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MACHULSKY v. HALL

July 9, 2002

MARY R. MACHULSKY, PLAINTIFF, VS. DAVID HALL A/K/A SCORE 900 A/K/A ROBERT D. HALL; RICH RUSSO A/K/A DIESOON; STEVEN LEIBRANDT A/K/A BUSTERLYE; LARRY STEINBERG A/K/A JACKBLACK210; JOSEPH DENISH A/K/A AAAAABVZ; ROBERT BURTON A/K/A RB345 RICHARD BRZOZOWSKI A/K/A BUDDHAKKHAN; RICK D. JONES A/K/A RICKDJONES@AOL.COM; NORMAN KNAAK A/K/A BIDOVERU; AND JOHN AND JANE DOES, 1-100 DEFENDANTS.


The opinion of the court was delivered by: Stanley S. Brotman, United States District Judge

  OPINION ON DEFENDANTS' MOTIONS TO DISMISS

Presently before the Court, pursuant to Fed.R.Civ.P. 12, are three Motions to Dismiss filed by Defendants Steven Leibrandt a/k/a busterlye ("Leibrandt"), Norman Knaak a/k/a bidoveru, and David Hall a/k/a score 900 ("Hall") (collectively "Defendants"). Mary Machulsky, Esquire, ("Plaintiff" or "Machulsky") has filed opposition to all of the above Motions.

For the reasons stated in this Opinion, the Court grants the Motions to Dismiss filed by Defendants solely on the basis that the Court lacks personal jurisdiction over them, finding that Machulsky fails to prove that Defendants' minimum contacts with the State of New Jersey are sufficient to subject them to the jurisdiction of the Court.

I. INTRODUCTION

This litigation arises out of online commercial transactions between Mary Machulsky and Defendants Leibrandt, Knaak, and Hall, as well as other defendants not parties to these motions. Machulsky, a/k/a "samrus2," is a citizen and resident of New Jersey who operated a coin business on the internet auction Web site, eBay, located at http://www.ebay.com. (Machulsky Decl. I ¶ 3; Ex. A.) Founded in September 1995, eBay is the leading online marketplace for the sale of goods and services of individuals and businesses. See Company Overview, available at http://pages.ebay.com/community/aboutebay/overview/index.html (visited June 27, 2002). After having engaged in transactions with Machulsky, Defendants filed private and public complaints via email and eBay online feedback forums. (Knaak Aff. ¶ 14; Hall Aff. ¶ 15; Leibrandt Aff. Ex. E.) Machulsky alleges that Defendants Leibrandt, Knaak, and Hall conspired with other eBay users to defame her and cause her economic injury by ruining her eBay coin business. (Machulsky Decl. I ¶ 22; Decl. II ¶ 13.) The Court has federal question jurisdiction over this matter by virtue of Machulsky's claims under the Civil Racketeering Act ("RICO"), 18 U.S.C. § 1961 and 1962(c) & (d).

II. FACTUAL BACKGROUND

A. Defendants' EBAY Transactions with Machulsky

1. Defendant Steven Leibrandt

On June 4, 2001, Machulsky informed Leibrandt that she shipped the Type II Set. (Machulsky Decl. ¶ 14.) On June 11, 2001, Leibrandt contacted her to acknowledge receipt of her shipment, but informed her that he did not receive the item which he originally purchased, instead having a received a "Type I" set. Leibrandt stated that he would return the wrongfully shipped item and requested return information. (Id. at ¶ 15.)

On June 18, 2001, Leibrandt returned the Type I Set to Machulsky, subsequently emailing her on June 20 and 21, 2001 to inquire whether she received the returned coin set. (Leibrandt Supp. Aff. ¶ 4; Machulsky Decl. ¶¶ 16, 17.) She responded that he did not return the set originally sent to him, and stated that she would issue a refund only upon return of the correct set. (Id. at ¶ 24.) No refund was issued. (Leibrandt Supp. Aff. ¶ 5.)

On June 30, 2001, Leibrandt posted two negative comments about Machulsky's merchandise and customer service on eBay's customer "feedback" page. (Leibrandt Aff. ¶ 8; Reply Br. Ex. E.) On July 4, 2001, he emailed Machulsky to notify her that he would file a fraud complaint with eBay if she refused to refund his money (Machulsky Decl. ¶ 18),*fn2 and, he further threatened to initiate litigation and submit a complaint to the Better Business Bureau of New Jersey, (Id. Ex. J), but did not carry out these purported threats. This was the beginning of a series of exchanges between Machulsky and Leibrandt.*fn3

After reading Leibrandt's comments regarding Machulsky on eBay's feedback forum, Defendants Hall, Steinberg, and Joe Denish contacted him seeking additional information, and, he exchanged between three and four emails with each of them regarding his transaction. (Leibrandt Supp. Aff. ¶ 17.)

In response to Machulsky's claim that Leibrandt tried to cause financial injury to her online coin business, Leibrandt claims that he never targeted New Jersey residents to cause damage to Machulsky or her business, and, with the exception of his postings on the eBay "feedback" forum, he did not engage any further online discussion concerning Machulsky. (Id. ¶¶ 23, 26.)

2. Defendant Norman Knaak

Norman Knaak is a citizen and resident of the state of Alaska, and has never entered nor conducted any business in New Jersey. (Knaak Aff. ¶¶ 1-3.) Machulsky claims, however, that Knaak has "substantial business contacts and interests in New Jersey," and has "sold many thousands of dollars of goods to individuals in this State." (Machulsky Decl. I ¶ 11.) In support, she cites completed auctions and comments posted on eBay rating Knaak as a seller. (Machulsky Decl. I Ex. B.)

Knaak, employing the user name "bidoveru," made four separate eBay purchases from Machulsky totaling $330.00. (Machulsky Decl. I at 1; Knaak Aff. ¶ 5.) He avers that he was unaware of Machulsky's location when he placed his bids. (Knaak Aff. ¶ 6.) Machulsky refutes this statement, however, contending that he must have been aware because the item's location is displayed on a "listing page" which directly precedes bidding on an eBay item.*fn4 (Machulsky Decl. I ¶ 16.)

Knaak paid by PayPal and signed for the package upon delivery, but states that he never received the items that Machulsky sold to him. (Machulsky Decl. I Ex. E; Knaak Aff. ¶¶ 9, 10.) He filed an eBay fraud report, later received an empty envelope from Machulsky, and then filed a postal fraud report with the United States Postal Service. (Knaak Aff. ¶¶ 11-13.)

Thereafter, in accordance with eBay rules and regulations, he posted a negative comment concerning Machulsky's eBay seller profile. (Id. at ¶ 14.) Machulsky claims that Knaak was part of an "Enterprise" to defraud her, contends that he made false claims to PayPal, never filed a postal fraud report, and that he falsely claimed that he received an empty package.*fn5 (Machulsky Decl. I ¶¶ 21, 28-30.)

3. Defendant David Hall

Robert D. Hall is a citizen and resident of the state of Georgia and has never entered New Jersey nor maintained any business interests therein. (Machulsky Decl. II at 1; Hall Aff. ¶¶ 1-2.) On June 9, 2001, he purchased a 1911 Liberty Head Nickel from Machulsky for $31.00, attesting that he was unaware of Machulsky's location when he placed his bid. (Hall Aff. ¶¶ 5-6.)

Machulsky claims that Hall was aware of her New Jersey location both before and after the auction, citing in support: (1) the eBay "Listing Page" indicating New Jersey as the location of the item (Machulsky Decl. I Ex. A); (2) an email she sent to Hall containing her New Jersey address after the auction (Machulsky Decl. II Ex. O); (3) an envelope Hall sent to her New Jersey address (Machulsky Decl. II Ex. P); and, (4) "unsolicited grading information" of coins that Hall sent to her in New Jersey. (Machulsky Decl. II ¶ 10; Ex. Q.)

Hall maintains that all of his communications with Machulsky were via email. (Hall Aff. ¶ 8.) Because he was dissatisfied with the quality of the item which he received from Machulsky, he returned it to her on June 25, 2001. (Id. ¶ 11.) On four separate occasions following his return of the item, he requested a refund via email. (Hall Aff. Ex. B, C, D, E.) Thereafter, he posted a negative comment on an eBay forum regarding his transaction. (Id. Ex. F.)

Machulsky claims that Hall is one of the main organizers of the "Enterprise" established to disrupt her eBay business. She claims that Hall required members of the conspiracy to file fraudulent complaints with New Jersey state agencies and alleges that he directed members of the conspiracy to contact all of her past and potential eBay bidders, some of whom are New Jersey residents. (Machulsky Decl. II ΒΆ 13.) In support, she cites emails that Hall sent to a large group of individuals discussing attempts to contact ...


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