Judge: Daniel S. Murphy, Case: 22STCV11206, Date: 2022-10-07 Tentative Ruling

Case Number: 22STCV11206    Hearing Date: October 7, 2022    Dept: 32

BACKGROUND

            On April 1, 2022, Plaintiff Banjul, Inc. filed this action against Defendant Zalta Boutique II, Inc., alleging (1) breach of contract, (2) open book account, and (3) goods sold and delivered. The complaint arises from Defendant’s alleged failure to pay for goods shipped by Plaintiff.

            Plaintiff has sued Zalta Boutique II, Inc., whereas the complaint appears to show goods that were shipped to Zalta Boutique. Defendant, Zalta Boutique II, Inc., argues that it is not the same company as Zalta Boutique. On July 11, 2022, the Court granted Defendant’s motion to quash for lack of personal jurisdiction. Defendant had presented evidence that it was a New York corporation that had no dealings in California and no transactions with Plaintiff. In opposition, Plaintiff failed to present evidence of Defendant’s contacts with California.

            On July 28, 2022, Plaintiff filed an amended complaint with allegations that Zalta Boutique II is the alter ego and successor of Zalta Boutique, and is owned and operated by the same individuals. Plaintiff alleges that Zalta Boutique II was formed for the sole purpose of avoiding liability.

            On September 6, 2022, Defendant filed the instant motion to quash on the same grounds as its previous motion to quash.  

LEGAL STANDARD

A defendant may serve and file a notice of motion to quash service of summons on the ground that the court lacks jurisdiction. (Code Civ. Proc., § 418.10, subd. (a).) “When a court . . . finds that in the interest of substantial justice an action should be heard in a forum outside this state, the court shall stay or dismiss the action in whole or in part on any conditions that may be just.” (Id., § 410.30, subd. (a).) “The court may dismiss without prejudice the complaint in whole, or as to that defendant, when dismissal is made pursuant to Section 418.10.” (Id., § 581, subd. (h).)

A court may exercise personal jurisdiction over a defendant if the defendant has established sufficient “minimum contacts” with the forum state, and the exercise of jurisdiction would not offend “traditional notions of fair play and substantial justice.” (In re Marriage of Fitzgerald & King (1995) 39 Cal.App.4th 1419, 1425-26.)

A defendant may establish sufficient minimum contacts with the forum state in one of two ways. For a court to exercise general jurisdiction, the defendant must have contact with the forum state that is substantial, continuous, and systematic. (Vons Companies, Inc. v. Seabest Foods, Inc. (1996) 14 Cal.4th 434, 445.) In such a case, the cause of action need not be related to the defendant’s contact with the forum state. (Id. at p. 446.) For a court to exercise specific jurisdiction, the following elements must be met: (1) the defendant has purposefully availed themselves of forum benefits; (2) the controversy is related to or arises out of the defendant’s contacts with the forum; and (3) the assertion of personal jurisdiction would comport with fair play and substantial justice. (Snowney v. Harrah’s Entertainment, Inc. (2005) 35 Cal.4th 1054, 1062.)

When personal jurisdiction is challenged by a nonresident defendant, the burden of proof is upon the plaintiff to demonstrate by a preponderance of the evidence that minimum contacts exist between the defendant and the forum state to justify imposition of personal jurisdiction. (Mihlon v. Sup. Ct. (1985) 169 Cal. App. 3d 703, 710.) Once facts showing minimum contacts with the forum state are established, it becomes the defendant’s burden to demonstrate that the exercise of jurisdiction would be unreasonable. (Vons, supra, 14 Cal. 4th at p. 447.)

DISCUSSION

            Defendant is a New York corporation that is not registered in California or qualified to do business in California. (Elmann Decl. ¶¶ 3-4.) Defendant does not conduct any business in California, does not maintain any offices or assets in California, and has no employees in California. (Id., ¶ 5.) Defendant denies ever conducting business with Plaintiff. (Id., ¶ 6.) Defendant Zalta Boutique II, Inc. is not the same company as Zalta Boutique. (Id., ¶¶ 7, Ex. A, B.) Defendant is not the successor in interest of or financially related to Zalta Boutique. (Id., ¶ 8.) Therefore, Defendant does not have substantial and continuous contacts with California, nor has Defendant availed itself of California benefits. As a result, the Court lacks personal jurisdiction over Defendant.

            In opposition, Plaintiff argues, as it did previously, that the complaint “does state and plead sufficient contacts and actions by the Defendant in and availing itself of California to render jurisdiction proper.” (Opp. 1:14-17.) Plaintiff argues that “Defendant's motion attempts to improperly attempts to challenge the factual accuracy of the pleadings – making pre-mature factual disputes which are improper at the current (pleading/demurrer) stage of the case.” (Opp. 1:18-20.)

            However, this is not a demurrer challenging the sufficiency of Plaintiff’s factual allegations. This is a motion to quash for lack of jurisdiction. When jurisdiction is challenged by a defendant, it is the plaintiff’s burden to show by a preponderance of the evidence that minimum contacts exist. (Mihlon, supra, 169 Cal. App. 3d at p. 710.) This burden cannot be satisfied by referencing allegations in the complaint. “It is immaterial that the plaintiffs have embellished the present complaint to invoke legal theories not articulated in the earlier versions.” (MIB, lnc. v. Superior Court (1980) 106 Cal.App.3d 228, 235.)

Plaintiff neither cites nor incorporates any evidence to rebut Defendant’s showing that it is not related to Zalta Boutique and has never transacted business in California or with Plaintiff. The purchase orders attached to the complaint show that Plaintiff transacted with Zalta Boutique, not Zalta Boutique II. Plaintiff has no evidence that those are the same companies. Ultimately, Defendant’s evidence that it has no minimum contacts with California remains unrebutted. Therefore, the Court lacks personal jurisdiction over Defendant.  

CONCLUSION

            Defendant’s motion to quash summons is GRANTED.