United States District Court, D. Delaware
Robert Clemens and Kevin Yow filed a motion to dismiss
Plaintiffs complaint for lack of personal jurisdiction
pursuant to Federal Rule of Civil Procedure 12(b)(2). (D.I.
5; see also D.I. 11). The matter was referred to a
Magistrate Judge (D.I. 17), who issued a Report and
Recommendation recommending that Defendants' motion be
granted (D.I. 18). Plaintiff objects to the Magistrate
Judge's finding that this Court cannot properly exercise
jurisdiction under the Delaware long-arm statute. (D.I. 19 at
3). Defendants have responded. (D.I. 20). I review the
objection to the Report and Recommendation de novo.
28 U.S.C. § 636(b)(1).
reviewing a motion to dismiss pursuant to Rule 12(b)(2), a
court must accept as true all allegations of jurisdictional
fact made by the plaintiff and resolve all factual disputes
in the plaintiffs favor. Toys "R" Us, Inc. v.
Step Two, S.A., 318 F.3d 446, 457 (3d Cir. 2003). Once a
jurisdictional defense has been raised, the plaintiff bears
the burden of establishing, with reasonable particularity,
that such minimum contacts have occurred between the
defendant and the forum sufficient to support jurisdiction.
Provident Nat'l Bank v. Cal. Fed. Sav. &
Loan Ass'n, 819 F.2d 434, 437 (3d Cir.
1987). To meet this burden, the plaintiff must produce
"sworn affidavits or other competent evidence, "
since a Rule 12(b)(2) motion "requires resolution of
factual issues outside of the pleadings." Time Share
Vacation Club v. Atlantic Resorts, Ltd., 735 F.2d 61, 67
n.9 (3d Cir. 1984).
personal jurisdiction analysis involves both a statutory and
constitutional inquiry. Shoemaker v. McConnell, 556
F.Supp.2d 351, 354 (D. Del. 2008). First, the court must
consider whether a defendant's actions come within any of
the provisions of the state long-arm statute. See Intel
v. Broadcom, 167 F.Supp.2d 692, 700 (D. Del. 2001).
Second, the court must determine whether exercising
jurisdiction over the defendant in the forum comports with
the Due Process Clause of the Constitution. Id.
respect to the first step, the court applies the law of the
state in which the district court is located. See
Id. Delaware's long-arm statute authorizes
jurisdiction over a nonresident when, among other things,
that party or its agent:
(1) Transacts any business or performs any character of work
or service in the State; (2) Contracts to supply services or
things in this State; (3) Causes tortious injury in the State
by an act or omission in this State; (4) Causes tortious
injury in the State or outside the State by an act or
omission outside the State if the person regularly does or
solicits business, engages in any other persistent course of
conduct in the State or derives substantial revenue from
services, or things used or consumed in the State....
10 Del. C. § 3104(c)(1)-(4). "With the exception of
(c)(4), the long-arm statute requires a showing of specific
jurisdiction." Phunware, Inc. v. Excelmind Grp.
Ltd., 117 F.Supp.3d 613, 622 (D. Del. 2015) (citation
omitted). Subsection (c)(4), on the other hand, confers
general jurisdiction, such that while a general presence in
Delaware is necessary to assert jurisdiction, the contacts of
the nonresident (or its agent) need not relate to the instant
litigation. See Reach & Assocs., P.C. v. Dencer,
269 F.Supp.2d 497, 505 (D. Del. 2003). The court should
interpret the language of these provisions liberally, as
"conferring jurisdiction to the maximum extent of the
Due Process clause." Jeffreys v. Exten, 784
F.Supp. 146, 151 (D. Del. 1992). Further, the Delaware
long-arm statute is a "single act" statute, whereby
even one transaction engaged in by the nonresident in
Delaware establishes jurisdiction. Eudaily v.
Harmon, 420 A.2d 1175, 1180 (Del. 1980).
respect to the second step, Due Process is satisfied if the
court finds the existence of "minimum contacts"
between the nonresident defendant and the forum state,
"such that the maintenance of the suit does not offend
traditional notions of fair play and substantial
justice." International Shoe Co. v. Washington,
326 U.S. 310, 316 (1945) (internal quotation marks omitted).
makes only one objection: that the Magistrate Judge
erroneously relied upon the fiduciary shield doctrine in
recommending that Defendants' motion be granted. (See
generally D.I. 19). Incorporating by reference its
arguments from previous briefing, Plaintiff purports to
object generally to the Magistrate Judge's finding that
this Court cannot properly exercise jurisdiction pursuant to
subsections (c)(1), (c)(2), or (c)(4) of the Delaware
long-arm statute. (Id. at 3). Plaintiffs effort to
use incorporation by reference to renew other arguments is
insufficient. See Fed. R. Civ. P. 72(b)(2)
(requiring "specific written objections"). Further,
Plaintiff requests that decision on the motion be stayed
until it has the opportunity to take jurisdictional
discovery. (D.I. 19 at 3).
The Fiduciary Shield Doctrine
fiduciary shield doctrine is a judicially created doctrine
that immunizes acts performed by an individual in the
individual's capacity as a corporate employee from
serving as the foundation for the exercise of personal
jurisdiction over that individual." Res. Ventures,
Inc. v. Res. Mgmt. Int'l, Inc., 42
F.Supp.2d 423, 433-34 (D. Del. 1999) (citation omitted).
However, the doctrine is not an absolute bar to personal
jurisdiction over a corporate employee. Id. at 434.
Instead, the court should "consider all forum related
contacts of [Defendants], even those taken in their fiduciary
finding jurisdiction lacking under subsection (c)(1) of the
Delaware long-arm statute, the Magistrate Judge referred to
the fiduciary shield doctrine, explaining, "Any contacts
the individual defendants may have had with Delaware occurred
solely in connection with [Air Cleaning Equipment
("ACE")]. This situation suggests application of
the corporate shield doctrine...." (D.I. 18 at 8-9).
argues the Magistrate Judge's finding
"mis-interprets the allegations of the Amended
Complaint, and  misapplies the law as it pertains to these
defendants." (D.I. 19 at 2). According to Plaintiff, the
Magistrate Judge erroneously found that Defendants'
alleged "acts of misrepresentation and omission which
resulted in the sale of goods to Delaware were acts completed
in the regular course of employment." (Id. at
2-3). Those acts could not have been made in the regular
course of employment, Plaintiff ...