33 - reply re mtd - jx

7/29/2019 33 - Reply re MTD - JX

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DEFENDANTS REPLY IN SUPPORT OF THEIR MOTION TO DISMISS FOR LACK OF PERSONAL

JURISDICTION

LAW OFFICE OF HARTWELL HARRISHartwell Harris (California Bar No. 241695)1809 Idaho AvenueSanta Monica, California 90403Telephone: (310) 497-8858Facsimile: (310) [email protected]

Attorney for DefendantsRAYMOND MOBREZILIANA LLANERASASIA ECONOMIC INSTITUTE, LLC

UNITED STATES DISTRICT COURT

DISTRICT OF ARIZONA

XCENTRIC VENTURES, LLC, anArizona limited liability company,

Plaintiff,

vs.

LISA JEAN BORODKIN, et al.,

Defendants.

CASE NO.: 11-CV-1426-PHX-GMS

DEFENDANTS REPLY IN SUPPORTOF THEIR MOTION TO DISMISS FORLACK OF PERSONAL JURISDICTIONPURSUANT TO F.R.C.P. 12(B)2

DEFENDANTS ASIA ECONOMIC COUNCIL INSTITUTE, LLC (AEI),

RAYMOND MOBREZ, and ILLIANA MOBREZ (Defendants) submit this Reply to

address arguments raised by Plaintiff in its Response to Defendants Motion to Dismiss

for Lack of Personal Jurisdiction Pursuant to F.R.C.P. 12(b)2.

MEMORANDUM OF POINTS AND AUTHORITIES

Plaintiff defended the underlying matter in California; Plaintiff alleges that

Californias judicial system was abused; Plaintiffs Complaint complains about

Defendants actions that occurred in California; important California law regarding the

Case 2:11-cv-01426-GMS Document 33 Filed 10/19/11 Page 1 of 7

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JURISDICTION

admissibility of recorded conversations is at issue; and California has a high interest in

protecting its judicial system. Plus, Plaintiff has not been able to locate and summon

Daniel Blackert, a named defendant in this matter and the lead attorney in the underlying

matter. By Defendants estimate, Plaintiff must locate and serve Mr. Blackert with

summons by November 18, 2011.

I. PERSONAL JURISDICTION OVER DEFENDANTS OFFENDSTRADITIONAL NOTIONS OF FAIR PLAY AND SUBSTANTIAL

JUSTICE

Assertion of personal jurisdiction over Defendants in this matter is reasonable only

if it does not offend traditional notions of fair play and substantial justice. International

Shoe Co. v. Washington, 326 U.S. 310, 316 (1945). The reasonableness test exists to

protect defendants from unfairly inconvenient litigation. Volkswagen Corp. v. Woodson,

444 U.S. 286, 292 (1980). Courts balance seven factors to determine the reasonableness

of exercising jurisdiction. Burger King Corp. v. Rudzewicz, 471 U.S. 462 (1985). The

most critical factor in this case is the extent of conflict with the sovereignty of the

defendants state. Plaintiff spends three pages of its Response arguing about the

admissibility of recorded conversations it made of Defendant Mobrez without his

knowledge. The fact that the Plaintiff is already posturing about the admissibility of these

tapes proves Defendants pointthat the admissibility of these tapes will be a critical

issue in this case. Since Arizona law regarding recorded conversations is less protective

than Californias law, personal jurisdiction over Defendants conflicts substantially with

the sovereignty of California. California has not only outlawed secretly recording

conversations but has also criminalized it.

The bulk of Plaintiffs case relies on recorded telephone calls. Plaintiff alleges in

its Complaint that Defendants conspired to trap it in some kind of extortion plot and

points to seven telephone calls made by Mobrez. (Complaint (Compl.) at 25-26).

Plaintiff alleges that after the telephone calls, Defendants filed suit. (Compl. at 28).


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These telephone calls were recorded unbeknownst to Defendants. (Compl. at 41).

Plaintiff details how Defendants described the contents of these conversations in

declarations filed with the Central District of California. (Compl. at 32-39). Next

Plaintiff alleges that these recordings show that Defendants lied in their declarations and

that Defendants fabricated allegations against it. (Compl. at 42-43). Plaintiff bases its

abuse of process claims largely on these factual allegations.

These allegations and the admissibility of these recorded conversations are key to

Plaintiffs burden of proof. A California court is more familiar with California law

regarding unlawfully recorded conversations than another forum. Plaintiff relies on an

order in the underlying action to support its contention that the recordings are admissible

under federal law, but the underlying action included federal questions whereas the matter

at hand does not. This case is based solely on diversity and does not include any federal

questions; thus, the laws of the forum govern the admissibility of recorded conversations.

Feldman v. Allstate Insurance Comp., 322 F.3d 660, 666-68 (9th Cir. 2003). InFeldman

the Ninth Circuit held:

The instant case is distinguishable, however, because it is a

diversity action. In diversity cases, a federal court must

conform to state law to the extent mandated by the principles

set forth in the seminal case ofEric R.R. v. Tompkins, 304

U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). Pursuant to

Erie and its progeny, federal courts sitting in diversity apply

state substantive law and federal procedural law. . . . We

hold that California Penal Code 632, like the Nevada law

at issue in Wray, is an exception to the general rule that the

Federal Rules govern the admissibility of evidence in

diversity cases. California Penal Code 632 both makes

taping a confidential conversation a crime and limits theadmissibility of illegally intercepted conversations. CAL.

PENAL CODE 632(a), (d). The statute thereby embodies a

state substantive interest in the privacy of California citizens

from exposure of their confidential conversations to third

parties. We also note that the California Constitution

expressly guarantees a right to privacy, and that having

ones personal conversations secretly recorded [and


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replayed] may well infringe upon the right to privacy

guaranteed by the California Constitution. [citation omitted]

For these reasons, we hold that Penal Code 632 is an

integral component of Californias substantive state policy of

protecting the privacy of its citizens, and is properly

characterized as substantive law within the meaning ofErie.Id. at 667-68. The Ninth Circuit inFeldman recognizes that Californias law regarding

the admissibility of recorded conversations is important to California law and thus its

sovereignty. California has aggressively protected its citizens from an unlawful intrusion

into their privacy by criminalizing secretly recording conversations.

II. PLAINTIFF NEEDS TO ALLEGE SOMETHING MORE TO MAKE APRIMA FACIE CASE OF PERSONAL JURISDICTION

The Ninth Circuit said inBancroft, that a foreign act with foreseeable effects in a

foreign forum does not always give rise to specific jurisdiction. Bancroft & Masters, Inc.

v. Augusta Nat. Inc., 223 F.3d 1082, 1088 (9th Cir. 2000); accord Bils v. Bils, 22 P.3d 38,

41 (2001) (Ariz.) (en banc) (We reject the argument . . . that an intentional tort that

causes harm to an Arizona resident will always be sufficient to conferin personam

jurisdiction on the Arizona courts. Under the Constitution of the United States, that is

where the analysis begins, but is not where it ends.). Personal jurisdiction requires

something more. The Ninth Circuit describes something more as express aiming at

the forum state, which is a concept that in the jurisdictional context hardly defines itself.

Bancroft, 223 F.3d at 1088. The Ninth Circuit then goes on to say that this express aiming

requirement is met when the defendant is alleged to have engaged in wrongful conduct

targeted at a plaintiff whom the defendant knows to be a resident of the forum state. Id.

Importantly, the Ninth Circuit arrived at this decision by analyzing the available

cases at that time. Bancroftwas an intellectual property case. This case is a malicious

prosecution case. Malicious prosecution and/or abuse of process cases are different than

other types of cases, even other types of tort cases, because not only is the plaintiff an

alleged victim but so is the judicial system that was allegedly abused. This should be an


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important consideration when determining personal jurisdiction in malicious prosecution

cases. Based on Plaintiffs reasoning, any time a plaintiff sues an out-of-state defendant,

plaintiff subjects himself to specific jurisdiction of that partys home state. The concept

of personal jurisdiction is more complex than this. Moreover, because Californias

judicial system was allegedly abused, it has a critical interest in hosting any abuse of

process claims allegedly committed against it.

III. WHITNEY DOES NOT APPLY IN THIS CASE.Plaintiff argues that this Court has personal jurisdiction over Defendants like it did

in another malicious prosecution case Plaintiff filed in this Court,Magedson v. Whitney

Information Network, Inc., Case No. 2:08-cv-01715-DGC (Campbell, J.). Plaintiff knows

that Whitney is not controlling but still encourages this Court to follow it because Whitney

involved identical arguments, identical points of law, virtually identical facts, and at least

one identical party. (Plaintiffs Response at p. 3, lines 21-23). In fact, the two cases are

not identical nor are the legal arguments. In Whitney, there was no dispute over the

admissibility of recorded conversations based on diametrically opposing evidentiary rules.

Thus, in Whitney, the sovereignty of the laws of Florida, the forum of the underlying

action, were not threatened.

IV. CONCLUSIONThis Court should decline to assert personal jurisdiction over Defendants and

dismiss this action.

DATE: Oct. 19, 2011 LAW OFFICES OF HARTWELL HARRIS

By /s/ Hartwell HarrisHartwell HarrisAttorney for Raymond Mobrez, Iliana Llaneras,and Asia Economic Institute, LLC.


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CERTIFICATE OF SERVICE

I hereby certify that on October 19, 2011 I electronically transmitted the attached

document to the Clerks Office using the CM/ECF System for filing, and for transmittal of

a Notice of Electronic Filing to the following:

David Gingras

Gingras Law Office, PLLC

3941 E. Chandler Blvd., #106-243

Phoenix, AZ 85048

David Edward Funkhouser, III

Quarles & Brady LLP

1 Renaissance Sq.

2 N Central Ave

Phoenix, AZ 85004-2391

And a courtesy copy of the foregoing delivered to:

HONORABLE G. MURRAY SNOW

United States District Court Sandra Day OConnor U.S. Courthouse

Suite 622 401 West Washington Street, SPC

80 Phoenix, AZ 85003

__/s/ Hartwell Harris_________


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33 - reply re mtd - jx

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