United States District Court, S.D. New York
CAPSTONE BUSINESS FUNDING, LLC Individually, and as assignee of MARCUS CONSTRUCTION, CO., Plaintiff,
DENARK CONSTRUCTION, INC., and WESTERN SURETY COMPANY, Defendants.
MEMORANDUM OPINION AND ORDER
TAYLOR SWAIN United States District Judge.
Capstone Business Funding, LLC (“Capstone”)
brought this action against Defendants Denark Construction,
Inc. (“Denark”) and Western Surety Company
(“Western Surety, ” and, with Denark,
“Defendants”) seeking to recover $248, 019.00,
plus interest, that is allegedly owed to Capstone under the
terms of two Estoppel Certificates dated October 28, 2015.
(See docket entry no. 1 (Complaint
(“Compl.”) ¶ 25.)
has moved, pursuant to Rules 12(b)(2), (4) and (5) of the
Federal Rules of Civil Procedure, to dismiss the Complaint
for lack of personal jurisdiction, for insufficient service
of process, and, alternatively, under the doctrine of
forum non conveniens. The Court has subject matter
jurisdiction of this action pursuant to 28 U.S.C. §
Court has reviewed thoroughly the submissions of both parties
in connection with Denark's motion to dismiss. For the
following reasons, Denark's motion to dismiss the
Complaint is granted.
following summary of relevant facts is drawn from the
Complaint, which is taken as true for the purposes of this
motion practice, and affidavits submitted in connection with
the instant motion.
is a Delaware corporation with its principal place of
business in New York. (Compl. ¶ 1.) Denark is a
Tennessee corporation. (Id. ¶ 2.) Marcus
Construction Company (“Marcus”), a Kentucky
limited liability company that is not a party to this action,
entered into a construction sub-contract with Denark.
(See Compl. ¶¶ 6, 13.) Marcus issued
invoices to Denark for work done pursuant to the Subcontract
in an amount of at least $278, 844.00, of which $248, 019.00
allegedly remains unpaid. (Id. ¶ 14.) Marcus
assigned these invoices to Capstone. (Id. ¶ 7.)
prepared, and mailed to Denark's offices in Tennessee,
Estoppel Certificates regarding the invoices, which Denark
modified in part and signed. (See docket entry no.
11, Declaration of Garry T. Stevens Jr. (“Stevens
Decl.”), at Ex. B (Affidavit of Frank Rothermel), at
Ex. B (“Estoppel Certificates”).) The Estoppel
Certificates state that Capstone is the assignee of payment
for Marcus, and state the amounts Denark owed Capstone,
reciting that the specified sums were then due and owing.
(Id.) Denark was instructed in correspondence
accompanying the Estoppel Certificates to send all current
and future invoice payments to Capstone's lockbox
location in Chicago, Illinois. (Id. at p. 3.)
made two modifications to the Estoppel Certificates: (1) on
one, changing the amounts due, and (2) on both, striking
provisions that jurisdiction and venue would be exclusive to
New York. (See Estoppel Certificates.) Capstone has
not contested the enforceability of these modifications.
of Denark, Marcus, and Capstone exchanged emails both before
and after the execution of the Estoppel Certificates. (Docket
entry no. 16, Affidavit of Scott A. Brody, Esq., Ex. A
(Affidavit of James Rubbinaccio), at ¶¶ 6-8.)
motion to dismiss a complaint for lack of personal
jurisdiction pursuant to Rule 12(b)(2), “[a] plaintiff
bears the burden of demonstrating personal jurisdiction over
a person or entity against whom it seeks to bring
suit.” Troma Entm't, Inc. v. Centennial
Pictures Inc., 729 F.3d 215, 217 (2d Cir. 2013)
(internal quotation marks and citation omitted). The court
must “construe the pleadings and any supporting
materials in the light most favorable to the
plaintiffs.” Licci ex rel. Licci v. Lebanese
Canadian Bank, SAL, 732 F.3d 161, 167 (2d Cir. 2013).
“Where, as here, a court relies on pleadings and
affidavits, rather than conducting a fullblown evidentiary
hearing, the plaintiff need only make a prima facie showing
that the court possesses personal jurisdiction over the
defendant.” DiStefano v. Carozzi N. Am., Inc.,
286 F.3d 81, 84 (2d Cir. 2001) (internal quotations omitted).
“resolution of a motion to dismiss for lack of personal
jurisdiction made in the Southern District of New York
requires a two-step analysis.” Bank Brussels
Lambert v. Fiddler Gonzalez & Rodriguez, 305 F.3d
120, 124 (2d Cir. 2002). “First, the court must
determine if New York law would confer upon its courts the
jurisdiction to reach the defendant, which in this case could
only be possible under the New York long-arm statute, CPLR
§ 302.” Id. “If there is a
statutory basis for jurisdiction, the court must then
determine whether New York's extension of jurisdiction in
such a case would be permissible under the Due Process Clause
of the Fourteenth Amendment.” Id. However,
“if jurisdiction is statutorily impermissible . . .
[the court] need not reach the question of its
constitutionality.” Best Van Lines, Inc. v.
Walker, 490 F.3d 239, 244 (2d Cir. 2007).
York long-arm statute provides, in relevant part, that
“a court may exercise personal jurisdiction over any
non-domiciliary . . . who in person or through an agent
transacts any business within the state or contracts anywhere
to supply goods or services in the state.” N.Y.
C.P.L.R. § 302(a)(1); Best Van Lines, Inc. v.
Walker, 490 F.3d 239, 244 (2d Cir. 2007). “CPLR
302(a) is a single act statute [and] . . . proof of one
transaction in New York is sufficient to invoke jurisdiction,
even though the defendant never enters New York, so long as
the defendant's activities here were purposeful and there
is a substantial ...