United States District Court, N.D. Alabama, Western Division
DEREK L. HAND and ASHLEY N. HAND, Plaintiffs,
WHOLESALE AUTO SHOP, LLC, Defendants.
MEMORANDUM OF OPINION
SCOTT COOGLER UNITED STATES DISTRICT JUDGE
the Court is Plaintiffs Derek L. Hand (“Mr.
Hand”) and Ashley N. Hand (“Mrs. Hand”)
(collectively the “Hands”)'s Motion for
Default Judgment as well as their Memorandum Regarding
Personal Jurisdiction. (Docs. 17 & 19.) Both issues have
been adequately briefed and are ripe for adjudication. For
the following reasons, the Hands' Motion for Default
Judgment is due to be DENIED for lack of personal
Hands are Alabama residents. Defendant Wholesale Auto Shop,
LLC (“Wholesale Auto”) is a Tennessee corporation
whose principal place of business is in Tennessee. In early
2014, Wholesale Auto listed a 2010 Jeep Wrangler Sport SUV 2D
(the “Jeep”) with 66, 692 miles on the website
www.autotrader.com. Mr. Hand saw the listing and
through the website requested Wholesale Auto to call him
about the Jeep on his Alabama telephone number. Mr. Hand and
Wholesale Auto spoke on the phone three times, and Wholesale
Auto dialed Mr. Hand for at least two of those three calls.
Additionally, Wholesale Auto faxed basic information about
the Jeep to Mr. Hand at his request to his local Brookwood,
Alabama fax number so that he could acquire financing for its
purchase through Wells Fargo.
their interactions, Mr. Hand asked Wholesale Auto if the
Jeep's mileage was correct as its price was lower than he
expected. Wholesale Auto claimed that the mileage was
accurate and that Wholesale Auto was able to provide a low
price because it had a good relationship with a local bank
who had recently recovered the vehicle. At no point did
Wholesale Auto ever communicate to Mr. Hand that there was a
discrepancy between the advertised mileage and the Jeep's
actual mileage. In one of the three calls, Mr. Hand agreed to
pay Wholesale Auto's asking price for the Jeep. The Hands
then drove to Chattanooga, Tennessee where they purchased the
Jeep and took possession of it.
the Hands purchased the Jeep, the odometer read 66, 692
miles, which Wholesale Auto affirmed as accurate. When they
sought to register the Jeep in Alabama, however, the Hands
learned that the Jeep's true mileage at the time of
purchase was 253, 603. They then filed this action on October
20, 2015, alleging violations of the Motor Vehicle
Information and Cost Savings Act, 49 U.S.C.A. § 32710(b)
(2012), the Alabama Deceptive Trade Practices Act, and
state-law claims. On December 9, 2015, the Court received a
letter from Melissa Williams, the owner of Wholesale Auto,
purportedly on its behalf. The Court did not treat the letter
as an answer on behalf of Wholesale Auto, however, because
Wholesale Auto is a corporation, and Ms. Williams is not an
attorney. (See Doc. 12.) After no appearance or
answer on behalf of Wholesale Auto, the Hands filed a motion
for default judgment on May 31, 2017. Because the Court
doubted the existence of personal jurisdiction over Wholesale
Auto in Alabama, it asked the Hands during a July 5, 2017
telephone conference to prepare a supplemental brief
addressing that issue, which they submitted on August 3,
may raise the question of personal jurisdiction sua
sponte when deciding whether to enter a default judgment
when the defendant has failed to appear, provided the Court
grants the parties the chance to argue why personal
jurisdiction exists. Lipofsky v. N.Y. State Workers Comp.
Bd., 861 F.2d 1257, 1258 (11th Cir. 1988) (“In the
absence of a waiver, a district court may raise on its own
motion an issue of defective venue or lack of personal
jurisdiction; but the court may not dismiss without first
giving the parties an opportunity to present their views on
the issue.”); see also Sys. Pipe & Supply, Inc.
v. M/V Viktor Kurnatovskiy, 242 F.3d 322, 324 (5th Cir.
2001) (no error by district court to raise lack of personal
jurisdiction sua sponte upon plaintiff's motion
for default judgment); Smarter Every Day, LLC v.
Nunez, No. 2:15-CV-01358-RDP, 2017 WL 1247500, at *2
(N.D. Ala. Apr. 5, 2017) (raising lack of personal
jurisdiction sua sponte upon plaintiff's motion
for default judgement); Turi v. Stacey, No.
5:13-CV-248-OC-22PRL, 2015 WL 403228, at *3 (M.D. Fla. Jan.
28, 2015), aff'd, 627 F. App'x 904 (11th
Cir. 2015) (same). Because a “defendant may defeat
subsequent enforcement of a default judgment in another forum
by demonstrating that the judgment issued from a court
lacking personal jurisdiction, ” Rash v. Rash,
173 F.3d 1376, 1381 (11th Cir. 1999), raising the issue of
personal jurisdiction at the default-judgment stage
ultimately conserves judicial resources. The Court has
provided the Hands an opportunity to show how personal
jurisdiction exists in this case and they have presented
their arguments for why this action is properly before the
Court. (See Doc. 19.)
federal district court sitting in diversity may exercise
personal jurisdiction to the extent authorized by the law of
the state in which it sits and to the extent allowed under
the Constitution.” Meier ex rel. Meier v. Sun
Int'l Hotels, Ltd., 288 F.3d 1264, 1269 (11th Cir.
2002); see also Daimler AG v. Bauman, 134 S.Ct. 746,
753 (2014) (“Federal courts ordinarily follow state law
in determining the bounds of their jurisdiction over
persons.”). A district court may exercise personal
jurisdiction over a defendant when two conditions are met.
First, jurisdiction must be proper under the forum
state's long-arm statute. Sloss Indus. Corp. v.
Eurisol, 488 F.3d 922, 925 (11th Cir. 2007). Second,
exercising jurisdiction must not violate the defendant's
rights under the Due Process Clause of the Fourteenth
Amendment, which requires that the defendant have sufficient
“minimum contacts” with the forum state so as not
to offend “traditional notions of fair play and
justice.” Id. (citations omitted). In Alabama,
“the two inquiries merge, because Alabama's
long-arm statute permits the exercise of personal
jurisdiction to the fullest extent constitutionally
permissible.” Id. Thus, the Court need only
consider the limits of the Due Process Clause. Mut. Serv.
Ins. Co. v. Frit Indus., Inc., 358 F.3d 1312, 1319 (11th
are two types of personal jurisdiction, general and specific;
the Hands do not argue that general jurisdiction exists over
Wholesale Auto. (Doc. 19 at 7 (“[P]laintiffs make no
argument here concerning whether the Court can or cannot
assert general in personam jurisdiction over the
defendant.”).) Instead, the Hands state that specific
jurisdiction exists over Wholesale Auto in Alabama.
a forum seeks to assert specific personal jurisdiction over a
nonresident defendant, due process requires the defendant
have ‘fair warning' that a particular activity may
subject him to the jurisdiction of a foreign
sovereign.” Madara v. Hall, 916 F.2d 1510,
1516 (11th Cir. 1990). The inquiry whether a forum State may
assert specific jurisdiction over a nonresident defendant
focuses on “the relationship among the defendant, the
forum, and the litigation.” Keeton v. Hustler
Magazine, Inc., 465 U.S. 770, 775 (1984) (quoting
Shaffer v. Heitner, 433 U.S. 186, 204 (1977)). For a
state to exercise jurisdiction consistent with due process,
the defendant's suit-related conduct must create
a substantial connection with the forum state. Walden v.
Fiore, 134 S.Ct. 1115, 1121 (2014). The contacts with
the forum state must also be purposeful and created by the
“defendant himself.” Id. at
1122 (“We have consistently rejected attempts to
satisfy the defendant-focused ‘minimum contacts'
inquiry by demonstrating contacts between the plaintiff (or
third parties) and the forum State.”). Due process
requires that a defendant be subjected to specific
jurisdiction of a State “based on his own affiliation
with the State, not based on the ‘random, fortuitous,
or attenuated' contacts he makes by interacting with
other persons affiliated with the State.” Id.
at 1123 (quoting Burger King Corp. v. Rudzewicz, 471
U.S. 462, 475 (1985)).
jurisdiction does not require a large volume of contacts with
the forum state, as even a single purposeful contact may give
rise to personal jurisdiction. See McGee v. Int'l
Life Ins. Co., 355 U.S. 220, 223 (1957); see also
Licciardello v. Lovelady, 544 F.3d 1280, 1285 (11th Cir.
2008) (“The Court has made clear . . . that ‘[s]o
long as it creates a “substantial connection”
with the forum, even a single act can support
jurisdiction.'” (quoting Burger King, 471
U.S. at 475 n.18 (1985))). When the plaintiff alleges an
intentional tort, personal jurisdiction may be proper when
the nonresident defendant has no other contacts with the
forum. Calder v. Jones, 465 U.S. 783, 789-91 (1984).
The Eleventh Circuit follows the Calder
“effects” test for personal jurisdiction where
the plaintiff alleges an intentional tort, which requires (1)
an intentional tort (2) aimed at the forum state that (3)
“caused harm that the defendant should have anticipated
would be suffered in the forum state.”
Licciardello, 544 F.3d at 1286.
Licciardello, the Florida plaintiff was an
entertainer who had previously employed the Tennessee
defendant as his manager. Id. at 1282. Five years
after the plaintiff terminated their contract, the defendant
posted the plaintiff's trademarked name and picture on
his website, implying that the plaintiff endorsed him as a
personal manager. Id. Because the defendant's
actions were “expressly aimed” at the plaintiff
and caused injury to him in the forum state, the court held
that personal jurisdiction was proper. Id. at 1288.
Court finds that sufficient contacts exist to subject an
out-of-state defendant to the forum state's courts, the
Court must also consider whether the exercise of jurisdiction
would “offend ‘traditional notions of fair play
and substantial justice.'” Asahi Metal Indus.
Co. v. Superior Court of California, Solano Cty., 480
U.S. 102, 113 (1987) (quoting Int'l Shoe Co. v.
Washington, 326 U.S. 310, 316 (1945)). This analysis
requires weighing various factors: the burden placed upon the
defendant, the interests of the forum state in deciding the
dispute, the plaintiff's interest in litigating in that
forum, the interests of the interstate judicial system in an
efficient resolution of disputes, and the interests ...