Sherman v. Biglari

Charna Sherman, Plaintiff, v. Sardar Biglari, et al., Defendants.

Case No. 1:18cv2887

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF OHIO WESTERN DIVISION

June 4, 2020

JUDGE PAMELA A. BARKER

MEMORANDUM OPINION AND ORDER

Currently pending is the Motion of Defendants Sardar Biglari, Maxim, Inc., Christopher Clark, and Sandeep Savla to Dismiss pursuant to Federal Rules of Civil Procedure 12(b)(1), (b)(2), (b)(3), and (b)(6). (Doc. No. 8.) Plaintiff Charna Sherman filed a Brief in Opposition, to which Defendants replied. (Doc. Nos. 24, 33.) Supplemental Briefing was filed in October and November 2019. (Doc. Nos. 65, 68, 69.)

The Court has reviewed the parties' extensive briefing and determined that an evidentiary hearing is not necessary. For the following reasons, Defendants' Motion to Dismiss (Doc. No. 8) is GRANTED to the extent it seeks dismissal on the basis of lack of personal jurisdiction. Defendants' Motion is DENIED AS MOOT to the extent it seeks dismissal for improper venue and failure to state a claim.

I. Procedural History

On December 17, 2018, Plaintiff Charna Sherman ("Plaintiff" or "Sherman") filed a Complaint against Sardar Biglari; Maxim, Inc.; Latham & Watkins, LLP; Christopher Clark; and Sandeep Savla, asserting state law claims for malicious prosecution, abuse of process, and violations of New York Judiciary Law § 487. (Doc. No. 1.)

On February 15, 2019, the above Defendants moved for dismissal of Plaintiff's Complaint in its entirety, asserting various grounds including lack of both subject matter and personal jurisdiction.¹ (Doc. Nos. 8, 9.) Plaintiff opposed the motion. (Doc. No. 24.) On February 28, 2019, upon motion of the Defendants, then-assigned District Judge Christopher Boyko stayed discovery in this matter except for "discovery necessary to address the dispute over diversity jurisdiction." (Doc. No. 18.)

Plaintiff subsequently filed an Unopposed Motion to drop Latham & Watkins LLP as a Defendant in order to retain diversity jurisdiction, which was granted. (Doc. No. 23.) See Non-Document Order dated April 30, 2019. Thereafter, the parties filed a joint motion, in which they "agree[d] that instead of requiring Plaintiff to file an amended complaint, it is proper to simply drop Latham as a defendant and proceed with the current complaint." (Doc. No. 26.) On May 3, 2019, the Court granted the motion in part, stating that: "On or before May 10, 2019, Plaintiff shall file an Amended Complaint removing Latham & Watkins, LLP as a Defendant and removing any of the substantive claims asserted against Defendant Latham. Since there will be no new claims or allegations asserted, and in view of the parties' joint agreement, the pending Motion to Dismiss (ECF DKT #8) will be deemed filed as against the Amended Complaint and will not be mooted." (Doc. No. 27.)

On May 7, 2019, Plaintiff filed her First Amended Complaint. (Doc. No. 29.) Defendants then filed a Motion to Strike Substantive Changes, in which they argued that Plaintiff had improperly"added new and irrelevant substantive allegations to what was already a 143-page slog of insults, profanity, unattributed quotations, and gratuitous references to current events." (Doc. No. 32.) Plaintiff opposed the motion. (Doc. No. 36.)

The Court² referred the Motion to Magistrate Judge Baughman. (Doc. No. 46.) On September 23, 2019, Judge Baughman issued an Order granting the motion and striking Plaintiff's First Amended Complaint. (Doc. No. 57.) Rather than requiring Plaintiff to refile a proper First Amended Complaint, Judge Baughman attached a redlined version of the Complaint to his Order that removed language in accordance with Judge Boyko's Order. (Id.) Judge Baughman then "incorporate[d] by reference Attachment 1 to this order, which shall be deemed the First Amended Complaint in this case." (Id.) Thus, Attachment 1 to Judge Baughman's September 23, 2019 Order (Doc. No. 57-1) constitutes the operative Complaint in this matter.

Meanwhile, on May 22, 2019, Defendants filed a "Motion to Continue Stay of Discovery Until Personal Jurisdiction Issue is Decided." (Doc. No. 31.) In response, Plaintiff asked the Court to permit her to proceed with jurisdictional discovery, citing a number of alleged factual disputes relevant to the issue of Defendants' alleged contacts with the State of Ohio. (Doc. No. 34.) She further asked the Court to conduct an evidentiary hearing on the issue, once jurisdictional discovery has been completed. (Id.)

On August 5, 2019, the Court issued an Order finding that limited jurisdictional discovery was warranted. (Doc. No. 45.) The Court allowed the parties sixty (60) days from the date of theOrder (i.e., until October 4, 2019) to engage in limited discovery relating to the issue of personal jurisdiction. (Id.) All other discovery remained stayed.³ (Id.)

On September 27, 2019, the parties filed a Joint Motion for a Supplemental Briefing schedule, which the Court granted. (Doc. No. 61.) Supplemental Briefing regarding the issue of personal jurisdiction was thereafter filed in October and November 2019. (Doc. Nos. 65, 67, 68, 69.) Plaintiff also filed Supplemental Authority in January 2020, to which Defendants responded. (Doc. Nos. 70, 71.)

II. Factual Allegations⁴

A. The First New York Action

On December 10, 2015, Maxim, Inc. ("Maxim") and Sardar Biglari⁵ filed a Complaint in the Supreme Court of New York, County of New York against former Maxim employee Wayne Gross.(Doc. No. 9-2.) See Maxim, Inc. v. Gross, Index No. 654137/2015 (Sup. Ct. N.Y., Cty of N.Y.) (hereinafter referred to as the "First New York Action.") In this Complaint, Maxim and Biglari alleged that Gross made numerous false statements to the New York Post about a photo shoot of model Alessandra Ambrosio for Maxim Magazine that took place in Monaco on July 26, 2015. (Id. at ¶ 1.) Specifically, Maxim and Biglari alleged (among other things) that Gross falsely stated to the New York Post that Ms. Ambrosio (1) was "creeped out by Biglari, who hung around on the set;" (2) "reluctantly" agreed to pose for a photo with Biglari during the photo shoot; and (3) expressly sought assurance that that photo would not be published. (Id. at ¶ 2.)

Maxim and Biglari asserted that, on December 2, 2015, the Post printed these (and other) allegedly false statements in an article entitled "Maxim owner was really creepy toward Alessandra Ambrosio during shoot." (Id. at ¶ 12.) In this article, the Post attributed the allegedly false statements to an "insider." (Id. at ¶ 14.) Maxim and Biglari claimed that, since Gross was the only Maxim employee present at the shoot, he was necessarily the "insider" that had made the false statements. (Id. at ¶¶ 15, 16.) They asserted that the Post subsequently published a revised article on December 8, 2015 (entitled "Maxim publishes photo of owner with Alessandra Ambrosio despite objection") that made minor revisions but was still false. (Id. at ¶ 33.)

Maxim and Biglari alleged that Gross' alleged statements to the Post were untruthful and, further, that his conduct violated a non-disclosure agreement that Gross executed in November 2014, as well as a release that he had entered into when his employment with Maxim was terminated in September 2015. (Id. at ¶¶ 3, 40-41, 48-54.) Maxim and Biglari asserted state law claims for breachof contract and defamation, and sought compensatory and punitive damages. (Id. at ¶¶ 56-78.) At the time of the filing of the Complaint, Maxim and Biglari were represented by Christopher Clark and Sandeep Savla of Latham & Watkins' New York office. (Id. at p. 14.)

B. Plaintiff's Communications with Defendant Savla and other attorneys at Latham & Watkins

At some point in time (it is not clear from the record before this Court exactly when), Jason Feifer retained Plaintiff herein, Charna Sherman, to represent him. (Doc. No. 57-1 at ¶¶ 8,101.) Jason Feifer was hired by Maxim in early 2015 and signed a Non-Disclosure Agreement on March 21, 2015 that contained confidentiality and nondisclosure provisions. (Doc. No. 9-1 at ¶¶ 14-20.) Mr. Feifer's employment with Maxim was subsequently terminated, at which time he signed a Release Agreement that contained various terms, including a severance payment and confidentiality and nondisclosure provisions. (Doc. No. 57-1 at ¶ 98; Doc. No. 9-1 at ¶¶ 14, 21-29.)

In the First Amended Complaint, Sherman alleges that it was, in fact, Feifer that reached out to the New York Post in November 2015 regarding the photo shoot with Alessandro Ambrosio. (Doc. No. 57-1 at ¶ 100.) Sherman alleges that "[w]hen Feifer learned weeks later that Biglari and Maxim had sued the wrong insider - Gross—over the new information in the December Post Article he had provided to the reporter, he contacted Sherman." (Id. at ¶ 101) (emphasis in original).

Plaintiff Sherman is an attorney admitted to and practicing in the State of Ohio. (Doc. No. 57-1 at ¶ 27.) On December 13, 2015, Sherman contacted Defendant Clark by email on behalf of Mr. Feifer "to try to negotiate a private out-of-court settlement."⁶ (Id. at ¶ 102.) In that email, Sherman"communicated Feifer's revocation of his execution of Maxim's severance offer and requested that 'efforts' be 'undertake[n]. . . forthwith to cancel any . . . . arrangements' underway for payment by Maxim of the consideration of additional compensation." (Id.) Sherman further requested to speak with Clark as soon as possible to discuss a suitable termination agreement, "which she specified 'would have bearing' on the First [New York] Action." (Id.)

On December 14, 2015, Defendant Savla left a voicemail for Sherman. (Id. at ¶ 104.) In response, Sherman emailed Savla that she would try to reach him that afternoon. (Id.) Later that day, Savla and Sherman had an "initial telephone conference" as a follow-up to Sherman's email.⁷ (Id. at ¶ 105.) In New York state court filings, Defendant Savla filed an Affidavit under oath, in which he described this initial conversation as...