Non-Argument Calendar _ D.C. Docket No. 1:19-cv-01551-MHC DANIEL ANTHONY DIULUS, LINDA DIULUS, Plaintiffs-Appellants, versus AMERICAN EXPRESS TRAVEL RELATED SERVICES COMPANY, INC., THE PALMS RESORT TURKS & CAICOS LTD, Defendants-Appellees. _ Appeal from the United States District Court for the Northern District of Georgia _ (August 17, 2020) Before WI
Summary: Case: 19-12640 Date Filed: 08/17/2020 Page: 1 of 12 [DO NOT PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT _ No. 19-12640 Non-Argument Calendar _ D.C. Docket No. 1:19-cv-01551-MHC DANIEL ANTHONY DIULUS, LINDA DIULUS, Plaintiffs-Appellants, versus AMERICAN EXPRESS TRAVEL RELATED SERVICES COMPANY, INC., THE PALMS RESORT TURKS & CAICOS LTD, Defendants-Appellees. _ Appeal from the United States District Court for the Northern District of Georgia _ (August 17, 2020) Before WIL..
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Case: 19-12640 Date Filed: 08/17/2020 Page: 1 of 12
[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 19-12640
Non-Argument Calendar
________________________
D.C. Docket No. 1:19-cv-01551-MHC
DANIEL ANTHONY DIULUS,
LINDA DIULUS,
Plaintiffs-Appellants,
versus
AMERICAN EXPRESS TRAVEL RELATED SERVICES COMPANY, INC.,
THE PALMS RESORT TURKS & CAICOS LTD,
Defendants-Appellees.
________________________
Appeal from the United States District Court
for the Northern District of Georgia
________________________
(August 17, 2020)
Before WILSON, LUCK, and ANDERSON, Circuit Judges.
PER CURIAM:
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The Diuluses challenge the district court’s order dismissing their suit against
American Express Travel for failure to state a claim and their suit against The Palms
Resort for lack of personal jurisdiction. We affirm.
FACTUAL BACKGROUND AND PROCEDURAL HISTORY
While staying at Palms’s resort in the Turks and Caicos Islands south of the
Bahamas, Daniel Diulus won some money at an island casino. He returned to Palms
with his winnings and, outside the resort’s lobby, he was stabbed, shot, and robbed.
According to the complaint, the attack left him with “a collapsed lung, extensive
deep tissue loss of left thigh, a massive hemorrhage and invasive surgery.”
The Diuluses alleged in their complaint that “The Palms Resort invited [them]
to stay at its resort via its agent,” Amex Travel. They alleged that Palms had
breached its duty “by failing to exercise ordinary care to keep their premises safe”
and that Amex Travel “had a duty to make safe, or warn guests” that the resort was
not safe, but it failed to do so.1
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In their complaint, the Diuluses provided a long list of ways in which both Amex Travel
and Palms were negligent:
Defendants were negligent and said negligence proximately caused Plaintiffs’
injuries in the following ways, to-wit:
a) Violation of O.C.G.A. § 51-3-1 by failing to use ordinary care to keep the
premises safe;
b) Violation of O.C.G.A. § 44-7-13;
c) In failing to properly inspect and maintain the premises;
d) In failing to warn of the latent dangers on the premises;
e) In failing to properly train and supervise employees in regard to the
maintenance and safety of said premises;
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Palms filed a motion to dismiss for lack of personal jurisdiction. In the
motion, Palms alleged that the Diuluses failed to make a prima facie case that the
court had personal jurisdiction because the Diuluses alleged neither that jurisdiction
was appropriate under Georgia’s long-arm statute nor that Palms had sufficient
minimum contacts with Georgia such that jurisdiction could be proper under the Due
Process Clause.
Amex Travel also filed a motion to dismiss, arguing that the Diuluses failed
to state a claim for relief. Amex Travel argued that “the bare allegation that
American Express is a ‘travel agent’ does not give rise to a theory of liability.”
Amex Travel argued that the Diuluses’ claim was one of premises liability, and
because Amex Travel “at no time owned, operated, or managed the property,” it
could not be held liable on such a theory.
The district court granted both motions to dismiss. As to Palms’s motion, the
court applied Georgia’s long-arm statute and determined that “it cannot fairly be said
that [Palms has] performed any act or transaction related to this case that would
amount to the ‘transaction of business’ in Georgia.” The court observed that the
complaint alleged neither that the Diuluses “visited or used Palms’s website in
f) In failing in properly retaining, entrusting, hiring, training and supervising said
employees;
g) In failing to inspect, patrol, or appropriately monitor the premises; and
h) In failing to employ proper security measures in light of the history of the
property and high-crime area in which the property is located.
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electing to go to the resort or to pay for the services” nor “that Palms exhibited an
intent to reach out to [the Diuluses] or persons living in Georgia.”
The court also denied what it construed as the Diuluses’ “request for leave to
take jurisdictional discovery.” The court found that the Diuluses had failed to
establish a prima facie case of personal jurisdiction over Palms. The court also found
that the Diuluses made “no allegation that Palms conducted any business in Georgia
related to activity that forms the factual predicate of this case.” The court declined
to grant the request to take jurisdictional discovery in the absence of any alleged
facts that could “support specific personal jurisdiction over Palms.”
As to Amex Travel’s motion to dismiss, the court granted the motion because
it found that the Diuluses failed to assert a cognizable claim against Amex Travel.
The Diuluses asserted two claims against Amex Travel, one based on premises
liability and the other on negligence. Because the Diuluses made no allegation that
Amex Travel “had possession or exercised any control over the premises in
question,” their complaint failed to support a cause of action based on premises
liability against Amex Travel. Nor did it establish any legal duty for Amex Travel
to warn the Diuluses that they could be robbed if they vacationed at Palms.
The Diuluses appealed.
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STANDARDS OF REVIEW
We review the district court’s ruling on a motion to dismiss de novo. See Am.
Dental Ass’n v. Cigna Corp., 605 F.3d 1283, 1288 (11th Cir. 2010) (reviewing de
novo a motion to dismiss for failure to state a claim); Cable/Home Commc’n Corp.
v. Network Prods., Inc.,
902 F.2d 829, 855 (11th Cir. 1990) (reviewing de novo a
motion to dismiss for lack of personal jurisdiction). And we review the district
court’s decisions not to take judicial notice and to deny jurisdictional discovery for
abuse of discretion. Paez v. Sec’y, Fla. Dep’t of Corr.,
947 F.3d 649, 651 (11th Cir.
2020) (reviewing for abuse of discretion “a district court’s decision to take judicial
notice of a fact”); United Techs. Corp. v. Mazer,
556 F.3d 1260, 1280 (11th Cir.
2009) (reviewing for abuse of discretion the denial of jurisdictional discovery).
DISCUSSION
The Diuluses contend that the district court erred in three ways: (1) by
dismissing their claim against Amex Travel for failure to state a valid claim, (2) by
dismissing their claim against Palms for lack of personal jurisdiction, and (3) by
denying their request for jurisdictional discovery.
Amex Travel
The Diuluses argue that the district court erred when it granted Amex Travel’s
motion to dismiss for failure to state a claim because (a) the district court applied the
law for premises liability, rather than for failure to warn; (b) the district court failed
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to recognize that, as a travel agent, Amex Travel owed a duty of care to the Diuluses;
(c) the district court erred by dismissing the case before the Diuluses could conduct
discovery; and (d) the district court erred by failing to take judicial notice of online
information concerning “recent attacks against American tourists in foreign locales.”
As to the Diuluses’ argument that the district court applied premises liability
law rather than the law for failure to warn, the district court did not err when it
applied premises liability law because the Diuluses’ complaint alleged in part that
Amex Travel and Palms violated Georgia’s premises liability law “by failing to use
ordinary care to keep the premises safe.” But the district court also applied the law
for failure to warn when it found “no legal duty that American Express owed to [the
Diuluses] to warn them of or to protect them from the hazard or dangerous condition
that is alleged to have caused Daniel Diulus’s injuries.”
As to the Diuluses’ argument that it was error to conclude that Amex Travel
owed no duty of care as their travel agent, the complaint failed to allege that Amex
Travel was their travel agent. The complaint alleged only that Amex Travel was
acting as Palms’s agent. Thus, even if Georgia law recognized a duty that a travel
agent had to warn its client of hazards on an upcoming trip—and the Diuluses
acknowledged in their brief that the “law regarding travel agents as fiduciary agents
is still developing” and such a duty is very much in dispute, see, e.g., Lavine v. Gen.
Mills, Inc., 519 F. Supp. 332, 335 (N.D. Ga. 1981) (concluding, under Georgia law,
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that travel agent had “no duty . . . to warn [plaintiff] of or to protect her from the
hazard that caused her injury”)—the Diuluses did not allege that Amex Travel was
their agent or that Amex Travel had an agent-client relationship with them.
As to the Diuluses’ argument that the district court erred when it granted the
motion to dismiss while discovery was ongoing, because their complaint failed to
state a claim, they were not entitled to discovery. See Ashcroft v. Iqbal, 556 U.S.
662, 686 (2009) (“Because respondent’s complaint is deficient under Rule 8, he is
not entitled to discovery, cabined or otherwise.”). This court has held that a district
court should resolve a motion to dismiss before allowing discovery:
Facial challenges to the legal sufficiency of a claim or defense, such as
a motion to dismiss based on failure to state a claim for relief, should
. . . be resolved before discovery begins. Such a dispute always
presents a purely legal question; there are no issues of fact because the
allegations contained in the pleading are presumed to be true.
Therefore, neither the parties nor the court have any need for discovery
before the court rules on the motion.
Chudasama v. Mazda Motor Corp., 123 F.3d 1353, 1367 (11th Cir. 1997) (footnote
and citations omitted).
Finally, as to the Diuluses’ argument that the district court failed to take
judicial notice of online news articles concerning attacks against American tourists
on the island, we find no abuse of discretion. The Diuluses did not request that the
district court take judicial notice of the online news articles, and a court cannot abuse
discretion it was not asked to exercise.
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Palms
The Diuluses also appeal the district court’s order dismissing their complaint
against Palms for lack of personal jurisdiction. They argue that we should reverse
because the district court wrongly concluded that they did not allege a prima facie
case for personal jurisdiction against Palms, the court disregarded evidence attached
to and referenced in their response to the dismissal motion, and it abused its
discretion in denying their request for jurisdictional discovery.
Where, as here, a defendant moves to dismiss a complaint for lack of personal
jurisdiction, the court analyzes the claim under a three-step burden-shifting process.
First, the plaintiff “bears the initial burden of alleging in the complaint sufficient
facts to make out a prima facie case of jurisdiction.” Mazer, 556 F.3d at 1274.
Second, if the complaint alleged sufficient facts, and “the defendant challenges
jurisdiction by submitting affidavit evidence in support of its position, the burden
traditionally shifts back to the plaintiff to produce evidence supporting jurisdiction.”
Id. (quotation marks omitted). Third, “[w]here the plaintiff’s complaint and
supporting evidence conflict with the defendant’s affidavits, the court must construe
all reasonable inferences in favor of the plaintiff.” Diamond Crystal Brands, Inc. v.
Food Movers Int’l, Inc.,
593 F.3d 1249, 1257 (11th Cir. 2010).
“A federal court sitting in diversity undertakes a two-step inquiry in
determining whether personal jurisdiction exists: the exercise of jurisdiction must
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(1) be appropriate under the state long-arm statute and (2) not violate the Due
Process Clause of the Fourteenth Amendment to the United States Constitution.” Id.
at 1257–58. Here, the district court dismissed the Diuleses’ complaint because it
failed to allege facts sufficient for a court to exercise jurisdiction under Georgia’s
long-arm statute.
The Georgia long-arm statute provides as follows:
A court of this state may exercise personal jurisdiction over any
nonresident or his or her executor or administrator, as to a cause of
action arising from any of the acts, omissions, ownership, use, or
possession enumerated in this Code section, in the same manner as if
he or she were a resident of this state, if in person or through an agent,
he or she:
(1) Transacts any business within this state;
....
(3) Commits a tortious injury in this state caused by an act or omission
outside this state if the tort-feasor regularly does or solicits business, or
engages in any other persistent course of conduct, or derives substantial
revenue from goods used or consumed or services rendered in this state
....
O.C.G.A. § 9-10-91(1) & (3).
The Diuluses contend that their complaint alleged that Palms transacted
business within Georgia and regularly conducted business in the state. We disagree.
The complaint alleged that Palms: (1) was owned, operated, controlled, and
managed in the Turks and Caicos; (2) invited guests to the Turks and Caicos; (3)
invited the Diuluses to stay on March 3, 2017; (4) knew about the crime problem in
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the Turks and Caicos but failed to warn the Diuluses and failed to maintain their
property and train their staff; and (5) negligently represented that its property was
safe.
Missing is any allegation that Palms transacted business in the state arising
out of the cause of action or regularly conducted business in Georgia. The resort
was in the Turks and Caicos. The negligent acts—failing to maintain the property
and hiring and training staff—all took place in that country. And the complaint did
not allege that the invitations sent to guests were sent to Georgia residents.
As to the Diuleses, the complaint alleged that, “[o]n or around March 3, 2017,
Defendant The Palms Resort invited Plaintiffs to stay at its resort via its agent,
Defendant American Express Travel Related Services Company, Inc.” The Diuleses
did not allege that they were Georgia residents or in Georgia when they received the
invitation. The complaint alleged that “[o]n or about March 4, 2017”—the day after
the Diuluses received the invitation—“Plaintiffs resided in Georgia.” According to
the complaint, the Diuluses became Georgia residents only after they received the
invitation from Palms through Amex Travel.
The Diuluses argue that, even if their complaint was deficient, the district
court should have looked to their affidavit attached to, and documents referenced in,
their response to the motion to dismiss. These attachments, they say, show that
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Palms transacted business in Georgia arising out of this cause of action and regularly
conducted business in the state.
But the Diuluses misunderstand the three-step burden-shifting process for
evaluating a dismissal motion for lack of personal jurisdiction. Once the defendant
files a motion to dismiss, the plaintiff “bears the initial burden of alleging in the
complaint sufficient facts to make out a prima facie case of jurisdiction.” Mazer,
556 F.3d at 1274. If the plaintiff doesn’t meet his burden, the district court doesn’t
go to the second and third steps of the burden-shifting process, and the motion should
be granted. The court will look to the plaintiff’s affidavits and other discovery only
if (1) the complaint alleged sufficient facts to make out a prima facie case of personal
jurisdiction, and (2) “the defendant challenges jurisdiction by submitting affidavit
evidence in support of its position.”
Id.
Here, Palms’s motion to dismiss argued only that the complaint did not allege
a prima facie case of personal jurisdiction. The resort’s motion did not rely on any
affidavits or attach additional documents; it only attacked the Diuluses’ complaint.
The district court properly reviewed the allegations in the complaint, found them to
be deficient, and dismissed the complaint. There was no reason for the district court
to look elsewhere after the Diuluses failed to allege a prima facie case of personal
jurisdiction.
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In any event, the documents the Diuluses rely on to establish jurisdiction
under Georgia’s long-arm statute—a printout of Palms’s website listing Atlanta as
one of eleven cities with direct flights to Turks and Caicos and a document from
Georgia’s corporations division identifying Amex Travel as a registered foreign
corporation—are insufficient. The documents establish neither that Palms
transacted business in the state arising out of this cause of action nor that the hotel
regularly conducted business in the state.
Finally, the Diuluses argue that, even if they did not allege a prima facie case
and even if their attachments are deficient, they should have been allowed
jurisdictional discovery. The district court erred, they say, by ruling without giving
them the chance to prove personal jurisdiction. But, as we’ve explained, a district
court does not abuse its discretion by denying jurisdictional discovery if “the
complaint was insufficient as a matter of law to establish a prima facie case that the
district court had jurisdiction.” Butler v. Sukhoi Co., 579 F.3d 1307, 1314 (11th Cir.
2009). Because the Diuluses did not meet their initial burden to allege a prima facie
case of personal jurisdiction, we cannot say it was an abuse of the district court’s
discretion to deny them jurisdictional discovery.
AFFIRMED.
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