Judge: Daniel M. Crowley, Case: 22STCV28496, Date: 2023-01-19 Tentative Ruling

Case Number: 22STCV28496    Hearing Date: January 19, 2023    Dept: 28

Specially Appearing Super Magnificent Coffee Company’s Motion to Quash Service of Summons and Complaint

Having considered the moving, opposing and reply papers, the Court rules as follows. 

BACKGROUND

On August 31, 2022, Plaintiff Vera Merhavi (“Plaintiff”) filed this action against Defendants Super Magnificent Coffee Company (“SMCC”), Unibail-Rodamco-Westfield (“URW”) Westfield Topanga Owner, LLC (“WTO”) and Westfield Corp. (“WC”) for negligence and premises liability. Plaintiff later amended the complaint to include Defendant International Coffee & Tea, LLC (“ICT”).

On October 17, 2022, URW, WTO and WC filed an answer. On December 5, 2022, ICT filed an answer.

On November 3, 2022, Specially Appearing Defendant SMCC filed a Motion to Quash Service for Lack of Personal Jurisdiction, to be heard on January 19, 2023. On January 5, 2023, Plaintiff filed an opposition. On January 11, 2023, SMCC filed a reply.

Trial is currently scheduled for February 28, 2024.

PARTY’S REQUESTS

SMCC requests the Court quash the service of summons.

Plaintiff requests the Court deny the motion.

LEGAL STANDARD

A plaintiff has the initial burden to establish valid statutory service of a summons and complaint. (Dill v. Berquist Const. Co., Inc. (1994) 24 Cal.App.4th 1426, 1439-40; Floveyor Internat. v. Sup. Ct. (1997) 59 Cal.App.4th 789, 794.) 

A defendant may file a motion to quash a service of summons on the ground of lack of jurisdiction of the court over said defendant. CCP § 418.10 (a). A motion made under CCP § 418.10 does not constitute an appearance unless a court denies the motion.

Personal jurisdiction takes two forms—general and specific. (Vons Companies, Inc. v. Seabest Foods, Inc. (1996) 14 Cal.4th 434, 445.) General jurisdiction exists when a nonresident defendant has “substantial . . . continuous and systematic” contacts in the forum state. (Id.) General jurisdiction only exists when a defendant’s contacts with the forum state “are so constant and pervasive as to render it essentially at home” there. (Daimler AG v. Bauman (2014) 571 U.S. 117, 122.) “A court may exercise specific jurisdiction over a nonresident defendant only if: (1) the defendant has purposefully availed himself or herself of forum benefits [citations.]; (2) the controversy is related to or arises out of [the] defendant's contacts with the forum [citations.]; and (3) the assertion of personal jurisdiction would comport with fair play and substantial justice [citations.].” (Pavlovich v. Superior Court (2002) 29 Cal.4th 262, 269 (internal quotations omitted).)

Under California’s long-arm statute, California courts may exercise personal jurisdiction on any basis not inconsistent with the Constitutions of California and the United States. (Code Civ. Proc., § 410.10.) The exercise of jurisdiction over a nonresident defendant comports with these Constitutions if the defendant has such minimum contacts with the state that the assertion of jurisdiction does not violate traditional notions of fair play and substantial justice. (Pavlovich v. Superior Court (2002) 29 Cal.4th 262, 268.) A court may exercise general personal jurisdiction over a foreign corporation only where the corporation is “essentially at home” in the forum state. (Goodyear v. Dunlop Tires Operations, S.A. v. Brown (2011) 564 U.S. 915, 919.) A corporation’s place of incorporation and principal place of business are the paradigm bases for general personal jurisdiction. (Daimler AG v. Bauman (2014) 571 U.S. 117, 137.) The U.S. Supreme Court has stated “it is the defendant’s conduct that must form the necessary connection with the forum State that is the basis for its jurisdiction over him.” (Walden v. Fiore (2014) 571 U.S. 277.) “The unilateral activity of those who claim some relationship with a nonresident defendant cannot satisfy the requirement of contact with the forum State.” (T.A.W. Performance, supra, 53 Cal.App.5th at 643.) It is essential that there be some act by which the foreign defendant purposefully avails itself of the privilege of conducting activities within the forum State. (Ibid.)

“Although the defendant is the moving party and must present some admissible evidence (declarations or affidavits) to place the issue before the court (by showing the absence of minimum contacts with the state), the burden of proof is on the plaintiff to establish, by a preponderance of the evidence, a basis for jurisdiction (minimum contacts between the defendant and the forum state) . . . .” (School Dist. of Okaloosa County v. Superior Court (1997) 58 Cal.App.4th 1126, 1131.) “If the plaintiffs are able to make a showing of minimum contacts with the forum state, ‘the burden shifts to the defendant to present a compelling case demonstrating that the exercise of jurisdiction by our courts would be unreasonable. [Citations.]’” (CenterPoint Energy, Inc. v. Superior Court (2007) 157 Cal.App.4th 1101, 1118)

DISCUSSION

Plaintiff alleges that, while on Defendants’ premises, Plaintiff tripped and fell due to a dangerous condition.

SMCC contends that it is not subject to general or specific jurisdiction in this Court as it is a foreign corporation not doing business in California. To determine whether a foreign corporation has the requisite minimum contacts with California for general personal jurisdiction, the court considers only the foreign defendant’s contacts with California at the time of the alleged conduct and at the time of service of summons. (DVI, Inc. v. Superior Court (2002) 104 Cal.App.4th 1080, 1100.) SMCC contends that it is a Hungarian based company that does not conduct any business in the United States. (Lim Decl. ¶ 4.) It does not control or operate any stores in the United States, nor does it have any officers or representatives in the United States. (Id. at ¶ 5.) SMCC is registered as a foreign entity in California but limits its activities to that of a holding company with no control over the operation of its subsidiaries. (Id. at ¶ 6.) Based on the above, the Court finds there is no general jurisdiction over SMCC.

SMCC also contends that specific jurisdiction is not met. The Court agrees. The case in question does not arise out of SMCC’s connection with California. SMCC did not own or operate the subject premises. (Id. at ¶ 8.) SMCC has no connection to the premises, Plaintiff or facts giving rise to the cause of action. (Id.) SMCC also has not made a general appearance in the action.

Plaintiff argues that SMCC is not an overseas entity, but rather a company operating in California. Plaintiff cites to the fact that SMCC was properly served by way of registered agent with the California Secretary of State; merely using a DBA to operate does not create a distinct legal entity. Plaintiff cites to the fact that the ‘Coffee Bean & Tea Leaf’s’ website cites that SMCC is the business entity that operates the subject premises. (Bakh Decl. ¶ 10). SMCC is registered with the State of California as a corporation, and even has its headquarters in Los Angeles. (Bakh Decl. ¶¶ 11-12.) SMCC has approximately 200 employees in California, and over 100 locations. (Bakh Decl. ¶¶10, 13.)

SMCC argues, again, that it is a holding company; ICT, which has been brought in as another Defendant, is the actual party Plaintiff is referencing in her opposition. SMCC is not registered as a retail establishment, but rather as a holding company with the California Secretary of State. (P’s Ex. 4). ICT, however, is registered to do business as a retail establishment serving coffee and tea. Beyond noting the name on the subject website, there is no indication that SMCC is the appropriate entity in this case. Plaintiff has not provided evidence that ICT and SMCC are effectively the same entity, although the burden on Plaintiff is to provide such evidence. Mere ownership of a subsidiary does not subject a nonresident parent company to the subsidiary’s forum contacts. (DVI, Inc., supra, 104 Cal.App.4th at 1086.) In order to exercise personal jurisdiction over a foreign parent corporation based on the activities of its subsidiary, the plaintiff must establish an alter ego relationship, or that the parent corporation exercises such a degree of control of the subsidiary as to reflect the parent corporation’s purposeful disregard of the subsidiary’s independent corporate existence.” (Id. at 1087, quoting Sonora Diamond Corp. v. Superior Court (2000) 83 Cal. App. 4th 523, 542.) Plaintiff has not met this burden. The Court grants the motion.

CONCLUSION

Specially Appearing Super Magnificent Coffee Company’s Motion to Quash Service of Summons and Complaint is GRANTED. Service of summons and the complaint on SMCC is quashed.

            Moving party is ordered to give notice of this ruling.

Moving Party is ordered to file the proof of service of this ruling with the Court within five days.

The parties are directed to the header of this tentative ruling for further instructions.