Submitted: June 11, 2019
Rule 12(b)(2) Motion to Dismiss for Lack of Personal
Motion for Return or Escrow of Funds Garnished Under the
Vacated Default Judgment - STAYED
A. Sensing, Esquire (Argued); Jesse L. Noa, Esquire; Potter
Anderson & Corroon LLP, Attorneys for Plaintiff.
Richard A. Forsten, Esquire (Argued); Elizabeth S. Fenton,
Esquire; Saul Ewing Arnstein & Lehr LLP, Attorneys for
WILLIAM C. CARPENTER, JR. JUDGE.
the Court is Fadi Sharabati's ("Defendant" or
"Mr. Sharabati") Rule 12(b)(2) Motion to Dismiss
for Lack of Personal Jurisdiction, as well as his Motion for
Return or Escrow of Funds Garnished Under the Vacated Default
Judgment. For the reasons set forth in this Opinion,
Defendant's Motion to Dismiss is GRANTED, and the
dismissal is effective forty-five days after this decision.
The Motion for Return or Escrow of Funds is STAYED.
FACTUAL & PROCEDURAL BACKGROUND
Elizabeth White ("Plaintiff or "Ms. White")
initiated this litigation to recover cryptocurrency assets
purportedly stolen from her through a fraudulent
scheme. Ms. White is a resident of New York and
"conducts business through the White Company, a Delaware
entity." Defendant Mr. Sharabati is a Palestinian
National who resides in Morocco.
December 27, 2017, Plaintiff was allegedly contacted by
Defendant and asked "to enter into a cryptocurrency
transaction, in which [she] would sell 484, 000 Ripple to
[Mr. Sharabati] in exchange for 46.5 Bitcoin using a certain
online escrow platform." Ms. White used an
"agreed-upon sequence" to transfer her Ripple, but
never received the 46.5 Bitcoin from Mr. Sharabati in
return. Plaintiff eventually traced the 484, 000
Ripple to Defendant's account on a cryptocurrency
exchange platform operated by Bittrex, a Delaware corporation
that is headquartered in Seattle, Washington.
White filed the instant lawsuit against John Doe on February
23, 2018, prior to learning the identity of the Bittrex
account holder. Plaintiff subsequently amended her Complaint
to name Mr. Sharabati as Defendant on April 3, 2018.
Approximately one month later, on May 1, 2018, the Superior
Court Prothonotary entered default judgment against Defendant
for failure to appear, plead, or otherwise
defend. After the entry of default judgment,
Plaintiff "moved to garnish certain crypto-currencies
held by Mr. Sharabati on several internet-based electronic
trading platforms, including [Bittrex] and
[Poloniex]." Bittrex subsequently turned over
approximately $455, 010.79 in cryptocurrency to Plaintiff,
while Poloniex gave her about $30, 000.
filed a Motion to Vacate the Default Judgment on November 19,
2018, and the Court granted Defendant's Motion on
December 17, 2018. Mr, Sharabati subsequently filed the
instant Motion to Dismiss for Lack of Personal Jurisdiction
and Motion for Return or Escrow of Funds Garnished Under the
Vacated Default Judgment. This is the Court's decision on
the pending Motions.
Motion to Dismiss for Lack of Personal Jurisdiction
motion to dismiss for lack of personal jurisdiction, the
plaintiff has the burden of showing a basis for the trial
court's exercise of jurisdiction over a nonresident
defendant. In Delaware, "courts will apply a
two-prong analysis to the issue of personal jurisdiction over
a nonresident." First, the court must determine whether
Delaware's long arm statute, 10 Del. C. § 3104(c),
is applicable. It then must consider whether subjecting
the nonresident to jurisdiction in Delaware violates the Due
Process Clause of the Fourteenth Amendment. The Due
Process Clause requires the defendant to have minimum
contacts with the forum state, and "it must be 'fair
and reasonable' for the court to exercise jurisdiction
over the nonresident party."
long arm statute states that "a court may exercise
personal jurisdiction over any nonresident ... who in person
or through an agent:
(1) Transacts any business or performs any character of work
or service in the State.. ."
Court to exercise jurisdiction under 10 Del. C. §
3104(c)(1), "'some act must actually ...