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Brannies v. Internet Roi, Inc.

United States District Court, S.D. Georgia, Savannah Division

December 4, 2014

MICHAEL W. BRANNIES, Plaintiff
v.
INTERNET ROI, INC., D/B/A AMERICAN OVERLOOK, Defendant

For Michael W. Brannies, Plaintiff: Dwight T. Feemster, LEAD ATTORNEY, Matthew M. Bush, Duffy & Feemster, LLC, Savannah, GA.

For Internet ROI, Inc., doing business as American Overlook, Defendant: Rachel Young Fields, Shawn A. Kachmar, LEAD ATTORNEYS, Hunter Maclean, PC, Savannah, GA.

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ORDER

G. R. Smith, UNITED STATES MAGISTRATE JUDGE.

In this defamation case plaintiff Michael W. Brannies contends that defendant Internet ROI, Inc. (ROI) published an image falsely implying that he had sexually assaulted a minor. Doc. 1-1, ¶ ¶ 5-11; doc. 7 at 1.[1] The image could be seen by Georgia residents on the internet, doc. 1-1 ¶ 8, though ROI says it was generated and internet-published in Massachusetts. Doc. 26 at 6. Having removed the matter from state court under diversity jurisdiction, doc. 1 at 2, ROI, an out-of-state resident, moves to dismiss for lack of personal jurisdiction and insufficient service. Doc. 7. That motion is before the district judge.

Before the undersigned is plaintiff's motion to compel ROI to respond to a jurisdictional discovery request. Doc. 25; see also doc. 19 (court order authorizing only " personal jurisdiction discovery" ). To establish personal jurisdiction over ROI based on its Georgia contacts, doc. 25 at 4, Brannies wants data on ROI's website pricing for third-party advertisers. Id. at 9-10; doc. 29 at 3. He says he has shown between 49,000 and 150,000 monthly ROI website visitors from Georgia. Doc. 25 at 5 n. 6. And ROI has already admitted that

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it derives its revenue from the sale of advertising on its site. Id. at 7.

ROI's website, plaintiff further maintains, " interacts with each user, collecting information regarding all of the viewers, and translating that information into income." Id. at 6. ROI's Georgia-based income, Brannies insists, is relevant to the showing he must make under the personal jurisdiction standards set forth below. He reminds that ROI deliberately sends news and information onto the internet that it knows will be viewed by Georgians, and those viewers fuel at least part of ROFs ad revenue. Id. at 7-8. Ad revenue reflects viewer visit to ROFs site. Id. at 8. So pricing is relevant to establishing contacts with Georgia. Id. ROI disagrees. Doc. 29.

I. GOVERNING STANDARDS

A. Motions To Compel

The discovery rules " require the disclosure of all relevant information so that ultimate resolution of disputed issues in any civil action may be based on a full and accurate understanding of the true facts. . . ." Gonzalez v. ETourandTravel, Inc., 2014 WL 1250034 at * 2 (M.D. Fla. Mar. 26, 2014) (quotes and cite omitted). Hence, " [t]he scope of discovery under [Fed. R. Civ. P. 26(b)(1)] is broad and includes 'discovery regarding any matter, not privileged, which is relevant to the claims or defense of any party involved in the pending action.' Hickman v. Taylor, 329 U.S. 495, 507-08, 67 S.Ct. 385, 91 L.Ed. 451 (1947)." Id. Those resisting discovery must " show specifically how the objected-to request is unreasonable or otherwise unduly burdensome." Id.

Claims and defenses determine discovery's scope. Chudasama v. Mazda Motor Corp., 123 F.3d 1353, 1368 (11th Cir. 1997). " 'Evidence is relevant if it has any tendency to make the existence of any fact or consequence more or less probable than it would be without the evidence.' United States v. Capers, 708 F.3d 1286, 1308 (11th Cir. 2013)." Gonzalez, 2014 WL 1250034 at * 2. Here, the principles by which personal jurisdiction is established inform the relevancy determination of ROI's pricing data.

B. Personal Jurisdiction

" A plaintiff seeking the exercise of personal jurisdiction over a nonresident defendant bears the initial burden of alleging in the complaint sufficient facts to make out a prima facie case of jurisdiction." United Techs. Corp. v. Mazer, 556 F.3d 1260, 1274 (11th Cir. 2009); Sterling Currency Group LLC v. Maurer, 2013 WL 4011063 at * 3 (N.D.Ga. Aug. 5, 2013). Where Georgia's long-arm statute is invoked for that purpose, the Court must first determine whether the exercise of jurisdiction under it violates the Due Process Clause. Henriquez v. El Pais Q'Hubocali.com, 500 F.App'x 824, 827-28 (11th Cir. 2012). Finally, " 'a district court may properly refuse or limit jurisdictional discovery if the plaintiff has not made a sufficient showing that there may be a basis for exercise of jurisdiction, or if the proposed discovery seems unlikely to shed light on the jurisdictional question.' Cold Smoke Capital, LLC v. Gross, No. 1:11-CV-3558-WSD, 2012 WL 3612626, at *8 (N.D.Ga. Aug. 21, 2012) (quoting Charles Alan Wright et al., 8 Federal Practice and Procedure § 2008.3 (2010))." Maurer, 2013 WL 4011063 at *9.

Brannies relies on Georgia's long-arm statute to support personal jurisdiction over ROI. He specifically invokes O.C.G.A. § 9-10-91(1) & (3). Doc. 25 at 4. In pertinent part that statute provides:

A court . . . may exercise personal jurisdiction over any nonresident . . . as to a cause of action arising from any of the

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acts . . . enumerated in this Code section, in the same manner as if he or she were a resident of this state, if in person or through an agent, he or she: (1) Transacts any business within this state; (2) Commits a tortious act or omission within this state . . .; (3) Commits a tortious injury in this state caused by an act or omission outside this state if the tort-feasor regularly does or solicits business, or engages in any other persistent course of conduct, or derives substantial revenue from goods used or consumed or services rendered in this state.

O.C.G.A. § 9-10-91.[2]

When § 9-10-91(1) is invoked, the Court must " examine all of a nonresident's tangible and intangible conduct and ask whether it can fairly be said that the nonresident has transacted any business within Georgia." Diamond Crystal Brands, Inc. v. Food Movers Intern., Inc., 593 F.3d 1249, 1264 (11th Cir. 2010). Also,

Subsection (1) applies to business transactions " conducted through ... Internet contacts." ATCO Sign & Lighting Co., LLC v. Stamm Mfg., Inc., 298 Ga.App. 528, 534, 680 S.E.2d 571 (2009); see also [ Innovative Clinical & Consulting Servs., LLC v. First Nat. Bank of Ames, 279 Ga. 672, 675, 620 S.E.2d 352 (2005)] (" [N]othing in subsection (1) requires the physical presence of the nonresident in Georgia or minimizes the import of a nonresident's intangible contacts with the State." ). The defendant must have " purposefully done some act or consummated some transaction in this state." Aero Toy Store, LLC v. Grieves, 279 Ga.App. 515, 517, 631 S.E.2d 734 (2006).

Emory Group LLC, 2014 WL 1415021 at * 2 (emphasis added). However, " it is not enough to show that the [de]fendant transacted business in Georgia. The [p]laintiff must also show that its cause of action arises out of those transactions. See ATCO Sign & Lighting Co., 298 Ga.App. at 529, 680 S.E.2d 571 ('Jurisdiction exists if . . . the cause of action arises from or is connected with the act or transaction.')." Id. at * 3.

In Emory Group LLC, where the plaintiff (" A" ) sued the defendant (" B," a non-state defendant) for selling trademark-infringing clothing, A failed to establish personal jurisdiction because, even though two customers bought B's merchandise in Georgia, A failed to show that they purchased any of the infringing garments. A thus failed on the § 9-10-91(1) (" Transacts any business within this state" ) jurisdictional peg. Nor did A satisfy § 9-10-91(2) & (3). 2014 WL 1415021 at * 3-4.

II. ANALYSIS

ROI wasn't selling anything here. It merely published news content viewable online by Georgians, and there is no allegation that its servers, much less its publication's origin, were in Georgia. In Henriquez, a Georgia resident failed to establish that his defamation action arose from or was connected with some act or transaction consummated in Georgia for purposes of § 9-10-91(1). He never showed that the defamation arose out of,

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or was connected to, any business transaction in Georgia. The defendants' only alleged Georgia contacts consisted of displaying ads for various companies on their Internet Web sites, including advertisements for a company based in Georgia. Yet, there was no showing that they secured those ads directly through Georgia companies, or through any contact with any company in Georgia. And the mere fact that a particular website displays an ad that can be viewed in Georgia, or shows a company that does business in Georgia does not, by itself, equate to contact with Georgia. Henriquez, 500 F.App'x at 829 (citing Smith v. Air Ambulance Network, 207 Ga.App. 75, 75, 427 S.E.2d 305 (1993) (the " mere placement of advertisements in Georgia" was insufficient to show that a defendant purposefully transacted business in the state, such as to establish personal jurisdiction" ).[3]

Henriquez and Barton Southern Co. effectively exemplify the " Zippo sliding

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scale" ( see supra n. 2) that the district judge likely will apply in ruling that no personal jurisdiction exists over ROI. At most plaintiff alleges (and discovery thus far has shown) a no-jurisdiction position (passive web site where information is posted and users can only view it) on the Zippo scale. That, in turn, justifies (on futility grounds) the denial of his motion to compel.

III. CONCLUSION

Accordingly, plaintiff's Motion to Compel (doc. 25) is DENIED.

SO ORDERED.


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