PlayUp, Inc. v. Mintas

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PLAYUP, INC., Plaintiff, v. LAILA MINTAS, Defendant.

LAILA MINTAS, Counter-Claimant, v. PLAYUP INC., et al., Counter-Defendants.

No. 2:21-cv-02129-GMN-NJK

United States District Court, D. Nevada

February 13, 2023

ORDER

Gloria M. Navarro, District Judge.

Pending before the Court is Counter-Defendant PlayUp Ltd.'s (“PlayUp AUS's”) Motion to Dismiss, (ECF No 143). Defendant and Counter-Claimant Laila Mintas (“Mintas”) filed a Response, (ECF No. 168), to which PlayUp AUS filed a Reply, (ECF No. 174).

Further pending before the Court is Counter-Defendant Daniel Simic's (“Simic's”) Motion to Dismiss (ECF No. 144). Mintas filed a Response, (ECF No. 166), to which Simic filed a Reply, (ECF No. 172).

Further pending before the Court is Mintas's Motion to Supplement, (ECF No. 196), which seeks to supplement her Response to Simic's Motion to Dismiss. Simic filed a Response, (ECF No. 204), to which Mintas filed a Reply, (ECF No. 206).

For the reasons discussed below, the Court GRANTS PlayUp US's Motion to Dismiss, DENIES Simic's Motion to Dismiss, and GRANTS Mintas's Motion to Supplement.

I. BACKGROUND

This action arises from a dispute between a company and its former CEO. (See generally First Am. Compl. (“FAC”), ECF No. 134). Defendant and Counter-Claimant Laila Mintas (“Mintas”) was the CEO for PlayUp Inc. (“PlayUp US”), a Delaware corporation, from 2019 to 2021. (Second Am. Counterclaim (“SAC”) ¶¶ 7, 29, 86, ECF No. 133). Near the end of her two-year employment contract, Mintas started negotiating for a new employment contact.^[1](SAC ¶¶ 40, 52-61).

Around the same time, PlayUp US's Australian parent company, PlayUp Ltd. (“PlayUp AUS”), was discussing possible business deals with another company, FTX, including FTX's possible acquisition of PlayUp AUS (the “FTX deal”). (FAC ¶ 31). For reasons bitterly disputed amongst the parties, the FTX deal fell through. (See FAC ¶ 75); (SAC ¶ 99).

On November 30, 2021, PlayUp U.S. filed this suit against Mintas, alleging tort and contract claims relating to her employment with PlayUp US. (See Compl., ECF No. 1).^[2] On December 1, 2021, PlayUp AUS filed a related claim in the Federal Court of Australia against Mintas alleging that she disparaged PlayUp AUS, resulting in FTX's withdrawal of its acquisition offer. (Australia Court Compl., Ex. A to PlayUp AUS's MTD, ECF No. 143-3). In response to the instant lawsuit, Mintas filed counterclaims against PlayUp US, as well as PlayUp AUS and its CEO Daniel Simic, who were not initially parties to this case. (See generally SAC). PlayUp AUS and Simic (collectively, the “Australian Counter-Defendants”) now move to dismiss the counterclaims against them for lack of personal jurisdiction.^[3] (PlayUp AUS's MTD, ECF No. 143); (Simic's MTD, ECF No. 144). PlayUp AUS additionally argues that the claims against it should be dismissed under principles of forum non conveniens and international comity. (PlayUp AUS's MTD 15:27-28).

II. LEGAL STANDARD

Federal Rule of Civil Procedure 12(b)(2) permits a defendant, by way of motion, to assert the defense that a court lacks personal jurisdiction over a defendant. Fed.R.Civ.P. 12(b)(2). When a 12(b)(2) motion is based on written materials, rather than an evidentiary hearing, a plaintiff need only establish a prima facie showing of jurisdictional facts to withstand a motion to dismiss. Ballard v. Savage, 65 F.3d 1495, 1498 (9th Cir. 1995). District courts take the uncontroverted allegations in a complaint as true. Dole Food Co. v. Watts, 303 F.3d 1104, 1108 (9th Cir. 2002).

When no federal statute applies to the determination of personal jurisdiction, the law of the state in which the district court sits applies. Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 800 (9th Cir. 2004). Because Nevada's long-arm statute reaches the outer limits of federal constitutional due process, courts in Nevada need only assess constitutional principles of due process when determining personal jurisdiction. See NRS § 14.065; Galatz v. Eighth Judicial Dist. Court, 683 P.2d 26, 28 (Nev. 1984).

Due process requires that a non-resident defendant have minimum contacts with the forum state such that the “maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice.'” Int'l Shoe Co. v. Washington, 326 U.S. 310, 316 (1945) (quoting Milliken v. Meyer, 311 U.S. 457, 463 (1940)). Minimum contacts may give rise to either general jurisdiction or specific jurisdiction. LSI Indus., Inc. v. Hubbell Lighting, Inc., 232 F.3d 1369, 1375 (Fed. Cir. 2000).

General jurisdiction exists where a defendant maintains “continuous and systematic” ties with the forum state, even if those ties are unrelated to the cause of action. Id. (citing Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 414-16 (1984)). Specific jurisdiction exists where claims “arise[] out of” or “relate[] to” the contacts with the forum, even if those contacts are “isolated and sporadic.” Id.

III. DISCUSSION

PlayUp AUS and Simic both assert that the Court does not have personal jurisdiction over them. (PlayUp AUS's MTD 3:15); (Simic's MTD 8:18). Mintas responds that the Court has specific jurisdiction over both Australian Counter-Defendants.^[4] (Resp. PlayUp AUS's MTD 8:7, ECF No. 166); (Resp. Simic's MTD 12:14, ECF No. 168). Additionally, Mintas argues that PlayUp AUS waived any objections to the exercise of personal jurisdiction by a court in Nevada by virtue of the forum selection clauses in Mintas's employment agreements with PlayUp US. (Resp. PlayUp AUS's MTD 8:17-18). The Court begins by addressing whether PlayUp AUS waived any objections to the exercise of personal jurisdiction in this state before determining whether the Court has specific personal jurisdiction over the Australian Counter-Defendants.

A. PlayUp AUS Did Not Waive Objections to Personal Jurisdiction

Mintas argues that the Court may exercise specific jurisdiction over PlayUp AUS because PlayUp AUS has already consented to personal jurisdiction, and waived any objections to such personal jurisdiction that might otherwise exist, by virtue of the forum selection clauses in Mintas's employment agreements. (Id. 8:15-24). Mintas maintains this argument even though PlayUp AUS was not a signatory to the agreements. (Id.).

“A defendant may consent to personal jurisdiction through a forum-selection clause.” Andrade v. Dillman, Case No.: 2:20-cv-01021-JAD-NJK, 2021 WL 1033209 at *2 (D. Nev. Mar. 17, 2021) (citing Burger King Corp. v. Rudzewicz, 471 U.S. 462, 472 n.14 (1985)). This rule extends from the general notion that personal jurisdiction is a waivable right. Prod. & Ventures Int'l v. Axus Stationary (Shanghai) Ltd., No. 16-cv-00669-YGR, 2017 WL 201703, at *4 (N.D. Cal. Jan. 18, 2017).

Thus, “[a] defendant may waive objections to personal jurisdiction through a forum selection clause ‘provided that the defendant agrees to be so bound.'” My Daily Choice, Inc. v. Hunter, No. 2:20-cv-00809-APG-DJA, 2020 WL 4370548, at *2 (D. Nev. July 30, 2020) (quoting Holland Am. Line Inc. v. Wartsila N. Am., Inc., 485 F.3d 450, 458 (9th Cir. 2007)). But a non-signatory may also be bound by a forum selection clause, thereby waiving objections to personal jurisdiction in the forum. See, e.g., Prod. & Ventures Int'l, 2017 WL 201703, at *7-8. “In determining whether a non-signatory can enforce or be subject to a forum selection clause, the court looks to general contract and agency principles.” Nav N Go Kft. v. Mio Tech. USA, Ltd., No. 2:08-cv-01384-LRH-LRL, 2009 WL 10693414, at *7-8 (D. Nev. June 11, 2009).

A non-signatory may be bound by a forum-selection clause when the non-signatory knowingly exploits and directly benefits from the agreement or when the non-signatory is closely related to the contractual relationship. White Knight Yacht LLC v. Certain Lloyds at Lloyd's London, 407 F.Supp.3d 931, 947 (S.D. Cal. 2019); see also Prod. & Ventures Int'l, 2017 WL 201703, at *7 (finding non-signatories bound by forum-selection clause when one non-signatory personally negotiated agreement, signed on behalf of signatory, and owned significant interests in signatory and other non-signatory had active role in managing signatory). A non-signatory's position as an affiliate of a signatory is not sufficient to enforce forum-selection clause against the non-signatory. Nav N Go Kft., 2009 WL 10693414, at *7-8.

Mintas argues that PlayUp AUS consented to personal jurisdiction in Nevada because it is bound by the forum-selection clause in the employment agreements between PlayUp U.S. and Mintas. Specifically, Mintas asserts that PlayUp AUS “has clearly received and exploited the benefits of Mintas' work under her employment agreements” because her employment with PlayUp U.S. included her role as a member of the board of PlayUp AUS. (Resp. PlayUp AUS's MTD 13:11-14). PlayUp AUS replies that it has not received and exploited the benefits of Mintas's employment because Mintas worked for PlayUp US, not PlayUp AUS. (Reply PlayUp AUS's MTD 2:19-24, ECF No. 174). If any benefit to PlayUp AUS existed, PlayUp AUS contends, it flowed only indirectly from Mintas's employment agreements. (Id. 2:21-28).

The Court is not persuaded that PlayUp AUS consented to personal jurisdiction in Nevada by virtue of the forum selection clause in Mintas's employment agreements with PlayUp US. Mintas offers conclusory statements devoid of any citations to the record to explain why PlayUp AUS should be bound by agreements it did not sign. (See Resp. PlayUp AUS's MTD 3:11-16). Without any specific evidence demonstrating that PlayUp AUS agreed to be bound by the forum selection clause, the Court cannot find that PlayUp AUS waived its objection to personal jurisdiction. Thus, the Court must...