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Dahl v. Keller

United States District Court, E.D. Wisconsin

May 20, 2019

COLLIN DAHL, et al., Plaintiffs,
v.
BARBARA J. KELLER, et al., Defendants.

          DECISION AND ORDER ON THE DEFENDANTS' MOTIONS TO DISMISS

          WILLIAM E. DUFFIN, U.S. MAGISTRATE JUDGE

         1. Background

         A small single-engine aircraft crashed on September 18, 2016, in Door County, Wisconsin. Killed in the crash were the pilot, Ralph L. Keller, and a passenger, sixteen-year-old Olivia Dahl. Olivia's estate and her parents, Collin and Jennifer Dahl, initiated this lawsuit in Milwaukee County Circuit Court. The defendants timely removed it to federal court. Two of the defendants, Barbara J. Keller, who is the widow of the pilot, and a trust she controls, The Barbara J. Keller Trust, have moved to dismiss the plaintiffs' amended complaint.

         2. Motion to Dismiss Under Rule 12(b)(2)

         Barbara argues that she lacks sufficient contacts with Wisconsin to subject her to the state's personal jurisdiction. She contends that, contrary to what is alleged in the complaint, she is domiciled in Illinois, not Wisconsin-a fact about which there is no dispute. The court addressed this fact previously as part of its inquiry into whether complete diversity of citizenship existed. (ECF No. 49.) If Barbara were domiciled in Wisconsin, as the amended complaint alleges, complete diversity of citizenship would not exist and the court would lack subject matter jurisdiction. See 28 U.S.C. § 1332(a)(1). But while domicile is determinative of citizenship for diversity purposes, personal jurisdiction may be established through means other than domicile.

         “Federal courts ordinarily follow state law in determining the bounds of their jurisdiction over persons.” Daimler AG v. Bauman, 571 U.S. 117, 125 (2014) (citing Fed. R. C i v . P . 4(k)(1)(A)) . Thus, this court looks first to Wisconsin's long-arm s tatute to determine whether it has personal jurisdiction over a defendant. Felland v. Clifton, 682 F.3d 665, 678 (7th Cir. 2012); see also Steel Warehouse v. Leach, 154 F.3d 712, 714 (7th Cir. 1998) (“A federal district court exercising diversity jurisdiction has personal jurisdiction over a nonresident only if a court of the state in which it sits would have such jurisdiction.”). Wisconsin courts employ a two-step inquiry when determining whether personal jurisdiction may be exercised over a nonresident defendant. The first step is to determine whether the defendant meets the criteria for personal jurisdiction under the Wisconsin long-arm statute. Kopke v. A. Hartrodt S.R.L., 245 Wis.2d 396, 409, 629 N.W.2d 662 (2001). If the requirements of the long-arm statute are satisfied, then the court must consider whether the exercise of jurisdiction comports with due process requirements. Id. Plaintiff bears the burden of establishing personal jurisdiction. See Purdue Research Found. v. Sanofi-Synthelabo, S.A., 338 F.3d 773, 782 (7th Cir. 2003).

         A person is subject to personal jurisdiction in Wisconsin if she “[i]s engaged in substantial and not isolated activities within this state ….” Wis.Stat. § 801.05(1)(d). Stated another way, a person is subject to personal jurisdiction in Wisconsin if she “takes up local presence or status within the state.” Rasmussen v. GMC, 2011 WI 52, ¶18, 335 Wis.2d 1, 803 N.W.2d 623 (internal quotation marks omitted). Factors courts consider are “the quantity of the contacts, the nature and quality of those contacts, the source and connection of the contacts to the claim made, the interest of Wisconsin in the action and the convenience of the parties.” Id. at ¶19. Although due process may independently limit the reach of Wisconsin's long-arm statute, the statutory and constitutional analyses are intertwined in that Wisconsin's statute is intended “to provide for the exercise of jurisdiction over nonresident defendants to the full extent consistent with the requisites of due process of law.” Id. at ¶20 (internal quotation marks omitted).

         As stated above, Barbara's sole argument in support of her contention that she is not subject to personal jurisdiction in Wisconsin is that she is not domiciled here. But, again, simply because she is not domiciled in Wisconsin does not mean she is not subject to personal jurisdiction in Wisconsin.

         The plaintiffs argue that, because Barbara owns a vacation home in Wisconsin, she is subject to Wisconsin's personal jurisdiction. But that, by itself, does not establish that the court has personal jurisdiction over Barbara or the trust. Rush v. Savchuk, 444 U.S. 320, 328 (1980) (“We held in Shaffer[ v. Heitner, 433 U.S. 186, 208-09 (1977), ] that the mere presence of property in a State does not establish a sufficient relationship between the owner of the property and the State to support the exercise of jurisdiction over an unrelated cause of action.”) “The ownership of property in the State is a contact between the defendant and the forum, and it may suggest the presence of other ties. Jurisdiction is lacking, however, unless there are sufficient contacts to satisfy the fairness standard of International Shoe.” Rush, 444 U.S. at 328.

         Recognizing that the ownership of a home in Wisconsin may suggest additional contacts, the plaintiffs ask to pursue discovery regarding Barbara's contacts with Wisconsin in the event the court finds mere property ownership insufficient. (ECF No. 81 at 4.) Barbara does not address this issue in reply.

         “If a defendant files a motion to dismiss for lack of personal jurisdiction, a plaintiff ‘is entitled to reasonable discovery, lest the defendant defeat the jurisdiction of a federal court by withholding information on its contacts with the forum.'” Bancoult v. McNamara, 214 F.R.D. 5, 10 (D.D.C. 2003) (quoting El-Fadl v. Cent. Bank of Jordan, 316 U.S.App.D.C. 86, 75 F.3d 668, 676 (D.C. Cir. 1996)); see also Andersen v. Sportmart, Inc., 179 F.R.D. 236, 241 (N.D. Ind. 1998). However, “[a]t a minimum, the plaintiff must establish a colorable or prima facie showing of personal jurisdiction before discovery should be permitted.” Cent. States, Se. & Sw. Areas Pension Fund v. Reimer Express World Corp., 230 F.3d 934, 946 (7th Cir. 2000); see also In re Honey Transshipping Litig., 87 F.Supp.3d 855, 873 (N.D. Ill. 2015); Bancoult, 214 F.R.D. at 10.

         As the Court noted in Rush, the ownership of property in a state may suggest the existence of other contacts. Therefore, under the facts presented, ordinarily it would be appropriate to deny without prejudice the motion to dismiss and grant the plaintiffs' request to pursue discovery limited to the question of whether the court has personal jurisdiction over Barbara and the trust she controls. However, discovery related to Barbara's contacts with Wisconsin is necessary only if the amended complaint alleges a plausible claim against Barbara and her trust. Because Barbara and her trust separately move to dismiss the amended complaint under Rule 12(b)(6) for failure to state a claim, the court turns to the question of whether the plaintiffs have adequately alleged a cause of action against these defendants.

         3. Motion to Dismiss Under Rule 12(b)(6)

         To survive a motion to dismiss under Rule 12(b)(6) “a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face[.]'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim “has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. A claim satisfies this pleading standard when its factual allegations “raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555-56. The court ...


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