Motion to Dismiss For Lack of Personal Jurisdiction in Maryland

Understanding the Purpose and Significance of Personal Jurisdiction

“In deciding whether a Maryland court may exercise personal jurisdiction over an out-of-state defendant, the court must examine whether jurisdiction is established under Maryland's long-arm statute and whether the exercise of jurisdiction comports with the Due Process Clause of the Fourteenth Amendment.” (See Stisser v. SP Bancorp, Inc. (2017) 234 Md. App. 593, 615.)

“The Supreme Court has long held that the Fourteenth Amendment limits the power of state courts to exercise personal jurisdiction over out-of-state defendants.” (See id; Int'l Shoe Co. v. Washington (1945) 326 U.S. 310.)

“In the seminal case of International Shoe, the Supreme Court ruled that the Due Process Clause limits a state's exercise of personal jurisdiction over a foreign or out-of-state defendant to circumstances in which a defendant has certain minimum contacts with [the forum state] such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.” (See id.)

“Recently, in Bristol–Myers the Supreme Court emphasized that [i]n determining whether personal jurisdiction is present, a court must consider a variety of interests[,] including those of the forum state and of the plaintiff in proceeding with the cause in the plaintiff's forum of choice.” (See Stisser v. SP Bancorp, Inc. (2017) 234 Md. App. 593, 615; Bristol-Myers Squibb Co. v. Superior Court of Cal. (2017) 137 S. Ct. 1773.)

“But the ‘primary concern’ is the burden on the defendant. This burden includes not just the practical and logistical aspects of litigation but the more abstract matter of submitting to the coercive power of a state that may have little legitimate interest in the claims in question." (See id.)

“In this way, restrictions on personal jurisdiction are more than a guarantee of immunity from inconvenient or distant litigation. They are a consequence of territorial limitations on the power of the respective states.” (See Stisser v. SP Bancorp, Inc. (2017) 234 Md. App. 593, 615; Hanson v. Denckla (1958) 357 U.S. 235, 251, 78 S.Ct. 1228, 2 L.Ed.2d 1283.)

“Still, following International Shoe, the relationship among the defendant, the forum, and the litigation, rather than the mutually exclusive sovereignty of the States ... became the central concern of the inquiry into personal jurisdiction.” (See Stisser v. SP Bancorp, Inc. (2017) 234 Md. App. 593, 616; Daimler AG v. Bauman (2014) 571 U.S. 117, 126; Shaffer v. Heitner (1977) 433 U.S. 186, 204, 97 S.Ct. 2569, 53 L.Ed.2d 683.)

“Thereafter, courts applying the concept of fair play and substantial justice developed two categories of personal jurisdiction in cases involving out-of-state corporate defendants: general (or all-purpose) jurisdiction and specific (or case-linked) jurisdiction.” (See Stisser v. SP Bancorp, Inc. (2017) 234 Md. App. 593, 616.)

General versus Specific Jurisdiction

“General jurisdiction over a company exists only in instances in which the continuous corporate operations within a state [are] so substantial and of such nature as to justify suit against it on causes of action arising from dealings entirely distinct from those activities." (See Stisser v. SP Bancorp, Inc. (2017) 234 Md. App. 593, 616-17; Int'l Shoe Co. v. Washington (1945) 326 U.S. 310, 318.)

“The Supreme Court has recently explained general jurisdiction by way of analogy to an individual defendant's domicile: general jurisdiction exists when a corporation is ‘at home’ in the forum state." (See Stisser v. SP Bancorp, Inc. (2017) 234 Md. App. 593, 616-17; Goodyear Dunlop Tires Oper. v. Brown (2011) 564 U.S. 915 , 924.)

"The ‘paradigm’ forums in which a corporate defendant is ‘at home,’ ... are the corporation's place of incorporation and its principal place of business." (See BNSF Ry. Co. v. Tyrrell (2017) 137 S. Ct. 1549, 1558.)

“A court with general jurisdiction over a company may hear any claim against that company, even if all of the activity that gave rise to the claim occurred in a different state.” (See Stisser v. SP Bancorp, Inc. (2017) 234 Md. App. 593, 615; Bristol-Myers Squibb Co. v. Superior Court of Cal. (2017) 137 S. Ct. 1773.)

"Specific jurisdiction is very different. Specific jurisdiction exists only when the claim arise[s] out of or relate[s] to the defendant's contacts with the forum [.]" (See id;  Helicopteros Nacionales de Colom., S.A. v. Hall (1984) 466 U.S. 408, 414 n.8, 104 S.Ct. 1868, 80 L.Ed.2d 404.)

“A defendant corporation is subject to specific personal jurisdiction only if it can be demonstrated that:

1. the defendant has purposefully directed its activities at residents of the forum;
2. the plaintiff's claims arise out of or relate to those activities directed at the state; and
3. hether the exercise of personal jurisdiction would comport with fair play and substantial justice so as to be constitutionally reasonable."

(See Stisser v. SP Bancorp, Inc. (2017) 234 Md. App. 593, 615; Burger King Corp. v. Rudzewicz (1985) 471 U.S. 462, 472, 476, 105 S.Ct. 2174, 85 L.Ed.2d 528.)

“In determining what is reasonable under the Due Process Clause and would not offend traditional notions of fair play and substantial justice, we consider several factors.” (See Stisser v. SP Bancorp, Inc. (2017) 234 Md. App. 593, 615; Int'l Shoe Co. v. Washington (1945) 326 U.S. 310, 318.)

“Those factors are the burden on the defendant, the forum state's interest in adjudicating the dispute, the plaintiff's interest in obtaining convenient and effective relief, the interstate judicial system's interest in obtaining the most efficient resolution of controversies, and the shared interest of the several States in furthering fundamental substantive social policies.” (See id; Burger King Corp. v. Rudzewicz  (1985) 471 U.S. 462, 472, 476, 105 S.Ct. 2174, 85 L.Ed.2d 528; World–Wide Volkswagen Corp. v. Woodson (1980) 444 U.S. 286, 292, 100 S.Ct. 559, 62 L.Ed.2d 490; Asahi Metal Indus. Co., Ltd. v. Superior Ct. of Cal., Solano Cty. (1987) 480 U.S. 102, 113, 107 S.Ct. 1026, 94 L.Ed.2d 92.)

Procedural Steps Involved in Filing a Motion to Dismiss for Lack of Personal Jurisdiction

“A court may exercise personal jurisdiction as to any cause of action over a person domiciled in, served with process in, organized under the laws of, or who maintains his principal place of business in the State.” (See Md. Code, Cts. & Jud. Proc. Sub. sec. 6-102.)

“The existence of personal jurisdiction is a question of law, and the plaintiff bears the burden to establish the propriety of [the exercise of] personal jurisdiction.” (See Ghazzaoui v. Chelle, No. 0599, at *8 (Md. Ct. Spec. App. May 1, 2017).)

“Plaintiff's must establish a prima facie case for personal jurisdiction to defeat a motion to dismiss.” (See Beyond Sys., Inc. v. Realtime Gaming Holding Co. (2005) 388 Md. 1, 26, 29, 878 A.2d 567; Taylor v. CSR Ltd. (2008) 181 Md. App. 363, 373.)

“Maryland Rule 2-322(a) provides that the defense of lack of jurisdiction over the person shall be made by motion to dismiss filed before the answer.” (See Beyond Systems v. Secure Medical (2006) 168 Md. App. 186, 187.)

“Rule 2-322(a) clearly states that the defense of lack of jurisdiction over the person is waived if not made by motion to dismiss before the answer.” (See id; Chapman v. Kamara (1999) 356 Md. 426, 438, 739 A.2d 387 [Once a party files an answer without raising the defense of insufficient service of process, that defense ordinarily is waived].)

“The nature of lack of personal jurisdiction, which can be cured by waiver or consent, and the language in reported cases both suggest that, once the defense is waived, it cannot be resurrected, implying that no act by an opposing party is required in order to preserve waiver.” (See Beyond Systems v. Secure Medical (2006) 168 Md. App. 186, 189.)

"If facts are necessary in deciding the motion, the court may consider affidavits or other evidence adduced during an evidentiary hearing." (See Taylor v. CSR Ltd. (2008) 181 Md. App. 363, 373-74.)

“Without an evidentiary hearing, courts are to consider the evidence in the light most favorable to the non-moving party when ruling on a motion to dismiss for a lack of personal jurisdiction.” (See id; Zavian v. Foudy (2000) 130 Md.App. 689, 702, 747 A.2d 764.)

“[T]he burden on the plaintiff is simply to make a prima facie showing of a sufficient jurisdictional basis in order to survive the jurisdictional challenge and the court must construe all relevant pleading allegations in the light most favorable to the plaintiff, assume credibility, and draw the most favorable inferences for the existence of jurisdiction when deciding a motion to dismiss on jurisdictional grounds.” (See Taylor v. CSR Ltd. (2008) 181 Md. App. 363, 374.)

Standard of Review in Deciding a Motion to Dismiss for Lack of Personal Jurisdiction

"The defense of lack of personal jurisdiction ordinarily is collateral to the merits and raises questions of law." (See Iron Horse Farms, Inc. v. Raylyn Farms, Inc., No. 855, at *8-9 (Md. Ct. Spec. App. Apr. 10, 2017); Bond v. Messerman (2006) 391 Md. 706, 718.)

“Accordingly, [a]n appellate court reviews de novo a trial court's legal conclusion as to whether or not the trial court may exercise personal jurisdiction over a defendant." (See id; Dynacorp Ltd. v. Aramtel Ltd. (2012) 208 Md. App. 403, 477; Himes Assocs., Ltd. v. Anderson (2008) 178 Md. App. 504, 526.)

Legal Precedents and Case Law on a Motion to Dismiss for Lack of Personal Jurisdiction

It is well settled that “it is the defendant who must raise questions of personal jurisdiction at the pleading stage; under Maryland Rule 2-322(a) any defense to personal jurisdiction is waived if not raised before filing an answer to the complaint.” (See Hansfordv. District of Columbia (1993) 329 Md. 112, 120, 617 A.2d 1057, 1060; Beyond v. Realtime (2005) 388 Md. 1, 31-32.)

As such, it is also well settled that “a plaintiff bears no affirmative duty to plead personal jurisdiction in a complaint, and it is inappropriate ordinarily to grant a motion to dismiss based solely on the pleadings and to deny discovery on the issue of amenability to suit.” (See id; Edmond v. United States Postal Serv. Gen. Counsel (1992) 953 F.2d 1398, 1401.)