throbber
Case 1:20-cv-00052-CMA-SKC Document 178 Filed 03/18/22 USDC Colorado Page 1 of 31
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`IN THE UNITED STATES DISTRICT COURT
`FOR THE DISTRICT OF COLORADO
`Judge Christine M. Arguello
`
`Plaintiff,
`
`Defendants.
`
`
`
`Civil Action No. 20-cv-00052-CMA-SKC
`
`WESTERN ACCEPTANCE, LLC,
`
`
`
`v.
`
`GENERAL AGRICULTURE, INC., f/k/a General Agriculture, LLC,
`STIG WESTLING,
`CALLAGHAN BECKER,
`PHIL TAGAMI, and
`CALIFORNIA CAPITAL & INVESTMENT GROUP, INC.,
`
`
`
`
`ORDER GRANTING IN PART AND DENYING IN PART DEFENDANTS CALIFORNIA
`CAPITAL & INVESTMENT GROUP, INC.’S AND STIG WESTLING’S
`MOTIONS TO DISMISS
`
`
`
`
`This matter is before the Court on two motions: (1) Defendant California Capital
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`& Investment Group Inc.’s FRCP 12(b) Motion to Dismiss Plaintiff’s Second Amended
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`Complaint for Lack of Personal Jurisdiction and Failure to State a Claim (“CCIG’s
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`Motion,” Doc. # 130); and (2) Defendant Stig Westling’s Motion to Dismiss Plaintiff’s
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`Second Amended Complaint (“Westling’s Motion,” Doc. # 172). For the following
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`reasons, the Court grants in part and denies in part CCIG’s Motion, and the Court
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`grants Defendant Westling’s Motion.
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`

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`Case 1:20-cv-00052-CMA-SKC Document 178 Filed 03/18/22 USDC Colorado Page 2 of 31
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`I.
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`BACKGROUND
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`A.
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`ALLEGATIONS IN THE SECOND AMENDED COMPLAINT
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`This is a business dispute. Plaintiff Western Acceptance, LLC (“Western
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`Acceptance” or “Plaintiff”) is a Colorado limited liability company headquartered in
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`Colorado Springs, Colorado. (Doc. # 112.) Western Acceptance sued three California
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`corporations: Defendants General Agriculture, Inc. (“GenAg”), Sonoma Stainless, Inc.
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`(“Sonoma”), and California Capital & Investment Group, Inc. (“CCIG”). Western
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`Acceptance also sued three California citizens affiliated with those entities: Defendants
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`Stig Westling, Callaghan Becker, and Phil Tagami (the “Individual Defendants”). The
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`claims against Sonoma were previously dismissed by the Court. (Doc. # 154.)
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`According to the Second Amended Complaint, Plaintiff entered into a contract
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`with former Defendant SXIP, LLC1 (“SXIP”) for approximately $2 million to design and
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`manufacture business equipment referred to as a “Distillate Unit.” (Doc. # 112 at ¶ 10.)
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`“At some point in time during the manufacturing of the Distillate Unit,” Plaintiff alleges
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`that SXIP was acquired by GenAg. (Id. at ¶ 13.)
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`As a result, Plaintiff avers that it “entered into an oral contract” with GenAg and
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`“began dealing directly” with GenAg as to “the design and manufacture of the Distillate
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`Unit.” (Id. at ¶¶ 13, 17, 31.) In exchange, GenAg “took monies directly from” Western
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`Acceptance. (Id. at ¶¶ 13, 17, 31.) According to Western Acceptance, the oral
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`1 Although SXIP was initially named as a Defendant in this case, all claims against it have been
`dismissed. (Doc. # 83.)
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`2
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`

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`Case 1:20-cv-00052-CMA-SKC Document 178 Filed 03/18/22 USDC Colorado Page 3 of 31
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`agreement was “in addition to the contract with SXIP which GenAg now own[ed],” by
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`virtue of its acquisition of SXIP. (Id. at ¶ 31.)
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`Western Acceptance avers that, around the same time, GenAg’s alleged “agents”
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`began “personally visiting” Plaintiff’s facility in Colorado Springs, on GenAg’s behalf, to
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`“create[] a ruse that they wanted to partner with Plaintiff, [and] help Plaintiff grow its
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`business,” when in reality, they “were conspiring to learn of Plaintiff’s business” for
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`purposes of “eventually tak[ing]” Plaintiff’s property and money. (Id. at ¶¶ 11–16, 51.)
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`These alleged agents include: (1) GenAg’s Chief Executive Officer, Defendant Becker;
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`(2) GenAg’s retained consultant, Defendant Tagami, who was allegedly acting on behalf
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`of himself as well as the agent for CCIG; and (3) Defendant Westling. (Id.) The Second
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`Amended Complaint does not specify the capacity in which Mr. Westling worked for
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`GenAg or in what capacity Mr. Westling served as an alleged agent for GenAg.
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`The Second Amended Complaint identifies Mr. Tagami “upon information and
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`belief” as a consultant for GenAg or “employed by GenAg in some form or fashion.” (Id.
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`at ¶ 11.) The Second Amended Complaint also identifies Mr. Tagami as an employee of
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`CCIG. (Id. at ¶ 12.) Plaintiff alleges that GenAg retained CCIG and Mr. Tagami to serve
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`as “consultants to assist in the hemp-extraction business.” (Id.) Western Acceptance
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`states that Mr. Tagami was an “agent for CCIG at all times,” and he benefited CCIG,
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`GenAg, and himself through his tortious acts. (Id.)
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`Western Acceptance avers that Mr. Tagami visited its Colorado Springs facility
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`on multiple occasions as a consultant on behalf of GenAg. (Id. at ¶ 16.) During one such
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`visit, Mr. Tagami “attempt[ed] to take” its “equipment,” by disingenuously advising
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`3
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`Western Acceptance to “move its entire operation to another facility that [Mr. Tagami]
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`designated.” (Id. at ¶ 16.) Plaintiff further alleges that, after “GenAg learned while
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`visiting Plaintiff’s facility that Heaters were necessary for the processing of distillate,”
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`unspecified “persons from GenAg showed up at” Plaintiff’s facility and “took” the
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`Heaters. (Id. at ¶ 18.) Plaintiff complains that “Defendants” have thus far refused to
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`divulge the location of the Heaters. (Id. at ¶ 23.)
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`According to the Second Amended Complaint, one of GenAg’s agents informed
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`Western Acceptance “that after completion of the Distillate Unit, GenAg wanted to take
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`possession of it.” (Id. at ¶ 21.) Western Acceptance claims that it “vehemently refused”
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`to allow GenAg to do so. (Id.) At the time, Western Acceptance reportedly made clear to
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`GenAg that it “wanted the Distillate Unit sent to Colorado Springs following completion.”
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`(Id.) Plaintiff alleges that the Distillate Unit was taken by Defendants, and Defendants
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`refused to provide the location of the Distillate Unit. (Id. at ¶ 22, 23.)
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`B.
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`RELEVANT JURISDICTIONAL FACTS
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`The following jurisdictional facts regarding CCIG are taken from the Complaint,
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`as well as the declarations and exhibits attached to the parties’ briefing.
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`CCIG is a California corporation with a single office located in Oakland,
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`California. (Doc. # 130-1 ¶ 3.) Mr. Tagami is CCIG’s Chief Executive Officer and
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`President of the Board of Directors. (Id.)
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`On April 2, 2019, CCIG entered into a written Consulting Agreement with GenAg.
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`(Id. at ¶ 5; Doc. # 130-2.) The Consulting Agreement identifies CCIG as the “Consultant”
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`and Mr. Tagami as the “Consultant Contact.” (Doc. # 130-2 at 2.) The Consulting
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`4
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`Agreement states that CCIG will assist GenAg with “[g]eneral business consulting to
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`help advance [Client’s] existing business operations.” (Id.)
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`In connection with the consulting agreement, Mr. Tagami—in his capacity as an
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`employee of CCIG—traveled with a CCIG subcontracted architect to Colorado to
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`perform a two-day inspection of Plaintiff’s facility in Colorado in May 2019. (Doc. # 130-
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`1 at ¶¶ 7–8.) During the two-day inspection, Mr. Tagami spoke with one of Plaintiff’s
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`representatives, T. Alan Boyd, and informed him that the Colorado Springs facility did
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`not comply with “government codes and he recommended that all of Western
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`Acceptance’s equipment be moved out of the Colorado Springs facility to a location in
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`Oakland, California or elsewhere that [Mr. Tagami] controlled that would be code
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`compliant.” (Doc. # 134-3 at ¶ 17.)
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`Mr. Boyd informed Mr. Tagami “that under no circumstances was there going to
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`be any removal of existing equipment from the Colorado Springs location and that if any
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`business was to be done in the future, it must be done in Colorado Springs, at Western
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`Acceptance’s facility.” (Id. at ¶ 18.) Mr. Tagami, in response, told Mr. Boyd that “GenAg
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`and Western Acceptance would work together to develop the hemp extraction business
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`in the Colorado Springs facility.” (Id. at ¶ 19.)
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`On or about June 19, 2019, “CCIG’s subcontracted architect—with input from
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`CCIG—produced a written compliance report, which utilized the findings from the May
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`2019 site inspection.” (Doc. # 130-1 at ¶ 11.) The written report concluded that Plaintiff’s
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`Colorado Springs facility “was not in compliance with local building and zoning use
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`5
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`codes, and, therefore, would not qualify for the permits necessary for GenAg’s intended
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`use without substantial improvements.” (Id.)
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`After the site inspection, CCIG also assisted GenAg with preparing a written
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`proposal for Western Acceptance. (Id. at ¶ 12.) The proposal outlines “the future
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`operations between General Ag and Western Acceptance” and the “plan for achieving
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`compliance” at the Colorado Springs facility. (Doc. # 130-5.)
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`Shortly after, CCIG notified GenAg of its concerns related to proceeding with the
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`Colorado Springs facility. (Doc. # 130-1 at ¶ 15.) CCIG’s consulting agreement with
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`GenAg terminated on October 7, 2019. (Id. at ¶ 7.)
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`C.
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`PROCEDURAL HISTORY
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`Western Acceptance commenced this lawsuit on January 7, 2020. (Doc. # 1.) On
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`January 8, 2021, Western Acceptance filed a Second Amended Complaint, asserting
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`the following claims: (1) breach of contract by Sonoma; (2) breach of contract by
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`GenAg; (3) negligence by Sonoma; (4) civil theft by GenAg, CCIG, and the Individual
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`Defendants; (5) conspiracy by GenAg, CCIG, and the Individual Defendants;
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`(6) conversion by GenAg, CCIG, and the Individual Defendants; and (7) unjust
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`enrichment by all Defendants. (Doc. # 112 at ¶¶ 24–59.) As relief, Plaintiff requests
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`compensatory damages, interest, costs, and attorneys’ fees. (Id. at 10–11.)
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`On January 22, 2021, Defendants GenAg, Mr. Becker, Sonoma, and Mr. Tagami
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`filed motions to dismiss the claims against them. (Doc. ## 115, 118–119.) On
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`September 17, 2021, the Court dismissed the claims against Sonoma. (Doc. # 154.)
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`Additionally, the Court dismissed the civil conspiracy claims against GenAg, Mr. Becker,
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`6
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`Case 1:20-cv-00052-CMA-SKC Document 178 Filed 03/18/22 USDC Colorado Page 7 of 31
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`and Mr. Tagami. (Id.) The Court denied Mr. Tagami’s motion to dismiss for lack of
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`personal jurisdiction. (Id.)
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`On March 1, 2021, CCIG filed a motion to dismiss the claims against it under
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`Federal Rule of Civil Procedure 12(b)(2) and 12(b)(6). (Doc. # 130.) On December 2,
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`2021, Defendant Westling filed a motion to dismiss pursuant to Federal Rule of Civil
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`Procedure 12(b)(6). This matter is now ripe for review.
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`II.
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`LEGAL STANDARD
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`A.
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`RULE 12(b)(2) LEGAL STANDARD
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`To establish personal jurisdiction over a nonresident defendant, a plaintiff must
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`show both that jurisdiction is proper under the forum state’s long-arm statute and that
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`the exercise of personal jurisdiction over the defendant comports with the Due Process
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`Clause of the United States Constitution. See Equifax Servs., Inc. v. Hitz, 905 F.2d
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`1355, 1357 (10th Cir. 1990). Colorado’s long-arm statute permits the Court to exercise
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`personal jurisdiction to the full extent of the Due Process Clause, and therefore, the
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`analysis collapses into a single due process inquiry. See Colo. Rev. Stat. §§ 13-1-
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`124(1)(a)–(b); Dart Int’l, Inc. v. Interactive Target Sys., Inc., 877 F. Supp. 541, 543 (D.
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`Colo. 1995) (citing Safari Outfitters, Inc. v. Superior Court, 448 P.2d 783 (1968)); SGI
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`Air Holdings II LLC. v. Novartis Int’l, AG, 192 F. Supp. 2d 1195, 1197–98 (D. Colo.
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`2002).
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`“The Due Process Clause protects a [defendant’s] liberty interest in not being
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`subject to the binding judgments of a forum with which [it] has established no
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`meaningful ‘contacts, ties, or relations.’” Burger King Corp. v. Rudzewicz, 471 U.S. 462,
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`7
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`Case 1:20-cv-00052-CMA-SKC Document 178 Filed 03/18/22 USDC Colorado Page 8 of 31
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`471–72 (1985) (quoting Int’l Shoe Co. v. State of Washington, 326 U.S. 310, 319
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`(1945)). The cornerstone of the personal jurisdiction inquiry is whether “the defendant’s
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`conduct and connection with the forum State are such that he should reasonably
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`anticipate being haled into court there.” Trierweilver v. Croxton & Trench Holding Corp.,
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`90 F.3d 1523, 1532 (10th Cir. 1996) (quoting WorldWide Volkswagen v. Woodson, 444
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`U.S. 286, 295 (1980)). To comport with due process limitations, a court may exercise
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`personal jurisdiction only over defendants that have “certain minimum contacts [with the
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`jurisdiction] . . . .” Int’l Shoe, 326 U.S. at 316 (quoting Milliken v. Meyer, 311 U.S. 457,
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`463 (1940)).
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`When there are multiple defendants, as is the case here, “minimum contacts
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`must be found as to each defendant over whom the court exercises jurisdiction.” Home-
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`Stake Prod. Co. v. Talon Petroleum, C.A., 907 F.2d 1012, 1020 (10th Cir. 1990). The
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`minimum contacts standard may be satisfied in either of two ways—general or specific
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`jurisdiction. See Kuenzle v. HTM Sport–Und Freizeitgerate AG, 102 F.3d 453, 455 (10th
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`Cir. 1996). A court’s duty is the same in either case: it must guarantee that the exercise
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`of jurisdiction “does not offend traditional notions of fair play and substantial justice.”
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`World–Wide Volkswagen, 444 U.S. at 292 (1980) (quoting Int’l Shoe, 326 U.S. at 316)
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`(internal quotation omitted).
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`A court may assert general jurisdiction over a foreign corporation to hear any and
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`all claims against it when its affiliations with the state are so “continuous and
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`systematic” such that it is essentially at home in the forum state. Daimler AG v.
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`Bauman, 571 U.S. 117, 126 (2014) (quoting Goodyear Dunlop Tires Ops., S.A. v.
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`Brown, 564 U.S. 915, 919 (2011)). “For an individual, the paradigm forum for the
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`exercise of general juridiction is the individual's domicile; for a corporation, it is an
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`equivalent place.” Daimler, 571 U.S. at 137; see also Goodyear, 564 U.S. at 919. “The
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`‘paradigm’ forum[] in which a corporate defendant is ‘at home’ . . . [is] the corporation’s
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`place of incorporation and its principal place of business.” BNSF Ry. Co. v. Tyrell, 137
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`S. Ct. 1549, 1558 (2017) (internal citations omitted).
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`Specific jurisdiction, on the other hand, depends on an “affiliation between the
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`forum and the underlying controversy.” Id. For a court to assert specific jurisdiction, the
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`out-of-state defendant must have (1) purposefully directed its activities at residents of
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`the forum, and (2) the litigation must result from alleged injuries that “arise out of or
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`relate to” those activities. Burger King, 471 U.S. at 472. The purposeful direction
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`requirement “ensures that defendants will not be haled into a jurisdiction solely as a
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`result of random, fortuitous, or attenuated contacts, . . . or of the unilateral activity of
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`another party or a third person.” Id. at 475. To determine whether a defendant in a tort-
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`based lawsuit “purposefully directed its activities at the forum state,” the Court looks for
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`three elements: (1) an intentional act that was (2) aimed expressly at the forum state
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`with (3) the knowledge that the brunt of the injury would be felt in the forum state.
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`Calder v. Jones, 465 U.S. 783, 789–90 (1984).
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`Under Rule 12(b)(2) of the Federal Rules of Civil Procedure, a motion to dismiss
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`may be granted if the court lacks personal jurisdiction over the defendant. Although the
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`plaintiff bears the burden of establishing personal jurisdiction over the defendant, at the
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`preliminary stage of the litigation, this burden is “light.” Intercon, Inc. v. Bell Atl. Internet
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`Sol., Inc., 205 F.3d 1244, 1247 (10th Cir. 2000) (quoting Wenz v. Memery Crystal,
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`55 F.3d 1503, 1505 (10th Cir. 1995)). “The plaintiff may meet this burden ‘by
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`demonstrating, via affidavit or other written materials, facts that if true would support
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`jurisdiction over the defendant.’” Melea, Ltd. v. Jawer SA, 511 F.3d 1060, 1065 (10th
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`Cir. 2007) (quoting TH Agric. & Nutrition, LLC v. Ace European Grp. Ltd., 488 F.3d
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`1282, 1286 (10th Cir. 2007)). Where there has been no evidentiary hearing and the
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`motion to dismiss for lack of personal jurisdiction is decided on the basis of affidavits
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`and other written material, the plaintiff need “only make a prima facie showing of
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`personal jurisdiction.” Id.
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`The allegations in the complaint must be taken as true only so long as they
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`remain undisputed by the defendant’s affidavits. Id. Furthermore, only the well-pled
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`facts of plaintiff’s complaint, as distinguished from mere conclusory allegations, must be
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`accepted as true. Wenz, 55 F.3d at 1505. If the jurisdictional allegations are challenged
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`by an appropriate pleading, the plaintiff has “the duty to support jurisdictional allegations
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`in a complaint by competent proof of the supporting facts.” Pytlik v. Prof’l Ltd., 887 F.2d
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`1371, 1376 (10th Cir. 1989).
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`B.
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`RULE 12(b)(6) LEGAL STANDARD
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`Federal Rule of Civil Procedure 12(b)(6) provides that a defendant may move to
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`dismiss a claim for “failure to state a claim upon which relief can be granted.” “The
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`court's function on a Rule 12(b)(6) motion is not to weigh potential evidence that the
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`parties might present at trial, but to assess whether the plaintiff's complaint alone is
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`10
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`legally sufficient to state a claim for which relief may be granted.” Dubbs v. Head Start,
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`Inc., 336 F.3d 1194, 1201 (10th Cir. 2003) (internal quotation marks omitted).
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`“A court reviewing the sufficiency of a complaint presumes all of [a] plaintiff's
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`factual allegations are true and construes them in the light most favorable to the
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`plaintiff.” Hall v. Bellmon, 935 F.2d 1106, 1109 (10th Cir. 1991). “To survive a motion to
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`dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a
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`claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)
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`(quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Plausibility, in the
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`context of a motion to dismiss, means that the plaintiff pleaded facts which allow “the
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`court to draw the reasonable inference that the defendant is liable for the misconduct
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`alleged.” Id. However, the Court need not accept conclusory allegations without
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`supporting factual averments. Southern Disposal, Inc. v. Tex. Waste Mgmt., 161 F.3d
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`1259, 1262 (10th Cir. 1998). “Threadbare recitals of the elements of a cause of action,
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`supported by mere conclusory statements, do not suffice.” Iqbal, 556 U.S. at 678. “Nor
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`does the complaint suffice if it tenders naked assertions devoid of further factual
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`enhancement.” Id. (internal quotation marks and brackets omitted).
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`A.
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`CCIG’s RULE 12(b)(2) MOTION TO DISMISS
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`III.
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`ANALYSIS
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`CCIG avers that the Court lacks personal jurisdiction over it because Plaintiff
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`cannot establish general or specific personal jurisdiction in Colorado. Plaintiff does not
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`allege that the Court has general jurisdiction over CCIG. Thus, the Court’s inquiry is
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`limited to whether it can exercise specific jurisdiction over CCIG.
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`1.
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`Objections Based on Allegations in Complaint and Affidavits
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`As an initial matter, CCIG asserts that Plaintiff has failed to meet its burden to
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`make a prima facie showing of facts sufficient to justify personal jurisdiction. (Doc. # 130
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`at 5; Doc. # 139 at 3–4.) Without analysis, CCIG argues that “Plaintiff’s conclusory and
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`contradictory allegations will not suffice to refute CCIG’s instant motion to dismiss and
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`jurisdictional facts submitted in support.” (Doc. # 139 at 5.) The Court disagrees.
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`Although Plaintiff has the burden of proving jurisdiction exists, the burden is
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`“light” in the preliminary stages. Wenz, 55 F.3d at 1505. In this case, the parties
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`submitted conflicting affidavits on the issue of jurisdiction. (Compare Doc. # 130-1 with
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`Docs. ## 134-1, 130-2, and 130-3). In the face of conflicting affidavits, the Court must
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`resolve all factual disputes in Plaintiff’s favor. Behagen v. Amateur Basketball Ass'n of
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`U.S.A., 744 F.2d 731, 733 (10th Cir. 1984). As set forth below, the Court finds that
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`Plaintiff has met its light burden at this stage of the proceedings.
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`2.
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`No Imputed Contacts Rule
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`CCIG also argues that it cannot be subject to personal jurisdiction in this case, as
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`a matter of law, because at all times relevant, it was acting as an agent for GenAg.
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`(Doc. # 130 at 5–6.) CCIG contends that any alleged contacts with Colorado are
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`“ultimately imputed only to GenAg.” (Id. at 6.) CCIG also argues that individuals cannot
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`be subject to jurisdiction based on the acts of a principal or corporate entity. (Id. at 5–6.)
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`CCIG’s argument conflates the “no imputed contacts rule” with the “fiduciary
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`shield doctrine,” which gives greater protection to employees of corporations. See
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`Newsome v. Gallacher, 722 F.3d 1257, 1275 (10th Cir. 2013) (discussing the
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`“significant confusion” over these two doctrines). The “no imputed contacts” rule
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`prevents courts from imputing a corporation’s contacts with the forum state onto that
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`corporation’s employees. Id. Under the fiduciary shield doctrine, even if a particular
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`employee has “substantial contacts” with the forum state, “those contacts will not count
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`against the employee in the personal jurisdiction analysis so long as the employee
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`acted solely on the corporation’s behalf.” Id. Critically, however, while “the no-imputed
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`contacts rule is integral to the minimum contacts due process test,” the fiduciary shield
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`doctrine “only exists as a matter of state law.” Id. Thus, the fiduciary shield doctrine is
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`irrelevant to the present jurisdictional analysis. Serv. First Permits, LLC v. Lightmaker
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`Vancouver (Internet) Inc., No. 18-CV-02089-CMA-NYW, 2019 WL 109335, at *5 (D.
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`Colo. Jan. 4, 2019), report and recommendation adopted, No. 18-CV-02089-CMA-
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`NYW, 2019 WL 1081002 (D. Colo. Jan. 25, 2019) (holding that a foreign defendant’s
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`“status as a corporate officer or employee” did not “shield his contacts from the court’s
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`exercise of personal jurisdiction”).
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`Regardless, the Court agrees that, to exercise jurisdiction over a defendant, due
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`process requires that a party have its own minimum contacts with the forum state. See,
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`e.g., Melea, 511 F.3d at 1065. Thus, the Court examines CCIG’s own contacts with
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`Colorado to determine whether the exercise of personal jurisdiction is appropriate. The
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`Court will not examine GenAg’s contacts with Colorado to determine whether it can
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`exercise jurisdiction over CCIG. Burger King, 471 U.S. at 472; Calder, 465 U.S. at 789–
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`90.
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`13
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`3.
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`Whether CCIG Purposefully Directed Its Activities Toward Colorado
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`CCIG asserts that the Court lacks personal jurisdiction over it because it did not
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`purposefully direct its activities toward Colorado. (Doc. # 130 at 7–10.) To establish
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`specific jurisdiction over CCIG, Plaintiff must first show that CCIG purposefully directed
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`its activities towards Colorado. Dental Dynamics, LLC v. Jolly Dental Grp., LLC, 946
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`F.3d 1223, 1229 (10th Cir. 2020). The Tenth Circuit has recognized four frameworks
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`under which “purposeful direction” may be demonstrated: (1) continuing relationships
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`with forum state residents; (2) deliberate exploitation of the forum state market;
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`(3) harmful effects in the forum state (“harmful effects”); or (4) the “stream of commerce”
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`theory. Old Republic Ins. Co. v. Cont'l Motors, Inc., 877 F.3d 895, 909 n.21 (10th Cir.
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`2017) (identifying the four frameworks). Plaintiff seeks to establish specific personal
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`jurisdiction under the “harmful effects” framework. (Doc. # 134 at 6–11.)
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`a. Purposeful Direction Requirement
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`To establish that CCIG purposefully directed its activities at Colorado under the
`
`harmful effects framework, Plaintiff must show “(a) an intentional action that was
`
`(b) expressly aimed at the forum state with (c) knowledge that the brunt of the injury
`
`would be felt in the forum state.” XMission, L.C. v. Fluent LLC, 955 F.3d 833, 841 (10th
`
`Cir. 2020).
`
`i.
`
`“Intentional Action”
`
`The Second Amended Complaint alleges that CCIG committed four torts: (1) civil
`
`theft; (2) conspiracy; (3) conversion; and (4) unjust enrichment. (Doc. # 112 at ¶¶ 43–
`
`59.) The claims against CCIG are based on the allegation that Mr. Tagami, personally
`
`
`
`14
`
`

`

`Case 1:20-cv-00052-CMA-SKC Document 178 Filed 03/18/22 USDC Colorado Page 15 of 31
`
`and on behalf of CCIG, travelled to Colorado and tried to convince Western Acceptance
`
`to move its business operations to an out-of-state facility of Mr. Tagami’s choosing, as
`
`part of a plan to take control of Western Acceptance’s business and property.2 (Doc. #
`
`134-3 at ¶¶ 15–19; Doc. # 112 at ¶ 16.)
`
`CCIG first argues that the Court lacks personal jurisdiction over it because the
`
`Second Amended Complaint “fails to distinguish between the ‘intentional acts’ of CCIG
`
`and its employee.” (Doc. # 130 at 8.) However, “a corporation can only act through its
`
`agents.” Colorado Coffee Bean, LLC v. Peaberry Coffee Inc., 251 P.3d 9, 29 (Colo.
`
`App. 2010), as modified on denial of reh'g (Apr. 1, 2010); see also Wright Med. Tech.,
`
`Inc. v. Paragon 28, Inc., No. 18-CV-00691-PAB-STV, 2019 WL 4751807, at *5 (D. Colo.
`
`Sept. 30, 2019) (observing that “[a] corporation acts through its agents” and “the actions
`
`of corporate officers and directors are attributable to the corporate entity”) (citations
`
`omitted). In this case, Mr. Tagami is CCIG’s Chief Executive Officer and President of
`
`the Board of Directors. (Doc. # 130-1 at ¶ 3.) Plaintiff alleges that Mr. Tagami was acting
`
`on behalf of CCIG when he committed the torts outlined in the Second Amended
`
`Complaint. (Doc. # 112 at ¶¶ 12, 14.) Under these factual allegations, the Court may
`
`look to the actions of Mr. Tagami, on behalf of CCIG, to determine whether CCIG
`
`committed an intentional act aimed at Colorado.
`
`
`2 CCIG argues that the Court lacks personal jurisdiction over it because jurisdiction is based
`solely on Plaintiff’s flawed conspiracy claim. (Doc. # 130 at 6–7.) The Court disagrees based on
`the four causes of action alleged against CCIG and the allegations contained in the Second
`Amended Complaint.
`
`
`
`
`15
`
`

`

`Case 1:20-cv-00052-CMA-SKC Document 178 Filed 03/18/22 USDC Colorado Page 16 of 31
`
`CCIG also argues that Plaintiff’s Second Amended Complaint is contradictory
`
`because it alleges that Mr. Tagami is liable on behalf of CCIG and on behalf of himself
`
`individually. (Doc. 130 at 6.) However, “[u]nder Colorado law, a corporate officer or
`
`agent can be held personally liable for his individual tortious acts, even though
`
`committed on behalf of the corporation, which is also held liable.” List Interactive, Ltd. v.
`
`Knights of Columbus, 303 F. Supp. 3d 1065, 1078 (D. Colo. 2018) (citations and
`
`internal quotations omitted). Thus, this argument fails.
`
`Finally, CCIG avers that the allegations against it are “neither tortious nor true,”
`
`and, therefore, the jurisdictional facts disprove any “intentional tortious action.” (Id. at 8–
`
`9) In other words, even if CCIG committed an intentional act, it argues that the act was
`
`not tortious. (Id.) For purposes of establishing jurisdiction under the harmful effects
`
`framework, it remains an open question “whether a defendant’s intentional [action] must
`
`be wrongful or tortious or whether innocent intentional action suffices.” Burns v. Ledru,
`
`No. 12-cv-02646-RBJ-KLM, 2013 WL 1129425, at *5 (D. Colo. Feb. 5, 2013) (quoting
`
`Sharpshooter Spectrum Venture, LLC v. Consentino, No. 09-cv-00150-WDM-KLM, 2009
`
`WL 4884281, at *6 (D. Colo. Dec. 10, 2009)).
`
`Regardless, Plaintiff has unquestionably alleged that CCIG, through the acts of
`
`its Chief Executive Officer, intentionally acted in a wrongful manner. See Dudnikov v.
`
`Chalk & Vermilion Fine Arts, Inc., 514 F.3d 1063, 1073 (10th Cir. 2008) (avoiding “th[e]
`
`thicket” of answering whether “any intentional act, wrongful or not” satisfied the first
`
`element of the harmful effects test, because the plaintiffs’ complaint alleged wrongful
`
`conduct). Plaintiff’s allegations, though disputed by CCIG, are supported by Plaintiff’s
`
`
`
`16
`
`

`

`Case 1:20-cv-00052-CMA-SKC Document 178 Filed 03/18/22 USDC Colorado Page 17 of 31
`
`evidence. See Old Republic, 877 F.3d at 903 (“We resolve all factual disputes in favor
`
`of the plaintiff in determining whether plaintiff has made a prima facie showing [of
`
`jurisdiction].”). Accordingly, Plaintiff has adequately established that CCIG took
`
`intentional action.
`
`ii.
`
`“Expressly Aimed”
`
`The second element of the harmful effects test requires that the forum state itself
`
`be the “focal point of the tort.” Dudnikov, 514 F.3d at 1074 n.9. CCIG argues that the
`
`focal point if of its alleged actions was not Colorado, but instead, California, where “the
`
`ultimate theft and conversion” of the Distillate Unit occurred. (Doc. # 130 at 9–11.) The
`
`Court disagrees.
`
`While the alleged taking of the Distillate Unit occurred strictly in California, the
`
`claims against CCIG are Colorado-centric—namely that CCIG and its agent took steps
`
`in Colorado to wrongfully take Plaintiff’s property. The pleadings and supporting
`
`jurisdictional evidence are sufficient to show that Mr. Tagami, on behalf of CCIG, visited
`
`the Colorado Springs facility “multiple times under the guise of being a compliance
`
`consultant for GenAg,” for purposes of learning “Plaintiff’s business, its method of
`
`operating, its use and ownership of equipment, and its trade secrets,” to “eventually
`
`take” Plaintiff’s property. (Doc. # 112 ¶¶ 16, 51.) Notably, Plaintiff alleges that on one
`
`visit to Colorado, Mr. Tagami “attempt[ed] to take” Western Acceptance’s “equipment.”
`
`(Id. at ¶ 16.) Under these circumstances, CCIG could reasonably expect to be haled
`
`into court in Colorado. See Rain Int’l, LLC v. Cook, No. 2:20-cv-00537-JNP-DBP, 2021
`
`WL 1063310, at *5 (D. Utah Mar. 18, 2021) (finding that a nonresident defendant
`
`
`
`17
`
`

`

`Case 1:20-cv-00052-CMA-SKC Document 178 Filed 03/18/22 USDC Colorado Page 18 of 31
`
`expressly aimed her allegedly tortious conduct at Utah, where “some of the tortious
`
`conduct allegedly occurred while [the defendant] was physically present in Utah”).
`
`iii.
`
`“Brunt of Injury”
`
`The third element of the harmful effects test “concentrates on the consequences
`
`of the defendant’s action” and where the alleged harm was actually felt by the plaintiff.
`
`Dudnikov, 514 F.3d at 1074–75. The prima facie evidence establishes that CCIG,
`
`through Mr. Tagami, knew that Western Acceptance operated in Colorado. (Doc. ##
`
`130-1 at 10; ¶ 16–17; 130-2 ¶¶ 15–16; 134-3 at ¶¶ 12–13, 17.) Drawing all reasonable
`
`inferences in Plaintiff’s favor, it is fair to say that CCIG knew that the brunt of any injury
`
`to Western Acceptance would be felt in Colorado. Therefore, the third element is met.
`
`See Dudnikov, 514 F.3d at 1077 (finding the “brunt of the injury” element met, where the
`
`defendant knew that the plaintiffs’ business was located in Colorado, and therefore,
`
`knew that the effects of its actions targeting the business would be felt there).
`
`b. “Arising Out Of” Requirement
`
`The assertion of specific jurisdiction also requires Plaintiff to prove its injuries
`
`arise out of CCIG’s forum-related activities. Old Republic, 877 F.3d at 908. As the Tenth
`
`Circuit has explained, specific jurisdiction “is premised on something of a quid pro quo;
`
`in exchange for ‘benefitting’ from some purposive conduct directed at the forum state, a
`
`party is deemed to consent to the exercise of jurisdiction for claims related to those
`
`contacts.” Dudnikov, 514 F.3d at 1078. There are “potentially two” ways to satisfy the
`
`“arising out of” requirement—(1) the “but-for” test; and (2) the “proximate cause” test.
`
`Newsome, 722 F.3d at 1269-70; accord Dudnikov, 514 F.3d at 1079 (

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